/raid1/www/Hosts/bankrupt/TCR_Public/150723.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, July 23, 2015, Vol. 19, No. 204
Headlines
AMERIRESOURCE TECH: Case Summary & 13 Largest Unsecured Creditors
ARCH COAL: Effects One-For-Ten Reverse Stock Split
ARDENT LEGACY: Moody's Assigns B2 CFR; Outlook Stable
ARDENT LEGACY: S&P Assigns 'B' Corp. Credit Rating, Outlook Stable
ASURION LLC: Moody's Lowers CFR to B2, Outlook Stable
ATLANTIC & PACIFIC: Stop & Shop Expands Presence in New York
ATLANTIC & PACIFIC: Store Closings to Impact KBRA-Rated CMBS
ATLS ACQUISITION: Needs Until Oct. 12 to Remove Actions
AURORA DIAGNOSTICS: Amends 2014 Credit Agreement with Cerberus
BAHA MAR: Bahamas Judge Won't Recognize U.S. Bankruptcy
BAHA MAR: Meeting of Creditors Set for Aug. 3
BOWIE RESOURCE: S&P Affirms B CCR & Raises Rating on Debt to BB-
BRANTLEY LAND & TIMBER: Georgia Land Developer Files for Ch. 11
C. WONDER: To Sell Assets to Xcel Brands
CAESARS ENTERTAINMENT: Bankr. Judge Refuses to Halt Suits v. Parent
CAFE SERENDIPITY: Cancels Distribution Agreement with mCig
CAL DIVE INT'L: Adam Tuma Seeks to Prosecute Jones Act Suit
CAL DIVE INT'L: Jacob O'Neil Seeks to Prosecute Jones Act Suit
CHEEKY MONK: Case Summary & 15 Largest Unsecured Creditors
CHEYENNE HOTEL: Court Closes Chapter 11 Case after Dismissal
COMSTOCK MINING: Posts $2.5 Million Net Loss for Second Quarter
CORINTHIAN COLLEGES: Former Students Seek to Recoup $2.5-Bil.
COUTURE HOTEL: Mansa Capital Discovers Undisclosed Financing
CRP-2 HOLDINGS: Case Summary & 26 Largest Unsecured Creditors
CUNNINGHAM LINDSEY: Moody's Lowers CFR to B3, Outlook Stable
CUSTOM ECOLOGY: S&P Rates Proposed $195MM Sr. Sec. Facilities 'B-'
DENDREON CORP: Caradimitropoulo's Bid to Stay Sale Order Denied
DORAL FINANCIAL: Capstone Okayed as Committee's Financial Advisor
DORAL FINANCIAL: Committee Taps Prime Clerk as Information Agent
DORAL FINANCIAL: Court Approves Schulte Roth as Committee Counsel
DORAL FINANCIAL: Ocasio to Continue Services in Ordinary Course
ECO BUILDING: Names Tom Comery as New CEO and President
ECOSPHERE TECHNOLOGIES: William Brisben Reports 26.5% Stake
EXELIXIS INC: Announces Results of METEOR Trial
FIRST DATA: Proposes to Sell $100 Million Class A Shares
GAMING & LEISURE: S&P Keeps 'BB+' CCR on CreditWatch Negative
GEORGETOWN MOBILE: Receiver Excused from Turnover Compliance
HDGM ADVISORY: Henry Mestetsky Approved to Withdraw as Counsel
HERCULES OFFSHORE: SVP Worldwide Drilling Operations Quits
HILL-ROM HOLDINGS: S&P Lowers CCR to 'BB+', Outlook Stable
IBT INTERNATIONAL: Wants Dismissal of Involuntary Petition
LIGHTSQUARED INC: Falcone Relaunches $1.5-Bil. Suit vs. Dish, Ergen
M-6 FARMS: Voluntary Chapter 11 Case Summary
MICHAELS FINCO: Moody's Raises CFR to Ba3, Outlook Positive
MIDSTATES PETROLEUM: Receives Noncompliance Notice From NYSE
MILAGRO HOLDINGS: Aug. 21 Hearing on RSA, Other Motions
MILLENNIUM HEALTH: S&P Puts 'B' CCR on CreditWatch Negative
MOHEGAN TRIBAL: S&P Affirms 'B-' Issuer Credit Rating
MOLYCORP INC: Has $291-Mil. DIP Loan from Oaktree
MOLYCORP INC: Obtains Court Approval for DIP Financing Package
MONTREAL MAINE: Canadian Unit Seeks U.S. Recognition of CCAA Plan
MS D'IBERVILLE: Case Summary & Largest Unsecured Creditors
NATIONAL MORTGAGE: S&P Assigns 'BB-' Counterparty Credit Rating
NAVISTAR INT'L: S&P Rates New $1.040-Bil. Sr. Secured Loan 'B-'
NAVISTAR INTERNATIONAL: Extends ABL Facility Maturity by One Year
NAVISTAR INTERNATIONAL: Refinances Senior Term Loan Facility
NET DATA: Buchalter Nemer Okayed as Counsel for the Committee
NET DATA: Lesnick Prince Okayed as General Bankruptcy Counsel
NY PORT AUTHORITY: Moody's Corrects Rating Histories on 2 Bonds
OSI RESTAURANT: Moody's Raises CFR to Ba2, Outlook Stable
PATRIOT COAL: Spilman Thomas Files Rule 2019 Statement
PATRIOT COAL: Stites & Harbison Files Rule 2019 Statement
PATRIOT COAL: Whiteford Taylor Files Rule 2019 Statement
PINNACLE ENTERTAINMENT: Fitch Puts B+ IDR on Positive Watch
SANUWAVE HEALTH: Chief Financial Officer Barry Jenkins Quits
SPIRIT AIRLINES: Fitch Publishes 'BB+' Issuer Default Rating
SPIRIT AIRLINES: S&P Assigns 'BB-' CCR, Outlook Stable
SRS LLC: Voluntary Chapter 11 Case Summary
SULLIVAN INTERNATIONAL: US Trustee to Continue Meeting on Aug. 4
TALEN ENERGY: S&P Puts 'BB-' ICR on CreditWatch Negative
TERRAFORM GLOBAL: Moody's Assigns 'B1' Corp. Family Rating
TMT USA: Su Wants Conversion; Committee to Pursue Claims
TWENTYEIGHTY INC: S&P Lowers CCR to 'B-' & Puts on Watch Negative
WAVE SYSTEMS: Receives NASDAQ Notice of Non-Compliance
WHITE MARINE: Case Summary & 20 Largest Unsecured Creditors
WPCS INTERNATIONAL: Regains Compliance with NASDAQ Standards
[*] Yellen to Conduct Liquidation of Construction Machinery
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
AMERIRESOURCE TECH: Case Summary & 13 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: AmeriResource Technologies, Inc.
One Palmer Square, Suite 315
Princeton, NJ 08542
Case No.: 15-23617
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
District of New Jersey (Trenton)
Judge: Hon. Kathryn C. Ferguson
Debtor's Counsel: Brian W. Hofmeister, Esq.
LAW FIRM OF BRIAN W. HOFMEISTER
691 State Highway 33
Trenton, NJ 08619
Tel: (609) 890-1500
Fax: (609) 890-6961
Email: bwh@hofmeisterfirm.com
Total Assets: $350,000
Total Liabilities: $1.6 million
The petition was signed by William Robins, president.
A list of the Debtor's 13 largest unsecured creditors is available
for free at http://bankrupt.com/misc/njb15-23617.pdf
ARCH COAL: Effects One-For-Ten Reverse Stock Split
--------------------------------------------------
Arch Coal, Inc., announced a one-for-ten reverse stock split of its
common stock. Arch's stockholders granted authority to the Arch
Board of Directors to effect this reverse stock split at the
company's annual meeting of stockholders on April 23, 2015. The
reverse stock split is expected to take place after market close on
July 27, 2015. It also is expected that Arch's common stock will
begin trading on a split-adjusted basis on the New York Stock
Exchange at the market open on July 28, 2015.
At the Effective Time, every ten issued and outstanding shares of
Arch's common stock, as well as treasury shares, will be converted
into one share of Arch's common stock. While Arch's common stock
will continue to trade on the NYSE under the symbol "ACI," it will
have a new CUSIP number following the effectiveness of the reverse
stock split. The reverse stock split will not modify any rights or
preferences of Arch's common stock. The reverse stock split is
intended to increase the market price per share of Arch common
stock to allow Arch to maintain the listing of its common stock on
the NYSE.
As a result of the reverse stock split, the number of outstanding
shares of Arch's common stock will be reduced from approximately
213 million to approximately 21.3 million. No fractional shares
will be issued in connection with the reverse stock split.
Instead, stockholders who otherwise would receive fractional shares
will receive, in lieu of such fractional shares, an amount of cash
based on the volume weighted average price of Arch's common stock
for the date of the Effective Time. Holders of Arch's common stock
held in book-entry form or through a bank, broker or other nominee
do not need to take any action in connection with the reverse stock
split. Stockholders of record will be receiving information from
American Stock Transfer & Trust Company, LLC, Arch's transfer
agent, regarding their stock ownership post-split. All other
questions can be directed to the transfer agent, American Stock
Transfer & Trust Company, LLC, who can be reached at (877) 248-6417
or (718) 921-8317.
About Arch Coal
Arch Coal, Inc.'s primary business is the production of thermal and
metallurgical coal from surface and underground mines located
throughout the United States, for sale to utility, industrial and
steel producers both in the United States and around the world. The
Company currently operates mining complexes in West Virginia,
Maryland, Virginia, Illinois, Wyoming and Colorado.
Arch Coal reported a net loss of $558.3 million in 2014, a net loss
of $641.8 million in 2013 and a net loss of $683.7 million in
2012.
As of March 31, 2015, Arch Coal had $8.3 billion in total assets,
$6.7 billion in total liabilities and $1.5 billion in total
stockholders' equity.
* * *
The Troubled Company Reporter, on July 8, 2015, reported that
Fitch Ratings has downgraded the Issuer Default Rating of Arch
Coal, Inc. to 'C' from 'CCC'. The downgrade follows Arch Coal's
announcements of exchange offers which Fitch considers Distressed
Debt Exchanges in accordance with Fitch's Distressed Debt Exchange
criteria.
The TCR, on May 6, 2015, reported that Moody's Investors Service
downgraded the corporate family rating of Arch Coal, Inc to Caa3
from Caa1 and the probability default rating to Caa3-PD from
Caa1-PD. The downgrade follows the continued stress on the coal
sector, and the resulting deterioration in the company's credit
metrics. At the same time, Moody's downgraded the ratings on the
senior secured term loan and bank revolving facility to Caa1 from
B2, the second lien notes to Caa3 from Caa1, and all unsecured
notes to Ca, from Caa2. Moody's also affirmed the Speculative
Grade Liquidity rating of SGL-3. The outlook is negative.
As reported by the TCR on July 9, 2015, Standard & Poor's Ratings
Services said it lowered its corporate credit rating on St.
Louis-based Arch Coal Inc. to 'CC' from 'CCC+'. Standard & Poor's
Ratings Services said it lowered its corporate credit rating on St.
Louis-based Arch Coal Inc. to 'CC' from 'CCC+'. The rating action
reflects Arch Coal's July 3, 2015, announcement of a private debt
exchange offer for its senior unsecured debt.
ARDENT LEGACY: Moody's Assigns B2 CFR; Outlook Stable
-----------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
B2-PD Probability of Default Rating to Ardent Legacy Acquisitions,
Inc.. Moody's also assigned a B1 (LGD 3) rating to the company's
proposed $250 million senior secured term loan due 2021. The
rating outlook is stable.
Moody's understands that the proceeds of the term loan, along with
a considerable equity contribution from Equity Group Investments
plus equity contributions from management and Ventas, will be used
to fund the acquisition of Ardent Legacy Acquisitions, Inc. from
Ventas, Inc. On April 6, 2015, Ardent Medical Services, Inc.
announced its agreement to be acquired by Ventas for approximately
$1.8 billion. Concurrent with the closing of that transaction, the
hospital operations will be separated from the owned real estate
resulting in the newly formed Ardent Legacy Acquisitions, Inc.
Ventas will retain the ownership of the real estate assets and
enter into a long-term master lease with Ardent Legacy
Acquisitions, Inc. The existing ratings of Ardent Medical Services
will be withdrawn at the close of the transaction.
Moody's has assigned these ratings to Ardent Legacy Acquisitions,
Inc.
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
$250 million senior secured term loan due 2021 at B1 (LGD 3)
RATINGS RATIONALE
Ardent's B2 Corporate Family Rating reflects the company's position
as an operator of 14 acute care facilities in three major markets,
its revenues of approximately $2 billion, and its considerable
lease adjusted financial leverage. While funded debt is modest, we
estimate that lease adjusted debt to EBITDA will remain around 6.0
times. The ratings also reflect the concentration of operations in
only three markets and Moody's expectation that the company will
likely pursue additional acquisitions to enhance scale and
diversification. However, the rating is supported by the extent of
services and presence the company has in each of its markets and
the expectation of improving margins and cash flow.
The stable rating outlook reflects Moody's expectation for modest
improvement in margins and cash flow. Additionally, while Ardent
will likely continue to pursue additional investment opportunities,
Moody's anticipates that the company will maintain a disciplined
approach to debt financed acquisitions and entrance into new
markets.
The ratings could be upgraded if the company can reduce leverage
through debt repayment and earnings growth and gain additional
diversification through expansion into new markets. More
specifically, the ratings could be upgraded if lease adjusted debt
to EBITDA is sustained below 4.5 times.
The ratings could be downgraded if Ardent's liquidity weakens or if
the company pursues a significant debt financed acquisition or
shareholder distribution. Finally if lease adjusted debt to EBITDA
is expected to be sustained above 6.0 times, the ratings could also
be downgraded.
The principal methodology used in these ratings was Global
Healthcare Service Providers 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.
ARDENT LEGACY: S&P Assigns 'B' Corp. Credit Rating, Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Nashville, Tenn.-based acute care hospital
operator Ardent Legacy Holdings Inc. The rating outlook is
stable.
At the same time, S&P assigned its 'B' issue-level rating and '3'
recovery rating to Ardent's proposed $250 million senior secured
term loan (to be issued by subsidiary Ardent Legacy Acquisition),
reflecting S&P's expectation for meaningful recovery for lenders in
the event of payment default (at the high end of the 50% to 70%
range).
S&P is withdrawing its corporate credit rating on AHS Medical
Holdings LLC, as the corporate credit rating will now be at Ardent
Legacy Holdings.
"Our ratings on Ardent follows the company's sale to Ventas Inc., a
REIT, and the concurrent spin-off of the company's operations into
a new company that financial sponsors Equity Group Investments will
own with Ventas and the company's management team. Following the
spin-off, Ardent will lease 10 of its facilities from Ventas
pursuant to a long-term master lease," said credit analyst Shannan
Murphy.
The rating outlook is stable, reflecting S&P's expectation that
Ardent will be able to generate around $20 million in discretionary
cash flow in 2016, despite the company's substantial lease
obligations.
S&P could lower the rating if it believes the company cannot
generate positive annual discretionary cash flow on a sustainable
basis. In S&P's view, this could happen if margins decline about
100 basis points in 2016 (as compared to S&P's expectation of
around 100 basis points of margin expansion), resulting in
fixed-charge coverage ratios below 2x and marginal to negative
discretionary cash flow.
Given Ardent's stated focus on growing through acquisitions and its
financial sponsor ownership, S&P believes the company is unlikely
to permanently reduce lease-adjusted leverage below 5x (which would
be commensurate with a higher rating). For this reason, S&P views
an upgrade as unlikely over the next two years.
ASURION LLC: Moody's Lowers CFR to B2, Outlook Stable
-----------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating of Asurion, LLC to B2 from B1 based on the company's
announced plan to increase borrowings by $900 million to help fund
a minority equity buyout as part of an anticipated equity
recapitalization. Moody's also downgraded Asurion's probability of
default rating to B2-PD from B1-PD. The rating agency affirmed
Asurion's first-lien credit facility ratings at Ba3, and downgraded
its second-lien term loan rating to Caa1 from B3 (see below for
complete rating list). The rating outlook for Asurion is stable.
RATINGS RATIONALE
"The downgrade of Asurion's corporate family rating reflects the
group's persistent high financial leverage and sizable payments to
equity holders," said Bruce Ballentine, Moody's lead analyst for
Asurion. "Still, the group generates healthy interest coverage and
free cash flow as a leading provider of protection programs for
wireless devices and consumer electronics."
Asurion's pending transactions involve total cash sources of $1.7
billion, including a new first-lien term loan of $700 million, a
second-lien term loan add-on of $450 million, and existing cash of
$550 million. Cash uses will include repayment of a $250 million
first-lien non-amortizing term loan, equity buyout plus general
corporate purposes totaling about $1.4 billion, and payment of
related fees and expenses.
Giving effect to the proposed transactions, Moody's estimates that
Asurion's pro forma debt-to-EBITDA ratio will be in the range of
7.5x-8x, while (EBITDA - capex) coverage of interest will be in the
range of 1.6x-1.8x. The rating agency views such financial
leverage as aggressive for Asurion's single-B rating category, and
expects it to decline below 7x over the next 12-18 months.
Asurion's business profile encompasses both mobile protection (MP)
and extended service contracts (ESCs). Asurion has a dominant
position in MP distributed through wireless carriers in the US, a
significant presence in MP in Japan, and a growing presence in
other selected international markets. Asurion also has a good
position in the US market for ESCs. The group as a whole has a
record of efficient operations, excellent customer service and
profitable growth in core and related businesses.
Moody's said these strengths are offset by the group's aggressive
capital structure, its business concentrations among certain
wireless carriers and retailers, and slowing growth prospects in
the relatively mature US ESC market. Also, risk management becomes
a greater challenge as the group expands internationally.
Factors that could lead to an upgrade of Asurion's ratings include:
(i) debt-to-EBITDA ratio below 6x, (ii) (EBITDA - capex) coverage
of interest exceeding 2.5x, (iii) free-cash-flow-to-debt ratio
exceeding 6%, and (iv) EBITDA margins exceeding 20%.
Factors that could lead to a further rating downgrade include: (i)
debt-to-EBITDA ratio remaining above 7x, (ii) (EBITDA - capex)
coverage of interest below 1.5x, (iii) free-cash-flow-to-debt ratio
below 3%, or (iv) EBITDA margins below 15%. Also, the first-lien
credit facilities could be downgraded in the event of a shift in
the funding mix toward first-lien from second-lien borrowings.
Moody's has taken these rating actions with respect to Asurion and
its credit facilities (including loss given default (LGD)
assessments):
Corporate family rating downgraded to B2 from B1;
Probability of default rating downgraded to B2-PD
from B1-PD;
$190 million first-lien revolving credit facility
due 2019 assigned rating of Ba3 (LGD3) (reflects
proposed $90 million increase to existing revolver
with one-year extension);
$4,038 million (outstanding) first-lien term loan due
2019 affirmed at Ba3 (LGD3);
$835 million first-lien term loan due 2020 affirmed
at Ba3 (LGD3);
$250 million first-lien non-amortizing term loan due
2017 affirmed at Ba3 (LGD3) (loan to be repaid under
proposed transactions);
New $700 million first-lien term loan due 2022 assigned
rating of Ba3 (LGD3);
$2,150 million second-lien term loan due 2021 downgraded
to Caa1 (LGD5) from B3 (LGD5) (reflects proposed $450
million add-on to existing loan).
The principal methodology used in these ratings was Moody's Global
Rating Methodology for Insurance Brokers and Service Companies
published in February 2012. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Based in Nashville, Tennessee, Asurion is a leading provider of
protection programs for wireless devices and consumer electronics
both domestically and internationally. Asurion is indirectly owned
by NewAsurion Corporation, whose ownership is divided among four
private equity firms (Madison Dearborn, Providence Equity, Wells
Carson and Berkshire Partners), the Canadian Pension Plan
Investment Board and company management.
ATLANTIC & PACIFIC: Stop & Shop Expands Presence in New York
------------------------------------------------------------
The Stop & Shop Supermarket Company LLC on July 20 disclosed that
that it has entered into an agreement with The Great Atlantic &
Pacific Tea Company to acquire 25 A&P stores in Greater New York
for $146 million. The agreement relates to the following stores:
Waldbaum's
67 Newtown Ln
East Hampton, NY
Waldbaum's
167 Main St
Southampton, NY
Waldbaum's
905 Atlantic Ave
Baldwin, NY
Waldbaum's
702 Hicksville Rd
Massapequa, NY
Waldbaum's
112 15 Beach Channel Dr
Belle Harbor, NY
Waldbaum's
213-215 26th Ave
Bayside, NY
Waldbaum's
156 01 Crossbay Blvd
Howard Beach, NY
Waldbaum's
85 E Park Ave
Long Beach, NY
Waldbaum's
60 Wall St
Huntington, NY
Pathmark
407 Valley St
South Orange, NJ
Pathmark
25 Kinnelon Rd
Butler, NJ
Pathmark
130 Wheatly Plz
Greenvale, NY
Pathmark
134-40 Springfield Blvd
Springfield Gardens, NY
Pathmark
625 Atlantic Ave
Brooklyn, NY
Pathmark
3106 Farrington St
Flushing, NY
Pathmark
4055 Merrick Rd
Seaford, NY
Pathmark
92 10 Atlantic Ave
Ozone Park, NY
Pathmark
460 Franklin Ave
Franklin Square, NY
Pathmark
2965 Cropsey Ave
Brooklyn, NY
Pathmark
2136 Bartow Ave
Bronx, NY
Pathmark
961 E 174th St
Bronx, NY
Pathmark
1720 E Chester Rd
Bronx, NY
Pathmark
1351 Forest Ave
Staten Island, NY
A&P
195 N Bedford Rod
Mount Kisco, NY
A&P
400 Demarest Ave
Closter, NJ
The agreement is subject to further terms and conditions set forth
therein and subject to court approval in A&P's bankruptcy case
filed on July 19, 2015, which include the potential of a subsequent
auction under which other higher bid or bids could be received and
accepted by A&P for these stores. The agreement is also
conditioned on regulatory requirements, including expiration of the
applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976.
"Stop & Shop is always looking for convenient locations to better
serve our customers," said Don Sussman, Stop & Shop's New York
Metro Division President. "We are very happy to have the
opportunity to expand our presence in greater New York and serve
new customers. We look forward to providing customers with
delivering unmatched selection, quality and value that they have
come to expect from Stop & Shop."
Upon completion of the transaction, Stop & Shop plans to convert
these Waldbaum's, Pathmark and A&P stores into Stop & Shop stores.
Additional details regarding the conversions will be announced at a
later date. The sale is currently expected to close within the
second half of 2015.
About Stop & Shop
The Stop & Shop Supermarket Company LLC --
http://www.stopandshop.com-- employs over 59,000 associates and
operates 394 stores throughout Massachusetts, Connecticut, Rhode
Island, New York and New Jersey. The company helps support local
communities fight hunger, combat childhood cancer and promote
general health and wellness -- with emphasis on children's
educational and support programs. In its commitment to be a
sustainable company, Stop & Shop is a member of the U.S. Green
Building Council and EPA's Smart Way program and has been
recognized by the EPA for the superior energy management of its
stores. Stop & Shop is an Ahold company.
About Atlantic & Pacific
Based in Montvale, New Jersey, The Great Atlantic & Pacific Tea
Company, Inc., and its affiliates are one of the nation's oldest
leading supermarket and food retailers, operating approximately 300
supermarkets, beer, wine, and liquor stores, combination food and
drug stores, and limited assortment food stores across six
Northeastern states. The primary retail operations consist of
supermarkets operated under a variety of well known trade names, or
"banners," including A&P, Waldbaum's, SuperFresh, Pathmark, Food
Basics, The Food Emporium, Best Cellars, and A&P Liquors. The
Company currently employs approximately 28,500 employees, over 90%
of whom are members of one of twelve local unions whose members are
employed by the Debtors under the authority of 35 separate
collective bargaining agreements (collectively, the "CBAs").
Then with 429 stores, A&P and its affiliates filed Chapter 11
petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010, and
in 2012 emerged from Chapter 11 bankruptcy as a privately held
company with 320 supermarkets.
On July, 19, 2015, with 300 stores, A&P and 20 affiliated debtors
each filed a Chapter 11 petition (Bankr. S.D.N.Y.) after reaching
deals for the going concern sales of 120 stores. The Debtors are
seeking joint administration under Case No. 15-23007.
As of Feb. 28, 2015, the Debtors reported total assets of $1.6
billion and liabilities of $2.3 billion.
The Debtors tapped Weil, Gotshal & Manges LLP as counsel, Evercore
Group L.L.C., as investment banker, FTI Consulting, Inc., as
financial advisor, Hilco Real Estate, LLC, as real estate advisor,
and Prime Clerk LLC, as claims and noticing agent.
The Debtors' sale advisors can be contacted at:
EVERCORE GROUP LLC
Paul Billyard
Tel: 212-857-3150
E-mail: billyard@evercore.com
Will Jurist
Tel: 212-849-3637
E-mail: William.jurist@evercore.com
- and -
HILCO REAL ESTATE LLC
Gregory Apter
E-mail: gapter@hilcoglobal.com
Matt Tabloff
E-mail: mtabloff@hilcoglobal.com
ATLANTIC & PACIFIC: Store Closings to Impact KBRA-Rated CMBS
------------------------------------------------------------
Kroll Bond Rating Agency on July 22 disclosed that on Sunday, July
19, 2015, the Great Atlantic & Pacific Tea Company filed for
chapter 11 protection, just three years after emerging from a
previous bankruptcy filing. The company operates 296 grocery
stores under several brands, including: A&P, Food Emporium,
Pathmark, Super Fresh, and Waldbaum's. As a result of the
bankruptcy filing, A&P announced plans to sell 271 stores and close
the remaining 25.
Following the announcements, KBRA evaluated its rated CMBS
transactions universe for securitizations that could be impacted by
the store closings. One transaction, MSBAM 2015-C22, was
identified. The deal has exposure to one loan (1.2%),
Pathmark-Linden, that appeared on the closing list. The related
collateral is a 59,250 sf free standing Pathmark located in Linden,
New Jersey. The property was appraised at $17.7 million in March,
2015, resulting in a 75.0% LTV at securitization. No upfront
re-leasing or re-tenanting reserves were established at closing. A
monthly tenant improvement and leasing reserve of $4,361 is
required, which has accrued to $8,721.
KBRA re-evaluated the property value should the loan default, and
also considered potential carrying costs and disposition fees. The
analysis resulted in a potential loss severity of 43.5% of the
loan's current outstanding principal balance.
At this juncture, the store closing will not prompt any ratings
actions. Should the loan transfer and its loss be materially
higher than our current projection it could result in a Watch
placement and/or downgrade of the 'B-' rating on Class G. KBRA
will continue to monitor the situation, as well as any additional
impacts from A&P store closings or sales on its rated CMBS
universe.
About Kroll Bond Rating Agency
KBRA is registered with the U.S. Securities and Exchange Commission
as a Nationally Recognized Statistical Rating Organization (NRSRO).
In addition, KBRA is recognized by the National Association of
Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).
About Atlantic & Pacific
Based in Montvale, New Jersey, The Great Atlantic & Pacific Tea
Company, Inc., and its affiliates are one of the nation's oldest
leading supermarket and food retailers, operating approximately 300
supermarkets, beer, wine, and liquor stores, combination food and
drug stores, and limited assortment food stores across six
Northeastern states. The primary retail operations consist of
supermarkets operated under a variety of well known trade names, or
"banners," including A&P, Waldbaum's, SuperFresh, Pathmark, Food
Basics, The Food Emporium, Best Cellars, and A&P Liquors. The
Company currently employs approximately 28,500 employees, over 90%
of whom are members of one of twelve local unions whose members are
employed by the Debtors under the authority of 35 separate
collective bargaining agreements (collectively, the "CBAs").
Then with 429 stores, A&P and its affiliates filed Chapter 11
petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010, and
in 2012 emerged from Chapter 11 bankruptcy as a privately held
company with 320 supermarkets.
On July 19, 2015, with 300 stores, A&P and 20 affiliated debtors
each filed a Chapter 11 petition (Bankr. S.D.N.Y.) after reaching
deals for the going concern sales of 120 stores. The Debtors are
seeking joint administration under Case No. 15-23007.
As of Feb. 28, 2015, the Debtors reported total assets of $1.6
billion and liabilities of $2.3 billion.
The Debtors tapped Weil, Gotshal & Manges LLP as counsel, Evercore
Group L.L.C., as investment banker, FTI Consulting, Inc., as
financial advisor, Hilco Real Estate, LLC, as real estate advisor,
and Prime Clerk LLC, as claims and noticing agent.
