/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140425.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, April 25, 2014, Vol. 18, No. 113 Headlines 4LICENSING CORP: Cash Woes Due to Bankruptcy Costs ACCESS PHARMACEUTICALS: Swings to $1.5-Mil. Net Income in 2013 ADVANCED MICRO DEVICES: Incurs $20 Million Loss in First Quarter AFFIRMATIVE INSURANCE: Eric Rahe Elected to Board of Directors ALION SCIENCE: Amends Form S-1 Prospectus ALLIED INDUSTRIES: Wants Cash Collateral Use Extended to July 31 AMERICAN APPAREL: Regains Compliance with NYSE Listing Rule AMERICAN BIO MEDICA: Liggett Vogt Again Raises Going Concern Doubt AMERICAN ROCK: S&P Affirms 'B-' CCR & Rates $350MM Loan 'B' ANDALAY SOLAR: Board Appoints Steven Chan as CEO ANTERO RESOURCES: Moody's Rates New $500MM Unsecured Notes 'B1' ANTERO RESOURCES: S&P Rates $500M Sr. Unsecured Notes 'BB-' API TECHNOLOGIES: Redeems All Series A Stock for $27.6 Million API TECHNOLOGIES: Douglas Topkis Ceased to Own 5% Equity Stake ASHLEY STEWART: Court Approves Sale of Assets to Clearlake Unit BANK OF THE CAROLINAS: Incurs $1.4 Million Net Loss in 2013 BAY AREA FINC'L: Objects to Lombardo & Safford as Special Counsel BAY CLUB: Gets Final OK to Access CDO's Cash Collateral BIOFUEL ENERGY: Incurs $45.6 Million Net Loss in 2013 BIOLIFE SOLUTIONS: Walter Villger Stake at 36.9% as of March 25 BOREAL WATER: To File 2013 Form 10-K in May BROWN MEDICAL: Carr Riggs Okayed as Ch. 11 Trustee's Accountants BROWN MEDICAL: Ch.11 Trustee Has Stipulation Over Byman CRO BROWN MEDICAL: Ch.11 Trustee to Hire More Porter Hedges Staff BUDD COMPANY: Epiq Approved as Noticing and Claims Agent BUDD COMPANY: Files Schedules of Assets and Liabilities BUDD COMPANY: May Pay Expenses of UAW's Advisors BUDD COMPANY: U.S. Trustee to Appoint Retirees' Committee BUILDING #19: May Amend Schedules and Statements BUILDING #19: Seeks to Auction Off Remaining Inventory C&K Market: Hires Cushman & Wakefield as Appraiser CAESARS ENTERTAINMENT: Closes Offering of $675MM Senior Notes CD STORES: Carol's Daughter Files for Chapter 11, to Close Stores CD STORES: Voluntary Chapter 11 Case Summary CLEAN DIESEL: BDO USA Raises Going Concern Doubt COATES INTERNATIONAL: Narrows Net Loss to $2.75-Mil. in 2013 COMMUNICATION INTELLIGENCE: Had $8.1-Mil. Net Loss in 2013 COMPETITIVE TECHNOLOGIES: Reports $2.67 Million 2013 Net Loss COPYTELE INC: Amends 2013 Form 10-K to Add Disclosure ELWOOD ENERGY: S&P Affirms 'BB-' Rating on $402MM Secured Bonds EMISPHERE TECHNOLOGIES: McGladrey Raises Going Concern Doubt ERA GROUP: S&P Lowers Unsecured Debt Rating to 'B-' FIRST SECURITY: To Issue 6.2 Million Common Shares Under Plan FOUR OAKS: Inks Securities Purchase Agreement with Kenneth Lehman FREDERICK'S OF HOLLYWOOD: Merger Closing Date Extended to June 15 FREDERICK'S OF HOLLYWOOD: FOHG Stake at 86.1% as of mid-April FRESH & EASY: Files Ch. 11 Liquidating Plan FRIENDSHIP DAIRIES: Opposes Agstar's Move to Reconsider Stay Order FRIENDSHIP DAIRIES: Committee Opposes Staying the Confirmation Hrg GENCO SHIPPING: Proposes June Confirmation of Prepack Plan GENCO SHIPPING: Deal With Lenders Has $26.5-Mil. Termination Fee GENERAL MOTORS: Confirms Investigations Under Way GENERAL MOTORS: Profit Falls 82% Amid Recalls GRAFTECH INTERNATIONAL: S&P Revises Outlook & Affirms 'BB+' CCR GREAT PLAINS: US Trustee Objects to RBS Settlement Agreement GREAT PLAINS: Reaches Stipulation With Wells Fargo GREAT PLAINS: Fights 1st Source's Motion for Relief From Stay GREAT PLAINS: US Trustee Blocks Cash Collateral Order Amendment HEARTHSIDE GROUP: Moody's Keeps CFR Over Revised Capital Structure HEMISPHERE MEDIA: S&P Affirms 'B' CCR; Outlook Stable HORIZON LINES: New Subsidiaries Guarantee Outstanding Debt HUCKABEE RENTALS: Case Summary & 8 Largest Unsecured Creditors INDIGO-ENERGY INC: Incurs $1.6 Million Net Loss in 2012 INERGETICS INC: Had $4.19-Million Net Loss in 2013 INSITE VISION: Burr Pilger Mayer Has Going Concern Doubt INSTITUTO MEDICO: Taps Monge Robertin as Restructuring Advisors INSTITUTO MEDICO: UST Bid to Dismiss Case Deemed as Moot INTERFACE SECURITY: Moody's Affirms B3 Corporate Family Rating INVESTMENTS GP: Case Summary & 3 Largest Unsecured Creditors INT'L ENVIRONMENTAL: 2nd Stipulation With EH National Bank OK'd INTERNATIONAL TEXTILE: Incurs $10.9 Million Net Loss in 2013 ISC8 INC: Hires Griffin Partners as Restructuring Consultant JAMES RIVER: BNP Paribas Stake at 5.8% as of Dec. 31 LARSEN ROAD: Seeks to Employ Leverson & Metz as Attorneys LATTICE INC: Rosenberg Raises Going Concern Doubt LDK SOLAR: Seeks Review of NYSE's Trading Suspension Decision LEARNING CARE: S&P Affirms 'B' CCR & Rates $370MM Facility 'B' LUZ ACADEMY TUCSON: Case Summary & 20 Top Unsecured Creditors MASON COPPELL: Hires Munsch Hardt as Attorneys MASON COPPELL: Affiliate Taps Wick Phillips as Counsel MERRIMAN HOLDINGS: Marcum LLP Raises Going Concern Doubt MOBILE MINI: Moody's Affirms B1 CFR & B2 Senior Unsecured Rating MOMENTIVE PERFORMANCE: Final DIP Hearing on May 15 MOMENTIVE PERFORMANCE: 7-Member Panel Named, Hires Klee Tuchin MOMENTIVE PERFORMANCE: Files First Amendment to Plan Support Deal MOMENTIVE PERFORMANCE: Has Interim OK to Pay Trade Creditors MT. GOX: Tokyo Court Orders Commencement of Liquidation NETWORK CN: Widens Loss to $3.89-Mil. in 2013 NEWLEAD HOLDINGS: MGP Asks 5.8 Million Add'l Settlement Shares NEW FARMERS BUILDING: Voluntary Chapter 11 Case Summary ON ASSIGNMENT: S&P Raises CCR to 'BB' on Reduced Debt Leverage OVERSEAS SHIPHOLDING: Recanati et al. Disclose Equity Stake PEM THISTLE: Court Dismisses Case, Debtor Seeks Reconsideration PETRON ENERGY: Amends 300 Million Shares Prospectus PILOT TRAVEL: S&P Revises Outlook to Stable & Affirms 'BB' CCR POCMONT PROPERTIES: Files Ch.11, In Talks to Sell Bushkill Inn POLEY PAVING: Case Summary & 20 Largest Unsecured Creditors POLY PLANT PROJECT: Employs Donahoe & Young as Attorneys POSITRON CORP: Sassetti LLC Again Raises Going Concern Doubt PRESSURE BIOSCIENCES: Marcum Again Raises Going Concern Doubt PRIME TIME INT'L: Taps Schian Walker as Conflicts Counsel QUANTASON LLC: 3-D Ultrasound Developer Files for Quick Sale QUANTASON LLC: Case Summary & 6 Unsecured Creditors QUANTUM CORP: Director Michael Brown Won't Seek for Re-Election RIVIERA HOLDINGS: Incurs $26.7-Mil. Net Loss in 2013 ROCKET SOFTWARE: Moody's Affirms B2 CFR & Changes Outlook to Neg. SABRE HOLDINGS: S&P Raises Corp. Credit Rating to 'B+' SAGITTARIUS RESTAURANTS: S&P Retains 'B' CCR Over Upsized Loan SEGA BIOFUELS: Deere Wants Court to Rescind Stay Relief Order SEVEN SISTERS: Voluntary Chapter 11 Case Summary SHA-WASHINGTON: Involuntary Chapter 11 Case Summary SIFCO S.A.: Brazilian Auto-Parts Maker Files Ch. 15 in New York SIFCO S.A.: Chapter 15 Case Summary SIGMA LABS: Pritchett Siler Raises Going Concern Doubt SOCKET MOBILE: Had $620K Net Loss in 2013 SPECIALTY HOSPITAL: Hit with Involuntary Ch. 11 SPIRE CORP: McGladrey LLP Again Raises Going Concern Doubt STATER BROS: Moody's Affirms 'B2' Corporate Family Rating STATER BROS: S&P Affirms 'B+' CCR & Revises Outlook to Stable TCH-2 HOLDINGS: S&P Assigns 'B-' CCR on Private Equity Acquisition TNI BIOTECH: Turner Stone Expresses Going Concern Doubt TRISTAR WELLNESS: Incurs $12.6 Million Net Loss in 2013 UNITED AMERICAN: Files Form 10-KT, Reports $537K Income in 2013 USG CORP: Further Amends 2010 Credit Agreement with JPMorgan USMART MOBILE: Incurs $13.8 Million Net Loss in 2013 VALHALLA PROPERTY: Voluntary Chapter 11 Case Summary VERTELLUS SPECIALTIES: Moody's Changes Caa1 Outlook to Positive VIGGLE INC: Amends 2.1 Million Shares Prospectus VUZIX CORP: Delays 2013 Annual Report with SEC WATERFORD GAMING: S&P Lowers ICR to 'CC' on Potential Default WESTMORELAND COAL: Jeffrey Gendell Stake at 10.4% as of March 18 WPCS INTERNATIONAL: Chief Financial Officer J. Heater to Quit WPCS INTERNATIONAL: Script of Earnings Call Available YOU ON DEMAND: UHY LLP Expresses Going Concern Doubt ZALE CORP: Meeting to Consider Proposed Acquisition Set on May 29 ZOGENIX INC: James Breitmeyer Appointed as Director * Bankruptcy Filings Down 11% for March 2014 * BOOK REVIEW: A Legal History of Money in the United States, 1774-1970 ********* 4LICENSING CORP: Cash Woes Due to Bankruptcy Costs -------------------------------------------------- 4Licensing Corporation had a net loss of $3.16 million on $1.21 million of revenues in 2013, according to the Company's Form 10-K filing with the U.S. Securities and Exchange Commission. 4Licensing had net income of $9.54 million on $3.32 million of total net revenues for the year ended Dec. 31, 2012, following a net loss of $17.08 million on $8.07 million of total net revenues in 2011. EisnerAmper LLP expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has suffered recurring losses from operations, does not generate significant revenues and at Dec. 31, 2013, had a negative working capital. The Company emerged from Chapter 11 bankruptcy proceedings on Dec. 21, 2012, and the costs of the bankruptcy proceedings and settlements of the bankruptcy claims have left the Company with only limited liquidity to funds its day-to-day operations. The Company's balance sheet at Dec. 31, 2013, showed $3.57 million in total assets, $2.76 million in total liabilities, and stockholders' equity of $0.8 million. A copy of the Form 10-K is available at: http://is.gd/mPFeWH About 4Licensing Corporation 4Licensing Corporation, formerly 4Kids Entertainment, Inc., is a licensing company specializing in the youth oriented market. Through its subsidiaries, 4LC licenses merchandising rights to popular children's television series, properties and product concepts, builds up brands through licensing, develops ideas and concepts for licensing and plans to forge new license relationships in the sports licensing industry and develop private label goods that will be sold to retail or directly to consumers. 4Kids filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code to protect its most valuable asset -- its rights under an exclusive license relating to the popular Yu-Gi-Oh! series of animated television programs -- from efforts by the licensor, a consortium of Japanese companies, to terminate the license and force 4Kids out of business. 4Kids and affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 11-11607) on April 6, 2011. 4Kids Entertainment disclosed $78,397,971 in assets and $86,515,395 in liabilities as of the Chapter 11 filing. Kaye Scholer LLP served as the Debtors' restructuring counsel. Hahn & Hessen LLP served as counsel to the Official Committee of Unsecured Creditors. The Japanese consortium, which included TV Tokyo Corporation, were represented by Olshan Grundman Frome Rosenzweig & Wolosky LLP,in New York. In January 2012, the bankruptcy judge ruled in favor of 4Kids, deciding that the Yu-Gi-Oh! property license agreement was not effectively terminated prior to the bankruptcy filing. Following the ruling, 4Kids entered into a settlement where it would receive $8 million to end the dispute over the Yu-Gi-Oh! property. In December 2012, U.S. Bankruptcy Judge Shelley C. Chapman confirmed the Debtor's Chapter 11 plan. ACCESS PHARMACEUTICALS: Swings to $1.5-Mil. Net Income in 2013 -------------------------------------------------------------- Access Pharmaceuticals, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing net income allocable to common stockholders of $1.55 million on $2.04 million of total revenues for the year ended Dec. 31, 2013, as compared with a net loss allocable to common stockholders of $12.53 million on $4.40 million of total revenues during the prior year. As of Dec. 31, 2013, the Company had $613,000 in total assets, $15.39 million in total liabilities and a $14.77 million total stockholders' deficit. Whitley Penn LLP, in Dallas, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has had recurring losses from operations, negative cash flows from operating activities and has an accumulated deficit. These conditions 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/xTML05 About Access Pharmaceuticals Access Pharmaceuticals, Inc., develops pharmaceutical products primarily based upon its nano-polymer chemistry technologies and other drug delivery technologies. The Company currently has one approved product, one product candidate at Phase 3 of clinical development, three product candidates in Phase 2 of clinical development and other product candidates in pre-clinical development. ADVANCED MICRO DEVICES: Incurs $20 Million Loss in First Quarter ---------------------------------------------------------------- Advanced Micro Devices Inc. reported a net loss of $20 million on $1.39 billion of net revenue for the quarter ended March 29, 2014, as compared with a net loss of $146 million on $1.08 billion of net revenue for the quarter ended March 30, 2013. As of March 29, 2014, the Company had $4.10 billion in total assets, $3.59 billion in total liabilities and $511 million in total stockholders' equity. "AMD continued our momentum by building on the solid foundation we set in the second half of 2013, further transforming the company," said Rory Read, AMD president and CEO. "Backed by our powerful x86 processor cores and hands-down best graphics experiences, we achieved 28 percent revenue growth from the year-ago quarter. We are well positioned to continue to grow profitably as we diversify our business and enable our customers to drive change and win." A copy of the press release is available for free at: http://is.gd/l6Nyh4 Tender Offer Amendment Advanced Micro filed an amendment to its tender offer statement on Schedule TO originally filed with the U.S. Securities and Exchange Commission on Feb. 20, 2014, as amended, in connection with its offer to purchase for cash, on the terms and subject to the conditions set forth in the Offer to Purchase, dated Feb. 20, 2014, and related Letter of Transmittal, on a pro rata basis, up to $425,000,000 aggregate principal amount of AMD's outstanding 6.00 percent Convertible Senior Notes due 2015. The first paragraph of the section of the Offer to Purchase titled "Trading Market for the Notes and Common Stock" is amended and restated as follows: "There is no established public reporting or trading system for the Notes, and trading in the Notes has been limited. On February 7, 2014, the Company repurchased in open market transactions $17 million in aggregate principal amount of the Notes for $18 million, at a purchase price of $1,049 for each $1,000 principal amount of Notes. On February 11, 2014, the Company repurchased in open market transactions $47 million in aggregate principal amount of the Notes for $49 million, at a purchase price of $1,051 for each $1,000 principal amount of Notes." The section titled "Purpose of the Offer" in the Offer to Purchase is amended and supplemented by the following information: "We are making the Offer in order to acquire, on a pro rata basis, up to the Maximum Tender Amount of the outstanding Notes as part of an overall plan to extend the maturity of a portion of our outstanding debt by repurchasing the Notes in this Offer, as well as a portion of the 8.125% Notes in a concurrent tender offer, in each case using net proceeds we received from the New Notes Offering. We will deliver the Notes that we purchase in the Offer to the Trustee for cancellation, and those Notes will cease to be outstanding. Any Notes that remain outstanding after the Offer will continue to be our obligations. Holders of those outstanding Notes will continue to have all the rights associated with those Notes. We are not seeking the approval of Holders for any amendment to the Notes or the Indenture." A copy of the Schedule TO, as amended, is available for free at: http://is.gd/904xO6 About Advanced Micro Devices Sunnyvale, California-based Advanced Micro Devices, Inc., is a global semiconductor company. The Company's products include x86 microprocessors and graphics. Advanced Micro incurred a net loss of $83 million on $5.29 billion of net revenue for the year ended Dec. 28, 2013, as compared with a net loss of $1.18 billion on $5.42 billion of net revenue for the year ended Dec. 29, 2012. * * * In August 2013, Standard & Poor's Ratings Services revised its outlook on Advanced Micro to negative from stable. At the same time, S&P affirmed its 'B' corporate credit and senior unsecured debt ratings on AMD. As reported by the TCR on Feb. 4, 2014, Fitch Ratings has affirmed the 'CCC' long-term Issuer Default Rating (IDR) for Advanced Micro Devices Inc. The rating reflects Fitch's expectations for negative near-term free cash flow (FCF) and limited top-line visibility, despite solid product momentum heading into 2014. In the Feb. 4, 2013, edition of the TCR, Moody's Investors Service lowered Advanced Micro Devices' corporate family rating to B2 from B1. The downgrade of the corporate family rating to B2 reflects AMD's prospects for weaker operating performance and liquidity profile over the next year as the company commences on a multi- quarter strategic reorientation of its business in the face of a challenging macro environment and a weak PC market. AFFIRMATIVE INSURANCE: Eric Rahe Elected to Board of Directors -------------------------------------------------------------- Affirmative Insurance Holdings, Inc.'s Board of Directors elected Eric Rahe a director of the Company. Mr. Rahe is a managing mirector at J.C. Flowers & Co. LLC. J.C. Flowers & Co. LLC is an affiliate of New Affirmative, LLC, the Company's majority shareholder. From 2008 until 2014, Mr. Rahe was a managing director at Clayton, Dubilier & Rice, where he established and led the firm's financial services practice. Previously, Mr. Rahe was a senior investment professional at the hedge fund SAB Capital and a Partner at Capital Z Partners, a financial services focused private equity firm. Mr. Rahe has served on the boards of Permanent General, a non-standard auto insurance company, and Instant Insurance Holdings, Inc., the former name of the Company. Mr. Rahe holds an A.B., magna cum laude, in Economics from Harvard College, and an M.B.A. from Harvard Business School. About Affirmative Insurance Addison, Tex.-based Affirmative Insurance Holdings, Inc., is a distributor and producer of non-standard personal automobile insurance policies for individual consumers in targeted geographic markets. Non-standard personal automobile insurance policies provide coverage to drivers who find it difficult to obtain insurance from standard automobile insurance companies due to their lack of prior insurance, age, driving record, limited financial resources or other factors. Non-standard personal automobile insurance policies generally require higher premiums than standard automobile insurance policies for comparable coverage. Affirmative Insurance reported net income of $30.71 million in 2013 following a net loss of $51.91 million in 2012. As of Dec. 31, 2013, the Company had $386.84 million in total assets, $489.73 million in total liabilities and a $102.89 million total stockholders' deficit. KPMG LLP, in Dallas, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company's recent history of recurring losses from operations and its probable failure to comply with certain financial covenants in the senior secured and subordinated credit facilities in 2014 raise substantial doubt about its ability to continue as a going concern. ALION SCIENCE: Amends Form S-1 Prospectus ----------------------------------------- Alion Science and Technology Corporation filed with the U.S. Securities and Exchange Commission an amended Form S-1 registration statement relating to: -- the offer to exchange all of its Outstanding $235,000,000 10.25 percent senior notes due 2015 and the related guarantees for an aggregate of up to $235,000,000 of its Third-Lien Senior Secured Notes due 2019 and the Related Guarantees (together with up to 940,000 Warrants to Purchase up to 3,087,029 Shares of Common Stock) and up to $20,000,400 in Cash and the Solicitation of Consents; and -- Unit Offering of up to 9,454 Units consisting of an aggregate of up to $9,454,000 of its Third-Lien Senior Secured Notes due 2019 and the Related Guarantees (together with up to 37,816 Warrants to Purchase up to 141,274 Shares of Common Stock) available to holders of Old Notes. The Company amended the Registration Statement to delay its effective date. The Exchange Offer and Consent Solicitation will expire at 9:00 a.m., New York City time, on [ ], 2014, unless extended by the Company. Holders who tender Old Notes at or prior to 5:00 p.m., New York City time, on [ ], 2014, unless extended by the Company, will receive an Early Tender Payment. Tenders of Old Notes may be withdrawn at or prior to 5:00 p.m., New York City time, on [ ], 2014, unless extended by the Company, but not thereafter. The Unit Offering will expire on the Early Tender Date. The election to purchase Units in the Unit Offering cannot be revoked except that a valid withdrawal of Old Notes in the Exchange Offer will be deemed to have revoked any election to purchase Units in the Unit Offering. A copy of the Form S-1 prospectus, as amended, is available for free at http://is.gd/mO5bCT About Alion Science Alion Science and Technology Corporation, based in McLean, Virginia, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. Alion Science has been reporting losses for four consecutive years from Sept. 30, 2010, to Sept. 30, 2013. In 2013, Alion Science incurred a net loss of $36.59 million. Deloitte & Touche LLP, in McLean, Virginia, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2013. The independent auditors noted that the Company does not expect to be able to repay its existing debt at their scheduled maturities. The Company's financing needs, its recurring net losses, and its excess of liabilities over assets raise substantial doubt about its ability to continue as a going concern, the auditors stated. As of Dec. 31, 2013, the Company had $599.39 million in total assets, $787.09 million in total liabilities, $61.89 million in redeemable common stock, $20.78 million in common stock warrants, $130,000 in accumulated other comprehensive loss and a $270.51 million accumulated deficit. "Our liabilities exceed our assets which makes refinancing our debt more difficult and expensive. Operating cash flow is insufficient to repay the Secured and Unsecured Notes at maturity, which raises substantial doubt as to the Company's ability to continue as a going concern," the Company said in the Form 10-Q. Bankruptcy Warning Management's cash flow projections indicate that absent a refinancing transaction or series of transactions, the Company will be unable to pay the principal and accumulated unpaid interest on its Secured Notes and Unsecured Notes when those instruments mature in November 2014 and February 2015, respectively. On Dec. 24, 2013, Alion entered into an agreement with the holders of a majority of its Unsecured Notes regarding certain possible refinancing transactions. The proposed refinancing transactions involve: replacing Alion's credit facility; refinancing the Secured Notes with $350 million in new secured term loans; exchanging our Unsecured Notes for either new third lien notes and a series of new warrants, or a limited amount of cash for a portion of Unsecured Notes at a price below par; payment of accrued and unpaid interest; and obtaining certain consents from Unsecured Noteholders. "However, management can provide no assurance that we will be able to enter into definitive agreements regarding the terms of the refinancing transactions or conclude a refinancing of our Unsecured Notes, or that additional financing will be available to retire or replace our Secured Notes, and if available, that terms of any transaction would be favorable or compliant with the conditions for such financing set forth in the Refinancing Support Agreement. The Company's high debt levels, of which $332.5 million matures on November 1, 2014 and Alion's recurring losses will likely make it more difficult for Alion to raise capital on favorable terms and could hinder its operations. Further, default under the Unsecured Note Indenture or the Secured Note Indenture could allow lenders to declare all amounts outstanding under the revolving credit facility, the Secured Notes and the Unsecured Notes to be immediately due and payable. Any event of default could have a material adverse effect on our business, financial condition and operating results if creditors were to exercise their rights, including proceeding against substantially all of our assets that secure the Credit Agreement and the Secured Notes, and will likely require us to invoke insolvency proceedings including, but not limited to, a voluntary case under the U.S. Bankruptcy Code," the Company said in its quarterly report for the period ended Dec. 31, 2013. * * * As reported by the TCR on March 10, 2014, Standard & Poor's Ratings Services said it lowered its corporate credit rating on McLean, Va.-based Alion Science and Technology Corp. to 'CC' from 'CCC+'. "The ratings downgrade reflects a capital structure that matures within 12 months, a currently 'weak' liquidity assessment, which we revised from 'less than adequate', and our expectation that we would classify an exchange offer or similar restructuring undertaken by Alion as distressed," said Standard & Poor's credit analyst Martha Toll-Reed. ALLIED INDUSTRIES: Wants Cash Collateral Use Extended to July 31 ---------------------------------------------------------------- Allied Industries, Inc., seeks authority from the Bankruptcy Court to continue to use its cash collateral through July 31, 2014. At present, the Debtor has permission to cash collateral access through April 30, 2014. The Debtor asserts that its hard work has paid off -- citing that insurance sales are increasing, new contracts for Southern California Gas Company are right on track, and the pipeline of new commercial projects has already exceeded $1 million. Revenue growth in the three income streams, the Debtor avers, will collectively generate the profit and cash flow necessary to fund a plan of reorganization. The Debtor believes it is in a position to seek authorization for final use of cash collateral. California United Bank likely disagrees, as may many creditors, the Debtor says. As a fair compromise, the Debtor seeks an additional 90 days so that it can improve its profitability to the Bank and make all creditors comfortable with its reorganization. Parties React California United Bank and the Official Committee of Unsecured Creditors filed separate court papers in relation to the Debtor's request. The Bank reports that all grounds for objection to the Debtor's Motion have been successfully resolved through the negotiation of terms acceptable to both Debtor and the Bank for a new cash collateral order. The Committee, on the other hand, says, "No amount of pie charts or graphics can detract from the fact that the Debtor has been cash flow negative for the past several months and is projected to remain cash flow negative through May 2014." On top of the operating losses, the Committee continues, the Debtor continues to incur significant unpaid administrative liabilities of at least $600,000 to estate professionals plus potentially more to third party vendors. The Committee is concerned that unsecured creditors continue to be prejudiced as administrative claims increase and incurring an additional 90 days of administrative costs will not change the fact that the Debtor, in all likelihood, will be unable to confirm a plan of reorganization at the end of such time period. Thus, the Committee seeks denial of the Debtor's request. The Court was scheduled to hear the Debtor's request at an April 24 hearing. About Allied Industries Allied Industries, Inc., filed a Chapter 11 petition (Bankr. C.D. Cal. Case. No. 13-11948) on March 21, 2013. The petition was signed by Ernesto Gutierrez as president and chief executive officer. The Debtor scheduled assets of $13,086,216 and scheduled liabilities of $7,457,365. The Debtor has tapped Dheeraj K. Singhal, Esq., and Dixon L. Gardner, Esq. at DCDM Law Group, P.C., as counsel, the Capital Turnaround Group, Inc., as turnaround consultant, and Glenn M. Gelman & Associates as accountants. Desmond, Marcello & Amster is business valuation appraiser to the Debtor and RLS, Inc., dba Hjelmstrom & Associates, is its assets appraiser. The Official Committee of Unsecured Creditors has retained Pachulski Stang Ziehl & Jones LLP as counsel and CohnReznick LLP as financial advisor. California United Bank is the Debtor's secured creditor. It is represented by Russell H. Rapoport, Esq. and Alan M. Mirman, Esq. of Mirman, Bubman & Nahmias, LLP, of Woodland Hills, California. AMERICAN APPAREL: Regains Compliance with NYSE Listing Rule ----------------------------------------------------------- American Apparel, Inc., received a letter from the NYSE MKT LLC indicating that the Company has resolved the continued listing deficiency previously identified by the Exchange. The NYSE previously informed the Company it was not in compliance with the continued listing standards of the Exchange set forth in Section 1003(a)(iv) of the NYSE MKT LLC Company Guide. About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. As of September 2010, American Apparel employed over 10,000 people and operated 278 retail stores in 20 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea and China. Amid liquidity problems and declining sales, American Apparel in early 2011 reportedly tapped law firm Skadden, Arps, Slate, Meagher & Flom and investment bank Rothschild Inc. for advice on a restructuring. In April 2011, American Apparel said it raised $14.9 million in rescue financing from a group of investors led by Canadian financier Michael Serruya and private equity firm Delavaco Capital Corp., allowing the casual clothing retailer to meet obligations to its lenders for the time being. Under the deal, the investors were buying 15.8 million shares of common stock at 90 cents apiece. The deal allows the investors to purchase additional 27.4 million shares at the same price. The Company incurred a net loss of $37.27 million in 2012, as compared with a net loss of $39.31 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $332.93 million in total assets, $389.12 million in total liabilities and a $56.19 million total stockholders' deficit. * * * As reported by the Troubled Company Reporter on Feb. 26, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating to 'CCC' from 'B-' on Los Angeles-based American Apparel Inc. The outlook is developing. The Troubled Company Reporter, on Nov. 21, 2013, reported that American Apparel Inc. had its corporate family rating cut one level to Caa2 by Moody's Investors Service. The clothing retailer's probability of default was also lowered one level and the outlook is negative. AMERICAN BIO MEDICA: Liggett Vogt Again Raises Going Concern Doubt ----------------------------------------------------------------- American Bio Medica Corporation had a net loss of $0.79 million on $8.89 million of revenues in 2013, compared with a net loss of $1.11 million on $9.34 million of revenues in 2012, according to a Form 10-K filed with the U.S. Securities and Exchange Commission. Liggett Vogt & Webb P.A. expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred recurring operating losses and will have to obtain additional financing and or refinance certain debts maturing in 2014. Liggett Vogt also issued a going-concern qualification last year, noting of the company's operating losses and maturing debt. The Company's balance sheet at Dec. 31, 2013, showed $4.97 million in total assets, $3.63 million in total liabilities, and stockholders' equity of $1.34 million. A copy of the Form 10-K is available at: http://is.gd/y2T2FM Kinderhook, New York-based American Bio Medica Corporation develops, manufactures and sells immunoassay tests, primarily for the immediate, point of collection testing ("POCT") for drugs of abuse ("DOA") in urine and oral fluids. In addition to the manufacture and sale of DOA testing products, the Company provides bulk test strip contract manufacturing services for other POCT companies. AMERICAN ROCK: S&P Affirms 'B-' CCR & Rates $350MM Loan 'B' ----------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'B-' corporate credit rating on U.S.-based American Rock Salt Co. The outlook is stable. S&P also assigned its 'B' issue rating to the company's proposed $350 million first-lien term loan with a recovery rating of '2', indicating that lenders would receive a substantial (70%-90%) recovery in the event of a payment default. At the same time, S&P assigned its 'CCC' issue rating to the company's proposed $120 million second-lien term loan with a '6' recovery, indicating that lenders would receive a negligible 0%- 10% recovery in the event of a payment default. "The stable rating outlook reflects our view that the company will post good operating results in 2014 but still maintain a highly leveraged financial profile. We also assume that management will maintain tax distributions at levels consistent with our expectations with no material debt-financed dividends," said Standard & Poor's credit analyst Funmi Afonja. "Our stable outlook also assumes weather patterns in line with historical averages." S&P would consider a negative rating action if, over the next 12 months, American Rock Salt's liquidity deteriorated due to weaker- than-expected operating performance during a mild winter in its service area. Specifically, S&P could lower the rating if it believed the company were likely to violate its covenants or if its interest coverage ratio fell to less than 1x. A positive rating action is unlikely in the near term based on S&P's expectation that American Rock Salt will remain highly leveraged for the next several years. However, S&P could raise the rating if it achieved a sustainable improvement in credit measures, with leverage of less than 5x and FFO to debt more than 12%. Any upgrade would likely be limited to one notch due to S&P's assessment of the vulnerable business risk profile, which is constrained by the company's limited diversity, seasonal demand, and weather-related volatility. ANDALAY SOLAR: Board Appoints Steven Chan as CEO ------------------------------------------------ Andalay Solar, Inc.'s Board of Directors has appointed Steven Chan as CEO and president, effective April 22, 2014. Mr. Chan will be tasked with the full commercialization of the Andalay Solar product offering and deepening its distribution globally in addition to many initiatives the Board has presented him. As a solar industry veteran with years of experience at NRG Energy, GCL-Poly Energy Holdings Limited and Suntech Power Holdings Co., Ltd, the Board believes this appointment to be a critical step in the furtherance of the Andalay product line. In connection with his appointment, Mr. Chan entered into an employment agreement with the Company date April 14, 2014. Pursuant to the Employment Agreement, Mr. Chan will be entitled to an annual base salary of $250,000 and will be eligible for discretionary performance bonus payments. Mr. Chan commented, "I am very excited to be asked to lead Andalay Solar as I believe its innovative core product positions it well for the long term as it both meaningfully reduces installation costs as well as streamlines and improves installation reliability in ways that are superior to its peers. My immediate focus will be on accelerating the growth of Andalay's sales and related channels as I have done in my prior roles within the solar industry." Mr. Mark Kalow, Chairman of the Board and head of the search committee, commented, "After an extensive search covering many candidates, it was clear that the next leader of Andalay Solar should be Steven Chan as unanimously approved by the Board of Directors. We look forward to Steve's leadership of this Company, now poised for accelerated future growth." Prior to his appointment as CEO and president of Andalay Solar, Mr. Chan, age 46, served as the vice president of NRG Energy (NYSE: NRG) from May 2012 to November 2013 serving as head of residential solar for its NRG Residential Solar Solutions business. Mr. Chan created the strategy and built a team and operation to enable NRG to become a leader in residential solar lease financing. This included raising over $100 million of solar lease funding, selling residential solar leases to NRG's retail electric customers and creating a NRG-branded dealer program of qualified installation partners to market to homeowners throughout the US. Mr. Chan served as EVP, Strategy and System Sales at GCL- Poly Energy Holdings Limited (Hong Kong: 3800) from September 2011 to May 2012 where he helped to build out a system sales division for GCL in North America including establishing and serving as a board member at Sunora Energy Solutions, a joint venture with NRG Energy to focus on utility and commercial solar installations. From 2006 until 2011 he held various positions at Suntech Power Holdings Co., Ltd. (OTC: STPFQ), which included serving as the President of Suntech America and as Suntech's president of Global Sales and Marketing, chief strategy officer and VP Business Development. At Suntech, Mr. Chan was instrumental to building the US and European teams and sales channels that enabled Suntech to achieve #1 global market share including selling over 20+ percent of all modules sold in North America in 2011 with 500MW sold up exponentially from 25MW in 2007. Prior to joining Suntech, Mr. Chan worked for five years at CDC Corporation, a NASDAQ-listed, Greater China-based enterprise software and online/mobile services company, most recently serving as its Acting CEO and previously as its General Counsel and Company Secretary. Prior to that, Mr. Chan was a New York- qualified corporate attorney with Morrison & Forester LLP and Milbank, Tweed, Hadley & McCloy LLP. Mr. Chan earned an AB degree in political economy (high honors) from the University of California at Berkeley and received a JD law degree from the Boston College Law School. Details of the Company's employment agreement with Mr. Chan were provided in a Form 8-K on April 16, 2014, a copy of which is available for free at http://is.gd/8vSInU "The Board would like to thank Margaret Randazzo for presiding over the past two years which have culminated in higher sales and the financial restructuring of the Company which should ensure the continued capitalization of the Company for the foreseeable future. Margaret will continue in her role as CFO until June 30th of this year and will remain on the Board of Directors as previously announced," the Company stated in a press release. About Andalay Solar Founded in 2001, Andalay Solar, Inc., formerly Westinghouse Solar, Inc., is a provider of innovative solar power systems. In 2007, the Company pioneered the concept of integrating the racking, wiring and grounding directly into the solar panel. This revolutionary solar panel, branded "Andalay", quickly won industry acclaim. In 2009, the Company again broke new ground with the first integrated AC solar panel, reducing the number of components for a rooftop solar installation by approximately 80 percent and lowering labor costs by approximately 50 percent. This AC panel, which won the 2009 Popular Mechanics Breakthrough Award, has become the industry's most widely installed AC solar panel. A new generation of products named "Instant Connect" was introduced in 2012 and is expected to achieve even greater market acceptance. Burr Pilger Mayer, Inc., in San Francisco, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing significant operating losses and negative cash flow from operations that raise substantial doubt about its ability to continue as a going concern. Westinghouse Solar disclosed a net loss of $8.62 million on $5.22 million of net revenue in 2012, as compared with a net loss of $4.63 million on $11.42 million of net revenue in 2011. The Company's balance sheet at Sept. 30, 2013, showed $3.34 million in total assets, $6.24 million in total liabilities, $180,468 in series A convertible redeemable preferred stock, $1.02 million in series D convertible preferred stock, and a $4.11 million total stockholders' deficit. ANTERO RESOURCES: Moody's Rates New $500MM Unsecured Notes 'B1' --------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Antero Resources Corporation's proposed $500 million senior unsecured notes due 2022. Net proceeds from the notes offering will be used to redeem its outstanding 7.25% senior notes due 2019 and to repay a portion of the outstanding borrowings under its senior secured revolving credit facility. The rating outlook is stable. "Moody's views this proposed transaction as a straight refinancing of more expensive debt, while extending the company's debt maturity profile," stated Michael Somogyi, Moody's Vice President -- Senior Analyst. "Balanced funding of high capital spending to support its aggressive development program and midstream infrastructure investments is crucial to support further credit migration." Issuer: Antero Resources Corporation Assignment $500 million Senior Unsecured Debentures / Bonds due 2022, assigned B1 (LGD 4, 69%) Ratings Rationale The B1 rating on Antero's senior notes reflects both Antero's overall probability of default, to which Moody's previously assigned a PDR of Ba3-PD, and a loss given default of LGD 4 (69%). Net proceeds from the new $500 million proposed notes offering will be used to redeem Antero's $260 million 7.25% senior notes due 2019 and to repay a portion of the outstanding borrowings under its senior secured revolving credit facility. Antero also has $525 million of senior notes due 2020 and $1.0 billion of senior notes due 2021. The $2.025 billion of senior notes are unsecured and are subordinated to the $2.0 billion senior secured credit facility's, with current lender commitments of $1.5 billion, potential priority claim to the company's assets. The size of the potential senior secured claims relative to the unsecured notes outstanding results in the senior notes being notched one rating below the Ba3 CFR under Moody's Loss Given Default Methodology. Antero's Ba3 CFR reflects its low leverage profile, visible production growth, growing size of the company's proved reserve base, and low cost structure driving improved capital efficiency and cash flows. The rating is restrained by Antero's small ratio of proved developed to total proved reserve base, concentrated reserve base, natural gas weighted production profile and continued reliance on external funding sources to finance its development program and midstream infrastructure investments. Antero has realized strong production growth driven by its successful development efforts across its core Marcellus acreage position. Average daily production in 2013 was 87,000 barrels of oil equivalent (BOE), up sharply from around 40,000 BOE per day in 2012. Moody's believe this positive trend in production growth will continue and are forecasting daily production volumes to approach 150,000 BOE in 2014 and to exceed 220,000 BOE in 2015 further supported by additional contracted takeaway capacity including Kinder Morgan Energy Partners, L.P.'s (Baa2 stable) Tennessee Gas Pipeline Company (Baa1 stable) of approximately 100,000 BOE per day by 2015 and growing to over 130,000 BOE per day by 2017. Antero aims to grow organically through the accelerated development of its core properties in the Marcellus and Utica Shale plays. The company recently raised its 2014 capital budget by $150 million to $2.75 billion, with $1.8 billion dedicated for drilling and completion, $750 million for midstream infrastructure and water handling investments and $200 million for leasehold acreage acquisitions. This high level of capital spending will continue to extend Antero's negative free cash flow operating profile, requiring external financing until production gains are realized. Antero's plan for an IPO of its midstream business as a master limited partnership (MLP) could also provide for additional funding options. The SGL-3 Speculative Grade Liquidity Rating reflects adequate liquidity. Pro forma for the new $500 million senior notes offering, Antero will have access to about $1.4 billion under its bank revolving credit facility, subject to a $1.5 billion lender commitment amount. Moody's expect Antero to continue to outspend internally generated cash flow by over $1.0 billion over the next 12-18 months and to remain reliant on its revolver to fund capital expenditures. The revolving credit facility matures in May 2016. It requires that Antero maintain a minimum current ratio of 1.0x and a minimum interest coverage ratio of 2.5x. Moody's expect Antero to remain well in compliance with these covenant ratios. The stable outlook reflects Moody's expectation that while Antero's debt balance increases, reserve additions and increased production will keep pace with the increase in borrowings, keeping the ratios of debt / proved developed reserves and debt / production at around $20,000 - $22,000 per BOE and $8.00 - $10.00 per BOE, respectively, through mid-2015. An upgrade could be considered if debt / average daily production is sustained below $20,000 per BOE and debt / proved-developed reserves is sustained below $8.00 per BOE. An upgrade would also be contingent on Antero maintaining unleveraged cash margins greater than $25.00 per BOE and retained cash flow to debt over 40% as it builds out infrastructure needs to support production growth. A downgrade is possible if debt / average daily production exceeds $27,000 per BOE and debt / proved developed reserves exceeds $10.50 per BOE on a sustained basis. Antero Resources LLC is headquartered in Denver, Colorado and is engaged in the exploration and production of oil, natural gas liquids and natural gas. ANTERO RESOURCES: S&P Rates $500M Sr. Unsecured Notes 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'BB-' issue-level rating (same as the corporate credit rating) and '4' recovery rating to Denver, Colo.