/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140714.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, July 14, 2014, Vol. 18, No. 194 Headlines 148 WEST: Approved to Sell New York Property to FEISS LLC 148 WEST: Court Confirms Liquidating Plan 30DC INC: Releases MagCast Version 6 A S TOURS: Voluntary Chapter 11 Case Summary ALLEN BIRD: 8th Cir. Says Debt Owed to Shaffer Not Dischargeable ALION SCIENCE: 90% of Unsecured Notes Validly Tendered ALPHA NATURAL: Bank Debt Trades at 4% Off AMERICAN APPAREL: Inks Deal to Reconstitute Board AMERICAN MEDIA: Susan Tolson Quits as Director AMFIN FINANCIAL: 6th Cir. Remands $170MM Tax Refund Dispute API TECHNOLOGIES: Posts Fiscal Second Quarter Revenue of $53.2MM ARCHDIOCESE OF MILWAUKEE: Plan Confirmation Hearing Canceled ASP EMERALD: Moody's Assigns B2 Corp. Family Rating; Outlook Neg. AUGUSTINE PENA: 9th Cir. Affirms Chapter 7 Conversion BIONEUTRAL GROUP: Incurs $830K Net Loss in April 30 Quarter BOLDFACE GROUP: Has $4.75-Mil. Net Loss in Q1 Ended March 31 BOOMERANG SYSTEMS: Launches Exchange Offer of Common Shares BOREAL WATER: Incurs $225,000 Net Loss in First Quarter BORETS INTERNATIONAL: Moody's Changes B1 CFR Outlook to Positive BROOKSTONE HOLDINGS: Has Until Oct. 30 to Decide on Leases BROOKSTONE HOLDINGS: Court Confirms Second Modified Joint Plan BUCKCHAR LLC: Foreclosure Sale Set for July 22 BRUCE COPELAND: Cal. Appeals Court Upholds Ruling for BofA C & S JANITORIAL: Voluntary Chapter 11 Case Summary CAESARS ENTERTAINMENT: Bank Debt Trades at 6% Off CAPFA CAPITAL: Moody's Ups Series 2000F Rev. Bonds Rating to Caa2 CARIBBEAN PETROLEUM: Zeevis' Bid to Enforce Plan Release Rejected CHINA PRECISION: Common Stock Delisted From NASDAQ CHOCTAW RESORT: Moody's Raises Corporate Family Rating to B3 CLEAREDGE POWER: Taps Davis Polk to Handle Corporate Matters CLEAREDGE POWER: Proposes Key Employee Incentive Program COLDWATER CREEK: Settles Payment Plan Dispute with Creditors Group COMMONWEALTH REIT: Moody's Confirms Ba1 Preferred Stock Rating CRUMBS BAKE SHOP: Investor Group Says Co. to Seek Sale in Ch. 11 DAVE & BUSTER: Moody's Hikes Corp. Family Rating to 'B2' DAYBREAK OIL: Incurs $257,000 Net Loss in May 31 Quarter DETROIT, MI: City Entitled to Casinos Revenues, Judge Rules DEWEY & LEBOEUF: NY Prosecutor Asks Judge to Halt Civil Suit DIGITAL CONSULTING: 1st Cir. Rules in Schussel Tax Appeal DIOCESE OF GALLUP: Creditors May Probe Corpus Christi Diocese DMW MARINE: Court Narrows Trustee's Suit v. Weidner et al. DUPONT FABROS: S&P Revises Outlook to Stable & Affirms 'BB-' CCR DUTCH GOLD: Unit Buys '524 Patent From Tetra Micro EDRA BLIXSETH: Court Okays Disbursement of Funds ELBIT IMAGING: Annual Shareholders' Meeting Set on August 14 ELBIT IMAGING: Dutch Court OKs Debt Restructuring Plan of Unit EMERALD PERFORMANCE: S&P Affirms 'B' CCR; Outlook Stable ENDEAVOUR INTERNATIONAL: BlackRock Lowers Stake to 3.4% EPAZZ INC: IBC Funds Reports 9.9% Equity Stake EPAZZ INC: IBC Funds No Longer a Shareholder ESSAR STEEL: Moody's Lowers Corporate Family Rating to Ca EL POLLO LOCO: 1st Lien Debt Amendment No Impact on Moody's CFR FINJAN HOLDINGS: Daniel Chinn Named Executive Chairman FIRED UP: Encourages Committee to Work with Other Parties FIRED UP: Has Until Oct. 23 to Decide on Real Property Leases FIRED UP: Taxing Authorities Want to Intervene in Stay Motion FIRED UP: To Make Adequate Protection Payment to Independent Bank FISKER AUTOMOTIVE: Seeks to Pay $750,000 Success Fee to CRO FORCE FUELS: KCG Americas Lowers Equity Stake to Less Than 1% FULLCIRCLE REGISTRY: Inks $1.5MM Investment Agreement with Kodiak FUSION TELECOMMUNICATIONS: Amends 8.4MM Shares Resale Prospectus GEMINI HDPE: Moody's Assigns Ba2 Rating on $420MM Term Loan GENERAL MOTORS: Faces Fresh Congressional Grilling GENERAL CABLE: To Cut 1,000 Jobs in Restructuring GLOBAL BUILDING: Faces Southcoast Community Bank Foreclosure Suit GLOBAL GEOPHYSICAL: Lists $335-Mil. in Assets, $728-Mil. in Debts GUAM WATERWORKS: Fitch Rates $84.5MM Revenue Bonds 'BB' HEARTLAND MEMORIAL: DLA Piper Must Face Avoidance Suit HELP AT HOME: Case Summary & Largest Unsecured Creditors HEMISPHERE MEDIA: Loan Upsizing No Impact on Moody's B2 CFR HEMISPHERE MEDIA: S&P Affirms 'B' CCR; Outlook Stable HYPERION FOUNDATION: Miss. Court Rules in Qui Tam Action INTERSTATE BAKERIES: Liquidity Solutions' Suit Proceeds LABORATORY PARTNERS: Ch. 11 Plan Confirmed LEHMAN BROTHERS: Has Approval to Allocate $1BB to Brokerage Estate LEHMAN BROTHERS: Wins Nod to Set Aside Reserves for Secured Claims LEHMAN BROTHERS: LBI to Set Aside $3-Bil. for Unsecured Claims LEHMAN BROTHERS: Newport Appeals Disallowance of Claims LIGHTSQUARED INC: Harbinger Sues the U.S. Government LOCATION BASED TECH: Incurs $1.5-Mil. Net Loss in May 31 Quarter MARKERS COMPANIES: Case Summary & Largest Unsecured Creditors MATTESON HOLDING: Case Summary & 10 Largest Unsecured Creditors MCS AMS SUB-HOLDINGS: Moody's Lowers Corp. Family Rating to B3 MEDICURE INC: To Issue 205,867 Common Shares for Debt METRO AFFILIATES: Wayzata Stipulation Resolves Wind-Down Matters MOBIVITY HOLDINGS: Amends 23.5MM Shares Resale Prospectus MORTGAGE LENDERS: N.J. Court Rules in Sales Reps' Lawsuit MMRGLOBAL INC: Unit Inks License Agreement with Claydata MT. GOX: Bitcoin Joint Venture to Bid for Assets NATURAL MOLECULAR: Approved to Finance Liability Insurance Policy NATURAL MOLECULAR: Explore Consulting Added as Committee Member NATURAL MOLECULAR: Court Denied Motion to Remove Committee Members NATURAL MOLECULAR: MedTech Approved to Collect Past Due Accounts NEWLEAD HOLDINGS: Says Ironridge's Actions Damaging to Holders NGL ENERGY: TransMontaigne Deal No Impact on Fitch IDR NII HOLDINGS: BlackRock Lowers Equity Stake to 2.7% NII HOLDINGS: FMR LLC Stake Down to Less Than 1% OHI INTERMEDIATE: S&P Lowers CCR to 'B', Removed From CreditWatch OSMOSE HOLDINGS: Moody's Affirms 'B2' Corp. Family Rating PACIFIC THOMAS: Court Rules in Trustee Suit v. Trading Ventures PANACHE BEVERAGE: Receives Demand Notice From Natwest PATRICK HANNON: IRS Bid for Disbursement of Proceeds Denied PHI GROUP: Amends Fiscal 2012 Annual Report PINNACLE HOLDCO: S&P Retains 'B' CCR Following $40MM Debt Add-On POWER BALANCE: Confirmed Plan to Resolve Class Action Claims PRECISION OPTICS: Richard Forkey Quits as Director PRECISION OPTICS: Hershey Management Holds 18.9% Equity Stake PRETTY GIRL: Seeks to Use JP Morgan's Cash Collateral PRETTY GIRL: Seeks Extension of Schedules Filing Date QTS REALTY: Moody's Assigns B2 Corporate Family Rating QTS REALTY: S&P Assigns B+ CCR & Gives B+ Unsecured Debt Rating QUALITY DISTRIBUTION: FMR LLC Reports 3.2% Equity Stake RADIOSHACK CORP: BlackRock's Equity Stake Down to 2.3% RADNOR HOLDINGS: Tennenbaum Wins Protective Order v. Discovery RANCHER ENERGY: B F Borgers CPA PC Raises Going Concern Doubt RATCLIFFE HOLDINGS: Voluntary Chapter 11 Case Summary RIVER CITY RESORT: May File Cross-Claim in Suit v. Wingfield RUE21 INC: Bank Debt Trades at 13.4% Off SIFCO SA: Hearing on Brazilian Proceeding Adjourned to Sept. 23 SOLAR POWER: Unit Inks Cooperation Agreement with Fenyi County SOUTHCROSS ENERGY: Moody's Rates $450MM Senior Secured Loan 'B1' SOUTHCROSS ENERGY: S&P Assigns 'B' CCR & Rates $450MM Facility 'B' SOUTHCROSS HOLDINGS: S&P Assigns 'B-' Corporate Credit Rating SRKO FAMILY: JSGE Loan Agreement Maturity Extended Until Oct. 15 STELLAR BIOTECHNOLOGIES: Posts $1.8MM Net Income in May 31 Qtr. STELLAR BIOTECHNOLOGIES: Swings to $1.8-Mil. Net Income in Q3 SUPER BUY FURNITURE: Can Employ Louis Carrasquillo as Consultant SUPER BUY FURNITURE: Luis Biaggi Employment Has Court Approval TACTICAL INTERMEDIATE: Files Liquidating Plan TACTICAL INTERMEDIATE: Wants July 31 Auction for Footwear Assets THERAPEUTICSMD INC: FMR LLC Holds 11.5% Equity Stake THOMPSON CREEK: Reports Production Results for Second Quarter TRADE SECRET: Buyer Loses Appeal Over Houston BW Ruling TRUMP ENTERTAINMENT: Confirms Sept. 16 Closure of Trump Plaza TRW AUTOMOTIVE: Non-binding Proposal No Impact on Moody's Ba1 CFR UNIFRAX I: Moody's Affirms B2 Corp. Family Rating; Outlook Neg. UNIFRAX I: S&P Affirms 'B+' Rating on 1st Lien Debt UNIVERSAL BIOENERGY: Metwood Owns Majority of Outstanding Shares UNIVERSAL HEALTH: Settlement on Appointment Motion Approved VAIL LAKE: Lee & Associates Approved as Real Estate Broker WALTER ENERGY: Obtains Add'l $61.2MM Revolving Credit Facility WALTER ENERGY: Bank Debt Trades at 4.05% Off WARTBURG COLLEGE: Fitch Rates Revenue Bonds Series 2014 'BB' WEX INC: Moody's Affirms Ba3 Corp. Family Rating & Debt Rating WILLBROS GROUP: Moody's Changes B3 Rating Outlook to Positive YRC WORLDWIDE: William Davidson Appointed as Director * Elite Law Firms Dominate as Deals Proliferate * BOND PRICING: For Week From July 7 to 11, 2014 ********* 148 WEST: Approved to Sell New York Property to FEISS LLC --------------------------------------------------------- The Bankruptcy Court approved 148 West 142 Street Corp.'s contract to sell a real property located and known as 148-158 West 142nd Street, New York City, to JERY G FEISS, LLC. The Court also authorized the payment of secured creditors' allowed claims at closing. The Debtor is also authorized to satisfy at the closing from the proceeds of the sale (i) the outstanding first mortgage to Chase Bank; (ii) the lien held by the City of New York, Department of Finance; (iii) the settlement payment to SBC 2010-1, LLC, and any outstanding real estate taxes and all title and title related charges at the closing. About 148 West 142 Street Corp. 148 West 142 Street Corp. filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-22484) on April 10, 2014. Patsy J. Morton signed the petition as secretary/treasurer. Judge Robert D. Drain oversees the case. Alter & Brescia, LLP, is the Debtor's counsel. The Debtor disclosed $11,122,411 in assets and $11,275,822 in liabilities as of the Chapter 11 filing. No Committee of Unsecured Creditors has been appointed. 148 WEST: Court Confirms Liquidating Plan ----------------------------------------- The Bankruptcy Court for the Southern District of New York entered an order approving, on a final basis, the disclosure statement and confirming 148 West 142 Street Corp.'s Chapter 11 Liquidating Plan dated May 13, 2014. The Court also designated Alter & Brescia LLP as disbursing agent in accordance with the Plan. On May 13, the Court conditionally approved the Disclosure Statement. The Plan provides for the sale of the Debtor's property, and no stamp tax or similar tax will be imposed by the State of New York or by the City of New York in connection with the sale. Pursuant to the Plan and order approving the sale of the property to JERY G FEISS, LLC, the Debtor is authorized to sell, transfer, convey, or assign to JERY G all of its rights, title and interest in the property. The receiver of the Debtor, Guy T. Parisi, Esq., and any professional employed by receiver are deemed terminated pursuant to Section 543 of the Bankruptcy Code, effective upon the Plan's Effective Date. No real estate broker fees are to be paid in connection with the sale of the Debtor's property, as a real estate broker has not been retained by the Debtor in the case or by the purchaser. However, if the Court later determines that Massey Knakal is entitled to any compensation in connection with the sale of the property, the amount will be paid by the Debtor. About 148 West 142 Street Corp. 148 West 142 Street Corp. filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-22484) on April 10, 2014. Patsy J. Morton signed the petition as secretary/treasurer. Judge Robert D. Drain oversees the case. Alter & Brescia, LLP, is the Debtor's counsel. The Debtor disclosed $11,122,411 in assets and $11,275,822 in liabilities as of the Chapter 11 filing. No Committee of Unsecured Creditors has been appointed. 30DC INC: Releases MagCast Version 6 ------------------------------------ 30DC, Inc., announced the release of version 6 of the MAGCAST Digital Publishing Platform, the first version of MagCast enabling "in the moment" purchasing of digital downloadable products and available on both iOS and Android. MagCast publishers using version 6 are now able to sell downloadable products to app users immersed in a reading experience with one click using Apple and Google's massive reservoir of customers with payment details on file (dynamic in-app purchasing). MagCast is a complete business system that enables users to make money selling content on mobile devices. The platform facilitates the creation and delivery of content in digital magazine format and contains unique marketing features to optimize downloads and subscriptions. Since the platform launched in mid-June 2012, over 1,200 digital magazines have successfully published using MagCast, accounting for approximately 10% of Newsstand apps globally. There are more than 10 million customers for these apps, seven million of them during the past twelve months. Here are some of the important new features in MagCast 6: * Dynamic in-app purchasing * Expansion to the Android platform * Native Facebook, Twitter and Google Plus sharing * Email sharing * Deep links that permit publishers to send push notifications to specific pages * Survey funnel that allows creation of surveys; answers are displayed in the survey marketing tools section * Bonus code time periods * Facebook app event tracking that facilitates building custom audiences The Company announced on June 23, 2014, the completion of beta testing of MagCast for Android. It is now available as an add-on purchase along with a MagCast IOS publishing license. This development enables MagCast publishers to distribute content on Google Play as well as Apple Newsstand, significantly expanding their reach; there are 1 billion activated Android devices compared to 800 million Apple IOS devices (iPad, iPhone and iPod Touch). About 30DC Inc. New York-based 30DC, Inc., provides Internet marketing services and related training to help Internet companies in operating their businesses. It operates in two divisions, 30 Day Challenge and Immediate Edge. The Company reported a net loss of $407,642 on $1.97 million of total revenue for the year ended June 30, 2013, as compared with net income of $32,207 on $2.91 million of total revenue during the prior fiscal year. Marcum LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company has a working capital deficit and stockholders' deficiency as of June 30, 2012. These conditions raise substantial doubt about the Company's ability to continue as a going concern. A S TOURS: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: A.S. Tours, Inc. dba A.S. Midway Trailways 3834 Lewin Avenue Baltimore, MD 21215 Case No.: 14-20915 Chapter 11 Petition Date: July 10, 2014 Court: United States Bankruptcy Court District of Maryland (Baltimore) Judge: Hon. Nancy V. Alquist Debtor's Counsel: Aryeh E. Stein, Esq. MERIDIAN LAW, LLC 600 Reisterstown Road, Suite 700 Baltimore, MD 21208 Tel: (443) 326-6011 Email: astein@meridianlawfirm.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Albert A. Spence, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. ALLEN BIRD: 8th Cir. Says Debt Owed to Shaffer Not Dischargeable ---------------------------------------------------------------- Allen W. Bird, II appeals a January 7, 2014 judgment of the bankruptcy court determining the debt he owes to Larry Shaffer is nondischargeable. The United States Court of Appeals for the Eighth Circuit affirmed in a July 8, 2014 decision available at http://is.gd/GfmLUCfrom Leagle.com. In August 1986, Bird was appointed trustee in three related corporate chapter 11 bankruptcy cases in the Western District of Arkansas, which were subsequently consolidated for purposes of administration. Bird served as the trustee of the consolidated case -- In re NWFX, Inc., Bankr. No. 86-15148 -- for almost 13 years. When Bird filed his final report and account and application for final decree in NWFX, Shaffer, the equity security holder of the three corporate debtors, challenged Bird's handling of the case. The NWFX court found Bird had breached his fiduciary duty to the bankruptcy estate in a number of ways and further found Bird had committed fraud on the bankruptcy estate and the court. As a consequence of Bird's fraud, the NWFX court ordered Bird to repay $199,979.26 to the bankruptcy estate for interim trustee fees he had received from the bankruptcy estate. In August 2003, the NWFX court entered judgment against Bird in favor of the bankruptcy estate for $199,979.26 plus interest from June 22, 2001. The judgment was assigned to Shaffer, and in September 2012, following an unsuccessful appeal to the Arkansas Court of Appeals by Bird, Shaffer was allowed to register the judgment as a foreign judgment in the Washington County (Arkansas) Circuit Court. That case was, Bird v. Shaffer, 2012 Ark.App. 464, 2012 WL 3854886 (Ark. App. 2012). In November 2012, Bird filed his own petition for relief under chapter 11 of the bankruptcy code in the Eastern District of Arkansas. Shaffer filed a complaint to determine the dischargeability of the debt underlying the judgment. On Shaffer's motion for summary judgment under 11 U.S.C. Sec. 523(a)(4),2 the bankruptcy court, relying in large part on the findings in the NWFX decision, concluded the debt was nondischargeable and entered a judgment to that effect. Bird appealed. The appellate case is, Larry Shaffer, Plaintiff-Appellee, v. Allen W. Bird, II, Defendant-Appellant, No. 14-6003 (8th Cir.). ALION SCIENCE: 90% of Unsecured Notes Validly Tendered ------------------------------------------------------ Alion Science and Technology Corporation announced updated results in connection with its exchange offer, consent solicitation and unit offering relating to its 10.25% Senior Notes due 2015 and the further extension of the Early Tender Date and the Expiration Date. The transactions are part of a transaction in which the Company is seeking to refinance its existing indebtedness. As of 5:00 p.m. on July 9, 2014, according to Global Bondholder Services Corporation, the Information and Exchange Agent, approximately $213,147,000, or 90.70%, of the aggregate principal amount of outstanding Unsecured Notes had been validly tendered for exchange and not withdrawn in the exchange offer and consent solicitation pursuant to the following options in the exchange offer: The Company has extended the Early Tender Date from 5:00 p.m., New York City time on July 9, 2014, to 5:00 p.m., New York City time, on July 18, 2014. The Company has also extended the Expiration Date of the exchange offer and consent solicitation from 9:00 a.m., New York City time, on July 14, 2014 to 9:00 a.m., New York City time, on July 24, 2014. The Company has extended the expiration date of the unit offering to 5:00 p.m., New York City time, on July 18, 2014. As of 5:00 p.m. on July 9, 2014, according to Global Bondholder Services Corporation, holders of Unsecured Notes have elected to purchase approximately 93 units in the unit offering for an aggregate purchase price of approximately $55,800. The election to purchase units in the unit offering cannot be revoked, except as required by law. For each $1,000 principal amount of Unsecured Notes accepted for exchange in the exchange offer that are validly tendered (and not validly withdrawn) at or prior to 5:00 p.m., New York City time, on July 18, 2014, holders will receive an additional $15.00 in cash. Holders who tender after 5:00 p.m., New York City time, on July 18, 2014, but prior to the Expiration Date, will not be entitled to receive the Early Tender Payment. As of 5:00 p.m. on May 28, 2014, holders were no longer entitled to withdraw tendered Unsecured Notes, except as required by law. Further, since the second supplemental indenture has been entered into, holders may not revoke the related consents, except as required by law. The Company continues to take all actions necessary to complete the exchange offer, consent solicitation and unit offering and related transactions. The completion of the Transactions is subject to the conditions described in the prospectus, including the satisfaction or waiver by the Company of the minimum tender condition, which requires that 95% of the outstanding aggregate principal amount of Unsecured Notes be validly tendered (and not validly withdrawn) in the exchange offer. Subject to applicable law and certain of the Company's contractual agreements, the Company may waive certain conditions applicable to the Transactions, including the minimum tender condition, and may extend, terminate or amend the Transactions, without reinstituting the Withdrawal Deadline or extending the Expiration Date, except as required by law. Goldman, Sachs & Co. has been retained to act as the dealer manager and solicitation agent in connection with the exchange offer and consent solicitation. The information and exchange agent for the Transactions is Global Bondholder Services Corporation. About Alion Science Alion Science and Technology Corporation, based in McLean, Virginia, is an employee-owned company that provides scientific research, development, and engineering services related to national defense, homeland security, and energy and environmental analysis. Particular areas of expertise include communications, wireless technology, netcentric warfare, modeling and simulation, chemical and biological warfare, program management. Alion Science has been reporting losses for four consecutive years from Sept. 30, 2010, to Sept. 30, 2013. In 2013, Alion Science incurred a net loss of $36.59 million. Deloitte & Touche LLP, in McLean, Virginia, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2013. The independent auditors noted that the Company does not expect to be able to repay its existing debt at their scheduled maturities. The Company's financing needs, its recurring net losses, and its excess of liabilities over assets raise substantial doubt about its ability to continue as a going concern, the auditors stated. As of March 31, 2014, the Company had $610.99 million in total assets, $816.34 million in total liabilities, $61.03 million in redeemable common stock, $20.78 million in common stock warrants, $130,000 in accumulated other comprehensive loss and a $287.29 million accumulated deficit. Bankruptcy Warning "The Company's high debt levels, of which $332.5 million matures on November 1, 2014 and Alion's recurring losses will likely make it more difficult for Alion to raise capital on favorable terms and could hinder its operations. Further, default under the Unsecured Note Indenture or the Secured Note Indenture could allow lenders to declare all amounts outstanding under the Wells Fargo Agreement, the Secured Notes and the Unsecured Notes to be immediately due and payable. Any event of default could have a material adverse effect on our business, financial condition and operating results if creditors were to exercise their rights, including proceeding against substantially all of our assets that secure the Wells Fargo Agreement and the Secured Notes, and will likely require us to invoke insolvency proceedings including, but not limited to, a voluntary case under the U.S. Bankruptcy Code," the Company said in the Quarterly Report for the period ended March 31, 2014. * * * As reported by the TCR on March 10, 2014, Standard & Poor's Ratings Services said it lowered its corporate credit rating on McLean, Va.-based Alion Science and Technology Corp. to 'CC' from 'CCC+'. "The ratings downgrade reflects a capital structure that matures within 12 months, a currently 'weak' liquidity assessment, which we revised from 'less than adequate', and our expectation that we would classify an exchange offer or similar restructuring undertaken by Alion as distressed," said Standard & Poor's credit analyst Martha Toll-Reed. In the May 23, 2014, edition of the TCR, Moody's Investors Service affirmed, among other things, Alion Science & Technology Corporation's ratings including the Caa2 Corporate Family Rating. The affirmation of Alion's Caa2 corporate family rating reflects the company's continued high leverage and weak interest coverage metrics that are not anticipated to improve meaningfully in the near-term, Moody's said. ALPHA NATURAL: Bank Debt Trades at 4% Off ----------------------------------------- Participations in a syndicated loan under which Alpha Natural Resources is a borrower traded in the secondary market at 96.38 cents-on-the-dollar during the week ended Friday, July 11, 2014, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents an decrease of 0.08 percentage points from the previous week, The Journal relates. Alpha Natural Resources pays 275 basis points above LIBOR to borrow under the facility. The bank loan matures on May 31, 2020, and carries Moody's Ba2 rating and Standard & Poor's BB- rating. The loan is one of the biggest gainers and losers among 205 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. AMERICAN APPAREL: Inks Deal to Reconstitute Board ------------------------------------------------- Standard General L.P., Standard General Master Fund L.P. and Standard General Ltd. entered into a Nomination, Standstill and Support Agreement with American Apparel and Dov Charney. The Support Agreement relates to, among other things, the composition of the Company's Board of Directors, the provision by SG of financial support to the Company in an aggregate amount up to $25 million, and the creation of a special committee of the Board to oversee the continuing investigation into alleged misconduct by Dov Charney. The Standard General Parties and Mr. Charney also agreed to certain standstill and voting limitations and SG affirmed its commitment to the Company's core values, including the Company's sweatshop-free, "Made in the USA" manufacturing philosophy and maintaining the Company's manufacturing headquarters in Los Angeles, California. The Support Agreement provides that five of the seven current members of the Board will resign. Allan Mayer and David Danziger will remain as independent directors and co-Chairman of the Board. Immediately after those resignations, Messrs. Mayer and Danziger will appoint the following individuals to fill the vacancies on the Board: one individual designated by SG to the Company to serve as a Class A director of the Company, two other individuals designated by SG to the Company to serve as Class B directors of the Company and two other individuals mutually agreed between SG and the Company to serve as Class C directors of the Company. Mr. Charney agrees not to interfere with or attempt to influence the outcome of the Investigation, or access the Company's computer systems. Until the Committee makes its final determination, Mr. Charney will be entitled to receive his base salary as a consultant to the Company and will have no supervisory authority over any employees of the Company. Among other things, the Standard General Parties and Mr. Charney agreed not to, until the completion of the 2015 Annual Meeting of Stockholders, purchase or acquire any additional beneficial ownership of shares of the Company's common stock, solicit proxies or consents with respect to the Common Stock, form or join any group with respect to the Common Stock, present any proposal at a special meeting of stockholders or through action by written consent, seek the removal of any director or propose any nominee for election to the Board or grant any proxy or consent with respect to other matters. Furthermore, until the completion of the 2015 Annual Meeting of Stockholders, the Standard General Parties and Mr. Charney agreed not to effect or seek to effect any extraordinary corporate transaction, business combination, amendment to the Company's governance documents or certain other activities. As of July 9, 2014, Dov Charney beneficially owned 74,560,813 shares of common stock of American Apparel representing 42.98 percent of the shares outstanding. A full-text copy of the Agreement is available for free at: http://is.gd/yAGE4R About American Apparel Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP) -- http://www.americanapparel.com/-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel. As of September 2010, American Apparel employed over 10,000 people and operated 278 retail stores in 20 countries, including the United States, Canada, Mexico, Brazil, United Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea and China. Amid liquidity problems and declining sales, American Apparel in early 2011 reportedly tapped law firm Skadden, Arps, Slate, Meagher & Flom and investment bank Rothschild Inc. for advice on a restructuring. In April 2011, American Apparel said it raised $14.9 million in rescue financing from a group of investors led by Canadian financier Michael Serruya and private equity firm Delavaco Capital Corp., allowing the casual clothing retailer to meet obligations to its lenders for the time being. Under the deal, the investors were buying 15.8 million shares of common stock at 90 cents apiece. The deal allows the investors to purchase additional 27.4 million shares at the same price. American Apparel reported a net loss of $106.29 million on $633.94 million of net sales for the year ended Dec. 31, 2013, as compared with a net loss of $37.27 million on $617.31 million of net sales for the year ended Dec. 31, 2012. As of Dec. 31, 2013, the Company had $333.75 million in total assets, $411.15 million in total liabilities and a $77.40 million total stockholders' deficit. * * * As reported by the Troubled Company Reporter on Feb. 26, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating to 'CCC' from 'B-' on Los Angeles-based American Apparel Inc. The outlook is developing. The Troubled Company Reporter, on Nov. 21, 2013, reported that American Apparel Inc. had its corporate family rating cut one level to Caa2 by Moody's Investors Service. The clothing retailer's probability of default was also lowered one level and the outlook is negative. AMERICAN MEDIA: Susan Tolson Quits as Director ---------------------------------------------- American Media, Inc., on July 7, 2014, received a written letter of resignation from Susan Tolson stating that she resigned, effective immediately, from her position on the Board of Directors of the Company. Ms. Tolson, who was appointed to the Board by the Capital Group Stockholders, resigned to pursue other business opportunities and not as a result of any dispute or disagreement with the Company. Due to Ms. Tolson's resignation from the Board, the Audit Committee is now comprised of Philip Maslowe (Chairman), David Licht and David Hughes. About American Media Based in New York, American Media, Inc., publishes celebrity journalism and health and fitness magazines in the U.S. These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI manages 14 different Web sites. The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company. American Media, Inc., and 15 units, including American Media Operations, Inc., filed for Chapter 11 protection in Manhattan (Bankr. S.D.N.Y. Case No. 10-16140) on Nov. 17, 2010, with a prepackaged plan. The Debtors emerged from Chapter 11 reorganization in December 2010, handing ownership to former bondholders. The new owners include hedge funds Avenue Capital Group and Angelo Gordon & Co. American Media incurred a net loss of $55.54 million on $348.52 million of total operating revenues for the fiscal year ended March 31, 2013, as compared with net income of $22.29 million on $386.61 million of total operating revenues for the fiscal year ended March 31, 2012. As of Dec. 31, 2013, the Company had $565.84 million in total assets, $692.81 million in total liabilities, $3 million in redeemable noncontrolling interest, and a $129.97 million total stockholders' deficit. * * * As reported by the TCR on Nov. 20, 2013, Standard & Poor's Ratings Services raised its corporate credit rating on Boca Raton, Fla.- based American Media Inc. to 'CCC+' from 'SD'. "The upgrade follows the company's exchange of $94.3 million of its $104.9 million 13.5% second-lien cash-pay notes due 2018 for privately held $94.3 million 10% second-lien notes due 2018," said Standard & Poor's credit analyst Hal Diamond. On July 10, 2014, the TCR reported that Moody's Investors Service has lowered American Media, Inc.'s Corporate Family Rating (CFR) to Caa1 from B3. The downgrade of American Media's CFR to Caa1 reflects Moody's expectation for lower revenue and EBITDA resulting in higher financial leverage. AMFIN FINANCIAL: 6th Cir. Remands $170MM Tax Refund Dispute ----------------------------------------------------------- The dispute between AmFin Financial Corporation, the parent of a group of banks that included AmTrust Bank; and the Federal Deposit Insurance Corp., over the ownership of a $170 million tax refund generated by AmTrust's net losses is not over yet. Last week, the U.S. Court of Appeals for the Sixth Circuit reversed a district court order that said the refund belongs to AFC's bankruptcy estate. The Sixth Circuit remanded the matter with instructions that the district court consider extrinsic evidence concerning the parties' intent in light of Ohio agency and trust law. In 2006, AFC and its affiliates, including AmTrust, entered into a tax-sharing agreement for the purpose of allocating tax liability. In November 2009, AFC filed for Chapter 11 bankruptcy protection, and, as part of that reorganization, the federal Office of Thrift Supervision closed AmTrust and placed it into FDIC receivership. AFC later filed a consolidated 2008 tax return on behalf of the Affiliated Group showing a total net operating loss of $805 million, with AmTrust's losses accounting for $767 million of the total. After AFC took the position that any refund would belong to its bankruptcy estate, the parties agreed by stipulation to deposit refunds in a segregated account pending full adjudication of the parties' respective ownership claims. When the IRS issued the Affiliated Group's $194,831,455 refund to AFC, it deposited the refund as agreed. The FDIC maintains that $170.4 million of that refund, plus interest, belongs to AmTrust because that portion results solely from offsetting AmTrust's 2008 net operating loss against its income in prior years. AFC concedes that AmTrust's tax situation generated the Refund. The FDIC filed a complaint seeking a declaratory judgment that AmTrust owns the Refund. The FDIC later moved to amend its complaint after uncovering new evidence regarding the parties' intent as to the ownership of refunds. The district court denied this motion, granting AFC judgment on the pleadings instead. Borrowing another court's analysis of a different TSA, the district court reasoned that the TSA's use of terms such as "reimbursement" and "payment" definitively established a debtor- creditor relationship between AFC and its subsidiaries as to tax refunds, thereby justifying the court's awarding the Refund to AFC's bankruptcy estate. Though the FDIC proffered extrinsic evidence showing that the parties intended to create an agency or trust relationship under Ohio law with respect to tax refunds, the district court declined to consider that evidence and rejected the FDIC's trust and agency arguments without further analysis. The FDIC appealed. "Because the TSA says nothing about the ownership of refunds and we decline to apply federal common law, we agree with the FDIC's alternative argument that the district court must look to the evidence of the parties' intent unearthed during discovery. The FDIC contends that this evidence shows either a trust or agency relationship with respect to tax refunds, such that the Refund properly belongs to AmTrust. AFC lodges a number of objections to the consideration of this evidence. None has merit," the Sixth Circuit said. The appellate case is, FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver of AmTrust Bank, Petitioner-Appellant, v. AMFIN FINANCIAL CORPORATION; AMFIN REAL ESTATE INVESTMENTS, INC.; AMFIN INSURANCE AGENCY, INC.; AMFIN INVESTMENTS, INC.; AMFIN PROPERTIES, INC.; AMFIN MANAGEMENT, INC., Respondents-Appellees, No. 13-3669 (6th Cir.). Sixth Circuit Judge Deborah L. Cook delivered the opinion of the court, in which Judge David McKeague joined and Judge Ronald Lee Gilman joined except as to Part II.B of the Opinion. Judge Gilman delivered a separate concurring opinion. A copy of the Sixth Circuit's July 8, 2014 Opinion, including Judge Gilman's concurring Opinion, is available at http://is.gd/OuDBvOfrom Leagle.com. Joseph Brooks, Esq., represents the FDIC. AmFin et al. are represented by: Pierre H. Bergeron, Esq. Lauren S. Kuley, Esq. SQUIRE SANDERS (US) LLP 221 E. Fourth St., Suite 2900 Cincinnati, OH 45202 Tel: 513-361-1200 E-mail: pierre.bergeron@squirepb.com lauren.kuley@squirepb.com - and - Philip M. Oliss, Esq. SQUIRE SANDERS (US) LLP 4900 Key Tower 127 Public Square Cleveland, OH 44114 Tel: 216-479-8500 E-mail: philip.oliss@squirepb.com About AmTrust Financial AmTrust Financial Corp. was the owner of the AmTrust Bank. AmTrust was the seventh-largest holder of deposits in South Florida, with $4.7 billion in deposits and 21 branches. In November 2008, the Office of Thrift Supervision issued a cease and desist order requiring AmTrust to improve its capital ratios. AmTrust Financial, together with affiliates that include AmTrust Management Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor subsidiaries include AmFin Real Estate Investments, Inc., formerly AmTrust Real Estate Investments, Inc. (Case No. 09-21328). G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland, Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey (US) LLP, in Cincinnati, Ohio, served as counsel to the Debtors. Kurtzman Carson Consultants served as claims and notice agent. Attorneys at Hahn Loeser & Parks LLP serve as counsel to the Official Committee of Unsecured Creditors. AmTrust Management estimated $100 million to $500 million in assets and debts in its Chapter 11 petition. AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4, 2009, AmTrust Bank was closed by regulators and the Federal Deposit Insurance Corporation was named receiver. New York Community Bank, in Westbury, New York, assumed all of the deposits of AmTrust Bank pursuant to a deal with the FDIC. AmTrust, nka AmFin Financial Corp., obtained confirmation of its Amended Joint Plan of Reorganization on Nov. 3, 2011. The plan was declared effective in December 2011. API TECHNOLOGIES: Posts Fiscal Second Quarter Revenue of $53.2MM ---------------------------------------------------------------- API Technologies Corp. reported a net loss of $14.89 million on $53.16 million of net revenue for the three months ended May 31, 2014, as compared with net income of $7.47 million on $64.22 million of net revenue for the same period last year. For the six months ended May 31, 2014, the Company reported a net loss of $17.10 million on $112.08 million of net revenue as compared with a net loss of $6.95 million on $122.53 million of net revenue for the same period a year ago. The Company's balance sheet at May 31, 2014, showed $288.35 million in total assets, $174.44 million in total liabilities and $113.91 million in total shareholders' equity. "While our EMS business was weaker than expected in Q2, we enter Q3 with a company-wide, fully funded $123.7 million backlog and positive book-to-bill, highlighted by strong demand for our Systems, Subsystems, and Components (SSC) segment products. The strength of our differentiated technology portfolio continues to generate key customer design-ins that will drive shareholder return in the quarters ahead," said Bel Lazar, president and chief executive officer of API Technologies. A full-text copy of the press release is available for free at: http://is.gd/vO7Iji About API Technologies API Technologies designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. API Technologies' customers include many leading Fortune 500 companies. API Technologies trades on the NASDAQ under the symbol ATNY. For further information, please visit the Company Web site at www.apitech.com. For the 12 months ended Nov. 30, 2013, the Company incurred a net loss of $7.22 million on $244.30 million of net revenue as compared with a net loss of $148.70 million on $242.38 million of net revenue for the 12 months ended Nov. 30, 2012. * * * As reported by the TCR on Feb. 14, 2013, Moody's Investors Service has withdrawn all ratings of API Technologies Corp., including its Caa1 Corporate Family Rating and negative outlook due to the repayment of all rated debt. On Feb. 6, 2013, API Technologies Corp. completed a refinancing of its previously outstanding rated bank debt. All ratings of API have been withdrawn since the company has no rated debt outstanding. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on API Technologies Corp. to 'B-' from 'B'. "The downgrade reflects weaker-than-expected credit metrics resulting from less-than-expected improvements in operating performance and higher debt, including a modest increase from the recent refinancing," said Standard & Poor's credit analyst Chris Mooney. ARCHDIOCESE OF MILWAUKEE: Plan Confirmation Hearing Canceled ------------------------------------------------------------ The Archdiocese of Milwaukee notified the Bankruptcy Court that the confirmation hearing scheduled for Oct. 14-17, 2014, was canceled, after consultation with counsel for the Official Committee of Unsecured Creditors. All of the other deadlines established in the scheduling order regarding confirmation of plan had been canceled. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that the Debtor was barred from having the bankruptcy court approve its Chapter 11 plan at least until the U.S. Court of Appeals in Chicago decides an appeal brought by sexual-abuse victims regarding a $55 million cemetery trust, U.S. Bankruptcy Judge Susan V. Kelley ruled on June 20. According to the report, Judge Kelley said the bankruptcy court lacks "subject matter jurisdiction" and thus is precluded from deciding the key issue in the church's reorganization plan as a consequence of the appeal. The report related that Judge Kelley said that the appeal took away jurisdiction because it's "patently obvious" that the "plan impacts matters that are integral to the appeal." About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. ASP EMERALD: Moody's Assigns B2 Corp. Family Rating; Outlook Neg. ----------------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating (CFR) to ASP Emerald Holdings LLC (Emerald) and assigned B1 and Caa1 ratings to the Emerald Performance Materials LLC's new first and second lien credit facilities, respectively. The ratings outlook is negative in light of the leveraged acquisition by private equity firm American Securities from current sponsor Sun Capital. The existing ratings assigned to Emerald Performance Holding Group LLC will be withdrawn at transaction close. The transaction is expected to close in the third quarter of 2014 and is subject to regulatory approval. "Emerald's negative outlook reflects the initial high leverage while the rating incorporates Moody's expectation for debt reduction as the main use of cash following reasonable capex funding," said Lori Harris an Analyst at Moody's. Ratings assigned: ASP Emerald Holdings LLC Corporate family rating -- B2 Probability of default rating -- B2-PD Outlook: Negative Emerald Performance Materials, LLC New 5 year $75 million Senior Secured Revolver -- B1, LGD3 New 7 year $525 million Senior Secured 1st Lien Term Loan -- B1, LGD3 New 8 year $230 million Senior Secured 2nd Lien Term Loan -- Caa1, LGD5 Outlook: Negative Ratings Affirmed: Emerald Performance Materials, LLC $325 million Sr Sec 1st Lien Term Loan due 2018 -- B1, LGD3* Ratings to be withdrawn upon close of the transaction: Emerald Performance Holding Group, LLC Corporate family rating -- B2 Probability of default rating -- B2-PD * Rating to be withdrawn upon funding of the acquisition Ratings Rationale Emerald's B2 CFR reflects its elevated leverage (6.7x pro forma for the transaction), modest size (revenues of roughly $720 million for the LTM ended March 31, 2014), somewhat limited operating history under the current structure, and the potential for event risk driven by the new sponsor, American Securities. The rating also incorporates Moody's expectation for debt reduction over the next 18 months resulting in a leverage ratio well below 6.0x by FYE 2015. The business is uniquely structured in that the CEO position has been eliminated and each of the four business segments is run autonomously by a separate president, increasing the possibility for a divestiture of one of Emerald's segments or product line. While the credit agreement is expected to allow for such divestitures (excluding the Kalama business), it will also mandate that proceeds must be partially used to reduce leverage by 0.5x from the closing total net leverage ratio. Though such a transaction would be favorable in terms of leverage, the greater concentration of earnings could be a credit negative. The ratings are supported by the company's meaningful market positions in many of its niche market segments, moderate product portfolio diversity, expansion of material margins despite volatile feedstock prices (toluene feed stocks costs represent roughly one-third of Emerald's manufacturing costs), and unique opportunity for growth in non-phthalate plasticizers. While leverage is significantly elevated, Emerald has good liquidity and is expected to be better-positioned to cover its interest payments going forward due to earnings growth and lower interest rate debt. Emerald's geographical footprint (seven US manufacturing facilities, one facility in the Netherlands, and a tolling operation in Argentina) and limited customer concentration (no customer represents more than 6% of sales) are also viewed as credit positives. Emerald's liquidity is primarily supported by its $75 million senior secured revolver, which is expected to be undrawn at the close of the transaction and little used thereafter. While capital expenditures have been elevated over the past two years due to planned capacity increases, cash flow will likely improve over the next 2 years as capital spending winds down. The new first lien term loan facility has a 50% excess cash flow sweep mechanism, with step-downs to 25% at 5.75x total net leverage and 0% at 5.25x total net leverage. The revolver will have a springing first lien leverage ratio of 6.9x when drawn more than 35%, with which Emerald should be comfortably in compliance over the next 12-18 months. The second lien term loan facilities will not contain financial covenants. The negative outlook is driven primarily by Emerald's elevated pro forma leverage (6.7x for the LTM ended March 31, 2014 including Moody's standard adjustments). The outlook could be stabilized if Emerald reduces and sustains leverage below 6.0x. The ratings currently have limited upside. The ratings could be lowered should the company fail to reduce leverage below 6.0x over the next twelve to eighteen months, or if the company were to divest a business segment and further concentrate earnings with resulting leverage above 5.5x. The principal methodology used in rating Emerald was the Global Chemical Industry Rating Methodology published in December 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. ASP Emerald Holdings LLC, headquartered in Cuyahoga Falls, Ohio, is a producer of specialty chemicals used in a wide range of food and industrial applications. The company, upon completion of the acquisition, will be owned by funds managed by American Securities LLC and reported sales of roughly $720 million for the LTM ended March 31, 2014. AUGUSTINE PENA: 9th Cir. Affirms Chapter 7 Conversion ----------------------------------------------------- After filing a voluntary petition for Chapter 11 bankruptcy protection, Augustine Pena spent about $16,000 of cash collateral due, he claims, to his attorney's ineffective assistance. Given an opportunity to account for the monies spent and to submit amended budgets, Pena missed court deadlines and failed to consult with his creditors to resolve the problem. As a result, the bankruptcy court converted his case to one under Chapter 7, finding that Pena had given it cause under 11 U.S.C. Sec. 1112(b), and appointed interim Chapter 7 Trustee Trudi Manfredo. The bankruptcy court also denied Pena's subsequent motion for reconsideration, and the district court affirmed the conversion order. On appeal, Pena argues that (1) there was no cause to convert his case, either because he did not use cash collateral or because any such use was not substantially harmful to any creditor; (2) unusual circumstances existed preventing the bankruptcy court from converting the case; and (3) the bankruptcy court failed to follow the public policy favoring reorganization over liquidation. Pena admitted at oral argument that the $16,000 he spent constituted cash collateral. In light of this acknowledged unauthorized use of cash collateral, as well as Pena's failure timely to produce appropriate budgets, a three-judge panel of the United States Court of Appeals, Ninth Circuit, said "we cannot find clearly erroneous the bankruptcy court's determination that at least one creditor was substantially harmed", citing Marshall v. Marshall (In re Marshall), 721 F.3d 1032, 1039 (9th Cir. 2013); 11 U.S.C. Sec. 1112(b)(4)(D). "We also decline Pena's invitation to rule that an attorney's ineffective legal advice constitutes the kind of 'unusual circumstance' forbidding a bankruptcy court from converting a case under Chapter 11 to one under Chapter 7. "Finally, we reject Pena's argument that, in converting his case, the bankruptcy court flouted the public policy favoring reorganization over liquidation. Instead, the bankruptcy court simply followed Congress's explicit instruction to convert a Chapter 11 case for cause where the unauthorized use of cash collateral substantially harms one or more creditors. "For all of these reasons, we cannot conclude that the bankruptcy court abused its discretion by converting Pena's Chapter 11 case to one under Chapter 7." The appellate case is, AUGUSTINE PENA, III, Debtor, Appellant, v. TRUDI MANFREDO, Chapter 7 Trustee, Appellee, No. 13-16986 (9th Cir.). A copy of the Ninth Circuit's July 9, 2014 Memorandum is available at http://is.gd/Q8sOVefrom Leagle.com. BIONEUTRAL GROUP: Incurs $830K Net Loss in April 30 Quarter ----------------------------------------------------------- BioNeutral Group, Inc., filed its quarterly report on Form 10-Q disclosing a net loss of $830,153 on $14,229 of revenues for the three months ended April 30, 2014, compared with a net loss of $664,554 on $1,085 of revenues for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $8.92 million in total assets, $4.9 million in total liabilities, and stockholders' equity of $4.01 million. The Company believes that it will be able to generate significant sales by the fourth quarter of fiscal 2014 providing for sufficient cash flows to supplement its equity financing based on its current plans. If it's able to execute its plan, the Company can begin to accumulate cash reserves. There is no assurance however that its funds will be sufficient to meet its anticipated needs through its fiscal year 2014, and it may need to raise additional capital during fiscal 2014 to fund the full costs associated with its growth and development. The Company believes that it will require approximately $2 million in additional capital to achieve its goals. There can be no assurances that it will be successful in raising additional capital on favorable terms if at all. If the Company is unable to secure additional capital, it may be required to curtail its business development initiatives, impair its intellectual property and take additional measures to reduce cost in order to conserve cash. These conditions raise substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-Q is available at: http://is.gd/WRXoD0 BioNeutral Group, Inc. is focused on the development and future sale of its antimicrobial and bioneutralizer products. This life science specialty technology company is based in Newark, New Jersey. BOLDFACE GROUP: Has $4.75-Mil. Net Loss in Q1 Ended March 31 ------------------------------------------------------------ BOLDFACE Group, Inc., filed its quarterly report on Form 10-Q disclosing a net loss of $4.75 million on $313,772 of revenues for the three months ended March 31, 2014, compared with net income of $1.74 million on $3.02 million of total revenues for the same period in 2013. The Company's balance sheet at March 31, 2014, showed $3.75 million in total assets, $7.56 million in total liabilities, preferred stock of $3.91 million and a stockholders' deficit of $7.72 million. The Company's ability to continue as a going concern is dependent upon the Company's ability to generate sufficient cash flow from its planned operations to meet its obligations on a timely basis, to raise additional equity and/or debt financing and through its factoring arrangements. In connection with the execution of its business plan, the Company anticipates additional increases in operating expenses and capital expenditures relating to: (i) payments under existing licenses, (ii) investments in inventory for our Kardashian brand; (iii) research and development costs associated with new product offerings, and (iv) management and consulting costs, as well as general administrative expenses, including the costs of being a public company. The Company intends to finance these expenses by raising additional capital and generating sufficient revenues to meet short-term and long- term operating requirements. If additional financings are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict its business operations. The Company currently does not have a specific plan of how it will obtain such funding and/or generate sufficient revenues to meet its operating requirements; however, it anticipates that additional funding will be in the form of equity and/or debt financings and/or additional short-term borrowings. As such, these factors raise substantial doubt as to the Company's ability to continue as a going concern. A copy of the Form 10-Q is available at: http://is.gd/pT5Efe Santa Monica, Calif.-based BOLDFACE Group, Inc., is a celebrity beauty licensing and branding company focused on acquiring top- tier entertainment, celebrity and designer brands for opportunities in the beauty, personal care, home and fragrance markets. BOOMERANG SYSTEMS: Launches Exchange Offer of Common Shares ----------------------------------------------------------- Boomerang Systems, Inc., has commenced an offer to exchange outstanding unsecured convertible promissory notes and warrants to purchase common stock issued under three private placements in 2011 and 2012 for the issuance of common stock in exchange for the entire balance of the unsecured note and warrants. The holders of the following securities are eligible to participate in the Offer: * First Tranche Units consisting of $100,000 principal amount of First Tranche Eligible Note and First Tranche Eligible Warrants to purchase 25,126 shares of common stock of the Company, or a pro-rata portion thereof. The "First Tranche Eligible Notes" consist of an aggregate of $9,349,520, $1,350,000 and $925,000 principal amount 6% Convertible Promissory Notes due Nov. 1, 2016, Nov. 18, 2016, and Dec. 9, 2016, respectively, convertible at a price of $3.98 per share (after giving effect to anti-dilution adjustments to the initial conversion price of $4.25 per share). The "First Tranche Eligible Warrants" consist of warrants to purchase an aggregate of 2,349,142, 339,200 and 232,416 shares of common stock of the Company expiring on Nov. 1, 2016, Nov. 18, 2016, and Dec. 9, 2016, respectively, exercisable at a price of $3.98 per share (after giving effect to anti-dilution adjustments to the initial exercise price of $4.25 per share). The First Tranche Eligible Notes and the First Tranche Eligible Warrants were issued by the Company on Nov. 1, 2011, Nov. 18, 2011 and Dec. 9, 2011 and are referred to as the "First Tranche Eligible Securities." The Company will accept an exchange of partial First Tranche Units, provided that the number of First Tranche Eligible Notes and First Tranche Eligible Warrants included in such partial First Tranche Unit bears the same ratio as the number of First Tranche Eligible Notes and First Tranche Eligible Warrants in a First Tranche Unit; * Second Tranche Units consisting of $100,000 principal amount of Second Tranche Eligible Note and Second Tranche Eligible Warrants to purchase 21,552 shares of common stock of the Company, or a pro-rata portion thereof. The "Second Tranche Eligible Notes" consist of an aggregate of $5,000,000 and $1,200,000 principal amount 6% Convertible Promissory Notes due June 14, 2017, convertible at a price of $4.64 per share (after giving effect to anti-dilution adjustments to the initial conversion price of $5.00 per share). The "Second Tranche Eligible Warrants" consist of warrants to purchase an aggregate of 1,077,596 and 258,624 shares of common stock of the Company expiring on June 14, 2017, exercisable at a price of $4.64 per share (after giving effect to anti-dilution adjustments to the initial exercise price of $5.00 per share). The Second Tranche Eligible Notes and the Second Tranche Eligible Warrants were issued by the Company on June 14, 2012 and July 13, 2012 and are referred to as the "Second Tranche Eligible Securities." The Company will accept an exchange of partial Second Tranche Units, provided that the number of Second Tranche Eligible Notes and Second Tranche Eligible Warrants included in such partial Second Tranche Unit bears the same ratio as the number of Second Tranche Eligible Notes and Second Tranche Eligible Warrants in a Second Tranche Unit; * Third Tranche Units consisting of $100,000 principal amount of Third Tranche Eligible Note and Third Tranche Eligible Warrants to purchase 21,368 shares of common stock of the Company, or a pro-rata portion thereof. The "Third Tranche Eligible Notes" consist of an aggregate of $3,075,000 principal amount 6% Convertible Promissory Notes due Dec. 31, 2017, convertible at a price of $4.68 per share (after giving effect to anti-dilution adjustments to the initial conversion price of $5.00 per share). The "Third Tranche Eligible Warrants" consist of warrants to purchase an aggregate of 657,061 shares of common stock of the Company expiring on December 31, 2017, exercisable at a price of $4.68 per share (after giving effect to anti-dilution adjustments to the initial exercise price of $5.00 per share). The Third Tranche Eligible Notes and the Third Tranche Eligible Warrants were issued by the Company on December 28, 2012 and are referred to as the "Third Tranche Eligible Securities." The Company will accept an exchange of partial Third Tranche Units, provided that the number of Third Tranche Eligible Notes and Third Tranche Eligible Warrants included in such partial Third Tranche Unit bears the same ratio as the number of Third Tranche Eligible Notes and Third Tranche Eligible Warrants in a Third Tranche Unit; "We believe that the exchange offer is mutually beneficial for the unsecured note and warrant holders and Boomerang Systems," said Mark Patterson, chief executive officer of the Company. "We are making this Offer to settle the balances of the Eligible Notes and give the holders of the Eligible Securities common stock of the Company. The exchange under the Offer provides an opportunity for the Company to relieve some of the outstanding debt as we believe we will need to raise additional funds in the near future to fund operations, and we do not believe we will able to raise additional equity capital unless we exchange all or a substantial portion of the Eligible Securities." About Boomerang Systems Headquartered in Morristown, New Jersey, Boomerang Systems, Inc. (Pink Sheets: BMER) through its wholly owned subsidiary, Boomerang Utah, is engaged in the design, development, and marketing of automated racking and retrieval systems for automobile parking and automated racking and retrieval of containerized self-storage units. Boomerang Systems incurred a net loss of $11.22 million for the year ended Sept. 30, 2013, following a net loss of $17.42 million for the year ended Sept. 30, 2012. The Company's balance sheet at March 31, 2014, showed $6.19 million in total assets, $21.51 million in total liabilities and a $15.31 million total stockholders' deficit. Bankruptcy Warning "Our operations may not generate sufficient cash to enable us to service our debt. If we were to fail to make any required payment under the Loan Agreement, notes and agreements governing our indebtedness or fail to comply with the covenants contained in the Loan Agreement, notes and agreements, we would be in default. A debt default could significantly diminish the market value and marketability of our common stock and could result in the acceleration of the payment obligations under all or a portion of our consolidated indebtedness, or a renegotiation of our Loan Agreement with more onerous terms and/or additional equity dilution. If the debt holders were to require immediate payment, we might not have sufficient assets to satisfy our obligations under the Loan Agreement, notes or our other indebtedness. It may also enable their lenders under the Loan Agreement to foreclose on the Company's assets and/or its ownership interests in its subsidiaries. In such event, we could be forced to seek protection under bankruptcy laws, which could have a material adverse effect on our existing contracts and our ability to procure new contracts as well as our ability to recruit and/or retain employees. Accordingly, a default could have a significant adverse effect on the market value and marketability of our common stock," the Company said in the annual report for the year ended Sept. 30, 2013. BOREAL WATER: Incurs $225,000 Net Loss in First Quarter ------------------------------------------------------- Boreal Water Collection, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $225,372 on $450,087 of sales for the three months ended March 31, 2014, as compared with a net loss of $239,113 on $480,672 of sales for the same period last year. The Company's balance sheet at March 31, 2014, showed $3.07 million in total assets, $2.54 million in total liabilities and $536,291 in total stockholders' equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/gdM0J4 About Boreal Water Kiamesha Lake, N.Y.