ATLS ACQUISITION: Needs Until Oct. 12 to Remove Actions
-------------------------------------------------------
ATLS Acquisition, LLC, et al., ask the U.S. Bankruptcy Court for
the District of Delaware to extend the time within which they must
notices of removal of proceedings pursuant to Rule 9027 of the
Federal Rules of Bankruptcy Procedure through and including October
12, 2015.
The Debtors are represented by:
Dennis A. Meloro, Esq.
GREENBERG TRAURIG, LLP
1007 North Orange Street, Suite 1200
Wilmington, DE 19801
Tel: (302) 661-7000
Fax: (302) 661-7360
Email: melorod@gtlaw.com
-- and --
Nancy A. Mitchell, Esq.
Matthew L. Hinker, Esq.
GREENBERG TRAURIG, LLP
200 Park Avenue
New York, New York
Tel: (212) 801-9200
Fax: (212) 6400
Email: mitchelln@gtlaw.com
hinkerm@gtlaw.com
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.
* * *
In November 2014, the Debtor received the green light from the
Bankruptcy Court for its $68.5 million sale to an investment group
led by private equity firm Palm Beach Capital. The auction for
the assets boosted the purchase price by more than $20 million.
Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for
the District of Delaware on July 15, 2015, issued a findings of
fact, conclusions of law, and order confirming the First Amended
Joint Plan of Liquidation of ATLS Acquisition, LLC, and its
affiliated debtors.
The Debtors, the Official Committee of Unsecured Creditors, and
Medco Health Solutions, Inc., anticipate that the Plan will provide
for a 100% recovery to Holders of all allowed claims in the Chapter
11 cases other than the Medco Claims. Embodied in the Amended Plan
are the terms of a settlement which provides for an aggregate $2.4
million distribution in full and final satisfaction of all of
claims that the individual parties may have against the Debtors'
estates, directly or indirectly, for attorneys' fees and costs.
AURORA DIAGNOSTICS: Amends 2014 Credit Agreement with Cerberus
--------------------------------------------------------------
Aurora Diagnostics Holdings, LLC entered into a third amendment to
its financing agreement dated as of July 31, 2014, as amended,
restated, supplemented or otherwise modified from time to time, by
and among Aurora Diagnostics, LLC, as borrower, the Company and
certain subsidiaries of the Borrower parties thereto, as
guarantors, the various lenders from time to time party thereto, as
lenders, and Cerberus Business Finance, LLC, as administrative
agent and collateral agent.
Pursuant to the Financing Agreement, the Borrower borrowed a total
of $25,000,000 under the initial delayed draw term loan. On or
prior to the Third Amendment Effective Date, the Company had
$5,400,000 of excess funds remaining from that Term Loan draw.
The third amendment provides that from and after the Third
Amendment Effective Date until the 60th day after the Third
Amendment Effective Date, the Borrower may use the Excess Loan
Proceeds to (i) consummate certain permitted acquisitions or (ii)
pay the related transaction costs for certain past acquisitions.
However, if the Borrower does not use those Excess Loan Proceeds
for a Permitted Purpose on or prior to the 60th day after the Third
Amendment Effective Date, then pursuant to the terms of the third
amendment, the Borrower must repay the Term Loan in the amount of
the unused Excess Loan Proceeds. The third amendment contains
customary representations and warranties applicable to the Company
and its subsidiaries, including the Borrower.
About Aurora Diagnostics
Headquartered in Palm Beach Gardens, Florida, Aurora Diagnostics
Holdings, LLC, through its subsidiaries, provides physician-based
general anatomic and clinical pathology, dermatopathology,
molecular diagnostic services and other esoteric testing services
to physicians, hospitals, clinical laboratories and surgery
centers. The company recognized approximately $260 million in
revenue for the 12 months ended June 30, 2013. The company is
majority owned by equity sponsors KRG Capital Partners and Summit
Partners.
Aurora Diagnostics reported a net loss of $55.4 million on $243
million of net revenue for the year ended Dec. 31, 2014, compared
to a net loss of $73 million on $248 million of net revenue for
the year ended Dec. 31, 2013.
As of March 31, 2015, the Company had $309 million in total assets,
$426 million in total liabilities and $117 million members'
deficit.
* * *
As reported by the Troubled Company Reporter on Sept. 27, 2013,
Moody's Investors Service downgraded Aurora's Corporate Family
Rating to Caa2 from B3 and Probability of Default Rating to Caa2-
PD from B3-PD. Moody's also lowered the debt ratings of Aurora
Diagnostics Holdings, LLC's and Aurora Diagnostics, LLC
(collectively Aurora). Concurrently, Moody's downgraded Aurora's
Speculative Grade Liquidity Rating to SGL-4 from SGL-3. The
outlook for the ratings remains negative.
The downgrade of the ratings reflects Moody's expectation that the
company will see continued difficulty in mitigating a significant
decline in revenue and EBITDA. This stems from a reduction in
Medicare reimbursement due to a decrease in rates and
sequestration, continued challenging volume growth trends and
threats of additional reimbursement reductions. This will
negatively impact the company's credit metrics, constrain Aurora's
ability to repay debt and pressure the company's liquidity
position. Moody's also has concerns about the sustainability of
the company's capital structure given its significant debt load
and related interest burden.
In the Aug. 7, 2014, edition of the TCR, Standard & Poor's Ratings
Services raised its corporate credit rating on Palm Beach Gardens,
Fla.-based anatomic pathology services provider Aurora Diagnostics
Holdings LLC to 'CCC+' from 'CCC'. The outlook is stable.
BAHA MAR: Bahamas Judge Won't Recognize U.S. Bankruptcy
-------------------------------------------------------
Stephanie Gleason, writing for Dow Jones' Daily Bankruptcy Review,
reported that a Bahamas judge denied Baha Mar Ltd.'s request for
recognition of its U.S. bankruptcy filing at the urging of the
island nation's government and the developer's Chinese creditors.
According to the report, citing a person familiar with the ruling,
the ruling means that the company's assets in the Bahamas,
including the $3.5 billion stalled resort, won't receive full
protection in the Bahamas of the U.S. bankruptcy code, which blocks
creditors from taking legal actions against the company. However,
with the U.S. bankruptcy case pending, creditors with U.S.
operations would still have to answer to that court over actions
taken abroad, the report said.
About Baha Mar
Orlando, Florida-based Northshore Mainland Services Inc., Baha Mar
Enterprises Ltd., and their affiliates sought protection under
Chapter 11 of the Bankruptcy Code on June 29, 2015 (Bankr. D.Del.,
Case No. 15-11402). Baha Mar owns, and is in the final stages of
developing, a 3.3 million square foot resort complex located in
Cable Beach, Nassau, The Bahamas.
The case is assigned to Judge Kevin J. Carey.
The Debtors are represented by Paul S. Aronzon, Esq., and Mark
Shinderman, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Los
Angeles, California; and Gerard Uzzi, Esq., Thomas J. Matz, Esq.,
and Steven Z. Szanzer, Esq., at Milbank, Tweed, Hadley & McCloy
LLP, in New York. The Debtors' Delaware counsel are Laura Davis
Jones, Esq., James E. O'Neill, Esq., Colin R. Robinson, Esq., and
Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware. The Debtors' Bahamian counsel is Glinton
Sweeting O'Brien. The Debtors' special litigation counsel is
Kobre
& Kim LLP. The Debtors' construction counsel is Glaser Weil Fink
Howard Avchen & Shapiro LLP.
The Debtors' investment banker and financial advisor is Moelis
Company LLC. The Debtors' claims and noticing agent is Prime
Clerk
LLC.
BAHA MAR: Meeting of Creditors Set for Aug. 3
---------------------------------------------
The meeting of creditors of Baha Mar Enterprises Ltd. and its
affiliated debtors is set to be held on August 3, 2015, at 10:00
a.m. (prevailing Eastern time), according to a filing with the U.S.
Bankruptcy Court in Delaware.
The meeting will be held at J. Caleb Boggs Federal Building, 5th
Floor, Room 5209, 844 King Street, in Wilmington, Delaware.
The court overseeing the bankruptcy case of a company schedules the
meeting of creditors usually about 30 days after the bankruptcy
petition is filed. The meeting is called the "341 meeting" after
the section of the Bankruptcy Code that requires it.
A representative of the company is required to appear at the
meeting and answer questions under oath. The meeting is presided
over by the U.S. trustee, the Justice Department's bankruptcy
watchdog.
About Baha Mar
Orlando, Florida-based Northshore Mainland Services Inc., Baha Mar
Enterprises Ltd., and their affiliates sought protection under
Chapter 11 of the Bankruptcy Code on June 29, 2015 (Bankr. D.Del.,
Case No. 15-11402). Baha Mar owns, and is in the final stages of
developing, a 3.3 million square foot resort complex located in
Cable Beach, Nassau, The Bahamas.
The case is assigned to Judge Kevin J. Carey.
The Debtors are represented by Paul S. Aronzon, Esq., and Mark
Shinderman, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Los
Angeles, California; and Gerard Uzzi, Esq., Thomas J. Matz, Esq.,
and Steven Z. Szanzer, Esq., at Milbank, Tweed, Hadley & McCloy
LLP, in New York. The Debtors' Delaware counsel are Laura Davis
Jones, Esq., James E. O'Neill, Esq., Colin R. Robinson, Esq., and
Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware. The Debtors' Bahamian counsel is Glinton
Sweeting O'Brien. The Debtors' special litigation counsel is Kobre
& Kim LLP. The Debtors' construction counsel is Glaser Weil Fink
Howard Avchen & Shapiro LLP.
The Debtors' investment banker and financial advisor is Moelis
Company LLC. The Debtors' claims and noticing agent is Prime Clerk
LLC.
BOWIE RESOURCE: S&P Affirms B CCR & Raises Rating on Debt to BB-
----------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'B'
corporate credit rating on Louisville, Ky.-based Bowie Resource
Partners LLC. The outlook is stable.
S&P also raised its rating on the company's first-lien senior
secured debt to 'BB-' from 'B+'. At the same time, S&P revised the
recovery rating on this debt to '1' from '2', which indicates S&P's
expectation of very high (90% to 100%) recovery in the event of a
default. The 'CCC+' ratings on the company's second-lien and
senior unsecured debt are unchanged. The recovery rating on this
debt is '6', which indicates S&P's expectation of negligible (0% to
10%) recovery in the event of a default.
S&P revised the recovery rating on the first-lien term loan due to
the principal amount decreasing while the collateral value at
default remained the same, which resulted in a higher rating.
"The stable outlook reflects our view that Bowie's leverage is
likely to remain below 4x over the next 12 to 24 months," said
Standard & Poor's credit analyst Vania Dimova. "This reflects our
favorable view of the company's price and volume commitments for
the next five to 10 years, which provide earnings stability despite
increased exposure to seaborne thermal markets."
S&P could lower the rating if leverage rises above 5x. This could
happen if thermal coal markets were to materially weaken or the
company experienced a prolonged operational disruption at its Sufco
mine. S&P could also lower the rating if it no longer considered
the company's liquidity position to be adequate. This could happen
if the company does not amend its revolving credit facility to
loosen covenant requirements.
S&P considers an upgrade at this time to be unlikely given the
company's concentration in a single basin and its financial sponsor
ownership.
BRANTLEY LAND & TIMBER: Georgia Land Developer Files for Ch. 11
---------------------------------------------------------------
Brantley Land & Timber Company, LLC, a real estate developer in
Brantley County, Georgia, has filed a Chapter 11 bankruptcy
petition (Bankr. S.D. Ga. Case No. 15-20584) in Brunswick, Georgia,
on July 16, 2015.
BL&T sold lots at its Satilla Plantation, Eagle's Crest, Satilla
Pastures subdivisions in Brantley County.
At the behest of State Bank and Trust Company, the Superior Court
of Fulton County, State of Georgia in Case No. 2009-CV-175618,
appointed Jerry W. Harper as receiver for the Debtor in July 25,
2011. The receiver, who is now in control of the Debtor and its
properties, signed the bankruptcy petition.
In its schedules of assets and liabilities, the Debtor disclosed
that:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $12,333
B. Personal Property $13,995,137
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $11,004,384
E. Creditors Holding
Unsecured Priority
Claims $1,542,966
F. Creditors Holding
Unsecured Non-priority
Claims $404,680
----------- -----------
TOTAL $28,400,000 $15,456,273
Most of the Debtor's assets are on account of mortgage accounts
receivable from lot owners totaling approximately $13 million.
Secured creditor State Bank & Trust Company is owed $11 million.
Brantley County Tax Commissioner is owed $1.54 million on account
of property taxes on lots sold at tax sales. The Tax Commissioner
sold 14 lots of the Debtor in tax sales.
Daniel Dukes, Rodney Cobb, Victor Smith, and Thomas USAF Group,
LLC, each owns 25% of the partnership interests in the Debtor.
The Debtor, which is controlled by the receiver, tapped McCallar
Law Firm as counsel.
C. WONDER: To Sell Assets to Xcel Brands
----------------------------------------
Jacqueline Palank, writing for The Wall Street Journal, reported
that C. Wonder may get new life after Xcel Brands recently said
it's hoping to buy the the apparel, accessory and home goods
chain.
According to the Journal, regulatory filings show that Xcel has
offered $2.5 million in cash and 500,000 shares of its stock to
fund the deal.
About C. Wonder
Founded by J. Christopher Burch in 2010, C. Wonder is a specialty
retailer with retail stores in the United States. With
headquarters in New York, the company sells WOMEN'S CLOTHING,
jewelry, shoes, handbags and other accessories as well as select
home goods under the C. Wonder brand. The Company maintains two
distribution centers in New Jersey.
The Company opened its first retail store in New York in 2011. By
2014, the Company had expanded its operations to include 29
locations across 13 states including its flagship location in
Soho,
New York. Amid mounting losses, C. Wonder closed 16 of its retail
stores by the end of 2014. C. Wonder closed 9 additional stores
in January 2015. As of the bankruptcy filing, C. Wonder had four
retail stores in the U.S. (Soho, Flat Iron, Time Warner Center and
Manhasset).
C. Wonder LLC and its affiliates sought Chapter 11 bankruptcy
protection (Bankr. D.N.J. Lead Case No. 15-11127) in Trenton, New
Jersey on Jan. 22, 2015. The cases are assigned to Judge Michael
B. Kaplan.
The Debtors tapped Cole, Schotz, Meisel, Forman & Leonard, P.A.,
as
counsel, and Marotta, Gund, Budd & Dzera, LLC, as crisis
management
services provider.
As of the Filing Date, the Debtors had assets with a book value of
$43.7 million and liabilities of $61.0 million.
The U.S. Trustee for Region 3 appointed three members to the
Official Committee of Unsecured Creditors. The Creditors'
Committee has tapped Porzio, Bromberg & Newman, P.C., as counsel,
and CBIZ Accounting, Tax & Advisory of New York, LLC, as financial
advisors.
CAESARS ENTERTAINMENT: Bankr. Judge Refuses to Halt Suits v. Parent
-------------------------------------------------------------------
Joseph Checkler, writing for Dow Jones' Daily Bankruptcy Review,
reported that a judge ruled that four creditor lawsuits against
Caesars Entertainment Corp. can continue, saying the bankruptcy of
the casino giant's top operating subsidiary shouldn't delay the
cases against its parent.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.,
is one of the world's largest casino companies. Caesars casino
resorts operate under the Caesars, Bally's, Flamingo, Grand
Casinos, Hilton and Paris brand names. The Company has its
corporate headquarters in Las Vegas. Harrah's announced its
re-branding to Caesar's in mid-November 2010.
In January 2015, Caesars Entertainment and subsidiary Caesars
Entertainment Operating Company, Inc., announced that holders of
more than 60% of claims in respect of CEOC's 11.25% senior secured
notes due 2017, CEOC's 8.5% senior secured notes due 2020 and
CEOC's 9% senior secured notes due 2020 have signed the Amended
and Restated Restructuring Support and Forbearance Agreement,
dated
as of Dec. 31, 2014, among Caesars Entertainment, CEOC and the
Consenting Creditors. As a result, The RSA became effective
pursuant to its terms as of Jan. 9, 2015.
Appaloosa Investment Limited, et al., owed $41 million on account
of 10% second lien notes in the company, filed an involuntary
Chapter 11 bankruptcy petition against CEOC (Bankr. D. Del. Case
No. 15-10047) on Jan. 12, 2015. The bondholders are represented
by
Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP.
CEOC and 172 other affiliates -- operators of 38 gaming and resort
properties in 14 U.S. states and 5 countries -- filed Chapter 11
bankruptcy petitions (Bank. N.D. Ill. Lead Case No. 15-01145) on
Jan. 15, 2015. CEOC disclosed total assets of $12.3 billion and
total debt of $19.8 billion as of Sept. 30, 2014.
Delaware Bankruptcy Judge Kevin Gross entered a ruling that the
bankruptcy proceedings will proceed in the U.S. Bankruptcy Court
for the Northern District of Illinois.
Kirkland & Ellis serves as the Debtors' counsel. AlixPartners is
the Debtors' restructuring advisors. Prime Clerk LLC acts as the
Debtors' notice and claims agent. Judge Benjamin Goldgar presides
over the cases.
The U.S. Trustee has appointed seven noteholders to serve in the
Official Committee of Second Priority Noteholders and nine members
to serve in the Official Unsecured Creditors' Committee.
The U.S. Trustee appointed Richard S. Davis as Chapter 11
examiner.
* * *
The Troubled Company Reporter, on April 27, 2015, reported that
Fitch Ratings has affirmed and withdrawn the Issuer Default
Ratings (IDR) and issue ratings of Caesars Entertainment Operating
Company (CEOC). These actions follow CEOC's Chapter 11 filing on
Jan. 15, 2015. Accordingly, Fitch will no longer provide ratings
or analytical coverage for CEOC.
In addition, Fitch has affirmed the IDR and issue rating of
Chester Downs and Marina LLC (Chester Downs) and the ratings have
been simultaneously withdrawn for business reasons.
CAFE SERENDIPITY: Cancels Distribution Agreement with mCig
----------------------------------------------------------
Cafe Serendipity Holdings, Inc., and mCig, Inc. determined it was
in both parties' interest to terminate the product Distribution
Agreement and the Agreement for the Exchange of Securities,
according to a document filed with the Securities and Exchange
Commission.
About Cafe Serendipity Holdings
Based in Henderson, Nevada, Force Fuels Inc., now known as Cafe
Serendipity Holdings, Inc., owns and operates Cafe Serendipity
Inc., a builder of upscale branded turnkey retail stores, financial
solutions, technology and science to the recreational and medical
marijuana industry. The company plans to market a unique branded
product line of accessories, apparel, coffee and teas, bakery and
other edibles, lotions, marijuana and oils through a coast to coast
franchise and dealer network to the recreational and the
approximately 6,000 existing legal medical marijuana dispensaries
in the USA.
Force Fuels' balance sheet at Oct. 31, 2011, showed $1.06 million
in total assets, $1.42 million in total liabilities, and a
stockholders' deficit of $358,092.
As reported in the TCR on Dec. 6, 2011, Sadler, Gibb & Associates,
LLC, in Salt Lake City, Utah, expressed substantial doubt about
Force Fuels' ability to continue as a going concern, following the
Company's results for the fiscal year ended July 31, 2011. The
independent auditors noted that the Company had accumulated losses
of $3.8 million as of July 31, 2011.
The Company had notified the SEC regarding the late filing of its
quarterly report on Form 10-Q for the period ended Jan. 31, 2012,
citing limited accounting staff and incomplete financial
statements. The Company has not filed any financial report since
the filing of its quarterly report for the period ended Oct. 31,
2011.
CAL DIVE INT'L: Adam Tuma Seeks to Prosecute Jones Act Suit
-----------------------------------------------------------
Adam Tuma, a secured creditor holding preferred maritime lien and
claim, asks the U.S. Bankruptcy Court of the District of Delaware
to lift the automatic stay imposed in the Chapter 11 cases of Cal
Dive International, Inc., et al., to allow him to file and
prosecute his suit for famages arising under 46 U.S.C. Section
30104, et seq., more commonly known as the Jones Act, and under the
general maritime law for unseaworthiness of the Barge Lone Star, in
rem, and for maintenance and cure against the Debtors.
Mark T. Hurford, Esq., at Campbell & Levine, LLC, in Wilmington,
Delaware, explains that the Debtors will not suffer prejudice
should the stay be lifted because Mr. Tuma's claims must eventually
be liquidated before he can recover from the bankruptcy estate.
Mr. Hurford adds that Mr. Tuma will face substantial hardship if
the stay is not lifted. Mr. Tuma is a resident of Louisiana and
the events which form the basis for the district court action
occurred close to Louisiana, in the Gulf of Mexico. If Mr. Tuma is
forced to litigate his claim in Delaware, he would incur the
increased expense of bringing attorneys, witnesses, and physical
evidence to Delaware, the counsel asserts. Lastly, the suit at
issue is a personal injury case based on principles of negligence
and strict liability arising under the Jones Act and general
maritime law against the owner of the vessel upon which the injury
occurred, Mr. Hurford tells the Court.
Mr. Tuma is represented by:
Mark T. Hurford, Esq.
CAMPBELL & LEVINE, LLC
222 Delaware Avenue, Suite 1620
Wilmington, DE 19801
Tel: (302) 426-1900
Fax: (302) 426-9947
Email: mhurford@camlev.com
-- and --
STEVEN P. LEMOINE, Esq.
ROBERT H. SCHMOLKE, A PROFESSIONAL LAW CORPORATION
4313 Bluebonnet Blvd., Suite A
Baton Rouge, LA 70809
Tel: (225) 292-1717
Email: steve@schmolkelaw.com
About Cal Dive
Houston, Texas-based marine contractor Cal Dive International,
Inc., provides manned diving, pipelay and pipe burial, platform
installation and salvage, and light well intervention services to
the offshore oil and natural gas industry on the Gulf of Mexico
OCS, Northeastern U.S., Latin America, Southeast Asia, China,
Australia, West Africa, the Middle East, and Europe. Cal Dive and
its U.S. subsidiaries filed simultaneous voluntary petitions
(Bankr. D. Del. Lead Case No. 15-10458) on March 3, 2015.
Through the Chapter 11 process, the Company intends to sell non-
core assets and intends to reorganize or sell as a going concern
its core subsea contracting business.
Cal Dive disclosed total assets of $571 million and total debt of
$411 million as of Sept. 30, 2015.
The Debtors tapped Richards, Layton & Finger, P.A., as counsel,
O'Melveny & Myers LLP, as co-counsel; Jones Walker Jones Walker
LLP as corporate counsel; and Kurtzman Carson Consultants, LLC, as
claims and noticing agent. The Debtors also tapped Carl Marks
Advisory Group LLC as crisis managers and appoint F. Duffield
Meyercord as chief restructuring officer.
The U.S. Trustee for Region 3 formed a five-member committee of
unsecured creditors in the case. The Committee retained Akin Gump
Strauss Hauer & Feld LLP and Pepper Hamilton LLP as co-counsel;
and Guggenheim Securities, LLC as exclusive investment banker.
Cal Dive Offshore Contractors, Inc., disclosed total assets of
$233,273,806 and $311,339,932 in liabilities as of the Chapter 11
filing.
CAL DIVE INT'L: Jacob O'Neil Seeks to Prosecute Jones Act Suit
--------------------------------------------------------------
Jacob O'Neil, a secured creditor with preferred maritime lien and
claim, asks the U.S. Bankruptcy Court of the District of Delaware
to lift the automatic stay imposed in the Chapter 11 cases of Cal
Dive International, Inc., et al., to file and prosecute his suit
for damages arising under 46 U.S.C. Section 30104, et seq., more
commonly known as the Jones Act, and under the general maritime law
for unseaworthiness of the vessel Uncle John, in rem, and for
maintenance and cure against the Debtors.
Mark T. Hurford, Esq., at Campbell & Levine, LLC, asserts that the
Debtors will not suffer prejudice should the stay be lifted because
Mr. O'Neil's claims must eventually be liquidated before he can
recover from the bankruptcy estate. Mr. Hurford adds that Mr.
O'Neil will face substantial hardship if the stay is not lifted.
The counsel notes that Mr. O'Neil is a resident of Louisiana and
the events which form the basis for the district court action
occurred close to Louisiana, in the Gulf of Mexico. If Mr. O'Neil
is forced to litigate his claim in Delaware, he would incur the
increased expense of bringing attorneys, witnesses, and physical
evidence to Delaware, Mr. Hurford asserts.
Mr. O'Neil is represented by:
Mark T. Hurford, Esq.
CAMPBELL & LEVINE, LLC
222 Delaware Avenue, Suite 1620
Wilmington, DE 19801
Tel: (302) 426-1900
Fax: (302) 426-9947
Email: mhurford@camlev.com
-- and --
Brian C. Colomb, Esq.
DOMENGEAUX WRIGHT ROY EDWARDS & COLOMB, LLC
556 Jefferson St.
Lafayette, LA 70501
Tel: (337) 233-3033
Email: brianc@wrightroy.com
About Cal Dive
Houston, Texas-based marine contractor Cal Dive International,
Inc., provides manned diving, pipelay and pipe burial, platform
installation and salvage, and light well intervention services to
the offshore oil and natural gas industry on the Gulf of Mexico
OCS, Northeastern U.S., Latin America, Southeast Asia, China,
Australia, West Africa, the Middle East, and Europe. Cal Dive and
its U.S. subsidiaries filed simultaneous voluntary petitions
(Bankr. D. Del. Lead Case No. 15-10458) on March 3, 2015.
Through the Chapter 11 process, the Company intends to sell non-
core assets and intends to reorganize or sell as a going concern
its core subsea contracting business.
Cal Dive disclosed total assets of $571 million and total debt of
$411 million as of Sept. 30, 2015.
The Debtors tapped Richards, Layton & Finger, P.A., as counsel,
O'Melveny & Myers LLP, as co-counsel; Jones Walker Jones Walker
LLP as corporate counsel; and Kurtzman Carson Consultants, LLC, as
claims and noticing agent. The Debtors also tapped Carl Marks
Advisory Group LLC as crisis managers and appoint F. Duffield
Meyercord as chief restructuring officer.
The U.S. Trustee for Region 3 formed a five-member committee of
unsecured creditors in the case. The Committee retained Akin Gump
Strauss Hauer & Feld LLP and Pepper Hamilton LLP as co-counsel;
and Guggenheim Securities, LLC as exclusive investment banker.
Cal Dive Offshore Contractors, Inc., disclosed total assets of
$233,273,806 and $311,339,932 in liabilities as of the Chapter 11
filing.
CHEEKY MONK: Case Summary & 15 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Cheeky Monk, LLC
534 E Colfax Ave
Denver, CO 80203
Case No.: 15-18113
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Hon. Sidney B. Brooks
Debtor's Counsel: Jeffrey S. Brinen, Esq.
KUTNER BRINEN GARBER, P.C.
1660 Lincoln St., Ste. 1850
Denver, CO 80264
Tel: 303-832-2400
Email: jsb@kutnerlaw.com
- and -
Keri L. Riley, Esq.
1660 Lincoln St., Ste. 1850
Denver, CO 80202
Tel: 303-832-2400
Fax: 303-832-1510
Email: klf@kutnerlaw.com
Total Assets: $96,436
Total Liabilities: $2.9 million
The petition was signed by Tina Pachorek, managing member.
A list of the Debtor's 15 largest unsecured creditors is available
for free at http://bankrupt.com/misc/cob15-18113.pdf
CHEYENNE HOTEL: Court Closes Chapter 11 Case after Dismissal
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado closed the
Chapter 11 case of Cheyenne Hotels LLC.
On June 12, 2015, the Hon. Thomas B. McNamara dismissed the
Debtor's case after finding that notice of that motion has been
adequate and good cause has been shown for granting that motion,
and the Debtor has consented to dismissal.
The Debtor has consented to the dismissal of the case explaining
that its Chapter 11 Plan has been confirmed and consummated.
As reported in the Troubled Company Reporter on June 3, 2015,
Patrick S. Layng, United States Trustee for Region 19, asked to
dismiss the Debtor's case, saying that cause exists for the
dismissal of the case under Section 1112(b)(4)(K) of the Bankruptcy
Code because the Debtor is delinquent on the payment
of U.S. Trustee Quarterly Fees in the amount of $19,500.
About Cheyenne Hotels
Cheyenne Hotels LLC, which owns and operates the Hampton Inn &
Suites in Colorado Springs, Colorado, filed for Chapter 11
bankruptcy (Bankr. D. Colo. Case No. 11-37518) on Nov. 25, 2011.
