/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140716.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, July 16, 2014, Vol. 18, No. 196 Headlines 126 LLC: Court Pegs Value of Collateral for Newark's Secured Lien 21ST CENTURY ONCOLOGY: S&P Revises Ratings Outlook to Negative ABERCROMBIE & FITCH: Moody's Assigns B1 CFR, Rates $325MM Loan B1 ABERCROMBIE & FITCH: S&P Assigns BB- CFR & Rates $325MM Debt BB- AGFEED USA: Wants Escrow Agent to Release Sale Closing Payments ALGO INC: Case Summary & 5 Unsecured Creditors ALLONHILL LLC: Seeks More Time to Decide on Leases ALLONHILL LLC: Court Authorizes Hiring of W&C as Appellate Counsel ALLONHILL LLC: Can Tap Haddon as Special Appellate Counsel ALLONHILL LLC: Can Hire EKS&H as Tax Accountant, Auditor ALLY FINANCIAL: Moody's Affirms Ba3 CFR & B1 Sr. Unsecured Rating AMERICAN APPAREL: Arbitration Clauses Let Retailer Hide Misconduct ARTURO J. GONZALEZ: Voluntary Chapter 11 Case Summary ASHLEY STEWART: Plan Exclusivity Period Extended Until Nov. 4 ASTON ESCROW: S&P Assigns 'B' CCR & Rates $440MM Secured Notes 'B' ATLS ACQUISITION: Has Until Aug. 30 to Decide on Unexpired Leases BAPTIST HOME: Has Aug. 15 Auction of Assets BANESCO USA: Fitch Affirms 'B+' Long-term Issuer Default Rating BERNARD L. MADOFF: Ruling Blocks Risky Expansion Of Bankruptcy Law BRINX RESOURCES: Reports $109K Net Loss in April 30 Quarter BRITISH AMERICAN: Fraudulent Transfer Claims Kept Alive In RE Suit BURCON NUTRASCIENCE: PwC LLP Raises Going Concern Doubt CABEL PROPERTIES: Files List of 20 Largest Unsecured Creditors CABEL PROPERTIES: Files Schedules of Assets and Liabilities CABEL PROPERTIES: Seeks to Assume 2009 Purchase Agreement CARDTRONICS INC: S&P Affirms 'BB+' Corp. Credit Rating CHARLOTTE RUSSE: S&P Revises Outlook to Pos. on Stock Redemption CHINA NATURAL: Alan Nisselon Named Interim Trustee CLEAREDGE POWER: Signs Doosan to $48 Million Contract COASTLINE INVESTMENTS: Can Hire CBRE as Real Estate Broker COLDWATER CREEK: Hearing Thurs. on Sale of Property Leases COLONIAL BANK: Citi Says High Court Ruling Dooms $388M MBS Suit COMMUNITY MEMORIAL: Seeks Approval to Sell Cheboygan Property COMMUNITY MEMORIAL: Gets Approval to Settle Dispute With PHSI CORINTHIAN COLLEGES: Takedown Signals Tougher Agency Enforcement D.A.B. GROUP: Stalled Allen Street Hotel in NY Files for Ch. 11 D.A.B. GROUP: Files Schedules of Assets and Liabilities DETROIT, MI: Mayor Mike Duggan's Pledges Echo in City's North End DIAMOND TECHNOLOGY: Posts $154K Net Loss in April 30 Quarter DIVERSIFIED RESOURCES: Posts $406K Net Loss in April 30 Quarter ENERGY FUTURE: Wants Separate 401(k) Plan for Oncor Employees EXIDE TECHNOLOGIES: Seeks $65M In Additional Bankruptcy Financing F&H ACQUISITION: Has Until August 13 to Decide on Leases FLETCHER INT'L: Bid to Disgorge and Compel Compliance Denied FONTAINEBLEAU LAS VEGAS: Trustee Strikes $83.3M Deal for Creditors FREE LANCE-STAR: DSP Seeks to Disband Committee FREE LANCE-STAR: Wants Case Caption Changed to "VA NEWSPAPER" GABRIEL TECHNOLOGIES: Court OKs Case Conversion to Chapter 7 GBG RANCH: Files Notice to Remove State Court Suit GENERAL MOTORS: Top Lawyer Faces Scrutiny on Defect, Settlements GLOBAL GEOPHYSICAL: Approved to Pay or Advance Defense Cost GLOBAL GEOPHYSICAL: July 22 Hearing on Cardno Entrix Agreement GLOBAL GEOPHYSICAL: July 22 Hearing on Bid to Pay Colombian Taxes GLOBAL GEOPHYSICAL: Needs 60 Days to Propose a Plan GOLDKING HOLDINGS: Scheduled for Aug. 18 Confirmation Hearing HANESBRANDS INC: Moody's Affirms 'Ba1' Corporate Family Rating HANESBRANDS INC: S&P Retains 'BB' Corp. Credit Rating HDGM ADVISORY: Judge Adjourns Motion to Convert Case Indefinitely HDGM ADVISORY: Hearing on Trustee Motion Adjourned Indefinitely HEARING HELP EXPRESS: Case Summary & 20 Top Unsecured Creditors HERITAGE PLACE: Case Summary & 20 Largest Unsecured Creditors HG SPEC: Chapter 15 Case Summary HOYT TRANSPORTATION: Plan Filing Exclusivity Extended to Aug. 12 IDAHO BANCORP: D.L. Evans Wins at Auction KILROY REALTY: Moody's Affirms 'Ba1' Preferred Stock Rating LEHMAN BROTHERS: Protocol to Resolve Indemnification Claims Okayed LEHMAN BROTHERS: July 31 Deadline for LB UK Creditors' Debt Proofs LEHMAN BROTHERS: LBEL Creditors July 24 Deadline to Prove Claims LEHMAN BROTHERS: Workers' ESOP Suit Revived in Supreme Court LILY GROUP: Bid to Substantially Consolidate Cases Denied LOVE CULTURE: Retailer Planning New Jersey Filing LTHM HOUSTON: Case Summary & 20 Top Unsecured Creditors M. A. NEGM: Case Summary & 15 Unsecured Creditors MCGRAW-HILL GLOBAL: Moody's Hikes 1st Lien Debt Rating to B1 MCGRAW-HILL GLOBAL: S&P Affirms 'B+' Rating on 1st Lien Debt MEMORIAL PRODUCTION: Moody's Rates $500MM Unsecured Notes 'Caa1' MEMORIAL PRODUCTION: S&P Cuts Sr. Unsecured Notes Rating to 'CCC+' MF GLOBAL: UK Unit OK'd to Pay Clients After Key Settlement MOBILEBITS HOLDINGS: Has $2.91-Mil. Net Loss in April 30 Quarter MOMENTIVE PERFORMANCE: Bridge Facility Letter Approval Sought MORNINGSTAR MARKETPLACE: Claims Bar Date Set for July 21 NAKED BRAND: Reports $1.23-Mil. Net Loss in April 30 Quarter NATIONAL CINEMEDIA: Moody's Rates $135MM Credit Facility 'Ba2' NEW ENGLAND COMPOUNDING: Patients Sue NJ Hospital Over Outbreak OCZ TECHNOLOGY: Confident About Approval of 'Consensual' Plan OMEGA HEALTHCARE: Fitch Affirms 'BB+' Subordinated Debt Rating PETROLOGISTICS LP: Moody's Places B1 CFR on Review for Upgrade PF CHANG'S: S&P Affirms 'B-' CCR on Lower Business Risk POINT BLANK: Asks Court to Extend Deadline to Remove Suits QUIKSILVER INC: S&P Affirms 'B-' CCR & Revises Outlook to Neg. REALBIZ MEDIA: Has $869K Net Loss in April 30 Quarter REX ENERGY: Moody's Rates $250MM Sr. Unsecured Notes 'B3' REX ENERGY: S&P Assigns 'B-' Rating on $250MM Unsecured Notes RIOFORTE INVESTMENTS: To File for Creditor Protection SOURCE INTERLINK: July 21 Hearing on Bid to Sell Retail Business SOURCE INTERLINK: Meeting of Creditors Scheduled for July 22 SP HOLDCO I: Moody's Assigns B3 Corp. Family Rating; Outlook Neg. SCSJ ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors SIGNAL ELECTRIC: Default Judgment in "Ha" Suit Vacated TACTICAL INTERMEDIATE: Unsecured Creditors May Receive Nothing TACTICAL INTERMEDIATE: Has Interim Approval of $2.8MM DIP Loan TACTICAL INTERMEDIATE: Has Interim OK to Pay Critical Vendors TACTICAL INTERMEDIATE: Can Employ Prime Clerk as Claims Agent TACTICAL INTERMEDIATE: Court Issues Joint Administration Order TELEPHONE AND DATA: Fitch Cuts Issuer Default Ratings to 'BB+' TEM ENTERPRISES: Court Approves Cash Collateral Use for 60 Days TEM ENTERPRISES: Files List of 20 Largest Unsecured Creditors TEM ENTERPRISES: Files Schedules of Assets and Liabilities TEM ENTERPRISES: July 23 Hearing on Bid to Assume Accountemps Deal TLO LLC: Wants to Distribute $35-Mil. to Tech Inc. TLO LLC: Oversight Committee Hires GlassRatner as Fin'l Advisor TLO LLC: Withdraws Bid to Amend Employment of Ver Ploeg TLO LLC: Oversight Panel Taps Genovese Joblove as Counsel TRIPLANET PARTNERS: Robinson Brog Approved as General Counsel TRIPLANET PARTNERS: Joshua Rizack Approved as CRO U.S. COAL: Consents to Being in Chapter 11 USS PARENT: Moody's Assigns 'B2' CFR & 'B1' Senior Secured Rating VAIL LAKE: Plan Exclusivity Period Extended to Aug. 1 VIVARO CORP: Aug. 25 Transition Period Claims Bar Date Proposed VIVARO CORP: To Execute Partial Lien Release Against Purchaser WHEATLAND MARKETPLACE: U.S. Bank Balks at Cash Access Beyond July WHITING PETROLEUM: Moody's Puts 'Ba2' CFR On Review for Upgrade WINDSOR PETROLEUM: Files Ch. 11 to Implement Debt-To-Equity Swap XUMANII INTERNATIONAL: Has $1.06-Mil. Net Loss in April 30 Quarter YARWAY CORP: Seeks Extension of Time to Remove Lawsuits YELLOWSTONE MOUNTAIN: Blixseth Hit With $220MM Judgment by Trustee YUCCA GROUP: Submits Post-Confirmation Status Report * Disbarred Atty Accused Of Diverting Firm's Clients, Cash * Social Security Not Considered in Conversion from '7' to '13' * AIG, Pru's Living Wills Won't Cure All in Case of Collapse * Immigrants Squeezed as Banks Curtail Int'l Money Transfers * 4 Attorneys Join Schnader, Bolstering Firm's Real Estate Group * London Partner Elected Global Chair Of Latham & Watkins ********* 126 LLC: Court Pegs Value of Collateral for Newark's Secured Lien ----------------------------------------------------------------- Bankruptcy Judge Donald H. Steckroth, at a hearing on July 8, 2014, was asked by debtor 126 LLC to fix the fair market value of its real property located at 126 Passaic Street, Newark, New Jersey. The property was the subject of an auction sale and subsequent hearing before the Court approving that sale on May 5, 2014. The sale of the Property was conducted under Section 363 of the Bankruptcy Code, and was offered free and clear of liens, valid liens to attach to the proceeds of sale. The Property was sold at public auction with competitive bidding after extensive marketing by an experienced mortgage broker. Meadowlands Ventures LLC submitted the highest and best offer. The price at the auction sale was $1,600,000 subject to the Debtor's credit or give-back to the purchaser of $250,000 for site remediation and, most significantly, the purchase was conditioned upon environmental insurance proceeds in the sum of at least $1,100,000 being available for site remediation. Thus, with the sale price of $1,600,000, less credits to the purchaser of $250,000 and $1,125,000, already placed in an environmental trust, $225,000 represents the market value of the Property. Thus, this is the value of the collateral for the secured portion of the City's claim. The balance of the City's claim shall be treated as an unsecured general claim. The purpose of the July 8 Hearing concerned determination of the value of the Property and thus, in essence, sought to fix the secured amount of the lien asserted by the City of Newark in the sum of almost $1,400,000, roughly one half of which is for unpaid real estate taxes with the balance for water and sewer rents. The Debtor originally filed a motion seeking to disallow portions of the City's claim, but after conferences and adjournment of the original application, the Hearing morphed into one regarding the value of the Property so that, pursuant to Section 506(a) of the Bankruptcy Code, the value of the collateral may be determined to fix the City's secured portion of its claim. The City objected and participated in the Hearing. The Debtor argues that the Hearing is vital to the successful liquidation of the Debtor's assets, a proposed settlement with W.A.S. Terminals Corp., and the successful remediation of the Property. The Debtor had commenced an adversary proceeding against W.A.S. seeking to determine the extent of W.A.S.'s lien, to which W.A.S. filed various counterclaims against the Debtor. After extensive litigation, the dispute has been settled with the parties agreeing to settle all claims. As part of the Settlement, the parties agreed that upon closing of title and any sale of the Property, the Debtor would release its insurance proceeds to the buyer in order to complete environmental remediation of the Property, as required by the New Jersey Department of Environmental Protection and other governmental agencies. The City offered no testimony as to the value of the Property, which is its collateral for its lien. It did object at the Hearing, asserting that, in its view, the best test of value would be an independent appraisal of the Property, although the City did not offer such an appraisal. The Court disagrees with that contention and finds that a fair valuation must be analyzed in light of the marketplace and assumes a willing buyer and a willing seller. According to the Court, with competitive bidding after extensive advertising, the Auction sale constituted a market sufficient to establish fair value for the Property. In a July 14, 2014 Opinion available at http://is.gd/LrPC8kfrom Leagle.com, Judge Steckroth held that the value of the Property is as fixed by the market at the time of the auction sale, taking into account the credits provided by the Debtor and the insurance proceeds available, all of which were conditions of the sale. Accordingly, the value of the collateral for the City's secured lien is determined to be $225,000. 126 LLC filed a voluntary petition under Chapter 7 of the Bankruptcy Code (Bankr. D.N.J. Case No. 12-35157) on October 16, 2012, which was subsequently converted to a case under Chapter 11. 21ST CENTURY ONCOLOGY: S&P Revises Ratings Outlook to Negative -------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on 21st Century Oncology Holdings Inc. to negative from stable, and affirmed the ratings, including the corporate credit rating at 'B-'. "We revised the outlook on 21st Century Oncology after CMS announced a proposed rate cut for radiation oncology," said Standard & Poor's credit analyst Tulip Lim. "About 45% of the company's U.S. net patient service revenue comes from Medicare and Medicaid. The final rate is often different from the one proposed; however, we believe the risk that even a smaller rate cut could raise discretionary cash flow deficits beyond our expectations for the rating and reduce the company's liquidity." Standard & Poor's could consider lowering the rating on 21st Century Oncology if S&P deems the company's capital structure to be unsustainable and, importantly, S&P sees meaningful risk that its liquid resources may not be able cover its near-term needs. This could occur if the company's revolving credit facility availability approaches $25 million or less and could coincide with treatment volumes declining, reimbursement decreasing, or expected margin expansion not materializing, leading to widening discretionary cash flow deficits. Alternatively, S&P could revise the outlook to stable if reimbursement remains flat or at current levels, volumes continue to increase, and the company continues to improve margins. A revision to stable would also require the company's liquidity to be adequate for near-term needs. ABERCROMBIE & FITCH: Moody's Assigns B1 CFR, Rates $325MM Loan B1 ----------------------------------------------------------------- Moody's Investors Service assigned a B1 Corporate Family Rating to Abercrombie & Fitch Management Co., an indirect operating subsidiary of Abercrombie & Fitch Co. Moody's also assigned a B1 rating to the company's proposed $325 million term loan, and an SGL-1 Speculative Grade Liquidity rating. The outlook is positive. Proceeds from the new term loan will be used to refinance the company's existing credit facilities, add approximately $125 million of cash to the balance sheet, and for general corporate purposes, including potential share repurchases. The company is also expected to establish a new $400 million ABL revolver (unrated). The ratings are subject to completion of the transaction and review of final documentation. The following ratings were assigned: Corporate Family Rating at B1 Probability of Default Rating at B1-PD $325 million secured term loan due 2021 at B1 (LGD3) Speculative Grade Liquidity Rating at SGL-1 Ratings Rationale Abercrombie's B1 Corporate Family Rating reflects its moderately- high pro forma lease-adjusted debt/EBITDAR, at about 4.25 times, compounded by its very high business risk as a niche retailer in the highly competitive teen apparel market. Revenue and earnings volatility is very high in this space due to high fashion risk and discretionary consumer spending cycles, particularly teens between the ages of 14-22 years old. Abercrombie's operating performance has been inconsistent over the past six years, and recent trends are again negative. Moody's believes is attributable to both company-specific and macroeconomic factors. Apparel spending in the company's core youth/teen demographic has remained challenged, and an elevated price point has likely not resonated well with an increasingly cost conscious consumer, particularly when considering the highly promotional environment and lower-priced alternative brands. While the company is undertaking initiatives directed at these challenges, competition will remain fierce as retailers chase a smaller percentage of the consumers wallet, likely pressuring the ability to significantly improve margins. The B1 rating also acknowledges, however, the company's sizable market presence, with revenue of about $4 billion. Abercrombie has three distinct, well-known brands and meaningful diversification across geographies and distribution channels through its growing direct-to-consumer business with significant opportunities for growth. Liquidity is very good, as reflected in the SGL-1 Speculative Grade Liquidity rating, providing significant ratings support. Balance sheet cash, which is expected on average to remain in excess of funded debt, and seasonal operating cash flow are expected to amply cover interest expense, working capital and capital expenditures. Dividends and share repurchase activity remain the likely uses of excess cash flow. The company allocated $150 million towards repurchases in the first quarter of 2014 and has remaining authorization for another 12.4 million shares. The overall liquidity position will further benefit from the establishment of the $400 million ABL revolver, providing an ample backstop to operating cash flow, and lack of financial maintenance covenants in the term loan. The B1 rating assigned to the proposed $325 million term loan reflects its second lien position on domestic accounts receivable and inventory (the $400 million asset based revolver will have a first lien on these assets), a first lien on substantially all other domestic assets and subsidiary stock, and 65% of the stock of controlled foreign subsidiaries. The rating also reflects meaningful support from junior claims in the capital structure from unsecured lease obligations. The credit facilities are guaranteed by the company's direct and indirect domestic subsidiaries. The positive outlook reflects Moody's expectation that the company will make meaningful progress in executing its strategy to return to profitable growth -- including improved U.S. store productivity, international store expansion, increased e-commerce penetration and executing on cost reduction initiatives -- but acknowledges that these initiatives are still in the early stages, and that significant execution risk remains. Ratings could be upgraded if the company sustainably improves operating performance, including a return to profitable growth, positive comparable store sales and margin expansion, while maintaining a balanced financial policy. Quantitative metrics include lease adjusted debt/EBITDA sustained at or below 4.0 times and EBITA/interest expense above 2.75 times, while maintaining a very good liquidity position. A ratings downgrade could occur if operating trends were to deteriorate further, financial policies become more aggressive, or liquidity meaningfully declines. Specific metrics include lease adjusted debt/EBITDA above 5.0 times or EBITA/Interest below 2.0 times on a sustained basis. The principal methodology used in this rating was the Global Retail Industry published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Abercrombie & Fitch Management Co. is an indirect operating subsidiary of Abercrombie & Fitch Co. Through its subsidiaries, the company operates approximately 1,000 specialty apparel stores and several e-commerce websites in North America, Europe, and the Asia Pacific regions under the "Abercrombie & Fitch", "abercrombie", and "Hollister" brands. Annualized revenues approximate $4 billion. ABERCROMBIE & FITCH: S&P Assigns BB- CFR & Rates $325MM Debt BB- ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to New Albany, Ohio-based Abercrombie & Fitch Co. The outlook is stable. "At the same time, we assigned a 'BB+' issue-level rating to the company's proposed $400 million ABL facility with a '1' recovery rating. The '1' recovery rating indicates our expectation of a very high (90%-100%) recovery in the event of payment default. We also assigned a 'BB-' issue-level rating to the company's new $325 million term loan B with a '3' recovery rating, indicating our expectation of meaningful (50%-70%) recovery in the event of a payment default," S&P said. The company will use the proceeds from the transaction to refinance a $131 million term loan and $60 million outstanding under an unsecured revolving credit facility. S&P expects the remainder of the funds to be held in cash at the close of the transaction and be used for general corporate purposes, including share repurchases, throughout the remainder of 2014. "Abercrombie participates in the competitive and widely fragmented specialty apparel industry. We view the company's highly recognizable brand that has an extensive global presence and solid business position focusing on the teen segment, as strengths," said credit analyst Kristina Koltunicki. "Challenges include its high historical volatility of profitability and continued depressed operating performance, highlighted by persistent negative same-store sales. We view Abercrombie's omni-channel initiatives and international expansion as the two primary vehicles of growth for the company, as we believe its U.S. store presence has been overbuilt and will decline over the next two years." The rating outlook on Abercrombie is stable. S&P expects revenues and margins to remain pressured for the remainder of 2014 given its view that the retail environment will continue to be competitive and highly promotional. However, S&P believes operating performance will begin to improve in the beginning of 2015 as the company gains further momentum in realizing the benefits of its strategic initiatives. Despite S&P's view for an uneven performance cadence, it still expects credit protection measures to improve some from pro forma levels. Downside Scenario S&P could lower its ratings on Abercrombie if operating performance does not show signs of rebounding in 2015 possibly as a result of merchandise missteps related to its fashion-conscience teen consumer and a persistent slowdown in U.S. mall traffic. At that point, EBITDA would erode by about 10% from forecasted levels, which would result in leverage approaching the mid-5.0x area. S&P could also lower the ratings if Abercrombie becomes more aggressive with shareholder friendly activities, including debt-financed share repurchases, resulting in the deterioration of leverage to similar levels. Upside Scenario An upgrade is not under consideration over the next year, given S&P's tempered performance expectations. S&P could consider raising its ratings over a longer time horizon, if operating performance becomes less volatile, demonstrated through more consistent EBITDA generation. An alternative scenario for an upgrade would include an improvement to credit metrics, such that debt leverage would improve to under 4.0x and FFO to debt would increase more than 20%, on a sustained basis. EBITDA would need to increase by approximately 25% from forecasted levels for this to occur. AGFEED USA: Wants Escrow Agent to Release Sale Closing Payments --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware will convene a hearing on July 28, 2014, at 11:00 a.m. to consider AgFeed Industries, Inc's motion for an order (i) enforcing the sale order in connection with AgFeed Industries, Inc. stock sale; (ii) direct U.S. Bank National Association, as escrow agent, to release the escrowed funds which represents the unpaid closing payments to AgFeed Industries, Inc. On Nov. 26, 2013, the Court authorized the sale of stock of AgFeed Industries to Good Charm International Development, Ltd., as purchaser, Ningbo Tech-Bank Co., Ltd., as parent dated Sept. 13, 2013. Pursuant to the stock purchase agreement, the purchaser agreed to buy 100% of the stock in AgFeed Industries, Inc. (British Virgin Islands). At closing, the purchaser was to pay AgFeed Industries the base purchase price, minus the cash deposit, minus the estimated adjustment as determined by AgFeed Industries. Closing of the SPA occurred on Dec. 6, 2013. According to the Debtor, one component of the estimated adjustment was AgFeed Industries' Estimated New Working Capital Amount of the Company Group as of Nov. 30, 2013. In accordance with the methodology prescribed by SPA, AgFeed Industries prepared a calculation of the estimated adjustment and submitted the calculation to the purchaser and NTB. AgFeed was entitled to additional consideration of $558,431. At the closing and despite the provisions of the SPA requiring payment of the estimated adjustment, NTB and the purchaser indicated that had not sufficient time to analyze the calculation of the estimated adjustment, and accordingly, were, unwilling to pay the amount until the time as they were able to verify the estimated amount. Despite efforts to resolve the matter, the parties have been unable to reach a final resolution. Pursuant to the escrow agreement, the escrowed funds can only be released upon a written instruction from the parties or upon Court order. About AgFeed Industries AgFeed Industries, Inc., has 21 farms and five feed mills in China producing more than 250,000 hogs annually. In the U.S., the business included 10 sow farms in three states and two feed mills producing more than one million hogs a year. AgFeed's revenue in 2012 was $244 million. AgFeed and its affiliates filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on July 15, 2013, with a deal to sell most of its subsidiaries to The Maschhoffs, LLC, for cash proceeds of $79 million, absent higher and better offers. The Debtors estimated assets of at least $100 million and debts of at least $50 million. Keith A. Maib signed the petition as chief restructuring officer. Hon. Brendan Linehan Shannon presides over the case. Donald J. Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors Inc. acts as the Debtors' financial advisor. The Debtors' claims and noticing agent is BMC Group, Inc. The U.S. Trustee has appointed a five-member official committee of unsecured creditors to the Chapter 11 cases. The Creditors' Committee tapped Lowenstein Sandler as lead bankruptcy counsel and Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as the Creditors' Committee's financial advisor. An official committee of equity security holders was also appointed to the Chapter 11 cases. The Equity Committee tapped Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf as co-counsel. In October 2013, AgFeed completed the sale of the U.S. operations to three buyers for $79.45 million, including $53.4 million in cash. In November 2013, the Court authorized AgFeed to sell its Chinese assets to Hong Kong firm Good Charm International Development Ltd. in a deal that is expected to net the debtor $45 million once several highly negotiated price adjustments are factored in. An auction was held for the Chinese facilities on Nov. 20, although no one emerged to top what was originally a $50.5 million bid. The price was lowered by $3.45 million in view of what the contract called "newly discovered" operational problems and "deterioration of the performance" of feed mills. * * * In December 2013, AgFeed filed a proposed plan of liquidation showing all creditors as being paid in full, with interest. The Plan proposes to create a trust to prosecute lawsuits and collect remaining assets. As reported by the Troubled Company Reporter on May 21, 2014, the Debtors filed their First Amended Chapter 11 Plan of Liquidation and accompanying disclosure statement. The Plan is supported by the Official Committee of Equity Security Holders. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/Agfeed_1076_DS.PDF ALGO INC: Case Summary & 5 Unsecured Creditors ---------------------------------------------- Debtor: Algo, Inc. dba Grant Realty dba Grant Development 2811 E Evergreen Blvd Vancouver, WA 98661 Case No.: 14-43837 Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Hon. Brian D Lynch Debtor's Counsel: Timothy J. Dack, Esq. TIMOTHY J. DACK 1014 Franklin Street, Suite 102 PO Box 61645 Vancouver, WA 98666 Tel: 360-694-4227 Email: bkfile@dackoffice.com Total Assets: $424,900 Total Liabilities: $4.33 million The petition was signed by Allen R. Grant, president. A list of the Debtor's five largest unsecured creditors is available for free at http://bankrupt.com/misc/wawb14-43837.pdf ALLONHILL LLC: Seeks More Time to Decide on Leases -------------------------------------------------- Allonhill LLC filed a motion with the U.S. Bankrptcy Court seeking to extend the time for the Debtor to assume or reject any leases, subleases or other agreements to which the Debtor is a party that may be considered an unexpired lease of nonresidential property for 90 additional days, through and including October 22, 2014. In the Schedules, the Debtor identified two Unexpired Leases to which it is the lessee: (i) a lease of office space located at 1515 Arapahoe in Denver, Colorado, to which Exclusive Resorts, LLC is the lessor; and (ii) a lease of office space located at 4700 South Syracuse in Denver, Colorado, to which Guardian/DDC, is the lessor. Aside from the Debtor, the only other parties to the Arapahoe Lease and the Syracuse Lease are Exclusive and Guardian, respectively. On April 30, 2014, the Arapahoe Lease terminated pursuant to its terms. The Syracuse Lease remains in effect. The 120-day period under section 365(d)(4)(A)(i) of the Bankruptcy Code within which the Debtor may assume or reject unexpired leases of nonresidential real property currently expires July 24, 2014. Pursuant to section 365(d)(4) of the Bankruptcy Code, the Debtor requests that the Assumption/Rejection Period be extended by 90 days, through and including October 22, 2014. The requested extension would be without prejudice to the rights of the Debtor to seek further extensions of the Assumption/Rejection Period pursuant to section 365(d)(4)(B)(ii). Without an extension, the Assumption/Rejection Period will expire on July 24, 2014. Following the Stewart Transaction, although the Syracuse Lease was assigned to Stewart, the Debtor remains a counterparty to the Syracuse Lease, and, despite the Debtor's best efforts, Guardian has not confirmed or accepted the lawful assignment of the Syracuse Lease to Stewart. Although the Debtor has taken concrete steps towards resolving this issue, the Debtor needs additional time to complete this process, either voluntarily or through the Court process. To prevent the expiration of the Assumption/Rejection Period before the resolution of the Syracuse Lease, the Debtor, pursuant to section 365(b)(4), and out of an abundance of caution, seeks to extend the Assumption/Rejection Period. The Debtor submits that Guardian will not suffer any harm as a result of the requested extension, because Stewart will continue to pay rent and occupy the premises in accordance with the Syracuse Lease. The extension also will afford the Debtor a meaningful opportunity to resolve with Guardian the assignment to Stewart of the Syracuse Lease. In contrast, not extending the Assumption/Rejection Period will likely force the Debtor to expend additional costs and resources to assume and assign to Stewart the Syracuse Lease, which has already been lawfully done under the Stewart APA. Any extension of the Assumption/Rejection Period will provide the Debtor with additional time to resolve with Guardian the issues relating to the previous assignment to Stewart of the Syracuse Lease. About Allonhill LLC Allonhill LLC, a professional services firm based in Denver, Colorado, that previously provided loan due diligence and credit risk management services for institutions that invest in, sell, securitize or service mortgage loans, sought protection under Chapter 11 of the Bankruptcy Code on March 26, 2014. The case is In re Allonhill, LLC, Case No. 14-bk-10663 (Bankr. D. Del.). The Debtor's General Counsel is HOGAN LOVELLS US LLP. The Debtor's Local Counsel is Neil B. Glassman, Esq., Justin R. Alberto, Esq., and Evan T. Miller, Esq., at BAYARD, P.A., in Wilmington, Delaware. Upshot Services LLC serves as the Debtor's Claims and Noticing Agent. The Debtor disclosed $19,205,062 in assets and $32,918,294 in liabilities as of the Chapter 11 filing. Roberta A. DeAngelis, U.S. Trustee for Region 3, notified the Bankruptcy Court that she was unable to appoint an official committee of unsecured creditors in the case of Allonhill, LLC. The U.S. Trustee explained that there were insufficient response to the communication/contact for service on the committee. ALLONHILL LLC: Court Authorizes Hiring of W&C as Appellate Counsel ------------------------------------------------------------------ Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware authorized Allonhill LLC to employ Williams & Connolly LLP as special appellate counsel. W&C has served as principal counsel for the Debtor in connection with the matter of Allonhill, LLC v. Aurora Bank, FSB, No. 12CV6381, District Court, City and County of Denver, Colorado, since the commencement of the litigation in 2012. The defendant in that case filed a counterclaim, and after trial the court entered a judgment in favor of the defendant in the amount of $25,845,329. The Debtor intends to file an appeal, which would be heard in the Colorado Court of Appeals. Given W&C's familiarity with the Debtor's business and the issues presented in the matter of Allonhill, LLC v. Aurora Bank, FSB, the Debtor believes that W&C is the best qualified law firm to provide the specialized legal services sought by the Debtor. As of the Petition Date, W&C was owed $984,682 by the Debtor in respect of services provided to the Debtor for which it has not been paid. W&C's services will only encompass the following specified purposes: (a) advise the Debtor in connection with the legal aspects of the appeal; (b) prepare on behalf of the Debtor all necessary briefs, motions, applications, orders, reports and other papers in connection with the appeal; (c) represent the Debtor at hearings and oral arguments on the appeal, and protect the interests of the Debtor; and (d) perform any other necessary legal services in connection with the prosecution of the appeal. The current hourly rates applicable to the principal attorneys, paralegals, and professionals proposed to represent the Debtor are: Philip Ward, Esq. $810 David Aufhauser, Esq. $735 Stephen Andrews, Esq. $665 Ryan McCarthy, Esq. $550 Andrew Elliott, Esq. $525 Debbie Cackowoski, Esq. $335 Paralegal $205 Other attorneys, paralegals, and professionals will render services as needed. W&C's current hourly rates for the matter range from $810 to $665 per hour for partners and $550 to $525 per hour for associates. The firm will also seek reimbursement of necessary out-of-pocket expenses. Stephen Andrews, Esq., a partner of the firm of Williams & Connolly LLP, in Washington, D.C., assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. About Allonhill LLC Allonhill LLC, a professional services firm based in Denver, Colorado, that previously provided loan due diligence and credit risk management services for institutions that invest in, sell, securitize or service mortgage loans, sought protection under Chapter 11 of the Bankruptcy Code on March 26, 2014. The case is In re Allonhill, LLC, Case No. 14-bk-10663 (Bankr. D. Del.). The Debtor's General Counsel is HOGAN LOVELLS US LLP. The Debtor's Local Counsel is Neil B. Glassman, Esq., Justin R. Alberto, Esq., and Evan T. Miller, Esq., at BAYARD, P.A., in Wilmington, Delaware. Upshot Services LLC serves as the Debtor's Claims and Noticing Agent. The Debtor disclosed $19,205,062 in assets and $32,918,294 in liabilities as of the Chapter 11 filing. Roberta A. DeAngelis, U.S. Trustee for Region 3, notified the Bankruptcy Court that she was unable to appoint an official committee of unsecured creditors in the case of Allonhill, LLC. The U.S. Trustee explained that there were insufficient response to the communication/contact for service on the committee. ALLONHILL LLC: Can Tap Haddon as Special Appellate Counsel ---------------------------------------------------------- Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware authorized Allonhill LLC to employ Haddon, Morgan, and Foreman, P.C., as special appellate counsel. Haddon Morgan as a firm and Norm Mueller in particular have extensive experience and expertise in appellate litigation in state courts in Colorado. Given Mr. Mueller's familiarity with appellate litigation in the state courts of Colorado, the Debtor believes that Mr. Mueller is the best qualified attorney and Haddon Morgan is the best qualified law firm to provide the specialized legal services as local counsel and specialist in Colorado appellate litigation, especially in the action styled Allonhill, LLC v. Aurora Bank, FSB, No. 12CV6381, District Court, City and County of Denver, Colorado. Haddon's services will only encompass the following specified purposes: (a) advise the Debtor in connection with the legal aspects of an appeal in the Debtor's Colorado Action; (b) prepare on behalf of the Debtor all necessary briefs, motions, applications, orders, reports and other papers in connection with the appeal; (c) represent the Debtor at hearings and oral arguments on the appeal, and protect the interests of the Debtor; and (d) perform any other necessary legal services in connection with the prosecution of the appeal. Mr. Mueller's current hourly rate is $450. Haddon Morgan's currently hourly rates for the matter range from $425 to $550 per hour for partners and $315 and $325 per hour for associates. The firm will also seek reimbursement of necessary out-of-pocket expenses. Mr. Mueller, a partner of the firm of Haddon, Morgan & Foreman, P.C., in Denver, Colorado, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. About Allonhill LLC Allonhill LLC, a professional services firm based in Denver, Colorado, that previously provided loan due diligence and credit risk management services for institutions that invest in, sell, securitize or service mortgage loans, sought protection under Chapter 11 of the Bankruptcy Code on March 26, 2014. The case is In re Allonhill, LLC, Case No. 14-bk-10663 (Bankr. D. Del.). The Debtor's General Counsel is HOGAN LOVELLS US LLP. The Debtor's Local Counsel is Neil B. Glassman, Esq., Justin R. Alberto, Esq., and Evan T. Miller, Esq., at BAYARD, P.A., in Wilmington, Delaware. Upshot Services LLC serves as the Debtor's Claims and Noticing Agent. The Debtor disclosed $19,205,062 in assets and $32,918,294 in liabilities as of the Chapter 11 filing. Roberta A. DeAngelis, U.S. Trustee for Region 3, notified the Bankruptcy Court that she was unable to appoint an official committee of unsecured creditors in the case of Allonhill, LLC. The U.S. Trustee explained that there were insufficient response to the communication/contact for service on the committee. ALLONHILL LLC: Can Hire EKS&H as Tax Accountant, Auditor -------------------------------------------------------- Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware authorized Allonhill LLC to employ EKS&H LLLP as tax accountant and auditor. EKS&H's services will include the following: (a) provide Dec. 31, 2013, and stub period 2014 closing employee benefit plan audits; (b) prepare tax extensions for the 2013 taxes; and (c) prepare 2013 federal and state returns related to the taxes. EKS&H's current hourly rates range from $150 per hour for staff and $410 per hour for partners. The firm will also seek reimbursement of expenses incurred in its representation of the Debtor. During the one-year period prior to the Petition Date, EKS&H provided services for the Debtor, and the Debtor paid EKS&H the amount of $70,660 in fees. As of the Petition Date, EKS&H was owed approximately $3,000 by the Debtor for services invoiced in February 2014. Brad McQueen, a certified public accountant and a partner of the firm of EKS&H LLLP, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Mr. McQueen, however, discloses that his firm performed, currently performs, and in the future may perform Accuvant, Intellisource, LLC, Margaret Sue Allon, MeetingOne Conferencing, and Stewart Lender Services, in matters unrelated to the bankruptcy case. About Allonhill LLC Allonhill LLC, a professional services firm based in Denver, Colorado, that previously provided loan due diligence and credit risk management services for institutions that invest in, sell, securitize or service mortgage loans, sought protection under Chapter 11 of the Bankruptcy Code on March 26, 2014. The case is In re Allonhill, LLC, Case No. 14-bk-10663 (Bankr. D. Del.). The Debtor's General Counsel is HOGAN LOVELLS US LLP. The Debtor's Local Counsel is Neil B. Glassman, Esq., Justin R. Alberto, Esq., and Evan T. Miller, Esq., at BAYARD, P.A., in Wilmington, Delaware. Upshot Services LLC serves as the Debtor's Claims and Noticing Agent. The Debtor disclosed $19,205,062 in assets and $32,918,294 in liabilities as of the Chapter 11 filing. Roberta A. DeAngelis, U.S. Trustee for Region 3, notified the Bankruptcy Court that she was unable to appoint an official committee of unsecured creditors in the case of Allonhill, LLC. The U.S. Trustee explained that there were insufficient response to the communication/contact for service on the committee. ALLY FINANCIAL: Moody's Affirms Ba3 CFR & B1 Sr. Unsecured Rating ----------------------------------------------------------------- Moody's Investors Service affirmed the Ba3 corporate family and B1 senior unsecured ratings of Ally Financial, Inc. and revised the outlook for the ratings to positive from stable. Ratings Rationale Moody's affirmed Ally's ratings and revised its rating outlook to positive based on the company's progress toward sustained improvements in profitability and repayment of government assistance received during the financial crisis. Ally's operating performance is improving, driven by lower borrowing and operating costs. Ally's liability management actions and continued transition to deposit funding have lowered the firm's cost of funds and strengthened its net interest margin, which measured 2.53% for the first quarter of 2014, up from 2.07% one year earlier. Moody's expects that Ally's margins will continue to benefit from repayment of higher-cost indebtedness and growth in deposits, though competitive pressure on assets yields represents a headwind. The company's efforts to streamline its business resulted in a $70 million year-over-year reduction in controllable expenses in the first quarter, leading to an adjusted efficiency ratio of 55%, down from 64% for 2013. Ally is working to achieve additional efficiency gains that Moody's expects will result in a further improvement to the company's operating performance. Ally has made significant progress repaying government support. In January, the U.S. Treasury privately placed $3 billion of Ally common stock and in April, Ally completed a $2.6 billion IPO on the NYSE. To date, the U.S. government has received $17.8 billion on its $17.2 billion extension of aid to Ally during the financial crisis. The U.S. Treasury's equity stake in Ally was reduced to 16% after the transactions. The share sales and IPO expanded and diversified Ally's investor base which, in Moody's view, contributes to improved access to capital, governance and transparency. Moody's expects that Ally will maintain good capital discipline as it pursues strategies to provide higher returns to shareholders. Ally's ratings and outlook are supported by its position as a leading provider of U.S. dealer and retail auto finance, its effective liquidity management and adequate capitalization. A credit concern is strong competition that could potentially weaken Ally's franchise positioning and underwriting discipline. Bank and captive finance competitors have already eroded Ally's penetration of GM and Chrysler dealer financing and its financing share of GM and Chrysler retail auto sales. Ally has diversified its originations to include more leasing and used car lending, and it has modestly expanded lower credit-tier originations, helping to both drive volumes and preserve average asset yields. However, Moody's expects that these shifts in origination mix will lead to higher credit losses over time. Ally's rating could be upgraded if the company sustainably strengthens profitability (toward a 1% return on assets) while demonstrating disciplined underwriting and maintaining strong franchise positioning, and maintains adequate liquidity and capital levels (at least 9% tangible common equity/tangible managed assets). Ratings could be downgraded if Ally reports a material deterioration in asset quality performance and profitability, or a materially weakened capital or liquidity profile. Ally Financial Inc. is a provider of automotive financial services with $148 billion in total assets at March 31, 2014. Subsidiary Ally Bank offers a variety of savings and checking account products. Affirmed: Ally Financial Inc.: Corporate family rating, Ba3 Issuer rating, B1 Senior unsecured, B1 Senior unsecured Medium-Term Note program, (P)B1 Senior unsecured shelf, (P)B1 Subordinate debt, B2 Preferred stock, a range of Caa1(hyb) to B3(hyb) Short-term debt, a range of (P)NP to NP GMAC Capital Trust I: Preferred Stock, B3(hyb) GMAC International Finance B.V.: Senior Unsecured, B1 Senior unsecured Medium-Term Note program, a range of (P)NP to (P)B1 The principal methodology used in this rating was Finance Company Global Rating Methodology published in March 2012. AMERICAN APPAREL: Arbitration Clauses Let Retailer Hide Misconduct ------------------------------------------------------------------ Steven Davidoff Solomon, writing for The New York Times' DealBook, reported that American Apparel's arbitration clauses allowed it to hide its founder's alleged misconduct. According to the DealBook, the company required that all employees sign agreements requiring them to arbitrate any disputes, including sexual harassment claims. The purpose of these clauses was to ensure that any dispute was kept quiet and protect the company from excessive damages, the report said. Moreover, employees were also contractually barred from disparaging or otherwise say anything bad about Dov Charney or American Apparel, the DealBook added. 