-based Boreal Water Collection, Inc., is a personalized bottled water company specializing in premium custom bottled water. Boreal Water reported net income of $849,748 on $2.15 million of sales for the year ended Dec. 31, 2013, as compared with a net loss of $822,902 on $2.68 million of sales in 2012. Terry L. Johnson, CPA, in Casselberry, Florida, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditor noted that the Company has incurred a deficit of approximately $2.5 million and has used approximately $400,000 of cash due to its operating activities in the two years ended Dec. 31, 2013. The Company may not have adequate readily available resources to fund operations through Dec. 31, 2014. This raises substantial doubt about the Company's ability to continue as a going concern. BORETS INTERNATIONAL: Moody's Changes B1 CFR Outlook to Positive ---------------------------------------------------------------- Moody's Investors Service, has changed to positive from stable the outlook on the B1 corporate family rating (CFR), the B1-PD probability of default rating (PDR) of Borets International Ltd, and the B1 senior unsecured rating of notes issued by Borets Finance Limited, a wholly owned subsidiary of Borets. Moody's has also affirmed all ratings. Ratings Rationale The rating action reflects the solid operating performance of Borets and the expectation of gradual deleveraging going forward. It also reflects evidence of Borets' continuous adherence to the sound corporate governance standards after the buyback of shares held by Weatherford International Ltd in September 2013 and the following acquisition by EBRD and IFC of a 5% and 3% stake in the company respectively, with comfortable protection of creditors and minority rights. The fact that both EBRD and IFC have significant participation in the notes provides additional comfort that the company's financial policy will balance the interest of shareholders and creditors. Moody's also acknowledges the continuous development of Borets' international operations without support from Weatherford. In particular, Borets gained a new international client, and made the first commercial installations of one of its new technologies following successful trials throughout 2013. The ratings and the positive outlook reflect Borets' focus on positive free cash flow generation, the expectation that significant cash balances are likely to be accumulated over time and moderate debt service requirements until the maturity of the bond in 2018. Strong liquidity and cash flows compensate for the significant step up in leverage following the share buyback, with adjusted debt/EBITDA increasing to 3.7x (1.1x in 2012). Moody's also believes that the 2013 decline in profitability (with an adjusted EBITDA margin declining to 17% from 19% in 2012) will be temporary as a result of one-off spending related to the restructuring of international and domestic businesses, as well as the competitive pricing environment in the Russian market. In 2014, despite the negative effect of rouble devaluation and still tight pricing in Russia, Borets should restore its profitability owing to a number of optimisation measures, including reorganisation of production facilities, and the launch of the Stary Oskol plant in May 2014. Higher profitability should in turn result in adjusted debt/EBITDA going down to below 3.5x in 2014. However, Moody's cautions that the adverse economic and political environment in Russia and potential further rouble devaluation may still moderately affect the company's operating and financial results. Borets' ratings also incorporate (1) its leading position in the niche ESP market with long-standing customer relationships; (2) its increasing geographical diversification; (3) favourable industry dynamics globally, supported by the increasing need for oil recovery enhancement technologies; and (4) its historically proven resistance to market volatility, underpinned by strong business fundamentals. At the same time, Borets' B1 rating remains constrained by (1) its small scale and focus on a single product line (ESP); (2) limited (albeit gradually increasing) geographic and customer diversification relative to its global peers; and (3) competition in the higher-end segment from larger-scale global players and Russian competitors in the lower-end segment, as well as from Chinese producers. Rationale For Positive Outlook The positive outlook on the ratings reflects the potential for the upgrade of Borets' ratings over the next 12-18 months based on Moody's expectation that the company will deliver on its operating targets, including sustainable growth of its international business while maintaining robust cash flow generation, solid liquidity profile and gradual deleveraging. What Could Change The Ratings Up/Down Moody's would consider upgrading Borets' rating if the company were to continue (1) adhering to sound corporate governance; and (2) demonstrating robust operational performance, further increasing the scale of its operations and geographical diversification. In addition, to consider a rating upgrade, Moody's would expect Borets to reduce its leverage (measured as adjusted debt/EBITDA) comfortably below 3.5x on a gross basis or 3.0x on a net basis while maintaining a solid liquidity profile and positive free cash flow generation. Consideration of net leverage reflects that cash is expected to be accumulated over time in view of the bullet debt structure and the positive free cash-flow. Negative pressure, though currently unlikely, could be exerted on Borets' ratings as a result of (1) material debt-financed acquisitions or capital investments; (2) aggressive shareholder distribution; or (3) a material deterioration in Borets' competitive position resulting in an increase in leverage, as measured by adjusted debt/EBITDA, sustainably above 4x. Principal Methodologies The principal methodology used in these ratings was the Global Oilfield Services Rating Methodology published in December 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. Borets International Limited is a leading vertically integrated manufacturer of artificial lift products for the oil sector, specialising in the design and manufacture of electric submersible pumps (ESP) and related products and provision of related services. In 2013, Borets generated $767 million in sales and $127 million of adjusted EBITDA and reported $830 million in assets. BROOKSTONE HOLDINGS: Has Until Oct. 30 to Decide on Leases ---------------------------------------------------------- The Bankruptcy Court extended until Oct. 30, 2014, Brookstone Holdings Corp., et al.'s time to assume or reject unexpired leases of nonresidential real property. The court also ordered that the extended assumption/rejection period for the lease between Bohannon Development Company and Brookstone Company, Inc., will be the earlier of (a) the date of entry of an order confirming a plan with respect to Brookstone Company, Inc., and (b) Aug. 15, 2014. About Brookstone Holdings Brookstone Holdings Corp. and its affiliated debtors on April 3, 2013, filed for relief under Chapter 11 (Bankr. D. Del. Lead Case No. 14-10752) with a plan to sell its business to another retailer. Specialty retailer Brookstone operated 242 retail stores across 40 states and Puerto Rico as of Feb. 1, 2014. Of those stores, 195 are generally located near "center court" in America's top retail centers and 47 are located in airports. Brookstone also operates an e-commerce business that includes the Brookstone catalog and http://www.Brookstone.com/ An affiliate of Spencer Spirit Holdings Inc., the parent of gift- shop chain Spencer's, has signed a deal to pay $147 million in exchange for 100% of the reorganized debtor's equity, absent higher and better offers from other parties. As of Dec. 31, 2013, Spencer operated 644 stores in 49 states and Canada. As of the bankruptcy filing, the Debtors owe more than $50 million on a senior secured prepetition credit facility ($34.1 million on a revolver, $12.3 million on a term loan and $4.7 million on account of letters of credit), and $137.3 million to holders of junior notes. The Debtors estimate that their unsecured debt is between $75 million and $85 million. The agreement with Spencer contemplates that Brookstone, headquartered in New Hampshire, will continue to operate its mall and airport stores, catalog, website, and wholesale channels, under the Brookstone brand with current employees remaining at their respective locations. The Debtors have tapped K&L Gates LLP and Landis Rath & Cobb LLP as attorneys, Deloitte Financial Advisory Services LLP as their financial advisors, Jefferies LLC as their investment banker, and Kurtzman Carson Consultants as claims agent. The DIP lenders are represented by Stroock & Stroock & Lavan LLP and Young Conaway Stargatt & Taylor LLP. BROOKSTONE HOLDINGS: Court Confirms Second Modified Joint Plan -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware confirmed on June 24, 2014, BrookStone Holdings Corp., et al.'s Second Modified Joint Plan of Reorganization. The Court overruled objections to the Plan. In the Debtors' memorandum of law dated June 19, in support of confirmation of their second modified plan, the Debtor said the Plan is supported by a substantial majority of creditors entitled to vote on the Plan and incorporates a global restructuring proposal negotiated among the Debtors' main creditor constituencies that inures to the benefit of the Debtors' creditors. As reported in the Troubled Company Reporter on June 23, 2014, the Debtor disclosed in a Form T-3 filing with the Securities and Exchange Commission that the 10.0% Second Lien Subordinated Secured Notes due 2021 of the Company to be issued under an indenture, will be offered to holders of the Company's 13.00% Second Lien Senior Secured Notes due 2014 pursuant to the terms of the Debtors' Second Modified Plan dated June 13, 2014. The Plan will become effective on the date on which all conditions to consummation of the Plan have been satisfied or waived. The Notes and related guarantees are being offered in exchange for the Old Notes and related guarantees at an exchange ratio of approximately $79.61 principal amount of New Notes for each $1,000 principal amount of Old Notes. A copy of the Disclosure Statement, dated May 16, 2014, with respect to the Plan of Reorganization is available at http://is.gd/rk49ER A copy of the Debtors' Second Modified Joint Chapter 11 Plan of Reorganization is available at http://is.gd/FGXmhC A copy of the Order Approving the Disclosure Statement, dated May 19, 2014, is available at http://is.gd/hRhw3o About Brookstone Holdings Brookstone Holdings Corp. and its affiliated debtors on April 3, 2013, filed for relief under Chapter 11 (Bankr. D. Del. Lead Case No. 14-10752) with a plan to sell its business to another retailer. Specialty retailer Brookstone operated 242 retail stores across 40 states and Puerto Rico as of Feb. 1, 2014. Of those stores, 195 are generally located near "center court" in America's top retail centers and 47 are located in airports. Brookstone also operates an e-commerce business that includes the Brookstone catalog and http://www.Brookstone.com/ An affiliate of Spencer Spirit Holdings Inc., the parent of gift- shop chain Spencer's, has signed a deal to pay $147 million in exchange for 100% of the reorganized debtor's equity, absent higher and better offers from other parties. As of Dec. 31, 2013, Spencer operated 644 stores in 49 states and Canada. As of the bankruptcy filing, the Debtors owe more than $50 million on a senior secured prepetition credit facility ($34.1 million on a revolver, $12.3 million on a term loan and $4.7 million on account of letters of credit), and $137.3 million to holders of junior notes. The Debtors estimate that their unsecured debt is between $75 million and $85 million. The agreement with Spencer contemplates that Brookstone, headquartered in New Hampshire, will continue to operate its mall and airport stores, catalog, website, and wholesale channels, under the Brookstone brand with current employees remaining at their respective locations. The Debtors have tapped K&L Gates LLP and Landis Rath & Cobb LLP as attorneys, Deloitte Financial Advisory Services LLP as their financial advisors, Jefferies LLC as their investment banker, and Kurtzman Carson Consultants as claims agent. The DIP lenders are represented by Stroock & Stroock & Lavan LLP and Young Conaway Stargatt & Taylor LLP. BUCKCHAR LLC: Foreclosure Sale Set for July 22 ---------------------------------------------- Buckchar, LLC, defaulted on a Note on account of $2,010,250 in debts. Pursuant to an order by the General Court of Justice Superior Court of the State of North Carolina, Randolph County, the property securing the debt will be sold at public auction to the highest bidder for cash at 3:30 p.m. on July 22, 2014, at the Courthouse door in Asheboro, Randolph County, North Carolina. The property consists of all of the debtor's right, title and interest in the real property at 11651 N. Main St. (aka 3030 S. Main St., High Point) and 3+ Acres off Archdale Rd., Archdale, NC, 27263. The property will be sold subject to taxes, assessments, and any superior easements, rights of way, restrictions of record, liens, or other encumbrances prior to the lien of the deed of trust being foreclosed. The sale will remain open for increased bids for 10 days after report thereof to the Clerk of Superior Court. In the event the debtor files a bankruptcy petition prior to the expiration of the 10-day period required by G.S. 45-21.27, an automatic stay of the foreclosure will be imposed in accordance with the Bankruptcy Code Sec. 362, and the bidder must pursue relief through the bankruptcy court. The Trustee may require the high bidder to deposit cash at the sale in an amount equal to the greater of 5% of the amount of the bid or $750. If no upset bid is filed, the balance of the purchase price, less deposit, must be made in cash upon tender of the deed. Third party purchasers at sale must pay the tax of $0.45 per $100 as required by NCGS 7A-308(a)(1). The Trustee conducting the sale may be reached at: Richard A. Manager Substitute Trustee 1208 Eastchester Drive, Suite 101 High Point, NC 27265 Tel: (336) 882-2000 BRUCE COPELAND: Cal. Appeals Court Upholds Ruling for BofA ------------------------------------------------------------ Bruce Dwain Copeland, a Chapter 11 debtor, appeals a trial court's denial of his motion to set aside default judgment, which was entered in favor of Plaintiff-in-intervention Bank of America N.A. (Bank of America), successor by merger to BAC Home Loans Servicing LP formerly known as Countrywide Home Loans Servicing LP. Copeland filed one answer in this case, which was stricken by the trial court for lack of standing. Copeland failed to file any other responsive pleading. In a July 10, 2014 decision available at http://is.gd/kc14i9from Leagle.com, the Court of Appeals of California, Second District, Division Three, affirmed the trial court's denial of the motion to set aside because Bank of America adhered to Code of Civil Procedure1 section 587 in requesting default and Copeland fails to satisfy Code of Civil Procedure 473.5 to set aside the default. "We conclude that the trial court did not abuse its discretion in denying Copeland's motion to set aside the default," the Appeals Court said. The case is, BANK OF AMERICA, N.A., Plaintiff and Respondent, v. BRUCE DWAIN COPELAND, Defendant and Appellant, NO. B247996 (Cal. App.). C & S JANITORIAL: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: C & S Janitorial Services, Inc. 6706 Bourgeois Road Houston, TX 77066-3105 Case No.: 14-33846 Chapter 11 Petition Date: July 10, 2014 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Hon. Jeff Bohm Debtor's Counsel: Margaret Maxwell McClure, Esq. LAW OFFICE OF MARGARET M. MCCLURE 909 Fannin, Suite 3810 Houston, TX 77010 Tel: 713-659-1333 Fax: 713-658-0334 Email: margaret@mmmcclurelaw.com Estimated Assets: $50,000 to $100,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Sergio Limon, president and CEO. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. CAESARS ENTERTAINMENT: Bank Debt Trades at 6% Off ------------------------------------------------- Participations in a syndicated loan under which Caesars Entertainment Inc. is a borrower traded in the secondary market at 93.61 cents-on-the-dollar during the week ended Friday, July 11, 2014, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents an increase of 0.42 percentage points from the previous week, The Journal relates. Caesars Entertainment Inc. pays 525 basis points above LIBOR to borrow under the facility. The bank loan matures on Jan. 1, 2018, and carries Moody's B3 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 205 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. CAPFA CAPITAL: Moody's Ups Series 2000F Rev. Bonds Rating to Caa2 ----------------------------------------------------------------- Moody's Investors Service has upgraded to Caa2 the underlying rating on CaPFA Capital Corp. 2000F's Student Housing Revenue Bonds, Senior Series 2000F-1 issued by Capital Projects Finance Authority, FL. The outlook is stable. The action affects $120,650,000 outstanding bonds. The underlying rating of Caa2 is enhanced by bond insurance provided by National Public Finance Guarantee Corporation (rated A3). Rating Rationale The upgrade is based on the improved performance of the project which has successfully paid debt service on the senior bonds but does not demonstrate sufficient surplus revenues to pay down $55.8 million of additional debt obligations or replenish a depleted debt service reserve fund. The Caa2 rating reflects the bond program's constrained ability to replenish its debt service reserve fund which is necessary for the final debt service payment in 2031 and helps the project absorb any short-term disruptions to financial performance. The $55.8 million additional indebtedness, representing the bond insurer's claim and funding for capital repairs, offsets the project's improved occupancy after completed repairs and the reinstatement of the referral agreement with the University of Central Florida (Aa3 stable). Strengths -- Capital repairs to Knight's Circle are complete allowing all 3,756 beds to be online -- Affiliation with the University of Central Florida (Aa3 stable) which has a large and growing student population Challenges -- Depleted debt service reserve fund which hinders the project's ability to make final debt service payment on Oct. 1, 2031 -- Insufficient operating revenue to pay down principal and approximately $2.9 million of accrued interest on $55.8 million of additional indebtedness prior to replenishing reserves -- Highly competitive submarket with competition from university- owned housing and new off-campus housing which limits the project's ability to reach full occupancy or increase rental rates. Outlook The outlook is stable because projected occupancy for Fall 2014 is expected to produce sufficient revenues to meet debt service payments. What Could Change the Rating Up -- Financial performance resulting in higher surplus revenues after bond debt service and substantial reduction of the $55.8 million indebtedness that enables a strong likelihood that reserves will be replenished What Could Change the Rating Down -- Deterioration of performance, as indicated by lower occupancy or increased expenses, that results in less net operating income and an inability to cover bond debt service Rating Methodology The principal methodology used in this rating was Global Housing Projects published in July 2010. CARIBBEAN PETROLEUM: Zeevis' Bid to Enforce Plan Release Rejected ----------------------------------------------------------------- Bankruptcy Judge Kevin Gross denied the post-confirmation Motion of Gad and Ram Zeevi to Enforce Plan Release and the Settlement Agreement in the Chapter 11 case of Caribbean Petroleum Corp., et al. The bankruptcy filings of Caribbean Petroleum Refining, L.P., Caribbean Petroleum Corporation and Gulf Petroleum Refining (Puerto Rico) Corporation were necessitated by horrific explosions and fire involving 21 Caribbean storage tanks that occurred at its facility in Bayamon, Puerto Rico in October 2009. The Catastrophe ended Caribbean's operations and resulted in the bankruptcy. Prior to the bankruptcy filing, parties filed numerous actions in Puerto Rico against Caribbean to recover damages for injuries and losses they suffered as a result of the Catastrophe. The Tort Plaintiffs have exhaustively pursued their claims first in bankruptcy court and now in the United States District Court for the District of Puerto Rico, The Honorable Francisco Besosa, District Court Judge, presiding. The Tort Plaintiffs are before the Puerto Rico Court because the bankruptcy court lifted the automatic stay to enable them to proceed. The Zeevis seek to enforce the releases contained in the Fourth Amended Joint Plan of Liquidation and in a settlement agreement, dated September 30, 2013, between the Tort Plaintiffs and the Liquidation Trustee. The Zeevis are former directors (and Gad Zeevi the former President) of Caribbean. The Tort Plaintiffs objected to the Motion, as have Intertek USA, Inc. and Cape Bruny Tankschiffarts GMBH and Co. KG and Cape Bruny Shipping Company Ltd. In a July 9, 2014 Memorandum Opinion available at http://is.gd/3q9bbxfrom Leagle.com, Judge Gross said the Tort Plaintiffs, Intertek and the Cape Bruny Cos. may proceed with their actions in the Puerto Rico Court unimpeded by the Plan releases. About Caribbean Petroleum San Juan, Puerto Rico-based Caribbean Petroleum Corporation, aka CAPECO, owns and operates certain facilities in Bayomon, Puerto Rico, for the import, offloading, storage and distribution of petroleum products. Caribbean Petroleum sought Chapter 11 protection (Bankr. D. Del. Case No. 10-12553) on Aug. 12, 2010, nearly 10 months after a massive explosion at its major Puerto Rican fuel storage depot virtually shut down the company's operations. The Debtor estimated assets of US$100 million to US$500 million and debts of US$500 million to US$1 billion as of the Petition Date. Affiliates Caribbean Petroleum Refining, L.P., and Gulf Petroleum Refining (Puerto Rico) Corporation filed separate Chapter 11 petitions on Aug. 12, 2010. John J. Rapisardi, Esq., George A. Davis, Esq., Peter Friedman, Esq., and Zachary H. Smith, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serve as lead counsel to the Debtors. Mark D. Collins, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, serve as local counsel. The Debtors' financial advisor is FTI Consulting Inc. The Debtors' chief restructuring officer is Kevin Lavin of FTI Consulting Inc. Kurtzman Carson Consultants LLC serves as the noticing, claims and balloting agent to the Debtors. In December 2010, the Debtor won bankruptcy court approval to sell its business to Puma Energy International for US$82 million. Puma obtained Capeco's entire retail network, which consists of 157 locations, gasoline, diesel and other fuel storage facilities as well as undeveloped land and a private deep water jetty. The Fourth Amended Joint Plan of Liquidation for Caribbean Petroleum and its debtor affiliates became effective on June 3, 2011. CHINA PRECISION: Common Stock Delisted From NASDAQ -------------------------------------------------- The NASDAQ Stock Market LLC filed a Form 25 with the U.S. Securities and Exchange Commission to remove from listing or registration China Precision Steel, Inc.'s common stock. About China Precision Steel China Precision Steel -- http://chinaprecisionsteelinc.com-- is a niche precision steel processing company principally engaged in the production and sale of high precision cold-rolled steel products and provides value added services such as heat treatment and cutting medium and high carbon hot-rolled steel strips. China Precision Steel's high precision, ultra-thin, high strength (7.5 mm to 0.05 mm) cold-rolled steel products are mainly used in the production of automotive components, food packaging materials, saw blades, steel roofing and textile needles. The Company sells to manufacturers in the People's Republic of China as well as overseas markets such as Nigeria, Ethiopia, Thailand and Indonesia. China Precision Steel was incorporated in 2002 and is headquartered in Sheung Wan, Hong Kong. China Precision reported a net loss of $68.93 million on $36.52 million of sales revenues for the year ended June 30, 2013, as compared with a net loss of $16.94 million on $142.97 million of sales revenues during the prior fiscal year. The Company's balance sheet at March 31, 2014, showed $88.13 million in total assets, $78.16 million in total liabilities, all current and $9.97 million in total stockholders' equity. Moore Stephens, Certified Public Accountants, in Hong Kong, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company has suffered a very significant loss in the year ended June 30, 2013, and defaulted on interest and principal repayments of bank borrowings that raise substantial doubt about its ability to continue as a going concern. CHOCTAW RESORT: Moody's Raises Corporate Family Rating to B3 ------------------------------------------------------------ Moody's Investors Service upgraded Choctaw Resort Development Enterprise's Corporate Family Rating ("CFR") to B3 from Caa1 and Probability of Default Rating to B3-PD from Caa1-PD. At the same time, Moody's affirmed the Enterprise's senior unsecured notes rating at Caa1. The rating outlook is stable. Choctaw recently announced that it had refinanced its $70 million senior secured term loan due 2017 (unrated) with a $145 million senior secured term loan due 2019 (unrated). The credit agreement, among other things, provides Choctaw with $75 million to pre-fund capex projects, lowers the interest rate on the term loan and provides some covenant flexibility. The upgrade of Choctaw's CFR to B3 reflects the improved operating performance of the Tribe's casino operations since Choctaw's new management team took over in mid-2012, as well as the Enterprise's improved liquidity profile following the refinancing of its senior secured term loan. Ratings upgraded: Corporate Family Rating to B3 from Caa1 Probability of Default Rating to B3-PD from Caa1-PD Ratings affirmed: $110 million senior unsecured notes due 2019 at Caa1 (LGD4) Rating Rationale The B3 CFR reflects Choctaw's relatively strong financial leverage and coverage metrics. For the LTM period ended March 31, 2014, pro forma for the new $145 million term loan, Choctaw's debt/EBITDA and EBIT/interest expense were 2.0 times and about 5.0 times, respectively. The Enterprise's earnings have improved following the addition of a new management team in mid-2012. Since the end of fiscal 2011, Choctaw's EBITDA has increased about 35% and margins have improved to between 35% and 45%. The margin improvement came despite 5% lower revenue over the same time period as Mississippi's economy continues to struggle with higher unemployment rates than the national average, and with management's decision to reduce its low-margin business. Although Choctaw's credit metrics are strong for the rating category, the Enterprise remains exposed to several near-term issues that will continue to constrain its ratings. Choctaw faces additional competition from the opening of two Native American Class II facilities in Alabama -- a little over 100 miles from Choctaw's Silver Star and Golden Moon casinos -- where a significant amount of Choctaw's rated players are located. While Choctaw's casinos have Class III gaming as compared to the Alabama facilities' class II games, there are still gamblers that prefer convenience if the facility offers similar amenities, so Moody's expects Choctaw's operations will be negatively affected by this new competition. The new $75 million term loan will finance needed capex at its existing properties as well as re-opening the Golden Moon casino on a full time basis which will help counter the new competition. Also, Choctaw's ratings continue to be constrained by the ongoing FBI investigation which began in 2011. While it appears that the Choctaw Tribe is not the focus of the investigation, the ratings reflect the open investigation. The ratings also take into account the relatively weak gaming demand trends in its primary market area, its significant dividend obligations and other risks common to Native American Gaming issuers. Choctaw's good liquidity profile reflects its cash balances of about $64 million at March 31, 2014, Moody's expectation that the Enterprise's internal cash flow will be sufficient to cover its interest expense, mandatory debt amortization, maintenance capex and tribal distributions over the next 12 -- 18 months. Choctaw's new credit agreement also provides up to $75 million of additional borrowing capacity for capex needs over the next 24 months. The Enterprise does not have a committed revolver in place which is a credit negative. The new credit agreement provides additional flexibility under Choctaw's covenants. Going forward, certain capex made in the first three years of the loan is excluded, and the maximum leverage allowed under the maximum total leverage covenant was increased to 3.25 times. The stable rating outlook reflects Moody's expectations that Choctaw will be able to maintain its EBITDA margins between 35% and 40% and retained cash flow/debt above 10% despite additional competition coming from relatively new Native American casinos in Alabama. Revenue and earnings growth will be driven by the renovations at the Silver Star casino and the reopening of the Golden Moon casino. The ratings could be downgraded if it appears that the FBI investigation were to have negative effects on Choctaw's gaming operations or if the Enterprise did not generate a rate of return on its capital investments sufficient to maintain its current EBITDA margins. Ratings could also be downgraded if gaming revenue trends in Mississippi were to materially decline or if gaming revenue at the Silver Star and Golden Moon casinos -- the 2 largest contributors to EBITDA -- were to decline. Ratings could be upgraded if Choctaw successfully absorbs the new competition in Alabama while growing EBITDA and retained cash flow/debt is sustained above 15%. Favorable resolution of the FBI investigation could also result in a rating upgrade. Per Moody's Loss Given Default methodology, the affirmation of the Caa1 rating on the $110 million senior unsecured notes reflects the increased amount of senior secured debt ahead of it in the capital structure. The principal methodology used in this rating was the Global Gaming Industry published in June 2014. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Choctaw Resort is a component unit of the Mississippi Band of Choctaw Indians, which was created by the Tribe in October 1999 to run its gaming operations. It owns and operates in central Mississippi the Silver Star Hotel and Casino, the Golden Moon Hotel and Casino and the Bok Homa Casino, which commenced operations in 1994, 2002 and 2010, respectively. CLEAREDGE POWER: Taps Davis Polk to Handle Corporate Matters ------------------------------------------------------------ ClearEdge Power, Inc., et al., ask the Bankruptcy Court for the Northern District of California for permission to employ Davis Polk & Wardwell LLP as special counsel. Davis Polk will, among other things: a. perform services, including providing advice relating to: certain corporate matters; corporate governance; disclosure requirements; corporate transactions; securities law, regulations and compliance; merger or asset disposition issues; investigation, research and analysis of legal and factual corporate issues; b. provide services pertaining to other related matters as tax issues, employee benefit issues, employment issues, and general commercial litigation as the Debtors may determine necessary or appropriate to commence or defend; and c. provide services relating to negotiations with potential lenders and investors regarding financing, equity investment, merger and acquisition, well as preparing, drafting or reviewing any documents related thereto. As of the Petition Date, Davis Polk held an advance retainer in the amount of $63,969. The Debtors and Davis Polk have agreed that Davis Polk may apply the advance retainer to the extent necessary to pay any allowed fees, costs and expenses relating to services rendered by Davis Polk to the Debtors after the Petition Date. In the one-year period prior to the commencement of the Chapter 11 cases, Davis Polk received a total of $128,529. The hourly rates of the attorneys of Davis Polk that will be representing the Debtors range from $325 to $1,095. The current hourly rates of attorneys performing services on behalf of the Debtors, along with the hourly rates of paralegals who may provide assistance are: Partners and Counsel $870 to $1,095 Associates $325 to $870 Paraprofessionals $195 to $245 To the best of the Debtors' knowledge, Davis Polk and its professionals neither represent nor hold any interest adverse to the Debtors or their estates with respect to the matters on which Davis Polk is to be employed in the cases. The Debtor can be reached at: John Walshe Murray, Esq. Stephen T. O'Neill, Esq. Robert A. Franklin, Esq. Thomas T. Hwang, Esq. DORSEY & WHITNEY LLP 305 Lytton Avenue Palo Alto, CA 94301 Tel: (650) 857-1717 Fax: (650) 857-1288 E-mails: murray.john@dorsey.com oneill.stephen@dorsey.com franklin.robert@dorsey.com hwang.thomas@dorsey.com About ClearEdge Power Sunnyvale, California-based ClearEdge Power Inc. and two other affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Cal. Lead Case No. 14-51955) on May 1, 2014, in San Jose. Affiliates ClearEdge Power, LLC, and ClearEdge Power International Service, LLC, are based in South Windsor, Connecticut, where the manufacturing operations are located. Privately held ClearEdge designs, manufactures, sells and services distributed generation fuel cell systems for commercial, industrial, utility and residential applications. ClearEdge bought United Technologies Corp.'s UTC Power division in late 2012. ClearEdge sought bankruptcy protection just a week after shutting operations. John Walshe Murray, Esq., at Dorsey and Whitney LLP, serves as counsel to the Debtors. Insolvency Services Group, Inc., serves as noticing and claims agent. ClearEdge Power disclosed $31,271,670 in assets and $67,414,779 in liabilities as of the Chapter 11 filing. Power Inc. estimated $100 million to $500 million in both assets and debts. The petitions were signed by David B. Wright, chief executive officer. On May 22, 2014, the U.S. Trustee for Region 17 appointed five creditors to serve in the Committee. The Committee has hired Brown Rudnick as Counsel and Teneo Securities as financial advisors. CLEAREDGE POWER: Proposes Key Employee Incentive Program -------------------------------------------------------- ClearEdge Power Inc., et al., ask the Bankruptcy Court to authorize them to establish and administer a key employee incentive program. The KEIP is an incentive-based compensation program centered around the consummation of the sale of the Debtors' assets. The KEIP is (i) designed to incentivize a group of employees who are invaluable to the Company and, specifically, to three integral business aspects of the Company, to achieve a maximum return from any sale transaction; and (ii) payable only upon consummation of a sale transaction. Under the KEIP, in the event the Debtors consummate a sale transaction, the KEIP Participants will share, pro rata based on their respective salaries, positions and job categories with the Company, from a pool derived from cash proceeds received from the sale rransaction, net of taxes, commissions and other sale-related fees and charges, but prior to distributions to creditors. The Incentive Pool will be equal to 10% of the Distributable Proceeds, up to the maximum cap of $500,000. Thus, on average, each KEIP Participant would only receive, at maximum, around $9,200, pursuant to the KEIP. About ClearEdge Power Sunnyvale, California-based ClearEdge Power Inc. and two other affiliates filed for Chapter 11 bankruptcy protection (Bankr. N.D. Cal. Lead Case No. 14-51955) on May 1, 2014, in San Jose. Affiliates ClearEdge Power, LLC, and ClearEdge Power International Service, LLC, are based in South Windsor, Connecticut, where the manufacturing operations are located. Privately held ClearEdge designs, manufactures, sells and services distributed generation fuel cell systems for commercial, industrial, utility and residential applications. ClearEdge bought United Technologies Corp.'s UTC Power division in late 2012. ClearEdge sought bankruptcy protection just a week after shutting operations. John Walshe Murray, Esq., at Dorsey and Whitney LLP, serves as counsel to the Debtors. Insolvency Services Group, Inc., serves as noticing and claims agent. ClearEdge Power disclosed $31,271,670 in assets and $67,414,779 in liabilities as of the Chapter 11 filing. Power Inc. estimated $100 million to $500 million in both assets and debts. The petitions were signed by David B. Wright, chief executive officer. On May 22, 2014, the U.S. Trustee for Region 17 appointed five creditors to serve in the Committee. The Committee has hired Brown Rudnick as Counsel and Teneo Securities as financial advisors. COLDWATER CREEK: Settles Payment Plan Dispute with Creditors Group ------------------------------------------------------------------ Jacqueline Palank, writing for The Wall Street Journal, reported that under a new settlement, Coldwater Creek Inc.'s unsecured creditors will withdraw their opposition to the liquidating retailer's debt-payment plan in exchange for an extra $5.4 million. According to the report, the settlement, filed in bankruptcy court, allows Coldwater Creek to remove a major hurdle to securing court approval for its plan to pay its creditors from the proceeds of the sale of its assets. Before the settlement, the official committee representing unsecured creditors had vowed to fight the plan by pledging to vote against it and even seeking the right to file a rival plan. About Coldwater Creek Coldwater Creek is a multi-channel retailer that offers its merchandise through retail stores across the country, its catalog and its e-commerce Web site, http://www.coldwatercreek.com/ Originally founded in Sandpoint, Idaho in 1984 as a direct, catalog-based marketer, Coldwater evolved into a multi-channel specialty retailer operating 334 premium retail stores, 31 factory outlet stores and seven day spa locations throughout the United States. As of the bankruptcy filing, the Debtors domestically employ a total of approximately 5,990 employees throughout their retail locations, corporate headquarters and distribution, design and call centers. Coldwater Creek Inc. and its debtor-affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 14-10867) on April 11, 2014, to liquidate their assets. Coldwater Creek Inc. disclosed assets of $721,468,388 plus undetermined amount and liabilities of $425,475,739 plus undetermined amount. Affiliate Coldwater Creek U.S. Inc. estimated $100 million to $500 million in assets and liabilities. The Debtors have drawn $37.5 million and have approximately $10 million in letters of credit outstanding under a senior secured credit facility (ABL facility) provided by lenders led by Wells Fargo Bank, National Association, as agent. The Debtors also owe $96 million, which includes accrued interest and approximately $23 million representing a prepayment premium payable, under a term loan from lenders led by CC Holding Agency Corporation, as agent. Aside from the funded debt, the Debtors have accumulated a significant amount of accrued and unpaid trade and other unsecured debt in the normal course of their business. The Debtors have tapped Young Conaway Stargatt & Taylor, LLP, and Shearman & Sterling LLP as attorneys, Perella Weinberg Partners LP as financial advisor, Alvarez & Marsal as restructuring advisor, and Prime Clerk LLC as claims and noticing agent. The U.S. Trustee for Region Three named seven creditors to serve on the official committee of unsecured creditors. Lowenstein Sandler LLP represent the Committee. COMMONWEALTH REIT: Moody's Confirms Ba1 Preferred Stock Rating -------------------------------------------------------------- Moody's Investors Service confirmed the Baa3 senior unsecured and Ba1 preferred stock ratings of CommonWealth REIT (NYSE: CWH). The outlook is negative. This action concludes Moody's review started on March 7, 2014. The following ratings were confirmed with a negative outlook: CommonWealth REIT -- senior unsecured debt at Baa3; preferred stock at Ba1; senior unsecured shelf at (P)Baa3; preferred stock shelf at (P)Ba1. Ratings Rationale These ratings actions reflect the resolution of the office REIT's prolonged and distracting struggle between activist investors and its former management team and Board of Directors. On May 23, 2014, a new slate of trustees was elected to the Board, including Samuel Zell as Chairman and six other Directors with diverse and substantive backgrounds. This Board has put a new management team in place, which enables the REIT to move forward with a strategy to improve its operations and growth profile. Despite the increased visibility with respect to governance, Moody's note that new management is still challenged with the task of improving operations of a large, nationally diverse real estate portfolio, which has a substantial portion of non-core, weak assets with high vacancy. The negative outlook reflects the execution risk associated with transitioning and improving the REIT's operations and growth profile. Moody's notes CWH's announcement that it has sold its 22 million shares of Select Income REIT (SIR) to Government Properties Income Trust and Reit Management & Research LLC for about $705 million generates substantial liquidity while disposing of a non-core holding. The REIT is evaluating options for use of proceeds, including potential debt repayments and other corporate purposes. CWH has $5 million of debt maturities remaining in 2014 and $422 million (including its revolver balance) in 2015. Moody's considers CWH to have sufficient liquidity to meet these upcoming obligations. A return to stable would likely reflect improving core occupancy trends and substantial progress in repositioning its portfolio resulting in an improved long-term growth profile. Sustaining Net Debt/EBITDA below 6.5x and fixed charge coverage above 2.5x would also be necessary to return to stable. A downgrade would be precipitated by continued negative operating trends or a shift in capital strategy by the new management team, as evidenced by increased use of secured or overall portfolio leverage. The last rating action with respect to CommonWealth REIT was on March 7, 2014 when the ratings were placed on review for downgrade. CommonWealth REIT (NYSE: CWH) is an internally managed and self- advised real estate investment trust, which primarily owns office buildings located in central business districts and suburban locations across the United States, with executive offices in Chicago, Illinois. The principal methodology used in this rating was Global Rating Methodology for REITs and Other Commercial Property Firms published in July 2010. CRUMBS BAKE SHOP: Investor Group Says Co. to Seek Sale in Ch. 11 ---------------------------------------------------------------- Sara Randazzo, writing for The Wall Street Journal, reported that days after abruptly closing its dozens of cupcake stores, Crumbs Bake Shop Inc. filed for Chapter 11 protection on the evening of July 11 with plans to sell itself to an investor group that includes CNBC host Marcus Lemonis and Dippin' Dots owner Fischer Enterprises. According to the report, the company, which once sold four-inch, frosting-laden cupcakes for as much as $4.50 each, listed assets and liabilities of between $10 million and $50 million each in a filing made in U.S. Bankruptcy Court in New Jersey. In a statement, the investor group said it plans to provide Crumbs with financing to complete the Chapter 11 process and, subject to court approval, intends to acquire Crumbs' assets to create a new, privately held company that will reopen Crumbs stores, the report related. DAVE & BUSTER: Moody's Hikes Corp. Family Rating to 'B2' -------------------------------------------------------- Moody's Investors Service upgraded Dave & Buster's Inc.'s ("D&B") ratings, including its Corporate Family Rating ("CFR") to B2 from B3, Probability of Default Rating to B2-PD from B3-PD, senior secured rating to Ba2 from Ba3, and its senior unsecured rating to B2 from B3. Concurrently, Moody's rated the company's proposed $580 million bank facility B2 and assigned a Speculative Grade Liquidity rating of SGL-2. The company is planning to use the proceeds from the proposed bank facility to refinance its existing debt, including the holdco PIK notes. The Ba2 rating on the existing senior secured debt and B2 rating on the existing senior unsecured debt will be withdrawn when the transaction closes. The rating outlook has been revised to stable from positive. All ratings are subject to the execution of the transaction as currently proposed and Moody's review of final documentation. Ratings upgraded: Corporate Family Rating to B2 from B3 Probability of Default Rating to B2-PD from B3-PD Ratings upgraded and to be withdrawn upon completion of the refinancing: $50 million senior secured revolving credit facility due 2015 to Ba2 (LGD2) from Ba3 (LGD2) $148 million senior secured term loan due 2016 to Ba2 (LGD2) from Ba3 (LGD2) $200 million senior unsecured notes due 2018 to B2 (LGD4) from B3 (LGD4) Rating assigned: $50 million senior secured 5-year revolver at B2 (LGD3) $530 million senior secured 6-year term loan at B2 (LGD3) Speculative Grade Liquidity rating at SGL-2 Ratings Rationale The upgrade reflects the company's improved operating performance, higher earnings and positive same store sales growth which have helped improve the company's leverage and coverage metrics. The upgrade also reflects D&B's announcement that it intends to refinance its current capital structure -- including approximately $150 million of holdco PIK notes -- with lower cost debt and its improved liquidity profile expected to result from the proposed transaction. D&B's existing revolver is due to expire in less than one year (June 2015) while the proposed revolver expires in 2019. D&B is planning on raising $580 million in senior secured bank facilities, including a $50 million 5-year senior secured revolver and $530 million 6-year senior secured term loan. The proceeds from the proposed facilities will be used to refinance the company's existing debt balances, add cash to the balance sheet, and pay fees and expenses. The proposed refinancing is expected to materially lower the company's cost of debt, extend its debt maturity profile, and facilitate further debt reduction, all positives which support the rating upgrade. Debt reduction is expected from the approximate $5 million in annual cash interest savings and the elimination of the PIK feature in the existing holdco discount notes that added approximately $15 million of incremental debt per year. D&B's same store sales have outpaced its peers with positive results in seven of the last nine quarters. This has helped the company improve its operating profit about 30% to $57 million for the LTM period ended May 4, 2014 from $44 million at the end of fiscal 2012. Pro forma for the proposed transaction, debt/EBITDA and EBITA/interest are estimated to be 5.4 times and about 2.0 times, respectively (metrics are adjusted for Moody's standard adjustments and does not include add backs for stock based compensation expense or management fees). The B2 rating on the proposed senior secured bank facility, the same as the CFR, reflects the fact that it will make up the preponderance of the capital structure. A 50% family recovery rate was used due to the fact that the credit agreement is considered covenant lite, there is expected to only be a springing leverage covenant on the revolver based on utilization. The senior secured bank facility is expected to have guarantees from subsidiaries and a first-lien interest in the company's assets. D&B's SGL-2 reflects its good liquidity profile. Moody's expects over the next 12 to 18 months the company will generate sufficient free cash flow to cover its interest expense, required amortization and all capex while maintaining cash balances of around $50 million. Assuming the transaction closes, D&B will have a $50 million revolver in place that expires in 5 years. Moody's does not expect the revolver will be utilized. If the transaction does not close, D&B's external liquidity will be a constraint on its liquidity profile as its current revolver expires in less than 1 year (June 2015). D&B's stable rating outlook reflects Moody's expectations that the company's earnings will continue to grow over the next 12 to 18 months as it grows the number of new/remodeled stores and maintains positive same store sales, so that debt/EBITDA and EBITA/interest expense will approximate 5.0 times and 2.0 times, respectively. The stable rating outlook also includes Moody's expectation that D&B will maintain a good liquidity profile during a period where it plans to ramp up spending on new/remodeled stores. D&B's ratings could be upgraded if the company maintains positive same store sales growth, maintains good returns on new store openings and is able to sustain debt/EBITDA below 5.0 times and EBITA/cash interest expense above 2.25 times. Ratings could be downgraded if D&B's operating results or liquidity weakened, if the company experiences a period of negative same store sales growth, or if debt/EBITDA rises to above 6.0 times or EBITA/interest expense dropped below 1.5 times. The principal methodology used in this rating was the Global Restaurant Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Dallas, Texas, Dave & Buster's, Inc. is a leading operator of large format, high volume specialty restaurant- entertainment complexes. The company operates under the Dave & Buster's and Dave & Buster's Grand Sports Caf' brand names and as of June 1, 2014, owns 69 stores in the United States and Canada. Revenues for the last twelve months ended May 4, 2014 were approximately $660 million. The company is majority-owned by private equity firm Oak Hill Capital Partners through a leveraged buyout transaction completed in May 2010. DAYBREAK OIL: Incurs $257,000 Net Loss in May 31 Quarter -------------------------------------------------------- Daybreak Oil and Gas, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $257,659 on $810,429 of oil and gas sales for the three months ended May 31, 2014, as compared with a net loss of $645,670 on $228,604 of oil and gas sales for the same period in 2013. The Company's balance sheet at May 31, 2014, showed $12.94 million in total assets, $16 million in total liabilities and a $3.05 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/ZDNB1i About Daybreak Oil Daybreak Oil and Gas, Inc. is an independent oil and natural gas exploration, development and production company. The Company is headquartered in Spokane, Washington and has an operations office in Friendswood, Texas. The Company's common stock is quoted on the OTC Bulletin Board market under the symbol DBRM.OB. Daybreak has over 20,000 acres under lease in the San Joaquin Valley of California. Daybreak Oil incurred a net loss available to common shareholders of $1.54 million for the year ended Feb. 28, 2014, as compared with a net loss available to common shareholders of $2.39 million for the same period last year. Daybreak Oil incurred a net loss of $2.23 million on $974,680 of revenue for the year ended Feb. 28, 2013, as compared with a net loss of $1.43 million on $1.31 million of revenue for the year ended Feb. 29, 2012. MaloneBailey, LLP, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Feb. 28, 2014. The independent auditors noted that Daybreak Oil and Gas, Inc. suffered losses from operations and has negative operating cash flows, which raises substantial doubt about its ability to continue as a going concern. DETROIT, MI: City Entitled to Casinos Revenues, Judge Rules ----------------------------------------------------------- Mary Williams Walsh, writing for writing for The New York Times' DealBook, reported that a federal judge ruled that Detroit was entitled to casino revenue worth about $15 million a month and could use the money to settle its debts in bankruptcy, rejecting arguments from a bond insurer that the money was beyond the city's reach. According to the report, the insurer, Syncora Guarantee, said it would appeal the decision quickly to the United States Court of Appeals for the Sixth Circuit so the matter could be resolved before Detroit starts seeking court approval of its bankruptcy- exit plan in mid-August. An appeals court ruling in Syncora's favor could reduce the pot of money that Detroit proposes to distribute to its many creditors, and that, in turn, could disrupt Detroit's planned exit from bankruptcy, the report related. Also, Detroit's bankruptcy judge, Steven Rhodes, asked the United States attorney general, Eric H. Holder Jr., to provide a brief on whether Chapter 9 bankruptcy is unconstitutional if it impairs the claims of property owners whose land has been seized under eminent domain, or the demands for compensation of people injured in confrontations with the police, the DealBook said. About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. DEWEY & LEBOEUF: NY Prosecutor Asks Judge to Halt Civil Suit ------------------------------------------------------------ Sara Randazzo, writing for The Wall Street Journal, reported that Manhattan prosecutors pursuing criminal charges against former leaders of the law firm Dewey & LeBoeuf LLP asked a bankruptcy court judge to slow down a civil case against two of the defendants. According to the report, in a request filed in U.S. Bankruptcy Court in Manhattan, assistant district attorney Steve Pilnyak requested all discovery to stop in a suit brought against Dewey's ex-chief financial officer, Joel Sanders, and former executive director, Stephen DiCarmine. The civil suit seeks more than $21.8 million that Dewey's trustee says the pair improperly received as the firm "fell deeper and deeper into insolvency" ahead of its 2012 collapse, the Journal related. Attorneys for Messrs. DiCarmine and Sanders have also asked U.S. Bankruptcy Judge Martin Glenn to halt the suit, over the objections of Dewey's trustee, in light of the criminal action, the Journal said. About Dewey & LeBoeuf Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the wind-down of its operations. The firm had struggled with high debt and partner defections. Dewey disclosed debt of $245 million and assets of $193 million in its chapter 11 filing late evening on May 29, 2012. Dewey & LeBoeuf LLP operated as a prestigious, New York City- based, law firm that traced its roots to the 2007 merger of Dewey Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in 1929. In recent years, more than 1,400 lawyers worked at the firm in numerous domestic and foreign offices. At its peak, Dewey employed about 2,000 people with 1,300 lawyers in 25 offices across the globe. When it filed for bankruptcy, only 150 employees were left to complete the wind-down of the business. Dewey's offices in Hong Kong and Beijing are being wound down. The partners of the separate partnership in England are in process of winding down the business in London and Paris, and administration proceedings in England were commenced May 28. All lawyers in the Madrid and Brussels offices have departed. Nearly all of the lawyers and staff of the Frankfurt office have departed, and the remaining personnel are preparing for the closure. The firm's office in Sao Paulo, Brazil, is being prepared for closure and the liquidation of the firm's local affiliate. The partners of the firm in the Johannesburg office, South Africa, are planning to wind down the practice. The firm's ownership interest in its practice in Warsaw, Poland, was sold to the firm of Greenberg Traurig PA on May 11 for $6 million. The Pension Benefit Guaranty Corp. took $2 million of the proceeds as part of a settlement. Judge Martin Glenn oversees the case. Albert Togut, Esq., at Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The petition was signed by Jonathan A. Mitchell, chief restructuring officer. JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the lenders under the Revolver Agreement, hired Kramer Levin Naftalis & Frankel LLP. JPMorgan, as Collateral Agent for the Revolver Lenders and the Noteholders, hired FTI Consulting and Gulf Atlantic Capital, as financial advisors. The Noteholders hired Bingham McCutchen LLP as counsel. The U.S. Trustee formed two committees -- one to represent unsecured creditors and the second to represent former Dewey partners. The creditors committee hired Brown Rudnick LLP led by Edward S. Weisfelner, Esq., as counsel. The Former Partners hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel. FTI Consulting, Inc. was appointed secured lender trustee for the Secured Lender Trust. Alan Jacobs of AMJ Advisors LLC, was named Dewey's liquidation trustee. Scott E. Ratner, Esq., Frank A. Oswald, Esq., David A. Paul, Esq., Steven S. Flores, Esq., at Togut, Segal & Segal LLP, serve as counsel to the Liquidation Trustee. Dewey's liquidating Chapter 11 plan was approved by the bankruptcy court in February 2013 and implemented in March. The plan created a trust to collect and distribute remaining assets. The firm estimated that midpoint recoveries for secured and unsecured creditors under the plan would be 58.4 percent and 9.1 percent, respectively. DIGITAL CONSULTING: 1st Cir. Rules in Schussel Tax Appeal --------------------------------------------------------- George Schussel appeals a decision of the United States Tax Court holding him liable, as the recipient of a fraudulent transfer from his former company, for the company's back taxes (including penalties) of over $4.9 million, plus interest of at least $8.7 million. On appeal, he does not dispute that his company fraudulently transferred millions of dollars to him in an effort to avoid paying income taxes to the IRS. What he disputes is how much he owes the IRS as a result of those transfers: 1. he argues that the tax court erred in applying the federal tax interest statute, and that he should only have to pay the likely much lower amount of prejudgment interest that would be due under Massachusetts law. 2. he claims that the tax court should have accepted his corrected tax returns as establishing the amount of the assets he misappropriated. 