/raid1/www/Hosts/bankrupt/TCR_Public/151111.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, November 11, 2015, Vol. 19, No. 315
Headlines
33 PECK SLIP: Full-Payment Plan Set for Nov. 30 Hearing
8 SPEED 8: Snell & Wilmer Wants Court to Dismiss Conspiracy Suit
AKORN INC: S&P Lowers CCR to 'B', On CreditWatch Developing
ALPHA NATURAL: Sale of 16 Mines Draws Creditor Objections
ARAL PETROLEUM: To Pursue Kazakh Rehabilitation Procedures
ARAMID ENTERTAINMENT: Wants Court to Dismiss $2 Million Tax Bill
ARCHDIOCESE OF MILWAUKEE: Judge Approves Bankruptcy-Exit Plan
ATLANTIC & PACIFIC: Nov. 30 Set as General Claims Bar Date
ATLANTIC & PACIFIC: NYCB Opposes Sale of Assets to Brixmor
ATP OIL: Court Denies Diamond Offshore's Bid to Junk Sec.547 Claims
AVT INC: Shareholder Leads Capital Raise to Help Chapter 11 Exit
BANKRATE INC: Moody's to Retain B1 CFR on Sale of Insurance Unit
CAESARS ENTERTAINMENT: Agrees to 4th Extension of Challenge Period
CAESARS ENTERTAINMENT: Has Until May 15 to Confirm Ch. 11 Plan
CAESARS ENTERTAINMENT: Indenture Trustee Seeks to Sue Guarantors
CAESARS ENTERTAINMENT: Kirkland Blasts Creditors Renewed DQ Bid
CAESARS ENTERTAINMENT: Seeks Approval of CPLV, FinCEN Settlement
CHANNEL CONSTRUCTION: Attorney's Fees Reduced to $47K
COLT DEFENSE: Wins Approval of Disclosure Statement
COMMUNITY HEALTH: S&P Affirms 'B+' CCR & Revises Outlook to Neg.
COMMUNITY HOME: Court Grants Interim Approval of Atty Fees
COMSTOCK RESOURCES: S&P Affirms 'CCC' Rating on 7.75% Sr. Notes
CTI BIOPHARMA: Incurs $32.6 Million Net Loss in Third Quarter
CULLMAN REGIONAL: Fitch Affirms 'BB+' Rating on $61.2MM Rev. Bonds
CULLMAN REGIONAL: Fitch Affirms 'BB+' Rating on 2016 Rev. Bonds
CYPRESS SEMICONDUCTOR: S&P Assigns 'BB-' CCR, Outlook Stable
DORAL FINANCIAL: Has Until Dec. 1, 2015 to Propose Chapter 11 Plan
ENERGY FUTURE: Begins Massive Push for Ch. 11 Plan Confirmation
ENERGY FUTURE: Court Denies 2nd Lien Trustee's Summary Judgment Bid
ENERGY FUTURE: Judge Sides With Debtor on Make-Whole Issue
ENERGY FUTURE: Judge's Ruling Might Shut Down Major Plan Objection
ERG INTERMEDIATE: Change of Venue Not Warranted, Court Says
ESSAR STEEL: Seeks CCAA Protection, Obtains DIP Financing
ESTERLINA VINEYARDS: Provencher & Flatt Approved as Counsel
FAR EAST ENERGY: Files Voluntary Ch. 7 Petition, Halts Operations
FIDELITY & GUARANTY: Fitch Puts 'BB-' Rating on Watch Evolving
FIDELITY & GUARANTY: Moody's Affirms Ba3 Rating on Unsecured Debt
FIDELITY & GUARANTY: S&P Puts 'BB-' Rating on CreditWatch Dev.
FREEDOM COMMUNICATIONS: Wants Court to Approve $22.4M Financing
FRESH & EASY: Workers Assert Layoffs Broke State Labor Laws
GENERAL MOTORS: HGM Comments on Ignition Switch Ruling
GENERAL MOTORS: May Face Punitive Damages Over Ignition Switches
GENERAL MOTORS: Union Accuses Cheating Retirees Out of Benefits
GOODRICH PETROLEUM: S&P Lowers Rating on Series C Stock to 'D'
HAGGEN HOLDINGS: Albertsons Bidding on Stores at Auction
HARVARD APPARATUS: Receives Nasdaq Listing Non-Compliance Notice
HCA INC: Moody's Assigns B1 Rating on Proposed $1BB Bond Offering
HCA INC: S&P Assigns 'B+' Rating on New $1BB Sr. Unsecured Notes
HOVNANIAN ENTERPRISES: Moody's Lowers Corp. Family Rating to Caa1
HUDSON HEALTHCARE: Cityside's Suit Remanded to NJ State Court
JAMUL INDIAN: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable
KEVIN EDGELL: Ohio Appeals Court Affirms Contempt Order
KITTUSAMY LLP: Proposes Chapter 11 Plan of Reorganization
LEAHY TRANSPORTATION: Voluntary Chapter 11 Case Summary
LONESTAR GEOPHYSICAL: Bank Creditor Wants More Disclosures
LONESTAR GEOPHYSICAL: UST Has Issues With Disclosure Statement
MAUI LAND: Reports Third Quarter 2015 Results
MICROVISION INC: Incurs $3.51 Million Net Loss in Third Quarter
MILLENNIUM HEALTH: Files Chapter 11 to Facilitate Restructuring
MILLENNIUM LAB: Case Summary & 20 Largest Unsecured Creditors
MOLYCORP INC: Creditors Cry Foul Over Bankruptcy Plan
MORGANS HOTEL: Incurs $11.7 Million Net Loss in Third Quarter
MOTORS LIQUIDATION: Bledsoe Plaintiffs' Post-Judgment Bids Denied
NEUSTAR INC: S&P Lowers Rating on Sr. Secured Debt to 'BB'
NEWSTAR FINANCIAL: Fitch to Rate Upsized Unsec. Notes 'BB-'
NRAD MEDICAL: Court Approves Margolin Winer as Accountants
NRAD MEDICAL: Lindenwood Okayed as Chief Restructuring Consultant
NRAD MEDICAL: SilvermanAcampora Approved as Bankruptcy Counsel
ORGANIC AVENUE: Yellen Partners to Conduct Auction on Nov. 16
PACIFIC RECYCLING: Gleaves Swearingen Approved as Panel's Counsel
PARALLEL ENERGY: Files for Chapter 11 with $110M Purchase Deal
PARALLEL ENERGY: Seeks Joint Administration of Cases
PENTON OPERATING: Moody's Raises CFR to B2, Outlook Stable
PINETREE CAPITAL: Cures "Event of Default" on Secured Debentures
PUTNAM ENERGY: 3rd Attempt on Insider Sale of Oil & Gas Rights Hit
PWK TIMBERLAND: Wants Authority to Sell Louisiana Real Estate
QORVO INC: S&P Assigns 'BB+' CCR & Rates $1BB Sr. Notes 'BB+'
QUAD/GRAPHICS INC: Moody's Lowers CFR to Ba3, Outlook Negative
QUIRKY INC: Meeting of Creditors Set for Nov. 17
QUIRKY INC: Names Q Holding as Stalking Horse for Remaining Assets
RACKSPACE HOSTING: Moody's Assigns 'Ba1' CFR, Outlook Stable
RACKSPACE HOSTING: S&P Assigns 'BB+' CCR, Outlook Stable
REIT COMMUNICATIONS: S&P Lowers CCR to 'B+', Outlook Stable
RELATIVITY MEDIA: CEO Denies Involvement With Hunter Killer Project
RELATIVITY MEDIA: Gets Nod on $35M Amended Ch. 11 Financing
ROTONDO WEIRICH: Creditors Have Until Next Week to File Claims
RR DONNELLEY: Moody's Puts Ba2 CFR on Review for Downgrade
SAINT MICHAEL'S MEDICAL: $15MM DIP Financing Has Final Approval
SARKIS INVESTMENTS: Plan Outline Hearing Continued to Jan. 27
SEQUENOM INC: Incurs $9.4 Million Net Loss in Third Quarter
SNOHOMISH COUNTY: Fitch Affirms B Rating on Series 2004 LTGO Bonds
SOMERSET REGIONAL: Case Summary & 20 Largest Unsecured Creditors
SP KOROLEV: Boeing's Bid for Severe Sanctions Denied
SPARTAN CONSTRUCTION: Case Summary & 20 Top Unsecured Creditors
STEREOTAXIS INC: Reports $997,000 Net Loss for Third Quarter
SUMMIT STREET: To Seek Approval of Ch. 11 Plan on Nov. 24
SUMMIT STREET: Wolverine Bank Says Plan Unconfirmable
TEAM HEALTH: Moody's Lowers CFR to Ba3 & Rates $965MM Loan Ba2
TEEKAY CORP: Moody's Assigns B2 Rating on $200MM Notes Add-On
TLC SCHOOL BUS: Voluntary Chapter 11 Case Summary
VANTIV LLC: S&P Raises CCR to 'BB+', Outlook Stable
WBH ENERGY: Creditors' Committee Dissolved as of Effective Date
WELLCARE HEALTH: Moody's Gives (P)Ba2 Rating on Shelf Registration
WESTMORELAND COAL: Posts $46.5 Million Net Loss for Third Quarter
YELLOWSTONE MOUNTAIN: Court Overturns $2.2-Mil. Judgment
[*] Fitch: US Coal Producers Restructuring for a Smaller Footprint
[*] Kaufman, Owsley Completes Distressed Investment Banking Book
[*] October Bankruptcy Filings Increased 11% Over Previous Month
*********
33 PECK SLIP: Full-Payment Plan Set for Nov. 30 Hearing
-------------------------------------------------------
33 Peck Slip Acquisition LLC, et al., which have a full-payment
plan that will be funded from the sales of 4 New York City hotel
properties, has scheduled a Nov. 30 hearing to seek confirmation of
the Chapter 11 plan.
At the behest of the Debtors, Judge James L. Garry, Jr., on Oct. 19
approved a confirmation schedule, setting:
* A Nov. 13, 2015, 2:00 p.m. deadline for objections or proposed
modifications, if any, to the Plan.
* A Nov. 20, 2:00 p.m. deadline for any declarations in support
of confirmation.
* A status conference on Nov. 24 at 2:00 p.m. to discuss any
issues relating to the confirmation hearing.
* A confirmation hearing on the Plan on Nov. 30 at 2:00 p.m.
The New York City Department of Finance ("NYCDOF") submitted a plan
confirmation objection prior to the Oct. 7 hearing on the Debtors'
motion to set a plan confirmation schedule. The Debtor responded
by pointing out that they are not seeking to confirm the plan or
sell property at the Oct. 7 hearing, and thus, the objections are
premature and should be overruled.
The Debtors have prepared a joint plan, which provides for the sale
of each of the Debtors' real estate assets and the distribution of
the sale proceeds to the applicable Debtor's creditors and members.
All creditor classes will either receive payment in full on the
effective date of the Plan or will retain unaltered the legal,
equitable, and contractual rights, and all member classes will
retain their interests. Because the Plan does not propose to
impair any class of claims or interests, the Debtors won't be
soliciting votes on the Plan.
The distribution to creditors will be funded from the proceeds of
the sale of the Debtors' real estate assets:
* 33 Peck has entered into an agreement to sell its real
property located at 33 Peck Slip, New York, NY, to Morning View
Hotels - New York Seaport, LLC for $37,300,000.
* 36 West has entered into an agreement to sell its real
property located at 36 West 38th Street, New York, NY, to Hansji
Corporation for $25,500,000. Subsequently, Hanji Corporation
elected to terminate the agreement. The Debtors expect that a new
agreement with a new buyer will be filed with the Bankruptcy Court
prior to the Confirmation Hearing.
* 37 West has entered into an agreement to sell its real
property located at 37 West 24th Street, New York, NY, to Bridgeton
Acquisitions LLC for $57,000,000.
* 52 West has entered into an agreement to sell its real
property located at 52 West 13th Street, New York, NY, to Bridgeton
Acquisitions LLC for $78,000,000.
Each of the sales, subject to higher and better bids, will be
consummated in connection with the Plan.
The Debtors on Oct. 15, 2015, filed a second supplement, containing
black-lined copies of the revised disclosure statement and plan. A
copy of the document is available for free at:
http://bankrupt.com/misc/33_PeckSlip_98_2nd_PS_Rev_DS.pdf
About 33 Peck
Owners of four New York City hotel properties, namely 33 Peck Slip
Acquisition LLC, Gemini 37 West 24th Street MT, LLC, 36 West 38th
Street LLC and 52 West 13th P, LLC, have sought Chapter 11
bankruptcy protection, intending to auction off their assets in
connection with a Chapter 11 plan. The Debtors are affiliated with
Gemini Real Estate Advisors.
As of the bankruptcy filing, the Debtors owned:
* the Best Western Seaport Hotel, at 33 Peck Slip in the South
Street Seaport Historic District on the Lower Manhattan waterfront
in New York City, New York;
* the Wyndham Flatiron Hotel, at 37 West 24th Street in the
Flatiron district of New York City, New York;
* the Jade Greenwich Village Hotel at 52 West 13th Street in
Greenwich Village in Lower Manhattan in New York City, New York;
and
* the Bryant Park Development Site, a development lot that is
approved for development as a 114-room boutique hotel at 34-36
West 38th Street in the Bryant Park district of New York City, New
York.