Judge A. Bruce Campbell presides over the case, taking over
from Judge Michael E. Romero. Thomas F. Quinn, Esq., at Thomas
F. Quinn PC, serves as the Debtor's counsel.
Cheyenne Hotels estimated $10 million to $50 million in both
assets and debts. The petition was signed by Tanveer Khan,
manager.
Affiliate Cheyenne Hotel Investments LLC filed for Chapter 11
bankruptcy protection (Bankr. D. Colo. Case No. 11-25379) on
June 28, 2011, disclosing assets of $12,912,702 and liabilities
of $8,074,325 as of the Petition Date. Thomas F. Quinn, Esq.,
also represents Hotel Investments.
Hotel Investments won confirmation of its own Chapter 11 plan on
Aug. 16, 2013. A copy of the Third Amended Plan of Reorganization
dated Aug. 5, 2013, is available at no charge at:
http://bankrupt.com/misc/CHEYENNEHOTEL_3rdAmdPlan.PDF
No committee of creditors or equity security holders was appointed
in the Debtors' cases.
COMSTOCK MINING: Posts $2.5 Million Net Loss for Second Quarter
---------------------------------------------------------------
Comstock Mining Inc. filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
available to common shareholders of $2.5 million on $5.5 million of
total revenues for the three months ended June 30, 2015, compared
to a net loss available to common shareholders of $4.3 million on
$6.2 million of total revenues for the period ended June 30, 2014.
For the six months ended June 30, 2015, the Company reported a net
loss available to common shareholders of $2.1 million on $11.5
million of total revenues compared to a net loss available to
common shareholders of $9.1 million on $11.9 million of total
revenues for the same period last year.
As of June 30, 2015, the Company had $48.8 million in total assets,
$26.8 million in total liabilities and $22 million in total
stockholders' equity.
"Future production rates and gold prices below management's
expectations would adversely affect the Company's results of
operations, financial condition and cash flows. If the Company
were unable to obtain any necessary additional funds, this could
have an immediate material adverse effect on liquidity and could
raise substantial doubt about the Company's ability to continue as
a going concern. In such case, the Company could be required to
limit or discontinue certain business plans, activities or
operations, reduce or delay certain capital expenditures or sell
certain assets or businesses. There can be no assurance that the
Company would be able to take any of such actions on favorable
terms, in a timely manner or at all," the Company states in the
report.
A copy of the Form 10-Q is available for free at:
http://is.gd/rOqEu9
About Comstock Mining
Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based,
gold and silver mining company with extensive, contiguous property
in the historic Comstock district. The Company began acquiring
properties in the Comstock District in 2003. Since then, the
Company has consolidated a substantial portion of the Comstock
district, secured permits, built an infrastructure and brought the
exploration project into test mining production. The Company
continues acquiring additional properties in the Comstock
district, expanding its footprint and creating opportunities for
exploration and mining. The goal of the Company's strategic plan
is to deliver stockholder value by validating qualified resources
(measured and indicated) and reserves (probable and proven) of
3,250,000 gold equivalent ounces by 2013, and commencing
commercial mining and processing operations by 2011, with annual
production rates of 20,000 gold equivalent ounces.
Comstock Mining reported a net loss available to common
shareholders of $13.3 million in 2014, a net loss available
to common shareholders of $25.4 million in 2013 and a
net loss available to common shareholders of $35.1 million in
2011.
CORINTHIAN COLLEGES: Former Students Seek to Recoup $2.5-Bil.
-------------------------------------------------------------
Stephanie Gleason, writing for Dow Jones' Daily Bankruptcy Review,
reported that lawyers representing former students of Corinthian
Colleges Inc. are requesting permission to file a $2.5 billion
claim against the defunct for-profit college operator.
According to the report, the claim would represent the fees,
expenses and lost wages of about 500,000 students who attended one
of the Everest, Heald or WyoTech campuses between 2000 and 2015.
Individual student losses range between $10,000 and $100,000,
lawyers for the committee representing students said in court
documents, the report related.
About Corinthian Colleges
Corinthian Colleges, Inc., Pegasus Education, Inc., and 23
affiliated entities filed voluntary Chapter 11 petitions (Bankr.
D.
Del. Lead Case No. 15-10952) on May 4, 2015, to complete an
orderly
wind down of its operations. The cases are jointly administered
Case No. 15-10952.
Judge Kevin J. Carey presides over the case. Richards, Layton &
Finger, P.A., represents the Debtors in their restructuring
efforts; FTI Consulting, Inc., serves as restructuring advisors;
and Rust Consulting/Omni Bankruptcy serves as claims and noticing
agent.
Corinthian Colleges, Inc., disclosed $721,596,789 in assets and
$2,929,448,278 in liabilities as of the Chapter 11 filing.
The U.S. Trustee for Region 3 appointed five creditors to serve on
the official committee of unsecured creditors.
COUTURE HOTEL: Mansa Capital Discovers Undisclosed Financing
------------------------------------------------------------
Mansa Capital, LLC, in a document supplementing its motion for
relief from the automatic stay, says it has discovered new,
undisclosed postpetition financing obtained by Couture Hotel
Corporation without seeking leave of the bankruptcy court.
Mansa recounts that on June 26, 2015, while conducting a search of
the online property records maintained by office of the Dallas
County Clerk with respect to the Dallas Hotel, counsel for Mansa
discovered a Certified Statement of Transfer of Lien executed by
the Dallas County Tax Assessor-Collector had been recorded against
the Dallas Hotel evidencing new, undisclosed postpetition financing
obtained by the Debtor without seeking leave of Court.
Upon investigation of filings made by Debtor in the past 30 days,
it appears the postpetition financing to pay prepetition
obligations was obtained surreptitiously and not disclosed and
perhaps intentionally covered up after the fact.
A hearing on the stay motion filed by creditors Mansa Capital and
Wyndham Hotels and Resorts, LLC, will be held on July 28, 2015 at
9:15 a.m.
As reported in the Troubled Company Reporter on July 13, 2015,
Wyndham Hotels is asking the Bankruptcy Court for relief from the
automatic stay for authority to terminate a franchise agreement
between WHR and Couture Hotel Corporation, LLC.
About Couture Hotel
Couture Hotel Corporation, fka Hugh Black-St Mary Enterprises,
Inc., owns and operates four hotels: a Wyndham Garden Inn in
Dallas, Texas, consisting of 356 rooms and remodeled in 2013;
Howard Johnson in Corpus Christi, Texas, consisting of 140 rooms
and remodeled in 2012; a Howard Johnson in Las Vegas, Nevada,
consisting of 110 rooms and remodeled in 2012; and an independent
hotel in Las Vegas, Nevada (formerly branded as a Value
Place),consisting of 121 rooms and also remodeled in 2012.
The Las Vegas hotels are located at one of the entrances to
Nellis Air Force base in North Las Vegas. The Debtor owns the
real property and improvements, as well as the franchise rights
to the hotels (except for Las Vegas Value Place).
The Company sought Chapter 11 protection (Bankr. N.D. Tex.
Case No.14-34874) in Dallas, Texas, on Oct. 7, 2014. The case is
assigned to Judge Barbara J. Houser. The Debtor has tapped Mark
Sean Toronjo, Esq., at Toronjo & Prosser Law, as counsel. The
Debtor, in an amended schedules, disclosed $20.8 million in assets
and $27.8 million in liabilities as of the Chapter 11 filing. No
creditors' committee or other official committee been appointed in
the case.
The Debtor sought to extend its exclusive period to confirm a
plan of reorganization until Aug. 5, 2015.
CRP-2 HOLDINGS: Case Summary & 26 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: CRP-2 Holdings AA, L.P.
Two International Place
Suite 2500-AA
Boston, MA 02110
Case No.: 15-24683
Type of Business: The Debtor is a Delaware limited partnership
that was formed in May of 2006 for the primary
purpose of acquiring and managing real property.
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Donald R Cassling
Debtor's Counsel: Joseph D Frank, Esq.
Frances Gecker, Esq.
Reed A Heiligman, Esq.
Jeremy C Kleinman, Esq.
FRANKGECKER LLP
325 N LaSalle Suite 625
Chicago, IL 60654
Tel: 312 - 276-1400
Fax: 312 - 276-0035
Email: jfrank@fgllp.com
fgecker@fgllp.com
rheiligman@fgllp.com
jkleinman@fgllp.com
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $100 million to $500 million
The petition was signed by Neil Waisnor, vice president.
List of Debtor's 26 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
A.I.R. Conditioning Services LLC Trade Debt $140,517
American Landscape LLC Trade Debt $32,049
Colliers Int'l Asset & Property Trade Debt $232,848
Colliers Int'l New England LLC Trade Debt $75,000
Conopco, Inc. Trade Debt $62,199
Cook County Treasurer - $321,318
118 N. Clark, Suite 112
Chicago, IL 60602
Direct Energy Business Trade Debt $49,192
Draper & Kramer, Inc. Trade Debt $75,000
DuPage County Collector $507,971
421 N. County Farm Rd.
Wheaton, IL 60187
Edgley Construction Group Inc. Trade Debt $67,890
Evergreen Janitorial Servs, Inc. Trade Debt $36,452
Fairfax Department of Tax $218,388
Fox Architects, LLC Trade Debt $30,283
Harvard Maintenance, Inc. Trade Debt $48,189
Jones Lang LaSalle Trade Debt $64,008
Kane County Treasurer $225,781
Martone Construction Management Trade Debt $35,491
OnX Managed Services, Inc. Trade Debt $244,638
Town of Southborough $46,093
Township of Piscataway $100,387
Cassidy Turley Commercial Trade Debt $23,015
Real Estate
Fair Lakes League Inc. Trade Debt $19,441
K&M Concrete, Inc. Trade Debt $18,920
Lake County Collector $20,949
Lincoln Property Company Trade Debt $17,604
Plex Systems Inc. Trade Debt $17,557
CUNNINGHAM LINDSEY: Moody's Lowers CFR to B3, Outlook Stable
------------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating of Cunningham Lindsey U.S. Inc. to B3 from B2 based on
declines in revenue and EBITDA resulting in weaker credit metrics.
The rating agency also downgraded Cunningham Lindsey's probability
of default rating to B3-PD from B2-PD, as well as its credit
facility and term loan ratings. The rating outlook for the company
is now stable.
RATINGS RATIONALE
"The rating downgrade reflects the challenges Cunningham Lindsey
faces from the relatively low volumes of catastrophe losses and
other claims in recent years, leading to declines in profitability,
interest coverage and cash flow coverage," said Enrico Leo, Moody's
lead analyst for Cunningham Lindsey. "The company is taking steps
to reduce costs and diversify its service offerings, but we regard
the company's projected credit metrics as more consistent with a B3
corporate family rating."
Moody's said Cunningham Lindsey's ratings reflect its strong market
position in claims management services and its diversified global
customer base. The company manages claims across multiple
jurisdictions for global insurers and self-insured entities -- an
offering that few competitors can match.
These strengths are offset by high financial leverage, low interest
coverage, and fluctuations in the volume of weather-related and
other complex claims, which account for a sizable portion of the
company's revenues. Cunningham Lindsey also faces integration and
execution risk related to mergers and acquisitions along with
potential liabilities from errors and omissions, a risk inherent in
professional services.
Based on Cunningham Lindsey's recent earnings, and giving effect to
certain cost reduction efforts, Moody's estimates that the
company's gross debt-to-EBITDA ratio is in the range of 7x-7.5x,
which is a key driver of the downgrade. While the company
currently maintains a relatively large balance of cash and
equivalents (approximately $63 million as of March 31, 2015), the
rating agency expects that Cunningham Lindsey will use much of this
cash for EBITDA-enhancing acquisitions, as the company seeks to
reverse a three-year decline in revenue and earnings.
Factors that could lead to a rating upgrade include: (i)
debt-to-EBITDA ratio below 5.5x; (ii) (EBITDA - capex) coverage of
interest of 2x or greater, (iii) free-cashflow-to-debt ratio of 5%
or greater. Factors that could lead to a further rating downgrade
include: (i) debt-to-EBITDA ratio above 7.5x, (ii) (EBITDA - capex)
coverage of interest below 1.2x, (iii) free-cash-flow-to-debt ratio
below 2% for a sustained period.
Moody's has downgraded these ratings (and loss given default (LGD)
assessments), with debt amounts outstanding as of March 31, 2015:
Corporate family rating to B3 from B2;
Probability of default rating to B3-PD from
B2-PD;
$510 million first-lien term loan ($498 million
outstanding, maturing 2019) to B2 (LGD3) from B1 (LGD3);
$100 million first-lien revolving credit facility
($58 million outstanding, maturing 2017) to B2 (LGD3)
from B1 (LGD3);
$110 million second-lien term loan ($86 million
outstanding, maturing 2020) to Caa2 (LGD6) from Caa1 (LGD5).
The principal methodology used in this rating was Moody's Global
Rating Methodology for Insurance Brokers & Service Companies
published in February 2012. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Based in Tampa, Florida, Cunningham Lindsey is a leading provider
of independent loss adjusting and claims management services
worldwide. The company provides global outsourcing solutions for
property and casualty insurance and reinsurance companies and
self-insured corporations in 61 countries. The company generated
revenue of $767 million for 2014.
CUSTOM ECOLOGY: S&P Rates Proposed $195MM Sr. Sec. Facilities 'B-'
------------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B-'
issue-level rating (the same level as S&P's corporate credit rating
on the issuer) and '3' recovery rating on Mabelton, Ga.-based
Custom Ecology Inc.'s proposed $195 million senior secured credit
facilities. The '3' recovery rating indicates S&P's expectation
that lenders would receive meaningful (50%-70%; lower end of the
range) recovery of their principal in the event of a payment
default. All of S&P's other ratings on the company are unchanged.
Stafford Logistics Inc. d/b/a Custom Ecology Inc. is the borrower
of the proposed facilities. Custom Ecology Inc. is the parent
holding company and guarantor. The proposed facilities will
consist of a $20 million senior secured revolving credit facility
due 2020 and a $175 million senior secured term loan due 2021. The
company intends to use the proceeds from this transaction, along
with $10 million of its existing cash, to refinance its existing
debt, fund the acquisition of certain assets from Stansley
Industries Inc. and Stansley Transfer Services of Michigan Inc.
(together roughly $17 million), fund an equipment replacement
program, repurchase the minority equity interest of a shareholder,
and to pay for transaction fees and expenses.
S&P's ratings on Custom Ecology Inc. reflect its "weak" business
risk profile, as defined in S&P's criteria, as a provider of
long-haul waste transportation services. Despite the various
acquisitions the company has made during the past few years, the
company's scale of operations remains small relative to other
environmental services firms. With the Stansley acquisition, S&P
expects the company to generate pro forma revenues of just over
$190 million. The ratings also reflect S&P's "highly leveraged"
assessment of the company's financial risk profile, as defined in
S&P's criteria. Custom Ecology Inc. is a portfolio company of its
financial sponsor Kinderhook Industries and has high debt
leverage.
"We estimate that the company's adjusted debt-to-EBITDA ratio will
be over 5x as of the end of 2015. While we view Custom Ecology's
financial policies as aggressive, we also expect the company's
profitability to steadily improve and its liquidity to remain
adequate. We could raise our ratings on the company if it improves
its business risk profile and diversifies its customer base while
generating free operating cash flow on a more consistent basis.
Alternatively, we could lower the ratings if the company
experiences operating difficulties, such as the loss of hauling
volumes, or enters into large debt-financed acquisitions that
pressure its liquidity," S&P said.
RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario assumes a payment default
in 2017, with lower waste volumes stemming from continuing
weak economic conditions, client attrition, and competitive
pricing pressuring the company's margins, working capital,
and cash flow.
-- S&P's analysis assumes the revolver is 85% drawn at the
point of default.
Simulated default and valuation assumptions
-- Simulated year of default: 2017
-- EBITDA at emergence: $28 million
-- EBITDA multiple: 5.0x
Simplified waterfall
-- Net enterprise value: $133 million
-- Valuation split (U.S./non-U.S.): 100%/0%
-- Collateral/noncollateral split: 100%/0%
-- Priority claims (capital leases): $23 million
-- Collateral value available to secured creditors:
$110 million
-- Secured debt: $198 million
-- Recovery expectations: 50%-70% (lower half of the range)
Note: All debt amounts above include six months of prepetition
interest.
RATINGS LIST
Custom Ecology Inc.
Corporate Credit Rating B-/Stable/--
New Ratings
Stafford Logistics Inc. d/b/a Custom Ecology Inc.
Senior Secured
$20 Mil. Revolver Due 2020 B-
Recovery Rating 3L
$175 Mil. Term Loan Due 2021 B-
Recovery Rating 3L
DENDREON CORP: Caradimitropoulo's Bid to Stay Sale Order Denied
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware denied
Michael E. Caradimitropoulo's motion to stay the effectiveness of
the sale order and the closing of the sale pending review by the
Court or appeal to the District Court closing certain Chapter 11
cases of Dendreon Corporation, et al., according to a court filing
by Sean T. Greecher, Esq. Young Conaway Stargatt & Taylor, LLP,
counsel for the Plan Administrator.
On June 2, 2015, the Court entered its Findings of Fact,
Conclusions of Law, and Order Modifying and Confirmation Second
Amended Plan of Liquidation Pursuant to Chapter 11 of the
Bankruptcy Code Proposed By the Debtors, which confirmed the Second
Amended Plan of Liquidation Pursuant to Chapter 11 of the
Bankruptcy Code Proposed by the Debtors.
At the hearing to consider confirmation of the Plan, the Court
scheduled a separate hearing on June 29, 2015 with respect to the
relief sought by Michael E. Caradimitropoulo (the "Movant") in (i)
the Movant's Motion to Stay the Effectiveness of the Sale Order and
the Closing of the Sale Pending Review By This Court and/or Appeal
to the District Court (the "Motion to Stay") and (ii) the Movant's
Limited Objection to Debtor's Plan of Objection (the "Plan
Objection").
At the Hearing, the Court denied the relief sought in the Motion to
Stay and the Plan Objection.
Mr. Caradimitropoulo requested that the Court stay closing of the
sale pending review by the Court or appeal to the District Court.
Parties in interest, including Valeant Pharmaceuticals
International, Inc. and its direct, wholly-owned subsidiary,
Dendreon Pharmaceuticals, Inc., objected to the motin.
The Plan Administrator argued that the Motion To Stay is moot. It
notes that the sale that the motion to stay seeks to stay is
subject to a final order, is not subject to a pending appeal and
has long-since closed.
About Dendreon Corp
With corporate headquarters in Seattle, Washington, Dendreon
Corporation, a biotechnology company focused on the development of
novel cellular immunotherapies to significantly improve treatment
options for cancer patients.
Dendreon's first product, PROVENGE (sipuleucel-T), was approved by
the U.S. Food and Drug Administration (FDA) and became
Commercially available for the treatment of men with asymptomatic
or minimally symptomatic castrate-resistant (hormone-refractory)
prostate cancer in April 2010. Dendreon is traded on the NASDAQ
Global Market under the symbol DNDN.
Dendreon and its U.S. subsidiaries filed for Chapter 11 bankruptcy
protection (Bankr. D. Del.) on Nov. 10, 2014. The Debtors
requested that their cases be jointly administered under Case No.
14-12515. The petitions were signed by Gregory R. Cox, interim
chief financial officer and treasurer.
Dendreon sought bankruptcy protection after it reached agreements
on the terms of a financial restructuring with certain holders of
the Company's 2.875% Convertible Senior Notes due 2016 representing
84% of the $620 million aggregate principal amount of the 2016
Notes. The financial restructuring may take the form of a
stand-alone recapitalization or a sale of the Company or its
assets.
Dendreon Corp, et al., said in a filing with the U.S. Bankruptcy
Court for the District of Delaware that the effective date of their
Second Amended Plan of Liquidation occurred on June 10, 2015.
The Debtors have engaged Skadden, Arps, Slate, Meagher & Flom LLP,
as counsel; Lazard Freres & Co. LLC, as investment banker;
AlixPartners, as restructuring advisors; and Prime Clerk LLC as
claims and noticing agent.
The Debtors disclosed $365 million in total assets and $664 million
in total liabilities as of June 30, 2014.
The U.S. Trustee for Region 3 appointed three members to the
Official Committee of Unsecured Creditors.
DORAL FINANCIAL: Capstone Okayed as Committee's Financial Advisor
-----------------------------------------------------------------
The Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York authorized, on June 15, 2015, the
Official Committee of Unsecured Creditors in the Chapter 11 case of
Doral Financial Corporation, to retain Capstone Advisory Group,
LLC, together with its wholly-owned subsidiary Capstone Valuation
Services, LLC, as its financial advisor, nunc pro tunc to March 26,
2015.
Capstone will render these financial advisory services:
a. actively monitor the auction processes for the Debtor's
business and assets to ensure the process proceeds in the most
efficient manner to maximize recoveries to unsecured creditors;
b. review offers received for the Debtors' assets; and
c. attend and participate in 363 sales process, with counsel, on
behalf of the Committee.
Capstone has agreed to a 20% discount off of the standard hourly
rates. The current standard hourly rates for Capstone (without
discount) are:
Executive Director $625 - $895
Managing Director $475 - $640
Director $425 - $475
Consultant $250 - $375
Support Staff $125 - $325
Capstone professionals anticipated to be assigned to the
engagement through Dec. 31, 2015, and their hourly rates are:
Christopher Kearns $895
John Salomon $825
Jack Surdoval $675
Norman Haslun $640
To the best of the Committee's knowledge, Capstone is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Doral Financial
Doral Financial Corporation is a holding company whose primary
operating asset was equity in Doral Bank. DFC maintains offices
in
New York City, Coral Gables, Florida and San Juan, Puerto Rico.
DFC has three wholly-owned subsidiaries: (i) Doral Properties,
Inc., (ii) Doral Insurance Agency, LLC ("Doral Insurance"), and
(iii) Doral Recovery, Inc.
On Feb. 27, 2015, regulators placed Doral Bank into receivership
and named the Federal Deposit Insurance Corp. as receiver. Doral
Bank served customers through 26 branches located in New York,
Florida, and Puerto Rico.
DFC sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
15-10573) in Manhattan on March 11, 2015. The case is assigned to
Judge Shelley C. Chapman.
DFC estimated $50 million to $100 million in assets and $100
million to $500 million in debt as of the bankruptcy filing.
The Debtor tapped Ropes & Gray LLP as counsel.
The Debtor's Chapter 11 plan and Disclosure Statement are due July
9, 2015. The initial case conference is set for April 10, 2015.
The U.S. trustee overseeing the Chapter 11 case of Doral Financial
Corp. appointed five creditors of the company to serve on the
official committee of unsecured creditors.
DORAL FINANCIAL: Committee Taps Prime Clerk as Information Agent
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on July 23, 2015, at 10:00 a.m., to consider
the motion of the Official Committee of Unsecured Creditors in the
Chapter 11 case of Doral Financial Corporation for permission to
retain Prime Clerk LLC as its information agent, nunc pro tunc to
June 11, 2015.
The Committee requested entry of an order (A) authorizing the
Committee to establish and implement the information sharing
procedures in order to facilitate the Committee's duties under
Section 1102(b)(3) of the Bankruptcy Code to provide general
unsecured creditors with access to information related to the case,
and (B) authorizing the retention of Prime Clerk as Information
Agent for the Committee.
The Committee submits that the retention of Prime Clerk to create
and administer the Committee Web site will be beneficial to the
Debtor's estate in the case.
About Doral Financial
Doral Financial Corporation is a holding company whose primary
operating asset was equity in Doral Bank. DFC maintains offices
in New York City, Coral Gables, Florida and San Juan, Puerto Rico.
DFC has three wholly-owned subsidiaries: (i) Doral Properties,
Inc., (ii) Doral Insurance Agency, LLC ("Doral Insurance"), and
(iii) Doral Recovery, Inc.
On Feb. 27, 2015, regulators placed Doral Bank into receivership
and named the Federal Deposit Insurance Corp. as receiver. Doral
Bank served customers through 26 branches located in New York,
Florida, and Puerto Rico.
DFC sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
15-10573) in Manhattan on March 11, 2015. The case is assigned to
Judge Shelley C. Chapman.
DFC estimated $50 million to $100 million in assets and $100
million to $500 million in debt as of the bankruptcy filing.
The Debtor tapped Ropes & Gray LLP as counsel.
The U.S. trustee overseeing the Chapter 11 case of Doral Financial
Corp. appointed five creditors of the company to serve on the
official committee of unsecured creditors.
DORAL FINANCIAL: Court Approves Schulte Roth as Committee Counsel
-----------------------------------------------------------------
The Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York entered an order authorizing the
Official Committee of Unsecured Creditors to retain Schulte Roth &
Zabel LLP as its lead counsel, nunc pro tunc to March 23, 2015.
The hourly rates of Schulte Roth's personnel are:
Partners $850 - $1,155
Counsel $815 - $1,085
Special Counsel $815 - $835
Associates $335 - $835
Legal Assistants $140 - $400
Schulte Roth has agreed to a 10% reduction to its standard hourly
billing rates.
To the best of the Committee's knowledge, Schulte Roth is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The Committee and Schulte Roth intend to make a reasonable effort
to comply with the U.S. Trustee's requests for information and
additional disclosures as set forth in the Appendix B Guidelines,
both in connection with the application and the interim and final
fee applications to be filed by Schulte Roth in the course of the
engagement.
The firm can be reached at:
Brian D. Pfeiffer, Esq.
Taejin Kim, Esq.
SCHULTE ROTH & ZABEL LLP
919 Third Avenue
New York, NY 10022
Tel: (212) 756-2000
Fax: (212) 593-5955
About Doral Financial
Doral Financial Corporation is a holding company whose primary
operating asset was equity in Doral Bank. DFC maintains offices
in
New York City, Coral Gables, Florida and San Juan, Puerto Rico.
DFC has three wholly-owned subsidiaries: (i) Doral Properties,
Inc., (ii) Doral Insurance Agency, LLC ("Doral Insurance"), and
(iii) Doral Recovery, Inc.
On Feb. 27, 2015, regulators placed Doral Bank into receivership
and named the Federal Deposit Insurance Corp. as receiver. Doral
Bank served customers through 26 branches located in New York,
Florida, and Puerto Rico.
DFC sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
15-10573) in Manhattan on March 11, 2015. The case is assigned to
Judge Shelley C. Chapman.
DFC estimated $50 million to $100 million in assets and $100
million to $500 million in debt as of the bankruptcy filing.
The Debtor tapped Ropes & Gray LLP as counsel.
The Debtor's Chapter 11 plan and Disclosure Statement are due July
9, 2015. The initial case conference is set for April 10, 2015.
The U.S. trustee overseeing the Chapter 11 case of Doral Financial
Corp. appointed five creditors of the company to serve on the
official committee of unsecured creditors.
DORAL FINANCIAL: Ocasio to Continue Services in Ordinary Course
---------------------------------------------------------------
Ferdinand Ocasio, owner of the firm Ocasio Law Firm, filed with the
U.S. Bankruptcy Court Southern District of New York a declaration
in relation to Doral Financial Corporation's application to employ
Ocasio law firm in the ordinary course of its business.
The Debtor wishes that the firm continue providing ordinary course
services during the Chapter 11 case. The declaration is submitted
in compliance with the order authorizing the employment and
compensation of certain professionals in the ordinary course of
business.
The attorneys designated to represent the Debtor will be
compensated $150 per hour.
The firm asserts a prepetition claim of $10,933.
To the best of the Debtor's knowledge, the firm does not represent
or hold any interest adverse to the Debtor or its estate with
respect to the engagement for which we are to be retained.
About Doral Financial
Doral Financial Corporation is a holding company whose primary
operating asset was equity in Doral Bank. DFC maintains offices
in
New York City, Coral Gables, Florida and San Juan, Puerto Rico.
DFC has three wholly-owned subsidiaries: (i) Doral Properties,
Inc., (ii) Doral Insurance Agency, LLC ("Doral Insurance"), and
(iii) Doral Recovery, Inc.
On Feb. 27, 2015, regulators placed Doral Bank into receivership
and named the Federal Deposit Insurance Corp. as receiver. Doral
Bank served customers through 26 branches located in New York,
Florida, and Puerto Rico.
DFC sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
15-10573) in Manhattan on March 11, 2015. The case is assigned to
Judge Shelley C. Chapman.
DFC estimated $50 million to $100 million in assets and $100
million to $500 million in debt as of the bankruptcy filing.
The Debtor tapped Ropes & Gray LLP as counsel.
The Debtor's Chapter 11 plan and Disclosure Statement are due July
9, 2015. The initial case conference is set for April 10, 2015.
The U.S. trustee overseeing the Chapter 11 case of Doral Financial
Corp. appointed five creditors of the company to serve on the
official committee of unsecured creditors.
