/raid1/www/Hosts/bankrupt/TCR_Public/140627.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, June 27, 2014, Vol. 18, No. 177
Headlines
4L TECHNOLOGIES: Moody's Affirms 'B2' Corporate Family Rating
56 WALKER: MB Financial Defends Bid to Cap DDWWW's Legal Fees
AFFYMAX INC: Board Decides to Dissolve the Company
AMERICAN AIRLINES: Bankruptcy Advisers Seek $400MM for Fees
AMERICAN AMEX: Case Converted to Chapter 7
AMERICAN AMEX: Motion to Sell Substantially All Assets Denied
AMERICAN ENERGY: Moody's Assigns B2 CFR & Rates 1st Lien Debt Ba3
AMNEAL PHARMACEUTICALS: Moody's Affirms 'B2' Corp. Family Rating
AS SEEN ON TV: Allen Clary Quits as President and Director
ASHLEY STEWART: Amends Consulting Agreement With Gordon Brothers
BAXANO SURGICAL: Reports $9.11-Mil. Loss for Q1 Ended March 31
BELDEN INC: Moody's Affirms 'Ba2' Rating on $200MM Sub. Notes
BEVERLY BANCORP: Files Chapter 11 Plan
BREEZY PALMS: Case Summary & Largest Unsecured Creditor
BREVITY VENTURES: Meeting to Form Creditors' Panel on July 2
BS QUARRIES: Voluntary Chapter 11 Case Summary
C&S GROUP: Moody's Rates New $400MM Senior Secured Notes 'B1'
C&S WHOLESALE: S&P Rates $400MM Sr. Secured Notes 'BB'
C-MOTECH: Seeks U.S. Recognition of Korean Bankruptcy
CALYPTE BIOMEDICAL: Incurs $1.1 Million Net Loss in 2012
CASH STORE: Cease Trade Order Issued by the OSC
CIENA CORPORATION: Moody's Assigns 'B2' Corporate Family Rating
CLAUDE RESOURCES: Covenant Waiver Requires Strategic Review
CLEVER IMPORTS: Case Summary & 20 Largest Unsecured Creditors
CNH INDUSTRIAL: S&P Rates Proposed Sr. Unsecured Notes 'BB'
COLOR STAR: Exclusive Solicitation Period Extended to Aug. 12
CUE & LOPEZ: Plan Filed; Disclosure Statement Hearing on Aug. 6
CUNNINGHAM LINDSEY: Moody's Lowers Corp. Family Rating to 'B2'
DARA PETROLEUM: Chapter 11 Case Transferred to E.D. Calif.
DEJOUR ENERGY: Has C$2.98-Mil. Net Loss for First Quarter
DEWEY STRIP: Reorganization Plan Declared Effective June 18
EFUSION SERVICES: July 10 Deadline to File Reply in Dismissal Bid
EFUSION SERVICES: Files Schedules of Assets and Liabilities
EMPIRE RESORTS: Unit Amends Option Agreement with EPT Concord
ENDO INTERNATIONAL: S&P Affirms 'BB-' CCR & Alters Outlook to Neg.
ERICKSON INC: S&P Revises Outlook to Negative & Affirms 'B' CCR
ESTATE FINANCIAL: Bank of New York Mellon Gets Stay Relief
EWGS INTERMEDIARY: Can Use Cash Collateral Through July 31
EWGS INTERMEDIARY: Files Amended Joint Plan of Liquidation
FIRST PHILADELPHIA: 6501 NSR Wants Clarification on Plan Terms
FUSION TELECOMMUNICATIONS: Amends 8.4MM Shares Resale Prospectus
G-I HOLDINGS: 3d Cir. Allows U.S. Gypsum, Quigley to Pursue Claims
GARLOCK SEALING: July 15 Hearing Set for Bids to Access Files
GENERAL MOTORS: U.S. Prosecutors Issue Subpoenas in Probe
HANESBRANDS INC: DB Apparel Deal No Impact on Moody's 'B1' CFR
HAYDEL PROPERTIES: Has Until July 3 to Respond to Dismissal Bid
HILCORP ENERGY: Moody's Rates New Sr. Unsecured Notes 'Ba3'
HLX PLY HOLDINGS: S&P Assigns 'B' CCR & Rates $555MM Credit 'B'
HOSTESS BRANDS: Aug. 7 Bid Deadline Set for Headquarters Building
HOTEL OUTSOURCE: Reports $385K Net Loss in First Quarter
INRETAIL REAL: Fitch Assigns 'BB' IDR & Rates Unsec. Notes 'BB'
INTELLIGRATED INC: Moody's Rates $68MM 1st Lien Debt Add-on 'B2'
INT'L STEM CELL: Incurs $1.43-Mil. Net Loss in March 31 Quarter
JORDAN WESLEY: Case Summary & 5 Largest Unsecured Creditors
LHP HOSPITAL: S&P Lowers CCR to 'B-' & Removes From Watch Neg.
LV HARMON: Case Summary & 20 Largest Unsecured Creditors
M.A.R. REALTY: Plan Outline OK'd; Confirmation Hearing on July 9
MACKEYSER HOLDINGS: Meeting to Form Creditors' Panel on July 8
MAGNUM HUNTER: Moody's Affirms B3 CFR & Revises Outlook to Stable
MEDIA GENERAL: Moody's Says WHTM TV Deal No Impact on 'B1' CFR
METEX MFG: Bankr. Court Junks Ill. Tax Claim v. Predecessor
MOMENTIVE PERFORMANCE: Jefferies Approved as Investment Banker
MUSCLEPHARM CORP: Strengthens Retail Presence with GNC
NAUTILUS HOLDINGS: Meeting to Form Creditors' Panel on July 1
NAVISTAR INTERNATIONAL: Adopts Tax Asset Protection Plan
NAVISTAR INTERNATIONAL: Inks Agreement with Icahn Group
NAVISTAR INTERNATIONAL: Amends Settlement Pact with MHR
NGL ENERGY: Moody's Assigns B2 Rating on $350MM Sr. Secured Notes
NNN 3500 MAPLE 26: Seeks Combined Hearing on Admin. Claim Bids
NYTEX ENERGY: Sells 8 Million Shares to Cory Hall
PACIFIC GOLD: Asher Enterprises No Longer a Shareholder
PALM BEACH BREWERY: Glades Brewery's Chapter 11 Case Summary
PPL ENERGY: Moody's Lowers Senior Unsecured Rating to 'Ba1'
PLAYBOY ENTERPRISES: Moody's Withdraws 'B2' Corp. Family Rating
QOL MEDS: Moody's Assigns 'B2' CFR & Rates 1st Lien Debt 'B2'
REFCO PUBLIC: Plan Outline OK'd, Confirmation Hearing on Sept. 9
REVEL AC: Section 341(a) Meeting Scheduled for July 22
RJS POWER: S&P Assigns 'B+' ICR & Rates $1.25BB Sr. Notes 'BB-'
ROBSHIR PROPERTIES: Case Summary & 7 Top Unsecured Creditors
ROOMLINX INC: Posts $539K Net Loss in Q1 Ended March 31
ROSE ROCK: Moody's Assigns Ba3 CFR & Rates $350MM Unsec. Notes B1
SAN FERNANDO REDEVELOPMENT: S&P Affirms 'BB+' Rating on 2006 Bonds
SEARS METHODIST: U.S. Trustee Names 3-Member Creditors' Panel
SEARS METHODIST: Files List of 30 Largest Unsecured Creditors
SHERMAN INDUSTRY: Voluntary Chapter 11 Case Summary
SHILO INN: Hearing on Cash Collateral Use Set For July 1
SOURCE INTERLINK: Proposes Kirkland & Ellis as Counsel
STERLING BLUFF: Hearing on Plan Filing Extension Set For July 14
SUPREME LLC: Voluntary Chapter 11 Case Summary
SUSQUEHANNA BANCSHARES: Moody's Puts '(P)Ba2' Rating on Review
TEMPLAR ENERGY: 2nd Lien Loan Upsize No Impact on Moody's B3 CFR
TERRAFORM POWER: Moody's Assigns 'Ba3' Corporate Family Rating
TRANS-LUX CORP: Carlisle Buys $1-Mil. Worth of Common Shares
TRUE DRINKS: Incurs $3.6-Mil. Net Loss in March 31 Quarter
VALIDUS HOLDINGS: Moody's Affirms '(P)Ba1' Preferred Stock Rating
VERMILLION INC: Declassifies Board of Directors
WAVE SYSTEMS: Seven Directors Re-Elected to Board
YAMANA GOLD: S&P Assigns 'BB+' CCR & Revises Outlook to Positive
ZACK GROUP: Case Summary & 20 Largest Unsecured Creditors
* Action by Argentina Seems to Defy Judge's Order on Bond Payments
* Puerto Rico Governor Files Debt Enforcement & Recovery Bill
* American Stock Transfer Completes Purchase of Donlin Recano
* Gordon Novod to Head Grant & Eisenhofer's Bankruptcy Practice
* Rosenthal, Duignan Join Otterbourg's Banking & Finance Practice
* Vault.com Releases Law Practice Area Rankings for 2015
* BOOK REVIEW: The First Junk Bond: A Story of Corporate Boom
and Bust
*********
4L TECHNOLOGIES: Moody's Affirms 'B2' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service affirmed 4L Technologies Inc.'s B2
Corporate Family Rating ("CFR") and B2-PD Probability of Default
Rating ("PDR") following the planned $110 million add-on to the
existing first lien senior secured term loan. Concurrently,
Moody's affirmed the B2 ratings for the first lien senior secured
credit facility, consisting of a $65 million revolving credit
facility due 2019 and a $760 million term loan due 2020 (upsized
from $650 million). The rating outlook remains stable.
4L Tech plans to use the proceeds from the proposed $110 million
add-on issuance to finance the acquisition of a remanufacturer of
aftermarket toner cartridges, as well as pay related transaction
fees and expenses. LGD point estimates are subject to change and
all ratings are subject to the execution of the transaction as
currently proposed and Moody's review of final documentation.
The affirmation of the B2 CFR reflects Moody's view that while the
proposed transaction modestly increases 4L Tech's leverage (on a
pro-forma basis for the proposed acquisition and the May 2014
refinancing transaction) to approximately 4.8 times from 4.6 times
(as of March 31, 2014), it will not result in a material change in
the company's credit profile over the near term. While the
absolute amount of funded debt increases due to the proposed debt
issuance, 4L Tech's track record of integrating acquisitions,
leads us to believe that the acquisition will be credit accretive
(after including synergies) over the next 12 to 18 months.
From a strategic perspective, the proposed acquisition increases
4L Tech's exposure ( by adding scale) to the remanufactured color
laser cartridges segment (revenues in this segment are expected to
grow at a faster rate -- on an industry wide basis -- than the
mono laser cartridge segment), and further diversifies its
existing client portfolio in the imaging segment, consisting of
strategic and mid-market customers, by adding a complementary set
of mid-market clients with minimal geographic overlap.
The following ratings were affirmed:
4L Technologies Inc.
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
$65 million first lien senior secured revolving credit facility
due 2019 at B2 (LGD4, 51%)
$760 million (upsized from $650 million) first lien senior
secured term loan B due 2020 at B2 (LGD4, 51%)
The rating outlook is stable.
Ratings Rationale
The B2 corporate family rating primarily considers 4L Tech's
elevated pro forma leverage of about 4.8 times, in the context of
the company's high business risk reflected in its focus on
remanufacturing and repair services for electronic assets across
narrow product segments consisting of imaging supplies, wireless
devices and telecom equipment. The rating is also constrained by
event risk in the form of any potential loss of key customer
contracts (especially on the wireless side) and a high degree of
execution risk as arguably future cash flows are highly dependent
on the continued availability and collection of used electronic
assets or "raw materials" through diverse channels. Furthermore,
the rating reflects 4L Tech's significant albeit modestly
improving customer concentration within the aforementioned product
categories, modest free cash flow generation, increasing
competition, continued acquisition risk and potential for
additional dividends given private equity ownership. Positive
ratings consideration is given to 4L Tech's market position as a
provider of remanufactured printer cartridges, contracts to repair
and refurbish a broad range of handsets for a growing list of
wireless carriers, long term relationships with key, strategic
customers, as well as cost and capability advantages afforded by
vertical integration across used electronic asset supply chains.
The stable outlook is based on Moody's expectation that 4L Tech
will sustain organic growth trends across its imaging, wireless
and telecom segments, while diversifying its product and customer
base, resulting in positive free cash flow and adequate liquidity.
The ratings could be upgraded if 4L Tech organically grows its
earnings such that debt to EBITDA sustains below 3.0 times and
EBIT to Interest Expense remains above 2.5 times. An upgrade would
also require a much higher level of customer and product segment
diversification, as well as commitment to conservative financial
policies with regards to shareholder enhancement initiatives and
large, debt funded acquisitions.
The ratings could be downgraded if operating performance erosion,
loss of a key customer or debt-financed acquisition/dividend
results in debt to EBITDA sustained above 5.0 times or EBIT to
interest expense falling below 1.25 times. Any material
deterioration in the company's liquidity profile could also lead
to a lower rating.
4L Technologies Inc. ("4L Tech") collects, remanufactures and
distributes inkjet and laser printer cartridges, wireless devices
and telecom equipment through its network of 70 locations in North
America, Europe and Asia. The company's main customers include
leading office product retailers and wireless carriers in the
United States. The company is private and is majority owned by
Golden Gate Capital.
The principal methodology used in this rating was Global
Distribution & Supply Chain Services published in November 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.
56 WALKER: MB Financial Defends Bid to Cap DDWWW's Legal Fees
-------------------------------------------------------------
MB Financial Bank, N.A., replied to the objections of 56 Walker
LLC, and Dickerson and Tomaselli, LLC to the proposed order fixing
and allowing secured claims and authorizing distributions under
the Debtor's Third Amended Liquidating Plan.
MB Financial filed and served the proposed order on May 8, 2014,
at the direction of the Court in its memorandum of decision dated
March 25. The memorandum of decision, among other things,
overruled the objections of the Debtor and Tomaselli to MB
Financial's proof of claim. In the Decision, the Court directed
MB Financial to settle an order providing for a proposed
distribution of funds held in escrow following the sale of the
Debtor's property.
According to MB Financial, the Debtor's contention that the
proposed order cannot be entered because it improperly caps the
fees and expenses of the Debtor's counsel Delbello Donnellan
Weingarten Wise & Wiederkehr, LLP (DDWWW) at $250,000 is without
merit. All of the sale proceeds are subject to MB Financial's
first priority lien well as the asserted mechanic's liens of
Lombardi and VCD. As such, the case is administratively insolvent
and any payments made to administrative expense claimants have and
will be made only on account of MB Financial agreeing to provide a
carve-out from its lien.
MB Financial also noted that DDWWW has been paid $100,000 from the
sale proceeds with MB Financial's consent pursuant to the terms of
the Court's order, dated April 9, 2014.
According to several docket entries, the Court set and adjourned
hearing to consider MB Financial's proposed order and oppositions
thereto.
On May 21, 2014, the Debtor objected to the MB Financial's motion,
stating that the proposed order contravenes certain provisions of
the Debtor's confirmed Plan and usurps the Debtor's rights with
respect to pending objections to claims. Moreover, the proposed
order is premature due to the unresolved status of the $1,700,000
escrow, agreed to by the Debtor, the purchaser of the property and
approved by MB, relating to an insurance loss at the property just
prior to the closing on the sale.
The Debtor is represented by:
Jonathan S. Pasternak, Esq.
Erica Feynman Aisner, Esq.
DELBELLO DONNELLANWEINGARGEN WISE & WIEDERKEHR, LLP
One North Lexington Avenue
White Plains, NY 10601
Tel: (914) 681-0200
MB Financial Bank is represented by:
Jeff J. Friedman, Esq.
Matthew W. Olsen, Esq.
KATTEN MUCHIN ROSENMAN LLP
575 Madison Avenue
New York, NY 10022-2585
Tel: (212) 940-8800
Fax: (212) 940-8776
About 56 Walker LLC
56 Walker LLC, the owner of a six-story building at 56 Walker
Street in the Tribeca section of Manhattan, returned to Chapter 11
(Bankr. S.D.N.Y. Case No. 13-11571) on May 13, 2013, this time
aiming for a $23 million sale to pay off about $14 million in
mortgages and $2 million in unsecured debt. The Debtor scheduled
assets of $23,000,000 and liabilities of $15,996,104.
Judge Shelley Chapman was initially assigned to the case but the
case was transferred to Judge Allan L. Gropper. Erica Feynman
Aisner, Esq., at Delbello Donnellan Weingarten Wise & Wiederkehr,
LLP, serves as the Debtor's counsel.
The previous Chapter 11 case began in September 2011 and was
dismissed in August 2012 when the bankruptcy judge refused to
approve a settlement.
On Jan. 29, 2014, Judge Allan L. Gropper of the U.S. Bankruptcy
Court for the Southern District of New York confirmed the Debtor's
Third Amended Liquidating Chapter 11 Plan, which contemplates the
sale of the Debtor's building at 56 Walker Street in the Tribeca
section of Manhattan for $18 million.
AFFYMAX INC: Board Decides to Dissolve the Company
--------------------------------------------------
Affymax, Inc., said that its Board of Directors has approved the
liquidation and dissolution of the company, subject to stockholder
approval, and plans to distribute all available cash to its
stockholders as soon as legally permitted and reasonably
practicable after paying or making reasonable provision for all
known and potential liabilities and other obligations of the
Company. Based on the information the Company currently has
available, which is subject to change, the Company estimates that
the aggregate amount of the distribution to stockholders could be
a few cents per share, based on 37,490,095 shares of common stock
outstanding as of April 30, 2014, and the remaining cash of
approximately $4 million as of May 2014.
The Company's Board of Directors has approved a plan of
liquidation and dissolution of the Company, which is subject to
stockholder approval. The Company intends to call a meeting of
its stockholders to seek approval of the dissolution and will file
proxy materials with the Securities and Exchange Commission as
soon as practicable.
This decision follows the recent joint announcement by the Company
and Takeda Pharmaceutical Company Limited (Takeda) that Takeda has
completed a detailed investigation of the postmarketing reports of
serious hypersensitivity reactions including anaphylaxis, which
may be life-threatening or fatal. As announced, Takeda confirmed
that no quality or manufacturing issues were present, but it was
not able to identify a specific root cause for the reactions that
were observed. In light of these findings, OMONTYS would not be
permitted to be returned to the market and Takeda is working with
the FDA to withdraw approval. Based on this outcome, the Board
has determined it to be in the best interests of the stockholders
to dissolve the Company.
The plan of liquidation and dissolution contemplates an orderly
wind down of the Company's remaining business and operations. If
the Company's stockholders approve the dissolution, the Company
intends to file a certificate of dissolution with the Delaware
Secretary of State, satisfy or resolve its remaining liabilities
and obligations, including but not limited to contingent
liabilities and claims, lease obligations, and costs associated
with the liquidation and dissolution, and make distributions to
its stockholders of cash available for distribution, subject to
applicable legal requirements. In order to conserve its available
resources and assets, the Company plans to seek relief from
certain of its reporting obligations under the Securities Exchange
Act of 1934, as amended and, upon the filing of the certificate of
dissolution, the Company also intends to cease trading in its
stock on the public markets, close its stock transfer books and
discontinue recording transfers of shares of its stock.
Subject to claims that may be presented to the Company as part of
the dissolution process, the Company currently estimates that it
will maintain an initial reserve for any contingent and unknown
obligations and liabilities, in accordance with applicable law
until the resolution of those matters. Any remaining cash is
expected to be distributed to stockholders as soon as reasonably
practicable and permitted by applicable law. The amount
distributable to stockholders, however, may vary substantially
from the amount estimated above based on a number of factors,
including the resolution of outstanding known and contingent
liabilities, the possible assertion of claims currently unknown to
the Company, and costs incurred to wind down the Company's
business. If additional amounts are ultimately determined to be
necessary to satisfy any of these obligations, stockholders may
receive no distributions or amounts substantially less than the
Company's current estimate.
If, prior to its dissolution, the Company receives an offer for a
transaction that will, in the view of the Board, provide superior
value to stockholders compared to the value of the estimated
distributions under the plan of liquidation and dissolution,
taking into account all factors that could affect valuation,
including timing and certainty of payment and closing, and
proposed terms and other factors, the plan of liquidation and
dissolution could be abandoned in favor of such a transaction.
The plan of liquidation also provides for an alternative procedure
in the event that the Company's Board later determines that an
assignment for the benefit of creditors under applicable state law
would be preferable to dissolution. In seeking stockholder
approval of the dissolution, the Company will also seek
stockholder approval of the alternative procedure of an assignment
for the benefit of creditors.
About Affymax
Affymax, Inc. (Nasdaq: AFFY) is a biopharmaceutical company based
in Palo Alto, California. In March 2012, the U.S. Food and Drug
Administration approved the Company's first and only product,
OMONTYS(R) (peginesatide) Injection for the treatment of anemia
due to chronic kidney disease in adult patients on dialysis.
OMONTYS is a synthetic, peptide-based erythropoiesis stimulating
agent, or ESA, designed to stimulate production of red blood cells
and has been the only once-monthly ESA available to the adult
dialysis patient population in the U.S. The Company co-
commercialized OMONTYS with its collaboration partner, Takeda
Pharmaceutical Company Limited, or Takeda during 2012 until
February 2013, when the Company and Takeda announced a nationwide
voluntary recall of OMONTYS as a result of safety concerns.
As of March 31, 2014, the Company had $6.46 million in total
assets, $8.79 million in total liabilities and a $2.33 million
total stockholders' deficit.
Bankruptcy Warning
"Because we have not made an irrevocable decision to liquidate,
the accompanying condensed financial statements have been prepared
under the assumption of a going concern basis that contemplates
the realization of assets and liabilities in the ordinary course
of business. Operating losses have been incurred each year since
inception, resulting in an accumulated deficit of $559.5 million
as of March 31, 2014. Nearly all of our revenues to date have
come from our collaboration with Takeda. As a result of the
February 23, 2013 nationwide voluntary recall of OMONTYS and the
suspension of all marketing activities, there is significant
uncertainty as to whether we will have sufficient existing cash to
fund our operations for the next 12 months. Given our limited
resources, there is no assurance that we will be able to reduce
our operating expenses enough to meet our existing and future
obligations and conduct ongoing operations. If we do not have
sufficient funds to continue operations, we could be required to
liquidate our assets, seek bankruptcy protection or other
alternatives. Any failure to dispel any continuing doubts about
our ability to continue as a going concern could adversely affect
our ability to enter into collaborative relationships with
business partners. These matters raise substantial doubt about
our ability to continue as a going concern. Our financial
statements do not include any adjustments that may result from the
outcome of this uncertainty," the Company said in the Quarterly
Report for the period ended March 31, 2014.
Affymax reported a net loss of $14.42 million in 2013 following a
net loss of $93.41 million in 2012.
Ernst & Young LLP, in Redwood City, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2013. The independent auditors noted
that there is significant uncertainty as to whether the Company
will have sufficient financial resources to fund its operations
for the next 12 months. This condition raises substantial doubt
about the Company's ability to continue as a going concern.
AMERICAN AIRLINES: Bankruptcy Advisers Seek $400MM for Fees
-----------------------------------------------------------
Sara Randazzo, writing for The Wall Street Journal, reported that
a fee examiner tasked with keeping costs down in the American
Airlines bankruptcy recommended that a court approve nearly $400
million in fees and expenses earned by professionals who he said
engineered "perhaps the most efficient airline reorganization case
on record."
According to the report, Robert Keach, an attorney from Maine,
made the request in a series of filings in U.S. Bankruptcy Court
in Manhattan. Mr. Keach recommended paying $371.7 million in fees
and $16.3 million in expenses to 47 professional firms, including
lawyers, accountants, aircraft consultants and other advisers, the
report related.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines filed
for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463)
in Manhattan on Nov. 29, 2011, after failing to secure cost-
cutting labor agreements. AMR, previously the world's largest
airline prior to mergers by other airlines, is the last of the so-
called U.S. legacy airlines to seek court protection from
creditors. It was the third largest airline in the United States
at the time of the bankruptcy filing.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion.
The bankruptcy judge on Sept. 12, 2013, confirmed AMR Corp.'s plan
to exit bankruptcy through a merger with US Airways. By
distributing stock in the merged airlines, the plan is designed to
pay all creditors in full, with interest.
Judge Sean Lane confirmed the Plan despite the lawsuit filed by
the U.S. Department of Justice and several states' attorney
general complaining that the merger violates antitrust laws.
In November 2013, AMR and the U.S. Justice Department a settlement
of the anti-trust suit. The settlements require the airlines to
shed 104 slots at Reagan National Airport in Washington and 34 at
LaGuardia Airport in New York.
AMR stepped out of Chapter 11 protection after its $17 billion
merger with US Airways was formally completed on Dec. 9, 2013.
AMERICAN AMEX: Case Converted to Chapter 7
------------------------------------------
The Bankruptcy Court, on June 19, 2014, granted the motion of the
U.S. Trustee to convert the Chapter 11 case of American Amex,
Inc., to one under Chapter 7 of the Bankruptcy Code.
The Trustee requested that the Court dismiss the case, or in the
alternative, convert the case to Chapter 7.
The Court in its order said that the case conversion will take
effect in 60 days.
In this connection, the Court directed the Debtor's counsel D.
Blair Clark, Esq., at Law Office of D. Blair Clark, PLLC, to
prepare a sale order, and when the sale is closed, to submit a
notice immediately.
The Debtor filed a supplemental opposition to the U.S. Trustee's
motion to dismiss or convert; motion for order shortening time for
hearing on motion to sell; supplemental opposition to motion for
relief from stay, stating, among other things:
1. the Chapter 11 Plan was confirmed, the property of the
Debtor was to be sold to Erwin Singh Braich, trustee of the
Peregrine Trust, and an order was entered by the Court approving
the terms of the sale;
2. Braich defaulted in the payments to be made, although the
Court made it clear to him repeatedly that he would have to obtain
court approval to close the sale, which would necessitate his
paying the consideration pursuant to the contract, he has failed
to do so. However, he is still advertising that he is the owner
of the property.
The Debtor submitted that no party will be prejudiced by the
Court's retention of the case as a chapter 11 case operating under
the Plan as confirmed.
As reported in the Troubled Company Reporter on May 20, 2014,
the Debtor, in response to U.S. Trustee Gail Brehm Geiger's motion
to dismiss or convert, stated it has corrected the mistakes done
by Ray Weilage, the Company's president and primary shareholder.
A current report has been filed and U.S. Trustee fees have been
made current.
Robert P. Hills, Jr., a secured creditor of the Debtor, also filed
a response, saying the consequence of dismissing the case would be
to effectively extinguish his mortgage lien. Mr. Hills said he
holds a second mortgage position on the sole asset comprising the
bankruptcy estate, subordinate only to the mortgage of Sable Palm
(and the statutory liens for taxes).
Freddy Busby Quimby, a creditor, also filed a separate motion for
case dismissal, and told the Court that Mr. Weilage, the Debtor's
president, is not authorized to do business in the State of
Oregon. The Oregon Secretary of State and the Nevada Secretary of
State revoked his business. He is not allowed to enter before a
Court by law.
About American Amex
American Amex, Inc., filed for Chapter 11 protection petition
(Bankr. D. Ore. Case No. 12-30656) on Feb. 1, 2012. The Law
Offices of D. Blair Clark PLLC has been tapped as counsel.
In its amended schedules, the Debtor disclosed $34,000,000 in
total assets and $10,490,026 in total liabilities.
The Debtor is the legal owner of a mine in Grant County, Oregon,
known historically as the "Buffalo Mine."
American Amex in December 2013 won confirmation of its sale-based
Chapter 11 plan. Under the Plan, all creditors are receiving full
payment from the proceeds from the sale of the Debtor's Buffalo
Mine.
AMERICAN AMEX: Motion to Sell Substantially All Assets Denied
-------------------------------------------------------------
Bankruptcy Judge Randall L. Dunn, at a June 19 hearing, denied
American Amex, Inc.'s motion to sell all or substantially all
assets.
The Debtor, in its motion, stated that it believed that the fair
market value of the property, based on the offers and discussions
with proposed purchasers, is $27 million, more or less.
The Debtor proposed a private sale and no competitive bids are
contemplated. The sale is in compliance with the confirmed
Chapter 11 Plan.
As reported in the Troubled Company Reporter on Feb. 14, 2014,
the Debtor filed a "report of status of sale" saying that
In December 2013, the Debtor won confirmation of its sale-based
Chapter 11 plan. Judge Dunn on Dec. 4, 2013, entered an order
confirming the Debtor's Second Amended Plan of Reorganization
dated Oct. 11, 2013, after noting that requisite classes of
creditors have voted in favor of confirmation, and all objections
have been resolved. Under the Plan, all creditors were to receive
full payment from the proceeds from the sale of the Debtor's
Buffalo Mine.
The confirmation order also approved the sale of the Buffalo Mine
property. The Debtor reached an agreement with Erwin Singh
Braich, Trustee of the Peregrine Trust, whereby Mr. Braich would
purchase the entire mine property. Should Braich not close, then
the property would be sold to the highest bidder. The Debtor
believes the sale of the Buffalo Mine should fetch at least $27
million, which is more than enough to pay all claims scheduled
and/or filed.
A copy of the Second Amended Disclosure Statement dated Oct. 11,
2013, is available at:
http://bankrupt.com/misc/AMERICAN_AMEX_2ds-1.pdf
Mr. Braich, however, has failed to close the sale according to the
deadline set by the Court.
About American Amex
American Amex, Inc., filed for Chapter 11 protection petition
(Bankr. D. Ore. Case No. 12-30656) on Feb. 1, 2012. The Law
Offices of D. Blair Clark PLLC has been tapped as counsel.
In its amended schedules, the Debtor disclosed $34,000,000 in
total assets and $10,490,026 in total liabilities.
The Debtor is the legal owner of a mine in Grant County, Oregon,
known historically as the "Buffalo Mine."
American Amex in December 2013 won confirmation of its sale-based
Chapter 11 plan. Under the Plan, all creditors are receiving full
payment from the proceeds from the sale of the Debtor's Buffalo
Mine.
AMERICAN ENERGY: Moody's Assigns B2 CFR & Rates 1st Lien Debt Ba3
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
(CFR) to American Energy-Marcellus, LLC (AEM). Moody's also
assigned a B2-PD Probability of Default Rating, a Ba3 rating to
its $750 million first-lien term loan and a Caa1 rating to its
$450 million second-lien term loan. The ratings outlook is stable.
The company is raising $1.2 billion of new debt to fund the
acquisition of approximately 48,000 net acres in the southern
Marcellus Shale of northern West Virginia from East Resources,
Inc. (unrated) and an unnamed private company for $1.275 billion.
The remainder of the acquisition will be financed with new sponsor
equity.
"American Energy-Marcellus, LLC has purchased promising Marcellus
shale acreage and has a compelling production growth trajectory"
commented Michael Somogyi, Moody's Vice President -- Senior
Analyst. "Nonetheless, the company's largely undeveloped reserve
base, natural gas concentrated production and execution risks in
implementing drilling plans serve to restrain the rating until the
company delivers on its development objectives."
Assignments:
Issuer: American Energy - Marcellus, LLC
Corporate Family Rating (CFR), Assigned B2
Probability of Default Rating (PD), Assigned B2-PD
Speculative Grade Liquidity Rating (SGL), Assigned SGL-3
Senior Secured First Lien Bank Credit Facility, Assigned Ba3,
29-LGD2
Senior Secured Second Lien Bank Credit Facility, Assigned Caa1,
84-LGD5
Outlook is stable
Ratings Rationale
The $750 million first-lien term loan is secured by a first
priority claim on substantially all of the company's assets. The
$450 million second-lien term loan is secured on a junior priority
basis by the same collateral that secures the first lien
obligations. Given the second lien term loan's structural
subordination to the first lien facility, the second lien term
loan is rated Caa1, two notches below the Corporate Family Rating
(CFR), whereas the first lien facility has a two-notch uplift from
the B2 CFR under Moody's Loss Given Default (LGD) Methodology.
The B2 Corporate Family Rating (CFR) reflects AEM's small scale,
early stage operations, largely undeveloped reserve base, natural
gas concentrated production in the Marcellus and the inherent
execution risks in implementing its drilling plans that will
result in an outspending of cash flow through 2016. The rating
also reflects the management team's strong, previous track record
and the de-risked nature of the company's acreage which provides
visible production and cash flow growth potential to support
deleveraging on a proved developed (PD) reserve and average daily
production basis.
AEM was formed in April 2014 to acquire assets concentrated in the
southern Marcellus Shale in northern West Virginia. This area has
been extensively de-risked by the industry and is characterized as
having limited geologic complexities. AEM's acreage position is
largely contiguous with 99% held by production and 99% operated.
AEM will have a total proved reserve base of approximately 145
million BOE post close of the acreage acquisitions with about 50
million BOE proved developed (PD). The vast majority of reserves
(73%) reside in the Marcellus wet gas region, another 25% in the
dry gas window and 2% in the shallow area of the play. Average
daily production for the second half of 2014 will be around 27,000
BOE, of which 65% is natural gas. Based on $1.2 billion of funded
debt, leverage on production and leverage on PD reserves will be
around $45,300 per BOE and $22.75 per PD reserve, respectively.
While current leverage metrics are high for the B2 CFR, Moody's
project AEM will grow production volumes to around 45,000 BOE per
day by year-end 2015 and to 86,000 BOE per day by year-end 2016 as
it executes its drilling and development program. The company is
currently running one rig and plans to accelerate its drilling
program to three rigs in 2015 and potentially 4 rigs in 2016. Well
spacing will be about 660 feet and lateral lengths will be 6,200
and 6,700 feet in the wet gas an dry gas windows, respectively,
with an average well cost of approximately $7.8 million. AEM plans
to drill 12 wells in 2014 and an additional 54 wells in 2015.
Development CAPEX will be approximately $80 million in 2014 and
jumps to $550 million in 2015 and will range between $400-$500
million in 2016 to support its drilling and development program,
resulting in capital outspend over this period. Moody's expect
reserve and production growth to support deleveraging efforts over
the next 18-24 months with leverage on production and leverage on
PD reserves approaching $26,800 per BOE and $15.25 per PD reserve,
respectively.
The SGL-3 rating reflects adequate liquidity. In conjunction with
the close of financing, AEM will deposit $300 million in proceeds
from the first-lien term Loan facility into a CAPEX Reserve
Account. These funds will solely be used for expenditures related
to the development of acquired oil and gas assets. This reserve
account serves as the company's primary form of liquidity as there
is no revolving credit facility currently in place. The reserve
account is subject to a 4.0x net secured leverage ratio covenant.
The first-lien term loan has a $275 million accordion feature
subject to a 3.5x First Lien leverage test and the second-lien
term loan has a $250 million accordion feature.
The outlook is stable. The primary catalyst for a rating upgrade
will be the company's successful execution of its drilling and
development program leading to significantly higher production and
proved developed reserves. If production growth and reserve adds
are achieved while maintaining debt/PD reserves below $12/ BOE and
retained cash flow/debt ratio approaching 30%, the ratings could
be upgraded. A ratings downgrade could be considered if the
company fails to meet its production targets and deleveraging is
subsequently slower than anticipated leading to debt/production
sustained above $30,000 BOE.
The principal methodology used in this rating was the Global
Independent Exploration and Production Industry Methodology
published in December 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.
American Energy - Marcellus, LLC, is an independent E&P company
with principal producing properties located in the Southern
Marcellus Shale of Northern West Virginia. American Energy
Marcellus, LLC is headquartered in Oklahoma City, Oklahoma.
AMNEAL PHARMACEUTICALS: Moody's Affirms 'B2' Corp. Family Rating
----------------------------------------------------------------
Moody's Investors Service affirmed the B2 Corporate Family Rating
and B2-PD Probability of Default Rating of Amneal Pharmaceuticals
LLC. Moody's also affirmed the B2 rating on the company's $493
million term loan, which includes a proposed incremental $80
million, the proceeds of which will be used to repay existing debt
and for other general corporate purposes. Moody's also changed the
outlook to positive from stable.