-based Antero Resources Corp.'s proposed $500 million senior unsecured notes due 2022. The '4' recovery rating indicates S&P's expectation of average (30% to 50%) recovery in the event of default. At the same time S&P revised the recovery rating on the company's existing senior notes to '4' from '3'. The issue rating on these notes remains 'BB-'. The company plans to use the proceeds from the proposed notes to redeem its $260 million 7.25% senior notes due 2019 and to repay a portion of its borrowings under its credit facility. The ratings on Denver-based oil and gas exploration and production company Antero Resources Corp. reflect S&P's assessment of the company's "fair" business risk and "aggressive" financial risk. The ratings incorporate the company's participation in the competitive and highly cyclical oil and gas industry, its high percentage of proved undeveloped (PUD) reserves, the significant capital spending associated with the development of its proved undeveloped reserve base, and its high concentration of low-priced natural gas in its reserves and production. The ratings on Antero also incorporate its low cash operating costs and finding and development costs; strong reserve replacement performance; solid production growth; and the expectation that Antero will continue to expand its reserve base, which totaled 7.6 trillion cubic feet equivalent as of year-end 2013. Ratings List Antero Resources Corp. Corporate Credit Rating BB-/Positive/-- New Rating Antero Resources Corp. $500 mil sr unsecd nts due 2022 BB- Recovery Rating 4 Recovery Rating Revised TO FROM Antero Resources Corp. Senior Notes BB- BB- Recovery Rating 4 3 API TECHNOLOGIES: Redeems All Series A Stock for $27.6 Million -------------------------------------------------------------- API Technologies Corp. redeemed all of its Series A Preferred Stock for $27.6 million. Additionally, the Company amended its credit agreement with Guggenheim Corporate Funding, LLC, as administrative agent, to provide for an additional $55 million term loan. The proceeds of the incremental term loan were primarily used to redeem the Series A Preferred Stock and to pay off the Company's asset backed revolving loan facility. Bel Lazar, president and chief executive officer of API Technologies said: "This transaction results in an immediate reduction in API's net liabilities and simplifies our capital structure without incurring any dilution to our equity holders." About API Technologies API Technologies designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. API Technologies' customers include many leading Fortune 500 companies. API Technologies trades on the NASDAQ under the symbol ATNY. For further information, please visit the Company Web site at www.apitech.com. For the nine months ended Aug. 31, 2013, the Company reported net income of $15,000 on $185.16 million of net revenue. For the 12 months ended Nov. 30, 2012, the Company reported a net loss of $148.70 million, as compared with a net loss of $17.32 million during the prior year. As of Nov. 30, 2013, the Company had $304.57 million in total assets, $147.14 million in total liabilities, $26.32 million in redeemable preferred stock and $131.10 million in shareholders' equity. * * * As reported by the TCR on Feb. 14, 2013, Moody's Investors Service has withdrawn all ratings of API Technologies Corp., including its Caa1 Corporate Family Rating and negative outlook due to the repayment of all rated debt. On Feb. 6, 2013, API Technologies Corp. completed a refinancing of its previously outstanding rated bank debt. All ratings of API have been withdrawn since the company has no rated debt outstanding. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on API Technologies Corp. to 'B-' from 'B'. "The downgrade reflects weaker-than-expected credit metrics resulting from less-than-expected improvements in operating performance and higher debt, including a modest increase from the recent refinancing," said Standard & Poor's credit analyst Chris Mooney. API TECHNOLOGIES: Douglas Topkis Ceased to Own 5% Equity Stake -------------------------------------------------------------- In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission, BET Funding LLC, Douglas Topkis and Bruce E. Toll disclosed that as of March 21, 2014, they ceased to be the beneficial owner of more than five percent of API Technologies Corp.'s common stock. Mr. Topkis reported beneficial ownership of 100,000 common shares or 0.18 percent equity stake as of March 21. The reporting persons previously owned 4,433,333 common shares at Feb. 1, 2013. A copy of the amended regulatory filing is available for free at http://is.gd/glUHhU About API Technologies API Technologies designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. API Technologies' customers include many leading Fortune 500 companies. API Technologies trades on the NASDAQ under the symbol ATNY. For further information, please visit the Company Web site at www.apitech.com. For the nine months ended Aug. 31, 2013, the Company reported net income of $15,000 on $185.16 million of net revenue. For the 12 months ended Nov. 30, 2012, the Company reported a net loss of $148.70 million, as compared with a net loss of $17.32 million during the prior year. As of Nov. 30, 2013, the Company had $304.57 million in total assets, $147.14 million in total liabilities, $26.32 million in redeemable preferred stock and $131.10 million in shareholders' equity. * * * As reported by the TCR on Feb. 14, 2013, Moody's Investors Service has withdrawn all ratings of API Technologies Corp., including its Caa1 Corporate Family Rating and negative outlook due to the repayment of all rated debt. On Feb. 6, 2013, API Technologies Corp. completed a refinancing of its previously outstanding rated bank debt. All ratings of API have been withdrawn since the company has no rated debt outstanding. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on API Technologies Corp. to 'B-' from 'B'. "The downgrade reflects weaker-than-expected credit metrics resulting from less-than-expected improvements in operating performance and higher debt, including a modest increase from the recent refinancing," said Standard & Poor's credit analyst Chris Mooney. ASHLEY STEWART: Court Approves Sale of Assets to Clearlake Unit --------------------------------------------------------------- Judge Michael B. Kaplan of the U.S. Bankruptcy Court for the District of New Jersey approved the asset purchase agreement between Ashley Stewart Holdings, Inc., et al., and Butterfly Acquisition Co. Inc., an affiliate of Clearlake Capital Group, LP. Butterfly Acquisition will pay $18 million and assume certain liabilities, including cure payments up to an aggregate amount not to exceed $3 million. Proceeds of the sale will be used to pay off what the Debtors owe under their $17.5 million bankruptcy loan. A settlement with unsecured creditors and secured lenders sets out a "waterfall" scheme to pay the remainder of the sale proceeds out to high-priority creditors, then the retailer's bondholders and unsecured creditors. Bill Rochelle, the bankruptcy columnist for Bloomberg News, said the sale price covers the $15.9 million owed to Salus Capital Partners LLC on a senior secured asset-based loan facility. The proceeds don't satisfy $17.9 million on senior and junior subordinated notes owed to an affiliate of Gordon Brothers Group LLC, which acquired the business in 2010 in the bankruptcy of Urban Brands Inc., Mr. Rochelle noted. In return for releases, Salus and Gordon Brothers are allowing some sale proceeds to pay expenses of the case and claims entitled to priority under bankruptcy law, Mr. Rochelle added. The settlement also provided for funding bonuses the company proposed for 10 senior managers, which the court also approved, the Bloomberg report related. The Court overruled objections to the sale including objections from Canon Financial Services, Inc., Delta Dental Plan of NJ, Inc., KIR Augusta II LP, Kimco Baton Rouge 1183, LLC, and Northline Commons LLC; Bawabeh Brothers II, LLC, Ramco Jacksonville, LLC and Ramco-Gershenson Properties, L.P., TCCI Broad Street LLC and Glenwood Crossing LLC, and Wells Fargo Bank, National Association, with respect to the proposed sale. About Ashley Stewart The Ashley Stewart name is synonymous with offering women who wear sizes 12 and up well-made fashionable clothes at affordable prices. Ashley Stewart Holdings Inc. and affiliates New Ashley Stewart Inc., AS IP Holdings Inc. and NAS Gift LLC filed Chapter 11 petitions in Newark, New Jersey (Bankr. D.N.J. Case Nos. 14-14383 to 14-14386) on March 10, 2014. Michael A. Abate signed the petitions as senior vice president finance/treasurer. Ashley Stewart Holdings estimated assets and liabilities of at least $10 million. The Hon. Michael B. Kaplan oversees the case. Curtis, Mallet-Prevost, Colt & Mosle LLP serves as the Debtors' general counsel. Cole, Schotz, Meisel, Forman & Leonard, P.A., is the Debtors' local counsel. PricewaterhouseCoopers LLP acts as the Debtors' financial advisor. Prime Clerk LLC serves as the Debtors' claims and noticing agent. Ashley Stewart has obtained authority to conduct store closing sales at 27 locations around the United States in accordance with a consulting agreement with Gordon Brothers Retail Partners, LLC. BANK OF THE CAROLINAS: Incurs $1.4 Million Net Loss in 2013 ----------------------------------------------------------- Bank of the Carolinas Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss available to common stockholders of $1.39 million on $15.20 million of total interest income for the year ended Dec. 31, 2013, as compared with a net loss available to common stockholders of $5.53 million on $17.04 million of total interest income for the year ended Dec. 31, 2012. The Company incurred a net loss available to common stockholders of $29.18 million in 2011. As of Dec. 31, 2013, the Company had $426.68 million in total assets, $421.90 million in total liabilities and $4.77 million in total stockholders' equity. Turlington and Company, LLP, in Lexington, North Carolina, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has suffered recurring credit losses that have eroded certain regulatory capital ratios. As of Dec. 31, 2013, the Company is considered undercapitalized based on their regulatory capital level. This raises 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/SLlD56 About Bank of the Carolinas Mocksville, North Carolina-based Bank of the Carolinas Corporation was formed in 2006 to serve as a holding company for Bank of the Carolinas. The Bank's primary market area is in the Piedmont region of North Carolina. BAY AREA FINC'L: Objects to Lombardo & Safford as Special Counsel ----------------------------------------------------------------- The U.S. Trustee objects to Bay Area Financial Corporation's application to hire Lombardo & Safford LLP as special counsel nunc pro tunc to the Petition Date. Queenie K. Ng, Esq. -- queenie.k.ng@usdoj.gov -- as trial attorney for the U.S. Trustee, points out that as per the Employment Application, the proposed Special Counsel incurred fees totaling $31,080 postpetition and yet the Debtor waited almost four months after the Petition Date to file the Employment Application. She asserts that the proposed Special Counsel provided no reason for the delay in the Employment Application. Since there is no good cause for delay and no extraordinary circumstances, retroactive relief should not be granted in the case, she maintains. Ms. Ng adds that the Employment Application do not specify whether Proposed Special Counsel is seeking compensation under Sec. 328 or 330 as required under the Local Bankruptcy Rules. Moreover, Ms. Ng says, the proposed counsel is not disinterested. She cites that Vincent J. Lombardo, a principal of the proposed Special Counsel, is also an officer of the Debtor, and that Mr. Lombardo is also a creditor of the Debtor with a $73,452 general unsecured claim. Accordingly, the U.S. Trustee asks the Court to deny the Employment Application until his concerns are addressed. About Bay Area Financial Bay Area Financial Corp., a consumer finance company, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 13-38974) on Dec. 9, 2013. The case is assigned to Judge Thomas B. Donovan. The Debtor is represented by Sandford L. Frey, Esq., and Stuart I. Koenig, Esq., at Creim Macias Koenig & Frey LLP, in Los Angeles, California. The Debtor disclosed $15,248,851 in assets and $21,239,663 in liabilities as of the Chapter 11 filing. The U.S. Trustee for Region 16 appointed five members to the Official Committee of Unsecured Creditors. Shulman Hodges & Bastian LLP serves as general counsel of the Committee. BAY CLUB: Gets Final OK to Access CDO's Cash Collateral ------------------------------------------------------- Bankruptcy Judge Randall L. Dunn has authorized, on a final basis, Bay Club Partners-472 LLC's use of cash collateral in which Legg Mason Real Estate CDO I, Ltd., asserts an interest. The Debtor would use the cash collateral in the ordinary course of business as determined solely by MEB Management Services. MEB will notify CDO and the Debtor of proposed capital expenditures. MEB may determine to incur and may pay expenses in excess of the Debtor's historical expenses, including expenditures for capital expenses, so long as such expenditures are subject to MEB's reasonable judgment and good faith. As adequate protection for any diminution in value of the lender's collateral, the Debtor will grant CDO replacement liens with the same extent and with the same relative priority as CDO's prepetition liens and will attach to all property and assets of Debtor and its estate. The Debtor will maintain insurance against loss, theft, destruction and damage to the collateral. Starting June 5, 2014, and on the fifth day of each month thereafter, the Debtor will make a payment to CDO in the amount of $135,000. Additionally, no payments will be made by MEB or the Debtor to any insider or affiliate of the Debtor, except for the payment permitted and monthly payments of $299 to Apartment Marketing Systems, LLC for social media and online marketing services. CDO, in its objection filed on Feb. 28, said the cash collateral budget overstates operating expenses and capital expenses. CDO also said it is not adequately protected unless the Debtor makes monthly interest payments at the non-default rate. About Bay Club Bay Club Partners-472, LLC, was formed to renovate and operate the residential property at 2121 W. Main St., Mesa, Arizona, known as Midtown on Main Street. The property has 470 rental units and offers residents amenities including a fitness center, spa, clubhouse, three swimming pools, a covered play area, assigned parking, and 24-hour emergency maintenance services. As of the bankruptcy filing, the Debtor has leased 91% of the apartments. Bay Club filed a Chapter 11 bankruptcy petition (Bankr. D. Ore. Case No. 14-30394) on Jan. 28, 2014. The Debtor disclosed $28,247,787 in assets and $27,311,084 in liabilities as of the Chapter 11 filing. The case has been assigned to Judge Randall L. Dunn. Attorneys at Tonkon Torp LLP serve as counsel to the Debtor. The U.S. Trustee has not appointed a committee of unsecured creditors. BIOFUEL ENERGY: Incurs $45.6 Million Net Loss in 2013 ----------------------------------------------------- Biofuel Energy Corp. filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $45.65 million for the year ended Dec. 31, 2013, as compared with a net loss of $46.32 million during the prior year. As of Dec. 31, 2013, the Company had $15.65 million in total assets, $4.60 million in total liabilities and $11.05 million in total equity. Grant Thornton LLP, in Denver, Colorado, did not issue a "going cocern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. In their report on the consolidated financial statements for the year ended Dec. 31, 2012, Grant Thornton expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company incurred a net loss of $46.3 million during the year ended Dec. 31, 2012, is in default under the terms of the Senior Debt Facility, and has ceased operations at its Fairmont ethanol facility. These conditions, among 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/n8J0iO About Biofuel Energy Denver, Colo.-based BioFuel Energy Corp. (Nasdaq: BIOF) -- http://www.bfenergy.com/-- aims to become a leading ethanol producer in the United States by acquiring, developing, owning and operating ethanol production facilities. It currently has two 115 million gallons per year ethanol plants in the Midwestern corn belt. BIOLIFE SOLUTIONS: Walter Villger Stake at 36.9% as of March 25 --------------------------------------------------------------- In a Schedule 13D filed with the U.S. Securities and Exchange Commission, Walter Villiger disclosed that as of March 25, 2014, he beneficially owned 5,143,001 shares of the BioLife Solutions, Inc., consisting of 1,374,293 shares of common stock held directly, 1,777,211 shares of common stock held indirectly through WAVI Holdings AG, 214,286 shares of common stock issuable upon exercise of warrants held directly, and 1,777,211 shares of common stock issuable upon exercise of warrants held indirectly through WAVI. Those shares represent a total of 36.9 percent of the Company's outstanding common shares. On Dec. 16, 2013, the Company entered into a note conversion agreement with Mr. Villiger. Mr. Villiger held, as of Dec. 31, 2013, approximately $5.7 million principal amount of outstanding promissory notes and approximately $1.9 million of accrued and unpaid interest under that certain secured convertible multi-draw term loan facility agreement entered into on Jan. 11, 2008. Pursuant to the Note Conversion Agreement, Mr. Villiger agreed to convert on a private placement basis the outstanding indebtedness, including accrued interest thereon in connection with and on substantially similar terms as the Company's next "Qualified Financing", which was defined as the "next offer and sale its equity for cash, provided that a Qualified Financing shall not include any issuance of securities of the Issuer pursuant to compensatory arrangements." On Feb. 11, 2014, Mr. Villiger assigned his respective rights and obligations under the promissory notes, the facility agreement and the Note Conversion Agreement to WAVI Holding AG. On March 25, 2014, the indebtedness under the facility agreements, including accrued interest thereon through the closing date, was converted on a private placement basis into units at a conversion price of $4.30 per unit, concurrently with the closing of the Company's public offering of units at a public offering price of $4.30 per unit. Pursuant to the conversion, WAVI received 1,777,211 units for the conversion of approximately $5.7 million principal amount of outstanding promissory note and $2 million of interest accrued thereon. Each unit consisted of one share of the Company's common stock, $0.001 par value and one common stock warrant. Each warrant is exercisable for 1 common share of the Issuer at $4.75 per share through March 25, 2021. WAVI also released all security and the facility agreements were terminated. A copy of the regulatory filing is available for free at: http://is.gd/tIyOrM About BioLife Solutions Bothell, Washington-based BioLife Solutions, Inc., develops and markets patented hypothermic storage and cryo-preservation solutions for cells, tissues, and organs, and provides contracted research and development and consulting services related to optimization of biopreservation processes and protocols. BioLife Solutions incurred a net loss of $1.08 million in 2013, a net loss of $1.65 million in 2012, and a net loss of $1.95 million in 2011. As of Sept. 30, 2013, the Company had $3.20 million in total assets, $16.06 million in total liabilities and a $12.85 million total shareholders' deficiency. BOREAL WATER: To File 2013 Form 10-K in May ------------------------------------------- Boreal Water Collection, Inc.'s former auditor, Patrick E. Rodgers, had his registration revoked by the Public Accounting Oversight Board on March 6, 2014. One of the consequences of the PCAOB's action regarding Mr. Rodgers is that Boreal Water Collection, Inc., can no longer utilize or rely on Mr. Rodgers' audited financial statements for the fiscal year ending Dec. 31, 2012. As a result, the Company must engage a new PCAOB licensed CPA to audit fiscal year 2012. The Company's Form 10-K filed to date, as well as the 10-K for fiscal year 2013 must contain the new audited financial statements for 2012. The Company said it became aware of Mr. Rodgers' revoked PCAOB registration upon receiving a letter from SEC staff dated March 11, 2014. The date of this notification did not allow the Company enough time to arrange for and complete a new audit for the fiscal year 2012, nor to amend our 2012 10-K and prepare and file our 2013 10-K (that must contain audited financial statements for 2012 and 2013). The Company published an Annual Report on OTC Markets.com on April 15, 2014. This report contains unaudited financial statements. The Company anticipates amending and filing its 2012 10-K and filing its 2013 10-K on or about the end of May, 2014. The Company said it is continuing to do as much as possible to expedite the preparation and filing of these reporting documents. About Boreal Water Kiamesha Lake, N.Y.-based Boreal Water Collection, Inc., is a personalized bottled water company specializing in premium custom bottled water. The Company reported a net loss of $822,902 on $2.7 million of sales in 2012, compared with a net loss of $1.3 million on $2.7 million of sales in 2011. The Company's balance sheet at Sept. 30, 2013, showed $3.58 million in total assets, $2.66 million in total liabilities and $918,250 in total stockholders' equity. Patrick Rodgers, CPA, in his report on the consolidated financial statements for the year ended Dec. 31, 2012, expressed substantial doubt about Boreal Water Collection, Inc.'s ability to continue as a going concern, citing that the Company has a minimum cash balance available for payment of ongoing operating expenses, has experienced losses operations since inception, and it does not have a source of revenue sufficient to cover its operating costs. BROWN MEDICAL: Carr Riggs Okayed as Ch. 11 Trustee's Accountants ---------------------------------------------------------------- The Bankruptcy Court authorized Elizabeth M. Guffy, the Chapter 11 trustee of Brown Medical Center, Inc., to employ Carr, Riggs & Ingram as her accountants. As reported in the Troubled Company Reporter on Feb. 20, 2014, Carr Riggs will provide federal and state income tax services for the Debtor and the Debtor's related for which the Trustee serves as chief restructuring officer. Carr Riggs has agreed to provide services based on the lesser of a flat fee of $1,750 per entity (on a yearly basis) or at Carr Riggs' hourly rates. Carr Riggs will also be reimbursed for reasonable out-of-pocket expenses incurred. Miles D. Harper, III, a partner of Carr Riggs, 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 Brown Medical Houston, Texas-based Brown Medical Center, Inc., is a management company that historically served as the epicenter of the operating business enterprise directly or indirectly owned or controlled by Michael Glyn Brown, including six surgery centers and related facilities. The Company sought protection under Chapter 11 of the Bankruptcy Code on Oct. 15, 2013 (Case No. 13-36405, Bankr. S.D.Tex.). The case is assigned to Judge Marvin Isgur. Brown Medical Center is represented by Spencer D. Solomon, Esq., at Nathan Sommers Jacobs, P.C., in Houston, Texas. In November 2013, the Bankruptcy Court approved the appointment of Elizabeth M. Guffy as Chapter 11 trustee. The trustee hired Porter Hedges LLP, led by Joshua W. Wolfshohl, Esq., John F. Higgins, Esq., and James Matthew Vaughn, Esq., Nick D. Nicholas, Esq., J. Patrick LaRue, Esq., and Craig M. Bergez, as counsel. The trustee tapped The Claro Group, LLC, as financial advisor and consultant. In its schedules, Brown Medical listed $13,807,746 in assets and $27,716,168 in liabilities. Brown Medical owes Crown Financial Funding, LP, the primary secured creditor, pursuant to a pre- bankruptcy promissory note in the original principal amount of $2 million, which indebtedness is secured by a security agreement from Allied Center for Special Surgery, Scottsdale, LLC covering accounts and accounts receivable which the Debtor has the right to collect. BROWN MEDICAL: Ch.11 Trustee Has Stipulation Over Byman CRO ----------------------------------------------------------- Elizabeth M. Guffy, the Chapter 11 trustee for Brown Medical Center, Inc., Ronald J. Sommers, the Chapter 7 trustee for Michael G. Brown, and the Byman Entities entered into a stipulation regarding the appointment of Allison D. Byman as chief restructuring officer. The Byman Entities consist of Allison D. Byman, the chief restructuring officer of Achilles Foot & Ankle Specialists, LLC, Achilles Foot & Ankle Specialists, LLC, Achilles Foot & Ankle Specialists, LLC (AZ), Allied Orthopedics, Phoenix, PA, Rehabilitation & Pain Center, Phoenix, LLC, St. Michael's Center for Special Surgery, Ltd., and Texas Hand Therapy Center, Inc. The parties agree that, among other things: 1. on Jan. 7, 2014, the Court entered an order in the BMC case appointing Ms. Byman as the CRO of the Byman Entities and terminating Ms. Guffy's appointment as CRO of the Byman Entities; 2. BMC's estate is the majority shareholder of St. Michael's Center for Special Surgery, Ltd. Brown's estate is the majority shareholder of the other Byman Entities. 3. Ms. Byman intends to charge her regular hourly rate of $325 for all services rendered on behalf of the Byman Entities and retain the law firm Hughes Watters Askanase LLP as counsel to represent her in matters related to her CRO duties. Ms. Byman, in her discretion, may also retain other professionals, including but not limited to, accountants and brokers to carry out her CRO duties. 4. under no circumstances will the BMC or Brown estates be liable to Ms. Byman or her professionals for their time spent, or expenses incurred, in connection with the Byman Entities. All payments to Ms. Byman or her professionals under the stipulation for fees and expenses will be made solely from funds generated by the Byman Entities, regardless of whether those funds have been swept by Ms. Guffy. A copy of the stipulation is available for free at: http://bankrupt.com/misc/BROWNMEDICALCENTER_348_crostip.pdf As reported in the Troubled Company Reporter on Feb. 26, 2014, Ms. Byman serves as replacement CRO for certain non-debtor entities. The so-called Barrett Creditors and Manuel Guyot filed papers in response to the appointment of CROs for the non-debtor entities. They said it is likely that the Bankruptcy Court does not have the jurisdiction to appoint a CRO for business entities that are not debtors in bankruptcy; and only a Texas state court or a federal district court may appoint a CRO, receiver, or other officers to manage the non-debtor business entities. The Barrett Creditors are Stephen A. Barrett, individually and derivatively as representative of Brown Surgical Investments Partners, Austin, LLC, Brown Surgical Investments Partners, DFW, LLC, Brown Surgical Investments Partners, Las Vegas, LLC, Brown Surgical Investments Partners, San Antonio, LLC, and Brown Surgical Investments Partners, Scottsdale, LLC; Stephen Barrett, DPM, P.A.; Stephen Barrett, DPM, Austin, P.A.; Stephen Barrett, DPM, DFW, P.A.; Stephen Barrett, DPM, San Antonio, P.A.; Barrett Foot and Ankle, P.C.; Charles "Ed" Singleton, individually and derivatively as representative of Brown Surgical Investments Partners, DFW, LLC, and Paul V. Ledesma, individually and derivatively as representative of Brown Surgical Investments Partners, Scottsdale, LLC; and Stephen Barrett, DPM, P.A. Manuel Guyot serves as representative of Brown Executive Partners, Austin, LLC, Brown Executive Partners, DFW, LLC, Brown Executive Partners, Las Vegas, LLC, Brown Executive Partners, San Antonio, LLC, and Brown Executive Partners, Scottsdale, LLC. Raleigh "Ro" Jackson, a creditor and party-in-interest, adopted the response filed by Barrett Creditors and Manuel Guyot in its entirety. The respondents also asked the Court to allow Ms. Guffy to resign as CRO. If the Court cannot appoint a CRO that is suitable to the equity holders in the business entities, the Bankruptcy Court should leave the management of the nondebtor business entities to a court that clearly has jurisdiction to do so, they said. The Barrett Creditors also have requested that the Court deny the appointment of Ms. Byman as CRO of non-debtor entities because: 1. the trustee has conflicts that preclude her from serving as CRO of non-debtor entities that have claims against the Brown Medical Center Estate, the trustee must not be recommending her replacement. 2. The Barrett Creditors and other similarly situated creditors -- persons who have an equity interests in some of the non-debtor entities -- must have a voice in who serves as CRO. Their interests largely have been ignored by the trustee, who represents an Estate that has no equity interest in the non-debtor entities. Previously, the trustee sought to have Ms. Byman replace her as the CRO of non-debtor entities that may have claims against the BMC estate. Certain parties-in-interest have raised concerns over a potential conflict of interest in the trustee concurrently serving as the CRO of entities which may have claims against BMC. About Brown Medical Houston, Texas-based Brown Medical Center, Inc., is a management company that historically served as the epicenter of the operating business enterprise directly or indirectly owned or controlled by Michael Glyn Brown, including six surgery centers and related facilities. The Company sought protection under Chapter 11 of the Bankruptcy Code on Oct. 15, 2013 (Case No. 13-36405, Bankr. S.D.Tex.). The case is assigned to Judge Marvin Isgur. Brown Medical Center is represented by Spencer D. Solomon, Esq., at Nathan Sommers Jacobs, P.C., in Houston, Texas. In November 2013, the Bankruptcy Court approved the appointment of Elizabeth M. Guffy as Chapter 11 trustee. The trustee hired Porter Hedges LLP, led by Joshua W. Wolfshohl, Esq., John F. Higgins, Esq., and James Matthew Vaughn, Esq., Nick D. Nicholas, Esq., J. Patrick LaRue, Esq., and Craig M. Bergez, as counsel. The trustee tapped The Claro Group, LLC, as financial advisor and consultant. In its schedules, Brown Medical listed $13,807,746 in assets and $27,716,168 in liabilities. Brown Medical owes Crown Financial Funding, LP, the primary secured creditor, pursuant to a pre- bankruptcy promissory note in the original principal amount of $2 million, which indebtedness is secured by a security agreement from Allied Center for Special Surgery, Scottsdale, LLC covering accounts and accounts receivable which the Debtor has the right to collect. BROWN MEDICAL: Ch.11 Trustee to Hire More Porter Hedges Staff ------------------------------------------------------------- Elizabeth M. Guffy, the Chapter 11 trustee for Brown Medical Center, Inc., asks the Bankruptcy Court for permission to supplement the order authorizing the employment of Porter Hedges LLP as counsel. The Chapter 11 trustee proposed a hearing on May 14, 2014, at 2:00 p.m. to consider the request. The trustee explained that the supplement will reflect these additional professionals and paraprofessional to assist the trustee. Jonathan Price, a partner in the intellectual property section of PH, and Patricia Gunning, a paralegal in the litigation section of PH. On March 5, the Bankruptcy Court authorized the Chapter 11 trustee to compensate Porter Hedges based on its 2014 hourly rates effective as of Feb. 1, 2014. A copy of the 2014 rates is available for free at: http://bankrupt.com/misc/BROWNMEDICALCENTER_portersupporder.pdf About Brown Medical Houston, Texas-based Brown Medical Center, Inc., is a management company that historically served as the epicenter of the operating business enterprise directly or indirectly owned or controlled by Michael Glyn Brown, including six surgery centers and related facilities. The Company sought protection under Chapter 11 of the Bankruptcy Code on Oct. 15, 2013 (Case No. 13-36405, Bankr. S.D.Tex.). The case is assigned to Judge Marvin Isgur. Brown Medical Center is represented by Spencer D. Solomon, Esq., at Nathan Sommers Jacobs, P.C., in Houston, Texas. In November 2013, the Bankruptcy Court approved the appointment of Elizabeth M. Guffy as Chapter 11 trustee. The trustee hired Porter Hedges LLP, led by Joshua W. Wolfshohl, Esq., John F. Higgins, Esq., and James Matthew Vaughn, Esq., Nick D. Nicholas, Esq., J. Patrick LaRue, Esq., and Craig M. Bergez, as counsel. The trustee tapped The Claro Group, LLC, as financial advisor and consultant. In its schedules, Brown Medical listed $13,807,746 in assets and $27,716,168 in liabilities. Brown Medical owes Crown Financial Funding, LP, the primary secured creditor, pursuant to a pre- bankruptcy promissory note in the original principal amount of $2 million, which indebtedness is secured by a security agreement from Allied Center for Special Surgery, Scottsdale, LLC covering accounts and accounts receivable which the Debtor has the right to collect. BUDD COMPANY: Epiq Approved as Noticing and Claims Agent -------------------------------------------------------- The Bankruptcy Court authorized The Budd Company, Inc., to employ Epiq Bankruptcy Solutions, LLC, as noticing, claims and balloting agent for the court. As reported in the Troubled Company Reporter on April 4, 2014, the Debtor has thousands of creditors, holding claims against the Debtor in excess of $1 billion. Given the size of the Debtor's creditor body, it will be more efficient and less burdensome on the Clerk of the Court to have Epiq undertake the tasks associated with noticing the Debtor's creditors and parties in interest and processing proofs of claim that may be filed. Moreover, the Debtor requires a balloting and voting agent to assist the Debtor with the solicitation and voting in respect of any chapter 11 plan. The terms of Epiq's compensation under the services agreement stem from a competitive process in which the Debtor interviewed and received quotes from multiple potential notice and claims agents. Epiq agreed to a $50,000 retainer. As claims agent, Epiq will charge the Debtors at these rates: Position Hourly Rate -------- ----------- Clerical/Administrative Support $26 to $39 Case Manager $50 to $80 IT/ Programming $70 to $130 Senior Case Manager $85 to $130 Director of Case Management $145 to $195 Case Analyst $65 to $110 Consultant/Senior Consultant $145 to $190 Director/Vice President Consulting $225 Communication Counselor $225 For its noticing services, Epiq will charge $50 per 1,000 e-mails, and $0.10 per page for facsimile noticing. For database maintenance, the firm will charge $0.10 per record per month. For-online claim filing services, Epiq will charge $300 per 100 claims filed. The firm's call center operator will charge $55 per hour. About The Budd Company The Budd Company, Inc., a former supplier to the automotive industry, filed for chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 14-11873) on March 31, 2014, with a deal to settle potential claims against its parent, ThyssenKrupp AG. The company -- which ceased manufacturing operations in 2006 and does not have any current employees, facilities or customers -- has obligations consisting largely of medical and other benefits to approximately 10,000 former employees. Liabilities amount to approximately $1 billion with assets of approximately $400 million. Most of the debt consists largely of medical and other benefits to approximately 10,000 former employees. The Hon. Jack B. Schmetterer oversees the case. The Debtor has tapped Proskauer Rose LLP as Chapter 11 counsel, Dickinson Wright PLLC as special counsel, Epiq Bankruptcy Solutions, LLC as noticing, claims and balloting agent, and Conway MacKenzie Management Services, LLC's Charles M. Moore as CRO. BUDD COMPANY: Files Schedules of Assets and Liabilities ------------------------------------------------------- The Budd Company, Inc., filed with the U.S. Bankruptcy Court for the Northern District of Illinois its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $387,555,681 C. Property Claimed as Exempt D. Creditors Holding Secured Claims Undetermined E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $1,107,350,034 ------------ -------------- TOTAL $387,555,681 $1,107,350,034 Copies of the schedules and notes are available for free at: http://bankrupt.com/misc/BuddCo_56_sals.pdf http://bankrupt.com/misc/BuddCo_72_summarySALs.pdf http://bankrupt.com/misc/BuddCo_73_notesonSALs.pdf About The Budd Company The Budd Company, Inc., a former supplier to the automotive industry, filed for chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 14-11873) on March 31, 2014, with a deal to settle potential claims against its parent, ThyssenKrupp AG. The company -- which ceased manufacturing operations in 2006 and does not have any current employees, facilities or customers -- has obligations consisting largely of medical and other benefits to approximately 10,000 former employees. Liabilities amount to approximately $1 billion with assets of approximately $400 million. Most of the debt consists largely of medical and other benefits to approximately 10,000 former employees. The Hon. Jack B. Schmetterer oversees the case. The Debtor has tapped Proskauer Rose LLP as Chapter 11 counsel, Dickinson Wright PLLC as special counsel, Epiq Bankruptcy Solutions, LLC as noticing, claims and balloting agent, and Conway MacKenzie Management Services, LLC's Charles M. Moore as CRO. BUDD COMPANY: May Pay Expenses of UAW's Advisors ------------------------------------------------ The Bankruptcy Court ordered The Budd Company, Inc., to pay reasonable and necessary expenses of the legal, financial and other advisors of the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America. On April 11, 2014, UAW said the Debtor can seek to modify its Retiree Benefits under Section 1114 of the Bankruptcy Code only after it confers and negotiates in good faith with the authorized representative(s) of both the UAW Retirees and the Non-Union Retirees. The Debtor alleged that it currently provides health care and other benefits to approximately 5,900 of its retired employees or their respective spouses, surviving spouses, domestic partners, and dependents pursuant to certain ERISA-qualified welfare plans. The Debtor estimates that approximately 80% of the Retirees are UAW Retirees and the Debtor alleges that the actuarial value of the Retiree Benefits owed to UAW Retirees was approximately $830.5 million as of the Petition Date. Stanley Eisenstein, Esq., at Katz, Friedman, Eagle, Eisenstein, Johnson & Bareck, P.C., and Lawrence B. Friedman, Esq., at Cleary Gottlieb Steen & Hamilton LLP represent UAW. About The Budd Company The Budd Company, Inc., a former supplier to the automotive industry, filed for chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 14-11873) on March 31, 2014, with a deal to settle potential claims against its parent, ThyssenKrupp AG. The company -- which ceased manufacturing operations in 2006 and does not have any current employees, facilities or customers -- has obligations consisting largely of medical and other benefits to approximately 10,000 former employees. Liabilities amount to approximately $1 billion with assets of approximately $400 million. Most of the debt consists largely of medical and other benefits to approximately 10,000 former employees. The Hon. Jack B. Schmetterer oversees the case. The Debtor has tapped Proskauer Rose LLP as Chapter 11 counsel, Dickinson Wright PLLC as special counsel, Epiq Bankruptcy Solutions, LLC as noticing, claims and balloting agent, and Conway MacKenzie Management Services, LLC's Charles M. Moore as CRO. BUDD COMPANY: U.S. Trustee to Appoint Retirees' Committee --------------------------------------------------------- The Bankruptcy Court has directed the U.S. Trustee to form a Retirees Committee consisting on non-union retirees in the Chapter 11 case of The Budd Company, Inc. As reported in the Troubled Company Reporter on April 3, 2014, the Debtor requested for an order: (1) directing the United States Trustee to appoint a retirees committee to serve as authorized representative for non-union retirees; (2) unless the UAW timely confirms that it is the authorized representative of the UAW retirees, (i) deeming the UAW to have elected not to serve as authorized representative of the UAW retirees, (ii) directing the appointment of UAW retirees to the retirees committee, and (iii) deeming the retirees committee to be the authorized representative of the UAW retirees; and (3) approving retirees committee selection procedures. The Debtor will continue to honor without interruption obligations to its retirees in accordance with Section 1114 of the Bankruptcy Code, and at this time does not expect to modify those obligations prior to the effective date of a chapter 11 plan. The Debtor believes that this is a favorable outcome for retirees, who will continue to receive benefits uninterrupted while a retirees committee (expenses of which Budd expects to pay in accordance with any Court orders) negotiates on their behalf. By commencing the Chapter 11 case now, while it has $384 million in cash, the Debtor hopes to provide retirees and other creditors with significant cash distributions on account of their allowable claims. Among other things, this will allow retirees to use that cash (or any other form of consideration they may receive under a chapter 11 plan) to make informed decisions about their health care and retirement. UAW and Non-Union Retirees The Debtor is categorizing retirees into two groups: (a) former employees, or their respective spouses, surviving spouses, domestic partners, and dependents, who worked in an employment unit covered by a collective bargaining agreement and/or a plant closing agreement between the Debtor and the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America and its Local Unions ("UAW"); and (b) former full-time management and other salaried individuals who did not work in an employment unit covered by a CBA between the Debtor and the UAW, and their respective spouses, surviving spouses, domestic partners, and dependents (the "Non-Union Retirees"). As of the Petition Date: (a) 4,691, or approximately 80%, of the retirees were UAW Retirees; and (b) the actuarial value of the retiree benefits owed to the UAW Retirees was approximately $830.5 million. Pursuant to certain CBAs and national insurance plans, the UAW Retirees receive the following benefits: (a) medical, prescription-drug, dental, vision, and hearing benefits; and (b) life insurance, which constitute welfare benefits under ERISA. The National Agreements, along with each corresponding National Insurance Plan, were negotiated so as to continue in effect for periods ranging from three to five years. Around the expiration of each National Agreement, the terms and conditions of the subsequent National Agreement were re-negotiated. This process continued until 2001, when the Debtor and UAW entered into the last National Agreement, which was given an expiration date of October 28, 