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. ARTURO J. GONZALEZ: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Arturo J. Gonzalez P.C. 2120 Capitol St., Ste 3339 Houston, TX 77003 Case No.: 14-33888 Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Hon. Jeff Bohm Debtor's Counsel: Reese W Baker, Esq. BAKER & ASSOCIATES 5151 Katy Freeway, Ste 200 Houston, TX 77007 Tel: 713-869-9200 Fax: 713-869-9100 Email: courtdocs@bakerassociates.net Estimated Assets: $50,000 to $100,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Arturo J. Gonzalez, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. ASHLEY STEWART: Plan Exclusivity Period Extended Until Nov. 4 ------------------------------------------------------------- Ashley Stewart Holdings Inc. sought and obtained permission from the U.S. Bankruptcy Court to (i) extend the period within which the Debtors have the exclusive right to file a plan or plans of reorganization and (ii) extend the period within which the Debtors have the exclusive right to solicit acceptance of any plan. The Debtors' Exclusive Filing Period is extended through and including November 4, 2014, without prejudice to the Debtors' right to seek further extensions thereof. The Debtors' Exclusive Solicitation Period is extended through and including January 2, 2015, without prejudice to the Debtors' right to seek further extensions thereof. About Ashley Stewart The Ashley Stewart name is synonymous with offering women who wear sizes 12 and up well-made fashionable clothes at affordable prices. Ashley Stewart Holdings Inc. and affiliates New Ashley Stewart Inc., AS IP Holdings Inc. and NAS Gift LLC filed Chapter 11 petitions in Newark, New Jersey (Bankr. D.N.J. Case Nos. 14-14383 to 14-14386) on March 10, 2014. Michael A. Abate signed the petitions as senior vice president finance/treasurer. Ashley Stewart Holdings estimated assets and liabilities of at least $10 million. The Hon. Michael B. Kaplan oversees the case. Curtis, Mallet-Prevost, Colt & Mosle LLP serves as the Debtors' general counsel. Cole, Schotz, Meisel, Forman & Leonard, P.A., is the Debtors' local counsel. PricewaterhouseCoopers LLP acts as the Debtors' financial advisor. Prime Clerk LLC serves as the Debtors' claims and noticing agent. Ashley Stewart has obtained authority to conduct store closing sales at 27 locations around the United States in accordance with a consulting agreement with Gordon Brothers Retail Partners, LLC. ASTON ESCROW: S&P Assigns 'B' CCR & Rates $440MM Secured Notes 'B' ------------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'B' corporate credit rating to Horsham, Pa.-based Aston Escrow Corp. The outlook is stable. S&P also assigned a 'B' issue-level rating and '4' recovery rating to Aston Escrow Corp.'s $440 million senior secured notes due 2021. The '4' recovery rating indicates S&P's expectation for "average" (30% to 50%) recovery of principal in the event of payment default. The proposed privately placed notes, along with a common equity contribution from private equity sponsor Platinum Equity Advisors, will fund the purchase of Transworld Systems Inc., a business processing outsourcing (BPO) and accounts receivable management (ARM) business, from Expert Global Solutions Inc. Subsequent to the expected September 2014 acquisition of Transworld Systems Inc., Aston Escrow Corp. will merge with, and into, the surviving entity, Transworld Systems Inc. (TSI). TSI is a leading North American provider of BPO and outsourced ARM. TSI's key ARM segment provides a continuum of accounts receivable services including customer billing, delinquent account collection, and recovery of charged-off delinquent accounts. The company generates revenues from fixed and contingency fees based on the amount of recovery; it does not purchase the debt obligation. Key customer groups are education, government, legal, and health care and commercial. "The ratings on Aston Escrow Corp. recognize significant competition for TSI's outsourced ARM services and the potential for regulatory and pricing pressures that could weaken margins," said Standard & Poor's credit analyst Richard Siderman. The stable outlook incorporates S&P's expectation that Aston Escrow Corp.'s ARM business is positioned to take advantage of growing outstanding accounts receivable and leverage its systems and expertise to mitigate potential regulatory changes or lower commissions that could pressure margins. Policy changes at the DOE to markedly increase its number of ARM vendors or reduce commission rates, or a loss of a major client could result in an unfavorable revision of S&P's business risk assessment to "vulnerable" and result in a rating downgrade. Private equity ownership constrains improvement in the company's "highly leveraged" financial risk profile. A rating upgrade, therefore, would result from a significant improvement in S&P's view of the company's business risk profile, a reassessment that S&P believes is not likely over the year. ATLS ACQUISITION: Has Until Aug. 30 to Decide on Unexpired Leases ----------------------------------------------------------------- At the behest of ATLS Acquisition, LLC, the Bankruptcy Court extended until Aug. 30, 2014, the Debtor's deadline to assume or reject unexpired leases of nonresidential real property pursuant to Section 365(a)(4) of the Bankruptcy Code. The Debtor is represented by Dennis A. Meloro, Esq., at Greenberg, Traurig, LLP of Wilmington, Delaware and Nancy A. Mitchell, Esq. and Matthew L. Hinker, Esq. at the New York, New York office of Greenberg Taurig. About Liberty Medical Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. Dennis A. Meloro, Esq., at Greenberg Traurig, LLP, serves as the Debtor's counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. An official committee of unsecured creditors has been appointed in the case and consists of LifeScan, Inc., Abbott Laboratories, and Teva Pharmaceuticals USA, Inc. They are represented by Joseph H. Huston Jr., Esq., Maria Aprile Sawczuk, Esq., and Camille C. Bent, Esq., of Stevens & Lee P.C. as well as Bruce Buechler, Esq., S. Jason Teele, Esq., and Nicole Stefanelli, Esq. of Lowenstein Sandler LLP. The Committee has tapped Mesirow Financial Consulting, LLC, as financial advisors. BAPTIST HOME: Has Aug. 15 Auction of Assets ------------------------------------------- Judge Eric L. Frank of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania approved the bidding procedures governing the sale of the assets of The Baptist Home of Philadelphia, d/b/a Deer Meadows Retirement Community, et al., and scheduled an auction on Aug. 15, 2014, if at least one qualified bid, other than the stalking horse bidder's qualified bid, is received. Bids are due Aug. 8. The sale hearing is scheduled to be held on Aug. 27, at 10:00 a.m. Objections to the proposed sale and objections relating to the assumption and assignment of executory contracts and/or unexpired leases must be submitted on or before Aug. 25. Judge Frank also approved a settlement agreement among the Debtors, U.S. Bank National Association, as indenture trustee, Beneficial Mutual Savings Bank, and the Official Committee of Unsecured Creditors. The agreement provides the terms of a plan dividing proceeds from the sale of the Debtors' assets. In return for agreement on senior creditors' claims, $750,000 is carved out for unsecured creditors, Bill Rochelle, the bankruptcy columnist for Bloomberg News, said. In addition, if the sale is for more than $19 million, unsecured creditors receive 5 percent on a sliding scale reaching 7 percent if the price is more than $22 million. About The Baptist Home of Philadelphia The Baptist Home of Philadelphia and The Baptist Home Foundation sought Chapter 11 protection (Bankr. E.D. Pa. Case Nos. 14-13305 and 14-13306) in Philadelphia on April 25, 2014. Baptist Home of Philadelphia is a Pennsylvania nonprofit corporation that owns and operates a continuing care retirement community known as "Deer Meadows Retirement Community", which is located at 8301 Roosevelt Boulevard, Philadelphia, Pennsylvania. Home offers 126 living accommodations, which vary in size, for independent living and personal care. It presently also has 206 skilled nursing beds in the nursing and rehabilitation center that offers short and long term care. It has 369 employees. Baptist Home of Philadelphia disclosed $37,330,904 in assets and $34,562,834 in liabilities as of the Chapter 11 filing. The Debtors have tapped Cozen O'Connor as counsel and KPMG Corporate Finance LLC as financial advisor and investment banker. The U.S. Trustee appointed Wilmarie Gonzalez as patient care ombudsman. U.S. Bank National Association, the trustee with regard to the secured bond indebtedness, hired Reed Smith LLP as counsel and CohnReznick LLP as financial advisor. Pepper Hamilton LLP represents the Official Committee of Unsecured Creditors. BANESCO USA: Fitch Affirms 'B+' Long-term Issuer Default Rating --------------------------------------------------------------- Fitch Ratings has affirmed the Long-and Short-term IDRs of Banesco USA (BNSC) at 'B+/B', respectively. The Rating Outlook is Stable. Key Rating Drivers - IDRs, VR BNSC's IDRs are currently constrained by low levels of profitability, its geographic and product concentration to the South Florida CRE market, and exposure to non-domestic credit markets. Conversely, the capital base and stable funding profile provide support to the credit profile and ratings. Although credit performance has remained solid over the past seven quarters and dramatically improved since the financial crisis, asset quality indicators may be benefitting from the rapid loan portfolio growth BNSC has experienced since 2011. BNSC remained profitable during 2013, although earnings have trended downward since 2011 and are considered a key rating constraint. BNSC reported an ROA of just 33bps in 2013. Earnings were constrained by very high operating expenses due to elevated levels of personnel and occupancy expenses associated with hiring executive level and BSA related employees during 2013. Fitch expects that operating costs are likely to continue to constrain earnings potential in the near term as additional costs associated with the BSA remediation program will weigh heavily on earnings throughout 2014. Fitch also expects the NIM to decline in the near term due to the diminishing impact of discount accretion related to the purchase of loans from Security Bank N.A in 2012. Fitch considers BNSC's credit risk profile to be reflective of the rating. The company has exhibited strong growth, particularly in CRE and commercial credits, in recent years. Moreover, Fitch also considers BNSC to be product and geographically concentrated as CRE represents 400% of capital and is mainly in the Miami-Dade MSA. While the South Florida CRE market has exhibited slowly stabilizing real estate values, the office real estate sector, which is a sizeable portion of the CRE portfolio, has not exhibited any material level of recovery. Fitch also remains concerned about BNSC's increasing exposure to commercial and CRE credits in Puerto Rico due to the commonwealth's fragile economy and recessionary climate. Additional credit risk considerations include the effects of sovereign risk in the international loan portfolio which makes up approximately 11% of total loans. Over half of the international portfolio consists of exposure to borrowers in Venezuela and is mainly secured by residential, and to a lesser extent CRE properties in South Florida. Although economic instability remains a concern in Venezuela, credit risk is offset by the strong level of collateral protection and prudent non-resident credit underwriting standards. BNSC's credit quality has improved. Asset quality indicators compare positively to that of similarly rated peers; however, Fitch believes the measures may be understated given that the portfolio is relatively unseasoned due to level of loan growth in recent years. In the first quarter of 2014, total nonperforming assets (inclusive of accruing TDRs) have declined to 277 bps of loans and foreclosed real estate through a combination of pay downs, loan sales and workout strategies, while NCOs have averaged three bps of loans over the past four quarters. These measures are well below the peak levels experienced during the financial crisis of roughly 9.83% and 1.80%, respectively. BNSC's credit rating benefits from a solid capital structure. As of year-end 2013, the company's Fitch core capital/risk-weighted assets ratio was 13.37% and its tangible common equity/tangible assets ratio was 9.4%. Fitch considers the capital base sufficient to support risks within the business mix; however, further balance sheet growth coupled with limited profitability have the potential to adversely impact capital ratios. Moreover, the lack of access to external capital is considered a rating constraint. Fitch views BNSC's funding profile favorably. The funding structure is largely core deposit driven, and benefits from a high volume of international deposits which make up 61% of total deposits. The majority of international funding is sourced from Venezuelan depositors who have turned to U.S. banks as a safe haven. These deposits typically have a very low attrition rate, limited rate sensitivity and provide a stable source of low cost funding. In an effort to reduce reliance on Venezuelan funding, management has been working to grow domestic deposits in conjunction with loan growth. Fitch views the diversification of funding sources positively. Although the loan portfolio has grown significantly since 2011, balance sheet leverage remains below peer levels as loans makeup 75.5% of deposits. Furthermore, BNSC maintains a high level of liquid assets to support immediate cash needs. Fitch believes BNSC is well positioned to maintain its liquidity position, fund impending growth/runoff and address any potential shortfalls in the normal course of business. Fitch views BNSC's relationship with the Banesco Group positively. The brand affiliation has supported BNSC's deposit raising efforts and also provides a more sophisticated risk management infrastructure which is comparable to larger institutions. The Stable Outlook reflects BNSC's stable credit performance and lowered growth expectations in light of the shift in strategy toward addressing issues related to BSA/AML oversight. Going forward, management anticipates controlled growth in key business segments with no expectations for further acquisitions over the near-term. Rating Sensitivities - IDRs, VR Sustained and improved profitability combined with the maintenance of strong credit performance and credit profit would be considered positive rating drivers. Given BNSC's ratings are relatively low on the rating scale, Fitch does not envision much downward rating pressure. However, ratings could be negatively affected if BNSC continues to grow in high risk lending segments, in excess of manageable levels or if Fitch believes that growth is a result of compromised underwriting. Considering the recent trends and updated growth plans, Fitch considers this a relatively low likelihood. Fitch notes that there is risk in Venezuelan depositors seeking other U.S. based-banking institutions to deposit their monies in the event of concern regarding BNSC or the Banesco Group. However, to date, BNSC has actually benefited from its association with the Banesco brand, despite volatility in Venezuela, as demonstrated by its stable deposit base. Nonetheless, BNSC's ratings may be vulnerable to changing depositor behavior, if Banesco Group itself were the subject of concern. Key Rating Drivers - Support Rating And Support Rating Floor BNSC has a Support Rating of '5' and Support Rating Floor of 'NF'. In Fitch's view, BNSC is not systemically important and therefore, the probability of support is unlikely. The IDRs and VRs do not incorporate any support. Historically, BNSC's principal shareholders have demonstrated a willingness to provide capital; however, Fitch's rating analysis does not assume capital support from the shareholders Rating Sensitivities - Support Rating and Support Rating Floor BNSC's Support Rating and Support Rating Floor are sensitive to Fitch's assumption around capacity to procure extraordinary support in case of need. Key Rating Drivers - Long And Short-Term Deposit Ratings BNSC's uninsured deposit ratings are rated one notch higher than the company's IDR because U.S. uninsured deposits benefit from depositor preference. U.S. depositor preference gives deposit liabilities superior recovery prospects in the event of default. Rating Sensitivities - Subordinated Debt And Other Hybrid Securities The ratings of long- and short-term deposits issued by BNSC are primarily sensitive to any change in BNSC's long- and short-term IDRs. Fitch affirms the following ratings: Banesco USA (BNSC) -- Long-term IDR at 'B+'; Outlook Stable; -- Short-term IDR at 'B'; -- Long-term deposits at 'BB-'; -- Short-term deposits at 'B'; -- Viability at 'b+'; -- Support at '5'; -- Support Floor at 'NF'. BERNARD L. MADOFF: Ruling Blocks Risky Expansion Of Bankruptcy Law ------------------------------------------------------------------ Law360 reported that U.S. District Judge Jed Rakoff's decision to save foreign investment funds from disgorging earnings from the Bernard L. Madoff fraud rejected an unprecedented attempt to expand U.S. bankruptcy law across borders and ensured that international investors have little to fear from defunct U.S. firms' liquidating trustees, attorneys say. Judge Rakoff's decision, according to Bill Rochelle, the bankruptcy columnist for Bloomberg News, which bars the trustee for Bernard L. Madoff Investment Securities LLC from filing suit in the U.S. against foreign investors who got stolen money through so-called offshore feeder funds, further dims hopes by victims of Madoff's fraud that they will ever recover all $17 billion they invested in his Ponzi scheme. The judge rejected Picard's argument based on the provision in U.S. bankruptcy law giving the trustee title to property "wherever located" and said fraudulently transferred property isn't "estate property" until after it's recovered, concluding that congressional intent for the trustee to sue foreigners in the U.S. isn't shown by the definition of estate property, Mr. Rochelle related. Judge Rakoff's decision was made in In re Bernard L. Madoff Investment Securities LLC, 12-mc-00115, U.S. District Court, Southern District of New York (Manhattan). About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.). From recoveries in lawsuits coupled with money advanced by SIPC, Mr. Picard has paid about 58 percent of customer claims totaling $17.3 billion. The most recent distribution was in March 2013. Mr. Picard has collected about $9.35 billion, not including an additional $2.2 billion that was forfeit to the government and likewise will go to customers. Picard is holding almost $4.4 billion he can't distribute on account of outstanding appeals and disputes. The largest holdback, almost $2.8 billion, results from disputed claims. BRINX RESOURCES: Reports $109K Net Loss in April 30 Quarter ----------------------------------------------------------- Brinx Resources Ltd. filed its quarterly report on Form 10-Q, disclosing a net loss of $109,605 on $20,952 of natural gas and oil sales for the three months ended April 30, 2014, as compared with a net loss of $136,019 on $58,182 of natural gas and oil sales for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $1.48 million in total assets, $46,086 in total liabilities, and stockholders' equity of $1.44 million. The Company has incurred a net loss of $1.4 million since inception. To achieve profitable operations, the Company requires additional capital for obtaining producing oil and gas properties through either the purchase of producing wells or successful exploration activity. Management believes that sufficient funding will be available to meet its business objectives including anticipated cash needs for working capital and is currently evaluating several financing options. However, there can be no assurance that the Company will be able to obtain sufficient funds to continue the development of its properties and, if successful, to commence the sale of its projects under development. As a result of the foregoing, there exists substantial doubt about the Company's ability to continue as a going concern, according to the regulatory filing. A copy of the Form 10-Q is available at: http://is.gd/GXqlxG Headquartered in Albuquerque, New Mexico, Brinx Resources Ltd. (OTC BB: BNXR.OB) -- http://www.brinxresources.com/-- is an expanding exploration company focused on developing North American oil and natural gas reserves. The company's current focus is on the continued exploration and development of its land portfolio comprised of working interests in the Owl Creek Project located in McClain County, Oklahoma (50% interest), the Three Sands Project located in Noble County, Oklahoma (40% interest), and its newest interest in its Mississippi Prospect in Palmetto Point (10% interest). BRITISH AMERICAN: Fraudulent Transfer Claims Kept Alive In RE Suit ------------------------------------------------------------------ Law360 reported that a Florida federal judge kept alive fraudulent transfer claims brought by Caribbean insurer British American Insurance Co. Ltd. and a subsidiary against former directors over unsuccessful real estate transactions in Florida that allegedly led to the companies' Chapter 15 insolvency. According to the report, U.S. District Judge James I. Cohn, in adopting the Southern District bankruptcy court's recommendations, rejected arguments made by defendants Green Island Holdings LLC, Charles Pratt, Peter Krieger and Voyager Development LLC. About BAICO British American Insurance Company is a Nassau, Bahamas-based insurance and financial services company. BAIC is owned by Trinidad-based parent CL Financial. BAIC listed debt of $500 million to $1 billion and assets of more than $100 million in its Chapter 15 petition (Bankr. S.D. Fla. Case No. 09-3588). By order entered Aug. 4, 2009, the Eastern Caribbean Supreme Court in the High Court of Justice Saint Vincent and the Grenadines appointed Brian Glasgow as Judicial Manager for BAICO under Section 52 of the Insurance Act, No. 45 of 2003 of the Laws of Saint Vincent and the Grenadines. BURCON NUTRASCIENCE: PwC LLP Raises Going Concern Doubt ------------------------------------------------------- Burcon NutraScience Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 40-F for the fiscal year ended March 31, 2014. PricewaterhouseCoopers LLP expressed substantial doubt about the Company's ability to continue as a going concern, citing that the Company had only minimal revenues from its technology, had an accumulated deficit of C$64.4 million and had relied on equity financings, private placements, rights offerings and other equity transactions to provide the financing necessary to undertake its research and development activities. At March 31, 2014, the Company had cash and cash equivalents of C$1.39 million. The Company reported a net loss of C$5.96 million on C$94,724 of royalty income for the fiscal year ended March 31, 2014, compared with a net loss of C$5.54 million on C$30,309 of royalty income in 2013. The Company's balance sheet at March 31, 2014, showed C$5.12 million in total assets, C$799,671 in total liabilities, and stockholders' equity of C$4.32 million. A copy of the Form 40-F is available at: http://is.gd/25BNKq Headquartered in Vancouver, Canada, Burcon NutraScience Corporation has developed a portfolio of composition, application, and process patents originating from its core protein extraction and purification technology. The Company's patented processes utilize inexpensive oilseed meals and other plant-based sources for the production of purified plant proteins that exhibit certain nutritional, functional and nutraceutical profiles. CABEL PROPERTIES: Files List of 20 Largest Unsecured Creditors -------------------------------------------------------------- Cabel Properties LLC filed its list of creditors holdings 20 largest unsecured claims. A full-text copy of the list is available for free at http://is.gd/On3p6I About Cabel Properties Cabel Properties, LLC, filed a Chapter 11 petition (Bankr. M.D. Pa. Case No. 14-02370) in Wilkes-Barre, Pennsylvania, on May 20, 2014. The Debtor estimated assets of $10 million to $50 million and debt of $50,000 to $100,000. Judge John J Thomas oversees the case. The Tafton, Pennsylvania-based company is represented by Jeffrey D Kurtzman, Esq., at Klehr, Harrison, Harvey, Branzburg LLP, in Philadelphia, as counsel. CABEL PROPERTIES: Files Schedules of Assets and Liabilities ----------------------------------------------------------- Cabel Properties LLC filed its schedules of assets and liabilities, disclosing total assets of $22,000,000, and total liabilities of $24,201,798. A full-text copy of the schedules is available for free at http://is.gd/6hXwvw About Cabel Properties Cabel Properties, LLC, filed a Chapter 11 petition (Bankr. M.D. Pa. Case No. 14-02370) in Wilkes-Barre, Pennsylvania, on May 20, 2014. The Debtor estimated assets of $10 million to $50 million and debt of $50,000 to $100,000. Judge John J Thomas oversees the case. The Tafton, Pennsylvania-based company is represented by Jeffrey D Kurtzman, Esq., at Klehr, Harrison, Harvey, Branzburg LLP, in Philadelphia, as counsel. CABEL PROPERTIES: Seeks to Assume 2009 Purchase Agreement --------------------------------------------------------- Cabel Properties LLC asks the Hon. John J. Thomas of the U.S. Bankruptcy Court for the Middle District of Pennsylvania for permission to assume a purchase agreement dated Jan. 26, 2009, as modified, with Middle Creek Quarry Inc. On Jan. 26, 2009, Middle Creek entered into an agreement with the Debtor to manage the property located on Owego Turnpike, Palmyra Township in Wayne County, Pennsylvania. On May 2, 2013, the sellers George Cabel, Cabel Associates and the Debtor entered into a mutual release agreement, wherein the sellers agreed to convey the property to the Debtor in consideration of the Debtor's payment of a "final release price" of $550,000. Additionally, the sellers acknowledged that, between the execution of the purchase agreement in 2009, and the execution of the mutual release agreement in May 2013, Mr. Cabel and affiliates had conferred value for the benefit of the sellers in the amount of $22,000,000. The purpose of the mutual release agreement was therefore to quantify the extent of the Debtor's remaining obligation to the sellers and to specify the remaining conditions precedent to the seller's conveyance of the property to the Debtor. About Cabel Properties Cabel Properties, LLC, filed a Chapter 11 petition (Bankr. M.D. Pa. Case No. 14-02370) in Wilkes-Barre, Pennsylvania, on May 20, 2014. George P. Cabel signed the petition as managing member. The Debtor estimated assets of $10 million to $50 million and debts of $50,000 to $100,000. Judge John J Thomas oversees the case. The Tafton, Pennsylvania-based company is represented by Jeffrey D Kurtzman, Esq., at Klehr, Harrison, Harvey, Branzburg LLP, in Philadelphia, as counsel. CARDTRONICS INC: S&P Affirms 'BB+' Corp. Credit Rating ------------------------------------------------------ Standard & Poor's Ratings Services said it affirmed its 'BB+' corporate credit rating on Houston-based Cardtronics Inc. The outlook is stable. At the same time, S&P assigned 'BB+' issue-level ratings and '3' recovery ratings to the company's proposed $250 million senior unsecured notes due 2022 and its existing $287.5 million 1% convertible senior notes due 2020. The '3' recovery rating indicates S&P's expectation of meaningful (50%-70%) recovery in the event of payment default. S&P also assigned a 'BBB' issue- level rating and '1' recovery rating to the company's $375 million revolving credit facility due 2019. The '1' recovery rating indicates S&P's expectation of very high (90%-100%) recovery in the event of payment default. "The rating on Cardtronics reflects our assessment of the company's 'fair' business risk profile, based on our view of its positive revenue and EBITDA growth prospects," said Standard & Poor's credit analyst Jenny Chang. The rating also reflects S&P's view of the company's "intermediate" financial risk profile, based on its expectation that the company will maintain leverage below 3x over the coming year. S&P's "fair" business risk profile assessment reflects Cardtronics' leadership position as an ATM service provider, with low earnings volatility, but also its still relatively limited product and geographic diversity, material customer concentration (the top five clients accounted for about 41% of revenues at Dec. 31, 2013), and strong competition from financial institutions and alternative electronic and digital payment technologies. S&P's business risk assessment also incorporates its view of the technology services industry's "intermediate" risk and the company's "very low" country risk. Additionally, S&P revised its assessment of the company's management and governance to "satisfactory" from "fair" to reflect its positive view of management's considerable expertise and experience in operating its major lines of business. S&P's stable rating outlook reflects its expectation that the company will continue to post solid revenue growth while maintaining EBITDA margins at current levels and a moderate financial policy. Given Cardtronics' improving geographic diversification and steady consumer demand for cash transactions, a downgrade is unlikely over the coming year. However, S&P could lower the rating if the company were to adopt a more aggressive financial policy that causes leverage to sustain above 3x. Considering Cardtronics' material client concentration and adequate scale, an upgrade is unlikely over the coming year. However, S&P could raise the rating over the longer term if the company can continue to diversify revenue sources, increase scale, and reduce and sustain leverage at 2x or below. CHARLOTTE RUSSE: S&P Revises Outlook to Pos. on Stock Redemption ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on specialty apparel retailer Charlotte Russe Inc. to positive from stable. At the same time, S&P affirmed all ratings, including the 'B' corporate credit rating. "The outlook revision reflects the company's lower debt levels following the redemption of a portion of preferred stock issues that we treated as debt," said Standard & Poor's credit analyst Tobias Crabtree. "We believe continued revenue and EBITDA gains along with lower debt levels could lead to improvements in credit measures over the next several quarters. The company's financial sponsor ownership, potential for additional debt-financed dividends, and a cautious consumer outlook tempers an upgrade at this time." Charlotte Russe's business risk profile reflects its participation in the highly competitive and widely fragmented specialty and fast fashion apparel retail segment. Although the company is a national retailer, it is much smaller than many of its peers. In S&P's view, the company has some brand recognition in its segment, and its value proposition resonates well with consumers given S&P's cautious consumer spending outlook. S&P notes that the company's operating efficiency metrics, while improving, remain below other rated specialty and fast fashion apparel peers. S&P's view of the company's financial risk profile includes its financial policies that favor debt, given its financial sponsor ownership. CHINA NATURAL: Alan Nisselon Named Interim Trustee -------------------------------------------------- Alan Nisselson, Esq., has been selected as the interim trustee for the case of China Natural Gas, Inc. Mr. Nisselson can be reached at: Alan Nisselson, Esq. WINDELS MARX LANE & MITTENDORF, LLP 156 West 56th Street New York, NY 10019 Tel: (212) 237-1000 Fax: (212) 262-1215 About China Natural Headquartered in Xi'an, Shaanxi Province, P.R.C., China Natural Gas, Inc., was incorporated in the State of Delaware on March 31, 1999. The Company through its wholly owned subsidiaries and variable interest entity, Xi'an Xilan Natural Gas Co., Ltd., and subsidiaries of its VIE, which are located in Hong Kong, Shaanxi Province, Henan Province and Hubei Province in the People's Republic of China ("PRC"), engages in sales and distribution of natural gas and gasoline to commercial, industrial and residential customers through fueling stations and pipelines, construction of pipeline networks, installation of natural gas fittings and parts for end-users, and conversions of gasoline-fueled vehicles to hybrid (natural gas/gasoline) powered vehicles at 0ptmobile conversion sites. On Feb. 8, 2013, an involuntary petition for bankruptcy was filed against the Company by three of the Company's creditors, Abax Lotus Ltd., Abax Nai Xin A Ltd., and Lake Street Fund LP (Bankr. S.D.N.Y. Case No. 13-10419). The Petitioners claimed that they have debts totaling $42,218,956.88 as a result of the Company's failure to make payments on the 5% Guaranteed Senior Notes issued in 2008. Adam P. Strochak, Esq., at Weil, Gotshal & Manges, LLP, in Washington, D.C., represents the Petitioners as counsel. China Natural Gas, Inc., sought dismissal of the involuntary petition but in July 2013, it consented to the entry of an order for relief under Chapter 11 of the U.S. Code. China Natural Gas employed Warren Street Global Inc. and designated J. Gregg Pritchard as chief restructuring officer. It employed as bankruptcy counsel Schiff Hardin LLP's Louis T. DeLucia, Esq., and Alyson M. Fiedler, Esq. As of Sept. 30, 2013, the Company had consolidated assets of $307,496,948 and liabilities of $87,714,323. CLEAREDGE POWER: Signs Doosan to $48 Million Contract ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that ClearEdge Power Inc., a producer of fuel cells, signed a contract where Doosan Corp. will kick off an auction on July 9 with a bid of about $48 million. According to the report, the July 9 auction will be followed by a hearing on July 11 for approval of sale to the prevailing bidder. The report said Doosan's purchase price includes $12.9 million in assumption of debt, while the remainder of the price is for assets subject to liens of secured creditors. 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. Power Inc. estimated $100 million to $500 million in both assets and debts. The petitions were signed by David B. Wright, chief executive officer. COASTLINE INVESTMENTS: Can Hire CBRE as Real Estate Broker ---------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California authorized Coastline Investments LLC and Diamond Waterfalls LLC to employ CBRE, Inc., as their real estate broker. The firm is expected to, among other things: 1. advertise and market the hotels to interested parties; 2. show hotels to interested parties; and 3. represent estates as sellers in connection with the sale of the hotels. The Debtors propose to compensate CBRE on these terms: a. in the event of a sale of the hotels, CBRE will be paid a commission equal to three percent of the gross sale if the marketing team represents both buyer and seller and four percent of the gross sale price if the marketing team represents only the sellers; b. the listing terms goes from April 1, 2014, to Sept. 30; and c) disputes between the Debtors and CBRE will be resolved by binding arbitration. Michael Shustak, senior vice president at Urban Investment Group of CBRE, related that the Debtors specifically sought assistance of three professionals for the engagement of Phillip Sample, Chris Caras and Mr. Shustak. Mr. Shustak assured the Court that CBRE is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Coastline and Diamond Coastline Investments, doing business as Hilltop Suites Hotel, and Diamond Waterfalls LLC, doing business as Diamond Bar Inn & Suites, filed Chapter 11 bankruptcy petitions (Bankr. C.D. Cal. Case No. 14-13028 and 14-13030) in Los Angeles on Feb. 18, 2014. The cases are jointly administered under Lead Case No. 14-30328. Coastline Investments is the owner of a hotel located at the top of a prominent hill with sweeping views in Pamona, California. The Hilltop Hotel consists of 130 suites located on three acres of hilltop property by Interstates 10 and 57, Cal-Poly Tech University, and the Los Angeles County fairgrounds, Fairplex. The Hilltop Hotel has three hotel floors along with two levels of parking and features and outdoor pool, spa, exercise fitness center, sauna, steam room and a full service restaurant, lounge, meeting spaces and a banquet ballroom to accommodate 300 guests. Diamond is the owner of a 161-room hotel located in Pomona, California. The Diamond Hotel is a full-service hotel, which includes a business center, meeting facilities, pool, spa, fitness center, steam, sauna and offices. The Debtors acquired both of the hotels through voluntary Chapter 11 bankruptcy court 11 U.S.C. Sec. 363 sales in February 2012. The Hilltop Hotel was acquired from Shilo Inn, Pamona Hilltop, LLC (Case No. 11-26270) and the Diamond Hotel was acquired from Shilo Inn, Diamond Bar LLC (Case No. 10-60884). The Debtors sought bankruptcy protection after the receiver appointed for the hotels scheduled a trustee sale for both hotels. The receiver was appointed at the behest of the investor group which provided a secured loan of $2,500,000, which the Debtors defaulted. The Debtors also have loans from First General Bank each in the amount of $5,250,000. Shin-Chung Liu is the 100% membership owner and managing member of both of the Debtors. The Debtors' affairs are managed by Liberty Capital Management Corporation. Judge Richard M. Neiter has been assigned to the cases. The Debtors are represented by David B. Golubchick, and J.P. Fritz, Esq., at Levene, Neale, Bender, Yoo & Brill L.L.P., in Los Angeles, California. No committee of unsecured creditors was appointed in the case. COLDWATER CREEK: Hearing Thurs. on Sale of Property Leases ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware will convene a hearing July 17, 2014, at 11:00 a.m., to consider the results of the July 8 auction for Coldwater Creek Inc., et al.'s non-residential real property leases. Greenberg Gibbons Commercial Corp., on behalf of Hunt Valley Towne Centre, LLC, landlord, objected to the sale motion stating that the proposed cure amount do not provide for payment of all obligations under the lease. Greenberg Gibbons added that a status conference must be set to deal with any amounts that remain unresolved after the period. Any sale must not be free and clear of obligations to pay all charges due under the leases, including unbilled year-end adjustments and reconciliations. VORH Associates, LLC, Ramco-Gershenson Properties, LP, and Avenue 450, LLC (objecting landlords) filed a precautionary objection to the Debtors' motion for approval of sale of leasehold interest, assumption and assignment of real property leases, and cure claim objection, stating that the Debtor and the proposed assignee must first comply with all the requirements of Section 365(b) and (f) of the Bankruptcy Code. The objecting landlords are the owners or the managing agents for the owners of numerous shopping centers located throughout the United States where the Debtors lease retail space. The Taubman Landlords submitted a precautionary objection to any prospective motion for approval of sale of leasehold interest, assumption and assignment of real property leases and cure claim objection. According to the Taubman Landlords, the Debtors proposed an extremely short period of time between the auction date and the hearing to approve the sale of the Debtors' leases. As reported in the Troubled Company Reporter on June 19, 2014, the Bankruptcy Court approved (i) procedures for the assumption and assignment of nonresidential real property leases; (ii) bidding procedures to govern the sale of the Debtors' nonresidential real property leases; and (iii) cure procedures. The Debtors scheduled a July 8 at the offices of Shearman & Sterling LLP located at 599 Lexington Avenue, New York City. Qualified bids were due June 26. On May 19, the Court authorized the Debtors to enter into an asset purchase agreement with ASJ Consulting, LLC, as purchaser. ASJ Consulting emerged as the wining bidder at the conclusion of the auction held on May 20. The back-up bidder was Naturopathica Holistic Health Inc. 