33 Peck Slip Acquisition LLC, et al., sought Chapter 11 bankruptcy
petition (Bankr. S.D.N.Y. Case Nos. 15-12479 to 15-12482) on
Sept. 3, 2015.
The Debtors reported total assets of $205.8 million and total
liabilities of $135.6 million.
The Debtors tapped Robins Kaplan LLP as attorneys; and
RobertDouglas as real estate advisor.
* * *
The bar date for filing proofs of claim is Dec. 16, 2015.
The Debtors have submitted a liquidating plan that will pay off
creditors from proceeds of the sale of the assets.
The Debtors have solicited stalking horse initial offers for the
properties totaling $200 million, subject to potential higher bids
at a Nov. 10 auction. The Debtors plan to sell the Seaport hotel
for $37.5 million, the Jade hotel for $78 million, the Wyndham
hotel for $57 million, and the development site for $25.5 million.
8 SPEED 8: Snell & Wilmer Wants Court to Dismiss Conspiracy Suit
----------------------------------------------------------------
Dani Meyer at Bankruptcy Law360 reported that Snell & Wilmer LLP
urged a Florida federal court on Nov. 2, 2015, to dismiss them from
a suit alleging they conspired with others to bankrupt a payment
terminal company, accusing the shareholder who filed the suit of
deliberately trying to confuse the court and hide the truth
regarding the bankruptcy.
The firm said that 8 Speed 8 LLC's bankruptcy wasn't found to be
filed in bad faith despite Edward Mandel and his corporation Vibe
Micro Inc.'s statements to the contrary in their opposition to
Snell & Wilmer's attempt.
AKORN INC: S&P Lowers CCR to 'B', On CreditWatch Developing
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Lake Forest, Ill.-based Akorn Inc. to 'B' from 'B+'. At
the same time, S&P placed all of the ratings on the company on
CreditWatch with developing implications.
"The downgrade is based on our belief that, while the company has
provided enough financial information to support the company's
current business and financial risk profiles, we believe the
effectiveness of management and governance is weak at this time,"
said Standard & Poor's credit analyst Michael Berrian. At present,
the last audited financials that can be relied upon is for the
period ended March 31, 2014.
Still, S&P's decision to maintain a rating, albeit one notch lower
at 'B', reflects its opinion that the information produced in the
Nov. 4, 2015, 8-K filing is of sufficient quality to support S&P's
business and financial risk assessments and maintain its corporate
credit rating.
S&P's view of Akorn's business risk profile as "weak" largely
reflects its minimal scale and scope in the highly competitive
generic pharmaceutical market. Akorn competes against much larger
participants in the industry that have significantly greater
financial capacity and also with other smaller generic companies
that have growing pipelines of abbreviated new drug applications
(ANDAs) and proven track records of successfully integrating
acquisitions. While these larger competitors have kept their
distance from many of the niche generic formulations Akorn
manufactures, S&P believes the comparatively higher margins of
these products could spur greater competition over time.
S&P believes Akorn is well positioned, though, to capitalize on the
growth trends in generic pharmaceuticals. It continues to launch
new products and the company is increasingly investing in R&D: it
had 78 ANDA filings under review at the FDA at Oct. 31, 2015. S&P
expects this product pipeline will enable Akorn to organically grow
roughly in line with the industry.
S&P's assessment of Akorn's financial risk profile as "aggressive"
incorporates S&P's expectation that, despite the absence of audited
financials, the company will maintain leverage in no more than the
4x to 4.5x range and funds from operations (FFO) to total debt will
be more than 12%.
"We will continue to monitor developments as the company works
through its re-audit process. Although we expect to resolve the
CreditWatch no later than the end of February 2016, we could take
action sooner if we are no longer confident in our business or
financial risk assessments. We could also take action sooner if we
believe that governance deficiencies are more severe than we
thought, and warrant additional downgrades. Disclosures of
additional weaknesses in internal controls, additional
investigations from regulatory or other government institutions, or
additional management departures could prompt such an action. The
CreditWatch developing reflects prospects for restoration of the
credit rating to 'B+' if the company files its 2014 re-audit by the
end of first-quarter 2016. However, if the re-audit is delayed
beyond first-quarter 2016 we could lower the rating, possibly by
multiple notches," S&P said.
ALPHA NATURAL: Sale of 16 Mines Draws Creditor Objections
---------------------------------------------------------
Cara Salvatore at Bankruptcy Law360 reported that Alpha Natural
Resources' plans to sell 16 Appalachian mines have drawn multiple
creditor objections in the bankruptcy court overseeing Alpha's
restructuring, including one from a union that claims the sale
blueprint brushes aside obligations to retirees.
Pocahontas Land Co., Lexon Insurance Co., Bond Safeguard Insurance
Co., Coal Mountain Mining Co. LLP, Commonwealth Coal Corp.,
Kentucky River Properties LLC, and Capital One NA are among the
companies filing recent objections to Alpha Natural Resources
Inc.'s sale plans.
About Alpha Natural
Alpha Natural -- http://www.alphanr.com/-- is a coal supplier,
ranked second largest among publicly traded U.S. coal producers as
measured by 2014 consolidated revenues of $4.3 billion.
Alpha Natural Resources, Inc. (Bankr. E.D. Va. Case No. 15-33896)
and its affiliates filed separate Chapter 11 bankruptcy petitions
on Aug. 3, 2015, listing $9.9 billion in total assets as of June
30, 2015, and $7.3 billion in total liabilities as of June 30,
2015. The petition was signed by Richard H. Verheij, executive
vice president, general counsel and corporate secretary.
Judge Kevin R. Huennekens presides over the case.
David G. Heiman, Esq., Carl E. Black, Esq., and Thomas A. Wilson,
Esq., at Jones Day serve as the Debtors' general counsel.
Tyler P. Brown, Esq., J.R. Smith, Esq., Henry P. (Toby) Long, III,
Esq., and Justin F. Paget, Esq., serve as the Debtors' local
counsel. Rothschild Group is the Debtors' financial advisor.
Alvarez & Marshal Holdings, LLC, is the Debtors' investment
banker. Kurtzman Carson Consultants, LLC, is the Debtors' claims
and noticing agent.
The U.S. Trustee for Region 4 appointed seven creditors of Alpha
Natural Resources Inc. to serve on the official committee of
unsecured creditors.
ARAL PETROLEUM: To Pursue Kazakh Rehabilitation Procedures
----------------------------------------------------------
Caspian Energy Inc. on Nov. 9 disclosed that, after careful
consideration of all available alternatives, the board of directors
of Caspian has determined that it is in the best interests of
Caspian and its wholly-owned subsidiary, Aral Petroleum Capital
LLP, to authorize Aral to seek protection from its trade creditors
under the Law of the Republic of Kazakhstan On Rehabilitation and
Bankruptcy through implementation of rehabilitation procedures.
As noted in a news release dated August 4, 2015, Aral has a number
of outstanding trade payables that it has been unable to discharge
due to its lack of operational revenues and positive cash flow.
Some of these trade creditors have pursued litigation in Kazakhstan
that has resulted in Aral's bank accounts being frozen. Pursuant
to the Bankruptcy Law, Aral will apply to the court for
implementation of the Rehabilitation Procedures. If Aral is able
to successfully negotiate the Rehabilitation Procedures with its
creditors and obtain the requisite court approval, it will prevent
trade creditors and others from commencing litigation against Aral
for payment of outstanding amounts and afford it the ability to
restructure its financial affairs for a period of up to five years.
The process of applying for the Rehabilitation Procedures will
result in an automatic moratorium of up to two months on claims by
creditors regardless of whether or not negotiations are successful.
There can be no assurance that Aral will be successful in
negotiating the Rehabilitation Procedures.
"The Rehabilitation Procedures have the potential to facilitate
Aral's access to its existing loans and other capital, and provide
it with additional time to focus on recommencing oil production.
If successful, this will generate operational cash flow and help to
stabilize the economic outlook for both Caspian and Aral," said
Michael Nobbs, Chairman of the Board.
A further update will be provided as additional information becomes
available.
About Caspian
Caspian is an oil and gas exploration and development company,
operating in Kazakhstan through Aral, which has a number of targets
in the highly prospective Aktobe Oblast of Western Kazakhstan.
Caspian indirectly holds, through its interest in Aral, an
exclusive licence pursuant to an exploration contract, which
entitles it to explore and develop certain oil and gas properties
known as the "North Block," an area of 1,467 square km, and a
production contract for the area known as "East Zhagabulak".
ARAMID ENTERTAINMENT: Wants Court to Dismiss $2 Million Tax Bill
----------------------------------------------------------------
Eric Kroh at Bankruptcy Law360 reported that film financing hedge
fund Aramid Entertainment Fund Ltd. on Oct. 30, 2015, asked a New
York federal bankruptcy court to dismiss claims by the Internal
Revenue Service that it and related firms owe some $2 million in
taxes, saying the entities have no tax liabilities for the year in
question.
The IRS is not taking into account some $3.4 million in deductions
taken in 2012 by Aramid Entertainment Inc., which is owned by AEF,
the firm said.
About Aramid Entertainment
Aramid Entertainment Fund Limited has been engaged in the
businesses of providing short and medium term liquidity to
producers and distributors of film, television and other media and
entertainment content by way of loans and equity investments.
On May 7, 2014, Geoffrey Varga and Jess Shakespeare of Kinetic
Partners (Cayman) Limited were appointed under Cayman law as the
joint voluntary liquidators ("JVLs") of AEF and two affiliates.
On June 13, 2014, the JVLs authorized AEF and two affiliates to
file for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead
Case No. 14-11802) in Manhattan on June 13, 2014.
The Debtors have tapped James C. McCarroll, Esq., Jordan W. Siev,
Esq., Richard A. Robinson, Esq., and Michael J. Venditto, Esq. of
Reed Smith, LLP, in New York, as counsel and Kinetic Partners
(Cayman) Limited as crisis managers.
AEF estimated at least $100 million in assets and between $10
million to $50 million in liabilities.
ARCHDIOCESE OF MILWAUKEE: Judge Approves Bankruptcy-Exit Plan
-------------------------------------------------------------
Tom Corrigan, writing for Dow Jones' Daily Bankruptcy Review,
reported that a federal judge on Nov. 9 cleared the way for the
Roman Catholic Archdiocese of Milwaukee to bring its nearly
five-year-old chapter 11 bankruptcy case to a close.
The Troubled Company Reporter, on Nov. 6, 2015, reported that the
Chapter 11 plan of reorganization was made possible by a $21
million settlement with about 350 victims of clergy sex abuse.
The Debtor on Sept. 25, 2015, filed a Fourth Amended Disclosure
Statement for the Second Amended Chapter 11 Plan of
Reorganization.
The Fourth Amended Disclosure Statement updates the Third Amended
Disclosure Statement filed on Aug. 24, 2015, which updated the
Disclosure Statement approved by the Court on May 28, 2014.
Judge Susan V. Kelley on Oct. 5, 2015, approved the Fourth Amended
Disclosure Statement and scheduled a Nov. 9 hearing to consider
confirmation of the Second Amended Plan. The judge set a Nov. 3
deadline for ballots and objections. The Debtor is to file a
ballot report by Nov. 6.
Holders of claims against the Debtor that are impaired by the Plan
and that will receive a distribution on account of the claims are
entitled to vote on the Plan. Solicitation packages were sent to
holders of claims in Classes 1, 8, 9, 11, and 12.
Treatment of Claims
The Debtor's Plan will be funded by a $10.71 million settlement
with insurers, and a settlement with the Archdiocese of Milwaukee
Catholic Cemetery Perpetual Care Trust, which has agreed to
provide
an $8 million contribution to the "plan trust" established under
the Plan, and a $3 million loan by the Cemetery Trust.
The Debtor says that without the insurance settlements, the Abuse
Survivor recovery would be reduced by more than 50%, and the
Archdiocese would likely be able to pay only the administrative
expense claims.
The Plan Trust assets will consist of $21,250,000 in cash,
one-half
of the estimated $569,000 the Archdiocese expects to receive by
filing a claim with the United Kingdom's Financial Services
Compensation Scheme (but only to the extent of 50% of any
recoveries actually received), and the right to pursue recoveries
against any non-settling insurers (the "Plan Trust Assets").
According to the Fourth Amended Disclosure Statement, the Plan
provides that:
-- Holders of administrative claims estimated at $8 million
will
be paid in full in cash on the Effective Date.
-- Park Bank's secured claim of $4.39 million (Class 1) will
have its loan documents restructured to provide for a three-year
term, interest at 5.25 percent per annum, no prepayment penalty
and
monthly payments of $59,000 per month.
-- Priority claims (Class 2), if any, will be paid in cash on
the Effective Date.
-- The holders of the priests' retiree medical plan claims
estimated at $19.9 million (Class 3), the priests' pension plan
claims (Class 4), the union employees' pension plan claims (Class
5) and the lay employees' pension plan claims (Class 6) are
unimpaired. The Archdiocese will assume its participation in the
medical plan and pension plans.
-- As to perpetual care claims estimated at $246,000 (Class 7),
the Reorganized Debtor will be discharged from all contractual and
other civil liability to provide perpetual care and maintenance of
the Milwaukee Catholic Cemeteries, although the Reorganized Debtor
intends to continue to maintain the Milwaukee Catholic Cemeteries
because canon law requires it to continue caring for the
Cemeteries.