2005. All of Budd's CBAs have expired by their own terms. As of the Petition Date: (a) approximately 1,209, or approximately 20%, of the Retirees were Non-Union Retirees; and (b) the actuarial value of the Retiree Benefits owed to Non-Union Retirees was approximately $101.5 million. The Non-Union Retirees life insurance, as well as medical, prescription-drug, dental, vision, and hearing benefits pursuant to benefits plans that constitute welfare plans under ERISA. The Debtor strongly believes that it is in the best interests of the Debtor's estate, the Retirees, and judicial economy that the Debtor engage in discussions regarding modification of Retiree Benefits with authorized representatives of both UAW Retirees and Non-Union Retirees (if not together, then on parallel tracks). Moreover, the Debtor believes there is no reason to delay these discussions, which should begin as soon as practicable, and that there is potential prejudice to Retirees if discussions are significantly delayed. To modify its retiree benefits under Section 1114 of the Bankruptcy Code, the Debtor is required to confer and negotiate in good faith regarding consensual modification of Retiree Benefits with authorized representative(s) of both the UAW Retirees and the Non-Union Retirees. Selection Procedures The Debtor proposes these selection procedures: a. No later than three days after entry of the order granting this Motion, the Debtor will cause a Notice and Questionnaire to appear on: (i) the Chapter 11 case Web site maintained by the Debtor's notice and claims agent; and (ii) the website maintained by the Debtor's benefits administrator. b. No later than three days after entry of the order granting the Motion, the Debtor will mail a Questionnaire to each of: (i) the top 50 Non-Union Retirees (by total defined benefit obligation, "Total DBO"); and (ii) unless the UAW has agreed as of such date to be the authorized representative of the UAW Retirees, the top 15 (or fewer if there are less than 15) UAW Retirees (by Total DBO) from each former plant location of the Debtor. c. No later than five days after entry of the order granting the Motion, the Debtor will file with the Court a certificate of service of mailing of the Questionnaire. d. If the UAW agrees to serve as the authorized representative for the UAW Retirees on or before the 10th day after entry of the order granting the motion, then no UAW Retiree will be eligible for appointment to the Retirees Committee. e. If the UAW, by authorized agent or counsel, does not notify counsel to the Debtor and the U.S. Trustee in writing within 10 days of entry of the order granting the motion that it will be the authorized representative for the UAW Retirees under and for purposes of section 1114 of the Bankruptcy Code, then the UAW will be deemed by the Court to have elected not to serve as authorized representative for the UAW Retirees. f. If the UAW declines, or is deemed by the Court to have declined, to serve as authorized representative for the UAW Retirees, then the U.S. Trustee will appoint one or more UAW Retirees to the Retirees Committee. g. The U.S. Trustee will work promptly to select the Retirees to serve on the Retirees Committee from those Retirees that submit a Questionnaire by the return deadline set forth on the Questionnaire. h. After the Retirees Committee has been formed, the U.S. Trustee will file an appropriate notice with the Court. About The Budd Company The Budd Company, Inc., a former supplier to the automotive industry, filed for chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 14-11873) on March 31, 2014, with a deal to settle potential claims against its parent, ThyssenKrupp AG. The company -- which ceased manufacturing operations in 2006 and does not have any current employees, facilities or customers -- has obligations consisting largely of medical and other benefits to approximately 10,000 former employees. Liabilities amount to approximately $1 billion with assets of approximately $400 million. Most of the debt consists largely of medical and other benefits to approximately 10,000 former employees. The Hon. Jack B. Schmetterer oversees the case. The Debtor has tapped Proskauer Rose LLP as Chapter 11 counsel, Dickinson Wright PLLC as special counsel, Epiq Bankruptcy Solutions, LLC as noticing, claims and balloting agent, and Conway MacKenzie Management Services, LLC's Charles M. Moore as CRO. BUILDING #19: May Amend Schedules and Statements ------------------------------------------------ The U.S. Bankruptcy Court for the District of Massachusetts authorized Building #19, Inc., et al. to amend its Schedule B, Schedule F, Schedule G, and Statement of Financial Affairs. Among other things: 1. Schedule B is amended to include a claim for business interruption at the Cranston, Rhode Island Store in response to question 21 -- other contingent and unliquidated claims of every nature; 2. Schedule F is amended to remove the following unsecured nonpriority claims: to amend its Schedule B, Schedule F, Schedule G, and Statement of Financial Affairs; 3. Schedule F has also been amended by reducing the claim of KOTAP America, Ltd., 10 Bayview Ave., Lawrence, NY 11559 from the amount of $4,489,788. About Building #19, Inc. Building #19, Inc., and its affiliates sought protection under Chapter 11 of the Bankruptcy Code on Nov. 1, 2013 (Bankr. D. Mass. Case No. 13-16429). The other debtors are (a) Paperworks #19, Inc., Case No. 13-16430; (b) Beth's Basics, Inc., Case No. 13-16433; (c) Furniture #19, Inc., Case No. 13-16431; (d) PB&J Kids #19, Inc., Case No. 13-16434; and (e) Footwear #19 Plus, Inc. Case No. 13-16432. Donald Ethan Jeffery, Esq., and Harold B. Murphy, Esq., at Murphy & King, Professional Corporation, in Boston, Massachusetts, serve as the Debtors' bankruptcy counsel. The Tron Group, LLC, serve as their financial advisers. The U.S. Trustee for Region 1 appointed five members to the official committee of unsecured creditors. The Committee retained Duane Morris LLP as its counsel. Newburg & Company LLP is the financial advisors to the Committee. BUILDING #19: Seeks to Auction Off Remaining Inventory ------------------------------------------------------ Building #19, Inc., et al., ask the U.S. Bankruptcy Court for the District of Massachusetts for authorization to sell their remaining inventory by private sale to Alex Lyon & Son Sales Manager & Auctioneers, Inc., and abandon certain personal property. The Debtors intend to sell any trailer, furniture, fixtures and equipment for $20,000, subject to bigger and better offers. The Court is yet to schedule the auction. Competing bids are due May 1, 2014, at 4:30 p.m. The Court will consider approval of the sale at a hearing May 14, at 10:30 a.m. Objections, if any, are due May 1 at 4:30 p.m. About Building #19, Inc. Building #19, Inc., and its affiliates sought protection under Chapter 11 of the Bankruptcy Code on Nov. 1, 2013 (Bankr. D. Mass. Case No. 13-16429). The other debtors are (a) Paperworks #19, Inc., Case No. 13-16430; (b) Beth's Basics, Inc., Case No. 13-16433; (c) Furniture #19, Inc., Case No. 13-16431; (d) PB&J Kids #19, Inc., Case No. 13-16434; and (e) Footwear #19 Plus, Inc. Case No. 13-16432. Donald Ethan Jeffery, Esq., and Harold B. Murphy, Esq., at Murphy & King, Professional Corporation, in Boston, Massachusetts, serve as the Debtors' bankruptcy counsel. The Tron Group, LLC, serve as their financial advisers. The U.S. Trustee for Region 1 appointed five members to the official committee of unsecured creditors. The Committee retained Duane Morris LLP as its counsel. Newburg & Company LLP is the financial advisors to the Committee. C&K Market: Hires Cushman & Wakefield as Appraiser -------------------------------------------------- C & K Market, Inc. seeks authorization from the U.S. Bankruptcy Court for the District of Oregon to employ Cushman & Wakefield OR, Inc. as appraiser. The Debtor requires Cushman & Wakefield to provide: (a) property inspection to the extent necessary to adequately identify the real estate; (b) research relevant market data, in terms of quantity, quality, and geographic comparability, to the extent necessary to produce credible appraisal results; (c) consider and develop those approaches relevant and applicable to the appraisal problem; (d) income capitalization approach; and (e) sales comparison approach. The Debtor proposes to pay Cushman & Wakefield a fee of $16,000 plus expenses upon delivery of a final appraisal report, without the need for a fee application and without further order of the Court. Cushman & Wakefield will also be reimbursed for reasonable out-of- pocket expenses incurred. Jay F. Booth, senior managing director of Cushman & Wakefield, 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. Cushman & Wakefield can be reached at: Jay F. Booth CUSHMAN & WAKEFIELD OR, INC. 200 S.W. Market Street, Suite 200 Portland, OR 97201 Tel: (503) 279-1709 Fax: (503) 279-1791 E-mail: jay.booth@cushwake.com About C&K Market C&K Market Inc., a 57 year-old grocery store chain, sought bankruptcy protection from creditors with a plan to sell or close some of its stores, on Nov. 19, 2013 (Bankr. D. Ore. Case No. 13-64561). The case is assigned to Judge Frank R. Alley, III. C&K Market scheduled $157,696,921 in total assets and $101,604,234 in total liabilities. The Debtor is represented by Albert N. Kennedy, Esq., Timothy J. Conway, Esq., Michael W. Fletcher, Esq., and Ava L. Schoen, Esq., at Tonkon Torp LLP, in Portland, Oregon. Edward Hostmann has been tapped as chief restructuring officer, and The Food Partners, LLC, serves as the Debtor's financial advisor. Kieckhafer Schiffer & Company LLP serves as advisors and consultants to communicate with lenders, brokers, attorneys and other professionals. Henderson Bennington Moshofsky, P.C., serves as accountants. Watkinson Laird Rubenstein Baldwin & Burgess PC serves as labor counsel. The Debtor hired Great American Group, LLC, to conduct store closing sales. Kurtzman Carson Consultants is the Debtor's noticing agent. An Official Committee of Unsecured Creditors appointed in the Debtor's case has retained Scott L. Hazan, Esq., David M. Posner, Esq., and Jenette A. Barrow-Bosshart, Esq., at Otterbourg P.C. as lead co-counsel, and Tara J. Schleicher, Esq., at Farleigh Wada Witt as local co-counsel; and Protiviti, Inc. as financial consultant. CAESARS ENTERTAINMENT: Closes Offering of $675MM Senior Notes ------------------------------------------------------------- Caesars Growth Properties Holdings, LLC, and Caesars Growth Properties Finance, Inc., completed the offering of $675 million aggregate principal amount of their 9.375 percent second-priority senior secured notes due 2022. The Issuers are subsidiaries of Caesars Growth Partners, LLC, which is a joint venture between Caesars Acquisition Company and Caesars Entertainment Corporation. Pursuant to an escrow agreement, dated as of April 17, 2014, among U.S. Bank National Association, as escrow agent and securities intermediary, U.S. Bank National Association, as trustee, under the Indenture, and the Issuers, the Issuers deposited the gross proceeds of the offering of the Notes, together with additional amounts necessary to redeem the Notes, if applicable, into a segregated escrow account until the date that certain escrow conditions are satisfied. The escrow conditions include, among other things, the consummation of the previously announced acquisition of the subsidiaries of Caesars Entertainment Operating Company, Inc., that own the assets comprising The Cromwell (f/k/a Bill's Gamblin' Hall & Saloon), The Quad Resort & Casino, Bally's Las Vegas and Harrah's New Orleans and the contribution by Caesars Growth Partners of the entity that owns the assets comprising the Planet Hollywood Resort & Casino and the receipt of all required regulatory approvals. The funds held in the Escrow Account will be released to the Issuers upon delivery by the Issuers to the Escrow Agent and the Trustee of an officer's certificate certifying that, prior to or concurrently with the release of funds from the Escrow Account, the escrow conditions have been met. The Issuers granted the Trustee, for the benefit of the holders of the Notes, a first-priority security interest in the Escrow Account and all deposits therein to secure the note obligations pending disbursement. The Notes, which mature on May 1, 2022, were issued pursuant to an indenture dated as of April 17, 2014, among the Issuers and U.S. Bank National Association, as trustee. The Issuers will pay interest on the Notes at 9.375 percent per annum, semi-annually to holders of record at the close of business on April 15 or October 15 immediately preceding the interest payment date on May 1 and November 1 of each year, commencing on Nov. 1, 2014. The Issuers may redeem the Notes at their option, in whole or part, at any time prior to May 1, 2017, at a price equal to 100 percent of the principal amount of the Notes redeemed plus accrued and unpaid interest to the redemption date and a "make-whole" premium. The Issuers may redeem the Notes, in whole or in part, on or after May 1, 2017, at the redemption prices set forth in the Indenture and the Notes. In addition, at any time and from time to time on or before May 1, 2017, the Issuers may choose to redeem in the aggregate up to 35 percent of the original aggregate principal amount of the Notes at a redemption price equal to 109.375 percent of the principal amount thereof with the net proceeds of one or more equity offerings so long as at least 50 percent of the original aggregate principal amount of the Notes remain outstanding after each such redemption. The Issuers intend to use the net proceeds from the offering of the Notes, on the Escrow Release Date, together with borrowings under new Senior Secured Credit Facilities and cash contributed to them by Caesars Growth Partners, to complete the Transactions and related transactions, including the repayment in full of all amounts then outstanding under the senior secured term loan of PHWLV, LLC, and to pay related fees and expenses. On April 17, 2014, in connection with the issuance of the Notes, the Issuers entered into a registration rights agreement with Citigroup Global Markets Inc., as representative of the initial purchasers of the Notes, relating to, among other things, the exchange offer for the Notes and the related subsidiary guarantees. Upon the Escrow Release Date, the subsidiary guarantors will execute a joinder to the Registration Rights Agreement. Additional information about the transactions is available for free at http://is.gd/mmNHiq About Caesars Entertainment Las Vegas-based Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies. Harrah's announced its re- branding to Caesar's in mid-November 2010. Caesars Resorts Properties, LLC is a subsidiary of Caesars Entertainment Corporation that owns 6 casinos properties and Project Linq. Caesars Entertainment Operating Company is a subsidiary of CEC and sister subsidiary to CERP. As of Dec. 31, 2013, the Company had $24.68 billion in total assets, $26.59 billion in total liabilities and a $1.90 billion total deficit. * * * In April 2014, Standard & Poor's Ratings Services lowered its corporate credit ratings on Caesars Entertainment Corp. (CEC) and wholly owned subsidiaries, Caesars Entertainment Operating Co. (CEOC) and Caesars Entertainment Resort Properties (CERP), as well as the indirectly majority-owned Chester Downs and Marina, to 'CCC-' from 'CCC+'. The downgrade reflects S&P's expectation that Caesars' capital structure is unsustainable, and the amount of cash the company will burn in 2014 and 2015 creates conditions under which S&P believes a restructuring of some form is increasingly likely over the near term absent an unanticipated significantly favorable change in operating performance. S&P expects Caesars to use substantial cash to meet interest expense, capital expenditures, and debt maturities over the next year and forecast that the company will burn more than $1.2 billion in cash in 2014 to meet approximately $3 billion in fixed charges. S&P do not expect that Caesars will have sufficient liquidity in 2015 to meet its estimate of fixed charges, absent additional asset sales or access to the capital markets. S&P estimates fixed charges, including interest, capital expenditures, and debt maturities, will approximate $3.5 billion in 2015. In March 2014, Moody's downgraded CEOC's Corporate Family rating to Caa3 and Probability of Default rating to PD-Caa3; and affirmed CERP's B3 CFR and B3-PD, first lien term loan at B2, and second lien notes at Caa2. The downgrade reflects Moody's concern that the loss of EBITDA from the proposed sale of four casinos to Caesars Growth Partners Holdings ("CGPH") will cause CEOC's already high leverage to increase as well as reduce bondholders' recovery prospects. Despite the approximate $1.8 billion of cash that will be received by CEOC and may be used to repay a small amount of debt and fund operating losses for a period of time, in Moody's opinion, the proposed sale significantly heightens CEOC's probability of default along with the probability that the company will pursue a distressed exchange or a bankruptcy filing. CGPH is a wholly owned indirect subsidiary of Caesars Growth Partners, LLC ("CGP"). CGP is owned and controlled by Caesars Acquisition Company which is owned by CEC and affiliates of private equity firms Apollo and TGP. CD STORES: Carol's Daughter Files for Chapter 11, to Close Stores ----------------------------------------------------------------- Entities affiliated with beauty products company Carol's Daughter filed for Chapter 11 bankruptcy protection April 24 in U.S. Bankruptcy Court for the Southern District of New York in Manhattan. The filing entities are CD Stores LLC and its retail affiliates: CD Store 125th, LLC; CD Store Atlantic Terminal, LLC; CD Store Roosevelt Field, LLC; CD Store Pentagon City LLC; CD Store Newport Centre, LLC; CD Store Fox Hills, LLC; and CD Store Lenox Square, LLC. The Debtors' primary business is the marketing and sales of natural hair, body, and skincare beauty products under the name "Carol's Daughter," from retail stores located in New York, New Jersey, Georgia, Virginia, and California. Carol's Daughter has been known for its natural beauty products for more than 20 years. Debtor CD Stores does not operate a retail location, and has no employees, but it is the sole member of the Retail Debtors, and guarantor with respect to certain lease agreements for Debtor 125th, Debtor Roosevelt Field, Debtor Lenox, Debtor Newport, Debtor Fox, and Debtor Pentagon. Debtor CD Stores is wholly owned by Carol's Daughter Holdings, LLC, a New York limited liability company. CD Holdings is the sole member of Debtor CD Stores, and Carol's Daughter Products, LLC, a Delaware limited liability company. Neither CD Holdings nor CD Products have sought bankruptcy protection. CD Holdings and CD Products focus on the marketing and sales of Carol's Daughter beauty products direct to consumers, through CarolsDaughter.com, a website owned and operated by Carol's Daughter Online, LLC1, as well as to wholesale vendors. The Debtors are not involved in the online marketing and sales of Carol's Daughter beauty products. In 2004, the Carol's Daughter enterprise was founded by Lisa Price in Brooklyn, New York. As of the Petition Date, Lisa Price is the President of each of the Debtors, but does not hold an equity interest in any of the Debtors CD Stores estimated assets and debts each in the $1 million to $10 million range. Continuing Losses John D. Elmer, the Chief Financial Officer and Chief Operating Officer of CD Stores, said for the last several years, each of the Retail Debtors, except Debtor Atlantic, operated at a loss, which loss was funded by the Debtors' non-debtor affiliates. Although Debtor 125th operated at a loss, it not only markets the Debtors' products, but it also contains a salon for the Debtors' consumers. In 2013, the Debtors had aggregate losses of $1,173,611.00 on revenues of $3,146,511. As of the Petition Date, the Debtors have aggregate losses of $476,531. For the calendar year ending Dec. 31, 2014, the Debtors project that they will have losses from sales in the amount of $403,281 on revenues of $1,528,000, which amounts include estimated costs and expenses to be incurred in connection with the Debtors' chapter 11 cases. In 2013, Debtor Atlantic had profits of $167,000 on revenues of $587,000.00, and it is projected that Debtor Atlantic will have profits of $91,000 on revenues of $466,000 in 2014. As of April 20, 2014, the Debtors, on an unaudited basis, had total assets with a book value of approximately $280,435 and total liabilities of roughly $7,050,016. Other than the large amount due to Debtor CD Stores, the Retail Debtors remaining claims are for lease obligations. As of the Petition Date, the aggregate amount due to CD Products is $6,822,565. That debt is unsecured, and is shown as a liability on Debtor CD Stores' books and records. Each of the Debtors maintain separate books and records. Each Retail Debtor has an amount due to or due from Debtor CD Stores. Restructuring Strategy According to Mr. Elmer, the Debtors seek to restructure Debtor Atlantic and Debtor 125th's operations so that they can fund a chapter 11 plan and emerge from chapter 11 as profitable operating retail stores. The Debtors' management have determined it was in the best interests of the Debtors and their creditors to transition their business model from selling beauty products in retail stores across the country, to marketing the Debtors' products through fewer retail locations. Prior to the Petition Date, management determined that it was appropriate to close the retail stores of certain Retail Debtors, vacate and surrender the premises to the applicable landlords, and seek to consolidate their retail sales efforts around the stores operated by Debtor 125th and Debtor Atlantic. After the Petition Date, the Debtors intend to continue to operate, except that after revenue from sales earned by Debtor 125th and Debtor Atlantic will be held by Debtor CD Stores and used to fund operations pending confirmation of a chapter 11 plan, for those collective entities. Mr. Elmer said the Debtors have reduced their expenses by ceasing business operations in all but two locations: (i) Debtor Atlantic in Brooklyn, New York; and (ii) Debtor 125th in Harlem, New York. As part of that restructuring, the number of the Debtors' total aggregate employees has been reduced from 42 to 13. In addition, Debtor Roosevelt, Debtor Lenox, Debtor Pentagon, Debtor Newport, and Debtor Fox, each vacated their retail store locations, surrendered the premises to their landlords, and transferred any remaining inventory, which was of nominal value, to Debtor Atlantic and Debtor 125th. The Debtors believe that under the Chapter 11 protection, they will be able to restructure their businesses and propose a confirmable chapter 11 plan which will provide greater value to creditors compared to the liquidation of the Debtors' assets. "First Day" Motions On the Petition Date, the Debtors filed these "First Day" motions seeking emergency relief: -- Motion for Order Directing Joint Administration of their Cases Pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure. -- Motion to Continue to Use Existing Bank Accounts and Cash Management System Mr. Elmer said the motion seeking authorization to continue to use the Debtors' pre-Petition Date bank accounts and checks, as well as its cash management system used to process orders, will save the Debtors, and their professionals, valuable time in making the transition to operating under chapter 11. It will also spare the Debtors the delay in transferring funds between Debtor CD Stores, and the two remaining operating Debtors, Debtor Atlantic and Debtor 125th. In addition, after the Petition Date, the Debtors intend to continue their cash management system, except that revenue from sales earned by Debtor 125th and Debtor Atlantic will be held by Debtor CD Stores to be used to fund operations pending confirmation of a chapter 11 plan. The Debtors' bank accounts are located at Wells Fargo Bank, N.A. which is an approved bank under the Guidelines for Region 2 of the United States Trustee's Office. Employee wages, salaries, and commissions, as well as rental obligations, and expenses for inventory with respect to business operations for Debtor Atlantic and Debtor 125th, will be paid by Debtor CD Stores to the various third-parties vendors, with appropriate accounting entries made. Debtor Atlantic and Debtor 125th will continue to upstream revenue to Debtor CD Stores, to offset such advances, with any excess funds to be used for the Debtors' chapter 11 plan. CD STORES: Voluntary Chapter 11 Case Summary -------------------------------------------- CD Store entities that filed Chapter 11 bankruptcy petitions: Debtor Case No. ------ -------- CD Stores, LLC 14-11192 fka Carol's Daughter Stores, LLC 99 Hudson Street, 6th Floor New York, NY 10013 CD Store 125th, LLC 14-11195 CD Store Atlantic Terminal, LLC 14-11198 CD Store Roosevelt Field, LLC 14-11199 CD Store Pentagon City LLC 14-11200 CD Store Newport Centre, LLC 14-11202 CD Store Fox Hills, LLC 14-11204 CD Store Lenox Square, LLC 14-11205 Type of Business: Maker of hair, body and skincare products with natural ingredients, with a special focus on products for African-American women. Chapter 11 Petition Date: April 24, 2014 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Hon. Shelley C. Chapman Debtor's Counsel: Gerard R. Luckman, Esq. SILVERMANACAMPORA, LLP 100 Jericho Quadrangle, Suite 300 Jericho, NY 11753 Tel: (516) 479-6300 Fax: (516) 479-6301 Email: filings@spallp.com - and - Adam L. Rosen, Esq. SILVERMAN ACAMPORA LLP 100 Jericho Quadrangle, Suite 300 Jericho, NY 11753 Tel: (516) 479-6300 Fax: (516) 479-6301 Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million The petitions were signed by John D. Elmer, chief financial officer, chief operating officer. The Debtors did not file a list of their largest unsecured creditors when they filed the petitions. CLEAN DIESEL: BDO USA Raises Going Concern Doubt ------------------------------------------------ Clean Diesel Technologies, Inc., had a net loss of $7.1 million on $55.28 million of revenue in 2013, compared with a net loss of $9.66 million on $60.54 million of revenue in 2012, according to a filing with the U.S. Securities and Exchange Commission. BDO USA, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company suffered recurring losses and negative cash flows from operations since inception, resulting in an accumulated deficit of $181.7 million as of Dec. 31, 2013. The Company's balance sheet at Dec. 31, 2013, showed $28.37 million in total assets, $22.92 million in total liabilities, and stockholders' equity of $5.45 million. A copy of the Form 10-K is available at: http://is.gd/yewz1F Ventura, Calif.-based Clean Diesel Technologies, Inc. (NASDAQ: CDTI) -- http://www.cdti.com/-- is a global manufacturer and distributor of heavy duty diesels and light duty vehicle emissions control systems and products to automakers and retrofitters. The Company operates in two segments: Heavy Duty Diesel Systems division and Catalyst division. The Company's Heavy Duty Diesel Systems division specializes in the design and manufacture of verified exhaust emissions control solutions. Its Catalyst division produces catalyst formulations to reduce emissions from gasoline, diesel and natural gas combustion engines. COATES INTERNATIONAL: Narrows Net Loss to $2.75-Mil. in 2013 ------------------------------------------------------------ Coates International, Ltd., had a net loss of $2.75 million on $19,200 of revenue in 2013, compared with a net loss of $4.53 million on $19,200 of revenue in 2012, according to a filing with the U.S. Securities and Exchange Commission. The Company had a net loss of $2.99 million on $125,000 of sales for the year ended Dec. 31, 2011. Cowan, Gunteski & Co., P.A., expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company continues to have negative cash flows from operations, recurring losses from operations, and a stockholders' deficiency. Cowan Gunteski also issued a going-concern qualification last year, also noting of the recurring losses and negative cash flows from operations. The Company's balance sheet at Dec. 31, 2013, showed $2.4 million in total assets, $5.64 million in total liabilities, and stockholders' deficit of $3.24 million. A copy of the Form 10-K is available at: http://is.gd/TLiH1p About Coates International Based in Wall Township, N.J., Coates International, Ltd. (OTC BB: COTE) -- http://www.coatesengine.com/-- was incorporated on August 31, 1988, for the purpose of researching, patenting and manufacturing technology associated with a spherical rotary valve system for internal combustion engines. This technology was developed over a period of 15 years by Mr. George J. Coates, who is the President and Chairman of the Board of the Company. The Coates Spherical Rotary Valve System (CSRV) represents a revolutionary departure from the conventional poppet valve. It changes the means of delivering the air and fuel mixture to the firing chamber of an internal combustion engine and of expelling the exhaust produced when the mixture ignites. COMMUNICATION INTELLIGENCE: Had $8.1-Mil. Net Loss in 2013 ---------------------------------------------------------- Communication Intelligence Corporation had a net loss of $8.1 million on $1.42 million of revenues in 2013, compared with a net loss of $6.75 million on $2.38 million of revenues in 2012, according to the company's Form 10-K filed with the U.S. Securities and Exchange Commission. The company had a net loss attributable to common stockholders of $6.66 million in 2011. PMB Helin Donovan, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has significant recurring losses and accumulated deficit. The Company's balance sheet at Dec. 31, 2013, showed $2.75 million in total assets, $1.55 million in total liabilities, and stockholders' equity of $1.2 million. A copy of the Form 10-K is available at: http://is.gd/vwPVxA About Communication Intelligence Redwood Shores, California-based Communication Intelligence Corporation is a supplier of electronic signature products and the recognized leader in biometric signature verification. COMPETITIVE TECHNOLOGIES: Reports $2.67 Million 2013 Net Loss ------------------------------------------------------------- Competitive Technologies, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $2.67 million on $653,000 of product sales for the year ended Dec. 31, 2013, as compared with a net loss of $3 million on $913,000 of product sales for the year ended Dec. 31, 2012. As of Dec. 31, 2013, the Company had $4.56 million in total assets, $10.5 million in total liabilities, all current, and a $5.94 million total shareholders' deficit. Mayer Hoffman McCann CPAs, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred operating losses since fiscal year 2006 and has a working capital deficiency at Dec. 31, 2013. These conditions 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/veHj3U About Competitive Technologies Fairfield, Conn.-based Competitive Technologies, Inc. (OTC QX: CTTC) -- http://www.competitivetech.net/-- was established in 1968. The Company provides distribution, patent and technology transfer, sales and licensing services focused on the needs of its customers and matching those requirements with commercially viable product or technology solutions. Sales of the Company's Calmare(R) pain therapy medical device continue to be the major source of revenue for the Company. COPYTELE INC: Amends 2013 Form 10-K to Add Disclosure ----------------------------------------------------- CopyTele, Inc., amended its annual report on Form 10-K for the fiscal year ended Oct. 31, 2013, which was originally filed with the U.S. Securities and Exchange Commission on Jan. 16, 2014, and amended on Jan. 17, 2014, in order to include certain additional disclosure relating to the Company's patent portfolios. A copy of the Form 10-K/A is available for free at http://is.gd/ptyOkT About CopyTele Melville, N.Y.-based CopyTele, Inc.'s principal operations include the development, production and marketing of thin flat display technologies, including low-voltage phosphor color displays and low-power passive E-Paper(R) displays, and the development, production and marketing of multi-functional encryption products that provide information security for domestic and international users over several communications media. CopyTele incurred a net loss of $10.08 million for the year ended Oct. 31, 2013, as compared with a net loss of $4.25 million during the prior year. As of Jan. 31, 2014, the Company had $10.32 million in total assets, $11.54 million in total liabilities, all current, $4.44 million in contingencies and a $5.66 million total shareholders'deficiency. ELWOOD ENERGY: S&P Affirms 'BB-' Rating on $402MM Secured Bonds --------------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'BB-' ratings on Elwood Energy LLC's $402 million 8.159% amortizing senior secured bonds due 2026. At the same time, S&P revised the outlook to stable from negative. The '1' recovery rating on the bonds is unchanged. The rating on Elwood Energy's $402 million ($167.5 million outstanding as of the end of January 2014) 8.159% amortizing senior secured bonds due 2026 is 'BB-', reflecting S&P's expectation of volatile cash flows resulting from increasing exposure to merchant power markets, offset to an extent by strong operational performance and potentially higher utilization of Elwood's generating units due to prevailing low natural gas prices. "The key business risk is Elwood's increased exposure to the power and capacity markets as Elwood's power supply agreements expire," said Standard & Poor's credit analyst Richard Cortright. Fifty-six percent of Elwood's generating capacity is currently exposed to these markets, and the company's debt does not fully amortize until 2026. The risk comes largely from the volatility of capacity prices as demonstrated in the last several PJM Interconnection capacity auctions ($16.46 per megawatt per day (MW-day) in the 2009 auction; $27.73/MW-day in 2010; $125.99/MW- day in 2011; $136/MW-day in 2012; and $59/MW-day in 2013). The stable outlook reflects the project's debt service coverage that Standard & Poor's forecasts to remain above 1.75x over the next several years, including during the project's partial and completely merchant period, which began in 2013. S&P believes that Elwood will have sufficient liquidity to support debt service obligations, which S&P do not anticipate the facility will need. The coverages are dependent on merchant revenues as the expiration of one of the power purchase agreements (PPA) has left only about 44% of the capacity contracted. EMISPHERE TECHNOLOGIES: McGladrey Raises Going Concern Doubt ------------------------------------------------------------ Emisphere Technologies, Inc., had a net loss of $20.9 million on $nil of revenues in 2013, compared with a net loss of $1.93 million on $nil of revenues in 2012, according to the Company's latest Form 10-K filed with the U.S. Securities and Exchange Commission. McGladrey LLP expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has suffered recurring losses from operations, has a working capital deficiency and a significant stockholders' deficit, and has limited cash availability. The Company's balance sheet at Dec. 31, 2013, showed $4.98 million in total assets, $91.8 million in total liabilities, and a stockholders' deficit of $86.8 million. A copy of the Form 10-K is available at: http://is.gd/uInnyJ Roseland, N.J.-based Emisphere Technologies, Inc. (OTC BB: EMIS) is a biopharmaceutical company that focuses on a unique and improved delivery of therapeutic molecules and commercialization of its own product candidates using its Eligen(R) Technology. These molecules could be currently available or are under development. ERA GROUP: S&P Lowers Unsecured Debt Rating to 'B-' --------------------------------------------------- Standard & Poor's Ratings Services said it lowered its rating on Era Group Inc.'s unsecured debt to 'B-' from 'B' and revised its recovery rating on this debt to '5' from '4'. The '5' recovery rating reflects S&P's expectation of modest (10% to 30%) recovery in the event of a payment default. The 'B' corporate credit rating remains unchanged. The outlook is stable. The revised recovery and issue-level ratings on Era's unsecured notes reflect the company's amended and restated credit facility, which increases the size of its revolving credit facility to $300 million, from $200 million. Because S&P's recovery analysis assumes that the revolving credit facility will be fully drawn before default, the larger facility reduces the collateral available to the $200 million of unsecured debt under S&P's default scenario. The stable outlook reflects Standard & Poor's view that S&P is unlikely either to raise or lower its corporate credit rating on Era Group Inc. within the next 12 months. S&P expects credit quality to remain stable due to the mostly fixed payment nature of its contracts, its focus on less volatile production activities, and its stable customer base. S&P could lower the rating if it expects that Era's FFO to debt is likely to be below 12% with no path to improvement. S&P could also lower the rating if volatility of profitability increases, which it could foresee if contract payment becomes more reliant on flight hours or if the company has difficulty contracting its newbuilds or existing vessels coming off contract. An upgrade will depend on Era's ability to expand its helicopter fleet while increasing its weighting to higher margin medium and heavy aircraft. An upgrade will also require run rate FFO to debt higher than 20%. FIRST SECURITY: To Issue 6.2 Million Common Shares Under Plan ------------------------------------------------------------- First Security Group, Inc., registered with the U.S. Securities and Exchange Commission 6,250,000 shares of the Company's common stock issuable under the 2012 Long-Term Incentive Plan for a proposed maximum aggregate offering price of $12,093,750. A copy of the Form S-8 prospectus is available at http://is.gd/krBtsx About First Security Group First Security Group, Inc., is a bank holding company headquartered in Chattanooga, Tennessee. Founded in 1999, First Security's community bank subsidiary, FSGBank, N.A. has 28 full- service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning, internet banking http://www.FSGBank.com/ First Security incurred a net loss of $13.44 million in 2013, a net loss of $37.57 million in 2012 and a net loss of $23.06 million in 2011. As of Dec. 31, 2013, the Company had $977.57 million in total assets, $893.92 million in total liabilities, and shareholders' equity of $83.64 million. FOUR OAKS: Inks Securities Purchase Agreement with Kenneth Lehman ----------------------------------------------------------------- Four Oaks Fincorp, Inc., the holding company for Four Oaks Bank & Trust Company, has entered into a securities purchase agreement with Kenneth R. Lehman, a private investor. Pursuant to the Securities Purchase Agreement, Mr. Lehman has agreed to purchase from the Company, for $1.00 per share, the lesser of: (i) 10,000,000 shares of common stock, $1.00 par value per share; (ii) if the Rights Offering is completed, all shares of Common Stock not purchased by shareholders exercising their basic subscription privilege; and (iii) the maximum number of shares that he may purchase without causing an "ownership change" under Section 382(g) of the Internal Revenue Code of 1986, as amended (based on all shares of Common Stock outstanding at the completion of the Rights Offering and the Standby Offering). In addition, the Securities Purchase Agreement provides Mr. Lehman a right of first refusal to purchase an additional 6,000,000 shares subject to the limitations outlined in clauses (ii) and (iii) above. The Securities Purchase Agreement contemplates an initial closing of the sale of 875,000 shares of Common Stock to Mr. Lehman and a subsequent closing of the remaining number of shares. The Securities Purchase Agreement permits the Company to conduct a rights offering, which will impact the number of shares Mr. Lehman may purchase. Mr. Lehman may participate in the Rights Offering with respect to the 875,000 shares of Common Stock he is expected to hold on the record date of the Rights Offering. The number of shares Mr. Lehman is committed to purchase in the Standby Offering will be reduced by the number of shares he purchases in the Rights Offering. The Company has agreed that, if for any reason it does not complete the Rights Offering, Mr. Lehman will still be permitted to purchase shares of Common Stock. "This capital investment is a major development for Four Oaks Bank & Trust. We expect this infusion of capital to be extremely positive for our bank, our customers, and the communities we serve," said Ayden R. Lee, Jr., chairman, president, and chief executive officer of the Company and the Bank. "Our mission is to be a community-based bank, working directly with our customers, understanding their needs and their businesses and making sure we are building a stronger economy for everyone. There is little doubt that we have been through a number of tumultuous years, but the Bank has weathered the recession and we believe we are now positioned to turn the corner. This capital investment will help strengthen the Bank and our resolve to return to our core mission of being a premier community bank in North Carolina," Mr. Lee concluded. Sandler O'Neill & Partners, L.P., acted as financial advisor to the Company. With $811.6 million in total assets as of Sept. 30, 2013, the Company, through its wholly-owned subsidiary, the Bank, offers a broad range of financial services through its thirteen branches in Four Oaks, Clayton, Smithfield, Garner, Benson, Fuquay-Varina, Wallace, Holly Springs, Harrells, Zebulon, Dunn, and Raleigh, and a loan production office in Southern Pines, North Carolina. Four Oaks Fincorp, Inc., trades through its market makers under the symbol of FOFN. Rights Offering Four Oaks intends to conduct a rights offering of up to approximately $26.6 million. In the Rights Offering, the Company will distribute, at no charge, non-transferable subscription rights to its shareholders as of a future record date. For each share of common stock, $1.00 par value per share, held as of the record date, a shareholder will receive a non-transferable right to purchase three shares of Common Stock at a subscription price of $1.00 per share. Shareholders who exercise their Basic Subscription Privilege in full will have the opportunity to subscribe for additional shares in the event that not all available shares are purchased pursuant to the Basic Subscription Privilege or by Kenneth R. Lehman pursuant to the Securities Purchase Agreement, dated March 24, 2014, subject to certain limitations. Subject to review of the registration statement to be filed with the Securities and Exchange Commission, the Company intends to commence the Rights Offering during the second quarter of 2014. About Four Oaks Based in Four Oaks, North Carolina, Four Oaks Fincorp, Inc., is the bank holding company for Four Oaks Bank & Trust Company. The Company has no significant assets other than cash, the capital stock of the bank and its membership interest in Four Oaks Mortgage Services, L.L.C., as well as $1,241,000 in securities available for sale as of Dec. 31, 2011. Four Oaks disclosed a net loss of $6.96 million in 2012 following a net loss of $9.09 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $811.56 million in total assets, $789.31 million in total liabilities and $22.24 million in total shareholders' equity. "The Company and the Bank entered into a formal written agreement (the "Written Agreement") with the Federal Reserve Bank of Richmond ("FRB") and the North Carolina Office of the Commissioner of Banks ("NCCOB") that imposes certain restrictions on the Company and the Bank, as described in Notes H - Trust Preferred Securities and Note K - Regulatory Restrictions. A material failure to comply with the Written Agreement's terms could subject the Company to additional regulatory actions and further restrictions on its business, which may have a material adverse effect on the Company's future results of operations and financial condition. "In order for the Company and the Bank to maintain its well capitalized position under federal banking agencies' guidelines, management believes that the Company may need to raise additional capital to absorb the potential future credit losses associated with the disposition of its nonperforming assets. Management is in the process of evaluating various alternatives to increase tangible common equity and regulatory capital through the issuance of additional equity. The Company is also working to reduce its balance sheet to improve capital ratios and is actively evaluating a number of capital sources, asset reductions and other balance sheet management strategies to ensure that the projected level of regulatory capital can support its balance sheet long-term. There can be no assurance as to whether these efforts will be successful, either on a short-term or long-term basis. Should these efforts be unsuccessful, the Company may be unable to discharge its liabilities in the normal course of business. There can be no assurance that the Company will be successful in any efforts to raise additional capital during 2013," according to the Company's annual report for the period ended Dec. 31, 2012. FREDERICK'S OF HOLLYWOOD: Merger Closing Date Extended to June 15 ----------------------------------------------------------------- Frederick's of Hollywood Group Inc. entered into an amendment no. 1 to the Agreement and Plan of Merger, dated as of Dec. 18, 2013, by and among FOHG Holdings, LLC ("Parent"), FOHG Acquisition Corp. ("Merger Sub") and the Company. The Amendment extends the termination date under the Merger Agreement from April 30, 2014, to June 15, 2014. The Merger Agreement was entered into by and among the Company, Parent, and Merger Sub. If the conditions to the closing of the merger are either satisfied or waived, Merger Sub will be merged with and into the Company, the separate corporate existence of Merger Sub will cease and the Company will continue its corporate existence under New York law as the surviving corporation in the merger and a wholly owned subsidiary of Parent. Upon completion of the Merger, the Common Stock, other than Excluded Shares and Dissenting Shares, will be converted into the right to receive $0.27 per share in cash, without interest and less any required withholding taxes. Following the completion of the Merger, the Common Stock will no longer be publicly traded, and holders of the Common Stock that has been converted will cease to have any ownership interest in the Company. Frederick's of Hollywood Frederick's of Hollywood Group Inc. (NYSE Amex: FOH) -- http://www.fredericks.com/-- through its subsidiaries, sells women's intimate apparel, swimwear and related products under its proprietary Frederick's of Hollywood brand through 122 specialty retail stores, a world-famous catalog and an online shop. Frederick's of Hollywood sought bankruptcy in July 10, 2000. On Dec. 18, 2002, the court approved the company's plan of reorganization, which became effective on Jan. 7, 2003, with the closing of the Wells Fargo Retail Finance exit financing facility. Mayer Hoffman McCann expressed substantial doubt about the Company's ability to continue as a going concern, citing the company has suffered recurring losses from continuing operations, has negative cash flows from operations, has a working capital and a shareholders' deficiency at July 27, 2013. The Company reported a net loss of $22,522,000 on $86,507,000 of net sales in 2013, compared with a net loss of $6,432,000 in 2012. As of Jan. 25, 2014, the Company had $39.79 million in total assets, $69.01 million in total liabilities and a $29.22 million total shareholders' deficiency. FREDERICK'S OF HOLLYWOOD: FOHG Stake at 86.1% as of mid-April ------------------------------------------------------------- In an amended Schedule 13D filed with the U.S. Securities and Exchange Commission, FOHG Holdings, LLC, Harbinger Group Inc., and Philip A. Falcone disclosed that as of April 15, 2014, they beneficially owned 91,257,883 shares of common stock of Frederick's of Hollywood Group Inc. representing 86.1 percent of the shares outstanding. On April 15, 2014, FOHG Holdings, LLC, FOHG Acquisition Corp., a wholly-owned subsidiary of FOHG Holdings, and Frederick's of Hollywood entered into Amendment No. 1 to the Agreement and Plan of Merger, dated as of April 14, 2014. Pursuant to the Amendment, the parties agreed to extend the Termination Date, as defined in the Merger Agreement, to June 15, 2014. A copy of the regulatory filing is available for free at: http://is.gd/CK3ZuC Frederick's of Hollywood Frederick's of Hollywood Group Inc. (NYSE Amex: FOH) -- http://www.fredericks.com/-- through its subsidiaries, sells women's intimate apparel, swimwear and related products under its proprietary Frederick's of Hollywood brand through 122 specialty retail stores, a world-famous catalog and an online shop. Frederick's of Hollywood sought bankruptcy in July 10, 2000. On Dec. 18, 2002, the court approved the company's plan of reorganization, which became effective on Jan. 7, 2003, with the closing of the Wells Fargo Retail Finance exit financing facility. Mayer Hoffman McCann expressed substantial doubt about the Company's ability to continue as a going concern, citing the company has suffered recurring losses from continuing operations, has negative cash flows from operations, has a working capital and a shareholders' deficiency at July 27, 2013. The Company reported a net loss of $22,522,000 on $86,507,000 of net sales in 2013, compared with a net loss of $6,432,000 in 2012. As of Jan. 25, 2014, the Company had $39.79 million in total assets, $69.01 million in total liabilities and a $29.22 million total shareholders' deficiency. FRESH & EASY: Files Ch. 11 Liquidating Plan ------------------------------------------- Old FENM Inc., f/k/a Fresh & Easy Neighborhood Market Inc., and Old FEPC LLC, f/k/a Fresh & Easy Property Company LLC, filed with the U.S. Bankruptcy Court for the District of Delaware a Chapter 11 liquidating plan, which proposes to pay general unsecured claims in full, plus the postpetition interest amount at the so- called federal judgment rate, or about 0.1 percent. The Plan was not accompanied by a disclosure statement, which states how much creditors stand to recover. The Plan effectuates a global settlement of claims with the Debtors' ultimate parent, Tesco Plc. Pursuant to the settlement, Tesco has agreed to subordinate recoveries on over $581 million in claims against the Debtors and to contribute assets from Old FEPC LLC to Old FENM Inc. so that all other Allowed Claims against the Debtors can be paid in full in cash, and the Plan provides for the general release of all claims by the Debtors and their creditors against Tesco and its representatives and affiliates. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, the supermarket chain had been promising full payment for creditors aside from Tesco. A full-text copy of the Plan dated April 21, 2014, is available for free at http://bankrupt.com/misc/FRESH&EASYplan0421.pdf About Fresh & Easy Fresh & Easy Neighborhood Market Inc., and its affiliate filed Chapter 11 petitions (Bankr. D. Del. Case Nos. 13-12569 and 13-12570) on Sept. 30, 2013. The petitions were signed by James Dibbo, chief financial officer. Judge Kevin J. Carey presides over the case. Fresh & Easy owes $738 million to Cheshunt, England-based Tesco, the U.K.'s biggest retailer. Fresh & Easy never made a profit and lost an average of $22 million a month in the 12 months ended in February, according to court papers. Jones Day serves as lead bankruptcy counsel. Richards, Layton & Finger, P.A., serves as local Delaware counsel. Alvarez & Marsal North America, LLC, serves as financial advisors, and Alvarez & Marsal Securities, LLC, serves as investment banker. Prime Clerk LLC acts as the Debtors' claims and noticing agent. Gordon Brothers Group, LLC, and Tiger Capital Group, LLC, serves as the Debtors' consultant. The Debtors estimated assets of at least $100 million and liabilities of at least $500 million. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed five creditors to serve in the Official Committee of Unsecured Creditors in the Chapter 11 cases of Fresh & Easy Neighborhood Market Inc., et al. Pachulski Stang Ziehl & Jones LLP serves as counsel to the Committee. FTI Consulting, Inc. serves as its financial advisor. The Debtors closed, on or about Nov. 26, 2013, the sale of about 150 supermarkets plus a production facility in Riverside, California, to Ron Buckle's Yucaipa Cos. Pursuant to the sale terms, the bankruptcy company changed its name, and the name of the case, to Old FENM Inc. FRIENDSHIP DAIRIES: Opposes Agstar's Move to Reconsider Stay Order ------------------------------------------------------------------ Friendship Dairies opposes AgStar Financial Services, FLCA's motion for reconsideration of the Bankruptcy Court's Jan. 7 decision to put on hold temporarily its earlier ruling that allowed AgStar to foreclose on its collateral. The Court decision is on hold until a higher court hear Friendship Dairies' appeal to review such ruling. The Debtor also objects to AgStar's alternative motion to reconsider the order granting certain security for stay pending appeal. The Official Committee of Unsecured Creditors also objects to both motions. AgStar is the loan servicer and attorney-in-fact for McFinney Agri-Finance, LLC. The Debtor denies that consideration of new evidence would produce a different result. The Debtor also contends that AgStar provides no basis for the Court to reconsider the sufficiency of the security granted for the Stay Order. For its part, the Committee urges denial of AgStar's Reconsideration Motion. The Committee says as the Court consider confirmation of the Third Amended Plan, AgStar will suffer no harm and its interests will be will be adequately protected. The Committee elaborates that the Debtor is barely a few more days from confirmation. "Dairy prices are presently near $24.00 cwt, or about 50% higher than at confirmation. The Debtor's milk production is on budget and has never been better. Other creditors in the case deserve a chance to reap the benefits of a plan whose technical defects have been corrected and of an operation that will not stumble out of the gate post- confirmation." Darrel Guthrie, Esq., and Brad Odell, Esq. of Mullin Hoard & Brown, L.L.P., as well as Steve Jakubowski, Esq., of Robbins, Salomon & Patt, Ltd., represent the Creditors Committee. 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. FRIENDSHIP DAIRIES: Committee Opposes Staying the Confirmation Hrg ------------------------------------------------------------------ The Official Committee of Unsecured Creditors objects to the motion of AgStar Financial Services, FLCA, to stay consideration of Friendship Dairies' Third Amended Plan pending appeal. AgStar is the loan servicer and attorney-in-fact for McFinney Agri-Finance, LLC. The Bankruptcy Court has set for a May 5, 2014 confirmation hearing on the Debtor's Plan. The Committee asserts that the Court should not stay the confirmation hearing pending resolution of the Debtor's appeal of the Stay Relief Order on the foreclosure sale. If the Third Amended Plan is confirmed, the appeal of the Stay Order will be rendered equitably moot and AgStar will be precluded from foreclosing on its collateral under ther newly entered confirmation order, says the Committee. In a separate filing, the Debtor also opposes AgStar's request. The Debtor admits that if the Stay Relief Order is affirmed after appeal has been exhausted and AgStar proceeds to foreclose on its real estate collateral, there would be a necessity to further amend the Third Amended Plan. However, the Debtor denies that postponing confirmation until after appeal has been exhausted is necessary or mandated. The Debtor maintains that plan confirmation while the appeal is pending would terminate the automatic stay and would correspondingly reinstate payment terms for the Debtor to service its debt to AgStar. "AgStar's motion is simply an attempt to preempt or postpone this result," says the Debtor. The Debtor also denies that plan confirmation would be "for naught." Plan confirmation would provide for termination of the automatic stay and would predominate over the appeal, the Debtor says. Darrel Guthrie, Esq., and Brad Odell, Esq. of Mullin Hoard & Brown, L.L.P., as well as Steve Jakubowski, Esq., of Robbins, Salomon & Patt, Ltd., represent the Creditors Committee. 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. GENCO SHIPPING: Proposes June Confirmation of Prepack Plan ---------------------------------------------------------- Before filing for bankruptcy, Genco Shipping & Trading Limited negotiated a prepackaged plan of reorganization with its secured lenders and major unsecured creditor constituency and completed the solicitation of votes on the plan in order to complete its reorganization on an expedited timeframe. The Plan, which will eliminate $1.2 billion in debt, is premised upon a negotiated settlement with the Company's secured lenders and major unsecured creditor constituency, that will substantially deleverage the Company's financial obligations, and provide the Company with new liquidity through a fully backstopped $100 million rights offering. Parties to the restructuring support agreement ("RSA") are certain of the lenders under the Debtor's $1.1 billion secured credit facility entered into in 2007, its $253 million secured credit facility, and its $100 million secured credit facility, as well as certain holders of the Company's 5.00% Convertible Senior Notes due Aug. 15, 2015. Genco is now asking the bankruptcy court in Manhattan to hold a hearing on June 4 to consider confirmation of the Prepackaged Plan and approval of the explanatory disclosure statement. It wants the court to approve this schedule: Event Date ----- ---- Voting Record Date April 9, 2014 Distribution of Solicitation Package April 16, 2014 Voting Deadline for * 2007 Facility Claims, * $253 Million Facility Claims * $100 Million Facility Claims April 18, 2014 Distribution of Combined Notice April 23, 2014 Voting Deadline for Convertible Note Claims May 16, 2014 Objection Deadline May 22, 2014 Limited Bar Date May 22, 2014 Reply Deadline June 2, 2014 Combined Hearing June 4, 2014 $1.4-Bil. of Funded Debt The Company has over $1.4 billion outstanding under its secured and unsecured debt facilities, comprised of: (a) a $1.377 billion senior secured credit facility with Wilmington Trust, National Association as successor administrative agent and successor collateral agent, which matures on July 20, 2017; (b) a $100 million senior secured credit facility with Cr'dit Agricole Corporate and Investment Bank, as agent and security trustee, which matures on August 17, 2017; (c) a $253 million senior secured credit facility with Deutsche Bank Luxembourg S.A. as agent, which matures on August 14, 2015; and (d) $125 million of unsecured 5% Convertible Senior Notes due 2015 under an indenture dated July 27, 2010, with the Bank of New York Mellon as indenture trustee. The Debtors solicited votes from holders of credit facility claims prepetition, and GCG, Inc., collected and tabulated the ballots. Holders of 100% of the 2007 Credit Facility Claims, the $253 Million Facility Claims and the $100 Million Facility Claims voted to accept the Prepack Plan. Because over 82% of the Convertible Noteholders are party to the restructuring support agreement, the Company expects that the class of Convertible Notes will likewise vote to accept the Plan. Terms of the Plan The Prepack Plan provides for the consensual restructuring of the Company's capital structure through a settlement that maximizes recoveries to all stakeholders and enhances the financial viability of the Company. The Plan eliminates $1.2 billion of secured and unsecured debt, and provides the Company with $100 million of new liquidity through the fully-backstopped rights offering -- 80% of which is backstopped by Supporting 2007 Facility Lenders, and 20% of which is backstopped by supporting noteholders. By virtue of the settlement embodied in the RSA, the Prepack Plan proposes to treat claims and interests as follows: -- Holders of all Allowed Administrative Claims, Priority Tax Claims, statutory fees, Other Priority Claims and Other Secured Claims will be paid in full. Projected Recovery: 100% -- Holders of Allowed General Unsecured Claims (estimated allowed amount at $1 million), including Allowed Claims of trade vendors, suppliers, customers, charterers, and charterer's customers, will not be affected by the filing of the bankruptcy cases and are anticipated to be paid in full in the ordinary course of business during the pendency of the Chapter 11 Cases or reinstated and left unimpaired under the Prepack Plan in accordance with their terms. Projected Recovery: 100% -- 100% of the Claims under the Prepetition 2007 Facility (estimated at $1.056 billion) will be converted into 81.1% of the Reorganized Genco's new common stock (subject to dilution by the warrants issued). Holders of Prepetition 2007 Facility Claims will also be entitled to subscribe to and purchase up to 80% of the New Genco Common Stock being offered under the Rights Offering. Projected Recovery: 91.5% -- The $100 Million Facility (estimated allowed amount at $73.6 million) and the $253 Million Facility (estimated at $176 million) will be amended and restated to extend the maturity dates of those prepetition facilities through August 2019 and provide other modifications to the existing credit agreements. Projected Recovery: 100% -- 100% of the Claims under the Convertible Notes (estimated allowed amount at $125 million) will be converted into 8.4% of the Reorganized Genco's new common stock (subject to dilution by the warrants issued under the Prepack Plan). Holders of Convertible Note Claims will also be entitled to subscribe to and purchase up to 20% of the New Genco Common Stock being offered under the Rights Offering. Projected Recovery: 80.3% -- Holders of Equity Interests in Genco will receive warrants to purchase shares of New Genco from amounts Prepetition 2007 Facility Lenders and the holders of the Convertible Notes have forgone in exchange for the cancellation or surrender of Equity Interests in Genco. They will receive warrants to purchase 6% of New Genco Common Stock (subject to dilution) exercisable for a period of 7 years from the Effective Date at a cash-less strike price of $20.99 at a total implied equity value of $1.295 billion. Projected Recovery: $32.9 million. Despite the fact that holders of Prepetition 2007 Facility Claims and holders of Convertible Note Claims are not being paid in full under the Prepack Plan, as part of the settlement embodied by the RSA, the Company negotiated for the reinstatement of Allowed General Unsecured Claims under the Prepack Plan to avoid any disruption to the orderly operation of the businesses, and for the reinstatement or payment in full of Claims in certain other Classes. The Company anticipates commencing the rights offering on April 28, 2014 (i.e., 7 days following the Petition Date), or as soon as reasonably practicable thereafter. The rights offering will end, and any unexercised rights will expire, at 5:00 p.m. (prevailing New York time) on May 29, 2014. A copy of the Prepackaged Plan is available for free at: http://bankrupt.com/misc/Genco_Shipping_Plan.pdf A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/Genco_Shipping_Disc_Statement.pdf A copy of the affidavit in support of the first-day motions is available for free at: http://bankrupt.com/misc/Genco_1st_Day_Affidavit.pdf About Genco Shipping & Trading New York-based Genco Shipping & Trading Limited (NYSE: GNK) transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Excluding Baltic Trading Limited's fleet, Genco Shipping owns a fleet of 53 drybulk vessels, consisting of nine Capesize, eight Panamax, 17 Supramax, six Handymax and 13 Handysize vessels, with an aggregate carrying capacity of approximately 3,810,000 dwt. In addition, Genco Shipping's subsidiary Baltic Trading Limited currently owns a fleet of 13 drybulk vessels, consisting of four Capesize, four Supramax, and five Handysize vessels. Genco Shipping & Trading sought bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 14-11108) on April 21, 2014, to implement a prepackaged financial restructuring that is expected to reduce the Company's total debt by $1.2 billion and enhance its financial flexibility. The company's subsidiaries other than Baltic Trading Limited (and related entities) also sought bankruptcy protection. Genco, owned and controlled by Peter Georgiopoulos, disclosed assets of $2.448 billion and debt of $1.475 billion as of Feb. 28, 2014. Kramer Levin Naftalis & Frankel LLP serves as the bankruptcy counsel and Blackstone Advisory Partners, L.P., is the financial advisor. GCG Inc. is the claims and notice agent and maintains the Web site http://gencorestructuring.com/ GENCO SHIPPING: Deal With Lenders Has $26.5-Mil. Termination Fee ---------------------------------------------------------------- Genco Shipping & Trading Limited, which has filed a prepackaged Chapter 11 plan of reorganization that will eliminate $1.2 billion of debt, is asking the bankruptcy court to: (i) authorize the assumption of a restructuring support agreement ("RSA") with certain of the lenders under the Debtor's $1.1 billion secured credit facility entered into in 2007, its $253 million secured credit facility, and its $100 million secured credit facility, as well as certain holders of 5.00% Convertible Senior Notes due Aug. 15, 2015; and (ii) approve a termination fee in the event the Debtors pursue an alternative transaction. After months of extensive, arm's-length and multi-party negotiations, the Debtors entered into the RSA with its secured lenders under all three of its prepetition secured credit facilities and an ad hoc group of the Debtors' largest unsecured creditor constituency, the convertible notes. The RSA establishes the framework and support for the Debtors' prepackaged plan of reorganization. With the overwhelming support of all of its creditor constituencies, the RSA paves the way for a settlement that allows the Company to exit chapter 11 expeditiously and thereby preserve business operations. According to the Debtors, the assumption of the RSA ensures that the agreement that forms the foundation for a consensual restructuring continues to be valid and enforceable against all signatories and continues to provide the Debtors with the benefits they bargained for thereunder. The RSA not only requires the supporting creditors to vote in favor of the Prepack Plan, but it prohibits such parties from opposing confirmation or the approval of the disclosure statement. The RSA contains a reasonable "fiduciary out" allowing the Company to continue exercising its fiduciary duties throughout the cases, including, in consideration for a termination fee, allowing the Company to receive, review, and negotiate unsolicited alternative transactions. In consideration of the Supporting 2007 Facility Lenders and the Convertible Noteholders' commitments under the RSA to voluntarily and dramatically deleverage the Company and provide $100 million of new capital -- which, in turn, provides a benchmark for the analysis of any other alternatives received -- the Company agreed to provide for a termination fee to be owed to the Supporting 2007 Facility Lenders and the Supporting Noteholders in the aggregate amount of $26.5 million, plus expense reimbursements owing under the RSA, solely in the event the RSA is terminated to allow the Company to pursue an alternative transaction, and such alternative transaction is actually consummated. The Debtors are required under the RSA to comply with various milestones, including: -- The Cash Collateral Order shall have been approved (i) on an interim basis, on or before the fifth business day after the Petition Date and (ii) on a final basis, on or before the 45th day after the Petition Date; -- The order approving the assumption of the RSA will have been approved on or before the fifth business day after the Petition Date; -- The order approving the Disclosure Statement and the solicitation procedures and confirming the Plan shall be entered on or before the 45th day after the Petition Date; and -- The effective date of the Plan shall occur on or before the later of (i) 10 days following the Confirmation Date, (ii) completion of the Rights Offering, or (iii) notice from the respective lenders that the conditions to the closing of the New $253 Million Facility and New $100 Million Facility (each as defined in the Restructuring Term Sheet) have been satisfied or waived. About Genco Shipping & Trading New York-based Genco Shipping & Trading Limited (NYSE: GNK) transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Excluding Baltic Trading Limited's fleet, Genco Shipping owns a fleet of 53 drybulk vessels, consisting of nine Capesize, eight Panamax, 17 Supramax, six Handymax and 13 Handysize vessels, with an aggregate carrying capacity of approximately 3,810,000 dwt. In addition, Genco Shipping's subsidiary Baltic Trading Limited currently owns a fleet of 13 drybulk vessels, consisting of four Capesize, four Supramax, and five Handysize vessels. Genco Shipping & Trading sought bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 14-11108) on April 21, 2014, to implement a prepackaged financial restructuring that is expected to reduce the Company's total debt by $1.2 billion and enhance its financial flexibility. The company's subsidiaries other than Baltic Trading Limited (and related entities) also sought bankruptcy protection. Genco, owned and controlled by Peter Georgiopoulos, disclosed assets of $2.448 billion and debt of $1.475 billion as of Feb. 28, 2014. Kramer Levin Naftalis & Frankel LLP serves as the bankruptcy counsel and Blackstone Advisory Partners, L.P., is the financial advisor. GCG Inc. is the claims and notice agent and maintains the Web site http://gencorestructuring.com/ GENERAL MOTORS: Confirms Investigations Under Way ------------------------------------------------- Joseph B. White, writing for The Wall Street Journal, reported that General Motors Co. confirmed in a government filing that it is under investigation by federal prosecutors, the Securities and Exchange Commission, a state attorney general, Congress and the National Highway Traffic Safety Administration for its handling of a recent rash of recalls, including those involving 2.6 million cars with faulty ignition switches. According to the report, GM formally confirmed the existence of a federal criminal probe of the recall by the U.S. Attorney for the Southern District of New York, in its quarterly report to the SEC filed on April 24. GM had earlier reported an 82% drop in first quarter earnings, largely because of a $1.3 billion charge related to the ignition switch and other recalls. GM said it believes it is "cooperating fully" with requests for information from the various investigating agencies, although it is paying fines to NHTSA for missing an April 3 deadline to respond fully to questions from the auto-safety regulator, the report related. It isn't clear from GM's filing what aspects of the ignition- switch recall matter the SEC or the unidentified state attorney general are investigating, the report further related. The company says in the filing it isn't currently able to estimate the potential costs of lawsuits or investigations tied to the ignition recall, but adds resolving the probes could have a "material adverse impact" on the company's finances, the report added. About General Motors Corp., nka Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. GENERAL MOTORS: Profit Falls 82% Amid Recalls --------------------------------------------- Jeff Bennett, writing for The Wall Street Journal, reported that General Motors Co. said first-quarter results fell 82% but far exceeded Wall Street expectations, as the push to sell cars and trucks at higher prices in North America helped the auto maker offset the cost of model recalls. According to the report, the company reported a first-quarter profit of $213 million, before the payout of preferred dividends, compared with $1.18 billion a year earlier. It was the worst quarterly performance since the company exited bankruptcy. However, GM posted adjusted earnings of 29 cents a share, which included special items totaling 23 cents, beating analyst expectations of 4 cents a share, according to analysts polled by Thomson Reuters. Revenue rose to $37.4 billion from $36.9 billion, the Journal said. "The recall campaign charges in the first quarter overshadowed the headline results," the Journal cited GM Chief Financial Officer Chuck Stevens as saying. About General Motors Corp., nka Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. GRAFTECH INTERNATIONAL: S&P Revises Outlook & Affirms 'BB+' CCR --------------------------------------------------------------- Standard & Poor's Ratings Services said it revised the rating outlook on Parma, Ohio-based GrafTech International Ltd. to negative from stable. S&P also affirmed its 'BB+' corporate credit rating on the company. The issue rating on the company's senior unsecured debt is unchanged at 'BB+', with the recovery rating remaining '4', indicating S&P's expectation of average recovery (30%-50%) in the event of a payment default. The negative outlook reflects that debt to EBITDA increased to 4.6x from 2.5x in 2013 (2013 EBITDA includes restructuring costs). While S&P do not expect a return to previous levels of leverage within the next year, it believes that rationalization initiatives should bring profitability levels back in line with historical norms by the end of 2014, and leverage levels will begin to fall. The revised outlook reflects the uncertainty in profitability levels following the rationalization initiatives, as well as the possibility that the company's increased sensitivity to soft end markets may represent a shift in the graphite electrode industry. "The negative outlook reflects our view that although GrafTech's credit measures are currently below the "intermediate" financial risk profile assessment, the company has a credible path toward getting back in line with its rating," said Standards & Poor's credit analyst Chiza Vitta. "Nevertheless, material improvements in profitability will need to materialize by the end of the year, and the negative outlook expresses the possibility that rationalization initiatives may not translate into credit measures commensurate with the rating." S&P could downgrade GrafTech if third-quarter EBITDA does not improve to $50 million. This could happen if the company's profitability improvements, as a result of rationalization, fall short of expectations or take longer than anticipated. A stable outlook will be predicated on reducing and maintaining leverage below 3x. This would most likely be associated with gross margins (excluding depreciation and amortization) returning to 25% or better. GREAT PLAINS: US Trustee Objects to RBS Settlement Agreement ------------------------------------------------------------ Roberta A. DeAngelis, the U.S. Trustee for Region 3, filed with the U.S. Bankruptcy Court for the Western District of Pennsylvania an objection to the approval of Oz Gas LTD, Great Plains Exploration LLC, and John D Oil and Gas Company's settlement agreement with RBS Citizens Bank. The U.S. Trustee states in an April 16 court filing that she "objects to the inclusion of any provisions in the settlement agreement and order which restrict the Chapter 11 trustee's independent performance of his or her fiduciary duties, including those which require the trustee to sell assets and those which limit the trustee's exclusive control of the Debtors' businesses." On March 19, the Debtors sought court-approval of the Agreement. As settlement of RBS's $20,532,453.67 secured claims, key terms of the Agreement include, among other things: a. Payment of $10,800,000 to RBS by June 30, 2014, in full and complete settlement of each and every claim against the Debtors and obligors; b. If RBS does not receive the RBS Settlement Amount by the Settlement Deadline, RBS will receive by Sept. 30, 2014, the Settlement Amount plus 20% of the unpaid balance of the Settlement Amount as of the RBS Settlement Deadline in full and complete settlement of each and every claim c. Upon notice of an Event of Default, the U.S. Trustee will immediately appoint a trustee with Limited Powers; and d. RBS will have an allowed prepetition secured claim under Section 506(a) of the Bankruptcy Code in an amount to be determined, subject to the right of the Debtors to dispute the amount. In a March 17 court filing, Great Plains submits that it, in good faith, believes the consummation of this agreement will allow it to submit a confirmable plan of reorganization. The Agreement requires approval from the RBS parent entity in the UK, but that counsel has been advised by RBS that the approval is likely to be approved. The Debtors filed on March 17 motions to stay the appointment of a Chapter 11 trustee until adjudication of the motion filed under Rule 9019 requesting the court approval of the Agreement. The Agreement required by the Court to avoid the appointment of a trustee was reached, negating cause for appointment. On Feb. 24, the Court ordered the Debtors to file (i) a notice to indicate whether or not they have reached an agreement with RBS, and (ii) a motion by March 17 asking that the Court stay the appointment of a Chapter 11 trustee pending the plan confirmation process. RBS is represented by: Frederick D. Rapone, Jr., Esq. Campbell & Levine, LLC 1700 Grant Building Pittsburgh, PA 15219 Tel.: (412) 261-0310 Fax: (412) 261-5066 and Andrew C. Kassner, Esq. Drinker Biddle & Reath, LLP One Logan Square, Suite 2000 Philadelphia, PA 19103 Tel: (215) 988-2700 Fax: (215) 988-2757 E-mail: andrew.kassner@dbr.com About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GREAT PLAINS: Reaches Stipulation With Wells Fargo -------------------------------------------------- Great Plains Exploration LLC reached an agreement with Wells Fargo Equipment Finance, Inc., resolving Wells Fargo's motion for relief from stay and motion to convert the Debtor's Chapter 11 case to one under Chapter 7. Upon court approval of the Stipulation, Wells Fargo is irrevocably granted relief from the automatic stay. As reported by the Troubled Company Reporter on Oct. 21, 2013, Wells Fargo said that the Debtor has had more than adequate opportunity to restructure its business operations and present a viable plan of reorganization, but failed to do so, thus the Court should convert the Debtor's bankruptcy case to Chapter 7. The Debtor objected to the conversion motion, citing, among other things, that Wells Fargo is adequately protected by its lien on the collateral, is receiving interest payments in accordance with the prior adequate protection stipulation, and does not set forth sufficient grounds for converting the case. On Feb. 24, 2014, the Hon. Thomas P. Agresti of the U.S. Bankruptcy Court for the Western District of Pennsylvania entered an order requiring the Debtor and Wells Fargo to file by March 10, 2014, a proposed consent order that will completely resolve Wells Fargo's stay motion if approved by the Court. At all times during which the Debtor is not in default of the Stipulation, Wells Fargo agrees to forbear from taking any action to collect the amounts due under the loans from the Debtor and Richard M. Osborne, Sr., or to recover and liquidate certain equipment. The Debtor financed the purchase of the Equipment through Wells Fargo by entering into Promissory Note Number 181655-700, Promissory Note Number 181655-702, and Promissory Note Number 181655-703 and related loan documents and security agreements. Beginning on the date the Court approves the Stipulation, the interest on the total outstanding balance due on the Loans will accrue at an annual rate of 6%. Pursuant to the parties' agreement and in anticipation of the Stipulation, the Debtor paid $50,000 to Wells Fargo. Beginning on or before April 1, 2014, the Debtor will make monthly payments in the amount of $45,000 to Wells Fargo on or before the first day of each month thereafter until the total amount owed by the Debtor on the Loans, including, without limitation, accrued interest, is paid in full. The terms of any Chapter 11 plan filed (i) will include the terms of the Stipulation, which will survive confirmation of any Chapter 11 plan notwithstanding anything contained therein; or (ii) will provide for either payment in full of all outstanding amounts due under the Loans on the effective date of the plan or provide for the return of the Equipment to Wells Fargo. Wells Fargo is represented by: Scott E. Schuster, Esq. McGuire Woods LLP 625 Liberty Avenue, 23rd Floor Pittsburgh, PA 15222 Tel: (412) 667-7931 E-mail: sschuster@mcguirewoods.com About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GREAT PLAINS: Fights 1st Source's Motion for Relief From Stay ------------------------------------------------------------- Great Plains Exploration LLC asks the U.S. Bankruptcy Court for the Western District of Pennsylvania to deny 1st Source Bank's motion to terminate the automatic stay. On March 20, 2014, the Bank sought relief from automatic stay to sell certain personal property collateral, claiming that the Debtor is not able to provide adequate protection to the Bank. The Bank and Debtor executed and entered on May 21, 2007, into a loan and security agreement whereby the Bank agreed to extend credit to the Debtor for purposes of the Debtor acquiring or purchasing certain vehicles, equipment and machinery, which are items constituting the collateral. The Debtor agreed to grant a security interest in the collateral as security for the extension of credit. The Debtor has defaulted in the monthly payments to the Bank. The regular monthly payment due is $26,886.02. As of March 9, 2014, the payoff of the amount due and owing the Bank by the Debtor is $596,384.74. Interest continues to accrue on the principal amount at the rate of $95.90 per day. The Bank believes that the value of the collateral does not provide adequate protection to the Bank considering the depreciating value of the collateral, additional costs to the Bank of continuing interest and late charges, and additional amounts accruing related to attorneys' fees and court costs. The collateral is believed to be in the possession of Debtor. On April 7, 2014, the Debtor filed a response to the Bank's motion, asking the Court to deny the motion. According to the Debtor, the Bank attempts to impermissibly inflate its claim so as to cause the appearance of a lack of security. The Bank asserts that the payoff for its loans to Debtor is now $596,384.74. The Debtor says in its April 7 court filing that in formulating this calculation, the Bank includes such items as interest, late fees, legal fees and non legal expenses totaling $214,800.95. The Debtor disputes the amount and the permissibility of these charges under the Bankruptcy Code. The Bank's new calculation also ignores that fact that the parties agreed that the amount of the claim is $484,731.14 and cannot be amended, the Debtor states. The Court approved this agreement on Nov. 6, 2013. The Bank is represented by: Marsh Spaeder Baur Spaeder & Schaaf, LLP Kurt L. Sundberg, Esq. 300 State Street, Suite 300 Erie, Pennsylvania 16507 Tel: (814) 456-5301 E-mail: ksundberg@marshspaeder.com About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GREAT PLAINS: US Trustee Blocks Cash Collateral Order Amendment --------------------------------------------------------------- Roberta A. DeAngelis, the U.S. Trustee for Region 3, filed with the U.S. Bankruptcy Court for the Western District of Pennsylvania an objection to Oz Gas LTD; Great Plains Exploration LLC; John D Oil and Gas Company's motions for entry of a first amended final order authorizing the use of cash collateral until Sept. 30, 2014. The U.S. Trustee objects to the inclusion of any provisions in the amended final court order authorizing the use of cash collateral which restrict the Chapter 11 trustee's independent performance of his or her fiduciary duties, including those which require the trustee to sell assets and those which limit the trustee's exclusive control of the Debtors' businesses. On March 19, 2014, the Debtors filed their motions to amend the final cash collateral, saying that they have reached an agreement with RBS Citizens Bank, "which not only facilitates the payment of RBS, but also permits the Debtor the opportunity to continue its business and work to effectuate a plan of reorganization." The Debtors state in their March 19 court filing that they can continue to provide adequate protection to RBS for the use of cash collateral. "It is therefore appropriate and essential to the preservation of the value of Debtor's estate that the Court authorize the Debtor's use of cash collateral pursuant to Section 363(c)(2)(B) of the Bankruptcy Code for ordinary course of business expenditures and such other expenditures as may be authorized by this Court," the Debtors say. About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. HEARTHSIDE GROUP: Moody's Keeps CFR Over Revised Capital Structure ------------------------------------------------------------------ Moody's Investors Service said that Hearthside Group Holdings LLC's B2 Corporate Family Rating, B1 Secured Revolving Credit Facility rating, B1 Senior Secured First Lien Term Loan rating, Caa1 Senior Unsecured Notes rating and B2-PD Probability of Default Rating will be unchanged by Hearthside's revised capital structure. Hearthside's announced that it will upsize its senior unsecured notes to $300 million from $270 million and reduce the first lien secured term loan to $565 million from $575 million. The additional $20 million debt proceeds will be used to repay $16 million capital leases, add $2 million cash to the balance sheet with the remaining being paid out as incremental fees. Hearthside Group Holdings LLC., with over $1 billion in annual sales, is the leading contract manufacturer and supplier of companies such as General Mills, Johnson & Johnson, Kellogg's, Kraft, PepsiCo, Mondelez and Starbucks. Upon consummation of the transaction, the company will be owned by Goldman Sachs PIA and Vestar Capital Partners. HEMISPHERE MEDIA: S&P Affirms 'B' CCR; Outlook Stable ----------------------------------------------------- Standard & Poor's Ratings Services affirmed all ratings, including the 'B' corporate credit rating, on U.S. Hispanic television and cable broadcaster Hemisphere Media Group Inc. The outlook is stable. "We are affirming ratings following our revision of our financial risk profile on Hemisphere Media Group to "significant" from "highly leveraged" because of our expectations for leverage to decline to, and remain below, 4x. At the same time, we maintained our "weak" business risk profile assessment on the company. The "weak" business risk profile, as per our criteria, is based on the company's limited scale with only a single TV broadcasting station in Puerto Rico and five U.S.-based and two Latin America-based Spanish language cable networks, pro forma for the April 2014 Media World LLC acquisition," S&P said. S&P also weighs the company's narrow business focus, primarily targeting Hispanics living in the U.S. S&P views Hemisphere Media Group's management and governance as "fair." The company has a very short operating history, having only come into existence in January 2013, though the underlying businesses have long operating histories. S&P expects management to continue making acquisitions over the long term to build scale. Pro forma for the April 2014 acquisition of the three Media World LLC cable networks, Hemisphere has liquidity to fund acquisitions of up to about $75 million (based on its Dec. 31, 2014, cash balance as the company does not currently have a revolving credit facility). Therefore, S&P expects the company would need to access the capital markets over the intermediate term to continue its aggressive acquisition-driven growth strategy. "We believe the company's focus on Hispanics living in the U.S. provides the company some protection from broad English-language competition, but also limits growth prospects. Its WAPA television station and cable network focus on a smaller subsegment, Puerto Ricans and Caribbean Hispanics, while the newly acquired Media World cable networks focus on Central American and Dominican populations living in the U.S. Although we believe these subsegments are underserved by the larger Hispanic broadcasters that have traditionally focused on Mexican Americans, we think that increasing penetration of Hispanic households will be difficult. We also view the competition for ad spending targeting Hispanic consumers as growing steadily, while the arena remains dominated by Univision Communications Inc. The company's five U.S.