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. COLONIAL BANK: Citi Says High Court Ruling Dooms $388M MBS Suit --------------------------------------------------------------- Law360 reported that Citigroup Inc. and others asked a New York federal judge to dismiss allegations they helped push Colonial Bank over a cliff by selling it $388 million in poor-quality mortgage-backed securities, saying the suit is doomed by a new U.S. Supreme Court ruling setting stricter limits on statutes of limitations. According to the report, the banks said that the reasoning in CTS v. Waldburger applies to the Federal Deposit Insurance Corp.'s allegations that the banks duped now-defunct Colonial Bank into buying $388 million worth of bad MBS. COMMUNITY MEMORIAL: Seeks Approval to Sell Cheboygan Property ------------------------------------------------------------- The official liquidating the assets of Community Memorial Hospital has filed a motion seeking court approval to sell a real property in Cheboygan, Michigan. The liquidating trustee has already reached an agreement with a certain Brian Williams, who offered to purchase the property for $22,500, but buyers who are interested with the property can still submit bids. Bids for the property must be submitted by noon on the first business day following court approval of the proposed sale. Bidders are required to provide Jack Douglas of Berkshire Hathaway Home Services, the trustee's real estate agent, with a purchase agreement on terms at least as favorable as Mr. Williams' offer but with an overbid of at least $1,000 and a $2,000 deposit. If the trustee receives a better offer, a public auction will be conducted via telephone at the office of his legal counsel Kuhn, Darling, & Quandt P.L.C., in Traverse City, Michigan. Bidding will occur in increments of $1,000. If no bidders come forward, the trustee will close the sale with Mr. Williams, according to the court filing. In connection with the proposed sale, the trustee also seeks court approval to pay the real estate agent a 10% commission at closing. CMH to Sell Cheboygan Property Separately, U.S. Bankruptcy Judge Daniel Opperman approved the sale of another real property owned by CMH, which is also located in Cheboygan. Judge Opperman gave the trustee the go-signal to sell the property to a certain Robert Szczesniak for $7,500, subject to receiving higher or better offers. Bidders are required to submit a purchase agreement on terms at least as favorable as Mr. Szczesniak's offer, but with an overbid of at least $8,500, and a deposit of $1,000. About Community Memorial Hospital Community Memorial Hospital, operator of the Cheboygan Memorial Hospital, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-20666) on March 1, 2012. Judge Daniel S. Opperman oversees the case. Paul W. Linehan, Esq., and Shawn M. Riley, Esq., at McDonald Hopkins LLC, in Cleveland, Ohio; and Jayson Ruff, Esq., at McDonald Hopkins LLC, in Bloomfield Hills, Michigan, represent the Debtor as counsel. The Debtor's financial advisor is Conway Mackenzie Inc. The Debtor disclosed $23,085,273 in assets and $26,329,103 in liabilities. Opened in 1942, the Debtor is an independent, not-for-profit entity, organized exclusively for charitable, scientific and educational purposes, and holds tax exempt status in accordance with Section 501(c)(3) of the Internal Revenue Code. The Cheboygan Memorial Hospital is a 25-bed critical access hospital located in Cheboygan, Cheboygan County, a community on the Lake Huron coast. The Debtor has 395 employees. McLaren Health Care Corporation proposed to acquire substantially all of the Debtor's operating assets at its primary hospital campus, for $5,000,000, plus (2) all amounts required for the Debtor to cure and assume the assigned Assumed Contracts and Leases. Daniel M. McDermott, the U.S. Trustee for Region 9, appointed a five-member official committee of unsecured creditors in the Chapter 11 case of Community Memorial Hospital. Michael S. McElwee, Esq., at Varnum LP, in Grand Rapids, Michigan, represents the Unsecured Creditors' Committee as counsel. The Creditors Committee won confirmation of its Corrected First Amended Plan of Liquidation for the Debtor in August 2013. A liquidating trust is established to liquidate the Debtor's remaining assets and distribute the proceeds to creditors. James Boyd has been designated as liquidating trustee. He is represented by Michael S. McElwee, Esq., of Varnum LLP. COMMUNITY MEMORIAL: Gets Approval to Settle Dispute With PHSI ------------------------------------------------------------- The official liquidating the assets of Community Memorial Hospital received court approval for a deal that would resolve CMH's dispute with Phoenix Health Systems, Inc. Under the deal, Phoenix Health agreed to return $31,000 to the liquidating trustee to resolve their dispute over amounts it received from CMH prior to the bankruptcy filing. The liquidating trustee sued Phoenix Health last year to recover $184,068. CMH's plan of liquidation, which the U.S. Bankruptcy Court for the Eastern District of Michigan approved in August last year, authorizes the trustee to pursue so-called avoidance claims to recover properties transferred within 90 days before the bankruptcy filing. About Community Memorial Hospital Community Memorial Hospital, operator of the Cheboygan Memorial Hospital, filed for Chapter 11 bankruptcy (Bankr. E.D. Mich. Case No. 12-20666) on March 1, 2012. Judge Daniel S. Opperman oversees the case. Paul W. Linehan, Esq., and Shawn M. Riley, Esq., at McDonald Hopkins LLC, in Cleveland, Ohio; and Jayson Ruff, Esq., at McDonald Hopkins LLC, in Bloomfield Hills, Michigan, represent the Debtor as counsel. The Debtor's financial advisor is Conway Mackenzie Inc. The Debtor disclosed $23,085,273 in assets and $26,329,103 in liabilities. Opened in 1942, the Debtor is an independent, not-for-profit entity, organized exclusively for charitable, scientific and educational purposes, and holds tax exempt status in accordance with Section 501(c)(3) of the Internal Revenue Code. The Cheboygan Memorial Hospital is a 25-bed critical access hospital located in Cheboygan, Cheboygan County, a community on the Lake Huron coast. The Debtor has 395 employees. McLaren Health Care Corporation proposed to acquire substantially all of the Debtor's operating assets at its primary hospital campus, for $5,000,000, plus (2) all amounts required for the Debtor to cure and assume the assigned Assumed Contracts and Leases. Daniel M. McDermott, the U.S. Trustee for Region 9, appointed a five-member official committee of unsecured creditors in the Chapter 11 case of Community Memorial Hospital. Michael S. McElwee, Esq., at Varnum LP, in Grand Rapids, Michigan, represents the Unsecured Creditors' Committee as counsel. The Creditors Committee won confirmation of its Corrected First Amended Plan of Liquidation for the Debtor in August 2013. A liquidating trust is established to liquidate the Debtor's remaining assets and distribute the proceeds to creditors. James Boyd has been designated as liquidating trustee. He is represented by Michael S. McElwee, Esq., of Varnum LLP. CORINTHIAN COLLEGES: Takedown Signals Tougher Agency Enforcement ---------------------------------------------------------------- John Lauerman, writing for Bloomberg News, reported that the U.S. Education Department has taken its toughest regulatory action ever against a for-profit college when it placed Corinthian Colleges Inc. on the path to going out of business. Bloomberg, citing analysts, noted that at least two large players -- ITT Educational Services Inc. and Education Management Corp. -- are also at some risk of stricter enforcement. The report related that in June 2010, the Obama administration released a package of proposed rules that the Association of Private Sector Colleges and Universities, an industry group, said would force hundreds of programs to close, eliminating skill-building opportunities for thousands of students. While that proposal, which would limit government funding for schools whose students struggle to repay loans, resurfaced after a court challenge from APSCU, it still awaits approval and would take years, perhaps until 2017, to be used to close any programs, the report said. D.A.B. GROUP: Stalled Allen Street Hotel in NY Files for Ch. 11 --------------------------------------------------------------- D.A.B. Group LLC, owner of a yet-to-be-finished 16-story Allen Street Hotel, in Orchard Street, New York, has sought Chapter 11 protection to pursue a prompt sale of the property. The Debtor estimates its property to be worth $35 million to $40 million. The property is located at 139-141 Orchard Street, in New York (Block 415, Lots 66 and 67). The property is improved by a partially constructed hotel, containing a steel superstructure, but no fa‡ade or exterior walls. DAB Group said it faces a ticking clock amid an August 2015 deadline set by the Board of Standards and Appeals to finish construction and thus will seek to promptly retain a broker and ready itself to sell its property through a bidding procedures motion and a liquidating plan. Debtor's Property Prior to various legal entanglements with the lender and other parties, the Debtor's property was under constructed to be developed as a 16-story boutique hotel (containing 92 rooms) to be known as the Allen Street Hotel. Development began in 2008 based upon $14.4 million of financing originally provided by Brooklyn Federal Savings Bank. The underlying mortgage notes were sold to the current holder, Orchard Hotel, LLC ("Lender"), in June 2011, after disputes arose with Brooklyn Federal concerning an extension of the loan maturity date. Requisitions under the mortgage loan ceased entirely in January 2011, leaving the project partially built. In the years that followed, extensive litigation ensued with the lender in the context of a foreclosure action in which the Debtor raised, inter alia, equitable estoppel defenses based upon assurances that the loan would be extended beyond March 1, 2011. The extension was confirmed when Brooklyn Federal approved a construction contract with Flintlock Construction Services, LLC, to complete construction by November 2011. While the Debtor's counterclaims against the Lender were overruled by the Appellate Division, the Lender was denied summary judgment on March 21, 2014, after the trial court (Judge Charles Ramos) found issues of fact with respect to the Debtor's equitable estoppel defenses relating to the extension of the maturity date. Events Leading to Filing "Rather than pursuing a conventional appeal, the Lender recently filed a writ of mandamus under Article 78 in the Appellate Division against the trial court judge, Hon. Charles Ramos, in an obvious effort to circumvent normal procedures. The Lender's gamesmanship has crystallized the growing belief that ongoing state litigation will only delay and cloud the Debtor's ability to sell the Property. Moreover, the Lender has launched unfounded and irrational attacks against me which are infuriating and only to serve to sidetrack the process. Accordingly, the Debtor has opted to seek Chapter 11 relief to utilize the provisions of the Bankruptcy Code to maximize the value of the Property and take advantage of a rising market, while the Lender's alleged claims for various interest charges and fee are properly and fairly litigated," Zvi Benjamin Zhavian, owner and manager of the Debtor, said in the court filing. According to Mr. Zhavian, although the equitable defenses may not nullify the principal due under the mortgage loan, they weigh prominently in evaluating the Lender's entitlement to default interest and fees, which will be vigorously challenged by the Debtor in the context of a claims objection process. Indeed, since the Debtor was unfairly denied the ability to refinance or complete construction, there is a strong argument that the Lender is not entitled to any interest after November 2011, but certainly not at the default rate of 24 percent per annum. Mr. Zhavian further notes of the Debtor's expiring rights under various extensions granted by the Board of Standards and Appeals to complete construction. Following various extensions, the current deadline expires on August 20, 2015. The Debtor notes that if construction is not timely completed, the project is then put in jeopardy because of an intervening change in zoning regulations. When construction was first commenced, the property was zoned C6-1 and a building permit was originally issued to build to a height of 191 feet. In late 2008, the zoning of the property was changed to C4-4A, which carries reduced footage and height limitations. The extension of the construction permit by the BSA protects against intervening zoning change, but not indefinitely. If construction is not completed by Aug. 20, 2015, there is a potential that a part of the building may have to be demolished to meet the reduced zoning regulations. Additionally, the property has also benefited from the "Stalled Sites Program" created by the City in response to the financial crisis. However, under this program, there is a requirement that some form of construction must commence by July 1, 2014. The Debtor consented to have the receiver, Simon Miller, resume construction pursuant to an order by Judge Ramos on June 26, 2015. Mr. Zhavian says that in bankruptcy, the Debtor is not necessarily adverse to the receiver continuing with overseeing ongoing work at the property so long as his involvement does not interfere with the Debtor's sale and reorganization efforts or burden the estate with unnecessary administrative costs. The Debtor says its main goal is to pursue a prompt sale so a new owner can take advantage of the C6-1 zoning regulations. The Debtor intends to promulgate a formal plan and disclosure statement within 90 days to meet the requirements of 11 U.S.C. Sec. 362(d)(3). It notes that the property is not otherwise income producing so there is an urgency to move forward with a comprehensive sale process. About DAB Group D.A.B. Group LLC, owner of a stalled 16-story Allen Street Hotel project in Orchard Street, New York, sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 14-12057) in Manhattan on July 14, 2014, to pursue a prompt sale of the property. The property has been in the hands of a receiver since July 18, 2011. Simon J.K. Miller, of Blank Rome LLP, serves as receiver. The Debtor is required to file its Chapter 11 plan and disclosure statement by Nov. 12, 2014. The initial case conference is due by Aug. 13, 2014. The meeting of creditors under 11 U.S.C. Sec. 341(a) is slated for Aug. 19, 2014. The case is assigned to Judge Shelley C. Chapman. J. Ted Donovan, Esq., at Goldberg Weprin Finkel Goldstein LLP, in New York, serves as counsel to the Debtor. DAB Group said in a court filing that its property is continguous to the commercial property owned by its affiliate, 77-79 Rivington Street Realty LLC (Bankr. S.D.N.Y. Case No. 14-10339). Accordingly, DAB's Chapter 11 case is being filed as a related proceeding. D.A.B. GROUP: Files Schedules of Assets and Liabilities ------------------------------------------------------- D.A.B. Group LLC filed together with its bankruptcy petition schedules that indicate that its property improved by an unfinished 16-story Allen Street Hotel in New York is worth $37.5 million, which is two times its existing debt to creditors: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $37,500,000 B. Personal Property $0 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $14,960,251 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $3,886,491 ----------- ----------- TOTAL $37,500,000 $18,846,743 The Debtor says that the property, located at 19-141 Orchard Street, New York, NY 10002, serves as collateral to a $14,000,000 debt to Orchard Hotel LLC. The secured lender can be reached at: ORCHARD HOTEL LLC c/o Maverick Real Estate Partners 14 E. 38th Street, 12th Floor New York, NY 10016. About DAB Group D.A.B. Group LLC, owner of a stalled 16-story Allen Street Hotel project in Orchard Street, New York, sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 14-12057) in Manhattan on July 14, 2014, to pursue a prompt sale of the property. The property has been in the hands of a receiver since July 18, 2011. Simon J.K. Miller, of Blank Rome LLP, serves as receiver. The Debtor is required to file its Chapter 11 plan and disclosure statement by Nov. 12, 2014. The initial case conference is due by Aug. 13, 2014. The meeting of creditors under 11 U.S.C. Sec. 341(a) is slated for Aug. 19, 2014. The case is assigned to Judge Shelley C. Chapman. J. Ted Donovan, Esq., at Goldberg Weprin Finkel Goldstein LLP, in New York, serves as counsel to the Debtor. DAB Group said in a court filing that its property is contiguous to the commercial property owned by its affiliate, 77-79 Rivington Street Realty LLC (Bankr. S.D.N.Y. Case No. 14-10339). Accordingly, DAB's Chapter 11 case is being filed as a related proceeding. DETROIT, MI: Mayor Mike Duggan's Pledges Echo in City's North End ----------------------------------------------------------------- John Eligon, writing for The New York Times, reported that Detroit's North End captures both the hope and challenge of Mayor Mike Duggan's promise of immediate improvements after the city hit a low point last year, becoming America's largest to file for bankruptcy. According to the NY Times, the North End, which became a haven for the upper class, still has some of the city's glorious homes although its remaining residents are mostly low- income blacks who bear the brunt of Detroit's economic decline because of a legacy of confinement to the lowest-paid, least- skilled and least-mobile jobs. In a plan for the first phase of a streetcar project, the neighborhood is the end of the line, the news agency said. The city is offering financial incentives for employees of Wayne State University and two nearby hospitals to rent or purchase homes in parts of the North End, the NY Times added. Moreover, the news agency noted that new people and also organizations are moving in, like the Michigan Urban Farming Initiative. Meanwhile, Law360 reported that individual creditors took aim at Detroit's design to exit Chapter 9, with one pension holder contending that the city's proposed plan of adjustment can't be confirmed because it runs afoul of the Michigan Constitution. According to Law360, Detroit's adjustment plan drew fire from four individual creditors, who filed separate objections in the U.S. Bankruptcy Court for the Eastern District of Michigan. 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. DIAMOND TECHNOLOGY: Posts $154K Net Loss in April 30 Quarter ------------------------------------------------------------ Diamond Technology Enterprises Inc. filed its quarterly report on Form 10-Q disclosing a net loss of $154,484 for the three months ended April 30, 2014, compared with a net loss of $46,265 for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $1.68 million in total assets, $560,124 in total liabilities, and a stockholders' deficit of $1.17 million. The Company has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future. In addition, the Company will require additional financing to fund future operations. The Company intends to raise additional capital to complete the development and commercialization of its current product through equity or debt financing; however the Company does not have any commitments or definitive or binding arrangements for such funds. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to the Company. If the Company is unsuccessful in raising additional capital it will need to reduce costs and operations substantially. These factors raise substantial doubt as to the Company's ability to continue as a going concern, according to the regulatory filing. A copy of the Form 10-Q is available at: http://is.gd/DwNRVI Diamond Technology Enterprises Inc. engages in the manufacture and supply of multicolored melee diamonds to the jewelry industry. The company was founded in 2013 and is headquartered in New York, New York. DIVERSIFIED RESOURCES: Posts $406K Net Loss in April 30 Quarter --------------------------------------------------------------- Diversified Resources, Inc., filed its quarterly report on Form 10-Q, disclosing a net loss of $406,155 on $9,874 of oil and gas sales for the three months ended April 30, 2014, compared with a net loss of $140,414 on $11,481 of oil and gas sales for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $2.83 million in total assets, $1.09 million in total liabilities, and stockholders' equity of $1.74 million. The Company sustained operating losses during the years ended Oct. 31, 2013 and 2012 and during the six months ended April 30, 2014 and 2013. The Company has a negative working capital in the amount of $611,487. The Company's continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations and/or obtaining additional financing from its shareholders or other sources, as may be required. A copy of the Form 10-Q is available at: http://is.gd/KmiCop Diversified Resources is a Colorado-based energy company focused on the development of its D-J Basin, Raton Basin and other assets. Those assets include leases in the counties of Weld, Adams, Broomfield and Las Animas Counties, Colorado. ENERGY FUTURE: Wants Separate 401(k) Plan for Oncor Employees ------------------------------------------------------------- Energy Future Holdings Corp. is seeking court approval to transfer to a new 401(k) plan the accounts of Oncor Electric Delivery Holdings Co.'s employees who participate in the energy company's own pension plan. The new 401(k) plan will be established by Oncor, an affiliate of Energy Future which is not in bankruptcy protection. The new plan, if approved by the court, would help reduce administrative burden on the part of Energy Future, according to its lawyer, Tyler Semmelman, Esq., at Richards, Layton & Finger P.A., in Wilmington, Delaware. About 4,000 current and former employees of Oncor participate in Energy Future's 401(k) plan. Approximately $626 million or 40% of the assets in the plan are attributable to these employees. Energy Future pays the costs of administering benefits on behalf of Oncor employees who participate in its pension plan. Oncor then reimburses the energy company on a monthly basis for these costs. The U.S. Bankruptcy for the District of Delaware will hold a hearing on July 18 to consider approval of the request. About Energy Future Holdings fka TXU Corp. Energy Future Holdings Corp., formerly known as TXU Corp., is a privately held diversified energy holding company with a portfolio of competitive and regulated energy businesses in Texas. Oncor, an 80 percent-owned entity within the EFH group, is the largest regulated transmission and distribution utility in Texas. The Company delivers electricity to roughly three million delivery points in and around Dallas-Fort Worth. EFH Corp. was created in October 2007 in a $45 billion leverage buyout of Texas power company TXU in a deal led by private-equity companies Kohlberg Kravis Roberts & Co. and TPG Inc. On April 29, 2014, Energy Future Holdings and 70 affiliated companies sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 14-10979) after reaching a deal with some key financial stakeholders to keep its businesses operating while reducing its roughly $40 billion in debt. The Debtors' cases have been assigned to Judge Christopher S. Sontchi (CSS). The Debtors are seeking to have their cases jointly administered for procedural purposes. As of Dec. 31, 2013, EFH Corp. reported total assets of $36.4 billion in book value and total liabilities of $49.7 billion. The Debtors have $42 billion of funded indebtedness. EFH's legal advisor for the Chapter 11 proceedings is Kirkland & Ellis LLP, its financial advisor is Evercore Partners and its restructuring advisor is Alvarez & Marsal. The TCEH first lien lenders supporting the restructuring agreement are represented by Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor, and Millstein & Co., LLC, as financial advisor. The EFIH unsecured creditors supporting the restructuring agreement are represented by Akin Gump Strauss Hauer & Feld LLP, as legal advisor, and Centerview Partners, as financial advisor. The EFH equity holders supporting the restructuring agreement are represented by Wachtell, Lipton, Rosen & Katz, as legal advisor, and Blackstone Advisory Partners LP, as financial advisor. Epiq Systems is the claims agent. Wilmington Savings Fund Society, FSB, the successor trustee for the second-lien noteholders owed about $1.6 billion, is represented by Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A. Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq., Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey, Esq., and Howard L. Siegel, Esq. An Official Committee of Unsecured Creditors has been appointed in the case. The Committee represents the interests of the unsecured creditors of ONLY of Energy Future Competitive Holdings Company LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings Company LLC; and EFH Corporate Services Company, and of no other debtors. The Committee has selected Morrison & Foerster LLP and Polsinelli PC for representation in this high-profile energy restructuring. The lawyers working on the case are James M. Peck, Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K. Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at Polsinelli PC. EXIDE TECHNOLOGIES: Seeks $65M In Additional Bankruptcy Financing ----------------------------------------------------------------- Law360 reported that battery maker Exide Technologies Inc. asked the Delaware bankruptcy court to approve $65 million in additional debtor-in-possession financing to bridge its way through negotiations on a Chapter 11 plan connected to a reorganization proposal the debtor received from a group of noteholders in late June. According to the Law360 report, in a motion before the bankruptcy court, Exide said that the nonbinding restructuring proposal it got from the unofficial committee of senior secured noteholders, which also holds the majority of the debtor's $500 million DIP financing package. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that Exide has said the inability to operate the recycling plant in Vernon, California, eroded earnings by $15 million to $38 million a year and the company said it needs additional financing until a substitute, lower-cost source can be located. The bankruptcy court in Delaware will hold a hearing on July 22 for approval of additional financing, Mr. Rochelle said. The $674 million of 8.625 percent first-lien notes due in 2018 traded on July 7 for 49 cents on the dollar, the Bloomberg report said, citing Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. About Exide Technologies Headquartered in Princeton, New Jersey, Exide Technologies (NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and distributes lead acid batteries and other related electrical energy storage products. Exide first sought Chapter 11 protection (Bankr. Del. Case No. 02-11125) on April 14, 2002 and exited bankruptcy two years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP represented the Debtors in their successful restructuring. Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 13-11482) on June 10, 2013. Exide disclosed $1.89 billion in assets and $1.14 billion in liabilities as of March 31, 2013. Exide's international operations were not included in the filing and will continue their business operations without supervision from the U.S. courts. For the new case, Exide has tapped Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial advisor; Sitrick and Company Inc. as public relations consultant and GCG as claims agent. Schnader Harrison Segal & Lewis LLP was tapped as special counsel. The Official Committee of Unsecured Creditors is represented by Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as co-counsel. Zolfo Cooper, LLC serves as its bankruptcy consultants and financial advisors. Geosyntec Consultants was tapped as environmental consultants to the Committee. Robert J. Keach of the law firm Bernstein Shur as fee examiner has been appointed as fee examiner. He has hired his own firm as counsel. F&H ACQUISITION: Has Until August 13 to Decide on Leases -------------------------------------------------------- U.S. Bankruptcy Judge Kevin Gross has given F&H Acquisition Corp. and its affiliated debtors until August 13 to either assume or reject their leases of nonresidential real property. The previous deadline was July 14. The companies are party to approximately 80 retail leases and other nonresidential real property leases that have not yet been assumed or rejected. Judge Gross in February approved the sale of substantially all of F & H assets to Cerberus Business Finance, LLC. As part of the sale, some of the leases will be assigned to Cerberus. About F & H Acquisition Corp. Wichita, Kansas-based F & H Acquisition Corp., et al., owners of the Fox & Hound, Champps, and Bailey's Sports Grille casual dining restaurants, filed a Chapter 11 petition (Bankr. D. Del. Lead Case No. 13-13220) on Dec. 16, 2013, to quickly sell their assets. As of the bankruptcy filing, the Debtors have 101 restaurants located in 27 states and 6,000 employees. Sales decreased by approximately 9 percent over the past two years. The Debtors also experienced significant inflation in commodity prices, energy prices and labor costs. F&H estimated assets in excess of $100 million. According to a court filing, outstanding debt obligations total $119 million, including $68.4 million owing on a first-lien loan with General Electric Capital Corp. as agent. The $11.2 million second-lien obligation has Cerberus Business Finance LLC as agent. Unsecured trade suppliers and landlords are owed $11.2 million. F & H Acquisition Corp., disclosed $122,115,200 in assets and $122,579,631 in liabilities as of the Chapter 11 filing. The senior lenders are to provide $9.6 million in financing for the bankruptcy, with $3.5 million on an interim basis. The parent holding company, F&H Acquisition Corp., is based in Wichita, Kansas. The Debtors have tapped Adam Friedman, Esq., at Olshan Frome Wolosky LLP, in New York; and Robert S. Brady, Esq., Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, as counsel; Imperial Capital LLC as financial advisor; and Epiq Bankruptcy Solutions as claims and noticing agent. The U.S. Trustee has appointed seven members to an official committee of unsecured creditors. The Official Committee of Unsecured Creditors is represented by Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones, LLP, in Wilmington, Delaware; and Jeffrey N. Pomerantz, Esq., at Pachulski Stang Ziehl & Jones, LLP, in Los Angeles, California. FLETCHER INT'L: Bid to Disgorge and Compel Compliance Denied ------------------------------------------------------------ The Bankruptcy Court denied a disgorgement motion filed by Alphonse Fletcher, Jr., in the Chapter 11 case of Fletcher International, Ltd. The Court, in its findings and conclusions, said that, notwithstanding Fletcher's failure to comply with the Court's prior orders, nothing raised in the March 19, 2014 letter, the motion to compel compliance, the chart, or the disgorgement motion creates an issue of fact as to any conflicts the trustee or his professionals allegedly failed to disclose. Fletcher International, Ltd., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-12796) on June 29, 2012, in Manhattan. The Bermuda exempted company estimated assets and debts of $10 million to $50 million. The bankruptcy documents were signed by its president and director, Floyd Saunders. David R. Hurst, Esq., at Young Conaway Stargatt & Taylor, LLP, in New York, serves as counsel and Appleby (Bermuda) Limited serves as special Bermuda counsel. The Debtor disclosed $52,163,709 in assets and $22,997,848 in liabilities as of the Chapter 11 filing. Fletcher International Ltd. was managed by the investment firm of Alphonse "Buddy" Fletcher Jr. Fletcher Asset Management was founded in 1991. During its initial four years, FAM operated as a broker dealer trading various debt and equity securities and making long-term equity investments. Then, in 1995, FAM began creating and managing a family of private investment funds. The Debtor is a master fund in the Fletcher Fund structure. As a master fund, it engages in proprietary trading of various financial instruments, including complex, long-term, illiquid investments. The Debtor is directly owned by Fletcher Income Arbitrage Fund and Fletcher International Inc., which own roughly 83% and 17% of the Debtor's common shares, respectively. Arbitrage's direct parent entities are Fletcher Fixed Income Alpha Fund and FIA Leveraged Fund, both of which are incorporated in the Cayman Islands and are subject to liquidation proceedings in that jurisdiction, and which own roughly 76% and 22% of Arbitrage's common stock, respectively. The Debtor currently has a single subsidiary, The Aesop Fund Ltd. After filing for Chapter 11 protection, Fletcher immediately started a lawsuit in bankruptcy court to stop the involuntary bankruptcy in Bermuda. Judge Gerber at least temporarily halted liquidators appointed in the Cayman Islands from moving ahead with proceedings in Bermuda. The lawsuit to halt the Bermuda liquidation is Fletcher International Ltd. v. Fletcher Income Arbitrage Fund, 12-01740, in the same court. Richard J. Davis, Chapter 11 trustee appointed in the case, has hired Michael Luskin, Esq., Lucia T. Chapman, Esq., and Stephanie E. Hornung, Esq., at Luskin, Stern & Eisler LLP as his counsel. The Chapter 11 trustee filed a proposed liquidating Plan in November 2013. The disclosure statement was approved on Jan. 17, 2014. Judge Gerber has confirmed the Second Amended Plan of Liquidation late in March 2014. FONTAINEBLEAU LAS VEGAS: Trustee Strikes $83.3M Deal for Creditors ------------------------------------------------------------------ Joseph Checkler, writing for Daily Bankruptcy Review, reported that the trustee in charge of Jeffrey Soffer's failed Fontainebleau Las Vegas casino project has struck a settlement that would put more than $83 million of directors and officers insurance money into creditors' pockets. According to Law360, in a filing with U.S. Bankruptcy Court in Miami, lawyers for Chapter 7 Trustee Soneet R. Kapila said the settlement also removes $675 million in claims against the Fontainebleau estate. In exchange, lawsuits against Mr. Soffer and other Fontainebleau officers, which accused them of, among other things, providing "materially inaccurate" information to lenders and other parties, will be dropped, Law360 said. Under the settlement, the trustee will get $80 million from the insurance company and $3.3 million from individual directors and officers for distribution to creditors, Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported. The settlement will also waive more than $675 million in claims against the bankrupt estate. Court approval of the settlement as proposed would bar a pending lawsuit against Fontainebleau directors and officers filed by lenders on a term loan, Mr. Rochelle said. Law360 related that U.S. Bankruptcy Judge A. Jay Cristol said he approved much of the proposed settlement but did not approve of the settlement's attached order barring term lenders from seeking further prosecution. "A number of parties in interest have agreed to settle the claims of the term lenders, who are now awaiting trial in Las Vegas state court, without the consent of the term lenders," Law360 said, citing Judge Cristol as saying. "In this court's opinion, such a bar order seems unconstitutional . . . as a taking of property without due process of law. About Fontainebleau Las Vegas Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- was planned as a hotel-casino on property along the Las Vegas Strip. Its developer, Fontainebleau Las Vegas Holdings LLC and affiliates, filed for Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 09-21481) on June 9, 2009. Scott L Baena, Esq., at BilzinSumbergBaena Price & Axelrod LLP, represented the Debtors in their restructuring effort. Kurtzman Carson Consulting LLC served as the Debtors' claims agent. Attorneys at Genovese Joblove& Battista, P.A., and Fox Rothschild, LLP, represented the Official Committee of Unsecured Creditors. Fontainebleau Las Vegas LLC estimated more than $1 billion in assets and debts, while each of Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings LLC estimated less than $50,000 in assets. In February 2010, Icahn Enterprises L.P. acquired Fontainebleau for roughly $150 million. The bankruptcy case was subsequently converted to Chapter 7. Soneet R. Kapila has been named the trustee for the Chapter 7 case of Fontainebleau Las Vegas. FREE LANCE-STAR: DSP Seeks to Disband Committee ----------------------------------------------- DSP Acquisition, LLC filed a motion with the U.S. Bankruptcy Court seeking an order directing the United States Trustee for Region 4 to disband the Official Committee of Unsecured Creditors as it is no longer required for the adequate representation of creditors following the sale of substantially all of the Debtors' assets to DSP. DSP said the disbandment of the Committee pursuant to Sections 105 and 1102 of the Bankruptcy Code is necessary and appropriate. The Debtors recently sold substantially all of their property to DSP. Following the Closing Date, the Debtors have no ongoing business operations and no remaining sources of income, and the Debtors' only remaining assets are potential causes of action. Furthermore, two of the three members of the Committee are no longer creditors in the bankruptcy case following the Closing Date and the subsequent withdrawal of their claims, and the sole remaining member of the Committee (the PBGC) is separately represented in the case. It is beyond cavil that a committee with only one member is not permissible. Indeed, the United States Trustee Manual expressly states that "[t]he United States Trustee should not ordinarily appoint a committee of two members and should never appoint a committee of one." DSP also said the Committee is no longer needed to represent the interests of its sole remaining member, and the continuing accrual of duplicative fees and expenses by the Committee is no longer justified, particularly since the fees and expenses are paid out of DSP's cash collateral and information obtained from the Debtors suggests that the remaining cash collateral is anticipated to be completely depleted during the third fiscal quarter of 2014. About The Free Lance-Star Publishing The Free Lance-Star Publishing Co. of Fredericksburg, Va., is a publishing, newspaper, radio and communications company based in Fredericksburg, Virginia and owned by the family of Josiah P. Rowe III. FLS's single, seven-day a week newspaper, The Free Lance- Star was first published in 1885 when a group of local Fredericksburg merchants and businessmen created the paper to serve the news and advertising needs of the community. FLS also owns radio stations WFLS-AM, FLS-FM, and WVBX. FLS owns the community and news portal http://www.fredericksburg.com/ FLS filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Case No. 14-30315) in Richmond, Virginia, on Jan. 23, 2014. William Douglas Properties, L.L.C., a related entity that owns a portion of the land pursuant to which FLS operates certain aspects of its business, also sought bankruptcy protection. Judge Keith L. Phillips was initially assigned to the cases, but the cases were reassigned to Judge Kevin R. Huennekens on the Petition Date. The Debtors have tapped Lynn L. Tavenner, Esq., and Paula S. Beran, Esq., at Tavenner & Beran, PLC, as counsel; and Protiviti, Inc., as financial advisor. Judge A. Robbins, U.S. Trustee for Region 4, appointed three members to the official committee of unsecured creditors. FREE LANCE-STAR: Wants Case Caption Changed to "VA NEWSPAPER" ------------------------------------------------------------- The Free Lance-Star Publishing Co. filed a motion with the U.S. Bankruptcy Court seeking authorizion to change the caption of the Debtors' jointly administered cases. The changes will be: VA NEWSPAPER DEBTOR CO., et al. Case No. 14-30315-KRH (Jointly Administered) In addition, the Debtors request that the Court authorize the Clerk of the Bankruptcy Court for the Eastern District of Virginia and other parties in interest to take whatever actions are necessary to update the ECF filing system and their respective records to reflect the name changes of the Debtors identified. The Debtors also request that a docket entry, substantially similar to the following, be entered on the docket of William Douglas Properties, LLC: "An order has been entered changing the caption of the lead case in these jointly administered cases to In re VA Newspaper Debtor Co., et al., Case No. 14-30315-KRH. As a result of recent changes or anticipated changes to the names of the Debtors, the current or anticipated new names of the Debtors, and the Debtors' names before the name changes, are as follows: VA Newspaper Debtor Co. (f/k/a The Free Lance-Star Publishing Co. of Fredericksburg, VA) and VA Real Estate Debtor LLC (f/k/a/ William Douglas Properties, LLC)." The requested change to the caption is necessary as a result of the closing of the Sale pursuant to the Sale Order. As a result, the Debtors seek to change the caption of the Debtors' jointly administered cases to accurately reflect the contemplated changes in their names and to avoid any confusion. About The Free Lance-Star Publishing The Free Lance-Star Publishing Co. of Fredericksburg, Va., is a publishing, newspaper, radio and communications company based in Fredericksburg, Virginia and owned by the family of Josiah P. Rowe III. FLS's single, seven-day a week newspaper, The Free Lance- Star was first published in 1885 when a group of local Fredericksburg merchants and businessmen created the paper to serve the news and advertising needs of the community. FLS also owns radio stations WFLS-AM, FLS-FM, and WVBX. FLS owns the community and news portal http://www.fredericksburg.com/ FLS filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Case No. 14-30315) in Richmond, Virginia, on Jan. 23, 2014. William Douglas Properties, L.L.C., a related entity that owns a portion of the land pursuant to which FLS operates certain aspects of its business, also sought bankruptcy protection. Judge Keith L. Phillips was initially assigned to the cases, but the cases were reassigned to Judge Kevin R. Huennekens on the Petition Date. The Debtors have tapped Lynn L. Tavenner, Esq., and Paula S. Beran, Esq., at Tavenner & Beran, PLC, as counsel; and Protiviti, Inc., as financial advisor. Judge A. Robbins, U.S. Trustee for Region 4, appointed three members to the official committee of unsecured creditors. GABRIEL TECHNOLOGIES: Court OKs Case Conversion to Chapter 7 ------------------------------------------------------------ The U.S. Bankruptcy Court approved the motion filed by Qualcomm Incorporated, a creditor of Gabriel Technologies Corporation, et al., to convert the Debtor's chapter 11 case to a liquidation in chapter 7. About Gabriel Technologies Gabriel Technologies Corporation and one subsidiary filed separate Chapter 11 petitions (Bankr. N.D. Cal. Case No. 13-30340 and 13- 30341) on Feb. 14, 2013, in San Francisco, after losing in a patent dispute with smartphone chips maker Qualcomm Inc. Gabriel Technologies, through its debtor-subsidiary Trace Technologies, LLC, holds significant intellectual property assets directed toward location-based products and services through global positioning systems. Gabriel Technologies disclosed $15 million in assets and $15 million in liabilities as of Jan. 31, 2013. The Debtors tapped the law firm of Meyers Law Group, P.C. as general bankruptcy counsel. A three-member official committee of unsecured creditors has been appointed in the case. Pachulski Stang Ziehl & Jones LLP represents the Committee. The Debtor filed a Plan of Reorganization that proposes to substantively consolidate the Debtors' estates into the Chapter 11 estate of Gabriel, and upon the Effective Date, all those assets will become the property of the Reorganized Debtor. Secured claims filed against the Debtors will be paid by proceeds recovered from Qualcomm Incorporated in a lawsuit involving royalties, and from another lawsuit involving royalties captioned Gabriel Technologies Corporation, etc. v. Keith Feilmeier, et al. Unsecured Claims will also be paid from the proceeds of the two lawsuits, after all secured claims have been paid. Allowed General unsecured claims will accrue an interest of 10% per annum. GBG RANCH: Files Notice to Remove State Court Suit -------------------------------------------------- G.B.G. Ranch, Ltd., filed with the U.S. Bankruptcy Court for the Southern District of Texas, Lareo Division, a notice of removal of the state court litigation styled Anam Ltd., Guillermo Benavides Z. and Guillermo R. Benavides v. G.B.G. Ranch, Ltd., pending in the 49th Judicial District Court of Webb County, in Texas, under Cause No. 2011-CVF-0001994-D1. According to the Debtor, the removed litigation involves both "core" and "non-core" claims and causes of action between the Debtor and the various parties. GBG Ranch, LTD, a Texas Limited Partnership, sought Chapter 11 protection (Bankr. S.D. Tex. Case No. 14-50155) in Laredo, Texas on July 8, 2014, without stating a reason. The company estimated assets of $50 million to $100 million and debt of less than $10 million. The company is represented by the Law Office of Carl M. Barto. GENERAL MOTORS: Top Lawyer Faces Scrutiny on Defect, Settlements ---------------------------------------------------------------- Jeff Bennett, Joseph B. White and Siobhan Hughes, writing for The Wall Street Journal, reported that senators pressing General Motors Co. on why senior executives weren't aware of defective cars turn their sights to the auto maker's top lawyer whose staff signed off on wrongful-death payouts that pointed to the fatal flaw. According to the report, GM General Counsel Michael Millikin, a 37-year company veteran, has come under deeper scrutiny in recent months as the recall ballooned into a financial and public-relations nightmare. He has said underlings kept him in the dark about settlements that cost the auto maker millions of dollars and exposed the safety defects, the Journal related. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. GLOBAL GEOPHYSICAL: Approved to Pay or Advance Defense Cost ----------------------------------------------------------- The Bankruptcy Court authorized Global Geophysical Services Inc., et al., to pay or advance defense costs under the Debtors' directors and officers liability insurance policies. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that the Debtors' current and former officers and directors asked the bankruptcy judge to give them access to the directors' and officers' insurance to pay their expenses in defending lawsuits and an investigation by the Securities and Exchange Commission. According to the Bloomberg News report, citing court papers, the provider of seismic data for the oil and gas drilling industry has $25 million in D&O policies. Executives of the Missouri City, Texas-based company said that the insurer with the primary policy has agreed to advance defense costs and that Global doesn't object to their request, the report related. Pursuant to the Court's Order, the insurers are authorized to pay or advance defense costs of the Global insured parties that have been or will be incurred in connection with the pending federal lawsuit, any other shareholder lawsuits arising from or relating to the facts set forth in the Miller action, the SEC inquiry, and any other investigative or enforcement proceedings relating to the Securities and Exchange Commission inquiry. Payments of defense cost will be paid directly to Global Insured Parties counsel -- Fulbright & Jaworski LLP and Naker & Hosteler LLP -- and any experts, consultants and vendors retained in the Identified Actions. In a separate filing, the Court authorized the Debtors to form, register and dissolve non-debtor subsidiaries. The Court overruled the objections. 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. GLOBAL GEOPHYSICAL: July 22 Hearing on Cardno Entrix Agreement -------------------------------------------------------------- The Bankruptcy Court will convene a hearing on July 22, 2014, at 10:00 a.m., to consider Global Geophysical Services, Inc., et al.'s motion for authorization to enter into a stipulation with Cardno Entrix. According to the Debtors, prior to the commencement of the cases, Wolf Exploration, L.P., hired Global to perform seismic services in Sheridan and Roosevelt Counties, Montana (the Fort Peck Area). Global agreed to assist Wolf in obtaining the necessary permits to drill in the Fort Peck Area. The Fort Perk Area is home to the Fort Peck Assiniboine & Sioux Tribes (the Tribes). As a result, Global was required to obtain the necessary drilling permits from the Bureau of Indian Affairs well as the Tribes. Global was also required to meet certain standards under the National Environmental Policy Act. To obtain the drilling permits and to comply with NEPA standards, Global was required to locate and identify culturally sensitive areas (e.g., burial grounds) so that Wolf's eventual drilling would not disturb such areas. Accordingly, Global and Cardno Entrix entered into the master agreement for contractor services and the supplement No. 1 to the master agreement for contract services effective April 30, 2013, whereby Cardno agreed to provide archaeological and NEPA services in the Fort Peck Area. Under the Contractor Services Agreement, Cardno agreed to perform a Class III Cultural Resource Inventory on approximately 268 culturally sensitive areas as part of the Fort Peck Reservation Seismic Project. The inventory was to include services as conducting field activities to identify the locations, categorizing the nature of any cultural sensitivity, photographing the locations, logging coordinates of the locations, preparing non-disturbance mitigation recommendations, and providing a report to Global containing all of the foregoing. Cardno originally estimated $540,730 as the cost to complete the Fort Peck Reservation Seismic Project. On Jan. 10, 2014, Cardno advised that the initial $540,730 estimate fell short of the anticipated amount required to complete the Fort Peck Reservation Seismic Project. The parties agreed that Global would pay an additional $175,000 to complete the reporting phase of the Fort Peck Reservation Seismic Project. Cardno ceased performing services when the Debtor filed a Chapter 11 petition and Cardno has not completed the report, the BIA and Tribes have not issued the drilling permits to Global's customer, Wolf. After a series of negotiations, the parties agreed to resolve their dispute by agreeing to these terms: 1. Cardno will perform various tasks to complete the reporting phase of the Fort Peck Reservation Seismic Project; 2. Global will make certain payments after Cardno achieves certain milestones by specified dates and submits the required invoice; 3. the payment from Global for each task is due within 5 days of Global's receipt of the invoices corresponding to the particular task; provided, however, that no payment from Global will be due if Global has not received the work product associated with the particular task; 4. the total payments to be made from Global to Cardno pursuant to the stipulation will not exceed $103,657; and 5. the report that Cardno will complete will contain all necessary information for each of the 250 Locations, including the inventory map with all locations appropriately located and annotated. 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. GLOBAL GEOPHYSICAL: July 22 Hearing on Bid to Pay Colombian Taxes ----------------------------------------------------------------- The Bankruptcy Court will convene a hearing on July 22, 2014, at 10:00 a.m., to consider Global Geophysical Services Inc., et al.'s motion for authorization to make certain tax payments to the Colombian taxing authorities. The Debtors, in their motion, stated that in furtherance of the cross-border nature of their cases, and to comply with applicable U.S. and Colombian law, the Debtors intend to pay certain prepetition taxes owed to certain Colombian taxing authorities, prior to confirmation of any plan of reorganization. The Debtors are represented by: Omar Alaniz, Esq. Ian E. Roberts, Esq. C. Luckey McDowell, Esq. BAKER BOTTS L.L.P. 2001 Ross Avenue Dallas, TX 75201 Tel: (214) 953-6500 Fax: (214) 953-6503 E-mails: luckey.mcdowell@bakerbotts.com omar.alaniz@bakerbotts.com ian.roberts@bakerbotts.com - and - Shelby A. Jordan, Esq. Nathaniel Peter Holzer, Esq. JORDAN, HYDEN, WOMBLE, CULBRETH & HOLZER, P.C. Suite 900, Bank of America 500 North Shoreline Corpus Christi, TX 78471 Tel: (361) 884-5678 Fax: (361) 888-5555 E-mails: sjordan@jhwclaw.com pholzer@jhwclaw.com 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. GLOBAL GEOPHYSICAL: Needs 60 Days to Propose a Plan --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Global Geophysical Services Inc., a provider of seismic data for the oil and gas drilling industry, filed a motion seeking extension of its exclusive plan filing period, saying it needs two more months to formulate a Chapter 11 plan. According to the report, if the so-called exclusivity motion is granted at a July 22 hearing, the new plan-filing deadline will be Sept. 24. The company's bankruptcy lenders and the creditors' committee support the 60-day extension, Mr. Rochelle said, citing Global. 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. GOLDKING HOLDINGS: Scheduled for Aug. 18 Confirmation Hearing ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Goldking Holdings LLC, an independent oil and gas exploration and production company with 35 wells in Texas and 12 in Louisiana, can solicit votes on its Chapter 11 reorganization plan after winning approval of explanatory disclosure materials. According to the report, after emerging from bankruptcy, Houston- based Goldking will be owned by Wayzata Opportunities Fund II LP, which is the current 94% equity owner and secured lender, in exchange for debt financing the Chapter 11 effort. The company requested expedited approval of the disclosure statement, saying it elected not to proceed with a sale of the business and is "poised to emerge" from bankruptcy to continue development of its oil and gas assets, the report related. About Goldking Holdings Goldking Holdings LLC, an oil-and-gas exploration company based in Houston, sought bankruptcy protection (Bankr. D. Del. Case No. 13-12820) in Wilmington, Delaware, on Oct. 30, 2013, from creditors with plans to sell virtually all its assets. Goldking Onshore Operating, LLC, and Goldking Resources, LLC, also sought creditor protection. The cases were initially assigned to Delaware Judge Brendan Linehan Shannon. On Nov. 20, 2013, Judge Shannon granted the request of Goldking's former CEO Leonard C. Tallerine Jr. and Goldking Capital LT Corp., to move the Chapter 11 case to Houston, Texas (Bankr. S.D. Tex. Case No. 13-37200). Mr. Tallerine owns a nearly 6% stake in the company through an entity called Goldking LT Capital Corp. The Debtors are represented by Scott W. Everett, Esq., and Christopher L. Castillo, Esq., at Haynes and Boone, LLP. Edmon L. Morton, Esq., and Robert F. Poppiti, Jr., Esq., at Young, Conaway, Stargatt & Taylor, LLP, in Wilmington, Delaware, serve as the Debtors' co-counsel. The Debtors' notice, claims, solicitation and balloting agent is Epiq Bankruptcy Solutions, LLC. Lantana Oil & Gas Partners was initially hired as the Debtors' financial advisors. In December 2013, the Debtors won Court approval to employ E-Spectrum Advisors LLC, led by its CEO Coy Gallatin, as asset sale advisor. Alvarez & Marsal Global Forensic and Dispute Services, LLC, has been engaged to provide computer forensics and related services. Goldking Holdings disclosed $16,170 in assets and $11,484,881 in liabilities as of the Chapter 11 filing. Judy A. Robbins, United States Trustee for the Southern District of Texas, appointed a three-member official committee of unsecured creditors. The Committee filed papers to retain Brinkman Portillo Ronk, APC, as counsel, and Okin & Adams LLP as local counsel. HANESBRANDS INC: Moody's Affirms 'Ba1' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed Hanesbrands Inc.'s Corporate Family Rating at Ba1 and the company's Probability of Default Rating at Ba1-PD. Moody's also downgraded the rating on the company's $1.1 billion senior secured revolver due 2018 to Baa3 from Baa2 and assigned a Baa3 rating to the new Euro term loan due 2021. The company's rating outlook remains stable. Proceeds from the new Euro term loan (expected to be the Euro equivalent of US$ 500 million) will be primarily used to fund a portion of the EUR400 million acquisition price of DB Apparel announced in June 2014. The loan will be an obligation of a foreign subsidiary of Hanesbrands, and will also benefit from the same guarantee and security structure as the company's $1.1 billion senior secured revolver. The downgrade of the senior secured revolver rating to Baa3 from Baa2 reflects dilution of the secured revolver's interest in its collateral as the obligations under the new Euro term loan will be secured pari-passu. The Baa3 rating on the Euro term loan reflects that it shares a pari-passu collateral interest with the senior secured revolver. The Euro term loan also benefits from a modest degree of structural seniority relative to the revolver with respect to a portion of Hanesbrands' international assets since the revolver is not guaranteed by MFB. While this is a positive, Moody's does not believe the incremental structure benefits are sufficient to warrant a rating differential between the secured revolver and the Euro term loan. The following ratings were affirmed: Hanesbrands Inc. Corporate Family Rating at Ba1 Probability of Default Rating at Ba1-PD Speculative-Grade Liquidity rating at SGL-2 $1 billion senior unsecured notes due 2020 at Ba2, LGD5 The following rating was downgraded: Hanesbrands Inc. $1.1 billion senior secured revolver due 2018 to Baa3, LGD2 from Baa2, LGD2 The following rating was assigned: MFB International Holdings S.a.r.l (MFB) Euro term loan due 2021 at Baa3, LGD2 Rating Outlook is Stable for Hanesbrands Inc. and MFB International Holdings S.a.r.l Ratings Rationale Hanesbrands Ba1 Corporate Family Rating reflects the company's significant scale in the global apparel industry -- pro forma revenue including the acquisition of Maidenform and DB Apparel is expected to approach $6 billion -- along with the company's well known brands and leading share in the inner wear product category. Also considered is the company's relatively modest leverage and strong interest coverage. Debt/EBITDA was only 3.2 times and interest coverage was 4.7 times for the latest 12-month period ended March 29, 2014. Moody's expects only a modest and temporary increase in leverage following the DB Apparel acquisition, and leverage will approach 3 times by the end of 2014. Other favorable credit considerations include Hanesbrands' double digit operating margins that are a result of product innovation, a low cost supply chain, and the company's ability to successfully leverage its brands. Key concerns include Hanesbrands' significant customer concentration -- three of the company's largest customers currently account for more than 50% of its 2013 revenues -- and its exposure to volatile input costs, such as cotton, which can have a meaningful and unfavorable impact on earnings and cash flows. The ratings also incorporate expectations the company is likely to remain acquisitive as evidenced by its recent history. The stable rating outlook reflects Moody's expectation that Hanesbrands will be able to sustain its high operating margins and that it will continue to make progress achieving cost savings associated with the Maidenform acquisition that occurred in October 2013 and the DB Apparel acquisition, which is expected to close as soon as the third quarter of 2014 . The stable rating outlook does not anticipate a further material reduction in leverage given Moody's view that the company will use its free cash flow to fund acquisitions and/or share repurchases as opposed to debt repayment. Further rating improvement is limited by the significant amount of secured debt in Hanesbrands' capital structure, and by the company's current financial policy that Moody's believes targets credit metrics at a level too high for an investment grade rating. A higher rating would require that Hanesbrands demonstrate the ability and willingness to maintain debt/EBITDA below 3.0 times as well as materially reduce its reliance on secured financing. Ratings could be lowered if the company experienced market share losses or brand erosion that resulted in negative trends in revenues or operating earnings. Ratings could also be lowered if Hanesbrands were to use debt more aggressively than it has in the past to fund large acquisitions, or if the company were to make share repurchases in an amount materially above free cash flow. Quantitatively, ratings could be lowered if, for any reason, it appears that debt/EBITDA will rise to and remain at or above 3.75 times for an extended period of time. Headquartered in Winston-Salem, NC, Hanesbrands is a manufacturer and distributor of basic apparel products under brands that include Hanes, Champion, Playtex, Bali, L'Eggs, Maidenform and Just My Size. Annual revenues are expected to approach $6 billion pro-formal for the acquisitions of Maidenform and DB Apparel. HANESBRANDS INC: S&P Retains 'BB' Corp. Credit Rating ----------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BBB-' rating to North Carolina-based Hanesbrands Inc.'s proposed EUR362.3 million secured term loan due 2021. The borrower will be MFB International Holdings S.a.r.l., a wholly-owned subsidiary of Hanesbrands, and Hanesbrands will be a guarantor. The recovery rating on the secured the term loan is '1', indicating S&P's expectation for very high (90%-100%) recovery in the event of a default. The 'BB' corporate credit rating and 'BB' unsecured debt ratings remain unchanged. The outlook is stable. "We expect the company to use the proceeds from the term loan to finance its pending roughly $550 million acquisition of DBA Lux Holdings S.A, a European intimate apparel and underwear company. We believe the addition of DBA Lux will be complimentary to Hanesbrands' existing businesses and expand its international platform. However, given the relatively modest size of the business, we do not believe it will materially change the company's business risk profile," S&P said. "While we estimate pro forma leverage will increase modestly to the low- to mid-3x area (compared with 3.1x for the 12 months ended March 31, 2014) upon consummation of the acquisition, we expect pro forma leverage to decline to the 3x area by the end of 2014. In particular, we believe the company will reduce debt levels in the second half of 2014 with cash flow from operations, as it has done historically over the past several years. We anticipate the acquisition transaction will be completed during third quarter 2014," S&P added. The ratings on Hanesbrands reflect the company's good operating cash flow and S&P's expectation for credit metrics to remain in line with its indicative ratios for a "significant" financial risk profile, including leverage in the 3x to 4x range. Also, S&P believes the company's business risk profile continues to be "fair," reflecting its view the company will maintain its good market position and operating scale in the highly competitive apparel sector and the commodity-like nature of some of its products. RATINGS LIST Hanesbrands Inc. Corporate credit rating BB/Stable/-- New Ratings MFB International Holdings S.a.r.l. Senior secured EUR362.3 million term loan due 2021 BBB- Recovery rating 1 HDGM ADVISORY: Judge Adjourns Motion to Convert Case Indefinitely ----------------------------------------------------------------- U.S. Bankruptcy Judge James Carr has issued an order adjourning indefinitely the motion to appoint a bankruptcy trustee in HDGM Advisory Services LLC's Chapter 11 case and the motion to convert the case to a Chapter 7 liquidation. Both motions were filed by GPIF-I Equity Co., LTD and GPIF-I Finance Co., LTD. In their motion to appoint a bankruptcy trustee, the funds cited HDGM's questionable conduct before its collapse as basis for the appointment. The funds alleged that the company resorted to bankruptcy filing to derail their effort to pursue their claims. Meanwhile, the funds argued that converting HDGM's bankruptcy case to a Chapter 7 liquidation is the most appropriate option since the company has no prospect of rehabilitation. About HDGM Advisory Services HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 14-04797 and 14-04798) in Indianapolis, Indiana, on May 21, 2014. On May 28, 2014, the Hon. James M. Carr directed the joint administration the cases of HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc., under the lead case -- HDGM Advisory, Case No. 14-04797. HDGH Advisory disclosed $20,257,001 in assets and $7,991, 590 in liabilities as of the Chapter 11 filing. HDG Mansur disclosed $20,454,819 in assets and $12,377,542 in liabilities. According to a court filing, the Debtors don't have any secured creditors. The cases are assigned to Judge James M. Carr. The Debtors have tapped Michael W. Hile, Esq., Christine K. Jacobson, Esq., and Henry Mestetsky, Esq., at Katz & Korin PC, as counsel. According to the docket, the deadline for governmental entities to file claims is on Nov. 17, 2014. An affiliate of the Debtors, Hamilton Proper Partners Golf Partnership, L.P., sought bankruptcy protection (Bankr. S.D. Ind. Case NO. 14-00461) on Jan. 24, 2014. HDGM ADVISORY: Hearing on Trustee Motion Adjourned Indefinitely --------------------------------------------------------------- Bankruptcy Judge James M. Carr adjourned indefinitely, the hearing to consider the motion filed by GPIF-I Equity Co., Ltd. and GPIF-I Finance Co., Ltd., for appointment of a Chapter 11 trustee in HDGM Advisory Services, LLC's bankruptcy case. The adjournment is subject to the Funds' ability to renew the trustee motions (a) based on any breach of the agreed entry or (b) in any event, after Sept. 30, 2014, and for all other just and appropriate relief. As reported in the Troubled Company Reporter on July 2, 2014, the Funds are real estate investments firms for which the Debtor acted as manager and the Debtor's principal, Harold Garrison, acted as CEO and chairman of the Board of Directors. The Funds sued the Debtor and Garrison in federal court alleging misappropriation of nearly $6 million. The Funds received a judgment of nearly $6.8 million prior to the date of the Debtor's Chapter 11 petition. Some additional related claims are still pending. A criminal investigation by the U.S. Attorney's office is also underway. The Funds contend that the Debtor has availed itself of bankruptcy protection to delay the Funds' ability to collect on their claims against the Debtor and Garrison. The Debtor has admitted to having minimal business operations and few assets. Since Garrison has not personally filed for bankruptcy, he is free to dispose of personal assets that could be subject to a judgment against him. The Funds contend that appointment of a trustee is warranted in the Debtor's case either (1) for "cause" under Sec. 1104(a) of the Bankruptcy Code, or (2) because the appointment is in the best interest of the estate and creditors under Sec. 1104(a)(2) of the Code. The Funds contend that cause exists based on the Debtor's prepetition conduct which included fraud, dishonesty, incompetence, and gross mismanagement. Additionally, the Funds contend that appointment of a trustee is in the best interests of the estate and creditors because the Debtor cannot be trusted to exercise its fiduciary duties to the estate and creditors. Alternatively, the Funds seek to have the case converted to Chapter 7 liquidation. GPIF-I Equity Company LTD and GPIF-I Finance Company LTD are represented by Thomas C. Scherer, Esq. and Whitney L. Mosley, Esq. at Bingham, Greenebaum, Doll, LLP of Indianapolis, Indiana. About HDGM Advisory Services HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 14-04797 and 14-04798) in Indianapolis, Indiana, on May 21, 2014. On May 28, 2014, the Hon. James M. Carr directed the joint administration the cases of HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc., under the lead case -- HDGM Advisory, Case No. 14-04797. HDGH Advisory disclosed $20,257,001 in assets and $7,991, 590 in liabilities as of the Chapter 11 filing. HDG Mansur disclosed $20,454,819 in assets and $12,377,542 in liabilities. According to a court filing, the Debtors don't have any secured creditors. The cases are assigned to Judge James M. Carr. The Debtors have tapped Michael W. Hile, Esq., Christine K. Jacobson, Esq., and Henry Mestetsky, Esq., at Katz & Korin PC, as counsel. According to the docket, the deadline for governmental entities to file claims is on Nov. 17, 2014. An affiliate of the Debtors, Hamilton Proper Partners Golf Partnership, L.P., sought bankruptcy protection (Bankr. S.D. Ind. Case NO. 14-00461) on Jan. 24, 2014. HEARING HELP EXPRESS: Case Summary & 20 Top Unsecured Creditors --------------------------------------------------------------- Debtor: Hearing Help Express, Inc. dba Hearing Help Express dba Hear Direct dba Simply Batteries dba Moolah by Mail dba Eco-Gold Batteries dba Eco-Gold Hearing Products dba Lotus Express 105 North 1st Street DeKalb, IL 60115 Case No.: 14-82161 Nature of Business: Health Care Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Northern District of Illinois (Rockford) Judge: Hon. Thomas M. Lynch Debtor's Counsel: James E Stevens, Esq. BARRICK, SWITZER, LONG, BALSLEY & VAN EVERA 6833 Stalter Drive Rockford, Il 61108 Tel: 815-962-6611 Fax: 815-962-1758 Email: jimstevens@bslbv.com jstevens@bslbv.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by James E. Hovis, CEO and chairman of the Board. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/ilnb14-82161.pdf HERITAGE PLACE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Heritage Place Gallery of Floors Inc. 105 Pleasant Drive Aliquippa, PA 15001 Case No.: 14-22837 Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Western District of Pennsylvania (Pittsburgh) Debtor's Counsel: Robert O Lampl, Esq. ROBERT O LAMPL, ATTORNEY AT LAW 960 Penn Avenue, Suite 1200 Pittsburgh, PA 15222 Tel: 412-392-0330 Fax: 412-392-0335 Email: rol@lampllaw.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Elaine K. Deluco, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/pawb14-22837.pdf HG SPEC: Chapter 15 Case Summary -------------------------------- Chapter 15 Petitioner: Jean Pichette Chapter 15 Debtor: HG Spec Inc. 1120, boul, Michele-Bohec Blainville, QC J7C 5N5 Canada Chapter 15 Case No.: 14-41502 Chapter 15 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Eastern District of Texas (Sherman) Chapter 15 Petitioner's Counsel: Charmaine A. Ferguson, Esq. SHEEHY, WARE & PAPPAS, P.C. 909 Fannin St., Ste. 2500 Houston, TX 77010 Tel: 713-951-1165 Fax: 713-951-1199 Email: cferguson@sheehyware.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $500,000 to $1 million HOYT TRANSPORTATION: Plan Filing Exclusivity Extended to Aug. 12 ---------------------------------------------------------------- Hoyt Transportation Corp. sought and obtained a third extension of its exclusivity period to file a Chapter 11 plan of reorganization and to solicit acceptances to that Plan. The extension would make the deadline for submitting a Plan of Reorganization on August 12, 2014 and the deadline for soliciting acceptances to the Plan on October 10, 2014. The Debtor said its request will allow time to resolve outstanding back-pay claims which arose from a new collective bargaining agreement which resulted from an industry-wide ruling by the National Labor Relations Board. About Hoyt Transportation Brooklyn, New York-based Hoyt Transportation Corp. filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 13-44299) on July 13, 2013, estimating at least $10 million in assets and liabilities. The Debtor is represented by Kevin J. Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP. Brooklyn-based Hoyt specializes in transportation for children with disabilities. Hoyt operated 350 buses until the contract with the Department of Education expired. IDAHO BANCORP: D.L. Evans Wins at Auction ----------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Idaho Bancorp received approval from the U.S. Bankruptcy Court in Boise, Idaho, to sell the bank subsidiary Idaho Banking Co. to D.L. Evans Bancorp. According to the report, as the the result of an auction, Idaho-based D.L. Evans will pay $10 million, almost four times the opening bid of $2.6 million bid from Banner Bank. D.L. Evans will assume the bank subsidiary's rights under a tax-sharing agreement. About Idaho Bancorp Idaho Bancorp -- http://www.idahobankingco.com-- is headquartered in Boise, Idaho, and is the parent company of Idaho Banking Company, a state-chartered commercial bank and member of the Federal Reserve System, which was organized in 1996 and operates four branch offices. At December 31, 2013, Idaho Banking Company had $100 million in assets, $62 million in loans and $96 million in deposits. The Company serves clients throughout southwestern Idaho. Idaho Bancorp filed a Chapter 11 bankruptcy petition (Bankr. D. Idaho Case No. 14-00662) on April 24, 2014. The case is assigned to Judge Terry L Myers. The Debtor has tapped Noah G. Hillen, Esq., in Boise, Idaho, as counsel. The Debtor scheduled $4.32 million in total assets and $7.23 million in liabilities. KILROY REALTY: Moody's Affirms 'Ba1' Preferred Stock Rating ----------------------------------------------------------- Moody's Investors Service affirmed Kilroy Realty Corporation's preferred stock rating at Ba1, and affirmed the issuer and senior unsecured debt rating of Kilroy Realty, L.P. at Baa3. The outlook was revised to positive from stable. Ratings Rationale The revised outlook reflects the continued positive operating momentum in Kilroy's core office markets. The outlook incorporates Moody's expectation that the REIT's credit metrics will continue to strengthen, specifically net debt to EBITDA and fixed charge coverage, as development projects are completed and delivered over the course of the next two years as outlined to Moody's. The current ratings reflect the REIT's strong operating performance and expanding market position along the West Coast, high quality unencumbered asset base and moderate effective leverage. These strengths are counterbalanced by the REIT's aggressive development growth strategy and material geographic concentration in its California sub-markets. Over the last several years, Kilroy Realty has enhanced the quality of its portfolio by expanding its geographic footprint into San Francisco and the greater Seattle market, in addition to selling lower-growth assets and re-deploying the capital into better assets with more upside. Kilroy's robust operating performance is reflected in its solid occupancy levels, 92% occupied as of 1Q14, as well as high-single digit NOI growth year over year. Moody's also notes that development is a core competency of the REIT with $1.5 billion under construction as of the end of the first quarter. Four of the six development projects are fully pre-leased to quality tenants under lease terms of 12 years or more, a plus. The ratings are further supported by the REIT's adequate liquidity profile. Kilroy recently amended its $500 million unsecured credit facility, extending the maturity date to July 2019. The company has $260 million and $395 million of debt coming due in 2014 and 2015, respectively. Debt maturities are manageable in Moody's view considering Kilroy's proven ability to access debt and equity capital. Upward rating movement would require net debt to EBITDA closer to 6.0x, effective leverage closer to 40%, fixed charge coverage closer to 3.0x with the prospect of sustainability, and maintenance of unencumbered assets of at least 70% of gross assets. A return to a stable outlook would be predicated upon difficulties in leasing or completing its current development pipeline. Downward pressure would also occur if net debt to EBITDA approaches 7.0x, fixed charge coverage falls below 2.5x, and secured debt rises to 20% or more of gross assets. The following ratings were affirmed with a positive outlook: Kilroy Realty Corporation -- preferred stock at Ba1 and preferred shelf at (P)Ba1 Kilroy Realty, L.P. -- senior unsecured debt at Baa3; senior unsecured debt shelf at (P)Baa3; senior subordinated shelf at (P)Ba1; subordinated shelf at (P)Ba1 The principal methodology used in this rating was Global Rating Methodology for REITs and Other Commercial Property Firms published in July 2010. Kilroy Realty Corporation [NYSE: KRC] is a real estate investment trust headquartered in Los Angeles, CA and is an owner, developer and acquirer of office properties located along the West Coast. The company's properties are located in Los Angeles, Orange County, San Diego County, greater Seattle, and the San Francisco Bay Area. LEHMAN BROTHERS: Protocol to Resolve Indemnification Claims Okayed ------------------------------------------------------------------ Judge Shelley Chapman approved the procedure proposed by Lehman Brothers Holdings Inc. to resolve its indemnification claims against banks and mortgage lenders. The hearing on the proposed procedure solely with respect to the mortgage loan sellers that filed objections was adjourned to July 16. A copy of Judge Chapman's order is available for free at http://is.gd/tTzgOP Proposed Indemnification Procedure LBHI filed a motion seeking authority from the U.S. Bankruptcy Court for the Southern District of New York to implement what it calls "alternative dispute resolution" procedure to resolve its indemnification claims against banks and mortgage lenders. The company holds indemnification claims tied to mortgage loans it purchased from approximately 3,000 banks and mortgage lenders. Lehman's recent settlement agreements with Freddie Mac and Fannie Mae allowed it to require those banks and mortgage lenders to indemnify the company for losses or damages suffered after purchasing the mortgage loans. Early this year, Lehman settled Freddie Mac's $1.2 billion claim and Fannie Mae's $18.9 billion claim, freeing up billions of dollars for creditors. Freddie Mac's claim stemmed from two loans it extended to Lehman prior to its bankruptcy filing in 2008. Meanwhile, Fannie Mae filed an $18.9 billion claim against the company to recover losses from its investments in residential mortgage-backed securities. Attorney for Lehman, William Maher, Esq., at Wollmuth Maher & Deutsch LLP, in New York, said the proposed procedure would be the "most efficient initial means to enforce [Lehman's] right to reimbursement and indemnification" given the volume of the claims. Mr. Maher said the company expects to obtain "substantial recoveries," which would be used to pay the claims of its creditors. Objection Filed PHH Home Loans, LLC and several other mortgage lending companies are opposing Lehman Brothers Holdings Inc.'s bid to resolve its indemnification claims against them through what it calls an "alternative dispute resolution procedure." Lehman holds claims for losses or damages it suffered after purchasing mortgage loans from approximately 3,000 banks and mortgage lenders. Its recent settlement agreements with Freddie Mac and Fannie Mae allowed it to require those banks and mortgage lenders to indemnify the company. PHH's lawyer Francis Riley, III, Esq., at Saul Ewing LLP, in Princeton, New Jersey, criticized the proposed procedure, saying it would deny the mortgage lender its "due process rights." "If [Lehman] wishes to assert a claim against PHH, the only proper vehicle is an adversary proceeding or other litigation in a court of competent jurisdiction," Mr. Riley said in a court filing. "In such litigation, PHH would have the protections of court procedural rules to protect itself from meritless claims," Mr. Riley said. Douglas Spelfogel of Foley & Lardner LLP said some of the mortgage lenders represented by the New York-based law firm are defendants in lawsuits filed by Lehman in which the latter raised indemnification claims tied to the sale of mortgage loans. Mr. Spelfogel said those mortgage lenders have already incurred litigation expenses and should no longer be subjected to the procedure proposed by Lehman. The mortgage lenders represented by Foley & Lardner include First California Mortgage Co., Mountain West Financial Inc., Republic Mortgage Home Loans LLC and Sun American Mortgage Co. The proposed procedure also drew flak from DHI Mortgage Co. Ltd., MortgageIT Inc., Plaza Home Mortgage Inc., SecurityNational Mortgage Co. and a group of mortgage lending companies represented by Miami-based law firm Bilzin Sumberg Baena Price & Axelrod, LLP. The mortgage lenders argued, among other things, that they have already settled the claims and that Lehman did not identify the lenders that will be bound by the procedure. Bilzin Sumberg can be reached at: Philip R. Stein, Esq. Mindy A. Mora, Esq. BILZIN SUMBERG BAENA PRICE & AXELROD, LLP 1450 Brickell Avenue Suite 2300 Miami, Florida 33131 Phone: (305) 350-2414 Email: pstein@bilzin.com mmora@bilzin.com Foley & Lardner can be reached at: Douglas E. Spelfogel, Esq. Derek L. Wright, Esq. FOLEY & LARDNER LLP 90 Park Avenue New York, New York 10016 Phone: (212) 682-7474 Fax: (212) 687-2329 Email: dspelfogel@foley.com dlwright@foley.com DHI Mortgage is represented by: Daniel F. Markham, Esq. Daniel S. Weinberger, Esq. GIBBONS, P.C. One Pennsylvania Plaza New York, NY 10119 Phone: (212) 613-2043 Fax: (212) 554-9643 Email: dmarkham@gibbonslaw.com dweinberger@gibbonslaw.com PHH Home is represented by: Francis X Riley, III, Esq. Lucian B. Murley, Esq. SAUL EWING LLP 750 College Road East, Suite 100 Princeton, New Jersey 08540 Phone: (609) 452-3150 Fax: (609) 514-3744 Email: friley@saul.com lmurley@saul.com Plaza Home is represented by: Michael O. Ware, Esq. Joaquin M. C de Baca, Esq. MAYER BROWN LLP 1675 Broadway New York, New York 10019 Phone: (212) 506-2500 Email: mware@mayerbrown.com jcdebaca@mayerbrown.com SecurityNational is represented by: Arthur Goldstein, Esq. Jill Makower, Esq. SPIZZ COHEN & SERCHUK, P.C. 425 Park Avenue New York, New York 10022 Phone: (212) 754-9400 Fax: (212) 754-9400 Email: agoldstein@scsnylaw.com jmakower@scsnylaw.