-- The 352 holders of abuse survivor plan pool claims (Class 8)
will receive (i) the right to request therapy payment assistance
from a $500,000 therapy fund, (ii) a claim against the Plan Trust
for distribution in accordance with the allocation protocols, and
(iii) payment of counsel fees and expenses from individual
recoveries. Class 8 claims are those claims that meet these
criteria: (1) the Claimant did not release the Archdiocese from
liability associated with the Abuse; and (2) the claim alleges
sexual abuse of a minor by either (a) a priest on the List of
substantiated abusers or (b) a member of a religious order or lay
person working at a catholic entity.
-- The 105 holders of unsubstantiated sexual abuse claims
receiving a distribution at the creditors' committee's request
(Class 9) will each receive $2,000 from the Plan Trust in full
satisfaction of his/her claim.
-- The 123 holders of disallowed/disputed sexual abuse claims
(Class 10) will be entitled to receive therapy payment assistance
from the $500,000 therapy fund.
-- With respect to the future claimant representative claims,
for abuse survivor proofs of claim or complaints filed in the next
six years (Class 11), the claimants will be paid from the $250,000
reserve, and may receive therapy assistance.
-- Holders of general unsecured claims (Class 12), scheduled at
$3.85 million, will each receive the lesser of (i) the amount of
their allowed claim or (ii) $5,000 if the class votes to accept
the
Plan. If the class rejects the Plan, the claimants won't receive
anything.
-- Charitable gift annuity claims (Class 13) are unimpaired.
-- Holders of penalty claims (Class 14) won't receive or retain
any property under the Plan.
A copy of the Fourth Amended Disclosure Statement dated Sept. 25,
2015, is available for free at:
http://bankrupt.com/misc/ArchD_Milw_3277_4th_Am_DS.pdf
About the Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX.
The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan,
Walworth, Washington and Waukesha. There are 657,519 registered
Catholics in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case
No. 11-20059) on Jan. 4, 2011, to address claims over sexual
abuse by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
The Archdiocese estimated assets and debts of $10 million to $50
million in its Chapter 11 petition.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel.
The Official Committee of Unsecured Creditors in the bankruptcy
case has retained Pachulski Stang Ziehl & Jones LLP as its
counsel, and Howard, Solochek & Weber, S.C., as its local
counsel.
ATLANTIC & PACIFIC: Nov. 30 Set as General Claims Bar Date
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
established Nov. 30, 2015 at 5:00 p.m., as the deadline for any
individual or entity to file proofs of claim against The Great
Atlantic & Pacific Tea Company, Inc., et al.
Governmental bar date is set for Jan. 19, 2016 at 5:00 p.m.
Proofs of claims must be filed with the noticing agent, Prime Clerk
LLC by:
1. mailing the original proof of claim form either by U.S.
Postal Service mail or overnight delivery to:
The Great Atlantic & Pacific Tea Company, Inc.
Claims Processing Center
c/o Prime Clerk LLC
830 3rd Avenue, 3rd Floor
New York, NY 10022
or
2. delivering the original proof of claim by hand to:
The U.S. Bankruptcy Court Southern District of New York
300 Quarropas Street
White Plains, NY 10601
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 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.
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.
The Debtor disclosed total assets of $601,441,108 and total
liabilities of $1,984,459,086 as of the Petition Date.
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 U.S. Trustee for Region 2 appointed seven creditors to serve
On the official committee of unsecured creditors. Pachulski Stang
Ziehl & Jones LLP serves as its counsel, and Zolfo Cooper, LLC as
serves as its financial advisors and bankruptcy consultants.
Elise S. Frejka was appointed as consumer privacy ombudsman.
ATLANTIC & PACIFIC: NYCB Opposes Sale of Assets to Brixmor
----------------------------------------------------------
New York Community Bank has expressed its opposition to the
proposed sale of A&P Real Property LLC's assets to Brixmor SPE 2
LLC.
A&P, an affiliate of Great Atlantic & Pacific Tea Company Inc., has
entered into a deal with Brixmor, which offered to buy the assets
used in operating its retail store located at 1757 Central Park
Avenue, in New York.
The bank, which operates a branch at A&P's retail store, expressed
concern it would be forced to immediately close its branch as a
result of the sale in violation of federal and state law.
Brixmor emerged as the winning bidder at a two-day auction
conducted in October, beating out rival bidder Key Food Stores
Co-Operative Inc. The company offered $4.655 million for the
assets, according to court filings.
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 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.
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.
The Debtor disclosed total assets of $601,441,108 and total
liabilities of $1,984,459,086 as of the Petition Date.
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 U.S. Trustee for Region 2 appointed seven creditors to serve on
the official committee of unsecured creditors. Pachulski Stang
Ziehl & Jones LLP serves as its counsel, and Zolfo Cooper, LLC as
serves as its financial advisors and bankruptcy consultants.
ATP OIL: Court Denies Diamond Offshore's Bid to Junk Sec.547 Claims
-------------------------------------------------------------------
In a Memorandum Opinion dated October 28, 2015, available at
http://is.gd/ja0UDTfrom Leagle.com, Judge Marvin Isgur of the
United States Bankruptcy Court for the Southern District of Texas,
Houston Division, dismissed with prejudice Rodney Tow's remaining
Section 549 claims against Defendant Bennu Oil & Gas, LLC, and
denied Plaintiff Diamond Offshore Company's Motion to Dismiss the
Trustee's Section 547 claims.
Rodney Tow, Chapter 7 Trustee for ATP Oil & Gas Corporation, has
filed Amended Counterclaims for the avoidance and recovery of
transfers made by ATP to TM and Diamond pursuant to 11 U.S.C.
Sections 547 and 549 related to the conveyance of purported
overriding royalty interests. TM and Diamond, the putative ORRI
Holders, have each filed motions to dismiss each of Tow's claims
under various theories.
Defendant Bennu has filed a motion to enforce the Final Sale Order
and prevent the Trustee from pursuing Section 549 claims sold to
Bennu.
The property at issue in each of Tow's Section 547 claims is the
funds that ATP transferred to each ORRI holder pursuant to the
underlying ORRI instruments during the preference period.
Tow alleges that:
a. Two preferential transfers -- $9,701,526.00 on June 20, 2012
and $7,894,844.00 on July 3, 2012 -- were made by ATP to Diamond
pursuant to the alleged ORRI transaction.
b. A preferential transfer in the amount of $1,031,847.00 was
made to TM on May 31, 2012.
Fact issues remain as to whether these payments constitute
"transfers of an interest of the debtor in property.
The ORRI holders assert that Tow's Section 547 claims should be
dismissed (i) under rule 12(b)(1) because the Trustee lacks
standing and (ii) under rule 12(b)(6) because the Trustee cannot
plead the elements necessary to maintain a cause of action under
Section 547.
The adversary proceedings are DIAMOND OFFSHORE COMPANY, Plaintiff,
v. BENNU OIL & GAS, LLC, Defendant; and TM ENERGY HOLDINGS LLC, GMZ
ENERGY HOLDINGS LLC, AND CLP ENERGY LLC, Plaintiff, v. BENNU OIL &
GAS, LLC Defendant, ADVERSARY NO. 12-03425., 12-03429 (Bankr. S.D.
Tex.).
The bankruptcy case is IN RE: ATP OIL & GAS CORPORATION, CHAPTER 7,
Debtor, CASE NO. 12-36187 (Bankr. S.D. Tex.).
Diamond Offshore Company, Plaintiff, is represented by Paul J.
Dobrowski, Esq. -- pjd@doblaw.com -- Dobrowski LLP, Berry D.
Spears, Esq. -- Fulbright Jaworski L.L.P., Anthony David Weiner,
Esq. -- adw@doblaw.com -- Dobrowski Larkin and Johnson.
Bennu Oil & Gas, LLC, Defendant, represented by Sean B. Davis, Esq.
-- sbdavis@winstead.com -- Winstead PC, Andrew J. Gallo, Esq. --
andrew.gallo@morganlewis.com -- Morgan, Lewis & Bockius LLP.
Rodney Tow, Trustee, represented by Timothy Micah Dortch, Esq. --
Micah.Dortch@cooperscully.com -- Cooper & Scully, P.C., Christopher
David Lindstrom, Esq. -- Christopher.Lindstrom@cooperscully.com --
Cooper Scully PC.
About ATP Oil
Houston, Texas-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused in
the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is
the conflicts counsel. Motley Rice LLC and Fayard & Honeycutt,
APC
serve as special counsel. Opportune LLP is the financial advisor
and Jefferies & Company is the investment banker.
Kurtzman Carson Consultants LLC is the claims and notice agent.
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York
MellonTrust
Co. as agent. ATP's other debt includes $35 million on
convertible
notes and $23.4 million owing to third parties for their shares of
production revenue. Trade suppliers have claims for $147 million,
ATP said in a court filing.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy,
in New York, represents the Creditors Committee as counsel.
A seven-member panel of equity security holders has also been
appointed in the case. Kyung S. Lee, Esq., and Charles M. Rubio,
Esq. of Diamond McCarthy LLP, in Houston, Texas, serve as counsel
to the Equity Committee.
Judge Marvin Isgur of the U.S. Bankruptcy Court for the Southern
District of Texas, Houston Division, issued an order on June 26,
2014, converting ATP Oil & Gas Corporation's Chapter 11 case to
one
under Chapter 7 of the Bankruptcy Code.
AVT INC: Shareholder Leads Capital Raise to Help Chapter 11 Exit
----------------------------------------------------------------
AVT, Inc., on Nov. 9 disclosed that a prominent shareholder in the
company and a distinguished businessman, is leading an effort to
raise capital to help the company exit Chapter 11.
Having been involved with AVT since the company's inception, this
investor has seen the company grow; create exciting automated
solutions and patented technologies; develop innovative system
designs, and lead the industry with a new way of thinking about
traditional vending and self-service retailing.
"I am a huge fan and an ardent supporter of AVT because I have an
understanding of the market and of the company's potential," said
John Knipf. "I've have always been proactive in my approach to
business, and I am looking forward to helping fund AVT's exit
strategy to get out of Chapter 11, and get back to the business of
executing on its business plan, current opportunities, and future
goals."
From the dot.com revolution to the vending explosion with Redbox,
the retailing world has changed dramatically within this generation
-- impacted and updated by new technologies and automation that
engages customers, strengthens brands, and sells products of all
kinds.
About AVT
AVT -- http://www.autoretail.com/-- is a manufacturer of automated
retailing systems and custom vending machines.
AVT, Inc., sought Chapter 11 bankruptcy protection (Bankr. C.D.
Cal. Case No. 15-14464) on May 1, 2015, in Riverside, California.
Judge Mark S Wallace presides over the case. The Debtor tapped
Marc C Forsythe, Esq., at Goe & Forsythe, LLP, in Irvine,
California, as counsel.
The Debtor estimated $1 million to $10 million in assets and debt.
BANKRATE INC: Moody's to Retain B1 CFR on Sale of Insurance Unit
----------------------------------------------------------------
Moody's Investors Service said Bankrate, Inc.'s B1 Corporate Family
Rating and stable outlook are not impacted by the recent
announcement that the company will sell its insurance segment for a
$140 million cash payment at closing and an additional $25 million
on the closing date's second anniversary.
The principal methodology used in this rating was Global Publishing
Industry published in December 2011.
Headquartered in New York, NY, Bankrate, Inc. is an Internet media
company that publishes, aggregates and distributes personal
finance, consumer banking and editorial content on its proprietary
websites across various verticals including mortgages, deposits,
insurance, credit cards, auto loans, home equity loans and money
market accounts.
CAESARS ENTERTAINMENT: Agrees to 4th Extension of Challenge Period
------------------------------------------------------------------
The statutory claimholders' committee, certain beneficial holders,
or the investment advisors or managers for certain beneficial
holders, of first lien notes issued by Caesars Entertainment
Operating Company, Inc., et al., and each of the Debtors entered
into a Fourth Stipulation extending the challenge period.
Pursuant to the said Fourth Stipulation, the First Lien Bank
Lenders and the First Lien Noteholders have agreed to extend the
Challenge Period and the Challenge Period Termination Date, solely
for the Unsecured Committee, in respect of any potential Challenges
to the LBO, the debt that was used to finance the LBO debt, all
issuances of debt thereafter, and any refinancings of the LBO Debt
or the Follow-On Debt.
The Challenge Period and the Challenge Period Termination Date,
solely for the Unsecured Committee, in respect of any potential
Specified Challenges are each extended to 30 days after the date
upon which Richard J. Davis, the Court-appointed Examiner, delivers
his final written report to the Court with respect to his
conclusions regarding the LBO or otherwise provides public notice
of the termination of his investigation of the LBO; provided,
however, any Challenges that are preserved will remain preserved
through confirmation of a chapter 11 plan in accordance with, and
as limited by, the terms of the Final Cash Collateral Order.
Caesars Entertainment Operating Company, Inc., et al., are
represented by:
James H.M. Sprayregen, Esq.
David R. Seligman, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle
Chicago, Illinois 60654
Tel.: 312 862-2000
Fax: 312 862-2200
Email: james.sprayregen@kirkland.com
david.seligman@kirkland.com
-- and --
Paul M. Basta, Esq.
Nicole L. Greenblatt, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022-4611
Tel.: (212) 446-4800
Fax: (212) 446-4900
Email: paul.basta@kirkland.com
nicole.greenblatt@kirkland.com
Statutory Unsecured Claimholders' Committee is represented by:
Martin J. Bienenstock, Esq.
Philip M. Abelson, Esq.
Vincent Indelicato, Esq.