-based cable networks are not generally included in most cable operators' basic tier, which leads to lower penetration and lower subscription and advertising revenue. Currently, the five cable networks each reach about 5 million households in the U.S. We estimate that subscription revenue, pro forma for the Media World transaction, will account for roughly 50% of total revenues, in-line with 40% to 60% for larger cable networks," S&P noted. HORIZON LINES: New Subsidiaries Guarantee Outstanding Debt ---------------------------------------------------------- Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., and Road Raiders Logistics, Inc., entered into various agreements to become additional guarantors in connection with certain outstanding indebtedness of Horizon Lines, Inc. Each of the New Subsidiaries is a wholly-owned subsidiary of Horizon. On March 6, 2014, each of the New Subsidiaries entered into a joinder agreement, individually titled Joinder No. 1 to ABL Security Agreement, Joinder No. 2 to ABL Security Agreement, Joinder No. 3 to ABL Security Agreement and Joinder No. 4 to ABL Security Agreement. Each of the joinder agreements is with Wells Fargo Capital Finance, LLC, in its capacity as agent for the secured party and the bank product providers, and the joinder agreements provided that the applicable New Subsidiary became a guarantor under the Guaranty, a grantor under the Security Agreement and a party to the Intercreditor Agreement in connection with the Company's ABL Credit Agreement, dated Oct. 5, 2011. In addition, on March 6, 2014, each of the New Subsidiaries entered into separate joinder agreements relating to Horizon's $20,000,000 Term Loan Agreement dated Jan. 31, 2013. The joinder agreements are individually titled Joinder No. 1 to Guaranty and Security Agreement, Joinder No. 2 to Guaranty and Security Agreement, Joinder No. 3 to Guaranty and Security Agreement and Joinder No. 4 to Guaranty and Security Agreement. Each of the joinder agreements is with U.S. Bank National Association, as collateral agent and ship mortgage trustee for the secured parties under the $20M Term Loan Agreement and provides that the New Subsidiaries become a guarantor under the term loan agreement. On March 20, 2014, the New Subsidiaries entered into a Third Supplemental Indenture which added the New Subsidiaries as additional guarantors to Horizon's existing indenture governing its 11.00 percent First Lien Senior Secured Notes due 2016. On the same date, the New Subsidiaries also entered into two Fourth Supplemental Indentures which added the New Subsidiaries as additional guarantors to Horizon's existing indentures governing its 6.00 percent Series A Convertible Senior Secured Notes due 2017, its 6.00 percent Series B Mandatorily Convertible Senior Secured Notes and its Second Lien Senior Secured Notes due 2016. Each of the existing indentures is dated Oct. 5, 2011. Furthermore, on March 20, 2014, in connection with the First Lien Notes, the Series A Notes, the Series B Notes and the Second Lien Notes, the New Subsidiaries also entered into three separate agreements, each titled a Joinder to Security and Pledge Agreement, joining them to the applicable Security and Pledge Agreement among Horizon, the other guarantors thereto and U.S. Bank National Association, in its capacity as collateral agent for the secured parties. Pursuant to each of the three joinder agreements, the New Subsidiaries agreed to guarantee the obligations under each of the indentures governing the First Lien Notes, the Series A Notes, the Series B Notes and the Second Lien Notes. About Horizon Lines Charlotte, N.C.-based Horizon Lines, Inc. (NYSE: HRZ) is the nation's leading domestic ocean shipping and integrated logistics company. The Company owns or leases a fleet of 20 U.S.-flag containerships and operates five port terminals linking the continental United States with Alaska, Hawaii, Guam, Micronesia and Puerto Rico. The Company provides express trans-Pacific service between the U.S. West Coast and the ports of Ningbo and Shanghai in China, manages a domestic and overseas service partner network and provides integrated, reliable and cost competitive logistics solutions. The Company's balance sheet at Sept. 22, 2013, showed $642.85 million in total assets, $675.01 million in total liabilities and a $32.16 million total stockholders' deficiency. * * * In June 2012, Moody's Investors Service affirmed Horizon Lines, Inc.'s Corporate Family Rating (CFR) and Probability of Default Rating ("PDR") at Caa2 and removed the LD ("Limited Default") designation from the rating in recognition of the conversion to equity of the $228 million of Series A and Series B Convertible Senior Secured notes due in October 2017 ("Notes"). Moody's said the affirmation of the Corporate Family and Probability of Default ratings considers that total debt has been reduced by the conversion of the Notes, but also recognizes the significant operating challenges that the company continues to face. HUCKABEE RENTALS: Case Summary & 8 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Huckabee Rentals, LLC P.O. Box 51 Poughkeepsie, AR 72569 Case No.: 14-12270 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court Eastern District of Arkansas (Batesville) Judge: Hon. Audrey R. Evans Debtor's Counsel: Kevin P. Keech, Esq. KEECH LAW FIRM, PA 4800 West Commercial Drive N. Little Rock, AR 72116 Tel: (501)221-3200 Fax: (501)221-3201 Email: kkeech@keechlawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Doyan Huckabee, member. A list of the Debtor's eight largest unsecured creditors is available for free at http://bankrupt.com/misc/areb14-12270.pdf INDIGO-ENERGY INC: Incurs $1.6 Million Net Loss in 2012 ------------------------------------------------------- Indigo-Energy, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $1.58 million on $0 of net revenue for the year ended Dec. 31, 2012, as compared with a net loss of $4.90 million on $0 of net revenue in 2011. The Company's balance sheet at Dec. 31, 2012, the Company had $17,487 in total assets, $12.50 million in total liabilities, all current, and a $12.48 million total stockholders' deficit. "Subsequent to the emergence from receivership on July 29, 2013, the Company plans to raise funds from private offerings of equity as applicable and pursue entry into a business agreement with an operating entity. Since the Company does not have any firm funding commitments, and no operations, there is a substantial doubt about the Company's ability to continue as a going concern," the Company said in the annual report. A copy of the Form 10-K is available for free at: http://is.gd/b0eJDT About Indigo-Energy Henderson, Nev.-based Indigo-Energy, Inc., is an independent energy company, currently engaged in the exploration of natural gas and oil. INERGETICS INC: Had $4.19-Million Net Loss in 2013 -------------------------------------------------- Inergetics, Inc., had a net loss of $4.19 million on $848,000 of revenues in 2013, following a net loss of $4.28 million on $91,900 of revenue in 2012, according to a Form 10-K filing with the U.S. Securities and Exchange Commission. The Company had a net loss of $5.47 million in 2011. Friedman LLP expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred substantial accumulated deficits and operating losses and has a working capital deficiency of $6.12 million. The Company's balance sheet at Dec. 31, 2013, showed $6.08 million in total assets, $13.03 million in total liabilities, and a stockholders' deficit of $15.7 million. A copy of the Form 10-K is available at: http://is.gd/yFdCtn About Inergetics Inc. Paramus, N.J.-based Inergetics, Inc., formerly Millennium Biotechnologies Group, Inc., is a holding company for its subsidiary Millennium Biotechnologies, Inc. Millennium is a research based bio-nutraceutical corporation involved in the field of nutritional science. Millennium's principal source of revenue is from sales of its nutraceutical supplements, Resurgex Select(R) and Resurgex Essential(TM) and Resurgex Essential Plus(TM) which serve as a nutritional support for immuno-compromised individuals undergoing medical treatment for chronic debilitating diseases. Millennium has developed Surgex for the sport nutritional market. The Company's efforts going forward will focus on sales of Surgex in powder, bar and ready to drink forms. INSITE VISION: Burr Pilger Mayer Has Going Concern Doubt -------------------------------------------------------- InSite Vision Incorporated had net income of $5.78 million on $30.82 million of revenues in 2013, compared with a net loss of $8.28 million on $21.64 million of revenues in 2012, according to the Company's latest Form 10-K filed with the U.S. Securities and Exchange Commission. Burr Pilger Mayer, Inc., expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has recurring losses from operations, available cash and short-term investment balances and accumulated deficit. The Company's balance sheet at Dec. 31, 2013, showed $14.2 million in total assets, $49.3 million in total liabilities, and a stockholders' deficit of $35.1 million. A copy of the Form 10-K is available at: http://is.gd/vScDlA Based in Alameda, California, InSite Vision Incorporated (OTCBB: INSV) -- http://www.insitevision.com/-- is committed to advancing new and superior ophthalmologic products for unmet eye care needs. The company's product portfolio utilizes InSite Vision's proven DuraSite(R) bioadhesive polymer core technology, an platform that extends the duration of drug retention on the surface of the eye, thereby reducing frequency of treatment and improving the efficacy of topically delivered drugs. INSTITUTO MEDICO: Taps Monge Robertin as Restructuring Advisors --------------------------------------------------------------- Instituto Medico del Norte, Inc., asks the U.S. Bankruptcy Court for the District of Puerto Rico for permission to employ Jose M. Monge Robertin, CPA, CIRA, CGMA and Monge Robertin & Asociados, Inc., as insolvency and restructuring advisors. The firm will provide services required in the reorganization process of the Debtor in the areas of Plan Development, Liquidation Analysis, Claims Administration, feasibility, negotiations, investment, financing and other matters to assist counsel and the Debtors' reorganization. The firm has required a $500,000 deposit for its services. To the best of the Debtor's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Instituto Medico del Norte, Inc. Instituto Medico del Norte, Inc., aka Centro Medico Wilma N. Vazquez, aka Hospital Wilma N. Vazquez Skill Nursing Facility of Centro Medico Wilma N. Vazquez, sought protection under Chapter 11 of the Bankruptcy Code on Oct. 30, 2013 (Bankr. D.P.R. Case No. 13-08961). The case is assigned to Judge Mildred Caban Flores. The Debtor scheduled $20,843,692 in total assets and $20,107,642 in total liabilities. The Debtor, however, said its real property has a book value of $16,000,000 and personal property is worth $6,105,979. The Debtor is represented by Fausto David Godreau Zayas, Esq., and Rafael A. Gonzalez Valiente, Esq., at Latimer Biaggi Rachid & Godreau, in San Juan, Puerto Rico. Luis B. Gonzalez & Co. CPA's P.S.C. serves as accountant. The U.S. Trustee for the District of Puerto Rico in December appointed Dr. Carlos Mellado (b/t Lcda Dinorah Collazo Ortiz) as patient care ombudsman. INSTITUTO MEDICO: UST Bid to Dismiss Case Deemed as Moot -------------------------------------------------------- The Bankruptcy Court has deemed as moot the request to dismiss the Chapter 11 case of Instituto Medico Del Norte, Inc. The Court, according to a minute entry for hearing held March 20, 2014, said that the quarterly fees have been paid. As reported in the Troubled Company Reporter, Guy G. Gebhardt, the Acting United States Trustee for Region 21, petitioned for dismissal of the Debtor's case. The U.S. Trustee stated that it filed the motion to dismiss because the Debtor, a corporation, had failed to pay its quarterly fees (in the amount of $12,675.00) as required under 28 U.S.C Section 1930. The U.S. Trustee further stated that the Debtor's behavior demonstrates that it has no intention to comply with its duties and that its behavior is prejudicial to its creditors. Meanwhile, the Acting U.S. Trustee has withdrawn, without prejudice, his objection to the prepetition fees sought in Instituto Medico Del Norte's motion to employ counsel. On Feb. 13, 2014, the U.S. Trustee objected to the fee application noting of the charges for certain prepetition fees, and the charges for expenses for failure to comply with P.R. LBR 2016-1(b)(1). About Instituto Medico Instituto Medico del Norte, Inc., aka Centro Medico Wilma N. Vazquez, aka Hospital Wilma N. Vazquez Skill Nursing Facility of Centro Medico Wilma N. Vazquez, sought protection under Chapter 11 of the Bankruptcy Code on Oct. 30, 2013 (Bankr. D.P.R. Case No. 13-08961). The case is assigned to Judge Mildred Caban Flores. The Debtor scheduled $20,843,692 in total assets and $20,107,642 in total liabilities. The Debtor, however, said its real property has a book value of $16,000,000 and personal property is worth $6,105,979. The Debtor is represented by Fausto David Godreau Zayas, Esq., and Rafael A. Gonzalez Valiente, Esq., at Latimer Biaggi Rachid & Godreau, in San Juan, Puerto Rico. Luis B. Gonzalez & Co. CPA's P.S.C. serves as accountant. The U.S. Trustee for the District of Puerto Rico in December appointed Dr. Carlos Mellado (b/t Lcda Dinorah Collazo Ortiz) as patient care ombudsman. INTERFACE SECURITY: Moody's Affirms B3 Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed all ratings of Interface Security Systems Holdings, Inc. ("ISS"), including the Corporate Family Rating at B3. The rating outlook is stable. Ratings Rationale The affirmation of the ratings and the outlook is based on Moody's expectations for both more profitable growth and enhanced liquidity going forward. In early January ISS closed on the $43 million sale of its Hawk Security residential alarm monitoring service, using $13 million of the proceeds to bolster its cash position somewhat (and the remainder for a dividend). Year-end liquidity was weak, as substantially higher operating costs to service new-RMR-generating (recurring monthly revenue) customers and higher capital expenditures for system assets led to a diminished cash position. At the same time, revolver availability contracted as well, leading to Moody's concern over liquidity. While ISS typically operates with a minimal liquidity position, that approach may not be feasible as the company continues to seek high growth. Moody's estimates that the combination of divestiture cash proceeds and revolver availability puts ISS's current liquidity at about $20 million, leading to Moody's affirmation of the company's ratings and the expectation for improving liquidity to fund growth. The stable outlook reflects Moody's view that the cash, combined with revolver availability and a slowdown in growth expenditures, would enable Interface to maintain an adequate liquidity profile, perhaps at the necessary expense of forestalling historically rapid revenue growth. The ratings could be downgraded in the event ISS's heightened concentration in the more profitable, commercial physical security business fails to lead to stronger cash flows this year, or if the company raises a considerable amount of debt to fund operating-cash shortfalls. A ratings upgrade, while unforeseen at this point, could result from the company's producing consistent, positive operating cash flows, putting it in a position of lessened reliance on debt markets to sustain its operations. Interface Security Systems, LLC provides physical security and secured computer network services to approximately 70 thousand primarily commercial customers in the U.S.. Physical security offerings include: alarm/event monitoring, interactive video surveillance, managed access control, and fire/life safety systems. Secured network offerings include: secure broadband network monitoring, secure processing of credit card payments, and managed IP phone systems. Moody's anticipates 2014 revenues of about $130 million. Interface is majority-owned by affiliates of SunTx. Interface Security Systems Holdings, Inc. Probability of Default Rating, Affirmed B3-PD Corporate Family Rating, Affirmed B3 Senior Secured Regular Bond/Debenture Jan 15, 2018, Affirmed B3, LGD 4-55% INVESTMENTS GP: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Investments GP & SR, Inc. Po Box 340 Barrio Miradero Mayaguez, PR 00681-0340 Case No.: 14-03214 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Puerto Rico (Ponce) Debtor's Counsel: Gloria M Justiniano Irizarry, Esq. JUSTINIANO'S LAW OFFICE Ensanche Martinez 8 DR. A Ramirez Silva Mayaguez, PR 00680-4714 Tel: 787 831-2577 Fax: 787 805-7350 Email: gloriae55amg@yahoo.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Ovidio Jose Garcia Amador, president. A list of the Debtor's three largest unsecured creditors is available for free at http://bankrupt.com/misc/prb14-03214.pdf INT'L ENVIRONMENTAL: 2nd Stipulation With EH National Bank OK'd --------------------------------------------------------------- The Hon. Wayne Johnson of the U.S. Bankruptcy Court for the Central District of California has approved the second stipulation between Howard B. Grobstein, Chapter 11 trustee for International Environmental Solutions Corporation, and EH National Bank relating to the outstanding amount due under a previously approved stipulation. As reported by the Troubled Company Reporter on Feb. 19, 2014, the first stipulation approved by the Court on Sept. 7, 2012, resolved the Bank's claims, prevented the Bank from seeking relief from stay and foreclosing on all of the estate's assets, and allowed the trustee to enter into a transaction that would provide a stream of royalty payments to the estate. The First Stipulation, among other things, required the Debtor to repay the Bank in full for all debt owed by the Debtor to the Bank on or before Dec. 31, 2013. As of June 30, 2012, the Debtor owed the Bank $2,350,980. The First Stipulation required the Debtor to pay the Bank certain portions of the proceeds of the sales of each of several assets, specifically three machines known as the 8TPD, the 40TPD, and the 125TPD. Under the First Stipulation, the estate was entitled to keep the first $50,000 from the sale of the three machines and the Bank was entitled to the balance of the proceeds up to the indebtedness. On Aug. 6, 2013, the 125TPD was sold for $30,000, which funds were used primarily to pay annuities necessary to maintain the validity of the Debtor's patents. On Dec. 23, 2013, the 8TPD was sold for $105,000. The Chapter 11 Trustee says in a Jan. 30, 2014 court filing that he needs funds in the estate to pay patent annuities that continue to come due on an ongoing basis. The Chapter 11 Trustee and the Bank have agreed that the estate will pay the Bank $50,000 from the sale of the 8TPD upon entry of an order approving the motion. The Bank has agreed to extend the maturity date of the indebtedness by six months to June 30, 2014. The Second Stipulation, according to the Chapter 11 Trustee, gives the estate more time to repay the Bank and avoids litigation with the Bank. It further allows the estate to retain sufficient funds to pay other costs of administration while providing for completion payments to the Bank, the Chapter 11 Trustee states. About International Environmental Solutions Karen Bertram, James Hinkle, Blaine Scott Molle & Dennis Molle, and Linda Babb filed an involuntary Chapter 11 petition against International Environmental Solutions Corporation, dba IES Corporation (Bankr. C.D. Calif. Case No. 12-16268) on March 13, 2012. IES consented to the entry of an order for relief under Chapter 11 on May 10, 2012. Judge Wayne E. Johnson presides over the case. The Debtor hired Goe & Forsythe, LLP, as counsel. The Debtor disclosed $25,129,244 in assets and $10,387,254 in liabilities. At the behest of a shareholder, the U.S. Trustee appointed Howard Grobstein as Chapter 11 trustee for the Debtor's estate. Marshack Hays as his general counsel Crowe Horwath LLP as his accountants Dzida, Carey & Steinman as his special transactional counsel. Stetina Brunda Garred & Brucker as his special patent and trademark counsel. INTERNATIONAL TEXTILE: Incurs $10.9 Million Net Loss in 2013 ------------------------------------------------------------ International Textile Group, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss attributable to common stock of the Company of $10.91 million on $624.21 million of net sales for the year ended Dec. 31, 2013, as compared with a net loss attributable to common stock of the Company of $91.45 million on $619.07 million of net sales during the prior year. As of Dec. 31, 2013, the Company had $317.32 million in total assets, $404.86 million in total liabilities and a $87.53 million total stockholders' deficit. A copy of the Form 10-K is available for free at: http://is.gd/AiHDSQ About International Textile International Textile Group, Inc., is a global, diversified textile manufacturer headquartered in Greensboro, North Carolina, with current operations principally in the United States, China, Mexico, and Vietnam. ITG's long-term focus includes the realization of the benefits of its global expansion, including reaching full production at ITG facilities in China and Vietnam, and continuing to seek other strategic growth opportunities. ISC8 INC: Hires Griffin Partners as Restructuring Consultant ------------------------------------------------------------ ISC8 Inc. entered into an engagement agreement with Griffin Partners, LLC, wherein Griffin will offer certain advisory and consulting services to the Company pertaining to the Company's current capital restructuring. Griffin is affiliated with the Griffin Find, LP, a principal shareholder of the Company. The Engagement Agreement was reviewed and approved by the Company's Board of Directors. As compensation for Griffin's services, the Company agreed to pay Griffin an aggregate total of $100,000, to be paid periodically in order to enable the Company to effectively manage its ongoing cash requirements. In connection with the offering of senior subordinated secured convertible promissory notes, the Company entered into additional Note Purchase Agreements with certain accredited investors, resulting in the issuance of Notes in the aggregate principal amount of $933,333. To date, the Company has entered into Purchase Agreements, and issued Notes, in the aggregate principal amount of approximately $1.98 million. Per the terms of the Purchase Agreements, the Notes were issued with an original issue discount of 25 percent. The Notes accrue interest at a rate of 12 percent per annum and mature on July 31, 2014. Additionally, in the event the Company consummates a debt or equity financing resulting in gross proceeds of at least $4 million, the then outstanding principal balance of the Notes, plus all accrued but unpaid interest, will convert into the securities issued in connection with the Qualified Financing. About ISC8 Inc. Costa Mesa, California-based ISC8 Inc. is engaged in the design, development, manufacture and sale of a family of security products, consisting of cyber security solutions for commercial and U.S. government applications, secure memory products, some of which utilize technologies that the Company has pioneered for three-dimensional ("3-D") stacking of semiconductors, systems in a package ("Systems in a Package" or "SIP"), and anti-tamper systems. The Company reported a net loss of $28.02 million on $501,000 of revenues in fiscal year ended Sept. 30, 2013, compared with a net loss of $19.7 million in fiscal year ended Sept 30, 2012. Squar, Milner, Peterson, Miranda & Williamson, LLP, in their audit report on the consolidated financial statements for the year ended Sept. 30, 2013, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has negative working capital of $29.7 million and a stockholders' deficit of $55.5 million. As of Dec. 31, 2013, the Company had $3.81 million in total assets, $10.22 million in total liabilities and a $6.41 million total stockholders' deficit. JAMES RIVER: BNP Paribas Stake at 5.8% as of Dec. 31 ---------------------------------------------------- In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission, BNP Paribas Arbitrage, SNC, and BNP Paribas Securities Corp. disclosed that as of Dec. 31, 2013, they beneficially owned 2,084,724 shares of common stock of James River Coal Co. representing 5.8 percent of the shares outstanding. A copy of the regulatory filing is available for free at: http://is.gd/3XP9iR About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. For the nine months ended Sept. 30, 2013, the Company reported a net loss of $14.99 million. James River reported a net loss of $138.90 million in 2012, as compared with a net loss of $39.08 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.06 billion in total assets, $818.69 million in total liabilities and $247.34 million in total shareholders' equity. * * * In the May 24, 2013, edition of the TCR, Moody's Investors Service downgraded James River Coal Company's Corporate Family Rating to Caa2 from Caa1. "While the company continues to take actions to reposition operations and shore up its balance sheet, we expect external factors will preclude James River from maintaining credit measures and liquidity consistent with the Caa1 rating level," said Ben Nelson, Moody's lead analyst for James River Coal Company. As reported by the TCR on Nov. 19, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Richmond, Va.-based James River Coal Co. to 'CCC' from 'SD' (selective default). "We raised our rating on James River Coal because we understand that the company has stopped repurchasing its debt at deep discounts, for the time being," said credit analyst Megan Johnston. LARSEN ROAD: Seeks to Employ Leverson & Metz as Attorneys --------------------------------------------------------- Larsen Road Green Bay seeks authority from the U.S. Bankruptcy Court for the Eastern District of Wisconsin to employ Leverson & Metz S.C. as attorneys. L&M has estimated that the cost of its services in this case will be in the following ranges: Case administration $2,000 to $4,000 Preparation of schedules and statements $3,000 to $5,000 Cash collateral and automatic stay matters $8,000 to $18,000 General communications with creditors $4,000 to $6,000 Communications with client $7,000 to $12,000 Negotiating and drafting a plan and disclosure statement $18,000 to $30,000 Miscellaneous $2,000 to $5,000 The Debtor wishes to employ these attorneys on a general retainer. It is anticipated that most of the services will be performed by Mark L. Metz, Esq., and Olivier H. Reiher, Esq., whose respective standard hourly rates of $360 and $225 have been in effect since January 1, 2014. The firm assures the Court that it is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Larsen Road Green Bay filed a bare-bones Chapter 11 petition (Bankr. E.D. Wisc. Case No. 14-24324) in Milwaukee on April 14, 2014. The Debtor estimated $10 million to $50 million in assets and liabilities. The Debtor is represented by Mark L. Metz, Esq., at Leverson & Metz, S.C., in Milwaukee. The petition was signed by Peter Jungbacker as president of general manager. LATTICE INC: Rosenberg Raises Going Concern Doubt ------------------------------------------------- Lattice Inc. had a net loss of $1 million on $8.27 million of revenues in 2013, according to the Company's Form 10-K filing with the U.S. Securities and Exchange Commission. Lattice disclosed a net loss of $570,772 on $10.77 million of revenue for the year ended Dec. 31, 2012, following a net loss of $6.06 million on $11.44 million of revenue for the year ended Dec. 31, 2011. Rosenberg Rich Baker Berman & Company expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has a history of operating losses, has a working capital deficit, and requires additional working capital to meet its current liabilities. The Company's balance sheet at Dec. 31, 2013, showed $4.76 million in total assets, $7.23 million in total liabilities, and a stockholders' deficit of $2.47 million. A copy of the Form 10-K is available at: http://is.gd/2PmAYi About Lattice Inc. Pennsauken, New Jersey-based Lattice Incorporated provides telecommunications services to correctional facilities and specialized telecommunication service providers in the United States. LDK SOLAR: Seeks Review of NYSE's Trading Suspension Decision ------------------------------------------------------------- LDK Solar Co., Ltd., in provisional liquidation, and its Joint Provisional Liquidators, Tammy Fu and Eleanor Fisher, both of Zolfo Cooper (Cayman) Limited, has requested a review of the decision made on March 31, 2014, by the staff of NYSE Regulation, Inc., to suspend trading of the Company's American depositary shares on the New York Stock Exchange and to commence delisting proceedings. A date will now be set for a hearing before a Committee of the Board of Directors of NYSE Regulation. In its hearing request, LDK Solar made several arguments why LDK Solar should remain listed, including that a listing decision should not be made until LDK Solar completes its on-going restructuring efforts. LDK Solar will provide a further update following receipt of the Committee's final decision, which is expected within the next 60- 120 days. The Company's ADSs are currently trading on the OTCQB market under the symbol "LDKSY" while trading is suspended on the NYSE. No action will be taken by NYSE Regulation to delist the Company's securities from the NYSE pending the outcome of the hearing, while trading on the NYSE will remain suspended until the Committee issues its decision. About LDK Solar LDK Solar Co., Ltd. -- http://www.ldksolar.com-- based in Hi- Tech Industrial Park, Xinyu City, Jiangxi Province, People's Republic of China, is a vertically integrated manufacturer of photovoltaic products, including high-quality and low-cost polysilicon, solar wafers, cells, modules, systems, power projects and solutions. LDK Solar was incorporated in the Cayman Islands on May 1, 2006, by LDK New Energy, a British Virgin Islands company wholly owned by Xiaofeng Peng, LDK's founder, chairman and chief executive officer, to acquire all of the equity interests in Jiangxi LDK Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin Industrial Limited. LDK Solar Co disclosed a net loss of $1.05 billion on $862.88 million of net sales for the year ended Dec. 31, 2012, as compared with a net loss of $608.95 million on $2.15 billion of net sales for the year ended Dec. 31, 2011. KPMG, in Hong Kong, China, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Group has a net working capital deficit and a deficit in total equity as of Dec. 31, 2012, and is restricted from incurring additional indebtedness as it has not met a financial covenant ratio as defined in the indenture governing the RMB-denominated US$-settled senior notes. These conditions raise substantial doubt about the Group's ability to continue as a going concern. LEARNING CARE: S&P Affirms 'B' CCR & Rates $370MM Facility 'B' -------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Novi, Michigan-based childcare service provider Learning Care Group (US) No. 2 Inc. The outlook is stable. At the same time, S&P assigned Learning Care Group's $370 million senior secured credit facility an issue-level rating of 'B' (at the same level as the 'B' corporate credit rating on the company), with a recovery rating of '3', indicating S&P's expectation for meaningful (50% to 70%) recovery for lenders in the event of a payment default. The credit facility consists of a $320 million term loan due 2021 and $50 million revolving credit facility due 2019. The company will use proceeds to help fund American Securities LLC's leveraged acquisition of the company, and to repay higher- cost existing debt and preferred stock. The 'B' corporate credit rating on Learning Care Group reflects S&P's assessment of the business risk profile as "weak" and the financial risk profile as "highly leveraged." The company's "weak" business risk profile reflects S&P's assessment of its highly cyclical operating performance; sensitivity of capacity utilization rates to unemployment levels; dependence on state and local federal subsidized programs, which are vulnerable to budget constraints; and its less favorable business composition and lower EBITDA margin relative to employer- sponsored, workplace-based peers. Learning Care Group is the second largest U.S. child care center operator, in a highly fragmented business. Its market share is small, at about 2%, though its margins are slightly greater than the leading retail-based center competitor. Learning Care Group has a broad geographical network, though the highly competitive Texas market accounts for roughly 15% of revenues. Roughly 24% of revenues are derived from state and federally subsidized programs, which are sensitive to budget constraints. The company operates five distinct brands, with the La Petite Academy childcare brand accounting for nearly half of the total centers and having the highest dependence on government programs. The company's centers are retail-based, which tend to be cyclical, exhibiting highly variable revenue and EBITDA over the economic cycle. In addition, revenue visibility is limited, as clients pay a tuition fee one week in advance, without any commitment. S&P sees the risk that a reversal of the current improving trend in U.S. unemployment, which S&P do not expect, together with the fixed cost structure of the business, could undermine revenue and earnings. LUZ ACADEMY TUCSON: Case Summary & 20 Top Unsecured Creditors ------------------------------------------------------------- Debtor affiliates that filed for Chapter 11 bankruptcy petitions: Debtor Case No. ------ -------- Luz Academy of Tucson, Inc. 14-05944 2797 N Cerrada De Beto Tucson, AZ 85745 Luz Social Services, Inc. 14-05950 2797 N Cerrada De Beto Tucson, AZ 85745 El Centro for the Study of Primary 14-05954 and Secondary Education 2797 N Cerrada De Beto Tucson, AZ 85745 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Arizona (Tucson) Judge: Hon. Brenda Moody Whinery (14-05944) Hon. Eileen W. Hollowell (14-05950 and 14-05954) Debtors' Counsel: Eric Slocum Sparks, Esq. ERIC SLOCUM SPARKS PC 110 S Church Ave #2270 Tucson, AZ 85701 Tel: 520-623-8330 Fax: 520-623-9157 Email: law@ericslocumsparkspc.com Total Total Assets Liabilities ----------- ----------- Luz Academy of Tucson, Inc. $137,194 $3.22MM Luz Social Services, Inc. $7.6MM $2.88MM El Centro for the Study $341,722 $2.84MM The petitions were signed by Barbara W. Cisneros, secretary. A list of Luz Academy of Tucson, Inc.'s 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/azb14-05944.pdf A list of Luz Social Services, Inc.'s 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/azb14-05950.pdf A list of the El Centro for the Study of Primary's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/azb14-05954.pdf MASON COPPELL: Hires Munsch Hardt as Attorneys ---------------------------------------------- Mason Coppell OP, LLC, dba Sandy Lake, and its debtor-affiliates, except for Mason Georgetown RealCo, LLC, seek authorization from the Hon. Stacey G.C. Jernigan of the U.S. Bankruptcy Court for the Northern District of Texas to employ Munsch Hardt Kopf & Harr, P.C. as attorneys, effective Mar. 18, 2014. The Debtors require Munsch Hardt to: (a) assist the Operating Debtors in carrying out their duties, rights and obligations under the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"); (b) consult with and advise the Operating Debtors with respect to the management and operation of the Operating Debtors' businesses; (c) advise the Operating Debtors of their responsibilities to the unsecured creditor body and to direct necessary communications with same, including attendance at meetings and negotiations with representatives of creditors, their counsel, and other parties-in-interest; (d) assist the Operating Debtors in obtaining use of cash collateral and debtor-in-possession financing and other negotiations with secured creditors; (e) consult with the United States Trustee, any statutory committee that may be formed, and all other creditors and parties-in-interest concerning the administration of the Bankruptcy Cases; (f) assist the Operating Debtors in analyzing and appropriately treating the claims of creditors; (g) take all necessary action to protect and preserve the assets of the Operating Debtors' Estates, including the prosecution of actions on behalf of the Operating Debtors, the defense of any actions commenced against the Operating Debtors, negotiations concerning all litigation in which the Operating Debtors are a party or hereafter are a party, and objections to claims filed against the Estates; (h) prepare on behalf of the Operating Debtors all motions, applications, answers, orders, reports, and other legal papers and documents necessary to the administration of the Estates; (i) prepare on the Operating Debtors' behalf a plan and accompanying disclosure statement, any amendments to the plan or disclosure statement, any related agreements and documents, and take any necessary action on behalf of the Operating Debtors to obtain confirmation of the Plan; (j) advise the Operating Debtors in connection with any potential sales of assets; (k) appear before the Court and any state courts and appellate courts, as necessary, on behalf of the Operating Debtors to protect the interests of the Estates and the Operating Debtors before such courts; and (l) perform all other legal services and providing all other legal advice to the Operating Debtors in connection with the Bankruptcy Cases as may be required or necessary. Munsch Hardt will be paid at these hourly rates: Shareholder/Partner $335-$720 Associate $235-$375 Paralegals $165-$265 Munsch Hardt will also be reimbursed for reasonable out-of-pocket expenses incurred. Joe E. Marshall, Esq., shareholder of Munsch Hardt, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. The Court for the Northern District of Texas will hold a hearing on the application on May 1, 2014, at 9:30 a.m. Munsch Hardt can be reached at: Joe E. Marshall, Esq. MUNSCH HARDT KOPF & HARR, P.C. 500 N. Akard Street, Suite 3800 Dallas, TX 75201-6659 Tel: (214) 855-7500 Fax: (214) 978-4365 E-mail: jmarshall@munsch.com About Mason Coppell Mason Coppell OP, LLC, Mason Georgetown OP, LLC, Mason Mesquite OP, LLC, and Mason Round Rock OP, LLC operate five skilled nursing homes in Texas. Mason Georgetown RealCo, LLC, owns the real estate and building for the operations of Mason Georgetown. They initiated the Chapter 11 cases to effectuate a prompt transfer of their assets and operations to preserve patient safety and any potential value for creditors. Mason Coppell OP, LLC, et al., filed Chapter 11 bankruptcy petitions (Bankr. N.D. Tex. Case Nos. 14-31327 to 14-14-31334) on March 18, 2014. Judge Stacey Jernigan presides over the cases. The Debtors estimated assets of at least $10 million and debts of at least $10 million. The Debtors, except Mason Georgetown Realco, are represented by Joe E. Marshall, Esq., Thomas D. Berghman, Esq., and Timothy A. Million, Esq., at Munsch Hardt Kopf & Harr, P.C. Georgetown Realco is represented by Jonathan S. Covin, Esq., and Shayla L. Friesen, Esq., at Wick Phillips Gould & Martin, LLP. Deloitte Transactions and Business Analytics, LLP, acts as the Debtors' restructuring advisor with Louis Robichaux serving as chief restructuring officer. On March 28, 2014, the United States Trustee appointed an Unsecured Creditors' Committee in the cases. To date there has been no request made for the appointment of a trustee or examiner. A patient care ombudsman has not yet been appointed. However, the Court has scheduled a show cause hearing on April 15 to consider the appointment of an Ombudsman. Counsel for the Committee is Cox Smith Mathews Incorporated's Mark Andrews, Esq. Counsel for Oxford is Vedder Price P.C.'s Jon Aberman, Esq. Counsel for THI of Baltimore, Inc., the stalking horse bidder for the Debtors' assets, is Arent Fox LLP's George P. Angelich, Esq. MASON COPPELL: Affiliate Taps Wick Phillips as Counsel ------------------------------------------------------ Mason Georgetown RealCo, LLC, an affiliate of Mason Coppell OP, LLC, asks for authorization from the Hon. Stacey G.C. Jernigan of the U.S. Bankruptcy Court for the Northern District of Texas to employ Wick Phillips Gould & Martin, LLP as counsel, effective Mar. 18, 2014 petition date. Georgetown RealCo requires Wick Phillips to: (a) advise the Debtor with respect to its powers, rights, and duties as a Chapter 11 debtor; (b) advise the Debtor with respect to the rights and remedies of the Estate's creditors and other parties in interest; (c) advise the Debtor with its responsibilities to the unsecured creditor body and to direct necessary communications with same, including attendance at meetings and negotiations with representatives of creditors, their counsel, and other parties-in-interest; (d) assist the Debtor in obtaining use of cash collateral and debtor-in-possession financing and other negotiations with secured creditors; (e) consult with the U.S. Trustee, any statutory committee that may be formed, and all other creditors and parties-in- interest concerning the administration of the Debtor's chapter 11 case; (f) conduct appropriate examinations of witnesses, claimants, and other parties in interest; (g) prepare all appropriate documents, pleadings, and other legal instruments required to be filed in this matter; (h) represent the Debtor in all proceedings before the Bankruptcy Court and in any other judicial or administrative proceedings in which the rights of the Debtor or its Estate may be affected; (i) advise the Debtor in connection with the formulation, solicitation, confirmation, and consummation of any plan or plan of reorganization which the Debtor may propose; (j) advise the Debtor in connection with any potential sale of assets; and (k) performing any other legal services which may be appropriate in connection with the continued operation of the Debtor's business in bankruptcy. Wick Phillips will be paid at these hourly rates: Partners $375-$620 Of Counsel $355-$395 Associates/Staff Attorneys $250-$395 Paralegals/Legal Assistants $120-$140 Wick Phillips will also be reimbursed for reasonable out-of-pocket expenses incurred. Following payment for services rendered to and reimbursable expenses incurred on behalf of the Debtor prior to the Petition Date, Wick Phillips holds a retainer with a remaining balance of $17,278.50. Jonathan S. Covin, Esq., a partner of Wick Phillips, 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. Wick Phillips can be reached at: Jonathan S. Covin, Esq. WICK PHILLIPS GOULD & MARTIN, LLP 2100 Ross Avenue, Suite 950 Dallas, TX 75201 Tel: (214) 692-6200 Fax: (214) 692-6255 About Mason Coppell Mason Coppell OP, LLC, Mason Georgetown OP, LLC, Mason Mesquite OP, LLC, and Mason Round Rock OP, LLC operate five skilled nursing homes in Texas. Mason Georgetown RealCo, LLC, owns the real estate and building for the operations of Mason Georgetown. They initiated the Chapter 11 cases to effectuate a prompt transfer of their assets and operations to preserve patient safety and any potential value for creditors. Mason Coppell OP, LLC, et al., filed Chapter 11 bankruptcy petitions (Bankr. N.D. Tex. Case Nos. 14-31327 to 14-14-31334) on March 18, 2014. Judge Stacey Jernigan presides over the cases. The Debtors estimated assets of at least $10 million and debts of at least $10 million. The Debtors, except Mason Georgetown Realco, are represented by Joe E. Marshall, Esq., Thomas D. Berghman, Esq., and Timothy A. Million, Esq., at Munsch Hardt Kopf & Harr, P.C. Georgetown Realco is represented by Jonathan S. Covin, Esq., and Shayla L. Friesen, Esq., at Wick Phillips Gould & Martin, LLP. Deloitte Transactions and Business Analytics, LLP, acts as the Debtors' restructuring advisor with Louis Robichaux serving as chief restructuring officer. On March 28, 2014, the United States Trustee appointed an Unsecured Creditors' Committee in the cases. To date there has been no request made for the appointment of a trustee or examiner. A patient care ombudsman has not yet been appointed. However, the Court has scheduled a show cause hearing on April 15 to consider the appointment of an Ombudsman. Counsel for the Committee