ECO BUILDING: Names Tom Comery as New CEO and President
-------------------------------------------------------
Mr. Steve Conboy submitted a letter to the Board of Directors of
Eco Building Products, Inc. resigning from the positions of chief
executive officer, president and chairman of the Board, effective
June 15, 2015, according to a document filed with the Securities
and Exchange Commission.
The Board appointed Tom Comery as the Company's chief executive
officer and president. Mr. Comery, age 61, has been a director of
Eco Building since April 6, 2015, and comes to Eco Building with 30
years of building products manufacturing and distribution
experience. The Company and Mr. Comery have not finalized the
terms of the employment and have not entered into a formal
engagement agreement but expect to work out the terms and finalize
an employment agreement in the near future.
Appointment of Committee Members
The Board appointed each of the current independent directors to
each of the following committees:
Audit Committee
- Mark Zorko, Chairman
- Gerald Czarnecki
- Judith Muhlberg
Nominating and Governance Committee
- Gerald Czarnecki, Chairman
- Judith Muhlberg
- Mark Zorko
Compensation Committee
- Judith Muhlberg, Chairwoman
- Mark Zorko
- Gerald Czarnecki
Amendments to Articles of Incorporation
The Board of Directors of Eco Building approved an amendment and
restatement of the Company's Bylaws, effective July 2, 2015.
The Board approved and filed with the Secretary of State for the
State of Colorado, the Articles of Amendment to the Certificate of
Designation of the Preferences, Rights and Limitations of the
Series D 12% Convertible Preferred Stock. The amendment increased
the number of shares of Series D 12% Convertible Preferred Stock
that are designated to be issued from 10,000 shares to 20,000
shares of Series D 12% Convertible Preferred Stock. There were no
other changes to the terms of our Series D 12% Convertible
Preferred Stock. This amendment was approved in writing by a
majority of the holders of the Series D 12% Convertible Preferred
Stock.
On July 2, 2015, the Board of Directors of the Company approved the
adoption of the Audit Committee Charter to regulate the Audit
Committee that was established at the same meeting. Pursuant to
the Audit Committee Charter, the Audit Committee will be comprised
of three or more independent directors who shall be appointed
annually and subject to removal by the Board of Directors of the
Company at any time, and each member of the Audit Committee shall
meet the independence requirements set forth by the rules and
regulations of the Securities and Exchange Commission and any
applicable stock exchange. In addition to the enumerated
responsibilities of the Audit Committee in the Audit Committee
Charter, the primary function of the Audit Committee is to assist
the board of directors of the Company in fulfilling its oversight
responsibilities by reviewing the financial information, the
systems of internal control, and the Company's audit and financial
reporting process.
On July 2, 2015, the Board of Directors of the Company approved the
adoption of the Compensation Committee Charter regulate the
Compensation Committee that was established at the same meeting.
Pursuant to the Compensation Committee Charter, the Compensation
Committee shall be comprised of three or more independent directors
who shall be appointed annually and subject to removal by the Board
of Directors of the Company at any time, and each member of the
Compensation Committee shall meet the independence requirements set
forth by the rules and regulations of the Securities and Exchange
Commission and any applicable stock exchange. In addition to the
enumerated responsibilities of the Compensation Committee in the
Compensation Committee Charter, the primary function of the
Compensation Committee is to assist the board of directors of the
Company in fulfilling its oversight responsibilities by reviewing
the compensation of the highest paid executives of the Company.
On July 2, 2015, the Board of Directors of the Company approved the
adoption of the Nominating and Governance Committee Charter to
regulate the Nominating and Governance Committee that was
established at the same meeting. Pursuant to the Nominating and
Governance Committee Charter, the Nominating and Governance
Committee will be comprised of three or more independent directors
who shall be appointed annually and subject to removal by the Board
of Directors of the Company at any time, and each member of the
Nominating and Governance Committee will meet the independence
requirements set forth by the rules and regulations of the
Securities and Exchange Commission and any applicable stock
exchange. In addition to the enumerated responsibilities of the
Nominating and Governance Committee in the Nominating and
Governance Committee Charter, the primary function of the
Nominating and Governance Committee is to assist the board of
directors of the Company in fulfilling its oversight
responsibilities by reviewing and recommending potential candidates
to fill vacancies on the Board and to oversee that all the
executives are adhering to appropriate governance standards.
On July 13, 2015, the Company was a party to a Leak-Out Agreement
by and between certain stockholders and lenders of the Company.
About Eco Building
Vista, Calif.-based Eco Building Products is a manufacturer of
proprietary wood products treated with an eco-friendly proprietary
chemistry that protects against mold, rot, decay, termites and
fire.
As of March 31, 2015, the Company had $1.47 million in total
assets, $58.3 million in total liabilities and a $56.9 million
total stockholders' deficit.
Eco Building reported a net loss of $28.94 million on $1.46 million
of total revenue for the year ended June 30, 2014, compared to a
net loss of $24.59 million on $5.22 million of total revenue for
the year ended June 30, 2013.
Sadler, Gibb & Associates, LLC, in Salt Lake City, UT, issued a
"going concern" qualification on the consolidated financial
statements for the year ended June 30, 2014. The independent
auditors noted that the Company has generated minimal operating
revenues, losses from operations, significant cash used in
operating activities and its viability is dependent upon its
ability to obtain future financing and successful operations.
These factors raise substantial doubt about the Company's ability
to continue as a going concern.
ECOSPHERE TECHNOLOGIES: William Brisben Reports 26.5% Stake
-----------------------------------------------------------
In an amended Schedule 13D filed with the Securities and Exchange
Commission, William O. Brisben, manager of Brisben Water Solutions,
LLC, disclosed that as of July 9, 2015, he beneficially owned
57,657,884 shares of common stock of Ecosphere Technologies, Inc.,
which represents 26.5 percent of the shares outstanding.
On July 9, 2015, the Issuer received a loan of $250,000 from
Brisben Water. In connection with this loan, the Issuer delivered
to Brisben Water a 10% secured convertible promissory note due
Sept. 12, 2015, and convertible at $0.115 per share. Additionally,
the Issuer issued Brisben Water a warrant to purchase 4,347,826
shares of the Issuer's common stock exercisable at $0.115 per
share.
"The Filing Person may, at any time or from time to time, formulate
plans or proposals regarding the Issuer or its securities to the
extent deemed advisable by the Filing Person in light of his
general investment policies, market conditions, subsequent
developments affecting the Issuer, the general business and future
prospects of the Issuer, or other factors. The Filing Person may
change any of his plans or proposals at any time or from time to
time, and may take any actions he deems appropriate with respect to
his investment. Subject to market conditions, the Filing Person's
general investment policies and other factors, the Filing Person
may continue to hold some or all of his ownership in the Issuer or
may, at any time or from time to time, decrease his ownership
interest in the Issuer. There can be no assurance as to when, over
what period of time, or to what extent he may decide to decrease
his ownership interest in the Issuer."
A copy of the regulatory filing is available for free at:
http://is.gd/I0aMgh
About Ecosphere Technologies
Stuart, Florida-based Ecosphere Technologies (OTC BB: ESPH) --
http://www.ecospheretech.com/-- is a water engineering,
technology licensing and environmental services company that
designs, develops and manufactures wastewater treatment solutions
for industrial markets. Ecosphere, through its majority-owned
subsidiary Ecosphere Energy Services, LLC, provides energy
exploration companies with an onsite, chemical free method to kill
bacteria and reduce scaling during fracturing and flowback
operations.
Ecosphere reported a net loss of $11.5 million on $1.11 million of
total revenues for the year ended Dec. 31, 2014, compared with net
income of $19.2 million on $6.71 million of total revenues for the
year ended Dec. 31, 2013.
As of Dec. 31, 2014, the Company had $15.05 million in total
assets, $3.82 million in total liabilities, $3.8 million in total
redeemable convertible cumulative preferred stock, and $7.42
million in total equity.
Salberg & Company, P.A., in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements for
the year ended Dec. 31, 2014, citing that the Company reported a
net loss of $11.5 million in 2014, and cash used in operating
activities of $4.55 million and $10.3 million in 2014 and 2013,
respectively. At Dec. 31, 2014, the Company had a working capital
deficiency, and accumulated deficit of $2.86 million, and $109
million, respectively. These matters raise substantial doubt about
the Company's ability to continue as a going concern.
EXELIXIS INC: Announces Results of METEOR Trial
-----------------------------------------------
Exelixis, Inc. announced positive top-line results from the primary
analysis of METEOR, Exelixis' phase 3 pivotal trial comparing
cabozantinib to everolimus in patients with metastatic renal cell
carcinoma who have experienced disease progression following
treatment with at least one prior VEGF receptor tyrosine kinase
inhibitor. The trial met its primary endpoint of demonstrating a
statistically significant increase in progression-free survival for
cabozantinib versus everolimus in the first 375 randomized patients
as determined by an independent radiology committee. Cabozantinib
reduced the risk of disease progression or death by 42 percent
compared to the everolimus arm (hazard ratio [HR]=0.58, 95 percent
CI 0.45 - 0.75, p
FIRST DATA: Proposes to Sell $100 Million Class A Shares
--------------------------------------------------------
First Data Corporation filed a Form S-1 registration statement with
the Securities and Exchange Commission relating to the offering of
its Class A common stock for a proposed aggregate offering price of
$100 million.
Prior to this offering, there has been no public market for the
Company's Class A common stock. The Company currently expects that
the initial public offering price of its Class A common stock will
be between $ _______ and $_______ per share. The Company intends
to apply to list its Class A common stock on under
the symbol "______."
Upon consummation of this offering, the Company will have two
classes of common stock: the Company's Class A common stock and its
Class B common stock. The rights of the holders of Class A common
stock and Class B common stock will be identical, except with
respect to voting, conversion, and transfer restrictions applicable
to the Class B common stock. Each share of Class A common stock
will be entitled to one vote. Each share of Class B common stock
will be entitled to ten votes and will be convertible at any time
into one share of Class A common stock.
After the completion of this offering, affiliates of Kohlberg
Kravis Roberts & Co. L.P. (KKR) will continue to control a majority
of the voting power of the Company's common stock. As a result,
the Company will be a "controlled company" within the meaning of
the corporate governance standards of the applicable stock
exchange.
A copy of the preliminary prospectus is available at:
http://is.gd/JNHpyb
About First Data
Based in Atlanta, Georgia, First Data Corporation provides
commerce and payment solutions for financial institutions,
merchants, and other organizations worldwide.
First Data reported a net loss attributable to the Corporation of
$458 million on $11.2 billion of total revenues for the year ended
Dec. 31, 2014, compared with a net loss attributable to the
Corporation of $869 million on $10.8 billion of total revenues
during the prior year.
As of March 31, 2015, the Company had $34.13 billion in total
assets, $31.7 billion in total liabilities, $78 million in
redeemable noncontrolling interest, and $2.35 billion in total
equity.
* * *
The Company carries a 'B3' corporate family rating, with a
stable outlook, from Moody's Investors Service, a 'B' corporate
credit rating, with stable outlook, from Standard & Poor's, and
a 'B' long-term issuer default rating from Fitch Ratings.
GAMING & LEISURE: S&P Keeps 'BB+' CCR on CreditWatch Negative
-------------------------------------------------------------
Standard & Poor's Ratings Services said it kept its ratings on
Wyomissing, Pa.-based gaming real estate investment trust (REIT)
Gaming & Leisure Properties Inc. (GLPI), including its 'BB+'
corporate credit rating, on CreditWatch, where S&P placed them with
negative implications on March 10, 2015.
"The CreditWatch update follows GLPI's announcement today that it
has entered into an agreement to acquire Pinnacle Entertainment
Inc.'s real estate assets for about $5 billion (including
transaction fees and expenses)," said Standard & Poor's credit
analyst Ariel Silverberg.
GLPI plans to fund the acquisition with about $2 billion in new
debt, $1.1 billion in new equity, and through offering Pinnacle
shareholders 56 million GLPI shares. GLPI acquisition financing
plans include a sufficient amount of equity consideration,
including additional shares being offered to Pinnacle shareholders
and additional common stock issuances, such that leverage will not
be above 5.5x following the close of the transaction. The
continued CreditWatch listing reflects uncertainty surrounding the
timing, level, and type of an equity raise, and whether GLPI will
be able to complete its planned equity raise on terms it finds
acceptable. If GLPI is successful at raising the planned level of
equity and leverage does not exceed the company's publicly stated
financial policy goal of 5.5x, which is the threshold at which S&P
would consider lowering GLPI's rating, it expects to affirm all
ratings. S&P has not incorporated an acquisition of the Meadows
Racetrack and Casino, which is currently under litigation. S&P
believes a resolution, if any, may not occur over the near term.
However, in the event that GLPI closes the Meadows acquisition, S&P
believes it would finance the purchase with a mix of debt and
equity such that leverage remains in line with its financial policy
of 5.5x.
In resolving the CreditWatch listing, S&P will monitor the
company's progress in completing its planned equity raise to
partially fund the transaction. In the event the company is
successful in raising the planned level of common stock and
leverage does not rise above 5.5x pro forma for the transactions,
S&P expects to affirm the ratings.
In the event that GLPI is unsuccessful or experiences delays in
raising the level of common stock that it expects to use to partly
fund the acquisition, or if S&P believes the equity raise would be
unsuccessful, it could lower ratings.
GEORGETOWN MOBILE: Receiver Excused from Turnover Compliance
------------------------------------------------------------
The Hon. Tracey N. Wise of the U.S. Bankruptcy Court for the
Eastern District of Kentucky granted, in part, a request to excuse
CFLane, LLC, the receiver appointed for Georgetown Mobile Estate,
LLC, and U.S. Bank National Association, as Trustee, in Trust for
the holders of COMM 2013-CCRE8 Mortgage Trust Commercial Mortgage
Pass-Through Certificates from complying with Section 543(b) of the
Bankruptcy Code.
As reported inthe Troubled Company Reporter on May 28, 2015,
According to the Receiver's counsel, Ellen Arvin Kennedy, Esq., at
Dinsmore & Shohl LLP, in Lexington, Kentucky, CFLane has been
acting as the professional receiver for the Debtor's property since
May 29, 2014. Pursuant to the Receivership Order, CFLane was
given, among others, the authority to take possession of the
Debtor's real and personal property, including a mobile home park
located at 101 Dale Drive, Georgetown, Kentucky.
Ms. Kennedy asserted that removing the Receiver will harm creditors
due to the continued deterioration of the Property and
mismanagement of the Property should it be returned to the Debtor's
control. Ms. Kennedy also asserted that there is cause to excuse
turnover because there is no evidence that a reorganization plan
will be feasible or is likely to be confirmed. She stated that
despite the Debtor's unsupported statements as to its hopes to
reorganize, these prospects are dim. If a turnover of the Property
was allowed, it is unlikely that the Debtor could secure
debtor-in-possession financing and would have difficulty managing
operations day to day, Ms. Kennedy told the Court. There is little
evidence of the Debtor having any ability to carry the Debtor
through reorganization, she adds.
U.S. Bank's counsel, Brian R. Pollock, Esq., at Stites & Harbison,
PLLC, in Louisville, Kentucky, told the Court that the Debtor's
creditors will be better served by permitting the Receiver to
continue to possess, control, and manage the Mobile Home Park and
use the Noteholder's cash collateral under the terms of the
Receivership Order, rather than by turning over the property to the
Debtor, which has a largely-undisputed history of mismanaging
through engaging in self-dealing in violation of the Debtor's
agreements with the Noteholder, ignoring the Receivership Order,
and operating the Mobile Home Park in violation of Kentucky law.
About Georgetown Mobile Estates
Georgetown Mobile Estates, LLC, is a Kentucky corporation with
headquarters in Georgetown, Scott County, Kentucky. Originally
incorporated on Jan. 23, 2006, the Company operates a mobile home
park in three areas on the county line of Scott and Fayette,
Kentucky. The park can take up to 504 customers and, historically,
had an occupancy rate of 92%.
Georgetown Mobile Estates filed a Chapter 11 bankruptcy petition
(Bankr. E.D. Ky. Case No. 15-50945) in Lexington, Kentucky, on May
11, 2015, to take back control of the mobile home park from a
receiver. Daniel E. Sexton, the present owner, signed the
petition.
The bankruptcy case is assigned to Judge Tracey N. Wise. The
Debtor estimated $10 million to $50 million in assets and debt.
The Debtor tapped Bunch & Brock of Lexington, Kentucky, as counsel;
Randy Reynolds of Magnum Capital Consultants, LLC, as financial
advisor; Bradford Burgess of The Thayer Group as financial advisor;
and Glen Dellavalle of Dellavalle Management Group as manager of
business operations.
The U.S. trustee overseeing the Chapter 11 case of Georgetown
Mobile Estates LLC appointed three creditors of the company to
serve on the official committee of unsecured creditors.
HDGM ADVISORY: Henry Mestetsky Approved to Withdraw as Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
authorized Henry Mestetsky to withdraw representation as attorney
for HDGM Advisory Services, LLC, and HDG Mansur Investment
Services, Inc. Christine K. Jacobson, Esq. and Michael W. Hile,
Esq., at Katz & Korin PC, will remain counsel of record for Debtors
in the proceeding.
About HDGM Advisory Services
HDGM Advisory Services, LLC ("MAS") and HDG Mansur Investments
Services, Inc. ("MISI") invest in and develop real estate around
the world. They also provided management and investment services
to real estate funds that were set up as an investment vehicle for
religious Muslims. MISI developed Finzels Reach, a real estate
development in Bristol England. MAS and MISI are directly
or indirectly owned by Harold D. Garrison, who is also a debtor in
possession in a separate chapter 11 case.
MAS and MISI 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, under the lead case -- HDGM
Advisory, Case No. 14-04797.
MAS disclosed $20.3 million in assets and $7.99 million in
liabilities as of the Chapter 11 filing. MISI disclosed $20.4
million in assets and $12.4 million in liabilities. According to
a court filing, the Debtors don't have any secured creditors.
The Debtors have tapped Michael W. Hile, Esq., and Christine K.
Jacobson, Esq., at Katz & Korin PC, as counsel.
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.
The Debtors has until Sept. 28, 2015, to solicit acceptances to
their Joint Plan of Reorganization, as amended. On Nov. 10, 2014,
Debtors filed their First Amended Joint Plan of Reorganization and
their Disclosure Statement. In the Amended Plan, the Debtors
proposed that their estates be liquidated by a Liquidating Trust
that would liquidate assets and claims and distribute recoveries in
accord with the practices of the Bankruptcy Code.
HERCULES OFFSHORE: SVP Worldwide Drilling Operations Quits
----------------------------------------------------------
Terrell L. Carr, senior vice president, Worldwide Drilling
Operations and a named executive officer of Hercules Offshore,
Inc., tendered his resignation effective July 31, 2015. Mr. Carr
will receive certain payments and benefits under his employment
agreement associated with his termination of service.
Fleet Status
On July 21, 2015, the Company posted on its Website at
www.herculesoffshore.com a report entitled "Hercules Offshore Fleet
Status Report". The Fleet Status Report includes the Hercules
Offshore Rig Fleet Status (as of July 21, 2015), which contains
information for each of the Company's drilling rigs, including
contract dayrate and duration. The Fleet Status Report also
includes the Hercules Offshore Liftboat Fleet Status Report, which
contains information by liftboat class for June 2015, including
revenue per day and operating days. The Fleet Status Report is
available at http://is.gd/477R9O
About Hercules Offshore
Hercules Offshore Inc. (NASDAQ: HERO) --
http://www.herculesoffshore.com/-- provides shallow-water
drilling and marine services to the oil and natural gas
exploration and production industry in the United States, Gulf of
Mexico and internationally. The Company provides these services
to integrated energy companies, independent oil and natural gas
operators and national oil companies. The Company operates in six
business segments: Domestic Offshore, International Offshore,
Inland, Domestic Liftboats, International Liftboats and Delta
Towing.
Hercules Offshore reported a net loss of $216 million in 2014,
compared with a net loss of $68.1 million in 2013.
As of March 31, 2015, the Company had $1.93 billion in total
assets, $1.37 billion in total liabilities and $559 million in
stockholders' equity.
* * *
The TCR reported in March 2015 that Moody's Investors Service
downgraded Hercules Offshore, Inc.'s Corporate Family Rating to
Caa2 from B2. The Caa2 Corporate Family Rating (CFR) reflects the
company's contract roll-off and sparse contract coverage through
the June 2016, its aging fleet, and the projection for a
deterioration of its liquidity position.
As reported by the TCR on June 22, 2015, Standard & Poor's Ratings
Services lowered its corporate credit rating on Houston-based
offshore driller Hercules Offshore Inc. to 'CC' from 'CCC+'.
The downgrade follows the Company's announcement that it has
entered into a restructuring support agreement with a steering
group of the company's senior noteholders, collectively owning or
controlling in excess of 67% of the aggregate outstanding principal
amount of the company's 10.25% senior notes due 2019, 8.75% senior
notes due 2021, 7.5% senior notes due 2021, and 6.75% senior notes
due 2022.
HILL-ROM HOLDINGS: S&P Lowers CCR to 'BB+', Outlook Stable
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Hill-Rom Holdings Inc. to 'BB+' from 'BBB', a two-notch
downgrade, following the planned acquisition of Welch Allyn that
will be financed with $2 billion of debt. The outlook is stable.
S&P assigned a 'BBB' issue-level rating to its $2.25 billion
secured facility. The recovery rating is '1', reflecting S&P's
expectation of high (90%-100%) recovery in the event of default.
S&P also lowered its rating to 'BB-' from 'BBB' on the company's
existing unsecured debt. S&P assigned a recovery rating of '6',
reflecting its expectation of negligible (0%-10%) recovery in the
event of default.
"The downgrade of Hill-Rom Holdings Inc. reflects its additional
tolerance of higher debt as it pursues portfolio diversification
and expansion," said credit analyst Tahira Wright. "While the
acquisition of Welch Allyn provides a more diversified product
portfolio by adding medical diagnostic equipment to its existing
beds, surfaces, and surgical equipment portfolio, leverage is
significantly higher than we had previously expected." The stable
outlook reflects S&P's expectation that following the integration
of Welch Allyn, the company will operate with debt leverage near 4x
by 2017, through EBITDA growth and voluntary debt repayment.
S&P could lower the rating if the company experiences significant
integration challenges resulting in slower EBITDA improvement than
S&P forecasts, or accelerates its diversification strategy with
additional debt-financed acquisitions. This would disrupt S&P's
expectation that leverage will decline to below 4x.
An upgrade is unlikely over the near term, given improvements that
are already factored into S&P's assessments. However, S&P could
raise the rating if the company is able to aggressively reduce its
debt burden and commit to a financial policy of operating with
leverage below 3x.
IBT INTERNATIONAL: Wants Dismissal of Involuntary Petition
----------------------------------------------------------
IBT International, Inc., in response to the involuntary petition
against it, asks the U.S. Bankruptcy Court for the Central District
of California to:
1. dismiss the petition; and
2. award judgment against the petitioning creditors in the
amount of any damage proximately caused by the filing of the
involuntary petition.
The Court will consider the matter at a status conference on July
30, 2015, at 10:30 a.m.
As reported in the Troubled Company Reporter on June 11, 2015, an
involuntary petition was filed by the Chapter 7 trustee of Banyan
Limited Partnership, Pear Tree Limited Partnership, and Orange
Blossom Limited Partnership. Thomas H. Casey, the Chapter 7
trustee, wants the U.S. Bankruptcy Court to enter an order for
relief under Chapter 11 of the Bankruptcy Code for IBT on account
of unpaid judgment by the Debtor amounting to $4.71 million:
Claimant Amount
-------- ------
Banyan LP $3,159,183
Pear Tree LP $740,947
Orange Blossom LP $814,832
Banyan, Pear Tree and Orange Blossom, Chapter 7 debtors, each holds
a judgment entered by the Superior Court of the State of
California, for the County of Orange, bearing Case No. 764271, on
Nov. 15, 2011, against IBT, and which has been affirmed on appeal
and is now final and not subject to further review,
* in the principal amount of $2,330,911, plus post-judgment
interest at 10 percent per annum simple interest through the date
of the Petition, in the amount of $828,272, for a total final
judgment balance now due of $3,159,183 for Banyan;
* in the principal amount of $546,686, plus post-judgment
interest of $194,261, for a total final judgment balance now due of
$740,947 for Pear Tree; and
* in the principal amount of $601,200, plus post-judgment
interest of $213,632, for a total final judgment balance now due of
$814,832 for Orange Blossom.
In addition, the trial court has recently awarded fees and costs in
the amount of $9,819 (which are not final and are being reviewed on
appeal), and are therefore not included in the current amount of
the claim. The Chapter 7 Debtors say they may have additional
claims.
Thomas H. Casey, as Chapter 7 Trustee, filed an involuntary Chapter
11 petition for IBT (Bankr. C.D. Cal. Case No. 15-12925) in Santa
Ana, California, on June 8, 2015. Jonathan Paul Chodos, Esq., in
Los Angeles, serves as counsel for the Chapter 7 trustee. Judge
Erithe A. Smith presides over the case.
LIGHTSQUARED INC: Falcone Relaunches $1.5-Bil. Suit vs. Dish, Ergen
-------------------------------------------------------------------
Joseph Checkler, writing for Dow Jones' Daily Bankruptcy Review,
reported that Philip Falcone and his Harbinger Capital Partners
hedge fund firm filed a racketeering lawsuit against Dish Network
Corp. and Chairman Charles Ergen in New York over their investment
in LightSquared, less than three months after a Colorado judge
dismissed a similar suit.
According to the report, in the six-count suit, filed on July 21
with U.S. District Court in Manhattan, Mr. Falcone and Harbinger
again seek $1.5 billion, saying Mr. Ergen violated the Racketeer
Influenced and Corrupt Organizations Act when he acquired the debt
of LightSquared -- the wireless venture controlled by Harbinger --
as Dish was making a bid for the company in bankruptcy court.
About LightSquared Inc.
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, to resolve regulatory issues that have prevented it
from building its coast-to-coast integrated satellite 4G wireless
network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity
and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared
and the lenders were not able to consummate a global restructuring
on terms acceptable to all interested parties.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Alvarez & Marsal North America, LLC, is the
financial
advisor. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
* * *
Bankruptcy Judge Shelley C. Chapman in late March 2015, approved
LightSquared Inc.'s Chapter 11 reorganization plan. As previously
reported by The Troubled Company Reporter, the Debtors, in
December, filed a joint plan and disclosure statement, which
contemplate, among other things, (A) new money investments by the
New Investors in exchange for a combination of preferred and common
equity, (B) the conversion of the Prepetition LP Facility Claims
into new second lien debt obligations, (C) the repayment in full,
in cash, of the Inc. Facility Prepetition Inc. Facility
NonSubordinated Claims immediately following confirmation of the
Plan, (D) the payment in full, in cash, of LightSquared's general
unsecured claims, (E) the provision of $1.25 billion in new money
working capital for the Reorganized Debtors, (F) the assumption of
certain liabilities, (G) the resolution of all inter-Estate
disputes, and (H) the contribution by Harbinger of the Harbinger
Litigations.
M-6 FARMS: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: M-6 Farms
1841 CR 84
Morton, Tx 79346
Case No.: 15-50171
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
Northern District of Texas (Lubbock)
Judge: Hon. Robert L. Jones
Debtor's Counsel: David R. Langston, Esq.
MULLIN, HOARD & BROWN, L.L.P.
P.O. Box 2585
Lubbock, TX 79408-2585
Tel: 806-765-7491
Email: drl@mhba.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Monty Merritt, partner.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
MICHAELS FINCO: Moody's Raises CFR to Ba3, Outlook Positive
-----------------------------------------------------------
Moody's Investors Service upgraded Michaels FinCo Holdings, LLC's
Corporate Family Rating to Ba3 from B1 and Probability of Default
Rating to Ba3-PD from B1-PD. Concurrently, the rating on Michaels
Stores, Inc.'s senior secured term loan due 2020 was upgraded to
Ba2 from Ba3 and its 5.875% subordinated notes due 2020 was
upgraded to B2 from B3. Michaels' Speculative Grade Liquidity
Rating was also raised to SGL-1 from SGL-2 to reflect the company's
very good liquidity profile. The rating outlook is positive.
Subsequent to the action, Moody's will move the Ba3 CFR, Ba3-PD PDR
and SGL-1 ratings to Michael's ultimate parent company, The
Michaels Companies, Inc.
"The upgrade reflects the reduction in adjusted debt due to changes
in Moody's approach for capitalizing operating leases, as well as
Michaels' continued solid operating performance, cash flow
generation and debt reduction," said Moody's Analyst, Mike Zuccaro.