Proskauer Rose LLP
Eleven Times Square
New York, New York 10036
Tel: 212 969-3000
Fax: 212 969-2900
Email: pabelson@proskauer.com
mbienenstock@proskauer.com
vindelicato@proskauer.com
-- and --
Jeff J. Marwil, Esq.
Mark K. Thomas, Esq.
Paul V. Possinger, Esq.
Brandon W. Levitan, Esq.
Proskauer Rose LLP
70 W. Madison St.
Chicago, Illinois 60602-4342
Tel: 312 962-3550
Fax: 312 962-3551
Email: jmarwil@proskauer.com
mthomas@proskauer.com
pposinger@proskauer.com
blevitan@proskauer.com
First Lien Bank Lenders are represented by:
Brian L. Shaw
SHAW FISHMAN GLANTZ & TOWBIN LLC
321 N. Clark Street, Suite 800
Chicago, IL 60654
Tel: (312) 541-0151
-- and --
Kristopher M. Hansen, Esq.
Kenneth Pasquale, Esq.
Erez E. Gilad, Esq.
Jonathan D. Canfield, Esq.
STROOCK & STROOCK & LAVAN LLP
180 Maiden Lane
New York, NY 10038
Tel: (212) 806-5400
First Lien Noteholders are represented by:
Mark A. Berkoff, Esq.
Robert Radasevich, Esq.
Nicholas M. Miller, Esq.
NEAL, GERBER & EISENBERG LLP
Two North LaSalle Street, Suite 1700
Chicago, IL 60602-3801
Tel: (312) 269-8000
-- and --
Kenneth H. Eckstein, Esq.
Douglas H. Mannal, Esq.
Daniel M. Eggermann, Esq.
David E. Blabey Jr., Esq.
KRAMER LEVIN NAFTALIS & FRANKEL LLP
1177 Avenue of the Americas
New York, NY 10036
Tel: (212) 715-9100
-- and --
Peter A. Siddiqui, Esq.
KATTEN MUCHIN ROSENMAN LLP
525 West Monroe Street
Chicago, IL 60661-3693
Tel: (312) 902-5200
-- and --
Craig A. Barbarosh, Esq.
David A. Crichlow, Esq.
Karen B. Dine, Esq.
KATTEN MUCHIN ROSENMAN LLP
575 Madison Avenue
New York, NY 10022-2585
Tel: (212) 940-8800
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 reason.
CAESARS ENTERTAINMENT: Has Until May 15 to Confirm Ch. 11 Plan
--------------------------------------------------------------
Certain beneficial holders, or the investment advisors or managers
for certain beneficial holders, of first lien bank debt issued by
Caesars Entertainment Operating Company, Inc., et al., entered into
a stipulation with the Debtors extending milestones under the Cash
Collateral Order.
The First Lien Bank Lenders agree that the date by which the
Debtors will have obtained entry by the Court of an order approving
the Disclosure Statement and an order approving solicitation
procedures in relation to the Plan and Disclosure Statement will be
extended to the date that is the earlier of (x) February 15, 2016
and (y) 60 days after the filing with the Court of the final report
in respect of the investigation.
The First Lien Bank Lenders agree that the date by which the
Debtors will have obtained entry by the Court of the Confirmation
Order will be extended to the date that is the earlier of (x) May
15, 2016 and (y) 90 days after the Court's approval of the
Disclosure Statement.
The First Lien Bank Lenders agree that the First Lien Credit
Parties' Outside Date will be extended to the date that is the
earlier of (x) July 15, 2016 and (y) 60 days after the Confirmation
Order has been entered by the Court.
Caesars Entertainment Operating Company, Inc., et al. are
represented by:
James H.M. Sprayregen, Esq.
David R. Seligman, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle
Chicago, Illinois 60654
Tel.: 312 862-2000
Fax: 312 862-2200
Email: james.sprayregen@kirkland.com
david.seligman@kirkland.com
-- and --
Paul M. Basta, Esq.
Nicole L. Greenblatt, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022-4611
Tel.: (212) 446-4800
Fax: (212) 446-4900
Email: paul.basta@kirkland.com
nicole.greenblatt@kirkland.com
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 reason.
CAESARS ENTERTAINMENT: Indenture Trustee Seeks to Sue Guarantors
----------------------------------------------------------------
Wilmington Trust, National Association, as Successor Indenture
Trustee for the 10.75% Senior Unsecured Notes issued by Caesars
Entertainment Operating Company, Inc., filed a motion seeking
authority from the United States Bankruptcy Court for the Northern
District of Illinois, Eastern Division, to commence, prosecute, and
settle certain causes of action.
The Indenture Trustee asserted that the Court should grant it
standing to commence, prosecute, and settle a proposed action. The
10.75 Notes Trustee seeks Court authorization to pursue certain
causes of action on behalf of the Subsidiary Guarantors. While the
Official Committee of Unsecured Creditors will be seeking standing
for certain claims, it may be a less effective advocate for the
Subsidiary Guarantors in challenging the Subject Stipulations
because it serves as a fiduciary for general unsecured creditors of
CEOC as well as the Subsidiary Guarantors.
The interests of these two groups will diverge with respect to the
issues raised in the Proposed Complaint, insofar as general
unsecured creditors whose recovery derives primarily from CEOC
would benefit from allowing First Lien Claims against the
Subsidiary Guarantors and a corresponding reduction in First Lien
Claims against CEOC, the Indenture Trustee asserted. As a result,
the 10.75% Notes Trustee is uniquely positioned to serve the
interests of unsecured creditors of the Subsidiary Guarantors, the
Indenture Trustee said.
The Debtors, Credit Suisse AG, Cayman Islands Branch, the Ad Hoc
Committee of First Lien Bank Lenders, and the Ad Hoc Committee of
First Lien Noteholders and UMB Bank, N.A., object to the motion.
The Debtors contended that they have justifiably chosen not to
presently litigate the Challenges, in light of their resolutions
with their first lien lenders in the cash collateral order and the
Debtors' two restructuring support agreements. The Debtors object
to the relief requested by the Standing Motions and
Claim Objections and respectfully request that the Court continue
the Standing Motions and Claim Objections for a further status
update on the parties’ progress, before either further continuing
these matters or setting a briefing schedule.
Credit Suisse asserted that any standing should be limited to one
estate representative -- either the Committee or the 10.75% Trustee
-- but not both. Permitting multiple parties to expend estate
resources on such similar claims, even if they would potentially
provide value to the estates, which they would not, would be
unwarranted and inefficient, Credit Suisse further asserted.
The First Lien Bank Lenders told the Court that they have
previously offered -- and remains prepared -- to extend the
Challenge deadline for each of the Challenges through confirmation,
but both the UCC and the 10.75% Notes Trustee have declined, opting
instead to shoot first and ask questions later.
The Ad Hoc Committee and UMB Bank asserted that the Trustee
Standing motion is duplicative and unnecessary.
The bankruptcy court scheduled the filing of responses on or before
November 20, 2015. In addition, the Reply is due on or before
December 4, 2015. Lastly, the status hearing will be scheduled for
hearing on January 20, 2016 at 1:30 p.m.
Caesars Entertainment Operating Company, Inc., et al. are
represented by:
James H.M. Sprayregen, Esq.
David R. Seligman, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle
Chicago, Illinois 60654
Tel.: 312 862-2000
Fax: 312 862-2200
Email: james.sprayregen@kirkland.com
david.seligman@kirkland.com
-- and --
Paul M. Basta, Esq.
Nicole L. Greenblatt, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022-4611
Tel.: (212) 446-4800
Fax: (212) 446-4900
Email: paul.basta@kirkland.com
nicole.greenblatt@kirkland.com
Wilmington Trust, National Association, as successor Indenture
Trustee is represented by:
Eric N. Macey, Esq.
Stephen J. Siegel, Esq.
Julie Johnston-Ahlen, Esq.
NOVACK AND MACEY LLP
100 North Riverside Plaza
Chicago, IL 60606
Tel: (312) 419-6900
Fax: (312) 419-6928
-- and --
J. Christopher Shore, Esq.
Harrison L. Denman, Esq.
WHITE & CASE LLP
1155 Avenue of the Americas
New York, NY 10036
Tel: (212) 819-8200
Fax: (212) 354-8113
-- and --
Thomas E Lauria, Esq.
Jason Zakia, Esq.
WHITE & CASE LLP
Southeast Financial Center, Suite 4900
200 South Biscayne Blvd.
Miami, FL 33131
Tel: (305) 371-2700
Fax: (305) 358-5744
-- and --
Seth H. Lieberman, Esq.
Patrick Sibley, Esq.
PRYOR CASHMAN LLP
7 Times Square
New York, NY 10036
Tel: (212) 421-4100
Fax: (212) 326-0806
The Ad Hoc Committee of First Lien Noteholders and UMB Bank, N.A.
are represented by:
Mark A. Berkoff, Esq.
Robert Radasevich, Esq.
Nicholas M. Miller, Esq.
NEAL, GERBER & EISENBERG LLP
Two North LaSalle Street, Suite 1700
Chicago, IL 60602-3801
Tel: (312) 269-8000
-- and --
Kenneth H. Eckstein, Esq.
Douglas H. Mannal, Esq.
Daniel M. Eggermann, Esq.
David E. Blabey Jr., Esq.
KRAMER LEVIN NAFTALIS & FRANKEL LLP
1177 Avenue of the Americas
New York, NY 10036
Tel: (212) 715-9100
-- and --
Peter A. Siddiqui, Esq.
KATTEN MUCHIN ROSENMAN LLP
525 West Monroe Street
Chicago, IL 60661-3693
Tel: (312) 902-5200
-- and --
Craig A. Barbarosh, Esq.
David A. Crichlow, Esq.
Karen B. Dine, Esq.
KATTEN MUCHIN ROSENMAN LLP
575 Madison Avenue
New York, NY 10022-2585
Tel: (212) 940-8800
The Ad Hoc Bank Lender Committee is represented by:
Brian L. Shaw
SHAW FISHMAN GLANTZ & TOWBIN LLC
321 N. Clark Street, Suite 800
Chicago, IL 60654
Tel: (312) 541-0151
-- and --
Kristopher M. Hansen, Esq.
Kenneth Pasquale, Esq.
Erez E. Gilad, Esq.
Jonathan D. Canfield, Esq.
STROOCK & STROOCK & LAVAN LLP
180 Maiden Lane
New York, NY 10038
Tel: (212) 806-5400
Credit Suisse AG, Cayman Islands Branch (First Lien Agent) is
represented by:
Richard M. Bendix, Esq.
Maria A. Diakoumakis, Esq.
10 S. Wacker Drive, Suite 2300
Chicago, IL 60606
Tel: (312) 876-1700
Fax: (312) 876-1155
Email: rbendix@dykema.com
mdiakoumakis@dykema.com
-- and --
Joel H. Levitin, Esq.
Kevin J. Burke, Esq.
Richard A. Stieglitz Jr., Esq.
CAHILL GORDON & REINDEL LLP
Eighty Pine Street
New York, NY 10005
Tel: (212) 701-3000
Fax: (212) 269-5420
Email: jlevitin@cahill.com
rstieglitz@cahill.com
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 reason.
CAESARS ENTERTAINMENT: Kirkland Blasts Creditors Renewed DQ Bid
---------------------------------------------------------------
Carmen Germaine at Bankruptcy Law360 reported that Kirkland & Ellis
LLP has knocked a renewed bid by junior bondholders of the bankrupt
operating unit of Caesars Entertainment Corp. to block the firm
from representing the debtor in its Chapter 11 case, denying that a
prominent attorney with the firm concealed a potential conflict.
Kirkland released a statement Friday denying claims of the junior
bondholders committee that prominent Kirkland restructuring
attorney James Sprayregen concealed conflicts that should have
disqualified the firm from representing Caesars Entertainment
Operating Co. in its Chapter 11 proceedings.
In a separate report, the Wall Street Journal reported that
Caesars Entertainment Operating Co. secured a bankruptcy judge's
permission to sell its Harrah's Tunica Hotel & Casino in
Mississippi as part of its chapter 11 restructuring.
Bankruptcy Judge A. Benjamin Goldgar signed off on the shuttered
casino's sale, for $3 million, to TJM Properties. Caesars canceled
last week's auction for the property after no rival bidders stepped
forward to challenge TJM Properties' offer. The buyer, which owns
hotels and senior-living properties, acquired another closed
casino, the Atlantic Club Hotel & Casino in Atlantic City, N.J.,
for $13.5 million last year.
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 reason.
CAESARS ENTERTAINMENT: Seeks Approval of CPLV, FinCEN Settlement
----------------------------------------------------------------
Caesars Entertainment Operating Company, Inc., et al., ask the
United States Bankruptcy Court for Northern District of Illinois,
Eastern Division, to approve a settlement between Debtor Desert
Palace, Inc., d/b/a Caesars Palace Las Vegas, and the U.S.
Department of the Treasury Financial Crimes Enforcement Network.
According to the Debtors, FinCEN could have assessed a civil
penalty in excess of $30 million, significantly greater than the $8
million penalty negotiated in the Consent Order. FinCEN has also
agreed to a general unsecured claim rather than litigating over
priority or dischargeability issues. Moreover, FinCEN could have
imposed additional administrative compliance measures to those
negotiated in the Consent Order, instead, the resolution negotiated
in the Consent Order appropriately balances the remedial purpose of
the Consent Order against the practical realities of CPLV's ability
to comply with its undertakings under the Consent Order in a
reasonably efficient and cost-effective manner, the Debtors tell
the Court.