Ratings affirmed:
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
Senior secured term loan at B2 (LGD 4)
The outlook was changed to positive from stable.
Rating Rationale
The change in outlook to positive reflects Amneal's very strong
recent performance and Moody's expectation that its strong
pipeline of new products and heavy investment in R&D and
manufacturing capabilities will drive longer-term growth and
strengthen its competitive position.
The B2 Corporate Family Rating reflects Amneal's modest scale in
the highly competitive generic pharmaceutical industry. The B2
rating is also constrained by risks related to the very rapid
growth and the limited cash flow expected over the next couple of
years due to high expansion-related capital expenditures and
Amneal's high tax distributions. The rating is also constrained by
the expectation that the company will pay dividends to
shareholders in the future, which may result in increased leverage
from current levels.
The ratings are supported by Amneal's significant manufacturing
capacity in the US and India, its diverse dosage-form development
and manufacturing capabilities, including in-house active
pharmaceutical ingredient (API) production, as well as the
company's proven ability to launch and supply difficult-to-
manufacture products. The company has a significant portfolio of
new drugs on file with the FDA and in development that will drive
future growth. The ratings are also supported by the company's
strong quality track record and good liquidity.
Moody's could upgrade the ratings if Amneal continues to expand
revenue and EBITDA and improve product diversity through
successful execution of its growth strategy. An upgrade could be
considered if the company demonstrates a longer track record of
financial policies that include maintaining adjusted debt to
EBITDA around 4.0 times and the company is able to generate
consistently positive free cash flow despite ongoing investment in
R&D and growth capital expenditures.
The ratings could be downgraded if Moody's expects adjusted debt
to EBITDA to be sustained above 6.0 times. This could occur from
acquisitions, shareholder dividends or operating disruption from
supply issues or difficulty in getting new products approved and
launched. The weakening of liquidity due to an overly aggressive
growth strategy could also lead to a downgrade.
Amneal Pharmaceuticals LLC ("Amneal"), founded in 2002 and
headquartered in Bridgewater, NJ, is a generic pharmaceutical
manufacturer with facilities in New York, New Jersey, and India.
The company currently generates most of its revenue in the US but
is actively pursuing expansion into international generic markets.
Amneal recorded net revenue of $612 million for the twelve months
ended March 31, 2014. The company is majority owned by the
founders and principals of Amneal Pharmaceuticals and Tarsadia
Investments.
The principal methodology used in this rating was the Global
Pharmaceutical Industry published in December 2012. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
AS SEEN ON TV: Allen Clary Quits as President and Director
----------------------------------------------------------
Allen Clary resigned as president and director of As Seen On TV,
Inc., effective June 18, 2014. He also resigned as chief
operating officer of Infusion Brands International, Inc., the
Company's majority shareholder. Mr. Clary has not expressed any
disagreement with the Company on any matter relating to the
Company's operations, policies or practices.
About As Seen on TV
Clearwater, Fla.-based As Seen On TV, Inc., is a direct response
marketing company. It identifies, develops, and markets consumer
products.
As reported by the TCR on Nov. 6, 2012, As Seen On TV entered into
an Agreement and Plan of Merger with eDiets Acquisition Company
("Merger Sub"), eDiets.com, Inc., and certain other individuals.
Pursuant to the Merger Agreement, Merger Sub will merge with and
into eDiets.com, and eDiets.com will continue as the surviving
corporation and a wholly-owned subsidiary of the Company. The
Merger Agreement was completed on April 2, 2014.
The Company incurred a net loss of $9.32 million on $1.98 million
of revenues for the year ended March 31, 2014, as compared with
net income of $3.69 million on $9.40 million of revenues for the
year ended March 31, 2013. The Company's balance sheet at
March 31, 2014, showed $5.78 million in total assets, $3.58
million in total liabilities and $2.20 million in total
stockholders' equity.
EisnerAmper LLP, in Iselin, New Jersey, issued a "going concern"
qualification on the consolidated financial statements for the
year ended March 31, 2014. The independent auditors noted that
the Company's recurring losses from operations and negative cash
flows from operations raise substantial doubt about its ability to
continue as a going concern.
Bankruptcy Warning
"At March 31, 2014, we had a cash balance of $5,400, a working
capital deficit of approximately $2.9 million and an accumulated
deficit of approximately $22.9 million. We have experienced
losses from operations since our inception, and we have relied on
a series of private placements and convertible debentures to fund
our operations. The Company cannot predict how long it will
continue to incur losses or whether it will ever become
profitable.
Pursuant to a Senior Note Purchase Agreement dated as of April 3,
2014, by and among the Company, IBI, Infusion, eDiets.com, Inc.,
Tru Hair, Inc., TV Goods Holding Corporation, Ronco Funding LLC
(collectively, the "Credit Parties"), and MIG7 Infusion, LLC
(?MIG7? and such agreement, the "Note Purchase Agreement"), the
Credit Parties sold to MIG7 a senior secured note having a
principal amount of $10,180,000 bearing interest at 14% and having
a maturity date of April 3, 2015 (the "MIG7 Note"). See Note 15.
We have undertaken, and will continue to implement, various
measures to address our financial condition, including:
* Significantly curtailing costs and consolidating operations,
where feasible.
* Seeking debt, equity and other forms of financing, including
funding through strategic partnerships.
* Reducing operations to conserve cash.
* Deferring certain marketing activities.
* Investigating and pursuing transactions with third parties,
including strategic transactions and relationships.
There can be no assurance that we will be able to secure the
additional funding we need. If our efforts to do so are
unsuccessful, we will be required to further reduce or eliminate
our operations and/or seek relief through a filing under the U.S.
Bankruptcy Code," the Company stated in the Fiscal 2014 Annual
Report.
ASHLEY STEWART: Amends Consulting Agreement With Gordon Brothers
----------------------------------------------------------------
Ashley Stewart Holdings Inc., et al., amend their consulting
agreement with Gordon Brothers Retail Partners, LLC, to enable
GBRP to conduct store closing sales at 27 additional store
locations. The sale term with respect to each respective store
will commence on May 14, 2014, and will terminate no later than
June 30, 2014.
Pursuant to the Amended Consulting Agreement, Ashley Stewart,
Inc., retains GBRP as its exclusive, independent consultant to
conduct the sale at the stores during the sale term. GBRP will,
among other things, (ii) recommend appropriate merchandise
discounting, point-of-purchase, point-of-sale, and other internal
and external advertising and signage, and merchandise
presentation, in each case as necessary to effectively sell all
merchandise in accordance with the store closing or other mutually
agreed upon themed sale; (ii) provide qualified supervisors with
respect to the stores to oversee the sale process in the stores;
and (iii) recommend sale-related customer service and housekeeping
activities.
Ashley Stewart will pay GBRP a fee equal to 2.0% of the gross
proceeds of all sales of merchandise made in the store during the
sale term, net only of sales taxes. Ashley Stewart will pay GBRP
the fee weekly on account of the prior week's sales.
The Debtors say in a filing dated May 13, 2014, that the economic
terms of the Amended Consulting Agreement are more advantageous to
the Debtors than the original consulting agreement because,
pursuant to that certain April 23, 2014 transition services
agreement, all costs related to conducting the store closing sales
at the additional closing stores will be borne by the buyer. A
copy of the Amended Consulting Agreement is available for free at
http://is.gd/BndY6l
On March 12, 2014, the United States Bankruptcy Court for the
District of New Jersey entered an order authorizing the Debtors to
(a) conduct store closing sales at certain locations,
(b) enter into and approving that certain March 6, 2014 consulting
agreement with GBRP, and (c) reject the unexpired leases of
nonresidential real property of the Initial Closing Stores.
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.
BAXANO SURGICAL: Reports $9.11-Mil. Loss for Q1 Ended March 31
--------------------------------------------------------------
Baxano Surgical, Inc., filed its quarterly report on Form 10-Q,
disclosing a net loss of $9.11 million on $4.41 million of revenue
for the three months ended March 31, 2014, compared with a net
loss of $7.1 million on $3.1 million of revenue for the same
period in 2013.
The Company's balance sheet at March 31, 2014, showed $40.91
million in total assets, $18.42 million in total liabilities, and
stockholders' equity of $22.49 million.
Since inception, the Company has been unprofitable. As of March
31, 2014, the Company had an accumulated deficit of $179.9
million. The Company's independent registered public accounting
firm has indicated in its audit report on the Company's fiscal
2013 financial statements, included in its 2013 Form 10-K, that
the Company's recurring losses from operations raise substantial
doubt about its ability to continue as a going concern.
A copy of the Form 10-Q is available:
http://is.gd/GLuAin
Baxano Surgical is a medical device company focused on designing,
developing and marketing products to treat degenerative conditions
of the spine affecting the lumbar region. It markets the AxiaLIF
family of products for single and two level lumbar fusion, the VEO
lateral access and interbody fusion system, the iO-Flex minimally
invasive lumbar decompression system, the iO-Tome facetectomy
system, and the Vectre and Avatar posterior fixation systems. The
company was founded in May 2000 and is headquartered in Raleigh,
NC.
BELDEN INC: Moody's Affirms 'Ba2' Rating on $200MM Sub. Notes
-------------------------------------------------------------
Moody's Investors Service affirmed Belden, Inc.'s Ba1 Corporate
Family Rating and Ba1-PD Probability of Default Rating and
assigned a Ba2 rating to the proposed $200 million senior
subordinated notes but revised the ratings outlook to negative
from stable.
Proceeds of the new notes, due 2024, are being used to replenish
some of the cash that was used to fund strategic investments and
acquisitions. It is anticipated that proceeds will be used for
capital expenditures, additional strategic acquisitions and share
buybacks.
Ratings Rationale
The change in ratings outlook to negative reflects the increase in
leverage as a result of the new debt and the potential that
leverage will remain at elevated levels particularly if Belden
continues to raise debt to fund acquisitions. As a result of the
proposed financing, leverage will be approximately 5x pro forma
for the new debt and the Grass Valley acquisition, a level well
above Ba1 peers. Though the company's strong cash balances provide
some offset to the high leverage, the company continues to use
some of its cash to fund share buybacks and dividends. While some
of the company's cash balances and internally generated cash will
likely be used to acquire profitable businesses and contribute to
de-leveraging, integration challenges or material restructuring
costs could push out de-leveraging and drive a downgrade The
ratings could also be downgraded if cash levels decline without a
commensurate reduction in leverage.
Nonetheless, the company has potential to reduce leverage to below
4x by 2015 if the company can improve margins and effectively
integrate Grass Valley. Belden can further lower leverage if it
uses its cash to buy additional profitable businesses. The Ba1
corporate family rating continues to reflect Belden's leading
positions within segments of the enterprise, broadcast and
industrial cabling, connectivity and networking product markets,
which can produce solid operating margins and good free cash flow.
Liquidity is expected to remain very good with healthy cash
balances ($570 million at March 31, 2014, and an estimated $440
million pro forma for recent strategic investments, acquisitions
and proposed debt issuance) and an undrawn $400 million asset
based revolver. Belden is also expected to generate over $150
million free cash flow over the next year.
Assignments:
Issuer: Belden Inc.
US$200M Senior Subordinated Regular Bond/Debenture, Assigned
Ba2, LGD4, 67%
Outlook Actions:
Issuer: Belden Inc.
Outlook, Changed To Negative From Stable
Affirmations:
Issuer: Belden Inc.
Corporate Family Rating, Affirmed Ba1
Probability of Default Rating, Affirmed Ba1-PD
Speculative Grade Liquidity Rating, Affirmed SGL-1
US$700M 5.5% Senior Subordinated Regular Bond/Debenture Sep 1,
2022, Affirmed Ba2, range of LGD4, 67 % from a range of LGD4,
65 %
US$200M 9.25% Senior Subordinated Regular Bond/Debenture Jun
15, 2019, Affirmed Ba2, range of LGD4, 67 % from a range of
LGD4, 65 %
EUR300M 5.5% Senior Subordinated Regular Bond/Debenture Apr 15,
2023, Affirmed Ba2, range of LGD4, 67 % from a range of LGD4,
65 %
US$250M Senior Secured Bank Credit Facility Sep 25, 2020,
Affirmed Baa2, range of LGD2, 19 % from a range of LGD2, 12 %
The principal methodology used in this rating was the Global
Manufacturing Industry published in December 2010. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Belden Inc. is a leading designer and manufacturer of connectivity
and signal transmission products for the global network
communication and specialty electronic marketplaces with 2013
revenues of $2.1 billion. The company is headquartered in St.
Louis, Missouri.
BEVERLY BANCORP: Files Chapter 11 Plan
--------------------------------------
Beverly Hills Bancorp Inc. filed with the U.S. Bankruptcy Court
for the District of Delaware a Chapter 11 plan of reorganization
that impairs general unsecured claims.
Under the Plan, each Holder of an Allowed General Unsecured Claim
will receive on the later of the Effective Date or the date the
Claim becomes an Allowed General Unsecured Claim, or as soon
thereafter as is practicable, in full and final satisfaction of
its Claim, together with the Holders of Allowed Indemnification
Claims, its Pro Rata share of all Distributable Cash. In
addition, the Holders of General Unsecured Claims that are
Guaranteed TruPS Claims are deemed to provide to, and receive
from, all of the Releasing Parties and Related Parties the
releases from Causes of Action. On the effective date, a
liquidation trust will be established.
A full-text copy of the Plan dated June 25, 2014, is available at
http://bankrupt.com/misc/BEVERLYplan0625.pdf
The Plan was filed by Eric E. Sagerman, Esq., Justin E. Rawlins,
Esq., and Edward S. Son, Esq., at Winston & Strawn LLP, in Los
Angeles, California; and Robert S. Brady, Esq., Joseph M. Barry,
Esq., and Laurel D. Roglen, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, on behalf of the Debtor.
About Beverly Hills Bancorp
Beverly Hills Bancorp Inc., former owner of First Bank of Beverly
Hills, filed a petition for Chapter 11 protection (Bankr. D. Del.
Case No. 14-bk-10897) on April 15, 2014, as a forbearance
agreement was expiring in connection with $25.8 million in trust-
preferred securities. The bank subsidiary was taken over by
regulators in April 2009. All other subsidiaries are inactive.
The Debtor's counsel is Young, Conaway, Stargatt & Taylor, LLP,
while its restructuring advisor is Development Specialists, Inc.
BREEZY PALMS: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------
Debtor: Breezy Palms I, LLC
500 Friday Road
Cocoa, FL 32926
Case No.: 14-07313
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Middle District of Florida (Orlando)
Debtor's Counsel: David R McFarlin, Esq.
WOLFF, HILL, MCFARLIN & HERRON, P.A.
1851 West Colonial Drive
Orlando, FL 32804
Tel: 407-648-0058
Fax: 407-648-0681
Email: dmcfarlin@whmh.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jeffrey C. Unnerstall, managing member.
The Debtor listed CRE Venture 2011-2, LLC, c/o Saxon, Gilmore, et
al, Attn David J. Tong 201 E Kennedy Blvd #600, in Tampa, Florida,
as its largest unsecured creditor holding a claim of $2.8 million.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/flmb14-07313.pdf
BREVITY VENTURES: Meeting to Form Creditors' Panel on July 2
------------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on July 2, 2014, at 10:00 a.m. in
the bankruptcy case of Brevity Ventures Inc. The meeting will be
held at:
J. Caleb Boggs Federal Building
844 King St., Room 5209
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
BS QUARRIES: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: B.S. Quarries, Inc.
859 John C. McNamara Drive
Montrose, PA 18801
Case No.: 14-02954
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Middle District of Pennsylvania (Wilkes-Barre)
Judge: Hon. John J Thomas
Debtor's Counsel: Harry J. Giacometti, Esq.
William J. Burnett, Esq.
FLASTER/GREENBERG, P.C.
Four Penn Center, 2nd Floor
1600 John F. Kennedy Boulevard
Philadelphia, PA 19103
Tel: 215-587-5680
Fax: 215-279-9394
Email: harry.giacometti@flastergreenberg.com
william.burnett@flastergreenberg.com
Estimated Assets: $10 million to $50 million
Estimated Debts: $10 million to $50 million
The petition was signed by Timothy Smith, president.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
C&S GROUP: Moody's Rates New $400MM Senior Secured Notes 'B1'
-------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to C&S Group
Enterprises LLC's proposed $400 million senior secured notes due
2022. Moody's also revised C&S's rating outlook to stable from
positive and affirmed its corporate family rating and probability
of default rating at Ba3 and Ba3-PD respectively. The B1 rating of
the company's existing $240 million senior secured notes is
affirmed and will be withdrawn upon closing of the transaction.
The stable rating outlook reflects Moody's expectation that credit
metrics will demonstrate only modest improvement in the next 12
months. Moody's expects debt/EBITDA and EBITA/interest adjusted
for leases and pensions to be around 4.0 to 4.5 times and 1.5 to
2.0 times respectively for the next 12-18 months.
"Although C&S has demonstrated impressive organic growth, Moody's
expect future growth opportunities will increasingly be driven
through acquisitions which could result in higher funded debt
levels", Moody's Senior Analyst Mickey Chadha stated.
Following ratings were affirmed:
Corporate Family Rating at Ba3
Probability of Default Rating at Ba3-PD
Following ratings are assigned:
Proposed $400 million senior secured guaranteed notes due 2022
at B1 (LGD5, 77%)
The following ratings are affirmed and will be withdrawn upon
closing:
$240 million senior secured guaranteed notes due 2017 at B1
(LGD5, 78%)
Ratings Rationale
C&S's Ba3 Corporate Family Rating continues to reflect the
company's leading position in a highly fragmented industry,
moderate funded debt level, and good liquidity. The rating also
reflects the risks associated with the company's high customer
concentration, its thin margins, and its high fixed cost
structure.
A material loss of revenue or negative impact on cash flow from
serviced stores due to closures or divestitures or loss of any
material customer could result in a downgrade. Quantitatively,
ratings could be lowered if EBITA/interest is sustained below 1.5
times or debt/EBITDA remains above 4.75 times.
A higher rating would likely require a stable operating
environment, a continuation of current business volumes, balanced
financial policies particularly regarding future growth through
acquisitions, sustained EBITA/interest above 2.0 times, and
sustained debt/EBITDA below 4.0 times.
The principal methodology used in this rating was the Global
Distribution & Supply Chain Services Industry published in
November 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.
C&S Group Enterprises LLC, issuer of the rated debt, is a
financing subsidiary of C&S Wholesale Grocers Inc. and four
affiliated operating companies (which together comprise the "C&S
Issuer Group"). C&S Wholesale Grocers is a distributor of
groceries to food retailers in the U.S. Consolidated revenues of
C&S Issuer Group are approximately $23 billion.
C&S WHOLESALE: S&P Rates $400MM Sr. Secured Notes 'BB'
------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BBB-' issue level
rating to C&S Wholesale Grocers Inc.'s $1.5 billion ABL revolving
credit facility with a '1' recovery rating, indicating S&P's
expectation for very high (90%-100%) recovery in the event of a
payment default. S&P also assigned a 'BB' issue-level rating and
'4' recovery rating to the company's $400 million senior secured
notes. The '4' recovery indicates S&P's expectation for average
(30% to 50%) recovery for noteholders in the event of a payment
default.
Concurrently, S&P affirmed its 'BB' corporate credit rating on
parent company C&S Wholesale Grocers Inc. The outlook is stable.
According to the company, proceeds from the new $400 million
senior secured notes will be used to repay its existing $300
million ($240 million outstanding as of March 29, 2014) senior
notes and borrowings outstanding under the revolving credit
facility.
"We based our view of C&S' business risk profile on the company's
position as the largest wholesale grocery distributors in the U.S.
based on revenue, its low cost position, and efficient
operations," said credit analyst Kristina Koltunicki.
"Significant customer concentration and thin but stable
profitability mitigate these strengths. In our view, the loss of
one or more large customers is a risk factor for C&S as this could
materially affect its operating performance. However, C&S has
been successful in growing its sales volume through new contracts
and incremental business with existing large customers. We
believe further consolidation in the grocery industry could
benefit C&S as the company provides efficient operations and
buying power to its customers."
The stable outlook on C&S reflects S&P's expectation that the
company will be able to sustain EBITDA margins, adequate
liquidity, and credit metrics consistent with indicative ratios
including adjusted debt to EBITDA between 4x and 5x and FFO to
debt of 12% to 20%. S&P also expects the company to generate
positive free cash flow (before acquisitions) and to pursue
disciplined acquisition activity.
Downside scenario
S&P could lower the rating if more aggressive financial policies
from debt-financed acquisitions or a return to shareholders causes
credit protection measures to deteriorate to such an extent that
total debt to EBITDA approaches 5.0x or FFO to total debt drops
below 12% on a sustained basis. In order for this to occur, the
company would incur an estimated $300 million of additional debt,
holding EBITDA levels at the end of March 2014 constant. At that
point, S&P would revise its financial risk profile score to
"highly leveraged".
Upside scenario
Although S&P considers the possibility for an upgrade to be remote
over the next 12 months because EBITDA would have to approximately
double from current levels, S&P could raise its ratings if C&S can
achieve a sustained improvement in its financial risk profile to
levels consistent with an "intermediate" financial risk profile.
This could occur if operating performance trends continue to be
positive and debt levels remain stable, resulting in debt leverage
in the 2.0x area and FFO to total debt of above 30%.
C-MOTECH: Seeks U.S. Recognition of Korean Bankruptcy
-----------------------------------------------------
The administrator of C-Motech Co., Ltd., filed a Chapter 15
bankruptcy petition in San Diego, California, to seek recognition
of the company's bankruptcy proceedings in Korea.
According to court filings, C-Motech's woes started in February
2010 when Namu Equity Ltd. took over the company too become the
largest shareholder to use the corporate seal of the company so
that authentic deeds of promissory notes for unknown transactions
were over-issued, raising suspicion of misappropriation or
embezzlement.
In connection with the cash flow of the company, an external
auditor expressed a negative opinion, which resulted in delisting
of the company. Moreover, several tens of seizure and collection
orders were issued to the properties of the company based on the
authentic deeds of promissory notes, thereby preventing the
company from conducting normal business activities, and leading to
financial disaster.
A rehabilitation plan for the company was approved in November
2011. Pursuant to the plan, loan claims of financial
institutions, transaction claims, debts for compensation for
damage and employee claims will be paid off in the form of
converting 71% of the debt into equity and repaying 29% of the
debt in cash in installments from 2016 until 2021.
As of the end of 2010, the company had assets of KRW104.9 billion
and debt of KRW50.2 billion.
About C-Motech Co.
Seoul, Korea-based C-Motech Co. was a developer and producer of
wireless data communication devices. Established in 2002, the
company ran a business associated with software, databases and
information processing.
In April 2011, the 4th Department of Bankruptcy of the Seould
Central District Court authorized the company to commence
rehabilitation procedures (Case No. 2011 Hoihap 42 Rehabilitation)
as stipulated in Korea's Article 34(1) of the Debtor
Rehabilitation and Bankruptcy Act.
Young-Gu Park was appointed by the Korean Court as administrator.
The administrator has the power to conduct all of C-Motech's
business and manage all of its property, subject to the Korean
Bankruptcy Court's supervision.
The administrator of C-Motech filed a Chapter 15 bankruptcy
petition for the company (Bankr. S.D. Cal. Case No. 14-04891) in
San Diego, California, on June 19, 2014. The debtor is estimated
to have assets and debt of $10 million to $50 million.
The Chapter 15 case is assigned to Judge Christopher B. Latham.
The company is represented by Michael T. O'Halloran, Esq., in San
Diego in the U.S. case.
CALYPTE BIOMEDICAL: Incurs $1.1 Million Net Loss in 2012
--------------------------------------------------------
Calypte Biomedical Corporation filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K for the year
ended Dec. 31, 2012. The Company disclosed a net loss of $1.07
million on $230,000 of product sales for 2012, as compared with a
net loss of $693,000 on $579,000 of product sales for 2011.
The Company's balance sheet at Dec. 31, 2012, showed $1.76 million
in total assets, $7.02 million in total liabilities and a $5.26
million total stockholders' deficit.
OUM & Co. LLP, in San Francisco, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has suffered recurring operating losses and
negative cash flows from operations, and management believes that
the Company's cash resources will not be sufficient to sustain its
operations through 2012 without additional financing. This raises
substantial doubt about the Company's ability to continue as a
going concern.
A full-text copy of the Form 10-K is available for free at:
http://is.gd/fn28zt
About Calypte Biomedical
Portland, Oregon-based Calypte Biomedical Corporation develops,
manufactures, and distributes in vitro diagnostic tests, primarily
for the diagnosis of Human Immunodeficiency Virus ("HIV")
infection.
CASH STORE: Cease Trade Order Issued by the OSC
-----------------------------------------------
The Cash Store Financial Services disclosed that a Cease Trade
Order was issued on June 18, 2014, by the Ontario Securities
Commission due to the Company's failure to file interim financial
statements for the 6-month period ended March 31, 2014, interim
management's discussion and analysis, and certification of interim
filings for the period ended March 31, 2014, as required by
National Instrument 52-109 Certification of Disclosure in Issuers'
Annual and Interim Filings.
The Company previously announced a Cease Trade Order was issued on
May 30, 2014, by the Alberta Securities Commission due to the
Company failing to file interim unaudited financial statements,
interim management's discussion and analysis, and certification of
interim filings for the period ended March 31, 2014,
(collectively, the "Continuous Disclosure Documents") pursuant to
section 146 of the Securities Act (Alberta). Per the terms of the
Cease Trade Order, all trading in the Company's securities has
ceased.
As Cash Store Financial announced on May 16, 2014, its inability
to file these materials is attributable to the circumstances of
the Company's ongoing court-supervised restructuring process under
the Companies' Creditors Arrangement Act ("CCAA"). Cash Store
Financial intends to file the Continuous Disclosure Documents as
soon as is commercially reasonable, or as requested by the Court,
and is committed to completing the restructuring process as
quickly and efficiently as is possible.
The Company remains open for business with its branches operating.
Further details regarding the Company's CCAA proceedings are
available on the Monitor's Web site at
http://cfcanada.fticonsulting.com/cashstorefinancial/.
About Cash Store Financial
Headquartered in Edmonton, Alberta, Cash Store Financial Services
Inc. (TSX: CSF) is a lender and broker of short-term advances and
provider of other financial services in Canada. Cash Store
Financial operates 510 branches across Canada under the banners
"Cash Store Financial" and "Instaloans". Cash Store Financial also
operates 27 branches in the United Kingdom.
Cash Store Financial is not affiliated with Cottonwood Financial
Ltd. or the outlets Cottonwood Financial Ltd. operating in the
United States under the name "Cash Store". Cash Store Financial
does not do business under the name "Cash Store" in the United
States and does not own or provide any consumer lending services
in the United States.
Cash Store Financial reported a net loss and comprehensive loss of
C$35.53 million for the year ended Sept. 30, 2013, as compared
with a net loss and comprehensive loss of C$43.52 million for the
year ended Sept. 30, 2012. As of Sept. 30, 2013, the Company had
C$164.58 million in total assets, C$165.90 million in total
liabilities and a C$1.32 million shareholders' deficit.
CIENA CORPORATION: Moody's Assigns 'B2' Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating
and a B2-PD probability of default rating to Ciena Corporation.
Moody's also assigned a Ba2 rating to Ciena's proposed senior
secured term loan. Ciena will use the proceeds from the term loan
for general corporate purposes, which may include the repayment of
certain indebtedness. The ratings outlook is stable.
Ratings Rationale
Ciena's B2 corporate family rating reflects solid market position
in the approximate $13 billion next generation communications
networking sector. Moody's expect service providers will continue
investing to augment the capacity and intelligence of their
optical backbone networks in order to drive down unit costs and
create the economics/cost structure to handle the huge and growing
amounts of IP traffic that they transport to and from customers.
With a solid market presence, good product positioning and a
broadening customer base, Ciena should benefit from a market that
Moody's anticipate will grow in the mid single digits over the
next few years.
While improving, profitability is modest, with adjusted EBITDA
margins just over 7%. The rating is also constrained by high
financial leverage, with adjusted debt to EBITDA at 8.5x as of
April 2014, although Moody's expect leverage should decline to
around 6.5x by the fiscal year ended October 2015 as a result of
earnings improvement. Although still somewhat concentrated,
Ciena's customer diversification is improving and, over time, the
company's nascent partnership with Ericsson should further improve
Ciena's presence overseas.
The following ratings were assigned:
Corporate Family Rating: B2
Probability of default: B2-PD
Speculative Grade Liquidity Rating: SGL-2
$250 million senior secured term loan, Ba2, LGD2
Ratings outlook: stable
The stable outlook reflects Moody's expectations that Ciena's good
product positioning will support the company's ability to at least
maintain and defend its solid market position in the next
generation communications networking market.
The ratings could be upgraded if Ciena is likely to sustain
revenue growth and expand adjusted EBITDA margins above 10%, while
sustaining adjusted debt to EBITDA below 6 times and maintaining a
good liquidity profile.
The ratings could be lowered if there is a deterioration in
business fundamentals evidenced by sustained revenue declines and
adjusted EBITDA margins falling toward 5%. Additionally, adjusted
debt to EBITDA sustained above 6.5 times (after considering the
March 2015 debt maturity) could pressure the rating.
The principal methodology used in this rating was Global
Communications Equipment Industry published in June 2008. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
CLAUDE RESOURCES: Covenant Waiver Requires Strategic Review
-----------------------------------------------------------
Timothy Stabosz, at 5.2% ownership, the largest shareholder of
Canadian based Claude Resources, Inc. on June 25 announced the
filing of Schedule 13D with the U.S. Securities and Exchange
Commission.
In the filing, Mr. Stabosz notes the company's covenant waiver
with its lender, Crown Capital, requiring Claude to explore a
potential sale, and complete a strategic review process, by
July 31. Mr. Stabosz expresses his support for a sale of Claude,
assuming a fair price is obtained for the shareholders, and that
the company is "fully shopped."
In addition, Mr. Stabosz requested that the board of directors
immediately add one or more major outside shareholder
representatives to the Claude board, 1) to assist in the
evaluation of strategic alternatives, and also 2) to ensure that
the lengthy record of value destruction, and massive dilution,
under the former CEO, can be properly relegated to Claude's past,
and not be any part of its future.
Mr. Stabosz stated, "As a dyed in the wool value investor, I am
excited by the prospects Claude offers to maximize shareholder
value, through a turnaround in the company's operations, through
development of the high grade Santoy Gap deposit, and/or through a
sale of the company. It is necessary and proper for our company's
board to be mindful of the 18 year record of value destruction,
under the former CEO. In order to establish to the investment
community that a 'new Claude' is firmly in place, it is critical
for the board to welcome one or more representatives from the
outside shareholder base. This is especially true, considering
the extraordinary pain that Claude's long term shareholders have
experienced.
"As the largest shareholder of Claude, I have offered to serve on
the board, and believe that such service would be a welcome
reassurance and comfort to my fellow shareholders. I also believe
my serving would likely broaden Claude's shareholder base, and
increase its reputation for open, inclusionary, and expansive
corporate governance. My relationship with Claude's management is
solid, my affection for the company runs deep, and I have become a
student of its history . . . ever sensitive to the important
constituencies whose lives the company touches. More importantly,
the votes cast by me at the recent annual shareholder meeting
represented more than 30% of the total votes cast, justifying my
being provided a seat at the table, as a representative of the
entire outside shareholder base.
"It is my hope that a new day may very well be dawning for Claude.
I believe the company is in an enviable position, at this time,
because of the recent successful capital raises, which, while
ill-timed, represent management's concerted and diligent efforts
to do the right thing, and avoid dilution. I commend current and
former management for having the fortitude to see this difficult
and challenging process through. As we sit here today, Santoy Gap
is ahead of schedule, and rapidly coming to fruition, while the
company has significantly reduced its per ounce cost of
production, making Claude an increasingly attractive 'tuck in'
candidate for a potential acquiror. That having been said, if the
company does not receive expressions of interest that reflect the
turnaround the company has been realizing, and the underlying
value of the Seabee mine, I believe the company should retain the
option of remaining independent, seeking to increase shareholder
value through improved performance," Stabosz concluded.
Mr. Stabosz is a "deep value" investor, specializing in low
priced, microcap stocks selling for steep discounts to traditional
valuation metrics, such as price to book, price to sales, etc. He
employs Graham and Dodd, among other regimens, in his research.
Claude Resources Inc. -- http://www.clauderesources.com-- is
engaged in the acquisition, exploration, and development of
precious metal properties and the production and marketing of
minerals. Claude's mineral properties are located in northern
Saskatchewan and northwestern Ontario. The Company's mineral
property portfolio includes the Seabee Property, a producing gold
mine and exploration properties located at Laonil Lake,
Saskatchewan, approximately 125 kilometers northeast of La Ronge,
Saskatchewan. This operation had produced 928,767 ounces of gold
as of December 31, 2010. It also holds a portfolio of exploration
properties in Canada, which are located in the provinces of
Saskatchewan, Manitoba and Ontario, including the Madsen
Properties. The Madsen Properties consists of six contiguous
claim blocks totaling approximately 10,000 acres (4,000 hectares)
located in the Red Lake Mining District of northwestern Ontario.
In February 2012, the Company acquired St. Eugene Mining
Corporation Limited.
CLEVER IMPORTS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Clever Imports LLC
1665 Palm Beach Lakes Blvd #810
West Palm Beach, FL 33401
Case No.: 14-24461
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Hon. Paul G. Hyman, Jr.
Debtor's Counsel: Kenneth S Rappaport, Esq.
RAPPAPORT OSBORNE & RAPPAPORT, PL
1300 N Federal Hwy #203
Boca Raton, FL 33432
Tel: (561) 368-2200
Email: rappaport@kennethrappaportlawoffice.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Cecile Giraud, manager.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/flsb14-24461.pdf
CNH INDUSTRIAL: S&P Rates Proposed Sr. Unsecured Notes 'BB'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' issue rating
to U.S.-based CNH Industrial Capital LLC's proposed senior
unsecured notes. CNH Industrial Capital America LLC and New
Holland Credit Co. LLC, each a wholly owned subsidiary of CNH
Industrial Capital, will guarantee the notes. The company expects
to use the proceeds from the debt issuance for working capital or
other general corporate purposes.
The rating on the proposed senior unsecured notes reflects the
company's reliance on secured debt, primarily through asset-backed
security transactions, which S&P believes continues to encumber a
significant majority (about 65% after giving effect to the
proposed issuance) of the assets on its balance sheet. S&P also
believes that these transactions would significantly weaken the
recovery prospects for the unsecured debtholders in the event of a
default. Still, the ratio of secured debt to assets has declined
over the past three years, the company has access to unsecured
committed credit lines, and S&P views the proposed notes issuance
as a consistent step toward achieving greater funding
diversification. This should gradually reduce reliance on the
asset-backed securities market, which S&P would consider a
positive rating factor over time.
CNH Industrial Capital, formerly known as CNH Capital LLC, is a
wholly owned subsidiary of Netherlands-based CNH Industrial N.V.
(CNHI). The company is a captive finance company that provides
financial services for CNHI's customers in the U.S. and Canada.
The 'BB+' corporate credit rating on CNH Industrial Capital
reflects the long-term corporate credit rating on CNHI, its
parent. S&P views this subsidiary as a core holding of CNHI,
given its strategic importance to the parent (financial services
are a key offering that facilitates the sale of CNHI's equipment),
CNHI's ability to influence its actions, and S&P's expectation
that the parent would provide financial support to the company in
times of need. There is a support agreement between the two
companies, and CNH Industrial Capital's receivables account for
about half of the total managed portfolio of CNHI's financial
services organization globally.