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) LEHMAN BROTHERS: July 31 Deadline for LB UK Creditors' Debt Proofs ------------------------------------------------------------------ The joint administrators of Lehman Brothers Holdings plc and Lehman Brothers UK Holdings Limited announced their plan to make a distribution (by way of paying an interim dividend) to the companies' preferential creditors and unsecured, non-preferential creditors. Proofs of debt may be lodged at any point up to July 31, the last date for proving claims, however, creditors are requested to lodge their proofs of debt at the earliest possible opportunity. Persons so proving are required, if so requested, to provide such further details or produce such documents or other evidence as may appear to the joint administrators to be necessary. The joint administrators will not be obliged to deal with proofs lodged after the last date for proving but they may do so if they think fit. The joint administrators intend to make such distribution within the period of two months from the last date for proving claims. For further information, contact details, and proof of debt forms, please visit: http://is.gd/iVJdn6or http://is.gd/Tg3gx2 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: LBEL Creditors July 24 Deadline to Prove Claims ---------------------------------------------------------------- DY Schwarzman, the joint administrator of Lehman Brothers Europe Limited, said the company intends to make a third dividend distribution to its preferential creditors and unsecured non-preferential creditors. The deadline for filing proofs of debt is July 24. LBEL creditors, however, are requested to file their proofs of debt at the earliest possible opportunity. Creditors are required to provide further details or produce the necessary documents to prove their claims. DY Schwarzman will not be obliged to deal with proofs lodged after the last date for proving. DY Schwarzman plans to make the distribution within two months from the last date for proving claims. For further information, contact details, and proof of debt forms, please visit: http://is.gd/1fgWfz 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: Workers' ESOP Suit Revived in Supreme Court ------------------------------------------------------------ Employees of Lehman Brothers Holdings Inc. who invested part of their incomes in the company's stock had their lawsuit revived by the U.S. Supreme Court, according to a July 2 report by Bloomberg News. The high court on July 1 reinstated the class suit filed by the Lehman employees and sent it back to the appeals court. In October 2008, Lehman workers sued company executives who served as trustees of the employee stock ownership plan, or ESOP. They alleged that the plan's trustees violated their fiduciary duties by failing to sell Lehman stock when they should have known the firm was in dire financial condition. The district court dismissed the suit, and the U.S. Court of Appeals in Manhattan reached the same result last July. The Lehman workers sought an appeal from the Supreme Court, according to the Bloomberg report. The Lehman case in the Supreme Court is Rinehart v. Akers, 13-830, U.S. Supreme Court (Washington). The appeal in the court of appeals is Rinehart v. Akers, 11-04232, U.S. Court of Appeals for the Second Circuit (Manhattan). LILY GROUP: Bid to Substantially Consolidate Cases Denied --------------------------------------------------------- Bankruptcy Judge Frank J. Otte denied the motion to substantively consolidate the Chapter 11 cases of Lily Group, Inc. As reported in the Troubled Company Reporter on June 19, 2014, four individual creditors of VHGI Holdings, Inc., under Case No. 14-80005-FJO-11, filed in April 2014, a motion to substantively consolidate the VHGI cases with the bankruptcy case of Lily Group, Inc. VHGI is the sole shareholder of VHGI Coal, Inc., who in turn is the sole shareholder of Lily Group. The VHGI Creditors allegedly lent money to VHGI. In exchange, the Creditors said they were given a senior promissory note that granted senior rights to payment from VHGI, shares of stock of VHGI, and even granted at least two of the Creditors a security interest in all of VHGI's assets. The VHGI Creditors asserted that because some or all of the VHGI Borrowed Funds were used in Lily Group's operations (and even though they knew the VHGI Borrowed Funds were to be lent by VHGI to Lily Group), the Bankruptcy Court presiding over Lily Group's case should enter an order declaring that VHGI and Lily Group are, in essence, one company and that, therefore, VHGI's bankruptcy case and Lily Group's proceeding should be substantively consolidated. Objections to the motion were filed by the Debtor, LC Energy LLC, and the Official Committee of Unsecured Creditors. The Court said that the movant failed to put forth sufficient evidence or argument to support the motion. About Lily Group Inc. Lily Group Inc., the developer of an open-pit coal mine in Green County, Indiana, filed a petition for Chapter 11 reorganization (Bankr. S.D. Ind. Case No. 13-81073) on Sept. 23, 2013, in Terre Haute, estimating assets and debt both exceeding $10 million. Jefferson & Brewer LLC has been designated as the Debtor's chief restructing officer. The Debtor is represented by Courtney Elaine Chilcote, Esq., and David R. Krebs, Esq., at Tucker, Hester, Baker & Krebs, LLC, in Indianapolis, Indiana. U.S. Trustee Nancy J. Gargula appointed four members to the official committee of unsecured creditors in the Chapter 11 cases of Lily Group Inc. Faegre Baker Daniels LLP represents the Committee. LOVE CULTURE: Retailer Planning New Jersey Filing ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that Love Culture Inc., an 80-store women's-wear retailer, is preparing to file under Chapter 11 in New Jersey, according to three people with knowledge of the matter. According to the report, citing the people, professionals working for Love Culture are Lowenstein Sandler LLP, Consensus Advisors and PricewaterhouseCoopers LLP. LTHM HOUSTON: Case Summary & 20 Top Unsecured Creditors ------------------------------------------------------- Debtor: LTHM Houston - Operations, LLC dba St. Anthony's Hospital 2807 Little York Road Houston, TX 77093 Case No.: 14-33899 Nature of Business: Health Care Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Hon. Marvin Isgur Debtor's Counsel: Troy Ted Tindal, Esq. TINDAL LAW FIRM 17225 El Camino Real, Suite 190 Houston, TX 77058 Tel: 832-691-1519 Email: troy@tindallawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Jason LeDay, manager. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/txsb14-33899.pdf M. A. NEGM: Case Summary & 15 Unsecured Creditors ------------------------------------------------- Debtor: M. A. Negm, LLC 302 Main Street Somersworth, NH 03878 Case No.: 14-11412 Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court District of New Hampshire (Manchester) Debtor's Counsel: William S. Gannon, Esq. WILLIAM S. GANNON PLLC 889 Elm Street, 4th Floor Manchester, NH 03101 Tel: (603) 621-0833 Fax: (603) 621-0830 Email: bgannon@gannonlawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Michael A. Negm, 100% member. A list of the Debtor's 15 largest unsecured creditors is available for free at http://bankrupt.com/misc/nhb14-11412.pdf MCGRAW-HILL GLOBAL: Moody's Hikes 1st Lien Debt Rating to B1 ------------------------------------------------------------ Moody's Investors Service assigned Caa1 to the proposed $400 million HoldCo notes of MHGE Parent, LLC ("MHGE") and MHGE Parent Finance, Inc., the parent entities of McGraw-Hill Global Education Holdings, LLC. Net proceeds from the HoldCo notes will fund a $388 million special dividend. In addition, Moody's upgraded existing debt instruments of McGraw-Hill Global Education Holdings, LLC to B1 from B2 due to the cushion provided by the proposed HoldCo notes to the outstanding senior secured debt. Moody's will withdraw the B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating (PDR) and the SGL-2 Speculative Grade Liquidity (SGL) Rating from McGraw-Hill Global Education Holdings, LLC and assign the CFR, PDR and SGL to MHGE in conjunction with this transaction. The outlook is stable. These rating actions are subject to review of final documentation and no meaningful change in conditions of the proposed transaction as advised to Moody's. Assignments: Issuer: MHGE Parent, LLC Corporate Family Rating: Assigned B2 Probability of Default Rating: Assigned B2-PD Speculative Grade Liquidity (SGL) Rating: Assigned SGL-2 Issuer: MHGE Parent, LLC and MHGE Parent Finance, Inc. NEW $400 million HoldCo Notes: Assigned Caa1, LGD6 Upgraded: Issuer: McGraw-Hill Global Education Holdings, LLC $240 million 1st lien senior secured revolver due 2018: Upgraded to B1, LGD3 from B2, LGD3 1st lien senior secured term loan due 2019 ($686 million outstanding): Upgraded to B1, LGD3 from B2, LGD3 $800 million of 9.75% senior secured notes due 2021: Upgraded to B1, LGD3 from B2, LGD3 Outlook Actions: Issuer: MHGE Parent, LLC Outlook is Stable Ratings Rationale MHGE's B2 Corporate Family Rating reflects its good market position and broad range of product offerings in higher education publishing tempered by the proposed increase in leverage, challenging market conditions, and event risks related to ownership by a financial sponsor, Apollo Global Management, LLC ("Apollo"). MHGE's product capabilities position the company to transition the business as higher education publishing continues to shift to digital offerings from traditional formats including printed textbooks. The company nevertheless faces operating headwinds over the next 12 to 18 months from soft higher education enrollment, student efforts to minimize costs through used and rental textbooks, and the risk of revenue disruptions as the digital transition continues to gain momentum. Moody's believes transitioning the revenue base to digital from print will not be smooth as major competitors will act aggressively to gain traction with their own digital offerings, and as schools and students balance adoption with efforts to minimize costs. Despite these challenges, the company has been able to grow cash revenue from digital offerings and increase the percentage of digital cash revenue to 27% of total cash revenue in 2013 (or 35% excluding the custom print segment) which compares favorably to its peer group. The company's pro forma debt-to-EBITDA leverage is high for the B2 CFR at 5.4x as of March 31, 2014 (incorporating Moody's standard adjustments and cash pre-publication costs as an expense, 5.1x giving partial benefit to run rate impact of cost savings that are already actioned but not yet realized) and has increased from 4.4x as of FYE 2013 due to the proposed addition of $400 million of HoldCo notes to fund a special dividend to Apollo. MHGE is performing better than Moody's initial expectations when Apollo acquired McGraw-Hill Education in March 2013. Cash revenue of $1.3 billion is pacing just ahead of Moody's expectations and effective cost controls have contributed to better than expected free cash flow generation through March 2014. Moody's note the company has made good progress in establishing itself as a stand-alone operation since being separated from its former parent, McGraw- Hill Companies, Inc. Management indicates that it has completed actions to achieve up to an estimated $55 million of expense savings or more than two-thirds of its $79 million savings target through 2015. Ratings reflect Moody's expectation that MHGE will consistently reduce leverage to less than 5.0x which is critical to maintain the B2 CFR. Absent acquisitions, Moody's expects the company will generate at least mid-single digit percentage free cash flow-to-debt. Moody's believes the potential for another leveraging transaction by Apollo increases as MHGE's cash flow rises given the financial sponsor's track record, evidenced by the proposed transaction and previously with its sister company, McGraw-Hill School Education, which funded a $445 million dividend in December 2013. The stable rating outlook reflects Moody's view that MHGE's EBITDA will grow in the low single digit percentage range in 2014 due largely to implementation of further cost reductions as revenue growth will be muted by challenging market conditions through 2015. Despite higher interest expense from the new HoldCo notes, Moody's expect MHGE will maintain good liquidity over the next 12 months and generate at least mid single-digit percentage free cash flow-to-debt while reducing debt balances through required amortization, excess cash flow sweeps, or potential voluntary prepayments. Moody's believes the company will have sufficient restricted payment capacity to fund current interest payments on the new HoldCo notes to avoid high coupon accretion. The outlook does not include significant debt financed acquisitions or another large distribution. MHGE's ratings could be downgraded if the company's revenue base erodes due to soft market conditions or an inability to manage the transition of the higher education market to digital offerings. Weaker free cash flow generation, Moody's expectations for debt- to-EBITDA being sustained above 5.0x (including Moody's standard adjustments and cash pre-publication costs as an expense), leveraging acquisitions, unexpected shareholder distributions, or a deterioration of liquidity could also result in a downgrade. An upgrade of the corporate family rating of MHGE is not likely given Apollo's track record for significant cash distributions from MHGE as well as from its sister company, McGraw-Hill School Education Holdings, LLC. The principal methodology used in this rating was the Global Publishing Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. MHGE Parent, LLC, headquartered in New York, NY, is a global provider of educational materials and learning services targeting the higher education, professional learning and information markets with content, tools and services delivered via digital, print and hybrid offerings. A subsidiary of a publishing company that was formed in 1909, MHGE is one of the three largest U.S. publishers focusing on the higher education market with approximately $1.3 billion of annual cash revenue. MHGE has shared services arrangements with its smaller sister company, McGraw-Hill School Education Holdings, LLC ("MHSE"), a provider of digital, print and hybrid instructional materials, and assessment offerings for the K-12 market. MHGE and MHSE were acquired by funds affiliated with Apollo Global Management, LLC in March 2013 for a combined $2.4 billion purchase price and are both wholly-owned subsidiaries of MHE US Holdings, LLC. MHGE (allocated 80% of the combined purchase price) does not guarantee or provide any collateral to the financing of MHSE (allocated 20% of the combined purchase price) and MHSE does not guarantee or provide collateral to the financing of MHGE. MCGRAW-HILL GLOBAL: S&P Affirms 'B+' Rating on 1st Lien Debt ------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating on McGraw-Hill Global Education Holdings LLC (MHGE). The outlook is stable. At the same time, S&P affirmed its 'B+' issue-level ratings on all of MHGE's existing first-lien senior secured debt, which includes a $240 million undrawn revolver, a $686 million outstanding term loan, and $800 million in notes. The recovery rating on all of this debt is unchanged at '3', indicating S&P's expectation of meaningful recovery (50% to 70%) for lenders in the event of payment default. In addition, S&P assigned the company's proposed $400 million in senior holding company notes an issue-level rating of 'B-' with a recovery rating of '6', indicating S&P's expectation of negligible recovery (0% to 10%) for lenders in the event of a payment default. The notes will be co-issued by MHGE Parent, LLC (HoldCo) and MHGE Parent Finance Inc. "We base the rating affirmation on our assessment of MHGE as a "core" asset of its parent company, MHE US Holdings LLC (MHE), which has a group credit profile of 'b+'. Our "core" assessment of MHGE reflects the fact that it contributes about 60% of overall group revenues and accounts for roughly 90% of group debt. Additionally, MHGE operates in lines of business that are integral to the overall group strategy and is closely linked to the group's reputation, name, brand, and risk management. MHE is also the parent company of McGraw-Hill School Education (MHSE), which we view as a "highly strategic" asset of MHE, and which we also include in our group credit profile analysis. Our "highly strategic" assessment of MHSE reflects the fact that it accounts for a smaller proportion of group revenue, although we have taken into consideration the mutual business ties," S&P said. "Our business risk assessment of the consolidated MHE is "fair," which reflects the company's solid competitive position in the higher education and elementary-through-high school (el-hi) publishing markets and its consistent free cash flow generation. However, the assessment also reflects the company's exposure to college enrollment trends and competition from the used and rental textbook markets, as well as the combined entity's reliance on state and local budgetary spending that directly affects the el-hi business. We assess the company's financial profile as "highly leveraged," based on the consolidated entity's private equity ownership, aggressive financial policy, and demonstrated willingness to initiate significant debt-financed special dividends to shareholders. Our management and governance assessment of MHE is "fair"," S&P added. MEMORIAL PRODUCTION: Moody's Rates $500MM Unsecured Notes 'Caa1' ---------------------------------------------------------------- Moody's Investors Service assigned a Caa1 rating on Memorial Production Partners LP's (MEMP) proposed $500 million senior unsecured notes due 2022. Memorial Production Finance Corporation is a wholly-owned subsidiary of MEMP and serves as the co-issuer of the notes. MEMP intends to use the net proceeds from the proposed notes offering, in combination with net proceeds from MEMP's recent equity offering, to repay a portion of the outstanding borrowings under its revolving credit facility and for general partnership purposes. The rating outlook is stable. On July 1, 2014, MEMP closed its previously announced acquisition of certain oil producing properties in Wyoming for a purchase price of approximately $915 million, subject to customary post closing adjustments. In conjunction with the closing of the acquisition, MEMP amended its $2.0 billion multi-year revolving credit facility, increasing its borrowing base from $870 million to $1.44 billion. The acquisition was funded with borrowings under MEMP's revolving credit facility. "The notes term out a portion of MEMP's outstanding revolver borrowings on a long-term basis," stated Michael Somogyi, Moody's Vice President-Senior Analyst. "Combined with proceeds from the recent equity offering, the new notes offering serves to enhance MEMP's liquidity position and provide for increased financial flexibility to fund expected future acquisitions." Ratings Rationale The Caa1 rating on MEMP's proposed $500 million senior unsecured notes reflect their subordinate position relative to the partnership's senior secured revolver. MEMP also has $700 million of senior unsecured notes due 2021 outstanding. The notes are fully and unconditionally guaranteed on a senior unsecured basis and are subordinate to MEMP's secured revolver. The revolver's first priority claim results in the notes being rated two notches below the B2 CFR under Moody's Loss Given Default Methodology. MEMP's B2 Corporate Family Rating (CFR) reflects its long-lived, shallow decline, predominately proved developed reserve base. The B2 Corporate Family Rating is restrained by MEMP's high leverage on production and proved developed reserves. The B2 CFR also reflects the risks inherent in MEMP's acquisitive, high payout MLP corporate finance model, but recognizes management's track record in issuing equity and active hedging program. MEMP's property base features low exploration and development risk and a fairly predictable production profile. Year to date, MEMP has completed $1.143 billion in acquisitions across three basins, including properties acquired in the Eagle Ford trend in South Texas, a drop-down of East Texas properties from MEMP's sponsor, Memorial Resource Development (MRD, B2 stable), and the acquisition of oil-producing properties in Wyoming. Total proved reserves on the acquisitions are 94 million barrels of oil equivalent (BOE), of which 74% are oil, 24% are NGLs and 2% are natural gas, and provide net production of approximately 8,000 BOE per day. MEMP's total proved reserves increase by about 55% to 263 million BOE with oil and natural gas liquids comprising approximately 61% of proved reserves, compared to 40% at year-end 2013. The partnership's proved developed reserve life is also extended to over 12 years based on average daily production volumes of approximately 35,500 BOE per day. Still, leverage on average daily production and PD reserves approach $50,000 per BOE and $11.00 per BOE, respectively, compared to around $35,000 per BOE and $9.25 per BOE, respectively, for the twelve month period ended March 31, 2014. Moody's expect MEMP to remain disciplined in its funding strategy by following through on its proven track record of financing future acquisitions with a large equity component. A critical focus of Moody's will also be how well the partnership integrates these acquired assets and executes on its development strategy. The outlook is stable based on Moody's expectation that MEMP continues to finance acquisitions with a meaningful equity component and maintains appropriate leverage metrics and liquidity. Moody's could upgrade the ratings if the partnership is able to lower its financial leverage profile (debt/production less than $30,000 BOE per day and debt/proved developed reserves of less than $9.00 per BOE) while also maintaining sufficient distribution coverage above 1.0x and adequate liquidity. The rating could be considered for downgrade if debt/proved developed reserves are sustained above $12.00 per BOE, if distribution coverage weakened below 1.0x for a sustained period, or if the partnership's operational risk profile deteriorates materially. The principal methodology used in this rating was the Global Independent Exploration and Production Industry published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Memorial Production Partners LP is a publicly traded oil and gas exploration and production MLP headquartered in Houston, TX. MEMORIAL PRODUCTION: S&P Cuts Sr. Unsecured Notes Rating to 'CCC+' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its issue-level rating on Houston-based exploration and production partnership Memorial Production Partners LP's senior unsecured notes to 'CCC+' from 'B-' and removed it from CreditWatch with negative implications, where S&P had placed it on May 6, 2014. S&P simultaneously revised the recovery rating on the outstanding notes to '6', indicating its expectation of negligible (0% to 10%) recovery in the event of a payment default, from '5'. At the same time, S&P assigned its 'CCC+' issue-level rating, with a '6' recovery rating, to Memorial's proposed $500 million senior unsecured notes due 2022. S&P's 'B' corporate credit rating on Memorial remains unchanged. The outlook is positive. The rating action reflects an updated valuation of the partnership's reserves under S&P's recovery price assumptions following the recent acquisition of reserves in Wyoming, an updated higher borrowing base amount under the partnership's reserve based loan facility, and the proposed $500 million senior unsecured notes. The increase in the reserve value associated with the partnership's recent acquisition is more than offset by the higher level of secured and unsecured debt, resulting in lower recovery expectations on the partnership's unsecured notes. Ratings List Memorial Production Partners LP Corporate Credit Rating B/Positive/-- New Rating Memorial Production Partners LP Memorial Production Finance Corp. $500 million senior unsecured notes due 2022 CCC+ Recovery Rating 6 To From Rating Lowered; Recovery Rating Revised Memorial Production Partners LP Memorial Production Finance Corp. Senior unsecured notes CCC+ B- Recovery Rating 6 5 MF GLOBAL: UK Unit OK'd to Pay Clients After Key Settlement ----------------------------------------------------------- Law360 reported that a British judge has approved a settlement that will allow MF Global Inc.'s U.K. unit to close out a $1 billion client money pool and finally make distributions to customers and creditors nearly three years after the broker- dealer's collapse, according to an opinion. Law360 related that U.K. High Court Judge David Richards signed off on the deal, which resolves potential breach of trust and tracing claims from the client money pool against MF Global U.K. Ltd.'s general estate over its failure to segregate client funds. About MF Global New York-based MF Global -- http://www.mfglobal.com/-- was one of the world's leading brokers of commodities and listed derivatives. MF Global provides access to more than 70 exchanges around the world. The firm also was one of 22 primary dealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. MF Global's roots go back nearly 230 years to a sugar brokerage on the banks of the Thames River in London. On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059 and 11-5058), after a planned sale to Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF Global had $41,046,594,000 in total assets and $39,683,915,000 in total liabilities. On Nov. 7, 2011, the United States Trustee appointed the statutory creditors' committee in the Debtors' cases. At the behest of the Statutory Creditor's Committee, the Court directed the U.S. Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the Bankruptcy Court entered an order approving the appointment of Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC, as Chapter 11 trustee. On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services LLC and MF Global FX Clear LLC filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and 11-15810). On Dec. 27, the Court entered an order installing Mr. Freeh as Chapter 11 Trustee of the New Debtors. On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr. Freeh also was installed as its Chapter 11 Trustee. Judge Honorable Martin Glenn presides over the Chapter 11 case. J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve as bankruptcy counsel. The Garden City Group, Inc., serves as claims and noticing agent. The petition was signed by Bradley I. Abelow, Executive Vice President and Chief Executive Officer of MF Global Finance USA Inc. The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan LLP, as investigative counsel; (ii) FTI Consulting Inc., as restructuring advisors; (iii) Morrison & Foerster LLP, as bankruptcy counsel; and (iv) Pepper Hamilton as special counsel. The Official Committee of Unsecured Creditors has retained Capstone Advisory Group LLC as financial advisor, while lawyers at Proskauer Rose LLP serve as counsel. The Securities Investor Protection Corporation commenced liquidation proceedings against MF Global Inc. to protect customers. James W. Giddens was appointed as trustee pursuant to the Securities Investor Protection Act. He is a partner at Hughes Hubbard & Reed LLP in New York. Jon Corzine, the former New Jersey governor and co-CEO of Goldman Sachs Group Inc., stepped down as chairman and chief executive officer of MF Global just days after the bankruptcy filing. In April 2013, the Bankruptcy Court approved MF Global Holdings' plan to liquidate its assets. Bloomberg News reported that the court-approved disclosure statement initially told creditors with $1.134 billion in unsecured claims against the parent holding company why they could expect a recovery of 13.4% to 39.1% from the plan. As a consequence of a settlement with JPMorgan, supplemental materials informed unsecured creditors their recovery was reduced to the range of 11.4% to 34.4%. Bank lenders will have the same recovery on their $1.174 billion claim against the holding company. As a consequence of the settlement, the predicted recovery became 18% to 41.5% for holders of $1.19 billion in unsecured claims against the finance subsidiary, one of the companies under the umbrella of the holding company trustee. Previously, the predicted recovery was 14.7% to 34% on bank lenders' claims against the finance subsidiary. MOBILEBITS HOLDINGS: Has $2.91-Mil. Net Loss in April 30 Quarter ---------------------------------------------------------------- MobileBits Holdings Corporation filed its quarterly report on Form 10-Q disclosing a net loss of $2.91 million on $298,011 of total revenues for the three months ended April 30, 2014, compared with a net loss of $938,449 on $1.09 million of total revenues for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $7.74 million in total assets, $2.82 million in total liabilities, and stockholders' equity of $4.92 million. The Company has suffered recurring losses from operations. The Company has a net loss of $4.48 million, a working capital deficit of $2.11 million and net cash used in operations of $759,511 for the six months ended April 30, 2014; and an accumulated deficit of $42.01 million at April 30, 2014. In addition, the Company has not completed its efforts to establish a stable recurring source of revenues sufficient to cover its operating costs for the next twelve months. These factors raise substantial doubt regarding the Company's ability to continue as a going concern, according to the regulatory filing. A copy of the Form 10-Q is available at: http://is.gd/Zq1AGV MobileBits Holdings Corporation provides Samy, a digital loyalty and marketing solution that aims to better consumer engagement of brick and mortar stores. The Sarasota, Florida-based Company was formerly known as Bellmore Corporation until it changed its name to MobileBits Holdings Corporation in 2010. MOMENTIVE PERFORMANCE: Bridge Facility Letter Approval Sought ------------------------------------------------------------- BankruptcyData reported that Momentive Performance Materials filed with the U.S. Bankruptcy Court a motion to authorize the Debtors to (a) enter into a bridge facility commitment letter and related commitment documents, (b) enter into an engagement letter related to a second lien notes offering and (c) pay fees, costs and expenses in connection therewith. According to BData, the motion explains that after good faith, arm's-length negotiations, the Debtors and JPMorgan Securities LLC, Citigroup Global Markets, Inc., and Credit Suisse Securities (USA) LLC, reached an agreement on the commitment letter under which the Bridge Facility Lenders committed to provide, and to act as Arrangers for, a new second lien secured bridge loan facility in the aggregate principal amount of up to $250,000,000 to be drawn to the extent the Debtors are not able to issue new senior second-priority secured notes in a Rule 144A or other private placement yielding sufficient aggregate cash proceeds to pay the 1.5 Lien Note Claims in cash pursuant to Section 5.5(b)(i) of the Plan. BData added that the Debtors also entered into an engagement letter, which contemplates the Debtors' engagement of JPMorgan Securities LLC, Citigroup Global Markets, Inc., and Credit Suisse Securities (USA) LLC as investment bankers in connection with a registered or a Rule 144A or other private placement of the Second Lien Notes. The Court scheduled a July 18, 2014 hearing on the motion, BData said. About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and their affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 14-22503) on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. The Debtors have tapped Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of these chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. The U.S. Trustee for Region 2 appointed seven members to serve on the Official Committee of Unsecured Creditors of the Debtors' cases. Klee, Tuchin, Bogdanoff & Stern LLP serves as its counsel. FTI Consulting, Inc., serves as its financial advisor. Rust Consulting Omni Bankruptcy serves as its information agent. MORNINGSTAR MARKETPLACE: Claims Bar Date Set for July 21 -------------------------------------------------------- Creditors of Morningstar Marketplace, LTD must file their proofs of claim not later than July 21, 2014. The deadline for government entities to file proofs of claim is set for July 28. About Morningstar Marketplace Morningstar Marketplace, LTD, operator of a flea market business in St. Thomas, Pennsylvania, filed a Chapter 11 bankruptcy petition (Bankr. M.D. Pa. Case No. 14-00451) in Harrisburg on Feb. 3, 2014. Judge Mary D France presides over the case. Attorneys at Smigel, Anderson & Sacks, LLP serve as counsel to the Debtor. The Debtor estimated $100 million to $500 million in assets and liabilities. NAKED BRAND: Reports $1.23-Mil. Net Loss in April 30 Quarter ------------------------------------------------------------ Naked Brand Group Inc. filed its quarterly report on Form 10-Q disclosing a net loss of $1.23 million on $119,814 of net sales for the three months ended April 30, 2014, as compared with a net loss of $643,434 on $93,566 of net sales for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $1.4 million in total assets, $3.18 million in total liabilities, and a stockholders' deficit of $1.78 million. As at April 30, 2014, the Company had not yet achieved profitable operations, had a working capital deficiency, and expects to incur further losses in the development of its business, which casts 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/0NgYxB Naked Brand Group Inc. is engaged in the manufacture and sales of direct and wholesale undergarments in Canada and the United States to consumers and retailers. The Company operates out of Abbotsford, British Columbia, Canada. NATIONAL CINEMEDIA: Moody's Rates $135MM Credit Facility 'Ba2' -------------------------------------------------------------- Moody's Investors Service rated National CineMedia, LLC's (NCM) $135 million revolving credit facility Ba2. NCM's Corporate Family Rating and Probability of Default Rating were affirmed at Ba3 and Ba3-PD. The company's senior secured notes and senior unsecured notes were both affirmed at Ba2 and B2, respectively. NCM's speculative grade liquidity rating was affirmed at SGL-2 (good) and the outlook remains stable. The new $135 million revolving credit facility due 26 November 2019 replaces an existing $110 million revolving credit facility due 26 November 2017, with the new facility being upsized by $25 million to provide increased financial flexibility for the recently announced Screenvision acquisition. The upsize of the facility has no material impact on instrument ratings. The maturity of an existing $14 million revolving credit facility continues to be 31 December 2014. Moody's will withdraw ratings on the existing credit facility in due course. At closing of the Screenvision acquisition, NCM Inc., the publically traded parent with a 45.8% interest in NCM LLC, will acquire and fund the acquisition. However, subsequent to the closing of the transaction, NCM Inc., has indicated that it will likely move Screenvision and related debt down to the NCM, LLC level. Moody's anticipates the debt structure at that time will be similar to the current 75% secured/25% unsecured debt stratification at NCM LLC. Deviation from the 75%/25% breakdown may cause the secured pool of debt to be downgraded by a notch to Ba3 from Ba2. Moody's will rate the new debt at NCM, LLC level once it is issued -- currently expected to be sometime by Q4/2014. The following summarizes the rating actions on National CineMedia, LLC: Assignments: Senior Secured Bank Credit Facility, Assigned Ba2 (LGD3) Other: Corporate Family Rating, affirmed at Ba3 Probability of Default Rating, affirmed at Ba3-PD Speculative Grade Liquidity Rating, affirmed at SGL-2 Outlook, maintained at Stable Senior Secured Bank Credit Facility, affirmed at Ba2 (LGD3) Senior Secured Regular Bond/Debenture, affirmed at Ba2 (LGD3) Senior Unsecured Regular Bond/Debenture, affirmed at B2 (LGD6) NEW ENGLAND COMPOUNDING: Patients Sue NJ Hospital Over Outbreak --------------------------------------------------------------- Law360 reported that Inspira Health Network Inc. has been hit with two lawsuits in New Jersey court from patients who claim they were administered fungus-contaminated steroid medication from the New England Compounding Center, the bankrupt pharmaceutical compounder tied to a fatal 2012 meningitis outbreak. According to the report, the June 30 suits that Michael Bazikos and Arabella West filed in Essex County Superior Court target companies associated with the NECC but also look to hold their medical providers accountable for tainted injections of preservative free methylprednisolone acetate, or MPA. About New England Compounding Pharmacy New England Compounding Pharmacy Inc., filed a Chapter 11 petition (Bankr. D. Mass. Case No. 12-19882) in Boston on Dec. 21, 2012, after a meningitis outbreak linked to an injectable steroid, methylprednisolone acetate ("MPA"), manufactured by NECC, killed 39 people and sickened 656 in 19 states, though no illnesses have been reported in Massachusetts. The Debtor owns and operates the New England Compounding Center is located in Framingham, Mass. In October 2012, the company recalled all its products, not just those associated with the outbreak. Paul D. Moore, Esq., at Duane Morris LLP, in Boston, has been appointed as Chapter 11 Trustee of NECC. He is represented by: Jeffrey D. Sternklar, Esq. DUANE MORRIS LLP Suite 2400 100 High Street Boston, MA 02110-1724 Tel: 857-488-4216 Fax: 857-401-3034 An Official Committee of Unsecured Creditors appointed in the case has been represented by: BROWN RUDNICK LLP William R. Baldiga, Esq. Rebecca L. Fordon, Esq. Jessica L. Conte, Esq. One Financial Center Boston, MA 02111 Tel: (617) 856-8200 - and - David J. Molton, Esq. Seven Times Square New York, NY 10036 Tel: (212) 209-4800 OCZ TECHNOLOGY: Confident About Approval of 'Consensual' Plan ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that OCZ Technology Group Inc., a producer of solid-state computer drives, is confident of a "consensual" approval of the liquidating Chapter 11 plan at the July 22 confirmation hearing, even though general unsecured creditors receive nothing and are presumed to oppose the plan. According to the report, general unsecured creditors owed about $20 million won't vote on the plan because they are deemed to vote "no." They get nothing other than recoveries from lawsuits, according to disclosure materials, the report noted. About OCZ San Jose, Calif.