The updated approach for standard adjustments for operating leases
is explained in the cross-sector rating methodology Financial
Statement Adjustments in the Analysis of Non-Financial
Corporations, published on June 15, 2015. As a result of this
change, Michaels' lease-adjusted leverage for the latest twelve
month period ended May 2, 2015 improved to 4.5x from 5.5x under the
prior methodology. Zuccaro added "The positive outlook reflects
our expectation for continued metric improvement over time through
profitable growth, with initiatives such as the expansion of
exclusive or private label merchandise, investments in store
refreshes and remodels, improved omni-channel capabilities,
marketing and customer education programs."
These rating actions were taken:
Michaels FinCo Holdings, LLC:
-- Corporate Family Rating upgraded to Ba3 from B1 Review for
Upgrade;
-- Probability of Default rating upgraded to Ba3-PD from B1-PD
Review for Upgrade;
-- Speculative Grade Liquidity Rating raised to SGL-1 from
SGL-2 Outlook: Positive
Michaels Stores, Inc.
-- 5.875% senior subordinated notes due 2020 upgraded to B2
(LGD5) from B3(LGD5) Review for Upgrade;
-- Senior secured term loan due 2020 upgraded to Ba2 (LGD3)
from Ba3(LGD3) Review for Upgrade;
-- Incremental senior secured term loan due 2020 upgraded to
Ba2 (LGD3) from Ba3(LGD3) Review for Upgrade Outlook:
Positive
RATINGS RATIONALE
Michaels' Ba3 Corporate Family Rating reflects the company's scale
and strong market position in the highly fragmented arts and craft
segments retail. Michael's has a demonstrated track record of
driving growth while maintaining strong operating margins that have
averaged in the mid-teens over the past five years. The rating is
also supported by the relative stability of the arts and craft
segment industry; although, Michaels participates in some segments
that are more sensitive to economic conditions, such as seasonal
decor and custom framing. Liquidity is very good, reflective of
strong positive free cash flow generation, no near dated debt
maturities, no financial maintenance covenants and access to a
sizable asset-based revolver to fund seasonal working capital
requirements if necessary. Constraining the rating is Michaels'
moderate leverage and continued control by private equity sponsors.
Following the July 2015 sale of stock through a secondary
offering, the sponsors continue to own about 63% of the company.
The Ba2 (LGD3) ratings on Michaels' secured term loans are one
notch higher than the Ba3 Corporate Family Rating reflecting their
security interest in certain assets of the company and the
significant level of junior capital in Michaels' capital structure.
The secured term loan rating also takes into consideration the
relatively stronger position of the unrated $650 million asset
based revolver, which has a first lien over the company's most
liquid assets including inventory. The B2 (LGD5) rating on
Michaels Stores' senior subordinated notes reflects their junior
ranking in the company's overall capital structure.
The positive outlook reflects Moody's expectation for continued
metric improvement over time through profitable growth, with
initiatives such as the expansion of exclusive or private label
merchandise, investments in store refreshes and remodels, improved
omni-channel capabilities, marketing and customer education
programs.
Michaels' ratings could be upgraded if the company continues to
demonstrate profitable growth with operating margins sustained in
the mid-teens. Clarity around future financial policies, such as
demonstrating the willingness and ability to sustainably reduce
debt and improve credit metrics, and reduced private equity
ownership could also support a ratings upgrade. Quantitatively,
ratings could be upgraded if the company sustainably reduces lease
adjusted debt/EBITDA below 4.0x and EBITA/interest expense above
3.5x while maintaining good overall liquidity.
Ratings could be downgraded if the company were to see a material
and sustained reversal of sales trends or if operating margins were
to erode, indicating that the company's competitive profile was
weakening. Ratings could also be lowered if the company's
financial policies were to become aggressive, such as maintaining
high leverage due to increased shareholder friendly activities.
Quantitatively, a ratings downgrade could occur if it appears that
leverage rise above 5.0x or interest coverage fall below 2.5x on a
sustained basis.
Michaels Stores, Inc., a wholly owned subsidiary of Michaels FinCo
Holdings, LLC, is the largest dedicated arts and crafts specialty
retailer in North America. The company operated 1,177 Michaels
stores in 49 states and Canada and 118 Aaron Brothers stores as of
May 2, 2015. The company primarily sells general and children's
crafts, home décor and seasonal items, framing and scrapbooking
products. Total sales approach $4.8 billion. Michaels' ultimate
parent company, Michaels Companies, Inc. (ticker "MIK"), is
publicly traded, but remains 63% owned by affiliates of Bain
Capital Partners, LLC and The Blackstone Group, L.P., who acquired
Michaels in 2006.
The principal methodology used in these ratings was 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.
MIDSTATES PETROLEUM: Receives Noncompliance Notice From NYSE
------------------------------------------------------------
Midstates Petroleum Company, Inc., had received notification on
July 16, 2015, from the New York Stock Exchange that the price of
the Company's common stock has fallen below the NYSE's continued
listing standard. The NYSE requires that the average closing price
of a listed company's common stock not be less than $1.00 per share
for a period of over 30 consecutive trading days.
Under NYSE rules, the Company can avoid delisting if, during the
six month period following receipt of the NYSE notice and on the
last trading day of any calendar month, the Company's common stock
price per share and 30 trading-day average share price is at least
$1.00. During this period, the Company's common stock will
continue to be traded on the NYSE, subject to compliance with other
continued listing requirements. On July 15, 2015, the Company
announced a 1-for-10 reverse stock split of the Company's common
stock which will be effective as of the close of business on Aug.
3, 2015. The Company anticipates that when completed, the reverse
stock split will cure the deficiency and return compliance with the
NYSE continued listing requirement.
The NYSE notification does not affect the Company's business
operations or its SEC reporting requirements and does not conflict
with or cause an event of default under any of the Company's
material debt or other agreements.
About Midstates Petroleum Company
Midstates Petroleum Company, Inc. --
http://www.midstatespetroleum.com/-- is an independent exploration
and production company focused on the application of modern
drilling and completion techniques in oil and liquids-rich basins
in the onshore U.S. Midstates' drilling and completion efforts are
currently focused in the Mississippian Lime oil play in Oklahoma
and Anadarko Basin in Texas and Oklahoma. The Company's operations
also include the upper Gulf Coast tertiary trend in central
Louisiana.
Midstates reported net income of $117 million on $794 million of
total revenues for the year ended Dec. 31, 2014, compared to a net
loss of $344 million on $470 million of total revenues for the year
ended Dec. 31, 2013.
As of Dec. 31, 2014, the Company had $2.47 billion in total assets,
$2 billion in total liabilities and $466 million in total
stockholders' equity.
The Company's independent auditor, Deloittee & Touche LLP, in
Houston, Texas, issued a "going concern" qualification on the
consolidated financial statements for the year ended Dec. 31, 2014,
citing that Midstates' projected debt covenant violation and
resulting lack of liquidity raise substantial doubt about its
ability to continue as a going concern.
* * *
Midstates Petroleum carries a 'B' corporate credit rating from
Standard & Poor's Ratings Services.
As reported by the TCR on April 8, 2013, Moody's Investors Service
affirmed Midstates Petroleum's 'B3' Corporate Family Rating.
MILAGRO HOLDINGS: Aug. 21 Hearing on RSA, Other Motions
-------------------------------------------------------
Milagro Oil & Gas and several affiliates sought bankruptcy
protection on July 15, 2015, and are slated to shortly file a
prearranged reorganization plan that was negotiated with secured
creditors and privately held coal company White Oak Resources VI,
LLC.
The Plan is premised on the consummation of a transaction whereby
the Debtors will contribute substantially all of their oil and gas
assets to Hamilton County, Illinois-based White Oak in exchange for
$120 million in cash plus equity in White Oak with an agreed value
of approximately $97 million, pursuant to a Contribution Agreement
dated July 15, 2015.
In addition, to fund the distributions contemplated pursuant to the
Plan, the Debtors will implement a rights offering, whereby the
Debtors will sell a certain portion of the remaining equity
interests in reorganized Milagro Oil & Gas, Inc., at a discount to
eligible noteholders and certain of the equity interests will be
issued as a fee to the noteholders that are backstopping the rights
offering.
The first lien lenders have agreed to provide new money revolving
loans of up to $15 million to fund the Chapter 11 cases.
The Plan proposes to treat claims and interests as follows:
-- The DIP facility provided by the prepetition first lien
lenders and the remaining claims of the prepetition first lien
lenders, if any, will be paid in full;
-- Holders of the prepetition second lien notes will receive 100%
of the equity interests in reorganized MOG will be issued to
holders of the prepetition second lien notes, subject to dilution
from the rights offering. The noteholders will receive
substantially less than payment in full under the Plan.
-- All other secured, administrative expense and priority claims
will be paid in full, as required under Section 1129 of the
Bankruptcy Code.
-- No holders of a general unsecured claim will receive or retain
any property or interest on account of the claim; provided,
however, certain holders of general unsecured claims may obtain a
pro rata share of $1 million of consideration from the noteholders
if they elect to become a "releasing party" under the Plan.
-- No holders of an equity interest in the Debtors will retain
receive or retain any property or interest on account of such
interest.
As of the Petition Date, the Debtors have outstanding principal
indebtedness of $87,625,000 under a first lien secured term loan
provided under a First Lien Financing Agreement with TPG Specialty
Lending, Inc., as administrative agent and certain lenders. The
Debtors also owe $250 million in principal and $65 million in
interest under senior secured second lie notes due 2016 issued by
MOG pursuant to an Indenture, dated as of May 11, 2011, with
Wilmington Trust, N.A., the successor trustee.
The Debtors also have outstanding liabilities that are not related
to funded indebtedness that, as of the Petition Date, total
approximately $16 million of operating obligations already incurred
and approximately $32 million of asset retirement obligations. The
Debtors believe that White Oak has agreed to assume a substantial
portion of these amounts through the Contribution Agreement.
ACON, Guggenheim and West Coast own approximately 44%, 30%, and
14%, respectively, of the equity interests in Milagro Holdings.
At a hearing on Aug. 21, the Debtors will seek approval to assume a
Restructuring Support Agreement dated July 15, 2015, signed by the
Debtors, the first lien agent, holders of 100% of the prepetition
term loan, holders of in excess of 80% of the second lien notes,
and holders of 44% of the outstanding equity interests (ACON). The
RSA binds these supporting parties to support the solicitation and
confirmation of the Plan, which, upon the effective date, will
result in reorganized MOG with a substantial equity interest in
White Oak and no secured debt on account of the term loan or the
second lien notes.
Pursuant to the RSA, the Debtors are required to obtain approval of
the explanatory Disclosure Statement within 60 days after the
Petition Date and obtain confirmation of the Plan no later than 100
days after the Petition Date.
First Day Motions
A hearing on the Debtors' first day motions was held on July 17,
2015 before the Honorable Kevin Gross. A final hearing on certain
of the first day motions will be held on August 21, 2015 at 11:00
a.m. (ET).
Following the July 17 hearing, Judge Gross entered:
-- an order authorizing the Debtors to pay certain wages and
benefits;
-- an order authorizing the Debtors to pay royalty and working
interests;
-- an interim order authorizing the Debtors to establish
procedures for the transfers of equity securities;
-- an order authorizing the Debtors to pay certain prepetition
taxes and regulatory fees;
-- an order authorizing the Debtors to continue their existing
cash management system;
-- an interim order prohibiting utilities from discontinuing
service;
-- an order authorizing the Debtors to continue their liability
and other insurance programs;
-- an interim order authorizing the Debtors to obtain
postpetition financing and use cash collateral.
-- an order authorizing the appointment of Prime Clerk LLC as
claims and noticing agent.
-- an order directing joint administration of the Chapter 11
cases.
A copy of CRO Scott W. Winn's declaration in support of the first
day motions is available for free at:
http://bankrupt.com/misc/Milagro_Oil_1st_Day_Affidavit.pdf
About Milagro Oil
Based in Houston, Texas, Milagro Oil & Gas, Inc. is an independent
oil and gas companies primarily engaged in the acquisition,
exploration, exploitation, development, production and sale of oil
and natural gas reserves. Milagro's historic geographic focus has
been along the onshore Gulf Coast area, primarily in Texas,
Louisiana and Mississippi. Milagro has 1,200 wells in South Texas,
along the Gulf Coast and in Louisiana.
As of March 31, 2015, the book value of Milagro's total assets and
liabilities was approximately $390 million and $468 million,
respectively. Milagro generated revenues of $153.1 million and
$23.5 million during the fiscal year ended Dec. 31, 2014 and the
three month period ended March 31, 2015, respectively.
On July 15, 2015, Milagro Oil & Gas, its parent Milagro Holdings,
LLC, and four affiliated entities each filed a voluntary petition
for relief under Chapter 11 of the United States Bankruptcy Code in
the United States Bankruptcy Court for the District of Delaware.
The cases are pending before the Honorable Kevin Gross and are
jointly administered under In re Milagro Holdings, Case No.
15-11520.
The Debtors tapped (i) Porter Hedges LLP as general counsel; (ii)
Young Conaway Stargatt & Taylor, LLP, as local counsel; (iii)
Zolfo Cooper, LLC, as restructuring advisors; and (iv) Prime Clerk
LLC as claims and noticing agent.
Noteholders that are parties to the RSA have tapped (i) Akin Gump
Strauss Hauer & Feld LLP, as legal counsel, (ii) Richards,
Layton & Finger, P.A., as Delaware legal counsel, and (iii)
Blackstone Advisory Partners L.P., as financial advisor.
The Consenting Noteholders' attorneys can be reached at:
AKIN GUMP STRAUSS HAUER & FELD LLP
One Bryant Park
New York, NY 10036
Attention: Daniel Fisher
E-mail: dfisher@akingump.com
The first lien agent, TPG Specialty Lending, Inc., is represented
by:
SCHULTE ROTH & ZABEL LLP
919 Third Avenue
New York, NY 10022
Attention: Frederic Ragucci
E-mail: frederic.ragucci@srz.com
The supporting equity holders, ACON Milagro Investors, LLC,
ACON-Bastion Partners II, LP, ACONBastion Partners Offshore, LP,
ACON Milagro Second Lien Investors, LLC, and ABP II Milagro AIV,
L.P., in their respective several and not joint capacities as
holders of equity interests, and ACON Funds Management, L.L.C., are
represented by:
HOGAN LOVELLS US LLP
875 Third Avenue
New York, NY 10022
Attention: Christopher R. Donoho III
E-mail: chris.donoho@hoganlovells.com
White Oak is represented by:
LOCKE LORD LLP
600 Travis, Suite 2800
Houston, TX 77002
Attention: Mitchell A. Tiras
E-mail: mtiras@lockelord.com
Fax Number: (713) 229-2674
Telephone: (713) 226-1144
MILLENNIUM HEALTH: S&P Puts 'B' CCR on CreditWatch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services placed all of its ratings,
including its 'B' corporate credit rating, on San Diego-based
clinical toxicology laboratory services provider Millennium Health
LLC on CreditWatch with negative implications.
"The CreditWatch listing reflects our view that there is
considerable uncertainty regarding Millennium's ability to service
its debt over the long term, given the ongoing, rapid deterioration
in the reimbursement rates that the company receives for urine drug
testing as well as the company's need to fund its pending
settlement regarding Medicare overbilling allegations," said credit
analyst Shannan Murphy. "While the amount and timing of any
settlement has not yet been disclosed, we believe the amount will
likely significantly exceed the approximately $60 million in cash
the company held at March 31, 2015. Further, we believe the
company's financial covenants and falling EBITDA would preclude it
from accessing the revolver to fund any settlement. As such, we
believe a lump-sum payment requirement could result in a liquidity
event."
S&P intends to resolve its CreditWatch listing when more
information about Millennium's ability to continue to service its
debt becomes available, including the timing and amount of any
settlement payments to the government or any proposed changes to
its arrangements with its creditors. A multi-notch downgrade is
possible if S&P believes the current capital structure is not
sustainable.
MOHEGAN TRIBAL: S&P Affirms 'B-' Issuer Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services said it affirmed all ratings,
including the 'B-' issuer credit rating and 'B-' senior secured
issue-level ratings, on Uncasville, Conn.-based Mohegan Tribal
Gaming Authority. The rating outlook is stable.
The affirmation of the 'B-' issue-level ratings on MTGA's senior
secured debt incorporates the proposed transaction. The company
plans to use the proceeds from the proposed transaction to redeem a
portion of its 11% senior subordinated notes due 2018.
Standard & Poor's does not assign recovery ratings to Native
American debt issues, as there are sufficient uncertainties
surrounding the exercise of creditor rights against a sovereign
nation. These include: whether the U.S. Bankruptcy Code would
apply, whether a U.S. court would ultimately be the appropriate
venue to settle such a matter, and to what extent a creditor would
be able to enforce any judgment against the sovereign nation. The
notching of S&P's issue-level ratings from our issuer credit rating
on a given Native American issuer reflects the relative position of
each security in the capital structure, incorporating the amount of
higher ranking debt ahead of each issue.
"Our issuer credit rating on MTGA reflects our assessment of its
business risk profile as 'weak' and our assessment of its financial
risk profile as 'highly leveraged,' according to our criteria,"
said Standard & Poor's credit analyst Ariel Silverberg.
The stable rating outlook reflects S&P's expectation for EBITDA
growth and continued deleveraging through 2016 ahead of new
competition. Specifically, S&P expects leverage to improve
slightly, though remain high, at over 6x, through fiscal 2016 and
for interest coverage to be in the high-1x area in fiscal 2015,
improving to the 2x area in fiscal 2016.
S&P believes changes in the competitive landscape from new casinos
in Massachusetts will result in cash flow declines and weaken
leverage and coverage metrics. S&P could lower the rating if new
competition were to come online sooner than it expects or if
operations underperform our current expectations, resulting in a
decline in cash flows to the extent that covenant cushions begin to
tighten or interest coverage declines closer to 1x.
S&P could raise the rating if MTGA experiences faster deleveraging
than S&P currently expects and provides greater cushion in MTGA's
financial profile to absorb the impact of new competition. S&P
would need to believe the company could sustain interest coverage
closer to 2x and generate positive discretionary cash flow even
with additional anticipated competition in 2018.
MOLYCORP INC: Has $291-Mil. DIP Loan from Oaktree
-------------------------------------------------
Molycorp, Inc., et al., seeks authority from the U.S. Bankruptcy
Court for the District of Delaware to obtain postpetition financing
in the aggregate principal amount of up to $291,764,955 from
Oaktree Capital Management L.P. and use cash collateral securing
their prepetition indebtedness from Oaktree.
The DIP Loan consists of (i) a $126,373,626 fully committed and
funded multi-draw term loan, of which $21,978,222 will be available
on an interim basis, and an additional $104,395,404 will be
available upon entry of a final order; and (ii) a roll up of all
outstanding obligations arising under or in connection with the
Oaktree Secured Financings.
OCM MLYCO CTB Ltd., an affiliate of Oaktree and a prepetition
lender of the Debtors, will serve as administrative and collateral
agent. The DIP Loan accrues interest at 7.00% paid in cash and
7.00% paid in kind.
Accoding to Edmon L. Morton, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, the Oaktree DIP Facility will
provide the Debtors with the necessary funding to (a) fund a sales
process pursuant to Section 363 of the Bankruptcy Code and (b)
preserve some of the value of the Mountain Pass Facility by idling
operations and implementing a care and maintenance program. While
idling the Mountain Pass Facility will result in the loss of
approximately 400 jobs in the near term, the idling of the Mountain
Pass Facility by no later than October 5, 2015, is a condition of
the Oaktree DIP Facility, and there is no current alternative that
would permit continued operations at the Mountain Pass Facility,
Mr. Morton tells the Court. Further, an abrupt and disorderly
shutdown of the Mountain Pass Facility that would otherwise occur
absent immediate access to funds under the Oaktree DIP Facility
could, among other things, cause environmental hazards, damage both
equipment and inventory and disrupt the Debtors' supply chain and
marketing channels, thus causing immediate and irreparable harm to
the Debtors' estates, Mr. Morton further tells the Court.
Mr. Morton, in a supplemental motion, tells the Court that the
Debtors are working with Oaktree to finalize the remaining
documents that are relevant to the Revised Oaktree DIP Facility as
soon as possible. To that end, the Debtors intend to file the
proposed credit agreement for the Revised Oaktree DIP Facility and
the proposed final order approving the Revised Oaktree DIP Facility
as soon as they are available.
Mr. Morton adds that after the conclusion of marathon negotiations
during the week of July 6 and proceeding into the weekend, the
Debtors' boards of directors met on July 11 and determined, in the
exercise of their business judgment, that the debtor in possession
financing to be provided by Oaktree as modified by the Revised
Oaktree Term Sheet continues to be the best financing available
under the circumstances.
The Debtors are represented by:
Blake Cleary, Esq.
Edmon L. Morton, Esq.
Justin H. Rucki, Esq.
Ashley E. Jacobs, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square 1000 North King Street
Wilmington, DE 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
-- and --
Paul D. Leake, Esq.
Lisa Laukitis, Esq.
JONES DAY
222 East 41st Street
New York, NY 10017
Tel: (212) 326-3939
Fax: (212) 755-7306
Email: pdleake@jonesday.com
llaukitis@jonesday.com
-- and --
Ryan T. Routh, Esq.
JONES DAY
North Point 901 Lakeside Avenue
Cleveland, OH 44114
Tel: (216) 586-3939
Fax: (216) 579-0212
Email: rrouth@jonesday.com
About Molycorp
Molycorp Inc. -- http://www.molycorp.com/-- is a global rare
earths and rare metals producer. Molycorp owns several prominent
rare earth processing facilities around the world. It has a
workforce of 2,530 employees at locations on three continents.
Molycorp's Mountain Pass Rare Earth Facility in San Bernadino
County, California, is home to one of the world's largest and
richest deposits of rare earths.
Molycorp has corporate offices in the United States, Canada and
China. CEO Geoffrey R. Bedford, and other senior management
members are located in Molycorp's corporate offices in Toronto,
Canada. Other senior manageemnt members are located at its U.S.
corporate headquarters in Greendwood Village, Colorado.
Molycorp reported a net loss of $623 million in 2014, a net loss of
$377 million in 2013 and a net loss of $475 million in 2012.
As of March 31, 2015, the Company had $2.49 billion in total
assets, $1.78 billion in total liabilities and $709 million in
total stockholders' equity.
Molycorp and its North American subsidiaries, together with certain
of its non-operating subsidiaries outside of North America, filed
Chapter 11 voluntary petitions in Delaware (Bankr. D. Del. Lead
Case No. 15-11357) on June 25, 2015, after reaching agreement with
a group of lenders on a financial restructuring. The Chapter 11
cases of Molycorp and 20 affiliated debts are pending before Judge
Christopher S. Sontchi.
The agreement provides for a financial restructuring of the
Company's $1.7 billion in debt and provides up to $225 million in
gross proceeds in new financing to support operations while the
Company completes negotiations with creditors.
The Company's operations outside of North America, with the
exception of non-operating companies in Luxembourg and Barbados,
are excluded from the filings. Molycorp Rare Metals (Oklahoma),
LLC, with operations in Quapaw, Oklahoma, also is excluded from the
filings as it is not 100% owned by the Company.
Molycorp is being advised by the investment banking firm of Miller
Buckfire & Co. and is receiving financial advice from
AlixPartners, LLP. Jones Day and Young, Conaway, Stargatt & Taylor
LLP act as legal counsel to the Company in this process. Prime
Clerk serves as claims and noticing agent.
The U.S. trustee overseeing the Chapter 11 case of Molycorp Inc.
appointed seven creditors of the company to serve on the official
committee of unsecured creditors.
MOLYCORP INC: Obtains Court Approval for DIP Financing Package
--------------------------------------------------------------
Molycorp, Inc., the only global, vertically-integrated producer of
rare earth products used in many electronic, transportation,
industrial and clean energy applications, on July 22 moved forward
with its Chapter 11 process and received Court approval for an
improved debtor-in-possession (DIP) financing package provided by
Oaktree Capital Management LP.
The approved DIP facility of new net financing of $130 million
represents significant improvement over the interim DIP approved by
the Court on July 2, 2015, including additional liquidity, reduced
costs, and additional time to develop a plan of reorganization that
would be in the best interest of all parties.
Molycorp is being advised by the investment banking firm of Miller
Buckfire & Co. and is receiving financial advice from AlixPartners,
LLP. Jones Day and Young, Conaway, Stargatt & Taylor LLP act as
legal counsel to the Company in this process.
For information regarding the Chapter 11 case, please visit
http://cases.primeclerk.com/molycorp
About Molycorp
Molycorp Inc. -- http://www.molycorp.com/-- is a global rare
earths and rare metals producer. Molycorp owns several prominent
rare earth processing facilities around the world. It has a
workforce of 2,530 employees at locations on three continents.
Molycorp's Mountain Pass Rare Earth Facility in San Bernadino
County, California, is home to one of the world's largest and
richest deposits of rare earths.
Molycorp has corporate offices in the United States, Canada and
China. CEO Geoffrey R. Bedford, and other senior management
members are located in Molycorp's corporate offices in Toronto,
Canada. Other senior manageemnt members are located at its U.S.
corporate headquarters in Greendwood Village, Colorado.
Molycorp reported a net loss of $623 million in 2014, a net loss of
$377 million in 2013 and a net loss of $475 million in 2012.
As of March 31, 2015, the Company had $2.49 billion in total
assets, $1.78 billion in total liabilities and $709 million in
total stockholders' equity.
Molycorp and its North American subsidiaries, together with certain
of its non-operating subsidiaries outside of North America, filed
Chapter 11 voluntary petitions in Delaware (Bankr. D. Del. Lead
Case No. 15-11357) on June 25, 2015, after reaching agreement with
a group of lenders on a financial restructuring. The Chapter 11
cases of Molycorp and 20 affiliated debts are pending before Judge
Christopher S. Sontchi.
The agreement provides for a financial restructuring of the
Company's $1.7 billion in debt and provides up to $225 million in
gross proceeds in new financing to support operations while the
Company completes negotiations with creditors.
The Company's operations outside of North America, with the
exception of non-operating companies in Luxembourg and Barbados,
are excluded from the filings. Molycorp Rare Metals (Oklahoma),
LLC, with operations in Quapaw, Oklahoma, also is excluded from the
filings as it is not 100% owned by the Company.
Molycorp is being advised by the investment banking firm of Miller
Buckfire & Co. and is receiving financial advice from
AlixPartners, LLP. Jones Day and Young, Conaway, Stargatt & Taylor
LLP act as legal counsel to the Company in this process. Prime
Clerk serves as claims and noticing agent.
The U.S. trustee overseeing the Chapter 11 case of Molycorp Inc.
appointed seven creditors of the company to serve on the official
committee of unsecured creditors.
MONTREAL MAINE: Canadian Unit Seeks U.S. Recognition of CCAA Plan
-----------------------------------------------------------------
Montreal, Maine & Atlantic Canada Co. ("MMA Canada"), the Canadian
unit of Chapter 11 debtor Montreal, Maine & Atlantic Railway Ltd.
("MMA"), has filed a Chapter 15 bankruptcy petition in Portland,
Maine, to seek recognition and enforcement in the U.S. of the order
by the Quebec Court approving MMA Canada's plan to pay off victims
of the July 2013 derailment.
On July 6, 2013, an unmanned eastbound MMA train with 72 carloads
of crude oil and 5 locomotive units, derailed in Lac-Megantic,
Quebec (the "Derailment"). The Derailment set off several massive
explosions, destroyed part of downtown Lac-Megantic, resulting in
the death of 47 people. A large quantity of oil was released into
the environment, necessitating an extensive cleanup effort which is
still ongoing. As a result of the Derailment and the related
injuries, deaths, and property damage, lawsuits were filed against
MMA and MMA Canada both in the United States and Canada. MMA
Canada and MMA filed reorganization proceedings in Canada and the
United States, respectively.
The Chapter 11 trustee of MMA obtained approval from the U.S.
Bankruptcy Court for the District of Maine, and MMA Canada obtained
approval from the Quebec Court of the sale of the assets of their
respective assets to Railroad Acquisition Holdings LLC following an
auction in January. The sale of MMA's assets closed on May 15,
2014, and upon final regulatory approval, the sale of the MMA
Canada assets closed on June 30, 2014. In total, the Sale resulted
in a $14,250,000 net payment to MMA and MMA Canada.
The Chapter 11 trustee of MMA has submitted a proposed plan of
liquidation. The Trustee filed the Trustee's Plan of Liquidation
dated March 31, 2015, later amended by the Trustee's First Amended
Plan of Liquidation dated July 7, 2015 (the "Chapter 11 Plan"). On
July 17, 2015, the U.S. Court entered an order approving the
disclosure statement and scheduling a hearing to consider
confirmation of the Plan.