RATINGS LIST
CNH Industrial Capital LLC
Corporate Credit Rating BB+/Stable/--
New Rating
CNH Industrial Capital LLC
Senior unsecured notes BB
COLOR STAR: Exclusive Solicitation Period Extended to Aug. 12
-------------------------------------------------------------
The Hon. Brenda T. Rhoades of the U.S. Bankruptcy Court for the
Eastern District of Texas has extended, at the behest of Color
Star Growers of Colorado, Inc., et al., the period within which
the Debtors have the exclusive right to solicit acceptances on
their proposed Chapter 11 plan to Aug. 12, 2014.
The Court also extended to June 13, 2014, the period within which
the Debtors have the exclusive right to file their plan.
As reported by the Troubled Company Reporter on May 29, 2014, the
hearing on the motion was set for June 9, 2014, at 3:30 p.m.
About Color Star
Color Star, a grower and wholesaler of flowers and nursery stock
with greenhouses and distribution centers in Colorado, Missouri
and Texas, filed for Chapter 11 bankruptcy protection in December
2013.
Color Star Growers of Colorado, Inc., and two affiliates filed
Chapter 11 bankruptcy petitions (Bankr. E.D. Tex. Case Nos. 13-
42959 to 13-42961) on Dec. 15, 2013, in Sherman, Texas. The
petitions were signed by Brad Walker, chief restructuring officer.
The Debtors estimated assets of at least $10 million and
liabilities of at least $50 million.
Marcus A. Helt, Esq., and Evan R. Baker, Esq., at Gardere Wynne
Sewell LLP, serve as the Debtors' counsel. SSG Advisors, LLC
provides investment banking services, and UpShot Services LLC
serves as claims, noticing and balloting agent.
The Official Committee of Unsecured Creditors appointed in the
Debtors' cases retained Gavin/Solmonese, LLC as financial
advisors; and Raymond J. Urbanik, Esq., Deborah M. Perry, Esq.,
Thomas Berghman, Esq., and Isaac J. Brown, Esq., at Munsch Hardt
Kopf & Harr, PC as attorneys.
CUE & LOPEZ: Plan Filed; Disclosure Statement Hearing on Aug. 6
---------------------------------------------------------------
Bankruptcy Judge Brian K. Tester will convene a hearing on Aug. 6
2014, at 9:00 a.m., to consider adequacy of information in the
Disclosure Statement explaining Cue & Lopez Construction Inc.'s
Plan of Reorganization. Objections, if any, are due 14 days prior
to the hearing.
The Disclosure Statement dated June 20, 2014, provides an
estimated recovery for claims against and shareholder interest in
the Debtor:
DESCRIPTION ESTIMATED ESTIMATED
OF CLAIM AMOUNT OF RECOVERY
ALLOWED
CLAIM
----------- ----------- ---------
Holders of Allowed $144,603 100%
Administrative Expense
Claims
Holders of Allowed $1,219,666 100%
Priority Tax Claims
Secured and Unsecured
Holders of Allowed $3,289 100%
Other Priority
Claims
The Allowed Claim $2,645,445 76%
of Scotiabank de
P.R.
The Allowed Claim $110,000 74%
of Oriental Financial
Group
The Allowed Claims $3,399,187 36%
of Oriental Bank
The Allowed Claim
of Toyota Credit de P.R. $54,817 100%
Holders of Allowed $11,756,598 5%
General Unsecured
Claims
Interests in Debtor n/a n/a
The Plan provides that claims will be paid with available funds
arising from the Debtor's operations, available cash balance as of
the Effective Date, the collection of the Debtor's accounts
receivable, and of certain retainage accounts in various projects,
and the surrender of real properties. The Debtor's cash flows
projections show the Debtor's results of operations during the
three-year period ending on June 30, 2017, which considers the
implementation of the Plan.
Copies of the Plan documents are available at:
http://bankrupt.com/misc/CUE&LOPEZ_253_ds.pdf
http://bankrupt.com/misc/CUE&LOPEZ_256_dshearing.pdf
The Debtor is represented by:
CHARLES A. CUPRILL P.S.C. LAW OFFICES
356 Fortaleza Street, Second Floor
San Juan, PR 00901
Tel: (787) 977-0515
Fax: (787) 977-0518
E-mail: ccuprill@cuprill.com
About Cue & Lopez
San Juan, Puerto Rico-based Cue & Lopez Construction, Inc., sought
protection under Chapter 11 of the Bankruptcy Code on Oct. 4, 2013
(Case No. 13-08297, Bankr. D.P.R.). The case is assigned to Judge
Brian K. Tester.
Cue & Lopez Contractors, Inc., filed a separate Chapter 11
petition (Case No. 13-08299) on the same date.
The Debtors are represented by Charles Alfred Cuprill, Esq., at
Charles A Curpill, PSC Law Office, in San Juan, Puerto Rico. CPA
Luis R. Carrasquillo & Co., P.S.C., serves as accountant.
Cue & Lopez Construction scheduled $13,334,151 in total assets and
$17,520,089 in total liabilities. The Chapter 11 petitions were
signed by Frank F. Cue Garcia, president.
CUNNINGHAM LINDSEY: Moody's Lowers Corp. Family Rating to 'B2'
--------------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating of Cunningham Lindsey U.S. Inc. to B2 from B1 based on
lower global insured claims volumes leading to a decline in
projected revenues and EBITDA. The rating agency also downgraded
Cunningham Lindsey's probability of default and credit facility
ratings. The rating outlook is negative reflecting the company's
substantial financial leverage and limited interest coverage along
with the challenge of expanding revenues and earnings, given the
fluctuations in global claims activity.
Ratings Rationale
"The rating downgrade reflects the challenges Cunningham Lindsey
has faced from a decline in global insured claims volume over the
past year, and low catastrophe losses in the US, leading to a
decline in revenue and earnings, higher financial leverage and
lower interest coverage," said Enrico Leo, Moody's lead analyst
for Cunningham Lindsey. "The company is taking steps to reduce
costs and expand its service offerings, but Moody's regard the
projected credit metrics as more consistent with a B2 corporate
family rating."
Cunningham Lindsey's ratings reflect its strong market position in
claims management services and its diversified global customer
base. With its worldwide network, the company manages claims
across multiple jurisdictions for global insurers and self-insured
entities -- an offering that few competitors can match. These
strengths are offset by high financial leverage, low interest
coverage, and fluctuations in the volume of weather-related and
other complex claims, which account for a sizable portion of the
company's revenue. Cunningham Lindsey also faces integration and
execution risk related to mergers and acquisitions along with
potential liabilities from errors and omissions, a risk inherent
in professional services.
Based on Cunningham Lindsey's recent earnings, and giving effect
to certain cost reduction efforts, Moody's estimates (which often
differ from company calculations) that the company's gross debt-
to-EBITDA ratio is around 8x, which is aggressive for its rating
category. While the company currently maintains a relatively large
balance of cash and equivalents, the rating agency expects that
Cunningham Lindsey will use a majority of this cash for EBITDA-
enhancing acquisitions, helping to reduce financial leverage over
the next 12 to 18 months. Through March 31, 2014 (trailing twelve
months), the company's revenue declined by 6% compared to calendar
2012, driven by a large decline in global insured claims volume
and benign catastrophe losses in the US, one of the company's
largest operating regions.
Factors that could lead to a return to stable outlook include: (i)
debt-to-EBITDA ratio below 6.5x; (ii) (EBITDA - capex) coverage of
interest of 1.5x or greater, (iii) free-cash-flow-to-debt ratio of
3% or above. Factors that could lead to a rating downgrade
include: (i) debt-to-EBITDA ratio remaining above 6.5x, (ii)
(EBITDA - capex) coverage of interest remaining below 1.5x, (iii)
free-cash-flow-to-debt ratio below 3% for a sustained period.
Moody's has downgraded the following ratings (and loss given
default (LGD) assessments) of Cunningham Lindsey with a negative
outlook:
Corporate family rating to B2 from B1;
Probability of default rating to B2-PD from B1-PD;
$510 million first-lien term loan (maturing 2019) to B1 (LGD3,
40%) from Ba3 (LGD3, 40%);
$140 million first-lien revolving credit facility (maturing
2017) to B1 (LGD3, 40%) from Ba3 (LGD3, 40%);
$110 million second-lien term loan (maturing 2020) to Caa1
(LGD5, 89%) from B3 (LGD5, 89%).
Based in Tampa, Florida, Cunningham Lindsey is a leading provider
of independent loss adjusting and claims management services
worldwide. The company provides global outsourcing solutions for
property and casualty insurance and reinsurance companies and
self-insured corporations in 61 countries. The company generated
revenue of $777 million for 2013.
The principal methodology used in this rating was Moody's Global
Rating Methodology for Insurance Brokers & Service Companies
published in February 2012. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
DARA PETROLEUM: Chapter 11 Case Transferred to E.D. Calif.
----------------------------------------------------------
Debtor: Dara Petroleum, Inc.
dba Watt Avenue Exxon
dba Watt Avenue American
55 Oak Ct # 100
Danville, CA 94526
Case No.: 14-26608
Chapter 11 Petition Date: June 9, 2014
Date Transferred: June 24, 2014
Court: United States Bankruptcy Court
Eastern District of California (Sacramento)
Judge: Hon. Thomas Holman
Debtor's Counsel: Noel Knight, Esq.
LAW OFFICES OF NOEL KNIGHT
710 W. 18th Street, Suite 2
Merced, CA 95340
Tel: 510-435-9210
Email: lawknight@hotmail.com
Total Assets: $0
Total Liabilities: $1.47 million
The petition was signed by Sarbjit Kang, president.
A list of the Debtor's three largest unsecured creditors is
available for free at http://bankrupt.com/misc/caeb14-26608.pdf
The Debtor originally filed its bankruptcy petition in the United
States Bankruptcy Court for the Northern District of California,
Case No. 14-42507.
DEJOUR ENERGY: Has C$2.98-Mil. Net Loss for First Quarter
---------------------------------------------------------
Dejour Energy Inc. filed its quarterly report on Form 10-Q,
disclosing a net loss of C$2.98 million on C$2.27 million of total
revenues for the three months ended March 31, 2014, compared with
a net loss of C$1.21 million on C$1.66 million of total revenues
for the same period in 2013.
The Company's balance sheet at March 31, 2014, showed C$28.48
million in total assets, C$19.98 million in total liabilities, and
stockholders' equity of C$8.51 million.
The Company's ability to continue as a going concern is dependent
upon attaining profitable operations and obtaining sufficient
financing to meet obligations and continue exploration and
development activities. There is no assurance that these
activities will be successful. These material uncertainties cast
substantial doubt upon the Company's ability to continue as a
going concern, according to the Company's regulatory filing.
A copy of the Form 10-Q is available:
http://is.gd/Eqq47x
About Dejour
Dejour Energy Inc. is an independent oil and natural gas
exploration and production company operating projects in North
America's Piceance Basin (approximately 80,000 net acres) and
Peace River Arch regions (approximately 7,500 net acres).
Dejour's seasoned management team has consistently been among
early identifiers of premium energy assets, repeatedly timing
investments and transactions to realize their value to
shareholders' best advantage. Dejour maintains offices in Denver,
USA, Calgary and Vancouver, Canada. The company is publicly
traded on the New York Stock Exchange MKT (nyse mkt:DEJ) and
Toronto Stock Exchange CA:DEJ 0.
DEWEY STRIP: Reorganization Plan Declared Effective June 18
-----------------------------------------------------------
U.S. Bankruptcy Judge Christopher Sontchi has confirmed the Joint
Plan of Reorganization filed by Dewey Strip Holdings LLC and Las
Vegas North Strip Holdings Syndications Group LLC. The joint plan
became effective on June 18, 2014.
The court's confirmation order provides that the Class 2 Junior
Lien Claim is disallowed in its entirety and the junior lien is
avoided, nullified, disallowed, and vacated. Bank of the West
will have a limited right to receive payment of no more than
$3,920,282.
The Plan requires Manchester Leasing Inc. to make a cash capital
contribution to each reorganized debtor to pay in full all
administrative and priority claims, which are not classified under
the plan.
Under the plan, claims of creditors are put into five classes:
Class 1 Senior Secured Claim of Senior Secured Lenders; Class 2
Junior Lien Claim of Junior Lienholders; Class 3 General Unsecured
Claims; Class 4 Unsecured Affiliate Claims of each of the Debtors;
and Class 5 Equity Interest Holders.
Holders of Class 2 through 5 Claims won't receive payments and are
deemed to reject the plan. Meanwhile, holders of claims in Class
1, existing as of Jan. 14, were entitled to vote.
As of June 7, 2013, senior secured lenders hold a $215 million
claim against Dewey Strips and its affiliates, court filings show.
About Dewey Strip
Las Vegas, Nevada-based Dewey Strip Holdings LLC and Las Vegas
North Strip Holdings Syndications Group LLC sought Chapter 11
protection (Bankr. D. Del. Case Nos. 13-11479 and 13-11480) on
June 7, 2013, in Delaware, without stating a reason.
Each debtor, a Single Asset Real Estate as defined in 11 U.S.C.
Sec. 101(51B), estimated at least $10 million in assets and at
least $100 million in liabilities. In its schedules, Dewey Strip
Holdings disclosed $35,000,000 and $243,573,461 in liabilities as
of the Petition Date.
The petitions were signed by Martin H. Walrath, IV, vice-president
of International Property Syndications, Ltd., as manager and sole
member.
Neal L. Wolf, Esq., Mohsin N. Khambati, Esq., John A. Benson, Jr.,
Esq., Michael R. Wanser, Esq. and Sandy Holstrom, Esq., at Neal
Wolf & Associates, LLC, act as bankruptcy counsel to the Debtors.
In February 2014, Neal Wolf merged with and into Much Shelist PC.
Steven K. Kortanek, Esq., Thomas M. Horan, Esq., and Ericka F.
Johnson, Esq., at Womble Carlyle Sandridge & Rice, LLP, serve as
co-counsel.
EFUSION SERVICES: July 10 Deadline to File Reply in Dismissal Bid
-----------------------------------------------------------------
The Bankruptcy Court extended until July 10, 2014, the time to
respond to stipulated facts with respect to the hearing on a
motion to dismiss the bankruptcy case of eFusion Services LLC.
On June 19, creditors John Dorsey, Thomas McCann and Anthony Maley
submitted an unopposed motion for extension stating that:
1. a hearing on creditors' motion is set for July 16;
2. in the Court's order setting evidentiary hearing with
respect to the motion to dismiss, the Court set a deadline of
June 25, 2014, with respect to the parties' filing of stipulated
facts;
3. the parties have scheduled depositions for the week of
June 23, 2014, and counsel for creditors will be out of town all
of the following week; and
4. counsel for creditors has conferred with counsel for the
Debtor and counsel for the EPS Entities, who are not opposed to
the relief sought in the motion.
In a separate order, the Bankruptcy Court said the dismissal
motion will be held in abeyance pending final resolution of the
discovery dispute.
The parties were required to file a joint status report by May 16,
identifying which forum the Debtor filed the action to adjudicate
the disputed matter. If the Debtor fails to file an action within
the time period, either party may file a motion with the
Bankruptcy Court to reschedule a hearing on the motion to dismiss
and the Debtor's objection thereto. If the Debtor timely files an
action, the parties must notify the Bankruptcy Court immediately
upon final resolution of the dispute by the other forum.
About eFusion Services LLC
eFusion Services LLC filed a Chapter 11 bankruptcy petition
(Bankr. D. Colo. Case No. 13-30740) on Dec. 20, 2013. The
petition was signed by Paul Lufkin, Manager of eFusion Management
LLC. The Debtor disclosed, in an amended schedules $39,000,002 in
assets and $32,627,185 in liabilities. The Hon. Michael E. Romero
presides over the case. The Debtor employed Powell Theune PC as
its counsel.
Richard A. Weiland, the U.S. Trustee for Region 19, was not
able to form an Official Committee of Unsecured Creditors in the
bankruptcy case of eFusion Services LLC because there were too
few unsecured creditors who are willing to serve on the Committee.
EFUSION SERVICES: Files Schedules of Assets and Liabilities
-----------------------------------------------------------
eFusion Services LLC filed with the U.S. Bankruptcy Court for the
District of Colorado amended schedules of assets and liabilities,
disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $39,000,002
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $27,407,500
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-Priority
Claims $5,219,685
----------- -----------
Total $39,000,002 $32,627,185
As reported in the Troubled Company Reporter on Dec. 26, 2013, the
Debtor disclosed total assets of $35 million and total debts of
$28.62 million.
About eFusion Services LLC
eFusion Services LLC filed a Chapter 11 bankruptcy petition
(Bankr. D. Colo. Case No. 13-30740) on Dec. 20, 2013. The
petition was signed by Paul Lufkin, Manager of eFusion Management
LLC. The Debtor disclosed total assets of $35 million and total
liabilities of $28.6 million. The Hon. Michael E. Romero presides
over the case. The Debtor employed Powell Theune PC as its
counsel.
Richard A. Weiland, the U.S. Trustee for Region 19, was not
able to form an Official Committee of Unsecured Creditors in the
bankruptcy case of eFusion Services LLC because there were too
few unsecured creditors who are willing to serve on the Committee.
EMPIRE RESORTS: Unit Amends Option Agreement with EPT Concord
-------------------------------------------------------------
Monticello Raceway Management, Inc., a wholly owned subsidiary of
Empire Resorts, Inc., entered into an amendment to an Option
Agreement between MRMI and EPT Concord II, LLC, dated as of
Dec. 21, 2011, as most recently amended by a letter agreement,
dated Dec. 6, 2013. Pursuant to the Option Amendment, MRMI and
EPT have agreed to amend the terms of a ground lease underlying
the Option Agreement.
Pursuant to the Option Amendment, the term of the ground lease has
been amended to expire on the earlier of: (i) the last day of the
calendar month that is 70 years after the commencement of the
ground lease, and (ii) upon MRMI giving EPT written notice of its
election to terminate the ground lease at least 12 months prior to
any one of five Option Dates. The Option Dates under the Option
Agreement Amendment mean each of the 20th, 30th, 40th, 50th and
60th anniversary of the commencement of the ground lease. Upon
MRMI's timely notice of exercise of its Termination Option, the
ground lease will be automatically terminated effective as of the
applicable Option Date. The remaining terms and conditions of the
Option Agreement remain unchanged.
About Empire Resorts
Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY)
-- http://www.empireresorts.com/-- owns and operates Monticello
Casino & Raceway, a video gaming machine and harness racing track
and casino located in Monticello, New York, 90 miles northwest of
New York City.
Empire Resorts reported a net loss applicable to common shares of
$27.05 million in 2013 following a net loss applicable to common
shares of $2.26 million in 2012.
As of March 31, 2014, Empire Resorts had $38.73 million in total
assets, $52.72 million in total liabilities and a $13.98 million
total stockholders' deficit.
ENDO INTERNATIONAL: S&P Affirms 'BB-' CCR & Alters Outlook to Neg.
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Dublin-based pharmaceutical company Endo
International PLC (Endo). S&P revised the rating outlook to
negative from stable reflecting the potential for lower earnings
or more borrowing than we expect.
S&P also affirmed its 'BB+' credit rating on Endo's subsidiary
Endo Luxembourg Finance Co. I S.a.r.l.'s secured debt. The '1'
recovery rating on the secured debt is unchanged, indicating S&P's
expectation for very high (90% to 100%) recovery of principal in
the event of payment default.
At the same time, S&P assigned its 'B+' credit rating to $500
million of senior unsecured notes to be co-issued by Endo Finance
LLC and Endo Finco Inc., also subsidiaries of Endo. S&P assigned
a '5' recovery rating to this debt.
"We raised our credit rating on their existing senior unsecured
notes to 'B+' from 'B'. We revised the recovery rating on this
debt to '5' from '6', indicating our current expectation for
modest (10% to 30%) recovery of principal in the event of payment
default. The recovery rating revision reflects our estimate of
greater value available to unsecured creditors as a result of more
secured debt amortization (because we assume a later default year)
and the addition of businesses we expect Endo to acquire in 2014,
only partly offset by the increased amount of senior unsecured
debt," S&P said.
"Endo's business is in transition. The contribution from highly
profitable branded drugs is declining rapidly because of generic
competition and we expect Endo to lose significant earnings in
2015 when its Voltaren Gel license expires," said credit analyst
Gail Hessol. "The company's much less profitable generic drug
unit continues to expand well above market growth rates, and a
series of mid-sized acquisitions bolster the portfolio of branded
and generic drugs and provide a platform for geographic expansion.
We believe this ongoing product mix shift will significantly
reduce gross profit margins, especially in 2015. Still, product
diversity is improving, which we view favorably."
The rating outlook is negative, reflecting risks to S&P's base-
case forecast that Endo will manage its EBITDA pressure and growth
ambitions such that leverage is generally sustained below 5x.
Downside scenario
Based on S&P's estimate for debt, it could lower the rating if
adjusted EBITDA is less than about $825 million in 2014 and $800
million in 2015. Such a scenario could occur if growth of generic
drugs falters, new branded drugs fail to gain traction, or Endo
does not achieve the cost reductions S&P expects. S&P could also
consider lowering the rating if mesh product liabilities continue
to escalate or the company becomes more aggressive in terms of
acquisition activity.
Upside scenario
S&P could revise the outlook to stable if it gains confidence that
its base-case forecast is comfortably achievable, given the
multiple headwinds currently facing the company.
ERICKSON INC: S&P Revises Outlook to Negative & Affirms 'B' CCR
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
U.S.-based helicopter manufacturer and service provider Erickson
Inc. to negative from stable and affirmed its 'B' corporate credit
rating on the company.
At the same time, S&P affirmed its 'B' issue-level rating on the
company's senior secured notes due 2020. The '3' recovery rating
remains unchanged, indicating S&P's expectation for meaningful
recovery prospects (50%-70%) in the event of a payment default.
The outlook revision reflects Erickson's weaker-than-expected
credit metrics and tighter-than-expected liquidity, which are
largely due to delays in the company's completion of its
acquisition of Air Amazonia Servicos Aeronauticos Ltda. last year;
and slower-than-expected development of the oil and gas business,
which S&P had expected to offset declining U.S. Department of
Defense (DoD)-related demand.
"The rating on Erickson reflects the company's limited end-market
diversity and participation in a relatively small niche market,
where demand can be somewhat unpredictable and competitive
pressures remain significant," said Standard & Poor's credit
analyst Lisa Jenkins. S&P characterizes the company's business
risk profile as "weak" and its financial risk profile as "highly
leveraged," based on its criteria.
The outlook is negative. Erickson's recent performance has been
weaker than S&P expected, partly due to delays in the startup of
its energy-related business and softer-than-expected DoD demand.
This has resulted in weaker-than-expected liquidity, which also
reflects the seasonal pattern of the company's cash flow. The
company is taking steps to bolster liquidity, and S&P believes
that these efforts, combined with increased cash flow generation
during the second half of the year will result in a greater
liquidity cushion as the year progresses.
S&P could lower the rating if Erickson's liquidity does not
improve as it expects and it revises the liquidity assessment to
"less than adequate" from "adequate," or if debt to EBITDA stays
above 6.5x for an extended period.
S&P could revise the outlook to stable if Erickson's liquidity
strengthens and S&P believes the company will maintain liquidity
at a level that would continue to support an "adequate"
assessment, and if debt to EBITDA stays below 5.5x.
ESTATE FINANCIAL: Bank of New York Mellon Gets Stay Relief
----------------------------------------------------------
The Hon. Peter H. Carroll of the U.S. Bankruptcy Court for the
Central District of California entered on June 11, 2014, an order
granting the unopposed motion of The Bank of New York Mellon Trust
Company, N.A., as Trustee for Chase Mortgage Finance Corporation
Multi-Class Mortgage Pass-Through Certificates ChaseFlex Trust,
Series 2007-3, its assignees and successors, by and through its
servicing agent Select Portfolio Servicing, Inc., to terminate the
automatic stay with respect to Estate Financial, Inc.'s real
property at 354 24th Street, Paso Robles, CA 93446.
The Bank may enforce its remedies to foreclose upon and obtain
possession of the Property in accordance with applicable
nonbankruptcy law, but may not pursue any deficiency claim against
the Debtor or property of the estate except by filing a proof of
claim pursuant to 11 U.S.C. Section 501.
The Bank's interest in the Property is not adequately protected.
Its interest in the collateral is not protected by an adequate
equity cushion. Pursuant to 11 U.S.C. Section 362(d)(2)(A), the
Debtor has no equity in the Property, and pursuant to Section
362(d)(2)(B), the Property is not necessary to an effective
reorganization.
A copy of the motion is available for free at:
http://bankrupt.com/misc/ESTATEFINANCIAL_3060_stay.pdf
The Bank is represented by:
JaVonne M. Phillips, Esq.
Kelly M. Raftery, Esq.
McCarthy & Holthus, LLP
1770 Fourth Avenue
San Diego, California 92101
Tel: (619) 685-4800 Ext. 1834
Fax: (619) 685-4810
E-mail: bknotice@mccarthyholthus.com
About Estate Financial
Estate Financial, Inc. -- http://www.estatefinancial.com/-- was a
license real estate brokerage firm since the later 1980's. EFI
solicited funding for, and arranged and made, loans secured by
various real property. EFI also was the sole manager of Estate
Financial Mortgage Fund LLC, which was organized for the purpose
of investing in and funding loans originated by EFI which were
secured by first deeds of trust encumbering commercial and real
estate located primarily in California and has been funding such
mortgage loans since 2002.
Five creditors of EFI filed an involuntary Chapter 11 petition
against the real estate broker on June 25, 2008 (Bankr. C.D.
Calif. Case No. 08-11457). EFI consented to the bankruptcy
petition on July 16, 2008.
Robert B. Orgel, Esq., at Pachulski Stang Ziehl & Jones LLP, and
William C. Beall, Esq., at Beall and Burkhardt, represented the
Debtor as counsel. A Chapter 11 trustee, Thomas P. Jeremiassen,
was appointed by the Court on July 23, 2008. Robyn B. Sokol,
Esq., and Steven T. Gubner, Esq., at Ezra Brutzkus & Gubner,
represent the official committee of unsecured creditors as
counsel. In its schedules, Estate Financial disclosed total
assets of $27,428,550, and total debts of $7,316,755.
EWGS INTERMEDIARY: Can Use Cash Collateral Through July 31
----------------------------------------------------------
The Bankruptcy Court has authorized, on a final basis, EWGS
Intermediary, et al., to use cash collateral in which the
subordinated lenders -- PNC Bank, National Association, and EW
Golf Holding Corp. -- assert an interest.
As adequate protection, the subordinated lenders are granted
allowed superpriority administrative expense claims. As further
adequate protection, the Debtors are authorized to provide
adequate protection to the subordinated lenders in the form of
ongoing payment of its reasonable fees, costs, and expenses
including without limitation reasonable legal and other
professionals' fees and expenses in an amount not to exceed
$50,000 a month, which will not be subject to the budget. The
Debtors are also authorized and directed to remit $2 million to
the subordinated lenders for application to the secured
subordinated note obligations.
The cash collateral order will be terminated upon the earlier of
an event of default or July 31, 2014, provided that the
subordinated lenders will have the discretion to extend the use of
the cash collateral.
About EWGS Intermediary
EWGS Intermediary and Edwin Watts Golf Shops, which operate as an
integrated, multi-channel retailer, offering brand name golf
equipment, apparel and accessories, filed for Chapter 11
protection on Nov. 4, 2013 (Bankr. D. Del. Lead Case No.
13-12876). They are represented by Domenic E. Pacitti, Esq., and
Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg
LLP, in Wilmington, Delaware. The Debtors tapped Bayshore
Partners LLC as their investment banker, FTI Consulting, LLC, as
their financial advisors, and Epiq Bankruptcy Solutions, LLC, as
claims and noticing agent.
PNC Bank, National Association, the DIP Agent, is represented by
Regina Stango Kelbon, Esq., at Blank Rome LLP, in Wilmington,
Delaware.
Lawrence C. Gottlieb, Esq., Jay R. Indyke, Esq., Brent Weisenberg,
Esq., at Cooley LLP, serve as lead counsel to the Official
Committee of Unsecured Creditors. Michael J. Merchant, Esq.,
Christopher M. Samis, Esq., and William A. Romanowies, Esq., at
Richards, Layton & Finger, P.A. serve as Delaware counsel. The
Committee hired PricewaterhouseCoopers LLP as its financial
adviser.
The Debtors said total assets are greater than $100 million. In
its schedules, EWGS Intermediary disclosed $0 in assets and
$77,801,784 in total liabilities.
Hilco Merchant Resources, a unit of Hilco Global, on Dec. 5, 2013,
disclosed that it has completed a $40 million deal to purchase all
the assets of golf retail brand Edwin Watts, in partnership with
GWNE, Inc., an affiliate of Worldwide Golf Shops. The transaction
was approved by the bankruptcy court and closed on Dec. 5.
EWGS INTERMEDIARY: Files Amended Joint Plan of Liquidation
----------------------------------------------------------
EWGS Intermediary and Edwin Watts Golf Shops filed an amended
version of their proposed liquidating plan early this month.
The Amended Joint Plan of Liquidation dated June 5, 2014, is a
provides for the liquidation of the Debtors' assets and the
payment of the proceeds generated therefrom to creditors in
accordance with the priorities set forth in the Bankruptcy Code.
The Plan Administrator will pursue any third party claims by
informal demand and/or by the commencement of litigation in any
court of competent jurisdiction, with the net recoveries of such
third party claims to be distributed in accordance with the plan
administrator agreement.
The primary means by which the Debtors will implement the Plan is
through the Plan Administrator.
Allowed administrative claims, including professional claims,
substantial contribution claims, ordinary course expenses, allowed
priority non tax claims and the allowed priority tax claims will
be paid in full under the Plan.
The amount of the Plan distribution on account of Class 1 Claims
and Class 4 General Unsecured Claims cannot be determined with
certainty. The Debtors estimate, however, that the Plan Assets to
be distributed by the Plan Administrator will be $7,772,000
inclusive of the amount assigned for the benefit of holders of
allowed general unsecured claims pursuant to proceeds sharing
agreement.
A copy of the Amended Plan is available for free at:
http://is.gd/gkJ0jR
About EWGS Intermediary
EWGS Intermediary and Edwin Watts Golf Shops, which operate as an
integrated, multi-channel retailer, offering brand name golf
equipment, apparel and accessories, filed for Chapter 11
protection on Nov. 4, 2013 (Bankr. D. Del. Lead Case No.
13-12876). They are represented by Domenic E. Pacitti, Esq., and
Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg
LLP, in Wilmington, Delaware. The Debtors tapped Bayshore
Partners LLC as their investment banker, FTI Consulting, LLC, as
their financial advisors, and Epiq Bankruptcy Solutions, LLC, as
claims and noticing agent.
PNC Bank, National Association, the DIP Agent, is represented by
Regina Stango Kelbon, Esq., at Blank Rome LLP, in Wilmington,
Delaware.
Lawrence C. Gottlieb, Esq., Jay R. Indyke, Esq., Brent Weisenberg,
Esq., at Cooley LLP, serve as lead counsel to the Official
Committee of Unsecured Creditors. Michael J. Merchant, Esq.,
Christopher M. Samis, Esq., and William A. Romanowies, Esq., at
Richards, Layton & Finger, P.A. serve as Delaware counsel. The
Committee hired PricewaterhouseCoopers LLP as its financial
adviser.
The Debtors said total assets are greater than $100 million. In
its schedules, EWGS Intermediary disclosed $0 in assets and
$77,801,784 in total liabilities.
Hilco Merchant Resources, a unit of Hilco Global, on Dec. 5, 2013,
disclosed that it has completed a $40 million deal to purchase all
the assets of golf retail brand Edwin Watts, in partnership with
GWNE, Inc., an affiliate of Worldwide Golf Shops. The transaction
was approved by the bankruptcy court and closed on Dec. 5.
FIRST PHILADELPHIA: 6501 NSR Wants Clarification on Plan Terms
--------------------------------------------------------------
6501 NSR, LLC filed a response in connection with First
Philadelphia Holdings, LLC's Amended Disclosure Statement
explaining the Amended Plan of Liquidation dated March 26, 2014.
6501 NSR requires clarification on these matters:
a) The Amended Plan appears to provide for the possible
transfer of the Debtor's property to Pennsylvania Infrastructure
Investment Authority (PennVest) in the highly unlikely event that
there is not an auction with respect to the property; and
b) The Amended Plan addresses the unlikely event that the
property is not sold pursuant to the bid procedures, and provides
for the possible surrender of the property to 6501 NSR.
6501 NSR reserves the right to raise additional matters at the
hearing scheduled for June 19, regarding confirmation of the
Debtor's Amended Plan.
6501 NSR is represented by:
Paul A. Patterson, Esq.
Julie M. Murphy, Esq.
STRADLEY RONON STEVENS & YOUNG, LLP
2600 One Commerce Esquire
Philadelphia, PA 19103
Tel: (215) 564-8052
Fax: (215) 564-8120
As reported in the Troubled Company Reporter on June 19, 2014,
PENNVEST asked the Court to deny the confirmation of the Debtor's
Plan.
According to PENNVEST, the Debtor's Amended Disclosure Statement,
as approved, fails to disclose how the Debtor can satisfy the
requirement of the U.S. Bankruptcy Code without any operations or
independent source of funding except the payment by the Debtor's
sole member George Diemer.
As reported in the TCR on April 9, 2014, the Debtor proposed a
Liquidating Plan, where it sought to accomplish payments by (i)
marketing its real estate for sale, (ii) making payment to its
secured creditors from the proceeds of the sale, and (iii) making
payment to unsecured creditors funded by Mr. Diemer, who has
committed to fund a $20,000 distribution.
The real property in question is located at 6501 New State Road
aka Tacony Street, Philadelphia, Pennsylvania.
Chief Judge Gloria M. Burns approved the Disclosure Statement, as
amended, describing the Plan on March 26, 2014. A copy of the
Disclosure Statement is available for free at:
http://bankrupt.com/misc/FIRSTPHILADELPHIA_AmdDSMar26.pdf
About First Philadelphia Holdings, LLC
First Philadelphia Holdings, LLC, is a Pennsylvania limited
liability company formed on or about March 14, 2005. The Debtor
is headquartered in New Jersey and is in the business of owning
real estate located at 6501 New State Road a/k/a Tacony Street,
Philadelphia, Pennsylvania.
The Company filed a Chapter 11 petition (Bankr. D.N.J. Case No.
12-39767) on Dec. 21, 2012. The Debtor scheduled $15,000,000 in
assets and $10,346,981 in liabilities as of the Chapter 11 filing.
Judge Gloria M. Burns presides over the case.
Maureen P. Steady, Esq., who has an office in Marlton, New Jersey,
serves as the Debtor's bankruptcy counsel. In its schedules, the
Debtor disclosed $15,000,000 in total assets and $10,346,981 in
total liabilities.
No official committee of unsecured creditors, trustee or examiner
has been appointed in the Debtor's Chapter 11 case.
FUSION TELECOMMUNICATIONS: Amends 8.4MM Shares Resale Prospectus
----------------------------------------------------------------
Fusion Telecommunications International, Inc., amended its
registration statement relating to the resale of an aggregate of
8,414,904 shares of common stock of the Company which may be
offered from time to time by Diker GP, LLC, First Prestige Group
Limited, Robert L Patron, et al.
The shares being resold consist of:
* 1,213,040 shares of issued and outstanding common stock;
* 4,049,100 shares of common stock issuable upon conversion of
outstanding Series B-2 Preferred Stock; and
* 3,152,764 shares of common stock issuable upon exercise of
outstanding common stock purchase warrants.
The Company will not receive any proceeds from the sale of these
shares by the selling security holders, but the Company may
receive proceeds from the exercise of the warrants, if exercised.
These shares are being registered to permit the selling security
holders to sell shares of common stock from time to time, in
amounts, at prices and on terms determined at the time of sale.
The Company's common stock is currently quoted on The Nasdaq
Capital Market and trades under the symbol "FSNN." On June 17,
2014, the closing price for the Company's common stock was $6.66
per share.
A full-text copy of the amended Form S-1 registration statement is
available for free at http://is.gd/sCQLYj
About Fusion Telecommunications
New York City-based Fusion Telecommunications International, Inc.