-based OCZ Technology Group, Inc. (Nasdaq: OCZ) designs, manufactures, and distributes high-performance solid- state storage solutions and premium computer components. OCZ and two affiliates on Dec. 2, 2013, filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13126) with a deal to sell all assets under 11 U.S.C. Sec. 363 to Toshiba Corporation for $35 million. As of the bankruptcy filing, the Debtors had funded indebtedness of $29.3 million and general unsecured trade obligations of $31.4 million. The Debtors are represented by Mayer Brown LLP's Sean T. Scott, Esq., as counsel and Young Conaway Stargatt & Taylor LLP's Michael R. Nestor, Esq., Matthew B. Lunn, Esq., and Jaime Luton Chapman, Esq., as Delaware local counsel. Deutsche Bank is the Debtors' investment banker. Mike Rizzo Jr. at RAS Management Advisors, LLC, serves as financial advisors to the Debtors. The Hon. Peter J. Walsh presides over the case. Kelley Drye & Warren LLP's Eric R. Wilson, Esq., Jason R. Adams, Esq., and Gilbert R. Saydah Jr., Esq., serve as counsel to the official committee of unsecured creditors, and Greenberg Traurig, LLP's Dennis A. Meloro, Esq. serves as local counsel. OCZ Technology, on Jan. 17, 2014, received approval from the Bankruptcy Court to sell substantially all of its assets to Toshiba Corporation for $35 million. OCZ Technology changed its name to ZCO Liquidating Corporation. OMEGA HEALTHCARE: Fitch Affirms 'BB+' Subordinated Debt Rating -------------------------------------------------------------- Fitch Ratings has affirmed the credit ratings of Omega Healthcare Investors, Inc. (NYSE: OHI, or Omega) as follows: -- Issuer Default Rating (IDR) at 'BBB-'; -- Unsecured revolving credit facility at 'BBB-'; -- Senior unsecured notes at 'BBB-'; -- Senior unsecured term loan at 'BBB-'; -- Subordinated debt at 'BB+'. The Rating Outlook is Stable. Key Rating Drivers The ratings reflect the strength of the company's metrics (low leverage, high fixed-charge coverage, stable cash flows and exceptional liquidity due to no near-term maturities), which offset the largest credit concern - the focus on skilled nursing and assisted living facilities. The high percentage of government reimbursement and the corresponding regulatory risk to operators of these facilities may place pressure on operator earnings. Of secondary concern is the debt maturity schedule which, while long- dated, is concentrated in 2022 and 2024. OHI can reduce the maturity risk by calling certain notes in whole or in part ahead of the stated maturities and/or by growing the portfolio further. Strong Credit Metrics Fixed-charge coverage is strong for the 'BBB-' rating at 3.6x for the trailing 12 months (TTM) and quarter ended March 31, 2014, compared with 3.0x for the years 2012 and 2011, respectively. Contractual rental escalators drive Fitch's expectation of fixed- charge coverage remaining above 3.5x and approaching 4.0x through the end of 2016. Fitch defines fixed-charge coverage as recurring operating EBITDA less straight-line rents divided by total interest incurred. Leverage is also strong for the 'BBB-' rating. Leverage was 5.0x and 4.5x for the TTM and quarter ended March 31, 2014, which reflects the timing of the Ark Holdings transaction, as compared with 5.6x and 5.7x as of Dec. 31, 2012 and 2011, respectively. Fitch forecasts that leverage will remain in the mid-4.0x-5.0x range through 2015 as the company acquires additional facilities funded evenly through debt and equity, and as contractual rental escalators increase same-store EBITDA. Fitch calculates leverage as net debt-to-recurring operating EBITDA. Strong Liquidity But Concentrated Debt Maturities OHI's lack of near-term debt maturities and capital expenditures, coupled with full availability under the recently refinanced and expanded $1 billion revolving credit facility provides OHI with significant liquidity. OHI's nearest debt maturity will be the $200 million term loan due 2019. Fitch notes OHI's debt maturities are long-dated but concentrated with 27.5% and 38.2% maturing in 2022 and 2024, respectively. However, the 2022 notes and $400 million of the 2024 notes may be called by the company beginning in 2015 and 2017, respectively, and Fitch expects OHI will seek to refinance each note with proceeds from longer-dated senior unsecured note issuances provided the market pricing at that time offsets the incurrence of the call premium. Commonality of Tenant Revenue Sources Mitigates Operator Diversification Benefits Offsetting the credit positives is OHI's focus on skilled-nursing facilities (SNF) and assisted-living facilities, which are highly reliant upon federal and state reimbursement. Approximately 92% of OHI's operator revenues are derived from public sources as of Dec. 31, 2013. Operators have experienced greater financial volatility and stress when rates and/or reimbursement formulas have changed. Healthcare legislation, together with budgetary concerns at both the federal and state levels will likely continue to pressure operator margins and operators' capacity to honor lease obligations. As expected by Fitch, OHI's operators' rent coverage has weakened due to the Centers for Medicare & Medicaid Services 2011 reimbursement rate adjustment but remains solid (though not robust) at 1.9x and 1.4x for EBITDARM and EBITDAR, respectively for the TTM ended Dec. 31, 2013. These levels compare to 2.2x and 1.8x, respectively, for the year ended Dec. 31, 2011. Master leases with cross-collateralization and EBITDAR coverage covenants improve OHI's security; however, OHI remains at risk for potential tenant defaults and/or requests for rental relief concessions stemming from changes to reimbursement rates. OHI's operators have been offsetting revenue declines through non- rent operating expense cost savings. Coverage metrics have declined moderately but Fitch expects they will stabilize near current levels. Fair Contingent Liquidity The majority of OHI's assets are unencumbered and Fitch estimates unencumbered asset coverage of unsecured debt ranges from 1.6x to 2.1x based on a stressed capitalization range of 9%-12%. The mid- point of the coverage is down from previous years though Fitch notes this is driven in part by the timing of acquisitions and Fitch anticipates OHI's normalized unencumbered asset coverage ratio should remain around 2.0x. Despite eight quarters of dividend increases, OHI has continued to reduce its adjusted funds from operations (AFFO) payout ratio to 71% for 1Q'14 from the low 90% range in 2007-2009. As a result, OHI is able to retain approximately $50 million-$100 million of cash flow from operations to fund acquisitions and debt repayment, which Fitch views favorably. OHI targets an AFFO payout ratio of less than 85% (currently at 69% based on the company's calculations), thus Fitch expects OHI will continue to increase the dividend in subsequent quarters. Subordinated Debt Notching The one-notch differential between OHI's IDR and the subordinated debt assumed as part of the CapitalSource transaction considers the relative subordination within OHI's capital structure. The interest is due and payable only to the extent that there is rent being received from the tenants of the acquired properties to cover the interest expense related to the debt, and the principal is due only to the extent that all rent has been paid for the term of the debt. Stable Outlook The Stable Outlook reflects Fitch's expectation that metrics will improve but remain appropriate for the current rating and that any reimbursement pressures at the operator level will have a minimal impact on OHI cash flows given lease length, covenants and coverage. Rating Sensitivities Fitch does not expect management to operate the company consistent with these factors that could otherwise result in positive momentum in OHI's ratings and/or Outlook: -- Increased scale and diversification; -- Fitch's expectation of net debt-to-recurring operating EBITDA sustaining below 4.0x (leverage was 5.0x and 4.5x for TTM and quarter ended March 31, 2014); -- Fitch's expectation of fixed-charge coverage sustaining above 3.5x (coverage was 3.6x for the TTM and quarter ended March 31, 2014). The following factors may result in negative momentum in OHI's ratings and/or Outlook: -- Further pressure on operators through reimbursement cuts; -- Fitch's expectation of leverage sustaining above 5.5x; -- Fitch's expectation of fixed-charge coverage sustaining below 2.5x. PETROLOGISTICS LP: Moody's Places B1 CFR on Review for Upgrade -------------------------------------------------------------- Moody's Investors Service upgraded PetroLogistics LP's senior notes ratings to A3 from B2, reflecting the support provided by Flint Hills Resources, LLC (FHR, A1, stable), a subsidiary of Koch Industries, Inc. FHR's proposed $2.1 billion friendly cash acquisition of PetroLogistics is expected to provide the existing $365 million 6.25% Sr. Notes due 2020 (Sr. Notes) with various implicit and contractual support including a Demand Note sized to fully cover all interest and principal obligations through maturity. The company's Corporate Family Rating (CFR) will be withdrawn with the move to investment grade. These rating actions conclude the review initiated on May 28, 2014. The transaction is expected to close in the near term. The outlook is stable. "The inherent strength of the Flint Hills ownership combined with the expected support package provide a high level of assurance that PetroLogistics obligations will be upheld," said Moody's Analyst Lori Harris. Ratings Rationale The A3 rating reflects the overarching financial and strategic support provided to PetroLogistics by FHR, a large well funded profitable A1 rated entity. Such strategic and financial support includes the benefit of product marketing, feedstock market access and pricing, FHR credit facility access, and third party credit default protections. The rating is also enhanced by the meaningful benefits of the dissolution of the MLP structure such that the requirements to distribute cash would no longer burden PetroLogistics, thus allowing for alternative use of cash to support downtime, expansion, or other constructive efforts, but not to the exclusion of FHR's desire to otherwise extract and use the cash. Importantly, the rating reflects the benefits of various contractual provisions including the $500 million Demand Note, which provides contractual assurance for the payments of all interest and principal obligations under the Sr. Notes in full, through maturity. Because of the legal obligation and terms of the Demand Note, Moody's believes that there is a high level of support for the repayment and compliance with the Sr. Note obligations. Although the Demand Note support mechanisms are more complex than the time and court tested guarantee structure, there is elevated assurance that the obligations will be paid in a timely manner within the grace period, though not necessarily on the due date. The rating also reflects the contractual requirements of the Master Sales Agreement which include both pricing protections and upside benefits for PetroLogistics as well as additional assurance of FHR's credit protection and market advantages. The attributes of the Master Services Agreement and Guarantee of performance on contractual obligations of FHR subsidiaries are also included in the rating. Further supporting the A3 rating is the new pari passu revolving credit facility provided by FHR, which is expected to be increased to $290 million, from $170 million under the existing facility. The pari passu feature of the new $290 million facility is an improvement versus the existing $170 million credit facility which is structurally senior to the Sr. Notes. The increased size of the $290 million facility is expected to provide strong liquidity to the PetroLogistics operations and Sr. Notes. The new credit facility is anticipated to be used in conjunction with cash from operations to support maintenance capex, possible growth capex, and payments on the Sr. Notes. Benefitting from a limitation on both dividends and the incurrence of additional debt, the new facility is not expected to be heavily used, rather it will provide additional liquidity in terms of timing, especially for potential periods of heavy capex expansion spending or other events beyond the good quarterly cash generation capabilities of PetroLogistics normal operations. PetroLogistics operations generate strong financial metrics and Moody's expects it to continue to do so as the market for its main product, propylene, will remain tight in North America through 2015. Since startup, the company has generated unusually high cash margins due to low propane prices. However, with the run-up in propane prices in the first quarter of 2014 and further increases in propane exports, margins are expected to be somewhat lower in 2014. Other favorable credit attributes include FHR as its new singular customer, its geographic location, and ample pipeline connectivity. The company's single site location on the Houston ship channel, its limited operating history and potential volatility in quarterly earnings are factored into the rating, but are more than offset by the implicit support provided by the FHR ownership. FHR's merger plans include various merger stages which will change the PetroLogistics name to one bearing the Flint Hills moniker. The alteration is not expected to impact the ratings, but does imply a degree of reputational risk for FHR, an additional impetus for their support of the entity and Sr. Notes. FHR continues negotiations with holders of the Sr. Notes regarding the public disclosures and filings required of PetroLogistics following the merger. If FHR's consent solicitation process with the noteholders successfully alleviates the SEC filing requirements, then PetroLogistics financials and disclosures would be communicated through a private site. Moody's believes that FHR will convey comprehensive and timely updates regarding the financial and operational condition of PetroLogistics via the proposed private site and other communications that will be sufficient to inform the rating. Ratings Upgraded: Issuer: PetroLogistics LP $365 million 7 year Sr. Unsec. Notes, A3 from Review for Upgrade, B2 Ratings Assigned: Senior unsecured, A3 Outlook Actions: Outlook, Changed To Stable from Rating Under Review for Upgrade Ratings Withdrawn: Corporate Family Rating, Review for Upgrade, B1 Probability of Default Rating, Review for Upgrade, B1-PD Speculative Grade Liquidity Rating -- SGL-2 The stable outlook reflects the support of PetroLogistics from FHR and the expected earnings and good cash flow generation. Future upward or downward ratings moves for PetroLogistics would likely be tied to a similar move in FHR's rating. The principal methodology used in this rating was Global Chemical Industry Rating Methodology published in December 2013. PetroLogistics LP is headquartered in Houston, TX. PetroLogistics owns the largest propane dehydrogenation (PDH) facility in the world, with a current capacity of 1.4 billion pounds. Construction on the propane dehydrogenation / propylene production facility was completed in October 2010, and after a reasonable start-up period it demonstrated production rates at current nameplate capacity. PetroLogistics will be acquired by Flint Hills Resources, LLC, thus dissolving the variable distribution master limited partnership (MLP) structure which was formed on May 2012, through an IPO wherein, 63% of the company's common units were owned Lindsay Goldberg and York Capital Management, 26% owned by the public, and the remainder owned by officers and directors. Revenues for the LTM ending March 31, 2014 were $769 million. Flint Hills Resources, LLC (FHR) is engaged in wholesale refining, petrochemicals, renewable fuels manufacturing (mainly ethanol), refined products distribution, and lube basestock production, the latter through a 50% stake in Excel Paralubes. FHR is a wholly- owned subsidiary of Koch Resources, LLC (KRLLC, Aa3 stable), which is in turn a wholly-owned subsidiary of privately owned Koch Industries, Inc. (KII, not rated). FHR is run as an independent company within KRLLC with its own assets and external liquidity. Refining was one of Koch's original core businesses and FHR remains strategically important to KRLLC, contributing about 40%- 60% of its operating earnings and cash flow, subject to industry cycles. PF CHANG'S: S&P Affirms 'B-' CCR on Lower Business Risk ------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' corporate credit rating on Scottsdale, Ariz.-based Asian themed restaurateur P.F. Chang's China Bistro Inc. The outlook is stable. S&P also affirmed its 'B' issue-level rating on the term loan and revolver and 'CCC' issue-level rating on the company's senior notes. The respective recovery ratings remain unchanged at '2', indicating S&P's expectation of substantial (70%-90%) recovery in the event of a payment default, and '6', indicating negligible (0%-10%) recovery in the event of default. The affirmation coincides with the revision of our business risk assessment on the company to "vulnerable," to reflect P.F. Chang's worsening market position in the highly promotional family and casual restaurant industry, and inability to appeal to changing consumer demands in terms of menu innovation or dining experience. "We don't think the company has realized the significant cost savings we had expected under financial sponsor Centerbridge in recent years," said Standard & Poor's credit analyst Diya Iyer. "We think instead it has experienced adjusted EBITDA margin erosion of 50 basis points in the past year because of gross margin contraction given increased labor costs to support store growth. Other headwinds include a recent credit card breach, executive turnover, and ongoing concentration in both suppliers and geographies, with the majority of restaurants based in California, Arizona, Florida, and Texas." The stable outlook reflects Standard & Poor's expectation that continued operational erosion from weak traffic trends will offset limited debt reduction from excess cash flow generation, resulting in slightly worse credit measures in the coming year. S&P also expects that improved lunch and happy hour offerings at Bistro will provide only limited traffic upside through the end of 2014. POINT BLANK: Asks Court to Extend Deadline to Remove Suits ---------------------------------------------------------- SS Body Armor I, Inc. asked the U.S. Bankruptcy Court in Delaware to extend the deadline to remove lawsuits to December 31. SS Body, formerly known as Point Blank Solutions Inc., said the extension would give them the opportunity "to make fully-informed decisions" concerning removal of any lawsuit involving the company and its affiliated debtors. A court hearing is scheduled for July 24. Objections are due by July 17. About Point Blank Headquartered in Pompano Beach, Florida, Point Blank Solutions, Inc. -- http://www.pointblanksolutionsinc.com/-- designs and produces body armor systems for the U.S. Military, Government and law enforcement agencies, as well as select international markets. The Company maintains facilities in Pompano Beach, Florida, and Jacksboro, Tennessee. The Company's former chief executive officer and chief operating officer were convicted in September 2010 of orchestrating a $185 million fraud. Point Blank Solutions, formerly DHB Industries, filed for Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on April 14, 2010. Laura Davis Jones, Esq., Alan J. Kornfeld, Esq., David M. Bertenthal, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate counsel. Epiq Bankruptcy Solutions serves as claims and notice agent. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Equity Security Holders in the case. Ian Connor Bifferato, Esq., and Thomas F. Driscoll III, Esq., at Bifferato LLC; and Carmen H. Lonstein, Esq., Andrew P.R. McDermott, Esq., and Lawrence P. Vonckx, Esq., at Baker & McKenzie LLP, serve as counsel for the Official Committee of Equity Security Holders. Robert M. Hirsh, Esq., and George P. Angelich, Esq., at Arent Fox LLP, serve as counsel to the Creditors Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq., at the Rosner Law Group LLC, serve as co-counsel. In October 2011, the Debtors sold substantially all assets to Point Blank Enterprises, Inc. The lead debtor changed its name to SS Body Armor I, Inc. following the sale. QUIKSILVER INC: S&P Affirms 'B-' CCR & Revises Outlook to Neg. -------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' corporate credit rating on Huntington Beach, Calif.-based Quiksilver Inc. and revised the outlook to negative from stable. In addition, S&P affirmed its 'CCC+' issue-level rating on the $280 million senior secured notes co-issued with subsidiary QS Wholesale Inc. The recovery rating is '5', indicating S&P's expectation of modest (10% to 30%) recovery for debtholders in the event of a payment default. S&P also affirmed its 'CCC' issue- level rating on the $225 million senior unsecured notes, also co- issued with QS Wholesale. The recovery rating is '6', indicating S&P's expectation of negligible (0% to 10%) recovery for noteholders in the event of a payment default. At the same time, S&P affirmed its 'B-' issue-level rating on the company's EUR200 million European senior unsecured debt. The recovery rating is '4', indicating S&P's expectation of average (30% to 50%) recovery for noteholders in the event of a payment default. "The outlook revision to negative from stable reflects continued poor operating performance, including steeper than expected top line declines in the second fiscal quarter, and our expectation that similar operating trends will continue through the second half of the fiscal year and that its free operating cash flow will be negative in 2015," said credit analyst Jacqueline Hui. "The company's operating performance has deteriorated from fashion misses and intense competition that led to heavy discounting of excess inventory and promotional activity." The rating outlook is negative, reflecting S&P's view that Quiksilver will continue to have soft operating results and weak credit metrics, including high leverage of about 7x, over the next year. S&P expects cash flow generation to be weak but for liquidity to remain adequate given its current cash levels and revolver availability. Downside Scenario S&P could lower the ratings over the next year if the company fails to benefit from its restructuring and cost-saving initiatives or if operating performance weakens further perhaps because of fashion misses or the promotional environment, which results in even weaker free cash flow generation, deterioration in liquidity, and an unsustainable capital structure. Upside scenario Alternatively, S&P could revise the outlook to stable if management is able to gain traction in turning around the business, operating performance improves and stabilizes, such that free cash flow breaks evens and fixed-charge coverage is sustained in the low-1x area. S&P estimates EBITDA would have to increase around 25% for this to occur. REALBIZ MEDIA: Has $869K Net Loss in April 30 Quarter ----------------------------------------------------- RealBiz Media Group, Inc., filed its quarterly report on Form 10-Q disclosing a net loss of $869,745 on $252,560 of real estate media revenue for the three months ended April 30, 2014, compared with a net loss of $563,333 on $319,174 of real estate media revenue for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $5 million in total assets, $2.04 million in total liabilities, and stockholders' equity of $2.96 million. The Company has incurred a net loss of $2.32 million for the six months ended April 30, 2014. At April 30, 2014, the Company had a working capital deficit of $1.95 million, and an accumulated deficit of $12.93 million. It is management's opinion that these facts raise substantial doubt about the Company's ability to continue as a going concern without additional debt or equity financing, according to the regulatory filing. A copy of the Form 10-Q is available at: http://is.gd/A1D8K7 RealBiz Media Group, Inc. formerly Webdigs, Inc. is a Weston, Florida-based provider of digital media and marketing services to the real estate industry. The Company develops advertising campaigns of property listings on multiple formats for web, mobile, interactivity on TV and Video on Demand. REX ENERGY: Moody's Rates $250MM Sr. Unsecured Notes 'B3' --------------------------------------------------------- Moody's Investors Service assigned a B3 rating on Rex Energy Corporation's (REXX) proposed $250 million senior unsecured notes due 2022. Net proceeds from the offering will be used to repay all of the borrowings outstanding under the company's revolving credit facility and for general corporate purposes. The rating outlook is stable. "Moody's views this transaction as a straight refinancing of debt," commented Michael Somogyi, Moody's Vice President -- Senior Analyst. "By returning to full borrowing capacity under the company's revolver and adding cash to the balance sheet, REXX will enhance its liquidity position to further support its development program." Ratings Rationale The B3 rating on the company's proposed $250 million senior unsecured notes reflect their subordinate position relative to the REXX's senior secured revolver. REXX also has $350 million of senior unsecured notes due 2020. The notes are fully and unconditionally guaranteed on a senior unsecured basis and are subordinate to REXX's $375 million borrowing base credit facility ($312.5 million borrowing base pro-forma for the proposed $250 million notes offering). The revolver's first priority claim results in the notes being rated one notch below the B2 CFR under Moody's Loss Given Default Methodology. REXX's B2 Corporate Family Rating (CFR) reflects the company's small size on a proved developed (PD) reserve basis, limited production base, high capital requirements through 2015 and execution risks surrounding its aggressive development program concentrated in the Marcellus and Utica Shale plays in the Appalachian Basin. The B2 CFR is supported by REXX's significant reserve, production and cash flow growth potential that should be realized with the build-out of additional infrastructure. REXX also benefits from a high level of operational control that affords both operational and financial flexibility, an active commodity hedging program that provides for a level of stability of cash flows and enhanced liquidity to support development and production activities. REXX reported record quarterly production of about 20,400 barrels of oil equivalent (BOE) per day in the first quarter ended March 31, 2014 and is approaching 21,500 BOE of daily production volumes through the quarter ended June 30, 2014. Previously announced production curtailments due to delays in the installation of additional field compression capacity in its Butler operated area are expected to be resolved and Moody's project REXX to exit 2014 with production volumes of about 25,000 BOE per day. Its drilling program focused on the Butler and Ohio Utica regions is capital intensive, and a critical focus of ours will be how well the company delivers on its growth objectives. The stable outlook assumes REXX maintains sufficient liquidity and reasonable operating performance over the next 12-18 months. An upgrade could be considered if REXX successfully grows production at sound returns while also maintaining sufficient liquidity and debt/production less than $25,000 BOE per day. An upgrade would also consider the degree of progress on REXX's drilling program and pace of midstream infrastructure build out. A downgrade is possible if debt production is sustained above $30,000 BOE per day, retained cash flow/debt falls below 15%, or liquidity tightens. The principal methodology used in this rating was the Global Independent Exploration and Production Industry published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Rex Energy Corporation is an independent exploration and production company based in State College, PA. REX ENERGY: S&P Assigns 'B-' Rating on $250MM Unsecured Notes ------------------------------------------------------------- Standard & Poor's Ratings Services has assigned its 'B-' issue- level rating (one notch lower than the corporate credit rating) and '5' recovery rating to State College, Pa.-based exploration and production (E&P) company Rex Energy Corp.'s proposed $250 million unsecured notes due 2022. The '5' recovery rating indicates S&P's expectation of modest (10% to 30%) recovery in the event of a payment default. The company plans to use the proceeds from the proposed offering to repay borrowings on its credit facility and for general corporate purposes. The ratings on Rex Energy Corp. reflect S&P's view of the company's "vulnerable" business risk, "aggressive" financial risk, and "adequate" liquidity. The ratings incorporate the company's relatively small size and scale, limited geographic diversity, meaningful proportion of reserves and production exposed to weak natural gas prices, and participation in the capital-intensive and very cyclical E&P industry. Ratings also reflect the company's prospects for increased condensate production, especially natural gas liquids. Ratings List Rex Energy Corp. Corporate Credit Rating B/Stable/-- New Rating Rex Energy Corp. $250 mil unsecd nts due 2022 B- Recovery Rating 5 RIOFORTE INVESTMENTS: To File for Creditor Protection ----------------------------------------------------- Patricia Kowsmann, writing for The Wall Street Journal, reported that Espirito Santo International SA's main unit, Rioforte Investments, is preparing to file for creditor protection in Luxembourg because of mounting pressure to repay debt with funds it doesn't have. According to the report, citing a person familiar with the situation, in the latest sign of stress, Rioforte is unlikely to repay EUR897 million ($1.22 billion) in debt held by Portuguese telecom giant Portugal Telecom SGPS SA. SOURCE INTERLINK: July 21 Hearing on Bid to Sell Retail Business ---------------------------------------------------------------- The Bankruptcy Court will convene a hearing on July 21, 2014, at 2:00 p.m., to consider Source Home Entertainment, LLC, et al.'s motion to: 1. approve the bid procedures to govern the sale of certain assets comprising of the Debtors' retail display manufacturing and installation business; and 2. approve that certain asset purchase agreement dated June 22, 2014, with Cortland Capital Market Services LLC, the purchaser or stalking horse bidder. Objections, if any, were due July 14 at 4:00 p.m. Under the Stalking Horse APA, the stalking horse bidder has agreed to: * credit bid approximately $24 million of its claims under the Debtors' senior secured prepetition loan, subject to certain purchase price adjustments; * assume liabilities for, among other things, contract cure costs and employee- and payroll-related liabilities; * leave behind a significant number of avoidance actions and other assets for the benefit of these chapter 11 estates; and * accept an expense reimbursement capped at $600,000 and no break-up fee as its bid protections -- a package that is favorable to the Chapter 11 estates. The Debtors also request that the Court approve this timeline: * qualified bids for the assets to be submitted by Aug. 22; * the auction will be conducted on Sept. 8; and * the sale hearing to occur by Sept. 11. The stalking horse bid expire Oct. 21, 2014, if a sale transaction is not consummated by that time. A copy of the bidding procedures is available for free at: http://bankrupt.com/misc/SourceInterlink_73_biddingprocess.pdf About Source Home Entertainment and Source Interlink Headquartered in Bonita Springs, Florida, Source Home Entertainment, LLC, manufactures front-end retail checkout displays and is a leading distributor of books, periodicals, and other printed material. Its distribution network spans over 32,500 retail locations in the U.S. and abroad. In the twelve months ended April 30, 2014, Source Home generated revenues totaling approximately $600 million on a consolidated basis. As of March 31, 2014, Source Home had assets (not including goodwill or intangibles) of $205 million and liabilities of approximately $290 million. Source Home, Source Interlink Manufacturing, LLC, and other affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-11553) on June 23, 2014, to sell their front-end retail display fixtures business to lenders, absent higher and better offers. The Debtors are winding down their books distribution business. The Debtors have tapped Kirkland & Ellis LLP as general bankruptcy and corporate counsel; Young Conaway Stargatt & Taylor, LLP, as co-counsel, FTI Consulting, Inc., as crisis and turnaround advisor; and Kurtzman Carson Consultants, LLC, as claims agent. SOURCE INTERLINK: Meeting of Creditors Scheduled for July 22 ------------------------------------------------------------ Roberta A. DeAngelis, U.S. Trustee for Region 3, will convene a meeting of creditors in the Chapter 11 cases of Source Home Entertainment, LLC, et al., on July 22, 2014, at 9:00 a.m. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, 5th Floor, Room 5209, Wilmington, Delaware. The deadline to file a complaint to determine dischargeability of certain debts is scheduled for Sept. 20, 2014. About Source Home Entertainment and Source Interlink Headquartered in Bonita Springs, Florida, Source Home Entertainment, LLC, manufactures front-end retail checkout displays and is a leading distributor of books, periodicals, and other printed material. Its distribution network spans over 32,500 retail locations in the U.S. and abroad. In the twelve months ended April 30, 2014, Source Home generated revenues totaling approximately $600 million on a consolidated basis. As of March 31, 2014, Source Home had assets (not including goodwill or intangibles) of $205 million and liabilities of approximately $290 million. Source Home, Source Interlink Manufacturing, LLC, and other affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-11553) on June 23, 2014, to sell their front-end retail display fixtures business to lenders, absent higher and better offers. The Debtors are winding down their books distribution business. The Debtors have tapped Kirkland & Ellis LLP as general bankruptcy and corporate counsel; Young Conaway Stargatt & Taylor, LLP, as co-counsel, FTI Consulting, Inc., as crisis and turnaround advisor; and Kurtzman Carson Consultants, LLC, as claims agent. SP HOLDCO I: Moody's Assigns B3 Corp. Family Rating; Outlook Neg. ----------------------------------------------------------------- Moody's Investors Service assigned a B3 Corporate Family Rating and B3-PD Probability of Default Rating to SP HoldCo I, Inc. the indirect parent of Surgery Center Holdings ("Surgery Partners"). At the same time, Moody's assigned a B1 (LGD 2) rating to Surgery Partners' $900 million senior secured first lien credit facilities, consisting of a $80 million revolving credit facility expiring in 2019 and a $820 million first lien term loan due 2020. Concurrently, Moody's assigned a Caa2 (LGD 5) rating to Surgery Partners' proposed $440 million second lien term loan due 2021 and a Caa2 (LGD 6) rating to SP HoldCo's $100 million PIK term loan due 2021. The rating outlook is negative. On June 13, 2014, Surgery Partners announced the acquisition of Symbion, Inc. for a total purchase price of $792 million. Proceeds from the proposed financing will be used to fund the acquisition, refinance existing debt and fund a series of planned future acquisitions. Symbion is an owner and operator of short-stay surgical facilities providing, non-emergency surgical procedures, including orthopedics, pain management and gastroenterology. The following is a summary of Moody's ratings actions: SP HoldCo I, Inc.: Ratings assigned: Corporate Family Rating at B3 Probability of Default Rating at B3-PD $100 million PIK term loan due 2021 at Caa2 (LGD 6) Surgery Center Holdings, Inc.: Ratings assigned: $80 million senior secured revolver due 2019 at B1 (LGD 2) $820 million senior secured first lien term loan due 2020 at B1 (LGD 2) $440 million senior secured second lien term loan due 2021 at Caa2 (LGD 5) Ratings to be withdrawn at close: Surgery Center Holdings, Inc.: Corporate Family Rating, B3 Probability of Default Rating, B3-PD $30 million senior secured revolving credit facility expiring 2018 at B1 (LGD 3) $315 million senior secured first lien term loan due 2019 at B1 (LGD 3) $210 million senior secured second lien term loan due 2020 at Caa2 (LGD 5) Rating Rationale The B3 Corporate Family Rating reflects Surgery Partners' very high leverage, which will increase following the acquisition of Symbion, and the company's aggressive acquisition and shareholder friendly financial policy. Moody's estimates that the pro forma debt to EBITDA for the LTM period ending March 31, 2014 would have been approximately 8.4 times. Furthermore, the ratings are constrained by a sluggish economic environment and the high underemployment rate and increasing healthcare expense burden on patients that will result in sluggish procedure volumes in the year ahead. In addition, the potential for rate compression from government sponsored programs (mostly Medicare) and commercial payors over the longer-term is a concern. The rating benefits from the industry's long-term growth prospects for the sector, as many patients and payors prefer the outpatient environment (primarily due to lower cost and better outcomes) for certain specialty procedures. The negative outlook reflects Moody's concern with Surgery Partners' heightened financial leverage resulting from its aggressive financial policy and the challenges it will face integrating Symbion. The rating could be downgraded if the company is unable to improve its financial performance, or if it stumbles in its integration of Symbion. Additionally, the company has no capacity at its current rating level for additional financial leverage. Ratings could also be downgraded if liquidity deteriorates or free cash flow turns negative. Although an upgrade is unlikely in the near-term, if the company is able to integrate Symbion without financial or operational disruption, while maintaining good liquidity, the rating could be upgraded. More specifically, for a rating upgrade to occur given the company's size and debt leverage, debt to EBITDA would have to be sustained around 6 times. The principal methodology used in this rating was the Global Healthcare Service Providers Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Surgery Partners is an operator of outpatient surgery hospitals that provide a diversified core of surgical procedures in pain management, orthopedics, gastrointestinal, ophthalmology, ear, nose and throat, general surgery and urology. SCSJ ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: SCSJ Enterprises, Inc. 2295 Town Lake Pkwy Woodstock, GA 30189 Case No.: 14-63555 Chapter 11 Petition Date: July 14, 2014 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Kenneth Mitchell, Esq. GIDDENS, MITCHELL & ASSOCIATES, P.C. Suite 555, 3951 Snapfinger Parkway Decatur, GA 30035 Tel: 770-987-7007 Email: gmapclaw1@gmail.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Shandton Williams, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/ganb14-63555.pdf SIGNAL ELECTRIC: Default Judgment in "Ha" Suit Vacated ------------------------------------------------------ Judy Ha sued Signal Electric Inc. after she was hit by a drunk driver in an intersection where Signal Electric was installing a new traffic light. Signal Electric was in Chapter 11 bankruptcy, so Ha sought and received permission to proceed. Ha then asked Signal Electric's bankruptcy attorney if he would accept service of process. The attorney agreed and executed an acceptance of service. However, the attorney sent the summons and complaint to Signal Electric's bankruptcy financial advisor, who forwarded them to the wrong insurance company and not to Signal Electric. When Signal Electric failed to appear, the trial court entered an order of default and default judgment. Signal Electric eventually received notice and moved to vacate under CR 60(b)(5) for improper service of process; CR 60(b)(1) for mistake, inadvertence, or excusable neglect; and CR 60(b)(11) for extraordinary circumstances. The trial court granted Signal Electric's motion and vacated the default judgment. "We affirm," the Court of Appeals of Washington, Division One, ruled in a July 14, 2014 Opinion available at http://is.gd/M86rAJ from Leagle.com. The case is, JUDY HA, Appellant, v. SIGNAL ELECTRIC, INC., a Washington corporation, Respondent, JUANITA MARS aka JUANITA WRIGHT aka JUANITA CARPENTER, an individual; AEG LIVE NW, LLC d/b/a SHOWBOX SODO, a Washington limited liability company; and CITY OF SEATTLE, a local government entity, Defendants, No. 70423- 1-I (Wash. App.). Counsel for Appellant is: Douglas C. McDermott, Esq. MCDERMOTT NEWMAN, PLLC 1001 4th Ave Ste 3200 Seattle, WA, 98154-1003 Counsel for Respondent: Steven George Wraith, Esq. LEE SMART PS INC 701 Pike St Ste 1800 Seattle, WA, 98101-3929 Based in Kent, Washington, Signal Electric Inc. filed for Chapter 11 bankruptcy protection (Bankr. W.D. Wash. Case No. 11-12105) on Feb. 26, 2011. Judge Marc Barreca presides over the case. J Todd Tracy, Esq., at Crocker Law Group PLLC, represents the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. TACTICAL INTERMEDIATE: Unsecured Creditors May Receive Nothing -------------------------------------------------------------- Tactical Intermediate Holdings, Inc., et al., in the disclosure statement explaining their plan of liquidation filed with the U.S. Bankruptcy Court for the District of Delaware, stated that holders of general unsecured claims may receive nothing under the liquidating plan if there are no more assets left to distribute. The Prepetition Senior Secured Claim (Class 1) will be paid all cash sale proceeds from the sale of the Debtors' apparel line, less the amount of the Administrative Reserve, and all cash sale proceeds from the sale of the Debtors' footwear line. Secured Noteholder Claims (Class 2) will receive payment in cash after distribution of after payment of the DIP Facility Claim, the Professional Claims, all Administrative Claims, all Priority Claims, the Distribution Reserves and the Class 1 Prepetition Senior Secured Claim. Miscellaneous Secured Claims (Class 3) will receive (i) Cash in an amount equal to the lesser of (a) the amount of Allowed Secured Claim and (b) the value of the Debtors' property securing the Allowed Secured Claim currently in the possession of the Debtors minus the amount of claims secured by the property with legal priority senior to the lien priority of the holder of the Allowed Class 2 Claim or (ii) the property securing the Allowed Class 2 Claim. The holder of each Allowed Class 4 Priority Non-Tax Claim will receive its Pro Rata share of all Plan Assets remaining after payment in full of Post-Effective Date Claims incurred by the Plan Administrator, Allowed Professional Claims and Allowed Claims in Class 2 until Allowed Class 3 Claims are paid in full. Holders of Allowed Class 5 General Unsecured Claim will receive its Pro Rata share of the Plan Assets after payment of all Administrative Claims, Priority Claims, Allowed Class 1 Claims, Allowed Class 2 Claims, Allowed Class 3 Claims, Allowed Class 4 Claims and the funding of the Plan Administrator Expense Reserve. If, as of the Final Distribution Date, there are no available Plan Assets to satisfy any Allowed General Unsecured Claims, Holders of General Unsecured Claims will not receive any distribution on account of such General Unsecured Claims. The holders of the Allowed Interests and Claims in Class 6 will have their Interests and Claims against the Debtors extinguished as of the Effective Date and will receive no distributions under the Plan. A full-text copy of the Disclosure Statement dated July 8 is available at http://bankrupt.com/misc/TACTICALds.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: Has Interim Approval of $2.8MM DIP Loan -------------------------------------------------------------- Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware gave Tactical Intermediate Holdings, Inc., et al., interim authority to obtain up to $2,800,000 in senior secured postpetition financing from Wells Fargo Bank, N.A., as lender. The Debtors are also given interim authority to use cash collateral securing their prepetition indebtedness. Under the DIP Loan Agreement, the Debtors are required by the DIP Lender to close the sale of their assets on or before Sept. 12, 2014. The hearing to consider final approval of the DIP Facility is scheduled for July 30, at 12:30 p.m. (Eastern time). Objections are due on or before July 23 and must be served to: * counsel to the Debtors: Morton R. Branzburg, Esq. Domenic E. Pacitti, Esq. KLEHR HARRISON HARVEY BRANZBURG LLP 1835 Market Street, Suite 1400 Philadelphia, PA 19103 * counsel to the Prepetition Secured Lender and DIP Lender: J. Michael Booe, Esq. Felton E. Parrish, Esq. Nathan P. Lebioda, Esq. WINSTON & STRAWN LLP 100 North Tryon Street Charlotte, NC 28202-1078 -- and -- Francis A. Monaco, Jr., Esq. WOMBLE CARLYLE SANDRIDGE & RICE, PLLC 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 * counsel to the Subordinated Lender: Joshua A. Sussberg, Esq. KIRKLAND & ELLIS LLP 601 Lexington Avenue New York, NY 10022-4611 A full-text copy of the Interim DIP Order with Budget is available at http://bankrupt.com/misc/TACTICALdipord0709.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: Has Interim OK to Pay Critical Vendors ------------------------------------------------------------- Tactical Intermediate Holdings, Inc., et al., sought and obtained interim authority from the U.S. Bankruptcy Court for the District of Delaware to pay or honor prepetition critical vendor claims, provided that the Debtors pay only up to a maximum aggregate cap of $187,000. The hearing to consider final approval of the request will be held on July 30, 2014, at 12:30 p.m. (prevailing Eastern time). Objections must be filed on or before July 27. In the event no objections to the entry of the final order are timely received, the Court may enter the final order without need for the final hearing. 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: Can Employ Prime Clerk as Claims Agent ------------------------------------------------------------- Tactical Intermediate Holdings, Inc., et al., are authorized by the U.S. Bankruptcy Court for the District of Delaware to employ Prime Clerk LLC as claims and noticing agent. 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: Court Issues Joint Administration Order -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware issued an order directing the procedural consolidation of the Chapter 11 cases of Tactical Intermediate Holdings, Inc., and its debtor affiliates under Case No. 14-11659. 