On March 31, 2015, MMA Canada filed the Plan of Compromise and
Arrangement Dated March 31, 2015. On June 8, 2015, MMA Canada filed
an Amended Plan of Compromise and Arrangement Dated June 8, 2015
(the "CCAA Plan"). The CCAA Plan was crafted to work in conjunction
with MMA's chapter 11 plan in distributing funds to victims of the
Derailment. On June 9, 2015, the statutorily required meeting of
creditors was held in Lac-Megantic, where the CCAA Plan was
approved with 3,879 positive votes representing approximately (CDN)
$694 million of claims and no negative votes were cast. On May 6,
2015, Canadian Pacific Railway ("CP") filed pleadings arguing that
the Quebec Court lacked jurisdiction to hear the MMA Canada case
under the CCAA and opposing the CCAA Plan. Notwithstanding CP's
opposition, on July 13, 2015, the Québec Court approved the CCAA
Plan by issuing the Judgment on Motion for Approval of the Plan of
Arrangement (the "Plan Sanction Order").
The Settlements
The monitor for MMA Canada appointed by the Quebec Court, the
Chapter 11 trustee for MMA, MMA and MMA Canada, have worked
collectively since the commencement of the cases to engage in
settlement discussions with various parties identified as
potentially liable for damages arising from the Derailment. As a
result of these negotiations, approximately 25 entities or groups
of affiliated entities have entered into settlement agreements,
whereby the "Released Party" (as defined in those agreements) will
contribute to a settlement fund in exchange, inter alia, for a full
and final release of all claims arising out of the Derailment,
including any claims for contribution and/or indemnity (including
contractual indemnity) asserted by third parties, as well as the
protection of a global injunction barring assertion of any
Derailment-related claims against the Released Parties. The
settlement fund is, as of the date hereof, approximately (CDN) $431
million.
As of the filing of this Petition and the CCAA Plan, the Released
Parties include all parties named in lawsuits brought in the United
States by or on behalf of Derailment victims, the US Legal
Representatives, the Province of Québec, and the Trustee arising
out of the Derailment, other than CP. Settlements have been reached
with oil producers, tank car lessors, insurance companies, as well
as all of the directors and officers of MMA and MMA Canada and
various companies related to one or more of the directors. CP is
the sole remaining "Non-Released" (i.e., non-settling) Party. To
the extent a settlement is not reached with CP, it is expected that
litigation will commence and/or continue against CP to recover
damages.
A copy of the Monitor's motion with the U.S. Bankruptcy Court for
an order recognizing the Plan Sanction Order of the Quebec Superior
Court is available for free at:
http://bankrupt.com/misc/MMA_C_M_Sanction_Order.pdf
A copy of the Monitor's verified petition for recognition of the
CCAA proceedings is available for free at:
http://bankrupt.com/misc/MMA_C_Recog_CCAA.pdf
About Montreal Maine
Montreal, Maine & Atlantic Railway Ltd., operated the train that
derailed and exploded in July 2013, killing 47 people and
destroying part of Lac-Megantic, Quebec.
The Company sought bankruptcy protection (Bankr. D. Maine Case No.
13-10670) on Aug. 7, 2013, with the aim of selling its business.
Its Canadian counterpart, Montreal, Maine & Atlantic Canada Co.,
meanwhile, filed for protection from creditors in Superior Court
of Quebec in Montreal.
Bankruptcy Judge Louis H. Kornreich presides over the U.S. case.
Justice Martin Castonguay oversees the case in Canada.
Robert J. Keach, Esq., at Bernstein, Shur, Sawyer, and Nelson,
P.A., serves as Chapter 11 trustee. Michael A. Fagone, Esq., and
D. Sam Anderson, Esq. serves as his counsel. Development
Specialists, Inc., serves as his financial advisor; and Gordian
Group, LLC, serves as his investment banker.
Andrew Adessky at Richter Consulting was named CCAA monitor for MMA
Canada. The CCAA Monitor is represented by Sylvain Vauclair at
Woods LLP. MM&A Canada is represented by Patrice Benoit, Esq., at
Gowling LaFleur Henderson LLP.
MMAA Canada on July 20, 2015, filed a Chapter 15 petition (Bankr.
D. Maine Case No. 15-20518) in Portland, Maine, to seek recognition
of the Quebec Court's order sanctioning its Plan of Arrangement.
The Chapter 15 petition was signed by Richter Advisory Group Inc.,
the monitor. Verrill Dana, LLP, serves as the Monitor's counsel in
the Chapter 15 case.
The U.S. Trustee appointed a four-member official committee of
derailment victims. The Official Committee is represented by
Richard P. Olson, Esq., at Perkins Olson; and Luc A. Despins,
Esq., at Paul Hastings LLP.
The unofficial committee of wrongful death claimants is Represented
by George W. Kurr, Jr., Esq., at Gross, Minsky & Mogul, P.A.;
Daniel C. Cohn, Esq., at Murtha Cullina LLP; Peter J. Flowers,
Esq., at Meyers & Flowers, LLC; Jason C. Webster, Esq., at The
Webster Law Firm; and Mitchell A. Toups, Esq., at Weller, Green
Toups & Terrell LLP.
* * *
Robert J. Keach, the Chapter 11 trustee, has filed a proposed Plan
of Liquidation that proposes to distribute C$275 million (US$220
million) to creditors, including families of the 48 people who died
during the 2013 trail derailment accident.
MS D'IBERVILLE: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
MS D'Iberville LLC 15-51161
c/o Robert A. Byrd
Post Office Box 1939
Biloxi, MS 39530
D'Iberville Landing Casino, LP 15-51162
925 Tommy Munro Drive Ste G
Biloxi, MS 39532
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
Southern District of Mississippi
(Gulfport-6 Divisional Office)
Judge: Hon. Katharine M. Samson
Debtors' Counsel: Robert Alan Byrd, Esq.
P.O. Box 1939
Biloxi, MS 39533
Tel: 228 432-8123
Fax: 228 432-7029
Email: rab@byrdwiser.com
Estimated Estimated
Assets Liabilities
---------- -----------
MS D'Iberville LLC $500K-$1MM $1MM-$10MM
D'Iberville Landing Casino $500K-$1MM $1MM-$10MM
The petition was signed by Terry Moran, member.
A list of MS D'Iberville LLC's eight largest unsecured creditors is
available for free at http://bankrupt.com/misc/mssb15-51161.pdf
A list of D'Iberville Landing Casino's seven largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/mssb15-51162.pdf
NATIONAL MORTGAGE: S&P Assigns 'BB-' Counterparty Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'BBB-'
financial strength and long-term counterparty credit ratings to
National Mortgage Insurance Corp. At the same time, S&P assigned
its 'BB-' long-term counterparty credit rating to NMI Holdings Inc.
The outlook is stable.
"The ratings on NMI Holdings and its primary operating subsidiary,
National Mortgage Insurance Corp. (collectively NMI) reflect our
view of its fair business risk profile and upper adequate financial
risk profile based on a less-than-adequate competitive position,
moderately strong capital and earnings, and adequate financial
flexibility, partially offset by its moderate risk position," said
Standard & Poor's credit analyst Stephen Guijarro. S&P's ratings
further reflect its fair assessment of NMI's management and
governance and adequate enterprise risk management (ERM)
capabilities, which S&P views as of high importance to the ratings.
The rating on NMI Holdings Inc., the holding company, reflects
structural subordination to the policyholders' obligations of its
operating subsidiary.
NMI's business risk profile is fair, reflecting an intermediate
insurance industry and country risk assessment (IICRA) and
less-than-adequate competitive position. NMI faces intermediate
industry and country risk, reflecting very low country risk and
moderate industry risk.
The company is a new entrant, formed in 2011, and is in the process
of establishing itself. Compared with its well-established peers,
the pursuit of relationships with national and regional lenders,
integration of its platform (especially with large national
accounts), and maturing of such relationships will take some time.
As a result the company has written a high proportion of
single-premium business (which in S&P's opinion could exhibit less
profitability), but S&P expects this percentage to decrease as it
establishes a presence in the market.
The stable outlook reflects S&P's view that the company will
continue to make progress in executing its business strategy and
expanding its market presence while maintaining prudent
underwriting. This should enable the company to grow its revenue
base, improve earnings, and maintain capitalization in line with
S&P's expectations.
S&P's ratings on NMI could come under pressure if in addition to
sector considerations, its risk appetite increases, the portfolio
experiences adverse results, capitalization weakens to less than
our expectations, or its financial flexibility is further
constrained due to increased leverage.
S&P' do not expect to raise the ratings during the next two years.
However, S&P could upgrade NMI if the company were to establish a
sustainable foothold in the industry. As the company matures and
is able to develop and season its relationships with lenders, S&P
expects its competitive position to improve. The company's ability
to garner about 7% market share in the near term while maintaining
prudent underwriting and adequate pricing could improve S&P's view
of its competitive position.
NAVISTAR INT'L: S&P Rates New $1.040-Bil. Sr. Secured Loan 'B-'
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating and '2' recovery rating to Navistar International Corp.
subsidiary Navistar Inc.'s proposed $1.040 billion senior secured
term loan due 2020. The '2' recovery rating indicates S&P's
expectation that lenders will receive substantial recovery
(70%-90%; lower end of the range) in a payment default scenario.
Navistar plans to refinance its existing $697.5 million senior
secured term loan due August 2017 with the proposed $1.040 billion
senior secured term loan due August 2020. The refinancing will
extend the maturity of Navistar's term loan and provide the company
with additional liquidity and financial flexibility. Although the
proposed transaction adds additional debt to the company's balance
sheet, this is offset by the incremental improvements that Navistar
continues to make to its operating performance.
S&P's 'CCC+' corporate credit rating and positive outlook on
Navistar reflect the incremental improvements in the company's
profitability and operating results over the last few quarters.
Navistar's operating performance has benefitted from favorable
conditions in its end markets and reduced costs; however, S&P
continues to view the company's business risk as vulnerable and
dependent on favorable economic and business developments to remain
viable.
RECOVERY ANALYSIS
Key analytical factors
-- S&P has completed a review of the recovery analysis and have
assigned its ratings to Navistar Inc.'s senior secured term
loan while maintaining its recovery and issue-level ratings
on Navistar's senior unsecured notes and senior subordinated
convertible notes.
-- S&P's recovery rating on the proposed senior secured term
loan is '2' (70%-90% recovery at the lower half of the
range), reflecting the increase in the company's senior
secured debt while S&P's valuation remains unchanged.
-- S&P's simulated default analysis assumes that the U.S.
economy falls into a financial contraction later in 2016,
causing potential truck, bus, and engine buyers to defer
purchases of new equipment. Navistar is forced to file for
reorganization in 2017 and is able to improve its margins
prior to emergence.
-- Navistar's asset-based lending (ABL) revolver is assumed to
be 60% drawn at default.
Simulated default and valuation assumptions:
-- Simulated year of default: 2017
-- EBITDA at emergence: $525 million
-- EBITDA multiple: 4x
Simplified waterfall
-- Net enterprise value (after 5% admin. costs): $1.995 billion
-- Valuation split (obligors/nonobligors): 45%/55%
-- Priority claims: $105 million
-- Value available to first-lien debt claims
(collateral/noncollateral):
-- $987 million/$13 million
-- Secured first-lien debt claims: $1.304 billion
--Recovery expectations: 70%-90% (lower half of the range)
-- Total value available to unsecured claims: $105 million
-- Senior unsecured debt/pari passu unsecured claims:
$1.507 billion/$1.127 billion
--Recovery expectations: 0%-10%
-- Structurally subordinated debt claims: $625 million
-- Recovery expectations: 0%-10%
Note: All debt amounts include six months of prepetition interest.
Collateral value equals asset pledge from obligors after priority
claims plus equity pledge from nonobligors after nonobligor debt.
RATINGS LIST
Navistar International Corp.
Corporate Credit Rating CCC+/Positive/--
New Ratings
Navistar Inc.
$1.040 Bil. Snr Secrd Trm Ln Due 2020 B-
Recovery Rating 2L
NAVISTAR INTERNATIONAL: Extends ABL Facility Maturity by One Year
-----------------------------------------------------------------
Navistar, Inc., as borrower, entered into an amendment No. 3 to the
Amended and Restated ABL Credit Agreement, dated as of Aug. 17,
2012, among the Borrower, the lenders and Bank of America, N.A., as
administrative agent, pursuant to which:
(i) certain provisions were modified to permit the incurrence
of up to $352,500,000 of additional term loans and the
issuance of up to $200,000,000 of additional senior notes;
(ii) the permitted receivables financing basket was increased
from $25,000,000 to $50,000,000;
(iii) the cash dominion trigger and certain of the definitional
provisions were modified; and
(iv) the maturity date was extended by one year.
The ABL Amendment had no impact on the aggregate commitment level
under the ABL Credit Agreement, which remains at $175,000,000. The
Borrower paid a fee of $262,500 to its asset based lenders in
connection with the ABL Amendment.
A copy of the Amended Credit Agreement is available at:
http://is.gd/9bHWop
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar International reported a net loss attributable to the
Company of $619 million for the year ended Oct. 31, 2014, compared
to a net loss attributable to the Company of $898 million for the
year ended Oct. 31, 2013.
* * *
In the Oct. 9, 2013, edition of the TCR, Moody's Investors Service
affirmed the ratings of Navistar International Corp., including the
'B3' corporate family rating. The ratings reflect Moody's
expectation that Navistar's successful incorporation of Cummins
engines throughout its product line up will enable the company to
regain lost market share, and that progress in addressing component
failures in 2010 vintage-engines will significantly reduce warranty
expenses.
As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings
Services lowered its long-term corporate credit rating on Navistar
International to 'CCC+' from 'B-'. "The rating downgrades reflect
our increased skepticism regarding NAV's prospects for achieving
the market shares it needs for a successful business turnaround,"
said credit analyst Sol Samson.
In January 2013, Fitch Ratings affirmed the issuer default ratings
for Navistar International at 'CCC' and removed the negative
outlook on the ratings. The removal reflects Fitch's view that
immediate concerns about liquidity have lessened, although
liquidity remains an important rating consideration as NAV
implements its selective catalytic reduction engine strategy.
NAVISTAR INTERNATIONAL: Refinances Senior Term Loan Facility
------------------------------------------------------------
Navistar International Corporation announced that it is refinancing
the $697.5 million senior secured term loan facility of Navistar,
Inc., which matures in August 2017, with a new $1.040 billion
senior secured term loan, which will mature in August 2020. The
refinancing will extend the maturity of the term loan facility and
provide additional liquidity and financial flexibility for the
company.
"The company's financial condition and results continue to improve
steadily, and we have begun to generate positive cash flow," said
Walter G. Borst, Navistar chief financial officer. "We're
investing in new products and advancing on our Uptime strategy in
the market, driven by our focus on connected vehicles. The term
loan renewal will provide us additional flexibility to pursue these
initiatives while extending our debt maturity profile."
J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, and
Credit Suisse Securities (USA) LLC will serve as joint lead
arrangers and joint bookrunners. JPMorgan Chase Bank, N.A. will
serve as Administrative Agent and Collateral Agent.
In connection with the proposed Senior Secured Term Loan
refinancing, the Company made a presentation to prospective lenders
on July 21, 2015. Information from the lender presentation related
to the Company is available at:
http://is.gd/lnra1j
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar International reported a net loss attributable to the
Company of $619 million for the year ended Oct. 31, 2014, compared
to a net loss attributable to the Company of $898 million for the
year ended Oct. 31, 2013.
* * *
In the Oct. 9, 2013, edition of the TCR, Moody's Investors Service
affirmed the ratings of Navistar International Corp., including the
'B3' corporate family rating. The ratings reflect Moody's
expectation that Navistar's successful incorporation of Cummins
engines throughout its product line up will enable the company to
regain lost market share, and that progress in addressing component
failures in 2010 vintage-engines will significantly reduce warranty
expenses.
As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings
Services lowered its long-term corporate credit rating on Navistar
International to 'CCC+' from 'B-'. "The rating downgrades reflect
our increased skepticism regarding NAV's prospects for achieving
the market shares it needs for a successful business turnaround,"
said credit analyst Sol Samson.
In January 2013, Fitch Ratings affirmed the issuer default ratings
for Navistar International at 'CCC' and removed the negative
outlook on the ratings. The removal reflects Fitch's view that
immediate concerns about liquidity have lessened, although
liquidity remains an important rating consideration as NAV
implements its selective catalytic reduction engine strategy.
NET DATA: Buchalter Nemer Okayed as Counsel for the Committee
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
authorized the Official Committee of Creditors Holding Unsecured
Claims in the Chapter 11 cases of Net Data Centers, Inc., to retain
Buchalter Nemer as its counsel.
The firm will fees based upon its prevailing hourly guideline
rates, which currently range from $225 per hour for the most junior
associates to $795 per hour for certain of the more senior
partners. The current hourly rates of the individuals who will
provide the majority of services to the Committee during the
administration of the bankruptcy case are:
Steven M. Spector, shareholder $725
Brian T. Harvey, associate $390
The firm has not yet received a retainer for its services but the
application requested that the Court approve a postpetition
retainer paid by the Debtor in monthly increments of $10,000. The
retainer funds will be held in the firm's trust account and applied
to the firm's fees and costs pursuant to the terms of the U.S.
Trustee's Guide to Applications for Retainers, and Professional and
Insider Compensation.
The firm can be reached at:
Steven M. Spector, Esq.
Brian T. Harvey, Esq.
BUCHALTER NEMER, A Professional Corporation
1000 Wilshire Boulevard, Suite 1500
Los Angeles, CA 90017-2457
Tel: (213) 891-0700
Fax: (213) 896-0400
E-mail: sspector@buchalter.com
bharvey@buchalter.com
About Net Data Centers
Net Data Centers, Inc. filed a Chapter 11 bankruptcy petition
(Bankr. C.D. Cal. Case No. 15-12690) on Feb. 23, 2015. Pervez
P. Delawalla, the president & CEO, signed the petition. The
Hon. Sheri Bluebond is assigned to the case. William F Govier,
Esq., at Lesnick Prince & Pappas LLP, serves as counsel to the
Debtor.
The Debtor disclosed, in an amended schedules, $9,566,908 in assets
and $13,352,373 in liabilities. In its original schedules, the
Debtor disclosed $9,110,070 in assets and $5,236,687 in
liabilities.
The U.S. trustee appointed three creditors to serve on the
Official Committee Of Unsecured Creditors. The Committee is
represented by Buchalter Nemer, APC.
NET DATA: Lesnick Prince Okayed as General Bankruptcy Counsel
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
authorized Net Data Centers Inc., to employ Lesnick Prince & Pappas
LLP as general bankruptcy counsel, nunc pro tunc to March 11,
2015.
The Debtor, in its reply to the limited objection of Peter C.
Anderson, U.S. Trustee for Region 16, explained that the
application stated that on Feb. 20, 2015, LPP received a retainer
by wire transfer from the Debtor in the amount of $100,000, which
it deposited into its trust account. As of the Petition Date,
$64,780 of the amount remained on deposit in its trust account as a
retainer for services to be provided and expenses to be incurred in
connection with the Chapter 11 case. LPP expended $35,219 between
Feb. 16 and the Petition Date. On March 11, 2015, LPP provided the
Debtor and its replacement counsel, Paul Beck, with a statement of
LPP's postpetition fees and expenses in the total amount of
$44,577, subject to Court approval. LPP then transferred the
remaining balance of the Retainer to Beck.
The Debtor asked the Court overrule the objection and permit LPP to
continue to hold the retainer balance pending approval of LPP's
postpetition fees and expenses after submission of a fee
application.
The U.S. Trustee, in his limited objection, stated that Lesnick
received a $100,00 prepetition retainer. Lesnick was not clear
whether those amounts were transferred from the trust account to
its general account prepetition. The U.S. Trustee required a
declaration that the entire $64,780 has been turned over to
successor counsel.
The firm can be reached at:
Matthew A. Lesnick, Esq.
Christopher E. Prince, Esq.
William F. Govier, Esq.
LESNICK PRINCE & PAPPAS LLP
185 Pier Avenue, Suite 103
Santa Monica, CA 90405
Tel: (310) 396-0964
Fax: (310) 396-0963
E-mail: matt@lesnickprince.com
cprince@lesnickprince.com
wgovier@lesnickprince.com
About Net Data Centers
Net Data Centers, Inc. filed a Chapter 11 bankruptcy petition
(Bankr. C.D. Cal. Case No. 15-12690) on Feb. 23, 2015. Pervez
P. Delawalla, the president & CEO, signed the petition. The
Hon. Sheri Bluebond is assigned to the case. William F. Govier,
Esq., at Lesnick Prince & Pappas LLP, serves as counsel to the
Debtor.
The Debtor disclosed, in an amended schedules, $9,566,908 in assets
and $13,352,373 in liabilities. In its original schedules, the
Debtor disclosed $9,110,070 in assets and $5,236,687 in
liabilities.
The U.S. trustee appointed three creditors to serve on the
Official Committee Of Unsecured Creditors. The Committee is
represented by Buchalter Nemer, APC.
The Court established June 30, 2015, as the deadline for any
individual or entity to file proofs of claim against the Debtor.
NY PORT AUTHORITY: Moody's Corrects Rating Histories on 2 Bonds
---------------------------------------------------------------
Moody's has corrected the rating histories on two industrial
revenue bonds issued by Port Authority of New York and New Jersey
and backed by United Airlines, Inc. Due to an internal
administrative error, certain rating actions were taken on the 9%
bonds due December 1, 2010 (CUSIP 73358EAC8) instead of the 9.125%
bonds due December 1, 2015 (CUSIP 73358EAA2), which were withdrawn
in error on December 1, 2010. The correct rating history since
December 1, 2010 for the 9.125% bonds due December 1, 2015 is as
follows:
June 15, 2015 B1 Upgrade
February 24, 2015 B3 Affirmation
December 23, 2014 B3 Downgrade
October 14, 2014 B2 Affirmation
December 5, 2013 B2 Upgrade
August 12, 2013 B3 On Review for Upgrade
April 10, 2013 B3 Downgrade
April 4, 2013 B2 Upgrade
March 13, 2013 B3 Affirmation
The rating on the 9% bonds due December 1, 2010 has been withdrawn
as of December 1, 2010.
OSI RESTAURANT: Moody's Raises CFR to Ba2, Outlook Stable
---------------------------------------------------------
Moody's Investors Service upgraded OSI Restaurant Partners, LLC's
Corporate Family Rating to Ba2 from B1, Probability of default
rating to Ba3-PD from B2-PD and senior secured bank ratings to Ba1
from Ba3. Moody's also affirmed OSI's SGL-1 Speculative Grade
Liquidity Rating. The rating outlook is stable. This concludes
Moody's review that was initiated on June 16, 2015.
RATINGS RATIONALE
"The upgrade reflects OSI's materially stronger debt protection
metrics driven in part by the steady improvement in operating
performance, lower funded debt levels and lower interest costs in
addition to the reduction in adjusted debt levels due to changes in
Moody's approach for capitalizing operating leases", stated Moody's
Senior Credit Officer Bill Fahy. As of the LTM period ending March
29, 2015, leverage declined to around 3.6 times from about 4.8
times for the same prior year period, of which just over half of
the improvement was driven by the change in the lease multiple.
The updated approach for standard adjustments for operating leases
is explained in the cross-sector rating methodology Financial
Statement Adjustments in the Analysis of Non-Financial
Corporations, published on June 15, 2015.
Ratings upgraded are:
-- Corporate Family Rating to Ba2 from B1
-- Probability of Default Rating to Ba3-PD from B2-PD
-- $300 million senior secured term loan A due 2019, to Ba1
(LGD2) from Ba3 (LGD2)
-- $825 million senior secured revolver due 2019, to Ba1 (LGD2)
from Ba3 (LGD2)
Ratings affirmed are:
-- Speculative Grade Liquidity rating affirmed at SGL-1
The Ba2 Corporate Family Rating reflects OSI's improved credit
metrics, high level of brand awareness, large and diversified asset
base, positive operating trends and very good liquidity. However,
the ratings also incorporate OSI's below average operating margins
despite significant cost reductions to date, challenges in some
international markets and with certain domestic concepts as well as
soft consumer spending and competitive pressures that will continue
to pressure earnings.
The stable outlook reflects Moody's expectation that OSI will
continue to strengthen debt protection metrics through same store
sales growth, particularly traffic, system-wide unit expansion, and
debt reduction in excess of mandatory amortization. The outlook
also incorporates Moody's view that the company will maintain very
good liquidity and a balanced financial policy towards dividends
and share repurchases.
Ratings could be upgraded in the event a continued improvement in
operating performance results in a sustained strengthening of debt
protection metrics and liquidity. Specifically, ratings could be
upgraded if leverage fell towards 3.25 times, EBITA coverage of
interest expense exceeded 3.5 times, and retained cash flow to debt
was about 25% on a sustained basis. An upgrade would also require
that OSI maintain very good liquidity.
Ratings could be downgraded in the event a protracted deterioration
in operating performance resulted in a sustained deterioration in
credit metrics or liquidity. Specifically, a downgrade could occur
if debt to EBITDA migrated towards 4.5 times or if EBITA to
interest fell towards 2.5 times on a sustained basis. A material
deterioration in liquidity for any reason or the adoption of a more
aggressive financial policy towards dividends and share repurchases
could also result in a downgrade.
OSI Restaurant Partners, LLC owns and operates a diversified base
of casual dining concepts which include Outback Steakhouse,
Carrabba's Italian Grill, Bonefish Grill, Fleming's Prime
Steakhouse and Wine Bar. Annual revenues for the LTM period ended
March 29, 2015, were approximately $4.4 billion.
The principal methodology used in these ratings was Global
Restaurant Methodology published in June 2011. Other methodologies
used include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.
PATRIOT COAL: Spilman Thomas Files Rule 2019 Statement
------------------------------------------------------
Virginia-based law firm Spilman Thomas & Battle PLLC filed a
statement disclosing that it serves as counsel to these creditors
in the Chapter 11 cases of Patriot Coal Corp. and its affiliated
debtors:
(1) Daniels Electric, Inc.
P. O. Box 3426
Charleston, WV 25311
(2) Penn Virginia Operating Co., LLC
Three Radnor Corporate Center, Suite 300
Radnor, PA 19087
(3) Suncrest Resources, LLC
Three Radnor Corporate Center, Suite 301
Radnor, PA 19087
(4) Loadout, LLC
Three Radnor Corporate Center
Radnor, PA 19087
(5) K Rail, LLC
Three Radnor Corporate Center, Suite 301
Radnor, PA 19087
(6) Kanawha Rail, LLC
Three Radnor Corporate Center, Suite 301
Radnor, PA 19087
(7) Toney Fork, LLC
Three Radnor Corporate Center, Suite 301
Radnor, PA 19087
(8) Powell Construction Company, Inc.
3622 Bristol Highway,
Johnson City, TN 37601
Spilman represented Penn Virginia prior to the filing of the
Debtors' cases. Loadout, K Rail, Kanawha Rail, Suncrest Resources
and Toney Fork are wholly owned subsidiaries of Penn Virginia.
The firm continues to represent certain employees of the Debtors in
actions filed pursuant section 110 of the Federal Mine Safety &
Health Act of 1977. In those actions, the Debtors are represented
by other counsel and Spilman solely represents the individual
employees.
Spilman filed the statement pursuant to Rule 2019 of the Federal
Rules of Bankruptcy Procedure.
About Patriot Coal
Patriot Coal Corporation is a producer and marketer of coal in the
United States. Patriot and its subsidiaries control 1.4 billion
tons of proven and probable coal reserves -- including owned and
leased assets in the Central Appalachia basin (in West Virginia
and Ohio) and Southern Illinois basin (in Kentucky and Illinois)
and their operations consist of eight active mining complexes in
West Virginia.
Patriot Coal first sought Chapter 11 protection on July 9, 2012,
and, on Dec. 18, 2013, won approval of its bankruptcy-exit plan
from the U.S. Bankruptcy Court for the Eastern District of
Missouri. The plan turned over most of the ownership of the
company to bondholders that include New York hedge fund Knighthead
Capital Management LLC. The linchpins of the plan were a global
settlement among the Debtors, the United Mine Workers of America,
and two third parties -- Peabody Energy Corporation and Arch Coal,
Inc. -- and a commitment by a consortium of creditors, led by
Knighthead, to backstop two rights offerings that funded the plan.
Patriot Coal Corporation and its subsidiaries commenced new
Chapter 11 cases (Bankr. E.D. Va. Lead Case No. 15-32450) in
Richmond, Virginia, on May 12, 2015. The cases are assigned to
Judge Keith L. Phillips.