(OTC BB: FSNN) is a provider of Internet Protocol ("IP") based
digital voice and data communications services to corporations and
carriers worldwide.
Fusion Telecommunications incurred a net loss applicable to common
stockholders of $5.48 million in 2013, a net loss applicable to
common stockholders of $5.61 million in 2012 and a net loss of
$4.45 million in 2011. The Company's balance sheet at March 31,
2014, showed $69.69 million in total assets, $58.51 million in
total liabilities and $11.18 million in total stockholders'
equity.
G-I HOLDINGS: 3d Cir. Allows U.S. Gypsum, Quigley to Pursue Claims
------------------------------------------------------------------
Due to the rising number of asbestos-related personal injury
lawsuits filed in the 1980s, a group of producers of asbestos and
asbestos-containing products joined together and formed the Center
for Claims Resolution to administer asbestos personal injury
claims on behalf of the Members. The Members negotiated and
signed the Producer Agreement Concerning Center for Claims
Resolution, which established and set forth the mechanics of the
Center and the obligations of the Members. Appellants United
States Gypsum Company and Quigley Company, Inc., and the
predecessor-in-interest of Appellee G-I Holdings, Inc., were among
the roughly twenty asbestos producers who signed the Producer
Agreement, thereby becoming Members of the Center.
After G-I failed to pay its contractually-calculated share due to
pay out personal injury settlements and cover Center expenses,
U.S. Gypsum and Quigley were obligated to pay additional sums to
cover G-I's payment obligations. G-I filed for bankruptcy and the
Center, U.S. Gypsum, and Quigley each filed a proof of claim in
the Bankruptcy Court seeking to recover for G-I's nonpayment under
the Producer Agreement. The Center eventually settled its claim
with G-I.
Although arising in the context of a bankruptcy proceeding, the
case concerns claims for breach of contract under Delaware law.
The U.S. Court of Appeals for the Third Circuit are asked to
decide whether, under the Producer Agreement, U.S. Gypsum and
Quigley may maintain a breach of contract action against G-I.
The Circuit Court, in an opinion dated June 17, 2014, held that
the Producer Agreement permits the Former Members to pursue a
breach of contract action against G-I for its failure to pay
contractually-obligated sums due to the Center, in light of the
Former Members' payment of G-I's share. The Circuit Court
therefore vacate the District Court's order affirming the
Bankruptcy Court's grant of summary judgment in G-I's favor.
The case IN RE: G-I HOLDINGS, INC., formerly known as GAF
Corporation, Debtor: UNITED STATES GYPSUM COMPANY, Appellant No.
13-3335, and QUIGLEY COMPANY, INC., Appellant No. 13-3336 (3d.
Cir.). A full-text copy of the Decision is available at
http://is.gd/X34X1Bfrom Leagle.com.
Appellant United States Gypsum Co. is represented by:
Rachel S. Bloomekatz, Esq.
JONES DAY
325 John H. McConnell Boulevard, Suite 600
P.O. Box 165017
Columbus, OH 43215
Email: rbloomekatz@jonesday.com
-- and --
Brad B. Erens, Esq.
Brian J. Murray, Esq.
JONES DAY
77 West Wacker Drive, Suite 3500
Chicago, IL 60601
Email: bberens@jonesday.com
bjmurray@jonesday.com
Counsel for Appellant Quigley Co. Inc.:
John P. DiIorio, Esq.
SHAPIRO CROLAND
411 Hackensack Avenue
Hackensack, NJ 07601
Email: jdiiorio@shapiro-croland.com
-- and --
Stephen D. Hoffman, I, Esq.
WILK AUSLANDER
1515 Broadway, 43rd Floor
New York, NY 10036
Email: shoffman@wilkauslander.com
Counsel for Appellees:
Mark E. Hall, Esq.
Dennis J. O'Grady, Esq.
RIKER, DANZIG, SCHERER, HYLAND & PERRETTI
One Speedwell Avenue
Headquarters Plaza
Morristown, NJ 07962-0000
Email: mhall@riker.com
dogrady@riker.com
-- and --
Andrew J. Rossman, Esq.
Scott C. Shelley, Esq.
Jacob J. Waldman, Esq.
QUINN, EMANUEL, URQUHART & SULLIVAN
51 Madison Avenue, 22nd Floor
New York, NY 10010
Email: andrewrossman@quinnemanuel.com
scottshelley@quinnemanuel.com
jacobwaldman@quinnemanuel.com
About G-I Holdings
Based in Wayne, New Jersey, G-I Holdings, Inc., is a holding
company that indirectly owns Building Materials Corporation of
America, a manufacturer of premium residential and commercial
roofing products. The Company filed for bankruptcy after already
spending $1.5 billion paying asbestos claims from the 1967
acquisition of Ruberoid Co.
G-I Holdings, Inc., fka GAF Corporation, filed a chapter 11
petition (Bankr. D. N.J. Case No. 01-30135) on Jan. 5, 2001, and
continued to operate its business as a debtor-in-possession
pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code.
ACI, Inc., a subsidiary of G-I Holdings, filed a voluntary chapter
11 petition (Bankr. D. N.J. Case No. 01-38790) on Aug. 3, 2001.
On Oct. 10, 2001, the Bankruptcy Court entered an Order directing
the joint administration of the G-I Holdings and ACI bankruptcy
cases.
Dennis J. O'Grady, Esq., and Mark E. Hall, Esq., at Riker, Danzig,
Scherer, Hyland & Perretti, LLP, serve as co-counsel to the
Reorganized Debtors. Andrew J. Rossman, Esq., and Jacob J.
Waldman, Esq., at Quinn Emanuel, Urquhart & Sullivan, LLP, serve
as special counsel to Reorganized Debtors.
An Official Committee of Unsecured Creditors was appointed on
Jan. 18, 2001, by the U.S. Trustee to represent those individuals
who allegedly suffered injuries related to asbestos exposure from
products manufactured by the predecessors of G-I Holdings.
Lowenstein Sandler PC represents the Unsecured Creditors
Committee. On Oct. 10, 2001, the Bankruptcy Court appointed C.
Judson Hamlin as the Legal Representative, a fiduciary to
represent the interests of persons who hold present and future
asbestos-related claims against G-I. Keating, Muething & Klekamp,
P.L.L., is the principal counsel to the Legal Representative of
Present and Future Asbestos-Related Demands.
G-I Holdings is the successor-in-interest to GAF Corporation, an
entity named in approximately 500,000 asbestos-related lawsuits.
The Committee submitted that, as successor-in-interest to GAF, G-I
Holdings remained liable for roughly 150,000 asbestos-related
lawsuits filed, but unresolved, as of the Petition Date and for
unknown numbers of asbestos-related claims that would be filed in
the future.
In early 1994, GAF Building Materials Corporation, an indirect
subsidiary of GAF, formed a new corporation as a wholly-owned
subsidiary known as Building Materials Corporation of America.
Pursuant to that transaction, BMCA received substantially all of
the assets of GAF's roofing products business and expressly
assumed $204 million of asbestos-related liability, with G-I
indemnifying BMCA against any additional such liability. BMCA,
also an indirect subsidiary of G-I Holdings, is the primary
operating subsidiary and principal asset of G-I Holdings.
In early 2007, the Debtors, the Committee and the Legal
Representative commenced mediation under the auspices of former
United States District Judge Nicholas H. Politan in an effort to
resolve the asbestos-related lawsuits. Subsequently, the Parties
outlined the principal terms of a global settlement and endeavored
to complete a final global settlement with comprehensive
documentation in the form of a proposed Chapter 11 plan and its
ancillary documents. To preserve the status quo, the Parties
mutually agreed to request a stay of all litigation which would be
covered under the final global settlement from this Court and
other courts of competent jurisdiction. Although lengthy and
initially unsuccessful, the negotiations continued until the
parties reached a settlement culminating in an agreement in early
August 2008.
On Aug. 21, 2008, the Parties filed the Joint Plan of
Reorganization of G-I Holdings Inc. and ACI Inc. Pursuant to
Chapter 11 of the Bankruptcy Code that implemented the Global
Settlement of all asbestos-related lawsuits naming G-I Holdings
and any other related entities as defendant(s). The Joint Plan of
Reorganization provided for the creation of an asbestos trust
pursuant to Section 524(g) of the Bankruptcy Code, to which all
asbestos-related lawsuits against the Debtors now and in the
future would be channeled. Pursuant to the Global Settlement, the
Asbestos Trust would assume the Debtors' liability for asbestos-
related lawsuits, in exchange for cash on the effective date of
the Joint Plan of Reorganization in an amount not to exceed $215
million, and a note in the amount of $560 million issued by the
reorganized Debtors and secured by a letter of credit.
The Bankruptcy Court and Chief Judge Garrett Brown of the U.S.
District Court for the District of New Jersey, by Order dated Nov.
12, 2009, jointly approved the Debtors' Eighth Amended Joint Plan
of Reorganization.
GARLOCK SEALING: July 15 Hearing Set for Bids to Access Files
-------------------------------------------------------------
Magistrate Judge Dennis L. Howell of the United States District
Court for the Western District of North Carolina, Charlotte
Division, issued an order on June 11, 2014, scheduling a hearing
on July 15, 2014, in Garlock Sealing Technologies, LLC's Chapter
11 case to consider the approval of various pending motions in
connection with the requests for access to sealed documents
relating to asbestos claims and claimants in Garlock's bankruptcy
case.
The case is IN RE: GARLOCK SEALING TECHNOLOGIES, LLC, DOCKET NO.
3:13-CV-00464-MOC (W.D.N.C.). A full-text copy of the magistrate
judge's decision is available at http://is.gd/js9PzKfrom
Leagle.com.
Mt. McKinley Insurance Company, Appellant, represented by Fred L.
Alvarez, Esq. -- falvarez@wwmlawyers.com -- at Walker Wilcox
Matousek, LLP; and J. Samuel Gorham, III, Esq., at Gorham & Crone,
PLLC.
Everest Reinsurance Company, Appellant, represented by Fred L.
Alvarez, Esq., at Walker Wilcox Matousek, LLP; and J. Samuel
Gorham, III, Esq., at Gorham & Crone, PLLC.
Garlock Sealing Technologies LLC, Appellee, represented by Albert
Franklin Durham, Esq. -- adurham@rcdlaw.net -- John R. Miller,
Jr., Esq. -- jmiller@rcdlaw.net -- Michelle Elizabeth Earp, Esq.,
Ross Robert Fulton, Esq. -- rfulton@rcdlaw.net -- Shelley Koon
Abel, Esq. -- sabel@rcdlaw.net -- and William Samuel Smoak, Jr.,
Esq., at at Rayburn, Cooper & Durham, P.A.; and Garland Stuart
Cassada, Esq. -- gcassada@rbh.com -- Jonathan C. Krisko, Esq. --
jkrisko@rbh.com -- Louis Adams Bledsoe, III, Esq. --
lbledsoe@rbh.com -- and Richard Charles Worf, Jr., Esq. --
rworf@rbh.com -- at Robinson, Bradshaw & Hinson, P. A.,
Official Committee of Asbestos Personal Injury Claimants,
Appellee, represented by Andrew Thomas Houston, Esq. --
ahouston@mwhattorneys.com -- Richard Steele Wright, Esq. --
rwright@mwhattorneys.com -- and Travis Waterbury Moon, Esq. --
tmoon@mwhattorneys.com -- at Moon Wright & Houston, PLLC; and
Trevor W. Swett, III, Esq. -- tswett@capdale.com -- at Caplin &
Drysdale, Chartered.
Coltec Industries, Inc., Intervenor, represented by E. Taylor
Stukes, Esq. -- taylorstukes@mvalaw.com -- and Mark Andrew Nebrig,
Esq. -- marknebrig@mvalaw.com -- at Moore & Van Allen.
About Garlock Sealing
Headquartered in Palmyra, New York, Garlock Sealing Technologies
LLC is a unit of EnPro Industries, Inc. (NYSE: NPO). For more
than a century, Garlock has been helping customers efficiently
seal the toughest process fluids in the most demanding
applications.
On June 5, 2010, Garlock filed a voluntary Chapter 11 petition
(Bankr. W.D.N.C. Case No. 10-31607) in Charlotte, North Carolina,
to establish a trust to resolve all current and future asbestos
claims against Garlock under Section 524(g) of the U.S. Bankruptcy
Code. The Debtor estimated $500 million to $1 billion in assets
and up to $500 million in debts as of the Petition Date.
Affiliates The Anchor Packing Company and Garrison Litigation
Management Group, Ltd., also filed for bankruptcy.
Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A.,
represents the Debtor in their Chapter 11 effort. Garland S.
Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel
for asbestos matters.
The Official Committee of Asbestos Personal Injury Claimants in
the Chapter 11 cases is represented by Travis W. Moon, Esq., at
Hamilton Moon Stephens Steele & Martin, PLLC, in Charlotte, NC,
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, in New
York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and
Jeanna Rickards Koski, Esq., in Washington, D.C. 20005.
Joseph W. Grier, III, the Court-appointed legal representative for
future asbestos claimants, has retained A. Cotten Wright, Esq., at
Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan
P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his co-
counsel.
Judge George Hodges of the United States Bankruptcy Court for the
Western District of North Carolina on Jan. 10, 2014, entered an
order estimating the liability for present and future mesothelioma
claims against EnPro Industries' Garlock Sealing Technologies LLC
subsidiary at $125 million, consistent with the positions GST put
forth at trial.
GENERAL MOTORS: U.S. Prosecutors Issue Subpoenas in Probe
---------------------------------------------------------
Jeff Bennett, writing for The Wall Street Journal, reported that
federal prosecutors are issuing grand jury subpoenas in connection
with General Motors Co.'s years-long delay in responding to a
deadly defect, as new documents raise questions about the auto
maker's assessment of which employees were at fault.
According to the report, Delphi Automotive PLC said it has
received a grand jury subpoena and turned over documents relating
to the production and design of ignition switches used in 2.6
million GM cars built during the previous decade.
GM had previously disclosed a Justice Department investigation,
but the subpoenas are a sign that the probe is picking up steam,
the Journal said. The automaker has already paid $35 million to
settle charges that it violated federal auto safety regulations;
however, a criminal investigation by a federal grand jury could
pose a much larger threat, the Journal added.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
-- http://www.gm.com/-- is one of the world's largest automakers,
traces its roots back to 1908.
General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing. The U.S. government
provided financing. The deal was closed July 10, 2009, and Old GM
changed its name to Motors Liquidation Co.
Old GM -- General Motors Corporation -- 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. The Debtors tapped Weil, Gotshal & Manges LLP
Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as
counsel; and Morgan Stanley, Evercore Partners and the Blackstone
Group LLP as financial advisor. 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 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.
HANESBRANDS INC: DB Apparel Deal No Impact on Moody's 'B1' CFR
--------------------------------------------------------------
Moody's Investors Service said that Hanesbrands Inc. (Ba1 stable)
announcement that it has entered into an agreement to acquire to
acquire DB Apparel ("DBA") is viewed as a positive transaction for
the company, as this will significantly strengthen Hanesbrands
global franchise with only a moderate impact on financial metrics.
There is no immediate impact on the company's B1 Corporate Family
Rating or the stable rating outlook.
HAYDEL PROPERTIES: Has Until July 3 to Respond to Dismissal Bid
---------------------------------------------------------------
The Bankruptcy Court, in a minute entry for the June 19 hearing on
creditor The Peoples Bank, Biloxi Mississippi's motion to dismiss
the Chapter 11 case of Haydel Properties, LP, directed the
Debtor's counsel to submit a response brief by July 3, 2014.
As reported by the Troubled Company Reporter, Peoples Bank said it
has made good faith efforts to provide refinancing of the debt
owed to it, but the Debtor has engaged in a pattern of delay, and
unreasonable refusal to execute upon the Debtor's obligations owed
to the bank pursuant to the Plan of Reorganization which was
approved Aug. 23, 2013.
The Debtor, however, has urged the Court to reject Peoples Bank's
dismissal request, saying that the bank is demanding that the
Debtor give the bank a better lien position by requiring that all
properties secured by the multiple deeds of trust held by Peoples
Bank secure the entire obligation of Peoples Bank on the its
modified claim. The Debtor contends it is within its rights to
refuse to succumb to the demands made by Peoples Bank.
About Haydel Properties LP
Haydel Properties LP, based in Biloxi, Mississippi, filed for
Chapter 11 bankruptcy (Bankr. S.D. Miss. Case No. 12-50048) on
Jan. 11, 2012. Judge Katharine M. Samson presides over the case.
Christy Pickering serves as accountant. The Debtor disclosed
$11.7 million in assets and $6.8 million in liabilities as of the
Chapter 11 filing.
The Debtor is represented by Robert Gambrell, Esq., at Gambrell &
Associates, PLLC, and Patrick A. Sheehan, at Sheehan & Johnson,
PLLC.
The Debtor won confirmation of its First Amended Plan of
Reorganization. The Plan was conceived by management as an
alternative to the more drastic measures available for
restructuring the Company's debt, such as total liquidation of
equipment and properties. The Debtor will continue to operate the
rental business and market numerous parcels of real property.
HILCORP ENERGY: Moody's Rates New Sr. Unsecured Notes 'Ba3'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Hilcorp Energy
I, L.P. and co-issuer Hilcorp Finance Company's senior unsecured
notes due 2024. Note proceeds will be used to fund a portion of
the consideration for certain acquisitions which the company is in
the process of closing, the largest being a $1.2 billion
acquisition from BP plc (BP, A2 stable) of interests in three
Alaskan North Slope oil fields. The outlook is stable.
Ratings assigned:
Senior unsecured notes rating, assigned Ba3, LGD5 (74%)
LGD point estimate changes:
Existing senior unsecured notes, to LGD5 (74%) from LGD4 (69%)
Ratings Rationale
"While debt financing the acquisitions is a leveraging
transaction, Hilcorp has ample available debt capacity within its
current Ba2 rating to accommodate the proposed increase in debt
levels, with debt leverage pro forma for the acquisition financing
remaining well below that of its peers," commented Andrew Brooks,
Moody's Vice President. "However, notwithstanding its three-year
operating presence in Alaska's Cook Inlet, Hilcorp's pending
expansion to the North Slope and its harsh operating environment
will not be without execution risk, which will initially weigh on
the rating."
Hilcorp's Ba2 Corporate Family Rating (CFR) reflects its record of
strong production and reserves growth, which in 2014's first
quarter averaged 114 thousand barrels of oil equivalent (Boe) per
day and 462.5 million Boe at year-end 2013, respectively, and very
low debt leverage. Its modest debt levels reflect the accumulation
of cash and the de-leveraging effect of asset sales. In late 2011,
Hilcorp sold its 46% stake in Hilcorp Resources LLC, which held
acreage in the Eagle Ford Shale, to Marathon Oil Corporation (MRO,
Baa1 stable), receiving a $1.8 billion distribution. This and
proceeds from certain subsequent asset sales funded an almost 50%
reduction in debt to under $8,000 per Boe of average daily
production, as well as providing the funding for acquisitions in
Alaska and South Texas, and acreage in the Utica Shale. While
providing geological diversification from its traditional Texas-
Louisiana Gulf Coast base of operations, Alaska and the Utica are
new operating areas for Hilcorp, potentially introducing an
element of execution risk to Hilcorp's acquire and exploit growth
strategy. The Ba2 rating also recognizes the high call on future
cash flow for asset retirement obligations of $984 million at
March 31, 2014. The rating further considers the control Mr.
Jeffery Hildebrand wields over Hilcorp's operations through his
ownership of its general partner; however, Moody's note that the
company has prospered under his control and leadership.
Moody's expect Hilcorp to remain in a strong liquidity position
through 2015. At March 31, Hilcorp had cash and marketable
securities of $158 million, and its $650 million secured borrowing
base revolving credit facility, scheduled to mature in July 2016,
was fully available. In May 2014, the borrowing base was increased
to $1.4 billion, with the entire amount fully available. Cash
requirements for pending acquisitions will approximate $1.0
billion, funded through the proposed notes offering and borrowings
under Hilcorp's revolver. Hilcorp is expected to generate positive
free cash flow before acquisitions in 2015, with excess cash flow
available to then reduce revolving credit balances. The revolver
has two maintenance financial covenants, a minimum current ratio
of 1.0x, and a maximum total debt to EBITDA ratio of 4.25x, under
both of which Hilcorp was fully compliant at March 31. Given the
relatively modest size of the revolver's borrowing base compared
to its estimated $7.4 billion year-end 2013 PV-10, Hilcorp has
access to alternative sources of liquidity, such as asset sales,
if needed to further bolster its liquidity.
The Ba3 rating on its senior unsecured notes reflects their
subordinate position to Hilcorp's $1.4 billion secured borrowing
base revolving credit's priority claim to the company's assets.
The size of the senior secured claims relative to Hilcorp's
outstanding senior unsecured notes results in the notes being
rated one notch below the Ba2 CFR under Moody's Loss Given Default
Methodology.
The stable outlook reflects Hilcorp's growing production through
its low-risk exploitation strategy, and its very modest debt
levels. While there is the realization that Hilcorp could further
re-lever its balance sheet in the future, an upgrade could be
considered should Hilcorp's production reach 130,000 Boe per day
on a consistent basis while maintaining debt to average daily
production below $15,000 per Boe, and presuming it successfully
manages its Alaskan North Slope acquisition for growth value
accretion. Moody's would further expect that Hilcorp's growth
strategy not materially deviate from its historic focus on the
acquisition of mature, longer-lived assets whose potential avail
themselves to future exploitation. A downgrade is possible should
Hilcorp materially re-lever its capital structure to in excess of
$20,000 per Boe of average daily production, or should debt
materially increase to fund a major acquisition or dividends.
Hilcorp is a private limited partnership headquartered in Houston,
Texas. The company's primary producing assets are located in
Alaska, Texas, Louisiana and the Utica Shale in Pennsylvania and
Ohio.
The principal methodology used in this rating was the Global
Independent Exploration and Production Industry published in
December 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.
HLX PLY HOLDINGS: S&P Assigns 'B' CCR & Rates $555MM Credit 'B'
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to HLX PLY Holdings Inc. (Hilex). At the same time,
S&P assigned a 'B' issue-level rating to the company's proposed
$555 million senior secured credit facilities. The recovery
rating is '3', indicating S&P's expectation for meaningful (50% to
70%) recovery in the event of payment default. All ratings are
based on preliminary terms and conditions. The outlook is stable.
The proposed senior secured credit facilities, along with a $40
million mezzanine loan (unrated), will be used to fund the
acquisition of Duro, refinance existing indebtedness, and pay
transaction fees and expenses. S&P expects that the $85 million
revolving credit facility will be modestly drawn at close of
transaction.
"The ratings on Hilex reflect the company's relatively low EBITDA
margins, limited geographic diversity, the threat of legislation
banning plastic bags in certain jurisdictions, and the potential
that over time changing consumer preferences could lead to reduced
demand for paper and plastic bags," said Standard & Poor's credit
analyst Daniel Krauss. Somewhat offsetting this is the reasonable
level of debt leverage at close of the transaction, the company's
favorable market share, and competitive advantages, including in-
house recycling capabilities and effective raw material pass-
through provisions.
With pro forma revenues of about $1.3 billion, the company is a
leading U.S. manufacturer of plastic and paper bags, as well as
films which primarily service the retail, grocery, and food
service end markets. S&P's assessment of the company's business
risk profile as "weak" and financial risk profile as "highly
leveraged" results in a 'b-/b' anchor score. S&P has selected
'b', reflecting its expectation that credit measures will be
maintained at the stronger end of the highly leveraged financial
risk band.
"The outlook is stable. Based on Standard & Poor's outlook for
modest U.S. GDP growth and increased consumer spending in 2014 and
2015, we expect that EBITDA should gradually improve from pro
forma levels. We assume that management and Wind Point Partners,
the company's private equity owner, will be supportive of credit
quality, and thus have not factored into our analysis any
meaningful debt-funded distributions. We expect that the company
will continue to look to supplement organic growth with growth
through acquisitions aimed at extending its scope and reach. As a
result of the combined company's enhanced competitive position and
reasonable level of debt leverage at close, we believe there is
some flexibility at the current rating level," S&P noted.
S&P could raise the ratings by one notch in the next 12 months if
the company is able to successfully integrate the acquisition and
achieve the targeted synergies. Based on S&P's scenario
forecasts, it could consider an upgrade if organic revenues grow
by more than 5%, combined with at least a 150 basis point
improvement in EBITDA margins beyond S&P's expectations. In this
scenario, S&P would expect that debt to EBITDA would drop to about
4x. To consider higher ratings, S&P would also need further
insight into the company's financial policies, and gain comfort
that adjusted debt leverage would remain below 5x even after
factoring in the potential for additional debt-funded acquisitions
or dividends.
S&P could lower the ratings if operating performance was
significantly weaker than its expectations, which could result
from shifts in consumer preferences, increased legislative
pressures, or unexpected difficulties during the integration
process. Based on S&P's scenario forecasts, it could consider a
modestly lower rating if volumes dropped by 5% combined with a
reduction in EBITDA margins by 150 basis points or more. In such
a scenario S&P would expect debt to EBITDA weakening to above 6x.
S&P could also consider a downgrade if the company pursued a large
debt-funded acquisition or dividend recap, or if free cash flow
weakened and caused S&P to revise its liquidity assessment to
"less than adequate".
HOSTESS BRANDS: Aug. 7 Bid Deadline Set for Headquarters Building
-----------------------------------------------------------------
While pulling off "The Sweetest Comeback in the History of Ever"
(TM), Hostess Brands has been using a ñ40,450 square foot,
two-story building located in Kansas City, Missouri, as its
corporate headquarters until it locates a permanent headquarters
building. The property is now featured on LFC's auction website,
Freedom Realty Exchange (FRE.com), and presents an incredible
opportunity for an owner/user or investor to purchase with a
guaranteed one year leaseback.
The property has been on the market for more than a year and with
no certainty of a sale, it became evident to the company that an
online auction could attract attention from a larger group of
potential buyers and set a timeframe for the sale.
In addition to the low starting bid, the purchase of the building
includes a one-year leaseback, giving Hostess Brands the time they
require to locate a new headquarters building in the Kansas City
metro area and the new owner a guaranteed income until they move
their employees into the building or find new tenants.
"When traditional methods stop delivering results, we find many
property owners turning to online auctions to re-energize buyer
interest from a broader market," explains Kelly Lovegrove,
director of marketing for the auction company. "Hostess Brands
found themselves in this situation and decided the online auction
could produce the best outcome."
PROPERTY DETAILS
ñ40,450 square feet including an approx. 8,650 square foot
basement, a former call center
High traffic, corner location
Conveniently located near mass transit
Sale/Leaseback? guaranteed one year leaseback with sale
AUCTION DETAILS
Minimum bid: $999,000
Bid deadline August 7, 2014
Auction website for property documents www.FRE.com
Other Hostess Brands properties available in the auction are
former Bakery Outlets in Hampton, Virginia; Tallmadge, Ohio and
Indianapolis, Indiana.
As with all auctions on the Freedom Realty Exchange website,
interested buyers have online access to view and download due
diligence materials, and the convenience of submitting bids
through a secure online process.
About Hostess Brands
Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known
for iconic brands such as Butternut, Ding Dongs, Dolly Madison,
Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride,
Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution
centers and 570 outlets in 49 states.
Hostess filed for Chapter 11 bankruptcy protection early morning
on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through
12-22056) in White Plains, New York. Hostess Brands disclosed
assets of $982 million and liabilities of $1.43 billion as of the
Chapter 11 filing.
The bankruptcy filing was made two years after predecessors
Interstate Bakeries Corp. and its affiliates emerged from
bankruptcy (Bankr. W.D. Mo. Case No. 04-45814).
In the new Chapter 11 case, Hostess has hired Jones Day as
bankruptcy counsel; Stinson Morrison Hecker LLP as general
corporate counsel and conflicts counsel; Perella Weinberg Partners
LP as investment bankers, FTI Consulting, Inc. to provide an
interim treasurer and additional personnel for the Debtors, and
Kurtzman Carson Consultants LLC as administrative agent.
Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry
Wilson, the head of turnaround and restructuring firm MAEVA
Advisors, are representing the Teamsters union.
Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain
Millers International Union and Bakery & Confectionery Union &
Industry International Pension Fund are Jeffrey R. Freund, Esq.,
at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David
A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright &
Jaworski L.L.P.
The official committee of unsecured creditors selected New York
law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom
Mayer and Ken Eckstein head the legal team for the committee.
Hostess Brands in mid-November 2012 opted to pursue the orderly
wind down of its business and sale of its assets after the Bakery,
Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a
nationwide strike. The Debtor failed to reach an agreement with
BCTGM on contract changes.
Hostess Brands sold its businesses and most of the plants to five
different buyers for an aggregate of $860 million. Hostess still
has some plants, depots and other facilities the buyers didn't
acquire.
The bankruptcy estate has changed its name to Old HB Inc.
HOTEL OUTSOURCE: Reports $385K Net Loss in First Quarter
--------------------------------------------------------
Hotel Outsource Management International, Inc., filed its
quarterly report on Form 10-Q, disclosing a net loss of $385,000
on $642,000 of revenues for the three months ended March 31, 2014,
compared with a net loss of $412,000 on $982,000 of revenues for
the same period in 2013.
The Company's balance sheet at March 31, 2014, showed $4.67
million in total assets, $4.48 million in total liabilities, and
stockholders' equity of $194,000.
The Company has suffered recurring losses from operations and has
a net working capital deficiency that raises substantial doubt
about its ability to continue as going concern.
A copy of the Form 10-Q is available:
http://is.gd/GVIBwD
New York-based Hotel Outsource Management International, Inc., is
a multi-national service provider in the hospitality industry,
supplying a range of services in relation to computerized minibars
that are primarily intended for in-room refreshments.
INRETAIL REAL: Fitch Assigns 'BB' IDR & Rates Unsec. Notes 'BB'
---------------------------------------------------------------
Fitch Ratings has assigned the following ratings to InRetail Real
Estate Corp.:
-- Foreign currency Issuer Default Rating (IDR) 'BB';
-- Local currency IDR 'BB'.
-- Proposed senior unsecured notes 'BB' (to be issued by
InRetail Shopping Malls).
The Rating Outlook is Stable.
The proposed transaction will be issued by InRetail Shopping
Malls, a fully owned subsidiary of InRetail Real Estate. The
notes will be fully and unconditionally guaranteed by InRetail
Real Estate Corp.; and the following subsidiaries of the issuer:
Interproperties Holding, Interproperties Holding II, Real Plaza
S.R.L., and InRetail Properties Management S.R.L.
The target amount of the proposed issuance is USD300 million; the
final amount of the issuance will depend on market conditions.
Proceeds from the seven year proposed issuance will be used
primarily to fund the company's capital expenditures plan,
refinance existing debt, and strengthen the company's liquidity.
The ratings reflect the company's solid business position, stable
and predictable cash flow generation, expected levels of leverage,
liquidity, and unencumbered assets post-proposed issuance, strong
credit linkage with its parent company Intercorp Retail Inc.
(Intercorp Retail), positive industry momentum riding on Peru's
favorable economic environment, and the low working capital
requirements of the industry, with tenants responsible for most
property maintenance expenses.
KEY RATING DRIVERS:
Solid Business Position:
InRetail Real Estate is the largest company in the shopping mall
sector in Peru based on both gross leasable area (GLA) and the
number of shopping malls. Under its Real Plaza brand, the company
operates 16 shopping malls with 496 thousand square meters (m2) of
gross leasable area (GLA) that it owns or leases on a long term
basis and three additional shopping malls with 58 thousand m2 of
GLA that are owned by related parties. The company maintains a
market share, measured as its participation in Peru's total GLA,
estimated around 20% by Dec. 31, 2013. Its market position in
Peru's shopping mall industry is viewed as solid in the medium
term.
Favorable Business Environment:
The company is expected to continue to benefit from solid
fundamentals for Peru's shopping mall sector as a result of a
positive macroeconomic environment coupled with a limited supply
of leasable shopping areas. During the last five years Peru's
favorable economic environment has led to increases in disposable
income. The Peruvian mall industry's low penetration rate support
continued growth. The sector is characterized by limited supply
of leasable area, with only 63 shopping centers in the country and
low penetration rates, with a ratio of only 66 thousand GLA per
1,000 persons; and only 13% of Peru's retail sales being through
shopping centers.
Lease Characteristics Support Revenue Stream:
InRetail Real Estate's margins are viewed as stable. They are
supported by a lease structure that consists of fixed rent
payments and tenant reimbursements, which represent 84% and 2%,
respectively, of the company's total rental income. InRetail Real
Estate's net revenues and adjusted EBITDA during latest 12 months
(LTM) March 2014 were S/.164 million and S/.125 million, resulting
in an adjusted EBITDA margin of 76%. The company's adjusted
EBITDA is expected to reach annual growth rates of 52% and 27%
during 2014 and 2015, respectively driven by the increase in GLA.
Adjusted EBITDA margin should remain stable around 76%.
Operational Performance in Line with Industry Standards:
InRetail Real Estate has maintained good occupancy levels and low
default rates average of 95% and 1%, respectively, during the
2012-2014 period. Its lease portfolio has adequate lease
expiration dates, with approximately 8% and 10% of the company's
lease portfolio -- measured as a percentage of the company's total
fixed income -- having expiration dates during 2014 and 2015,
respectively. In addition, the company's lease duration profile
for its property portfolio has an average of five years, which is
in line with market standards.
Limited Diversification:
The ratings incorporate InRetail Real Estate's asset and tenant
concentration risk. The company's net revenues structure presents
some asset concentration with four malls representing
approximately 45% of its expected net revenues during 2014. In
addition, the company's tenant composition is concentrated as its
10 most important tenants represent approximately 50% of the
company's total annual rent revenue. This concentration is
partially counterbalanced by the credit quality of these tenants.
The company's assets and tenant concentration risk is not expected
to materially change in the short to medium term.
Capex Plan to Increase GLA 25% by December 2016:
The company's management strategy is to grow organically by taking
advantage of shopping mall development opportunities identified
throughout Peru, expanding its reach across socioeconomic segments
and geographic markets.
InRetail Real Estate has a good track record in executing new
developments and it maintains a significant capital expenditure
(capex) plan, which will be funded with the company's cash flow
generation (adjusted EBITDA) and incremental debt through the
proposed transaction. In the past three years, equity injections
for a total amount of approximately S/.1.2 billion (USD418
million) were an important component to fund the execution of the
company's capex. During the last 18 months ended in May 2014, the
company added approximately 227 thousand m2 to its GLA, increasing
total GLA in approximately 78% during the period and ending May
2014 with a total GLA of 497 thousand m2. The company's capex
plan for 2014-2015 period considers levels of approximately S/.600
million (USD214 million), increasing its total GLA in
approximately 250 thousand m2 and reaching total GLA of 650
thousand m2 by the end of 2016.
Moderate Leverage:
Fitch views the company's proforma net leverage in line with
industry standards. As of March 31, 2014, the company had S/.647
million (USD230 million) of total debt, which was composed of the
USD185 million secured bonds - issued through Interproperties
Holding - and the remaining balance mostly in banking loans and
financial leases. InRetail Real Estate's rating incorporates the
expectation that the company's net leverage will remain in the 4x
to 4.5x range during the 2014-2015 period. At the end of March
2014, the company's net leverage, measured by the total net debt-
to-EBITDA ratio, was 4.9x, reflecting its LTM March 2014 EBITDA of
S/.125 million (USD45 million) and total net debt of S/.606million
(USD216 million). On a pro forma basis - considering the proposed
unsecured USD300 million transaction - the company's net debt is
expected to be around S/.770 million (USD275 million) by the end
of 2014.
Good Liquidity Post Issuance:
InRetail Real Estate Corp.'s liquidity post issuance is viewed as
adequate as a result of expected cash position, manageable debt
payment schedule, and levels of unencumbered assets. The ratings
incorporate the view that the company will end 2014 with a cash
position of around S/.250 million (USD90 million), InRetail Real
Estate will face - post proposed issuance - annual debt payments
in the S/.18 million to S/.20 million range during the 2014-2016
period, which is viewed as manageable.