is Cox Smith Mathews Incorporated's Mark Andrews, Esq. Counsel for Oxford is Vedder Price P.C.'s Jon Aberman, Esq. Counsel for THI of Baltimore, Inc., the stalking horse bidder for the Debtors' assets, is Arent Fox LLP's George P. Angelich, Esq. MERRIMAN HOLDINGS: Marcum LLP Raises Going Concern Doubt -------------------------------------------------------- Merriman Holdings, Inc., had a net loss of $3.99 million on $9.96 million of revenues in 2013, compared with a net loss of $6.87 million on $12.9 million of revenues in 2012, according to the Form 10-K filed for the year ended Dec. 31, 2013. Marcum, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has recurring losses, negative cash flows from operations, and an accumulated deficit as of Dec. 31, 2013, and 2012. The Company's balance sheet at Dec. 31, 2013, showed $5.43 million in total assets, $5.58 million in total liabilities, and a stockholders' deficit of $147,000. A copy of the Form 10-K is available at: http://is.gd/oq81HW San Francisco, California-based Merriman Holdings, Inc., is a financial services holding company that provides capital markets services, corporate services, and investment banking through its wholly-owned operating subsidiary, Merriman Capital, Inc. MC is an investment bank and securities broker-dealer focused on fast growing companies and institutional investors. MOBILE MINI: Moody's Affirms B1 CFR & B2 Senior Unsecured Rating ---------------------------------------------------------------- Moody's Investors Service affirmed the B1 corporate family and B2 senior unsecured ratings of Mobile Mini, Inc. and revised the rating outlook to positive. Ratings Rationale Mobile Mini's ratings are based on the company's strong market position in the portable storage leasing industry in the U.S. and the U.K., the long-term cash flow generating capacity from its investment in long-lived mobile storage units, and its modest near-term liquidity risks. Credit constraints include the firm's limited alternate liquidity sources, reliance on secured funding, and its concentrated exposure to the construction and retail sectors. Moody's revised Mobile Mini's rating outlook to positive to reflect the firm's improved financial performance and reduced leverage, which is likely to be sustained over the intermediate term. Mobile Mini's financial performance has steadily improved in recent quarters, reflecting higher trending lease yields and utilization, partially offset by higher operating expenses. Mobile Mini's pre-tax return on average managed assets in 2013 measured 4.5%, excluding a $38.7 million impairment charge for non-core equipment, representing recovery from a low of 1.2% in 2010, though still below the pre-recession average of 7.5%. Utilization improved in 2013 to 65.8% after dipping to a low of 53.4% in 2010. Rental rate increases introduced by the company in 2013 have proven resilient, resulting in higher trending yields. Moody's expects that Mobile Mini's low operating leverage and continued prospects for improved utilization and lease yields position the company for sustained margin and cash flow improvement. Mobile Mini has used its strengthened free cash flow to repay debt, significantly reducing leverage. Loans outstanding under the firm's asset-based loan facility at December 31, 2013, totaled $319 million, down by nearly half from $605 million at the closing of its mid-2008 merger with Mobile Storage Group. As a result of the debt repayments and strengthened earnings, Debt to EBITDA improved to 3.7x (excluding impairment expense), versus a high of 7.7x at year-end 2008. Debt to Tangible Equity declined to 1.5x at year end, versus 2.2x at year-end 2012. Moody's expects that Mobile Mini will continue to prudently manage leverage going forward. Mobile Mini has satisfactory liquidity, considering the absence of near-term debt maturities, strong cash flow and modest capital expenditure requirements. However, Mobile Mini's funding profile lacks diversity, due to its reliance on its $900 million ABL facility, which matures in June 2017. While the company had ample borrowing availability of $573.3 million at year end 2013, the facility encumbers the firm's earning assets, which reduces financial and operational flexibility. An additional rating constraint concerns Mobile Mini's concentrations in the construction and retail sectors. At year end 2013, retail and construction each comprised 36% of Mobile Mini's customer base. The high cyclicality of these sectors contributed to Mobile Mini's asset utilization and earnings weakness during the recession and represents a continuing source of performance risk. Mobile Mini's ratings could be upgraded if, on a sustainable basis, Debt to EBITDA further improves to 3.5x, tangible common equity to tangible managed assets remains above 25%, and pre-tax return on average managed assets continues to trend toward pre- recession levels. Ratings could be downgraded if profitability unexpectedly weakens or leverage increases. Mobile Mini, Inc. is a Tempe, Arizona based provider of portable storage solutions. MOMENTIVE PERFORMANCE: Final DIP Hearing on May 15 -------------------------------------------------- Bankruptcy Judge Robert D. Drain on April 14 issued an interim order authorizing Momentive Performance Materials Holdings Inc. and its affiliated debtors to access up to $430 million of the $570 million in debtor-in-possession financing led by J.P. Morgan Securities LLC as lead arranger. A summary of the DIP facilities was reported in the April 17 edition of the Troubled Company Reporter. The DIP credit facilities -- consisting of a $270 million asset-based revolving facility ("DIP ABL Facility") and a $200 million term loan facility -- will provide the necessary liquidity to fund, in combination with the use of cash collateral, the Debtors' operating, working capital and capital expenditure needs during the course of the chapter 11 cases. The Debtors sought immediate access to up to $130 million of the DIP ABL Facility and the entire $300 million of the DIP Term Loan Facility on an interim basis, which will be used to repay the Prepetition ABL Facility in full and provide for the Debtors' immediate liquidity needs. The Debtors were given interim authority to tap up to an aggregate amount of $450 million in debtor in possession financing over the objection from first-lien lenders who complained that the DIP loan comes ahead of their debt and asked the Court to approve only enough to continue operations until the final DIP hearing. The Interim DIP Loan approved by the Court is composed of $130 million from an asset-based revolving facility and $300 million from a term loan facility. The Debtors also obtained interim authority to use the cash collateral securing their prepetition indebtedness. A Final DIP Hearing is set for May 15, 2014 at 9:30 a.m., prevailing Eastern time. Objections are due May 8 at 12:00 p.m. On April 14, the Company issued a news release announcing that the Court provided interim authorization of the DIP ABL Facility and the DIP Term Loan Facility. 1. Amended and Restated Senior Secured Debtor-in- Possession and Exit Asset-Based Revolving Credit Agreement On April 15, 2014, Holdings, the Company, Momentive Performance Materials USA Inc. ("MPM USA"), as U.S. borrower, Momentive Performance Materials GmbH ("MPM GmbH") and Momentive Performance Materials Quartz GmbH ("MPM GmbH Quartz"), as German borrowers, Momentive Performance Materials Nova Scotia ULC, as Canadian borrower, the lenders party thereto, JPMorgan Chase Bank, N.A. ("JPMorgan"), as administrative agent, and JPMorgan, as collateral agent entered into an amended and restated senior secured debtor- in-possession and exit asset-based revolving credit agreement, which amends and restates the asset-based revolving credit agreement among Holdings, the Company, the Borrowers, the lenders party thereto, JPMorgan, as administrative agent, and JPMorgan, as collateral agent. The DIP ABL Facility is currently being syndicated and certain terms, including pricing, are subject to change. The DIP ABL Facility has a 12-month term unless, prior to the end of such 12 month period, the Plan is confirmed pursuant to an order entered by the Bankruptcy Court, in which case, the DIP ABL Facility will terminate on the date of such confirmation, unless the Company exercises its option to convert the DIP ABL Facility into an exit facility, in which case, upon the effectiveness of the exit facility, the term will be five years after such effective date. Availability under the ABL Facility is $270 million, which is limited prior to the date that the Court issues a final order approving the DIP ABL Facility. The DIP ABL Facility is also subject to a borrowing base that is based on a specified percentage of eligible accounts receivable and inventory and, in certain foreign jurisdictions, machinery and equipment. The DIP ABL Facility bears interest based on, at the Company's option, an adjusted LIBOR rate plus an applicable margin of 2.75% or an alternate base rate plus an applicable margin of 1.75%. In addition to paying interest on outstanding principal under the DIP ABL Facility, the Company will be required to pay a commitment fee to the lenders in respect of the unutilized commitments at an initial rate equal to 0.375% per annum, subject to adjustment depending on the usage. The DIP ABL Facility has a minimum EBITDA covenant calculated on a cumulative basis beginning with May 1, 2014 and tested monthly as of August 31, 2014 and a minimum liquidity covenant of $50 million tested at the close of each business day. The facility provides that the EBITDA for the most recently ended Exit Test Period of Intermediate Holdings shall be no less than $230 million. The Exit Facility does not have any financial maintenance covenants, other than a minimum fixed charge coverage ratio of 1.0 to 1.0 that would only apply if availability is less than the greater of (a) 12.5% of the lesser of the borrowing base and the total DIP ABL Facility commitments at such time and (b) $27 million. The fixed charge coverage ratio under the agreement governing the DIP ABL Facility is defined as the ratio of (a) Adjusted EBITDA minus non-financed capital expenditures and cash taxes to (b) debt service plus cash interest expense plus certain restricted payments, each measured on a last twelve months basis. The DIP ABL Facility is secured by, among other things, first- priority liens on most of the inventory and accounts receivable and related assets of the Company, its domestic subsidiaries and certain of its foreign subsidiaries, and, in the case of certain foreign subsidiaries, machinery and equipment (the "DIP ABL Priority Collateral"), and second-priority liens on certain collateral that generally includes most of the Company's, its domestic subsidiaries' and certain of its foreign subsidiaries' assets other than DIP ABL Priority Collateral (the "DIP Term Loan Priority Collateral"), in each case subject to certain exceptions and permitted liens. 2. Reaffirmation Agreement In connection with the DIP ABL Facility, on April 15, the Company entered into a reaffirmation agreement among Holdings, the Company, the Borrowers, the other domestic subsidiaries of the Company party thereto, certain foreign subsidiaries of the Company party thereto and the DIP ABL Collateral Agent, pursuant to which the parties thereto reaffirmed that the guarantees and security interests that secured the Prepetition ABL Facility remain in place and guarantee and secure the DIP ABL Facility for the benefit of the secured parties under the DIP ABL Facility. 3. Senior Secured Debtor-in-Possession Term Loan Agreement On April 15, the Company entered into a senior secured debtor-in- possession term loan agreement among Holdings, the Company, MPM USA, the lenders party thereto, JPMorgan, as administrative agent, and JPMorgan, as collateral agent. The DIP Term Loan Facility was used in part to repay in full the outstanding obligations under the Prepetition ABL Facility. The DIP Term Loan Facility is currently being syndicated and certain terms, including pricing, are subject to change. The DIP Term Loan Facility has a 12-month term, unless prior to the end of such 12 month period, the Plan is confirmed pursuant to an order entered by the Bankruptcy Court, in which case, the DIP Term Loan Facility will terminate on the date of such confirmation. The amount committed and made available under the DIP Term Loan Facility is $300 million. The DIP Term Loan Facility bears interest based on, at the Company's option, an adjusted LIBOR rate plus an applicable margin of 4.00% or an alternate base rate plus an applicable margin of 3.00%. The DIP Term Loan Facility has a minimum EBITDA covenant calculated on a cumulative basis beginning with May 1, 2014 and tested monthly as of August 31, 2014 and a minimum liquidity covenant of $50 million tested at the close of each business day. Specifically, the Debtors agree not to permit cumulative EBITDA of Momentive Performance Materials Inc., for the relevant time periods below to be less than the levels shown below for such relevant time periods, on a cumulative basis beginning with May 1, 2014 , to be tested monthly on the last day of each month commencing as of the last day of August 31, 2014: Minimum consolidated Test Period EBITDA ----------- -------------------- May 1, 2014 ? August 31, 2014 $62.4 million May 1, 2014 ? September 30, 2014 $80.9 million May 1, 2014 ? October 31, 2014 $95.2 million May 1, 2014 ? November 30, 2014 $111.2 million May 1, 2014 ? December 31, 2014 $126.3 million May 1, 2014 ? January 31, 2014 $140.1 million May 1, 2014 ? February 28, 2015 $156.9 million May 1, 2014 ? March 31, 2015 $174.6 million May 1, 2014 ? April 30, 2015 $189.6 million The security arrangements for the DIP Term Loan Facility include first-priority liens on the DIP Term Loan Priority Collateral owned by the Company and its domestic subsidiaries and second- priority liens on the DIP ABL Priority Collateral owned by the Company and its domestic subsidiaries, which are junior to the DIP ABL Facility, in each case subject to certain exceptions and permitted liens. 4. Collateral Agreement In connection with the DIP Term Loan Facility, on April 15, the Company entered into a collateral agreement among Holdings, the Company, MPM USA, the other domestic subsidiaries of the Company party thereto and the DIP Term Loan Collateral Agent, pursuant to which the DIP Term Loan Obligors granted a security interest in certain collateral to the DIP Term Loan Collateral Agent for the benefit of the secured parties under the DIP Term Loan Facility. 5. Guarantee Agreement In connection with the DIP Term Loan Facility, on April 15, the Company entered into a guarantee agreement among the DIP Term Loan Obligors and the DIP Term Loan Collateral Agent, pursuant to which the DIP Term Loan Obligors guaranteed the obligations of the Borrower under the DIP Term Loan Credit Agreement and the other loan documents and the other DIP Term Loan Guarantors under the loan documents. 6. DIP Financing Intercreditor Agreement In connection with the DIP ABL Facility and the DIP Term Loan Facility, on April 15, the Company entered into a DIP financing intercreditor agreement among Holdings, the Company, the Borrowers, the other subsidiaries of the Company party thereto, the DIP ABL Collateral Agent and the DIP Term Loan Collateral Agent. The DIP Intercreditor Agreement governs the relative rights of the DIP ABL Secured Parties and the DIP Term Loan Secured Parties, and certain other matters relating to priority and the administration and enforcement of security interests. Objections to Final DIP Order Any party-in-interest objecting to the final approval of the DIP financing must serve and file written objections to the Court and these entities: (a) Willkie Farr & Gallagher LLP 787 Seventh Avenue New York, NY 10019 Attention: Matthew A. Feldman, Esq. Paul V. Shalhoub, Esq. Attorneys for the Debtors (b) SIMPSON THACHER & BARTLETT LLP 425 Lexington Avenue New York, NY 10017 Attention: Steven Fuhrman, Esq. Kathrine A. McLendon, Esq. Nicholas Baker, Esq. Attorneys for the DIP Agents and the Cash Flow Agents (c) SIMPSON THACHER & BARTLETT LLP 425 Lexington Avenue New York, NY 10017 Attention: Peter Pantaleo, Esq. Attorneys for the Prepetition ABL Agent (d) EMMET, MARVIN & MARTIN, LLP 120 Broadway, 32nd Floor New York, NY 10271 Attention: Edward P. Zujkowski, Esq. - and - DECHERT LLP 1095 Avenue of the Americas New York, NY 10036 Attention: Michael J. Sage, Esq. Attorneys for the First Lien Indenture Trustee (e) ROPES & GRAY LLP 1211 Avenue of the Americas New York, NY 10036 Attention: Mark R. Somerstein Attorneys for the 1.5 Lien Indenture Trustee (f) Attorneys for the Second Lien Indenture Trustee; (g) counsel to any Committee (h) AKIN GUMP STRAUSS HAUER & FELD LLP One Bryant Park New York, NY 10036 Attention: Ira S. Dizengoff, Esq. Philip C. Dublin Attorneys for Apollo (i) MILBANK, TWEED, HADLEY & MCCLOY LLP 1 Chase Manhattan Plaza New York, NY 10005 Attention: Dennis F. Dunne, Esq. Samuel A. Khalil, Esq. Attorneys for the Ad Hoc Group of Second Lien Noteholders; and (j) the Office of the U.S. Trustee Amendment to RSA As reported by the Troubled Company Reporter, the Company entered into a Restructuring Support Agreement, dated as of April 13, 2014, among the Company, Holdings, the Filing Subsidiaries, certain affiliates of Apollo Global Management, LLC and certain holders of 9% Second-Priority Springing Lien Notes due 2021 and 9.5% Second-Priority Springing Lien Notes due 2021 that are not Apollo Entities, providing that the Plan Support Parties, which hold approximately 85% in dollar amount of the Second Lien Notes, will support, and vote in favor of, a Chapter 11 plan to be proposed by the Debtors. The Plan Support Parties have agreed, subject to definitive documentation, to backstop the $600 million rights offering in exchange for a fee, payable in new equity, of an additional 5% of the Rights Offering Amount. This fee is payable in kind at the closing of the rights offering, or in cash if the Debtors terminate the backstop commitment. On April 16, 2014, the Company entered into the First Amendment to Restructuring Support Agreement, providing that if any Plan Support Party transfers any claims to a "Qualified Marketmaker," the Qualified Marketmaker is not required to become a Consenting Noteholder so long as the Qualified Marketmaker subsequently transfers such claims to a party that is or becomes a Consenting Noteholder. Further, if a Consenting Noteholder is acting solely in its capacity as a Qualified Marketmaker, it may transfer claims that it acquires from a party that is not a Consenting Noteholder to another party that is not a Consenting Noteholder, without the requirement that the transferee become a Consenting Noteholder. A copy of the Restructuring Support Agreement, dated as of April 13, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., each of their direct and indirect domestic subsidiaries party thereto and certain holders of the Second Lien Notes party thereto, is available at http://is.gd/H66tIe A copy of the First Amendment to Restructuring Support Agreement, dated as of April 16, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., each of their direct and indirect domestic subsidiaries party thereto and certain holders of the Second Lien Notes party thereto, is available at http://is.gd/ySGEHT A copy of the Amended and Restated Senior Secured Debtor-in- Possession and Exit Asset-Based Revolving Credit Agreement, dated as of April 15, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., Momentive Performance Materials USA Inc., as U.S. borrower, Momentive Performance Materials GmbH and Momentive Performance Materials Quartz GmbH, as German borrowers, Momentive Performance Materials Nova Scotia ULC, as Canadian borrower, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent for the lenders, and the other parties named therein, is available at http://is.gd/EULkTS A copy of the Reaffirmation Agreement, dated as of April 15, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., Momentive Performance Materials USA Inc., as U.S. borrower, Momentive Performance Materials GmbH and Momentive Performance Materials Quartz GmbH, as German borrowers, Momentive Performance Materials Nova Scotia ULC, as Canadian borrower, and JPMorgan Chase Bank, N.A., as administrative and collateral agent, is available at http://is.gd/jQgXlB A copy of the Senior Secured Debtor-in-Possession Term Loan Agreement, dated as of April 15, 2014, by and among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., Momentive Performance Materials USA Inc., as borrower, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, is available at http://is.gd/EIR4t0 A copy of the Collateral Agreement, dated as of April 15, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., each Subsidiary Loan Party party thereto and JPMorgan Chase Bank, N.A., as collateral agent, is available at http://is.gd/WZcl10 A copy of the Guarantee Agreement, dated as of April 15, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., each Subsidiary Loan Party identified therein and JPMorgan Chase Bank, N.A., as administrative agent, is available at http://is.gd/tpndd9 A copy of the DIP Financing Intercreditor Agreement, dated as of April 15, 2014, among JPMorgan Chase Bank, N.A., as administrative and collateral agent for the ABL secured parties, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent for the term loan secured parties, and Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc. and each of its subsidiaries signatory thereto, is available at http://is.gd/bkq2yx About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and various affiliates sought Chapter 11 protection on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. The lead case is MPM Silicones LLC, Case No. 14-22503 (Bankr. S.D.N.Y.) The Debtors entered into a Restructuring Support Agreement, dated as of April 13, 2014, with certain affiliates of Apollo Global Management, LLC and certain holders of 9% Second-Priority Springing Lien Notes due 2021 and 9.5% Second-Priority Springing Lien Notes due 2021 that are not Apollo Entities, providing that the Plan Support Parties, which hold approximately 85% in dollar amount of the Second Lien Notes, will support, and vote in favor of, a Chapter 11 plan to be proposed by the Debtors. The Plan Support Parties have agreed, subject to definitive documentation, to backstop the $600 million rights offering in exchange for a fee, payable in new equity, of an additional 5% of the Rights Offering Amount. This fee is payable in kind at the closing of the rights offering, or in cash if the Debtors terminate the backstop commitment. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. Bankruptcy Judge Robert Drain presides over the cases. The Debtors have tapped Matthew A. Feldman, Esq. and Paul V. Shalhoub, Esq., at Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of the chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. Simpson Thacher & Bartlett LLP's Steven Fuhrman, Esq., Kathrine A. McLendon, Esq. and Nicholas Baker, Esq., represent the DIP Agents and the Cash Flow Agents. Simpson Thacher's Peter Pantaleo, Esq., represents the Prepetition ABL Agent. Emmet, Marvin & Martin, LLP's Edward P. Zujkowski, Esq., and Dechert LLP's Michael J. Sage, Esq., represent the First Lien Indenture Trustee. Ropes & Gray LLP's Mark R. Somerstein argues for the 1.5 Lien Indenture Trustee. Akin Gump Strauss Hauer & Feld LLP's Ira S. Dizengoff, Esq., and Philip C. Dublin, Esq., argue for Apollo. Milbank, Tweed, Hadley & McCloy LLP's Dennis F. Dunne, Esq., and Samuel A. Khalil, Esq., argue for the Ad Hoc Group of Second Lien Noteholders. MOMENTIVE PERFORMANCE: 7-Member Panel Named, Hires Klee Tuchin -------------------------------------------------------------- William K. Harrington, United States Trustee for Region 2, pursuant to Sections 1102(a) and (b) of the Bankruptcy Code, appointed these unsecured creditors that are willing to serve to the Official Committee of Unsecured Creditors of MPM Silicones, LLC and affiliated debtors: 1. US Bank National Association, as Indenture Trustee Global Corporate Trust Services 100 Wall Street, Suite 1600 New York, NY 10005 Attention: James E. Murphy, Vice President Telephone: (212) 951-8529 Email: James.Murphy3@usbank.com 2. BlueMountain Credit Alternatives Master Fund L.P. 280 Park Avenue - 12th Floor New York, NY 10017 Attention: Mark P. Kronfeld, Managing Director Telephone: (212) 905-2186 Email: mkronfeld@bmcm.com 3. Aurelius Capital Partners, LP 535 Madison Avenue - 22nd Floor New York, NY 10022 Attention: Dan Gropper Telephone: (646) 445-6570 Email: dgropper@aurelius-capital.com 4. Globe Specialty Metals One Penn Plaza, Suite 4125 250 West 34th Street New York, NY 10119 Attention: Gaurav Mehta, Managing Director Telephone: (212) 798-8136 Email: gmehta@glbsm.com 5. Fischback USA Inc. 900 Peterson Drive Elizabethtown, KY 42701 Attention: Kirk Chadwick Telephone: (270) 505-1243 Email: kirk.chadwick@fi-usa.com 6. Pension Benefit Guaranty Corporation 1200 K Street, N.W. Washington, D.C. 20005 Attention: Thea D. Davis, Attorney Telephone: (202) 326-4070, ext. 3166 Email: davis.thea@pbgc.gov 7. IUE-CWA, AFL-CIO P.O. Box 24366 Rochester, New York 14624 Attention: Joseph Giffi Telephone: (585) 797-4328 Email: jgiffi@iue-cwa.org The U.S. Trustee is represented in the case by: Brian S. Masumoto, Esq. Trial Attorney U.S. Department of Justice Office of the United States Trustee U.S. Federal Office Building 201 Varick Street, Room 1006 New York, NY 10014 Tel: (212) 510-0500 Fax: (212) 668-2255 The Proposed Counsel to the Committee are: Kenneth N. Klee, Esq. Lee R. Bogdanoff, Esq. Whitman L. Holt, Esq. KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 Avenue of the Stars, 39th Floor Los Angeles, CA 90067 Telephone: (310) 407-4000 Facsimile: (310) 407-9090 E-mail: kklee@ktbslaw.com lbogdanoff@ktbslaw.com wholt@ktbslaw.com About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and various affiliates sought Chapter 11 protection on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. The lead case is MPM Silicones LLC, Case No. 14-22503 (Bankr. S.D.N.Y.) The Debtors entered into a Restructuring Support Agreement, dated as of April 13, 2014, with certain affiliates of Apollo Global Management, LLC and certain holders of 9% Second-Priority Springing Lien Notes due 2021 and 9.5% Second-Priority Springing Lien Notes due 2021 that are not Apollo Entities, providing that the Plan Support Parties, which hold approximately 85% in dollar amount of the Second Lien Notes, will support, and vote in favor of, a Chapter 11 plan to be proposed by the Debtors. The Plan Support Parties have agreed, subject to definitive documentation, to backstop the $600 million rights offering in exchange for a fee, payable in new equity, of an additional 5% of the Rights Offering Amount. This fee is payable in kind at the closing of the rights offering, or in cash if the Debtors terminate the backstop commitment. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. Bankruptcy Judge Robert Drain presides over the cases. The Debtors have tapped Matthew A. Feldman, Esq. and Paul V. Shalhoub, Esq., at Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of the chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. Simpson Thacher & Bartlett LLP's Steven Fuhrman, Esq., Kathrine A. McLendon, Esq. and Nicholas Baker, Esq., represent the DIP Agents and the Cash Flow Agents. Simpson Thacher's Peter Pantaleo, Esq., represents the Prepetition ABL Agent. Emmet, Marvin & Martin, LLP's Edward P. Zujkowski, Esq., and Dechert LLP's Michael J. Sage, Esq., represent the First Lien Indenture Trustee. Ropes & Gray LLP's Mark R. Somerstein argues for the 1.5 Lien Indenture Trustee. Akin Gump Strauss Hauer & Feld LLP's Ira S. Dizengoff, Esq., and Philip C. Dublin, Esq., argue for Apollo. Milbank, Tweed, Hadley & McCloy LLP's Dennis F. Dunne, Esq., and Samuel A. Khalil, Esq., argue for the Ad Hoc Group of Second Lien Noteholders. MOMENTIVE PERFORMANCE: Files First Amendment to Plan Support Deal ----------------------------------------------------------------- Momentive Performance Materials Inc. and its debtor affiliates filed with the U.S. Bankruptcy Court for the Southern District of New York a first amendment to the restructuring support agreement to modify Section 8.1 of the RSA. A full-text copy of the First Amendment is available at: http://bankrupt.com/misc/MOMENTIVErsa10416.pdf The key terms of the RSA include a $600 million rights offering, which will provide a significant equity infusion to the Company, along with the securing of commitments for $1.3 billion of exit financing. The RSA has been supported by holders owning approximately 85% of the company's Second Lien Notes. About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and their affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 14-22503) on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. The Debtors have tapped Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of these chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. MOMENTIVE PERFORMANCE: Has Interim OK to Pay Trade Creditors ------------------------------------------------------------ MPM Silicones, LLC, et al., sought and obtained interim authority from the U.S. Bankruptcy Court for the Southern District of New York to pay trade claims in an amount not to exceed $21 million. The deadline by which objections to the Motion and the Final Order must be filed is May 8, 2014. The Court will hold a final hearing on the Motion, if required, on May 15, at 9:30 a..m. (prevailing Eastern Time). If no objections are filed to the Motion and entry of the Final Order on or before the Objection Deadline, the Court may enter the Final Order without further notice or a hearing. About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and their affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 14-22503) on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. The Debtors have tapped Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of these chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. MT. GOX: Tokyo Court Orders Commencement of Liquidation ------------------------------------------------------- Takashi Mochizuki, writing for The Wall Street Journal, reported that collapsed bitcoin exchange Mt. Gox said that a Tokyo court had told it to begin liquidation proceedings. "At 5 p.m on April 24, the Tokyo District Court issued an order of commencement of the bankruptcy proceedings for Mt. Gox," the report cited a statement signed by the exchange and by court- appointed trustee Nobuaki Kobayashi. According to the report, blaming hacking attacks for losing 850,000 bitcoins worth half a billion dollars, the exchange in February filed for court-let rehabilitation proceedings. But faced with difficulties in implementing the required steps, Mt. Gox asked the court last week to allow it to go into liquidation, with the court accepting the request and scrapping the rehabilitation filing. In the statement, Mr. Kobayashi said he would investigate the lost bitcoins and cash "to the extent possible through its asset administration," the report related. For the exchange's 127,000 creditors, liquidation is no better than rehabilitation, the report further related. Last week, a group of U.S. investors launched savegox.com, a website aimed at persuading Mr. Kobayashi and the court to let investors take over the company and reorganize it. About Mt. Gox Bitcoin exchange MtGox Co., Ltd., filed a petition under Chapter 15 of the U.S. Bankruptcy Code on March 9, 2014, days after the company sought bankruptcy protection in Japan. The bankruptcy in Japan came after the bitcoin exchange lost 850,000 bitcoins valued at about $475 million "disappeared." The Japanese bitcoin exchange that halted trading in February 2014. It filed for bankruptcy protection in the U.S. to prevent customers from targeting the cash it holds in U.S. bank accounts. The Chapter 15 case is In re MtGox Co., Ltd., Case No. 14-31229 (Bankr. N.D. Tex.). The Chapter 15 Petitioner is Robert Marie Mark Karpeles, the company's chief executive officer. Mr. Karpeles is represented by John E. Mitchell, Esq., and David William Parham, Esq., at BAKER & MCCKENZIE LLP, in Dallas, Texas. The company said it has estimated assets of $10 million to $50 million and debts of $50 million to $100 million. NETWORK CN: Widens Loss to $3.89-Mil. in 2013 --------------------------------------------- Network CN Inc. had a net loss of $3.89 million on $891,000 of revenues in 2013, compared with a net loss of $1.21 million on $1.84 million of revenues in 2012, according to a filing with the U.S. Securities and Exchange Commission. Union Power HK CPA Limited expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred net losses of $3.88 million, $1.21 million and $2.10 million for the years ended Dec. 31, 2013, 2012 and 2011 respectively. Additionally, the Company used net cash in operating activities of $680,000, $583,000 and $388,000 for 2013, 2012 and 2011, respectively. As of Dec. 31, 2013, and 2012, the Company recorded stockholders' deficits of $7.66 million and $4.03 million, respectively. The Company's balance sheet at Dec. 31, 2013, showed $1.29 million in total assets against $8.95 million in total liabilities. A copy of the Form 10-K is available at: http://is.gd/aoeZPO About Network CN Causeway Bay, Hong Kong-based Network CN Inc. provides out-of-home advertising in China, primarily serving the needs of branded corporate customers. NEWLEAD HOLDINGS: MGP Asks 5.8 Million Add'l Settlement Shares -------------------------------------------------------------- MG Partners Limited, on April 15, 2014, requested 1,100,000 additional settlement shares, on April 16, 2014, MGP requested 2,200,000 additional settlement shares, and on April 17, 2014, MGP requested 2,500,000 additional settlement shares, pursuant to the terms of a settlement agreement with NewLead Holdings Ltd. Following the issuances of the above amounts, the Company will have approximately 33,013,274 shares outstanding, which outstanding amount includes recent share issuances related to partial exercises of outstanding warrants and partial conversions of outstanding preferred stock. On Dec. 2, 2013, the Supreme Court of the State of New York, County of New York, entered an order approving, among other things, the fairness of the terms and conditions of an exchange pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, in accordance with a stipulation of settlement among NewLead Holdings Ltd., Hanover Holdings I, LLC, and MG Partners Limited, in the matter entitled Hanover Holdings I, LLC v. NewLead Holdings Ltd., Case No. 160776/2013. Hanover commenced the Action against the Company on Nov. 19, 2013, to recover an aggregate of $44,822,523 of past-due indebtedness of the Company, which Hanover had purchased from certain creditors of the Company pursuant to the terms of separate purchase agreements between Hanover and each of those creditors. Pursuant to the terms of the Settlement Agreement approved by the Order, on Dec. 2, 2013, the Company issued and delivered to MGP, as Hanover's designee, 175,000 shares of the Company's common stock, $0.01 par value. Between Jan. 3, 2014, and April 11, 2014, the Company issued and delivered to MGP an aggregate of 7,110,000 (adjusted to give effect to a 1 for 10 reverse stock split effective March 6, 2014) Additional Settlement Shares pursuant to the terms of the Settlement Agreement approved by the Order. A full-text copy of the Form 6-K report is available at: http://is.gd/MxprDM About NewLead Holdings Based in Athina, Greece, 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. NewLead'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. As of June 30, 2013, the Company had $84.27 million in total assets, $166.18 million in total liabilities and a $81.91 million total shareholders' deficit. 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. NEW FARMERS BUILDING: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: New Farmers Building Corporation 2810 Hoitt Avenue Knoxville, TN 37917 Case No.: 14-31328 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court Eastern District of Tennessee (Knoxville) Judge: Hon. Richard Stair Jr. Debtor's Counsel: Thomas Lynn Tarpy, Esq. TARPY, COX, FLEISHMAN & LEVEILLE, PLLC 1111 Northshore Drive Landmark Tower North, Suite N-290 Knoxville, TN 37919 Tel: (865) 588-1096 Fax: (865) 588-1171 Email: ltarpy@tcflattorneys.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Kim Mullins, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. ON ASSIGNMENT: S&P Raises CCR to 'BB' on Reduced Debt Leverage -------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Calabasas, Calif.-based staffing company On Assignment Inc. to 'BB' from 'BB-'. The outlook is stable. At the same time, S&P revised the recovery rating on the company's senior secured credit facilities to '2', indicating its expectation for substantial (70%-90%) recovery in the event of a payment default from '3' (50%-70% recovery expectation). S&P subsequently raised its issue-level rating on this debt to 'BB+' from 'BB-'. The recovery rating revision reflects S&P's expectation for slightly better recovery prospects, given its estimate of lower secured debt outstanding under its simulated default scenario, following the $82.5 million add-on to the more rapidly amortizing term loan A and repayment with the proceeds of term loan B. "The upgrade reflects our expectation that the business outlook for information technology staffing services will remain favorable, which should result in a continued reduction in debt leverage," said Standard & Poor's credit analyst Hal Diamond. S&P expects that the company will maintain debt leverage below 2.5x over the intermediate term, despite an acquisition orientation, due to moderate discretionary cash flow generation and periodic use of common stock to pay for a portion of large acquisitions. S&P also expects that management would seek to deleverage following a large acquisition by applying the majority of discretionary cash flow to debt reduction. The 'BB' corporate credit rating reflects S&P's assessment of the business risk profile as "weak" and the financial risk profile as "intermediate." The company's "weak" business risk profile reflects S&P's assessment of its niche market position in the highly competitive and fragmented professional staffing industry as well as the risks related to managing its acquisition pace and brisk organic growth. OVERSEAS SHIPHOLDING: Recanati et al. Disclose Equity Stake ----------------------------------------------------------- Oudi Recanati et al. filed a Schedule 13D/A (Amendment No. 16) with the Securities and Exchange Commission disclosing their equity stake in Overseas Shipholding Group, Inc. On April 21, 2014, the Recanati Family Stockholders entered into a Termination Agreement, pursuant to which the Recanati Family Stockholders agreed to terminate an Amended and Restated Stockholders Agreement, and Diane Recanati, Oudi Recanati and the Starec Trust agreed to terminate the Separate Stockholders Agreement, and as a result, the Recanati Family Stockholders are no longer deemed to share the power to vote or the power to dispose of their shares of OSG Common Stock. Following the Termination Agreement, each of Diane Recanati, Grantchester, LLC, the Diane Recanati Trust, Oudi Recanati, the Eagle Corporation, Leon Recanati, Yudith Yovel Recanati, Gandyr Nadlan Ltd., Ariel Recanati, Leon (Lenny) Recanati, David Recanati, Michael Recanati, the SEAVIEW Trust and the Starec Trust ceased to be a beneficial owner of more than 5% of OSG Common Stock on April 21, 2014. Following the Termination Agreement: -- Diane Recanati may be deemed to beneficially have sole voting and dispositive power over 637,390 shares of Common Stock held by Granchester, LLC, which represents 2.08% of the Common Stock outstanding, and 7,500 shares of Common Stock held by the Diane Recanati Trust, which represents 0.02% of the Common Stock outstanding, for a total of 644,890 shares of Common Stock, which represents 2.10% of the Common Stock outstanding; -- Oudi Recanati has sole voting and dispositive power over 1,310,356 shares of Common Stock, which represents 4.27% of the Common Stock outstanding, and may be deemed to beneficially have sole voting and dispositive power over an additional 148,198 shares of Common Stock held by Eagle Corporation, which represents 0.48% of the Common Stock outstanding, for a total of 1,458,554 shares of Common Stock, which represents 4.75% of the Common Stock outstanding; -- Leon Recanati has sole voting and dispositive power over 603,931 shares of Common Stock, which represents 1.97% of the Common Stock outstanding; -- Yudith Yovel Recanati has sole voting and dispositive power over 627,964 shares of Common Stock, which represents 2.05% of the Common Stock outstanding, and may be deemed to beneficially have sole voting and dispositive power over an additional 25,000 shares of Common Stock held by Gandyr Nadlan Ltd., which represents 0.08% of the Common Stock outstanding, for a total of 652,964 shares of Common Stock, which represents 2.12% of the Common Stock outstanding; -- Ariel Recanati has sole voting and dispositive power over 76,179 shares of Common Stock, which represents 0.25% of the Common Stock outstanding; -- David Recanati has sole voting and dispositive power over 153,879 shares of Common Stock, which represents 0.50% of the Common Stock outstanding; -- Michael Recanati has sole voting and dispositive power over 16,368 shares of Common Stock, which represents 0.05% of the Common Stock outstanding; -- the SEAVIEW Trust has sole voting and dispositive power over 246,812 shares of Common Stock, which represents 0.80% of the Common Stock outstanding; and -- Leon (Lenny) Recanati and the Starec Trust no longer hold any shares of Common Stock. About Overseas Shipholding Overseas Shipholding Group, Inc. (OTC: OSGIQ), headquartered in New York, is one of the largest publicly traded tanker companies in the world, engaged primarily in the ocean transportation of crude oil and petroleum products. OSG owns or operates 111 vessels that transport oil and petroleum products throughout the world. Overseas Shipholding Group and 180 affiliates filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67 billion in liabilities. Greylock Partners LLC Chief Executive John Ray serves as chief reorganization officer. James L. Bromley, Esq., and Luke A. Barefoot, Esq., at Cleary Gottlieb Steen & Hamilton LLP serve as OSG's Chapter 11 counsel. Derek C. Abbott, Esq., Daniel B. Butz, Esq., and William M. Alleman, Jr., at Morris, Nichols, Arsht & Tunnell LLP, serve as local counsel. Chilmark Partners LLC serves as financial adviser. Kurtzman Carson Consultants LLC is the claims and notice agent. The Export-Import Bank of China, owed $312 million used for the construction of five tankers, is represented by Louis R. Strubeck, Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at Fulbright & Jaworski in New York; and John Knight, Esq., and Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark Partners, LLC serves as financial and restructuring advisor. Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve as co-counsel to the official committee of unsecured creditors. FTI Consulting, Inc., is the financial advisor and Houlihan Lokey Capital, Inc., is the investment banker. PEM THISTLE: Court Dismisses Case, Debtor Seeks Reconsideration --------------------------------------------------------------- DOF IV Reit Holdings, LLC, moved for the dismissal of the bankruptcy case of PEM Thistle Landing TIC 23, LLC. DOF IV is the Debtor's secured lender by assignment. The Debtor is one of the 31 tenants-in-common of the commercial property known as Thistle Landing. Two of the TICs borrowed almost $40 million from PNC Bank, N.A., which later reassigned the loan to DOF IV. The loan is secured by the Property. However, as the TICs and the Debtor failed to make payments on the loan by early 2013, DOF IV commenced a non-judicial foreclosure sale on the Property. After due deliberation, in a ruling entered in early April, Judge Kevin Gross dismissed the case without prejudice. "The fatal flaw in Debtor's case is that as a tenant-in-common with less than a one percent interest, it cannot bind or do the bidding of the non-debtor TICs (owning interests of more than 99%). The Debtor cannot force DOF IV to restructure the Security Interest. As a result, Debtor cannot establish a "reasonable possibility of a successful reorganization within a reasonable time," the judge said in a Memorandum Opinion dated April 2, 2014. However, the Court finds that Debtor did not file the case in bad faith. "The Debtor filed the case in the face of foreclosure to save the Property after DOF IV refused to negotiate. While the Court disagrees with Debtor's legal right to have filed the bankruptcy petition, Debtor did so for a valid business purpose, i.e., to preserve its sole asset under pressure of foreclosure. Under such circumstances, a bad faith finding would be inappropriate. Dismissal on the ground of bad faith should be reserved for cases of clear abuse," the judge held. Debtor Seeks Reconsideration The Debtor is asking the Court to reconsider the Dismissal Order for the limited purposes of (1) withdrawing the Plan, and (2) seeking immediate authority to sell the Property. The Debtor says it has no intention of submitting another plan to the Court. After dismissal, it determined that a sale process was the best way to proceed. At this time, the Debtor discloses, at least five potential purchasers have presented offers to purchase the Property, with several of such offers in excess of the secured claim of DOF. At least one of the purchasers, Lincoln Property Company, is immediately prepared to close on an all-cash purchase of the Property for $39.75 million and is willing to effectuate such purchase through the Chapter 11 case, according to the Debtor. About PEM Thistle PEM Thistle Landing TIC 23, LLC, filed a bare-bones Chapter 11 petition (Bankr. D. Del. Case No. 13-13273) in Delaware on Dec. 17, 2013. The Debtor is a Single Asset Real Estate as defined in 11 U.S.C. Sec. 101(51B) and its principal asset is located at 4801 East Thistle Landing Drive, in Phoenix, Arizona. Kathleen Mellor and Richard Mellor own 100% of the outstanding membership interests in the Debtor. Ms. Mellor, as director, signed the bankruptcy petition. Kevin Scott Mann, Esq., at Cross & Simon, LLC, in Wilmington, Delaware, serves as local counsel. The board resolution authorizing the bankruptcy filing says that the Debtor is authorized to hire the law firm of Freeborn & Peters LLP as general bankruptcy counsel. Judge Kevin Gross presides over the case. The U.S. Trustee has not appointed an official Committee of unsecured creditor. PETRON ENERGY: Amends 300 Million Shares Prospectus --------------------------------------------------- Petron Energy II, Inc., amended its registration statement on Form S-1 relating to the offering of 300,000,000 shares of the Company's common stock that the Company will put to CPUS Income Group LLC pursuant to that certain investment agreement. The Investment Agreement was entered into on Dec. 13, 2013. The Company amended the registration statement to delay its effective date. A copy of the Form S-1/A is available for free at: http://is.gd/iH81Lg About Petron Energy Dallas-based Petron Energy II, Inc., is engaged primarily in the acquisition, development, production, exploration for and the sale of oil, gas and gas liquids in the United States. As of Dec. 31, 2011, the Company is operating in the states of Texas and Oklahoma. In addition, the Company operates two gas gathering systems located in Tulsa, Wagoner, Rogers and Mayes counties of Oklahoma. The pipeline consists of approximately 132 miles of steel and poly pipe, a gas processing plant and other ancillary equipment. The Company sells its oil and gas products primarily to a domestic pipeline and to another oil company. KWCO, PC, in Odessa, TX, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company's significant operating losses since inception raise substantial doubt about its ability to continue as a going concern. The Company's balance sheet at Sept. 30, 2013, showed $3.27 million in total assets, $4.79 million in total liabilities and a $1.51 million total stockholders' deficit. PILOT TRAVEL: S&P Revises Outlook to Stable & Affirms 'BB' CCR -------------------------------------------------------------- Standard & Poor's Ratings Services revised the outlook on Knoxville, Tenn.-based travel center operator Pilot Travel Centers LLC to stable from negative. S&P affirmed its ratings on the company, including the 'BB' corporate credit rating. At the same time, S&P is affirming its 'BB' senior secured issue- level rating on the company's revolving credit facility and term debt. The recovery rating on the secured debt remains '3', indicating S&P's expectation for meaningful recovery (50% to 70%) of principal in the event of a payment default. "The outlook revision to stable reflects our expectation that Pilot's liquidity will remain adequate over the near to intermediate term even after funding payments to settle charges that it withheld fuel rebates from some customers," said credit analyst Samantha Stone. "The company has already settled with many customers, although others that opted out of the class action lawsuit continue to sue the company and we think a meaningful federal fine is likely. We believe the vast majority of customer and vendor relationships have returned to normal given the company's broad scale of operations." S&P's stable outlook reflects the expectation that the company will maintain adequate liquidity over the near term despite the higher cash expenses as a result of the likely penalty from the federal government and settlement of outstanding lawsuits regarding withholding fuel rebates from customers. S&P expects leverage will remain in the mid-3.0x area and FFO in the 25% area over the next 12 months. Downside scenario S&P could lower the ratings if the cost of any fines from the federal investigation or other suits is large enough to significantly reduce liquidity on a sustained basis or raise leverage above 4x for a prolonged period. S&P could also lower the rating if federal charges or additional litigation came to light that caused it to reconsider the broader impact of the rebate issues on the business or financial risk profile. Alternatively, S&P could lower the rating if fuel margins declined to about 12 cents per gallon and merchandise margins drop to about 25% because of increased competitive pressures and the inability to pass on cost increases. Under this scenario, leverage rises to more than 4x and FFO to debt drops below 20% and S&P would likely reassess financial risk as "aggressive". Upside scenario S&P views the potential for an upgrade as unlikely given its expectations for the company's operating performance and credit metrics. The potential for an upgrade would be predicated on meaningful moderation of financial policies and the company achieving greater-than-anticipated earnings improvement and debt reduction. In this scenario, the company needs to demonstrate that it would maintain leverage and FFO/debt around below 3x and FFO/debt above 30%, leading to financial risk assessment of "intermediate". In addition, all issues from the rebate matter would need to be resolved. Other Modifiers S&P continues to assess the company's management and governance score as "weak", which had a one-notch negative effect on the rating outcome. S&P based its assessment on weak internal controls along with compliance breakdowns among certain sales functions, which resulted in several lawsuits and charges by the government that the company withheld fuel rebates from some of its customers. S&P acknowledges that extensive changes have been made to internal pricing and control systems in recent quarters. S&P also adjusted the initial rating outcome by one notch based on a "favorable" comparable ratings analysis. S&P believes Pilot's business risk profile will sustain a position at the higher end of the fair business risk profile over the intermediate term given its good competitive position. No other modifiers affect the rating. POCMONT PROPERTIES: Files Ch.11, In Talks to Sell Bushkill Inn -------------------------------------------------------------- Beth Brelje, writing for Pocono Record, reported that The Bushkill Inn and Conference Center in Lehman Township has filed for Chapter 11 bankruptcy under the name Pocmont Properties, and court papers indicate that Pocmont is in discussions to be sold. The report, citing court records, said two owners held an emergency meeting April 2 and agreed that bankruptcy was in the best interest of the company and its creditors. Bushkill Inn General Manager Roger Taylor said the Bushkill Inn will stay open for business and that staffers will keep their jobs and continue to be paid. Meanwhile, the inn's website is still promoting New Year's Eve and winter ski packages. The report recounted that the Bushkill Inn, a 167-acre property on Bushkill Falls Road, was formally known as the Pocmont Resort. It closed in November 2009 and had been owned by the Artzt family for 63 years. The resort was once valued at $8.23 million, and was purchased for $2 million by a group of eight partners under the name Pocmont Properties LLC. The owners include Isaac Greenwald of Greenwald Caterers of Lakewood, N.J. and Nchemya Leiman. The report said the Bushkill Inn opened in August 2012 after the group renovated the property. But contractors who made the improvements have not been fully paid, according to court records. The company is named in several lawsuits in the Pike County Court of Common Pleas: -- Strauser Nature's Helpers of East Stroudsburg sued in January to recoup $29,700 still owed under a landscaping Agreement; -- Gary J. Gallerie Son and Associates of Stroudsburg sued to recover $5,500 which remain unpaid under a separate $55,626 landscaping deal; -- Saje Build of Brooklyn, N.Y., sued over $345,000 in unpaid materials and labor for renovation work; -- Michael Spitzer LLC, a Brooklyn, N.Y.-based lender, sued over a $740,000 loan agreement in September 2010. The property was to be used to secure the loan, but Greenwald never signed the security paper so it was never recorded. Now, court papers say, the original security paper cannot be found and Greenwald and another signer, Yehuda Margules of Lakewood, N.J., refuse to execute a new one. Spitzer is asking the court to require a security agreement dated in 2010 to be signed for the money that was lent, so if the Bushkill Inn is sold, the loan is in line to be paid off. POLEY PAVING: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Poley Paving Corporation P.O. Box 916 Liberty, NY 12754 Case No.: 14-35824 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court Southern District of New York (Poughkeepsie) Judge: Hon. Cecelia G. Morris Debtor's Counsel: Thomas Genova, Esq. GENOVA & MALIN, ATTORNEYS Hampton Business Center 1136 Route 9 Wappingers Falls, NY 12590-4332 Tel: (845) 298-1600 Fax: (845) 298-1265 Email: genmallaw@optonline.net Total Assets: $718,869 Total Liabilities: $2.13 million The petition was signed by Stephen Poley, vice president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/nysb14-35824.pdf POLY PLANT PROJECT: Employs Donahoe & Young as Attorneys -------------------------------------------------------- Poly Plant Project seeks authority from the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, to employ Donahoe & Young LLP as attorneys to advise the Debtor regarding matters of bankruptcy law relevant to the pending Chapter 11 case. D&Y has agreed to accept as compensation for its services the following hourly fees: $450 per hour for Mark T. Young, Esq. -- myoung@donahoeyoung.com -- or other partners of D&Y; $350 per hour for associate, staff, and contract attorneys with more than five years of experience as an attorney; $300 per hour for associate, staff, and contract attorneys with less than five years of experience as an attorney; $150 per hour for law clerks who have completed at least four semesters of law school, but who are not active members of the California Bar; $100 for law clerks who have completed at least one, but less than four, semesters of law school and are not members of the California Bar, and certified paralegals; and $50 per hour for non-attorney legal assistants. D&Y did not represent, or perform any legal services for, PPP prior to March 12, 2014. D&Y has received three payments from PPP for legal services: (1) $10,000 received on March 21, 2014; (2) $30,000 received on April 4, 2014; and (3) $1,213 received on April 11, 2014. The first payment was designated for negotiations with PPP?s three major unsecured majority non-insider creditors, and preparation of some materials that would be needed in the event that a Chapter 11 filing became required. The second payment was the prepetition retainer for this Chapter 11 case, and the third payment was for the filing fee for the case. Mr. Young assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Poly Plant Project filed a Chapter 11 bankruptcy petition in its hometown in Los Angeles (Bankr. C.D. Cal. Case No. 14-17109) on April 14, 2014. Tetsunori T. Kunimune signed the petition as chief executive officer. The Debtor disclosed total assets of $16.75 million and total liabilities of $22.29 million. Donahoe & Young LLP serves as the Debtor's counsel. Judge Thomas B. Donovan oversees the case. POSITRON CORP: Sassetti LLC Again Raises Going Concern Doubt ------------------------------------------------------------ Positron Corporation had a net loss of $7.1 million on $1.63 million of revenues in 2013, compared with a net loss of $7.96 million on $2.8 million of revenues in 2012, according to the Company's latest Form 10-K filed with the U.S. Securities and Exchange Commission. The Company disclosed a net loss and comprehensive loss of $6.12 million in 2011. Sassetti LLC expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has a significant accumulated deficit. Sassetti had issued a going-concern qualification following the 2012 results, also noting of the Company's significant accumulated deficit. The Company's balance sheet at Dec. 31, 2013, showed $3.88 million in total assets, $15.12 million in total liabilities, and stockholders' deficit of $11.24 million. A copy of the Form 10-K is available at: http://is.gd/tbh04a About Positron Corporation Headquartered in Fishers, Indiana, Positron Corporation is a molecular imaging company focused on nuclear cardiology. PRESSURE BIOSCIENCES: Marcum Again Raises Going Concern Doubt ------------------------------------------------------------- Pressure BioSciences, Inc., had a net loss of $4.08 million on $1.50 million of revenues in 2013, compared with a net loss of $3.45 million on $1.24 million of revenues in 2012. Marcum, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has had recurring net losses and continues to experience negative cash flows from operations. Last year, Marcum LLP also issued a going-concern qualification following the 2012 results. The Company's balance sheet at Dec. 31, 2013, showed $1.1 million in total assets, $3.07 million in total liabilities, and a stockholders' deficit of $1.97 million. A copy of the Form 10-K is available at: http://is.gd/5JSfF6 About Pressure Biosciences Pressure BioSciences, Inc., headquartered in South Easton, Massachusetts, holds 14 United States and 10 foreign patents covering multiple applications of pressure cycling technology in the life sciences field. PRIME TIME INT'L: Taps Schian Walker as Conflicts Counsel --------------------------------------------------------- Prime Time International Company and its debtor-affiliates seek permission from the U.S. Bankruptcy Court for the District of Arizona to employ Schian Walker, PLC as special bankruptcy counsel. The professional services that Schian Walker will render are limited to those instances where an actual or potential conflict is identified by Greenberg Traurig, LLP ("Lead Counsel"). Schian Walker's representation does not include securities work, tax work (except as to the dischargeability of taxes), accounting advice, or criminal matters. With respect to those instances where an actual or potential conflict is identified by Lead Counsel, Schian Walker may render services that include the following: (a) provide the Debtors legal advice with respect to their reorganization; (b) represent the Debtors in connection with negotiations involving secured and unsecured creditors; (c) represent the Debtors at the meeting of creditors, confirmation hearings, and other hearings that the Court requires; and (d) prepare necessary applications, motions, answers, orders, reports, or other legal papers necessary to assist in the Debtors' reorganization. Schian Walker will be paid at these hourly rates: Dale C. Schian $525 Scott R. Goldberg $460 Schian Walker will also be reimbursed for reasonable out-of-pocket expenses incurred. Dale C. Schian, managing member of Schian Walker, 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. Schian Walker can be reached at: Dale C. Schian, Esq. SCHIAN WALKER, P.L.C. 1850 North Central Avenue, #900 Phoenix, AZ 85004-4531 Tel: (602) 277-1501 Fax: (602) 297-9633 E-mail: ecfdocket@swazlaw.com About Prime Time International Prime Time International Company, formerly known as Single Stick Inc., manufactures and distributes cigarettes and little cigars. PTIC has two wholly-owned subsidiaries: USA Tobacco, which distributes PTIC's products, and 21st Century Brands, LLC, which distributes non-tobacco consumer products. Annual sales are $40 million and the company's products are in 100,000 convenience stores in North America. The company has direct accounts with each of the top 25 largest convenience store distributors in the United States. Prime Time and its two subsidiaries sought Chapter 11 bankruptcy protection (Bankr. D. Ariz. Lead Case No. 14-03518) in Phoenix on March 15, 2014. The Debtors have tapped Greenberg Traurig as attorneys, Odyssey Capital Group, LLC, as financial advisors, and Schian Walker, P.L.C., as conflicts counsel. The Debtors disclosed $26.78 million in total assets and $23.37 million in total liabilities as of Jan. 31, 2014. QUANTASON LLC: 3-D Ultrasound Developer Files for Quick Sale ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Quantason LLC, a developer of three-dimensional ultrasound screening for breast cancer, filed a Chapter 11 petition on April 23 in Delaware preparing to sell the business at auction on June 9. According to the report, the Los Angeles-based company is yet to generate revenue because the products haven't been approved for use. Assets are shown for $256,000 against debt totaling $1.2 million, the report related. The company needed a new round of $10 million in financing, the report further related. Although potential investors were identified, existing stakeholders couldn't agree on terms, according to a court filing, the report added. The case is In re Quantason LLC, 14-bk-10932, U.S. Bankruptcy Court, District of Delaware (Wilmington). QUANTASON LLC: Case Summary & 6 Unsecured Creditors --------------------------------------------------- Debtor: Quantason, LLC Howard Hughes Center 6080 Center Drive, Suite 910 Los Angeles, CA 90045 Case No.: 14-10932 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Delaware (Delaware) Judge: Peter J. Walsh Debtor's Counsel: Daniel N. Brogan, Esq. DLA PIPER LLP (US) 1201 N. Market Street, Suite 2100 Wilmington, DE 19801 Tel: 302.468.5648 Fax: 302.394.2341 Email: Daniel.Brogan@dlapiper.com - and - R. Craig Martin, Esq. DLA PIPER LLP (US) 919 North Market Street, Suite 1500 Wilmington, DE 19801 Tel: 302-468-5655 Fax: 302-778-7834 Email: craig.martin@dlapiper.com - and - Kimberly D. Newmarch, Esq. DLA PIPER LLP (US) 203 North LaSalle Street, 19th Floor Chicago, Illinois 60601 Tel: (312)368-4000 Fax: (312)236-7516 Email: kim.newmarch@dlapiper.com Total Assets: $585,994 at March 31, 2014 Total Liabilities: $893,355 at March 31, 2014 The petition was signed by Lawrence R. Perkins, president and CEO. A list of the Debtor's largest unsecured creditors is available for free at http://bankrupt.com/misc/deb14-10932.pdf QUANTUM CORP: Director Michael Brown Won't Seek for Re-Election --------------------------------------------------------------- Michael A. Brown, a member of the Board of Directors of Quantum Corporation, informed the Board that he will not be standing for re-election to the Board at the Company's 2014 annual meeting of stockholders. The decision of Mr. Brown to not stand for re- election to the Board was the result of Mr. Brown's appointment as the interim CEO of Symantec Corporation and not the result of any dispute or disagreement with the Company on any matter relating to the Company's operations, policies or practices. About Quantum Corp. Based in San Jose, California, Quantum Corp. (NYSE:QTM) -- http://www.quantum.com/-- is a storage company specializing in backup, recovery and archive. Quantum provides a comprehensive, integrated range of disk, tape, and software solutions supported by a world-class sales and service organization. For the 12 months ended March 31, 2013, the Company incurred a net loss of $52.41 million following a net loss of $8.81 million for the year ended March 31, 2012. As of Dec. 31, 2013, the Company had $360.27 million in total assets, $439.90 million in total liabilities and a $79.62 million total stockholders' deficit. RIVIERA HOLDINGS: Incurs $26.7-Mil. Net Loss in 2013 ---------------------------------------------------- Riviera Holdings Corporation had a net loss of $26.7 million on $72.8 million of revenues in 2013, compared with a net loss of $29.6 million on $86.28 million of revenues in 2012, according to a Form 10-K filed with the U.S. Securities and Exchange Commission. Ernst & Young LLP expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has recurring losses from operations and has a working capital deficiency. In addition, the Company is in default under the loan agreements with its stockholders. The Company's balance sheet at Dec. 31, 2013, showed $207 million in total assets, $121 million in total liabilities, and stockholders' equity of $85.6 million. A copy of the Form 10-K is available at: http://is.gd/Y0ytIU About Riviera Holdings Riviera Holdings Corporation, through its wholly owned subsidiary, Riviera Operating Corporation, owns and operates the Riviera Hotel & Casino located on Las Vegas Boulevard in Las Vegas, Nevada. Riviera Hotel & Casino, which opened in 1955, has a long-standing reputation for delivering traditional Las Vegas-style gaming, entertainment and other amenities. On July 12, 2010, RHC, ROC and the Riviera Black Hawk casino filed petitions for relief under the provisions of Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Nevada. On Nov. 17, 2010, the Bankruptcy Court entered a written order confirming the Debtors' Second Amended Joint Plan of Reorganization. On December 1, 2010, the Plan became effective. On April 1, 2011, the Debtors emerged from reorganization proceedings under the Bankruptcy Code. Thomas H. Fell, Esq., at Gordon Silver, represented the Debtors in the Chapter 11 cases. XRoads Solutions Group, LLC, served as the financial and restructuring advisor. Garden City Group Inc. served as the claims and notice agent. On April 26, 2012, RHC completed the sale of Riviera Black Hawk casino to Monarch Casino and Resorts, Inc., and its wholly-owned subsidiary Monarch Growth Inc. The Buyer purchased Riviera Black Hawk by acquiring all of the issued and outstanding shares of common stock of RHC's subsidiary Riviera Black Hawk. The Buyer paid $76 million for the stock, subject to certain post-closing working capital adjustments. At the closing, ROC paid or satisfied substantially all of RBH's indebtedness (which consisted of inter-company accounts and equipment leases) and placed $2.1 million of working capital in a restricted bank account. Accordingly, the Company has reflected the business, including gain on sale, as discontinued operations. In July 2013, Moody's Investors Service downgraded Riviera Holdings' ratings, including its Corporate Family Rating to Caa3 from Caa2 and its Probability of Default Rating to Caa3-PD from Caa2-PD. At the same time, Moody's downgraded Riviera's first lien term loan and revolver to Caa2 from Caa1, its second lien term loan to Ca from Caa3 and its Speculative Grade Liquidity rating to SGL-4 from SGL-3. The rating outlook is negative. The downgrade reflected Moody's view that Riviera's capital structure is unsustainable given growing operating losses and its inability to cover debt service and capex needs given limited available cash balances. Moody's at that time said that, although the company continues to pay required interest on time, it remains in technical default of financial covenants. ROCKET SOFTWARE: Moody's Affirms B2 CFR & Changes Outlook to Neg. ----------------------------------------------------------------- Moody's Investors Service revised Rocket Software, Inc.'s ratings outlook to negative and affirmed its B2 corporate family rating and B2-PD probability of default. Moody's also rated the company's proposed first lien debt B1 and second lien debt Caa1. The proposed debt will be used to refinance existing debt and fund a $279 million equity distribution to the co-founders and private equity firm Court Square Capital Partners. Ratings Rationale The change in outlook to negative is driven by the large increase in debt as a result of the proposed equity distribution and limited flexibility within the B2 rating category, particularly given Rocket's acquisition appetite. As a result of the proposed debt, leverage increases to 6.3x pro forma for a full year of recent acquisitions, D3 and Trubiquity, and excluding restructuring and transaction charges (6.5x when counting restructuring and transaction expenses), which is above Moody's threshold for a B2 rating for Rocket. However, leverage should come down to below 6x over the next year and free cash flow to debt levels should exceed 7% which Moody's view as within the B2 range for this company. Rocket is acquisitive though and additional debt funded acquisitions could drive a downgrade. Ratings could also be downgraded if performance deteriorates or leverage is expected to remain above 6x or free cash flow to debt falls below 6% on other than a temporary basis. Rocket continues to deliver strong EBITDA margins and generates strong levels of free cash flow. The B2 rating reflects the company's niche position providing infrastructure software and tools for mainframe and distributed markets, longstanding supply relationship with a major OEM supplier, and relatively high proportion of recurring revenues. Organic revenues have shown modest declines however, and the company effectively relies on acquisitions to grow. The company is expected to use its free cash flow to fund acquisitions and occasionally use debt to supplement internally generated cash Liquidity is expected to be good driven by a $15 million in cash on hand, an undrawn $25 million revolver and expectation of over $50 million in free cash flow over the next year. Affirmations: Issuer: Rocket Software, Inc Corporate Family Rating, Affirmed B2 Probability of Default Rating, Affirmed B2-PD Assignments: Issuer: Rocket Software, Inc First Lien Senior Secured Bank Credit Facilities, Assigned B1 (LGD3, 37%) Second Lien Senior Secured Bank Credit Facility, Assigned Caa1 (LGD5, 89 %) Outlook Actions: Issuer: Rocket Software, Inc Outlook, Revised to Negative from Stable Rocket Software Inc. is a provider of IT management software tools. The company, based in Waltham, MA, generated approximately $255 million in revenue in 2013. SABRE HOLDINGS: S&P Raises Corp. Credit Rating to 'B+' ------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Southlake, Texas-based travel technology companies Sabre Holdings Corp. and Sabre Inc. to 'B+' from 'B'. The outlook is stable. At the same time, S&P raised its issue-level rating on the company's senior secured debt to 'B+' from 'B'. The recovery rating on this debt remains '3', indicating S&P's expectation for meaningful (50%-70%) recovery for debt holders in the event of a payment default. S&P also raised its issue-level rating on the company's senior unsecured notes to 'B-' from 'CCC+'. The recovery rating on this debt remains '6', indicating S&P's expectation for negligible (0%- 10%) recovery for note holders in the event of a payment default. "The upgrade on Sabre Holdings Inc. reflects our expectation that leverage will improve to below 5x following the company's IPO and subsequent debt repayment," said Standard & Poor's credit analyst Andy Liu. Sabre plans to repay $320 million of its $800 million senior secured notes due 2019 and about $206 million of its term loan C due 2017. The rating also reflects some uncertainty regarding future restructuring charges, litigation outcome, and dividend growth. The rating reflects S&P's view of Sabre's business risk profile as "fair," based on the company's position as one of the largest global travel distribution systems (GDSs) and its fast growing software business. S&P views Sabre's financial risk profile as "aggressive" because of its expectation that by the end of 2014, leverage will improve to, and remain within, the 4x to 5x range. SAGITTARIUS RESTAURANTS: S&P Retains 'B' CCR Over Upsized Loan -------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings on U.S. restaurant operator and franchisor Sagittarius Restaurants LLC, including its 'B' corporate credit rating and 'B' issue-level rating on the company's first-lien term loan due 2018, are unchanged following the $10 million increase in the amount of the term loan add-on to $62 million. The outlook is stable. The total amount of the first-lien term loan is $220 million. The recovery rating on the credit facility remains unchanged at '3', indicating S&P's expectation for meaningful (50% to 70%) recovery for secured debt holders in the event of a payment default. The company will use proceeds from the term loan upsize to repay $62 million of payment-in-kind subordinated notes. S&P's rating reflects its view of the company's "weak" business profile and "highly leveraged" financial risk profile. In S&P's view, the company's "highly leveraged" financial risk profile assessment remains unchanged, as the proposed transaction is leverage neutral and modestly improves EBITDA interest coverage to around 2.2x from 1.7x in 2013. The current rating is predicated on S&P's expectation that credit metrics will modestly improve, but will remain within the "highly leveraged" financial risk profile over the next 24 months. RATINGS LIST Ratings Unchanged Sagittarius Restaurants LLC Corporate Credit Rating B/Stable/-- $220 mil. First-lien term loan due 2018 B Recovery rating 3 SEGA BIOFUELS: Deere Wants Court to Rescind Stay Relief Order ------------------------------------------------------------- Deere Credit, Inc., asks the U.S. Bankruptcy Court for the Southern District of Georgia to rescind the order granting stay relief and to reinstate consent order requiring Sega Biofuels, LLC, to cure default and to assume or reject lease. According to a court filing dated Dec. 19, 2013, Deere and the Debtor entered into a consent order requiring the Debtor to cure default and to assume or reject lease. The Consent Order contained a strict compliance provision. The Debtor was to pay $22,347.83 to Deere to catch up the arrearage by Jan. 20, 2014, and was to make all future payments in a timely manner in accordance with the lease agreement, with regular monthly payments to resume Jan. 9, 2014. Additionally, in order to provide assurance of future performance under the lease to Deere, the Debtor was to pay one additional month's lease payment to Deere in the amount of $3,849.99 by Jan. 20, 2014. After default by the Debtor, Deere obtained a court order granting relief from automatic stay. Since that time, the Debtor has made a substantial payment required under the previous Consent Order, namely, a payment in the amount of $26,197.82 was received by Deere on April 2, 2014, and Deere and the Debtor have agreed to request that the Court reinstate the Consent Order and to rescind the Order Granting Stay Relief. Deere is represented by: Hugh T. Hunter, Esq. Hunter And Hunter, Attorneys At Law, P.C. 1115 South Main Street Sylvania, Georgia 30467 Tel: (912) 564-2092 About Sega Biofuels Sega Biofuels LLC, the owner of a wood-pellet plant in Nahunta, Georgia, filed a petition for Chapter 11 protection (Bankr. S.D. Ga. 13-50694) on Sept. 11 in Waycross, Georgia. The Company listed assets worth $10.6 million and debt totaling $13.7 million. The U.S. Trustee has not appointed an official committee in the Debtor's bankruptcy case. SEVEN SISTERS: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Seven Sisters Market Bistro, Inc. 270 Russell Street Hadley, MA 01035 Case No.: 14-30417 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Massachusetts (Springfield) Judge: Hon. Henry J. Boroff Debtor's Counsel: Jeffrey J. Cymrot, Esq. SASSOON AND CYMROT LLP 84 State St. Boston, MA 02109 Tel: (617) 720-0099 Email: jcymrot@sassooncymrot.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Paul Ciaglo, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. SHA-WASHINGTON: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: Specialty Hospital of Washington, LLC aka Specialty Hospital of Washington-Capitol Hill aka SHA-Washington 700 Constitution Ave., NE Washington, DE 20002 Case Number: 14-10935 Type of Business: Health Care Involuntary Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Delaware (Delaware) Judge: Hon. Brendan Linehan Shannon Petitioners' Counsel: Stephen W. Spence, Esq. PHILLIPS, GOLDMAN & SPENCE 1200 N. Broom Street Wilmington, DE 19806 Tel: 302 655-4200 Fax: 302-655-4210 Email: ss@pgslaw.com Alleged Debtor's petitioners: Petitioner Nature of Claim Claim Amount ---------- --------------- ------------ Capitol Hill Group Money Due $1,661,827 Theodore Shin, CFO 2052 W. Virginia Ave. NE Washington, DC 20002 CMH, Inc. d/b/a CroppMetcalfe Goods/Services $42,701 Rob Greenblatt, CMA Provided 8421 HIlltop Road Fairfax, VA 22031 JFW Services, LLC Goods/Services $134,550 James F. Washington, Jr., Provided Managing Member 7368 Battalion Drive Mechanicsville, VA 23116 J-don Enterprises, LLC Goods/Services $6,970 Donald Kelly, Managing Member Provided P.O. Box 262127 Plano, TX 75026 Amalgamated Capital Partners, LLP Services provided $5,000 George H. Lowe, Jr. 9913 Indian Queen Point Road Fort Washington, MD 20744 Metropolitan Medical Group, LLC Physician services $836,820 Manisha Singal, MD, Managing Director 704 Fitzhugh Way Alexandria, VA 22314 SIFCO S.A.: Brazilian Auto-Parts Maker Files Ch. 15 in New York --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Sifco SA, a maker of front axles and I-beams for trucks and buses, commenced a bankruptcy restructuring in Brazil on April 22 and on April 23 filed a Chapter 15 petition in U.S. Bankruptcy Court in New York. According to the report, the Jundiai, Sao Paulo-based company distributes products in the U.S. through Westport Axle Corp., which was a subsidiary until it was sold in late 2013. The petition shows assets of less than $500 million and debt exceeding $500 million, the report related. Liabilities include $75 million on senior secured notes with Bank of New York Mellon Corp. as agent, the report further related. The bonds are secured in part by an $8.5 million cash deposit intended for use if an interest payment is missed, the report said. The case is In re Sifco SA, 14-bk-11179, U.S. Bankruptcy Court, Southern District of New York (Manhattan). SIFCO S.A.: Chapter 15 Case Summary ----------------------------------- Chapter 15 Petitioner: Rubens Leite Chapter 15 Debtor: SIFCO S.A. Rubens Leite Av. Sao Paulo, n 479 Vila Progresso Sao Paulo, Brazil 12302 Chapter 15 Case No.: 14-11179 Type of Business: Producer of forged and precision machine parts for the automotive industry targeting predominantly the global truck and bus manufacturing markets. Chapter 15 Petition Date: April 23, 2014 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Hon. Robert E. Gerber Chapter 15 Foreign Representative's Counsel: William Heuer, Esq. James J. Vincequerra, Esq. DUANE MORRIS LLP 1540 Broadway New York, NY 10036-4086 Tel: (212) 692-1000 Fax: (212) 692-1020 Email: wheuer@duanemorris.com jvincequerra@duanemorris.com Estimated Assets: $100 million to $500 million Estimated Debts: $500 million to $1 billion SIGMA LABS: Pritchett Siler Raises Going Concern Doubt ------------------------------------------------------ Sigma Labs, Inc., had a net loss of $734,000 on $1.07 million of revenues in 2013, compared with a net loss of $686,000 on $986,000 of revenues in 2012, according to its latest Form 10-K filed with the U.S. Securities and Exchange Commission. Pritchett Siler & Hardy, P.C., expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred losses since inception and has not yet achieved profitable operations. The Company's balance sheet at Dec. 31, 2013, showed $1.42 million in total assets, $141,161 in total liabilities, and stockholders' equity of $1.28 million. A copy of the Form 10-K is available at: http://is.gd/b0NLEl Santa Fe, New Mexico-based Sigma Labs, Inc., specializes in the development and commercialization of novel and unique manufacturing and materials technologies. Since its inception, the Company has generated revenues primarily from consulting services it provides to third parties. SOCKET MOBILE: Had $620K Net Loss in 2013 ----------------------------------------- Socket Mobile Inc. had a net loss of $620,000 on $15.7 million of revenues in 2013, compared with a net loss of $3.3 million on $13.6 million of revenues in 2012, according to a filing with the U.S. Securities and Exchange Commission. Sadler, Gibb & Associates, LLC, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has recurring net losses, an accumulated deficit of $61.12 million, and a working capital deficit. The Company's balance sheet at Dec. 31, 2013, showed $8.1 million in total assets, $7.97 million in total liabilities, and a stockholders' deficit of $133,000. A copy of the Form 10-K is available at: http://is.gd/syo6sH Newark, Calif.-based Socket Mobile, Inc. (OTC: SCKT) is a producer of mobile handheld computers and barcode scanning products serving the business mobility markets. SPECIALTY HOSPITAL: Hit with Involuntary Ch. 11 ----------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Specialty Hospital of Washington LLC, the operator of two long-term acute-care hospitals in Washington, was the target of an involuntary Chapter 11 petition filed on April 23 in Delaware. According to the report, creditors with $2.7 million in claims filed the petition. The creditor with the largest claim, $1.7 million, is landlord Capital Hill Group, the report related. The second-largest is physician provider Metropolitan Medical Group LLC, owed $837,000, the report further related. The case is In re Specialty Hospital of Washington LLC, 14-bk- 10935, U.S. Bankruptcy Court, District of Delaware (Wilmington). SPIRE CORP: McGladrey LLP Again Raises Going Concern Doubt ---------------------------------------------------------- Spire Corporation had a net loss of $8.52 million on $14.58 million of revenues in 2013, compared with a net loss of $1.86 million on $22.11 million of revenues in 2012, according to the Company's Form 10-K filed with the U.S. Securities and Exchange Commission. McGladrey, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred an operating loss from continuing operations of $8.4 million and cash used in operating activities of continuing operations was $5.2 million. The Company's credit agreement with a bank is due to expire on April 30, 2014. McGladrey LLP also issued a going-concern qualification following the 2012 results. It noted that during the year ended Dec. 31, 2012, the Company incurred a loss from continuing operations of $4.8 million and continuing operating cash flows used $6.9 million in cash. It also pointed out that the credit agreements were due to expire on June 29, 2013. The Company's balance sheet at Dec. 31, 2013, showed $16.07 million in total assets, $16.78 million in total liabilities, and stockholders' deficit of $0.71 million. A copy of the Form 10-K is available at: http://is.gd/EYaFDI About Spire Corp Bedford, Massachusetts-based Spire Corporation currently develops, manufactures and markets customized turn-key solutions for the solar industry, including individual pieces of manufacturing equipment and full turn-key lines for cell and module production and testing. STATER BROS: Moody's Affirms 'B2' Corporate Family Rating --------------------------------------------------------- Moody's Investors Service affirmed Stater Bros. Holdings Inc's. Corporate Family Rating at B2 and its Probability of Default Rating at B2-PD. Moody's also assigned a B1 rating to Stater Bros. Markets proposed $150 million revolving credit facility, its proposed $275 million term loan A and its proposed $300 million term loan B. In addition, Moody's upgraded Stater's Speculative Grade Liquidity Rating to SGL-1 from SGL-2 and changed the ratings outlook to stable from negative. Upon closing of the transaction the Corporate Family Rating, Probability of Default Rating, and Speculative Grade Liquidity rating will be moved from Stater Bros. Holdings Inc. to Stater Bros. Markets. Proceeds from the proposed credit facilities along with balance sheet cash will be used to repay approximately $616 million of outstanding borrowings under the company's existing senior notes and term loan. Ratings are subject to satisfactory review of related documentation. "The change in outlook to stable is prompted by the improved liquidity and reduced interest expense as a result of the proposed transaction, the company's continuing growth in same store sales, and stabilization of gross margins", Moody's Senior Analyst Mickey Chadha stated. "As a result Moody's expect debt/EBITDA to improve to about 6.0 times in the next 12 months" Chadha further stated. Ratings Rationale Stater's B2 Corporate Family Rating reflects the company's weak credit metrics, relatively small size, modest operating margins, regional concentration and competition from larger and financially stronger companies such as Vons (Safeway), Albertsons, Ralphs (Kroger), Wal-Mart, Costco and Target . Given that economic conditions in southern California continue to remain weak and competition intense, business conditions will remain challenging and margin improvement could be difficult to achieve over the near-to-medium term. The ratings are supported by Stater's good market presence in a well penetrated market, positive free cash flow profile, and very good liquidity. The B1 rating on the secured bank facilities reflects the senior position the credit facilities represent within the company's liability structure and the significant amount of liabilities -- predominantly lease rejection claims and multi-employer pension liabilities -- that are subordinated to these facilities. The upgrade of the Speculative Grade Liquidity rating to SGL-1 from SGL-2 reflects Moody's view that Stater's liquidity over the following twelve months will be very good. The upgrade incorporates the interest cost benefit from the proposed financing and Moody's expectation that the company will fund all of its operations, including working capital and capital expenditures, from internal sources. The SGL-1 also reflects the expectation that the cushion under its financial maintenance covenants will be material. For Stater Bros. Holdings Inc. The following ratings are affirmed: Corporate Family Rating at B2 Probability of Default rating at B2-PD The following ratings are affirmed at will be withdrawn at closing: $285 million senior unsecured notes due 2015 at B2 (LGD 3, 44%) $255 million senior unsecured notes due 2018 at B2 (LGD 3, 44%) The following ratings are upgraded: Speculative Grade Liquidity Rating at SGL-1 from SGL-2 For Stater Bros. Markets The following ratings are assigned: $150 million senior secured Revolving Credit Facility due 2019 at B1 (LGD3, 33%) $275 million senior secured Term Loan A due 2019 at B1 (LGD3, 33%) $300 million senior secured Term Loan B due 2021 at B1 (LGD3, 33%) The stable outlook reflects Moody's expectation that the company's operating performance particularly profit margins and liquidity will not deteriorate and credit metrics will remain consistent with the B2 rating category. The ratings could be downgraded if Stater's liquidity weakens or the company fails to stabilize or improve operating margins such that debt/EBITDA does not demonstrate meaningful progress towards 6.0 times. Ratings could also be downgraded if EBITA/interest expense is sustained below 1.5 times for an extended period of time. A shift towards an aggressive financial policy could also pressure ratings. The ratings could be upgraded if same store sales continue to be positive and Stater's operating margins and credit metrics demonstrate improving trends while it