CPLV's entry into and performance under the Consent Order
represents a sound exercise of business judgment and is in the best
interest of CPLV's estate, the Debtors assert. The Consent Order
falls well within the range of reasonable litigation outcomes as to
the issues encompassed by the Consent Order and represents an
efficient resolution of FinCEN's claim in a manner that avoids
costly litigation and potential disruption to CPLV's business
operations and restructuring efforts, the Debtors further assert.
Caesars Entertainment Operating Company, Inc., et al. are
represented by:
James H.M. Sprayregen, Esq.
David R. Seligman, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle
Chicago, Illinois 60654
Tel.: 312 862-2000
Fax: 312 862-2200
Email: james.sprayregen@kirkland.com
david.seligman@kirkland.com
-- and --
Paul M. Basta, Esq.
Nicole L. Greenblatt, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022-4611
Tel.: (212) 446-4800
Fax: (212) 446-4900
Email: paul.basta@kirkland.com
nicole.greenblatt@kirkland.com
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 reason.
CHANNEL CONSTRUCTION: Attorney's Fees Reduced to $47K
-----------------------------------------------------
In a Memorandum dated October 28, 2015, available at
http://is.gd/M5mPTLfrom Leagle.com, Judge Herb Ross of the United
States Bankruptcy Court for the District of Alaska reduced the
attorney fees on McGee Law Offices' the fourth application to
adjust for the overstatements it perceives on the second, third and
fourth application to $47,483.
The court found overstatements in MLO's second, third and fourth
fee applications totalling $4,425. To allow MLO due process to
contest the analysis, MLO is given time to object to the court's
reduction. MLO may request a hearing if it desires one.
The case is In re CHANNEL CONSTRUCTION, INC., Chapter 11, Debtor,
CASE NO. J14-00103-HAR (Bankr. D. Ala.).
Channel Construction, Inc., Debtor, is represented by Cabot C.
Christianson, Esq. -- Law Offices of Cabot Christianson, P.C.,
Terence K McGee, Esq. -- McGee Law Offices, PLLC.
Channel Construction, Inc., based in Juneau, Alaska, filed for
Chapter 11 bankruptcy (Bankr. D. Alaska Case No. 14-00103) on
March 31, 2014. Judge Herbert A. Ross oversees the case. Cabot
C. Christianson, Esq., at Christianson & Spraker, serves as the
Debtor's counsel. The Debtor estimated $1 million to $10 million
in both assets and liabilities in its petition. A list of the
Debtor's 29 largest unsecured creditors is available for free at
http://bankrupt.com/misc/akb14-103.pdf
COLT DEFENSE: Wins Approval of Disclosure Statement
---------------------------------------------------
Colt Defense LLC on Nov. 10 announced the approval of the
Disclosure Statement for its Second Amended Plan of Reorganization
by the U.S. Bankruptcy Court for the District of Delaware. The
completion of this important milestone in Colt's Chapter 11 cases
will allow creditors to vote on the Plan, which is fully consensual
and embodies a global settlement of all outstanding issues in the
cases, as soon as next week.
The Plan to be voted on reflects a consensus reached among Colt's
key stakeholders, including a consortium of Colt's secured lenders,
Morgan Stanley as the lender under Colt's pre-petition and
post-petition secured term loan facilities, the official committee
of unsecured creditors appointed in Colt's bankruptcy case, Sciens
Capital Management and the landlord at Colt's West Hartford
facility. If approved, the Plan will allow Colt to raise
substantial new equity and debt to meet its business and capital
needs, restructure its pre-bankruptcy debts, provide meaningful
recoveries to creditors and remain in its existing production
facility in West Hartford. Approval of the Disclosure Statement
will let creditors vote on the Plan. If the Plan is approved the
Company plans to emerge from Chapter 11 before the end of the
year.
"The approvals we received [Tues]day represent a significant
achievement and another important step forward for Colt as well as
its employees, customers, suppliers and vendors," said Dennis
Veilleux, Chief Executive Officer of Colt Defense LLC. "Thanks to
the dedication and diligent efforts of all of our stakeholders, we
are on a path to emerge from restructuring by the end of this year
on the firm footing we need to execute our turnaround plan,
supported by financing that reflects a spirit of cooperation and
shared confidence in Colt as an iconic American brand."
The Company filed the Second Amended Plan and related Disclosure
Statement on November 10, 2015. A copy of the Plan and Disclosure
Statement is available at http://www.kccllc.net/coltdefense
Votes on the Plan must be received by the Company's voting agent,
Kurtzman Carson Consultants LLC, by December 7, 2015, unless the
deadline is extended. Solicitation materials are expected to be
mailed to all creditors entitled to vote on the Plan in the coming
days. A hearing to consider confirmation of the Plan is currently
scheduled for December 16, 2015.
This press release is for information purposes only and is not a
solicitation to accept or reject the Plan. The Disclosure
Statement, along with ballots and other solicitation materials,
will be distributed directly to those creditors of the Company who
are entitled to vote to accept or reject the Plan pursuant to the
Disclosure Statement.
Perella Weinberg Partners L.P. is acting as financial advisor of
the Company, Mackinac Partners LLC is acting as restructuring
advisor of the Company and O'Melveny & Myers LLP is the Company's
legal counsel.
For access to documents filed in the United States Bankruptcy Court
for the District of Delaware and other general information about
these Chapter 11 cases, please visit:
http://www.kccllc.net/coltdefense
About Colt Defense
Colt Defense LLC is one of the world's oldest and most iconic
designers, developers, and manufacturers of firearms for military,
law enforcement, personal defense, and recreational purposes and
was founded over 175 years ago by Samuel Colt, who patented the
first commercial successful revolving cylinder firearm in 1836 and
began supplying U.S. and international military customers with
firearms in 1847. Colt is incorporated in Delaware and
headquartered in West Hartford, Connecticut.
In 1992, Colt Manufacturing Company, then the principal operating
subsidiary, filed chapter 11 petitions (Bankr. D. Conn.). An
investment by Zilkha & Co. allowed CMC to confirm a chapter 11 plan
and emerge from Bankruptcy in 1994.
Sometime after 1994, majority ownership of the Company Transitioned
from Zilkha & Co. to Sciens Capital Management.
Colt Holding Company LLC and nine affiliates, including Colt
Defense LLC, on June 14, 2015, filed voluntary petitions (Bankr. D.
Del. Lead Case No. 15-11296) for relief under Chapter 11 of the
Bankruptcy Code to pursue a sale of the assets as a going concern.
Colt Defense estimated $100 million to $500 million in assets and
debt.
On June 16, 2015, the Court directed the joined administration of
the assets.
The Debtors tapped Richards, Layton & Finger, P.A., and O'Melveny &
Myers LLP, as attorneys, and Kurtzman Carson Consultants LLC as
claims and noticing agent. Perella Weinberg Partners L.P. is
acting as financial advisor of the Company, and Mackinac Partners
LLC is acting as its restructuring advisor.
Wilmington Savings Fund Society, FSB, as agent under the $13.3
million Term DIP Loan Agreement, is represented by Pryor Cashman
LLP's Eric M. Hellige, Esq.; and Willkie Farr & Gallagher LLP's
Leonard Klingbaum, Esq.
Cortland Capital Market Services LLC, as agent under the $6.67
million Senior DIP Credit Agreement, is represented by Holland &
Knight LLP's Joshua M. Spencer, Esq.; Stroock & Stroock & Lavan
LLP's Brett Lawrence, Esq.; and Osler, Hoskin & Harcourt LLP's
Richard Borins, Esq., and Tracy Sandler, Esq.
The U.S. Trustee for Region 3 appointed five creditors of Colt
Defense Inc. and its affiliates to serve on the official committee
of unsecured creditors. MagPul Industries Corp. has resigned from
the committee leaving only four Committee members.
Sciens Capital is represented by Skadden, Arps, Slate, Meagher &
Flom LLP's Anthony W. Clark, Esq., and Jason M. Liberi, Esq.
* * *
Colt's equity sponsor, Sciens Capital Management, has agreed to act
as a stalking horse bidder in a proposed asset sale. The Debtors
called off the bankruptcy auction after no potential buyers emerged
by an Oct. 16, 2015 deadline.
The Debtors on Oct. 9 filed a proposed plan of reorganization
premised on a $50 million exit financing facility from
private-equity owner Sciens Capital Management, LLC, Fidelity
National Financial Inc., Newport Global Advisors LP, and certain
other lenders. The Plan secures options for the Company to
continue operations in West Hartford, Connecticut on a long-term
basis.
COMMUNITY HEALTH: S&P Affirms 'B+' CCR & Revises Outlook to Neg.
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on Franklin, Tenn.-based acute-care hospital operator
Community Health Systems Inc. and revised the rating outlook to
negative from stable. S&P's issue-level ratings on Community are
unchanged.
"The outlook revision to negative follows two quarters of
weaker-than-expected operating performance," said Standard & Poor's
credit analyst Shannan Murphy. Relative to other acute-care
hospital operators, Community has experienced slower growth in
adjusted admissions, in part reflecting ongoing challenges at
hospitals acquired from Health Management Associates (HMA) in early
2014. In addition, the company experienced increases in staffing
and supply costs in the third quarter, resulting in about 150 basis
points of margin deterioration on a sequential basis. At the same
time, in response to a severe stock price decline, the company
announced a $150 million share repurchase plan that S&P now expects
the company to initiate over the next few weeks and which it had
not previously incorporated into its forecasts. Given these
challenges, we are now less confident in our prior forecast that
Community will reduce leverage to the mid-5x range over the next
few quarters and continue to generate about $400 million to $500
million in annual discretionary cash flow.
The negative rating outlook reflects S&P's view that the company's
current operating challenges may take some time to resolve, and
financial policies may be somewhat more aggressive than S&P
previously anticipated. This gives S&P less confidence that
Community will be able to reduce leverage to the mid-5x range over
the next few quarters and generate substantial, stable
discretionary cash flows over time.
If S&P believes that the company is likely to sustain leverage over
6x for an extended period of time, either due to margin pressures
or to more aggressive financial policies, S&P could lower the
rating. Under this scenario, S&P would expect that the company's
annual discretionary cash flows would be likely to be limited to
$350 million or less per year, a level that S&P would likely view
as more consistent with 'B' (rather than 'B+') rated peers.
S&P could revise the outlook to stable if Community achieves some
success in driving improvement across its portfolio, as measured by
improving gross margins and leverage declining into the high-5x
area. Under this scenario, S&P would likely expect discretionary
cash flow to be comfortably above $400 million per year.
COMMUNITY HOME: Court Grants Interim Approval of Atty Fees
----------------------------------------------------------
In a Memorandum Opinion dated October 27, 2015, available at
http://is.gd/AhlS6wfrom Leagle.com, Judge Edward Ellington of the
United States Bankruptcy Court for the Southern District of
Mississippi granted in part and disallowed in part the First
Application for Compensation for the Period of January 2, 2014
through July 31, 2014, and Reimbursement of Expenses by the Law
Firm of Jones Walker LLP as Counsel to Kristina M. Johnson, Trustee
of the Estate of Community Home Financial Services, Inc.
Judge Ellington, based on the exceptional or unique circumstances
in existence at the time the Trustee was appointed, allowed JW to
be compensated for the non-legal time entries. However, the Court
is not finding that the exceptional or unique circumstances will
remain in existence for the entire tenure of the Trustee's
appointment.
Judge Ellington also held that JW professionals and
Non-Professionals to be compensated for performing the Trustee's
statutory duties without charging the amount against or subtracting
from the Trustee's Comp. Since this is an interim fee application,
the issue of whether to charge against the Trustee's Comp will be
revisited by the Court when the final fee applications and the
final application for Trustee's Comp are filed.
As for the hourly rates of attorneys and Non-Professionals, the
Court finds that since this case is not a national or regional
case, out-of-town hourly rates are not justified.
The case is IN RE: COMMUNITY HOME FINANCIAL SERVICES, INC., Chapter
11, CASE NO. 1201703EE (Bankr. S.D. Miss.).
Kristina M. Johnson, Trustee, represented by Laura F. Ashley, Esq.
-- lashley@joneswalker.com -- Jones Walker LLP, Jeffrey Ryan
Barber, Esq. -- jbarber@joneswalker.com -- Jones Walker LLP,
Stephanie Bentley McLarty, Esq. -- smclarty@joneswalker.com --Jones
Walker LLP, Mark Alan Mintz, Esq. -- mmintz@joneswalker.com --
Jones Walker LLP, John D. Moore, Esq. -- john@johndmoorepa.com,
Melanie T. Vardaman, Esq.
About Community Home
Community Home Financial Services, Inc., filed a Chapter 11
petition (Bankr. S.D. Miss. Case No. 12-01703) on May 23, 2012.
The petition was signed by William D. Dickson, president.
Community Home Financial is a specialty finance company located in
Jackson, Mississippi, providing contractors with financing for
their customers. CHFS operates from one central location
providing financing through its dealer network throughout 25
states, Alabama, Delaware, and Tennessee. The Debtor scheduled
$44.9 million in total assets and $30.3 million in total
liabilities. Judge Edward Ellington presides over the case.
The Debtor was first represented by Roy H. Liddell, Esq., and
Jonathan Bissette, Esq., at Wells, Marble, & Hurst, PPLC as
Chapter 11 counsel. Wells Marble was terminated Nov. 13, 2013.