In addition, the company's assets related to the shopping malls -
including Salaverry shopping mall - have an estimated market value
of approximately USD725 million by June 2014.
On a consolidated and pro forma basis, considering new assets
being added with proceeds from proposed transaction, the company's
total asset value and total secured and unsecured debt, the loan
to value is estimated at around 45%. The company is expected to
maintain a good level of unencumbered assets with an estimated
market value of approximately USD585 million, covering 2x its
unsecured debt level. This level of unencumbered assets provides
financial flexibility as it could be used to access financing in a
stress scenario.
Retail Holding's Adjusted Leverage Constrains Ratings:
Fitch views the credit linkage between InRetail Real Estate and
its parent company Intercorp Retail - rated 'BB', Outlook Stable -
as strong reflecting the operational and strategic ties between
these entities. InRetail Real Estate's ratings are constrained by
Intercorp Retail's high adjusted net leverage driven by
significant levels of capex and inorganic growth in recent years.
Intercorp Retail's consolidated financial net leverage ratio,
measured by the total net adjusted debt/EBITDAR, was 5.7x during
the LTM March 31, 2014. Intercorp Retail's ratings include the
expectation of a business deleverage taking place during 2014-
2015. Intercorp Retail's business position in the Peruvian retail
industry is viewed as solid driven by a sound business strategy of
developing and integrating several retail formats with its real
estate operations.
RATING SENSITIVITIES:
Negative Rating Actions:
Fitch would consider a negative rating action if the company's
financial profile deteriorates due to some combination of the
following factors: adverse macroeconomic trends leading to weaker
credit metrics; significant dividend distributions; and higher
than expected vacancy rates or deteriorating lease conditions. A
rating downgrade could be also triggered by deterioration in the
group's retail operations resulting in Intercorp Retail Inc.'s
inability to reduce its net adjusted leverage in line with
expectations incorporated in the ratings.
Positive Rating Actions:
Fitch would consider a positive rating action as a result of the
combination of the following factors: Improvement in InRetail Real
Estate's net leverage, liquidity and unencumbered assets at levels
above those incorporated in the ratings coupled with Intercorp
Retail reaching a significant business deleverage in the next 12
to 18 months ended in December 2015.
INTELLIGRATED INC: Moody's Rates $68MM 1st Lien Debt Add-on 'B2'
----------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Intelligrated
Inc's. $68 million first lien senior secured add-on term loan and
downgraded the existing first lien senior secured facility
consisting of a $35 million revolver and a $252 million term loan
to B2 from B1. Proceeds from the add-on along with $25 million
cash on hand will be used to repay Intelligrated's second lien
term loan. The rating downgrade of the senior secured credit
facilities to B2 from B1 reflects the loss of subordination of the
$90 million second lien term loan that is being repaid in the
transaction. The Corporate Family Rating (CFR) was affirmed at B2
while the Probability of Default was downgraded to B3-PD from B2-
PD. The company's second lien term loan, rated Caa1, will be
withdrawn upon pay down and completion of the transaction. The
company's ratings outlook remains stable.
Ratings Rationale
Intelligrated's B2 Corporate Family Rating recognizes the
company's high degree of financial leverage (Moody's pro forma
adjusted debt to EBITDA as of June 2014 is approximately 5.0
times), the firm's small size on an absolute and relative basis,
regional and customer concentration as well as the cyclical nature
of many of its customers capital expenditures. These
considerations are tempered by Intelligrated's good competitive
position within the automated logistics and material handling
industry, expectations of an improving backlog and bookings
pipeline driven by ongoing E-commerce growth along with
expectations of sustainable free cash flow.
Issuer: Intelligrated, Inc.
Assignments:
$68 million Senior Secured First Lien Term Loan add-on rated
B2, LGD3, 36%
Affirmations:
Corporate Family Rating, Affirmed B2
Outlook, Stable
Downgrades:
Probability of Default Rating, downgraded to B3-PD from B2-PD
$35 million Senior Secured Revolver, downgraded to B2 from B1
(LGD3, 36%)
$252 million Senior Secured First Lien Term Loan, downgraded to
B2 from B1 (LGD3, 36%)
The first lien term loan was downgraded due to the increase of a
pari passu claim and the loss of subordinated capital resulting
from the pay down of the second lien term loan. The $68 million
first lien term loan add-on increases the size of the company's
first lien term loan to $320 million. The debt is being issued by
Intelligrated, Inc., and is guaranteed by Ibiza Holdings inc.
(Holdings). The add-on also benefits from certain material wholly-
owned domestic subsidiary guarantees. The Caa1 rating on the $90
million second lien term loan will be withdrawn upon the close of
the transaction and the debt's retirement.
The stable outlook reflects our expectation for mid-to-high single
digit organic revenue growth over the coming quarters along with
gradually improving profitability coupled with expectations of
improvements in cash flow generation driven by higher backlog.
The rating and/or outlook could come under negative pressure if
new orders or Intelligrated's market share or margins appreciably
decline, leading to lower profitability and slimmer coverage
metrics. Debt/EBITDA trending towards 5.5 times, EBITA/Interest
less than 2 times or several quarters of negative free cash flow
could adversely impact the ratings.
The ratings and/or outlook could experience upward pressure should
the company's scale increase, its margins appreciably strengthen,
and resultant cash flows are used to de-lever the balance sheet.
Lower customer concentration in the business model would also be
viewed favorably. Quantitatively this could include EBITA margins
consistently above 8% through the cycle, debt/EBITDA under 4
times, EBITA/interest at 2 times or higher, and FCF/debt sustained
above 7%.
The principal methodology used in this rating was the Global
Manufacturing Industry published in December 2010. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Intelligrated, Inc., headquartered in Mason, OH, manufactures,
services and installs high speed automated material handling
equipment and related sub-systems in customer distribution centers
to address supply chain needs. Its customers primarily include
retailers and producers of consumer goods located primarily in
North America. Intelligrated was acquired by funds affiliated with
Permira Advisors LLC in July 2012. Annual revenues for 2013 were
approximately $600 million.
INT'L STEM CELL: Incurs $1.43-Mil. Net Loss in March 31 Quarter
---------------------------------------------------------------
International Stem Cell Corporation filed its quarterly report on
Form 10-Q, disclosing a net loss of $1.43 million on $1.65 million
of total revenue for the three months ended March 31, 2014,
compared with a net loss of $1.71 million on $1.28 million of
total revenue for the same period in 2013.
The Company's balance sheet at March 31, 2014, showed $6.65
million in total assets, $6.05 million in total current
liabilities, convertible redeemable preferred stock of $4.94
million and a stockholders' deficit of $4.34 million.
The Company needs to raise additional working capital. The timing
and degree of any future capital requirements will depend on many
factors. Currently, the Company's burn rate is approximately
$677,000 per month, excluding capital expenditures and patent
costs averaging $52,000 per month. There can be no assurance that
the Company will be successful in maintaining its normal operating
cash flow, and that such cash flows will be sufficient to sustain
the Company's operations through 2014. These factors raise
substantial doubt about the Company's ability to continue as a
going concern, according to the regulatory filing.
A copy of the Form 10-Q is available:
http://is.gd/sAxDHB
International Stem Cell Corp. operates as a biotechnology company,
which develops a new stem cell technology called parthenogenesis
that addresses the problem of immune-rejection. The company
operates through two business subsidiaries: Lifeline Skin Care and
Lifeline Cell Technology. Stem Cell was founded by William B.
Adams, Kenneth C. Aldrich and Gregory S. Keller on August 17, 2001
and is headquartered in Carlsbad, CA.
JORDAN WESLEY: Case Summary & 5 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Jordan Wesley, LLC
9153 E Bell RD
Scottsdale, AZ 85260
Case No.: 14-09741
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Hon. Daniel P. Collins
Debtor's Counsel: Carlos M. Arboleda, Esq.
ARBOLEDA BRECHNER
4545 E. Shea Blvd., #120
Phoenix, AZ 85028
Tel: 602-482-0123
Fax: 602-482-4068
Email: arboledac@abfirm.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Thomas Pelliteri, president.
A list of the Debtor's five largest unsecured creditors is
available for free at http://bankrupt.com/misc/azb14-09741.pdf
LHP HOSPITAL: S&P Lowers CCR to 'B-' & Removes From Watch Neg.
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on LHP Hospital Group Inc. to 'B-' from 'B' and removed it
from CreditWatch negative. The rating outlook is negative.
At the same time, S&P lowered the issue-level rating on the
company's senior secured debt to 'B-' from 'B', in conjunction
with the lowered corporate credit rating. S&P revised the
recovery rating on this debt to '4' from '3', reflecting its
expectation for average (30% to 50%) recovery for lenders in the
event of default.
"Several factors are affecting LHP more than we originally
anticipated including weak patient volume trends, a difficult
reimbursement environment, and regulatory changes," said credit
analyst David Peknay. "The company's small portfolio of only six
hospitals is undiversified, with profitability that we believe is
concentrated in only a few of its hospitals. LHP's hospitals
operate in difficult, competitive markets that include payor mix
challenges as well as local economic risk. Along with the
industry, LHP has been hurt by reimbursement and regulatory
changes that include the two-midnight rule, which has resulted in
a significant shift to lower paying observation stays. In
addition, the growth in high deductible health plans has, for some
facilities, resulted in higher bad debt."
S&P's negative rating outlook on LHP reflects its view that
despite some signs of improvement in early 2014, and the use of
proceeds from a sale/leaseback transaction to replenish revolver
capacity, further operating losses and cash flow deficits are
risks to the company meeting its debt covenant requirement in the
fourth quarter.
Downside scenario
S&P could lower its rating if the company cannot improve operating
performance, cash flow remains negative, and S&P believes it may
not meet its debt covenant requirements. S&P believes factors
that might lead to such an outcome could include underachievement
on its cost reduction plan, continued weak patient volume, and
failure to mitigate the large losses being incurred in some
facilities. S&P would also view ongoing operating weakness as an
indication that the company's capital structure, including
significant amount of preferred stock and lease obligations, is
unsustainable.
Upside scenario
In S&P's view, the likely scenario for a stable outlook centers on
the company improving its operating performance sufficiently to
generate free cash flow. S&P estimates it would take a gross
margin improvement of at least 400 bps to achieve this result.
S&P expects this may require changes to its hospital portfolio,
including divestitures of its unsuccessful operations.
LV HARMON: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor affiliates filing separate Chapter 11 petitions:
Debtor Case No.
------ --------
LV Harmon LLC 14-14360
c/o Reinhard LLP
44 Wall Street, 10th Floor
New York, NY 10005
WG Las Vegas LLC 14-14361
LVH 2 TIC LLC 14-14362
LVH 3 TIC LLC 14-14363
WAICCS Las Vegas 3 LLC 14-14364
c/o Reinhardt LLP
44 Wall Street, 10th Flr.
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Hon. August B. Landis
Debtors' Counsel: Gerald M Gordon, Esq.
GORDON SILVER
3960 Howard Hughes Pky 9th Flr
Las Vegas, NV 89169
Tel: (702) 796-5555
Fax: (702) 369-2666
Email: bankruptcynotices@gordonsilver.com
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $500 million to $1 billion
The petitions were signed by Massimiliano Ferruzzi, authorized
signatory.
The Debtors did not file a list of their largest unsecured
creditors when they filed the petitions.
M.A.R. REALTY: Plan Outline OK'd; Confirmation Hearing on July 9
----------------------------------------------------------------
The Hon. Mildred Caban Flores of the U.S. Bankruptcy Court for the
District of Puerto Rico has approved the disclosure statement
explaining M.A.R. Realty Inc.'s proposed Chapter 11 plan.
The hearing for the consideration of confirmation of the
Amended Chapter 11 Plan of Reorganization will be held on July 9,
2014, at 9:00 a.m.
As reported by the Troubled Company Reporter on May 2, 2014, the
Plan essentially contemplates the full payment to the secured
creditor, zero dividend for unsecured creditors and for current
management to remain post-bankruptcy. The secured claim of
creditor Banco Popular is unimpaired. The Amended Plan provides
that on agreement with Banco Popular on the Effective Date, the
Debtor will commence monthly payment of $5,000 as adequate
protection.
Copies of the Amended Plan and the court-approved Disclosure
Statement are available at:
http://bankrupt.com/misc/MARRealty_AmdPlan.PDF
http://bankrupt.com/misc/MARRealty_DSMar26.PDF
About M.A.R. Realty
M.A.R. Realty Corp. filed a Chapter 11 petition (Bankr. D.P.R.
Case No. 13-09752) on Nov. 25, 2013. Edwin Ramos signed the
petition as president. The Debtor disclosed $11.16 million in
total assets and $10.14 million in total liabilities. Isabel M.
Fullana, Esq., at Garcia Arregui & Fullana PSC, serves as the
Debtor's counsel. Hon. Mildred Caban Flores presides over the
case.
MACKEYSER HOLDINGS: Meeting to Form Creditors' Panel on July 8
--------------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on July 8, 2014, at 10:00 a.m. in
the bankruptcy case of MacKeyser Holdings, LLC, et al. The
meeting will be held at:
J. Caleb Boggs Federal Building
844 King St., Room 5209
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents
About MacKeyser Holdings, LLC
MacKeyser Holdings, LLC and its operating affiliates -- American
Optical Services, LLC, and Exela Hearing Services, LLC -- manage
integrated eye care and hearing systems providers with over 80
optical retail, optometry and ophthalmology locations in 14
states. Within certain of the Company's locations, dedicated
audiology and dispensing staff conduct diagnostics, fitting and
dispensing of hearing systems.
MacKeyser Holdings, LLC, American Optical Services, Inc. and their
affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
Nos. 14-11528 to 14-11550) on June 20, 2014. David R. Hurst,
Esq., and Marion M. Quirk, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, PA. The Debtors' financial advisor is GlassRatner
Advisory & Capital Group. The investment banker is Hammond Hanlon
Camp LLC. The noticing and claims management agent is American
Legal Claim Services, LLC.
In its petition, MacKeyser Holdings estimated $50 million to $100
million in both assets and liabilities.
The petitions were signed by Thomas J. Allison, authorized
officer.
MAGNUM HUNTER: Moody's Affirms B3 CFR & Revises Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Service changed Magnum Hunter Resources
Corporation's (MHR) rating outlook to stable from negative and
upgraded the company's Speculative Grade Liquidity Rating to
SGL-3 from SGL-4. At the same time, Moody's affirmed MHR's B3
Corporate Family Rating (CFR), B3-PD Probability of Default Rating
(PDR) and Caa1 senior unsecured note rating.
"The outlook change reflects improved liquidity and production
visibility through 2015," commented Sajjad Alam, Moody's Analyst.
"Although recent debt repayments with equity and asset sales
proceeds have improved MHR's leverage metrics, ongoing capital
discipline, focus on production and non-core asset divestitures
will be keys to maintaining a stable credit profile."
Debt List
Issuer: Magnum Hunter Resources Corporation
Outlook Actions:
Changed To Stable From Negative
Upgrades:
Speculative Grade Liquidity Rating, Upgraded to SGL-3 from SGL-4
Affirmations:
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
US$600M 9.75% Senior Unsecured Regular Bond/Debenture, Affirmed
Caa1 (LGD4)
Ratings Rationale
Following the sale of its Tableland assets in Canada and an equity
offering in second quarter 2014, MHR appears to have adequate
liquidity through mid-2015 which is captured in the upgraded SGL-3
rating. Pro forma for the aforementioned transactions, the company
had $24 million of cash and cash equivalents as of May 6, 2014 and
$202 million of availability under its $272.5 million borrowing
base revolving credit facility. However, despite having
substantial availability, revolver borrowings will increase
quickly over the next several quarters because of significant
anticipated negative free cash flow generation. Additionally,
there is limited covenant headroom under the credit facility
leverage and coverage financial covenants, therefore, ongoing
access to the revolver will depend on MHR's ability to grow
production and EBITDA at a faster pace than the growth in debt.
The company is looking to divest additional non-core assets in
Kentucky, North Dakota and West Virginia in the second half of
2014 to raise additional liquidity. Moody's expect limited
borrowing base growth this year as organic reserves additions are
largely offset by asset sales. Moody's note that MHR's midstream
assets (Eureka Hunter) are not pledged to MHR's bank lenders and
could provide alternate liquidity.
MHR's B3 Corporate Family Rating (CFR) reflects its small scale
E&P operations; high leverage relative to current production and
reserves levels despite some recent debt paydowns; weak capital
productivity and cash margins, and the execution and financing
risks surrounding the company's planned growth through 2015. The
B3 CFR is supported by MHR's significant acreage position in the
Marcellus and Utica Shales, good organic growth prospects and the
potential value in the company's midstream assets.
MHR's $600 million senior unsecured notes are rated Caa1, one
notch below the B3 CFR, given the priority claim of the first-lien
secured revolving borrowing base credit facility in the capital
structure.
The stable outlook assumes that MHR will maintain adequate
liquidity and ramp up production through 2015.
A clear upward trend in production and good liquidity will be pre-
requisites for an upgrade. An upgrade could be considered if
production can be sustained above 25,000 boe per day and the
retained cash flow to debt ratio can be maintained above 30%.
The CFR could be downgraded if MHR acquires significant additional
non-producing properties using debt, or liquidity challenges re-
emerge. A downgrade could also occur if the anticipated production
and reserves growth is not achieved in line with the capital
spending and rising debt levels.
The principal methodology used in this rating was the Global
Independent Exploration and Production Industry published in
December 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.
Magnum Hunter Resources Corporation (MHR) is a Houston, Texas
based publicly traded oil and gas exploration and production (E&P)
company with principal assets in the states of West Virginia,
Ohio, North Dakota, and Kentucky.
MEDIA GENERAL: Moody's Says WHTM TV Deal No Impact on 'B1' CFR
--------------------------------------------------------------
Moody's Investors Service relates that Media General, Inc. agreed
with Sinclair Broadcast Group, Inc. to purchase WHTM TV, an ABC
affiliate in Harrisburg, PA, currently owned by Allbritton
Communications Company, for $83.4 million in cash. There is no
immediate impact to Media General's ratings nor the stable outlook
as Moody's expects overall financial metrics and operating
performance to remain within the B1 Corporate Family Rating. The
transaction increases the 2-year average debt-to-EBITDA ratio
modestly, and is expected to be in the mid 5x range pro forma for
announced transactions (including Moody's standard adjustments).
The acquisition is subject to regulatory clearance, customary
closing conditions, and completion of the Sinclair-Allbritton
acquisition.
Media General, headquartered in Richmond, VA, is a television
broadcaster and is expected to own, operate or service 75 network
affiliated stations and their digital property across 47 markets
covering roughly 24% of U.S. television households, post-closing
of the announced merger with LIN, the acquisition of WHTM, and
certain divestitures. The company is expected to have 34 stations
in the largest 75 media markets and network affiliations will
include 23 CBS stations, 16 NBC, 13 ABC, 10 FOX, 7 CW, and 6 MNT.
Media General is publicly traded and, as part of the LIN merger,
Media General plans to form a new holding company through which
existing Media General shareholders will own 64% of the new
holding company with LIN shareholders owning the remaining 36%.
Current owners of Media General include, Standard General,
Oppenheimer, Gabelli, and Highland Capital, with the remainder
being widely held. Average 2012 and 2013 revenue pro forma for
announced transactions is $1.3 billion.
METEX MFG: Bankr. Court Junks Ill. Tax Claim v. Predecessor
-----------------------------------------------------------
Judge Cecelia G. Morris of the U.S. Bankruptcy Court for the
Southern District of New York issued a memorandum decision dated
June 13, 2014, sustaining the objection of Metex Mfg. Corporation
to the Illinois Department of Revenue's administrative claim for
unpaid taxes, after finding that the tax claim was discharged in
1998 by confirmation of the plan of reorganization in the prior
bankruptcy case of Kentile Floors, Inc., Metex's predecessor.
Even to the extent the claims were not discharged, they are barred
by the applicable statute of limitations, Judge Morris said.
The case is In re: Metex Mfg. Corporation, Chapter 11 Debtor,
CASE NO. 12-14554 (CGM)(Bankr. S.D.N.Y.). A full-text copy of
Judge Morris' Decision is available at http://is.gd/WK9tkqfrom
Leagle.com.
Paul E. Breene, Esq. -- pbreene@reedsmith.com -- and Paul M.
Singer, Esq. -- psinger@reedsmith.com -- at REED SMITH LLP,
Attorneys for the Debtor, New York, NY, and Pittsburgh, PA.
OFFICE OF THE ILLINOIS ATTORNEY GENERAL James D. Newbold,
Assistant Attorney General, Counsel for the Illinois Department of
Revenue, Chicago, IL.
About Metex
Great Neck, New York-based Metex Mfg. Corporation, formerly known
as Kentile Floors, Inc., started business in the late 1800's as a
manufacturer of cork tile, and thereafter progressed to making
composite tile for commercial and residential use.
Metex filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y.
Case No. 12-14554) on Nov. 9, 2012. The petition was signed by
Anthony J. Miceli, president. The Debtor estimated its assets and
debts at $100 million to $500 million. Judge Burton R. Lifland
presides over the case.
Paul M. Singer, Esq., and Gregory L. Taddonio, Esq., at Reed Smith
LLP, in Pittsburgh, Pa.; and Paul E. Breene, Esq., and Michael J.
Venditto, Esq., at Reed Smith LLP, in New York, N.Y., represent
the Debtor as counsel.
In connection with the case, the U.S. Trustee appointed a
committee of five individual asbestos plaintiffs asserting claims
against Kentile. The plaintiffs are represented by five law
firms: Belluck & Fox; Weitz & Luxenberg, P.C.; Early Lucarelli
Sweeney & Strauss; Cooney & Conway; and Gori Julian & Associates,
PC. The Asbestos Claimants Committee engaged Caplin & Drysdale,
Chartered, as its bankruptcy counsel, Gilbert LLP as its special
insurance counsel, Legal Analysis Systems, Inc., as its
consultant, and Charter Oak Financial Consultants, LLC, as its
financial advisor.
On Jan. 16, 2013, the Bankruptcy Court appointed Lawrence
Fitzpatrick as the Future Claimants' Representative. Mr.
Fitzpatrick engaged Young Conaway Stargatt & Taylor, LLP as his
counsel, and Analysis Research & Planning as his econometrician.
MOMENTIVE PERFORMANCE: Jefferies Approved as Investment Banker
--------------------------------------------------------------
The Bankruptcy Court authorized the Official Committee of
Unsecured Creditors in the Chapter 11 cases of MPM Silicones, LLC,
et al., to retain Jefferies LLC as investment banker nunc pro tunc
to April 22, 2014.
The Court said that the terms of the firm's compensation are
reasonable for purposes of Section 328(a) of the Bankruptcy Code.
Objections were filed to the Jefferies engagement by the Debtors.
The Ad Hoc Committee of Second Lien Noteholders and Apollo Global
Management, LLC and certain of its affiliated funds filed joinders
to the Debtors' objection. They object to the $2.5 million fee
payable to the firm if the court approves a plan that's acceptable
to a majority of the committee, including at least one
subordinated noteholder.
The Committee, in its reply to the objections, said that the
Jefferies engagement letter provides for Jefferies to receive a
monthly fee of $150,000. Additionally, in the event that a
chapter 11 plan is confirmed and consummated in the cases, the
engagement letter provides for Jefferies to receive a transaction
fee of $2,500,000.
The Committee said the Debtors supply no legitimate reason to
interfere with the Committee's judgment with respect to the terms
of Jefferies' compensation. The terms are reasonable and
appropriate under the circumstances, and must be approved.
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.
The U.S. Trustee for Region 2 appointed seven members to serve on
the Official Committee of Unsecured Creditors of the Debtors'
cases. Klee, Tuchin, Bogdanoff & Stern LLP serves as its
counsel. FTI Consulting, Inc., serves as its financial advisor.
Rust Consulting Omni Bankruptcy serves as its information agent.
MUSCLEPHARM CORP: Strengthens Retail Presence with GNC
------------------------------------------------------
MusclePharm Corporation announced an expanded relationship with
GNC, a specialty retailer of health and wellness products, to
carry all of MusclePharm's brands--MusclePharm(R) Hybrid and Core
Series, Arnold Schwarzenegger SeriesTM and FitMiss(R)--on a
dedicated wall in all of GNC's U.S. corporate stores. The new
initiative is expected to begin during MusclePharm's 2014 third
quarter.
"I am excited about the expanded commitment and partnership with
GNC, nearly doubling the number of stores carrying our brands to
more than 4,000, and extending our relationship to include all of
our brands with the addition of FitMiss," said Brad Pyatt, chief
executive officer of MusclePharm. "Our increased in-store and
online presence, which is set to begin in third quarter, will be
further supported through a unique and aggressive sales and
marketing program."
"MusclePharm, recognized by GNC in 2012 with our exclusive Rising
Star vendor award, utilizes innovative social media and digital
marketing and a robust stable of notable athletes, fitness
enthusiasts and brand ambassadors to reach and educate its
customers and targets," said Joe Fortunato, chairman, president
and CEO of GNC. "We are looking forward to our partnership with
MusclePharm to complement each other's strengths, drive traffic
and reach a broader global market."
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation
(OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life-
style company that develops and manufactures a full line of
National Science Foundation approved nutritional supplements that
are 100 percent free of banned substances. MusclePharm is sold in
over 120 countries and available in over 5,000 U.S. retail
outlets, including GNC and Vitamin Shoppe. MusclePharm products
are also sold in over 100 online stores, including
bodybuilding.com, Amazon.com and Vitacost.com.
MusclePharm reported a net loss after taxes of $17.71 million in
2013, as compared with a net loss after taxes of $18.95 million in
2012. The Company's balance sheet at March 31, 2014, showed
$65.61 million in total assets, $30.81 million in total
liabilities and $34.79 million in total stockholders' equity.
NAUTILUS HOLDINGS: Meeting to Form Creditors' Panel on July 1
-------------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on July 1, 2014, at 10:00 a.m. in
the bankruptcy case of Nautilus Holdings Limited, et al. The
meeting will be held at:
80 Broad Street
4th Floor
New York, NY 10004
212-510-0500
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
NAVISTAR INTERNATIONAL: Adopts Tax Asset Protection Plan
--------------------------------------------------------
Navistar International Corporation said that its Board of
Directors approved an amendment to the Company's Stockholder
Rights Plan in order to protect the Company's valuable tax assets
by reducing the likelihood of an unintended "ownership change"
under IRS guidelines. The amendment to Stockholder Right Plan has
the effect of turning the existing Stockholder Rights Plan or
"poison pill" into a Tax Asset Protection Plan.
The Company's existing Stockholder Rights Plan was to expire on
July 1, 2014. The new Tax Asset Protection Plan will expire on
Sept. 1, 2014.
"Since the inception of the Stockholder Rights Plan, the Navistar
Board has regularly reviewed the plan to determine its alignment
with the best interests of the company," said James Keyes,
Navistar Board of Directors non-executive chairman.
As of Oct. 31, 2013, Navistar had a federal net operating loss
carryforward of approximately $1.8 billion. Under Section 382 of
the Internal Revenue Code, the use of the Company's net operating
loss and other carryforwards would be limited in the event of an
"ownership change," which is defined as a cumulative change of
more than 50 percent during any three year period by stockholders
owning 5 percent or more of the Company's stock.
The Tax Asset Protection Plan is designed to discourage any person
or group from becoming a 5 percent stockholder, thereby reducing
the risk of such an ownership change.
Existing stockholders holding 4.99 percent or more of the
Company's outstanding shares of common stock are exempt from the
provisions of the Plan unless they make additional purchases.
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar International reported a net loss attributable to the
Company of $898 million for the year ended Oct. 31, 2013,
following a net loss attributable to the Company of $3.01 billion
for the year ended Oct. 31, 2012. The Company's balance sheet at
April 30, 2014, showed $7.72 billion in total assets, $11.79
billion in total liabilities and a $4.07 billion total
stockholders' deficit.
* * *
In the Oct. 9, 2013, edition of the TCR, Moody's Investors Service
affirmed the ratings of Navistar International Corporation,
including the B3 Corporate Family Rating (CFR). The ratings
reflect Moody's expectation that Navistar's successful
incorporation of Cummins engines throughout its product line up
will enable the company to regain lost market share, and that
progress in addressing component failures in 2010 vintage-engines
will significantly reduce warranty expenses.
As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings
Services lowered its long-term corporate credit rating on
Illinois-based truckmaker Navistar International Corp. (NAV) to
'CCC+' from 'B-'. "The rating downgrades reflect our increased
skepticism regarding NAV's prospects for achieving the market
shares it needs for a successful business turnaround," said credit
analyst Sol Samson.
In January 2013, Fitch Ratings affirmed the Issuer Default Ratings
(IDR) for Navistar International Corporation and Navistar
Financial Corporation at 'CCC' and removed the Negative Outlook on
the ratings. The removal reflects Fitch's view that immediate
concerns about liquidity have lessened, although liquidity remains
an important rating consideration as NAV implements its selective
catalytic reduction (SCR) engine strategy. Other rating concerns
are already incorporated in the 'CCC' rating.
NAVISTAR INTERNATIONAL: Inks Agreement with Icahn Group
-------------------------------------------------------
The Icahn Group entered into an agreement with Navistar
International Corporation pursuant to which the parties agree that
the "Ownership Limit" as defined in Section 2(c) of the Icahn
Settlement Agreement, is deemed to have terminated with respect to
the Icahn Group.
The Icahn Group and the Company are party to a settlement
agreement, effective as of Oct. 5, 2012, as amended on July 14,
2013. Notwithstanding the foregoing, the Icahn Group and each
member will remain subject to any restrictions applicable to
stockholders of the Company pursuant to the Rights Agreement,
dated June 19, 2012, by and among the Company and Computershare,
Inc., as amended from time to time and most recently as of
June 23, 2014.
A full-text copy of the regulatory filing is available at:
http://is.gd/mpPYxH
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar International reported a net loss attributable to the
Company of $898 million for the year ended Oct. 31, 2013,
following a net loss attributable to the Company of $3.01 billion
for the year ended Oct. 31, 2012. The Company's balance sheet at
April 30, 2014, showed $7.72 billion in total assets, $11.79
billion in total liabilities and a $4.07 billion total
stockholders' deficit.
* * *
In the Oct. 9, 2013, edition of the TCR, Moody's Investors Service
affirmed the ratings of Navistar International Corporation,
including the B3 Corporate Family Rating (CFR). The ratings
reflect Moody's expectation that Navistar's successful
incorporation of Cummins engines throughout its product line up
will enable the company to regain lost market share, and that
progress in addressing component failures in 2010 vintage-engines
will significantly reduce warranty expenses.
As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings
Services lowered its long-term corporate credit rating on
Illinois-based truckmaker Navistar International Corp. (NAV) to
'CCC+' from 'B-'. "The rating downgrades reflect our increased
skepticism regarding NAV's prospects for achieving the market
shares it needs for a successful business turnaround," said credit
analyst Sol Samson.
In January 2013, Fitch Ratings affirmed the Issuer Default Ratings
(IDR) for Navistar International Corporation and Navistar
Financial Corporation at 'CCC' and removed the Negative Outlook on
the ratings. The removal reflects Fitch's view that immediate
concerns about liquidity have lessened, although liquidity remains
an important rating consideration as NAV implements its selective
catalytic reduction (SCR) engine strategy. Other rating concerns
are already incorporated in the 'CCC' rating.
NAVISTAR INTERNATIONAL: Amends Settlement Pact with MHR
-------------------------------------------------------
MHR Institutional Partners III LP, MHR Institutional Advisors III
LLC, MHR Fund Management LLC, MHR Holdings LLC, and Mark H.
Rachesky, M.D., on June 23, 2014, entered into an agreement with
Navistar International Corporation amending and reflecting certain
understandings relating to the Settlement Agreement, effective
Oct. 5, 2012, and the Settlement Agreement Amendment, effective
July 14, 2013, in light of the adoption by the Company on June 23,
2014, of an amendment to its stockholder rights plan that turns
the stockholder rights plan into a tax asset protection plan. The
existing stockholders rights plan was scheduled to terminate on
July 1, 2014.
The reporting persons disclosed beneficial ownership of 13,997,556
common shares or 17.2 percent equity stake as of June 23, 2014.
A full-text copy of the regulatory filing is available at:
http://is.gd/ltrlci
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar International reported a net loss attributable to the
Company of $898 million for the year ended Oct. 31, 2013,
following a net loss attributable to the Company of $3.01 billion
for the year ended Oct. 31, 2012. The Company's balance sheet at
April 30, 2014, showed $7.72 billion in total assets, $11.79
billion in total liabilities and a $4.07 billion total
stockholders' deficit.
* * *
In the Oct. 9, 2013, edition of the TCR, Moody's Investors Service
affirmed the ratings of Navistar International Corporation,
including the B3 Corporate Family Rating (CFR). The ratings
reflect Moody's expectation that Navistar's successful
incorporation of Cummins engines throughout its product line up
will enable the company to regain lost market share, and that
progress in addressing component failures in 2010 vintage-engines
will significantly reduce warranty expenses.
As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings
Services lowered its long-term corporate credit rating on
Illinois-based truckmaker Navistar International Corp. (NAV) to
'CCC+' from 'B-'. "The rating downgrades reflect our increased
skepticism regarding NAV's prospects for achieving the market
shares it needs for a successful business turnaround," said credit
analyst Sol Samson.
In January 2013, Fitch Ratings affirmed the Issuer Default Ratings
(IDR) for Navistar International Corporation and Navistar
Financial Corporation at 'CCC' and removed the Negative Outlook on
the ratings. The removal reflects Fitch's view that immediate
concerns about liquidity have lessened, although liquidity remains
an important rating consideration as NAV implements its selective
catalytic reduction (SCR) engine strategy. Other rating concerns
are already incorporated in the 'CCC' rating.
NGL ENERGY: Moody's Assigns B2 Rating on $350MM Sr. Secured Notes
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to NGL Energy
Partners LP's (NGL) proposed offering of $350 million senior
unsecured notes due 2019. NGL's other ratings and stable outlook
were unchanged.
Net proceeds from this offering will be used to reduce borrowings
under NGL's revolving credit facilities. The proposed notes will
be jointly issued by NGL Energy Partners LP and its wholly-owned
subsidiary NGL Energy Finance Corp.
Issuer: NGL Energy Partners LP
Assignments:
US$350M Senior Unsecured Regular Bond/Debenture, Assigned B2,
LGD5, 81%
Ratings Rationale
The proposed unsecured notes will rank equally in right of payment
to NGL's existing 6.875% notes and hence the new notes were
assigned the same B2 rating. NGL's unsecured notes are rated two
notches below the Ba3 Corporate Family Rating (CFR) because of the
large proportion of secured debt in the capital structure. NGL has
$2.2 billion of secured revolving credit facilities plus $250
million of secured notes that have an all-asset pledge and a
priority claim over unsecured lenders.
The Ba3 CFR reflects NGL's diversified and partially vertically
integrated operations across several key US oil and gas basins;
significant fee-based cash flows from its water service,
terminal/storage and logistics businesses; a track record of
equity issuances when making large acquisitions, and a seasoned
management team with substantial ownership interest. The Ba3 CFR
is restrained by NGL's limited scale relative to higher rated
midstream peers; significant exposure to the weather, throughput
volumes, and oil and NGL price differentials; service-focused
businesses that have low barriers to entry; and increased leverage
following a series of acquisitions since mid-2013. The Ba3 rating
also considers NGL's Master Limited Partnership (MLP) structure
and highly acquisitive nature that demand strong operational
execution and constant access to capital markets.
The principal methodology used in this rating was the Global
Midstream Energy Industry Methodology published in December 2010.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Headquartered in Tulsa, Oklahoma, NGL Energy Partners LP is a
publicly traded MLP with diversified midstream assets in several
active oil and gas basins in North America.