3. he maintains that he should have received credit for money he loaned back to his company, which the company then used to pay his legal bills. Beginning in the early 1980s, Schussel operated a Massachusetts corporation called Digital Consulting, Inc. Until 1996, DCI was a subchapter C corporation. During the relevant period, Schussel controlled 95% of DCI. Schussel set up an offshore shell company to siphon DCI income into accounts that he controlled, all without paying the requisite corporate or individual taxes. DCI failed to report all of its income to the IRS, and eventually, the IRS issued a notice of deficiency regarding DCI's 1993, 1994, and 1995 tax returns. DCI neither contested nor paid the assessed liabilities. It has been insolvent since 2004. "Concluding that the tax court calculated prejudgment interest under the wrong statute, we affirm in part, reverse in part, and remand for further proceedings," the United States Court of Appeals for the First Circuit ruled in a July 8, 2014 decision available at http://is.gd/OYMVhxfrom Leagle.com. The case is, GEORGE SCHUSSEL, Transferee, Petitioner, Appellant, v. DANIEL I. WERFEL, Acting Commissioner of the Internal Revenue Service, Respondent, Appellee, No. 13-1717 (1st Cir.). DIOCESE OF GALLUP: Creditors May Probe Corpus Christi Diocese ------------------------------------------------------------- Bankruptcy Judge David T. Thuma in New Mexico granted the request of the Official Committee of Unsecured Creditors appointed in the Chapter 11 case of Roman Catholic Church of the Diocese of Gallup, to conduct a Rule 2004 examination of the Roman Catholic Diocese of Corpus Christi. The Debtor is the defendant in sexual abuse litigation related to eight claims of childhood sexual abuse perpetrated by Fr. Clement A. Hageman. The Debtor has admitted that there are credible allegations of sexual abuse by Fr. Hageman. Fr. Hageman was ordained in 1930 for the Diocese of Corpus Christi. He entered the Diocese of Gallup and served in various capacities in parishes and missions of the Diocese of Gallup from approximately 1940 until his death in 1975. The Committee asserts the Debtor has causes of action against DCC arising from its nondisclosure of information regarding Fr. Hageman, including but not limited to claims for contribution, indemnity, negligent nondisclosure, negligent misrepresentation, and fraud. For its part, the Debtor states it would use any funds recovered from DCC to help fund a plan of reorganization. The UCC's proposed examination pursuant to Fed.R.Bankr.P. 2004 seeks to discover DCC's financial resources to pay claims against it, i.e. 10 years of financial statements and detailed information about potential insurance coverage. The proposed examination also seeks financial and insurance information about six allegedly affiliated entities: Catholic Charities and Mother Teresa Shelter; Diocese of Corpus Christi Deposit & Loan Fund, Inc.; Diocesan Telecommunications, Inc.; Diocese of Corpus Christi Perpetual Benefit Endowment Fund, Inc.; and Villa Maria of Corpus Christi, Inc. A copy of the Court's July 8, 2014 Memorandum Opinion is available at http://is.gd/aztg5mfrom Leagle.com. About the Diocese of Gallup, NM The Diocese of Gallup, New Mexico, principally encompasses American Indian reservations for seven tribes in northwestern New Mexico and northeastern Arizona. It is the poorest diocese in the U.S. There are 38 active priests working in the Diocese and 27 permanent deacons also serve the Diocese along with five seminarians. The Diocese and its missions, schools and ministries employ approximately 50 people, and a significant number of additional people offer their services as volunteers. The diocese sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.M. Case No. 13-bk-13676) on Nov. 12, 2013, in Albuquerque, New Mexico amid suits for sexual abuse committed by priests. The bishop previously said bankruptcy will be "the most merciful and equitable way for the diocese to address its responsibility." The abuse mostly occurred in the 1950s and early 1960s, the bishop said. The petition shows assets and debt both less than $1 million. The Diocese of Gallup is the ninth Catholic diocese to seek protection in Chapter 11 bankruptcy. The Official Committee of Unsecured Creditors appointed in the case is represented by: James I. Stang, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Boulevard, 13th Floor Los Angeles, CA 90067 Tel: (310) 277-6910 Fax: (310) 201-0760 Email: jstang@pszjlaw.com DMW MARINE: Court Narrows Trustee's Suit v. Weidner et al. ---------------------------------------------------------- Michael H. Kaliner, the chapter 7 trustee for DMW Marine, LLC, commenced an adversary proceeding on May 16, 2013, by filing a complaint against DMW Marine LLC (DE), DMW Marine Group, LLC, and Douglas M. Weidner. The Complaint asserts six claims for relief: (1) Count I: Successor Liability under 28 U.S.C. Sec. 2201 (2) Count II: Actual Fraud under 11 U.S.C. Sections 548(a)(1)(A) and 544(b)(1); 12 Pa.C.S. Sec. 5104(a) (3) Count III: Constructive Fraud under 11 U.S.C. Sections 548(a)(1)(B) and 544(b)(1); 12 Pa.C.S. Sections 5104(b) and 5105 (4) Count IV: Post-Petition Transfers under 11 U.S.C. Sec. 549 (5) Count V: Recovery of Transfers under 11 U.S.C. Sec. 550 (6) Count VI: Trademark and Copyright Infringement The Defendants filed a motion for summary judgment and supporting brief on February 27, 2014, to which the Trustee filed a response on March 28, 2014. Bankruptcy Judge Eric L. Frank for the Eastern District of Pennsylvania ruled that: (1) The Motion is granted, in part, and denied, in part. (2) As to Count I for Successor Liability, the Motion is denied. (3) As to Count II for fraudulent transfers made with actual fraudulent intent pursuant to 11 U.S.C. Sections 548(a)(1)(A) and 544(b)(1), and 12 Pa.C.S.A. Sec. 5104(a), the Motion is denied. (4) As to Count III for fraudulent transfers made with constructively fraudulent intent pursuant to 11 U.S.C. Secs. 548(a)(1)(B) and 544(b)(1), and 12 Pa.C.S. Secs. 5104(b) and 5105, the Motion is denied. (5) As to Count IV for post-petition transfers pursuant to 11 U.S.C. Sec. 549, the Motion is denied. (6) As to Count V for recovery of avoided transfers pursuant to 11 U.S.C. Sec. 550, the Motion is denied. (7) As to Count VI: (a) on the Trustee's claim for Trademark Infringement, the Motion is granted; (b) on the Trustee's claim for Copyright Infringement, the Motion is granted; (c) Judgment is entered on Count VI in favor of the Defendants and against the Trustee. The case is, MICHAEL H. KALINER, Trustee of the Estate of DMW Marine, LLC, Plaintiff, v. DMW MARINE, LLC (DE), DMW MARINE GROUP, LLC, and DOUGLAS M. WEIDNER, Defendants, Adv. Proc. No. 13-0292 (Bankr. E.D. Pa.). A copy of the Court's July 10, 2014 Order is available at http://is.gd/52GW91from Leagle.com. About DMW Marine DMW Marine, LLC, based in Exton, PA, filed for Chapter 11 bankruptcy (Bankr. E.D. Pa. Case No. 11-13953) on May 17, 2011. Judge Jean K. FitzSimon presides over the case. Charles M. Golden, Esq., at Obermayer Rebmann Maxwell & Hippel LLP, served as the Debtor's counsel. DMW Marine estimated $100,001 to $500,000 in assets and under $10 million in debts. A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at: http://bankrupt.com/misc/paeb11-13953.pdf The petition was signed by Michael Antonoplos, receiver. Affiliate, Douglas M. Weidner filed a Chapter 11 petition (Case No. 10-31034) on Dec. 23, 2010. DMW Marine's case was later converted to Chapter 7 and Michael H. Kaliner was named Chapter 7 Trustee. DUPONT FABROS: S&P Revises Outlook to Stable & Affirms 'BB-' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its ratings outlook on Washington, D.C.-based DuPont Fabros Technology Inc. and its subsidiary, DuPont Fabros Technology L.P. (collectively, DuPont Fabros or DFT), to stable from positive. At the same time, S&P affirmed its 'BB-' corporate credit ratings on both entities. S&P also affirmed its 'BB' issue rating on the company's senior unsecured notes due 2021; the recovery rating on this debt remains '2'. "The revision of our rating outlook on DuPont Fabros to stable from positive reflects our reassessment of the significance of its high tenant and asset base concentration," said Standard & Poor's credit analyst Scott Sprinzen. S&P also believes there is limited room for better pricing in the data center space as compared to our previous expectations. S&P considers that stronger competition in the industry from in-house data centers will constrain DFT's ability to increase rental prices in the next few years. S&P do not believe that DFT will face a steep pricing decline given that its average lease term is close to seven years; however, S&P believes that it will gradually adjust its rental rates to remain competitive. S&P is affirming its ratings on DFT based on the company's "weak" business risk profile and "significant" financial risk profiles (as S&P's criteria define those terms). DuPont Fabros' asset base is relatively small compared with other U.S. REITs S&P rates, as its net income-producing properties had a book value of $2.1 billion as of March 31, 2014. Its current operational properties consist of 10 state-of-the-art data centers (2.6 million gross square feet) in four key markets: seven in northern Virginia, one in northern New Jersey, one in Chicago, and one in northern California. Although DFT shows high asset concentration in the northern Virginia market, the concentration is somewhat mitigated by that area's position as the fastest- growing market for wholesale data centers because of its comparatively low labor costs and tax incentives. S&P expects DuPont Fabros' will maintain a strong focus on this location because it will likely develop the bulk of its backlog there. The stable outlook reflects S&P's expectation that DuPont Fabros will maintain high- to mid-single-digit revenue growth and capacity utilization above 90%, with the completion and stabilization of properties under development. S&P expects adjusted debt to EBITDA will remain within the 5x to 6x range and FCC of about 3.5x to 3.7x over the next couple of years. Although unlikely in the next couple of years, if DuPont Fabros ultimately achieves greater tenant and geographic diversity, S&P could reassess the company's business risk position and consider a rating upgrade. Also, significant deleveraging, with debt to EBITDA (including preferred stock as debt) below 4.5x and FCC consistently above 3.1x could lead to a positive rating action. Increased vacancy rates (for example, owing to major tenant defections) or more-significant-than-anticipated pressure on rental rates, impinging on DuPont's financial performance, could lead to a downgrade. Likewise, a downgrade could occur if the company were to adopt an aggressive debt-financed acquisition strategy such that adjusted debt to EBITDA increases above 9.5x. DUTCH GOLD: Unit Buys '524 Patent From Tetra Micro -------------------------------------------------- Dutch Gold Resources, Inc., through its subsidiary, Ascendant Analytics, Inc., on July 10, 2014, completed an agreement with Tetra Micro Labs, Inc., to acquire the Provision Patent 61/977,524 for a combination of cash and stock. Pursuant to the Agreement, Ascendant will pay 25 million shares of restricted common stock in Dutch Gold to Tetra Micro. Ascendant will grant the seller an ongoing royalty on the sale of products in the amount of 7.5 percent of the net income of the sales generated by that patent for the life of the product. Ascendant will also pay Tetra Micro $60,000. The agreement is available for free at http://is.gd/CZsbUV About Dutch Gold Based in Atlanta, Ga., Dutch Gold Resources, Inc. (OTC: DGRI) -- http://www.dutchgoldresources.com/-- is a junior gold miner focused on developing its existing mining properties in North America and acquiring and developing new mines that can enter into production in 12 to 24 months. After auditing the 2011 results, Hancock Askew & Co., LLP, in Norcross, Georgia, noted that the Company has limited liquidity and has incurred recurring losses from operations and other conditions exist which raise substantial doubt about the Company's ability to continue as a going concern. The Company reported a net loss of $4.58 million on $0 of sales in 2011, compared with a net loss of $3.69 million on $0 of revenue in 2010. The Company's balance sheet at Sept. 30, 2012, showed $2.65 million in total assets, $7.17 million in total liabilities and a $2.23 million total stockholders' deficit. EDRA BLIXSETH: Court Okays Disbursement of Funds ------------------------------------------------ Bankruptcy Judge Ralph B. Kirscher granted the motion of Richard Samson, the Chapter 7 Trustee of the estate of Edra D. Blixseth, for approval of disbursement of funds. The Chapter 7 Trustee filed the motion on May 15, and the Bankruptcy Court held a hearing on July 8. According to Judge Kirscher, Mr. Samson is authorized to disburse the funds now held in Datsopoulos, MacDonald & Lind, P.C.'s trust account as follows: Edra D. Blixseth (81.63%) $15,481.53 Yellowstone Mountain Club, LLC (11.73%) $2,224.65 Yellow Sign, Inc. (3.06%) $580.35 Prim1988 Revocable Trust (1.53%) $290.17 CB Sunrise Capital, LLC (1.02%) $193.45 Rogers Investment Partners, LP (0.515%) $97.67 MJD Partners, L.P. (0.515%) $97.67 ---------- Total $18,965.49 The Court overruled the objection of Western Capital Partners, LLC, to the Chapter 7 Trustee's motion. The Court held that Western Capital's argument that Mr. Samson has violated the terms of the order confirming Western Capital's Amended Plan of Reorganization is not necessary. That argument is meritless, the judge said. A copy of the Court's July 10, 2014 Memorandum of Decision is available at http://is.gd/a2ijHhfrom Leagle.com. About Western Capital Western Capital Partners LLC filed a Chapter 11 petition (Bankr. D. Col. Case No. 13-15760) in Denver on April 10, 2013. The Englewood-based company estimated assets and debt of $10 million to $50 million. Judge Michael E. Romero presides over the case. The Debtor is represented by Jeffrey A. Weinman, Esq., at Weinman & Associates, P.C. Eason Rohde, LLC, is litigation counsel to the Debtor. Strauss & Malk, LLP, is also litigation counsel to the Debtor pertaining to a foreclosure case in the Circuit Court of Cook County, Illinois. About Edra D. Blixseth Edra D. Blixseth owns the Porcupine Creek Golf Club in Rancho Mirage and the Yellowstone Club in Montana. Ms. Blixseth filed for Chapter 11 bankruptcy protection on March 26, 2009 (Bankr. D. Mont. Case No. 09-60452). Gary S. Deschenes, Esq., at Deschenes & Sullivan Law Offices assists Ms. Blixseth in her restructuring efforts. The Debtor estimated $100 million to $500 million in assets and $500 million to $1 billion in debts. The Debtor's case was converted from a Chapter 11 to a Chapter 7 by Court order entered May 29, 2009. ELBIT IMAGING: Annual Shareholders' Meeting Set on August 14 ------------------------------------------------------------ Elbit Imaging Ltd. has scheduled its 2014 annual shareholders meeting to take place Thursday, Aug. 14, 2014, at 11:00 a.m. (Israel time), at the offices of the Company, located at 5 Kinneret Street, Bnei Brak, Israel. The record date for the meeting is July 15, 2014. The agenda of the meeting are as follows: 1. To re-elect the following members of the Company's Board of Directors: Alon Bachar, Eliezer Avraham Brender, Ron Hadassi, Shlomi Kelsi, Yoav Kfir, Boaz Lifschitz and Nadav Livni; 2. To authorize the Company's Board of Directors to effect a reverse share split of all of the Company's ordinary shares, no par value, at a ratio not to exceed one-for-twenty, and to approve related amendments to our Memorandum and Articles of Association; 3. To approve for Mr. Ron Hadassi to serve as the Company's Chairman of the Board and acting Chief Executive Officer until no later than March 31, 2015; 4. To approve a compensation policy for the Company's directors and officers; 5. To approve the compensation for the Company's Chairman, Mr. Ron Hadassi; 6. To approve a Consultancy Agreement with the Company's Director, Mr. Boaz Lifschitz; 7. To approve compensation for the Company's non-external directors; 8. To re-appoint Brightman Almagor Zohar & Co., a member of Deloitte, as the Company's independent auditors until the next annual general meeting of shareholders; and 9. To discuss the Company's financial statements for the years ended Dec. 31, 2012, and 2013 About Elbit Imaging Ltd. Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) hold investments in real estate and medical companies. The Company, through its subsidiaries, also develops shopping and entertainment centers in Central Europe and invests in and manages hotels. Since February 2013, Elbit has intensively endeavored to come to an arrangement with its creditors. Elbit has said it has been hanging by a thread for more than five months. It has encountered cash flow difficulties and this burdens its day to day activities, and it certainly cannot make the necessary investments to improve its assets. In light of the arrangement proceedings, and according to the demands of most of the bondholders, as well as an agreement that was signed on March 19, 2013, between Elbit and the Trustees of six out of eight series of bonds, Elbit is prohibited, inter alia, from paying off its debts to the financial creditors - - and as a result a petition to liquidate Elbit was filed, and Bank Hapoalim has declared its debts immediately payable, threatening to realize pledges that were given to the Bank on material assets of the Company -- and Elbit undertook not to sell material assets of the Company and not to perform any transaction that is not during its ordinary course of business without giving an advance notice to the trustees. Accountant Rony Elroy has been appointed as expert for examining the debt arrangement in the Company. In July 2013, Elbit Imaging's controlling shareholders, Europe- Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company that the Tel Aviv District Court has appointed Adv. Giroa Erdinast as a receiver with regards to the ordinary shares of the Company held by Europe Israel securing Europe Israel's obligations under its loan agreement with Bank Hapoalim B.M. The judgment stated that the Receiver is not authorized to sell the Company's shares at this stage. Following a request of Europe-Israel, the Court also delayed any action to be taken with regards to the sale of those shares for a period of 60 days. Europe Israel and Mr. Zisser have also notified the Company that they utterly reject the Bank's claims and intend to appeal the Court's ruling. Elbit Imaging reported a loss of NIS1.56 billion on NIS360.59 million of total revenues for the year ended Dec. 31, 2013, as compared with a loss of NIS483.98 million on NIS418.48 million of total revenues in 2012. The Company's balance sheet at Dec. 31, 2013, showed NIS4.56 billion in total assets, NIS4.97 billion in total liabilities and a NIS408.63 million shareholders' deficit. Brightman Almagor Zohar & Co., a member firm of Deloitte Touche Tohmatsu, in Tel-Aviv, Israel, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. ELBIT IMAGING: Dutch Court OKs Debt Restructuring Plan of Unit -------------------------------------------------------------- Elbit Imaging Ltd. said that Plaza Centers N.V.'s restructuring plan had been confirmed by the Dutch Court. This follows Plaza Centers receiving approval from 92% of creditors voting in favor of the Plan. The Plan together with a prospectus detailing the proposed amendments to the terms of the Israeli Series A and Series B bonds, as well as other provisions applicable to the relevant creditors, is available to view on the Plaza's Web site at: www.plazacenters.com Elbit Imaging holds directly and indirectly approximately 62.5% of the outstanding shares of Plaza Centers. Annual Meeting on August 14 Elbit Imaging has scheduled its 2014 annual shareholders meeting to take place Thursday, Aug. 14, 2014, at 11:00 a.m. (Israel time), at the offices of the Company, located at 5 Kinneret Street, Bnei Brak, Israel. The record date for the meeting is July 15, 2014. Proxy statements describing the proposals on the agenda and proxy cards for use by shareholders that cannot attend the meeting in person will be sent by mail, on or about July 18, 2014, to the Company's shareholders of record and to shareholders that hold shares registered with the American Stock Transfer & Trust Company. The agenda of the meeting is as follows: 1. To re-elect the following members of the Company's Board of Directors: Alon Bachar, Eliezer Avraham Brender, Ron Hadassi, Shlomi Kelsi, Yoav Kfir, Boaz Lifschitz and Nadav Livni; 2. To authorize the Company's Board of Directors to effect a reverse share split of all of the Company's ordinary shares, no par value at a ratio not to exceed one-for-twenty, and to approve related amendments to the Company's Memorandum and Articles of Association; 3. To approve for Mr. Ron Hadassi to serve as the Company's Chairman of the Board and acting chief executive officer until no later than March 31, 2015; 4. To approve a compensation policy for the Company's directors and officers; 5. To approve the compensation for the Company's Chairman, Mr. Ron Hadassi; 6. To approve a Consultancy Agreement with the Company's Director, Mr. Boaz Lifschitz; 7. To approve compensation for the Company's non-external directors; 8. To re-appoint Brightman Almagor Zohar & Co., a member of Deloitte, as the Company's independent auditors until the next annual general meeting of shareholders; and 9. To discuss the Company's financial statements for the years ended Dec. 31, 2012 and 2013. About Elbit Imaging Ltd. Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) hold investments in real estate and medical companies. The Company, through its subsidiaries, also develops shopping and entertainment centers in Central Europe and invests in and manages hotels. Since February 2013, Elbit has intensively endeavored to come to an arrangement with its creditors. Elbit has said it has been hanging by a thread for more than five months. It has encountered cash flow difficulties and this burdens its day to day activities, and it certainly cannot make the necessary investments to improve its assets. In light of the arrangement proceedings, and according to the demands of most of the bondholders, as well as an agreement that was signed on March 19, 2013, between Elbit and the Trustees of six out of eight series of bonds, Elbit is prohibited, inter alia, from paying off its debts to the financial creditors - - and as a result a petition to liquidate Elbit was filed, and Bank Hapoalim has declared its debts immediately payable, threatening to realize pledges that were given to the Bank on material assets of the Company -- and Elbit undertook not to sell material assets of the Company and not to perform any transaction that is not during its ordinary course of business without giving an advance notice to the trustees. Accountant Rony Elroy has been appointed as expert for examining the debt arrangement in the Company. In July 2013, Elbit Imaging's controlling shareholders, Europe- Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company that the Tel Aviv District Court has appointed Adv. Giroa Erdinast as a receiver with regards to the ordinary shares of the Company held by Europe Israel securing Europe Israel's obligations under its loan agreement with Bank Hapoalim B.M. The judgment stated that the Receiver is not authorized to sell the Company's shares at this stage. Following a request of Europe-Israel, the Court also delayed any action to be taken with regards to the sale of those shares for a period of 60 days. Europe Israel and Mr. Zisser have also notified the Company that they utterly reject the Bank's claims and intend to appeal the Court's ruling. Elbit Imaging reported a loss of NIS1.56 billion on NIS360.59 million of total revenues for the year ended Dec. 31, 2013, as compared with a loss of NIS483.98 million on NIS418.48 million of total revenues in 2012. The Company's balance sheet at Dec. 31, 2013, showed NIS4.56 billion in total assets, NIS4.97 billion in total liabilities and a NIS408.63 million shareholders' deficit. Brightman Almagor Zohar & Co., a member firm of Deloitte Touche Tohmatsu, in Tel-Aviv, Israel, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. EMERALD PERFORMANCE: S&P Affirms 'B' CCR; Outlook Stable -------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Emerald Performance Group Holding LLC. The outlook remains stable. At the same time, based on preliminary terms and conditions, S&P assigned a 'B' issue-level rating to subsidiary Emerald Performance Materials LLC's proposed $600 million first-lien credit facilities consisting of a $75 million revolving credit facility and $525 million first-lien term loan. The recovery rating on this debt is '3', indicating S&P's expectation of meaningful recovery (50% to 70%) in the event of payment default. S&P also assigned an issue-level rating of 'CCC+' to the subsidiary's proposed $230 million second-lien term loan. The recovery rating on this debt is '6', indicating S&P's expectation of negligible recovery (0% to 10%) in the event of payment default. "The corporate credit rating reflects our assessment of Emerald's business risk profile as 'fair' and financial risk profile as 'highly leveraged,' under our criteria," said Standard & Poor's credit analyst Pranay Sonalkar. S&P's assessment of Emerald's "fair" business risk profile reflects the company's exposure to some highly cyclical end markets related to autos, tires, and coatings and adhesives, and vulnerability to volatile raw material prices. These weaknesses are partly offset by its respectable positions in niche products, improving EBITDA margins, and good customer and geographic diversity. With annual revenues of about $720 million, Emerald manufactures specialty ingredients and additives such as preservatives, flavors, and fragrances and performance- and flexibility-enhancing modifiers in coatings, composites, and rubber that are important inputs in end-customer applications because they are typically an essential element to the quality of the finished product. Its products are often specified ingredients in customer formulations and products, which offers the company some protection from competitive products. The outlook is stable. Although S&P expects Emerald's credit measures to remain highly leveraged, the improved earnings from recent investments in K-Flex capacity and the company's niche position in key specialty chemicals should support the current rating. S&P expects the company to generate meaningful free cash flow of more than $25 million per year in 2014 and 2015 and use part of this for debt repayment such that FFO to debt improves to around 10% and debt to EBITDA to around 6x by the end of 2015. Although S&P considers an upgrade unlikely, it could raise the ratings slightly if the company's business risk profile improves, possibly as a result of increased operating efficiency or a stronger competitive advantage, and the company was to maintain leverage under 5x through a business cycle. This would also require financial policies that support the higher rating. S&P could lower the rating if unexpected cash outlays or business difficulties significantly reduce the company's liquidity. In addition, S&P could lower the rating if leverage exceeds 7x or the company's free cash flow generation were to turn negative. S&P thinks this could occur if the company's revenues were to decline 2% or if operating margins were to decline by 100 basis points. ENDEAVOUR INTERNATIONAL: BlackRock Lowers Stake to 3.4% ------------------------------------------------------- In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission, BlackRock, Inc., disclosed that as of June 30, 2014, it beneficially owned 1,742,817 shares of common stock of Endeavour International Corp. representing 3.4 percent of the shares outstanding. BlackRock previously owned 4,860,983 common shares at Dec. 31, 2013. A full-text copy of the regulatory filing is available for free at http://is.gd/J61M6q About Endeavour International Houston-based Endeavour International Corporation (NYSE: END) (LSE: ENDV) is an oil and gas exploration and production company focused on the acquisition, exploration and development of energy reserves in the North Sea and the United States. Endeavour International reported net loss of $95.47 million in 2013, a net loss of $126.22 million in 2012 and a net loss of $130.99 million in 2011. As of March 31, 2014, the Company had $1.53 billion in total assets, $1.49 billion in total liabilities, $43.70 million in series C convertible preferred stock and a $5.93 million stockholders' deficit. * * * As reported by the TCR on April 2, 2014, Moody's Investors Service upgraded Endeavour International Corporation's Corporate Family Rating (CFR) to Caa2 from Caa3. "The rating upgrade to Caa2 reflects the recent equity issuance and other first quarter financing transactions that have improved Endeavour International's liquidity" commented Pete Speer, Moody's Vice President. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit rating on Houston, Texas-based Endeavour International Corp. (Endeavour) to 'CCC+' from 'B-'. The rating action reflects S&P's expectation that Endeavour could have insufficient liquidity to meet its needs due to the delay in production from its Rochelle development. EPAZZ INC: IBC Funds Reports 9.9% Equity Stake ---------------------------------------------- In a Schedule 13G filed with the U.S. Securities and Exchange Commission on July 9, 2014, IBC Funds LLC disclosed that it beneficially owned 305,431,372 shares of common stock of Epazz, Inc., representing 9.9 percent of the shares outstanding. The shares of Common Stock were, as of Feb. 14, 2014, the maximum amount of shares of Common Stock that could be owned directly by IBC Funds LLC pursuant to an order entered by the Circuit Court of the Twelfth Judicial Circuit in and for Sarasota County, Florida, approving, among other things, the fairness of the terms and conditions of an exchange pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, in accordance with a settlement agreement and stipulation between the Issuer and IBC in the matter entitled IBC Funds LLC v. EPAZZ, INC. IBC commenced the Action against Epazz on Feb. 12, 2014, to recover $314,021 of past-due accounts payable of the Issuer, which IBC had purchased from vendors of the Issuer pursuant to terms of separate receivable purchase agreements between IBC and those vendors. The Order provides for the full and final settlement of the Claim and the Action. The Settlement Agreement became effective and binding upon Epazz and IBC upon execution of the Order by the Court on the Settlement Date. A full-text copy of the regulatory filing is available at: http://is.gd/f895Cb About EPAZZ Inc. Chicago, Ill.-based EPAZZ, Inc., was incorporated in the State of Illinois on March 23, 2000, to create software to help college students organize their college information and resources. The idea behind the Company was that if the information and resources provided by colleges and universities was better organized and targeted toward each individual, the students would encounter a personal experience with the college or university that could lead to a lifetime relationship with the institution. This concept is already used by business software designed to retain relationships with clients, employees, vendors and partners. Epazz incurred a net loss of $1.90 million on $1.19 million of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $336,862 on $735,972 of revenue for the year ended Dec. 31, 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.19 million in total assets, $2.03 million in total liabilities and a $842,019 total stockholders' deficit. M&K CPAS, PLLC, in Houston, Texas, 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 an accumulated deficit of $(4,114,756) and a working capital deficit of $(681,561), which raises substantial doubt about its ability to continue as a going concern. Bankruptcy Warning "We cannot be certain that any such financing will be available on acceptable terms, or at all, and our failure to raise capital when needed could limit our ability to continue and expand our business. We intend to overcome the circumstances that impact our ability to remain a going concern through a combination of the commencement of additional revenues, of which there can be no assurance, with interim cash flow deficiencies being addressed through additional equity and debt financing. Our ability to obtain additional funding for the remainder of the 2012 year and thereafter will determine our ability to continue as a going concern. There can be no assurances that these plans for additional financing will be successful. Failure to secure additional financing in a timely manner to repay our obligations and supply us sufficient funds to continue our business operations and on favorable terms if and when needed in the future could have a material adverse effect on our financial performance, results of operations and stock price and require us to implement cost reduction initiatives and curtail operations. Furthermore, additional equity financing may be dilutive to the holders of our common stock, and debt financing, if available, may involve restrictive covenants, and strategic relationships, if necessary to raise additional funds, and may require that we relinquish valuable rights. In the event that we are unable to repay our current and long-term obligations as they come due, we could be forced to curtail or abandon our business operations, and/or file for bankruptcy protection; the result of which would likely be that our securities would decline in value and/or become worthless," according to the Company's annual report for the period ended Dec. 31, 2012. EPAZZ INC: IBC Funds No Longer a Shareholder -------------------------------------------- In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission, IBC Funds LLC disclosed that as of May 23, 2014, it ceased to beneficially own any shares of common stock of Epazz Inc. A full-text copy of the regulatory filing is available for free at http://is.gd/29FaK7 About EPAZZ Inc. Chicago, Ill.-based EPAZZ, Inc., was incorporated in the State of Illinois on March 23, 2000, to create software to help college students organize their college information and resources. The idea behind the Company was that if the information and resources provided by colleges and universities was better organized and targeted toward each individual, the students would encounter a personal experience with the college or university that could lead to a lifetime relationship with the institution. This concept is already used by business software designed to retain relationships with clients, employees, vendors and partners. Epazz incurred a net loss of $1.90 million on $1.19 million of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $336,862 on $735,972 of revenue for the year ended Dec. 31, 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.19 million in total assets, $2.03 million in total liabilities and a $842,019 total stockholders' deficit. M&K CPAS, PLLC, in Houston, Texas, 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 an accumulated deficit of $(4,114,756) and a working capital deficit of $(681,561), which raises substantial doubt about its ability to continue as a going concern. Bankruptcy Warning "We cannot be certain that any such financing will be available on acceptable terms, or at all, and our failure to raise capital when needed could limit our ability to continue and expand our business. We intend to overcome the circumstances that impact our ability to remain a going concern through a combination of the commencement of additional revenues, of which there can be no assurance, with interim cash flow deficiencies being addressed through additional equity and debt financing. Our ability to obtain additional funding for the remainder of the 2012 year and thereafter will determine our ability to continue as a going concern. There can be no assurances that these plans for additional financing will be successful. Failure to secure additional financing in a timely manner to repay our obligations and supply us sufficient funds to continue our business operations and on favorable terms if and when needed in the future could have a material adverse effect on our financial performance, results of operations and stock price and require us to implement cost reduction initiatives and curtail operations. Furthermore, additional equity financing may be dilutive to the holders of our common stock, and debt financing, if available, may involve restrictive covenants, and strategic relationships, if necessary to raise additional funds, and may require that we relinquish valuable rights. In the event that we are unable to repay our current and long-term obligations as they come due, we could be forced to curtail or abandon our business operations, and/or file for bankruptcy protection; the result of which would likely be that our securities would decline in value and/or become worthless," according to the Company's annual report for the period ended Dec. 31, 2012. ESSAR STEEL: Moody's Lowers Corporate Family Rating to Ca --------------------------------------------------------- Moody's Investors Service downgraded Essar Steel Algoma's (ESA) corporate family and probability of default ratings to Ca and Ca- PD respectively from Caa1 and Caa1-PD respectively. At the same time, the senior secured ABL term loan was downgraded to Caa1 from B1, the senior secured notes were downgraded to Caa2 from B3, and the senior unsecured notes were downgraded to C from Caa2. The speculative grade liquidity rating remains at SGL - 4. The rating outlook is stable. This completes the review for downgrade initiated on May 30, 2014. Issuer: Essar Steel Algoma Inc. Downgrades: Probability of Default Rating, Downgraded to Ca-PD from Caa1-PD Corporate Family Rating, Downgraded to Ca from Caa1 Senior Secured Bank Credit Facility Sep 20, 2014, Downgraded to Caa1(LGD2) from B1(LGD1) Senior Secured Regular Bond/Debenture Mar 15, 2015, Downgraded to Caa2 (LGD2) from B3(LGD3) Senior Unsecured Regular Bond/Debenture Jun 15, 2015, Downgraded to C(LGD5) from Caa2(LGD5) Outlook Actions: Outlook, Changed To Stable From Rating Under Review Ratings Rationale The downgrade reflects the company's extremely weak liquidity position, high leverage, the election by the company to take advantage of the 30 day grace period for payment of the June 15, 2014 interest installment (now due July 14, 2014), significant debt maturities over the next year, including the September 2014 maturity of the US$350 million ABL term loan facility, and Moody's expectation for meaningful losses on the secured and unsecured debt as part of a restructuring of the capital structure. Blackstone Advisory Partners is assisting ESA in evaluating financing alternatives to improve the company's capital structure. The downgrade also incorporates ESA's challenged operating performance, which Moody's do not expect to materially improve over the next several quarters, notwithstanding some benefit from a more market competitive iron ore supply contract, weak debt protection metrics and high leverage. The company continued in its 2014 fiscal year (ended March 31, 2014) to incur quarterly losses and for the nine months through December 31, 2013 had an operating loss of $114 million (including Moody's standard adjustments -- mostly for pension) and negative EBITDA of roughly $29 million, reflecting relatively weak steel prices realized and a continued higher cost position due to its legacy iron ore supply contract. Moody's expect the company's fourth quarter ended March 31, 2014 will also evidence a loss given the impact of severe winter weather and the inability to ship on the Great Lakes. The Ca corporate family rating also incorporates ESA's single-site location, vulnerability to volatile prices for steel and a continuing only gradual recovery in the overall steel markets, which will, in Moody's view, continue to suppress the degree of upward movement that can be achieved in steel prices. The rating also considers the challenged liquidity position of the company, although ESA obtained financing from external sources as well as its parent to help support its operations during the seasonally difficult winter months. In addition, the company has received funding relief from the Government of Ontario for its defined benefit plan, which sets fixed payments for the next three years and lengthens the amortization period to 2024. Under Moody's loss given default methodology, the Caa1 rating on the ABL term loan reflects its superior position in the capital structure and the expectation of significant recovery given the first priority claim on receivables and inventory. The Caa2 rating on the senior secured notes reflects the weaker security package of this instrument to the ABL term loan. Both the ABL term loan and secured notes benefit from the loss absorption capacity of ESA's unsecured debt, pension obligations and accounts payable. The Ca rating on the senior unsecured notes reflects the subordination of these instruments to a considerable amount of secured debt and the expectation of a considerable loss in value in a default scenario. The stable outlook reflects Moody's expectation that the ESA will be able to accomplish a restructuring of its debt obligations, although losses are likely on certain debt instruments. Headquartered in Sault Ste. Marie, Ontario, Canada, ESA is an integrated steel producer. Approximately 80% to 85% of ESA's sales are sheet products with plate products accounting for the balance. For the 12 months ending December 31, 2013, ESA generated revenues of C$1.8 billion. The principal methodology used in this rating was the Global Steel Industry published in October 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. EL POLLO LOCO: 1st Lien Debt Amendment No Impact on Moody's CFR --------------------------------------------------------------- Moody's Investors Service commented that El Pollo Loco Inc.'s announcement that it intends to amend its first lien credit agreement does not immediately affect its B3 Corporate Family Rating ("CFR") or stable rating outlook as the amendment is contingent upon the company successfully completing an IPO with proceeds of at least $100 million. The company's B3-PD Probability of Default Rating, B1 senior secured first lien rating and Caa2 second lien rating are also unaffected. El Pollo Loco, Inc. ("EPL") headquartered in Costa Mesa, California, is a quick-service restaurant chain specializing in flame-grilled chicken and other Mexican-inspired entrees. The company operated and franchised 401 restaurants primarily around Los Angeles and throughout the Southwestern United States, generating total revenues of approximately $320 million in the last twelve months ended March 26, 2014. El Pollo is owned by two private equity firms, Trimaran Capital Partners and FS Equity Partners. FINJAN HOLDINGS: Daniel Chinn Named Executive Chairman ------------------------------------------------------ The Board of Directors of Finjan Holdings, Inc., appointed Daniel Chinn as executive chairman of the Board of Directors. In light of Mr. Chinn's appointment as executive chairman, the Nominating and Corporate Governance Committee, which was previously comprised of Daniel Chinn and Michael Eisenberg, was reconstituted to consist of Michael Eisenberg and Alex Rogers, each of whom are independent under applicable NASDAQ rules. On July 10, 2014, the Company's President, Philip Hartstein, was appointed president and chief executive officer of the Company, and the Company's chief financial officer, Shimon Steinmetz, was appointed chief financial officer and treasurer. Additional information is available for free at: http://is.gd/rvM6oX Annual Meeting Results The Company held its annual meeting on July 10, 2014, at which the stockholders: (1) elected Eric Benhamou (Class 1), Daniel Chinn (Class 1), Michael Southworth (Class 2), Alex Rogers (Class 2), and Glenn Rogers (Class 2) as directors; 2. ratified the appointment of Marcum LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2014; 3. approved the Finjan Holdings, Inc., 2014 Incentive Compensation Plan; 4. approved amendments to the Company's current certificate of incorporation to (a) decrease the number of authorized shares of common stock from 1 billion to 80 million, (b) provide that the Board consist of between three and fifteen directors and to clarify provisions related to the Company's Board structure, (c) eliminate the ability of holders of the Company's common stock to vote on amendments relating solely to preferred stock, (d) provide for supermajority voting for amendments to bylaws by stockholders, (e) provide for supermajority voting for certain amendments to the charter, (f) provide for supermajority voting to remove directors for cause, (g) permit stockholder action only at a duly called meeting and to prohibit action by written consent of stockholders, (h) provide that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions, and (i) update provisions relating to indemnification and personal liability of directors. 5. approved, on an advisory basis, the compensation paid to the Company's named executive officers; and 6. approved, by an advisory vote, holding a stockholder advisory votes on executive compensation every three years. $100MM Securities Offering Finjan Holdings intends to sell securities with an aggregate offering price of $100 million. The Company's common stock is listed on The NASDAQ Capital Market under the symbol "FNJN." On July 10, 2014, the closing price of the Company's common stock on The NASDAQ Capital Market was $4.10 per share. As of that date, the aggregate market value of the Company's outstanding common stock held by the Company's non-affiliates was approximately $51.5 million. A full-text copy of the Form S-3 is available at: http://is.gd/iO9ZC7 The Company also registered 2,196,836 shares of common stock issuable under the Company's 2014 Incentive Compensation Plan for an aggregate offering price of $9.09 million. A full-text copy of the Form S-8 prospectus is available at http://is.gd/TNevAj About Finjan Finjan, formerly known as Converted Organics, is a leading online security and technology company which owns a portfolio of patents, related to software that proactively detects malicious code and thereby protects end-users from identity and data theft, spyware, malware, phishing, trojans and other online threats. Founded in 1997, Finjan is one of the first companies to develop and patent technology and software that is capable of detecting previously unknown and emerging threats on a real-time, behavior-based basis, in contrast to signature-based methods of intercepting only known threats to computers, which were previously standard in the online security industry. Finjan Holdings reported a net loss of $6.07 million in 2013 following net income of $50.98 million in 2012. The Company reported a net loss of $2 million on $175,000 of revenues for the three months ended March 31, 2014. The Company's balance sheet at March 31, 2014, showed $26.91 million in total assets, $1.55 million in total liabilities and $25.35 million in total stockholders' equity. FIRED UP: Encourages Committee to Work with Other Parties --------------------------------------------------------- Fired Up, Inc., responded to the objection of the Official Committee of Unsecured Creditors to the Debtor's first motion to modify and extend the authority to use cash collateral in the ordinary course, stating that the Committee is encouraged to work with other parties in a manner without consuming the estate. The Committee has objected on the basis that the Debtor's budget is not sufficient to cover all professional fees which the Committee anticipates being incurred and that the Debtor's budget does not include any allocation for the Committee for the months of April, May and June 2014. The Debtor said that its professionals and the Committee's must work together under the same cap; and they will each have an incentive to exercise their fiduciary duty to keep the fees reasonable. The Debtor added that any fees ultimately approved by the Court will be paid as administrative expenses. The amount authorized to be paid on an interim basis is simply an advance upon the fees finally allowed rather than a cap upon the total amount to be paid subject to court approval. As reported in the Troubled Company Reporter on April 7, 2014, Judge Tony M. Davis gave the Debtor interim authority to use cash collateral to pay its usual and necessary operating expenses. All parties with an interest in cash collateral are granted a replacement lien to the same extent, priority and validity as their prepetition liens. FRG Capital, LLC holds a blanket lien upon the Debtor's assets. FRG is controlled by insiders of the Debtor and consents to the use of cash collateral. GE Capital Franchise Corporation has liens upon the Debtor's interest in real and/or personal property at four of its locations. Independent Bank has a lien upon one of Debtor's locations. Prosperity has a lien upon a single location. Xerox has a lien upon an individual piece of equipment. About Fired Up, Inc. Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. The Committee tapped Pachulski Stang Ziehl & Jones LLP as its counsel, and FTI Consulting, Inc. as its financial advisor. FIRED UP: Has Until Oct. 23 to Decide on Real Property Leases ------------------------------------------------------------- The Bankruptcy Court extended until Oct. 23, 2014, Fired Up, Inc.'s time to assume or reject non-residential real property lease agreements. Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. The Committee tapped Pachulski Stang Ziehl & Jones LLP as its counsel, and FTI Consulting, Inc. as its financial advisor. FIRED UP: Taxing Authorities Want to Intervene in Stay Motion ------------------------------------------------------------- Bexar County, Harris County and Tarrant County, Taxing Authorities, ask the Bankruptcy Court for leave to intervene in the motion of GE Capital Franchise Finance Corporation and General Electric Capital Business Asset Funding Corporation of Connecticut for relief from stay in the Chapter 11 case of Fired Up, Inc. The Taxing Authorities are political subdivision of the State of Texas and are authorized to asses, levy and collect ad valorem taxes on property located within their jurisdictions. The Taxing Authorities are creditors of the Debtor and assert that all or part of their claims against the Debtor are secured by a first and superior liens on the property which is the subject of GEFF and GEBAF's motion for relief from stay. Therefore, the Taxing Authorities said they are parties interested in that motion. About Fired Up, Inc. Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. The Committee tapped Pachulski Stang Ziehl & Jones LLP as its counsel, and FTI Consulting, Inc. as its financial advisor. FIRED UP: To Make Adequate Protection Payment to Independent Bank ----------------------------------------------------------------- In the Chapter 11 case of Fired Up Inc., the Bankruptcy Court ordered that the automatic stay provided by Section 362 of the Bankruptcy Code will remain in effect pursuant to an agreement with secured creditor Independent Bank. Independent Bank requested for an order providing adequate protection. The Debtor will make adequate protection payments to Independent Bank pursuant to a Promissory Note dated Dec. 10, 2008, and the Modification and Extension of Note dated Dec. 5, 2011, in the amount of $6,563 beginning Aug. 5, 2014, and maintain the payments on a regular monthly basis as the payments come due. The payments will be applied to the indebtedness on the Note, Modification, and Deed of Trust secured by the real property locally known as 3050 Silverlake Village Drive, Pearland, Texas, and the personal property set forth on the UCC-1 Financing Statement. The Debtors will also, among other things: 1. maintain full-coverage insurance on the collateral of Independent Bank in compliance with the requirements of the Note, Modification, and Deed of Trust, and UCC-1, with Independent Bank named as the designated loss-payee; 2. pay in the ordinary course of business the 2014 ad valorem property taxes when they become due directly to the appraisal district collecting said ad valorem property taxes and will remain current on ad valorem property taxes that become due and payable for each year thereafter. In the event Independent Bank does not receive any payments by the dates, or in the event Debtor converts to Chapter 7, or in the event Debtor fails to maintain insurance or pay ad valorem property taxes on the collateral, Independent Bank may send written notice to the Debtor and Debtor's attorney, and allow the Debtor a 60-day period from the date of such written notice to cure such delinquent payments. In the event the Debtor fails to cure the default within such 60-day period or in the event the Debtor becomes delinquent after two notices of default, the automatic stay will terminate as to Independent Bank without further recourse to the Court, and it will be allowed to take any and all steps necessary to exercise any and all rights it may have in its collateral. Continuance of Hearing on FRG Adequate Protection On June 27, FRG Capital, LLC, filed a second unopposed motion for continuance of the hearing scheduled on July 3, 2014, to Aug. 7, at 1:30 p.m. FRG, the Debtor, and the Unsecured Creditor's Committee request that the matter be reset for hearing in approximately 30 days. FRG Capital is represented by: Blake Rasner, Esq. HALEY & OLSON, P.C. 510 North Valley Mills Drive, Suite 600 Waco, TX 76710 Tel: (254) 776-3336 Fax: (254) 776-6823 E-mail: brasner@haleyolson.com About Fired Up, Inc. Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. The Committee tapped Pachulski Stang Ziehl & Jones LLP as its counsel, and FTI Consulting, Inc. as its financial advisor. FISKER AUTOMOTIVE: Seeks to Pay $750,000 Success Fee to CRO ----------------------------------------------------------- Fisker Automotive Inc., the defunct maker of hybrid autos, filed a motion seeking authority from the U.S. Bankruptcy Court for the District of Delaware to pay its chief restructuring officer a $750,000 success fee on implementation of the liquidating Chapter 11 plan, Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports. If approved, Beilinson Advisory Group LLC will be paid the success fee in addition to monthly fees of $150,000 plus expense reimbursement, Mr. Rochelle said. U.S. Bankruptcy Judge Kevin Gross will convene a hearing on July 28 to consider confirmation of Fisker's liquidation plan. During that hearing, Judge Gross will also rule on Fisker's request for the CRO Success Fee. Moreover, at the July 28 hearing, Judge Gross will hear objections to the plan, including the objection raised by Sven Etzelsberger, representative of the similarly-situated employees who filed a class action alleging that they were terminated without cause in violation of the Workers Adjustment and Retraining Notification Act. The WARN Claimants complain that the Plan impairs them by dissolving their named defendants, and by failing to set aside a special account for the full amount of their priority claim in the event it is allowed. The Official Committee of Unsecured Creditors appointed in the Chapter 11 cases of the estate of Fisker Automotive Holdings, Inc., et al., withdrew, without prejudice, its motion to terminate the Debtors' exclusivity periods to permit it to file a plan of liquidation. The WARN Claimants are represented by Frederick B. Rosner, Esq., Julia Klein, Esq., and Andrew J. Roth-Moore, Esq., at THE ROSNER LAW GROUP LLC, in Wilmington, Delaware; and Jack A. Raisner, Esq., and Rene S. Roupinian, Esq., at OUTTEN & GOLDEN LLP, in New York. About Fisker Automotive Fisker Automotive Holdings, Inc., developer of the Karma plug-in hybrid electric sedan, filed a petition for Chapter 11 protection (Bankr. D. Del. Case No. 13-13087) on Nov. 22, 2013. Fisker estimated assets of more than $100 million and listed debt of $500 million in its bankruptcy petition. The assets include an assembly plant purchased for $21 million from General Motors Corp. The plant never operated. The cars were assembled in Finland. Fisker received a $529 million loan from the Department of Energy's Advanced Technology Vehicles Manufacturing Loan Program and drew down about $192 million before the department froze the loan after Fisker failed to hit several development targets. The company defaulted on its loan in April 2013. Bankruptcy Judge Kevin Gross presides over the case. The Debtors have tapped James H.M. Sprayregen, P.C., Esq., Anup Sathy, P.C., Esq., and Ryan Preston Dahl, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, as co-counsel; Laura Davis Jones, Esq., James E. O'Neill, Esq., and Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, as co-counsel; Beilinson Advisory Group as restructuring advisors; and Rust Consulting/Omni Bankruptcy, as notice and claims agent and administrative advisor. On Nov. 5, 2013, the Official Committee of Unsecured Creditors was appointed. The members are: (a) David M. Cohen; (b) Sven Etzelsberger; (c) Kuster Automotive Door Systems GmbH; (d) Magna E-Car USA, LLC; (e) Supercars & More SRL; and (f) TK Holdings Inc. The Committee is represented by William R. Baldiga, Esq., and Sunni P. Beville, Esq., at Brown Rudnick LLP; and Mark Minuti, Esq., at Saul Ewing LLP. Emerald Capital Advisors Corp. is the financial advisors for the Committee. Fisker sought bankruptcy protection to pursue a private sale of its business to Hybrid Tech Holdings, LLC. The Committee, however, wants a sale public sale, and has identified Wanxiang America Corporation as stalking horse bidder. Hybrid was initially under contract to buy Fisker in exchange for $75 million of the $168.5 million government loan it acquired immediately before the Debtor's Chapter 11 filing. Hybrid later raised its offer by adding an additional $1 million cash and agreeing to share proceeds from the sale of a facility in Delaware it doesn't intend to operate. Hybrid also offered to pay real estate taxes on the Delaware plant. Hybrid also will waive $90 million in deficiency claims that otherwise would dilute unsecured creditors' recovery. Wanxiang, as stalking horse bidder, initially offered $25.8 million in cash. However, Wanxiang has said it has raised its offer by $10 million and is willing to go higher. After the hearings on Jan. 10 and 13, the Court directed a public auction, and capped Hybrid's credit bid to $25 million. In response, Hybrid raised its offer to $55 million. Hybrid is represented by Tobias Keller, Esq., and Peter Benvenutti, Esq., at Keller & Benvenutti LLP, in San Francisco, California. Wanxiang, which bought A123 Systems, Inc., a manufacturer of lithium-ion batteries used in electric vehicles such as the Fisker Karma, in a bankruptcy auction early in 2013 for $256.6 million, is represented in Fisker's case by Sidley Austin LLP's Bojan Guzina, Esq., and Andrew F. O'Neill, Esq.; and Young Conaway Stargatt & Taylor, LLP's Edmon L. Morton, Esq., Robert S. Brady, Esq., and Kenneth J. Enos, Esq. On Feb. 19, 2014, the Bankruptcy Court approved the sale of Fisker's assets to Wanxiang America Corporation. The sale closed on March 24. The sale to Wanxiang is valued at approximately $150 million, Fisker said in a news statement. On March 27, 2014, the Court authorized Fisker Automotive Holdings to change its name to FAH Liquidating Corp. and its affiliate, Fisker Automotive Inc., to FA Liquidating Corp., following the sale. FORCE FUELS: KCG Americas Lowers Equity Stake to Less Than 1% ------------------------------------------------------------- In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission, KCG Americas LLC disclosed that as of June 30, 2014, it beneficially owned 18,958 shares of common stock of Force Fuels, Inc., representing 0.14% based on outstanding shares reported on the issuer's 10-Q/A filed with the SEC for the period ended Oct. 31, 2011. KCG Americas previously held 826,701 common shares at Dec. 31, 2013. A full-text copy of the regulatory filing is available for free at http://is.gd/YMCOU9 About Force Fuels Costa Mesa, Calif.-based Force Fuels, Inc.'s principal business during the period ended Oct. 31, 2011, was the acquisition and management of oil, gas and alternative energy operations. The Company's common shares are currently quoted on the OTC Pink market of OTC Markets Group, Inc. under the trading symbol "FOFU." The Company's balance sheet at Oct. 31, 2011, showed $1.06 million in total assets, $1.42 million in total liabilities, and a stockholders' deficit of $358,092. As reported in the TCR on Dec. 6, 2011, Sadler, Gibb & Associates, LLC, in Salt Lake City, Utah, expressed substantial doubt about Force Fuels' ability to continue as a going concern, following the Company's results for the fiscal year ended July 31, 2011. The independent auditors noted that the Company had accumulated losses of $3.8 million as of July 31, 2011. The Company had notified the SEC regarding the late filing of its quarterly report on Form 10-Q for the period ended Jan. 31, 2012, citing limited accounting staff and incomplete financial statements. The Company has not filed any financial report since the filing of its quarterly report for the period ended Oct. 31, 2011. FULLCIRCLE REGISTRY: Inks $1.5MM Investment Agreement with Kodiak ----------------------------------------------------------------- FullCircle Registry, Inc., on July 9, 2014, entered into a Stock Purchase Agreement and a Registration Rights Agreement with Kodiak Capital Group, LLC, under which Kodiak has agreed to provide the Company with up to $1,500,000 of equity financing following effectiveness of a registration statement on Form S-1. The Company plans to file a registration statement shortly. Under the agreements, at such time as the registration statement is declared effective by the Securities and Exchange Commission, the Company can, from time to time, require Kodiak to purchase shares of its Common Stock for an amount of financing to be determined by the Company, up to an aggregate of $1,500,000, by delivering to Kodiak a notice specifying the amount. The number of shares of Common Stock that Kodiak will purchase pursuant to each notice is determined by dividing the amount set forth in the notice by the purchase price, which is based on a discount from the daily volume weighted average price (VWAP) of the common stock during the five trading days immediately following the date of the Put Notice. There is no minimum amount the Company can specify in a Put Notice at any one time. Pursuant to the Stock Purchase Agreement, Kodiak and its affiliates will not be issued shares of the Company's Common Stock to the extent that issuance would result in its beneficial ownership equaling more than 9.99% of the Company's outstanding Common Stock. On April 30, 2014, as a commitment fee in connection with securing the Stock Purchase Agreement, the Company issued an aggregate of 1,500,000 shares of the Company's Common Stock, restricted in accordance with Rule 144, to Kodiak. The Company believes the issuance was exempt from registration pursuant to Section 4(a) (2) of the Securities Act of 1933. About FullCircle Registry Shelbyville, Kentucky-based FullCircle Registry, Inc., targets the acquisition of small profitable businesses. FullCircle Registry, Inc., has become a holding company with three subsidiaries. They are FullCircle Entertainment, Inc., FullCircle Insurance Agency, Inc. and FullCircle Prescription Services, Inc. Target companies for future acquisition are those in search of exit plans for the owners and are intended to continue autonomous operations as current ownership is phased out over a period of 3-5 years. FullCircle Registry reported a net loss of $448,102 on $1.88 million of revenues for the year ended Dec. 31, 2013, as compared with a net loss of $369,784 on $1.86 million of revenues during the prior year. The Company's balance sheet at March 31, 2014, showed $5.79 million in total assets, $6.03 million in total liabilities and a $238,613 total stockholders' deficit. Rodefer Moss & Co., PLLC, in New Albany, Indiana, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that FullCircle has suffered recurring losses from operations and has a net working capital deficiency that raises substantial doubt about the company's ability to continue as a going concern. FUSION TELECOMMUNICATIONS: Amends 8.4MM Shares Resale Prospectus ---------------------------------------------------------------- Fusion Telecommunications International, Inc., amended its registration statement with the U.S. Securities and Exchange Commission covering 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 Ferentinos Enterprises LLC, Series 4, Donald G Drapkin, Deerwood Associates, LP, Corre Opportunities Qualified Master Fund LP, 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 it may receive proceeds from the exercise of the warrants, if exercised. The Company's common stock is currently quoted on The Nasdaq Capital Market and trades under the symbol "FSNN." On July 7, 2014, the closing price for the Company's common stock was $ 5.40 per share. A full-text copy of the amended prospectus is available at: http://is.gd/mYCWCA 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. GEMINI HDPE: Moody's Assigns Ba2 Rating on $420MM Term Loan ----------------------------------------------------------- Moody's Investors Service has assigned a Ba2 rating to Gemini HDPE LLC's ("Project Gemini" or "Gemini") senior secured credit facilities consisting of a $420 million 7-year Senior Secured Construction/Term Loan B due July 2021. Project Gemini's outlook is stable. Ratings Rationale The Ba2 rating mainly reflects the Completion Agreements and Tolling Guarantees (together, the "Guarantees") from each of INEOS Group Holdings S.A. ("INEOS": B1, Stable) and Sasol Financing (Pty.) Ltd. ("Sasol Financing"), a subsidiary of Sasol Limited ("Sasol": Baa1, Stable), balanced against the high susceptibility of the project's standalone merchant economics to high-density polyethylene (HDPE) margin volatility. While the guarantee from a subsidiary of Sasol Limited, an investment grade rated credit, considerably mitigates the project risk, the several-but-not-joint nature of the guarantees and INEOS' B1 rating limit the extent to which the risk is mitigated. Moreover, while the joint venture will be equally owned, INEOS' role in the project is substantial both from an operational and technology perspective. Moody's also observe that the Gemini project is 50% larger than the largest existing plant using Innovene-S technology and as such, uncertainty exists with regards to Sasol's willingness and/or capability to operate the Innovene-S technology in the event of an INEOS' default. That said, Moody's recognize the strength of the Tolling Agreement and the Guarantees, which together provide significant cash flow predictability. The Ba2 rating further recognizes INEOS' and Sasol's experience building and operating petrochemical manufacturing facilities around the world and the $40 million contingency that is built into the construction budget, albeit the proposed EPC contract is structured on a cost-reimbursable basis. Additionally, the project benefits from the Guarantees, and also from the 42 month Date Certain provision for the completion of construction. Failure to satisfy the Date Certain provision will be deemed an event of default under the Credit Agreement. Moody's believe that the completion risk is at its highest 7 quarters into the construction phase, when proceeds of the entire $420 million credit facility would have been spent against approximately $76 million of equity contributions. However, Moody's views both INEOS and Sasol Financing short to medium term liquidity situation as satisfactory and captured in the Ba2 rating assignment. The strength of the Tolling Agreement is a significantly credit positive factor influencing the Ba2 assessment of the project. INEOS Gemini HDPE Holding Company LLC ("INEOS HoldCo") and Sasol Chemicals North America LLC ("Sasol CNA", and together with INEOS HoldCo, the "Members") individually assume all obligations under the Tolling Agreement as independent contractors. The Tolling Agreement is effective from the closing of the project's financing and the performance and payment obligations under Tolling Agreement are guaranteed by INEOS and Sasol Financing (collectively, the "Guarantors") on a several but not joint basis. The Tolling Agreement is designed such that each Member is responsible to supply half of the raw material (ethylene and 1- hexene) and each Member will receive half of the production output. The toll provides for adjustments in the event that either Member elects not to supply its share of raw material. The right to off-take product is a function of the Member's supply of raw material. The toll fee will be charged to the Members on a monthly basis. As discussed, the toll fee is designed to cover all costs of operating and maintaining the plant including fixed and variable manufacturing costs, sustaining capital cost and debt service. The toll fee payment obligation is absolute and unconditional and not subject to abatement or set-off. Failure to cure the payment default events as described in Section 10 of the Tolling Agreement will result in a default under the Credit Agreement, hence resulting in acceleration of the entire debt outstanding. Given the Amortization Schedule in the Tolling Agreement and the unconditional nature of the Tolling Agreement obligations, the project is required to meet its debt service obligations regardless of the completion of construction. The project benefits from its locational advantage with direct access to ethylene produced from low-cost shale gas feedstock supply via five shale-gas based producer pipelines -- INEOS, Lyondell North, Lyondell South, Shell and Flint Hills. Furthermore, as NGL infrastructure expands, ethane supplies from other shale regions are moving towards the US Gulf Coast. Currently INEOS' Chocolate Bayou facility produces all of the ethylene required to supply for INEOS' share of the Gemini project. Sasol's existing Lake Charles ethylene cracker produces part of Sasol CNA's share for the Gemini project and Sasol CNA will acquire the rest from the market. However, once Sasol's Lake Charles build out is complete (18-24 months after COD of Gemini), Sasol anticipates it will have more than the required ethylene to supply for Gemini's off-take. By integrating into the INEOS' Battleground Manufacturing Complex (BMC complex), the project benefits from shared fixed costs between the existing facilities and the plant through increased management oversight, a reduced implementation timeline, and access to experienced and trained employees. The plant employs INEOS as both the operator and the provider of its proprietary Innovene-S technology, which is used globally by over 10 global chemical companies. As the largest global operator, INEOS has significant expertise operating assets with the Innovene-S technology. However, INEOS' deep expertise, its role in the project and its proprietary technology pose an increased risk to investors in the event of an INEOS' default. The uncertainty around Sasol's willingness -- vis-...-vis it's focus on the Lake Charles facility -- to step in for INEOS' 50% obligations under the Tolling Agreement and Sasol's capability to run a seamless operation in the absence of INEOS are factors that weigh on the rating outcome. The loan terms do not provide for traditional project finance features such as Debt Service Reserve Account (DSRA), Maintenance Reserve Account and excess cash flow sweep. However, the terms of the Tolling Agreement partially mitigate this structural weakness as all of the project costs are borne by the Members. The Debt Component of the Toll Fee amortizes 1% of the principal per year through 2017 and, 13.29% of the principal per annum until the maturity of the loan, amortizing 50% of the principal through the tenor of the loan. However, the absence of DSRA means that the project has no liquidity cushion and instead has to rely on the corporate guarantees for incremental liquidity. That said, under the loan documents, 100% of the proceeds from any new debt issuances, subject to certain customary baskets, are to be applied as mandatory prepayments towards the current credit facility, thereby mitigating the risk of additional debt incurrence. The breakeven analysis on the project's merchant economics demonstrates the project's low level of tolerance to HDPE margin volatility. Moody's breakeven analysis is defined as the contribution margin required to cover the project's Toll Fee and other extraneous costs borne by the Members in relation to the project. The project breaks even with just a 10% reduction in the HDPE margin. Although the trend analysis of 35 year historical HDPE margin data indicates a low likelihood of HDPE margin shrinkage, the sustainability of the project as a standalone entity remains uncertain. In the end, the performance of the Members to honor their obligations under the Tolling Agreement remains very critical to the credit quality of the project and hence their respective credit ratings have a bearing on Gemini's rating. The stable outlook incorporates Moody's view that Gemini is a strategically important project for both INEOS and Sasol, that construction risk is manageable and that once operational, the Members will honor their obligations under the Tolling Agreements. Gemini is unlikely to be upgraded in the near term given its construction period. Over the longer term, positive trends that could positively influence the rating include having successful on-time and within-budget construction completion, strong operational performance and sustained strong HDPE margins. Importantly, measurable improvement in the creditworthiness of the Sponsors could also lead to Gemini's rating upgrade. The rating could face downward pressure if Gemini experiences construction delays and/or budget overruns. Additionally, rating downgrades of Gemini's Guarantors could potentially lead to downward pressure on Gemini's rating. Moody's rating is based upon its current understanding of the proposed terms and conditions of the transaction and is subject to its receipt and review of final documentation being consistent with the proposed terms. The principal methodology used in this rating was Generic Project Finance Methodology published in December 2010. The Gemini project is a wholly-owned subsidiary of INEOS HoldCo, a subsidiary of INEOS, and Sasol CNA, an indirect subsidiary of Sasol Limited. The project is a High-Density Polyethylene (HDPE) manufacturing plant to be constructed and funded through a 50/50 joint venture between INEOS HoldCo and Sasol CNA at INEOS' Battleground Manufacturing Complex in La Porte, TX. INEOS and Sasol will together act as the Sponsors for the project. The project will be capable of producing 470 kilo tons annually (kta), (or 1 billion pounds of HDPE per year) using INEOS Innovene-S technology. The project will have the capability to produce a range of HDPE products, but will focus on premium high-growth bimodal pipe and bimodal film resins. INEOS is the 3rd largest global chemical company by 2013 sales. INEOS consists mainly of three divisions -- Olefins & Polyolefins North America, Olefins & Polyolefins Europe and Chemical Intermediaries. INEOS is headquartered in Switzerland, with 7000 employees globally. It has 28 production sites in 8 countries. INEOS' Olefins & Polyolefins North America is organized as INEOS USA LLC and is INEOS' fastest growing business segment with 2012 sales of $4.7 billion and EBITDA of $1.2 billion. INEOS USA LLC is headquartered in League City, TX with approximately 1000 employees. Sasol Limited (Sasol: Baa1 stable) is an international integrated energy and chemicals company headquartered in Johannesburg, South Africa. Sasol Limited is one of the world's largest producers of synfuels, adding value to coal, natural gas and oil, to produce higher value liquid fuels. Sasol has operations in 37 countries and employs over 34000 people. Sasol Limited is listed on NYSE as well as Johannesburg, with a market capitalization of $32 billion. Sasol Limited is both operationally and geographically diversified, with 12 business divisions, although approximately 49% of revenue and 86% of profit from operations is generated in South Africa. For the Last Twelve Months ended 31 December 2013 Sasol Limited generated revenue of ZAR199.7 billion (USD20.7 billion) and EBITDA of ZAR79.1 billion (USD8.2 billion). Sasol currently operates a large production complex in Lake Charles, La that includes an ethylene cracker. The company also has operations in Arizona, California, Oklahoma, Pennsylvania and Texas. The company's U.S. operations employ approximately 850 people and manufacture the primary ingredients in detergents, personal care products, waxes, catalysts, thickeners and ceramics. GENERAL MOTORS: Faces Fresh Congressional Grilling -------------------------------------------------- Jeff Bennett, writing for The Wall Street Journal, reported that General Motors Co. Chief Executive Mary Barra returns to Capitol Hill this week for what may be her last and toughest hearings with U.S. lawmakers over the auto maker's botched response to a faulty ignition switch that has landed GM in hot water with federal regulators and the Justice Department. According to the report, on July 17, Ms. Barra will face Sen. Richard Blumenthal (D., Conn.), one of her harshest critics, and Sen. Claire McCaskill (D., Mo.), who remains skeptical of GM's response to the issue and its internal probe that cleared the auto maker's executive team and pinned the lack of response on lower- level engineers, lawyers and a dysfunctional company culture. 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. GENERAL CABLE: To Cut 1,000 Jobs in Restructuring ------------------------------------------------- Maria Armental, writing for DBR High Yield, reported that General Cable Corp. said it will cut about 7% of its workforce and close down some plants as part of a restructuring, and it lowered its outlook for operating income for the year. According to the report, the job cuts represent about 1,000 positions globally, the company said, adding the restructuring is expected to be completed over the next year. * * * The Troubled Company Reporter, on Feb. 4, 2014, reported that Moody's Investors Service confirmed General Cable Corp.'s Corporate Family Rating at B1 and its Probability of Default Rating at B1-PD. The confirmation is predicated on the expectation of near-term improvement in operating performance and debt reduction from free cash flow. In a related rating action, Moody's confirmed the B2 rating assigned to the company's senior unsecured notes and the B3 rating assigned to its senior subordinated convertible notes. Moody's also improved the company's liquidity rating to SGL-3 from SGL-4. The rating outlook is negative. These rating actions complete the review initiated on October 31, 2013. Standard & Poor's Ratings Services, in January this year, said it revised its outlook on Highland Heights, Ky.-based General Cable Corp to negative from stable. At the same time, S&P affirmed the ratings on General Cable, including the 'BB-' corporate credit rating. GLOBAL BUILDING: Faces Southcoast Community Bank Foreclosure Suit ----------------------------------------------------------------- In the case, SOUTHCOAST COMMUNITY BANK, Plaintiff, vs. GLOBAL BUILDING SOLUTIONS, LLC; MICHAEL P. MURPHY; WILLIAM E. MURPHY; JAMES A. GANTT; JAMES J. BRADY; AND COLLATERAL DESCRIBED ON COMMERCIAL SECURITY AGREEMENT AND UCC FILING OF RECORD WITH THE SOUTH CAROLINA SECRETARY OF STATE, Defendants, C/A NO: 2013-CP-10- 4695, pending before the THE COURT OF COMMON PLEAS, FOR THE NINTH JUDICIAL CIRCUIT, the defendants are required to answer the Complaint within 30 days after service, exclusive of the day of the service. If the defendants fail to do si, judgment by default will be rendered against them for the relief demanded in the Complaint, except for the United States of America which has 60 days. Counsel to the Plaintiff will seek the agreement and stipulation of all parties not in default for an Order of Reference to the Master-In-Equity for Charleston County, South Carolina, stipulating that the Master-In-Equity may enter a final judgment in this case. Plaintiff's counsel also will seek the authority of the Master-In- Equity, Clerk of Court or Referee to have the sale of the property sought to be foreclosed on the day of the month as the Master-In- Equity, Clerk of Court or Referee may determine. The original Complaint, together with the Summons and Notice, was filed in the Office of the Clerk of Court for Charleston County on August 9, 2013. The Plaintiff is represented by: Samuel H. Altman, Esq. DERFNER, ALTMAN & WILBORN, LLC 575 King Street, Suite B Charleston, SC 29403 Tel: (843) 723-9804 E-mail: saltman@dawlegal.com GLOBAL GEOPHYSICAL: Lists $335-Mil. in Assets, $728-Mil. in Debts ----------------------------------------------------------------- Autoseis, Inc., and Global Geophysical Services, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, schedules of assets and liabilities. Autoseis disclosed $4,820,854 in assets, most of which are notes receivables and work-in-progress property; and $350,630,588, in liabilities. TPG Specialty Lending, Inc., as agent on behalf of prepetition lenders, holds a $91,880, 588, secured claim against Autoseis, while The Bank of New York Mellon Trust Company, N.A., as indenture trustee, holds approximately $257,750,000 in general unsecured non-priority claims. Full-text copies of Autoseis's Schedules are available for free at http://is.gd/323jyF Global Geophysical disclosed $330,714,732 in assets and $377,869,148 in liabilities. The assets are composed of $13,848,698 in real property and $316,866,033 in personal property, while liabilities are composed of $91,880,588 in secured claims and $285,988,560 in unsecured non-priority claims. Full- text copies of Global Geophysical's Schedules are available for free at http://is.gd/fj0Mgm About Global Geophysical, Autoseis et al. Global Geophysical Services Inc., a provider of seismic data for the oil and gas drilling industry, sought bankruptcy protection, intending to reorganize on its own with additional capital or explore a sale or other transaction. Based in Missouri City, Texas, Global Geophysical disclosed assets of $468.7 million and liabilities totaling $407.3 million as of Sept. 30, 2013. Liabilities include $81.8 million on a secured term loan owing to TPG Specialty Lending Inc. and Tennenbaum Capital Partners LLC. TPG is the lenders' agent. Global also owes $250 million on two issues of 10.5 percent senior unsecured notes, with Bank of New York Mellon Trust Co. as indenture trustee. Global Geophysical and five affiliates, including Autoseis, Inc. (lead debtor), filed Chapter 11 petitions in Corpus Christi, Texas (Bankr. S.D. Tex. Lead Case No. 14-20130) on March 25, 2014. The Debtors are represented by C. Luckey McDowell, Esq., Omar Alaniz, Esq., and Ian E. Roberts, Esq., at Baker Botts, LLP, in Dallas, Texas; and Shelby A. Jordan, Esq., and Nathanial Peter Holzer, Esq., at Jordan, Hyden, Womble, Culbreth, & Holzer, PC in Corpus Christi, Texas. Alvarez & Marsal serves as the Debtors' restructuring advisors, Fox Rothschild Inc. as financial advisor, and Prime Clerk as claims and noticing agent. Judy A. Robbins, the U.S. Trustee for Region 7, has selected seven creditors to the Official Committee of Unsecured Creditors. The Committee tapped Greenberg Traurig, LLP as counsel; and Lazard Freres & Co. LLC and Lazard Middle Market LLC, as financial advisors and investment bankers. The Ad Hoc Group of Noteholders and the DIP Lenders are represented by Marty L. Brimmage, Jr., Esq., Charles R. Gibbs, Esq., Michael S. Haynes, Esq., and Lacy M. Lawrence, Esq., at Akin Gump Strauss Hauer & Feld LLP. Prepetition secured lender TPG is represented by David M. Bennett, Esq., Tye C. Hancock, Esq., and Joseph E. Bain, Esq., at Thompson & Knight LLP; and Adam C. Harris, Esq., Lawrence V. Gelber, Esq., David M. Hillman, Esq., and Brian C. Tong, Esq., at Schulte Roth & Zabel LLP. GUAM WATERWORKS: Fitch Rates $84.5MM Revenue Bonds 'BB' ------------------------------------------------------- Fitch Ratings has assigned the following rating to Guam Waterworks Authority (GWA, or the authority): -- $84.5 million water and wastewater system revenue refunding bonds, series 2014A and series 2014B (taxable) 'BB'. The bonds are expected to sell on or around the week of July 21, 2014. Proceeds will be used to refund all or a portion of the authority's outstanding series 2005 bonds and pay costs of issuance. In addition, Fitch affirms the following: -- $377.4 million outstanding water and wastewater revenue bonds at 'BB'. The Rating Outlook is Positive. Security The bonds are secured by a senior lien on the authority's gross revenues excluding development charges. Key Rating Drivers Outlook Reflects Regulatory Compliance Progress: The Positive Outlook reflects the authority's substantial progress to date in addressing remedial actions and improving operating performance. After a lengthy period of non-compliance and regulatory actions, the authority is in compliance with all regulatory requirements and has proactively addressed recent additional United States Environmental Protection Agency (USEPA) findings. Financial Forecast Positive: The Positive Outlook further reflects GWA's recent more consistent financial performance and positive financial forecast aided by the approval of a five-year rate package through fiscal 2018. Political Willingness To Raise Rates: The five-year rate package to support the authority's substantial capital needs, effective Nov. 1 2013, demonstrates continued political willingness to raise rates. Significant additional rate hikes will likely be necessary, which will further pressure customers and could ultimately test rate flexibility. Elevated Debt and Capital Pressures: Debt levels are high and significant capital needs remain to meet ongoing regulatory requirements, which could challenge future financial results. Military Build-Up Delay Continues: Additional capital projects will ultimately be needed to meet expected military build-up demands, although actual needs are not incorporated into GWA's capital improvement program (CIP). However, GWA expects capital costs incurred as a result of the eventual build up will be funded by the U.S. Department of Defense (DOD), including a recent $106 million appropriation. Limited Economic Profile: The service territory is isolated and limited and has had a historical disposition to natural disasters. However, tourism has continued to diversify and recover from the economic downturn, reaching near peak levels in 2013 which are continuing into 2014. Rating Sensitivities CONSISTENT COMPLIANCE AND FINANCIAL PERFORMANCE: Positive rating action is contingent upon the authority's continued compliance with regulatory requirements as well as its ability to produce fiscal 2014 results and maintain favorable out-year expectations in line with its financial forecast. Credit Profile Positive Outlook Reflects Compliance Actions And Financial Forecast The system has recently taken a number of actions to bring it into regulatory compliance and ensure stable operations and finances. A history of weak financial performance and violations of the federal Clean Water Act (CWA) and Safe Drinking Water Act (SDWA) necessitated involvement at the federal regulatory level. Structural changes, which began in 2002 when the authority's governance was changed from an appointed to an elected governing board, resulted in the system's full compliance to date with the 2011 USEPA Court Order (the order) and the recent compliance of its two largest wastewater treatment plants for the first time since enactment of the CWA in 1972. Nevertheless, significant capital needs persist which will challenge utility operations over the long term. Favorable Financial Results And Forecast GWA ended fiscal 2013 in line with prior expectations. Fitch- calculated senior lien debt service coverage (DSC), which is based on audited results and includes accruals, was almost 2.3x while total DSC was 1.4x. DSC was aided by a 9% rate increase effective in February 2013. Revenue gains were partially offset by a 6% increase in operating expenses, even as water purchases from the Navy fell by 13%. The positive operations increased cash balances for the year but with the increase in operating costs, days of operations in cash remained virtually unchanged for the year at 169. GWA projections for fiscals 2014 2018 are in line with its last forecast from October 2013, with fiscal 2014 results expected to be marginally higher than prior estimates. Overall, the authority projects senior DSC of 1.8x to 2.2x through fiscal 2018 despite rising debt service payments with the inclusion of the approved five-year rate plan. Positive rating action is contingent upon continued demonstration of meeting results within forecasted ranges and maintenance of adequate liquidity levels. Strong History of Commitment To Raising Rates Continues Overall, the Consolidated Commission on Utilities (GWA's governing body) and the Public Utility Commission (the PUC) have shown a demonstrated commitment to raising rates to enhance system financial performance, approving cumulative increases of over 95% since fiscal 2007. Residential charges currently exceed Fitch's affordability threshold with combined water and wastewater rates of $90.42 per month at 7,500 gallons of usage, equal to 2.6% of median household income (MHI). GWA's five-year rate proposal that covers fiscals 2014-2018 was approved by the PUC on Oct. 29, 2013. Remaining base annual rate increases range from 4% to 16.5% along with additional surcharges. As such, rates will increase to about 3.0% of median household income (MHI) by fiscal 2018, which is well above Fitch's affordability threshold, assuming an increase in income of 2% per year from 2010 levels, at usage of 7,500 gallons per month. Despite GWA's ratemaking bodies' continued commitment to necessary rate hikes, the level of service charges could limit future rate flexibility to address expected capital needs. Significant Improvement in Regulatory Compliance; Continued Capital Needs To Severely Weaken Debt Profile In 2003, the authority negotiated a stipulated order (SO) with the USEPA as a result of violations to the CWA and SDWA. To cure system-wide deficiencies, the SO was subsequently amended and superseded by the order, which added several major projects to be constructed. Projects included in the order are expected to cost $269 million over the next five years. To date, GWA has completed or has programmed into the fiscal 2014-2018 CIP all but one of the 100 projects required under the order. The USEPA also issued a notice of Findings of Significant Deficiencies for the water system in 2012 and for the wastewater system in 2013. Notably, the authority has addressed 26 of the 40 items identified for water, 10 are in progress, and four are long- term continuing actions. The authority has addressed 76 of the 88 items identified for wastewater and is developing corrective action plans for the remaining 12 items. GWA's progress in addressing regulatory requirements is a positive, but the authority faces significant capital needs to meet remaining requirements. The fiscal 2014-2018 CIP totals $403 million, with the order accounting for 67% of expected expenditures. Funding will be derived largely from ongoing issuances and remaining 2013 bond proceeds (84% of sources), which will drive GWA's currently high debt ratios even higher, to an estimated 4x-5x Fitch's median for investment grade credits. Secondary Treatment Not Addressed in CIP The authority's two largest wastewater treatment plants (WWTPs) have historically operated under secondary treatment variances issued by the USEPA under the CWA, allowing the authority to discharge primary effluent into the Philippine Sea. As part of their June 1, 2013 renewals, the discharge permits for both WWTPs include secondary treatment requirements. The authority estimates the cost of upgrading both treatment plants at $279 million and is currently negotiating a schedule for compliance with the USEPA. The authority expects to receive approval to delay implementation until after completion of projects required under the order and notes that other agencies have negotiated extended compliance schedules of 20-25 years. However, if a shorter timeframe is required, there would likely be significant pressure on the system. The CIP through fiscal 2018 does not include the secondary treatment upgrade projects or the appropriations from the federal government. Military Build-Up Delayed Currently, the DOD build-up is expected to result in an increase of 7,400 military and civilian personnel after 2018. This compares to previous estimates of an ultimate increase to the island's permanent population of around 32,000 people (approximately a 20% increase from the current level) as part of its relocation of troops from the nation of Japan. Positively, the federal government recently appropriated $106 million for civilian water and sewer improvements on the island associated with an expected military build-up, the first time the federal government has actually appropriated money towards such action. Receipt of the monies is uncertain, but GWA expects to use the monies to bring one of the WWTPs up to secondary treatment. GWA continues to expect that any additional costs incurred as a result of the build-up will be borne by the military. Limited Economy The island's economy is driven by the military and tourism sectors. Most tourists are Japanese citizens, although there has been an increasing percentage of South Koreans visiting the island. The year 1997 was the peak year for visitors to the island before a series of setbacks from the Asian economic decline throughout the last decade and various natural disasters, continuing through the recent worldwide economic downturn. However, a recovery is evident with fiscal 2013 marking the second highest year for visitor arrivals and hotel occupancy rates at 85%, the highest in more than a decade; fiscal 2014 is on track to meet or exceed these numbers. Unemployment on the island is mixed depending on the source, ranging from historically very high (in excess of 20%) to only moderately high. Wealth levels are low, with estimated MHI around 75% of the U.S. average. HEARTLAND MEMORIAL: DLA Piper Must Face Avoidance Suit ------------------------------------------------------ Law firm DLA Piper (US) LLP has been sued in an adversary proceeding by the liquidating trustee of debtor Heartland Memorial Hospital, LLC. In a July 9, 2014 Opinion and Order available at http://is.gd/yeBu0Rfrom Leagle.com, District Judge Theresa L. Springmann of the Northern District of Indiana denied DLA Piper's Motion to Dismiss Counts V and VI of the Fourth Amended Complaint in the case captioned as, DAVID ABRAMS, not individually but solely as the Liquidating Trustee and court-appointed manager of Heartland Memorial Hospital, LLC, and HEARTLAND MEMORIAL HOSPITAL, LLC, the Debtor, an Indiana limited liability company, Plaintiffs, v. DLA PIPER (US) LLP, a Maryland limited liability partnership, Defendant, Cause No. 2:12-CV-19-TLS (N.D. Ind.). DLA Piper, which represented Wright Capital Partners, began representing Heartland as well when Wright took control of the hospital facility. DLA Piper provided a wide range of legal services to the hospital, frequently billing over $100,000 a month. With broad access to information about Heartland, DLA Piper was fully aware of Heartland's perilous financial state. DLA Piper subsequently proposed a plan to remove Wright as Heartland's manager. As part of the plan, Heartland Memorial Holdings, formed by Wright Capital et al., agreed to assume responsibility for payment of over $883,000 in unpaid legal fees for work DLA Piper had performed for Wright Capital Partners. DLA Piper sought and received at least partial payment from Heartland. In October 2006, Heartland sold its main hospital campus and most of its remaining assets to the Sisters of St. Francis Health Services. DLA Piper received payment around the time of this transaction, and an additional payment in January 2007. On January 31, 2007, creditors of Heartland filed an involuntary Chapter 7 bankruptcy petition in the U.S. Bankruptcy Court for the Northern District of Indiana, naming Heartland as debtor. On March 2, 2007, Heartland converted the case to a Chapter 11 proceeding. On November 19, 2008, the bankruptcy court approved Heartland's liquidating plan of reorganization and appointed the David Abrams as liquidating trustee, manager, and designated representative. In his suit, Mr. Abrams now seeks to avoid and recover from DLA Piper certain fraudulent transfers and preferences made by the debtor. The Plaintiff also asserted, in a Second Amended Complaint, claims for legal malpractice and breach of fiduciary duty. Upon motion by the Defendant, the Court found that these additional counts did not state claims upon which relief could be granted, and dismissed those counts without prejudice, and with leave to re-file. In response, the Plaintiff filed a Fourth Amended Complaint, which added claims for breach of fiduciary duties (Count VI), and aiding and abetting breach of fiduciary duties (Count V). The Defendant now seeks to dismiss these claims on grounds that the leave to amend the Court granted was very specific and did not include the right to re-plead breach of fiduciary duty claims or to file a claim for aiding and abetting a breach of fiduciary duty. The Defendant also argues that the claim for breach of fiduciary duty that is asserted in the Fourth Amended Complaint is no different from the breach of fiduciary duty claim that the Court already dismissed, and thus fails to state a claim upon which relief can be granted. The Defendant argues that the aiding and abetting claim is not plausible because it would require that the Defendant assisted insiders in looting an entity over which its client intended to gain operational control and had already made a substantial loan to. The Plaintiff counters on the procedural issues, and points to new facts he alleged to correct the deficiencies noted by the Court in its dismissal order. According to Judge Springmann, Mr. Abrams has crafted claims that are plausibly supported with specific allegations regarding the relationships and transactions between the various entities involved. That these claims may prove, after discovery, to be unsupportable does not warrant dismissal at this stage of the proceedings. David Abrams is represented by: Elizabeth E Richert, Esq. Eugene J Schiltz, Esq. THE COLEMAN LAW FIRM 77 West Wacker Drive Chicago, IL 60601 Tel: 312-444-1000 Fax: 312-444-1028 E-mail: erichert@colemanlawfirm.com eschiltz@colemanlawfirm.com - and - Mark E Leipold, Esq. GOULD & RATNER LLP 222 North LaSalle, Suite 800 Chicago, IL 60601 Tel: 312-236-3003 312-899-1651 312-286-0553 E-mail: mleipold@gouldratner.com DLA Piper US LLP is represented by: Martin J O'Hara, Esq. MUCH SHELIST PC 191 North Wacker Drive, Suite 1800 Chicago, IL 60606.1615 Tel: 312-521-2725 Fax: 312-521-2825 E-mail: mohara@muchshelist.com HELP AT HOME: Case Summary & Largest Unsecured Creditors -------------------------------------------------------- Debtor affiliates filing separate Chapter 11 bankruptcy petitions: Debtor Case No. ------ -------- Help at Home Franchise Service LLC 14-25706 354 N.E. 1st Ave. Delray Beach, FL 33444 Help at Home Health Care Services, Inc. 14-25709 10808 Avenida Santa Ana Boca Raton, FL 33498 Chapter 11 Petition Date: July 10, 2014 Court: United States Bankruptcy Court Southern District of Florida (West Palm Beach) Judge: Hon. Paul G. Hyman, Jr. Debtors' Counsel: Aaron A Wernick, Esq. FURR & COHEN 2255 Glades Rd # 337W Boca Raton, FL 33431 Tel: (561) 395-0500 Fax: (561) 338-7532 Email: awernick@furrcohen.com Total Total Assets Liabilities --------- ----------- Help at Home Franchise $61,500 $1.68-Mil. Help at Home Health Care $0 $4.69-Mil. The petitions were signed by Frank V. Guerrieri, general partner of managing member of Debtor. A list of Help at Home Franchise's 14 largest unsecured creditors is available for free at http://bankrupt.com/misc/flsb14-25706.pdf A list of Help at Home Health Care's 13 largest unsecured creditors is available at : http://bankrupt.com/misc/flsb14-25709.pdf HEMISPHERE MEDIA: Loan Upsizing No Impact on Moody's B2 CFR ----------------------------------------------------------- Moody's Investors Service says that Hemisphere Media Holdings, LLC's upsizing of the senior secured term loan due 2020 to $200 million from $174 million will have no immediate impact on credit ratings. Net proceeds from the new term loan will be used primarily to refinance the existing $174 million senior secured term loan due 2020. All other existing ratings, including the B2 Corporate Family Rating and the stable outlook remain unchanged. Issuer: Hemisphere Media Holdings, LLC UPSIZED $200 million 1st Lien Senior Secured Term Loan due 2020: B2, LGD3 Ratings Rationale Hemisphere's B2 Corporate Family Rating reflects high leverage with debt-to-EBITDA of 4.5x for LTM March 31, 2014 (including Moody's standard adjustments, pro forma for recent acquisitions and increased term loan), the company's lack of scale, event risk related to its acquisition strategy, as well as operating risks. Hemisphere relies on its single Puerto Rico based independent television station (WAPA-TV) and self-produced programming which is also distributed through its cable network (WAPA America). The company's cable networks are exposed to risks associated with reliance on licensed third party content including films and telenovelas. Despite these challenges, ratings are supported by Hemisphere's focus on the high growth Spanish speaking U.S. population combined with continuing subscriber growth for the Hispanic segment in the U.S. and Latin America. The company benefits from the leading position of its broadcast operations in Puerto Rico and the revenue benefits from producing its own attractive programming. Ratings are also supported by Cinelatino's distinctive position as an independent film channel, with access to film content from many distributors, typically with exclusive rights. Despite the addition of three cable networks, Moody's believes Hemisphere has less leverage when negotiating subscription fees due to its lack of scale. Management addresses this challenge through its acquisition strategy and plans to supplement current revenue by developing an ad model for Cinelatino which currently relies 100% on subscriber fees. Pro forma for the acquisitions, Hemisphere's overall revenue mix has improved to 50% advertising and 50% subscriber fees. Despite the weak economic environment in Puerto Rico, the company has tracked only slightly behind its revenue plan laid out in July 2013 when new debt was issued. Moody's believes advertisers are increasingly attracted to the higher growth Spanish language segment in the U.S. Beyond the near term, however, Moody's believes the company remains vulnerable to competition from deeper pocketed players and the potential for extended economic weakness in Puerto Rico. Furthermore, there are meaningful event risks related to the company's acquisition strategy and plans to further expand in Latin America. Liquidity is strong with a minimum of $20 million of cash balances supplemented by high-single digit percentage free cash flow-to-debt ratios from continuing operations, and no debt maturities until 2020. The stable outlook reflects Moody's view that the company will generate at least low to mid-single digit percentage revenue growth over the next 12-18 months, excluding the impact of acquisitions, supported by subscriber growth and contractual increases in both broadcast retransmission and cable subscriber fees. The outlook incorporates Moody's expectations that debt-to- EBITDA ratios will not increase over the next 12 months, and that future acquisitions will be funded largely with excess cash. The outlook does not incorporate dividends nor debt financed acquisitions that would increase gross debt-to-EBITDA ratios above current levels. Ratings could be downgraded if overall performance were to deteriorate due to increased competition, underperformance in Puerto Rico, or the inability to integrate recent or future acquisitions. Deterioration in the company's liquidity reflected by below expected balance sheet cash levels or debt financed acquisitions resulting in debt-to-EBITDA ratios being sustained above 5.0x (including Moody's standard adjustments) could also result in a downgrade. Although not likely given management's acquisition strategy, lack of scale, and reliance on the Puerto Rico economy for the majority of its ad revenue, Moody's could consider an upgrade of ratings if debt-to-EBITDA ratios are sustained comfortably below 3.75x with free cash flow-to-debt ratios remaining above 12%. Management would also need to demonstrate success in its acquisition strategy and Moody's would need to be assured that liquidity would remain good. Hemisphere Media Holdings, LLC, headquartered in Miami, FL, is a U.S. Spanish-language TV and cable network business serving the high-growth U.S. Hispanic population. Hemisphere owns and operates Cinelatino (a Spanish-language movie channel), WAPA TV (a leading broadcast station in Puerto Rico), and WAPA America (a cable network targeting Puerto Rican and other Caribbean Hispanics living in the U.S.). On April 1, 2014, the company acquired three Spanish-language cable television networks, Pasiones, Centroamerica TV, and TV Dominicana, from Media World, LLC for roughly $102 million in cash. InterMedia Partners VII, L.P. owns approximately 58% of the economic interest in Hemisphere (approximately 77% of voting interest). Revenue for LTM March 31, 2014 pro forma for the recent acquisition and for the April 2013 merger of WAPA and Cinelatino is estimated at $116 million. The principal methodology used in this rating was the Global Broadcast and Advertising Related Industries Methodology published in May 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. HEMISPHERE MEDIA: S&P Affirms 'B' CCR; Outlook Stable ----------------------------------------------------- Standard & Poor's Ratings Services affirmed the 'B' corporate credit rating on Coral Gables, Fl.-based U.S. Hispanic television and cable broadcaster Hemisphere Media Group Inc. The outlook is stable. At the same time, S&P raised its issue-level rating on Hemisphere Media Holdings LLC's term loan B to 'B+' from 'B', and revised the recovery rating to '2' from '3'. A recovery rating of '2' indicates S&P's expectations of substantial (70%-90%) recovery in the event of a payment default. "We are raising our issue-level ratings on the company's term loan because of the increased cash flow from the company's April 2014 acquisition of the Spanish language television business of Media World," said Standard & Poor's credit analyst Naveen Sarma. The ratings on Hemisphere reflect a "weak" business risk profile and a "significant" financial risk profile. The "weak" business risk profile, as per S&P's criteria, is based on the company's limited scale, with only a single TV broadcasting station in Puerto Rico and five U.S.