generates positive free cash flow and maintains very good liquidity. Quantitatively, an upgrade would require debt/EBITDA to demonstrate improvement towards 5.0 times and EBITA/interest expense sustained above 2.0 times. The principal methodology used in this rating was the Global Retail Industry published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. STATER BROS: S&P Affirms 'B+' CCR & Revises Outlook to Stable ------------------------------------------------------------- Standard & Poor's Ratings Services affirmed the 'B+' corporate credit rating on Stater Bros. Holdings Inc. At the same time, S&P revised its rating outlook on the company to stable from negative. S&P also assigned a 'B+' issue-level rating to the company proposed $725 million credit facility, which consists of a $150 million revolving credit facility, $275 million term loan A, and a $300 million term loan B. "The outlook revision follows the company's improved operating trends in its first quarter (ended Dec. 29, 2013). This improvement was a result of operating margin expansion and the refinancing transaction that enhances credit protection measures as it reduces debt moderately, but substantially lowers the company's interest costs," said credit analyst Charles Pinson- Rose. "The lower interest costs and longer term maturities will enable the company to generate greater free cash flow or make greater capital investments in the future, which could both be credit accretive. The ratings on Stater Bros. Holdings Inc. reflect Standard & Poor's Ratings Services' view of the company's business risk profile as "weak" and its financial risk profile as "aggressive"." The rating outlook is stable. This incorporates S&P's view that the company's operating trends should improve over the next year as a result of better operating margins. Furthermore, while there has been some operational volatility at the company, S&P believes Stater has a long history of moderately improving its market position and has generally maintained leverage ratios in a relatively narrow range. Downside scenario S&P would likely lower its rating by one notch if it revised its financial risk profile to "highly leveraged" from "aggressive". S&P would do so if the company maintained FFO to debt below 12% and leverage in the high-5x area. If unadjusted EBITDA was in the $150 million range, about 10% lower than S&P's expectations for 2014, and it expects the company to take actions to improve its financial risk profile, S&P would likely lower the corporate credit rating by one notch. Upside scenario If the company could improve credit metrics such that leverage was in the mid-4x range and FFO to debt was near 16% to 17%, S&P may consider raising the corporate credit rating to one notch to 'BB-', as a result of having a favorable comparable ratings analysis (CRA). However, this would mean unadjusted EBITDA would need to be in the $200 million to $210 million range, which is well beyond S&P's expected performance scenario over the near term. S&P currently believes the company's business is at the higher range of the "weak" business risk category, but core leverage ratios of debt to EBITDA and FFO to debt place the company at the lower end of the "aggressive" financial risk category. With that improvement, Stater would have core ratios that are solidly in the "aggressive" financial risk category and could warrant a revision of the CRA to positive. TCH-2 HOLDINGS: S&P Assigns 'B-' CCR on Private Equity Acquisition ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned New York City-based TCH-2 Holdings LLC, the holding company created to acquire TravelClick Inc., a 'B-' corporate credit rating. The outlook is stable. At the same time, S&P assigned the company's proposed $385 million senior secured first-lien term loan due 2021 and $30 million revolving credit facility due 2019 a 'B-' issue-level rating, with a recovery rating of '3', indicating S&P's expectation for meaningful (50% to 70%) recovery in the event of a payment default. S&P also assigned the company's proposed $175 million second-lien term loan due 2021 a 'CCC' issue-level rating, with a recovery rating of '6', indicating S&P's expectation for negligible (0% to 10%) recovery in the event of a payment default. S&P will withdraw its ratings on TravelClick Inc. and its debt following the close of the transaction. The ratings on TCH-2 Holdings reflect the company's "highly leveraged" financial risk profile, with pro forma leverage that S&P expects will decline to about 9x in 2014, treating capitalized software development as an operating expense. The ratings also reflect the company's "weak" business risk profile, given its modest scale and concentrated exposure to the lodging industry. S&P expects the company to generate positive FOCF in 2014 and for liquidity to remain adequate, although execution risk associated with its cost reduction plan could result in the company underperforming its expectations. TravelClick provides e-commerce solutions to independent and chain hotels. The company's reservation solutions allow its users to manage inventory and pricing, and provide distribution to more than 800 online travel agents globally. Its digital marketing solutions create hotel advertisements that target travel agents and consumers, and the company's business intelligence solutions offer market insights to hoteliers. TravelClick's digital marketing and business intelligence offerings result from its data-sharing relationships with its hotelier customers and the global distribution system (GDS) platforms used by the vast majority of travel agents. S&P believes this allows the company to maintain a differentiated competitive position in these niche segments of the travel industry. The current rating incorporates S&P's assumption that the company will preserve its contractual agreements with the GDS providers. TNI BIOTECH: Turner Stone Expresses Going Concern Doubt ------------------------------------------------------- TNI BioTech, Inc., had a net loss of $106.06 million on $nil of revenues in 2013, compared with a net loss of $174.99 million on $nil of revenues in 2012, according to the Company's Form 10-K filed with the U.S. Securities and Exchange Commission. Turner Stone & Company, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has suffered recurring losses from operations since inception and has a working capital deficiency. The Company's balance sheet at Dec. 31, 2013, showed $19.19 million in total assets, $2.56 million in total liabilities, and stockholders' equity of $16.63 million. A copy of the Form 10-K is available at: http://is.gd/prFNaA TNI BioTech, Inc., develops a range of adoptive and active forms of immunotherapies to treat cancer, HIV/AIDs and other autoimmune diseases. The Company has recently developed IRT-103 low-dose naltroxene (LDN), an active immunotherapy to cure tumor cells and HIV/AIDS. TRISTAR WELLNESS: Incurs $12.6 Million Net Loss in 2013 ------------------------------------------------------- Tristar Wellness Solutions, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $12.62 million on $3.77 million of sales revenues for the year ended Dec. 31, 2013, as compared with a net loss of $2.24 million on $0 of sales revenue in 2012. The Company's balance sheet at Dec. 31, 2013, showed $5.55 million in total assets, $9.18 million in total liabilities and a $3.63 million total stockholders' deficit. M&K CPAS, PLLC, in Houston, TX, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has suffered reoccurring losses from operations, and has an accumulated deficit and working capital deficit as of Dec. 31, 2013. These conditions raise substantial doubt about its ability to continue as a going concern. A copy of the Form 10-K is available for free at: http://is.gd/Faz1Gx About Tristar Westport Conn.-based Tristar Wellness Solutions, Inc., is a company involved in developing, manufacturing and marketing HemCon Medical Technologies Inc.'s innovative wound care/infection control medical devices, as well as, developing, marketing and selling NorthStar Consumer Products, LLC's Beaute de Maman(TM) product line, which is a line of skincare and other products specifically targeted for pregnant women, as well as developing the Soft and Smooth Assets. In April 2012, the Company changed its name from "Biopack Environmental Solutions, Inc." to "Tristar Wellness Solutions, Inc." This name changes was effected by the agreement between the holders of its preferred stock, which account for the voting control of the company with Rockland Group, LLC, under which Rockland purchased shares of TriStar Wellness Solutions, Inc. UNITED AMERICAN: Files Form 10-KT, Reports $537K Income in 2013 --------------------------------------------------------------- United American Healthcare Corporation filed with the U.S. Securities and Exchange Commission a transition report on Form 10-KT for the fiscal year ended Dec. 31, 2013. The Board of Directors of the Company adopted resolutions to change the Company's fiscal year end to December 31. The Company disclosed a net loss of $769,000 on $3.23 million of contract manufacturing revenue for the six months ended Dec. 31, 2013, as compared with net income of $82,000 on $3.83 million of contract manufacturing revenue for the same period in 2012. For the year ended June 30, 2013, the Company reported net income of $537,000 on $8.48 million of contract manufacturing revenue as compared with a net loss of $1.86 million on $6.83 million of contract manufacturing revenue for the year ended June 30, 2012. As of Dec. 31, 2013, the Company had $15.19 million in total assets, $12.91 million in total liabilities and $2.27 million in total shareholders' equity. Bravos & Associates, CPA's, in Bloomingdale, Illinois, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company's liabilities and working capital raise substantial doubt about its ability to continue as a going concern. A copy of the Form 10-KT is available for free at: http://is.gd/HZpDft About United American Chicago-based United American Healthcare, through its wholly owned subsidiary Pulse Systems, LLC, provides contract manufacturing services to the medical device industry, with a focus on precision laser-cutting capabilities and the processing of thin-wall tubular metal components, sub-assemblies and implants, primarily in the cardiovascular market. USG CORP: Further Amends 2010 Credit Agreement with JPMorgan ------------------------------------------------------------ USG Corporation entered into a first amendment to its existing Third Amended and Restated Credit Agreement, dated as of Dec. 21, 2010, among the Corporation, the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and Bank of America, N.A., and Wells Fargo Bank, N.A., as Co-Syndication Agents, and to the Guarantee Agreement and the Security Agreement. The Amendment, among other things, (i) deleted the provisions providing for an early maturity date in the event the Corporation either (x) has not repaid or provided for the repayment of its outstanding 9.75 percent senior notes due 2014 by May 2, 2014, or (y) does not have at least $500 million in liquidity from May 2, 2014, until the repayment of the 2014 Notes, and (ii) revised the definition of "Borrowing Base" to add an additional reserve against the Borrowing Base in the amount of the unpaid principal balance of the 2014 Notes outstanding from time to time. The amounts so reserved will be available for borrowing (subject to the other terms of the Credit Agreement) to repay the 2014 Notes. As of April 17, 2014, $59 million in principal of the 2014 Notes remained outstanding. USG intends to repay the 2014 Notes with cash on hand on or before their maturity on Aug. 1, 2014. The Amendment was requested by the Corporation to provide it cash management flexibility, and the Amendment was unanimously approved by the participating lenders. A copy of the Amendment No. 1 dated as of April 17, 2014, to the Third Amended and Restated Credit Agreement is available for free at http://is.gd/pqcE9g On March 18, 2014, USG issued a notice of redemption to redeem on April 17, 2014, the remaining $75 million in aggregate principal amount of USG's outstanding 10% contingent convertible senior notes due 2018. The Notes called for redemption could either be (1) redeemed at a stated redemption price or (2) converted into shares of USG common stock. The holders of all $75 million in Notes called for redemption have elected to convert their Notes into shares of USG's common stock. Accordingly, as of April 15, 2014, USG has issued an additional 6,578,946 shares of its common stock in connection with the conversion of the Notes. About USG Corporation Based in Chicago, Ill., USG Corporation -- http://www.usg.com/-- through its subsidiaries, manufactures and distributes building materials producing a wide range of products for use in new residential, new nonresidential and repair and remodel construction, as well as products used in certain industrial processes. The company filed for Chapter 11 protection on June 25, 2001 (Bankr. Del. Case No. 01-02094). When the Debtors filed for protection from their creditors, they disclosed $3.252 billion in assets and $2.739 billion in liabilities. The Debtors emerged from bankruptcy protection on June 20, 2006. For the 12 months ended Dec. 31, 2012, the Company incurred a net loss of $125 million on $3.22 billion of net sales, as compared with a net loss of $390 million on $2.91 billion of net sales during the prior year. The Company's balance sheet at Sept. 30, 2013, showed $3.71 billion in total assets, $3.64 billion in total liabilities and $72 million total stockholders' equity including noncontrolling interest. * * * As reported by the TCR on March 12, 2014, Standard & Poor's Ratings Services raised its corporate credit rating on Chicago- based USG Corp. to 'B+' from 'B'. "The upgrade reflects our view that improving U.S. housing construction will allow for increased selling prices and higher volume in USG's gypsum and worldwide ceiling segments, through which USG will continue to improve its leverage to about 4.7x by the end of 2014, and to below 4.5x by the end of 2015," said Standard & Poor's credit analyst Maurice Austin. As reported by the TCR on Oct. 30, 2013, Moody's Investors Service upgraded USG Corp.'s Corporate Family Rating to B3 from Caa1. The upgrade reflects better than anticipated overall 3Q13 operating performance. In the Sept. 10, 2013, edition of the TCR, Fitch Ratings has upgraded the ratings of USG Corporation, including the company's Issuer Default Rating (IDR) to 'B' from 'B-'. The upgrade reflects USG's improving profitability and credit metrics this year and the expectation that this trend continues through at least 2014. USMART MOBILE: Incurs $13.8 Million Net Loss in 2013 ---------------------------------------------------- USmart Mobile Device Inc. filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $13.8 million on $72.2 million of net sales for the year ended Dec. 31, 2013, as compared with a net loss of $4.86 million on $161 million of net sales for the year ended Dec. 31, 2012. As of Dec. 31, 2013, the Company had $12.04 million in total assets, $27.14 million in total liabilities and a $15.10 million in total stockholders' deficit. Albert Wong & Co. LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company's financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. These factors raise substantial doubt about the Company's ability to continue as a going concern, the auditors said. A copy of the Form 10-K is available for free at: http://is.gd/FUhmhx About USmart Mobile Del.-based USmart Mobile, previously known as ACL Semiconductors Inc., is currently engaged in the production, manufacturing and distribution of smartphones, electronic products and components in Hong Kong Special Administrative Region and the People's Republic of China through its operating subsidiaries. VALHALLA PROPERTY: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Valhalla Property Enterprise, LLC 270 Russell Street Hadley, m 01035 Case No.: 14-30419 Chapter 11 Petition Date: April 23, 2014 Court: United States Bankruptcy Court District of Massachusetts (Springfield) Judge: Hon. Henry J. Boroff Debtor's Counsel: Jeffrey J. Cymrot, Esq. SASSOON AND CYMROT LLP 84 State St. Boston, MA 02109 Tel: (617) 720-0099 Email: jcymrot@sassooncymrot.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Paul Ciaglo, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. VERTELLUS SPECIALTIES: Moody's Changes Caa1 Outlook to Positive --------------------------------------------------------------- Moody's Investors Service changed Vertellus Specialties Inc.'s (Vertellus, Caa1) outlook to positive from stable. This action reflects the sequential improvements in operating performance over the last three quarters along with the prospect of a continuation of favorable performance. Key drivers for the positive outlook include the improved operating performance, margin gains, sales volume growth, and improved free cash flow generation. "We expect Vertellus' operating performance to continue to progress in 2014 supporting the positive outlook and generating further improvements to the credit metrics and liquidity," said Lori Harris, Moody's Analyst. Ratings Rationale Vertellus' Caa1 Corporate Family Rating (CFR) reflects leverage of 6.4x (at December 31, 2013), a high level of debt relative to the companies size, and meaningful reliance on the revolver. The companies relatively small size, exposure to volatile raw materials costs, competitive pressure in several markets, lack of visibility in end-markets, and spending on legal / environmental settlements constrain the rating. Benefiting the company are its position as a diversified business of niche chemistries as well as leading market positions in pyridines and vitamin B3. Additionally, the completion of a majority of planned growth spending has benefited free cash flow generation and the liquidity position. The improved raw materials pricing environment has also helped margins recently. Vertellus' decision to close its high cost Antwerp facility will benefit the rating over the longer term, following completion of this event. Furthermore, the announced agreement to sell the Biomaterials business for $26 million is expected to be favorable to the ratings as the company has committed publicly to use the proceeds from the sale to reduce debt. (All ratios include Moody's Standard adjustments which add $21 million for Pension obligations and $31 million for the capitalization of operating leases, these adjustments also favorably impact EBITDA by $2 million and $5 million respectively.) Moody's positive outlook reflects the improved operating performance realized in 2013 and expected continuation of favorable operating results from improved volumes, reduced capex, and a more favorable raw materials environment. If Vertellus reduces debt with funds from the successful sale of the Biomaterials business, decreases leverage to near 6x, and continues to generate positive free cash flow, Moody's would likely raise the CFR to B3. Additionally, the higher rating would be contingent upon the company's ability to refinance its revolving credit facility and notes due 2015. The refinancing of the debt should provide a meaningful reduction in interest costs. Ratings Affirmed: Vertellus Specialties Inc. Corporate Family Rating -- Caa1 Probability of Default Rating -- Caa1-PD $100 million Asset Based Revolving Credit Facilities due March 31, 2015 -- B1 (LGD1, 8%) from B1 (LGD2, 20%) $345 million Senior Secured Notes due October 1, 2015 -- Caa1 (LGD4, 54%) from Caa1 (LGD4, 52%) Outlook - Positive Vertellus Specialties Inc. (Vertellus), a private company controlled by private equity firm Wind Point Partners, is a leading global manufacturer of pyridine and picoline derivative chemicals and producer of renewable chemistries for plastics and coatings, high performance additives for medical and plastics applications, and complex intermediates for pharmaceutical and agriculture customers. Vertellus offers a broad array of products to a diverse range of customers in seven target markets: agricultural, nutrition, personal care, industrial specialties, polymers and plastics, pharmaceutical and medical, and coatings, adhesives, sealants and elastomers. Headquartered in Indianapolis, Indiana, the company has operating facilities in the U.S., the United Kingdom, Belgium, India and China. Revenues for the fiscal year ending December 31, 2013 were $571 million. The principal methodology used in this rating was the Global Chemical Industry Rating Methodology published in December 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. VIGGLE INC: Amends 2.1 Million Shares Prospectus ------------------------------------------------ Viggle Inc. filed with the U.S. Securities and Exchange Commission amendment no. 3 to its Form S-1 registration statement relating to the offering 2,127,660 shares of the Company' common stock. A copy of the document is available for free at http://is.gd/vCzJSq About Viggle New York City-based Viggle Inc. is a loyalty marketing company. The Company has developed a loyalty program for television that gives people real rewards for checking into the television shows they are watching on most mobile operating system. Viggle users can redeem their points in the app's rewards catalog for items such as movie tickets, music, or gift cards. Viggle incurred a net loss of $91.40 million on $13.90 million of revenues for the year ended June 30, 2013, as compared with a net loss of $96.51 million on $1.73 million of revenues during the prior year. As of Dec. 31, 2013, the Company had $60.63 million in total assets, $53.94 million in total liabilities, $37.71 million in series A convertible redeemable preferred stock, and a $31.02 million total stockholders' deficit. BDO USA, LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company has suffered recurring losses from operations and at June 30, 2013, has deficiencies in working capital and equity that raise substantial doubt about its ability to continue as a going concern. VUZIX CORP: Delays 2013 Annual Report with SEC ---------------------------------------------- Vuzix Corporation filed with the U.S. Securities and Exchange Commission a Notification of Late Filing on Form 12b-25 with respect to its annual report on Form 10-K for the year ended Dec. 31, 2013. The Company said it was unable to file its report on Form 10-K on or before the required due date because the compilation, dissemination and review of the information required to be presented in the Form 10-K for the relevant period has imposed time constraints that have rendered timely filing of the Form 10-K impracticable without undue hardship and expense to the Company. The Company undertakes the responsibility to file that report no later than 15 days after its original prescribed due date. About Vuzix Corporation Vuzix -- http://www.vuzix.com-- is a supplier of Video Eyewear products in the consumer, commercial and entertainment markets. The Company's products, personal display devices that offer users a portable high quality viewing experience, provide solutions for mobility, wearable displays and virtual and augmented reality. Vuzix holds 33 patents and 15 additional patents pending and numerous IP licenses in the Video Eyewear field. Founded in 1997, Vuzix is a public company with offices in Rochester, NY, Oxford, UK and Tokyo, Japan. As of Sept. 30, 2013, the Company had $4.53 million in total assets, $12.52 million in total liabilities and a $7.99 million total stockholders' deficit. "During the three and nine months ended September 30, 2013 and the years ended December 31, 2012 and 2011, we have has been unable to generate cash flows other than our recent asset sales, sufficient to support our operations and have been dependent on equity financings, term debt financings, revolving credit financing and the June 2012 asset sale. We will remain dependent on outside sources of funding until our results of operations provide positive cash flows. There can be no assurance that we will be able to generate cash from those sources in the future. Our independent auditors issued a going concern paragraph in their reports for the years ended December 31, 2012 and 2011. The accompanying financial statements have been prepared assuming that we will continue as a going concern," the Company said in the quarterly report for the period ended Sept. 30, 2013. WATERFORD GAMING: S&P Lowers ICR to 'CC' on Potential Default ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings, including its issuer credit rating, on Waterford Gaming LLC to 'CC' from 'CCC'. The outlook is negative. The downgrade reflects S&P's expectation that excess cash flow will not be sufficient to cover the remaining principal balance of Waterford Gaming's senior unsecured notes on or before the maturity date in less than six months. At March 2014, approximately 36% of the principal balance of the notes remain outstanding. In the 12 months ended March 31, 2014, S&P estimates that Mohegan Sun experienced a decline in gross revenues in the low-single-digit percentage area. Similarly, for Mohegan's fiscal year ending September 2014, S&P believes Mohegan Sun could experience gross revenue declines in the low-single-digit percentage area. Given S&P's forecast, it believes Waterford Gaming will have approximately 30% of the notes outstanding at maturity. In the event that the principal balance is not repaid at maturity, S&P would view it as an event of default under its criteria and S&P would lower the rating by one notch to 'D'. S&P's 'CC' issuer credit rating on Waterford Gaming reflects its assessment of the company's financial risk profile as "highly leveraged" and its assessment of the company's business risk profile as "vulnerable," according to its criteria. "Our assessment of Waterford Gaming's financial risk profile as highly leveraged reflects our expectation that it is unlikely to generate sufficient excess cash flow to repay its notes upon maturity in September 2014. Our assessment of Waterford Gaming's business risk profile as vulnerable reflects the company's reliance on Mohegan Sun Casino, a single property operated by the MTGA, for its cash flow. Waterford Gaming is a wholly owned subsidiary of Waterford Group LLC. Since Waterford Gaming is not a bankruptcy-remote entity, the ratings for this company also take into consideration the credit quality of its parent," S&P said. Waterford Gaming relies solely on distributions from Trading Cove Associates (TCA), a Connecticut-based general partnership that formerly managed the Mohegan Sun Casino in southeastern Connecticut, to service its debt obligations. Waterford Gaming holds 50% partnership interest in TCA, and Kerzner International Ltd. owns the other 50% partnership interest. TCA ceased managing the Mohegan Sun at the end of 1999, at which time it entered into a relinquishment agreement with MTGA, under which it receives 5% of Mohegan Sun's gross revenue (excluding those from Casino of the Wind) until the end of 2014. TCA was also involved with the development of Mohegan Sun's initial $1 billion expansion, completed in 2002. Under the agreement, payments flow from MTGA to TCA and then distributed to Kerzner and Waterford Gaming. Waterford Gaming receives its share of the payment after the operating expenses of TCA and also incurs some operating expenses, which are paid prior to debt service. The company's excess cash flow after interest payments is mandatorily swept to repay the notes. Under the supplemental indenture, Waterford Gaming must also offer to purchase the senior notes at par on a semiannual basis, utilizing 15% of the amount that would otherwise have been used to make quarterly tax distributions. Additionally, TCA will receive two additional relinquishment payments to be used for debt repayment after the maturity date of the notes, with the final payment anticipated to be received in January 2015. WESTMORELAND COAL: Jeffrey Gendell Stake at 10.4% as of March 18 ---------------------------------------------------------------- In an amended Schedule 13D filed with the U.S. Securities and Exchange Commission, Jeffrey L. Gendell and his affiliates disclosed that as of March 18, 2014, they beneficially owned 1,547,713 shares of common stock of Westmoreland Coal Company representing 10.4 percent of the shares outstanding. The reporting persons previously owned 1,722,713 shares at Nov. 18, 2013. A copy of the regulatory filing is available for free at: http://is.gd/TQoSuv About Westmoreland Coal Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest independent coal company in the United States. The Company's coal operations include coal mining in the Powder River Basin in Montana and lignite mining operations in Montana, North Dakota and Texas. Its power operations include ownership of the two-unit ROVA coal-fired power plant in North Carolina. Westmoreland Coal incurred a net loss applicable to common shareholders of $6.05 million on $674.68 million of revenues for the year ended Dec. 31, 2013, as compared with a net loss applicable to common shareholders of $8.58 million on $600.43 million of revenues during the prior year. The Company incurred a net loss applicable to common shareholders of $34.46 million in 2011. * * * As reported by the TCR on Nov. 6, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Englewood, Co.-based Westmoreland Coal Co. (WLB). to 'B-' from 'CCC+'. "The upgrade reflects our view that WLB is less vulnerable to default after successfully negotiating less restrictive covenant requirements for an unrated $110 million term loan due 2018," said credit analyst Gayle Bowerman. "Our assessment of WLB's business risk profile as 'vulnerable' and financial risk profile as 'highly leveraged' are unchanged. We also revised our liquidity score to 'adequate' based on the covenant relief and additional liquidity provided under the company's new $20 million asset-based loan (ABL) facility from 'less than adequate'." Westmoreland Coal carries a Caa1 corporate family rating from Moody's Investors Service. WPCS INTERNATIONAL: Chief Financial Officer J. Heater to Quit ------------------------------------------------------------- WPCS International Incorporated, on March 31, 2014, entered into a separation agreement with Joseph Heater, the Company's chief financial officer. Pursuant to the agreement, Mr. Heater will resign effective at the close of business on July 31, 2014, as the chief financial officer of the Company and from all officer and director positions with the Company's subsidiaries. The Company will pay Mr. Heater the sum of $250,000 by Dec. 31, 2014, which will be payable in five monthly installments of $41,666.67, payable on the first business day of each month from August through December 2014 and one final payment of $41,666.65 to be made on Dec. 31, 2014. In addition, Mr. Heater will receive a bonus of $35,000, to be paid on July 31, 2014. Mr. Heater will also receive medical and other insurance benefits through Dec. 31, 2014, under the applicable plans maintained by the Company. Further, subject to stockholder approval of a new equity compensation plan, the Company will grant Mr. Heater options to purchase 50,000 shares of common stock, which options will vest immediately upon issuance and will expire on Dec. 31, 2014. A copy of the Severance Agreement is available for free at: http://is.gd/59BqAJ Effective March 27, 2014, Harvey Kesner resigned as an independent director of the Company. In submitting his resignation, Mr. Kesner did not express any disagreement with the Company on any matter relating to the Company's operations, policies or practices. About WPCS International WPCS -- 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. As reported by the TCR on Feb. 7, 2014, WPCS appointed Marcum LLP as its new independent registered public accounting firm. CohnReznick LLP resigned on Dec. 20, 2013, The Company's former auditors, 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, 2013. 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. As of Jan. 31, 2014, the Company had $22.37 million in total assets and $15.18 million in total liabilities. WPCS INTERNATIONAL: Script of Earnings Call Available ----------------------------------------------------- WPCS International Incorporated held an earnings conference call to discuss its unaudited financial results for the third fiscal quarter ended Jan. 31, 2014, and a shareholder update on the Company's business activities. The script of the earnings conference call is available for free at http://is.gd/byIlRb About WPCS International WPCS -- 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. As reported by the TCR on Feb. 7, 2014, WPCS appointed Marcum LLP as its new independent registered public accounting firm. CohnReznick LLP resigned on Dec. 20, 2013, The Company's former auditors, 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, 2013. 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. As of Jan. 31, 2014, the Company had $22.37 million in total assets, $15.18 million in total liabilities and $7.19 million in total equity. YOU ON DEMAND: UHY LLP Expresses Going Concern Doubt ---------------------------------------------------- YOU On Demand Holdings, Inc., had a net loss of $7.89 million on $309,000 of revenues in 2013, compared with a net loss of $16.3 million on $1.7 million of revenues in 2012, according to a Form 10-K filing with the U.S. Securities and Exchange Commission. UHY, LLP, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has incurred significant losses during 2013 and 2012 and has relied on debt and equity financings to fund their operations. The Company's balance sheet at Dec. 31, 2013, showed $15.0 million in total assets, $10.05 million in total liabilities, convertible redeemable preferred stock of $5.48 million, and a stockholders' deficit of $536,000. A copy of the Form 10-K is available at: http://is.gd/LBSYXE New York, N.Y.-based YOU On Demand Holdings, Inc., operates in the Chinese media segment through its Chinese subsidiaries and variable interest entities: (1) a business which provides to cable providers both an integrated value-added service solution and platform for the delivery of pay-per-view ("PPV") and video on demand ("VOD") as well as enhanced premium content for cable providers and (2) a cable broadband business based in the Jinan region of China. ZALE CORP: Meeting to Consider Proposed Acquisition Set on May 29 ----------------------------------------------------------------- Zale Corporation has set May 29, 2014, at 8:00 a.m. local time, as the date for a special meeting of its stockholders to consider and vote on the previously announced proposed acquisition of Zale by Signet Jewelers Limited and certain other matters. The meeting will be held at the Company's principal executive offices, 901 West Walnut Hill Lane, Irving, Texas 75038. Zale stockholders of record as of the close of business on April 30, 2014, will be entitled to notice of, and to vote at, the special meeting. The proposed acquisition is subject to approval by Zale's stockholders and certain other customary closing conditions. About Zale Corporation Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) -- http://www.zalecorp.com/-- is a specialty retailer of diamonds and other jewelry products in North America, operating approximately 1,695 retail locations throughout the United States, Canada and Puerto Rico, as well as online. Zale Corporation's brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale also operates online at http://www.zales.com/, http://www.zalesoutlet.com/, http://www.gordonsjewelers.com/and http://www.pagoda.com/ Zale Corp reported a net loss of $27.30 million for the three months ended Oct. 31, 2013. Zale Corp disclosed net earnings of $10.01 million for the year ended July 31, 2013, as compared with a net loss of $27.31 million for the year ended July 31, 2012. The Company incurred a net loss of $112.30 million for the year ended July 31, 2011 and a net loss of $93.67 million for the year ended July 31, 2010. As of Oct. 31, 2013, Zale Corporation had $1.31 billion in total assets, $1.16 billion in total liabilities and $152.95 million in total stockholders' investment. ZOGENIX INC: James Breitmeyer Appointed as Director --------------------------------------------------- James B. Breitmeyer, M.D., Ph.D. accepted an appointment to fill a newly-created seat on Zogenix, Inc.'s Board of Directors, effective March 28, 2014. Based upon the recommendation of the Board's Nominating/Corporate Governance Committee, Dr. Breitmeyer was appointed as a Class II director, with an initial term expiring at the 2015 annual meeting of the Company's stockholders. Dr. Breitmeyer, 60, currently serves as the president of Bavarian Nordic, Inc., an international biotechnology company, and also serves as the executive vice president at Bavarian Nordic A/S, positions he has held since February 2013. He served as acting chief medical officer to the Company from August 2012 to February 2013. Dr. Breitmeyer served as executive vice president of development and chief medical officer of Cadence Pharmaceuticals, Inc., a biopharmaceutical company, from August 2006 to August 2012. He served as chief medical officer of Applied Molecular Evolution, Inc., a wholly-owned subsidiary of Eli Lilly and Company, a global pharmaceutical company, from December 2001 to August 2006. From 2000 to 2001, Dr. Breitmeyer served as the president and chief executive officer of the Harvard Clinical Research Institute. From 1991 to 2000, he held a variety of positions at Serono Laboratories Inc., a global biopharmaceutical company, including chief medical officer and senior vice president of Research and Development. Prior to Serono Laboratories, he served as a consultant to ImmunoGen, Inc., and held clinical and teaching positions at the Dana Farber Cancer Institute and Harvard Medical School. Dr. Breitmeyer holds a B.A. in Chemistry from the University of California, Santa Cruz, an M.D. and Ph.D. from Washington University School of Medicine, and is Board Certified in Internal Medicine and Oncology. In connection with his appointment to the Board, pursuant to the Company's independent director compensation policy, Dr. Breitmeyer has been granted an option to purchase 75,000 shares of the Company's common stock, which have an exercise price per share equal to $3.07, the fair market value of the Company's common stock on the date of grant. The options will vest over three years in thirty-six equal monthly installments, subject to his continuing service on the Board. Dr. Breitmeyer will also receive cash compensation for his service on the Board in accordance with the Company's independent director compensation policy, as such policy may be amended from time to time. There are no other arrangements or understandings between Dr. Breitmeyer and any other person pursuant to which he was selected to serve on the Board. About Zogenix Inc. Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and Emeryville, California, is a pharmaceutical company commercializing and developing products for the treatment of central nervous system disorders and pain. Zogenix incurred a net loss of $80.85 million on $33.01 million of total revenue for the year ended Dec. 31, 2013, as compared with a net loss of $47.38 million on $44.32 million of total revenue for the year ended Dec. 31, 2012. The Company's balance sheet at Dec. 31, 2013, showed $112.50 million in total assets, $94.07 million in total liabilities and $18.42 million in total stockholders' equity. Ernst & Young LLP, in San Diego, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company's recurring losses from operations and lack of sufficient working capital raise substantial doubt about its ability to continue as a going concern. * Bankruptcy Filings Down 11% for March 2014 -------------------------------------------- Bankruptcy filings for the 12-month period ending March 31, 2014, fell 11% when compared to bankruptcy filings for the 12-month period ending March 31, 2013, according to statistics released by the Administrative Office of the U.S. Courts. March 2013 bankruptcy filings totalled 1,170,324 compared to 1,038,280 bankruptcy cases filed in the 12-month period ending March 31, 2014. * BOOK REVIEW: A Legal History of Money in the United States, 1774-1970 ------------------------------------------------------------- Author: James Willard Hurst Publisher: Beard Books Paperback: US$34.95 Review by Gail Owens Hoelscher Order your personal copy today and one for a colleague at http://is.gd/x8Gesf This book chronicles the legal elements of the history of the system of money in the United States from 1774 to 1970. It originated as a series of lectures given by James Hurst at the University of Nebraska in 1973. Mr. Hurst is quick to say that he , as a historian of the law, took care in this book not to make his own judgments on matters outside the law. Rather, he conducted an exhaustive literature review of economics, economic history, and banking to recount the development of law over the operations of money. He attempted to "borrow the opinions of qualified specialists outside the law in order to provide a meaningful context in which to appraise what the law has done or failed to do." Mr. Hurst define money, for the purposes of this books, as "a distinct institutional instrument employed primarily in allocating scarce economic resources, mainly through government and market processes," and not shorthand for economic, social, or political power held through command of economic assets." From the beginning, public and legal policy in the U.S. centered on the definition of legitimate uses of both law affecting money, and allocation of power over money among official agencies, both federal and state. The foundations of monetary policy were laid between 1774 and 1788. Initially, individual state legislatures and the Continental Congress issued paper currency in the form of bills of credit. The Constitutional Convention later determined that ultimate control of the money supply should be at the federal level. Other issues were not clearly defined and were left to be determined by events. The author describes how law was used to create and maintain a system of money capable of servicing the flow of resource allocations in an economy of broadly dispersed public and private decision making. Law defined standard money units and made those units acceptable for use in conducting transactions. Over time, adjustment of the money supply was recognized as a legitimate concern of law. Private banks were delegated expansive monetary action powers throughout the 1900s and private markets for gold and silver were allowed to affect the money supply until 1933-34. Although the Federal Reserve Act was not aimed clearly at managing money for goals of major economic adjustment, it set precedents by devaluing the dollar and restricting the use of gold. Mr. Hurst devotes a large part of his book to key issues of monetary policy involving the distribution of power over money between the nation and the states, between legal and market processes, and among major agencies of the government. Until about 1860, all major branches of government shared in making monetary policy, with states playing a large role. Between 1908 and 1970, monetary policy became firmly centralized at the national level, and separation or powers questions arose between the Federal Reserve Board, the White House (The Council of Economic Advisors), and the Treasury. The book was an enormous undertaking and its research exhaustive. It includes 18 pages of sources cited and 90 pages of footnotes. Each era of American legal history is treated comprehensively. The book makes fascinating reading for those interested in the cause and effect relationship between legal processes and economic processes and t hose concerned with public administration and the separation of powers. James Willard Hurst (1910-1997) is widely regarded as the grandfather of American legal history. He graduated from Harvard Law School in 1935 and taught at the University of Wisconsin-Madison for 44 years. ********* 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 by e-mail. 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 the nation's bankruptcy courts. The list includes links to freely downloadable of these small-dollar petitions in Acrobat PDF documents. 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. ********* 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, 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 2014. 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 ***