NNN 3500 MAPLE 26: Seeks Combined Hearing on Admin. Claim Bids
--------------------------------------------------------------
In the Chapter 11 case of NNN 3500 Maple 26, LLC, the Bankruptcy
Court will hold a hearing July 3, 2014, on a Motion for leave for
Order Scheduling a Combined Hearing on or After September 4, 2014
to Consider All Trade-Related Administrative Expense Claims filed
by the Debtor.
This month, several parties-in-interest have filed separate
applications for administrative expenses:
* creditor Gary Connor;
* creditor Thompson Private Advisors, LLC;
* Interested Parties NNN 3500 Maple 11, LLC, NNN 3500
Maple 25, LLC, NNN 3500 Maple 35, LLC, NNN 3500
Maple 8, LLC, NNN 3500 Maple 9, LLC;
* creditor State of California Bankruptcy Section MS A340;
* creditor State of California Bankruptcy Section MS A340,
Franchise Tax Board; and
* creditor State of California
On May 30, the Bankruptcy Court granted the Debtor's motion to
establish June 30, 2014 as the "Bar Date for Filing Requests for
Allowance of Administrative Claims Arising on or Before May 31,
2014"; for approval of Notice Procedures with respect to the
Administrative Claims Bar Date; and to employ BMC Group, Inc. as
the Debtors' Tabulation Agent and Disbursing Agent as "Other
Professional (Amended)".
On April 25, the Court denied the motion of NNN 3500 Maple 26 et
al., and creditor and plan proponent Strategic Acquisition
Partners LLC, to:
1. impose the automatic stay of Section 362(a) of the
Bankruptcy Code with regards to the property located at
3500 Maple Avenue pending confirmation and effectiveness
of SAT's Second Amended Plan of Reorganization for the
Debtor;
2. reconsider the Court's memorandum opinion entered
April 10, 2014, and order entered April 14; and
3. set an expedited confirmation hearing on the Second
Amended Plan.
Bankruptcy Judge Harlin DeWane Hale on April 10 denied:
-- confirmation of two competing reorganization plans
filed in the Chapter 11 cases of NNN 3500 Maple 26
LLC and its affiliated debtors; and
-- terminated the automatic stay in the cases, pursuant
to an earlier order.
Judge Hale said both plans -- one proposed by the Debtors, and
another filed by Strategic Acquisition Partners, LLC, a party that
acquired a claim in the case -- fail to meet the legal
requirements imposed by 11 U.S.C. Sec. 1124(2) for reinstatement.
The Court, in its order, stated that the first plans of Strategic
and the Debtors were denied confirmation by written opinion. The
Court noted that the code does not contemplate treating the new
plans as a modification of the old ones.
The Court noted that, although it denied a motion to dismiss the
Debtor's case, filed by CWCapital Asset Management LLC -- in its
capacity as Special Servicer for U.S. Bank National Association,
as Trustee, successor-in-interest to Bank of America, N.A., as
Trustee for the Registered Holders of Wachovia Bank Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 2006-C23 -- the Court set deadlines for a deal or
confirmation at the end of February 2014, because the disputes
over the property have been going on at least since 2012. The
Court terminated exclusivity in the hope that some party would
make a deal with CWCapital or propose a plan which could be
confirmed over CWCapital's objection. No party filed a
confirmable plan and the deadline has passed. The new plans
simply come to the Court too late in the process.
On April 10, the Court issued its memorandum opinion on Plan
Confirmation pursuant to which, among other things, the Court
denied confirmation of the Plan, solely on the grounds that the
Note could not be reinstated pursuant to Section 1124(2) on the
terms set forth in the Plan.
On April 14, the Court issued the order granting motion for relief
from automatic stay, thereby permitting CWCAM to notice a proposed
foreclosure on the property. On April 14, CWCAM posted the
property for foreclosure, with a sale to take place on May 6.
Pursuant to the terms of the purchase and sale agreement between
CWCAM and Maple Avenue Tower, LLC, it was anticipated that CWCAM
would credit bid the full amount owed under the loan at
foreclosure and, if successful in acquiring the property, would
sell the property to MAT for $54.3 million some time thereafter.
If the property is sold for $54.3 million, the estates are left
administratively insolvent, the bankruptcy cases fall into the
hands of a Chapter 7 Trustee, and all holders of claims against
and interests in the Debtors, other than CWCAM, will be completely
wiped out.
About NNN 3500 Maple Entities
NNN 3500 Maple 26, LLC, based in Costa Mesa, Calif., filed for
Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 12-23718) on
Nov. 30, 2012. Judge Scott C. Clarkson presided over the case.
In its schedules, the Debtor disclosed $45,563,241 in total assets
and $46,658,593 in total liabilities.
On Jan. 23, 2013, the California Bankruptcy Court entered an order
transferring venue of the bankruptcy case to the U.S. Bankruptcy
Court for the Northern District of Texas (Case No. 13-30402).
Judge Harlin DeWayne Hale in Dallas presides over the case.
On Aug. 29, 2013, 26 other affiliates filed separate Chapter 11
petitions. These entities are: NNN 3500 Maple 1, LLC, NNN 3500
Maple 2, LLC, NNN 3500 Maple 3, LLC, NNN 3500 Maple 4, LLC, NNN
3500 Maple 5, LLC, NNN 3500 Maple 6, LLC, NNN 3500 Maple 7, LLC,
NNN 3500 Maple 10, LLC, NNN 3500 Maple 12, LLC, NNN 3500 Maple 13,
LLC, NNN 3500 Maple 14, LLC, NNN 3500 Maple 15, LLC, NNN 3500
Maple 16, LLC, NNN 3500 Maple 17, LLC, NNN 3500 Maple 18, LLC, NNN
3500 Maple 20, LLC, NNN 3500 Maple 22, LLC, NNN 3500 Maple 23,
LLC, NNN 3500 Maple 24, LLC, NNN 3500 Maple 27, LLC, NNN 3500
Maple 28, LLC, NNN 3500 Maple 29, LLC, NNN 3500 Maple 30, LLC, NNN
3500 Maple 31, LLC, NNN 3500 Maple 32, LLC, and NNN 3500 Maple 34.
Each Debtor holds an ownership interest as a tenant in common in
an 18-story commercial office building commonly known as 3500
Maple Avenue, Dallas, Texas 75219.
These TICs have not filed for bankruptcy: NNN 3500 Maple 0, LLC,
NNN 3500 Maple 8, LLC, NNN 3500 Maple 9, LLC, NNN 3500 Maple 11,
LLC, NNN 3500 Maple 25, LLC, and NNN 3500 Maple 35, LLC.
Bankruptcy Judge Harlin DeWane Hale denied confirmation of two
competing reorganization plans filed in the Chapter 11 cases of
NNN 3500 Maple 26 LLC and its affiliated debtors.
The Plan is to be funded by an $8.5 million "Cash Infusion" and
"Additional Equity Contributions" of around $10 million. Under
the Debtors' Plan, the building will undergo substantial
rehabilitation.
The Plan propose by Strategic Acquisition Partners, LLC, a party
that acquired a claim in the case, similar to the Debtors', in an
attempted cure and restatement, will replace the Borrower with
NewCo under the Loan Documents. NewCo will be divided into Class
A and Class B membership interests.
An official creditors' committee has not been appointed in this
case. Neither a trustee nor an examiner has been appointed.
The Debtors are represented by Michelle V. Larson, Esq., at
ANDREWS KURTH LLP, and Jeremy B. Reckmeyer, Esq., at ANDREWS KURTH
LLP.
Strategic Acquisition Partners LLC is represented by Joseph J.
Wielebinski, Esq., Davor Rukavina, Esq., Zachery Z. Annable, Esq.,
and Thomas D. Berghman, Esq., at MUNSCH HARDT KOPF & HARR, P.C.
William B. Finkelstein, Esq., Esq., and Jeffrey R. Fine, Esq., at
DYKEMA GOSSETT PLLC serve as counsel to Maple Avenue Tower, LLC.
NYTEX ENERGY: Sells 8 Million Shares to Cory Hall
-------------------------------------------------
The Board of Directors of NYTEX Energy Holdings, Inc., approved
the sale and issuance of 8,013,902 shares of common stock of the
Company to Cory Hall in exchange for consideration of $1,001,737
in accordance with the Securities Purchase Agreement executed on
June 20, 2014, between the Company and the Purchaser. The
Offering was made in reliance on the exemption provided by Rule
506(b) promulgated under the Securities Act of 1933, as amended,
and certain provisions of Regulation D thereunder based on Mr.
Hall's status as an accredited investor.
Mr. Hall Appointed to Board
Effective June 23, 2014, the Board approved an expansion of the
size of the Board from three to four members and appointed Cory
Hall to the vacancy on the Board created by that expansion. The
Board concluded to appoint Mr. Hall as a member of the Board based
on, among other factors, his successes in building two companies
(an E&P company and an oilfield service company) and selling them
both profitably, his exceptional reputation in the Permian basin,
and his extensive knowledge of the various emerging oil and gas
plays located in the Permian Basin, where NYTEX is focusing its
growth efforts.
Mr. Hall has not yet been appointed to any Board committees. Mr.
Hall is 39 years old and has no family relationships with anyone
on the Board or any of the officers of the Company.
In addition to his appointment as a member of the Board, effective
June 20, 2014, Mr. Hall was also appointed as the president and
chief operating officer of the Company.
Effective June 20, 2014, the Company and Mr. Hall entered into an
employment agreement relating to his position as president and
chief operating officer. In addition, Michael Galvis entered into
an employment agreement relating to his position as the Company's
chief executive officer. Each of these employment agreements
provides for a base salary of $375,000, subject to annual review
and potential increase by the Board.
Additional information is available for free at:
http://is.gd/r81K9y
About NYTEX Energy
Located in Dallas, Texas, Nytex Energy Holdings, Inc., is an
energy holding company with operations centralized in two
subsidiaries, Francis Drilling Fluids, Ltd. ("FDF") and NYTEX
Petroleum, Inc. ("NYTEX Petroleum"). FDF is a 35 year old full-
service provider of drilling, completion and specialized fluids
and specialty additives; technical and environmental support
services; industrial cleaning services; equipment rentals; and
transportation, handling and storage of fluids and dry products
for the oil and gas industry. NYTEX Petroleum, Inc., is an
exploration and production company focusing on early stage
development of minor oil and gas resource plays within the United
States.
The Company's balance sheet at Sept. 30, 2013, showed $8.02
million in total assets, $2.73 million in total liabilities, $4.76
million in mezzanine equity and $519,124 in total stockholders'
equity.
NYTEX Energy reported a net loss of $5.15 million in 2012, as
compared with net income of $16.75 million in 2011.
As reported by the TCR on May 8, 2014, NYTEX Energy has delayed
the filing of its annual report on Form 10-K for the year ended
Dec. 31, 2013.
"Due to limited financial resources, limited staff availability,
and the need to focus on operational and capital raising matters,
the process of compiling and disseminating the information
required to be included in the Form 10-K for the relevant fiscal
year cannot be completed without incurring undue hardship and
expense," the Company said.
PACIFIC GOLD: Asher Enterprises No Longer a Shareholder
-------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Asher Enterprises, Inc., disclosed that as of
June 24, 2014, it had ceased to beneficially own any shares of
common stock of Pacific Gold Corp. Asher Enterprises previously
held 2,722,405 shares at Nov. 1, 2013. A full-text copy of the
regulatory filing is available at http://is.gd/CRUcyh
About Pacific Gold
Las Vegas, Nev.-based Pacific Gold Corp. is engaged in the
identification, acquisition, and development of prospects believed
to have gold mineralization. Pacific Gold through its
subsidiaries currently owns claims, property and leases in Nevada
and Colorado.
Pacific Gold reported a net loss of $463,422 in 2013 following a
net loss of $16.62 million in 2012. The Company's balance sheet
at March 31, 2014, showed $1.68 million in total assets, $4
million in total liabilities and a $2.32 million total
stockholders' deficit.
Silberstein Ungar, PLLC, 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 losses from operations, has negative working capital, and
is in need of additional capital to grow its operations so that it
can become profitable. These factors raise substantial doubt
about the Company's ability to continue as a going concern.
PALM BEACH BREWERY: Glades Brewery's Chapter 11 Case Summary
------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Glades Brewery Partners, Ltd 14-24492
301 Yamato Road, Ste 3101
Boca Raton, FL 33431
Glades Brewery, Inc. 14-24493
301 Yamato Road, Ste 3101
Boca Raton, FL 33431
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Hon. Erik P. Kimball
Debtors' Counsel: Kenneth S Rappaport, Esq.
RAPPAPORT OSBORNE & RAPPAPORT PL
1300 N Federal Hwy #203
Boca Raton, FL 33432
Tel: (561) 368-2200
Email: rappaport@kennethrappaportlawoffice.com
Estimated Estimated
Assets Liabilities
---------- -----------
Glades Brewery Partners, Ltd. $1MM-$10MM $1MM-$10MM
Glades Brewery, Inc. $1MM-$10MM $1MM-$10MM
The petitions were signed by Morris L. Stoltz, sole stockholder,
Glades Brewery, Inc., general partner.
A copy of Glades Brewery Partners's largest unsecured creditor is
available for free at http://bankrupt.com/misc/flsb14-24492.pdf
Pending bankruptcy cases filed by affiliates:
Petition
Debtor/District Case No. Date
--------------- -------- ---------
Palm Beach Brewery Associates, Inc. 14-24149 06/20/2014
Southern District of Florida
Palm Beach Brewery Associates, Ltd. 14-24148 06/20/2014
Southern District of Florida
PPL ENERGY: Moody's Lowers Senior Unsecured Rating to 'Ba1'
-----------------------------------------------------------
Moody's Investors Service downgraded the senior unsecured rating
of PPL Energy Supply, LLC (Supply) to Ba1 from Baa3. As part of
this rating action, Moody's assigned Supply a Corporate Family
Rating of Ba1, a Probability of Default Rating of Ba1-PD, and a
Speculative Grade Liquidity rating of SGL-1. Moody's also lowered
Supply's commercial paper rating to Not Prime from Prime-3. These
rating actions on Supply do not affect ratings of PPL Corp. (Baa3
positive) or its other subsidiaries. Supply's rating outlook
remains negative.
Ratings Rationale
The downgrade of Supply's rating to Ba1 from Baa3 reflects our
ongoing assessment of the company's business strategy which will
incorporate a higher business risk and increased leverage profile,
as Moody's understand that Supply intends operate its business
with a materially higher risk appetite as an independent power
producer, including acquiring more assets without issuing equity.
While Supply's plans to combine its competitive electric business
with Riverstone's generation portfolio exemplifies this concern,
the rating action incorporates a changed view of the company's
direction regardless of whether the transaction with Riverstone is
completed.
Supply's Ba1 rating reflects the company's strength of its asset
portfolio, the potential for higher debt leverage as an
independent power company, and the lack of a track record as a
newly independent company. Like many of its peers, Supply has
experienced a severe downturn in the US merchant markets in the
past few years. However, Supply's situation is not as dire due to
deleveraging at Supply (prior to PPL's announcement to spin), cost
cutting initiatives and the location of most of its generation
assets which provide somewhat higher capacity payments to Supply
across the fleet. Even though Supply has maintained solid credit
metrics despite the current downturn in the merchant markets,
Moody's believe its debt leverage will increase as an independent,
high growth company with a more aggressive business model.
S&P's speculative grade liquidity rating of SGL-1 incorporates
Supply's liquidity conditions, which includes strong internal cash
flow generation, access to a $3 billion unsecured revolving
facility, ample headroom under the financial covenants, and the
ability to sell assets, if needed, for alternate liquidity. Our
SGL-1 incorporates our assessment of Supply prior to the spin.
Moody's understand that at the time of the spin and subsequent
merger with the Riverstone entities, new credit facilities will be
established at the Talen Energy Corporation level leading to a
reassignment of an SGL rating at this newly formed entity.
Rating Outlook
Supply's negative outlook reflects the potential for a further
rating downgrade, which depending on a better understanding of the
merged entity and their related plants since the much larger
Supply is being combined with substantially lower rated entities
from Riverstone.
What Could Change the Rating - UP
In light of the rating action and the negative outlook, limited
prospects exist for the rating to be upgraded, particularly given
to the still challenging merchant power market environment and the
more aggressive business and financial strategy generally
associated with pure-play merchant power companies.
What Could Change the Rating - DOWN
The rating could be downgraded at the completion of the spinoff
given the weaker credit quality and higher leverage of the merged
entity along with a deeper understanding of the growth strategies
and leverage targets of this new concern.
Corporate Profile
Supply is a merchant power company with about 10 gigawatts (GW) of
generating capacity in Pennsylvania and Montana. Supply is
currently an indirect wholly-owned subsidiary of PPL Corporation
(PPL, Baa3 positive). PPL is headquartered in Allentown, Pa. and
currently controls or owns about 19 GW of generating capacity in
the United States. On June 9, 2014, PPL announced that it will
spin off Supply to existing shareholders and be merged with
Riverstone Holdings LLC's merchant power operation at closing. The
merged entity, to be named Talen Energy Corporation, will be a
stand-alone, publicly traded independent power producer with 15
gigawatts of generating capacity. Riverstone's merchant assets
involved in this merger include assets currently held by Topaz
Power Holdings, LLC (B1 Negative), Sapphire Power Finance LLC (B1
negative) and Raven Power Finance, LLC (B1 stable).
Downgrades:
Issuer: Pennsylvania Economic Dev. Fin. Auth.
Senior Unsecured Revenue Bonds, Downgraded to Ba1, 52-LGD4 from
Baa3
Issuer: PPL Energy Supply, LLC
Preferred Shelf, Downgraded to (P)Ba3 from (P)Ba2
Subordinate Shelf, Downgraded to (P)Ba2 from (P)Ba1
Senior Unsecured Shelf, Downgraded to (P)Ba1 from (P)Baa3
Senior Unsecured Bank Credit Facility, Downgraded to Ba1, 52-
LGD4 from Baa3
Senior Unsecured Commercial Paper, Downgraded to NP from P-3
Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1,
52-LGD4 from Baa3
Assignments:
Issuer: PPL Energy Supply, LLC
Probability of Default Rating, Assigned Ba1-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Corporate Family Rating, Assigned Ba1
Senior Unsecured Regular Bond/Debenture, Assigned Ba1, 52-LGD4
Outlook Actions:
Issuer: PPL Energy Supply, LLC
Outlook, Remains Negative
The principal methodology used in this rating was the Unregulated
Utilities and Power Companies published in August 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
PLAYBOY ENTERPRISES: Moody's Withdraws 'B2' Corp. Family Rating
---------------------------------------------------------------
Moody's Investors Service has withdrawn Playboy Enterprises,
Inc.'s B2 Corporate Family Rating (CFR), B3-PD Probability of
Default Rating (PDR) and B2 ratings on its existing term loan and
revolving credit facility.
The company has notified lenders that it is in talks with a single
lender to raise a new term loan. Proceeds will be used to fully
repay and extinguish its existing term loan ($147 million
outstanding) and $10 million revolving credit facility.
Ratings Withdrawn:
Issuer: Playboy Enterprises, Inc.
Corporate Family Rating - B2
Probability of Default Rating - B3-PD
$10 Million Senior Secured Revolving Credit Facility due 2016
-- B2 (LGD-3, 31%)
$185 Million ($147 Million outstanding) Senior Secured Term
Loan due 2017 -- B2 (LGD-3, 31%)
QOL MEDS: Moody's Assigns 'B2' CFR & Rates 1st Lien Debt 'B2'
-------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
and a B2-PD Probability of Default Rating to QoL meds, LLC.
Concurrently, Moody's assigned a B2 rating to the company's
proposed first lien senior secured credit facilities. QoL is an
operator of on-site pharmacies in community mental health centers
("CMHC") in US states. The rating outlook is stable. This is the
first time that Moody's has assigned ratings to QoL.
The first lien credit facilities will be comprised of a $30
million revolving credit facility and a $285 million term loan.
The company intends to use proceeds from the debt issuance,
combined with new cash equity from its financial sponsors, to fund
the acquisition of Genoa Holding Company, Inc. ("Genoa"), to
refinance existing debt, and to pay fees and expenses.
The following ratings have been assigned to QoL subject to review
of final documentation:
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
First lien senior secured credit facilities at B2 (LGD 4)
Rating Rationale
The B2 CFR reflects QoL's small scale in narrow market niche, high
leverage, and modest operating margins. The rating also
incorporates business risks associated with the company's heavy
reliance on government programs such as Medicare and Medicaid for
more than 90% of its total revenue, high revenue and earnings
concentration in several states, and hence exposure to state
budget pressure and healthcare reform. Moody's expects that there
will be continued focus on implementing measures to contain
healthcare cost that will pressure Medicare and Medicaid
reimbursement rates over the next few years. The rating also
incorporates Moody's consideration of the integration risks from
the Genoa acquisition, which will more than double the company's
revenues .
Despite the initial high leverage (around 6.5x debt/EBITDA
excluding synergies and losses add-backs from recently opened
facilities), the B2 rating reflects Moody's anticipation of
deleveraging over the next 12-18 months to around 5x. The rating
is also supported by QoL's market position as the leading on-site
pharmacy operator for CMHCs in the US following the Genoa
acquisition. The rating also incorporates the company's continued
revenue growth supported by positive same store sales growth
driven by patient population expansion and the ramp-up by newly
opened pharmacies, as well as from De Novo openings. Moody's also
recognizes the company's recent track record of maintaining and
improving operating margins despite reimbursement pressures.
The stable outlook reflects Moody's view that the company will
steadily reduce financial leverage through a combination of modest
EBITDA growth and debt repayment. The outlook also reflects
Moody's expectation that QoL will integrate the Genoa acquisition
without significant disruptions, and that synergies will begin to
be realized shortly after the transaction's closure. Moody's
expects the company to maintain stronger credit metrics than other
B2 rated companies in order to compensate for its high business
risk.
The ratings could be downgraded if the QoL is unable to delever as
expected due to deterioration in operating performance or a change
in financial policy. Ratings could also be downgraded if the
company fails to integrate Genoa successfully, or faces
significant reimbursement pressures that are not offset by cost
saving initiatives. The rating could also be downgraded if the
company engages in a material debt-financed acquisitions or
shareholder distributions, or if liquidity deteriorates.
Moody's does not expect an upgrade in the near to medium term due
to the company's singular industry focus, small scale, revenue
concentration to government payors, and earnings sensitivity to
state and federal budgets. Longer-term, the rating could be
upgraded if Moody's expects QoL to increase revenue and improve
margins sustainably, as well as diversify its payor base and state
presence. A longer track record of its ability to mitigating
reimbursement rate pressure and adherence to a conservative
financial policy will also support a rating upgrade. In addition,
an upgrade would require adjusted debt/EBITDA to be sustained
below 4.0 times.
The principal methodology used in this rating was Global Business
& Consumer Service Industry Rating Methodology published in
October 2010. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
QoL meds, LLC, headquartered in Pittsburgh, Pennsylvania, provides
on-site pharmacy services to the patients of community mental
health centers. QoL meds is acquiring Genoa Healthcare. Combined,
QoL meds will operate 216 pharmacies across 34 states. QoL meds is
majority owned by private equity firm Nautic Partners.
REFCO PUBLIC: Plan Outline OK'd, Confirmation Hearing on Sept. 9
----------------------------------------------------------------
Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the
District of Delaware approved the disclosure statement explaining
Refco Public Commodity Pool, L.P.'s Plan of Liquidation, after
determining that the outline contained adequate information within
the meaning of Section 1125 of the Bankrptcy Code.
Under the Plan, holders of allowed secured and unsecured claims
are not impaired and will receive full payment with interest on or
as soon as practicable after the effective date of the Plan.
Holders of limited partnership interests will each receive a pro
rata share of remaining cash after payment of claims and will vote
on the Plan. Holders of subordinated interests are not receiving
anything and are deemed to reject the Plan. There are
approximately 1,700 limited partners.
As of the date of filing of the bankruptcy case, the Fund has
$11.97 million in cash. The Fund expects to receive substantial
additional distributions from the SPhinX Group through the end of
its liquidation.
The Plan provides that MAA, LLC, a Delaware limited liability
company, the liquidating trustee appointed in the Chancery Court
Proceeding, will serve as plan administrator.
A hearing to consider confirmation of the Plan will be held on
Sept. 9, 2014, at 10:00 a.m. (Prevailing Eastern Time).
Objections, if any, to confirmation of the Plan will be in writing
and must be filed with the Court on or before Sept. 2.
About Refco Public Commodity
Refco Public Commodity Pool, L.P., also known as S&P Managed
Futures Index Fund, L.P., is a fund that was formed in May 2003 to
make investments that substantially track the performance of the
Standard & Poor's Managed Futures Index. It did this by investing
substantially all of its assets in SPhinX Managed Futures Fund,
SPC, a Cayman Islands domiciled segregated portfolio company.
RefcoFund Holdings, LLC was the general partner of the Fund.
Refco Public filed a Chapter 11 bankruptcy petition (Bankr. D.
Del. Case No. 14-11216) in Wilmington, Delaware, on May 13, 2014.
Daniel F. Dooley signed the petition as managing member of MAA,
LLC. The Debtor estimated assets of $17 million and debt of $0.
The case is assigned to Judge Brendan Linehan Shannon. Alston &
Bird LLP in Atlanta, Georgia, serves as the Debtor's counsel.
Richards, Layton & Finger, in Delaware, acts as local counsel.
Morris Anderson & Associates, Ltd., is the Debtor's financial
advisor, and Maples & Calder serves as the Debtor's Cayman Islands
counsel.
REVEL AC: Section 341(a) Meeting Scheduled for July 22
------------------------------------------------------
A meeting of creditors in the bankruptcy cases of Revel AC, Inc.,
and five of its debtor affiliates will be held on July 22, 2014,
at 1:30 p.m. at Bridge View - Camden. Deadline to file proofs of
claim will be set at a later date.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
meeting of creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
About Revel AC
Revel AC, Inc. -- http://www.revelresorts.com/-- owns and
operates Revel, a Las Vegas-style, beachfront entertainment resort
and casino located on the Boardwalk in the south inlet of Atlantic
City, New Jersey.
Revel AC Inc. and five of its affiliates sought bankruptcy
protection (Bankr. D.N.J., Lead Case No. 14-22654) on June 19,
2014, listing assets ranging from $500 million to $1 billion, and
the same amount of liabilities. The case is assigned to Judge
Gloria M. Burns.
White & Case, LLP, and Fox Rothschild, LLP, serve as the Debtors'
counsel. The Debtors' claims and noticing agent is Alixpartners,
LLP.
This is Revel AC's second trip to bankruptcy. The company, along
with four affiliates first sought bankruptcy protection (Bankr.
D.N.J. Lead Case No. 13-16253) on March 25, 2013, with a
prepackaged plan that reduces debt by $1.25 billion. Less than
two months later on May 15, 2013, the 2013 Plan was confirmed and
became effective on May 21, 2013.
RJS POWER: S&P Assigns 'B+' ICR & Rates $1.25BB Sr. Notes 'BB-'
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' issuer credit
rating to RJS Power Holdings LLC. Standard & Poor's also assigned
its 'BB-' issue rating to the company's $1.25 billion senior
unsecured notes. S&P is placing all ratings on CreditWatch with
positive implications. The recovery score on the unsecured debt
is '2', reflecting S&P's view that there would be substantial (70%
to 90%) recovery under its simulated default scenario.
"We consider RJS's business risk profile 'weak,' its financial
risk profile as 'aggressive,' and its liquidity as 'adequate',
said Standard & Poor's credit analyst Michael Ferguson.
RJS Power Holdings LLC is an unregulated electricity generation
company with roughly 5.3 GW of capacity, and assets located in
four different states (Texas, Maryland, New Jersey, and
Massachusetts) across two different interconnections (the Electric
Reliability Council of Texas [ERCOT] and Pennsylvania-New Jersey-
Maryland [PJM]). The company has a diverse portfolio consisting
of coal and natural gas assets that dispatch from base load to
peaking levels.
The placement of the ratings on CreditWatch with positive
implications reflects S&P's view of the pending merger with PPL
Energy Supply LLC, which RJS Power announced prior to this
proposed debt issuance. Should the merger be consummated as
expected, S&P could raise the issuer credit rating on RJS Power to
reflect the higher credit quality of PPL Energy Supply LLC, which
has generating capacity that is about twice that of RJS Power.
However, S&P would first have to consider the legal details of the
transaction, as well as the consolidated capital structure.
Depending on the terms of the merger, S&P could raise the combined
ICR on the companies to 'BB-' or 'BB'.
ROBSHIR PROPERTIES: Case Summary & 7 Top Unsecured Creditors
------------------------------------------------------------
Debtor: Robshir Properties, LLC
P.O. Box 18272
Cleveland Heights, OH 44121
Case No.: 14-14101
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Northern District of Ohio (Cleveland)
Judge: Hon. Jessica E. Price Smith
Debtor's Counsel: Mark S. O'Brien, Esq.
2460 Fairmount Boulevard, Suite 301B
Cleveland Heights, OH 44106
Tel: 216-229-5000
Fax: 216-229-5507
Email: msobrien9@att.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robert L. Lyons, Jr., sole member-
manager.
A list of the Debtor's seven largest unsecured creditors is
available for free at http://bankrupt.com/misc/ohnb14-14101.pdf
ROOMLINX INC: Posts $539K Net Loss in Q1 Ended March 31
-------------------------------------------------------
RoomLinx, Inc., filed its quarterly report on Form 10-Q,
disclosing a net loss of $539,378 on $1.63 million of total
revenues for the three months ended March 31, 2014, compared with
a net loss of $1.4 million on $2.01 million of total revenues for
the same period in 2013.
The Company's balance sheet at March 31, 2014, showed $6.24
million in total assets, $10.75 million in total liabilities, and
a stockholders' deficit of $4.5 million.
The Company has experienced recurring losses and negative cash
flows from operations. At March 31, 2014, the Company had
balances of cash and cash equivalents of $2.08 million, working
capital deficit of $1.15 million, and accumulated deficit of
$42.25 million. To date the Company has in large part relied on
debt and equity financing to fund its shortfall in cash generated
from operations. As of March 31, 2014, the Company has available
approximately $19.8 million under its line of credit. The
Company's cash balance has remained relatively constant through
the twelve months ended March 31, 2014. If the Company is unable
to borrow additional funds under the line of credit or obtain
financing from alternative sources, the Company estimates its
current cash and cash equivalents are sufficient to fund
operations for at least the next twelve months. These factors
raise substantial doubt about the Company's ability to continue as
a going concern, according to the Company's regulatory filing.
A copy of the Form 10-Q is available:
http://is.gd/4gOPE3
About RoomLinX
Headquartered in Bloomfield, Colorado, RoomLinX, Inc. (PINKSHEETS:
RMLX) -- http://www.roomlinx.com/-- is a pioneer in Broadband
High Speed Wireless Internet connectivity, specializing in
providing the most advanced Wi-Fi Wireless and Wired networking
solutions for High Speed Internet access to Hotel Guests,
Convention Center Exhibitors, Corporate Apartments, and Special
Event participants. Designing, deploying and servicing site-
specific wireless networks for the hospitality industry is
RoomLinX's core competency.
ROSE ROCK: Moody's Assigns Ba3 CFR & Rates $350MM Unsec. Notes B1
-----------------------------------------------------------------
Moody's Investors Service assigned a first time rating of B1 to
Rose Rock Midstream, L.P.'s proposed $350 million senior unsecured
notes due 2022. Rose Rock Finance Corporation is a wholly-owned
subsidiary of Rose Rock and serves as the co-issuer of the notes.
Moody's assigned a Ba3 Corporate Family Rating (CFR), a Ba3-PD
Probability of Default Rating (PDR), and a SGL-3 Speculative Grade
Liquidity Rating (SGL). The outlook is stable.
Rose Rock and SemGroup Corporation (B1 stable) announced that Rose
Rock has acquired from SemGroup the remaining one-third interest
in SemCrude Pipeline, L.L.C., (unrated) which owns a 51% interest
in White Cliffs Pipeline L.L.C. (unrated) for $300 million. Rose
Rock now owns a 100% interest in SemCrude Pipeline and indirectly
owns a 51% interest in White Cliffs Pipeline. Rose Rock also
closed the transaction to acquire crude oil trucking assets from a
subsidiary of Chesapeake Energy Corporation (Ba1 stable). Both
transactions were funded with borrowings under Rose Rock's $585
million senior secured revolving credit facility. Net proceeds of
this offering will be used to repay outstanding borrowings on Rose
Rock's revolving credit facility, and for general partnership
purposes.
"The new notes will enhance liquidity and provide Rose Rock with
increased financial flexibility to fund expansion projects in
2014," stated Michael Somogyi, Moody's Vice President -- Senior
Analyst.
Rating Assignments:
Rose Rock Midstream, L.P.
Corporate Family Rating (CFR), assign Ba3
Probability of Default Rating (PD), assign Ba3-PD
Speculative Grade Liquidity Rating (SGL), assign SGL-3
Rose Rock Midstream, L.P. & Rose Rock Finance Corporation
$350 million senior unsecured notes due 2022, assign B1 (LGD-5,
75%)
Outlook, stable
Ratings Rationale
The B1 ratings on the senior unsecured notes reflect the company's
probability of default of Ba3-PD and a loss given default of LGD5
(75%). The notes are guaranteed on a senior unsecured basis and
rank structurally subordinate to Rose Rock's $585 million senior
secured revolving credit facility. The potential priority secured
claim of the secured revolver relative to the unsecured notes
results in the proposed $350 million unsecured notes being rated
one notch beneath the Ba3 CFR under Moody's Loss Given Default
Methodology.
Rose Rock's Ba3 CFR is reflective of its predominantly fee-based
services and fixed-margin transactions within strong growth areas
that mitigate commodity price volatility and provide for stable,
visible cash flow growth potential. The rating also incorporates
the strategic nature of its assets, its relationship with SemGroup
(B1 stable) and the credit strength of its top customers. The
rating is constrained by Rose Rock's small size, scale and the
risks inherent in the business model for growth-oriented MLPs.
SemGroup Corporation emerged from bankruptcy in November 2009 with
a new management team and a more fee-based business model. The
company owns a diverse suite of mid-stream assets focused on the
gathering, transportation, and storage of crude oil and natural
gas. The company's core crude oil gathering, transportation, and
storage assets are held at Rose Rock Midstream, a subsidiary of
SemGroup, that completed its IPO in December 2011 as a Master
Limited Partnership (MLP).
Rose Rock engages in crude oil gathering, transportation, storage,
distribution, and marketing operations. The majority of its assets
are located in or connected to Cushing with numerous
interconnections to other terminals and pipelines that provide its
customers with multiple options for the receipt and delivery of
crude oil. The strategic location of these assets are well
positioned to take advantage of both the increased throughput at
Cushing and the growing production volumes seen in the Bakken, DJ
Basin, Niobrara, Granite Wash and Mississippi Lime Play. Rose
Rock's core White Cliffs Pipeline is a 527-mile pipeline system
that transport crude oil from Platteville, Colorado in the DJ
Basin to Cushing, Oklahoma. White Cliffs is executing an expansion
project which will increase the capacity of the pipeline from
approximately 76,000 barrels per day to about 150,000 barrels per
day. The expansion is targeted to be in service in the third
quarter of 2014. Rose Rock operates the White Cliffs Pipeline with
its top customers Kerr-McGee (subsidiary of Anadarko Petroleum
rated Baa3 positive), Noble Energy (Baa2 stable) and Plains
Pipeline (subsidiary of Plains All American Pipeline L.P. rated
Baa2 positive) owning the remaining 49%.
The SGL-3 Speculative Grade Liquidity Rating reflects adequate
liquidity through 2015. Pro Forma for the $350 million notes, Rose
Rock will have over $500 million of availability on its $585
million senior secured revolver. This will provide sufficient
liquidity to cover the capital outspend of internally generated
cash flows resulting from $125 million capital budget and
increased cash distributions based on its MLP corporate structure.
The credit agreement expires in September 2018 and is subject to a
debt/EBITDA leverage covenant of no more than 5.0x and an
EBITDA/interest coverage covenant of no less than 2.5x. Moody's
expect Rose Rock will remain in compliance with its financial
covenants through this period. Alternative sources of liquidity
are limited principally to the sale of existing assets, which are
mostly encumbered.