The Debtor is now being represented by Derek A. Henderson, Esq.,
in Jackson, Miss. In 2013, the Debtor sought to employ David
Mullin, Esq., at Mullin Hoard & Brown LLP, as special counsel.
On Jan. 9, 2014, Kristina M. Johnson was appointed as Chapter 11
Trustee for the Debtor. Jones Walker LLP serves as counsel to the
Chapter 11 trustee, while Stephen Smith, C.P.A., acts as
accountant.
* * *
On Aug. 8, 2013, the Court approved the Disclosure Statement
explaining the Debtor's Plan of Reorganization dated Jan. 29,
2013.
In the first quarter of 2014, the Court entered an order holding
in abeyance the (i) confirmation of the Debtor's Chapter 11 Plan;
and (ii) the objection and amended objection to the confirmation
of
Plan pending further Court order.
COMSTOCK RESOURCES: S&P Affirms 'CCC' Rating on 7.75% Sr. Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'CCC'
issue-level ratings on U.S.-based exploration & production company
Comstock Resources Inc.'s 7.75% senior unsecured notes due 2019 and
9.5% senior unsecured notes due 2020 (recovery ratings: '6').
Comstock recently announced that during the first nine months of
the year, it repurchased about $101 million in combined principal
amount of the 2019 and 2020 senior unsecured notes for about
$38 million. Comstock made the secondary market repurchases on the
open market.
The 'B-' corporate credit rating on Comstock and stable outlook are
unchanged. The 'B-' corporate credit rating reflects S&P's
assessment of the company's business risk profile as "vulnerable"
and its financial risk profile as "highly leveraged," based on
S&P's criteria. There is also no change to S&P's 'B' issue-level
rating or '2' recovery rating on the company's senior secured
debt.
RATINGS LIST
Comstock Resources Inc.
Corporate credit rating B-/Stable/--
Ratings Affirmed
Comstock Resources Inc.
Sr unsecd 7.75% notes due 2019 CCC
Recovery rating 6
Sr unsecd 9.5% notes due 2020 CCC
CTI BIOPHARMA: Incurs $32.6 Million Net Loss in Third Quarter
-------------------------------------------------------------
CTI Biopharma Corp. filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $32.6 million on $964,000 of total revenues for the three months
ended Sept. 30, 2015, compared to net income of $4.60 million on
$39.5 million of total revenues for the same period a year ago.
For the nine months ended Sept. 30, 2015, the Company recorded a
net loss of $93.8 million on $4.79 million of total revenues
compared to a net loss of $51.8 million on $42.3 million of total
revenues for the same period during the prior year.
As of Sept. 30, 2015, the Company had $63.13 million in total
assets, $90.64 million in total liabilities and a $27.51 million
total shareholders' deficit.
"We are focused on preparing our NDA submission for pacritinib and
are on track to submit our application to the FDA this quarter,"
said James A. Bianco, M.D., CTI BioPharma's president and CEO. "We
also remain committed to completing the second Phase 3 trial of
pacritinib, PERSIST-2, which we believe could serve as a
post-approval confirmatory trial in the event our NDA application
is accepted and approved under accelerated approval. Additionally,
we look forward to upcoming data presentations of pacritinib and
tosedostat studies at the ASH Annual Meeting in December."
As of Sept. 30, 2015, cash and cash equivalents totaled $46.4
million, compared to $70.9 million as of Dec. 31, 2014. Subsequent
to Sept. 30, 2015, the Company received approximately $46.5 million
in net proceeds from an underwritten public offering in October
2015.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/YhrxRd
About CTI BioPharma
CTI BioPharma Corp. (NASDAQ and MTA: CTIC) --
http://www.ctibiopharma.com/-- formerly known as Cell
Therapeutics, Inc., is a biopharmaceutical company focused on
the acquisition, development and commercialization of novel
targeted therapies covering a spectrum of blood-related cancers
that offer a unique benefit to patients and healthcare providers.
The Company has a commercial presence in Europe and a late-stage
development pipeline, including pacritinib, CTI's lead product
candidate that is currently being studied in a Phase 3 program for
the treatment of patients with myelofibrosis. CTI BioPharma is
headquartered in Seattle, Washington, with offices in London and
Milan under the name CTI Life Sciences Limited.
CTI Biopharma reported a net loss attributable to common
shareholders of $96 million in 2014, compared with a net loss
attributable to common shareholders of $49.6 million in 2013.
CULLMAN REGIONAL: Fitch Affirms 'BB+' Rating on $61.2MM Rev. Bonds
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Fitch Ratings has affirmed the 'BB+' rating on the following Health
Care Authority of Cullman County (AL) bonds issued on behalf of
Cullman Regional Medical Center (CRMC):
-- $61.2 million revenue bonds, series 2009A.
The Rating Outlook is revised to Positive from Stable.
SECURITY
The bonds are secured by a pledge of revenues, mortgage, and a debt
service reserve fund.
KEY RATING DRIVERS
OPERATIONAL TURNAROUND: The revision of the Outlook to Positive is
driven by CRMC's significant year-over-year (yoy) operating
improvement over the last four fiscal years. CRMC's operating
margin of 4.2% in FY2015 was very much improved from negative 5.2%
in 2012. The improvement is driven by CRMC's revenue cycle and cost
containment initiatives, solid volumes, and low unemployment rate
in the service area.
GROWING LIQUIDITY: CRMC's liquidity position was solid with 209.8
days cash on hand (DCOH) at FYE2015 (ended June 30, 2015), which
compares well to Fitch's 'BBB' median of 161.5 days. Cushion ratio
of 9.0x and cash-to-debt of 85.5% at FYE 2015 were much improved
from prior years and are approaching Fitch's investment-grade
medians of 11.1x and 89.5%, respectively.
SIGNIFICANT LEVERAGE: CRMC's leverage remains significant given its
modest revenue base, with maximum annual debt service (MADS) equal
to 5.8% of FY2015 revenues, unfavorable to Fitch's 'BBB' median of
3.6%. Somewhat offsetting CRMC's leverage is its strong debt
service coverage of 2.9x in FY2015.
STRONG MARKET POSITION: CRMC's designation as a sole community
provider hospital and 67% Medicare market share in its primary
service area (PSA) allow CRMC to benefit from strong volumes,
favorable payor contracts, and enhanced Medicare reimbursement.
RATING SENSITIVITIES
MODERATION OF DEBT BURDEN: Upward rating movement is possible,
should Cullman Regional Medical Center's debt burden moderate
further, which would require a sustained trajectory of improving
operations and y-o-y cash growth.
CREDIT PROFILE
CRMC is an acute care general hospital with 145 licensed beds (115
operational), located in Cullman, AL, which is 50 miles north of
Birmingham. CRMC is designated as a Level III trauma center and is
designated as a sole community provider. CRMC had total operating
revenues of $100.7 million in FY 2015.
OPERATIONAL TURNAROUND
CRMC's $4.2 million in income from operations in 2015 was
significantly improved from a $4.8 million loss in 2012. Management
attributes the y-o-y operating improvement to its revenue cycle
initiatives, cost containment strategies, solid volume trends, and
favorable area demographics which account for a low unemployment
rate.
CRMC's $2.2 million in income from operations through the first
quarter of FY2016 (ended Sept. 30, 2015) equated to strong 8.3%
operating and 17.4% operating EBITDA margins. Management is
expecting to finish FY2016 with approximately $16 million in
operating EBITDA, a $2 million improvement over FY2015, which Fitch
views as feasible given the current operating trajectory.
SOLID LIQUIDITY
CRMC's unrestricted liquidity grew by 73% from FYE2012 to Sept. 30,
2015, resulting in an unrestricted cash and investments balance of
$52.5 million. CRMC's 210.9 DCOH, compared well to Fitch's 'BBB'
median of 161.5 days, while cushion ratio of 9.0x and cash-to-debt
of 84% were improved from prior years, but were slightly below
Fitch's 'BBB' respective medians of 11.1x and 89.5%. Fitch would
expect CRMC's unrestricted liquidity position to continue improving
over the medium term given its trend of improved operating
profitability and ability to grow its balance sheet over the last
four years.
SIGNIFICANT LEVERAGE
CRMC's annual debt service is level through maturity in 2036, with
MADS of approximately $5.8 million equating to 5.8% of FY2015
revenues, unfavorable compared to Fitch's 'BBB' median of 3.6%.
Leverage has moderated slightly from FY2012 when MADS as a percent
of revenue was 6.3%. However, stronger debt service coverage of
2.9x in FY2015 , improved from 1.3x in 2012, somewhat offset CRMC's
leverage position, and no additional debt is expected at this
time.
DEBT PROFILE
All of CRMC's outstanding debt is fixed rate. CRMC has one basis
swap outstanding, with no collateral posting requirements.
CULLMAN REGIONAL: Fitch Affirms 'BB+' Rating on 2016 Rev. Bonds
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Fitch Ratings has assigned a 'BB/RR4' rating to HCA Inc.'s (HCA)
senior unsecured notes offering. Fitch expects that the company
will apply the proceeds of this offering to refinance existing
senior unsecured notes of HCA Inc. that mature in 2016. The Rating
Outlook is Stable. The ratings apply to $29.8 billion of debt
outstanding at Sept. 30, 2015.
KEY RATING DRIVERS
Industry-Leading Financial Flexibility: HCA's financial flexibility
has improved significantly in recent years as a result of organic
growth in the business as well as proactive management of the
capital structure. The company has industry-leading operating
margins and generates consistent and ample discretionary FCF
(operating cash flows less capital expenditures and distributions
to minority interests).
Transition to Public Ownership Complete: The sponsors of a 2006 LBO
previously directed HCA's financial strategy, but their ownership
stake decreased steadily following a 2011 IPO and HCA has appointed
four independent members to the 11-member board of directors (BOD),
bringing the total to seven.
More Predictable Capital Deployment: Under the direction of the LBO
sponsors, HCA's ratings were constrained by shareholder-friendly
capital deployment; the company has funded $7.5 billion in special
dividends and several large repurchases of the sponsors' shares
since 2010. Fitch thinks HCA will have a more consistent and
predictable approach to funding shareholder payouts under public
ownership and an independent BOD.
Expect Stable Leverage: Fitch forecasts that HCA will produce
discretionary FCF (operating cash flows less capital expenditures
and distributions to minority interests) of about $1.7 billion in
2015, and will prioritize use of cash for organic investment in the
business, acquisitions and share repurchases. At 3.74x, HCA's gross
debt/EBITDA is below the average of the group of publicly traded
hospital companies, and Fitch does not believe that there is a
compelling financial incentive for HCA to apply cash to debt
reduction.
Secular Headwinds to Operating Outlook: Measured by revenues, HCA
is the largest operator of for-profit acute care hospitals in the
country, with a broad geographic footprint. The company benefited
from this favorable operating profile during a period of several
years of weak organic operating trends in the for-profit hospital
industry. Although operating trends improved industrywide starting
in mid-2014, secular challenges, including a shift to lower-cost
care settings and health insurer scrutiny of hospital care, are a
continuing headwind to organic growth.
Expect Ongoing Tapering in 2H'15: Fitch expects slower organic
growth in patient volumes in the for-profit hospital sector in the
second half of 2015 but also believes that the recent rebound in
growth has some legs, and is unlikely to revert to the depressed
levels experienced for much of 2010 - 2013. This is partly because
the hospital industry seems to be finally emerging from a prolonged
and delayed effect of the great recession. In addition, management
initiatives to sustainably boost volumes in light of secular
headwinds to utilization of inpatient hospital care, will help
sustain growth.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for HCA include:
-- HCA's very strong organic patient volume growth (same hospital
growth in adjusted admissions) in the first half of 2015,
supported by a ramp up of Affordable Care Act related benefits
and improving economic conditions, will taper to a more
normalized 2 - 3% later in the year;
-- Modest Operating EBITDA margin compression of less than 100
bps in later 2015 through 2016, primarily the result of
negative operating leverage as volume growth rates normalize 3
and pricing trends remain stable;
-- Fitch forecasts EBITDA of $7.9 billion and discretionary FCF
of $1.7 billion in 2015 for HCA, with capital expenditures of
about $2.5 billion. Higher capital spending is related to
growth projects that support the expectation of EBITDA growth
through the forecast period;
-- The majority of discretionary FCF is directed towards share
repurchases and acquisitions, and most debt due in 2015-2018
is refinanced resulting in gross debt/EBITDA of between 3.5x
–
4.0x through the forecast period.
RATING SENSITIVITIES
Maintenance of a 'BB' IDR will require HCA to operate with debt
leverage sustained around 4.0x and with a FCF-margin of 4 - 5% or
higher. A downgrade of the IDR to 'BB-' is unlikely in the near
term, since these targets afford HCA with significant financial
flexibility to increase acquisitions and organic capital investment
while still returning a substantial amount of cash to shareholders
through share repurchases.
An upgrade to a 'BB+' IDR would require HCA to maintain debt
leverage of 3.0x - 3.5x. In addition to a commitment to operate
with lower leverage, sustained improvement in organic operating
trends in the hospital industry would support a higher rating for
HCA. Evidence of an improved operating trend would include positive
growth in organic patient volumes, sustained improvement in the
payor mix with fewer numbers of uninsured patients and
correspondingly lower bad debt expense, and limited concern that
profitability will suffer from drops in reimbursement rates.
LIQUIDITY
At Sept. 30, 2015, HCA's liquidity included $588 million of cash on
hand, $2.59 billion of available capacity on its senior secured
credit facilities and LTM discretionary FCF of about $2.1 billion.