-based and two Latin America-based Spanish language cable networks, pro forma for the April 2014 acquisition of Media World LLC's cable networks. S&P also weighs the company's narrow business focus, primarily targeting Hispanics living in the U.S. S&P views Hemisphere Media Group's management and governance as "fair." S&P regards Hemisphere's financial risk profile as "significant" because of its expectation for leverage to decline to, and remain below, 4x over the intermediate term. "While management has expressed a desire to operate with leverage under 4x, we believe the company will pursue acquisitions, which could increase leverage, temporarily, above its leverage target," said Mr. Sarma. HYPERION FOUNDATION: Miss. Court Rules in Qui Tam Action -------------------------------------------------------- In the case, UNITED STATES OF AMERICA ex rel. ACADEMY HEALTH CENTER, INC. f/k/a ADVENTIST HEALTH CENTER, INC. Plaintiff, v. HYPERION FOUNDATION, INC., d/b/a OXFORD HEALTH & REHABILITATION CENTER; ALTACARE CORPORATION; HP/ANCILLARIES, INC.; LONG TERM CARE SERVICES, INC.; SENTRY HEALTHCARE ACQUIRORS, INC.; HP/MANAGEMENT GROUP, INC.; HARRY McD. CLARK; JULIE MITTLEIDER; DOUGLAS K. MITTLEIDER; and JOHN DOES 1-200, Defendants, Civil Action No. 3:10-CV-552-CWR-LRA (S.D. Miss.), District Judge Carlton W. Reeves ruled on a series of motions: -- The Defendants' Motion to Dismiss the United States' Complaint in Intervention is denied; -- The Motion to Dismiss Academy's Second Amended Complaint for Lack of Subject Matter Jurisdiction and Failure to State A Claim is granted, in part, and denied, in part; -- The Motion for Leave to Amend the Complaint is denied; and -- The Motion to Strike the Affidavit of Melvin Eisele is granted. The case arises out of a qui tam action brought by relator Academy Health Center, Inc., frequently known as Adventist Health Center, Inc. on behalf of the United States as Relator. AHC is a health care provider which, as part of its business, owns and leases skilled nursing facilities to other health care companies to manage them. On October 5, 2005, Hyperion Foundation, Inc. entered into a lease agreement with AHC to manage the Oxford Health and Rehabilitation Center, a skilled nursing facility in Lumberton, Mississippi. In turn, Hyperion entered into a management agreement with defendant AltaCare Corporation to manage the facility. As part of the terms, conditions and provisions of the lease agreement, Hyperion assumed the operations of Oxford and all of the rights and authority to operate Oxford and receive and accept payments, including those from Medicare and Medicaid, on behalf of the facility and its residents for services rendered to those residents. The Relator AHC claims that this case began when Hyperion failed to pay the rent due to AHC, in violation of the lease agreement. AHC performed an initial investigation and determined that the Defendants could not or would not provide the requisite level of care for the residents. As a result, AHC took steps to terminate the lease and evict Hyperion as a tenant. On July 15, 2008, AHC filed a Motion and/or Affidavit to Remove Tenant in the Justice Court of Lamar County, Mississippi, in an effort to evict Hyperion from the premises and terminate the relationship. The Motion sought to remove Hyperion as tenant by August 1, 2008, but Hyperion requested to continue the eviction hearing until August 6, 2008. On August 5, 2008, Hyperion filed a petition under Chapter 11 of the United States Bankruptcy Code before the U.S. Bankruptcy Court for the Southern District of Mississippi. As a result of the bankruptcy filing, the eviction proceeding could not go forward. On September 30, 2009, Relator AHC filed its original Qui Tam Complaint and Other Relief in the bankruptcy proceeding, under seal, pursuant to 28 U.S.C. sections 157 and 1334(a)-(b). AHC provided a copy of the complaint and a confidential disclosure statement of all material evidence and information to the Attorney General of the United States and the U.S. Attorney for the Southern District of Mississippi, as required by the False Claims Act. On November 20, 2009, Relator AHC filed its First Amended Qui Tam Complaint and Other Relief, under seal, to allege new information and facts in support of its cause of action. The Relator duly provided the Complaint to the Government. On March 22, 2010, the bankruptcy court granted the United States Trustee's Motion to Dismiss Hyperion from bankruptcy due to Hyperion's failure to submit a disclosure report and its failure to file all monthly operating statements with the court and retained jurisdiction over the settlement agreement between Hyperion and AHC. On October 4, 2010, the bankruptcy court entered an agreed order transferring the qui tam proceeding originally brought in the bankruptcy action to the District court. On December 3, 2012, after extensive investigation, the Government filed a Notice of Election to Intervene in Part and to Decline in Part in this action. The Government notified the Court of its decision to "intervene[] in that part of the action which alleges that defendants Hyperion, AltaCare, Long Term Care Services, Inc. ("LTCS") and Douglas K. Mittleider, made, caused to be made, and/or conspired to make false claims and false statements material to false claims to Medicare and Medicaid, for nursing home services at the Oxford Health & Rehabilitation Center facility in Lumberton, Mississippi." AHC filed its Second Amended Complaint on February 11, 2011. The Complaint alleges that, from October 5, 2005 through at least May 1, 2012, Defendants made or caused to be made false or fraudulent claims and statements to the federal Medicare program and the federal-state Mississippi Medicaid program, for nursing home services purportedly provided to residents of Oxford which services were in fact non-existent, grossly deficient, materially substandard and/or worthless. A copy of the District Court's July 9, 2014 Memorandum Opinion and Order is available at http://is.gd/T4LA1jfrom Leagle.com. Academy Health Center, Inc., is represented by: Julie Bowman Mitchell, Esq. J. Tucker Mitchell, Esq. Randall E. Day, Esq. MITCHELL DAY HEALTH LAW FIRM, PLLC 618 Crescent Boulevard, Suite 203 Ridgeland, MS 39157-8664 Hyperion Foundation, Inc., Defendant, represented by: Gregory C. Sicilian, Esq. James W. Boswell, III, Esq. Michael E. Paulhus, Esq. KING & SPALDING, LLP 1180 Peachtree Street Atlanta, GA 30309 Tel: 404-572-2810 Fax: 404-572-5100 E-mail: gsicilian@kslaw.com jboswell@kslaw.com mpaulhus@kslaw.com - and - Vikki J. Taylor, Esq. GIBBS WHITWELL PLLC 1400 Meadowbrook Rd. Suite 100 Jackson, MS 39211 Tel: 601-487-2640 Fax: 601-366-4295 - and - Jeremy L. Birdsall, Esq. John P. Sneed, Esq. WISE, CARTER, CHILD & CARAWAY 401 East Capitol Street Heritage Building, Suite 600 Jackson, MS 39201 Tel: 601-968-5500 601-944-7731 E-mail: jlb@wisecarter.com jps@wisecarter.com Altacare Corporation, Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. Long Term Care Services, Inc., Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. Sentry Healthcare Acquirors, Inc., Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. HP/Management Group, Inc., Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. Julie Mittleider, Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. Douglas K. Mittleider, Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY, John P. Sneed, Wise Carter Child & Caraway & Robert L. Gibbs, Gibbs Whitwell PLLC. HP/Ancillaries, Inc., Defendant, represented by Gregory C. Sicilian, KING & SPALDING, LLP, James W. Boswell, III, KING & SPALDING, LLP, Michael E. Paulhus, KING & SPALDING, LLP, Vikki J. Taylor, GIbbs Whitwell PLLC, Jeremy L. Birdsall, WISE, CARTER, CHILD & CARAWAY & John P. Sneed, Wise Carter Child & Caraway. United States of America is represented by Edward O. Pearson, U. S. ATTORNEY'S OFFICE & Samuel Lynn Murray, U.S. ATTORNEY'S OFFICE. Based in Lumberton, Mississippi, Hyperion Foundation, Inc., dba Oxford Health & Rehabilitation Center, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Miss. Case No. 08-51288) on Aug. 5, 2008, one day before the scheduled hearing on its landlord's eviction motion. Douglas K. Mittleider, manager, filed the petition on the Debtor's behalf. Craig M. Geno, Esq., at Harris Jernigan & Geno, PLLC, served as the Debtor's counsel. In its petition, the Debtor estimated $1 million to $10 million in assets and debts. INTERSTATE BAKERIES: Liquidity Solutions' Suit Proceeds ------------------------------------------------------- LIQUIDITY SOLUTIONS, INC., Plaintiff, v. PROCORP IMAGES, INC., Defendant, Civ. Docket No. 13-6447 (D.N.J.), is a contract dispute involving the sale in October 2004 by Procorp to Liquidity of two bankruptcy claims Procorp had against Interstate Bakeries Corporation. Liquidity argues that Procorp failed to uphold a contractual duty to forward a notice from the IBC Bankruptcy Trustee and that Liquidity was ultimately barred from collecting on the claims due this alleged breach of contract. The two Assignments of Claim are identical except for the amount of the claims. The two Assignments state that they are worth $17,500 and $194,866, for a total of $212,366. In 2008, the Bankruptcy Court confirmed an Amended Joint Plan of Reorganization. In 2011, the Plan Trustee filed a motion to disallow claims of beneficiaries who had not responded to the request for the tax identification. Procorp's claims were included in the motion to disallow because Procorp never responded to the Trustee's request for tax information. The Bankruptcy Court granted the Trustee's motion to disallow, thus precluding Liquidity from collecting anything on the claims it purchased from Procorp. Pursuant to Federal Rule of Civil Procedure 12(b)(6), Procorp moves to dismiss the first three causes of action in Liquidity's Complaint for failure to state a claim. Liquidity opposed. There was no oral argument. In a July 9, 2014 Opinion available at http://is.gd/7YAT1Yfrom Leagle.com, New Jersey District Judge William J. Martini ruled that Procorp's motion is granted with respect to the Second Cause of Action only. The motion is denied with respect to the First and Third Causes of Action. Liquidity Solutions, Inc., is represented by: Michael Korik, Esq. LAW OFFICES OF CHARLES A GRUEN 381 Broadway Suite 300 Westwood, NJ, 07675 Tel: 201-342-1212 Procorp Images, Inc., is represented by: Lawrence P. Eagel, Esq. BRAGAR EAGEL & SQUIRE, PC 885 Third Avenue, Suite 3040 New York, NY 10022 Tel: (212) 308-5858 Fax: (212) 486-0462 Email: eagel@bespc.com 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. LABORATORY PARTNERS: Ch. 11 Plan Confirmed ------------------------------------------ Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware on July 10 confirmed Laboratory Partners, Inc., et al.'s First Amended Joint Chapter 11 Plan after determining that it satisfies the confirmation requirements under the Bankruptcy Code. All objections to the Plan, including those raised by the U.S. Trustee and the U.S. Department of Health and Human Services through Centers for Medicare and Medicaid Services, were overruled. The Debtors said CMS' and the U.S. Trustee's objections were resolved through amendments to the Plan and language in the confirmation order. Marathon Special Opportunity Fund, L.P., and Marathon Asset Management L.P., as DIP Lender, and Prepetition Lender, supported the Debtors' bid for confirmation of their Plan. The time by which the Debtors have exclusive right to file a plan expires on Aug. 22, 2014, while the time by which they have exclusive right to solicit acceptances of the plan expires on Oct. 21. About Laboratory Partners Laboratory Partners Inc., a Cincinnati-based provider of lab and pathology services, and several affiliates filed petitions for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-12769) on Oct. 25, 2013, in Delaware. In its assets, the Debtor disclosed $43,034,702.91 in total assets and at least $132,357,067.42 (plus unknown) in total liabilities. The debtor-affiliates are Kilbourne Medical Laboratories, Inc., MedLab Ohio, Inc., Suburban Medical Laboratory, Inc., Biological Technology Laboratory, Inc., Terre Haute Medical Laboratory, Inc., and Pathology Associates of Terre Haute, Inc. Certain of the Debtors do business as MEDLAB. Judge Peter J. Walsh presides over the case. The Debtors are represented by Robert J. Dehney, Esq., Derek C. Abbott, Esq., Andrew R. Remming, Esq., and Ann R. Fay, Esq., at Morris, Nichols, Arsht, and Tunnell, LLP in Wilmington, Delaware; and Leo T. Crowley, Esq., Jonathan J. Russo, Esq., and Margot Erlich, Esq., at Pillsbury, Winthrop, Shaw, Pittman, LLP in New York, NY. BMC Group Inc. serves as claims and administrative agent. Duff & Phelps Securities LLC serves as the Debtors' investment bankers. The Official Committee of Unsecured Creditors has retained Otterbourg P.C., as Lead Co-Counsel; Klehr Harrison Harvey Branzburg LLP as Delaware Counsel; and Carl Marks Advisory Group LLC, as financial advisors. * * * In March 2014, the Bankruptcy Court authorized the Debtors to sell their so-called "Talon Division," which refers to the clinical laboratory and anatomic pathology services to (i) physicians, physician officers and medical groups in Indiana, Illinois, and (ii) Union Hospital, Inc., in Terre Haute and Clinton, Indiana, to Laboratory Corporation of America Holdings for $10.5 million. An auction was cancelled after the Debtors received no competing bid during the bid deadline. The Court also authorized the Debtors to sell certain of their assets relating to their nuclear medicine business to Union Hospital, Inc. In June 2014, the Debtors won Court approval to sell its long-term care division to Amerathon LLC for a $5.5 million credit bid. Amerathon is a joint venture between American Health Associates, Inc., and the Debtor's prepetition senior secured lender. The U.S. Bankruptcy Court has approved the disclosure statement explaining Laboratory Partners, Inc.'s Chapter 11 plan and scheduled a July 9, 2014, confirmation hearing. The Plan provides that only the prepetition lender holding secured claims is entitled to vote. The rest of the creditors, including general unsecured creditors, are unimpaired, will receive nothing under the Plan, and are not entitled to vote. LEHMAN BROTHERS: Has Approval to Allocate $1BB to Brokerage Estate ------------------------------------------------------------------ The official liquidating Lehman Brothers Holdings Inc.'s brokerage received approval from U.S. Bankruptcy Judge Shelley Chapman of the U.S. Bankruptcy Court for the Southern District of New York to earmark $1 billion to the LBI general estate. The funds consist of dividends and interest received by the Lehman brokerage subsequent to Sept. 19, 2008. These are the funds left after the trustee made cash payments to customers of the brokerage. As of April 30, 2014, the trustee held more than $1.25 billion but only $1 billion will be distributed to general creditors. The trustee will keep more than $250 million as reserve, which will be distributed only after issues concerning cash-generating securities are resolved. James Giddens, the court-appointed trustee, said the remaining funds are not tied to securities distributed to customers, and would go to the brokerage's general estate. As of April 30, the trustee held more than $1.25 billion but only $1 billion will be distributed to the estate immediately after it is approved by a bankruptcy court. The trustee will keep more than $250 million as reserve, which will only be distributed after issues concerning cash-generating securities are resolved. Last year, then-Lehman bankruptcy judge James Peck authorized the trustee to allocate about $15.2 billion, which include $10.863 billion worth of securities and $1.691 billion of cash held in accounts for the brokerage's customers. Mr. Peck also authorized the trustee to distribute funds, which consist of cash dividends and interest, tied to securities delivered to customers. Lehman received those funds from various issuers and depositories on account of securities in the possession of the trustee. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wins Nod to Set Aside Reserves for Secured Claims ------------------------------------------------------------------ James W. Giddens, the official liquidating Lehman Brothers Holdings Inc.'s brokerage arm, received approval from the U.S. Bankruptcy Court in Manhattan to set aside reserves for allowed secured, priority and administrative claims. The bankruptcy court's approval would allow Mr. Giddens to distribute more than $240 million to around 180 creditors whose secured and priority claims have already been approved by the court. Mr. Giddens was authorized to pay holders of allowed secured and priority claims in full on condition that he would set aside a separate reserve for Barclays Capital Inc.'s claim. Last year, Barclays filed a claim against the brokerage in the amount of $103 million. On June 18, the bankruptcy court approved an agreement between the trustee and Barclays that would resolve the claim of the U.K.-based bank. Under the agreement, a portion of Barclay's administrative claim is allowed in the amount of $25.2 million and the bank is entitled to an administrative priority distribution in the amount of $9 million. A copy of the agreement can be accessed for free at http://is.gd/f20mKB $2.54 Million Reserve for IRS Mr. Giddens was also authorized by the bankruptcy court to set aside up to $2.54 million to cover the tax claim of the Internal Revenue Service. The agency filed last year an amended tax claim against the Lehman brokerage in the amount of $394.5 million, of which more than $4.6 million is for non-consolidated tax liabilities attributable solely to the brokerage. The remaining $389.9 million is for the alleged consolidated income tax liabilities of the Lehman consolidated group of which the U.S.-based holdings company is the common parent. The IRS previously requested for a $390 million reserve for its tax claim. Mr. Giddens objected, arguing that it would result in three separate reserves for the claim to the detriment of other creditors. The trustee also said that the Lehman parent is already maintaining a reserve sufficient to cover the agency's claim. In a related development, Mr. Giddens set July 16 as the record date for secured, administrative and priority claims. The trustee will not recognize any transfer of claims recorded on the claims register after the record date. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: LBI to Set Aside $3-Bil. for Unsecured Claims -------------------------------------------------------------- James W. Giddens, the trustee liquidating Lehman Brothers Holdings Inc.'s brokerage, has filed a motion seeking court approval to set aside $3 billion or more to cover claims of unsecured creditors. Specifically, the LBI Trustee is seeking authority to cap the maximum allowable unsecured amounts, and establish an interim distribution fund of $3 billion or more, for unsecured claims for the purpose of making an interim distribution to the holders of allowed unsecured claims and reserving for unresolved claims on a pro rata basis. The motion, if approved, would allow the trustee to make an initial payment to unsecured creditors whose claims have already been approved by the court, and to maintain a reserve for unresolved unsecured claims on a pro rata basis. Mr. Giddens is planning to make a first interim distribution to allowed unsecured creditors with a record date of July 15. As of May 31, Mr. Giddens has allowed 2,638 unsecured claims totaling approximately $20.3 billion, according to the filing. There were 909 claims subject to objections pending before the court and an additional 1,353 remaining unresolved general creditor claims as of May 31. Some of the unresolved claims were asserted in contingent and unliquidated amounts or were asserted in liquidated amounts with a reservation of the right to amend the asserted claim amount. Judge Shelley Chapman will hold a hearing on July 30. Objections are due by July 21. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Newport Appeals Disallowance of Claims ------------------------------------------------------- Newport Global Advisors LP has appealed a bankruptcy judge's order that barred the firm from pursuing a $100 million claim against Lehman Brothers Holdings Inc. and its subsidiaries. Newport filed a claim to recover fees it lost as a result of Lehman Brothers Inc.'s failure to transfer to another prime broker the accounts of two of the firm's investment funds. The firm had argued that it is a third-party beneficiary of the funds' accounts and seeks $100 million in damages. LBI, the brokerage arm of the holdings company, served as prime broker for the investment funds before bankruptcy. Lehman in March filed an objection in which it asked the bankruptcy judge to extinguish the claim, arguing that Newport wasn't a party to the prime brokerage agreements. On June 18, Judge Shelley Chapman ruled in favor of Lehman, saying the agreements are "completely silent as to whether Newport is an intended beneficiary." "It is clear that the agreements evidence no intent on their face to benefit Newport," Judge Chapman wrote in her June 18 decision. "No assertion that Newport has made in the proofs of claim or its pleadings supports the inference that Lehman and the funds intended to confer a benefit on Newport." Newport brought the appeal before the U.S. District Court for the Southern District of New York. Newport is represented by: David J. Molton, Esq. Andrew Dash, Esq. Howard S. Steel, Esq. BROWN RUDNICK LLP Seven Times Square New York, NY 10036 Tel: 212-209-4800 Fax: 212-209-4801 E-mail: dmolton@brownrudnick.com adash@brownrudnick.com hsteel@brownrudnick.com About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LIGHTSQUARED INC: Harbinger Sues the U.S. Government ---------------------------------------------------- Joseph Checkler, writing for The Wall Street Journal, reported that Philip Falcone's Harbinger Capital Partners is suing the federal government for allegedly reneging on an agreement regarding wireless venture LightSquared. According to the report, in a suit filed on July 11 with the U.S. Court of Federal Claims in Washington, Harbinger said global positioning systems companies "unlawfully" used spectrum owned by the Harbinger-backed LightSquared. "Harbinger has lost most of its approximately $1.9 billion investment, despite having made that investment in specific reliance on the government's agreement to permit it to build, deploy, and operate a nationwide broadband network using LightSquared's spectrum," the Journal cited Harbinger lawyers as saying in the filing. About LightSquared Inc. LightSquared Inc. and 19 of its affiliates filed Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on May 14, 2012, to resolve regulatory issues that have prevented it from building its coast-to-coast integrated satellite 4G wireless network. LightSquared had invested more than $4 billion to deploy an integrated satellite-terrestrial network. In February 2012, however, the U.S. Federal Communications Commission told LightSquared the agency would revoke a license to build out the network as it would interfere with global positioning systems used by the military and various industries. In March 2012, the Company's partner, Sprint, canceled a master services agreement. LightSquared's lenders deemed the termination of the Sprint agreement would trigger cross-defaults under LightSquared's prepetition credit agreements. LightSquared and its prepetition lenders attempted to negotiate a global restructuring that would provide LightSquared with liquidity and runway necessary to resolve its issues with the FCC. Despite working diligently and in good faith, however, LightSquared and the lenders were not able to consummate a global restructuring on terms acceptable to all interested parties. Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to the Debtors. Alvarez & Marsal North America, LLC, is the financial advisor. Kurtzman Carson Consultants LLC serves as claims and notice agent. LOCATION BASED TECH: Incurs $1.5-Mil. Net Loss in May 31 Quarter ---------------------------------------------------------------- Location Based Technologies, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $1.54 million on $455,139 of total net revenue for the three months ended May 31, 2014, as compared with a net loss of $3.10 million on $755,179 of total net revenue for the same period last year. For the nine months ended May 31, 2014, the Company reported a net loss of $3.93 million on $1.20 million of total net revenue, as compared with a net loss of $7.95 million on $1.55 million of total net revenue for the same period in 2013. The Company's balance sheet at May 31, 2014, showed $2.68 million in total assets, $11.91 million in total liabilities and a $9.23 million total stockholders' deficit. "We have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing," the Company stated in the filing. A full-text copy of the Form 10-Q is available for free at: http://is.gd/XDJRgd About Location Based Technologies Irvine, Calif.-based Location Based Technologies, Inc., designs, develops, and sells leading-edge personal locator devices and services. The Company incurred a net loss of $11.04 million for the year ended Aug. 31, 2013, as compared with a net loss of $7.96 million for the year ended Aug. 31, 2012. Comiskey & Company, the Company's independent registered public accounting firm, issued a "going concern" qualification on the consolidated financial statements for the year ended Aug. 31, 2013. The independent auditors noted that the Company has incurred recurring losses since inception and has accumulated deficit in excess of $45 million. There is no establised sales history for the Company's products, which are new to the marketplace, the auditors added. Bankruptcy Warning The Company said it remains obligated under a significant amount of notes payable, and Silicon Valley Bank has been granted security interests in the Company's assets. "If we are unable to pay these or other obligations, the creditors could take action to enforce their rights, including foreclosing on their security interests, and we could be forced into liquidation and dissolution. We are also delinquent on a number of our accounts payable. Our creditors may be able to force us into involuntary bankruptcy," the Company said in the 2013 Annual Report. MARKERS COMPANIES: Case Summary & Largest Unsecured Creditors ------------------------------------------------------------- Debtor affiliates filing separate Chapter 11 bankruptcy petitions: Debtor Case No. ------ -------- The Markers Companies, Inc. 14-14751 11411 Southern Highlands Parkway, Suite 220 Las Vegas, NV 89141 The Markers Eagles Nest, LLC 14-14752 4951 E. Arroyo Verde Paradise Valley, AZ 85253 Chapter 11 Petition Date: July 10, 2014 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Hon. August B. Landis (14-14751) Hon. Laurel E. Davis (14-14752) Debtors' Counsel: Matthew C. Zirzow, Esq. LARSON & ZIRZOW, LLC 810 S. Casino Center Blvd. #101 Las Vegas, NV 89101 Tel: 702-382-1170 Fax: 702-382-1169 Email: mzirzow@lzlawnv.com zlarson@lzlawnv.com Estimated Estimated Assets Liabilities ---------- ----------- The Markers Companies, Inc. $0-$50,000 $1MM-$10MM The Markers Eagles Nest, LLC $0-$50,000 $1MM-$10MM The petitions were signed by Vincent Goett, director, secretary and treasurer. A list of The Markers Companies' four largest unsecured creditors is available for free at http://bankrupt.com/misc/nvb14-14751.pdf A list of The Markers Eagles Nest's 11 largest unsecured creditors is available for free at http://bankrupt.com/misc/nvb14-14752.pdf MATTESON HOLDING: Case Summary & 10 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Matteson Holding I LLC c/o Dean Lakhani 4930 Main Street Downers Grove, IL 60515 Case No.: 14-25512 Nature of Business: Single Asset Real Estate Chapter 11 Petition Date: July 10, 2014 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Judge: Hon. Donald R Cassling Debtor's Counsel: Allan O. Fridman, Esq. WALLACH MICHALEC FRIDMAN, P.C. 555 Skokie Blvd, Suite 500 Northbrook, IL 60062 Tel: 847 412-0788 Fax: 847 412-0898 Email: allanfridman@gmail.com afridman@wmflegal.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Dave Mundrawala, member. A list of the Debtor's 10 largest unsecured creditors is available for free at http://bankrupt.com/misc/ilnb14-25512.pdf MCS AMS SUB-HOLDINGS: Moody's Lowers Corp. Family Rating to B3 -------------------------------------------------------------- Moody's Investors Service downgraded the credit of MCS AMS Sub- Holdings LLC (MCS AMS). The Corporate Family rating (CFR) was downgraded to B3 from B2, the Probability of Default rating (PDR) to Caa1-PD from B3-PD, and the senior secured debt to B3 from B2. The ratings outlook was revised to negative. Ratings Rationale The downgrade to B3 CFR reflects Moody's expectations for revenue declines in 2014 and no growth in 2015 driven by ongoing residential mortgage foreclosure delays and the loss of certain contracts from one of MCS AMS's largest customers. Moody's expects 2014 revenues of about $400 million, down over 10% from 2013 (pro forma for the 2013 merger of Asset Management Holdings, Inc. and Mortgage Contracting Services LLC). MCS AMS's top 5 customers will account for over 80% of revenue. Although credit metrics are moderate (with adjusted Debt to EBITDA of about 4 times expected in 2014), heightened business risks related to ongoing levels of mortgage foreclosures and high customer concentration constrain the ratings. Moody's anticipates annual free cash flow of about $25 million in 2014. MCS AMS operates under a highly variable cost structure through its use of subcontractors, helping it maintain profits and cash flow despite the revenue decline. Moody's considers MCS AMS's liquidity position to be adequate; however, if free cash flow is less than Moody's anticipates, MCS AMS may require other cash sources to meet debt amortization requirements of $38.25 million over the next 18 months. The $20 million senior secured revolving credit facility provides some external liquidity. The negative ratings outlook is driven by Moody's concerns over MCS AMS's ability to achieve adequate free cash flow to meet required debt amortization payments given recent contract losses and difficulty in predicting mortgage foreclosure volumes. The ratings could be lowered if revenues decline or liquidity deteriorates. The ratings outlook could be changed to stable if revenues stabilize and Moody's considers liquidity at least adequate. The ratings could be upgraded if MCS AMS demonstrates sustained revenue growth, substantial improvement in credit metrics and improved liquidity while Moody's expects the application of free cash flow to debt reduction. The following actions were taken: Issuer: MCS AMS Sub-Holdings LLC Corporate Family Rating, Downgraded to B3 from B2 Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Senior Secured Revolving Credit Facility due 2018, Downgraded to B3 from B2 Senior Secured Term Loan due 2019, Downgraded to B3 from B2 Outlook, Revised to Negative from Stable 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. MCS AMS, controlled by affiliates of TDR Capital, provides property inspection and preservation services on behalf of lenders and loan servicers for homes with defaulted mortgage loans and on behalf of the owners of REO residential properties. MEDICURE INC: To Issue 205,867 Common Shares for Debt ----------------------------------------------------- Medicure Inc., subject to all necessary regulatory approvals, has entered into shares for debt agreements with its Chief Executive Officer, Dr. Albert Friesen and certain members of the Board of Directors, pursuant to which the Company will issue 205,867 of its common shares at a deemed price of $1.98 per common share to satisfy $407,616 of outstanding amounts owing to Dr. Friesen and members of the Company's Board of Directors. These shares will be subject to resale restrictions for a period of four months from the date of issuance under applicable securities legislation. About Medicure Inc. Based in Winnipeg, Manitoba, Canada, Medicure Inc. (TSX/NEX: MPH.H) -- http://www.medicure.com/-- is a biopharmaceutical company engaged in the research, development and commercialization of human therapeutics. The Company has rights to the commercial product, AGGRASTAT(R) Injection (tirofiban hydrochloride) in the United States and its territories (Puerto Rico, U.S. Virgin Islands, and Guam). AGGRASTAT(R), a glycoprotein GP IIb/IIIa receptor antagonist, is used for the treatment of acute coronary syndrome (ACS) including unstable angina, which is characterized by chest pain when one is at rest, and non-Q-wave myocardial infarction. Medicure Inc. incurred a net loss of C$2.57 million on C$2.60 million of net product sales for the year ended May 31, 2013, as compared with net income of C$23.38 million on C$4.79 million of net product sales during the prior fiscal year. The Company's balance sheet at Nov. 30, 2013, showed C$3.25 million in total assets, C$8.52 million in total liabilities and a C$5.27 million total deficiency. Ernst & Young, LLP, in Winnipeg, Canada, issued a "going concern" qualification on the consolidated financial statements for the year ended May 31, 2013. The independent auditors noted that Medicure Inc. has experienced losses and has accumulated a deficit of $125,877,356 since incorporation and a working capital deficiency of $2,065,539 as at May 31, 2013 that raises substantial doubt about its ability to continue as a going concern. METRO AFFILIATES: Wayzata Stipulation Resolves Wind-Down Matters ---------------------------------------------------------------- Metro Affiliates, Inc., et al., notified the Bankruptcy Court of a stipulation resolving certain wind-down issues and amending the Liquidating Trust Agreement. On June 11, 2014, the Court entered an order confirming the First Amended Joint Plan of Liquidation proposed by the Debtors and the Official Committee of Unsecured Creditors. The Debtors relate that the stipulation dated June 30, was in the furtherance of the confirmation order and Plan. Parties to the stipulation are: (i) the Debtors, (ii) Wayzata Opportunities Fund, LLC, Wayzata Opportunities Fund II, L.P., Wayzata Recovery Fund, LLC, Wayzata Opportunities Fund Offshore, L.P., and Wayzata Opportunities Fund Offshore II, L.P., (iii) The Bank of New York Mellon, as indenture trustee and collateral agent for the Notes, on behalf of the holders of the (a) New Senior Secured Notes issued by AETC on Oct. 19, 2009, in the original principal amount of $90 million, and (b) the Senior Secured PIK Notes issued by AETC in the aggregate principal amount of $65,423,638, and (iv) the Official Committee of Unsecured Creditors in the chapter 11 cases. The stipulation provides that in connection with the global settlement, the noteholders consented to the use of their cash collateral. The Debtors had identified additional wind-down expenses that have not been accounted for in the DIP budget. A copy of the agreement is available for free at: http://bankrupt.com/misc/METROAFF_1430_agreementamendment.pdf The Plan creates a trust for unsecured creditors who are given the right to pursue lawsuits. Recoveries will be shared, with 70% going to noteholders on their remaining claim of $14.3 million and 30% earmarked for other unsecured creditors. About Metro Affiliates Staten Island, New York-based Metro Affiliates, Inc., and its subsidiaries sought protection under Chapter 11 of the Bankruptcy Code on Nov. 4, 2013 (Bankr. S.D.N.Y. Case No. 13-13591). The case is assigned to Judge Sean Lane. In its schedules, Metro Affiliates disclosed $14,438,351 in total assets and $163,562,007 total liabilities. Lisa G. Beckerman, Esq., and Rachel Ehrlich Albanese, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York; and Scott L. Alberino, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Washington, D.C., represent the Debtors. Silverman Shin & Byrne PLLC serves as special counsel. Rothschild Inc. serves as the Debtors' investment banker, while Kurtzman Carson Consultants LLC serves as their claims and noticing agent. The Joint Chapter 11 Plan of Liquidation filed by Metro Affiliates, Inc. and its debtor affiliates embodies a global settlement among the Debtors, the Creditors Committee, Wells Fargo and Wayzata for a fair allocation of the Debtors' remaining assets. Wayzata holds a substantial majority of the Debtors' Notes. Among other things, the Settlement provides that proceeds of the Noteholders' Collateral will be used to pay certain administrative expenses. Wells Fargo Bank, National Association, as agent for a consortium of DIP lenders, is represented by Jonathan N. Helfat, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., in New York. The Bank of New York Mellon as indenture trustee and collateral agent for prepetition noteholders, is represented by James Gadsden, Esq., at Carter, Ledyard & Milburn LLP, in New York. Certain Noteholders are represented by Kristopher M. Hansen, Esq., at Stroock & Stroock & Lavan LLP, in New York. The U.S. appointed a three-member official committee of unsecured creditors represented by Farrell Fritz, P.C. PricewaterhouseCoopers LLP serves as the Committee's Financial advisors. This is Metro Affiliates' third trip to Chapter 11. The Company, together with its subsidiaries, previously sought protection under Chapter 11 of the Bankruptcy Code on Aug. 16, 2002 (In re Metro Affiliates, Inc., Case No. 02-42560 (PCB), Bankr. S.D.N.Y.). A plan in the second Chapter 11 case was confirmed in September 2003. The first bankruptcy was in 1994. MOBIVITY HOLDINGS: Amends 23.5MM Shares Resale Prospectus --------------------------------------------------------- Mobivity Holdings Corp. amended its registration statement as filed with the U.S. Securities and Exchange Commission relating to the sale by Sandor Capital Master Fund, Trellus Partners LP, Cornelis F. Wit, et al., of up to 23,577,949 shares of the Company's common stock, which amount includes 7,056,793 shares to be issued to the selling stockholders only if and when they exercise warrants held by them. Although the Company will incur expenses in connection with the registration of the common stock, the Company will not receive any of the proceeds from the sale of the shares of common stock by the selling stockholders. The Company will receive gross proceeds of up to $8,468,152 from the exercise of the warrants, if and when they are exercised. The Company's common stock is quoted on the OTC Markets under the symbol "MFON". The last reported sale price of the Company's common stock as reported by the OTC Markets on July 10, 2014, was $1.15 per share . A full-text copy of the Form S-1 prospectus is available at: http://is.gd/GgsfIL About Mobivity Holdings Mobivity Holdings Corp. was incorporated as Ares Ventures Corporation in Nevada in 2008. On Nov. 2, 2010, the Company acquired CommerceTel, Inc., which was wholly-owned by CommerceTel Canada Corporation, in a reverse merger. Pursuant to the Merger, all of the issued and outstanding shares of CommerceTel, Inc., common stock were converted, at an exchange ratio of 0.7268-for-1, into an aggregate of 10,000,000 shares of the Company's common stock, and CommerceTel, Inc., became a wholly owned subsidiary of the Company. In connection with the Merger, the Company changed its corporate name to CommerceTel Corporation on Oct. 5, 2010. In connection with the Company's acquisition of assets from Mobivity, LLC, the Company changed its corporate name to Mobivity Holdings Corp. and its operating company to Mobivity, Inc, on Aug. 23, 2012. Mobivity Holdings reported a net loss of $16.75 million in 2013, a net loss of $7.33 million in 2012 and a net loss of $16.31 million in 2011. As of March 31, 2014, the Company had $13.96 million in total assets, $3.77 million in total liabilities and $10.18 million in total stockholders' equity. MORTGAGE LENDERS: N.J. Court Rules in Sales Reps' Lawsuit --------------------------------------------------------- Michael Meyers, David Rundella, David Bosefski, Scott Kerico, Marc Ambrose, Lisa Macone, Johanna Curley, and Jeffery DePalma sued Mitchell L. Heffernan and James E. Pedrick alleging that the defendants failed to pay them earned commissions, in violation of the New Jersey Wage Payment Law, N.J.S.A. 34:11-4.1 et seq. and the Sales Representatives' Rights Act, N.J.S.A. 2A:61A-1 et seq. The plaintiffs allege that they were employed as commissioned sales representatives by the now-defunct Mortgage Lenders Network USA, Inc., a mortgage banking company, until approximately February 2007. The plaintiffs filed the Complaint on February 18, 2010, seeking to hold the defendants personally liable for unpaid commissions they allegedly earned as employees of MLN. The plaintiffs claim that, sometime prior to February 2007, MLN stopped paying the plaintiffs earned commissions. The plaintiffs assert claims against the defendants for violations of the WPL and the SRRA. Messrs. Heffernan and Pedrick, as third-party plaintiffs, filed a third-party complaint against Steven Patton and Paul Impagliazzo, as "third-party defendants", pursuant to Federal Rule of Civil Procedure 14, for indemnification and contribution in the event they are held liable to the plaintiffs in the main action. Messrs. Patton and Impagliazzo, as "fourth-party plaintiffs", then filed a fourth-party complaint against Randal Roberge and Michael Simeone, as "fourth-party defendants", pursuant to Rule 14, for indemnification and contribution in the event they are held liable to the third-party plaintiffs or the plaintiffs. The defendants now move for summary judgment in their favor and against the plaintiffs, pursuant to Rule 56 (the "122 Motion"). The plaintiffs oppose the so-called 122 Motion. The third-party defendants move for judgment on the pleadings in their favor and against the third-party plaintiffs, pursuant to Rule 12(c) (the "121 Motion"). The third-party plaintiffs oppose the so-called 121 Motion. The fourth-party defendants counter-move for judgment on the pleadings in their favor and against the third-party defendants, pursuant to Rule 12(c) (the "125 Motion"). The fourth-party plaintiffs oppose the so-called 125 Motion. In a July 8, 2014 Memorandum Opinion available at http://is.gd/1bT2vEfrom Leagle.com, New Jersey District Judge Mary L. Cooper: (1) denied the defendants' motion for summary judgment; (2) grant the third-party defendants' motion for judgment on the pleadings; and (3) deny the fourth-party defendants' motion for judgment on the pleadings without prejudice as moot. The case is, MEYERS v. HEFFERNAN, CIVIL ACTION NO. 12-2434 (MLC) (D.N.J.). About Mortgage Lenders Middletown, Connecticut-based Mortgage Lenders Network USA Inc. -- http://www.mlnusa.com/-- was once the 15th largest mortgage lender in the United States. The Company filed for Chapter 11 protection on February 5, 2007 (Bankr. D. Del. Case No. 07-10146). Pachulski Stang Ziehl & Jones LLP represents the Debtor. Blank Rome LLP represents the Official Committee of Unsecured Creditors. In the Debtor's schedules of assets and liabilities filed with the Court, it disclosed total assets of $464,847,213 and total debts of $556,459,464. The Honorable Peter J. Walsh approved the Company's the First Amended Plan of Liquidation as Modified on February 3, 2009. A full-text copy of the Debtor's First Amended Liquidating Plan under Chapter 11 of the Bankruptcy Code, dated December 19, 2008, is available at http://is.gd/1a3YGat no charge. On July 19, 2011, the Bankruptcy Judge entered an Order approving the final distributions, including distributions to most of the plaintiffs, in the MLN Bankruptcy Case. MMRGLOBAL INC: Unit Inks License Agreement with Claydata -------------------------------------------------------- MMRGlobal, Inc., through its wholly owned subsidiary, MyMedicalRecords, Inc., and Claydata(R) jointly announced the signing of a patent license agreement. Pursuant to the terms of the Agreement, Claydata received a non-exclusive license to the Company's family of patents, and the right to resell the Company's MyMedicalRecords Personal Health Record or utilize selected features in the MMR-PHR in Australia, New Zealand and the US. The agreement was signed following a week of meetings with the private sector and Australian officials, including Prime Minister Tony Abbott, in connection with a program designed to generate revenue in Australia through a private sector business cooperation initiative between the United States and Australia. The program focuses on economics, sustainability, tourism, music & entertainment, food & wine, arts & culture, defense, political partnerships, healthcare, technology and other commercial opportunities. The meetings also focused on opportunities in the Trans-Pacific Partnership which includes 12 member countries, of which MMR owns relevant health IT patents and other intellectual property in seven of them, specifically, the United States, Australia, Canada, Japan, Mexico, New Zealand, and Singapore. Claydata, headed by CEO Joseph Grace, M.D., is a leading Australian health information technology provider based in Sydney and provides its eHealth products and services to a number of healthcare organizations from over 800 referring doctors, many of which utilize Personal Health Record (PHR) services from Claydata that will fall under the license agreement. Dr. Joseph Grace said, "There are tremendous changes in healthcare going on in Australia and throughout the Asia Pacific region. This agreement gives Claydata the opportunity to sell our interoperable systems to customers with a license to MMR's IP. The agreement also gives Claydata the right to resell MMR's MyMedicalRecords product to the clients we serve." About MMRGlobal Los Angeles, Calif.-based MMR Global, Inc. (OTC BB: MMRF) -- http://www.mmrglobal.com/-- through its wholly-owned operating subsidiary, MyMedicalRecords, Inc., provides secure and easy-to- use online Personal Health Records (PHRs) and electronic safe deposit box storage solutions, serving consumers, healthcare professionals, employers, insurance companies, financial institutions, and professional organizations and affinity groups. MMRGlobal reported a net loss of $7.63 million in 2013, as compared with a net loss of $5.90 million in 2012. The Company's balance sheet at March 31, 2014, showed $2.23 million in total assets, $10.30 million in total liabilities and a $8.07 million total stockholders' deficit. Rose, Snyder & Jacobs LLP, in Encino, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred significant operating losses and negative cash flows from operations during the years ended December 31, 2013 and 2012. These conditions raise substantial doubt about the Company's ability to continue as a going concern. MT. GOX: Bitcoin Joint Venture to Bid for Assets ------------------------------------------------ Takashi Mochizuki, writing for The Wall Street Journal, reported that a joint venture between a Chinese and American company plans to launch a new bitcoin exchange in Japan by August, attempting to fill the void left by the collapse of Mt. Gox, once the world's largest trading platform for the crypto-currency. According to the report, BitOcean, a Beijing-based bitcoin ATM maker, will team up with Atlas ATS, a New York-based exchange platform provider that has worked for large Wall Street financial institutions. The new venture -- BitOcean Japan -- also hopes to purchase the assets of Tokyo-based Mt. Gox, which stopped operating in February and filed for protection from creditors under Japan's bankruptcy code, the report related. While BitOcean Japan hopes to craft its new exchange around the remains of Mt. Gox, one of the founders of the new venture said they would create the Japan-based exchange even if the trustee overseeing the Mt. Gox case doesn't accept BitOcean's bid, the report further related. About Mt. Gox Bitcoin exchange MtGox Co., Ltd., filed a petition under Chapter 15 of the U.S. Bankruptcy Code on March 9, 2014, days after the company sought bankruptcy protection in Japan. The bankruptcy in Japan came after the bitcoin exchange lost 850,000 bitcoins valued at about $475 million "disappeared." The Japanese bitcoin exchange that halted trading in February 2014. It filed for bankruptcy protection in the U.S. to prevent customers from targeting the cash it holds in U.S. bank accounts. The Chapter 15 case is In re MtGox Co., Ltd., Case No. 14-31229 (Bankr. N.D. Tex.). The Chapter 15 Petitioner is Robert Marie Mark Karpeles, the company's chief executive officer. Mr. Karpeles is represented by John E. Mitchell, Esq., and David William Parham, Esq., at Baker & Mcckenzie LLP, in Dallas, Texas. The company said it has estimated assets of $10 million to $50 million and debts of $50 million to $100 million. NATURAL MOLECULAR: Approved to Finance Liability Insurance Policy ----------------------------------------------------------------- Bankruptcy Judge Marc Barreca authorized Natural Molecular Testing Corporation to substitute and finance its liability insurance policy pursuant to Sections 105(a) and 364(c) of the Bankruptcy Court. The Debtor, in its motion, stated that it obtained General Liability, Professional Liability, and Umbrella policies through Willis of Seattle, Inc. at a time when its testing volumes were at an all-time high. The policy period ran from July 5, 2013 to August 2014. The total yearly premium for this policy was $102,543. Since Natural Molecular's ongoing testing services have decreased, and its work force has been reduced, Natural Molecular's current liability policy coverage is not cost effective. The Debtor has found a much more cost effective liability insurance policy issued by Evanston Insurance Company. The new General and Professional Liabilities Policies effective dates are May 5, 2014, to May 5, 2015. The policy limits are $1,000,000 per incident and $3,000,000 aggregate, which is consistent with the Debtor's prior general and professional liability coverage. The proposed yearly premium will be in the amount of $31,651, a savings of approximately $70,000 per year, on the underlying liability policy alone, and which premium will be financed through IPFS Corporation for a total finance charge of $674 (or 9.75%). In order to finance the premium, IPFS requires a security interest in the policy as set forth in the financing agreement and allowance of a priority administrative claim. The Debtor was unable to obtain financing for this policy on an unsecured basis. According to the Debtor, the new policy represents a significant cost savings going forward and the financing terms are reasonable. It is imperative for the Debtor to substitute its liability insurance policy with Evanston Insurance Company in order to reduce its costs while maintaining adequate coverage for its operations and to do so it requires financing of the yearly premium. In the event that the Debtor defaults under the terms of the agreement, IPFS may, without further Court order, cancel the policies listed in the agreement or any amendment thereto and receive and apply or return the unearned premiums to the account of the Debtor. The Debtor is represented by: Arnold M. Willig, Esq. Elizabeth H. Shea, Esq. Charles L. Butler, III, Esq. HACKER & WILLIG, INC., P.S. 520 Pike Street, Suite 2500 Seattle, Washington 98101 Tel: (206) 340-1935 About Natural Molecular Natural Molecular Testing Corp., which provides molecular diagnostic-testing services, including testing for sexually transmitted diseases and screening and counseling about cystic fibrosis, filed a petition for Chapter 11 protection (Bankr. W.D. Wash. Case No. 13-19298) on Oct. 21, 2013, in Seattle. Hacker & Willig, Inc., P.S., serves as its bankruptcy counsel. The closely held company said assets are worth more than $100 million while debt is less than $50 million. The U.S. Trustee for Region 18 appointed a five-member Committee of Unsecured Creditors. Foster Pepper's Jane Pearson, Esq.; Christopher M. Alston, Esq., and Terrance Keenan, Esq., serve as the Committee's attorneys. NATURAL MOLECULAR: Explore Consulting Added as Committee Member --------------------------------------------------------------- Gail Brehm Geiger, Acting U.S. Trustee for Region 18, for the second time, amended the members of the Official Committee of Unsecured Creditors in the Chapter 11 case of Natural Molecular Testing Corporation. According to the Trustee, Explore Consulting, LLC has been added to the Committee to replace creditor AutoGenomics, Inc., which withdrew from the Committee effective March 17, 2014. The members of the Committee are: 1. Camber Health Partners Attn: Stephanie Bloomfield, attorney - chair GORDON THOMAS HONEYWELL 1201 Pacific Avenue, Suite 2100 Tacoma, WA 98402 Tel: (253) 620-6514 Fax: (253) 620-6565 E-mail: sbloomfield@gth-law.com 2. GenoPath Solutions, LLC Attn: William M. Hancock, attorney WOLFE, JONES, CONCHIN, WOLFE, HANCOCK & DANIEL, LLC 905 Bob Wallace Avenue Huntsville, AL 35801 Tel: (256) 534-2205 Fax: (256) 519-6691 E-mail: bankruptcy@wolfejones.com 3. Pharmacogenomics Testing, LLC Attn: Charlie Rodkey, managing member 25806 Lewis Ranch Road New Braunfels, TX 78132 Tel: (210) 218-8610 E-mail: crrodkey@gmail.com 4. Honolulu Blue Ventures, LLC Attn: Jim Grossi, managing member 25 Ionia SW, Suite 503 Grand Rapids, MI 49503 Tel: (248) 425-3880 E-mail: jgrossi@hbvusa.com 5. Explore Consulting, LLC Attn: JuliAn Coy, VP, Client Services 10900 NE 8th Street, Suite 200 Bellevue, WA 98004 Tel: (425) 462-0100 Fax: (425) 650-8500 E-mail: jcoy@exploreconsulting.com As reported in the Troubled Company Reporter on April 15, 2014, the Committee consisted of: 1. Camber Health Partners 2. GenoPath Solutions, LLC 3. Pharmacogenomics Testing, LLC 4. Honolulu Blue Ventures Natural Molecular Testing Corp., which provides molecular diagnostic-testing services, including testing for sexually transmitted diseases and screening and counseling about cystic fibrosis, filed a petition for Chapter 11 protection (Bankr. W.D. Wash. Case No. 13-19298) on Oct. 21, 2013, in Seattle. Arnold M. Willig, Esq., Elizabeth H. Shea, Esq., and Charles L. Butler, III, Esq., at Hacker & Willig, INC., P.S., serve as the Debtor's bankruptcy counsel. The closely held company said assets are worth more than $100 million while debt is less than $50 million. The U.S. Trustee for Region 18 appointed a five-member Committee of Unsecured Creditors. Foster Pepper's Jane Pearson, Esq.; Christopher M. Alston, Esq., and Terrance Keenan, Esq., serve as the Committee's attorneys. NATURAL MOLECULAR: Court Denied Motion to Remove Committee Members ------------------------------------------------------------------ Bankruptcy Judge Marc L. Barreca denied Natural Molecular Testing Corporation's motion to remove GenoPath Solutions, LLC (John Stoddard), and Pharmacogenomics Testing, LLC (Charles Rodkey), as members of the Official Unsecured Creditors' Committee. The Court concluded that the Debtor has not met its burden to demonstrate grounds that any members of the Committee must be removed. The Debtor, in support of its motion, stated that the basis for the relief is the creditors' conflicts of interest. Gail Brehm Geiger, the Acting U.S. Trustee for Region 18, objected to the Debtor's motion for removal of Committee members, stating that under present law, the Court may only modify the membership of the Committee if the Court determines that a change is necessary to ensure adequate representation of creditors. The Committee submitted a sur-reply to strike the supplemental declaration of Kenneth Webert in support of the Debtor's motion, stating that the Debtor did not present any evidence with the motion showing how or why it disputes the claims of the two creditors. The other members of the Committee opposed the motion, saying the Committee has met its fiduciary duties to act in the best interests of unsecured creditors. About Natural Molecular Natural Molecular Testing Corp., which provides molecular diagnostic-testing services, including testing for sexually transmitted diseases and screening and counseling about cystic fibrosis, filed a petition for Chapter 11 protection (Bankr. W.D. Wash. Case No. 13-19298) on Oct. 21, 2013, in Seattle. Arnold M. Willig, Esq., Elizabeth H. Shea, Esq., and Charles L. Butler, III, Esq., at Hacker & Willig, INC., P.S., serve as the Debtor's bankruptcy counsel. The closely held company said assets are worth more than $100 million while debt is less than $50 million. The U.S. Trustee for Region 18 appointed a five-member Committee of Unsecured Creditors. Foster Pepper's Jane Pearson, Esq.; Christopher M. Alston, Esq., and Terrance Keenan, Esq., serve as the Committee's attorneys. NATURAL MOLECULAR: MedTech Approved to Collect Past Due Accounts ---------------------------------------------------------------- The Bankruptcy Court approved Natural Molecular Testing Corporation's agreement with MedTech National, Inc. as third-party billing firm to collect on past due accounts receivable. Under the Agreement, the Debtor will make four initial installment payments of $5,000 to MedTech to cover upfront costs. Thereafter, MedTech will be entitled to a percentage of the funds collected on past due accounts pursuant to a sliding scale, ranging from up to 50% (for the first $200,000 collected only) down to 5% (for any amounts collected over $3,000,001). The agreement was executed in the normal course of the Debtor's business and represents an arms- length transaction. Working with a third-party firm to collect past due insurance amounts is an ordinary course business transaction for a laboratory testing facility such as Natural Molecular. As reported in the Troubled Company Reporter on May 9, 2014, the Debtor and MedTech anticipate that collection efforts would start promptly and revenue would be available to Natural Molecular starting within 60 to 90 days. The Debtor has selected MedTech because it has considerable medical billing experience and employs a wide range of technologies to increase efficiency, reduce billing errors, and shorten recovery time on past due accounts. Natural Molecular Testing Corp., which provides molecular diagnostic-testing services, including testing for sexually transmitted diseases and screening and counseling about cystic fibrosis, filed a petition for Chapter 11 protection (Bankr. W.D. Wash. Case No. 13-19298) on Oct. 21, 2013, in Seattle. Arnold M. Willig, Esq., Elizabeth H. Shea, Esq., and Charles L. Butler, III, Esq., at Hacker & Willig, INC., P.S., serve as the Debtor's bankruptcy counsel. The closely held company said assets are worth more than $100 million while debt is less than $50 million. The U.S. Trustee for Region 18 appointed a five-member Committee of Unsecured Creditors. Foster Pepper's Jane Pearson, Esq.; Christopher M. Alston, Esq., and Terrance Keenan, Esq., serve as the Committee's attorneys. NEWLEAD HOLDINGS: Says Ironridge's Actions Damaging to Holders -------------------------------------------------------------- NewLead Holdings Ltd.'s management believes that Ironridge Global IV, Ltd.'s requests of no more than 9.99% of the outstanding shares of the Company on almost a daily basis and immediately selling those shares into the market is damaging to NewLead's shareholders and an abuse of an irrevocable instruction letter all pursuant to documentation that is subject to an arbitration. From April 11, 2014 to July 11, 2014, Ironridge received approximately 125 million shares, 46.3 million of which have been requested but not issued, and are therefore not included in the shares outstanding. As of July 6, 2014, Ironridge had received or requested approximately 62 million common shares pursuant to numerous conversions of the Series A Preference Shares pursuant to an irrevocable instruction letter that the Company believes Ironridge continues to abuse. To this end, since July 7, 2014, Ironridge has requested an additional 63 million common shares, "further evidencing it never has been and never intended to be a long term investor despite its assertions to the contrary," the Company said in a regulatory filing with the U.S. Securities and Exchange Commission. As of July 10, 2014, the Company had approximately 274.5 million shares outstanding. About NewLead Holdings Ltd. Based in Athina, Greece, NewLead Holdings Ltd. -- http://www.newleadholdings.com/-- is an international, vertically integrated shipping company that owns and manages product tankers and dry bulk vessels. NewLead currently controls 22 vessels, including six double-hull product tankers and 16 dry bulk vessels of which two are newbuildings. NewLead's common shares are traded under the symbol "NEWL" on the NASDAQ Global Select Market. NewLead Holdings reported a net loss of $158.22 million on $7.34 million of operating revenues for the year ended Dec. 31, 2013, as compared with a net loss of $403.92 million on $8.92 million of operating revenues in 2012. The Company's balance sheet at Dec. 31, 2013, showed $151.33 million in total assets, $292.68 million in total liabilities and a $141.34 million total shareholders' deficit. EisnerAmper LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred a net loss, negative operating cash flows, a working capital deficiency, and shareholders' deficiency and has defaulted under its credit facility agreements. Those conditions raise substantial doubt about the Company's ability to continue as a going concern. NGL ENERGY: TransMontaigne Deal No Impact on Fitch IDR ------------------------------------------------------ Fitch Ratings does not expect to change NGL Energy Partners LP's (NGL) 'BB' Issuer Default Rating (IDR) or 'BB-' senior unsecured rating following the company's announcement that it has offered to acquire the remaining limited partnership units of TransMontaigne Partners L.P. (TransMontaigne Partners) in a unit-for-unit exchange. The offer is non-binding and subject to a definitive agreement. In addition, approval is needed from the conflicts committee of the board of TransMontaigne Partners GP L.L.C., followed by board and unitholder approval. Fitch views the potential increase in size and scale as favorable from a credit perspective provided NGL manages the balance sheet. Consolidation of TransMontaigne Partners would simplify NGL's structure and provide for additional growth opportunities. The potential acquisition involves NGL acquiring approximately 80.3% of TransMontaigne Partners since it already owns 19.7% of the LP units. In total, NGL would acquire approximately 12.9 million units currently valued at $562 million. On July 2, NGL acquired TransMontaigne Inc. (which held the GP for TransMontaigne Partners), 19.7% of the outstanding LP units of TransMontaigne Partners, and certain associated entities for approximately $200 million in cash. The 'BB' rating is supported by NGL's strategy to operate with strong distribution coverage and diverse operations which are located throughout the U.S. Since NGL has significant senior secured debt ahead of the senior unsecured debt, the unsecured debt is notched down to 'BB-'. Concerns include NGL's short operating history and growth through numerous acquisitions since it was formed in 2010 and IPO'd in 2011. Fitch believes that acquisitions will continue to be significant for NGL as it seeks to expand its operations and increase distributions paid to unitholders. Other concerns include NGL's modest size, and the weather-linked volatility associated with the company's retail propane business which accounted for 34% of fiscal year 2014 (FY2014) EBITDA. Following significant acquisition activity in FY2014, leverage as defined by Fitch as total debt to adjusted EBITDA was 6.4x as of FY2014 (fiscal year ends March 31), up from 4.2x at the end of FY2013. With the pending acquisition, Fitch forecasts leverage to be approximately 4.5x-5.0x at the end of FY2015 as recent past acquisitions contribute to EBITDA growth which should drive the leverage reduction. Furthermore, Fitch expects EBITDA growth to be more significant in the latter half of FY2015. Leverage expectations are viewed as appropriate by Fitch for NGL's 'BB' rating. Given NGL's aggressive acquisition strategy, maintenance of its rating will in large part depend on its willingness and ability to issue equity to help fund growth. NGL is focused on significant growth via organic projects and acquisitions. Fitch expects acquisitions to be NGL's larger focus as it enables the partnership to quickly ramp up in size and scale. The offset to this is that multiples paid for acquisitions are higher than organic growth projects. Prior to the completed acquisition on July 2, management indicated that adjusted EBITDA should be in the range of $425 million-$430 million in FY2015, up from $255 million in FY2014. In FY2015, it expects to see growth capex of approximately $500 million, up from $133 million in FY2014. In the current fiscal year, approximately 50% of spending is to be directed toward crude logistics, 40% water services and the remainder is for other NGL logistic projects. In FY2014, $1.3 billion of cash was spent on acquired assets. The most significant acquisition during the fiscal year was the December 2013 acquisition of the Gavilon assets which included crude oil terminals and a 50% stake in a crude oil pipeline which went into service in February 2014. NGL paid $832 million net in cash for the assets. Following the June bond offering of $350 million and equity offering of $338 million, liquidity appears to be adequate. Proceeds from both offerings were used to reduce revolver borrowings. As of year-end FY2014, cash on the balance sheet was approximately $10 million, the working capital facility had approximately $275 million undrawn and the expansion facility had $253 million undrawn. In late 2013, NGL increased the size of its secured revolving credit facility to $1.721 billion from $1.67 billion. The bank agreement is comprised of two facilities: a $935.5 million working capital facility which is restricted by a borrowing base and a $785.5 million expansion capital facility. The facility extends until 2018. Financial covenants in the bank agreement do not allow leverage (as defined by the bank agreement) to exceed 4.25x. With permitted acquisitions, this temporarily increases to 4.5x. As of FY2014, the bank-defined leverage ratio was approximately 3.0x. Interest coverage must exceed 2.75x and it was approximately 7.0x at the end of FY2014. The bank agreement allows working capital borrowings and letters of credit to be excluded from the leverage calculation. NGL gets pro forma EBITDA credit for acquisitions, which is typical for master limited partnership (MLP) bank agreements. The borrowing base is the sum of: all cash collateral, 85% of accounts receivable, 80% of inventory (less 50% of prepaid inventory), 90% of eligible futures accounts, and 80% of letters of credit for commodities not yet received, less all first purchaser liability, less 100% of secured bank obligations attributable to overdrafts, less 120% of secured hedging obligations, and less 100% of excise tax liabilities. The borrowing base calculation is done at the end of each month. The company maintains a solid distribution coverage ratio (DCR) which it targets to be approximately 1.5x. With increased distributions, the coverage ratio was 1.1x at the end of FY2014 which is below coverage of 1.5x at the end of FY2013 and management's target. Fitch forecasts EBITDA and DCF growth in FY2015 and expects the DCR to be closer to 1.5x at the end of the current fiscal year. NGL has indicated that in FY2014, approximately 40%-45% of EBITDA was generated from fee-based assets. It targets 60% of EBITDA from fee-based assets in the next 12-18 months. NGL's assets are diverse and are comprised of retail propane (34% of FY2014 segment EBITDA), water services (24%), liquids (31%), crude logistics (8%) and other (3%). Furthermore, its assets are located throughout the U.S. Recent acquisitions include crude oil midstream assets (Gavilon) and water services. These are higher margin segments which should improve NGL's overall EBITDA margins going forward. NII HOLDINGS: BlackRock Lowers Equity Stake to 2.7% --------------------------------------------------- BlackRock, Inc., disclosed in an amended Schedule 13G filed with the U.S. Securities and Exchange Commission that as of June 30, 2014, it beneficially owned 4,569,576 shares of common stock of NII Holdings representing 2.7 percent of the shares oustanding. BlackRock previously owned 23,937,400 shares at March 31, 2014. A full-text copy of the regulatory filing is available for free at http://is.gd/ZWeAGO About NII Holdings With headquarters in Reston, Virginia, NII Holdings is an international wireless operator with more than 7 million largely post-pay, business subscribers. As of March 31, 2014, the Company had $8.18 billion in total assets, $8.19 billion in total liabilities and a $8.76 million total stockholders' deficit. Bankruptcy Warning "We believe we are currently in compliance with the requirements under all of our financing arrangements, including the indentures for our senior notes, our equipment financing facilities and our local bank financing agreements. In light of the probability that, absent a waiver or amendment, we will be unable to meet the financial covenants in the equipment financing facilities and the local bank financing agreements as of the next compliance date, there is no guarantee that the lender of our equipment financing facilities will continue to fund additional requests under these facilities. In addition, a holder of more than 25% of our 8.875% senior notes, issued by NII Capital Corp. and due December 15, 2019, has provided a notice of default in connection with these notes. We believe that the allegations contained in the notice are without merit. "If we are unable to meet our debt service obligations or to comply with our other obligations under our existing financing arrangements: * the holders of our debt could declare all outstanding principal and interest to be due and payable; * the holders of our secured debt could commence foreclosure proceedings against our assets; * we could be forced into bankruptcy or liquidation; and * debt and equity holders could lose all or part of their investment in us," the Company said in the Quarterly Report for the period ended March 31, 2014. * * * As reported by the TCR on March 5, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating on Reston, Va.