The stable outlook reflects the earnings potential of asset
expansions. The ratings could be upgraded if Rose Rock is able to
ramp up size and build additional scale without adversely
affecting its leverage. The ratings could be downgraded if Rose
Rock's financial leverage increases due to debt funded
acquisitions or elevated capital expenditures. More specifically,
if debt to EBITDA cannot be sustained under 5.0x a ratings
downgrade could result. A downgrade is also likely if the company
produces any material losses from its marketing business.
The principal methodology used in this rating was the Global
Midstream Energy published in December 2010. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in June
2009.
Rose Rock Midstream, L.P. is a master limited partnership formed
by SemGroup Corporation in 2011 to own, operate, develop, and
acquire a portfolio of midstream energy assets. Rose Rock is
headquartered in Tulsa, Oklahoma.
SAN FERNANDO REDEVELOPMENT: S&P Affirms 'BB+' Rating on 2006 Bonds
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on San
Fernando Redevelopment Agency (RDA), Calif.'s series 2006 Civic
Center Redevelopment Project (Project No. 3) tax allocation bonds
(TABs) to stable from negative and affirmed its 'BB+' rating on
the bonds.
"The outlook revision reflects our view of weak-yet-adequate
revenue available in the redevelopment property tax trust fund to
pay debt service on the TABs; and the successor agency's improved
debt performance," said Standard & Poor's credit analyst Michael
Stock.
The ratings reflect S&P's view of the RDA's:
-- Thin maximum annual debt service (MADS) coverage of 1.01x,
-- High concentrated tax based at 58% of incremental assessed
values (AV) around industrial manufacturing, and
-- Below-average income indicators, as measured by per capita
EBI at 54%.
The bonds are secured by tax increment revenues collected from the
RDA's Project Area No. 3, which consists of a 150-acre original
area created in 1973 and a 214-acre amendment area added in 1986,
net of the 20% set-aside for low- and moderate-income housing and
contractual pass-through payments. The combined project area
covers 364 acres that are primarily industrial (48% of total AV),
followed by commercial (19%) and residential (14%).
The stable outlook reflects S&P's view of improved AV trends and
the successor agency's improved debt management abilities. Should
the successor agency fail to manage its cash in order make timely
semiannual debt service payments or should AV trends reverse, S&P
could further lower the rating. S&P could raise the rating should
AV continue to rise or should the successor agency decide to
reserve funds in its recognized obligation payment schedule.
SEARS METHODIST: U.S. Trustee Names 3-Member Creditors' Panel
-------------------------------------------------------------
William T. Neary, U.S. Trustee for Region 6, notified the U.S.
Bankruptcy Court for the Northern District of Texas that the
following creditors have been appointed as members of the Official
Committee of Unsecured Creditors in the Chapter 11 cases of Sears
Methodist Retirement System, Inc., et al.:
(1) Jennifer J. Young
Resident at Meadow Lake
15811 Rolling Green Cove
Tyler, TX 75703
Tel: (903) 525-9541
Cell: (314) 276-7323
E-mail: jenniferyoung@jenniferyoungmail.com
(2) Sysco USAI Inc.
Jim Beck
Senior Director Credit Risk Department
1390 Enclave Parkway
Houston, TX 77077
Tel: (281) 815-7320
Fax: (281) 584-2510
E-mail: Beck.james@corp.sysco.com
(3) Select Medical Inc.
Burdine Pucylowski
V.P. of Business Development
4025 Tampa Road, Suite 1106
Oldsmar, FL 34677
Tel: (321) 480-7036
Fax: (717) 975-9891
E-mail: bpucylowski@selectmedical.com
On June 17, 2014, the U.S. Bankruptcy Court for the Northern
District of Texas entered an order granting complex Chapter 11
bankruptcy case treatment. The Court sets these dates and times
for the next two months as the pre-set hearing dates and times for
hearing all motions and other matters in these cases:
July 14, 2014, at 2:30 p.m. (CST); Aug. 8, 2014, at 9:30 a.m.
(CST); and Aug. 29, 2014, at 9:30 (CST). The Debtors will
maintain a service list identifying the parties that must be
served whenever a motion or other pleading requires notice.
Unless otherwise required by the Bankruptcy Code or Rules, notices
of motions and other matters will be limited to the parties on the
service list.
About Sears Methodist
Sears Methodist Retirement System, Inc., sought protection under
Chapter 11 of the Bankruptcy Code on June 10, 2014 (Case No. 14-
32821, Bankr. N.D. Tex.). The case is assigned to Judge Stacey G.
Jernigan. The Debtors' counsel is Vincent P. Slusher, Esq., and
Andrew Zollinger, Esq., at DLA Piper LLP (US), in Dallas, Texas;
and Thomas R. Califano, Esq., Gabriella L. Zborovsky, Esq., and
Jacob S. Frumkin, Esq., at DLA Piper LLP (US), in New York. The
Debtors' financial advisor is Alvarez & Marsal Healthcare Industry
Group, LLC, while the Debtors' investment banker is Cain Brothers
& Company, LLC. The Debtors' notice, claims and solicitation
agent is GCG Inc.
SEARS METHODIST: Files List of 30 Largest Unsecured Creditors
-------------------------------------------------------------
Sears Methodist Retirement System, Inc., et al., filed with the
U.S. Bankruptcy Court for the Northern District of Texas their
list of 30 creditors holding largest unsecured claims to disclose
the following:
Creditor Nature of Debt Claim Amount
-------- -------------- ------------
1. Life Care Services LLC Trade $891,274
Capital Square
400 Locust STE
820 Des Moines, IA
50309-2334
Tel: (515) 875-4500
Fax: (515) 875-4780
E-mail: info@lcsnet.com
Life Care Services LLC
c/o Hinckley Allen
Attn: William S. Fish Jr.
20 Church Street
Hartford, CT 06103
Tel: (860) 725-6200
Fax: (860) 278-3802
E-mail: wfish@hinckleyallen.com
2. Select Medical Rehabilitation Trade $795,030
Services
4025 Tampa Road, Suite 1106
Oldsmar, FL 34677
Tel: (888) 974-7878 x 6019
E-mail: lcutrell@selectmedical.com
Select Medical Rehabilitation
Services
4714 Gettysburg Road
Mechanicsburg, PA 17055
Tel: (888) 735-6332
3. Cliftonlarson Allen LLP Professional $157,200
Attn: Michael Siegel
5001 Spring Valley Road STE 600W
Dallas, TX 75244
Tel: (972) 383-5700
Fax: (972) 383-5750
E-mail: michael.siegel@claconnect.com
4A. Sysco West Texas Trade $211,512
4B. Syco Central Texas Inc Trade $47,652
4C. Sysco New Mexico Trade $8,605
4D. Sysco East Texas Trade $5,409
5. Texas Methodist Foundation Trade $92,034
6. McKesson Medical Surgical Trade $90,078
7. Critical Health Connection Inc Trade $85,499
8. Omnicare-APS Lubbock Trade $56,772
9. Bontke Brothers Trade $52,477
10. Mayfield Paper Trade $51,344
11. Omnicare, Inc. Trade $36,162
12. Diana McIver & Associates Inc Trade $35,000
13. Medline Industries Inc Trade $32,810
14. Bibby Financial Services Inc Trade $32,296
15. Omnicare Of FT Worth Trade $28,112
16. Cunningham Distributing Inc Trade $24,000
17. El Paso Electric Company Trade $23,139
18. Lowe's Companies, Inc. Trade $18,041
19. ETMC First Physicians Trade $17,119
20. Healthmedx LLC Trade $14,444
21. Direct Supply, Inc. Trade $14,076
22. Knight Carpet & Flooring Trade $13,861
23. Summit Litho Trade $13,757
24. Carls McDonald & Dalrymple LLP Professional $13,051
25. Sea Isle Corporation Trade $13,042
26. Stericycle, Inc. Trade $12,303
27. Ben E. Keith Trade $11,713
28. Evans Pharmacy Trade $11,478
29. US Foods Inc Trade $9,967
30. Suddenlink - Dallas Trade $7,414
About Sears Methodist
Sears Methodist Retirement System, Inc., sought protection under
Chapter 11 of the Bankruptcy Code on June 10, 2014 (Case No. 14-
32821, Bankr. N.D. Tex.). The case is assigned to Judge Stacey G.
Jernigan. The Debtors' counsel is Vincent P. Slusher, Esq., and
Andrew Zollinger, Esq., at DLA Piper LLP (US), in Dallas, Texas;
and Thomas R. Califano, Esq., Gabriella L. Zborovsky, Esq., and
Jacob S. Frumkin, Esq., at DLA Piper LLP (US), in New York. The
Debtors' financial advisor is Alvarez & Marsal Healthcare Industry
Group, LLC, while the Debtors' investment banker is Cain Brothers
& Company, LLC. The Debtors' notice, claims and solicitation
agent is GCG Inc.
SHERMAN INDUSTRY: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Sherman Industry, Inc.
98 B Bond Street
Westbury, NY 11590
Case No.: 14-72944
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
Eastern District of New York (Central Islip)
Judge: Hon. Alan S Trust
Debtor's Counsel: Gary C Fischoff, Esq.
BERGER, FISCHOFF & SHUMER, LLP
40 Crossways Park Drive
Woodbury, NY 11797
Tel: 516-747-1136
Email: gfischoff@bfslawfirm.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Thomas Sherman, Sr., authorized
individual.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
SHILO INN: Hearing on Cash Collateral Use Set For July 1
--------------------------------------------------------
Shilo Inn, Twin Falls, LLC, et al., seek permission from the U.S.
Bankruptcy Court for the Central District of California to use
cash collateral of California Bank and Trust in order to pay the
expenses of maintaining and operating their businesses through
Nov. 6, 2014.
A copy of the budget is available for free at:
http://bankrupt.com/misc/SHILOINN_338_cashcoll.pdf
A hearing on the Debtors' motion is set for July 1, 2014, at 11:00
a.m.
CB&T is the primary, senior secured lender in each of the Debtors'
seven cases, and, in each instance, has a secured lien on the
Debtors' seven hotels and an interest in their cash collateral.
The Debtors submit that CB&T and other secured creditors are
adequately protected by the use of cash collateral. CB&T will be
further protected by the continuing management and operation of
the Hotels by Shilo Management Corporation, thereby preserving the
value of its collateral, and post-petition replacement liens, the
Debtors say in their June 10 court filing.
The Debtors believe that the continued operations of the Hotels
provide adequate protection to CB&T and the other secured
creditors. Additionally, the Debtors propose to provide these
monthly adequate protection payments:
Shilo Inn, Boise Airport, LLC $15,458.38
Shilo Inn, Moses Lake Inc. $11,810.83
Shilo Inn, Nampa Blvd, LLC $5,217.20
Shilo Inn, Newberg, LLC $6,569.81
Shilo Inn, Rose Garden, LLC $5,975.11
Shilo Inn, Seaside East, LLC $7,729.12
Shilo Inn, Twin Falls, LLC $23,187.62
The Debtors say that if they aren't permitted to use cash
collateral to maintain and operate the Hotels, it is a virtual
certainty that these estates will be liquidated and immediately
depreciate in value. The Debtors will be unable to operate,
existing guests won't receive services and will depart, canceling
existing charges, and future reservations will also be canceled.
In an objection filed on June 17, 2014, CB&T says that it doesn't
consent to the use of its cash collateral to pay any attorneys'
fees and expenses of the Debtors.
For five of the Debtors, the proposed budget lists a $40,000
expense in July for administrative claims. For the other two
Debtors -- Boise and Nampa -- the proposed budget lists the same
expense as $0 for all months. The Debtors' counsel has
represented that this line item reflects anticipated payments of
their attorney's fees and costs. While the parties agree that any
attorneys' fees and costs can't be paid without a noticed fee
application and court approval, there remains a dispute over
whether the attorneys' fees and costs can be paid out of CB&T's
cash collateral and whether it is permissible for the fees to be
paid out of only five of the Debtors' estates, CB&T states.
The seven cases aren't substantively consolidated, and it isn't
permissible for CB&T's cash collateral held by certain Debtors to
be used to pay administrative claims which should be apportioned
to other Debtors' estates. According to CB&T, the administrative
burden of the fees must be borne by all seven of the Debtors'
estates, and not disproportionally by those which may have
sufficient cash collateral.
The Debtors responded to the objection on June 24, 2014, saying
that their court-approved employment application for their
bankruptcy counsel set forth that fees would be "billed
collectively and jointly" to all seven of the Debtors instead of
to the Debtors separately, and do not need to be evenly
apportioned amongst the Debtors.
CB&T is represented by:
Bryan Cave LLP
H. Mark Mersel, Esq.
Kerry Moynihan, Esq.
3161 Michelson Drive, Suite 1500
Irvine, California 92612-4414
Tel: (949) 223-7000
Fax: (949) 223-7100
E-mail: mark.mersel@bryancave.com
kerry.moynihan@bryancave.com
About Shilo Inn, Twin Falls
Shilo Inn, Twin Falls, LLC, and six affiliates filed a Chapter 11
petition (Bankr. C.D. Cal. Case No. 13-21601) on May 1, 2013.
Judge Richard M. Neiter presides over the case. Shilo Inn, Twin
Falls, estimated assets of at least $10 million and debts of at
least $1 million.
Shilo Inn, Twin Falls; Shilo Inn, Nampa Blvd, LLC; Shilo Inn,
Newberg, LLC; Shilo Inn, Seaside East, LLC, Shilo Inn, Moses Lake,
Inc.; and Shilo Inn, Rose Garden, LLC each operates and owns a
hotel. California Bank and Trust is the primary, senior secured
lender for each of the Debtors.
The Debtors sought Chapter 11 protection after CBT on May 1, 2013,
filed for receiverships in district court.
David B. Golubchick, Esq., Kurt Ramlo, Esq., and J.P. Fritz, Esq.,
at Levene, Neale, Bender, Yoo & Brill LLP, in Los Angeles,
represent the Debtors in their restructuring effort.
The Debtors' Joint Plan of Reorganization dated Aug. 29, 2013,
provides for payment of all claims in full, unless otherwise
agreed with the claimholder, with unsecured claims to be paid over
a three-month period from the Plan Effective Date.
SOURCE INTERLINK: Proposes Kirkland & Ellis as Counsel
------------------------------------------------------
Source Home Entertainment, LLC, et al., seek approval from the
bankruptcy court to employ Kirkland & Ellis LLP as their attorneys
nunc pro tunc to the Petition Date.
K&E's current hourly rates for matters related to the chapter 11
cases:
Billing Category U.S. Range
---------------- ----------
Partners $665 to $1,295
Of Counsel $415 to $1,195
Associates $450 to $865
Paraprofessionals $170 to $355
K&E represented the Debtors during the 12-month period before the
Petition Date, using the hourly rates listed.
On April 27, 2009, the Debtors paid $285,000 to K&E as a classic
retainer and have periodically made additional classic retainer
payments. As of the Petition Date, the Debtors' classic retainer
balance with K&E is $385,000.
The Debtors have approved K&E's prospective budget and staffing
plan for the period from the Petition Date to Sept. 30, 2014.
David L. Eaton, a partner at the firm, attests that K&E is a
"disinterested person" within the meaning of Section 101(14) of
the Bankruptcy Code, as required by Section 327(a) of the
Bankruptcy Code.
About Source Home Entertainment
and Source Interlink
Headquartered in Bonita Springs, Florida, Source Home
Entertainment, LLC, manufactures front-end retail checkout
displays and is a leading distributor of books, periodicals, and
other printed material. Its distribution network spans over
32,500 retail locations in the U.S. and abroad.
In the twelve months ended April 30, 2014, Source Home generated
revenues totaling approximately $600 million on a consolidated
basis. As of March 31, 2014, Source Home had assets (not
including goodwill or intangibles) of $205 million and liabilities
of approximately $290 million.
Source Home, Source Interlink Manufacturing, LLC, and other
affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case
No. 14-11553) on June 23, 2014, to sell their front-end retail
display fixtures business to lenders, absent higher and better
offers. The Debtors are winding down their books distribution
business.
The Debtors have tapped Kirkland & Ellis LLP as general bankruptcy
and corporate counsel; Young Conaway Stargatt & Taylor, LLP, as
co-counsel, FTI Consulting, Inc., as crisis and turnaround
advisor; and Kurtzman Carson Consultants, LLC, as claims agent.
The Debtors are seeking joint administration of their Chapter 11
cases.
STERLING BLUFF: Hearing on Plan Filing Extension Set For July 14
----------------------------------------------------------------
A hearing to consider Sterling Bluff Investors, LLC's motion to
extend its exclusive periods to file a plan and solicit
acceptances of that plan is set for July 14, 2014, at 10:00 a.m.
As reported by the Troubled Company Reporter on June 11, 2014, the
Debtor asks the U.S. Bankruptcy Court for the Southern District of
Georgia to extend its exclusive periods to file a Chapter 11 plan
until Oct. 1, 2014, and solicit acceptances of that plan until
Dec. 1, 2014. The Debtor tells the U.S. Bankruptcy Court for the
Southern District of Georgia that the extension of time is
essential to permit it to propose a plan of reorganization which
will provide for payment in full of all allowed claims.
Ford Plantation Club Objects
On June 16, 2014, The Ford Plantation Club, Inc. -- a Richmond
Hill, Georgia-based private sporting club and residential
community originally developed by The Ford Plantation, LLC --
objected to the Debtor's motion for exclusive period extension,
saying that the case is not complex and that it has failed to make
any good faith progress in proposing a plan or negotiating with
its creditors, although the case has been pending for over 130
days.
According to the Club, the Debtor's statement of financial affairs
indicates that during the first few months of 2014, the Debtor has
had zero income during the first few months of 2014, and that in
2013, the Debtor had only $3,000 in income. Two separate
appraisals (one of which was done at the request of the Debtor)
have valued the Debtor's lots and associated memberships at
substantially less than the secured claims.
The Club says that the Debtor has no employees, has made no
improvements to certain unsold residential lots in the development
known as The Ford Plantation that it acquired from he Ford
Plantation, LLC, in 2008, and has taken out no insurance because
it holds only raw land. The Debtor has no equity in any property
that it claims as an asset, the Club adds.
The Club and the Debtors are parties to a certain June 4, 2008
turnover agreement which obligated the Debtor to make certain
regular payments to the Club. Unable to satisfy its obligations
under the agreement, the Debtor requested in 2012 that the parties
adjust the payment schedule for the anniversary payments. The
Club, the Debtor, and certain other parties then executed that
certain Oct. 19, 2012 amendment to Turnover Agreement. Pursuant
to the Turnover Agreement, the Debtor owes the Club not less than
$2.24 million in unpaid anniversary payments and shortfall
payments. The Debtor has pledged its interests in certain of the
memberships and certain real estate to the Club as security for
the Debtor's obligations under the Turnover Agreement.
Coastal Bank Files Joinder to Objection
The Coastal Bank filed on June 17, 2014, a joinder to the Club's
objection. TCB holds an at least $5 million claim secured in part
by the Debtor's interest in certain lots and Club memberships.
The Debtor defaulted on its obligations to TCB, which initiated a
non-judicial foreclosure in January 2014. The foreclosure sale
scheduled for Feb. 4, 2014, precipitated the Debtor's bankruptcy
filing. TCB filed on Feb. 7, 2014, a motion for dismissal of the
Debtor's case, or in the alternative, relief from automatic stay.
The Club is represented by:
KING & SPALDING LLP
Jeffrey R. Dutson, Esq.
Jesse H. Austin, III, Esq.
1180 Peachtree Street
Atlanta, Georgia 30309-3521
Tel: (404) 572-4600
Fax: (404) 572-5131
E-mail: jaustin@kslaw.com
jdutson@kslaw.com
and
MCCALLAR LAW FIRM
C. James McCallar, Jr., Esq.
Tiffany E. Caron, Esq.
115 West Oglethorpe Avenue
P.O. Box 9026
Savannah, GA 31412
Tel: (912) 234-1215
Fax: (912) 236-7549
E-mail: mccallar@mccallarlawfirm.com
TCB is represented by:
Kathleen Horne, Esq.
Bouhan Falligant LLP
P.O. Box 2139
Savannah, GA 31402
Tel: (912) 232-7000
E-mail: khorne@bouhan.com
About Sterling Bluff Investors
Sterling Bluff Investors, LLC, a Georgia limited liability company
formed for the purpose of acquiring and owning lots in a
subdivision known as the Ford Plantation, Bryan County, Georgia,
and also certain club memberships in the Ford Plantation Club,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Ga. Case No. 14-40200) in Savannah, Georgia, on Feb. 3, 2014.
Stone & Baxter, LLP, in Macon, Georgia, represents the Debtor in
this Chapter 11 case.
The Debtor estimated assets and debt of $10 million to $50
million. The petition was signed by Michael Greene, manager.
The U.S. Trustee has not appointed an official committee of
unsecured creditors. The U.S. Trustee reserves the right to
appoint such a committee should interest developed among the
creditors.
SUPREME LLC: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Supreme, LLC, a New Mexico limited liability company
c/o The Elberta Honstein Trust
dated Nov 9, 1994, as amended
1302 N. McCurdy Road
Espanola, NM 87532
Case No.: 14-11952
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
New Mexico (Albuquerque)
Judge: Hon. David T. Thuma
Debtor's Counsel: Chris W Pierce, Esq.
HUNT & DAVIS, P.C.
2632 Mesilla St. NE
Albuquerque, NM 87110
Tel: 505-881-3191
Fax: 505-881-4255
Email: chris@huntdavislaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Elberta Honstein, Trustee of the Trust
which is the Member.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
SUSQUEHANNA BANCSHARES: Moody's Puts '(P)Ba2' Rating on Review
--------------------------------------------------------------
Moody's Investors Service placed the long-term ratings of
Susquehanna Bancshares, Inc. and its lead bank subsidiary,
Susquehanna Bank on review for upgrade. Susquehanna Bancshares is
rated Baa3 for senior debt. Susquehanna Bank has a long-term bank
deposit rating of Baa2 and a standalone bank financial strength
rating of C-, mapping to a standalone baseline credit assessment
of baa2. The Prime-2 short-term rating and the C- standalone bank
financial strength rating of Susquehanna Bank were affirmed and
are not on review.
On Review for Upgrade:
Issuer: Susquehanna Bancshares, Inc.
Preferred Shelf, Placed on Review for Upgrade, currently (P)Ba2
Non-Cumulative Preferred Shelf, Placed on Review for Upgrade,
currently (P)Ba3
Subordinate Shelf, Placed on Review for Upgrade, currently
(P)Ba1
Senior Unsecured Shelf, Placed on Review for Upgrade, currently
(P)Baa3
Senior Unsecured Regular Bond/Debenture, on Review for Upgrade,
currently Baa3
Issuer: Susquehanna Bank
Issuer Rating, Placed on Review for Upgrade, currently Baa2
OSO Senior Unsecured OSO Rating, Placed on Review for Upgrade,
currently Baa2
Senior Unsecured Deposit Rating, Placed on Review for Upgrade,
currently Baa2
Issuer: Susquehanna Capital I
Pref. Stock Preferred Stock, Placed on Review for Upgrade,
currently Ba2 (hyb)
Issuer: Susquehanna Capital II
Pref. Stock Preferred Stock, Placed on Review for Upgrade,
currently Ba2 (hyb)
Outlook Actions:
Issuer: Susquehanna Bancshares, Inc.
Outlook, Changed To Rating Under Review From Positive
Issuer: Susquehanna Bank
Outlook, Changed To Rating Under Review From Positive(m)
Issuer: Susquehanna Capital I
Outlook, Changed To Rating Under Review From Positive
Issuer: Susquehanna Capital II
Outlook, Changed To Rating Under Review From Positive
Affirmations:
Issuer: Susquehanna Bank
Bank Financial Strength Rating, Affirmed C-
OSO Rating, Affirmed P-2
Deposit Rating, Affirmed P-2
Ratings Rationale
Moody's said that Susquehanna's credit performance, specifically
its asset quality indicators, has been better than expected. Its
strong long-term performance demonstrates its consistent risk
discipline, particularly in the face of its sizable commercial
real estate (CRE) concentration, which management has reduced
noticeably. At its peak, CRE was 4.5 times its tangible common
equity at 30 September 2009, compared to its current 2.4 times.
Although this credit record was supported by a more favorable
local real estate market, it was also a product of prudent
underwriting and credit management, said Moody's.
Susquehanna -- like the US banking industry -- is facing earnings
pressures because its net interest margin is contracting from low
short-term interest rates, encouraging loan growth. Given this
backdrop, Moody's said that the review will focus on management's
ability to maintain its credit discipline and its underwriting
standards as opposed to reaching for loan growth to provide a
near-term offset to earnings stresses. Areas of special focus will
be the commercial and industrial lending, CRE, and auto financing
portfolios. The review will also focus on Susquehanna's capital
and funding plans.
TEMPLAR ENERGY: 2nd Lien Loan Upsize No Impact on Moody's B3 CFR
----------------------------------------------------------------
Moody's Investors Service said that Templar Energy, LLC's proposed
$200 million upsizing of its $700 million second lien term loan
through the exercising of its accordion feature does not impact
its B3 rating, its B2 Corporate Family rating (CFR), B2-PD
Probability of Default Rating (PDR) or stable outlook.
The term loan will be an add on under the company's existing
Second Lien Credit Agreement dated November 25, 2013 and will be
part of the same Credit Agreement. Proceeds of the term loan
offering will be used to repay outstandings under Templar's $375
million secured borrowing base revolving credit facility, for
acquisition financing and other corporate purposes. The term loan
is secured on a second priority basis by a lien on substantially
all of Templar's and its subsidiaries' tangible and intangible
assets. The second lien term loan is rated one-notch below the B2
CFR due to the prior ranking revolver in the capital structure, in
accordance with Moody's Loss Given Default methodology. Moody's
expects that the company will finance its growth on a relatively
balanced basis between first lien and second lien debt.
"Moody's views this add on debt offering largely as an exercise in
bolstering Templar's liquidity," commented Andrew Brooks, Moody's
Vice President. "However, Moody's recognizes that Templar's
decision to upsize its term loan is partially in response to
slower than expected production growth and cash flow generated by
the Anadarko Basin assets acquired from Forest Oil Corporation in
November 2013, although the underperformance is not to the extent
that warrants a negative rating action."
Templar Energy, LLC
Senior Secured 2nd Lien Term Loan rated B3, 65-LGD4
Ratings Rationale
Templar's B2 CFR reflects its relatively modest size, its limited
operating history and debt leverage approximating $50,000 per
flowing barrel of oil equivalent (Boe) over the first half of
2014. While privately owned Templar as an operating entity was
only established in December 2012, the acquired Anadarko Basin
assets which comprise the bulk of the newly formed company, have
been de-risked by Forest Oil and have producing lives which
stretch back many decades. Moreover, Templar management is well
seasoned in the technical and operating characteristics of the
Anadarko Basin in which it has operated a series of E&P companies
over the past two decades.
In October 2013, Templar agreed to acquire Forest's Anadarko Basin
assets for $1.0 billion, comprised of approximately 100,000 net
leasehold acres in the Texas/Oklahoma Panhandle, an estimated 113
million Boe of proved reserves and 17,000 Boe per day of
production. The Anadarko Basin is characterized by multiple
stacked pay zones with 18 reservoirs producing a balanced mix of
liquids rich gas and crude oil. Pro forma for the acquisition,
Templar's production approximates 45% natural gas and 55% liquids.
At closing, company founder and CEO Mr. David Le Norman acquired a
12.5% working interest in the Anadarko Basin assets for $125
million, which he financed and will hold through his wholly owned
Le Norman Fund I, LLC.
Lower than expected production starting up in 2014's first quarter
leading to elevated relative leverage metrics appears to be timing
related and not a function of the quality of the acquired Anadarko
Basin assets. As Templar ramps up its rig count and further
optimizes its drilling schedule over the remainder of 2014,
Moody's expects to see production and cash flow register
commensurate gains, and leverage dropping into the mid-$30,000
area per Boe of production entering 2015, albeit on a lagging
basis.
The outlook is stable based on the relatively low risk nature of
the acquired assets and Moody's view that relative debt leverage,
while high at the outset, will ratchet down as production gains
are realized. A rating downgrade would be considered should
Templar's debt leverage remain consistently at or above $50,000
per Boe of average daily production. A rating upgrade could be
considered should production levels reach 50,000 Boe per day with
debt on production falling below $35,000 per Boe.
The principal methodology used in this rating/analysis was the
Global Independent Exploration and Production Industry Methodology
published in December 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.
Templar Energy, LLC is a privately owned independent E&P company
headquartered in Oklahoma City, Oklahoma.
TERRAFORM POWER: Moody's Assigns 'Ba3' Corporate Family Rating
--------------------------------------------------------------
Moody's Investors Service assigned a Ba3 corporate family rating
(CFR) to TerraForm Power Operating LLC (TPO), a subsidiary of
TerraForm Power Inc (TPI). Concurrently, Moody's also assigned a
Ba3 rating to TPO's proposed senior secured facilities, comprising
of a $300 million term loan B and a $125 million revolving credit
facility. Additionally, Moody's assigned a Ba3-PD Probability of
Default Rating as well as a SGL-2 speculative grade liquidity
rating. This is the first time Moody's is rating TPO and the first
rating of a YieldCo. The rating outlook is stable.
Assignments:
Issuer: TerraForm Power Operating LLC
Probability of Default Rating, Assigned Ba3-PD
Speculative Grade Liquidity Rating, Assigned SGL-2
Corporate Family Rating, Assigned Ba3
Senior Secured Bank Credit Facility, Assigned Ba3
Senior Secured Bank Credit Facility, Assigned Ba3
Senior Secured Bank Credit Facility, Assigned a range of
LGD4, 50 %
Senior Secured Bank Credit Facility, Assigned a range of
LGD4, 50 %
Ratings Rationale
TPI, which is fully owned by SunEdison Inc (SunEd), a prominent
developer of utility scale and rooftop solar projects worldwide,
is expected to go public shortly. Completion of the IPO will be a
condition precedent to drawing down the term loan. SunEd is
expected to own 100% of the Class B units with Incentive
Distribution Rights (IDRs) after the IPO. TPI targets distributing
about 85% of cash available.
"The Ba3 rating on TPO is underpinned chiefly by our expectations
for stable distributions arising from a low business risk asset
portfolio and an attractive industry environment for solar
projects" said Swami Venkataraman, Moody's Vice President and
Senior Credit Officer. "The rating is constrained by the
significantly weaker credit quality of the sponsor SunEd, leverage
of about 6x consolidated Debt/EBITDA, as well as the lack of an
operating track record combined with a YieldCo business model that
has a number of credit-negative attributes -- high distribution
payouts and expected payout growth, financing risk, acquisition
event risk and potential corporate governance conflicts"
TPO will have a diverse initial portfolio that will consist of
808.2 MW of utility scale (83%) and distributed generation solar
projects (17%) spread across 23 different portfolios located in
four countries -- US, Canada, UK and Chile. All projects enjoy
long-term contracts with creditworthy counterparties, with a
weighted average remaining PPA life in the portfolio of about 20
years with less than 5% of expected cash flows coming from non-
investment grade or unrated counterparties. TPO is largely immune
to commodity price risk given the fixed tariffs while volume risks
have been addressed by evaluating TPO on a 1-year P90 solar
resource basis. Also, about 46% of expected distributions to TPO
will come from projects that are unlevered. However, Moody's do
anticipate TPO to be subject to a meaningful level of structural
subordination as additional assets are dropped into the yieldco.
Market conditions are currently favorable for the continued growth
of renewable energy, especially solar power. At the same time, the
rating reflects concerns that YieldCos are an, as yet, unproven
business model over the longer run with respect to their ability
to sustain dividend growth through acquisitions and project
development. SunEd has a pipeline of over 3.6 GW of solar
projects, including 1.1 GW of projects that TPI has a call right
to purchase. Over the next two years SunEd has an obligation to
contribute projects that provide at least $175 million of CAFD to
TPI. TPI also has a 6-year right of first offer on other projects
that SunEd develops in the U.S., Canada, U.K. and Chile. TPO's
board will have three independent directors responsible for
approving transactions with the sponsor and to manage any
conflicts of interest.
SunEd is arguably well positioned to be TPO's sponsor as a leading
developer of solar projects with substantial experience in
operating these plants as well. The company is also a producer of
high quality solar panels. However, SunEd's credit quality is
significantly weaker than TPO given its presence in low margin
semiconductor manufacturing businesses.
Parent level coverage at TPO is expected to be strong with DSCR of
4.9x in 2015 based on the initial portfolio of projects. However,
excess parent level cash is expected to be distributed as a
reoccurring dividend in line with the YieldCo business model.
Moody's analysis has primarily focused on consolidated financial
ratios, with leverage at 6.1x Debt/EBITDA based on expected 2015
earnings of the initial portfolio of projects. Assuming a static
portfolio and a 1-year P90 solar resource scenario, TPO's
Debt/EBITDA and EBITDA /interest coverage remain mostly flat over
the next three years at about 6x and 2.5x, respectively.
Distribution coverage is expected to be in the 100-120% range.
Ratios will improve if TPO is successful in executing on its
growth plans. If such growth is funded as currently contemplated,
consolidated Debt/EBITDA could fall towards 5x over the next three
years. However, Moody's have assessed TPO's growth plans
conservatively given the lack of a track record in operating as a
YieldCo as well as in the evolution of TPO's financial policies.
TPO can borrow additional term loans subject to a proforma
incurrence test at the parent of 4.5x Debt/CFADS. Maintenance
covenants are at 5.0x Debt/CFADS and 1.75x CFADS/interest.
Liquidity
The SGL-2 speculative grade liquidity rating incorporates Moody's
expectations for adequate liquidity for the next 12 months. Upon
financial close of the secured facilities, TPO is expected to have
about $80 million in unrestricted cash on hand plus access to the
$125 million revolver. Solar projects require little working
capital and their maintenance capex needs are already incorporated
into their respective O&M agreements with SunEd or third party
providers. Projects with debt also carry debt service and
operating reserves as required under their financing documents.
TPO's need for liquidity in its ongoing operations is mainly
limited to distributions and its own debt service that will
largely be covered through stable distributions from its operating
projects. Moody's expect TPO to utilize its cash balances and
working capital facility mainly during new project acquisitions,
although some utilization to tide over seasonal cash flow
variations is possible, since solar projects can generate very
little cash flow during the fall and winter months.
Outlook
The outlook is stable reflecting the strong offtaker credit
quality, low construction risks for solar projects and
expectations for stable operating performance at the various
projects.
What could change the rating UP
TPO's financial profile will improve if it is successful in
executing its growth plans. However, in light of the substantial
involvement of SunEdison as sponsor and operator, the unproven
nature of the yieldco business model and the lack of a track
record of prudent financial policies, limited prospects exist for
TPO to be upgraded.
What could change the rating DOWN
Moody's would lower the rating in the event that either higher
debt levels or poorer operating performance point to a rising
trend in the Debt/EBITDA leverage ratio rather than a falling
trend that is currently anticipated. Other factors that could
affect the rating include a decline in the quality of cash flows
through shorter contracts, commodity price exposure, lower rated
counterparties or risky regulatory jurisdictions. Deterioration in
the credit quality of the sponsor could be another factor in a
rating downgrade at TPO.
The methodologies used in this rating were Unregulated Utilities
and Power Companies published in August 2009 and Power Generation
Projects published in December 2012. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.
TRANS-LUX CORP: Carlisle Buys $1-Mil. Worth of Common Shares
------------------------------------------------------------
Trans-Lux Corporation entered into a Securities Purchase Agreement
with Carlisle Investments Inc., pursuant to which Carlisle
purchased 166,666 shares of the Company's Common Stock for a
purchase price of $1,000,000. Mr. Marco Elser, a director of the
Company, exercises voting and dispositive power as investment
manager of Carlisle. The transactions executed pursuant to the
Carlisle SPA consisted of a "Conversion Transaction", as such term
is defined in that certain Amended and Restated Promissory Note
dated as of May 29, 2014 and executed in favor of Carlisle. The
Carlisle SPA terminated the Carlisle Note in its entirety, and
also terminated that certain Security Agreement between the
Company and Carlisle and the liens granted therein, which such
agreement was entered into in connection with the Carlisle Note.