HCA's EBITDA/gross interest expense is solid for the 'BB' rating
category at 4.7x and the company had an ample operating cushion
under its bank facility financial maintenance covenant, which
requires debt net of cash maintained at or below 6.75x EBITDA.
Fitch believes that HCA's favorable operating outlook and financial
flexibility afford the company good market access to refinance
upcoming maturities. Near-term debt maturities include $28 million
of bank term loans and $150 million of HCA Inc. unsecured notes
maturing in 2015 and $114 million bank term loans and $1 billion
unsecured notes maturing in 2016.
DEBT ISSUE RATINGS
Fitch currently rates HCA as follows:
HCA, Inc.
-- IDR 'BB';
-- Senior secured credit facilities (cash flow and asset backed)
'BB+/RR1';
-- Senior secured first lien notes 'BB+/RR1';
-- Senior unsecured notes 'BB/RR4'.
HCA Holdings Inc.
-- IDR 'BB';
-- Senior unsecured notes 'B+/RR6'.
The Rating Outlook is Stable.
Total debt of approximately $29.8 billion at Sept. 30, 2015
includes $8.3 billion of first-lien secured bank debt, $11.1
billion of first-lien secured notes, $8.9 billion of HCA Inc.
unsecured notes, and $1.0 billion of Hold Co. unsecured notes.
HCA's bank debt comprises approximately $5.7 billion in term loans
maturing through June 2020. The company had full availability on
its $2.0 billion capacity cash flow revolving loan and roughly $600
million availability on its $3.25 billion capacity asset-based
revolving loan (ABL facility).
The secured debt rating is one notch above the IDR, illustrating
Fitch's expectation of superior recovery prospects in the event of
default. The first-lien obligations, including the bank debt and
the first-lien secured notes, are guaranteed by all material wholly
owned U.S. subsidiaries of HCA, Inc. that are 'unrestricted
subsidiaries' under the HCA Inc. unsecured note indenture dated
Dec. 16, 1993.
Because of restrictions on the guarantor group as stipulated by the
1993 indenture, the credit facilities and first-lien notes are not
100% secured. At June 30, 2015, the subsidiary guarantors of the
first-lien obligations comprised about 45% of consolidated total
assets. The ABL facility has a first-lien interest in substantially
all eligible accounts receivable (A/R) of HCA, Inc. and the
guarantors, while the other bank debt and first-lien notes have a
second-lien interest in certain of the receivables.
The HCA Inc. unsecured notes are rated at the same level as the IDR
despite the substantial amount of secured debt to which they are
subordinated, with secured leverage of 2.51x at Sept. 30, 2015.
Fitch often notches ratings on unsecured debt obligations below the
IDR level when secured debt leverage is greater than 2.5x. If HCA
were to layer more secured debt into the capital structure, such
that secured debt leverage is greater than 3.0x, it could result in
a downgrade of the rating on the HCA Inc. unsecured notes to 'BB-'.
The bank agreements include a 3.75x first lien secured leverage
ratio debt incurrence test.
The HCA Holdings Inc. unsecured notes are rated two-notches below
the IDR to reflect the substantial structural subordination of
these obligations, which are subordinate in right of payment to all
debt outstanding at the HCA Inc. level. At Sept. 30, 2015, leverage
at the HCA Inc. and HCA Holdings Inc. level was 3.61x and 3.74x,
respectively.
CYPRESS SEMICONDUCTOR: S&P Assigns 'BB-' CCR, Outlook Stable
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Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating to San Jose, Calif.-based Cypress Semiconductor Corp.
The outlook is stable.
At the same time, S&P assigned a 'BB' issue-level rating to the
company's proposed $400 million senior secured term loan due 2022
and existing $450 million revolving credit facility due 2020. The
'2' recovery rating on these instruments indicates S&P's
expectation for substantial (70% to 90%, at the higher end of the
range) recovery of principal in the event of payment default. S&P
also assigned a 'B' issue-level rating to the company's existing
$150 million convertible notes due 2020. The '6' recovery rating
on the notes indicates S&P's expectation for negligible (0% to 10%)
recovery of principal in the event of payment default.
The proceeds will be used to execute a share buyback program and
repay a portion of the company's revolving credit facility
outstanding.
"The rating on Cypress is based on our assessment of its
inconsistent operating history and low growth prospects in a
competitive semiconductor landscape, partly offset by good product
and customer diversification and potential for margin expansion
through cost cuts," said Standard & Poor's credit analyst Minesh
Shilotri.
The stable outlook reflects S&P's view that Cypress' enhanced
product portfolio and cost saving opportunities through the
Spansion acquisition are likely to result in growing free operating
cash flow and improving margins in 2016.
DORAL FINANCIAL: Has Until Dec. 1, 2015 to Propose Chapter 11 Plan
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Cara Salvatore at Bankruptcy Law360 reported that Puerto Rico-based
Doral Financial Corp. will maintain exclusive control over its
bankruptcy until the end of the year under a new ruling filed on
Nov. 2, 2015, that lets Doral keep working toward partial
recoupment of a hotly contested $229 million tax credit.
In the ruling, U.S. Bankruptcy Judge Shelley Chapman gave Doral
until Dec. 31 to exclusively file a Chapter 11 plan and until March
30 to get votes. Doral, which was driven to bankruptcy by the loss
of the $229 million tax claim.
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. The Committee is
represented by Brian D. Pfeiffer, Esq., and Taejin Kim, Esq., at
Schulte Roth & Zabel LLP.
ENERGY FUTURE: Begins Massive Push for Ch. 11 Plan Confirmation
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Matt Chiappardi at Bankruptcy Law360 reported that Energy Future
Holdings Corp. launched its much-anticipated Chapter 11 plan
confirmation push on Nov. 3, 2015, with support and opposition to
the $42 billion debt rework strategy split down the lines of the
power giant's two major lender groups, and the question of whether
some creditors are truly unimpaired front and center.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
Largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
Jointly
administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have $42
billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for the
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee represents the interests of the unsecured
creditors of ONLY of Energy Future Competitive Holdings Company
LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings
Company LLC; and EFH Corporate Services Company, and of no other
debtors. The Committee has selected Morrison & Foerster LLP and
Polsinelli PC for representation in this high-profile energy
restructuring. The lawyers working on the case are James M. Peck,
Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at
Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K.
Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at
Polsinelli PC.
ENERGY FUTURE: Court Denies 2nd Lien Trustee's Summary Judgment Bid
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In a memorandum opinion dated October 28, 2015, available at
http://is.gd/YaaBYKfrom Leagle.com, Judge Christopher S. Sontchi
of the United States Bankruptcy Court for the District of Delaware
denied the motion for summary judgment filed by Computershare Trust
Company N.A. and Computershare Trust Company of Canada, indenture
trustee for the 11% Senior Secured Second Lien Notes due 2021 and
11.75% Senior Secured Second Lien Notes due 2022, in the lawsuit it
brought against Energy Future Intermediate Holding Company LLC and
EFIH Finance Inc.
Judge Sontchi granted summary judgment for EFIH on Counts I-IV,
IX-X and XII of the Amended Complaint. Counts V-VII of the Amended
Complaint are identical in form and substance to claims brought by
the First Lien Trustee on which the Court found summary judgment
for EFIH. Because the Second Lien Trustee has failed to raise any
material disputes of fact that would differentiate its claims from
the First Lien Trustee's claims, the Court incorporated and applied
its previous ruling and granted summary judgment in favor of EFIH
on Counts V-VII of the Amended Complaint. The question of the
Trustee's fees and expenses and "interest on interest" were not the
subject of EFIH's motion and therefore Counts VIII and XI of the
Amended Complaint survive summary judgment.
Through the Complaint, the Second Lien Trustee asserts a claim on
behalf of the holders of the Second Lien Notes against EFIH for
EFIH's failure to pay the "Applicable Premium," which the Second
Lien Trustee claims became due when EFIH made the Partial Paydown.
The Second Lien Trustee also seeks a number of declarations; in
particular, the Second Lien Trustee asks the Court to rule that any
future paydown of the Second Lien Notes prior to their Call Dates
will give rise to a secured claim for the Applicable Premium.
The adversary proceeding is COMPUTERSHARE TRUST COMPANY, N.A. and
COMPUTERSHARE TRUST COMPANY OF CANADA, as INDENTURE TRUSTEE
Plaintiff, v. ENERGY FUTURE INTERMEDIATE HOLDING COMPANY LLC and
EFIH FINANCE INC. Defendants, ADVERSARY PROCEEDING NO. 14-50405
(CSS)(Bankr. D.Del.).
The bankruptcy case is In re ENERGY FUTURE HOLDINGS CORP., et al.,
Chapter 11, Debtors, BANKRUPTCY CASE NO. 14-10979 (CSS)(Bankr.
D.Del.).
Energy Future Holdings Corp., Debtor, represented by Joseph Charles
Barsalona II, Esq. -- barsalona@rlf.com -- Richards, Layton &
Finger, P.A., Iskender H. Catto, Esq. -- McDermott Will & Emery
LLP, Kevin Chang, Esq. -- kevin.chang@kirkland.com -- Kirkland &
Ellis LLP, Richard M. Cieri, Esq. -- richard.cieri@kirkland.com --
Kirkland & Ellis LLP, Mark D. Collins, Richards, Layton & Finger,
P.A., Cormac T. Connor, Esq. -- cormac.connor@kirkland.com --
Kirkland & Ellis LLP, Daniel J. DeFranceschi, Richards, Layton &
Finger, Thomas F. Driscoll III, Bifferato LLC, Michael P. Esser,
Esq. -- michael.esser@kirkland.com -- Kirkland & Ellis LP, Michael
A. Firestein, Proskauer Rose LLP, P. Stephen Gidiere III, Balch &
Bingham LLP, Jeremy L. Graves, GIBSON DUNN & CRUTCHER LLP, William
Guerrieri, Esq. -- william.guerrieri@kirkland.com -- Kirkland &
Ellis LLP, Stephen E. Hessler, Esq. -- stephen.hessler@kirkland.com
-- Kirkland & Ellis LLP, Richard U.S. Howell, Esq. --
richard.howell@kirkland.com -- Kirkland & Ellis LLP, Chad J.
Husnick, Esq. -- chad.husnick@kirkland.com -- Kirkland & Ellis,
LLP, Christopher W. Keegan, Esq. -- christopher.keegan@kirkland.com
-- Kirkland & Ellis LLP, Natalie Hoyer Keller, Esq. --
natalie.keller@kirkland.com -- Kirkland & Ellis LLP, Marc
Kieselstein, Esq. -- marc.kieselstein@kirkland.com -- Kirkland &
Ellis LLP, David M. Klauder, Bielli & Klauder, LLC, Jason M.
Madron, Richards, Layton & Finger, P.A., Jeff J. Marwil, Proskauer
Rose LLP, Todd F. Maynes, Esq. -- todd.maynes@kirkland.com --
Kirkland & Ellis LLP, Andrew McGaan, Esq. --
andrew.mcgaan@kirkland.com -- Kirkland & Ellis LLP, Mark E. McKane
Esq., Esq. -- mark.mckane@kirkland.com -- Kirkland & Ellis LLP,
Bridget K. O'Connor, Esq. -- bridget.oconnor@kirkland.com --
Kirkland & Ellis LLP, Matthew E. Papez, Esq. --
matthew.papez@kirkland.com -- Kirkland & Ellis LLP, Michael A.
Petrino, Esq. -- michael.petrino@kirkland.com -- Kirkland & Ellis
LLP, William T. Pruitt, Esq. -- william.pruitt@kirkland.com --
Kirkland & Ellis LLP, Michael L. Raiff, Gibson Dunn & Crutcher LLP,
Lary Alan Rappaport, Proskauer Rose LLP, Jeremy L. Retherford,
Balch & Bingham LLP, Brenton Rogers, Esq. --
brenton.rogers@kirkland.com -- Kirkland & Ellis LLP, Michael A.
Rosenthal, Gibson Dunn & Crutcher LLP, Edward O. Sassower, Esq. --
edward.sassower@kirkland.com -- Kirkland & Ellis LLP, Brian
Schartz, Esq. -- brian.schartz@kirkland.com -- Kirkland & Ellis
LLP, Tyler D. Semmelman, Richards, Layton & Finger, P.A., Steven N.
Serajeddini, Esq. -- steven.serajeddini@kirkland.com -- Kirkland &
Ellis LLP, Anthony V. Sexton, Esq. -- anthony.sexton@kirkland.com
-- Kirkland & Ellis LLP, Michael B. Slade, Esq. --
michael.slade@kirkland.com -- Kirkland & Ellis LLP, James H.M.
Sprayregen, Esq. -- james.sprayregen@kirkland.com -- Kirkland &
Ellis LLP, Bryan M. Stephany, Esq. -- bryan.stephany@kirkland.com
-- Kirkland & Ellis LLP, Mark K. Thomas, Proskauer Rose LLP, W.
Clark Watson, Balch & Bingham LLP, Aparna Yenamandra, Esq. --
aparna.yenamandra@kirkland.com -- Kirkland & Ellis LLP, Peter
Jonathon Young, Proskauer Rose LLP.