-based wireless carrier NII Holdings Inc. (NII) to 'CCC' from 'CCC+'. "The downgrade follows the company's poor fourth-quarter 2013 results that were below our expectations, and its disclosure that its auditors have uncertainty about the company's ability to continue as a going concern," said Standard & Poor's credit analyst Allyn Arden. The TCR also reported on March 5, 2014, that Moody's Investors Service downgraded the corporate family rating (CFR) of NII Holdings Inc. ("NII" or "the company") to Caa1 from B3. The downgrade reflects the company's poor 2013 operating performance and the risk that the company will violate the covenants governing its Mexican and Brazilian subsidiary debt, which could trigger an event of default for up to $4.4 billion of debt issued by intermediate holding companies NII Capital Corp. and NII International Telecom S.C.A. NII HOLDINGS: FMR LLC Stake Down to Less Than 1% ------------------------------------------------ In an amended Schedule 13G filed with the U.S. Securities and Exchange Commission on July 9, 2014, FMR LLC, Edward C. Johnson 3d and Abigail P. Johnson disclosed that they beneficially owned 469,200 shares of common stock of NII Holdings representing 0.272% of the shares outstanding. A full-text copy of the regulatory filing is available for free at http://is.gd/qEjwmX About NII Holdings With headquarters in Reston, Virginia, NII Holdings is an international wireless operator with more than 7 million largely post-pay, business subscribers. As of March 31, 2014, the Company had $8.18 billion in total assets, $8.19 billion in total liabilities and a $8.76 million total stockholders' deficit. Bankruptcy Warning "We believe we are currently in compliance with the requirements under all of our financing arrangements, including the indentures for our senior notes, our equipment financing facilities and our local bank financing agreements. In light of the probability that, absent a waiver or amendment, we will be unable to meet the financial covenants in the equipment financing facilities and the local bank financing agreements as of the next compliance date, there is no guarantee that the lender of our equipment financing facilities will continue to fund additional requests under these facilities. In addition, a holder of more than 25% of our 8.875% senior notes, issued by NII Capital Corp. and due December 15, 2019, has provided a notice of default in connection with these notes. We believe that the allegations contained in the notice are without merit. "If we are unable to meet our debt service obligations or to comply with our other obligations under our existing financing arrangements: * the holders of our debt could declare all outstanding principal and interest to be due and payable; * the holders of our secured debt could commence foreclosure proceedings against our assets; * we could be forced into bankruptcy or liquidation; and * debt and equity holders could lose all or part of their investment in us," the Company said in the Quarterly Report for the period ended March 31, 2014. * * * As reported by the TCR on March 5, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating on Reston, Va.-based wireless carrier NII Holdings Inc. (NII) to 'CCC' from 'CCC+'. "The downgrade follows the company's poor fourth-quarter 2013 results that were below our expectations, and its disclosure that its auditors have uncertainty about the company's ability to continue as a going concern," said Standard & Poor's credit analyst Allyn Arden. The TCR also reported on March 5, 2014, that Moody's Investors Service downgraded the corporate family rating (CFR) of NII Holdings Inc. ("NII" or "the company") to Caa1 from B3. The downgrade reflects the company's poor 2013 operating performance and the risk that the company will violate the covenants governing its Mexican and Brazilian subsidiary debt, which could trigger an event of default for up to $4.4 billion of debt issued by intermediate holding companies NII Capital Corp. and NII International Telecom S.C.A. OHI INTERMEDIATE: S&P Lowers CCR to 'B', Removed From CreditWatch ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Buffalo, N.Y.-based OHI Intermediate Holdings Inc. to 'B' from 'B+' and removed the rating from CreditWatch, where S&P had placed it with negative implications on April 24, 2014. The outlook is stable. At the same time, S&P assigned its 'B' issue-level rating and '3' recovery rating to Osmose Holdings Inc.'s proposed $25 million revolver due 2019 and $235 million second-lien loan due 2021. Osmose is a subsidiary of OHI. The '3' recovery rating reflects S&P's expectation for meaningful recovery (50%-70%) in the event of a payment default. S&P will withdraw the ratings on Osmose's existing credit facility following full repayment upon the close of the transaction. "The downgrade reflects OHI's weaker credit measures because of the company's sale of its wood preservation and railroad services businesses, and its subsequent debt refinancing," said Standard & Poor's credit analyst Robyn Shapiro. "Pro forma for the transaction, we expect debt to EBITDA of about 5x." S&P assess the equity sponsor's financial policy as "aggressive," reflecting the payment of two debt-financed dividends and the proposed sale of more than half of the business within less than two years after OHI was acquired. OHI provides utility transmission and distribution and communications infrastructure inspection, treatment, restoration, and engineering services across the U.S. About two-thirds of revenues are from utility pole inspection, treatment, and restoration services for utilities and municipalities. Demand for the company's services comes from the utilities' regulations to ensure infrastructure safety and reliability. U.S. utility infrastructure is aging, and increasing utility outsourcing of needed maintenance should push continued growth in this business over the long term. The stable outlook reflects S&P's expectation that OHI will continue to generate positive free cash flow, with credit metrics that are consistent with a "highly leveraged" financial risk profile, such as debt to EBITDA of about 5x and FOCF to debt of about 5%. S&P expects modest improvements in credit metrics over the next few years, given the cash flow sweep requirement in the proposed term loan, S&P's assumptions for gradual EBITDA improvements, and its expectation that management will approach growth prudently. While unexpected, S&P could lower the rating on OHI during the next 12 months if FOCF becomes negative. This could occur as a result of an unexpected decline in operating performance due to weather, for example, or the adoption of a more aggressive growth plan. S&P also considers an upgrade unlikely because it believes the company's financial policies will remain "highly leveraged" under its private equity owners. OSMOSE HOLDINGS: Moody's Affirms 'B2' Corp. Family Rating --------------------------------------------------------- Moody's Investors Service has affirmed Osmose Holdings Inc.'s B2 Corporate Family Rating ("CFR") and assigned B2 ratings to the company's proposed senior secured credit facilities. The rating outlook is stable. "Expectations for more stable cash flows offset the modest increase in leverage and contraction of Osmose's business profile following the company's planned divestiture of two businesses," said Ben Nelson, Moody's Assistant Vice President and lead analyst for Osmose Holdings Inc. Osmose plans to sell the wood preservation chemicals and railroad services business to Koppers Holdings Inc. (Ba3 stable) for $460 million. Proceeds will be used to fund a distribution to the company's private equity sponsor and reduce secured debt from about $400 million to $235 million -- comprised of a new first lien senior secured term loan. The new term loan, along with an undrawn $25 million revolving credit facility, will be the preponderance of debt remaining in the capital structure. Moody's estimates relatively weak initial pro forma financial leverage in the low 5 times (Debt/EBITDA) and owing to low-cost bank debt, relatively strong interest coverage in the low 3 times (EBITDA- CapEx/Interest). Moody's believes that the company will have a more stable operating profile in the long-term despite a much-smaller revenue base following the completion of the proposed divestitures. The chemicals business being sold is tied to the cyclical housing industry, particularly residential remodeling; exposed to fluctuations in the price of copper, a key raw material for most products; and competes in an industry with uncertain competitive dynamics and much stronger competitors. The remaining utilities services business has more stable customers and favorable long- term trends including tightening regulatory requirements, aging utility infrastructure, and increased customer outsourcing of maintenance and repair services. New contract signings, combined with recent bolt-on acquisitions and modest reduction in corporate overhead consistent with the company's smaller profile, support Moody's expectation for revenue growth and margin expansion in 2014 and 2015. Moody's believes that the expected improvement in operating performance, combined with free cash flow in the mid single digit range (FCF/Debt), will enable the company to reduce leverage by at least a full turn by the end of 2015. However, the company's historical disposition toward acquisitions and shareholder returns suggest a willingness to use its balance sheet aggressively and loose terms of the covenant-lite credit facilities will enable the company to maintain these financial policies going forward. The company will not be required to comply with financial maintenance covenants unless the revolver is drawn by more than 25%, the point at which a springing leverage ratio test with equity cure rights would apply. The credit agreement is also expected to have a carve-out provisions allowing an additional $50 million (over 20% of the initial term loan size) without any incurrence test and unlimited additional debt subject to incurrence tests for both pari passu and junior debt. These factors limit the consideration given to the prospective improvement in key credit metrics. The actions: Issuer: Osmose Holdings, Inc. Corporate Family Rating, Affirmed B2; Probability of Default Rating, Affirmed B2-PD; $25 million Senior Secured Revolving Credit Facility, Assigned B2 (LGD4); $235 million Senior Secured Term Loan, Assigned B2 (LGD4); Outlook, Stable The assigned ratings remain subject to Moody's review of the final terms and conditions of the proposed transaction expected to close in the third quarter of 2014. The ratings on the company's existing senior secured credit facilities are expected to be withdrawn. PACIFIC THOMAS: Court Rules in Trustee Suit v. Trading Ventures --------------------------------------------------------------- Kyle Everett, Chapter 11 Trustee for Pacific Thomas Corporation sought declaratory relief regarding the validity of the lease agreement between PTC and Pacific Trading Ventures; an accounting, injunctive relief against PTV and individual defendants Randall Whitney and Jill Worsley; and turnover of books and records and funds owed to the estate. Subsequently, the court found that, without admitting its validity, the Trustee terminated the lease pursuant to its terms, and also terminated a management agreement for cause. On this basis, the court issued its Preliminary Injunction, which (a) required PTV to turn over all rent or other income received related to PTC property, (b) required PTV, Whitney and Worsley to turn over to the Trustee current and historical books and records related to the PTC property, and (c) restrained Whitney and Worsley from entering the property or interfering with the Trustee's transfer of management and operations of PTC's property from PTV to a new management company. At trial, the remaining issues were the validity of the lease and management agreements, whether such agreements (if valid) were terminated, and the Trustee's request for turnover of pre- and post-petition funds from PTV. If the Trustee prevails, the Trustee will further request that the preliminary injunction be made permanent. In a July 8, 2014 Decision After Trial, available at http://is.gd/LZlvolfrom Leagle.com, Bankruptcy Judge M. Elaine Hammond ruled that: (1) That the Lease Agreement was signed but never effectuated by PTC and PTV. As a result, enforcement of the Lease Agreement, Lease Extension and Lease Addendum was waived by the parties. If the Lease Agreement was ever valid, it was terminated by the Trustee by notice pursuant to its terms. (2) That the Management Agreement was the agreement by which the parties operated. This agreement was terminated by the Trustee for cause as of August 30, 2013, however, PTV continued to provide services through entry of the Preliminary Injunction. PTV is entitled to receive management fees through October 14, 2013 based upon the turnover of operations. (3) A final injunction should be entered consistent with the Preliminary Injunction providing for termination and turnover of PTV's business operations, prohibiting further involvement of Whitney, Worsley and other Restrained Parties (as defined in the Preliminary Injunction) in PTV's current business operations, and such further relief as ordered in the Preliminary Injunction. (4) The Trustee did not establish that PTC's estate is entitled to a judgment of $712,206 against PTV for a prepetition Note Receivable. (5) The Trustee established, and PTV did not rebut, that PTC's estate is entitled to a judgment of $566,685 against PTV for postpetition rents received and not turned over to PTC. The case is, Kyle Everett, Plaintiff, v. Randall Whitney, et al., Defendants, Adv. Proc. No. 13-04079 AH (Bankr. N.D. Calif.). About Pacific Thomas Corp. Walnut Creek, California, Pacific Thomas Corporation filed a Chapter 11 petition (Bankr. N.D. Cal. Case No. 12-46534) in Oakland on Aug. 6, 2012, estimating in excess of $10 million in assets and liabilities. The Debtor is related to Pacific Thomas Capital, which specializes in real estate services, focusing on the investment, ownership and development of commercial real estate properties, according to http://www.pacificthomas.com/ Real estate activities has spanned throughout the Hawaiian Islands as well as U.S. West Coast locations in California, Nevada, Arizona and Utah. Hawaii based activities are managed under the name Thomas Capital Investments. Bankruptcy Judge M. Elaine Hammond presides over the case. Anne- Leith Matlock, Esq., at Matlock Law Group, P.C., serves as general counsel. The petition was signed by Jill V. Worsley, COO, secretary. Kyle Everett was named Chapter 11 trustee of the Debtor. Craig C. Chiang, Esq., at Buchalter Nemer, P.C., in San Francisco, Calif., represents the Chapter 11 trustee as counsel. In its schedules, the Debtor disclosed $19,960,679 in assets and $16,482,475 in liabilities as of the petition date. In January 2014, Judge Hammond entered an order holding that Pacific Thomas Corp.'s Fourth Amended Disclosure Statement, filed on Dec. 31, 2013, is not approved for the reasons stated on the record at the Jan. 16 hearing. Pursuant to the Plan, the Debtor proposes to avail of a loan from Thorofare Capital to pay off some secured claims. The new loan would be refinanced by the reorganized company before the loan terms expires. If the reorganized company fails to do so, the safe storage parcels of the Pacific Thomas properties will be sold. PANACHE BEVERAGE: Receives Demand Notice From Natwest ----------------------------------------------------- In connection with a factoring agreement, dated Feb. 11, 2014, by and among Natwest Finance Limited, Wodka, LLC, Panache, LLC, and James Dale, Panache Beverage, Inc., received written notice from Natwest of demand for repayment of the aggregate principal amount and interest due of $190,032 as of June 30, 2014. Management disputes the claim made by Natwest and believes that it does not have merit. About Panache Beverage New York-based Panache Beverage, Inc., specializes in the strategic development and aggressive early growth of spirits brands establishing its assets as viable and attractive acquisition candidates for the major global spirits companies. Panache builds its brands as individual acquisition candidates while continuing to develop its pipeline of new brands into the Panache portfolio. Panache Beverage reported a net loss of $4.58 million in 2013 following a net loss of $3.27 million in 2012. The Company's balance sheet at March 31, 2014, showed $6.05 million in total assets, $14.36 million in total liabilities and a $8.31 million total deficit. In their report on the consolidated financial statements for the year ended Dec. 31, 2013, Silberstein Ungar, PLLC, expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company has limited working capital and has incurred losses from operations. PATRICK HANNON: IRS Bid for Disbursement of Proceeds Denied ----------------------------------------------------------- Bankruptcy Judge William C. Hillman denied the "Motion for Disbursement of Proceeds of Exempt Property Currently Held by Chapter 7 Trustee" filed by the United States of America, Internal Revenue Service, over the objections of (i) Joseph H. Baldiga, the Chapter 7 trustee for the estates of Patrick and Elizabeth Hannon; and (ii) the debtors. The IRS asserts that it is entitled to the proceeds of property sold by the Chapter 7 Trustee in which the Debtors had claimed an exemption pursuant to 11 U.S.C. Sec. 522(c)(2)(B). On December 15, 2011, the IRS filed a civil action against the Debtors in the U.S. District Court for the District of Maine, seeking a money judgment against the Debtors for their federal income tax liabilities for the years 1999, 2000, and 2001 and against Patrick Hannon for additional trust fund recovery penalties. Prior to filing the lawsuit, the IRS filed Notices of Federal Tax Lien with regard to the tax debts in the York County, Maine Registry of Deeds and with the Maine Secretary of State. The Hannons filed a voluntary Chapter 11 petition (Bankr. D. Mass. Case No. 12-13862) on May 3, 2012. On July 20, 2012, the IRS filed a proof of claim asserting claims totaling $8,014,490.74 against the Debtors, $7,999,244.98 of which was secured. On January 2, 2013, the Debtors' case was converted to one under Chapter 7. On January 18, 2013, the Trustee filed an adversary proceeding against the IRS, seeking to avoid a portion of the IRS's lien pursuant to 11 U.S.C. Sec. 724(a). In the complaint, the Trustee alleged that $2,639,218.09 of the IRS lien was avoidable as securing tax penalties, and an additional $2,578,327.71 of the IRS lien was avoidable as securing interest, which the IRS's proof of claim failed to show was compensation for actual pecuniary loss. By agreement of the parties, however, all pre-trial deadlines in the Avoidance Action were suspended until the Trustee completed his liquidation and recovery of estate assets. Throughout 2013, the Trustee liquidated much of the Debtors' real and personal property. According to Judge Hillman, the IRS's arguments are, in essence, premature. "The IRS is correct that, even if the Trustee is successful in the Avoidance Action, the entirety of its tax lien will survive as to the property claimed as exempt. Pursuant to [Sec.] 522(g), if the Trustee avoids the IRS lien on property in which the Debtors have claimed an exemption, the value of the avoided lien will accrue first to the Debtors exemptions, not the estate. Thus, once the Avoidance Action is completed, there may be sale proceeds which are exempted from the bankruptcy estate. Then, pursuant to [Sec.] 522(c)(2)(B), any exempt portion of the sale proceeds would be liable for the entirety of the IRS lien, not solely the non-penalty portion. Nevertheless, only if the Trustee succeeds in the Avoidance Action will any of the sale proceeds become exempt property. Accordingly, the IRS is not currently entitled to any distribution from the Trustee," the Judge said. A copy of the Court's July 9, 2014 Memorandum of Decision is available at http://is.gd/fhDUNGfrom Leagle.com. Kathryn Keneally, Esq., and Edward J. Murphy, Esq., of the U.S. Department of Justice, Washington, D.C. argues for the IRS. The Chapter 7 Trustee is represented by: Kate P. Foley, Esq. MIRICK, O'CONNELL, DEMALLIE, & LOUGEE, LLP 100 Front Street Worcester, MA 01608-1477 Tel: 508-860-1463 E-mail: kfoley@mirickoconnell.com The Hannons are represented by: Herbert Weinberg, Esq. ROSENBERG & WEINBERG 805 Turnpike St North Andover, MA 01845 Tel: (978) 683-2479 Fax: (978) 208-2501 E-mail: hweinberg@jrhwlaw.com PHI GROUP: Amends Fiscal 2012 Annual Report ------------------------------------------- PHI Group, Inc., filed with the U.S. Securities and Exchange Commission an amended annual report for the year ended June 30, 2012. The Amended Report disclosed $604,676 in total assets, $10.63 million in total liabilities and a $10.02 million total stockholders' deficit as of June 30, 2012. The Company previously reported $1.15 million in total assets, $10.63 million in total liabilities, all current, and a $9.47 million total stockholders' deficit. No changes were made to the Company's combined consolidated statements of operations. A full-text copy of the Form 10-K/A is available for free at: http://is.gd/e9MD3t About PHI Group Huntington Beach, Cal.-based PHI Group, Inc., through its wholly owned and majority-owned subsidiaries, is engaged in a number of business activities, the scope of which includes consulting and merger and acquisition advisory services, real estate and hospitality development, mining, natural resources, energy, and investing in special situations. The Company invests in various business opportunities within its chosen scope of business, provides financial consultancy and M&A advisory services to U.S. and foreign companies, and acquires selective target companies under special situations to create additional long-term value for its shareholders. PHI Group reported a net loss of $5.15 million on $570,000 of consulting and advisory fee income for the year ended June 30, 2012, as compared with a net loss of $1.17 million on $409,317 of consulting and advisory fee income for the year ended June 30, 2011. Dave Banerjee, CPA An Accountancy Corp., in Woodland Hills, California, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2012. The independent auditor noted that the Company has accumulated deficit of $35,814,955 and a negative cash flow from operations amounting to $1,367,705 for the year ended June 30, 2012. These factors raise substantial doubt about the Company's ability to continue as a going concern. PINNACLE HOLDCO: S&P Retains 'B' CCR Following $40MM Debt Add-On ---------------------------------------------------------------- Standard & Poor's Ratings Services said its ratings and outlook on Luxembourg-based computer services provider Pinnacle Holdco S.ar.l. remain unchanged upon the re-pricing of its first- and second-lien term loans to lower its interest costs and its issuance of a $40 million add-on to the first-lien debt. It intends to use the proceeds of the add-on to repay an equal amount of the second-lien debt. The tenor of both facilities remains unchanged. The transaction is leverage neutral. The 'B' corporate credit rating and all issue-level ratings remain the same. S&P's ratings on Pinnacle reflect the company's weak business risk profile and highly leveraged financial risk profile. The company, a provider of software solutions to the worldwide oil and gas exploration and production industry, has a significant market position in a relatively small market and competes with several major and long-established players with greater financial and product resources. It is helped by longstanding relationships with many major oil companies and a strong recurring revenue base with high renewal rates. The company's highly leveraged financial profile reflects debt to EBITDA leverage of close to 6x with no expected material improvement over the intermediate term. RATINGS LIST Pinnacle Holdco. S.ar.l. Corporate Credit Rating B/Stable/-- Senior Secured $345 mil.* first-lien term loan B+ Recovery Rating 2 $40 mil. revolver B+ Recovery Rating 2 $135 mil. second-lien bank loan CCC+ Recovery Rating 6 *Reflects amount after add-on POWER BALANCE: Confirmed Plan to Resolve Class Action Claims ------------------------------------------------------------ District Judge Edward M. Chen dismissed, without prejudice, all claims for relief asserted by the Plaintiff against the Defendant in the class action captioned as, C.F.C., minor, by and through CHRISTINE F., his parent and guardian, on behalf of himself and all others similarly situated, Plaintiff, v. POWER BALANCE LLC; a Delaware Limited Liability Company, Defendants, Case No. 3:11-CV- 00487-EMC (N.D. Cal.). Each party shall bear its own costs and fees. The Plaintiff sought dismissal of the claims. The court in Power Balance's bankruptcy case has confirmed Power Balance's Third Amended Chapter 11 Liquidating Plan. The Plaintiff's claims will be resolved by the Third Amended Chapter 11 Liquidating Plan. Plaintiff has contacted Power Balance's bankruptcy attorneys and requested that they sign a Stipulation for Voluntary Dismissal pursuant to F.R.C.P. 41(a)(1)(A)(ii). However, the Plaintiff has not heard back from Power Balance's attorneys for several months and therefore requests an Order from the Court. A copy of the Court's July 8, 2014 Order is available at http://is.gd/jRpEo4from Leagle.com. Christopher M. Burke, Esq. -- cburke@scott-scott.com -- Scott + Scott LLP, San Diego, CA, represents Plaintiff, C.F.C., a minor, by and through Christine F., his parent and guardian. Power Balance, LLC filed a voluntary Chapter 11 petition (Bankr. C.D. Cal. Case No. 11-25982) on November 18, 2011. PRECISION OPTICS: Richard Forkey Quits as Director ------------------------------------------------- Mr. Richard E. Forkey resigned from Precision Optics Corporation Inc.'s Board of Directors on July 9, 2014. Mr. Forkey will continue to stay involved with the Company as the founder and chairman emeritus. Mr. Forkey founded the Company in 1982 and spent the next 30 years turning his vision into a reality. During this time he served in many positions including clerk, treasurer, CEO, director, and chairman of the Board. He was the visionary behind the Company and has been instrumental in the development of the Company's proprietary technologies, having invented or co-invented the technology behind over 50 patents and patent applications assigned to the Company. Under Mr. Forkey's leadership, Precision Optics developed innovative optical systems that fueled advances in many different fields - from the world's first sterilizable endocouplers developed in the early 1980s to the night vision optics used by the US military in the early 1990s to the world's first 3D endoscope used for robotic surgery in the late 1990s. More recently, Mr. Forkey's vision for smaller, less intrusive optical devices for use in medical diagnostics and surgical procedures, has resulted in optical systems and endoscopes as small as a couple hundred microns. "We are grateful to Mr. Forkey for his service and dedication to our Company. As he steps down from the Board, we are pleased that he will continue to share his vision and passion as the Founder and Chairman Emeritus," the Company stated. Appointment of New Directors On July 9, 2014, the Company's Board of Directors appointed Dr. Kenneth S. Schwartz, MD, and Peter H. Woodward as directors of the Company and Mr. Woodward as Chairman of the Board. Dr. Schwartz is currently the Medical Director at New York Radiology Alliance, a position he has held since October 2010, and the Director of the Radiology Residency Program at Brookhaven Memorial Hospital Medical Center. He was the founding and managing Partner of S and D Medical LLP, a 60 person radiology group providing radiology services to eleven hospitals and imaging centers in the New York metropolitan area, for over ten years until he sold the Practice in 2010. He has served on the Board of Directors at ARKS Radiology Management, Inc., since June 1999 and serves on the Board of Trustees at the Brookhaven Memorial Hospital Medical Center. Dr. Schwartz also served as the Adjunct Clinical Associate Professor in the Department of Medical Imaging at the New York Institute of Technology in the College of Osteopathic Medicine from July 2007 to July 2012. Dr. Schwartz earned a BS from Brooklyn College and a Medical Degree from Albert Einstein College of Medicine. He was a Diagnostic Radiology Resident at North Shore University Hospital in the Memorial Hospital-Sloan Kettering Cornell Cooperating Program. Mr. Woodward is the founder of MHW Capital Management, LLC, a position he has held since September 2005. MHW specializes in large equity investments in public companies implementing operating strategies to significantly improve their profitability. From 1996 to 2005, Mr. Woodward was the Managing Director for Regan Fund Management, LLC. He currently serves as the Chairman of the Board and member of the Audit Committee for Cartesian, Inc. and TSS, Inc. Mr. Woodward holds a BA in economics from Colgate University and a Masters of International Affairs with a concentration in international economics and finance from Columbia University. He is also a Chartered Financial Analyst. Both Dr. Schwartz and Mr. Woodward were appointed in connection with the sale and purchase agreement between the Company and accredited investors reported on the Company's Periodic Report on Form 8-K filed July 7, 2014. Pursuant to the Agreement, the Company is required to appoint two qualified individuals named by Hershey Strategic Capital LP to the Company's Board of Directors. Those individuals shall serve for three years or until resignation, whichever is earlier. Bylaws Amendment On July 9, 2014, the Company's Board of Directors approved an amendment to its Bylaws. The Bylaws now provide that the Board of Directors will consist of six directors, rather than five. Additionally, the Bylaws were revised to state that the Chairman of the Board is not required to be an officer of the Company. Massachusetts law provides for a staggered Board by default; however, the Board of Directors believed it would add clarity to revise the Bylaws to explicitly state that the Company has a staggered Board. About Precision Optics Headquartered in Gardner, Massachusetts, Precision Optics Corporation, Inc., has been a developer and manufacturer of advanced optical instruments since 1982. The Company designs and produces high-quality micro-optics, medical instruments and other advanced optical systems. The Company's medical instrumentation line includes laparoscopes, arthroscopes and endocouplers and a world-class product line of 3-D endoscopes for use in minimally invasive surgical procedures. Precision Optics reported a net loss of $1.78 million for the year ended June 30, 2013, as compared with net income of $960,972 for the year ended June 30, 2012. The Company's balance sheet at March 31, 2014, showed $1.89 million in total assets, $919,074 in total liabilities, all current, and $975,505 in total stockholders' equity. PRECISION OPTICS: Hershey Management Holds 18.9% Equity Stake ------------------------------------------------------------- In a Schedule 13D filed with the U.S. Securities and Exchange Commission, Hershey Management I, LLC, Hershey Strategic Capital, LP, and Hershey Strategic Capital GP, LLC, disclosed that as of July 2, 2014, they beneficially owned 1,166,667 shares of common stock of Precision Optics Corporation, Inc., representing 18.9 percent of the shares outstanding. A full-text copy of the regulatory filing is available for free at http://is.gd/E47Jb2 About Precision Optics Headquartered in Gardner, Massachusetts, Precision Optics Corporation, Inc., has been a developer and manufacturer of advanced optical instruments since 1982. The Company designs and produces high-quality micro-optics, medical instruments and other advanced optical systems. The Company's medical instrumentation line includes laparoscopes, arthroscopes and endocouplers and a world-class product line of 3-D endoscopes for use in minimally invasive surgical procedures. Precision Optics reported a net loss of $1.78 million for the year ended June 30, 2013, as compared with net income of $960,972 for the year ended June 30, 2012. The Company's balance sheet at March 31, 2014, showed $1.89 million in total assets, $919,074 in total liabilities, all current, and $975,505 in total stockholders' equity. PRETTY GIRL: Seeks to Use JP Morgan's Cash Collateral ----------------------------------------------------- Pretty Girl, Inc., seeks authority from the U.S. Bankruptcy Court for the Southern District of New York to use cash collateral in which JP Morgan Chase Bank, NA, has an interest and grant the Bank adequate protection on account of such use. On Jan. 28, 2011, the Debtor and the Bank entered into a loan agreement in which the Bank made available to the Debtor a revolving loan with a credit limit of $3 million and a variable interest rate of 2.490 percentage points over the LIBOR Rate. Effective April 17, 2014, the Bank converted $1 million of the Revolving Loan to a fixed line of credit. As of the Petition Date, a balance of approximately $2.75 million was due under the Loan Agreement. The Debtor requires the use of cash collateral in which the Bank has an interest to carry out its daily business operations as it has no alternative source of revenue to draw upon. The Debtor states in court papers that its ability to access its accounts receivable, purchase inventory, pay rent and office expenses, maintain business relationships with vendors, suppliers, and customers, pay payroll and other direct operating expenses, and otherwise finance operations is essential to the Debtor?s continued viability. Counsel for the Bank: Clifford A. Katz, Esq. PLATZER, SWERGOLD, LEVINE, GOLDBERG, KATZ & JASLOW, LLP 475 Park Avenue South New York, NY 10022 Tel: 212-593-3000 Email: ckatz@platzerlaw.com Pretty Girl, Inc., filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-11979) on July 2, 2014. The petition was signed by Albert Nigri as president. The Debtor disclosed total assets of $10.76 million and total liabilities of $12.27 million. Rosen & Associates, P.C., acts as the Debtor's counsel. PRETTY GIRL: Seeks Extension of Schedules Filing Date ----------------------------------------------------- Pretty Girl, Inc., asks the U.S. Bankruptcy Court for the Southern District of New York to extend the time in which it may file its schedules of assets and liabilities and statement of financial affairs through and including Aug. 15, 2014. The deadline currently is July 16. The Debtor states in court papers that it will be unable to complete its Schedules and Statement within the current deadline and it needs additional time to enhance the accuracy of the Schedules and Statements and avoid the necessity of substantial subsequent amendments. Pretty Girl, Inc., filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-11979) on July 2, 2014. The petition was signed by Albert Nigri as president. The Debtor disclosed total assets of $10.76 million and total liabilities of $12.27 million. Rosen & Associates, P.C., acts as the Debtor's counsel. QTS REALTY: Moody's Assigns B2 Corporate Family Rating ------------------------------------------------------ Moody's Investors Service assigned a B2 corporate family rating to QTS Realty Trust, Inc (NYSE: QTS) and a B2 senior unsecured rating to QualityTech, L.P.'s proposed bond issuance. The rating outlook is stable. This is the first time Moody's has assigned a rating to QTS. QTS will issue up to $250 million of senior unsecured notes with an eight year maturity. The notes will be guaranteed by most of the subsidiaries of the Operating Partnership with the exception of the subsidiaries that own the Richmond, VA, Dallas, TX and East Windsor, NJ facilities. Collectively, these assets represented less than 10% of annualized rental revenue as of March 2014, however could represent a much larger percentage going forward as both the Texas and New Jersey assets are new and currently non- income producing. The notes will be pari passu to other existing and future unsecured debt QualityTech, L.P. The proceeds of which will be used to pay down existing balances on the company's unsecured term loan and revolving credit facility. Ratings Rationale The B2 corporate family and senior unsecured ratings incorporate QTS' fully integrated platform that offers both wholesale (C1) and retail/colocation (C2) services to its customers, as well as cloud and managed services (C3). The company has improved its portfolio occupancy over the past two years to 93% at 1Q14 from 88% at 1Q12, mainly through organic growth while maintaining good tenant diversification. The ratings are further supported by the company's large, high-quality unencumbered asset pool and manageable near-term debt maturities. These strengths are counterbalanced by the REIT's small size and asset concentration. As of March 31, 2014 the company owned and operated 10 assets throughout the U.S., with the Atlanta, GA (Metro) asset representing 38% of annualized rental revenues and the Suwanee, GA asset representing 25%. Upcoming lease maturities are also of concern, as over 40% of the portfolio (as defined by 1Q14 annualized rental revenue) will roll through 2016. A large portion of these maturities are colocation contracts with shorter lead times for renewals (typically three to six months prior to expiration). Due to the shorter lease terms (up to three years) for QTS' C2 and C3 clients, which represent 59% of annualized rental revenues as of March 2014, these business segments have the potential to create cash flow volatility versus the traditional C1 product which has lease terms of five to ten years. QTS has a modest leverage profile with Debt + Preferred % Gross Assets at 43% and Net Debt/EBITDA at 5.1x as of 1Q14 however is expected to operate closer to 50% effective leverage and 6.0x Net Debt/EBITDA over the next two years. Secured debt levels are low at 8.2% of gross assets as of 1Q14. The company has a strong fixed charge coverage ratio of 5.4x at 1Q14, however following the unsecured debt issuance QTS is expected to operate in the mid-4x range going forward. The stable rating outlook reflects Moody's expectation that QTS will continue to capitalize on strong demand for outsourced server and storage device capacity from large enterprises. It also incorporates Moody's expectation that QTS will prudently grow and diversify geographically its portfolio of assets while maintaining adequate liquidity to cover near and medium term needs. QTS' rating is constrained as a result of its small scale in a growing and competitive landscape as well as the company's substantial asset concentrations and therefore a ratings upgrade is unlikely in the next 12-18 months. However, an upgrade could be considered if QTS substantially diversifies its asset base such that no single asset represents greater than 20% of annualized revenue as well as gains greater scale. To the extent asset concentration and scale concerns are effectively mitigated, upward ratings pressure could develop if QTS improves and sustains its EBITDA margin at 50% and maintains its fixed charge while keeping its Debt to EBITDA under 4.0x. QTS ratings could be downgraded if the REIT experiences higher than expected churn and customer defections, moves toward a more aggressive financial policy (including sizeable leveraged acquisitions, or reduced liquidity), or if industry oversupply results in competitive pricing pressures and deterioration in profitability. The rating could also experience a downward pressure should negative shifts in the supply/demand or competitive dynamics in the data center space resulting in strained liquidity and total net debt to EBITDA sustained above 6.0x. The following ratings were assigned with a stable outlook: QTS Realty Trust, Inc. -- corporate family rating at B2 QualityTech, L.P. -- senior unsecured rating at B2 The principal methodology used in this rating was Global Rating Methodology for REITs and Other Commercial Property Firms published in July 2010. QTS Realty Trust, Inc. [NYSE: QTS], headquartered in Overland Park, Kansas, USA, is an owner, developer and operator of multi- tenant data centers in the U.S. QTS has a fully integrated platform that offers both wholesale and retail/colocation services to its customers, as well as cloud and managed services. As of March 31, 2014 the company owned ten datacenters representing 3.8 million square feet of space throughout the U.S. As of March 31, 2014 the company reported total assets of approximately $877 million and shareholders' equity of approximately $395 million. QTS REALTY: S&P Assigns B+ CCR & Gives B+ Unsecured Debt Rating --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Overland Park, Kan.-based QTS Realty Trust Inc. The outlook is stable. S&P also assigned its 'B+' issue-level ratings and '3' recovery ratings to the company's unsecured debt (issued by QualityTech LP), including the proposed $250 million unsecured notes due 2022 (to be co-issued by QTS Finance Corp.), the existing $400 million unsecured revolving credit facility due 2017 (with a one-year maturity extension upon satisfaction of certain conditions), and the existing $225 million term loan due 2018. The '3' recovery rating on this debt indicates S&P's expectation for meaningful (50% to 70%) recovery for lenders in the event of a payment default. The company will use proceeds to refinance existing indebtedness and pay transaction fees. "The ratings on QTS reflect the favorable growth prospects for data center outsourcing by business and enterprise customers, the company's low revenue churn and good predictability provided by long-term contracts, and the opportunity to improve margins through increased scale from existing data centers," said Standard & Poor's credit analyst Michael Weinstein. Given the leasing stability provided by the company's wholesale customer base, S&P considers the company's business risk to be "satisfactory," a category higher than the majority of rated retail-only data center peers. The company's aggressive growth strategy and the long-term risks of overexpansion that could lead to pricing declines somewhat offset these positive business factors. The ratings also reflect S&P's expectation for substantial cash outflows to fund growth. Pro forma for the proposed debt financing, the company will have approximately $400 million in liquidity including cash and availability under existing credit facilities. S&P considers this liquidity necessary to fund growth capital expenditures and shareholder distributions through the end of 2015 to early 2016, when, under S&P's base-case scenario, it believes QTS will need to raise additional capital to fund growth initiatives. The rating outlook is stable, and reflects S&P's expectation that the company will have adequate liquidity to fund growth initiatives and to fund negative discretionary cash flow through at least the end of 2015, as it continues to invest in building out rentable capacity in existing data centers. S&P could lower the rating if operating performance weakens because of competitive pressure or overexpansion, causing pricing pressure or a decline in utilization that would likely result in lower EBITDA margins sustained below 40%. A downgrade could also occur if liquidity became a significant risk because the company was unwilling to scale back capital spending in conjunction with deteriorating operating trends coupled with adverse credit market conditions. While less likely given the company's ongoing discretionary cash flow deficits and high debt leverage, S&P could raise the rating if the company were to commit to a less aggressive financial policy, including leverage sustained below 5x, while generating positive free operating cash flow. An upgrade would also require S&P's confidence that growth prospects and pricing in the data center industry remain solid. QUALITY DISTRIBUTION: FMR LLC Reports 3.2% Equity Stake ------------------------------------------------------- FMR LLC, Edward C. Johnson 3d and Abigail P. Johnson disclosed in an amended Schedule 13D filed with the U.S. Securities and Exchange Commission that as of July 9, 2014, they beneficially owned 871,637 shares of common stock of Quality Distribution, Inc., representing 3.181 percent of the shares outstanding. A full-text copy of the regulatory filing is available for free at: http://is.gd/euPM6H About Quality Distribution Quality Distribution, LLC, and its parent holding company, Quality Distribution, Inc., are headquartered in Tampa, Florida. The company is a transporter of bulk liquid and dry bulk chemicals. The company's 2010 revenues are approximately $686 million. Apollo Management, L.P., owns roughly 30 percent of the common stock of Quality Distribution, Inc. Quality Distribution reported a net loss of $42.03 million on $929.81 million of total operating revenues for the year ended Dec. 31, 2013, as compared with net income of $50.07 million on $842.11 million of total operating revenues in 2012. As of March 31, 2014, the Company had $443.15 million in total assets, $494.39 million in total liabilities and a $51.24 million total shareholders' deficit. Bankruptcy Warning The Company had consolidated indebtedness and capital lease obligations, including current maturities, of $383.3 million as of Dec. 31, 2013. The Company must make regular payments under the ABL Facility, including the $17.5 million senior secured term loan facility that was fully funded on July 15, 2013, and the Company's capital leases and semi-annual interest payments under its 2018 Notes. "The ABL Facility matures August 2016. Obligations under the Term Loan mature on June 14, 2016 or the earlier date on which the ABL Facility terminates. The maturity date of the ABL Facility, including the Term Loan, may be accelerated if we default on our obligations. If the maturity of the ABL Facility and/or such other debt is accelerated, we may not have sufficient cash on hand to repay the ABL Facility and/or such other debt or be able to refinance the ABL Facility and/or such other debt on acceptable terms, or at all. The failure to repay or refinance the ABL Facility and/or such other debt at maturity would have a material adverse effect on our business and financial condition, would cause substantial liquidity problems and may result in the bankruptcy of us and/or our subsidiaries. Any actual or potential bankruptcy or liquidity crisis may materially harm our relationships with our customers, suppliers and independent affiliates," the Company said in the Annual Report for the year ended Dec. 31, 2013. * * * As reported in the TCR on June 28, 2013, Moody's Investors Service upgraded Quality Distribution, LLC's Corporate Family Rating to B2 from B3 and Probability of Default Rating to B2-PD from B3-PD. The upgrade of Quality's CFR to B2 was largely driven by the expectation that credit metrics will improve over the next twelve to eighteen months, through a combination of EBITDA growth and debt paydowns, to levels consistent with the B2 rating level. The company is in the process of integrating the bolt-on acquisitions made in its Energy Logistics business sector since 2011. RADIOSHACK CORP: BlackRock's Equity Stake Down to 2.3% ------------------------------------------------------ BlackRock, Inc., reported with the U.S. Securities and Exchange Commission that as of June 30, 2014, it beneficially owned 2,331,377 shares of common stock of Radioshack Corp. representing 2.3 percent of the shares outstanding. BlackRock previously held 6,245,829 common shares at Dec. 31, 2013. A full-text copy of the regulatory filing is available at http://is.gd/lEr4GW About Radioshack Corporation RadioShack (NYSE: RSH) -- -- http://www.radioshackcorporation.com -- is a national retailer of innovative mobile technology products and services, as well as products related to personal and home technology and power supply needs. RadioShack's retail network includes more than 4,300 company-operated stores in the United States, 270 company-operated stores in Mexico, and approximately 1,000 dealer and other outlets worldwide. Radioshack disclosed a net loss of $139.4 million in 2012, as compared with net income of $72.2 million in 2011. As of May 3, 2014, Radioshack had $1.32 billion in total assets, $1.25 billion in total liabilities and $72.6 million in total stockholders' equity. * * * As reported by the TCR on June 18, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating on the Fort Worth, Texas-based RadioShack Corp. to 'CCC' from 'CCC+'. "The downgrade reflects the company's very weak operating trends, which have led to significant liquidity usage. Even if performance trends moderate, we expect the company to be using cash over the near term," said credit analyst Charles Pinson-Rose. In the Dec. 30, 2013, edition of the TCR, Fitch Ratings has affirmed its 'CCC' Long-term Issuer Default Rating (IDR) on RadioShack Corporation. The IDR reflects the significant decline in RadioShack's profitability and cash flow, which has become progressively more pronounced over the past two years. The TCR reported on March 13, 2014, that Moody's Investors Service downgraded RadioShack Corporation's corporate family rating to Caa2 from Caa1. "The continuing negative trend in RadioShack's sales and margins has resulted in a precipitous drop in profitability causing continued deterioration in credit metrics and liquidity," Mickey Chadha, Senior Analyst at Moody's said. Troubled Company Reporter, citing The Wall Street Journal, reported on March 5, 2014, that RadioShack plans to cut back its store count, after a sharp drop in sales over the holidays left it with a $400 million loss in 2013. The electronics retailer said it could close as many as 1,100 U.S. stores -- one out of every four that it operates itself -- underscoring the difficulty it has had adapting to a fast changing consumer landscape. RADNOR HOLDINGS: Tennenbaum Wins Protective Order v. Discovery -------------------------------------------------------------- R. Radcliffe Hastings filed an interpleader action pursuant to 28 U.S.C. Sec. 1335 to determine the