On June 20, 2014, the Company entered into a Securities Purchase
Agreement with George Schiele, pursuant to which Schiele purchased
33,333 shares of the Company's Common Stock for a purchase price
of $200,000. Schiele is the Chairman of the Board of Directors
of the Company. The transactions executed pursuant to the Schiele
SPA consisted of a "Conversion Transaction", as that term is
defined in that certain Promissory Note dated June 4, 2014, and
executed in favor of Schiele. The Schiele SPA terminated the
Schiele Note in its entirety.
Trans-Lux Corporation issued 50,000 shares of the Company's common
stock, par value $.001 per share, to David Pavlik, president of
Trans-Lux Energy Corporation, a subsidiary of the Company. The
Pavlik Issuance was made pursuant to the terms of that certain
Restricted Stock Agreement dated as of May 27, 2014.
About Trans-Lux Corporation
Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a
designer and manufacturer of digital signage display solutions for
the financial, sports and entertainment, gaming and leasing
markets.
Trans-Lux Corporation reported a net loss of $1.86 million on
$20.90 million of total revenues for the year ended Dec. 31, 2013,
as compared with a net loss of $1.36 million on $23.02 million of
total revenues in 2012.
As of March 31, 2014, the Company had $18.48 million in total
assets, $17.24 million in total liabilities and $1.23 million in
total stockholders' equity.
BDO USA, LLP, in Melville, NY, 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 losses from operations and has
a significant working capital deficiency that raise substantial
doubt about its ability to continue as a going concern. Further,
the Company is in default of the indenture agreements governing
its outstanding 9 1/2 Subordinated debentures which was due in
2012 and its 8 1/4 percent Limited convertible senior subordinated
notes which was due in 2012 so that the trustees or holders of 25
percent of the outstanding Debentures and Notes have the right to
demand payment immediately. Additionally, the Company has a
significant amount due to their pension plan over the next 12
months.
TRUE DRINKS: Incurs $3.6-Mil. Net Loss in March 31 Quarter
----------------------------------------------------------
True Drinks Holdings, Inc., filed its quarterly report on Form 10-
Q, disclosing a net loss of $3.6 million on $650,532 of net sales
for the three months ended March 31, 2014, compared with a net
loss of $1.56 million on $410,801 of net sales for the same period
in 2013.
The Company's balance sheet at March 31, 2014, showed
$9.99 million in total assets, $6.99 million in total liabilities,
and stockholders' equity of $3 million.
The Company's auditors has included a paragraph in their report on
the Company's consolidated financial statements, included in its
Annual Report on Form 10-K for the fiscal year ended Dec. 31,
2013, indicating that there is substantial doubt as to the ability
of the Company to continue as a going concern. As of and for the
quarter ended March 31, 2014, the Company has negative working
capital of $1.96 million and an accumulated deficit of $13.84
million. While subsequent to Dec. 31, 2013, the Company raised
approximately $1.86 million resulting from the sale of shares of
its Series B Convertible Preferred Stock ("Series B Preferred"),
additional capital may be necessary to advance the marketability
of the Company's products to the point at which the Company can
sustain operations. Management's plans are to continue to contain
expenses, expand distribution and sales of its AquaBall(TM)
Naturally Flavored Water as rapidly as economically possible, and,
if necessary, raise capital through equity and debt offerings in
the event additional capital is necessary to execute the Company's
business, marketing and operating plan, and achieve profitability
from continuing operations.
A copy of the Form 10-Q is available:
http://is.gd/4kL3it
True Drinks Holdings, Inc. manufactures and markets beverages and
health snack products. The company produces vitamin-enhanced water
drinks. The company was formerly known as True Drinks, Inc. and
changed its name to True Drinks Holdings, Inc. in October 2012.
The company was founded in 2008 and is based in Irvine,
California.
VALIDUS HOLDINGS: Moody's Affirms '(P)Ba1' Preferred Stock Rating
-----------------------------------------------------------------
Moody's Investors Service has affirmed the ratings of Magnum
Hunter, Ltd. (senior debt Baa2; NYSE: VR) and its principal
operating subsidiary Validus Reinsurance, Ltd. (insurance
financial strength A3) after the company announced it had agreed
to acquire Western World Insurance Group, Inc., a small excess and
surplus lines property-casualty insurance company based in New
Jersey, United States. The rating outlook remains positive.
Validus will pay $690.0 million in cash, out of existing funds, in
exchange for 100% of the outstanding stock of Western World.
Western World's March 31, 2014 GAAP book value is $431.3 million
and the adjusted GAAP book value is estimated to be $518.3
million, including a redundant reserve release of $149 million
pre-tax. The transaction is expected to close on or about the end
of the third quarter of 2014, subject regulatory approvals.
Ratings Rationale
"The rating affirmation reflects three main factors," said Kevin
Lee, analyst for Validus Holdings. First, Moody's believes that
Validus, irrespective of this acquisition, remains relatively well
positioned to cope with the current, significant challenges in the
reinsurance industry. Second, Moody's views Western World as a
company with a mix of credit strengths and challenges; the company
has a good track record in its core general liability product and
contract binding division, but less success in other product lines
and unproven track record in newer initiatives. Third, Moody's
believes the acquisition could potentially yield revenue synergies
and a way for Validus to diversify further away from reinsurance,
a credit positive, but there is material uncertainty of realizing
those benefits on a meaningful scale.
Credit Profile of Validus: Validus is one of a select number of
reinsurance companies that has turned a profit in each year since
2006 -- a key argument for changing the rating outlook to positive
(from stable) in September 2013. Although conditions in the
reinsurance sector have deteriorated since last September, Moody's
believes Validus has a reasonable chance to emerge from these
challenges in the top tier of an increasingly two-tier market,
given its ability to provide significant capacity and value-added
services to remain relevant with buyers and intermediaries.
Credit Profile of Western World: Moody's views Western World as a
weaker credit than Validus. Western World is a small, US excess
and surplus lines insurer that writes property-casualty insurance
for small and medium-sized businesses. Among its credit strengths
are a 50-year track record, over 20 consecutive years of reserve
releases, and respectable underwriting results in its core general
liability product line, which makes up 59% of 2013 direct premiums
written (DPW). However, other product lines have performed poorly,
and newer initiatives are unproven. For example, reserve adequacy
for the newer Specialty Brokerage Division (14% of 2013 DPW) is
inherently more uncertain due to limited historical data, a risk
factor mentioned in the Statement of Actuarial Opinion.
Credit Profile of Combined Entities: On balance, Moody's views the
acquisition as credit neutral for Validus. The acquisition is
small enough that Western World's aforementioned credit challenges
should not overwhelm Validus' credit profile. The new platform
could help Validus diversify further away from reinsurance, a
credit positive, but execution risk is meaningful. Potential
benefits include a broader distribution platform for Validus'
direct insurance products (currently sold through its Lloyd's
syndicate Talbot), more options for cycle management, and more
casualty product knowledge that could help Validus' reinsurance
platform in the future. However, realization of these benefits
hinges on how receptive Western World's distribution partners will
be to new product offerings or pruning of unprofitable products --
a significant uncertainty. Succession planning is also a key
issue.
Moody's A3 insurance financial strength rating for Validus
Reinsurance, Ltd. reflects its status as one of the largest
catastrophe reinsurers in Bermuda, profitable track record, good
capital adequacy and profitable diversification from its Talbot
Lloyd's franchise. These strengths are tempered by the inherent
volatility of the catastrophe reinsurance business, relatively
short time in existence (began operations in 2006), difficult-to-
quantify exposures in certain classes of business, and an appetite
for acquisitions that has led to successful mergers but has also
made it difficult to pinpoint the direction of the company.
Moody's Baa2 senior debt rating for the parent company is based on
its very manageable debt leverage and Moody's expectation of ample
credit support from the operations, subject to regulatory dividend
restrictions.
The reinsurance sector is currently facing significant direct and
indirect effects from non-traditional sources of capital, such as
pension funds, endowments, institutional investors, and high net-
worth individuals, that are pouring money into catastrophe risks
and effectively introducing a low-cost provider into the space.
The impact of this non-traditional capital will be an important
deciding factor on how the Validus' rating outlook will be
resolved.
The following factors could lead to an upgrade of Validus'
ratings: (1) ability to maintain risk-adjusted profitability in
aggregate; (2) adjusted debt-to-total capital ratio below 15%
cross-cycle; (3) EBIT coverage of fixed charges above 8x cross-
cycle; (4) capital adequacy ratios, including net catastrophe
leverage, remain at current levels; (5) successful integration of
Western World. Failure to achieve to these factors would likely
return the outlook to stable.
The following ratings have been affirmed with a positive outlook:
Validus Reinsurance, Ltd. -- insurance financial strength at A3;
Validus Holdings, Ltd. -- senior unsecured debt at Baa2, long-term
issuer rating at Baa2, provisional senior unsecured debt at
(P)Baa2, provisional subordinated debt at (P)Baa3, provisional
preferred stock at (P)Ba1.
Validus Holdings, Ltd. is a global provider of reinsurance and
insurance. For full year 2013, the company reported gross premiums
written of $2.4 billion, net income available to common
shareholders of $533 million and total shareholders' equity
available to Validus of $3.7 billion as of December 31, 2013.
The principal methodology used in this rating was Moody's Global
Rating Methodology for Reinsurers published in December 2011.
VERMILLION INC: Declassifies Board of Directors
-----------------------------------------------
Vermillion, Inc., held its 2014 annual meeting of the stockholders
on June 19, 2014, at which the stockholders:
(1) adopted amendments to the Company's Certificate of
Incorporation and Bylaws to declassify the Company's board
of directors;
(2) elected James S. Burns and Carl Severinghaus as
Class II directors each to serve until his successor is
duly elected and qualified;
(3) approved on an advisory basis the compensation of the
Company's named executive officers; and
(4) ratified the Board's selection of BDO USA, LLP, as the
Company's independent registered public accounting firm for
the fiscal year ending Dec. 31, 2014.
About Vermillion
Vermillion, Inc., is dedicated to the discovery, development and
commercialization of novel high-value diagnostic tests that help
physicians diagnose, treat and improve outcomes for patients.
Vermillion, along with its prestigious scientific collaborators,
has diagnostic programs in oncology, hematology, cardiology and
women's health.
The Company filed for Chapter 11 on March 30, 2009 (Bankr. D. Del.
Case No. 09-11091). Vermillion's legal advisor in connection with
its successful reorganization efforts wass Paul, Hastings,
Janofsky & Walker LLP. Vermillion emerged from bankruptcy in
January 2010. The Plan called for the Company to pay all claims
in full and equity holders to retain control of the Company.
Vermillion incurred a net loss of $8.81 million in 2013, a net
loss of $7.14 million in 2012 and a net loss of $17.79 million in
2011. As of March 31, 2014, the Company had $27.27 million in
total assets, $4.34 million in total liabilities and $22.92
million in total stockholders' equity.
WAVE SYSTEMS: Seven Directors Re-Elected to Board
-------------------------------------------------
Wave Systems Corp. held its annual meeting of stockholders on
June 19, 2014, at which the stockhoders:
(1) re-elected John E. Bagalay Jr., Nolan Bushnell, Robert
Frankenberg, George Gilder, William Solms, Lorraine Hariton
and David Cote as directors to hold office until the next
Annual Meeting and until their successors are duly elected
and qualified;
(2) approved, on a non-binding advisory basis, the compensation
of the Company's named executive officers;
(3) approved the Amended and Restated 2004 Employee Stock
Purchase Plan; and
(4) ratified the selection of KPMG LLP as the Company's
independent registered public accounting firm for 2014.
On June 19, 2014, David Cote was appointed as vice chairman of the
Company's Board of Directors, effective immediately.
About Wave Systems
Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) --
http://www.wave.com/-- develops, produces and markets products
for hardware-based digital security, including security
applications and services that are complementary to and work with
the specifications of the Trusted Computing Group, an industry
standards organization comprised of computer and device
manufacturers, software vendors and other computing products
manufacturers.
Wave Systems reported a net loss of $20.32 million in 2013, a net
loss of $33.96 million in 2012 and a net loss of $10.79 million in
2011.
KPMG LLP, in Boston, Massachusetts, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2013. The independent auditors noted that
Wave Systems Corp. has suffered recurring losses from operations
and has an accumulated deficit that raise substantial doubt about
its ability to continue as a going concern.
YAMANA GOLD: S&P Assigns 'BB+' CCR & Revises Outlook to Positive
----------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB+'
long-term corporate credit rating and positive outlook to Toronto-
based gold producer Yamana Gold Inc.
At the same time, Standard & Poor's assigned its 'BB+' issue-level
rating and '3' recovery rating to the company's proposed US$500
million senior unsecured notes and US$1 billion senior unsecured
revolving credit facility. The '3' recovery rating indicates
S&P's expectation of meaningful (50%-70%) recovery in a default
scenario.
The ratings on Yamana reflect Standard & Poor's view of the
company's "fair" business risk profile and "intermediate"
financial risk profile, which result in an anchor score of 'bb+'.
S&P do not apply modifiers to the anchor score, resulting in a
'BB+' long-term corporate credit rating.
Yamana is a Canada-based gold company with a relatively low cost
production profile and mining operations based exclusively in the
Americas.
"We expect the company to generate steady production growth and
improved operating diversity from its recent 50% acquisition of
Osisko Mining Corp.," said Standard & Poor's credit analyst Donald
Marleau. "In our view, counterbalancing these supportive factors
somewhat are relatively short mine lives based on current reserves
at the majority of the company's operating assets; Yamana's
relatively narrow asset base compared to most senior gold
producers; and its exposure to unstable gold, copper, and silver
prices," Mr. Marleau added.
The positive outlook reflects S&P's expectation that a stronger
financial risk profile after acquiring the diversity-enhancing
Osisko could compel S&P to a one-notch upgrade on the company.
S&P believes that leverage below 2x that indicates a modest
financial risk profile supports the moderate improvement in
Yamana's business risk profile.
S&P could raise its rating on Yamana if the company generates
adjusted debt-to-EBITDA below 2x and improves funds from
operations-to-debt to the mid-40% area on a sustainable basis,
while maintaining at least a fair business risk profile.
S&P could revise its outlook on the company to stable if Yamana's
core leverage and cash flow credit metrics remain weak for more
than a year after the acquisition, indicating an inability to
reduce debt or weaker earnings.
ZACK GROUP: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: The Zack Group, Inc.
dba At Home HealthCare
dba At HomeCare by Zack Group
6335 W. 110th Street
Overland Park, KS 66207
Case No.: 14-21490
Nature of Business: Health Care
Chapter 11 Petition Date: June 25, 2014
Court: United States Bankruptcy Court
District of Kansas (Kansas City)
Judge: Hon. Dale L. Somers
Debtor's Counsel: Joanne B. Stutz, Esq.
EVANS & MULLINIX, P.A.
7225 Renner Road Ste 200
Shawnee, KS 66217
Tel: (913) 962-8700
Email: jstutz@emlawkc.com
Total Assets: $345,155
Total Liabilities: $1.28 million
The petition was signed by Ronald M. Zack, CEO & president.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/ksb14-21490.pdf
* Action by Argentina Seems to Defy Judge's Order on Bond Payments
------------------------------------------------------------------
Peter Eavis, writing for The New York Times' DealBook, reported
that Argentina made a puzzling and potentially provocative move on
Thursday in its landmark legal battle with New York hedge funds,
which are suing the country over bonds that it defaulted on over
10 years ago.
According to the report, Judge Thomas P. Griesa of the Federal
District Court in Manhattan has ruled that Argentina cannot make
payments to its main class of bondholders without also paying the
hedge funds what they say they are owed. But Argentina has
announced that it had deposited $539 million with the Bank of New
York Mellon, for the purpose of paying its main bondholders. A
payment is due on their bonds on June 30, the report noted.
* Puerto Rico Governor Files Debt Enforcement & Recovery Bill
-------------------------------------------------------------
The governor of Puerto Rico, Alejandro Garcia Padilla, along with
the president of the Board of Directors of the Government
Development Bank for Puerto Rico ("GDB"), David H. Chafey, and
Treasury Secretary, Melba Acosta Febo, announced on June 25 the
filing before the Legislature of a bill entitled: The Puerto Rico
Public Corporations Debt Enforcement and Recovery Act whose main
purpose is to provide a clear legislative framework for certain
public corporations that are experiencing severe financial stress
to overcome their financial obstacles through an orderly,
statutory process that allows them to handle their debts fairly
and equitably, while ensuring the continuity of essential services
to citizens and infrastructure upgrades.
"United States law provides a framework for the nation's companies
and municipal entities to address their financial challenges while
continuing their services. However, Puerto Rico's public
corporations fall through the cracks of these laws. Therefore,
the Recovery Act is created to provide a clear legislative
framework that allows public corporations to address their
financial difficulties without compromising any essential services
provided by these corporations. It is worth noting that this law
excludes the Commonwealth's debt and other entities explicitly
excluded," said David Chafey.
Officials explained that the Recovery Act provides a controlled,
orderly process through which a public corporation can become
financially self-sufficient in order to ensure its continued
ability to provide critical services to the people of Puerto Rico
over the longer term. The Recovery Act includes two paths to a
successful financial adjustment of a corporation's debts -- both
of which are designed to ensure fair and equitable treatment for
all stakeholders as well as a consistent level of service for
consumers.
Treasury Secretary, Melba Acosta, stated that Chapter 2 of the
Recovery Act specifically encourages the corporation and certain
financial creditors to reach an agreement in a consensual manner.
It is designed to get to a negotiated solution with minimum
disruption to the business within a defined period of time. If an
agreement is not reached, Chapter 3 of the Recovery Act provides
for a process that is overseen by a Commonwealth court located in
Puerto Rico.
"The main purpose of the law is to protect the interests of the
people of Puerto Rico and to ensure that the gap in federal law
does not jeopardize essential public services. The Recovery Act
also protects Puerto Rico's GO debt by giving public corporations
the opportunity to address their financial challenges once and for
all and thereby no longer depend on the General Fund. Also, the
law protects the interests of bondholders and creditors, along
with other stakeholders, by giving corporations a way to negotiate
with their primary stakeholders toensure afair and equitable
allocation of resources and createa more promising future for
their finances and for all the people who depend on them," they
added.
As explained in the legislation, not all public corporations will
be eligible for the Recovery Act. Among the governmental entities
specifically excluded are: the Commonwealth, the seventy-eight
municipalities of the Commonwealth, GDB and its subsidiaries,
affiliates, and ascribed entities, the Children's Trust, the
Employees Retirement System, the Judiciary Requirement System, the
Municipal Finance Agency, the Municipal Finance Corporation, the
Puerto Rico Industrial Development Company, the Puerto Rico
Industrial, Tourist, Educational, Medical and Environmental
Control Facilities Financing Authority, the Puerto Rico
Infrastructure Financing Authority, Puerto Rico Sales Tax
Financing Corporation, the Puerto Rico System of Annuities and
Pensions for Teachers, and the University of Puerto Rico.
"Over the past year, the GDB has reiterated that the public debt
of the Commonwealth should not be seen as a sum of debts to a
single debtor, but rather as individual loans supported by various
sources of revenues and income, with certain priorities
established by law or contract. Moreover, the GDB's message to
the market has been consistent in the sense that neither the
Commonwealth nor the GDB is in the position to subsidize or bail
out public corporations and that they need to become self-
sufficient."
"We will continue to support the efforts of public corporations to
become financially self-sufficient. However, taking into account
the current challenges, if public corporations defaulted on their
obligations in a way that would allow creditors to exercise their
remedies piecemeal or in a disorderly fashion, the absence of an
orderly process would threaten the Puerto Rico government's
capacity to safeguard the public and promote the general welfare
of the people. For these reasons, the Recovery Act is urgently
needed," said Mr. Chafey.
"Since January 2013, this Administration has implemented fast,
decisive and multiple unprecedented measures to stabilize the
fiscal situation of Puerto Rico, promote economic growth, and
safeguard and reinforce Puerto Rico's credit. We are close to
having a balanced budget for the fiscal year of 2014-2015, and we
have approved a comprehensive reform of the Retirement System of
the Employees Government and important measures to strengthen the
public corporations of Puerto Rico," the Governor said.
"This Administration continues to demonstrate that it is prepared
to make the difficult decisions that are needed to ensure the
long-term sustainability of the Government of Puerto Rico.
"The Recovery Act is not related to the Commonwealth's general
obligations to creditors. We will continue to honor our
obligations to the Commonwealth's creditors. We are focused on
assuring that Puerto Rico regains its economic growth, and we will
stand by this promise," the Governor concluded.
* American Stock Transfer Completes Purchase of Donlin Recano
-------------------------------------------------------------
Donlin, Recano & Company, Inc. on June 26 disclosed that American
Stock Transfer & Trust Company, LLC has completed its purchase of
Donlin Recano. The acquisition brings important new capabilities
to Donlin Recano and its clients.
"We plan to enhance Donlin Recano's existing brand strength
through continued support and investment," said Mark C. Healy, CEO
and President of AST. "We look forward to leveraging our
capabilities and technological advantages for the benefit of
Donlin Recano's clients."
"There is no better way to celebrate our 25th anniversary than
combining Donlin Recano with the power of AST. This combination
allows the Donlin Recano brand to further enhance the superior
customer experience our clients have come to expect," said
Donlin Recano's CEO Alexander Leventhal.
About AST
AST and its affiliates in the Link Group network are leading
providers of registry services and technology to financial market
participants around the globe. AST and its affiliate, CST Trust
Company (CST), form the North American division of the Link Group.
Together AST and CST provide comprehensive stock transfer and
employee plan services to more than 8,000 public issues and over
5.5 million shareholders.
The division serves clients located throughout North America and
in over 22 foreign countries, ranging in size from initial public
offerings to Fortune 100 companies.
About Donlin, Recano & Company, Inc.
Founded in 1989, Donlin, Recano & Company is the leading
bankruptcy administration company that has served over 200
national clients across a broad range of industries and business
sectors. Working with counsel, turnaround advisors and the
affected company, Donlin Recano helps organize and guide Chapter
11 clients through required bankruptcy tasks, including provision
of creditor notification, website-accessible information,
formation of professional call centers, management of claims,
balloting, distribution and other administrative services.
* Gordon Novod to Head Grant & Eisenhofer's Bankruptcy Practice
---------------------------------------------------------------
Leading financial litigation law firm Grant & Eisenhofer P.A.
announced that prominent creditor-side bankruptcy lawyer
Gordon Z. Novod has joined the firm to head its bankruptcy
litigation practice. Mr. Novod, who joins G&E's New York office
as a director, was previously a partner in the bankruptcy &
corporate restructuring practice of Brown Rudnick in New York. He
also formerly practiced in the corporate restructuring and
bankruptcy group of Kramer Levin Naftalis & Frankel.
With more than a decade of experience handling complex corporate
restructurings, Mr. Novod generally focuses on creditor-side
representations. He has advised official and adhoc committees,
distressed investors, trustees, trade creditors and other
stakeholders in a number of high-profile restructurings that span
the automotive, chemical energy, entertainment, manufacturing,
retail and other sectors.
Among his noteworthy engagements, Mr. Novod represented Wilmington
Trust Company as indenture trustee for the subordinated debentures
in the Tribune Company's historic bankruptcy. He also represented
unsecured creditors' committees in the General Motors, Herbst
Gaming, Bethlehem Steel, Lyondell Chemical and other major Chapter
11 cases, as well as ad hoc creditor groups in Lehman Brothers,
Central European Distribution Corp., Charter Communications and
WCI Steel.
Mr. Novod's arrival complements Grant & Eisenhofer's work
litigating on behalf of domestic and foreign institutional
investors in securities class actions, corporate governance
matters and derivative suits. In recent years, G&E has broadened
its practice to represent plaintiffs in national whistleblower
suits, consumer class actions and private antitrust litigation.
The firm has recovered more than $13 billion for plaintiffs in the
last five years.
G&E is currently representing the estate of bankrupt futures
broker Refco Inc. and its administrator Marc Kirschner in a
lawsuit against financial services firm Cantor Fitzgerald and
senior executives, including Chairman and CEO Howard Lutnick. The
estate alleges that Cantor failed to compensate Refco for its 10%
stake in core technology supporting Cantor's Nevada gaming
businesses. Earlier this month, a federal judge in New York's
Southern District upheld key claims against Cantor, allowing the
case to move forward.
G&E co-founders and managing directors Stuart Grant and
Jay Eisenhofer said of Mr. Novod's arrival: "Gordon brings an
outstanding track record in handling complex bankruptcy matters
and working with creditors and administrators of major
restructurings. His litigation success fits extremely well with
our ongoing work on behalf of investor plaintiffs, including our
role in some of the biggest bankruptcy cases of the last dozen
years such as Delphi, Parmalat, Global Crossing and other
companies."
Mr. Novod commented: "Representing creditors and investors in
large Chapter 11 proceedings is the cornerstone of my practice,
and I'm pleased to be joining Grant & Eisenhofer's stellar
litigation platform. The firm is well-known for its successful
representation of plaintiffs in investor lawsuits and other
complex business litigation, and I am looking forward to further
expansion of its existing bankruptcy business."
Mr. Novod received his undergraduate degree from Emory University,
and his J.D. from Benjamin N. Cardozo School of Law.
Other recent bankruptcy-related litigation handled by G&E includes
representation of funds managed by Franklin Advisors, Conseco
Capital Management, Credit Suisse Asset Management, Pilgrim
American Funds and Oppenheimer Funds in a securities action
against bankrupt beauty care product maker Styling Technology.
G&E also represents a group of institutional investors who
collectively purchased over $600 million of debt issued by
Washington Mutual Bank, in a securities fraud action and related
bankruptcy claim stemming from WaMu's dissolution.
G&E led litigation behind some of the largest investor recoveries
on record in securities cases, including serving as co-lead
counsel to investors in an epic class action against Tyco
International alleging accounting and other fraud that looted the
company under disgraced CEO Dennis Kozlowski. The resulting $3
billion settlement struck in 2007 represented the largest payment
ever made by a corporate defendant in resolving a securities class
action. A separate $225 million payment was made by Tyco's former
auditor PricewaterhouseCoopers, itself a near-record payment by an
accounting firm.
About Grant & Eisenhofer
Grant & Eisenhofer P.A. represents plaintiffs in a wide range of
complex financial litigation. G&E's clients include institutional
investors, whistleblowers and other stakeholders in bankruptcy
litigation, securities class actions, derivative lawsuits,
consumer class actions, antitrust suits, and cases involving the
False Claims Act. G&E has recovered more than $13 billion for
investors in the last five years and has consistently been cited
by RiskMetrics for securing the highest average investor recovery
in securities class actions. Grant & Eisenhofer has been named
one of the country's top plaintiffs' law firms by The National Law
Journal for the past ten years.
* Rosenthal, Duignan Join Otterbourg's Banking & Finance Practice
-----------------------------------------------------------------
Otterbourg P.C. on June 25 disclosed that Jeffrey Rosenthal and
Thomas Duignan joined the firm as members in the banking and
finance group. Mr. Rosenthal and Mr. Duignan will also coordinate
extensively with the firm's workout, distressed debt and
insolvency practice areas. Messrs. Rosenthal and Duignan work on
a wide range of matters and represent a broad cross section of
clients in the financial services industry. They come to
Otterbourg from Troutman Sanders LLP, where they were partners.
"Jeff and Tom have exceptional practices, and they will integrate
seamlessly into our firm," said Daniel Wallen, Otterbourg's
chairman. "We have known them for years, and we are very pleased
to bring them on board to strengthen our ability to do even more
work for our institutional clients by enhancing our already deep
bench of highly experienced banking and finance attorneys."
Mr. Rosenthal specializes in advising clients in the negotiation
and documentation of sophisticated loan transactions and workouts
of existing loans and debtor-in-possession loans. His clients
have included major commercial banks and many finance companies
active in the commercial finance industry in New York and New
Jersey. He has represented buyers of distressed debt in a number
of transactions and has frequently helped the buyer take control
of and turn around the borrower.
"Otterbourg is the premier firm in my practice area,"
Mr. Rosenthal said. "I have done work for a number of clients we
have in common, and joining them now provides me with an
exceptional opportunity to expand my practice and the services I
offer my clients."
Mr. Duignan focuses his practice on complex asset-based lending,
commercial lending, vendor and equipment financing, and on
representing buyers and sellers of financial assets. He has wide-
ranging experience with syndicated and single lender transactions,
multicurrency transactions, cross border transactions, letters of
credit, and intercreditor arrangements. His clients typically
include banks, finance companies and hedge funds.
"I have enjoyed working with many members of Otterbourg over the
years, and I am thrilled to team up with them," Mr. Duignan said.
"I think this is a perfect match that enhances both Jeff's
practice and my practice while also helping make Otterbourg
stronger than ever."
The addition of Messrs. Rosenthal and Duignan continues a string
of new members who have joined Otterbourg this year, including
John Hanley in the corporate group and Oleg Sabel in the real
estate group.
About Otterbourg P.C.
Otterbourg P.C. regularly represents clients in matters of
national and international scope, including institutional lenders
and creditors such as banks, asset-based lenders, hedge funds and
private equity firms. The firm's practice includes domestic and
cross-border financings, litigation and alternative dispute
resolutions, mergers and acquisitions and other corporate
transactions, real estate, restructuring and bankruptcy
proceedings, and trusts and estates.
* Vault.com Releases Law Practice Area Rankings for 2015
--------------------------------------------------------
Offering deeper insight into the legal industry, Vault.com
released its Law Practice Area Rankings for 2015, examining how
associates rate peer firms in areas such as bankruptcy law. Yet
again, Vault's survey respondents determined that Weil, Gotshal &
Manges -- an "impressive" "heavyweight" "known for its good
reputation" and considered a "bankruptcy thought leader" -- boasts
the most prestigious bankruptcy and restructuring group in the
U.S.
It was the sixth straight year at the top for Weil Gotshal with
perennial favorites Kirkland & Ellis and Skadden, Arps, Slate,
Meagher & Flom following at No. 2 and No. 3, respectively.
Vault's Law Editor Nicole Weber explained, "Weil leads the top-
ranked pack by a wide margin. The firm's Business & Restructuring
Group has played prominent roles in the largest insolvencies in
history including Lehman Brothers, AIG, General Motors and
Washington Mutual, and it's going to continue leading the field."
"In order to choose the right firm, law students must start
thinking about their preferred practice areas early on," said
Ms. Weber. "Candidates apply for summer associate positions after
just one year of school, and understanding the firms that are
strongest in each specialty is a crucial component of the
process."
In order to determine the Vault Practice Area Rankings, nearly
17,000 associates were asked to vote for up to three firms they
consider strongest in their own practice area, but associates were
not permitted to vote for their own firm. Vault's rankings
feature the firms that received the highest percentage of votes
from survey respondents.
The Top 10 Law Firms for Bankruptcy are:
* Weil, Gotshal & Manges
* Kirkland & Ellis
* Skadden, Arps, Slate, Meagher & Flom
* Jones Day
* Akin Gump Strauss Hauer & Feld
* Milbank, Tweed, Hadley & McCloy
* Davis Polk & Wardwell
* Pachulski Stang Ziehl & Jones
* Paul, Weiss, Rifkind, Wharton & Garrison
* Latham & Watkins
Outside of the Top 10, King & Spalding and Greenberg Traurig
ranked in the bankruptcy category this year, sharing the No. 14
spot with Cleary Gottlieb Steen & Hamilton and Quinn Emanuel
Urquhart & Sullivan. Greenberg Traurig has not ranked in this
category since 2010 and King & Spalding is a newcomer. White &
Case made a strong return to the Top 15, landing at No. 11.
Strong moves were matched by one noticeable drop?Cadwalader,
Wickersham & Taft fell out of the rankings this year.
View the entire Vault Law Practice Area Rankings at:
http://is.gd/RZAtvd
About Vault
Vault is the most comprehensive resource for employer, university
and internship program rankings, ratings and insight. Vault's
influential rankings and reviews are sourced from directed surveys
of professionals and students, and evaluate companies, schools and
internships in terms of prestige, best place to work, diversity,
quality of life, compensation and other categories. Vault
provides users with in-depth information on employers, industries,
interviews, and available jobs and internships. In addition,
Vault partners with employers to help build their brands and
assist with recruiting efforts, and with universities to help
their students with employment placement and career selection.
* BOOK REVIEW: The First Junk Bond: A Story of Corporate Boom
and Bust
-------------------------------------------------------------
Author: Harlan D. Platt
Publisher: Beard Books
Softcover: 236 pages
List Price: $34.95
Review by Gail Owens Hoelscher
Order your personal copy today and one for a colleague at
http://www.beardbooks.com/beardbooks/the_first_junk_bond.html
Only one in ten failed businesses is equal to the task of
reorganizing itself and satisfying its prior debts in some
fashion. This engrossing book follows the extraordinary journey
of Texas International, Inc (known by its New York Stock
Exchange stock symbol, TEI), through its corporate growth and
decline, debt exchange offers, and corporate renaissance as
Phoenix Resource Companies, Inc. As Harlan Platt puts it, TEI
"flourished for a brief luminous moment but then crashed to
earth and was consumed." TEI's story features attention-grabbing
characters, petroleum exploration innovations, financial
innovations, and lots of risk taking.
The First Junk Bond was originally published in 1994 and
received solidly favorable reviews. The then-managing director
of High Yield Securities Research and Economics for Merrill
Lynch said that the book "is a richly detailed case study. Platt
integrates corporate history, industry fundamentals, financial
analysis and bankruptcy law on a scale that has rarely, if ever,
been attempted." A retired U.S. Bankruptcy Court judge noted,
"(i)t should appeal as supplementary reading to students in both
business schools and law schools. Even those who practice.in the
areas of business law, accounting and investments can obtain a
greater understanding and perspective of their professional
expertise."
"TEI's saga is noteworthy because of the company's resilience
and ingenuity in coping with the changing environment of the
1980s, its execution of innovative corporate strategies that
were widely imitated and its extraordinary trading history,"
says the author. TEI issued the first junk bond. In 1986 it
achieved the largest percentage gain on the NYSE, and in 1987
suffered the largest percentage loss. It issued one of the first
bonds secured by a physical commodity and then later issued one
of the first PIK (payment in kind) bonds. It was one of the
first vulture investors, to be targeted by vulture investors
later on. Its president was involved in an insider trading
scandal. It innovated strip financing. It engaged in several
workouts to sell off operations and raise cash to reduce debt.
It completed three exchange offers that converted debt in to
equity.
In 1977, TEI, primarily an oil production outfit, had had a
reprieve from bankruptcy through Michael Milken's first ever
junk bond. The fresh capital had allowed TEI to acquire a
controlling interest of Phoenix Resources Company, a part of
King Resources Company. TEI purchased creditors' claims against
King that were subsequently converted into stock under the terms
of King's reorganization plan. Only two years later, cash
deficiencies forced Phoenix to sell off its nonenergy
businesses. Vulture investors tried to buy up outstanding TEI
stock. TEI sold off its own nonenergy businesses, and focused on
oil and gas exploration. An enormous oil discovery in Egypt made
the future look grand. The value of TEI stock soared. Somehow,
however, less than two years later, TEI was in bankruptcy. What
a ride!
All told, the book has 63 tables and 32 figures on all aspects
of TEI's rise, fall, and renaissance. Businesspeople will find
especially absorbing the details of how the company's bankruptcy
filing affected various stakeholders, the bankruptcy negotiation
process, and the alternative post-bankruptcy financial
structures that were considered. Those interested in the oil and
gas industry will find the book a primer on the subject, with an
appendix devoted to exploration and drilling, and another on oil
and gas accounting.
Harlan Platt is professor of Finance at Northeastern University.
He is president of 911RISK, Inc., which specializes in
developing analytical models to predict corporate distress.
*********
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 ***