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. TELEPHONE AND DATA: Fitch Cuts Issuer Default Ratings to 'BB+' -------------------------------------------------------------- Fitch Ratings has downgraded the Issuer Default Ratings (IDRs) and long-term, senior unsecured debt ratings of Telephone and Data Systems, Inc. (TDS) and its subsidiary United States Cellular Corp. (USM) to 'BB+' from 'BBB-'. USM's ratings consider the consolidated ratings at TDS. The Rating Outlook remains Stable. Key Rating Drivers The downgrade reflects Fitch's belief that in 2014 USM's wireless operations will continue to struggle with the highly competitive wireless environment, leading to weak EBITDA margins and lower EBITDA. While subscriber trends in core markets may stabilize in the second half of 2014, the billing system and related issues that surfaced in late 2013 and in early 2014, as well as higher losses on equipment driven by strong smartphone sales, are expected to suppress 2014 operating profitability. Billing system issues that contributed to higher voluntary churn in the fourth quarter of 2013 have declined, but higher levels of involuntary churn occurred in the first quarter of 2014 as a small but impactful percentage of customers had stopped paying their bills and the company dropped their service. Postpaid subscriber additions at USM have been under material pressure for several years. In the fourth quarter of 2013, USM began selling the iPhone which Fitch believes may reduce voluntary churn over time, and should the company succeed in improving gross additions, may eventually lead to subscriber growth. USM's gross adds in its core markets improved in the first quarter of 2014 by approximately 12% to reach 197,000, but Fitch believes continued improvement is needed to generate subscriber growth even if total postpaid churn can return to recent historical levels approximating 1.6%. Moreover, increased losses on equipment are expected as USM loads more costly 4G LTE smartphones onto its network, with the impact being offset by increased service revenue over time. Losses on equipment could come down if there is a strong uptake of equipment installment plans. The ratings at TDS, and by extension, USM, reflect the current strong liquidity position owing to the substantial cash balances, conservative balance sheet, undrawn revolving credit facilities and long dated maturities. The consolidated company does not have any material maturities until 2033. Fitch expects TDS's gross leverage to rise to approximately 3.0x- 3.1x at yearend 2014, up from 2.1x at year-end 2013. Fitch has included a portion of partnership distributions (at a level which Fitch views is sustainable) received from entities it does not control in its calculations. Assuming participation in upcoming wireless spectrum auctions, the sale of its non-core tower business, the completion of the acquisition of the BendBroadband group of companies and continued wireless network investment, Fitch expects leverage to remain around the 3.0x-3.1x level in the intermediate term. Fitch expects free cash flow (FCF) levels in 2014 and 2015 to be negative due to the continued high level of capital investment and weaker wireless performance. In 2013, FCF was a negative $444 million. FCF would have been less severely negative if adjusted to remove the taxes paid on asset sale gains and the portion of USM's special dividend paid to noncontrolling shareholders. Fitch notes that this is a significant change from positive levels of FCF, which through 2011 exceeded $200 million per annum. The sale of noncore assets has mitigated the effect of negative FCF on USM and TDS. USM is in the process of selling the wireless towers located in the Chicago and St. Louis markets that were sold to Sprint. This follows the sale of certain wireless spectrum licenses in 2013 and 2014 for more than $400 million. In relation to its total outstanding debt of $1.721 billion at March 31, 2014, TDS has relatively high balances of cash and short-term investments, which amounted to $873 million and $40 million, respectively. A portion of the company's cash balance is expected to be used to finance the $261 million cash acquisition of BendBroadband in the third quarter of 2014. Per policy, the company's maturities are very long. The earliest notes at TDS are due in 2045 ($116 million) and at USM the earliest maturity is in 2033 ($532 million). At TDS, the $400 million, undrawn revolving credit facility matures in December 2017, and at USM, the $300 million undrawn revolving credit facility also matures in December 2017. TDS has authorized share repurchase programs at both TDS and USM and under both programs has repurchased a total of approximately $15 million over the last 12 months ending March 31, 2014. Future repurchases are expected to continue at a moderate level. Rating Sensitivities Negative Rating Action: Longer term, Fitch believes TDS's ability to grow revenues and cash flows while competing effectively against much larger national operators is key to maintaining its 'BB+' IDR. In addition, if gross leverage -- calculated including partial credit for material wireless partnership distributions in EBITDA -- approaches 3.5x, a negative action could be contemplated. Positive Rating Action: Fitch believes that competitive factors, current subscriber trends and the company's relative position in the wireless industry would not likely allow a positive rating action at this time. TEM ENTERPRISES: Court Approves Cash Collateral Use for 60 Days --------------------------------------------------------------- Bankruptcy Judge August B. Landis signed off on July 2, 2014, a stipulation and agreed order authorizing TEM Enterprises' use of cash collateral. The stipulation entered between the Debtor and the so-called Vx Entities, including V31-A&E LLC, the lender, the secured creditor as to the collateral, and creditor Triton Aviation California, Inc., provides for the use of the lender's cash collateral to meet the Debtor's ordinary operating expenses. The Debtor will be authorized to use cash collateral, subject to the occurrence of an event of default, until the date which is 60 days from the date of the cash collateral order, unless otherwise extended in writing. The stipulation also provided that: 1. the Debtor agreed that at least $105,000 of the $150,000 set forth in the approved budget for aircraft lease payments is payable to Triton; 2. the Debtor agreed that approximately $90,000 of the $130,000 set forth in the approved budget for aircraft maintenance reserves is also payable to Triton; and 3. the cash collateral order constitutes adequate protection for the Debtor's use, consumption, sale, collection or other disposition of any of the collateral (including the cash collateral). On June 28, the Debtor, in response to Triton's opposition to motion for approval of stipulation, said Triton, an aircraft lessor, has not filed a motion for adequate protection, nor has Triton met its burden to demonstrate that it is not adequately protected under the circumstances. Triton has opposed to the motion stating that the budget completely leave out any payment to Triton, the budget demonstrates that there will be negative cash flow and that the best case scenario is an ending cash balance of $61,104, which is short of the amounts that would be necessary to cure the defaults under the Triton Lease and pay all of the other costs and expenses of the estate. On June 17, the Debtor requested for permission to use cash collateral. On June 16, the Debtor entered into a joint stipulation and agreed order authorizing the use of cash collateral. Copies of the stipulations are available for free at: http://bankrupt.com/misc/TEMENTERPRISES_102_cashcollstip.pdf http://bankrupt.com/misc/TEMENTERPRISES_41_cashcollstip.pdf http://bankrupt.com/misc/TEMENTERPRISES_39_cashcollstip.pdf Vx Entities are represented by: David Weitman, Esq. K&L GATES LLP 1717 Main Street, Suite 2800 Dallas, TX 75201 Tel: 214-939-5500 Fax: 214-939-5849 E-mail: david.weitman@klgates.com - and - Bob L. Olson, Esq. SNELL & WILMER 3883 Howard Hughes Pkwy No. 1100 Las Vegas, NV 89169-5958 Tel: (702) 784-5295 E-mail: bolson@swlaw.com Triton Aviation California, Inc. is represented by: H. Mark Mersel, Esq. Natalie B. Daghbandan, Esq. BRYAN CAVE LLP 3161 Michelson Drive, Suite 1500 Irvine, CA 92612-4414 Tel: (949) 223-7000 Fax: (949) 223-7100 E-mails: mark.mersel@bryancave.com natalie.daghbandan@bryancave.com The Debtor is represented by: Ryan J. Works, Esq. Amanda M. Perach, Esq. McDONALD CARANO WILSON LLP 2300 West Sahara Avenue, 12th Floor Las Vegas, NV 89102 Tel: (702) 873-4100 Fax: (702) 873-9966 E-mail: rworks@mcdonaldcarano.com aperach@mcdonaldcarano.com About Tem Enterprises Tem Enterprises dba Xtra Airways filed a Chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 14-13955) on June 4, 2014. Judge August B. Landis oversees the case. The Debtor disclosed $6,129,714 in assets and $18,386,432 in liabilities as of the Chapter 11 filing. Lisa Dunn signed the petition as president. McDonald Carano Wilson LLP serves as the Debtor's counsel. TEM ENTERPRISES: Files List of 20 Largest Unsecured Creditors ------------------------------------------------------------- Tem Enterprises dba Xtra Airways filed with the U.S. Bankruptcy Court for the District of Nevada a list of its 20 largest unsecured creditors, disclosing: Name of Creditor Amount of Claim --------------- --------------- Southern Sky Air & Tours, LLC $4,169,398 c/o Chapter 7 Trustee Gina O'Neill, Esq. 1800 West Park drive, Suite 400 Westborough, MA 01581-3941 Triton Aviation California, Inc. $2,870,376 55 Green Street, Suite 500 San Francisco, CA 94111 Stambaugh Aviation $1,840,453 1000 Jetport Road Brunswick, GA 31525 V43-A&E LLC $1,769,659 c/o Wells Fargo Bank Northwest, N.A. Corporate Trust Lease Group 260 N. Charles Lindbergh Dr. Salt Lake City, UT 84116 Flugfelagid Atlanta ehf. dba AAI $1,611,938 Hlidasmari 3, 201 Kopavogi, Iceland MSA V $1,439,755 c/o AWAS Aviation Services Inc. 444 Madison New York, NY 10022 V37X-737 LLC $1,120,272 915 Front Street San Francisco, CA 94111 The Insurance Group, Inc. $483,489 200E Southampton Dr. Columbia, MO 65203 CXP Management LLC $280,500 805 W. Idaho Street Suite 400 Boise, ID 83702 Aerp Turbine, Inc. $271,056 P.O. Box 731891 Dallas, TX 75373-1891 VISA $172,155 CSI Aviation, Inc. $148,952 Airplanes, Inc. $136,628 MTU Maintenance $128,943 Boeing Commercial Airplanes $122,106 TP Aerospace Leasing $116,417 Chemoil Corporation $79,166 Federal Express Corporation $72,698 American Express $69,326 Cozen O'Connor $62,893 About Tem Enterprises Tem Enterprises dba Xtra Airways filed a Chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 14-13955) on June 4, 2014. Judge August B. Landis oversees the case. The Debtor disclosed $6,129,714 in assets and $18,386,432 in liabilities as of the Chapter 11 filing. Lisa Dunn signed the petition as president. McDonald Carano Wilson LLP serves as the Debtor's counsel. TEM ENTERPRISES: Files Schedules of Assets and Liabilities ---------------------------------------------------------- TEM Enterprises dba XTRA Airways filed on June 26, 2014, with the U.S. Bankruptcy Court for the District of Nevada its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $6,129,714 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $215,008 E. Creditors Holding Unsecured Priority Claims $37,219 F. Creditors Holding Unsecured Non-Priority Claims $18,134,205 ----------- ----------- Total $6,129,714 $18,386,432 A copy of the schedules is available for free at: http://bankrupt.com/misc/TEMENTERPRISES_85_sal.pdf The Debtor sought an extension of its deadline to file schedules of assets and liabilities; or to provide required information and statement of financial affairs. About Tem Enterprises Tem Enterprises dba Xtra Airways filed a Chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 14-13955) on June 4, 2014. Judge August B. Landis oversees the case. The Debtor estimated assets and debts of at least $10 million. Lisa Dunn signed the petition as president. McDonald Carano Wilson LLP serves as the Debtor's counsel. TEM ENTERPRISES: July 23 Hearing on Bid to Assume Accountemps Deal ------------------------------------------------------------------ The Bankruptcy Court will convene a hearing on July 23, 2014, at 1:30 p.m., to consider Tem Enterprises' motion to assume and cure executory contract with Accountemps. On May 12, the Debtor and Accountemps entered into an agreement which provided for the temporary employment of Robert Godfrey as the chief financial officer of the Debtor. The Debtor related that the assumption of the agreement is critical to its ultimate success. Accountemps stated that it would not allow for the continued services of Mr. Godfrey unless it was paid in full. Due to the Debtor's bankruptcy filing, its first payment to Accountemps was not honored by the bank. As of the Petition Date, the Debtor owes Accountemps a total of $10,277 for the work performed by Godfrey prior to bankruptcy. According to the Debtor, permitting the cure and assumption of the agreement will allow the CFO to continue to provide services to the Debtor, pursuant to the agreement. About Tem Enterprises Tem Enterprises dba Xtra Airways filed a Chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 14-13955) on June 4, 2014. Judge August B. Landis oversees the case. The Debtor disclosed $6,129,714 in assets and $18,386,432 in liabilities as of the Chapter 11 filing Lisa Dunn signed the petition as president. McDonald Carano Wilson LLP serves as the Debtor's counsel. TLO LLC: Wants to Distribute $35-Mil. to Tech Inc. -------------------------------------------------- TLFO, LLC, the post-confirmation Debtor, and the Oversight Committee, filed a joint motion for authority to make interim distributions under the Debtor's Confirmed Plan of Liquidation. The Debtor on March 7, 2013 filed an Amended Plan of Liquidation. The Plan was confirmed by the Bankruptcy Court on April 30, 2014. Pursuant to the Plan, Robert C. Furr was appointed the Plan Disbursing Agent for the Debtor, with the authority, among other things, to propose and make distributions to holders of allowed claims and interests. The Debtor presently holds $123,504,378 in net proceeds from the sale of its assets to TransUnion. The Debtor further anticipates the collection of an additional $5,832,822 from receivables in connection with the sale and proceeds from the expected settlement, which will bring the total amount available for distribution to $129,337,199. Under the terms of the Plan, the Plan Disbursing Agent is tasked with making distributions to holders of allowed unsecured claims in Class 3 of the Plan; provided, however, that no distribution to the holders of the allowed unsecured claims can occur "unless and until all Allowed Administrative Claims, all Allowed Post- Confirmation Administrative Claims, all Allowed Priority Claims, and all Allowed Claims in Classes 1 and 2 have been paid in full, reserved or otherwise resolved, and/or included in or accounted for in the Distribution at issue." Technology Investors, Inc. ("Tech Inc.") filed Claim No. 35 for its secured claim of $87,110,686. Tech Inc. also filed Claim No. 36 to preserve any unsecured claim that it may have as a result of its potentially being an undersecured creditor. In addition, Tech Inc. holds a Class A Equity Interest in the Debtor in an amount not less than 47.87 percent. Prior to confirmation of the Plan, two constituencies of equity interest holders instituted two separate adversary proceedings against Tech Inc. seeking to recharazterize the Tech Inc. claism to equity in the Debtor. The Plan Disbursing Agent, the Debtor, the Committee and their respective professionals have determined that a conservative interim Distribution of $35,000,000 can be made to Tech Inc. at this time, which Distribution will cut off the accrual of interest at the default rate on $35,000,000 pending the outcome or resolution of the Adversary Proceedings. They believe that Tech Inc. would receive in excess of $48 million even if it loses the Adversary Proceedings, because it owns 47.87 percent of Class A Equity interest in the Debtor. The Plan Disbursing Agent, the Debtor, and the Committee believe that the Adversary Proceedings potentially could last for two years or longer, including through appeals. Due to the size of the Secured Claim and the default interest accruing on the Secured Claim, they believe that the default interst that is estimate to accrue would exceed $11,000,000. However, a Distribution to Tech Inc. of $35,000,000 will greatly reduce the outstanding obligation to Tech Inc., which will in turn greatly reduce the amount of default interest that would need to be reserved by the Debtor and the Plan Disbursing Agent. Such Distribution and reduced reserve would then enable the Debtor and Plan Disbursing Agent to make a significant interim Distribution of 80% to Holders of Class 3 Allowed Unsecured Claims. The Oversight Committee retained as counsel: Paul J. Battista, Esq. GENOVESE JOBLOVE & BATTISTA P.A. 100 S.E. Second Street, 44th Floor Miami, FL 33131 Tel: (305) 349-2300 Fax: (305) 349-2310 E-mail: pbattista@gjb-law.com As reported in the Troubled Company Reporter on May 19, 2014, citing report from Bill Rochelle, the bankruptcy columnist for Bloomberg News, said the Debtor won court approval for a liquidating Chapter 11 plan with at least $18.7 million for distribution to shareholders, assuming the deceased founder's secured claim of $91.1 million isn't knocked out. TCR noted, on March 13, 2014, Judge Paul G. Hyman approved the disclosure statement explaining TLO LLC's Amended Plan. The Plan, filed March 7, projects that $18 million will be available for equity interest holders, assuming that the secured claim of Hank Asher, the Debtor's deceased founder, will be allowed in full. If the secured claim of TI is not recharacterized, then TI will be entitled to its $89 million claim, including default interest, attorneys' fees and costs -- the current amount of which is in excess of $91 million and began accruing interest at the default rate of 6.25% on January 24, 2014. The Plan proposes that $16.5 million is used for full payment of unsecured creditors. About TLO LLC nka TLFO LLC TLO LLC, a provider of risk-mitigation services, filed a petition for Chapter 11 reorganization (Bankr. S.D. Fla. Case No. 13-bk20853) on May 9, 2013, in West Palm Beach, Florida, near the company's headquarters in Boca Raton. The petition was signed by E. Desiree Asher as CEO. Judge Paul G. Hyman, Jr., presides over the case. Robert C. Furr, Esq., and Alvin S. Goldstein, Esq., at Furr & Cohen, serve as the Debtor's counsel. Bayshore Partners, LLC is the Debtor's investment banker. Thomas Santoro and GlassRatner Advisory & Capital Group, LLC are the Debtor's financial advisors. Paul J. Battista, Esq., and Mariaelena Gayo-Guitian, Esq., at Genovese, Joblove & Battista, P.A., represent the Official Committee of Unsecured Creditors as counsel. The Debtor disclosed assets of $46.6 million and liabilities of $109.9 million, including $93.4 million in secured claims. The principal lender is Technology Investors Inc., owed $89 million. TII is owned by the estate of Hank Asher, the company's primary owner who died this year. There is $4.6 million secured by computer equipment. TLO LLC: Oversight Committee Hires GlassRatner as Fin'l Advisor --------------------------------------------------------------- The Post-Confirmation Oversight Committee of TLFO LLC asks the U.S. Bankruptcy Court for the Southern District of Florida for authority to employ Thomas Santoro and GlassRatner Advisory & Capital Group, LLC, as its financial advisor. The firm will: a) assist in the review of financial information distributed by the Liquidating TLFO and the Plan Disbursing Agent, to creditors and others, including, but not limited to, proposed interim distributions to respective creditor classes; b) assist the Oversight Committee in analyzing the claims of the Debtor's creditors and in negotiating with such creditors; and c) monitor and assist the Oversight Committee in connection with the pending objections to the claims asserted by Technology Investors, Inc., and the pending Adversary Proceedings as well as any claims that may be asserted by the Oversight Committee in connection therewith: d) provided Other services as requested by the Oversight Committee. The hourly rates for personnel at GlassRatner are: Personnel Rate --------- ---- Thomas Santoro $425 William King $350 Other Professionals $150-$295 The Oversight Committee assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached at: GLASSRATNER ADVISORY & CAPITAL GROUP, LLC 1101 Brickell Avenue, Suite S-503 Miami, FL 33131 Tel: (305) 358-6092 Fax: (305) 358-7039 About TLO LLC nka TLFO LLC TLO LLC, a provider of risk-mitigation services, filed a petition for Chapter 11 reorganization (Bankr. S.D. Fla. Case No. 13-bk20853) on May 9, 2013, in West Palm Beach, Florida, near the company's headquarters in Boca Raton. The petition was signed by E. Desiree Asher as CEO. Judge Paul G. Hyman, Jr., presides over the case. Robert C. Furr, Esq., and Alvin S. Goldstein, Esq., at Furr & Cohen, serve as the Debtor's counsel. Bayshore Partners, LLC is the Debtor's investment banker. Thomas Santoro and GlassRatner Advisory & Capital Group, LLC are the Debtor's financial advisors. Paul J. Battista, Esq., and Mariaelena Gayo-Guitian, Esq., at Genovese, Joblove & Battista, P.A., represent the Official Committee of Unsecured Creditors as counsel. The Debtor disclosed assets of $46.6 million and liabilities of $109.9 million, including $93.4 million in secured claims. The principal lender is Technology Investors Inc., owed $89 million. TII is owned by the estate of Hank Asher, the company's primary owner who died this year. There is $4.6 million secured by computer equipment. TLO LLC: Withdraws Bid to Amend Employment of Ver Ploeg ------------------------------------------------------- TLFO LLC informed the U.S. Bankruptcy Court for the Southern District of Florida that it withdraws the request to modify the terms of employment of special counsel, Law Firm of Ver Ploeg & Lumpkin, for representation in insurance litigation to make it a contingency free arrangement. As reported in the Troubled Company Reporter on March 31, 2014, the Debtor requested that the Court amend the order dated July 1, 2013, authorizing the employment of Ver Ploeg & Lumpkin, P.A., as special counsel in insurance litigation. The Debtor, in its March 20 application, said that it is the beneficiary of a $40 million key man life insurance policy on its founder, Hank Asher, who passed away in January 2013. The policy proceeds have not yet been paid and represent a significant asset of the bankruptcy estate. The Debtor proposed that the terms of employment of the firm be on a contingency fee basis going forward from March 3, 2014. The Court has previously approved the employment on a general hourly basis. The Debtor proposed this fee arrangement: a. the fee will be on a contingency basis of 18% of any recovery in the contract case; b. the fee will be on a contingency basis of 20% if an appeal is taken in the contract case; c. if any bad faith damages are awarded, the fee will be 40%; d. in addition, the Debtor will pay all costs of the litigation pursuant to the term of the contingency fee agreement. As of the date of the modification of the fee agreement, the Debtor said it has been billed $258,000 in fees. The amount of $113,000 has been paid to Ver Poleg until January 2014. About TLO LLC nka TLFO LLC TLO LLC, a provider of risk-mitigation services, filed a petition for Chapter 11 reorganization (Bankr. S.D. Fla. Case No. 13-bk20853) on May 9, 2013, in West Palm Beach, Florida, near the company's headquarters in Boca Raton. The petition was signed by E. Desiree Asher as CEO. Judge Paul G. Hyman, Jr., presides over the case. Robert C. Furr, Esq., and Alvin S. Goldstein, Esq., at Furr & Cohen, serve as the Debtor's counsel. Bayshore Partners, LLC is the Debtor's investment banker. Thomas Santoro and GlassRatner Advisory & Capital Group, LLC are the Debtor's financial advisors. Paul J. Battista, Esq., and Mariaelena Gayo-Guitian, Esq., at Genovese, Joblove & Battista, P.A., represent the Official Committee of Unsecured Creditors as counsel. The Debtor disclosed assets of $46.6 million and liabilities of $109.9 million, including $93.4 million in secured claims. The principal lender is Technology Investors Inc., owed $89 million. TII is owned by the estate of Hank Asher, the company's primary owner who died this year. There is $4.6 million secured by computer equipment. TLO LLC: Oversight Panel Taps Genovese Joblove as Counsel --------------------------------------------------------- The Post-Confirmation Oversight Committee of TLFO LLC asks the U.S. Bankruptcy Court for the Southern District of Florida for permission to employ Paul J. Battista, Esq. and Genovese Joblove & Battista, P.A., as its counsel. The firm is expected to perform services that will be necessary to finalize the liquidation of the Debtor's assets and payment in full of all allowed unsecured claims (plus Post Petition Interest) in accordance with the amended plan. The firm will: a) advise the Oversight Committee with respect to its rights, powers, and duties post confirmation; b) assist and advise the Oversight Committee in its consultations with the Plan Disbursing Agent in respect of the liquidation of the TLFO assets; c) assist and advise the Oversight Committee concerning retention of Post Confirmation Professionals; c) assist the Oversight Committee in analyzing the claims of the Debtor's creditors and in negotiating with such creditors; d) monitor and assist the Oversight Committee in connection with the pending objections to the claims asserted by Technology Investors, Inc., and the pending Adversary Proceedings as well as any claims that may be asserted by the Oversight Committee in connection therewith: e) assist and advise the Oversight Committee with respect to its communications with the other professionals and general creditor body regarding matters related to the liquidation of the TLFO assets. f) represent the Oversight Committee at all hearings and other proceedings in this Chapter 11 case; g) review and analyze all applications, motions, orders, and pleadings filed with the Court and advise the Oversight Committee as to their propriety; h) assist the Oversight Committee in preparing pleadings and applications as may be necessary in furtherance of the Oversight Committee's interests and objectives; and i) perform other legal services as may be required and are deemed to be in the interests of the Oversight Committee in accordance with the terms of the Amended Plan and Confirmation Order. Paul J. Battista and Mariaelena Guitian, Esq., the attorneys who will be principally working on the cases, will bill $595 and $450 per hour, respectively. The rates of other professionals are: Attorneys $200 to $595 Associate Attorneys $200 to $350 Legal Assistants $150 to $195 The Oversight Committee assures the Court that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About TLO LLC nka TLFO LLC TLO LLC, a provider of risk-mitigation services, filed a petition for Chapter 11 reorganization (Bankr. S.D. Fla. Case No. 13-bk20853) on May 9, 2013, in West Palm Beach, Florida, near the company's headquarters in Boca Raton. The petition was signed by E. Desiree Asher as CEO. Judge Paul G. Hyman, Jr., presides over the case. Robert C. Furr, Esq., and Alvin S. Goldstein, Esq., at Furr & Cohen, serve as the Debtor's counsel. Bayshore Partners, LLC is the Debtor's investment banker. Thomas Santoro and GlassRatner Advisory & Capital Group, LLC are the Debtor's financial advisors. Paul J. Battista, Esq., and Mariaelena Gayo-Guitian, Esq., at Genovese, Joblove & Battista, P.A., represent the Official Committee of Unsecured Creditors as counsel. The Debtor disclosed assets of $46.6 million and liabilities of $109.9 million, including $93.4 million in secured claims. The principal lender is Technology Investors Inc., owed $89 million. TII is owned by the estate of Hank Asher, the company's primary owner who died this year. There is $4.6 million secured by computer equipment. TRIPLANET PARTNERS: Robinson Brog Approved as General Counsel ------------------------------------------------------------- The Bankruptcy Court authorized Triplanet Partners LLC to employ Robinson Brog Leinwand Greene Genovese & Gluck P.C. as general counsel. Robinson Brog will represent the Debtor in the Chapter 11 case, and assist it in carrying out its duties as debtor-in-possession. To the best of the Debtor's knowledge, Robinson Brog is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A. Mitchell Green, shareholder of Robinson Brog, in a supplemental declaration in support of the application to employ counsel, stated that with regard to Robinson Brog's prior representation of Jared Stamel, the firm has not represented Mr. Stamel since his bankruptcy case was dismissed in 2001. On June 10, creditor Benjamin Roberts objected to the employment of Robinson Brog stating that the connection between Robinson Brog and Mr. Stamell creates an additional basis to conclude that Robinson Brog, which represented Attorney Stamell for six years in his own bankruptcy, will not be influenced by Attorney Stamell and his clients, the Bennaceur brothers. Mr. Roberts is by a substantial margin, the largest non-insider creditor of the Debtor based on claims in an action pending against the Debtor and non-debtor co-defendants, Sophien, Imed and Moez Bennaceur. The Debtor is represented by: A. Mitchell Greene, Esq. ROBINSON BROG LEINWAND GREEN GENOVESE & GLUCK P.C. 875 Third Avenue New York, NY 10022 Tel: (212) 603 6300 Mr. Roberts is represented by: Brendan J. O'Rouke, Esq. Lorey Rives Leddy, Esq. O'ROURKE & ASSOCIATES, LLC 27 Pine Street New Canaan, CT 06840 Tel: (203) 966-6664 Fax: (203) 966-5710 E-mails: 1rendan@orourkeandassoc.com lorey@orourkeandassoc.com About Triplanet Partners LLC Triplanet Partners LLC filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-22643) on May 8, 2014. Sophien Bennaceur signed the petition as manager. The Debtor disclosed $19,946,560 in assets and $33,663,525 in liabilities. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtor's counsel. Judge Robert D. Drain oversees the case. TRIPLANET PARTNERS: Joshua Rizack Approved as CRO ------------------------------------------------- The Hon. Robert D. Drain approved the appointment of Joshua Rizack, senior managing director of the Rising Group Consulting, Inc., as chief restructuring officer for Triplanet Partners, LLC. Mr. Rizack -- jrizack@therisinggroup.com -- will oversee and manage the Debtor and its estate while assisting in the analysis of the Debtor's finances and advising in regard to the business plan. Mr. Rizack will be paid fixed monthly compensation of $6,000 for up to 15 hours of work per month and thereafter for any additional work at the rate of $450 per hour. The Debtor, in response to the objection of creditor Benjamin Roberts to application to appoint Mr. Rizack as CRO, stated that the revised CRO order resolves the issues raised by the objection and that any other components of the objection must be overruled and the appointment of the CRO must be approved. Mr. Roberts, in his objection, stated that apart form the lack of any need for a CRO, the terms of Mr. Rizacks retention do not comport with the Jay Alix Protocol and are otherwise unreasonable. About Triplanet Partners LLC Triplanet Partners LLC filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-22643) on May 8, 2014. Sophien Bennaceur signed the petition as manager. The Debtor disclosed $19,946,560 in assets and $33,663,525 in liabilities. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtor's counsel. Judge Robert D. Drain oversees the case. U.S. COAL: Consents to Being in Chapter 11 ------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. Coal Corp., a coal producer in the Central Appalachian region of eastern Kentucky, consented to being in Chapter 11 effective June 27. As previously reported by The Troubled Company Reporter, Kolmar Americas, Inc., filed an involuntary Chapter 11 bankruptcy petition for U.S. Coal Corporation. Bridgeport, Connecticut-based Kolmar says it is owed by Lexington-based U.S. Coal roughly $1.36 million on account of a business debt. U.S. Coal stated in court papers that upon receipt of the involuntary petition, it, in consultation with its legal and financial advisors, determined that it had no adequate grounds to dispute the allegations of the petitioning creditor and concluded that the consensual resolution of the involuntary petition was necessary to avoid the unnecessary expense and delay of litigation, and to enable U.S. Coal to concentrate its attention going forward on maximizing the value of its assets for the benefit of creditors and parties-in-interest by consenting to the relief sought by the petitioning creditor. To ensure its continued operations and to effectuate a restructuring of its balance sheet, U.S. Coal seeks authority from the U.S. Bankruptcy Court for the Eastern District of Kentucky to use cash collateral securing its prepetition indebtedness, which, as of May 1, 2014, total approximately $75 million. U.S. Coal also filed a motion asking the Bankruptcy Court to issue an order authorizing to join administration of the Chapter 11 cases of its subsidiaries -- Licking River Mining, LLC, Licking River Resources, Inc., S.M. & J., Inc., Fox Knob Coal Co., Inc., and J.A.D. Coal Company, Inc., -- under the lead case of Licking River Mining, LLC, Case No. 14-10201, to reduce the amount of duplicative pleadings and notice that will be filed and served. U.S. Coal's largest unsecured creditors are the following: Entity Nature of Claim Claim Amount ------ --------------- ------------ Alpha Lit Professional Fees $21,035 8201 Greensboro Drive Suite 717 Mc Lean, VA 22102-3810 CAMHZN Litigation $675,000 c/o Centrecourt Asset Management 11 East 44th Street Suite 1600 New York, NY 10017 CAMOFI Litigation $1,620,000 c/o Richard Smithline 11 East 44th Street Suite 1600 New York, NY 10017 Continental Stock Transfer Stock Transfer $1,832 and Trust Agent 17 Battery Place New York, NY 10004 Coulter & Justus, PC Professional Fees $75,429 9717 Cogdill Road Suite 201 Knoxville, TN 37932 CT Corporation System Trade $709 JAF Station P.O. Box 4349 Carol Stream, IL 60197-4349 Ernst & Young Professional Fees $40,000 P.O. Box 640382 Pittsburgh, PA 15264 Futuretec Litigation $135,000 111 Great Neck Road Suite 301 Great Neck, NY 11021 Kentucky Coal Association Membership $18,566 2800 Palumbo Drive #200 Lexington, KY 40509 Kolmar Americas Inc. Trade Unknown 10 Middle Streeet #1701 Bridgeport, CT 06604-4259 Lawrence Kaplan Litigation $135,000 2000 South Ocean Blvd. Boca Raton, FL 33432 LRR Unsecured Note Unsecured Note $6,093,246 c/o Licking River Resources, Inc. P.O. Box 637 West Liberty, KY 41472 The Nelson Law Firm, LLC Professional Fees $449,564 White Plains Plaza 1 North Broadway White Plains, NY 10601 Wilmington Trust Company Escrow Agent $7,000 P.O. Box 8955 Wilmington, DE 19899-8955 U.S. Coal is represented by: Laura Day DelCotto, Esq. Amelia Martin Adams, Esq. DELCOTTO LAW GROUP PLLC 200 North Upper Street Lexington, KY 40507 Tel: (859) 231-5800 Fax: (859) 281-1179 Email: ldelcotto@dlgfirm.com aadams@dlgfirm.com -- and -- Dennis J. Drebsky, Esq. Christopher M. Desiderio, Esq. NIXON PEABODY LLP 437 Madison Avenue New York, NY 10022-7039 Tel: (212) 940-3000 Fax: (212) 940-3111 Email: ddrebsky@nixonpeabody.com cdesiderio@nixonpeabody.co Kolmar is represented by Daniel I. Waxman, Esq., at Wyatt, Tarrant & Combs, LLP, in Lexington, Kentucky. Chief Judge Tracey N. Wise presides over the case. USS PARENT: Moody's Assigns 'B2' CFR & 'B1' Senior Secured Rating ----------------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating ("CFR") to USS Parent Holding Corp. (indirect parent of United Site Services, Inc., "USS"), as well as a B2-PD Probability of Default Rating ("PDR") and a B1 rating to the proposed senior secured revolver due 2019 and senior secured term loans due 2021. The ratings outlook is stable. USS will be acquired by Calera Capital. The proposed term loan, along with equity from Calera and the proceeds of subordinated notes (not rated) will be used to purchase the company and pay related fees and expenses. Issuer: USS Parent Holding Corp. Assignments: Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Senior Secured Revolving Credit Facility due 2019, Assigned B1, LGD3 Senior Secured Term Loan due 2021, Assigned B1, LGD3 Senior Secured Delayed Draw Term Loan due 2021, Assigned B1, LGD3 Rating Outlook is Stable Ratings Rationale The B2 CFR reflects Moody's expectation that USS's debt to EBITDA will remain about 5.5 times (after Moody's standard adjustments) as USS continues to use free cash flow, and perhaps incremental debt, to make acquisitions. USS has a small operating scale with revenues expected to be less than $250 million, about half of which comes from the cyclical construction sector. Economic sensitivity in the company's end markets create potential revenue and cash flow volatility for USS that contributed to a debt restructuring during the last downturn. The ratings more favorably reflect USS's improved operating efficiency, geographic scope and product offerings (such as fencing) and its position as a leading provider of portable sanitation units, a highly fragmented market with a diverse, national customer base. Additional support comes from Moody's expectations for operating profit margins in the low 20 percents, EBITDA less capital expenditures to interest expense above 1.5 times and about $15 million of free cash flow. Moody's considers USS's liquidity to be adequate. The stable rating outlook reflects Moody's expectations for organic revenue growth of 6% to 8% and slowly improving operating profitability rates. The stable outlook anticipates USS will be acquisitive and will not reduce debt beyond required amortization payments. Moody's could upgrade the ratings if USS grows revenue and profitability faster than expected, and maintains a good liquidity position. In addition to these factors, Moody's would expect USS to maintain debt to EBITDA below 4.5 times and free cash flow to total debt over 8%. Moody's could downgrade the ratings if slower revenue growth or profitability declines lead Moody's to anticipate low or no free cash flow, or if USS's liquidity weakens. If debt to EBITDA is sustained above 6.0 times or EBITDA less capital expenditures to interest expense is less than 1.25 times, the ratings could be lowered. The principal methodology used in this rating was the 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 US, Canada, and EMEA, published in June 2009. USS is a provider of portable sanitation units, temporary fencing, storage containers and temporary electric equipment serving the construction and other industries, as well as governmental agencies. The company estimates revenue in its fiscal year ended December 2013 was approximately $225 million pro forma for recent acquisitions. VAIL LAKE: Plan Exclusivity Period Extended to Aug. 1 ----------------------------------------------------- The U.S. Bankruptcy Court approved the motion of Vail Lake Rancho California, LLC et al. to extend, through and including August 1, 2014, the Exclusive Period within which the Debtors have the exclusive right to file plans; and through and including October 1, 2014, the Exclusive Period within which the Debtors have the exclusive right to solicit acceptances of such plans. The Court's order is without prejudice to the Debtors' right to seek further extension of the exclusivity periods in accordance with the requirements of Bankruptcy Code section 1121. The hearing was held on June 19, 2014. The Debtors have previously sought two extensions of their Exclusivity Periods, which extensions were necessary to stabilize the Debtors' cases, conduct the diligence necessary to formulate a plan for the Debtors to operate during the bankruptcy cases and negotiate with the most important constituencies in the bankruptcy cases, and to commence executing on that plan. One of the main pillars of the Debtors' plan is reaching a global settlement with the Debtors' largest secured creditors. Settlement discussions with the secured creditors have been ongoing over the past several months, and parties have now come to an agreement in principle on a comprehensive settlement that the Debtors are hopeful will result in substantial distributions to all creditors. Due to the complicated issues among the Debtors and the various secured creditors, however, it is taking a significant amount of time to document the settlement in full. The Debtors therefore require more time to finalize the settlement, which itself is a predicate to the Debtors being able to propose a chapter 11 plan (or plans). During this same time period the Debtors have been negotiating with their secured creditors, the Debtors have also been devoting substantial attention to making much needed repairs and improvements to their facilities. These repairs and improvements have included renovations of 1) the public and campsite restrooms, 2) the campsite community room, and 3) some of the stables. The Debtors expect these renovations will improve guest experiences, which in turn will improve revenue. The progress made thus far in the cases, according to the Debtors, has required a significant amount of energy and efforts on the part of the Debtors and their counsel. Going forward, the process will require the Debtors to continue to dedicate the same level of efforts and attention if not more. The extension requested in this Motion will allow the Debtors to do just that, while preserving their Exclusivity Periods and avoiding the distraction relating to a chapter 11 plan filing by a party other than the Debtors. Under these circumstances, a further short extension of the Exclusivity Periods is more than appropriate. 