disposition of funds belonging to defendant Michael T. Kennedy -- former CEO and majority shareholder of Radnor Holdings Corporation -- and purportedly owed to Kennedy's creditors who are the remaining defendants in the Hastings action. In a July 8, 2014 Memorandum available at http://is.gd/L908AUfrom Leagle.com, District Judge Harvey Bartle, III, granted the motion of defendant Tennenbaum Capital Partners LLC, one of the alleged creditors, for a protective order against certain discovery sought by Kennedy. In the same ruling, Judge Bartle denied the motion of defendant Kennedy to compel that discovery of Tennenbaum. Kennedy has propounded interrogatories, requests for production, and deposition notices upon Tennenbaum and certain non-parties seeking evidence of fraud which Kennedy maintains would invalidate Tennenbaum's judgment against his assets. Tennenbaum seeks a protective order to prevent Kennedy from obtaining such discovery on the ground that it is irrelevant to the action. According to the complaint, Hastings controls the books and records of five related entities: Maverick Partners, LP ("MPLP"); Bobcat Partners, LP; Maverick Partners, Inc. ("MPI"); Radnor Investment Advisors, Inc.; and Radnor Investment Advisors, LP ("RIALP"). The Hastings-Controlled Entities are financially intertwined such that defendant Kennedy, through his ownership of a limited partnership interest in RIALP and his ownership of capital stock of MPI, has a financial interest in all five companies. As a result of the recent sale of assets owned by MPLP, Kennedy is due certain moneys which Hastings is obligated to disburse. The remaining defendants in the action are Deborah Kennedy, Kennedy's former wife; Tennenbaum; Penn Liberty Bank; and the Internal Revenue Service. These four defendants purport to be creditors of defendant Kennedy and stake a claim to the moneys owed to Kennedy by the Hastings-Controlled Entities. Kennedy does not contest that certain of his creditors are entitled to the funds owed to him by the Hastings-Controlled Entities. However, Kennedy asserts that Tennenbaum does not have a legitimate judgment against his assets and that the IRS lien is entitled to first priority. Tennenbaum's lien results from a $10 million guaranty made by Kennedy of a loan made by Tennenbaum to Radnor Holdings. Tennenbaum has obtained a judgment against Kennedy for this amount. Pursuant to a Credit Agreement dated December 1, 2005, Tennenbaum, as agent for several lenders, loaned Radnor $95 million. On or about April 4, 2006, Tennenbaum made an additional loan to Radnor in the principal amount of $23.5 million, for a total of $118.5 million. In connection with the second loan, Kennedy executed a Guaranty and Negative Pledge Agreement, pursuant to which he personally guaranteed repayment of not more than $10 million of the principal amount of the second loan. Following the issuance of the loans, Radnor retained Skadden Arps, Slate, Meagher & Flom LLP as counsel. Radnor defaulted on payment of both Tennenbaum loans, and on August 21, 2006, filed for Chapter 11 bankruptcy protection in the Bankruptcy Court for the District of Delaware. In the course of the Chapter 11 proceedings, the Bankruptcy Court determined that Tennenbaum had an allowed secured claim of approximately $128.8 million and that the collateral securing the claim, consisting of substantially all of Radnor's assets, was valued at more than $132 million. The Bankruptcy Court authorized Tennenbaum to credit bid "any or all" of the claim "at any sale of property of [Radnor] that is subject to a lien that secures such Allowed Claim, and [to] offset any or all of such amounts against the purchase price of such property." Tennenbaum formed TR Acquisitions Co., LLC, an affiliate, to be the entity that would bid for and acquire the Radnor assets. On September 22, 2006, the Bankruptcy Court ruled that the total consideration bid by TRAC was "the highest and best offer received by Debtors" and approved the sale of Radnor's assets to TRAC under an Amended and Restated Asset Purchase Agreement. The "credit bid amount" offered as part of the aggregate consideration for the assets included the $95 million, which was the principal amount of the first loan, plus interest. The APA made no reference to the second loan, a part of which was personally guaranteed by Kennedy. In 2009, Tennenbaum brought a breach of contract action against Kennedy in the United States District Court for the Southern District of New York. Tennenbaum alleged that Kennedy failed to pay it $10 million owed under the Guaranty Agreement. Kennedy countered that the second Radnor loan was satisfied by the credit bid approved by the Bankruptcy Court. The District Court granted summary judgment in favor of Tennenbaum. It determined that the second Radnor loan had not been satisfied by the credit bid approved by the Bankruptcy Court and that Kennedy personally owed $10 million to Tennenbaum plus interest and attorney's fees. The United States Court of Appeals for the Second Circuit affirmed the District Court on April 20, 2010. It upheld the $10 million judgment against Kennedy. The Court ruled that the credit bid related to the first loan had been "substantively and procedurally fair" and that summary judgment in Tennenbaum's favor was proper. In November, 2009, Tennenbaum registered its judgment against Kennedy in the U.S. District Court for the Eastern District of Pennsylvania, and served writs of execution and garnishment interrogatories upon several entities, including Chartwell GP, Inc., and the Hastings-controlled entities. Chartwell acknowledged that Kennedy owned 100 shares of its stock, constituting a 9.09% ownership interest in the company. In March, 2010, the E.D. Pa. court granted a preliminary injunction to Tennenbaum, charging Kennedy's ownership interest in RIALP and Bobcat, two of the Hastings-Controlled entities, with the payment of any unsatisfied portion of the Tennenbaum judgment. Tennenbaum later sought the garnishment of any moneys payable to Kennedy by Chartwell, and in March, 2012, despite Kennedy's allegations of impropriety related to the Radnor bankruptcy, the E.D. Pa. court granted a second preliminary injunction in Tennenbaum's favor charging Kennedy's interest in Chartwell with the payment of any unsatisfied portion of the Tennenbaum judgment. In March 2012, the Delaware Bankruptcy Court held a hearing on the confirmation of the liquidation plan in the Radnor bankruptcy. The court granted Kennedy an extension in order to hire "special counsel" to investigate certain matters that Kennedy claimed to have uncovered. Kennedy did not file an objection by the end of the extension period, and on September 10, 2012 the Bankruptcy Court entered an order confirming the liquidation plan. On December 26, 2012, Kennedy filed an objection to the Fee Application of Skadden Arps on the ground that Skadden Arps, Radnor's counsel, had breached its ethical duties to Radnor because several of its attorneys had a financial interest in Tennenbaum. On May 1 and 2, 2013, the Bankruptcy Court held an evidentiary hearing on Kennedy's objection. Giving no weight to Kennedy's testimony, the court found that Skadden Arps did not engage in any malpractice, breach of fiduciary duty, fraud, conspiracy, perjury, obstruction of justice or other willful misconduct in connection with the Radnor bankruptcy. In sum, four different tribunals have made consistent findings over the course of six years affirming the sum owed by Kennedy to Tennenbaum, notwithstanding Kennedy's various objections regarding the validity of the judgment against him. The case is, R. RADCLIFFE HASTINGS v. MICHAEL T. KENNEDY, et al., Civil Action No. 14-1333 (E.D. Pa.). About Radnor Holdings Based in Radnor, Pennsylvania, Radnor Holdings Corporation -- http://www.radnorholdings.com/-- manufactured and distributed a broad line of disposable food service products in the United States, and specialty chemicals worldwide. The Debtor and its affiliates filed for chapter 11 protection on August 21, 2006 (Bankr. D. Del. Lead Case No. 06-10894). Gregg M. Galardi, Esq., and Sarah E. Pierce, Esq., at Skadden, Arps, Slate, Meagher &Flom, LLP, in Wilmington, Del.; and Timothy R. Pohl, Esq., Patrick J. Nash, Jr., Esq., and Rena M. Samole, Esq., at Skadden, Arps, Slate, Meagher &Flom, LLP, in Chicago, Ill., serve as the Debtors' bankruptcy counsel. When the Debtors filed for protection from their creditors, they disclosed total assets of $361,454,000 and total debts of $325,300,000. RANCHER ENERGY: B F Borgers CPA PC Raises Going Concern Doubt ------------------------------------------------------------- Rancher Energy Corp. filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K for the fiscal year ended March 31, 2014. The Company has reported an accumulated deficit of approximately $91.5 million. At March 31, 2014, the Company has current assets of $380,866, including cash and cash equivalents of $344,098 and current liabilities of $49,583 but has no operations. To the extent the Company's current assets are not sufficient to fund the Company's capital and current growth requirements the Company will attempt to raise needed funds through debt or equity. At the present time, the Company cannot provide assurance that it will be able to raise necessary funds. These conditions raise substantial doubt about the Company's ability to do so. The Company reported a net loss of $764,139 on $nil of revenue for the fiscal year ended March 31, 2014, compared with a net loss of $214,631 on $nil of revenue in 2013. The Company's balance sheet at Dec. 31, 2013, showed $1.73 million in total assets, $49,583 in total liabilities, and stockholders' equity of $1.68 million. A copy of the Form 10-K is available at: http://is.gd/kJCCkZ About Rancher Energy Denver, Colorado-based Rancher Energy Corp. (OTC BB: RNCHQ) -- http://www.rancherenergy.com/-- is an independent energy company that explores for and develops produces, and markets oil and gas in North America. Through March 2011, the Company operated four oil fields in the Powder River Basin, Wyoming. Effective March 1, 2011, the Company sold all of its oil and gas properties, which has allowed it to eliminate the majority of its debt and also provide financial resources during its continuing reorganization. The Company was formerly known as Metalex Resources, Inc., and changed its name to Rancher Energy Corp. in 2006. Rancher Energy Corp. was incorporated in the State of Nevada on Feb. 4, 2004. Rancher Energy filed for Chapter 11 bankruptcy protection (Bankr. D. Colo. Case No. 09-32943) on Oct. 28, 2009. In its petition, the Company estimated assets and debts of between $10 million and $50 million each. The Debtor is represented by lawyers at Onsager, Staelin & Guyerson, LLC. The Company sold substantially all of its assets effective March 1, 2011, to Linc Energy Petroleum (Wyoming), Inc. in exchange for cash of $20 million plus other potential future consideration up to $825,000, and subject to other adjustments. The deal was approved Feb. 24, 2011. As reported in the Troubled Company Reporter on March 25, 2011, the Company delivered to the Bankruptcy Court a first amended Chapter 11 plan of reorganization, and first amended disclosure statement explaining that plan. The Bankruptcy Court approved the Second Amended Plan of Reorganization and accompanying Disclosure Statement of Rancher Energy Corporation on Sept. 10, 2012. The Plan became effective on Oct. 10, 2012. Rancher Energy reported of $148,299 on $0 of revenue for the three months ended June 30, 2013, as compared with a net loss of $79,217 on $0 of revenue for the same period during the prior year. The report of Rancher Energy's independent registered public accounting firm on the financial statements for the years ended March 31, 2013, and 2012, includes an explanatory paragraph relating to the uncertainty of the Company's ability to continue as a going concern. The Company has incurred a cumulative net loss of approximately $91 million for the period from incorporation, Feb. 4, 2004, to Sept. 30, 2013. RATCLIFFE HOLDINGS: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Ratcliffe Holdings, LLC 21421 Snag Island Drive Lake Tapps, WA 98391 Case No.: 14-43801 Chapter 11 Petition Date: July 10, 2014 Debtor's Counsel: Shawn B. Rediger, Esq. WILLIAMS KASTNER & GIBBS PLLC 601 Union St Ste 4100 PO Box 21926 Seattle, WA 98111 Tel: 206-628-6600 Email: srediger@wkg.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Joyce M. Ratcliffe, managing member. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. RIVER CITY RESORT: May File Cross-Claim in Suit v. Wingfield ------------------------------------------------------------ Bankruptcy Judge Shelley D. Rucker in Tennessee allowed River City Resort, LLC, to amend its Answer and Counterclaim in an adversary proceeding to assert in a cross-claim a fraudulent transfer claim against defendant S. Jackson Wingfield, III. RCR is given 14 days after entry of the Court's order to file the amendment and cross- claim. Wingfield objected to the amendment on the basis that (1) the debtor has waited too long to be allowed to amend its pleadings and (2) the amendment is futile because the statute of limitations has run. The case is, RIVER CITY RESORT, INC., and B. ALLEN CASEY, JR., Plaintiffs, v. PAUL FRANKENBERG, III, and S. JACKSON WINGFIELD, III, Defendants, Adv. Proc. No. 14-01028 (Bankr. E.D. Tenn.). A copy of the Court's July 9, 2014 Memorandum is available at http://is.gd/CCUX05from Leagle.com. About River City Resort River City Resort, Inc., which formerly does business as Showboat Suites, Inc., filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case No. 14-10745) on Feb. 24, 2014. River City Resort owns a portion of a tract of property on the Tennessee River where a rundown barge is moored across from the Tennessee Aquarium. Judge Shelley D. Rucker presides over the case. David J. Fulton, Esq., at Scarborough, Fulton & Glass, represents the Chattanooga, Tenn.-based Company. In its petition, River City estimated $1 million to $10 million in both assets and debts. The petition was signed by Allen Casey, president. Mr. Casey on Feb. 26, 2014, filed a Chapter 7 bankruptcy petition in U.S. Bankruptcy Court in Chattanooga, Tenn., estimating assets of $50,000 or less, and liabilities between $1 million and $10 million. RUE21 INC: Bank Debt Trades at 13.4% Off ---------------------------------------- Participations in a syndicated loan under which Rue21 Inc. is a borrower traded in the secondary market at 86.60 cents-on-the- dollar during the week ended Friday, July 11, 2014, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents an increase of 0.10 percentage points from the previous week, The Journal relates. Rue21 Inc. pays 475 basis points above LIBOR to borrow under the facility. The bank loan matures on Sept. 30, 2020 and carries Moody's B3 rating and Standard & Poor's B- rating. The loan is one of the biggest gainers and losers among 205 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. SIFCO SA: Hearing on Brazilian Proceeding Adjourned to Sept. 23 --------------------------------------------------------------- The Bankruptcy Court adjourned to Sept. 23, 2014, at 9:45 a.m., the hearing to consider the request of Rubens Leite, in his capacity as the foreign representative for SIFCO S.A., for recognition of the Brazilian Proceeding as a foreign main proceeding. The U.S. proceedings are before the U.S. Bankruptcy Court for the Southern District of New York. Objections, if any, are due Sept. 16 at 5:00 p.m. SIFCO's reorganization proceedings under Brazilian insolvency law are pending before the Vara de Falencias e Recuperacoes Judiciais da Comarca de Sao Paulo/SP. As reported in the Troubled Company Reporter on May 30, 2014, the Court adjourned to Aug. 6, the hearing on the petition for recognition of the foreign main proceeding filed on behalf of SIFCO S.A. As reported in the TCR on April 29, 2014, axle-supplier SIFCO SA commenced restructuring proceedings in Brazil and has asked the bankruptcy court in the U.S. to recognize the Brazilian proceedings. Rubens Leite, the foreign representative, explained in documents that over the course of the past few years, SIFCO, like many other entities in a variety of industries throughout the world, has faced significant challenges. The worldwide recession that has taken hold since 2007 has created an environment of economic distress for companies and individuals alike, and that environment has impacted SIFCO's operations and sales. In addition, SIFCO's operations were impacted over 2012-13 by an unexpected slowdown of the truck market where sales volume fell by 36%. Trucks constitute SIFCO's main market, accounting for 72% of sales in 2011. As a result, SIFCO faces financial and operational hurdles that made it prudent for SIFCO to seek relief under the Brazilian Restructuring Law in order to preserve its value as a going concern and maximize the value of its assets for the benefit of all creditors. SIFCO shareholders authorized the commencement of the Brazilian Proceeding, and on April 18, 2014, authorized the commencement of a Chapter 15 proceeding in the U.S. SIFCO also empowered Rubens Leite to act as SIFCO's foreign representative for the U.S. proceeding. SIFCO initiated the Brazilian Proceeding pursuant to the provisions of Brazilian Restructuring Law, the recuperacao judicial, Federal Law No. 11,101 of February 9, 2005, by submitting a voluntary petition to the Brazilian Court. The restructuring contemplated to be undertaken in the Brazilian Proceeding will achieve a significant restructuring of SIFCO's business, according to Mr. Leite. "SIFCO anticipates that it will emerge from this restructuring process a stronger, more competitive company, and believes that the benefits to be gained from the restructuring process will enable SIFCO to remain a premier supplier of forged and precision machine parts for the global truck and bus manufacturing industry." Pending development and approval of a restructuring plan by the Brazilian Court, SIFCO requires the protection afforded to foreign debtors pursuant to Chapter 15 of the Bankruptcy Code in order to protect its valuable assets in the United States. For example, SIFCO has interests in a certain collateral account maintained by The Bank of New York Mellon in New York, as well as rights under an exclusive supply contract with Westport Axle Corp. covering 100% of Westport's requirements for certain automotive products sold in the United States. Pending the Court's consideration of the Recognition motion, Mr. Leite has filed an application with the U.S. Court for: a. immediate entry of an order to show cause with a temporary restraining order; b. after notice and a hearing, a preliminary injunction order that will remain in place pending the Court's consideration of the request for entry of an order recognizing the Brazilian Proceeding as a "foreign main proceeding"; and c. scheduling of a hearing on the application and request for a preliminary injunction at the earliest possible time, but in no event prior to the date that the Court sets for the expiration of the temporary restraining order that is requested by this application. The foreign representative is represented by: William C. Heuer, Esq. James J. Vincequerra, Esq. DUANE MORRIS LLP 1540 Broadway New York, NY 10036-4086 Tel: (212) 692-1000 Fax: (212) 692-1020 E-mails: wheuer@duanemorris.com jvincequerra@duanemorris.com About SIFCO SA Brazilian company SIFCO SA began its operations in 1958, and today it believes that it is the sole producer and supplier of front axles and I-beams for trucks and buses in South America. SIFCO's management and engineers are located outside S?o Paulo, Brazil in the City of Jundiai, Brazil, where it also maintains manufacturing and foundry facilities. In the 1960s, SIFCO was dedicated to supplying the then-recently created domestic Brazilian automotive industry. Eventually, SIFCO began producing high technology forging components in compliance with the most comprehensive requirements of several automotive industry segments, such as tractors and agricultural machines, among others. SIFCO commenced a bankruptcy restructuring in Brazil on April 22, 2014. A day later, on April 23, it filed a Chapter 15 petition in U.S. Bankruptcy Court (Bankr. S.D.N.Y. Case No. 14-bk-11179) in Manhattan, New York. SIFCO distributes products in the U.S. through Westport Axle Corp., which was a subsidiary until it was sold in late 2013. The petition shows assets of less than $500 million and debt exceeding $500 million. SIFCO has $75 million outstanding on senior secured notes with Bank of New York Mellon Corp. as agent. SIFCO is owned by Sifco Metals Participacoes S.A. which is a privately owned company. SIFCO is represented in the U.S. proceedings by Duane Morris LLP, in New York. SOLAR POWER: Unit Inks Cooperation Agreement with Fenyi County -------------------------------------------------------------- Solar Power, Inc.'s wholly-owned subsidiary, Xinyu Xinwei New Energy Co., Ltd., signed an agreement with the People's Government of Fenyi County, Jiangxi Province, People's Republic of China, to build and develop a 50MW photovoltaic (PV) project in Yangqiao, Fenyi County, on June 25, 2014. Under the terms of the agreement, the government of Fenyi County will provide certain guarantees and support to Xinwei for the project's construction and development stages, in addition to offering certain incentives and other services for the project's later phases leading up to grid connection. The government of Fenyi County also intends participate actively in coordinating all relevant local and provincial departments to facilitate and expedite construction of the project. Xinwei will promote the application of PV products, and through the project intends to improve local energy-savings and improve the local economy through the hiring of local workers. A full-text copy of the Cooperation Agreement of 50 MWp Photovoltaic Grid-connected Power Generation Project in Yangqiao of Fenyi County is available for free at http://is.gd/wjk48y About Solar Power Roseville, Cal.-based Solar Power, Inc., is a global solar energy facility ("SEF") developer offering its own brand of high- quality, low-cost distributed generation and utility-scale SEF development services. Primarily, the Company works directly with and for developers around the world who hold large portfolios of SEF projects for whom it serves as an engineering, procurement and construction contractor. The Company also performs as an independent, turnkey SEF developer for one-off distributed generation and utility-scale SEFs. Solar Power reported a net loss of $32.24 million in 2013 following a net loss of $25.42 million in 2012. As of Dec. 31, 2013, the Company had $70.96 million in total assets, $73.83 million in total liabilities and a $2.86 million total stockholders' deficit. Crowe Horwath LLP, in San Francisco, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred a current year net loss of $32.2 million, has an accumulated deficit of $56.1 million, has experienced a significant reduction in working capital, has past due related party accounts payable and a debt facility under which a bank has declared amounts immediately due and payable. Additionally, the Company's parent company LDK Solar Co., Ltd has experienced significant financial difficulties including the filing of a winding up petition on Feb. 24, 2014. These matters raise substantial doubt about the Company's ability to continue as a going concern. SOUTHCROSS ENERGY: Moody's Rates $450MM Senior Secured Loan 'B1' ---------------------------------------------------------------- Moody's Investors Service assigned a first time B1 rating to Southcross Energy Partners, LP's proposed $450 million senior secured term loan. Moody's also assigned a B1 Corporate Family Rating (CFR), a B1-PD Probability of Default Rating (PDR), and a SGL-3 Speculative Grade Liquidity Rating to Southcross. The outlook is stable. Term loan proceeds at Southcross will be used in combination with new equity to repay outstanding borrowings under the company's revolving credit facility and to fund a dropdown of midstream assets from its parent. In a contemporaneous action, Moody's assigned a first time B2 rating to Southcross Holdings Borrower LP's (Holdings) proposed $525 million senior secured second-lien term loan B. Moody's also assigned a B2 CFR, a B2-PD PDR, and a SGL-3 Speculative Grade Liquidity Rating to Holdings. The outlook is stable. Term loan proceeds at Holdings will be used in combination with cash proceeds from asset dropdowns and anticipated new Holdings equity to repay debt and preferred stock outstanding at the predecessor entities. On June 12, Southcross Energy LLC (not rated) and TexStar Midstream Services, LP (TexStar, not rated), a wholly-owned subsidiary of BlackBrush TexStar LP (BBTS, Caa1 stable), announced their intention to combine. The combination of the two companies newly forms Southcross Holdings LP. Simultaneously with the closure of the merger, Holdings will drop roughly one-third of TexStar's assets into Southcross in exchange for $180 million in cash and 14.633 million newly-issued payment-in-kind (PIK) Southcross common units which are valued in this transaction at approximately $270 million. Pro forma for the transaction and the pending conversion of the PIK units issued in conjunction with the first drop down, Holdings will retain a 2% general partner (GP) interest and a 56% limited partner (LP) interest in Southcross. In addition, Holdings will retain ownership of roughly two-thirds of TexStar's legacy assets, with these assets likely made available for future dropdowns to Southcross. Holdings will be owned approximately one-third each by financial sponsors EIG Global Energy Partners, Charlesbank Capital Partners LLC, and Tailwater Capital. "The combination of the Southcross and TexStar assets creates a meaningfully sized midstream presence in the Eagle Ford Shale," commented Michael Sabella, Moody's Analyst. "The pro forma cash flow stream will be predominately fee-based, while leverage metrics are expected to remain at levels consistent with similarly rated midstream peers. Moody's expectation is that future dropdowns will be funded with a significant equity component. Over time as the dropdowns are completed, Holdings' rating will become increasingly reliant on its equity interest in Southcross, but the initial rating considers the significant cash flow being generated by assets owned directly by Holdings." Ratings Assigned: Southcross Energy Partners, LP Corporate Family Rating assigned at B1 Probability of Default Rating assigned at B1-PD Senior Secured Bank Credit Facility assigned at B1 (LGD3-48%) Speculative Grade Liquidity Rating assigned at SGL-3 Outlook stable Southcross Holdings Borrower LP Corporate Family Rating assigned at B2 Probability of Default Rating assigned at B2-PD Senior Secured Second-Lien Bank Credit Facility assigned at B2 (LGD4-54%) Speculative Grade Liquidity Rating assigned at SGL-3 Outlook stable Rating Rationale Southcross's B1 CFR reflects the relatively limited size and scale of its operations as an owner and operator of natural gas gathering and processing (G&P) systems, which are heavily concentrated in the Eagle Ford. In addition, the company faces execution risk in its accelerated growth strategy, which involves the likelihood of further asset dropdowns from Holdings. Conservative financial policies remain a key support for the rating, and Moody's expects Southcross's leverage to fall below 4x in 2015. Additionally, pro forma for the dropdown of the TexStar assets, over 90% of Southcross's processing volumes are contracted on a fixed-fee or fixed-spread basis, largely mitigating commodity price risk from the cash flow stream. Southcross also benefits from significant minimum volume commitments from upstream contract counterparties in the Eagle Ford, generating a stable cash flow base. The B2 CFR assigned to Holdings reflects its structurally subordinated position to Southcross, in which Holdings owns a 56% LP stake as well as the 2% GP interest. While cash distributions received from Southcross are anticipated to grow over time, the one-notch rating differential between the parent and subsidiary recognizes Holdings' subordinate position with respect to those cash flows. The rating also considers the sizeable asset base retained by Holdings which, notwithstanding future dropdowns, will likely generate in excess of two-thirds of Holdings' 2015 cash flow. However, as asset dropdowns are completed, Holdings will become increasingly reliant on the subordinated cash flow stream from Southcross. The B2 rating also recognizes the execution risk associated with a sizeable growth capital spending program through 2015, and that Holdings will be used on an ongoing basis to develop and incubate future growth projects, thereby taking on the higher risk construction stage of asset development. The rating also reflects Moody's expectation that Holdings will raise around $150 million in equity concurrent with the closing of the transaction. The SGL-3 at Southcross reflects Moody's view of adequate liquidity through 2015. Its $450 million senior secured term loan and PIK equity proceeds will be used primarily to repay about $230 million anticipated to be outstanding on an existing credit facility at closing and to fund the $450 million asset dropdown from Holdings, with the remainder used to fund fees and expenses associated with the transaction with minimal cash to the balance sheet. Upon closure of the transaction, Southcross will have no outstandings under a new $120 million senior secured revolving credit facility. The funding of the majority of the investment in asset development, which Moody's expect will likely comprise much of Southcross's future growth, is being financed at Holdings, with only modest growth capital spending required at Southcross. The revolver requires leverage (debt/EBITDA) to be limited to 5.75x on or before December 31, 2014, stepping down to 5.5x on or before March 31, 2015, 5.25x on or before June 30, 2015, and 5x thereafter. EBITDA for the covenant includes Material Project Add- Backs for future EBITDA generation. Moody's expects Southcross to remain in compliance with its covenants. The revolver is secured by a first-lien on substantially all assets. Moody's views alternate sources of liquidity through potential asset sales to be limited. Holdings should have adequate liquidity through mid-2015, as evidenced by its Speculative Grade Liquidity Rating of SGL-3. The $525 million term loan B proceeds and $180 million in dropdown proceeds are expected to be complemented by equity proceeds of $150 million from newly issued class A units in Holdings. Proceeds will be used to repay a total of around $750 million in debt and preferred stock outstanding at the predecessor entities. Pro forma for the new term loan and class A equity, Holdings should have a cash balance of around $75 million and an undrawn $50 million revolving credit facility. The majority of the investment in asset development will be financed at Holdings, and Moody's believes between $125 and $150 million will be needed to fund growth projects at Holdings through 2015. Moody's anticipates that cash from operations, cash balances and revolver availability will be sufficient to fund the development of these projects. The facility has a springing leverage covenant should outstandings exceed 25% of the revolver commitment amount, and Moody's anticipate Holdings will remain in compliance with its covenants. The revolver is secured by a first-lien on substantially all assets of Holdings as well as the capital stock owned by Holdings. The company is required to use the first $100 million in asset sale proceeds to repay term loan borrowings and 100% of asset sale proceeds thereafter to the extent leverage remains above 3.5x. Moody's therefore regards alternate sources of liquidity to be limited. The outlook at Southcross is stable. Moody's expects that Southcross will likely absorb additional dropdowns from Holdings, and that an appropriate balance of debt and equity funding will be used to finance the dropdowns. If annual EBITDA at Southcross approaches $250 million with leverage remaining below 4x, Southcross could be upgraded. The rating could be downgraded if leverage remains above 5x, or should margins become meaningfully more exposed to commodity price risk. The outlook at Holdings is stable given Moody's expectation that any material asset sale or dropdown proceeds will be accompanied by a commensurate amount of debt reduction. As asset dropdowns are completed, Holdings will become increasingly reliant on Southcross distributions. Therefore, Moody's anticipates the rating gap widening from the current one notch to a likely two notch differential in the future. Therefore, an upgrade of Holdings is unlikely unless the Southcross rating is upgraded to Ba2. A downgrade of Holdings would be likely in the event of a downgrade at Southcross. The $450 million term loan and the $120 million revolving credit facility at Southcross rank pari passu in the capital structure, and the B1 rating on Southcross's senior secured bank credit facility reflects the first-lien interest in substantially all the assets of Southcross. The single class of debt results in the facility being rated at the B1 CFR under Moody's Loss Given Default Methodology. The B2 rating on Holdings' senior secured second-lien term loan B reflects the relatively small size of the first-lien $50 million credit facility in relation to Holdings' term loan, resulting in the term loan being rated at the B2 CFR under Moody's Loss Given Default Methodology. The principal methodology used in this rating was the Global Midstream Energy Rating 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. Southcross Energy Partners, LP is a midstream MLP headquartered in Dallas, Texas, whose general partner Southcross Holdings LP is also headquartered in Dallas, Texas. SOUTHCROSS ENERGY: S&P Assigns 'B' CCR & Rates $450MM Facility 'B' ------------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'B' corporate credit rating to Southcross Energy Partners L.P. "At the same time, we assigned a 'B' issue-level rating and a '3' recovery rating to the $450 million term loan facility due 2021 and $120 million senior secured revolving credit facility due 2019. We expect the partnership to use net proceeds of the term loan to partially fund the purchase of the Rich Gas System from its parent, Southcross Holdings L.P., and to pay down the balance of its existing revolving credit facility. The '3' recovery rating indicates that lenders can expect meaningful (50% to 70%) recovery of principal if a payment default occurs. The outlook is stable," S&P said. "Our ratings on Southcross reflect our assessment of its 'weak' business risk profile and 'aggressive' financial risk profile," said Standard & Poor's credit analyst Stephen Coscia. The "weak" business risk profile reflects the partnership's limited scale and geographic scope, which is only partially offset by its high percentage of fee-based cash flow. S&P's assessment of the "aggressive" financial risk profile primarily reflects its expectation that debt to EBITDA will be relatively high, in the mid-4x range before modestly decreasing to about 4x in 2015 and 2016. In addition, the master limited partnership structure poses credit constraints in that the partnership is highly motivated to pay out the vast majority in free cash flow (after maintenance capital spending) to unitholders each quarter. The stable outlook reflects S&P's expectation that Southcross will maintain adequate liquidity while successfully ramping up the business with the acquisition of the Rich Gas System, which would result in adjusted debt-to-EBITDA at about 4x. SOUTHCROSS HOLDINGS: S&P Assigns 'B-' Corporate Credit Rating ------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B-' corporate credit rating to Southcross Holdings Borrower L.P. At the same time, S&P assigned a 'B-' issue-level rating and a '3' recovery rating to the $525 million term loan B due 2021. S&P expects the partnership to use net proceeds to repay debt at BlackBrush TexStar L.P. and preferred equity at Southcross Energy LLC. The '3' recovery rating indicates that lenders can expect meaningful (50% to 70%) recovery of principal if a payment default occurs. The outlook is stable. "Our ratings on Southcross Holdings reflect our assessment of its 'vulnerable' business risk profile and 'aggressive' financial risk profile," said Standard & Poor's credit analyst Stephen Coscia. The "vulnerable" business risk profile reflects the partnership's dependency on residual cash flows from master limited partnership (MLP) Southcross Energy Partners L.P. (SXE), in addition to its limited scale and geographic scope, which is only partially offset by its high percentage of fee-based cash flow. S&P's assessment of the "aggressive" financial risk profile primarily reflects its expectation that debt to EBITDA will be high at about 5x in 2014 before decreasing to around 4x. The stable outlook reflects S&P's expectation that Southcross Holdings will maintain adequate liquidity while ramping up the business, resulting in adjusted debt-to-EBITDA declining to roughly 4x from roughly 5x in 2014. SRKO FAMILY: JSGE Loan Agreement Maturity Extended Until Oct. 15 ---------------------------------------------------------------- Judge Sidney B. Brooks of the U.S. Bankruptcy Court for the District of Colorado granted the motion for the second extension of the loan agreement among C. Randel Lewis, in his capacity as the Chapter 11 Trustee of the Jannie Richardson bankruptcy estate, The SRKO Family Limited Partnership, and JSGE, LLC, to Oct. 15, 2014. On Jan. 31, 2012, the Court approved the Loan Agreement, which was entered into to provide post-petition financing to SRKO. JSGE was authorized to loan up to $750,000 to the SRKO Estate. The Richardson Estate was authorized, but not obligated, to loan up to $1 million to the SRKO Estate. The original Loan Agreement terminated on Feb. 13, 2013, which was extended by agreement of the Parties to July 15, 2013. Under the Second Extension, the Parties have agreed that JSGE will advance $250,000 in two installments of $125,000 to SRKO under the Loan Agreement. JSGE will be authorized to make additional advances up to $500,000 under the Loan Agreement. The Richardson estate will be authorized to make additional advances up to the $1 million limit of the Loan Agreement. The Maturity Date of the Loan Agreement is extended through Oct. 15, 2014. A hearing on the Plan and Disclosure Statement filed in the Debtors' Chapter 11 cases will be held on Aug. 21, 2014, at 9:00 a.m. About The SRKO Family LP The SRKO Family Limited Partnership, dba Colorado Crossing, is based in Colorado Springs, Colorado. SRKO Family is the owner of the financially troubled Colorado Crossing project. The Company was run by Colorado Springs developer Jannie Richardson. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Colo. Case No. 10-13186) on Feb. 19, 2010. The Debtor disclosed $34,421,448 in assets and $80,619,854 in liabilities as of the Petition Date. Lee M. Kutner at Kutner Miller Brinen, P.C. represents the Debtor. On March 25, 2010, Jannie Richardson filed a Chapter 11 petition in the Court commencing the Richardson bankruptcy case. C. Randel Lewis was appointed as the Chapter 11 trustee in the Richardson case on Jan. 28, 2011. On March 11, 2011, the Bankruptcy Court entered an order approving a stipulation pursuant to which the Chapter 11 trustee in the affiliated Richardson Chapter 11 case was named as the manager of the Debtor's general partner. Craig A. Christensen, Esq., at Lindquist & Vennum LLP, represents C. Randel Lewis, the Chapter 11 trustee of the Jannie Richardson bankruptcy estate. STELLAR BIOTECHNOLOGIES: Posts $1.8MM Net Income in May 31 Qtr. --------------------------------------------------------------- Stellar Biotechnologies, Inc., reported net income and comprehensive income of $1.81 million on $102,581 of total revenues for the three months ended May 31, 2014, as compared with a net loss and comprehensive loss of $1.17 million on $73,214 of total revenues for the same period in 2013. For the nine months ended May 31, 2014, the Company reported a net loss and comprehensive loss of $3.80 million on $252,848 of total revenues as compared with a net loss and comprehensive loss of $5.58 million on $250,422 of total revenues for the same period last year. The Company's balance sheet at May 31, 2014, showed $15.50 million in total assets, $4.35 million in total liabilities and $11.15 million in total shareholders' equity. Cash and cash equivalents as of May 31, 2014, were $14.8 million, compared to $ 7.9 million at year-end Aug. 31, 2013. "This has been an important strategic year for Stellar and we are pleased to report positive momentum in key facets of our KLH business," said Frank Oakes, president and CEO of Stellar Biotechnologies. "Our corporate collaborations, where Stellar KLH is used as the critical carrier molecule in new therapeutic vaccines, are strong and poised for clinical advancement. And we are on track in the preclinical development of our own C. diff immunotherapy program. We are confident that these initiatives will enhance valuation for our shareholders as well as expand Stellar?s long-term commercial potential." A full-text copy of the press release is available for free at: http://is.gd/URI5f3 About Stellar Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.'s business is to commercially produce and market Keyhole Limpet Hemocyanin ("KLH") as well as to develop new technology related to culture and production of KLH and subunit KLH ("suKLH") formulations. The Company markets KLH and suKLH formulations to customers in the United States and Europe. KLH is used extensively as a carrier protein in the production of antibodies for research, biotechnology and therapeutic applications. Stellar Biotechnologies incurred a loss and comprehensive loss of $14.88 million on $545.46 million of revenues for the year ended Aug. 31, 2013, as compared with a loss and comprehensive loss of $5.19 million on $286.05 million of revenues for the year ended Aug. 31, 2012. STELLAR BIOTECHNOLOGIES: Swings to $1.8-Mil. Net Income in Q3 ------------------------------------------------------------- Stellar Biotechnologies, Inc., reported net income and comprehensive income of $1.81 million on $102,581 of revenues for the three months ended May 31, 2014, as compared with a net loss and comprehensive loss of $1.17 million on $73,214 of revenues for the same period last year. For the nine months ended May 31, 2014, the Company had a net loss and comprehensive loss of $3.80 million on $252,848 of revenues as compared with a net loss and comprehensive loss of $5.58 million on $250,422 of revenues for the same period in 2013. The Company's balance sheet at May 31, 2014, showed $15.50 million in total assets, $4.35 million in total liabilities and $11.15 million in total shareholders' equity. A full-text copy of the Report is available for free at: http://is.gd/mr6XTp About Stellar Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.'s business is to commercially produce and market Keyhole Limpet Hemocyanin ("KLH") as well as to develop new technology related to culture and production of KLH and subunit KLH ("suKLH") formulations. The Company markets KLH and suKLH formulations to customers in the United States and Europe. KLH is used extensively as a carrier protein in the production of antibodies for research, biotechnology and therapeutic applications. Stellar Biotechnologies incurred a loss and comprehensive loss of $14.88 million on $545.46 million of revenues for the year ended Aug. 31, 2013, as compared with a loss and comprehensive loss of $5.19 million on $286.05 million of revenues for the year ended Aug. 31, 2012. The Company incurred a loss and comprehensive loss of $3.59 million for the year ended Aug. 31, 2011. SUPER BUY FURNITURE: Can Employ Louis Carrasquillo as Consultant ---------------------------------------------------------------- Judge Enrique S. Lamoutte of the U.S. Bankruptcy Court for the District of Puerto Rico authorized Super Buy Furniture Inc. to employ Louis R. Carrasquillo as financial consultant. Super Buy Furniture, Inc., filed a Chapter 11 bankruptcy petition (Bankr. D.P.R. Case No. 14-05523) on July 3, 2014. The petition was signed by Carlos N. Berrios Casillas as president. O'Neill & Borges, LLC, serves as the Debtor's counsel. CPA Luis R. Carrasquillo & Co. P.S.C. acts as the Debtor's financial consultant. The Debtor disclosed total assets of $18.2 million and total liabilities of $26.7 million. SUPER BUY FURNITURE: Luis Biaggi Employment Has Court Approval -------------------------------------------------------------- Super Buy Furniture Inc. sought and obtained authority from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Luis C. Marini Biaggi as attorney. Super Buy Furniture, Inc., filed a Chapter 11 bankruptcy petition (Bankr. D.P.R. Case No. 14-05523) on July 3, 2014. The petition was signed by Carlos N. Berrios Casillas as president. O'Neill & Borges, LLC, serves as the Debtor's counsel. CPA Luis R. Carrasquillo & Co. P.S.C. acts as the Debtor's financial consultant. The Debtor disclosed total assets of $18.2 million and total liabilities of $26.7 million. TACTICAL INTERMEDIATE: Files Liquidating Plan --------------------------------------------- Tactical Intermediate Holdings, Inc., which is selling its assets, filed a liquidating plan premised on the terms of a plan support agreement reached with secured lenders. The Plan is a waterfall plan and the proceeds of the sales will be applied in the order of absolute priority. The Plan contemplates that the assets of the estates at the time of confirmation will remain property of the Debtors' estates and be subject to administration by a plan administrator. The plan administrator will establish the appropriate reserves and then make distributions that follow the distribution priority scheme set forth in the Bankruptcy Code. The recoveries under the Plan will largely be determined by the results of the sales, which are unknown at this point. The current version of the Plan indicates that holders of allowed interests will receive no distributions on account of their interests under the Plan. A copy of the Plan is available for free at: http://bankrupt.com/misc/Tactical_Liquidating_Plan.pdf About Tactical Intermediate Tactical Intermediate Holdings, Inc., and its affiliates' operations are comprised of two major lines of business -- a footwear line, and a fabric and clothing line, including flame resistant material ("Massif"). Footwear is comprised of the Altama group ("Altama") and the Wellco Group ("Wellco"). Wellco was founded in 1941 and manufactures and sells combat boots, primarily for the United States Military as well as commercial uniform and work boots for a variety of customers. Altama was founded in 1969 and manufactures and sells boots for the United States and international militaries as well as for federal, state and local agencies, military schools, police, uniform shops and Army/Navy retailers. Headquartered in Ashland, Oregon, Massif was founded in 1999 by a group of veteran search and rescue team members and alpine climbers who believed that the options for sanctioned fire resistant protective gear at the time were too limited. Massif is a world leader in supplying flame resistant and high performance outdoor apparel to the military, law enforcement, search and rescue professionals, and the wildland firefighting community. Tactical Intermediate Holdings, Inc., and its affiliates sought Chapter 11 protection in Delaware on July 8, 2014, with plans to quickly sell their assets. Judge Kevin Gross is assigned to the Chapter 11 cases. The Debtors have requested joint administration of the cases under Case No. 14-11659. The Debtors have tapped Klehr Harrison Harvey Branzburg LLP as counsel, FTI Consulting, Inc., as financial advisor, Houlihan Lokey Capital, Inc., as investment banker, and PrimeClerk as claims and noticing agent. Massif Apparel Enterprises LLC, the entity formed by Sun Capital Partners Group V LLC, to serve as stalking horse bid for Massif's assets, is represented by Corey Fox, Esq., Brad Weiland, Esq., and Gregory F. Fesce, Esq., at Kirkland & Ellis LLP. TACTICAL INTERMEDIATE: Wants July 31 Auction for Footwear Assets ---------------------------------------------------------------- Tactical Intermediate Holdings, Inc., and its affiliated-debtors filed proposed bidding procedures in connection with the sale of all of their footwear business assets by public auction. The Debtors marketed the assets prepetition. The Debtors negotiated a stalking horse purchase agreement for the sale of their flame resistant and apparel and fabric business assets and have filed separate pleadings to seek approval of bidding procedures and sale approval of that sale. Unfortunately, the Debtors were unable to successfully locate a buyer for its footwear assets prior to the Petition Date. In connection with the sale of the footwear assets, the Debtors propose these procedures and timeline: -- A hearing on the bidding procedures will be held on or before July 21, 2014. -- Initial bids for the assets are due one business day prior to the auction. -- An auction and sale hearing will be held by July 31, 2014. -- Prior to the bidding procedures hearing date, the Debtors may seek authority to offer a bidder a break-up fee in n amount not to exceed 3% of the total guaranteed cash price plus reimbursement of expense, which bidder will serve as the "stalking horse" bidder at the auction. -- Net cash proceeds from the closing of the sale of the footwear assets will be remitted at closing to Wells Fargo, first for repayment of any outstanding balance on the DIP facility, and then for provisional application to the unpaid balance of the prepetition senior secured facility. Footwear has five contracts with the United States Government that are indefinite delivery, indefinite quantity ("IDIQ") contracts which have remaining durations ranging from one to four years. The largest contracts that the Debtors have with the U.S. Government are with the Defense Logistics Agency. Counsel for the Debtors, Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, explains that the Debtors have had several discussions with the DLA regarding the current financial condition of the Debtors and plans of the Debtors to sell the business. The DLA indicated that they need to know whether the footwear business would be continuing as a going concern by the end of July 2014. The DLA also indicated that it will soon, before the end of July 2014, be diverting delivery orders on two of the government contracts. If the sale of the Debtors' footwear business is completed by the first week of August and manufacturing resumes within two weeks after the sale closing, the earliest that a purchaser could likely resume delivery of boots to the U.S. Government would be approximately six weeks after a sale closing. The Debtors and the U.S. Government are currently discussing options for these governmental contracts. Furthermore, the Debtors' workforce with respect to its footwear business were given WARN Act notices in May 2014, pending a potential shut-down of operations. Accordingly, Mr. Pacitti avers that it is crucial that a sale of the footwear assets as a going concern be completed by the end of July 2014, because after that date it is likely that the DLA will move some, if not all, the remaining government contracts to alternative suppliers leaving the Debtors without its largest customer. Without its largest customer, the Debtors believe that they would lose the opportunity to sell to a going concern buyer and be forced to liquidate their footwear assets. About Tactical Intermediate Tactical Intermediate Holdings, Inc., and its affiliates' operations are comprised of two major lines of business -- a footwear line, and a fabric and clothing line, including flame resistant material ("Massif"). Footwear is comprised of the Altama group ("Altama") and the Wellco Group ("Wellco"). Wellco was founded in 1941 and manufactures and sells combat boots, primarily for the United States Military as well as commercial uniform and work boots for a variety of customers. Altama was founded in 1969 and manufactures and sells boots for the United States and international militaries as well as for federal, state and local agencies, military schools, police, uniform shops and Army/Navy retailers. Headquartered in Ashland, Oregon, Massif was founded in 1999 by a group of veteran search and rescue team members and alpine climbers who believed that the options for sanctioned fire resistant protective gear at the time were too limited. Massif is a world leader in supplying flame resistant and high performance outdoor apparel to the military, law enforcement, search and rescue professionals, and the wildland firefighting community. Tactical Intermediate Holdings, Inc., and its affiliates sought Chapter 11 protection in Delaware on July 8, 2014, with plans to quickly sell their assets. Judge Kevin Gross is assigned to the Chapter 11 cases. The Debtors have requested joint administration of the cases under Case No. 14-11659. The Debtors have tapped Klehr Harrison Harvey Branzburg LLP as counsel, FTI Consulting, Inc., as financial advisor, Houlihan Lokey Capital, Inc., as investment banker, and PrimeClerk as claims and noticing agent. Massif Apparel Enterprises LLC, the entity formed by Sun Capital Partners Group V LLC, to serve as stalking horse bid for Massif's assets, is represented by Corey Fox, Esq., Brad Weiland, Esq., and Gregory F. Fesce, Esq., at Kirkland & Ellis LLP. THERAPEUTICSMD INC: FMR LLC Holds 11.5% Equity Stake ---------------------------------------------------- FMR LLC, Edward C. Johnson 3d, and Abigail P. Johnson disclosed with the U.S. Securities and Exchange Commission on July 9, 2014, that they beneficially owned 16,681,539 shares of common stock of TherapeuticsMD, Inc., representing 11.470 percent of the shares outstanding. A full-text copy of the regulatory filing is available for free at http://is.gd/s8DkfV About TherapeuticsMD Boca Raton, Florida-based TherapeuticsMD, Inc. (OTC QB: TXMD) is a women's healthcare product company focused on creating and commercializing products targeted exclusively for women. The Company currently manufactures and distributes branded and generic prescription prenatal vitamins as well as over-the-counter vitamins and cosmetics. The Company is currently focused on conducting the clinical trials necessary for regulatory approval and commercialization of advanced hormone therapy pharmaceutical products designed to alleviate the symptoms of and reduce the health risks resulting from menopause-related hormone deficiencies. TherapeuticsMD reported a net loss of $28.41 million in 2013, a net loss of $35.12 million in 2012, and a net loss of $12.9 million in 2011. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2012, Rosenberg Rich Baker Berman & Company, in Somerset, New Jersey, expressed substantial doubt about TherapeuticsMD's ability to continue as a going concern, citing the Company's loss from operations of approximately $16 million and negative cash flow from operations of approximately $13 million. The Company's balance sheet at March 31, 2014, showed $53.56 million in total assets, $6.81 million in total liabilities and $46.75 million in total stockholders' equity. THOMPSON CREEK: Reports Production Results for Second Quarter ------------------------------------------------------------- Thompson Creek Metals Company Inc. announced production results for the three and six months ended June 30, 2014, for its three operating mines, Mt. Milligan, Thompson Creek and Endako. Total concentrate production for Mt. Milligan for the quarter ended June 30, 2014, was 29.7 thousand dry tonnes, with 16.0 million pounds of payable copper and 37.0 thousand ounces of payable gold. Total concentrate production for Mt. Milligan for the six months ended June 30, 2014, was 57.9 thousand dry tonnes, with 30.3 million pounds of payable copper and 76.2 thousand ounces of payable gold. Molybdenum production was 7.5 million pounds for the second quarter of 2014 and 15.4 million pounds for the first six months of 2014. Q2 2014 YTD 2014 Production Sales Production Sales ---------- ----- ---------- ----- Copper and Gold Mt. Milligan Mine Payable Copper (million lbs) 16.0 21.9 30.3 32.8 Payable Gold (000's oz) 37.0 52.0 76.2 75.9 Molybenum (1) Thompson Creek Mine Molybdenum (million lbs) 5.1 5.5 10.8 11.3 Endako Mine (75% share) Molybdenum (million lbs) 2.4 2.0 4.6 4.7 ------------ ------------- Total Molybdenum(million lbs) 7.5 7.5 15.4 16.0 ------------ ------------- (1) Molybdenum production pounds reflected are molybdenum oxide and HPM from our mines. Mt. Milligan Mine The ramp-up at Mt. Milligan continues to progress well with mine pit grades and metal recoveries as expected, and mill throughput steadily improving. During the second quarter of 2014, the Company made three shipments of copper and gold concentrate under its sales agreements and received provisional payments for all three of those shipments. The Company received an additional provisional payment for a shipment that took place in the first quarter of 2014. The timing of the gold and copper concentrate shipments and related provisional payments from Mt. Milligan are based on the structure of the Company's sales agreements. "We are pleased with our production results and safety performance for this quarter, and in particular, with the operational performance at Mt. Milligan Mine," said Jacques Perron, chief executive officer of Thompson Creek. "After a number of adjustments in April and May, we achieved an average of 48,065 tonnes per day for the month of June with a record daily mill throughput of 63,970 tonnes on June 16. These operational results are significant milestones for us at this stage of the ramp-up. We continue to expect fluctuations in mill throughput until 75 - 80% of design capacity is reached later this year." Thompson Creek Mine At Thompson Creek Mine, molybdenum production for the second quarter of 2014 was better than expected primarily due to higher ore grades and mill recoveries. Mining of Phase 7 ore is expected to be completed in the third quarter of this year, with stockpiled ore being processed thereafter. Endako Mine At Endako Mine, molybdenum production for the second quarter of 2014 was lower than expected. Operational challenges associated with maintaining a consistent feed from the mine to the mill, tailings operational issues, and lower than expected ore grades and recoveries during the second quarter adversely impacted production results. About Thompson Creek Metals Thompson Creek Metals Company Inc. is a growing, diversified North American mining company. The Company produces molybdenum at its 100%-owned Thompson Creek Mine in Idaho and Langeloth Metallurgical Facility in Pennsylvania and its 75%-owned Endako Mine in northern British Columbia. The Company is also in the process of constructing the Mt. Milligan copper-gold mine in central British Columbia, which is expected to commence production in 2013. The Company's development projects include the Berg copper-molybdenum-silver property and the Davidson molybdenum property, both located in central British Columbia. Its principal executive office is in Denver, Colorado and its Canadian administrative office is in Vancouver, British Columbia. More information is available at http://www.thompsoncreekmetals.com * * * As reported by the TCR on July 1, 2014, Standard & Poor's Ratings Services raised its long-term corporate credit rating on mining company Thompson Creek Metals Co. to 'B-' from 'CCC+'. "The upgrade primarily reflects the decline in liquidity risk Thompson Creek faces following commercial production from its Mt. Milligan mine and reduced capital requirements associated with the project," said Standard & Poor's credit analyst Jarrett Bilous. In the May 9, 2012, edition of the TCR, Moody's Investors Service downgraded Thompson Creek Metals Company Inc.'s Corporate Family Rating (CFR) and probability of default rating to Caa1 from B3. Thompson Creek's Caa1 CFR reflects its concentration in molybdenum, relatively small size, heavy reliance currently on two mines, and the need for favorable volume and price trends in order to meet its increasingly aggressive capital expenditure requirements over the next several years. TRADE SECRET: Buyer Loses Appeal Over Houston BW Ruling ------------------------------------------------------- Delaware District Judge Leonard P. Stark dismissed appeals taken by Regis Corporation from the Delaware Bankruptcy Court's Order Granting Motion to Enforce Order Dismissing Chapter 11 Cases and Order Granting Motion for Attorneys' Fees entered in the Chapter 11 cases of Premier Salons Beauty Inc., Trade Secret Inc., and their affiliates. When the Debtors filed for Chapter 11 bankruptcy in 2010, they owed Regis over $32 million. In September 2010, the Bankruptcy Court authorized the sale of the Debtors' assets pursuant to an Asset Purchase Agreement. Regis was the "Purchaser" of the Debtors' assets, while Pure Beauty Salons & Boutiques, Inc. and BeautyFirst Franchise Corp. -- which were created during the pendency of the Debtors' Chapter 11 proceedings -- were assignees. The Pure Beauty Entities, as well as the rest of the Debtors, were owned by the Luborsky Family Trust II 2009 and its sole beneficiaries: Brian Luborsky, who was the CEO and director of Debtor Trade Secret, Inc., and his family. On October 12, 2010, after the assets were sold, the Debtors filed a motion for an order approving dismissal of the Debtors' Chapter 11 cases. On January 31, 2011, the Bankruptcy Court entered an order granting the Dismissal Motion. The Dismissal Order provides, in part, that the "Purchaser, its successors and assigns shall, pay. . . any and all amounts as may be awarded, if any, to the Franchisees in connection with any pending Arbitration Proceeding." The Dismissal Order further provides that "[a]ll terms not otherwise defined herein shall be given the meanings ascribed to them in the [Dismissal] Motion." The Dismissal Order also specified that the Bankruptcy Court retained jurisdiction to enforce payment. After an arbitrator entered an award in favor of Houston BW, Inc., a franchisee of the Debtors, Houston filed a notice of the award with the Bankruptcy Court. In November 2011, after Houston was unsuccessful in its efforts to obtain payment from either the Pure Beauty Entities or Regis, Houston filed a motion in the Bankruptcy Court to enforce the Dismissal Motion against Regis. The Bankruptcy Court granted the motion and, on June 8, 2012, required Regis to pay Houston the arbitration award as per the Dismissal Order. The Bankruptcy Court found that the arbitration agreement also required that Regis pay Houston's reasonable attorneys' fees. Regis argues that the Bankruptcy Court's Enforcement Order should be reversed because Houston has no right to recover from Regis under the APA, the Assignment Agreement (which named the Pure Beauty Entities as the Assignees), or the Bankruptcy Court's order approving the sale of the Debtors' assets. Regis also contends that the Dismissal Order does not vest Houston with the right to recover the arbitration award because, "reading the documents [Dismissal Motion and the APA] as a whole . . . it is clear that no obligations were being assumed by Regis" under the Dismissal Order. Regis also seeks reversal of the Bankruptcy Court's award of attorneys' fees because there was no separate agreement between the parties for attorneys' fees or, in the alternative, because only reasonable attorneys' fees may be awarded, but the Bankruptcy Court awarded Houston more than that amount. Houston counters that Regis is attempting to collaterally attack the finality of the Dismissal Order, which was entered more than a year prior to Regis' filing of a notice of appeal. Further, because Regis may only properly appeal the Bankruptcy Court's order enforcing the Dismissal Order, the issue before the District Court is simply whether the Bankruptcy Court "properly interpreted the Dismissal Order in its Enforcement Order." Not only did the Bankruptcy Court commit no clear error, Houston contends, but there is also ample evidence to support that Court's findings of fact. Houston also notes that because the franchise agreements provide for the award of attorneys' fees to the prevailing party in an arbitration, such fees are a necessary part of what Regis owes Houston as a cure. According to the District Court, the Enforcement Order constitutes a reasonable interpretation by the Bankruptcy Court of its own Dismissal Order, and, hence, an act the District Court will not disturb on appeal. "Even assuming that some or all of the parties to the APA intended that Regis would not assume the Debtors' liabilities to Houston, the Bankruptcy Court's determination that its (unappealed) Dismissal Order places these liabilities with Regis does not constitute an abuse of discretion." The District Court also finds that the Bankruptcy Court did not err in awarding attorneys' fees to Houston. The parties do not dispute that the franchise agreements require the award of attorneys' fees; rather, Regis disputes whether the franchise agreement's provision requiring attorneys' fees applies to Regis at all and whether the Bankruptcy Court erred in determining the specific amount of the award. The case is, REGIS CORPORATION, Appellant, v. HOUSTON BW, INC., Appellee, CONSOLIDATED CASE C.A. NO. 13-291-LPS (D. Del.). A copy of the Court's July 7, 2014 Memorandum Order is available at http://is.gd/UvR6rmfrom Leagle.com. Regis Corporation is represented by: Kathleen M. Miller, Esq. SMITH, KATZENSTEIN, & JENKINS LLP 800 Delaware Ave Wilmington, DE 19801 Tel: 302-504-1699 Fax: 302-652-8405 E-mail: kmiller@skjlaw.com Houston BW Inc., is represented by: William F. Taylor, Jr., Esq. MCCARTER & ENGLISH, LLP 405 N King St Wilmington, DE 19801 Tel: (302) 984-6313 E-mail: wtaylor@mccarter.com About Premier Salons Premier Salons Beauty Inc., Trade Secret Inc., and six affiliates filed for bankruptcy protection on July 6 (Bankr. D. Del. Lead Case No. 10-12153). The Chapter 11 petitions of Premier Salons and Trade Secret each estimated assets of up to $50,000 and debts of up to $50 million. Trade Secret and its affiliates currently own and operate approximately 612 retail and salon locations in shopping malls and strip centers throughout the United States and Puerto Rico, on a collective basis. The Trade Secret Group consists of stores operating primarily under four trade names: Trade Secret, Beauty Express, BeautyFirst, and PureBeauty(R). Joseph M. Barry, Esq., at Young, Conaway, Stargatt & Taylor, represents the Debtors in their Chapter 11 effort. Epiq Bankruptcy Solutions, LLC, is claims agent to the Debtors. Non-debtor affiliates Premier Salons, Inc. and Premier Salons Ltd. and its U.S. and Canadian corporate affiliates own and operate 340 hair and cosmetic service salons throughout North America, with locations in specialty stores such as Saks, Sears, and Macy's. TRUMP ENTERTAINMENT: Confirms Sept. 16 Closure of Trump Plaza ------------------------------------------------------------- Wallace McKelvey, writing for the Press of Atlantic City, reported that the owners of Trump Plaza Hotel and Casino confirmed Saturday that it could join three other properties in closing if a buyer is not found. The report said Trump Entertainment Resorts told The Associated Press that while a final decision about Trump Plaza hasn't been made, it expects the casino to close Sept. 16. Notices warning more than 1,000 employees will go out Monday. According ot the report, Trump Plaza, which opened in 1984 under the tutelage of its namesake, Donald Trump, joins Revel Casino- Hotel and Showboat Casino Hotel in announcing closings at the end of the summer tourist season. The latter two properties employ about 3,100 and 2,100 people, respectively. According to the report, experts say the impact of losing an estimated 7,800 jobs since the January closing of the Atlantic Club Casino Hotel would ripple across the region and hurt the resort's marketing efforts in an already stagnant economy. Atlantic Club's closing left about 1,600 without work. The report noted that analysts say the closings could relieve pressure on Atlantic City's other eight casinos amid increasing competition from newer casinos in neighboring states. The report recounted that Trump had previously sent out layoff notices in March 2013 when a $20 million sale was pending. That sale was ultimately put on hold, but in May the property reported its biggest decline in gambling win. It reported about $4 million, a 26 percent decline from 2013. TRW AUTOMOTIVE: Non-binding Proposal No Impact on Moody's Ba1 CFR ----------------------------------------------------------------- Moody's Investors Service said the announcement by TRW Automotive, Inc. that is has received a preliminary, non-binding proposal to be acquired may evolve into negative credit event, but does not currently impact TRW's Ba1 Corporate Family Rating, Speculative Grade Liquidity Rating at SGL-2, and positive outlook. The last rating action for TRW was on November 18, 2013 when the Corporate Family Rating was raised to Ba1 and positive rating outlook was maintained. The principal methodologies used in rating TRW were the Global Automotive Supplier Industry published in May 2013, and the Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found on Moody's website. TRW Automotive, Inc. (TRW) , headquartered in Livonia, MI, is among the world's largest and most diversified suppliers of safety related automotive systems, modules, and components to global vehicle manufacturers and related aftermarket. The company has four operating segments: Chassis Systems, Occupant Safety Systems, Automotive Components, and Electronics. Its primary business lines encompass the design, manufacture, and sale of active and passive safety related products. Revenues in 2013 were approximately $17.4 billion. UNIFRAX I: Moody's Affirms B2 Corp. Family Rating; Outlook Neg. --------------------------------------------------------------- Moody's Investors Service affirmed all ratings for Unifrax I LLC, including the B2 Corporate Family Rating ("CFR"), and revised the rating outlook to negative from stable following the announcement that the company will take a minority stake in a Chinese competitor in a transaction funded primarily by incremental debt. "The transaction provides a much better foothold in China, but the debt financing stresses credit metrics and exhausts financial flexibility in the B2 rating," said Ben Nelson, Moody's Assistant Vice President and lead analyst for Unifrax I LLC. Unifrax has entered into a share purchase agreement to take a 29% stake in Chinese ceramic fiber producer Shandong Luyang Share Co., Ltd. ("Luyang") for $116 million. The company will also sell its fiber plant in Suzhou to Luyang for $17 million. Unifrax will fund the remaining amount, along with transaction-related fees and expenses, with proceeds from $30 million incremental term loan, $53 million add-on notes offering, and balance sheet cash. The purchase price represents an effective multiple of over 11 times trailing twelve months EBITDA for Luyang. The outlook revision incorporates the risks associated with a significant expansion into the Chinese market and expectations for credit metrics to remain outside the boundaries of the B2 rating for longer than anticipated previously, a consequence of the debt component of the proposed transaction and indicative of increased sponsor willingness to leverage the balance sheet in pursuit of strategically-important transactions. Unifrax has been aggressive in pursuit of such transactions by increasing adjusted financial leverage from the mid 4 times (Debt/EBITDA) at the initial rating assignment in late 2011 to the mid 5 times to acquire a specialty fibers business in early 2013 and by Moody's calculations, to about 6 times to expand its presence in the Chinese market with a minority stake in Luyang (including proportional treatment of Luyang's EBITDA according to Unifrax's expected economic ownership). The Luyang transaction will create short-term opportunities through the planned installation of certain licensed Unifrax technologies in Luyang's fiber plants and long-term opportunities as both companies' earnings stand to benefit from cross-selling and other strategic opportunities. These opportunities are not without risk as Moody's does not expect the investment will generate significant cash dividends unless the technology implementation is successful. The affirmation of the ratings despite these risks reflects solid expected interest coverage and cash flow metrics, potential to improve earnings through realizing substantial transaction-related synergies, and expectations for an improved near-term macroeconomic environment in Europe. The actions: Affirmations: Issuer: Unifrax I LLC (New) Corporate Family Rating, Affirmed B2; Probability of Default Rating, Affirmed B2-PD; Senior Secured Credit Facilities, Affirmed B1 (LGD3); Senior Unsecured Notes, Affirmed Caa1 (LGD5); Assignments: Incremental Senior Secured Term Loan, B1 (LGD3); Incremental Senior Unsecured Notes, Caa1 (LGD5); Outlook, Changed to Negative from Stable. The ratings are subject to Moody's review of the final terms and conditions of the proposed transactions. Ratings Rationale The B2 CFR is constrained by the company's narrow product line of ceramic and glass fiber products, exposure to cyclical automotive and industrial end markets, and high leverage position. The rating incorporates some tolerance for variation in earnings due to the nature of the end markets, but anticipates relatively stable profit margins on a through-the-cycle basis and low maintenance capital requirements will help stabilize cash flows. The rating also benefits from strong market positions, broad customer base, and operational and geographic diversity. Good liquidity is also an important factor supporting the rating. The negative outlook reflects high leverage metrics, limited resilience within the current rating for unforeseen shortfalls in operating performance, and execution risks associated with the Luyang acquisition. Moody's could downgrade the rating with expectations for leverage sustained above 5.5 times, marginal or negative free cash flow generation, or weakening in the company's liquidity position. Moody's could stabilize with leverage trending back toward 5 times and retained cash flow near 10% (RCF/Debt). Moody's could upgrade the rating with expectations for leverage below 4 times and retained cash flow to debt above 10% on a sustained basis. An upgrade would require a commitment to more conservative financial policies. The principal methodology used in this rating was Global Chemical Industry Rating Methodology published in December 2013. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Unifrax I LLC produces heat-resistant ceramic fiber products and specialty glass microfiber materials for a variety of industrial applications. Private equity firm American Securities acquired the company in a leveraged buyout transaction from private equity firm AEA Investors in late 2011 after selling the business to AEA in 2007. Headquartered in Tonawanda, N.Y., Unifrax generated revenues of approximately $511 million for the twelve months ended March 31, 2014. UNIFRAX I: S&P Affirms 'B+' Rating on 1st Lien Debt --------------------------------------------------- Standard & Poor's Ratings Services said it has affirmed its 'B' corporate credit rating on Unifrax Holding Co. The outlook is stable. At the same time, S&P also affirmed its 'B+' issue-level rating on Unifrax I LLC's first-lien facility and its 'B-' rating on its senior unsecured notes. The recovery ratings on both debt issues are unchanged, at '2' and '5', respectively. "The rating affirmation is based on our expectation that moderately improving end-market demand will lead to EBITDA growth and gradual improvement in the company's credit measures following the incremental debt issuance," said Standard & Poor's credit analyst Svetlana Olsha. Proceeds will be used to fund a minority interest stake in unrated Shandong Luyang Share Co. The Luyang investment will expand Unifrax's presence in the Chinese refractory ceramic fiber market and is consistent with Unifrax's strategy of expansion in high-growth emerging markets. Unifrax has a limited scale of operations as a niche producer of specialty insulating materials for industrial thermal management, automotive emission control, fire protection, and battery separator and filtration markets. S&P expects the company to maintain significant market share globally as one of the top two competitors in its segments; the remaining competition generally consists of smaller regional players. S&P also expects Unifrax to continue generating a significant proportion of revenue from maintenance and replacement demand and from consumable products-- primarily in its industrial segment--which we believe helps reduce volatility in earnings and cash flow. However, the company's end markets will likely remain cyclical, fragmented, and highly competitive. S&P assess Unifrax's business risk profile as "weak." S&P's assessment of Unifrax's financial risk profile as "highly leveraged" reflects leverage of 6x pro forma for the incremental debt issuance. S&P expects the company to continue making bolt-on acquisitions that complement its existing manufacturing capabilities and products and to fund purchases with both cash on hand and debt. The outlook is stable. Unifrax's improving end-market conditions, good niche market positions, and above-average EBITDA margins should help sustain credit measures that are appropriate for the rating, specifically debt to EBITDA of 5x to 6x and FFO to debt of about 10%. S&P could lower the rating if weak operating performance causes credit measures to deteriorate for an extended period, specifically if leverage exceeds 6x. S&P could also lower the rating if the company is unable to generate positive free cash flow and liquidity becomes constrained. S&P could raise the rating if stronger-than-expected growth in the company's end markets leads to high cash flow generation and debt reduction such that financial leverage declines to and remains below 5x. For an upgrade, S&P would also need to believe the company would adhere to a less aggressive financial policy consistent with a higher rating. UNIVERSAL BIOENERGY: Metwood Owns Majority of Outstanding Shares ---------------------------------------------------------------- Metwood Inc. and Global Energy Group LLC entered into a Member Interests Purchase Agreement, dated June 30, 2013, pursuant to which Metwood acquired Global Energy. On June 30, 2013, Global Energy directly owned 1,568,630,000 shares of Universal Bioenergy's common stock. The 1,568,630,000 shares was the equivalent of 61.78% of the Company's 2,538,903,268 outstanding shares of common stock that were issued and outstanding on May 20, 2013, as reported in the Company's Form 10-Q Report for the period ended March 31, 2013. Due to the acquisition of Global Energy Group LLC by Metwood, Metwood may be deemed to have indirect beneficial ownership of the shares of which Global Energy Group LLC directly beneficially owns. As a result of the acquisition of Global Energy Group LLC by Metwood Inc., on June 30, 2013, a change of control of Universal Bioenergy occurred. A full-text copy of the Form 8-K is available for free at: http://is.gd/5C2ft1 About Universal Bioenergy Headquartered in Irvine, California, Universal Bioenergy Inc. develops markets alternative and natural energy products including, natural gas, solar, biofuels, wind, wave, tidal, and green technology products. Universal Bioenergy incurred a net loss of $623,518 on $60.21 million of revenues for the year ended June 30, 2013, as compared with a net loss of $4.12 million on $57.32 million of revenues for the year ended June 30, 2012. Bongiovanni & Associates, CPA's, in Cornelius, North Carolina, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the the Company has suffered recurring operating losses, has an accumulated deficit, has negative working capital, and has yet to generate an internal cash flow that raises substantial doubt about its ability to continue as a going concern. UNIVERSAL HEALTH: Settlement on Appointment Motion Approved ----------------------------------------------------------- Judge K. Rodney May of the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, approved the settlement among Soneet R. Kapila, as the duly appointed Chapter 11 Trustee for the estate of Universal Health Care Group, Inc., which entity serves as the sole member of American Managed Care, LLC; BankUnited, N.A.; Jean Johnson, Special Deputy Receiver for Universal HMO of Texas, Inc.; Cantilo & Bennett, L.L.P., Special Deputy Receiver of Universal Health Care of Nevada, Inc., after finding that the compromise satisfies all of the legal requirements for approval, the compromise is the product of arms-length negotiations, and the compromise is in the best interest of the creditors and the bankruptcy estate of Universal Health. The settlement resolves legal issues arising from the Trustee's appointment of Mark Abernathy as sole director of Universal Health's subsidiaries, Universal HMO of Texas, Inc., and Universal Health Care of Nevada, Inc. BankUnited supported the Appointment Motion, but the Nevada Receiver and Texas Receiver, along with the Florida Department of Financial Services in its capacity as receiver for Universal Health Care, Inc. and Universal Health Care Insurance Company, Inc., opposed the Motion. Attorneys for the Chapter 11 Trustee and American Managed Care, LLC, are Roberta A. Colton, Esq., and Rhys P. Leonard, Esq., at Trenam, Kemker, Scharf, Barkin, Frye, O'neill & Mullis, PA, in Tampa, Florida; and Attorney for BankUnited is Frank P. Terzo, Esq., at GrayRobinson, P.A., in Tampa, Florida. Attorney for Jean Johnson, the Special Deputy Receiver of Universal HMO of Texas, Inc., is Robert H. Nunnally, Jr., Esq., at Wisener * Nunnally * Gold, LLP, in Garland, Texas. Special Deputy Receiver Universal Health Care of Nevada, Inc., is Patrick H. Cantilo, Esq., at Cantilo & Bennett, L.L.P., in Austin, Texas. About Universal Health Care Universal Health Care Group, Inc., owns an insurance company and three health-maintenance organizations that provide managed care services for government sponsored health care programs, focusing on Medicare and Medicaid. Universal Health was founded in 2002 by Dr. A.K. Desai and grew its operations of offering Medicare plans to more than 37,000 members to over 20 states. Universal Health filed a Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 13-01520) on Feb. 6, 2013, after Florida regulators moved to put two of the company's subsidiaries in receivership. Universal Health Care estimated assets of up to $100 million and debt of less than $50 million in court filings in Tampa, Florida. Harley E. Riedel, Esq., at Stichter Riedel Blain & Prosser, in Tampa, serves as counsel to the Debtor. Soneet R. Kapila has been appointed the Chapter 11 Trustee in the Debtor's case. He is represented by Roberta A. Colton, Esq., at Trenam, Kemker, Scharf, Barkin, Frye, O'Neill & Mullis, PA. Dennis S. Jennis, Esq., and Jennis & Bowen, P.L., serve as special conflicts counsel and E-Hounds, Inc. serves as a forensic imaging consultant to the Chapter 11 trustee. VAIL LAKE: Lee & Associates Approved as Real Estate Broker ---------------------------------------------------------- The Bankruptcy Court authorized Vail Lake Rancho California, LLC, to expand the scope of employment of Lee & Associates Commercial Real Estate Services - North San Diego County, Inc., as real estate broker. The Debtor is represented by: Ori Katz, Esq. J. Barrett Marum, Esq. Robert K. Sahyan, Esq. SHEPPARD, MULLIN, RICHTER & HAMPTON LLP 501 West Broadway, 19th Floor San Diego, CA 92101 Tel: (619) 338-6500 Fax: (619) 234-3815 The Debtors stated that the property to be marketed and sold by Lee & Associates will consist of (i) the Original Properties; (ii) VLUSA's property, which consists of approximately 6,221 acres of predominantly undeveloped real estate; (iii) VLVR's property, which consists of an approximately 362 acre RV park; and (iv) the remainder of VLRC's property that was not included in the Employment Order, which consists of approximately 525 acres, including the site the Debtors use as a venue for the concerts and other events the Debtors' put on, together with all of the Debtors' lake and water rights, whatever they may be. Lee & Associates is expected to: a. list the property on an appropriate listing service; b. market the property directly to prospective purchasers on Lee & Associates' contact list; c. advertise the property in various publications; d. feature the property on websites; and e. show the property to prospective purchasers. The Debtors agreed to compensate Lee & Associates according to the Listing Agreement. The Listing Agreement, as with the listing agreements filed with the Original Application, provides that Lee & Associates will be compensated for its services in an amount equal to three percent of the gross sales price. Each buyer's broker will be compensated by their respective buyer. About Vail Lake Vail Lake Rancho California, LLC, and its affiliates own the California campground Vail Lake Resort. Vail Lake is a large reservoir in western Riverside County, California, located on Temecula Creek in the Santa Margarita River watershed, approximately 15 miles east of Temecula, California. Properties cover approximately 9,000 acres and have an estimated water storage capacity of approximately 51,000 acre-feet. On Dec. 26, 2012, creditors of Vail Lake filed an involuntary Chapter 11 petition (Bankr. S.D. Cal. Case No. 12-16684) for Vail Lake. In a filing on June 6, 2013, the Debtor said it consents to the entry of an order for relief and does not contest the involuntary Chapter 11 petition. On June 5, 2013, the company sent 5 related entities -- Vail Lake USA, LLC ("VLU"), Vail Lake Village & Resort, LLC ("VLRC"), Vail Lake Groves, LLC, Agua Tibia Ranch, LLC, and Outdoor Recreational Management, LLC -- to Chapter 11 bankruptcy. The new debtors have sought and obtained an order for joint administration of their Chapter 11 cases with Vail Lake Rancho (Case No. 12-16684). The Debtors are represented by attorneys at Cooley LLP and Phillips, Haskett & Ingwalson, A.P.C. The Debtor also employed Thomas C. Hebrank and E3 Realty Advisors, Inc., with Mr. Hebrank serving as the Debtors' chief restructuring officer. Lee & Associates Commercial Real Estate Services is the real estate brokers of the Debtors. The Debtors' consolidated assets, as of May 31, 2013, total $291,016,000 and liabilities total $52,796,846. WALTER ENERGY: Obtains Add'l $61.2MM Revolving Credit Facility -------------------------------------------------------------- Walter Energy, Inc., on July 7, 2014, received the required consents to an amendment to the Company's $2.725 billion credit agreement, dated as of April 1, 2011, by and among Walter Energy, Inc., certain subsidiaries of Walter Energy, Inc., the lenders party thereto and Morgan Stanley Senior Funding, Inc., as Administrative Agent from a majority of the lenders thereunder. The Seventh Amendment, among other things, modifies the financial maintenance ratio to be unlimited for the quarter ended June 30, 2014, so long as the Company issues at least $275 million of additional first lien notes within seven days (or such longer period during the fiscal quarter ending Sept. 30, 2014, as may be determined by the administrative agent of the Credit Agreement) of the effective date of the Seventh Amendment. A full-text copy of the 7th Amendment is available at http://is.gd/CBnQx5 On July 8, 2014, the Company entered into an amendment to the Credit Agreement with certain lenders thereunder. The Eighth Amendment, among other things, provides the Company with an additional tranche of revolving loan commitments in the amount of $61.2 million, thereby increasing the total available commitments under the revolving credit facility in the Credit Agreement to $375 million. The New Revolving Credit Facility Tranche will mature in 2017. Effectiveness of the Eighth Amendment is conditioned upon the Company pricing a bond offering in an aggregate principal amount of no less than $275 million and certain other conditions, including making arrangements so that, immediately after giving effect to the funding of any loans under the New Revolving Credit Facility Tranche, proceeds of such bond issuance are applied to repay certain revolving loans and permanently terminate certain revolving commitments, required under the Credit Agreement. A full-text copy of the 8th Amendment is available for free at http://is.gd/02JRV8 About Walter Energy Walter Energy is a leading, publicly traded "pure-play" metallurgical coal producer for the global steel industry with strategic access to high-growth steel markets in Asia, South America and Europe. The Company also produces thermal coal, anthracite, metallurgical coke and coal bed methane gas. Walter Energy employs approximately 2,900 employees with operations in the United States, Canada and United Kingdom. The Company's balance sheet at March 31, 2014, showed $5.64 billion in total assets, $4.97 billion in total liabilities and $669.6 million in total stockholders' equity. * * * As reported by the TCR on July 1, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating on Birmingham, Ala.- based Walter Energy Inc. to 'CCC+' from 'B-'. S&P believes the company's capital structure is likely unsustainable in the long- term absent an improvement in met coal prices. The TCR reported on July 10, 2014, that Moody's downgraded the Corporate Family Rating of Walter Energy, Inc., to Caa2 from Caa1. WALTER ENERGY: Bank Debt Trades at 4.05% Off -------------------------------------------- Participations in a syndicated loan under which Walter Energy Inc is a borrower traded in the secondary market at 95.95 cents-on- the-dollar during the week ended Friday, July 11, 2013 according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents a decrease of 0.46 percentage points from the previous week, The Journal relates. Walter Energy Inc pays 300 basis points above LIBOR to borrow under the facility. The bank loan matures on March 14, 2018. The bank debt carries Moody's B2 rating and Standard & Poor's B+ rating. The loan is one of the biggest gainers and losers among 249 widely quoted syndicated loans with five or more bids in secondary trading for the week ended Friday. WARTBURG COLLEGE: Fitch Rates Revenue Bonds Series 2014 'BB' ------------------------------------------------------------ Fitch Ratings has assigned a 'BB' rating on approximately $83.4 million private college revenue refunding bonds, series 2014 issued by the Iowa Higher Education Loan Authority on behalf of Wartburg College (Wartburg or the college). The fixed rate series 2014 bonds (the bonds) are expected to sell via negotiation the week of July 28, 2014. Proceeds of the bonds will be used to current refund all of the outstanding series 2005A and series 2005B bonds, and to pay costs of issuance. At the same time, Fitch affirms the rating on the outstanding series 2005A bonds. The Rating Outlook is Stable. Security The series 2014 private college facility revenue bonds are a general obligation of the college, secured by a lien on revenues of the college and a mortgage on the core campus, including the wellness center which was the prime security for the series 2005B bonds. Additionally, the bonds are supported by a debt service reserve fund equal to maximum annual debt service (MADS). Key Rating Drivers Financial Profile Improving: Wartburg's 'BB' rating reflects continuous operating margin improvement, although margins remain negative as calculated by Fitch; relative stability in the unrestricted liquidity cushion; and no new debt plans alleviate some concern over the college's high debt burden. Declining Enrollment Trend: Wartburg has experienced two consecutive years of a reduction in full-time equivalent (FTE) counts. Management has ramped up recruitment efforts which reflect an increase in year-over-year applications, admits and deposits for fall 2014 to date (at July 1, 2014). Financial Flexibility Limited: Wartburg is dependent on a high level of student fees to support operations. This critical reliance on student related revenue is exacerbated by a nearly 50% discount rate. Rating Sensitivities Operating Performance, Resource Deterioration: The rating is sensitive to shifts in enrollment and resultant impacts to operating performance. Wartburg's inability to sustain and build on vastly improved margins over the past four years and stabilize headcount could negatively pressure the rating. Conversely, enrollment growth and continued improvement in operating margins driving resource growth may yield positive rating momentum. Credit Profile Wartburg College, established in 1852 as a liberal arts college of the Evangelical Lutheran church, is located in Waverly, IA and serves predominantly in-state undergraduate students. Operating Margins Continue To Improve Wartburg's operating margin, calculated by Fitch to exclude any non-operating income except for scheduled annual endowment support, improved in fiscal 2013 but still remained negative (1.8%). Fiscal 2014 is expected to be supported by growth in gifts and contributions, which increased by about $1 million for fiscals 2012 and 2013. Although enrollment declined for the school year 2012-2013, Wartburg's focus on maximizing net yield per student and curbing expense growth assisted in producing margin improvement. The audited financial statements for the fiscal year ending May 31, 2014 are not yet completed. Previously Fitch noted an expectation of Wartburg generating a break-even operating margin by fiscal 2014 on a full accrual basis, as calculated by Fitch to include the endowment draw and depreciation expense, but exclude realized and unrealized gains. According to management, operating results are expected to remain positive on a cash-flow basis; however, break-even results are not expected for fiscal 2014 on a full accrual basis. Although management expects to achieve their targets for the year, Fitch is unable to assess the progress as Wartburg does not typically produce interim statements. Operational budget information provided to Fitch at fiscal year- end 2014 is balanced on a budgetary basis. Declining Enrollment Fitch remains concerned that there is a downward trend in both FTE and headcount but expects to see enrollment stabilization in the near term, the lack of which could affect the ratings level in the future. Preliminary budgeted enrollment as of the May board meeting assumed flat enrollment in fall 2014, which was 1,680 FTE students in the fall of 2013. Current, projected enrollment for new students is anticipated to be similar or better for the fall of 2014 according to management. The fiscal 2015 budget was built on 510 incoming students, and the college is on track for about 520 incoming students. The college's admissions profile is also ahead of last year. At this point in time last year, the college received 2,373 applications, admitted 1,794 students, and received 475 net deposits versus this year. The college has received 2,413 applications, admitted 1,862 students and received 494 net deposits to date. Wartburg is also running .3% lower in summer melt this year than last. Negative enrollment growth in fall of 2014 would most likely pressure the rating, however, Wartburg's ability to consistently improve margins despite enrollment loss is viewed favorably. Positively, the college typically updates the operating budget in the fall, after actual fall enrollment is certain. Management believes they have built in enough flexibility in the budget process to handle any slight variations in enrollment and financial aid. Limited Revenue Flexibility and High Tuition Discounting Wartburg's revenues are predominantly sourced from student related tuition, fees and auxiliary services. These funds comprise a high portion of fiscal 2013 operating revenues. Wartburg remains dependent upon enrollment growth, and the college's practice of regularly implementing increases in tuition and fees is tempered by a high tuition discounting rate of 49.8% for fiscal 2013, compared to other 'BB' category credits rated by Fitch. According to management, student financial aid awards are expected to be similar to what was budgeted in fall 2014; however, a flat to slightly higher discounting rate than the prior year is expected. Favorably, the college focuses on growth in the average net tuition per student which is expected to grow in fiscal 2015, along with overall net tuition. Fitch notes that the confluence of high revenue concentration within student fees and charges along with high discounting has not detracted from Wartburg's year-over-year margin improvement. The college is expected to continue to have a relatively high discount rate compared to other private colleges and universities similarly rated by Fitch. Fiscal 2013 Liquidity Improved Balance sheet resources increased in FY13 as a result of investment returns and gifts and contributions. Cash and investments totaled $71.6 million in fiscal 2013, up from about $61 million in the prior year. Consequently, available funds, defined as unrestricted cash and investments increased to $31.8 million in fiscal 2013 from $24 million in fiscal 2012. Wartburg's available funds offer improvement in cushion and benefitted from a stronger return in FY13. These funds covered 61.8% of operating expenditures and 38.5% of long-term debt. The alternative investment allocation for Wartburg is approximately 23%, essentially the same as the previous year. Management reported that the endowment returned 11% fiscal year- to-date, increasing the pooled endowment market value as of May 31, 2014 to $56.6 million (unaudited), compared to $52.4 million over the prior year. Wartburg's reliance upon enrollment-related revenues necessitates maintenance of the liquidity cushion at or above current levels to manage potential demand volatility. As of May 2014, the College has raised $44 mm, or 60% of its $75 million goal under its comprehensive capital campaign, and intends to enter the public phase of the campaign in Fall of 2014. Fitch will continue to monitor the college's progress towards this goal. After the refunding, Wartburg's long-term debt of $83.6 million yields a high pro-forma MADS burden of 12.4%. Offsetting the debt burden magnitude to some degree is the college's ability to adequately cover debt service from operations. Coverage of pro forma MADS is 1.19x based on fiscal 2013 unrestricted operating revenues, as calculated by Fitch. The series 2014 debt is structured with ascending pro-forma MADS occurring in fiscal 2037. Pro-forma average annual debt service (AADS) coverage based on fiscal 2013 operations is stronger at 1.32x. The college's debt burden is expected to decline over time due to normal amortization and the lack of any new debt plans. WEX INC: Moody's Affirms Ba3 Corp. Family Rating & Debt Rating -------------------------------------------------------------- Moody's Investors Service affirmed WEX Inc's Ba3 Corporate Family Rating ("CFR") and Ba3 senior unsecured debt rating. The outlook was changed to negative from stable. Ratings Rationale The change in outlook reflects the projected increase in leverage, integration risks, and decreased liquidity as a result of the company's planned acquisitions of Evolution1 and ExxonMobil's European Commercial Fuel Card Program. The Evolution1 acquisition is expected to close in Q3 and the ExxonMobil Fuel Card Program later this year. As a result of the debt financed acquisitions, the company's financial leverage will materially increase and its financial flexibility will decline. Upon completion of both acquisitions, it is expected that leverage will materially increase with corporate debt to company-reported bank covenant EBITDA increasing to well above 3.0x from approximately 2.0x currently. Both acquisitions are being financing largely by utilizing the company's $700 million, currently undrawn, bank credit facility. While it was known that the company intended to use the bank credit facility to finance future acquisitions, drawing upon the facility will result in a material reduction in the company's back-up liquidity. Furthermore, the bank facility restricts the leverage that the company can incur. While the company expects to be in full compliance with all bank covenants, the cushion between reported and contractual covenant restrictions will be materially less. WEX's ratings reflect the company's leading market position in its core fleet payment solutions business, and the business' attractive and fairly stable operating margins which have driven strong consolidated profitability for the company. The CFR also reflects WEX's strong and stable asset quality metrics related to its charge card receivables, which comprise approximately 73% of the company's tangible asset base. Balancing these positive factors are a number of credit challenges, including WEX's dependence on its regulated bank subsidiary, WEX Bank, for the vast majority of its earnings and cash flow (in the form of service fees and dividends) along with its exposure to commodity price fluctuations (gas and diesel fuel). Moreover, the company's capital position is weak due to its negative tangible equity position. Collateral for the company's senior secured credit facility consists solely of 65% of the stock of a single international subsidiary with net tangible assets of approximately $40 million. Given the foreign stock pledge nature of the collateral, and its modest value, Moody's consider the senior unsecured notes and the senior secured credit facility as a single class of debt, and as such Moody's do not differentiate between the Corporate Family Rating and the rating on the senior unsecured notes. The outlook could return to stable once company-reported bank covenant debt/EBITDA declines below 2.75x with an expectation of remaining below 2.5x, the new acquisitions are successfully integrated, the company's liquidity reaches and is expected to remain above $350 million, and the company has at least a 25% cushion in its financial covenants. The ratings could be downgraded in the event that company-reported bank covenant debt/EBITDA increases above 3.5x and is expected to remain at such level for three or more quarters or if company- reported bank covenant debt/EBITDA rises above 4.0x. A weakening of profitability whereby net income assets fell below 2.0% or declining asset quality with charge-offs rising above 0.50% would also put downward pressure on the ratings. Based in South Portland, Maine, WEX is a provider of business to business physical, digital and virtual card payment solutions. The principal methodology used in this rating was Finance Company Global Rating Methodology published in March 2012. WILLBROS GROUP: Moody's Changes B3 Rating Outlook to Positive ------------------------------------------------------------- Moody's Investors Service changed Willbros Group, Inc.'s (Willbros) outlook to positive from stable and affirmed the B3 corporate family rating, B3-PD probability of default rating, Caa1 term loan B rating and SGL-3 speculative grade liquidity rating. At the same time, Moody's affirmed the Willbros United States Holdings Inc.'s asset-based lending facility rating of B1. The change in outlook reflects the recent improvement in credit metrics driven by better operating results and the use of proceeds from asset sales to retire debt. Outlook Actions: Issuer: Willbros Group, Inc. Outlook, Changed to Positive from Stable Affirmations: Issuer: Willbros Group, Inc. Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD $250 Term Loan B, Affirmed Caa1 (LGD5, 71%) Speculative Grade Liquidity Rating, Affirmed SGL-3 Issuer: Willbros United States Holdings Inc. $150 Million Asset-Based Lending Facility, Affirmed B1 (LGD2, 29%) Ratings Rationale Willbros' B3 corporate family rating reflects its small size, weak but improving margins, relatively low short-term backlog, exposure to highly competitive and cyclical end markets and track record of inconsistent project execution. The company has historically struggled to generate consistent profitability and has produced very weak EBITDA margins due to the competitive nature of the engineering and construction industry, periodic execution and productivity issues and its inability to effectively execute its growth strategy. As a result, the company's EBITDA margins have ranged from 3.7% to 5.8% over the past four years. Willbros rating benefits from its segment diversity and its exposure to the oil and gas and power end markets, which have favorable long-term prospects. In addition, the company's operating results have improved significantly over the past few quarters and it has completed the sale of a few non-core assets and utilized the proceeds to retire debt. This has enabled the company to reduce its adjusted leverage ratio to about 3.6x, which is low for its rating. Moody's expects the company to produce significantly improved operating results in 2014 as losses in the Oil & Gas segment are significantly reduced as it shrinks the footprint of its field offices and works on its backlog of pipeline projects. Willbros should also benefit from improved results in its Canada segment as it benefits from a new management team and share gains and in its Professional Services segment from improved demand for its engineering and design, project management, line locating and pipeline integrity services. This should result in the company producing adjusted EBITDA of about $135 million in 2014 versus $118 million last year. Operating results are likely to be more stable in 2015 unless the company's order bookings pick up over the next few quarters, since Willbros backlog has remained relatively flat at about $2 billion over the past year. Willbros recently completed the sale of two non-core operations including its Hawkeye business for $21 million and its union refinery turnaround maintenance operation for $25 million. The sale of assets along with improved operating results should enable Willbros to fund the $36.5 million WAPCo legal settlement and still modestly reduce term loan debt this year. This should result in Willbros' credit metrics improving significantly, with its debt/EBITDA declining to about 3.5x from 4.1x in December 2013, and its EBITA/interest expense rising to about 2.0x from 1.4x. Therefore, the company will continue to have a moderate amount of leverage and ample interest coverage for its rating category. Willbros had $125 million of liquidity on March 31, 2014 consisting of about $54 million in cash and $71 million of borrowing availability. Willbros is expected to maintain adequate liquidity over the next 12 to 18 months as it utilizes the proceeds from asset sales and free cash flow to fund the remaining $36.5 million WAPCo legal settlement and modestly reduce its term loan debt. Willbros positive outlook reflects its recently improved credit metrics and operating results and expectations for continued improvements over the remainder of 2014. Willbros ratings could experience upward pressure should the company grow its backlog of orders and sustain adjusted leverage below 4.5x and interest coverage above 2.0x. Downward rating pressure could develop if Willbros sustained its adjusted leverage above 5.5x or its interest coverage below 1.0x. Downward rating action could also occur if its margins deteriorate substantially, its liquidity is significantly reduced or the company does not maintain compliance with its bank covenants. The principal methodology used in this rating was Global Construction Methodology published in November 2010. Willbros Group, Inc, headquartered in Houston, Texas, provides engineering and construction (E&C) services to the oil, gas and power industries primarily in North America. Willbros reports its results in four segments: Oil & Gas (40% of revenues; 20% of backlog) is focused on the US market and specializes in pipelines and associated facilities and provides maintenance and turnaround services for refineries; Utility T&D (21%; 52%) provides end-to- end infrastructure construction services, primarily for the electric and natural gas utility end-markets; Canada (22%; 15%) provides E&C services to the oil sands industry; and Professional Services (17%; 13%) provides engineering and design, project management, line locating and pipeline integrity services. Willbros' revenue for the 12 months ended March 31, 2014 was $2.1 billion and its backlog totaled $1.9 billion, of which $1.1 billion was expected to be realized over the next twelve months. Approximately 85% of Willbros' backlog is in the US and 15% in Canada. YRC WORLDWIDE: William Davidson Appointed as Director ----------------------------------------------------- The Board of Directors of YRC Worldwide Inc. approved the appointment of William R. Davidson as director of YRC Worldwide Inc. on July 8, 2014. Pursuant to its director appointment rights as the holder of the Company's Series A Voting Preferred Stock, par value $1.00 per share, the International Brotherhood of Teamsters selected William R. Davidson as one of the IBT director representatives. The Company and Mr. Davidson will enter into the Company's standard form of indemnification agreement for directors and officers. The Board of Directors has not yet determined the committees of the Board to which Mr. Davidson will be named. Mr. Davidson will receive cash and equity compensation under the same Director Compensation Plan as the other non-employee directors. Pursuant to the Plan, he will receive an annual cash retainer of $75,000, paid quarterly. In addition, Mr. Davidson will receive a grant of restricted stock units equal to $100,000 divided by the 30-day average closing price of the Company's common stock on the grant date, which grant date will be the first business day following the date of each annual meeting of stockholders, payable in advance for the ensuing Board term. Further, Mr. Davidson will receive an Annual RSU Grant for the 2014-2015 Board term. About YRC Worldwide Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ: YRCW) -- http://www.yrcw.com/-- is a holding company that offers its customers a wide range of transportation services. These services include global, national and regional transportation as well as logistics. The Company incurred a net loss of $83.6 million in 2013 following a net loss of $136.5 million in 2012. As of Dec. 31, 2013, the Company had $2.06 billion in total assets, $2.66 billion in total liabilities and a $597.4 million total shareholders' deficit. * * * As reported by the TCR on Feb. 18, 2014, Moody's Investors Service had upgraded the Corporate Family Rating for YRC Worldwide Inc. ("YRCW") from Caa3 to B3, following the successful closing of its refinancing transactions. In the Jan. 31, 2014, edition of the TCR, Standard & Poor's Ratings Services said that it raised its ratings on Overland Park, Kansas-based less-than-truckload (LTL) trucker YRC Worldwide Inc. (YRCW), including the corporate credit rating to 'CCC+' from 'CCC', and removed them from CreditWatch negative, where they were placed on Jan. 10, 2014. "The upgrades reflect YRCW's improved liquidity position and minimal debt maturities as a result of its proposed refinancing," said Standard & Poor's credit analyst Anita Ogbara. * Elite Law Firms Dominate as Deals Proliferate ----------------------------------------------- Liz Hoffman and Jennifer Smith, writing for The Wall Street Journal, reported that this year's megadeal-driven boom in mergers and acquisitions has largely benefited a small group of elite law firms. According to the report, citing Dealogic, the top five law firms, ranked by deal dollar values, had more than 75% of the market in the first half, the highest level in five years. Skadden, Arps, Slate, Meagher & Flom LLP was atop the heap, with a hand in one of every five dollars committed to M&A -- the highest market share captured by any law firm in 10 years, the report related. Simpson Thacher & Bartlett LLP was the second-place firm by deal value, according to Dealogic, while Davis Polk & Wardwell LLP was in fourth place and Cleary Gottlieb Steen & Hamilton LLP, fifth, the Journal said. * BOND PRICING: For Week From July 7 to 11, 2014 ------------------------------------------------ Company Ticker Coupon Bid Price Maturity Date ------- ------ ------ --------- ------------- Alion Science & Technology Corp ALISCI 10.250 73.053 2/1/2015 Allen Systems Group Inc ALLSYS 10.500 50.875 11/15/2016 Allen Systems Group Inc ALLSYS 10.500 52.500 11/15/2016 Brookstone Co Inc BKST 13.000 38.250 10/15/2014 Brookstone Co Inc BKST 13.000 45.000 10/15/2014 Brookstone Co Inc BKST 13.000 38.125 10/15/2014 Buffalo Thunder Development Authority BUFLO 9.375 41.500 12/15/2014 Caesars Entertainment Operating Co Inc CZR 10.000 36.625 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10.750 68.196 2/1/2016 Caesars Entertainment Operating Co Inc CZR 12.750 42.218 4/15/2018 Caesars Entertainment Operating Co Inc CZR 10.000 40.133 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10.000 36.500 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10.000 41.000 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10.000 41.000 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10.000 36.500 12/15/2018 Champion Enterprises Inc CHB 2.750 0.250 11/1/2037 Endeavour International Corp END 5.500 47.500 7/15/2016 Energy Conversion Devices Inc ENER 3.000 0.125 6/15/2013 Energy Future Competitive Holdings Co LLC TXU 8.175 1.300 1/30/2037 Energy Future Holdings Corp TXU 5.550 51.000 11/15/2014 FairPoint Communications Inc/Old FRP 13.125 1.000 4/2/2018 Global Geophysical Services Inc GGS 10.500 48.250 5/1/2017 Global Geophysical Services Inc GGS 10.500 34.875 5/1/2017 HP Enterprise Services LLC HPQ 3.875 95.000 7/15/2023 James River Coal Co JRCC 7.875 12.500 4/1/2019 James River Coal Co JRCC 4.500 3.000 12/1/2015 James River Coal Co JRCC 10.000 9.875 6/1/2018 James River Coal Co JRCC 10.000 11.000 6/1/2018 James River Coal Co JRCC 3.125 2.750 3/15/2018 LBI Media Inc LBIMED 8.500 30.000 8/1/2017 Las Vegas Monorail Co LASVMC 5.500 10.000 7/15/2019 Lehman Brothers Inc LEH 7.500 12.625 8/1/2026 MF Global Holdings Ltd MF 6.250 46.000 8/8/2016 MF Global Holdings Ltd MF 1.875 46.000 2/1/2016 MModal Inc MODL 10.750 10.375 8/15/2020 MModal Inc MODL 10.750 10.125 8/15/2020 Momentive Performance Materials Inc MOMENT 11.500 31.000 12/1/2016 Motors Liquidation Co MTLQQ 7.200 11.250 1/15/2011 Motors Liquidation Co MTLQQ 7.375 11.250 5/23/2048 Motors Liquidation Co MTLQQ 6.750 11.250 5/1/2028 NII Capital Corp NIHD 10.000 29.625 8/15/2016 OnCure Holdings Inc RTSX 11.750 48.875 5/15/2017 Platinum Energy Solutions Inc PLATEN 14.250 74.750 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.250 74.750 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.250 74.750 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.250 74.750 3/1/2015 Powerwave Technologies Inc PWAV 1.875 0.125 11/15/2024 Powerwave Technologies Inc PWAV 1.875 0.125 11/15/2024 Pulse Electronics Corp PULS 7.000 74.945 12/15/2014 TMST Inc THMR 8.000 16.250 5/15/2013 Terrestar Networks Inc TSTR 6.500 10.000 6/15/2014 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 15.000 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 15.250 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.500 12.000 11/1/2016 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 14.875 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.500 14.625 11/1/2016 Tunica-Biloxi Gaming Authority PAGON 9.000 60.750 11/15/2015 USEC Inc USU 3.000 33.405 10/1/2014 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.375 53.000 8/1/2016 WCI Finance LLC / WEA Finance LLC WDCAU 5.700 112.633 10/1/2016 WEA Finance LLC / WT Finance Aust Pty Ltd WDCAU 6.750 121.900 9/2/2019 WEA Finance LLC / WT Finance Aust Pty Ltd WDCAU 6.750 121.513 9/2/2019 Western Express Inc WSTEXP 12.500 82.250 4/15/2015 Western Express Inc WSTEXP 12.500 82.000 4/15/2015 ********* 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 ***