The Debtors tapped Kirkland & Ellis LLP as counsel; Kutak Rock
L.L.P., as co-counsel; Centerview Partners LLC as investment
bankers; Alvarez & Marsal North America, LLC, as restructuring
advisors; and Prime Clerk LLC, as claims and administrative agent.
The U.S. trustee overseeing the Chapter 11 case of Patriot Coal
Corp. appointed seven creditors of the company to serve on the
official committee of unsecured creditors.
Patriot Coal estimated more than $1 billion in assets and debt.
PATRIOT COAL: Stites & Harbison Files Rule 2019 Statement
---------------------------------------------------------
Michael Kim, Esq., at Stites & Harbison PLLC, in Alexandria,
Virginia, disclosed that his firm represents these companies in the
Chapter 11 cases of Patriot Coal Corp. and its affiliated debtors:
(a) Travelers Casualty & Surety Company of America
Attn: Ms. Laura M. Murphy
Bond Claim 0000-S102
One Tower Square
Hartford, CT 06183-9062
Phone: (860) 277-0328
Fax: (860) 277-2289
E-mail: LMMURPHY@travelers.com
(b) Westchester Fire Insurance Company
Melissa M. Detrick
ACE North American Claims,
PO Box 5108
Scranton PA, 18505-0525
Phone: 215-640-4258
Fax: 866-635-5687
E-mail: melissa.detrick@acegroup.com
(c) U.S. Specialty Insurance Company
Frank M. Lanak
Executive Vice President, Bond Claims
HCC Surety Group
601 S. Figueroa St., Suite 1600
Los Angeles, CA 90017
Phone: 310-242-4403
E-mail: FLanak@hccsurety.com
(d) Indemnity National Insurance Company
Attn: Mr. Tracy Tucker
c/o Willis of Tennessee, Inc.
6322 Deane Hill Dr.
Knoxville, TN 37919
Stites & Harbison represents the companies in their capacity as
sureties to which certain of the Debtors have obligations,
according to Mr. Kim.
The companies have issued reclamation or other surety bonds to
secure the Debtors' obligations, and hold collateral and
contracts of indemnity to reimburse them in the event they suffer
losses due to the Debtors' failure to perform their bonded
obligations, Mr. Kim also said in a statement he filed in court
pursuant to Rule 2019 of the Federal Rules of Bankruptcy
Procedure.
About Patriot Coal
Patriot Coal Corporation is a producer and marketer of coal in the
United States. Patriot and its subsidiaries control 1.4 billion
tons of proven and probable coal reserves -- including owned and
leased assets in the Central Appalachia basin (in West Virginia
and Ohio) and Southern Illinois basin (in Kentucky and Illinois)
and their operations consist of eight active mining complexes in
West Virginia.
Patriot Coal first sought Chapter 11 protection on July 9, 2012,
and, on Dec. 18, 2013, won approval of its bankruptcy-exit plan
from the U.S. Bankruptcy Court for the Eastern District of
Missouri. The plan turned over most of the ownership of the
company to bondholders that include New York hedge fund Knighthead
Capital Management LLC. The linchpins of the plan were a global
settlement among the Debtors, the United Mine Workers of America,
and two third parties -- Peabody Energy Corporation and Arch Coal,
Inc. -- and a commitment by a consortium of creditors, led by
Knighthead, to backstop two rights offerings that funded the plan.
Patriot Coal Corporation and its subsidiaries commenced new
Chapter 11 cases (Bankr. E.D. Va. Lead Case No. 15-32450) in
Richmond, Virginia, on May 12, 2015. The cases are assigned to
Judge Keith L. Phillips.
The Debtors tapped Kirkland & Ellis LLP as counsel; Kutak Rock
L.L.P., as co-counsel; Centerview Partners LLC as investment
bankers; Alvarez & Marsal North America, LLC, as restructuring
advisors; and Prime Clerk LLC, as claims and administrative agent.
The U.S. trustee overseeing the Chapter 11 case of Patriot Coal
Corp. appointed seven creditors of the company to serve on the
official committee of unsecured creditors.
Patriot Coal estimated more than $1 billion in assets and debt.
PATRIOT COAL: Whiteford Taylor Files Rule 2019 Statement
--------------------------------------------------------
Virginia-based law firm Whiteford, Taylor & Preston LLP filed a
statement disclosing that it serves as counsel to these creditors
in the Chapter 11 cases of Patriot Coal Corp. and its affiliated
debtors:
(1) H.A. Robson Trust
Attn: Thomas W. Petit, David H.
Daugherty and Edwin N. Vinson, Trustees
Post Office Box 53
Huntington, WV 25706
(2) PRC Holdings, LLC
Attn: Will Carter
3590 Benedict Road
Culloden, WV 25510
(3) Prichard School, LLC
Attn: City National Bank of West Virginia
1900 Third Avenue
Huntington, WV 25703
(4) City National Bank of West Virginia,
Trustee under a Trust Agreement dated
December 30, 1983 with A.M. Prichard,
III, Sarah Ann Prichard and Lewis Prichard
and their respective spouses
1900 Third Avenue
Huntington, WV 25703
(5) Robert B. LaFollette Holdings, LLC
Attn: William M. Herlihy, Esquire
Spilman, Thomas and Battle PLLC
Post Office Box 273
Charleston, WV 25321-0273
(6) Wright Holdings, LLC
Attn: Christopher J. Winton
109 Capital Street, Suite 700
Charleston, WV 25301
(7) Kanawha Boone Holdings LLC
Attn: William M. Herlihy, Esquire
Spilman, Thomas and Battle PLLC
Post Office Box 273
Charleston, WV 25321-0273
(8) James A. LaFollette Holdings, LLC
Attn: William M. Herlihy, Esquire
Spilman, Thomas and Battle PLLC
Post Office Box 273
Charleston, WV 25321-0273
(9) LML Properties, LLC
Attn: Dearmond L. Arbogast
Post Office Box 2068
Charleston, WV 25327
(10) Riverside Park, Inc.
Attn: L.M. LaFollette
Post Office Box 2068
Charleston, WV 25327
Each of the creditors may hold claims against the Debtors arising
out of certain agreements, Whiteford said in a statement it filed
in court pursuant to Rule 2019 of the Federal Rules of Bankruptcy
Procedure.
PINNACLE ENTERTAINMENT: Fitch Puts B+ IDR on Positive Watch
-----------------------------------------------------------
Fitch Ratings has placed Pinnacle Entertainment Inc.'s (PNK) 'B+'
Issuer Default Rating (IDR) on Rating Watch Positive and PNK's
issue ratings on Rating Watch Evolving following PNK's announcement
that it will be acquired by Gaming and Leisure Properties, Inc.
(GLPI), which will assume $2.7 billion of PNK's debt.
The Rating Watch reflects Fitch's view of GLPI's credit profile,
which is seen by Fitch as stronger than PNK's current credit
profile. GLPI plans to have a 5.5x debt/EBITDA ratio pro forma for
the purchase and will benefit from having master leases with two
large and diversified operating companies. GLPI has in place
committed financing and plans to refinance PNK's debt when
transactions close.
KEY RATING DRIVERS
The Rating Watch Evolving on PNK's debt instruments reflects the
uncertainty regarding which instruments (if any) will be allocated
to PropCo vs. the newly formed OpCo, the PropCo's and OpCo's pro
forma capital structures and the timing of the refinancings of
PNK's debt. (Public disclosure is not clear if the OpCo will assume
the debt first before refinancing its share of debt at PNK.)
However, the covenants of the PNK's existing debt instruments
prohibit asset transfers unless PNK uses proceeds to repay its
debt. Therefore, Fitch thinks it is likely that the OpCo's portion
of PNK's debt will be refinanced at PNK prior to or concurrently
with the OpCo/PropCo split.
PNK's OpCo will refinance the remaining $1 billion of debt at PNK
with its own committed financing. Fitch views PNK's planned OpCo
more negative relative to PNK's existing credit profile. Fitch
estimates the OpCo's pro forma rent adjusted leverage (using
8-times multiple for rent adjustment) and run-rate FCF to EBITDAR
based on company guidance at 6.2x and 16%, respectively. This
compares to approximately 5.6x and 44%, respectively, absent the
announced transactions. Fitch believes that with lower FCF/EBITDAR
ratio, the OpCo's FCF will have a higher sensitivity to any
potential operating pressures. That said Fitch will likely view
OpCo's credit profile as being consistent with a 'B' category IDR.
As proposed PNK will spin-off its operations into a newly created
OpCo, which will lease the assets from the legacy PNK (PropCo).
GLPI will then purchase PNK's PropCo with PNK shareholders
receiving stock in GLPI. PNK's shareholders will end up owning 100%
of the new OpCo and approximately 27% of GLPI. Pro forma for
transactions, the OpCo's EBITDAR after corporate expense will cover
the rent to GLPI at 1.7x and Pinnacle's guidance for run-rate FCF
is $101 million.
KEY ASSUMPTIONS
Fitch relied on GLPI's and PNK's guidance. Notable assumptions
include:
-- Initial rent of $377 million;
-- Pro forma non-adjusted leverage at OpCo and GLPI of 3.5x and
5.5x, respectively;
-- OpCo's pro forma EBITDAR and FCF of $635 million and $101
million.
RATING SENSITIVITIES
Should the transactions close as planned Fitch will withdraw
ratings on PNK. However, in event the debt instruments are
allocated to the PropCo and/or OpCo and remain at these respective
entities (i.e. not refinanced), Fitch would likely view the PNK
legacy debt at the OpCo less favorably than the same debt at the
PropCo. Should the transaction not go through Fitch would take the
Rating Watch Positive off from PNK's IDR. Prior to the GLPI asset
sale announcement Fitch had PNK's IDR on Negative Rating Outlook,
which took into account PNK's plan to spin-off its assets into a
stand-alone REIT.
FULL LIST OF RATING ACTIONS
Pinnacle Entertainment Inc
-- IDR 'B+' placed on Rating Watch Positive;
-- Senior secured credit facility 'BB+/RR1'
placed on Rating Watch Evolving;
-- Senior unsecured notes 'BB-/RR3' placed on Rating
Watch Evolving;
-- Subordinated notes 'B-/RR6' placed on Rating Watch
Evolving.
SANUWAVE HEALTH: Chief Financial Officer Barry Jenkins Quits
------------------------------------------------------------
SANUWAVE Health, Inc. announced that Barry Jenkins, chief financial
officer, has resigned from the Company to accept a top management
position at a leading medical services company. To ensure a smooth
transition, Mr. Jenkins will remain with the Company through July
31, 2015. Lisa Sundstrom, the Company's controller since October
2006, will assume the additional duties of interim chief financial
officer.
"On behalf of SANUWAVE's management and Board, we thank Barry for
his contributions, congratulate him on this new opportunity and
wish him well in his next endeavor," stated Kevin A. Richardson II,
SANUWAVE's chairman of the board. "Due to the strength of the
finance organization he helped build, we expect a seamless
transition. Lisa has been involved in all aspects of the Company's
financial organization for many years and I look forward to
continuing to work with her to pursue our strategic initiatives and
growth strategies slated for 2015 and beyond."
Ms. Sundstrom has over 23 years of financial and accounting
experience, including the last nine years with SANUWAVE. Her
previous positions include senior financial and accounting roles at
ADP and Mitsubishi Consumer Electronics.
About SANUWAVE Health
Alpharetta, Ga.-based SANUWAVE Health, Inc., is an emerging global
regenerative medicine company focused on the development and
commercialization of noninvasive, biological response activating
devices for the repair and regeneration of tissue, musculoskeletal
and vascular structures.
SANUWAVE Health reported a net loss of $5.97 million on $847,000 of
revenues for the year ended Dec. 31, 2014, compared with a net loss
of $11.3 million on $800,000 of revenues in 2013.
As of March 31, 2015, the Company had $3.49 million in total
assets, $6.18 million in total liabilities, and a $2.69 million
total stockholders' deficit.
SPIRIT AIRLINES: Fitch Publishes 'BB+' Issuer Default Rating
------------------------------------------------------------
Fitch Ratings has made public an Issuer Default Rating (IDR) of
'BB+' for Spirit Airlines. The Rating Outlook is Stable.
KEY RATING DRIVERS
The rating is supported by Spirit's industry-leading operating
margins, healthy liquidity, low cost structure, and modest
leverage. Fitch believes that Spirit's cost advantage over its
peers gives the company significant cushion to operate through
potential future economic downturns while maintaining adequate
financial health. The ratings are also supported by Spirit's track
record of successful growth achieved in the years since the
previous recession, which partly offsets our concerns about the
company's plans for future growth. Spirit has doubled its total
capacity since 2010 while improving both its yield and average load
factor. Fitch notes that Spirit's profitability has been a standout
in the airline industry. The company's 30%+ EBITDAR margins put
have put it among the most profitable airlines worldwide for the
past four years.
Fitch's primary concerns center on the company's aggressive plans
for growth. Spirit expects to increase its capacity as measured by
available seat miles (ASMs) by 15%-20% annually for the foreseeable
future, including 30%+ growth in 2015. Correspondingly, its order
book for new aircraft is large, consisting of 101 A320 family
aircraft as of March 31, 2015. Heavy upcoming deliveries will
require significant capital investment, and as a result Fitch
expects free cash flow (FCF) to remain negative for the next
several years. Capacity expansion may also pressure unit revenues.
As seen in the first half of this year, heavy growth has
contributed to Spirit's declining RASM numbers. Unit revenue may
continue to feel some pressure as Spirit enters new markets and
increasingly competes with larger carriers.
Additionally, if Spirit is unable to successfully manage its
growth, it has the possibility of being left with too many aircraft
and not enough profitable routes on which to operate them. This
risk is partially mitigated by Spirit's track record over the past
five years and by the relatively low penetration of ultra-low cost
carriers (ULCCs) in the U.S. compared to other markets around the
globe.
Other concerns are typical of the airline industry and include
Spirit's unionized workforce, high degree of operating leverage,
exposure to fluctuating fuel prices, and exogenous shocks that
could cause demand for travel to drop quickly. Spirit also operates
in a highly competitive industry, which includes stronger legacy
carriers than in the past, and growing low-cost competitors such as
Allegiant and Frontier. Start-up competition is also a longer term
possibility, particularly given the high profits that the ULCC
business model generated in recent years.
Low Cost Structure: Fitch considers Spirit's ultra-low cost
structure to be a key competitive advantage and supporting credit
factor for the airline. For full-year 2014, Spirit reported a cost
per ASM excluding fuel of 5.61 cents, which is well below any of
its larger competitors. Low costs are driven by high aircraft
utilization rates, operating a single fleet type, high-density
seating configurations, outsourcing certain labor functions, and
maintaining a simple point-to-point route network. Spirit has no
pension obligations, a key cost differentiator between some
competing airlines. Importantly, Fitch expects unit costs to
decline in the mid-single digits this year and to hold roughly flat
in the intermediate term, whereas many other airlines in the U.S.
are expected to experience at least moderately rising unit costs,
meaning that Spirit's cost advantage should widen.
Fitch also believes that Spirit's low cost structure and
corresponding low ticket prices, should help it to perform in
future economic downturns. Spirit's low unit costs and high
operating margins mean that it can maintain its low ticket prices
and potentially attract traffic away from the legacy carriers in a
downturn as travel budgets tighten. Alternatively, Spirit has the
flexibility to drop fares to stimulate traffic while still
generating an adequate return. Fitch also notes that Spirit
performed well compared to its peers during the 2008/2009
recession, generating a modest net profit in both years despite
high fuel prices and a severe economic downturn. Spirit's business
model has evolved since that time, and its margins and financial
flexibility are better, supporting Fitch's view that the company
could operate through a downturn without a material impact to its
credit profile.
Focus on Ancillary Revenue: Non-ticket revenues are a key component
of Spirit's business model. Spirit has become the market leader in
this area, with a full 40% of its revenue coming from non-ticket
items. This strategy is important because it allows Spirit to keep
its base fares low, which tends to attract the leisure travelers
that make up its target market. Its low fares also cause Spirit's
flights to show up at the top of search results on the on-line
travel agency websites. Non-ticket charges also help to keep
Spirit's cost structure low. For instance, carry-on bag fees
discourage passengers from packing heavily, helping to keep planes
lighter and more fuel efficient. Fewer carry-on bags also lead to
faster turnaround times. Charging to print boarding passes at the
airport and making calls to Spirit's call center help to keep labor
costs low.
Recent Unit Revenue Weakness: Spirit's reduced revenue and profit
expectations for 2015 are not a credit concern at this time as the
company is still poised to generate record results this year.
Fitch's forecast for 2015 anticipates an EBIT margin of 22% for the
year, up 340 basis points from 2014. Because this year's revenue
decline has been at least partially caused by one-time events
including the dramatic drop-off in crude oil and expanded
competition in Dallas, Fitch does not expect the magnitude of
revenue weakness to persist over the longer term. Spirit's RASM
declined by 9.9% through the first quarter of the year. The company
issued revised guidance in July, lowering its forecasted operating
margin for the year to 21.5%-23% compared to guidance at the
beginning of the year of 24%-29%.
Mixed Credit Metrics: Spirit currently operates with little debt on
its balance sheet. Fitch calculates Spirit's total adjusted
debt/EBITDAR, which accounts for operating leases, at 3.3x as of
March 31, 2015, which is at the low end of most its North American
peers. Fitch expects total adjusted leverage to remain roughly flat
over the intermediate term as debt incurred to finance aircraft
should be partially or wholly offset by growing EBITDA. Funds from
operations (FFO) adjusted leverage is high for the rating at 4.1x.
While Spirit's leverage is moderate, its coverage metrics are weak
compared to some peers because of the company's heavy use of
operating leases. FFO/Fixed charge coverage as of March 31, 2015
was 2.1x, which is weak for the recommended rating. Fitch expects
coverage metrics to improve over the next several years due to the
benefits of owning some aircraft versus having 100% operating
leases. Spirit is also able to negotiate lower aircraft lease rates
as it grows in size and as its credit profile improves.
Solid Financial Flexibility: As of March 31, 2015, Spirit had a
cash and equivalents balance of $742 million, equal to 37.3% of LTM
revenue, which is higher than most of its North American peers. The
company also maintains two lines of credit totaling $56.6 million.
The credit lines consist of an $18.6 million line related to
corporate credit cards, and a $38 million line available for both
physical fuel delivery and jet fuel derivatives. As of March 31,
2015, the company had drawn $5.5 million on the former and $8.9
million on the latter. Spirit's financial flexibility is supported
by the absence of near-term debt maturities, and the fact that it
has no pension obligations.
FCF to Be Pressured: Fitch expects Spirit's FCF to remain negative
for the intermediate term as the company increasingly finances
aircraft with debt. Fitch's forecast incorporates negative FCF in
the range of $200 million-$300 million annually. The company
currently leases the majority of its planes and the corresponding
increase in capital spending is expected to push FCF negative for
the foreseeable future. Although negative FCF is a concern, the
company's decision to purchase some aircraft is likely a better
long-term strategic decision, given that the cost of funding for
those aircraft should be cheaper than leasing. Accelerated
depreciation offered by purchasing the aircraft will also have cash
tax benefits, which are expected to boost cash flow from operations
going forward.
Unlike many other U.S. Airlines, Spirit does not intend to return a
material amount of cash to shareholders in the foreseeable future.
The company is focused on growth, and intends to invest heavily in
the business going forward. Spirit initiated a $100 million
repurchase program in 2014, but intends to use it opportunistically
when it feels that the stock price is low and not as a means of
returning significant cash to shareholders. Competitors including
Southwest, Delta, Alaska, American and United have all begun
returning cash to shareholders as their profits have improved.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for Spirit include:
-- Capacity growth of around 30% in 2015 and roughly 20% annually
thereafter;
-- Healthy industry competition and growing capacity leading to
moderate unit revenue declines in 2015 and 2016;
-- An all-in fuel price of around $2.10/gallon in 2015 rising to
the $2.30 range thereafter;
-- Negative FCF in the range of $200 million to $300 million
annually driven mainly by aircraft purchases.
RATING SENSITIVITIES
Factors that could individually or collectively cause Fitch to take
a positive rating action include:
-- Total adjusted debt/equity credit falling below 3x on a
sustained basis (Debt/EBITDAR as of March 31, 2015: 3.3x);
-- FCF trending towards positive;
-- FFO fixed-charge coverage ratio increasing toward 3x.
Factors that could individually or collectively cause Fitch to take
a negative rating action include:
-- Total adjusted debt/EBITDAR rising toward 4x on a sustained
basis;
-- Liquidity as a percentage of LTM revenue falling below 20% on a
sustained basis (as of March 31, 2015: 37%);
-- Material weakness in revenue or a sharp uptick in costs
resulting in EBIT margins sustained below 12% (as of March 31,
2015: 20.6%);
-- Difficulties managing planned capacity growth which cause Fitch
to make material negative revisions to its financial
projections.
Fitch has published the following ratings;
Spirit Airlines, Inc.
-- IDR at 'BB+'.
SPIRIT AIRLINES: S&P Assigns 'BB-' CCR, Outlook Stable
------------------------------------------------------
Standard & Poor's Ratings Services said that it has assigned its
'BB-' corporate credit rating to Miramar, Fla.-based Spirit
Airlines Inc. The outlook is stable.
"Spirit Airlines Inc. is an ultra-low cost, low fare airline," said
Standard & Poor's credit analyst Betsy Snyder.
"As of March 31, 2015, the company operated a fleet of 70 Airbus
A320-family aircraft to 57 destinations in the U.S., the Caribbean,
and Latin America, with a large presence at the Ft. Lauderdale
Airport." Although Spirit has been growing rapidly, the company
has a relatively small position in the U.S. airline industry. It
has a different operating strategy than most other U.S. airlines --
it focuses on leisure travelers, operates its aircraft with
high-density seating, offers very low base fares, and charges fees
for all other services. As a result, it has the largest proportion
of high-margin ancillary revenues in the U.S. airline industry (44%
of revenues in first-quarter 2015). At the same time, the
company's operating performance benefits from its relatively low
labor costs, high density seating, and relatively new and
fuel-efficient aircraft. These factors have helped Spirit maintain
operating margins that are among the highest in the U.S. industry
(25%, adjusted for the 12 months ended March 31, 2015). Similar to
the rest of the industry, the company's operating performance has
benefitted from lower oil prices, which is a trend S&P expects to
continue. S&P assesses Spirit's competitive position as "fair",
but view its overall business risk profile as "weak". The
fundamental characteristics of the airline industry constrain its
overall business risk.
The stable outlook reflects S&P's expectation that Spirit's credit
metrics will remain relatively consistent through 2016, with
increased earnings and cash flow offsetting incremental debt to
finance the purchase of 26 aircraft over that period.
S&P could lower its rating on the company if its earnings and cash
flow are weaker than S&P anticipated because of
higher-than-expected fuel prices or lower-than-expected demand and
pricing, causing its FFO-to-debt ratio to fall to 12% or below on a
sustained basis.
Although considered unlikely, S&P could raise the rating if
Spirit's earnings and cash flow improve because of
lower-than-expected fuel prices or higher-than-expected demand and
pricing, causing the company's FFO-to-debt ratio to increase above
40% on a sustained basis.
SRS LLC: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: SRS, LLC
3760 Sunset Lane
Northbrook, IL 60062
Case No.: 15-24745
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Jack B. Schmetterer
Debtor's Counsel: Timothy C. Culbertson, Esq.
LAW OFFICES OF TIMOTHY C. CULBERTSON
1107 Lincoln Ave.
Fox River Grove, IL 60021
Tel: (847) 913-5945
Fax: (847) 574-8220
Email: tcculb@yahoo.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sohail A. Shakir, managing member.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
A copy of the petition is available at:
http://bankrupt.com/misc/ilnb15-24745.pdf
SULLIVAN INTERNATIONAL: US Trustee to Continue Meeting on Aug. 4
----------------------------------------------------------------
The U.S. trustee overseeing the Chapter 11 case of Sullivan
International Group Inc. will continue the meeting of creditors on
August 4, 2015, at 1:00 p.m., according to a filing with the U.S.
Bankruptcy Court for the Southern District of California.
The meeting will be held at 402 W. Broadway, Emerald Plaza
Building, Suite 660 (B), Hearing Room B, in San Diego, California.
The court overseeing the bankruptcy case of a company schedules the
meeting of creditors usually about 30 days after the bankruptcy
petition is filed. The meeting is called the "341 meeting" after
the section of the Bankruptcy Code that requires it.
A representative of the company is required to appear at the
meeting and answer questions under oath. The meeting is presided
over by the U.S. trustee, the Justice Department's bankruptcy
watchdog.
About Sullivan International
Sullivan International Group, Inc., an environmental engineering
provider, commenced a Chapter 11 bankruptcy case (Bankr. S.D. Cal.
Case No. 15-02281) in San Diego, California, on April 6, 2015.
Steven E. Sullivan signed the petition as chief executive officer.
The Debtor disclosed total assets of $16.27 million and total
Debts of $17.25 million. James P. Hill, Esq., at Sullivan, Hill,
Lewin, Rez & Engel, APLC, in San Diego, represents the Debtor as
counsel.
The U.S. trustee overseeing the Debtor's bankruptcy case appointed
DeNovo Constructors Inc., Tetra Tech Inc., Park Construction Co.,
Energy Solutions, Wittie Letsche & Waldo LLP, Lawson Environmental
Service, Meyer Construction Inc., Cascade Drilling LP, and McMillin
NTC 903/904 LLC to serve on the official committee of unsecured
creditors.
TALEN ENERGY: S&P Puts 'BB-' ICR on CreditWatch Negative
--------------------------------------------------------
Standard & Poor's Ratings Services said it placed its 'BB-' issuer
credit rating on merchant generator Talen Energy Supply LLC on
CreditWatch with negative implications. S&P also placed its
secured and unsecured issue-level ratings of 'BB+' and 'BB-',
respectively, on CreditWatch with negative implications. The
recovery ratings of '1' and '3' on the company's secured and
unsecured debt, respectively, remain unchanged. The '1' recovery
rating on the secured debt indicates S&P's expectation of very high
(90% to 100%) recovery in the event of a default. The '3' recovery
rating on the unsecured debt indicates S&P expectation of
meaningful (50% to 70%; upper end of the range) recovery in the
event of a default.
On July 20, 2015, Talen Energy Supply LLC announced that it was
purchasing MachGen LLC, an approximately 2.5 GW portfolio of three
combined-cycle gas turbine located in the ISO-NE, NYISO, and WECC
power markets. The purchase price has tentatively been listed as
approximately $1.175 billion. While MachGen currently has a term
loan B outstanding, Talen management has suggested that it will use
debt to finance the whole acquisition. If this avenue is chosen,
debt to EBITDA would well exceed 4x during the next few years,
which would likely push the issuer's financial risk profile into
the "aggressive" category.
The CreditWatch placement reflects S&P's belief that this
acquisition, if funded entirely with debt, could considerably
weaken Talen Energy Supply LLC's financial measures. Specifically,
S&P believes that such a financing scheme would result in debt to
EBITDA well exceeding 4x during 2016, which would likely cause S&P
to revise its financial risk profile score.
"We will resolve the CreditWatch listing when we fully understand
the financing plan, as well as how volatile cash flows associated
with this transaction will be," said Standard & Poor's credit
analyst Michael Ferguson. "We will also consider whether or not
the additional scope associated with these assets would make it
more comparable, from a business risk perspective, with larger,
better diversified peers. A downgrade, if one occurs, is not
likely to exceed one notch."
TERRAFORM GLOBAL: Moody's Assigns 'B1' Corp. Family Rating
----------------------------------------------------------
Moody's Investors Service assigned a B1 Corporate Family Rating to
TerraForm Global Operating LLC and a B1-PD Probability of Default
rating (PDR). The rating outlook is stable. At the same time,
Moody's assigned a B2(LGD4) senior unsecured rating to TGO's
planned issuance of a $800 million senior unsecured notes due in
2022. The unsecured debt is rated one notch below the CFR to
reflect TGO's $440 million senior secured revolving credit
facility. As a condition precedent to the financial closing of
these facilities, TGO's parent TerraForm Global Inc (GLBL: not
rated) will become a publicly listed YieldCo, raising approximately
$1.1 billion of equity through an IPO (expected to be completed by
mid-August) and an additional $577.5 million of equity through
private placements. After the equity sales, GLBL's sponsor Sun
Edison Corp. (SUNE; not rated) will retain an approximately 40%
ownership in both GLBL and TGO.
RATINGS RATIONALE
TGO's B1 CFR is underpinned by a diverse set of long term contracts
that provide stable cash flows; have low operating risks and are
comprised predominantly by wind and solar energy projects. TGO has
limited structural subordination (assets with project-level debt
contribute only 21% of CAFD at TGO), and a moderate financial
policy that targets leverage level ratios of 5.0-5.5x on a
consolidated Debt/EBITDA basis. TGO's cash flows draw from 42
different projects spread across 11 countries, chiefly Brazil,
India and China.