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. VIVARO CORP: Aug. 25 Transition Period Claims Bar Date Proposed --------------------------------------------------------------- Vivaro Corporation and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to set Aug. 25, 2014, at 5:00 p.m., as the business transition period claims bar date for all administrative expense claims incurred from Feb. 8, 2014, to June 27, 2014. The Debtors tell the Court that the deadline would apply to all entities holding unpaid business transition period claims that arose during the business transition period. By establishing the deadline, they will be able to determine the finality the universe of claims asserted their estates, according to the Debtors. About Vivaro Corp. Vivaro Corp., which specializes in the sale of international calling cards in the U.S., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-13810) on Sept. 5, 2012, together with six other related companies, including Kare Distribution Inc. The Debtor is represented by Frederick E. Schmidt, Esq., at Hanh V. Huynh, Esq., at Herrick, Feinstein LLP. Garden City Group Inc. is the claims and notice agent. A five-member official committee of unsecured creditors has been appointed in the case. VIVARO CORP: To Execute Partial Lien Release Against Purchaser -------------------------------------------------------------- Bankruptcy Judge Martin Glenn authorized Vivaro Corporation, et al., to execute a partial lien release against Angel Americas, LLC, the purchaser of the Debtor's assets, except for a lien on $300,000 in cash to be held in the Debtor's bank account. The purchaser granted the Debtors a security interest in substantially all of its assets as security for the purchaser's obligations to the Debtors under a promissory note, a transition services agreement (the TSA), and related documents entered into in connection with the asset sale. The note is now fully paid, and the purchaser has entered into an agreement with the Federal Communications Commission, which will likely result in the purchaser obtaining its own permanent 214 license to operate the Debtor's business. According to the order, the Debtors' partial release of liens is contingent upon (i) the Debtors' receipt of $300,000 from the purchaser which sum represents the full amount of the cash collateral; (ii) purchaser's payment of all rent and rent-related arrears accrued during the interim period (comprised of $72,276 plus any additional obligations) to JT MH 1250 Owner LP; and (iii) purchaser's filing of all outstanding state sales tax returns. The Court also ordered that, as set forth in the settlement agreement, the FCC releases and forever discharges the Debtors and their chapter 11 bankruptcy estates of and from any and all claims the FCC might otherwise assert regarding the payment of the current fees during the interim period, including but not limited to for payment of the outstanding balance. For the avoidance of doubt, the FCC will not file against the Debtor released parties any application, motion or any other document seeking payment of or allowance of any administrative expense claim which arose or may arise during the interim period including but not limited to the outstanding balance. The Debtors are represented by: John R. Goldman, Esq. Frederick E. Schmidt, Jr., Esq. Justin B. Singer, Esq. HERRICK, FEINSTEIN LLP 2 Park Avenue New York, NY 10016 Tel: (212) 592-1400 Fax: (212) 592-1500 E-mails: igoldman@herrick.com eschmidt@herrick.com isinger@herrick.com About Vivaro Corp. Vivaro Corp., which specializes in the sale of international calling cards in the U.S., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-13810) on Sept. 5, 2012, together with six other related companies, including Kare Distribution Inc., STi Prepaid, LLC, STI Telecom, Inc., TNW Corporation, STi1, LLC and STi2, LLC. Bankruptcy Judge Martin Glenn oversees the case. The Debtors are represented by John R. Goldman, Esq., Frederick E. Schmidt, Jr., Esq., and Justin B. Singer, Esq., at Herrick, Feinstein LLP. Garden City Group Inc. is the claims and notice agent. SSG Capital Advisors, LLC, serves as investment banker. UHY Advisors NY, Inc. and UHY LLP provide accounting and tax services. Vivaro tapped Marotta Gund Budd & Dzera, LLC, to provide crisis management services. The firm's Philip J. Gund serves as chief restructuring officer; B. Lee Fletcher serves as acting chief financial officer; and Lyle Potash serves as assistant restructuring officer. The Law Offices of Gabriel Del Virginia serves as special counsel to investigate and prosecute the avoidance actions. Womble Carlyle Sandridge & Rice, LLP, serves as special counsel for matters related compliance with the Federal Communications Commission rules and regulations in connection with the sale of the Debtors' assets. The U.S. Trustee for Region 2 appointed five members to the official committee of unsecured creditors. Arent Fox LLP, led by George P. Angelich, Esq., serves as counsel; and BDO Consulting is the financial advisor to the committee. In its schedules, Vivaro disclosed $47,530,929 in total assets and $51,643,053 in total liabilities. Angel Telecom Corporation disclosed that on Feb. 8, 2013, Next Angel LLC, a joint venture between Angel Telecom (Angel), Next Communications, Inc. and Marcatel Telecommunications, LLC, acquired substantially all of the assets of Vivaro and certain of its affiliates out of Vivaro's bankruptcy. Angel owns a 42.5% stake in Next Angel. Dow Jones' DBR Small Cap said the assets were sold for $4.5 million in cash plus $25 million in assumed liabilities. WHEATLAND MARKETPLACE: U.S. Bank Balks at Cash Access Beyond July ----------------------------------------------------------------- U.S. Bank National Association, as Trustee, successor to Bank of America, National Association, objected to Wheatland Marketplace LLC's motion for interim approval to use of cash collateral. In addition, U.S. Bank requests that any additional interim cash collateral order entered by the U.S. Bankruptcy Court for the Northern District of Illinois extend the Debtor's authorization to use cash collateral only through July 31, 2014, on the terms previously approved in the prior cash collateral orders, and further provide that such authorization is expressly conditioned upon the Debtor either: a) closing on the sale of the Property to ArciTerra Properties, LLC previously approved by the Court by July 24, 2014, or b) initiating an open-sale process, in consultation with its broker, by July 31, 2014, pursuant to which the Noteholder will have the right to credit-bid its claim in any competitive auction setting, and granting such further relief as may be just and necessary under the circumstances. As of the Petition Date, the Debtor was unconditionally indebted to the Noteholder in the amount of at least $7,013,354 plus any and all other fees, obligations, and other liabilities owing under a certain loan documents. The obligations are secured by, among other things, all of the Debtor's interests in the property, according to court documents. On April 22, 2014, the Court approved the Debtor's sale of a property to ArciTerra pursuant to the terms and conditions of the purchase agreement, which sale included a diligence period of 30 days, and an anticipated closing date by the end of June. Since that time, the Debtor has granted five separate extensions of ArciTerra's diligence period, pushing the anticipated closing to the end of July at the earliest. In addition, the Debtor has informed the Noteholder that the Debtor similarly may purport to elect to grant further extensions, as ArciTerra and the Debtor explore the possibility of expanding the sale to an adjacent property that is not part of Debtor's estate, and that, even with such further extensions, the Debtor does not know whether any sale to ArciTerra will actually close. According to the Noteholder, despite being nearly 7 months into a case in which its over $7.2 million, fully-secured claim is the only significant claim against the Debtor's estate, it has not filed a bevy of motions seeking to have the stay lifted or the case dismissed. Instead, it has attempted to work collaboratively with the Debtor on a consensual sale process that would see its claim paid in full and funds left over for the Debtor and any other creditors. This has included its consent to the continued use of its cash collateral, the Debtor's engaging of a broker who was to run a sale process of the property, and a proposed and approved private sale of the Property to ArciTerra. Thomas S. Kiriakos, Esq., at Mayer Brown LLP, noted the time has now come, however, for this case to be resolved -- either the sale to ArciTerra should be finalized, and this case closed, or the Debtor should be compelled to move forward with an open-sale process that will lead to payment of the Noteholder's claim in full. To that end, the Noteholder respectfully requests that any further extensions of the Debtor's authorization to use Cash Collateral be limited to one month and be expressly conditioned on either a closing of the sale of the Property to ArciTerra by July 24, 2014 or the Debtor's broker having initiated an open-sale process by July 31, 2014, Mr. Kiriakos said. U.S. Bank National Association is represented by: Thomas S. Kiriakos, Esq. Aaron Gavant, Esq. MAYER BROWN LLP 71 South Wacker Drive Chicago, IL 60606 Tel: (312) 701-7275 Fax: (312) 706-8232 E-mail: tkiriakos@mayerbrown.com agavant@mayerbrown.com About Wheatland Marketplace, LLC Wheatland Marketplace, LLC, owner of a commercial retail center in Naperville, Illinois, filed a Chapter 11 bankruptcy petition (Bankr. N.D. Ill. Case No. 13-46492) in Chicago on Dec. 3, 2013. The Debtor has tapped Thomas W. Toolis, Esq., at Jahnke, Sullivan & Toolis, LLC, in Frankfurt, Illinois, as counsel. Coleen J. Lehman Trust and Lucy Koroluk each holds a 50% membership interest in the Debtor. The Debtor reported $10,999,006 in total assets, and $7,052,778 in total liabilities. No committee of unsecured creditors has been appointed to serve in the case. WHITING PETROLEUM: Moody's Puts 'Ba2' CFR On Review for Upgrade --------------------------------------------------------------- Moody's Investors Service placed under review for upgrade Whiting Petroleum Corporation's Ba2 Corporate Family Rating (CFR), and placed on review, direction uncertain, Whiting's Ba2 rated senior unsecured notes and Ba3 rated senior subordinated notes. At the same time, Moody's placed under review for upgrade Kodiak Oil & Gas Corp.'s B2 CFR and B3 rated senior unsecured notes. These rating actions were prompted by Whiting's announcement that it will acquire Kodiak in an all-stock transaction valued at $6 billion, inclusive of Kodiak's net debt of $2.2 billion. Whiting's senior management team will run the combined company, and two of Kodiak's directors, its current Chairman and Chief Executive Officer and its Executive Vice President of Business Development, will join Whiting's board of directors. Each company's board of directors has approved the transaction. Closing is expected in the fourth quarter of 2014, subject to both company's shareholders approvals and regulatory approvals. "With the acquisition of Kodiak, Whiting will gain basin intensification in its already established position in the Williston Basin, with a larger production base and deeper drilling inventory, which should enable enhanced drilling and operating efficiencies," commented Gretchen French, Moody's Vice President. "However, even with the benefit of the all stock transaction, Whiting will need to demonstrate strong growth in production and cash flow in order to maintain credit ratios indicative of a higher rating given Kodiak's heavy debt levels." Issuer: Whiting Petroleum Corporation Review for possible upgrade: Corporate Family Rating, rated Ba2 Probability of Default Rating, rated Ba2-PD Review direction uncertain: Senior Unsecured Bonds, rated Ba2 Senior Subordinated Bond, rated Ba3 Affirmations: Speculative Grade Liquidity Rating of SGL-2 Issuer: Kodiak Oil & Gas Corp. Review for possible upgrade: Corporate Family Rating, rated B2 Probability of Default Rating, rated B2-PD Senior Unsecured Bonds, rated B3 Affirmations: Speculative Grade Liquidity Rating of SGL-3 Ratings Rationale The review of Whiting's CFR reflects the increased size and growth opportunities achieved through the Kodiak transaction. The review will focus on Whiting's ability to achieve higher growth rates in tandem with drilling and operational synergies on the acquired Kodiak acreage, and in turn, its ability to achieve improved financial metrics in terms of debt/production and retained cash flow/debt. The Kodiak review reflects Kodiak's improved credit profile as part of Whiting, a larger company with greater financial flexibility. Whiting is not required to guarantee the Kodiak notes, and the company believes that it can close the acquisition and operate its business without guaranteeing the notes. Kodiak's unsecured note ratings could benefit from a one to two notch upgrade from their existing B3 ratings based on Moody's analysis of the strategic importance of Kodiak to Whiting and the notes structural position in the combined company's pro forma capital structure. The Kodiak review will also consider the level of financial and operational disclosure available with respect to Kodiak following the close of the acquisition. The rating review, direction uncertain, of Whiting's senior unsecured notes and subordinated notes reflects uncertainty to Whiting's CFR and ultimate capital structure when the Kodiak acquisition closes. Should the review of Whiting's CFR result in a one-notch upgrade to Ba1, Whiting's senior unsecured notes would likely still be rated Ba2 because of the contemplated increase in the size of its priority-claim secured revolver relative to the unsecured notes. In addition, Whiting's subordinated notes rating would likely remain unchanged at Ba3 under such a scenario. However, if Whiting's CFR is confirmed at Ba2, the unsecured notes and subordinated notes would each likely be downgraded one-notch to Ba3 and B1, respectively. Upon the closing of the acquisition, Whiting's CFR could be upgraded to the extent there is a clear trajectory to debt/production being restored below $33,000/boe. Given the review for upgrade, a ratings downgrade would be considered unlikely, however, a downgrade could be considered if Whiting experienced weaker than expected production levels on its Williston basin drilling program or materially increased leverage (debt/production maintained in excess of $40,000/boe). The acquisition of Kodiak will strengthen Whiting's position in the high margin Williston Basin, which on a pro forma basis will account for 82% of its production profile. Whiting's pro forma production will increase to about 134,000 barrels of oil equivalent (boe) per day from roughly 100,000 boe/day in the first quarter of 2014. In addition, Kodiak's complementary acreage position will expand Whiting's drilling inventory in the Williston Basin to 3,460 locations from 1,339. Whiting expects to accelerate drilling on Kodiak's acreage position and believes as a larger, combined entity with meaningful midstream assets, it can lower the production costs and drilling costs on the Kodiak acreage. Despite being an all-stock transaction, Whiting's leverage metrics will increase as a result of the transaction. Kodiak has elevated financial leverage that had constrained its CFR at B2. On a pro forma combined basis, debt/production will increase to $37,000/boe of average daily production from $27,000/boe, retained cash flow/debt will decline to 48% from 66%, and debt/proved developed reserves will increase to $15/boe from $11/boe, as of financial data ending March 31, 2014. In addition, the company's reserve base will become more weighted to proven undeveloped (PUD) reserves (increasing to 46% PUDs from 42%), which will require significant capital in order to develop. Nevertheless, even assuming the outspend of cash flow is debt financed, Moody's expect Whiting to continue to grow both its stand alone and Kodiak's production and cash flow, which should result these leverage metrics improving in 2015. Whiting will assume Kodiak's existing $1.6 billion unsecured notes, but is not required to guarantee the notes. To the extent Kodiak's notes are put to Whiting under the notes' change-of- control provisions, Whiting will bridge those purchases, as well as the repayment of Kodiak's $700 million in revolver drawings, under a new committed senior secured credit facility. Whiting's new credit facility consists of a $2.5 billion five-year revolver and a $1 billion delayed draw facility maturing on December 31, 2015. The initial borrowing base of the credit facility is $4.5 billion. Whiting would then look to term out any drawings under the delayed draw facility with new senior unsecured debt issued by Whiting. The principal methodology used in this rating was the Global Independent Exploration and Production Industry published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Whiting Petroleum Corporation is an independent exploration and production company headquartered in Denver, Colorado. Kodiak Oil & Gas Corp. is an independent exploration and production company headquartered in Denver, Colorado. WINDSOR PETROLEUM: Files Ch. 11 to Implement Debt-To-Equity Swap ---------------------------------------------------------------- Windsor Petroleum Transport Corporation and several of its subsidiaries and related entities on July 14, 2014, filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court in Wilmington, Delaware (Lead Case No. 14-11708). Windsor Petroleum said in a statement that it has entered into a restructuring support agreement with bondholders who hold more than 70% of the Company's 7.84% secured notes in a principal amount of $188,590,000 as of this date. The supporting holders of the Notes have agreed to support a plan of reorganization that would convert claims on account of the Notes for 100% of the equity in the reorganized company. Frontline Ltd ("FRO") will enter into a revised management agreement with the reorganized company and will continue to provide commercial management for its vessels. The Company believes that the reorganized balance sheet will provide for a strong operating platform and provide the best possible position for the reorganized company going forward. The Company said that all operating entities are expected to continue normal operations during the restructuring. The Company projects that a consensual cash collateral order will provide sufficient cash to fund its operations during its financial restructuring. The Company said it also expects to file a variety of customary motions to continue to support its customers and vendors during the financial restructuring process. The Company expects to file motions seeking permission to continue to pay trade creditors and foreign vendor balances incurred before and after the filing in full and in the normal course. The Company expects to receive court approval for these requests. During the restructuring process, the Company anticipates operating as usual, meeting all its ongoing trade obligations, and expects to implement the restructuring and emerge from the court- supervised process expeditiously. The Company has tapped Young Conaway Stargatt & Taylor, LLP as principal bankruptcy attorneys, and AMA Capital as crisis management services provider. Hamilton, Bermuda-based Windsor Petroleum estimated at least $100 million in liabilities and less than $50,000 in assets in its bare-bones Chapter 11 petition. XUMANII INTERNATIONAL: Has $1.06-Mil. Net Loss in April 30 Quarter ------------------------------------------------------------------ Xumanii International Holdings Corp. filed its quarterly report on Form 10-Q disclosing a net loss of $1.06 million on $nil of revenues for the three months ended April 30, 2014, compared with a net loss of $307,205 on $nil of revenues for the same period in 2013. The Company's balance sheet at April 30, 2014, showed $1.11 million in total assets, $2.61 million in total liabilities, and a stockholders' deficit of $1.5 million. As of April 30, 2014, the Company has an accumulated deficit of $3.6 million, limited liquidity and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs for the next twelve month period. These factors raise substantial doubt regarding the Company's ability to continue as a going concern, according to the regulatory filing. A copy of the Form 10-Q is available at: http://is.gd/3z8S3q Xumanii International Holdings Corp. is a development stage company, which develops RFID, other tracking technologies and other technologies through its new acquired company Trakkers LLC. Its devices are used at trade shows as lead retrieval devices. The company was formerly known as Xumanii, Inc. and changed its name to Xumanii International Holdings Corp. in July 2013. Xumanii International Holdings was founded on May 6, 2010 and is headquartered in Las Vegas, NV. YARWAY CORP: Seeks Extension of Time to Remove Lawsuits ------------------------------------------------------- Yarway Corp. has filed a motion seeking a four-month extension to file notices of removal of lawsuits involving the company. In its motion, Yarway asked the U.S. Bankruptcy Court in Delaware to extend the deadline to December 15 from August 16, saying it would give the company enough time to determine whether to remove a lawsuit or not. Yarway is a defendant in over 5,000 personal injury cases filed by victims who claimed they have been exposed to asbestos contained in products manufactured by the company. Most of the cases are pending in U.S. state courts and are in various stages of the litigation process, according to the court filing. The bankruptcy court will hold a hearing on July 30 to consider the motion. Objections are due by July 23. About Yarway Corporation Yarway Corporation sought Chapter 11 protection (Bankr. D. Del. Case No. 13-11025) on April 22, 2013, to deal with claims arising from asbestos containing products it allegedly sold as early as the 1920s. Yarway was founded in 1908 by Robert Yarnall and Bernard Waring as the Simplex Engineering Company and originally manufactured pipe clamps, steam traps, valves and controls. Based in Pennsylvania, Yarway was a privately-owned company until 1986 when KeyStone International, Inc. bought equity in the company. Yarway became a unit of Tyco International Ltd. when Tyco purchased KeyStone in 1997. Yarway's asbestos-related liabilities derive from Yarway's (i) purported use of asbestos-containing gaskets and packing, manufactured by others, in its production of steam valves and traps from the 1920s to 1970s, and (ii) alleged manufacture of expansion joint packing that was allegedly made up of a compound of Teflon and asbestos from the 1940s to the 1970s. Over the past five years, about 10,021 new asbestos claims have been asserted against Yarway, including 1,014 in Yarway's 2013 fiscal year ending March 31, 2013. The Debtor estimated assets and debts in excess of $100 million as of the Chapter 11 filing. Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A. and Sidley Austin LLP serve as the Debtor's counsel in the Chapter 11 case. Logan and Co. is the claims and notice agent. On May 6, 2013, the U.S. Trustee for Region 3, appointed an official committee of asbestos personal injury claimants. The Committee tapped Elihu Inselbuch, Esq. at Caplin & Drysdale, Chartered, as lead bankruptcy counsel. YELLOWSTONE MOUNTAIN: Blixseth Hit With $220MM Judgment by Trustee ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Timothy Blixseth, the former owner of the bankrupt Yellowstone Mountain Club LLC, can appeal now because a U.S. district judge in Los Angeles entered a $219.9 million judgment against him. According to the report, the judgment, which was Blixseth's fifth and largest defeat this year, resulted from a June 18 decision by U.S. District Judge Gary Allen Feess, partly based on a ruling in April when a Montana district judge upheld a $41 million judgment against Blixseth, saying the record "amply demonstrated" Blixseth's "fraudulent manipulations of corporations he controlled to his personal benefit." The suit is Kirschner v. Blixseth, 11-cv-08283, U.S. District Court, Central District of California (Los Angeles). About Yellowstone Mountain Located near Big Sky, Montana, Yellowstone Mountain Club LLC -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Club and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Montana, Case No. 08-61570) on Nov. 10, 2008. The Company's owner affiliate, Edra D. Blixseth, filed a separate Chapter 11 petition on March 27, 2009 (Case No. 09-60452). Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC represented Yellowstone. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer; and James H. Cossitt, Esq., as counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners LLC acquired equity ownership in the reorganized Club for $115 million. Marc S. Kirschner, Esq., was appointed the Trustee of the Yellowstone Club Liquidating Trust created under the Plan. YUCCA GROUP: Submits Post-Confirmation Status Report ---------------------------------------------------- The Yucca Group, LLC, submitted to the Bankruptcy Court its First Post-Confirmation Status Report dated May 2, 2014. Yucca Group on Jan. 16, 2014, won confirmation of its First Amended Plan of Reorganization dated Oct. 13, 2013. The Plan became effective on Feb. 17, 2014. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/YUCCAGROUP_401_ds.pdf According to the Debtor, since the Effective Date, it has continued to work to fully consummate the Plan in accordance with the confirmation order. The Debtor related that its complaint against PEI Asset Pool III, LLC, is set be heard on July 24, 2014. The Reorganized Debtor also said that it will continue to work to resolve outstanding matters to ensure the timely closing of the case. Post-confirmation status conference must be continued to late August 2014. On Dec. 5, 2013, the Court denied the Debtor's motion to strike PEI Asset Pool III LLC's objection to the approval of the Disclosure Statement and Plan. On Nov. 15, 2013, the Debtor requested to strike PEI's objection because of PEI's lack of standing and is not a party-in-interest. PEI, in its objection, stated that the Disclosure Statement does not provide adequate information regarding Yucca Group's cause of action/claim for relief against PEI. PEI Asset is represented by: J. Scott Bovitz, Esq. BOVITZ & SPITZER 1100 Wilshire Blvd., Suite 2403 Los Angeles, CA 90017-1961 Tel: (213) 346-8300 Fax: (213) 928-4174 E-mail: bovitz@bovitz-spitzer.com Distribution Outside Plan The Bankruptcy Court, in an order dated Jan. 23, instructed the Debtor that payments under the Plan must be completed before an order discharging the cases is entered. Peter C. Anderson, U.S. Trustee, also objected to the relief requested in the Debtor's motion for order authorizing the Debtor to make interim distributions to creditors outside of a plan pending dismissal of the case. On Sept. 27, 2013, the Debtor asked the Court for authorization to make interim distributions to creditors outside the pending dismissal of the case. The Debtor requested that the Court authorize it to take the cash on hand in its Chapter 11 case and to pay out all allowed general unsecured claim on a pro rate basis without incurring the cost, or experiencing delay. Friedman Approved to Handle Claim Against PEI Asset In October 2013, Bankruptcy Judge Geraldine Mund signed off a stipulation modifying the employment of Friedman Law Group, P.C., as counsel for The Yucca Group, LLC. The stipulation entered between the Debtor and the firm provides that: 1. the employment order of Friedman entered on April 6, 2010, will be modified to authorize the firm to pursue the Debtor's claim against PEI Asset Pool III, LLC; 2. the firm will be allowed to recover one-half of the net recovery on the PEI Claim, if any, in consideration for uncompensated services, and for services rendered in pursuing the PEI Claim; and 3. the estate is authorized and directed to pay the firm the non-refundable sum of $10,000, and to reimburse costs actually incurred by the firm in pursuing the PEI Claim up to an aggregate amount of $25,000. The firm can be reached at: J. Bennett Friedman, Esq. Stephen F. Biegenzahn, Esq. Michael Sobkowiak, Esq. FRIEDMAN LAW GROUP, P.C. 1900 Avenue of the Stars, 11th Floor Los Angeles, CA 90067 Tel: (310) 552-8210 Fax: (310) 733-5442 E-mails: jfriedman@jbflawfirm.com sbiegenzahn@jbflawfirm.com msobkowiak@jbflawfirm.com About The Yucca Group, LLC Headquartered in Woodland Hills, California, The Yucca Group, LLC, aka Metro Modern Developers, develops, builds, and sells residential real estate property. It filed for Chapter 11 on February 24, 2010 (Bankr. C.D. Calif. Case No. 10-12079). Friedman Law Group serves as the Debtor's bankruptcy counsel. In its petition, the Debtor estimated its assets and debts at $10 million to $50 million. * Disbarred Atty Accused Of Diverting Firm's Clients, Cash ---------------------------------------------------------- Law360 reported that a disbarred Houston attorney has been sued in Texas state court for allegedly diverting revenue from his former law firm after another lawyer acquired it in a bankruptcy auction. According to the report, the Bennett Law Firm PC hit Robert S. Bennett with a lawsuit on July 3 in Harris County, accusing its founder of transferring clients and cash to various law firms he created and controlled following the bankruptcy sale of TBLF to attorney Bobbie G. Bayless. * Social Security Not Considered in Conversion from '7' to '13' --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a June 27 opinion by U.S. District P. Kevin Castel in Manhattan held that when an individual seeks conversion of a Chapter 7 case to Chapter 13, Social Security income can't be considered in deciding if the bankrupt is eligible for Chapter 13. According to the report, Judge Castel relied on Section 207 of the Social Security Act to say that income from Social Security cannot be considered "in a Chapter 13 eligibility determination." The appeal is Santiago-Monteverde v. Pereira (In re Santiago- Monteverde), 14-01611, U.S. District Court, Southern District of New York (Manhattan). * AIG, Pru's Living Wills Won't Cure All in Case of Collapse ------------------------------------------------------------ Law360 reported that federal officials provided a glimpse into American International Group Inc. and Prudential Financial Inc.'s plans for a tidy wind-down of their business should they face financial catastrophe, but experts say that with so many variables -- and regulators -- involved, these "living wills" may have limited use. According to the report, after being labeled as financial firms whose failure could threaten U.S. financial stability, AIG and Prudential set to work on a plan detailing how the companies should be resolved quickly and in orderly fashion if they run into trouble. * Immigrants Squeezed as Banks Curtail Int'l Money Transfers ------------------------------------------------------------ Michael Corkery, writing for The New York Times' DealBook, reported that as government regulators crack down on the financing of terrorists and drug traffickers, many big banks are abandoning the business of transferring money from the United States to other countries, moves that are expected to reverse years of declines in the cost of immigrants sending money home to their families. According to the report, while Mexico may be most affected -- nearly half of the $51.1 billion in remittances sent from the United States in 2012 ended up in that country -- the banks' broad retreat over the last year is affecting other countries in Latin America and parts of Africa as well. The report said the banks are being held accountable not only for the customers who directly use their money transfer services but also for their role in collecting remittances from money transmitting companies and wiring them abroad. * 4 Attorneys Join Schnader, Bolstering Firm's Real Estate Group ---------------------------------------------------------------- Schnader Harrison Segal & Lewis LLP announced that Scott R. Kipnis, Cynthia G. Couch, Erika L. Jenkins, and Rachel N. Greenberger have joined the firm's New York City office. They come to Schnader from Hofheimer Gartlir and Gross, LLP. "We are delighted to be expanding the national real estate capability of our office and the firm with this group of excellent lawyers," said Schnader's New York Managing Partner Chris Carty. Mr. Kipnis, Ms. Couch, Ms. Jenkins and Ms. Greenberger have nearly 70 years worth of combined experience in commercial real estate matters, with a specialty in shopping center transactions, both in the New York region and nationally. "Scott, Cynthia, Erika and Rachel bring with them a sophisticated real estate practice, representing national and regional chains, in a full range of leasing, property development and land use transactions and disputes throughout the country. They also have an innovative bankruptcy practice, extracting value from the real estate assets of failed retailers," said Schnader Chairman David Smith. Real Estate Practice Group Chair Richard Kessler notes their arrival at Schnader "further strengthens our expanding real estate practice, and we look forward to the opportunity to team up with our new attorneys on a variety of projects." "I am very excited to be joining Schnader," said Mr. Kipnis. "The firm brings a stellar national reputation platform that will allow us to better serve our existing clients, as well as create new opportunities for us to expand Schnader's leasing and real estate practice." "I have had the pleasure of working with Scott for more than a decade on a range of leasing matters," said Todd Littler, vice president leasing, real estate at Dollar Tree Stores. "Over that time, he has shown himself to be knowledgeable, thorough, and responsive. I look forward to continuing our relationship with Scott, now paired with the stellar work we have come to expect from Schnader." Mr. Kipnis' extensive experience includes smooth resolution of complex leasing disputes, building permit acquisition, contractual and licensing disputes, construction issues, employment disputes, insurance litigation, and banking disputes under the Uniform Commercial Code. Richard Senior, Ripco Real Estate broker noted that "one of Scott's best attributes is his business acumen. His no nonsense business approach is unique in deal making today - a talent that is useful whether dealing with the largest REITs or the smallest mom and pop landlords. Simply put, he knows how to get a deal done." "After working with Scott for more than five years in all areas of NYC and Long Island, I can easily say you will not find a more skilled commercial deal making attorney in the region and perhaps the country," said Erin Grace, senior vice president of SRS Real Estate Partners. New Office The firm also is announcing that it will be opening a new office in Melville, N.Y. The Long Island town is home to a number of significant businesses and is the center of a rapidly growing business region, perhaps the most notable growth coming from the recent move of Canon USA's national headquarters to the community. Also headquartered in Melville are healthcare products and services provider Henry Schein Inc., industrial equipment distributor MSC Industrial Direct Co., Inc., digital graphics provider Chyron Corporation, and OSI Pharmaceuticals, Inc. "The Melville office gives us the flexibility to more efficiently serve our clients and potential clients doing business in this location," said Mr. Smith. The office will be located at One Huntington Quadrangle, Melville, NY 11747. New Attorney Spotlights Mr. Kipnis has a substantial track record with mutual client Dollar Tree Stores, as well as other national retail brands. He devotes a significant portion of his time representing national and regional chains in leasing and retail property development, from the inception of lease negotiation to retail store launch and beyond. His clients include Fortune 500 retailers, smaller national and regional retailers, commercial NYC real estate developers, insurance defense third-party administrators, and emerging businesses seeking general business and litigation advice. In addition, he has handled high profile Chapter 11 bankruptcy proceedings, assisted clients in acquiring bankrupt/surplus assets and appeared in bankruptcy proceedings to protect creditor's rights across the country. Ms. Couch has extensive experience in commercial and residential real estate. She regularly provides legal counsel to business owners in transactions ranging from the sale of a small family- owned business to the purchase of a large franchise. She counsels property owners, institutional lenders, investors, and individuals in their commercial and residential real estate transactions throughout Virginia, New York and the United States. Ms. Jenkins' practice includes commercial real estate and leasing, corporate formation, copyright registration and protection, and trademark law (including brand creation and selection, clearing new marks, preparing and filing federal trademark applications, responding to USPTO office actions, and maintenance of registrations). Ms. Greenberger primarily handles real estate matters and real estate-related litigation for a national retailer. Her practice also includes a variety of bankruptcy, litigation and real estate matters. Further reporting on the Schnader attorneys and new office can be found on Law360's article, "Schnader Opens Long Island Outpost with 4-Atty RE Team" and The Philadelphia Business Journal's article, "Schnader Harrison adds Long Island office, real estate group." About Schnader Harrison Segal and Lewis LLP Schnader Harrison Segal & Lewis LLP is a law firm of approximately 170 attorneys with offices in Philadelphia, Pittsburgh, New York City, Melville, N.Y., California, Washington, D.C., New Jersey and Delaware, with an associated office through the law firm of Yang & Co located in Jakarta, Indonesia. Schnader serves local, national and international clients ranging from large corporations to start-ups and entrepreneurs to individual clients in more than 40 areas of the law. In addition to the firm's traditional strengths in complex litigation, commercial transactions and wealth management, the firm has significant experience and depth in business reorganization, international commerce, financial services, intellectual property, labor and employment laws, construction law, real estate development, corporate governance, appellate services, technology-based companies, media and communications, environmental, energy, higher education, nonprofit, government relations and regulatory affairs, aviation issues, securities and shareholder litigation. For more information, please contact Michael Walsh, senior communications manager, at mwalsh@schnader.com or 215-751-2061. * London Partner Elected Global Chair Of Latham & Watkins --------------------------------------------------------- Latham & Watkins announced that Bill Voge has been elected Global Chair and Managing Partner, effective January 1, 2015. Voge will succeed Robert M. Dell, Latham & Watkins' long-time leader, who is retiring after 32 years with the firm, the last two decades as Global Chair and Managing Partner. Voge has an impressive track record in a variety of leadership positions spanning 20-plus years, including eight years on the Executive Committee from 1998-2002 and 2008-2012. He has also served as Global Chair of the Finance Department from 2007-2008 and Global Co-Chair of the Project Finance Practice from 2004-2007 as well as leading a number of firm initiatives focused on global strategy and practice integration for markets outside the United States. Voge's practice focuses primarily on all aspects of project development and project financings, and he has acted for project sponsors, banks, underwriters and other parties on a wide variety of electricity and oil and gas projects in the United States and globally. He is among the world's foremost project finance lawyers with extensive experience leading complex, cross-border deals around the globe. Voge is also a strong advocate for pro bono service, with a particular focus on supporting the fight to end human trafficking. Voge co-leads the firm's relationship with Not For Sale, an international non-profit organization whose mission is to abolish slavery, which involves a team of more than 100 lawyers and professional staff from the across firm's global offices. Voge is based in the firm's London office. He joined Latham in 1983 and was elected to the partnership in 1991. Robert M. Dell, Global Chair and Managing Partner of Latham & Watkins, said: "Bill brings an impressive mix of experience and leadership qualities to the role: astute strategic vision; superb judgment; smart business instincts; and, above all, strong character. He is clear-sighted and a consensus-builder who is highly attuned to our unique culture, client service and the external market forces driving change in the legal profession. Over the years, I have come to know Bill as a colleague and a friend and I am confident that he will lead the firm to continued success with his strength of character and courage of conviction." Chair-Elect Voge said: "It is a unique privilege to lead our great firm. I am profoundly honored to serve my partners in the service of our clients. I look forward to working with the deep bench of talented leaders spread around the globe. In particular, I look forward to the opportunity to work with Vice Chairs Dave Gordon and Ora Fisher and Chief Operating Officer LeeAnn Black, all of whom have terrific judgment, drive and leadership." "Bob is one of the great law firm leaders of our times. His legacy in the firm and more broadly within the profession will be immense. He has been a transformational leader and under his stewardship Latham has had spectacular success and unprecedented growth. Bob has driven our relentless focus on quality and client service and he has exemplified our culture in all that he has done. Bob is that rare leader that combines incredible humility and integrity with a tough, competitive drive. He is known for his fairness, judgment and selfless leadership, and in whose footsteps I hope to follow," added Voge. "Bill was one of the first Latham lawyers on the ground in the firm's New York office when it opened in 1985 as well as one of the first lawyers present when the London office was opened in 1990, and his international practice accounts for a uniquely deep appreciation of our global platform and the global market forces impacting our clients," said David Gordon, Vice Chair of Latham & Watkins. Ora Fisher, Vice Chair of Latham & Watkins, said: "In today's complex, global economy, Bill's strategic leadership and unflinching commitment to excellent client service will ensure we continue to innovate and grow while staying true to our culture." Miles Ruthberg, Chair of the Succession Committee, commented: "The eight-month long, rigorous succession process reaffirmed our shared values: strong collegial culture; inclusive and transparent approach to management; and team approach. I am especially proud of the candidates' professionalism and mutual respect throughout the process. The diversity of highly qualified candidates is a testament to the enormous depth of talent and leadership experience in the firm." LeeAnn Black, Chief Operating Officer, said: "I look forward to working with Bill to continue to strengthen our phenomenal platform that we have built under Bob's visionary stewardship. Bob's strategic leadership has been integral to the firm's success; he has presided over remarkable growth, all while preserving the firm's culture which will be among his most enduring legacies." Voge received his BS from California State University in 1980 and his JD from the University of California, Berkeley, School of Law (Boalt Hall) in 1983 and his MBA from the University of California, Berkeley. About Latham & Watkins Latham & Watkins is a global law firm with approximately 2,100 lawyers in its offices located in Asia, Europe, the Middle East and the United States, including: Abu Dhabi, Barcelona, Beijing, Boston, Brussels, Chicago, Doha, Dubai, Dsseldorf, Frankfurt, Hamburg, Hong Kong, Houston, London, Los Angeles, Madrid, Milan, Moscow, Munich, New Jersey, New York, Orange County, Paris, Riyadh, Rome, San Diego, San Francisco, Shanghai, Silicon Valley, Singapore, Tokyo and Washington, D.C. Visit the Web site http://www.lw.com/ ********* 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 ***