"TGO's rating is constrained by the risks normally associated with
the YieldCo business model, such as the dividend growth imperative
and the constant need to access external sources of capital," said
Swami Venkataraman, Vice President -- Senior Credit Officer. "In
addition, TGO gets its cash flows from emerging economies, which
exhibit higher regulatory risks, lower offtaker credit quality
(Moody's estimates that offtakers accounting for about 65% of cash
flows would be rated non-investment grade) and higher currency and
cash repatriation risks."
The B1 rating considers a number of factors that help mitigate
several key risks. First, currency risks are mainly limited to
Brazil, India, China and South Africa, where TGO looks to maintain
a rolling three-year currency hedge on 100% of CAFD. TGO also
structures its equity investments in many of these countries in the
form of shareholder loans, which are associated with lower
withholding tax rates. The company has modeled withholding tax
expense as 3% of parent CAFD. From a credit perspective, Moody's
doubles this rate to 6% in our projections.
GLBL's sponsor Sun Edison (SUNE, unrated) is a leading solar
developer and well positioned to support growth at both GLBL and
its US affiliate TerraForm Power Operating LLC (TERP, Ba3 CFR
Positive). However, SUNE has a weak balance sheet with significant
leverage. Moody's incorporates a view that SUNE's financial
flexibility and market access has improved over the past two years
as the company divested its semiconductor manufacturing business,
completed an IPO of TERP and now GLBL. Moody's observes that SUNE
is also exploring warehousing structures to reduce reliance on its
balance sheet to finance project construction. Moody's sees
certain ring-fence type provisions designed to insulate GLBL from
SUNE, a credit positive. TGO's B1 CFR is a stand-alone credit
analysis, and is not effected by its parent SUNE at this time. The
market conditions are favorable for the growth of renewable energy,
especially solar power, as panel price declines have made solar
competitive with fossil fuels in many countries. But Moody's
continues to reflect some level of risk relating to the unproven
business model of all yieldco's, including TGO, given the high
reliance on financial engineering and current market rates.
Moody's sees YieldCos promising 15-25% dividend growth but their
ability to sustain growth, establish a track record and sustain the
business model operate through difference market conditions and
business cycles remains untested. That said, growth through
acquisitions remains a key component to the business strategy.
SUNE has a substantial pipeline of nearly 6 GW of "call rights"
assets to support growth at GLBL, including about 1 GW of assets
that are currently operational. In addition, SUNE has committed to
provide GLBL with projects worth at least $1.4 billion of CAFD over
five years from the IPO.
Moody's credit analysis primarily focused on consolidated financial
ratios Under a P90 "no growth" scenario, TGO has Debt/EBITDA and
FFO/Debt of 6.1x and 11%, respectively, rising to 4.0x and 15% by
2020 as project level debt is paid down from $1.03 billion at IPO
to $676 million by 2020. However, Moody's analysis assumes that
this improvement in financial ratios will not come about and that
the company will increase leverage to maintain its target financial
profile. Moody's rating is thus predicated on the assumption that
management will maintain its target consolidated leverage of
5.0-5.5x on a Debt/EBITDA basis. Although project level debt is
material, structural subordination is manageable as 79% of cash
flows coming up to TGO are from unlevered projects.
Liquidity
Moody's assigned an SGL-3 speculative grade liquidity rating to
TGO, incorporating our expectations for adequate liquidity for the
next 12 months. Upon financial close of the secured facilities,
TGO is expected to have about $250 million in unrestricted cash on
hand plus access to the $440 million revolver. Solar projects
require little working capital and their maintenance capital
expenditure needs are already incorporated into their respective
O&M agreements with SUNE or third party providers. TGO's main need
for liquidity will arise in the context of acquisitions of new
projects, for which it will utilize its working capital facility,
to be later replaced by equity and debt issuances. TGO may also
need to rely on liquidity to manage timing mismatches in
repatriations from its various markets.
Outlook
The outlook is stable reflecting the offtaker and sovereign credit
quality that are both significantly stronger than TGO's CFR, low
operating risks for solar projects and expectations for stable
operating performance at the various projects.
What Could Change The Rating Up
TGO is expected to maintain a stable financial profile of 5.0-5.5x
Debt/EBITDA as it grows. An upgrade would depend mainly upon a
track record of growth backed up by reliable performance under the
PPAs by counterparties.
What Could Change The Rating Down
Moody's would lower the rating in the event that either higher debt
levels, poorer operating performance, currency/tax risks or pricey
acquisitions that pressure the financial profile. Other factors
that could affect the rating include disruptive policy
developments, or macroeconomic developments in emerging markets
that disrupt cash flows at the projects, a decline in the quality
of cash flows through shorter contracts, commodity price exposure,
lower rated counterparties or risky regulatory jurisdictions.
Deterioration in the credit quality of the sponsor SUNE could be
another factor in a rating downgrade at TGO.
The principal methodology used in these ratings was Unregulated
Utilities and Unregulated Power Companies published in October
2014. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
TMT USA: Su Wants Conversion; Committee to Pursue Claims
--------------------------------------------------------
Hsin Chi Su also known as Nobu Su, and F3 Capital, on one hand, and
TMT Procurement Corporation, et al., on the other, exchanged court
filings in connection with Mr. Su's motion to convert TMT's cases
to Chapter 7 liquidation and a bid by the Debtors to let the
Committee pursue certain claims.
Edward L. Rothberg, Esq., at Hoover Slovacek LLP, counsel to Mr.
Su, avers, "Mr. Su has met the two prong test for cause cited under
11 U.S.C. Sec. 1112 (b)(4)(A), which states that “cause”
includes substantial or continuing loss to or diminution of the
estate and the absence of a reasonable likelihood of
rehabilitation. The astounding professional fees, over
$22 million within two years, satisfy the “substantial or
continuing loss to or diminution of the estate” element.
Regarding reasonable likelihood of rehabilitation, the current
Plans on file at document nos. 2374 and 2375 are not plans of
rehabilitation. The Debtors have sold all their assets and have no
employees. The majority of the Debtors have substantial losses
reflected in the
monthly operating reports. Therefore, no reasonable likelihood of
rehabilitation exists."
The Debtors are opposing the Motion to Convert and has moved to
grant the Official Committee of Unsecured Creditors standing to
commence certain estate claims.
The Debtors objected to the Mr. Su's motion, stating that the
motion must be denied because he cannot meet his burden to prove
that there is a substantial or continuing loss to or diminution of
the estate. The Debtors note that Mr. Su's remaining allegations
focus on the non-consummation of the Handies plan -- these
allegations also fail, both as a matter of estoppel and, in any
event, countervailing unusual circumstances.
As to the proposal to grant standing to the Committee, on June 2,
2015, the Committee filed a stipulation seeking standing to pursue
any and all avoidance actions for the estate. The Court set a
hearing on the Stipulation for June 18, 2015. The Court stated
that the Stipulation would be treated as a motion for
adoption of the Stipulation. The Court also entered an interim
Order on the Motion to Convert appointing an examiner to determine
if the “Estate causes of action have been preserved for timely
prosecution, and report to the Court at June 19, 2015.” The
Committee and Debtors have indicated in the Notice of Avoidance
Actions [ECF 2500] that they no longer desire approval of the
Stipulation. Instead, the Debtors indicate that they will pursue
claims against certain lenders and the Committee will pursue claims
against certain insiders.
Mr. Su claims, among other things, that the Debtors have not
addressed the fact that a Committee member, Hyundai Samho, has a
direct conflict with pursuing avoidance actions against some of the
nondebtor affiliates because it has a direct claim it is pursuing
against the very same party that the Committee would be trying to
collect against. According to Mr. Su, while it appears some of the
potential defendants have no assets, the Committee and its
Committee member would be seeking to collect against the same
turnip.
Copies of the documents are available for free at:
http://is.gd/hEKoJJ
http://is.gd/7WZ7Ng
http://is.gd/QT3c6S
http://is.gd/lOfptf
http://is.gd/p5830z
http://is.gd/fEfEi3
The Debtors are represented by:
Jason G. Cohen, Esq.
BRACEWELL & GIULIANI LLP
711 Louisiana, Suite 2300
Houston, TX 77002
Tel: (713) 223-2300
Fax: (713) 221-1212
E-mail: Jason.Cohen@bgllp.com
Evan Flaschen, Esq.
CityPlace I, 34th Floor
185 Asylum Street
Hartford, CT 06103
Tel: (860) 947-9000
Fax: (800) 404-3970
E-mail: Evan.Flaschen@bgllp.com
Mr. Su is represented by:
Edward L. Rothberg, Esq.
Deirdre Carey Brown, Esq.
HOOVER SLOVACEK LLP
Galleria Tower II
5051 Westheimer, Suite 1200
Houston, TX 77056
Tel: (713) 977-8686
Fax: 713-977-5395
E-mail: Rothberg@hooverslovacek.com
Brown@hooverslovacek.com
About TMT Group
Known in the industry as TMT Group, TMT USA Shipmanagement LLC and
its affiliates own 17 vessels. Vessels range in size from 27,000
dead weight tons (dwt) to 320,000 dwt.
TMT USA and 22 affiliates, including C. Ladybug Corporation,
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No.
13-33740) in Houston, Texas, on June 20, 2013 after lenders seized
seven vessels.
TMT filed a lawsuit in U.S. bankruptcy court aimed at forcing
creditors to release the vessels so they can return to generating
income.
TMT has tapped attorneys from Bracewell & Giuliani LLP as
bankruptcy counsel and AlixPartners as financial advisors.
On a consolidated basis, the Debtors have $1.52 billion in assets
and $1.46 billion in liabilities.
The U.S. Trustee for Region 7, appointed Elizabeth M. Guffy as
examiner in the Chapter 11 cases of TMT USA Management LLC
and its debtor affiliates, following a directive from Judge Marvin
Isgur of the U.S. Bankruptcy Court for the Southern District of
Texas, Houston Division.
TWENTYEIGHTY INC: S&P Lowers CCR to 'B-' & Puts on Watch Negative
-----------------------------------------------------------------
Standard & Poor's Rating Services said that it lowered its
corporate credit rating on Broomfield, Colo.-based TwentyEighty
Inc. (formerly known as Miller Heiman Inc.) to 'B-' from 'B'. At
the same time, S&P placed the ratings on CreditWatch with negative
implications.
S&P also lowered its issue-level rating on the company's $399
million senior secured credit facility due 2019 to 'B-' from 'B'.
The '3' recovery rating remains unchanged, indicating S&P's
expectation for meaningful recovery (50%-70%; lower half of the
range) of principal in the event of a payment default.
"The downgrade reflects the company's weaker-than-expected
operating performance, aggressive acquisition strategy,
slower-than-expected pace of integrating and reducing costs related
to its IPI and VitalSmarts acquisitions, and tight covenant cushion
with respect to its maximum senior net leverage covenant," said
Standard & Poor's credit analyst Heidi Zhang.
"The CreditWatch placement reflects the possibility of a one-notch
downgrade if TwentyEighty's liquidity profile does not improve
within the next two months," said Ms. Zhang. S&P believes that
TwentyEighty's margin of compliance with its maintenance financial
covenant could remain below 15% over the next several quarters due
to scheduled covenant step-downs. S&P expects the company to have
a less than 5% covenant cushion in the second quarter of 2015. Even
though S&P expects the covenant cushion to expand in the later half
the year mainly due to seasonality effects, it expects the covenant
cushion to remain below 15% over the next 12 months. As a result,
S&P has revised its liquidity assessment on the company to "less
than adequate" from "adequate."
Alternatively, S&P could affirm the 'B-' rating if it believes the
company will sustain a covenant cushion of at least 10% over the
next 12-24 months. S&P will resolve the CreditWatch placement upon
meeting with the management team and reviewing the company's
covenant relief efforts and near-term performance.
WAVE SYSTEMS: Receives NASDAQ Notice of Non-Compliance
------------------------------------------------------
Wave Systems Corp. announced that the Listing Qualifications Staff
of The NASDAQ Stock Market LLC has provided notice to the Company
that, based upon the Company's continued non-compliance with the
minimum $1.00 bid price requirement, as set forth in NASDAQ Listing
Rule 5550(a)(2), as of July 14, 2015, the Company's common shares
would be subject to delisting from NASDAQ effective
July 27, 2015, unless the Company timely requests a hearing before
the NASDAQ Listing Qualifications Panel.
The Company is considering its options with respect to a plan to
regain and sustain compliance with the applicable NASDAQ listing
criteria and the presentation of such plan at a hearing before the
Panel. The Company's common shares will remain listed on NASDAQ
pending any such hearing and the expiration of any extension
granted by the Panel following the hearing. There can be no
assurance that the Panel would grant the Company's request for
continued listing on NASDAQ.
About Wave Systems
Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) --
http://www.wave.com/-- develops, produces and markets products for
hardware-based digital security, including security applications
and services that are complementary to and work with the
specifications of the Trusted Computing Group, an industry
standards organization comprised of computer and device
manufacturers, software vendors and other computing products
manufacturers.
Wave Systems reported a net loss of $12.9 million in 2014, a net
loss of $20.3 million in 2013 and a net loss of $34 million in
2012.
As of March 31, 2014, the Company had $8.74 million in total
assets, $17.1 million in total liabilities and a $8.37 million
total stockholders' deficit.
KPMG LLP, in Hartford, Connecticut, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2014. The independent auditors noted that
Wave Systems Corp. has suffered recurring losses from operations
and has a net capital deficiency that raise substantial doubt about
its ability to continue as a going concern.
WHITE MARINE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: White Marine, Inc.
PO Box 751
Perth Amboy, NJ 08862
Case No.: 15-23627
Chapter 11 Petition Date: July 21, 2015
Court: United States Bankruptcy Court
District of New Jersey (Trenton)
Judge: Hon. Michael B. Kaplan
Debtor's Counsel: John F. Bracaglia, Jr., Esq.
MAURO, SAVO, CAMERINO, GRANT & SCHALK, P.A.
77 North Bridge Street
Somerville, NJ 08876
Tel: (908) 526-0707
Fax: (908) 725-8483
Email: brokaw@maurosavolaw.com
Total Assets: $996,306
Total Liabilities: $1.1 million
The petition was signed by Jennifer Billand, president.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/njb15-23627.pdf
WPCS INTERNATIONAL: Regains Compliance with NASDAQ Standards
------------------------------------------------------------
WPCS International Incorporated announced that on July 16, 2015, it
received written notification from the Listing Qualifications Staff
of The NASDAQ Stock Market LLC that WPCS had regained compliance
with the continued listing standards on the NASDAQ Capital Market
and that WPCS' common stock would continue to be listed on NASDAQ.
On July 15, 2015, WPCS had informed the Staff that, as a result of
closing a $1.5 million private placement, its stockholders' equity
exceeded the minimum $2.5 million stockholders' equity
requirement.
Sebastian Giordano, Interim CEO of WPCS, commented, "WPCS values
its NASDAQ Capital Market listing and we are extremely pleased with
the Staff's determination. The plan we executed to regain
compliance, not only increased our stockholders' equity, but
significantly improved our liquidity by eliminating short-term debt
and providing additional working capital. With this hurdle behind
us, we will continue pursuing a value proposition that delivers
increased shareholder value."
About WPCS International Incorporated
WPCS -- http://www.wpcs.com/-- operates in two business segments
including: (1) providing communications infrastructure contracting
services to the public services, healthcare, energy and corporate
enterprise markets worldwide; and (2) developing a Bitcoin trading
platform.
WPCS International incurred a net loss attributable to common
shareholders of $11.2 million for the year ended April 30, 2014,
as compared with a net loss attributable to common shareholders of
$6.91 million for the year ended April 30, 2013.
As of Jan. 31, 2015, the Company had $14.8 million in total assets,
$14.8 million in total liabilities and a $36,000 total deficit.
Marcum LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the
year ended April 30, 2014. The independent auditing firm
noted that the Company has incurred significant losses and needs
to raise additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
[*] Yellen to Conduct Liquidation of Construction Machinery
-----------------------------------------------------------
Yellen Partners, LLC , a financial services, asset management,
auctioneer and appraisal firm, on
July 21 announced the liquidation sale of more than $2.0 million of
former rental fleet construction equipment. The sale will be
conducted as an orderly liquidation in partnership with TDM
Machinery & Appraisal, Inc., a construction appraisal company, led
by Scott Minzak, vice president of TDM.
Assets available for bid include late model/low hour Caterpillar
rental fleets units, including D6T and D5K Dozers, 420F Backhoe
Loaders, 329EL Excavators and more.
"We're proud to offer users the opportunity to purchase high
quality Caterpillar equipment that has been professionally
maintained," said Brian Yellen, president of Yellen Partners. "TDM
has been a valuable partner with the industry expertise and
experienced leadership to help execute the sale of a large
percentage of the company's rental inventory."
About Yellen Partners, LLC
Yellen Partners, LLC -- http://www.yellenpartners.com-- is a
Victory Park Capital portfolio company that is a specialized,
hands-on provider of asset monetization solutions focused on the
acquisition and disposition of retail and wholesale inventories, as
well as healthcare and industrial machinery and equipment, for
businesses seeking to continue operations or sell assets as a going
concern. Core activities include sourcing, acquiring and
monetizing distressed and other surplus assets through transaction
strategies, including, but not limited to, retail store closings,
orderly liquidations of wholesale inventories and specialty assets,
as well as private treaty sales and on-site and on-line auctions.
About TDM Machinery & Appraisal, Inc.
TDM Machinery & Appraisal, Inc. -- http://www.tdmmachinery.com--
has over 30 years of experience in sales, marketing and appraising
construction and mining equipment throughout the United States,
Europe, Asia, Middle East, Mexico and Canada. Primary activities
include buying and selling equipment such as wheel loaders, end
dumps, motor graders, motor scrapers and dozers. TDM has global
partners and contacts that include major coal companies, CAT
dealers, contractors and Komatsu dealers.
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re Mark Daniel Rockrich and Jennifer Kathleen Rockrich
Bankr. D. Ariz. Case No. 15-08529
Chapter 11 Petition filed July 8, 2015
In re Southland Paving Company, LLC
Bankr. D. Ariz. Case No. 15-08531
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/azb15-08531.pdf
represented by: Kenneth L Neeley, Esq.
NEELEY LAW FIRM, PLC
E-mail: ecf@neeleylaw.com
In re Barone Romano, Inc.
Bankr. C.D. Cal. Case No. 15-11412
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/cacb15-11412.pdf
represented by: Keith F Rouse, Esq.
LAW OFFICE OF KEITH F ROUSE
E-mail: rouselaw@hotmail.com
In re Patricia Ann Cooper
Bankr. C.D. Cal. Case No. 15-13431
Chapter 11 Petition filed July 8, 2015
In re Mark J. Burkhardt and Karen M. Boyd-Burkhardt
Bankr. C.D. Cal. Case No. 15-13441
Chapter 11 Petition filed July 8, 2015
In re Miguel Angel Arevalo
Bankr. C.D. Cal. Case No. 15-20830
Chapter 11 Petition filed July 8, 2015
In re Fermatex Enterprises, Inc.
Bankr. M.D. Fla. Case No. 15-05911
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/flmb15-05911.pdf
represented by: Eric A Lanigan, Esq.
LANIGAN & LANIGAN, PL
E-mail: ecf@laniganpl.com
In re Greenback Services, Inc.
Bankr. N.D. Fla. Case No. 15-40374
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/flnb15-40374.pdf
represented by: Thomas B. Woodward, Esq.
E-mail: woodylaw@embarqmail.com
In re Favorite Things, Inc.
Bankr. N.D. Fla. Case No. 15-40375
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/flnb15-40375.pdf
represented by: Thomas B. Woodward, Esq.
E-mail: woodylaw@embarqmail.com
In re Juan M. Perez
Bankr. S.D. Fla. Case No. 15-22330
Chapter 11 Petition filed July 8, 2015
In re Donald A Pydynkowski
Bankr. D. Mass. Case No. 15-12697
Chapter 11 Petition filed July 8, 2015
In re Radomsk LLC
Bankr. E.D.N.Y. Case No. 15-43141
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/nyeb15-43141.pdf
filed Pro Se
In re E.G. Realty Enterprises, LLC
Bankr. E.D.N.Y. Case No. 15-43152
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/nyeb15-43152.pdf
represented by: David Carlebach, Esq.
The Carlebach Law Group
E-mail: david@carlebachlaw.com
In re PIC Sentry Rail Inc
Bankr. W.D. Wash. Case No. 15-14152
Chapter 11 Petition filed July 8, 2015
See http://bankrupt.com/misc/wawb15-14152.pdf
represented by: Steven C. Hathaway, Esq.
Email: s.hathaway@comcast.net
In re Jack S Junell and Lynn M Junell
Bankr. W.D. Wash. Case No. 15-14153
Chapter 11 Petition filed July 8, 2015
In re Parkside, Inc. d/b/a Parkside Christian Academy
Bankr. D. Mass. Case No. 15-12723
Chapter 11 Petition filed July 9, 2015
See http://bankrupt.com/misc/mab15-12723.pdf
represented by: Denzil D. McKenzie, Esq.
MCKENZIE & ASSOCIATES, P.C.
E-mail: dmckenzie@mckenzielawpc.com
In re Judith Carr
Bankr. D.N.J. Case No. 15-22885
Chapter 11 Petition filed July 9, 2015
In re Body Symphonic, LLC
Bankr. D.N.J. Case No. 15-22944
Chapter 11 Petition filed July 9, 2015
See http://bankrupt.com/misc/njb15-22944.pdf
represented by: John J. Scura, III, Esq.
SCURA, WIGFIELD, HEYER & STEVENS, LLP
E-mail: jscura@scuramealey.com
In re Louya Corp.
Bankr. S.D.N.Y. Case No. 15-11789
Chapter 11 Petition filed July 9, 2015
See http://bankrupt.com/misc/nysb15-11789.pdf
represented by: Douglas J. Pick, Esq.
PICK & ZABICKI LLP
E-mail: dpick@picklaw.net
In re TSG Commercial Solutions, Inc.
Bankr. N.D. Ohio Case No. 15-51675
Chapter 11 Petition filed July 9, 2015
See http://bankrupt.com/misc/ohnb15-51675.pdf
represented by: Marc P Gertz, Esq.
GOLDMAN & ROSEN, LTD
E-mail: mpgertz@goldman-rosen.com
In re Nck Inc
Bankr. W.D. Pa. Case No. 15-70491
Chapter 11 Petition filed July 9, 2015
filed Pro Se
In re Tommy Clay Thompson and Linda Yvonne Thompson
Bankr. W.D. Tenn. Case No. 15-26350
Chapter 11 Petition filed July 9, 2015
In re B&B Alexandria Corporate Park TIC 10, LLC
Bankr. E.D. Va. Case No. 15-12361
Chapter 11 Petition filed July 9, 2015
filed Pro Se
In re Logan H Sherris and Melodee A Sherris
Bankr. W.D. Wash. Case No. 15-14192
Chapter 11 Petition filed July 9, 2015
In re Beck & Beck Enterprise Inc
Bankr. D. Ariz. Case No. 15-08655
Chapter 11 Petition filed July 10, 2015
See http://bankrupt.com/misc/azb15-08655.pdf
represented by: Bert L. Roos, Esq.
BERT L. ROOS, PC
E-mail: blrpc85015@msn.com
In re Martha Alicia Ybanez
Bankr. C.D. Cal. Case No. 15-12364
Chapter 11 Petition filed July 10, 2015
In re Thomas John Bishop
Bankr. C.D. Cal. Case No. 15-20999
Chapter 11 Petition filed July 10, 2015
In re LBG Holdings LLC
Bankr. D. Conn. Case No. 15-21224
Chapter 11 Petition filed July 10, 2015
See http://bankrupt.com/misc/ctb15-21224.pdf
represented by: Peter L. Ressler, Esq.
GROOB RESSLER & MULQUEEN
E-mail: ressmul@yahoo.com
In re Billy Joe Edwards
Bankr. W.D. La. Case No. 15-11232
Chapter 11 Petition filed July 10, 2015
In re Alan M. Webb
Bankr. D. Minn. Case No. 15-32538
Chapter 11 Petition filed July 10, 2015
In re Valgir, Inc.
Bankr. D.N.J. Case No. 15-22955
Chapter 11 Petition filed July 10, 2015
See http://bankrupt.com/misc/njb15-22955.pdf
represented by: Kenneth J. Rosellini, Esq.
E-mail: kennethrosellini@gmail.com
In re DOO LIM LEE AND MYUNG OK LEE
Bankr. D.N.J. Case No. 15-22981
Chapter 11 Petition filed July 10, 2015
In re J&C Foods, Inc
Bankr. D.N.J. Case No. 15-22988
Chapter 11 Petition filed July 10, 2015
See http://bankrupt.com/misc/njb15-22988.pdf
represented by: Joseph Casello, Esq.
COLLINS, VELLA & CASELLO
E-mail: jcasello@cvclaw.net
In re Wilfredo Chinea Oliveras
Bankr. D.P.R. Case No. 15-05281
Chapter 11 Petition filed July 10, 2015
In re Elisa Luisa Infante Miranda
Bankr. D.P.R. Case No. 15-05294
Chapter 11 Petition filed July 10, 2015
In re Saint Mark Senior Living, LLC
Bankr. E.D. Wash Case No. 15-02379
Chapter 11 Petition filed July 10, 2015
See http://bankrupt.com/misc/waeb15-02379.pdf
represented by: Noel J Pitner, Esq.
PITNER LAW, PLLC
E-mail: njp@pitnerlaw.net
In re SPM Midwest Foods, LLC
Bankr. N.D. Ill. Case No. 15-23749
Chapter 11 Petition filed July 11, 2015
See http://bankrupt.com/misc/ilnb15-23749.pdf
represented by: John J Lynch, Esq.
Lynch Law Offices, P.C.
E-mail: jlynch@lynch4law.com
In re Lanker Partnership
Bankr. C.D. Cal. Case No. 15-12380
Chapter 11 Petition filed July 12, 2015
See http://bankrupt.com/misc/cacb15-12380.pdf
represented by: Charles Shamash, Esq.
Caceres & Shamash LLP
E-mail: cs@locs.com
In re Enrique V. Greenberg
Bankr. S.D. Cal. Case No. 15-04631
Chapter 11 Petition filed July 13, 2015
In re Curtis James Jackson, III
Bankr. D. Conn. Case No. 15-21233
Chapter 11 Petition filed July 13, 2015
In re Amy L. Freeland and Bradley Freeland
Bankr. N.D. Fla. Case No. 15-40384
Chapter 11 Petition filed July 13, 2015
In re Tileworks of Evanston, LLC
dba Country Floors
Bankr. N.D. Ill. Case No. 15-23862
Chapter 11 Petition filed July 13, 2015
See http://bankrupt.com/misc/ilnb15-23862.pdf
represented by: Karen J. Porter, Esq.
PORTER LAW NETWORK
E-mail: porterlawnetwork@gmail.com
In re Argelia M. Gameros
Bankr. D. Nev. Case No. 15-14028
Chapter 11 Petition filed July 13, 2015
In re Growth Opportunity Alliance of Greater Lawrence, Inc.
dba GOAL/QPC
Bankr. D.N.H. Case No. 15-11098
Chapter 11 Petition filed July 13, 2015
See http://bankrupt.com/misc/nhb15-11098.pdf
represented by: William S. Gannon, Esq.
WILLIAM S. GANNON, PLLC
E-mail: bgannon@gannonlawfirm.com
In re Rogelio A. Peralta
Bankr. D.N.J. Case No. 15-23063
Chapter 11 Petition filed July 13, 2015
In re Costas Kondylis
Bankr. S.D.N.Y. Case No. 15-11831
Chapter 11 Petition filed July 13, 2015
In re Dumfries Collision Center
dba Dumfries Auto Repair Collision Center
Bankr. E.D. Va. Case No. 15-12414
Chapter 11 Petition filed July 13, 2015
See http://bankrupt.com/misc/vaeb15-12414.pdf
represented by: George LeRoy Moran, Esq.
MORAN MONFORT, PLC
E-mail: glmoran@yahoo.com
In re 2070, Inc.
Bankr. E.D. Va. Case No. 15-12417
Chapter 11 Petition filed July 13, 2015
See http://bankrupt.com/misc/vaeb15-12417.pdf
represented by: John T. Donelan, Esq.
LAW OFFICE OF JOHN T. DONELAN
E-mail: donelanlaw@gmail.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.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
*********
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, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2015. 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 202-362-8552.
*** End of Transmission ***