The Official Committee of Unsecured Creditors of Energy Future
Holdings Corp., Energy Future Intermediate Holding Company, LLC,
EFIH Finance, Inc., and EECI, Inc, Creditor Committee, represented
by Adam R. Brebner, Esq. -- brebnera@sullcrom.com -- Sullivan &
Cromwell LLP, Andrew Dietderich, Esq. -- dietdericha@sullcrom.com
-- Sullivan & Cromwell LLP, Mark Andrew Fink, Esq. --
mfink@mmwr.com -- Montgomery, McCracken, Walker & Rhoads, Robert J.
Giuffra Jr., Esq. -- giuffrar@sullcrom.com -- Sullivan & Cromwell
LLP, Brian D. Glueckstein, Esq. -- gluecksteinb@sullcrom.com --
Sullivan & Cromwell LLP, Steven L. Holley, Esq. --
holleys@sullcrom.com -- Sullivan & Cromwell LLP, Alexa Kranzley,
Esq. -- kranzleya@sullcrom.com -- Sullivan & Cromwell LLP, Kimberly
Ellen Connolly Lawson, Esq. -- klawson@reedsmith.com -- Reed Smith
LLP, Sidney S. Liebesman, Esq. -- sliebesman@mmwr.com -- Montgomery
McCracken Walker & Rhoads, LL, Natalie D. Ramsey, Esq. --
nramsey@mmwr.com -- Montgomery, McCracken, Walker & Rhoads, Mark F.
Rosenberg, Esq. -- rosenbergm@sullcrom.com -- Sullivan & Cromwell
LLP, Mark U Schneiderman, Esq. -- schneiderman@sullcrom.com --
Sullivan & Cromwell LLP, Mark B. Sheppard, Esq. --
msheppard@mmwr.com -- Montgomery McCracken Walker, et al, Michael
H. Torkin, Esq. -- torkinm@sullcrom.com -- Sullivan & Cromwell,
LLP, Davis Lee Wright, Esq. -- dwright@mmwr.com -- Montgomery
McCracken Walker & Rhoads LLP, David R. Zylberberg, Esq. --
zylberbergd@sullcrom.com -- Sullivan & Cromwell LLP.
About Energy Future Holding Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly
administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have $42
billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for
the
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee represents the interests of the unsecured
creditors of ONLY of Energy Future Competitive Holdings Company
LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings
Company LLC; and EFH Corporate Services Company, and of no other
debtors. The Committee has selected Morrison & Foerster LLP and
Polsinelli PC for representation in this high-profile energy
restructuring. The lawyers working on the case are James M. Peck,
Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at
Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K.
Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at
Polsinelli PC.
ENERGY FUTURE: Judge Sides With Debtor on Make-Whole Issue
----------------------------------------------------------
Matt Chiappardi at Bankruptcy Law360 reported that a Delaware
bankruptcy judge sided again with Energy Future Holdings Corp. on
Oct. 31, 2015, in its fights with bondholders over make-whole
claims, ruling that a unit of the power giant does not have to pay
a roughly $500 million claimed premium on certain payment-in-kind
notes.
The opinion rendered by U.S. Bankruptcy Judge Christopher S.
Sontchi could further streamline the massive Chapter 11 plan
confirmation hearing set to begin on Nov. 3, on the power giant's
strategy to rework its $42 billion in debt.
About Energy Future Holding Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases jointly
administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have $42
billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for the
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee represents the interests of the unsecured
creditors of ONLY of Energy Future Competitive Holdings Company
LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings
Company LLC; and EFH Corporate Services Company, and of no other
debtors. The Committee has selected Morrison & Foerster LLP and
Polsinelli PC for representation in this high-profile energy
restructuring. The lawyers working on the case are James M. Peck,
Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at
Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K.
Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at
Polsinelli PC.
ENERGY FUTURE: Judge's Ruling Might Shut Down Major Plan Objection
------------------------------------------------------------------
Matt Chiappardi at Bankruptcy Law360 reported that a Delaware
bankruptcy judge's ruling on Nov. 2, 2015, could knock a major
Chapter 11 plan objector's issues out of Energy Future Holdings
Corp.'s case on the eve of the power giant's massive confirmation
trial if the sides agree to a settlement connected to roughly
$1.5 billion in payment-in-kind notes.
During a hearing in Wilmington, U.S. Bankruptcy Judge Christopher
S. Sontchi ruled that if the indenture trustee for EFH unit Energy
Future Intermediate Holding Co. LLC's notes follows a directive by
some of the noteholders to stand down.
About Energy Future Holding Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases jointly
administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have $42
billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for the
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee represents the interests of the unsecured
creditors of ONLY of Energy Future Competitive Holdings Company
LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings
Company LLC; and EFH Corporate Services Company, and of no other
debtors. The Committee has selected Morrison & Foerster LLP and
Polsinelli PC for representation in this high-profile energy
restructuring. The lawyers working on the case are James M. Peck,
Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at
Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K.
Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at
Polsinelli PC.
ERG INTERMEDIATE: Change of Venue Not Warranted, Court Says
-----------------------------------------------------------
In a Memorandum Opinion dated October 26, 2015, available at
http://is.gd/v3fu9ufrom Leagle.com, Judge Halin De Wayne Hale of
the United States Bankruptcy Court for the Northern District of
Texas, Dallas Division, ruled that venue is proper in the Northern
District of Texas because ERG Intermediate Holdings, LLC, is
incorporated in Texas.
A change in venue is not warranted in these Cases for the
convenience of the parties or in the interest of justice, Judge
Hale ruled.
On June 12, 2015, the Court denied the motion of the Official
Committee of Unsecured Creditors to transfer venue of the Chapter
11 cases. The Committee sought to have the venue of the Chapter 11
cases transferred to Santa Barbara, California, Houston, Texas, or
Beaumont, Texas. In the Oct. 26 Opinion, Judge Hale further
explain his reasons for denying the request to transfer venue.
The case is In re: ERG INTERMEDIATE HOLDINGS, LLC, et al., Chapter
11, Debtors, CASE NO. 15-31858-HDH, JOINTLY ADMINISTERED (N.D.
Tex.).
ERG Intermediate Holdings, LLC , Debtor, is represented by Brad B.
Erens, Esq. -- bberens@jonesday.com -- Jones Day, Joseph A.
Florczak, Esq. -- jflorcak@jonesday.com -- Jones Day, Thomas A.
Howley, Esq. -- thowley@jonesday.com -- Jones Day, Vincent P.
Slusher, Esq. -- vince.slusher@dlapiper.com -- DLA Piper LLP US.
Official Committee of Unsecured Creditors, Creditor Committee,
represented by Robert Joel Feinstein, Esq. --
rfeinstein@pszjlaw.com -- Pachulski Stang Ziehl & Jones LLP, John
A. Morris, Esq. -- jmorris@pszjlaw.com -- Pachulski Stang Ziehl &
Jones, LLP, Jeffrey Nathan Pomerantz, Esq. --
jpomerantz@pszjlaw.com -- Pachulski Stang Ziehl & Jones LLP, Jason
R. Searcy, Esq. -- jsearcy@jrsearcylaw.com -- Jason R. Searcy,
P.C., Joshua P. Searcy, Esq. -- joshsearcy@jrsearcylaw.com -- Jason
R. Searcy & Associates, P.C.
About ERG Resources
ERG Resources, LLC, is a privately owned oil & gas producer that
was formed in 1996. Since 2010, ERG Resources and ERG Operating
Co. have been primarily engaged in the exploration and production
of crude oil and natural gas in the Cat Canyon Field in Santa
Barbara County, California. ERG Resources owns 19,027 gross lease
acreage in the Cat Canyon Field. ERG Resources also owns and
operates oil & gas leases representing 683 gross acres of leasehold
located in Liberty County, Texas. The Company's corporate
headquarters is located in Houston, Texas. Scott Y. Wood, through
two of his affiliates, owns 100% of the membership units in ERG
Intermediate Holdings LLC, the parent company.
ERG Intermediate Holdings, ERG Resources and three affiliates
sought Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No.
15-31858) on April 30, 2015, in Dallas, Texas.
The Debtors tapped Jones Day as counsel; DLA Piper as co-counsel;
AP Services, LLC, to provide a CRO; and Epiq Bankruptcy Solutions,
LLC. The Debtors also obtained approval to retain the law firm of
Gibbs and Bruns to prosecute the Nabors Lawsuit on a contingency
fee basis.
ERG Intermediate estimated $100 million to $500 million in assets
and debt.
The U.S. Trustee overseeing the Chapter 11 case of ERG Intermediate
Holdings LLC appointed five creditors, led by Baker Petrolite
Corporation, to serve on the official committee of unsecured
creditors. The Committee has tapped Pachulski Stang Ziehl & Jones
LLP as counsel.
* * *
In June 2015, the bankruptcy court denied a motion filed by the
Creditors Committee to transfer venue to the Central District of
California.
The Court extended the Debtors' exclusive period to propose a
Chapter 11 plan until Oct. 31, 2015, and the period to solicit
acceptances of that plan until Dec. 31, 2015.
ERG Intermediate Holdings, et al., unable to find a buyer willing
to pony up at least $250 million in cash, filed the reorganization
plan that contemplates giving control of the company to their
prepetition lenders.
ESSAR STEEL: Seeks CCAA Protection, Obtains DIP Financing
---------------------------------------------------------
Essar Steel Algoma Inc. on Nov. 9 disclosed that it has sought
protection under the Companies' Creditors Arrangement Act (CCAA)
before the Ontario Superior Court of Justice in order to strengthen
its financial health and solidify its long-term business prospects.
The Company has initiated a corresponding filing in the United
States under Chapter 15 to recognize and give effect to the
Canadian filing. The Company fully expects to continue normal
operations during its restructuring.
"We have taken aggressive measures that succeeded in curtailing
costs and significantly enhancing productivity, ranking Essar Steel
Algoma among the top quartile for low cost producers in North
America," said Kalyan Ghosh, president and chief executive officer
of Essar Steel Algoma. "Despite these efforts we have been forced
to take action today to ensure the continued success of our
business given the record low steel markets, a barrage of imports,
and the untimely and wrongful termination of our long-term iron ore
supply contract. I want to assure our customers, vendors and
employees that we fully expect this restructuring not to disrupt
daily operations," said Mr. Ghosh.
Mr. Ghosh further added, "This process will provide the company
with the time and stability to restructure our finances. We expect
that Essar Steel Algoma will emerge stronger and better able to
compete as an advanced manufacturer."
Essar Steel Algoma also disclosed it has secured a USD$200 million
debtor-in-possession financing facility from a syndicate of lenders
by Deutsche Bank AG to provide adequate liquidity to operate while
it restructures its debt.
The Court has appointed Ernst & Young Inc. to act as Monitor.
Evercore Group L.L.C., Weil Gotshal & Manges LLP and Stikeman
Elliott LLP represent the company as financial advisor and outside
US and Canadian legal counsel, respectively.
About Essar Steel
Headquartered in Sault Ste. Marie, Ontario, Canada, ESA is an
integrated steel producer. Approximately 80% to 85% of ESA's sales
are sheet products with plate products accounting for the balance.
For the 12 months ending December 31, 2013, ESA generated revenues
of C$1.8 billion.
Robert J. Sandoval filed a petition under Chapter 15 of the U.S.
Bankruptcy Code for Essar Steel Algoma Inc., and its debtor
affiliates on July 16, 2014, following the companies' initiation of
a reorganization under Canada's Companies' Creditors Arrangement
Act. The lead case is Essar Steel Algoma Inc., Case No. 14-11730
(D. Del.). Essar Steel operates one of Canada's largest integrated
steel manufacturing facilities. The Chapter 15 case is assigned to
Judge Brendan Linehan Shannon. The Chapter 15 Petitioner's Counsel
is Daniel J. DeFranceschi, Esq., and Amanda R. Steele, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware.
* * *
The Troubled Company Reporter, on Oct. 15, 2015, reported that
Moody's Investors Service downgraded Essar Steel Algoma Inc.'s
(ESA) corporate family rating and probability of default rating to
Caa3 and Caa3-PD from Caa1 and Caa1-PD respectively. At the same
time Moody's downgraded the revolving credit facility rating to B2
from B1, the senior secured term loan facility and senior secured
notes rating to Caa1 from B2. The rating on 1839688 Alberta ULC's
secured (third/fourth lien) notes (guaranteed by ESA and other
subsidiaries of ESA) was downgraded to Ca from Caa2. The outlook
is negative.
ESTERLINA VINEYARDS: Provencher & Flatt Approved as Counsel
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
authorized Esterlina Vineyards & Winery, LLC, to employ Douglas B.
Provencher and Provencher & Flatt, LLP, as counsel.
As reported in the Troubled Company Reporter on Oct. 5, 2015,
Provencher & Flatt will, among other things:
(a) analyze the Debtor's financial condition and counseling on
the effects of bankruptcy proceedings;
(b) prepare the pleadings necessary to commence the bankruptcy
case and appearance at various hearings required during the
bankruptcy proceeding; and
(c) represent in any adversary proceedings commenced by the
Debtor or filed against the Debtor related to the Debtor's Chapter
11 bankruptcy proceeding.
In August 2015, the Debtor's Vice President of Operations Craig
Sterling, contacted Mr. Provencher regarding the Debtor's finances
and bankruptcy options. The Debtor faced a trustee's sale of its
real property on Aug. 13, 2015. On Aug. 7, 2015, the Debtor
retained Provencher & Flatt LLP to file a Chapter 11. On Aug. 11,
2015, Mr. Sterling, one of the Debtor's principals arranged for the
payment of a $25,000 retainer for the Chapter 11.
The Debtor agrees to pay Mr. Provencher at his hourly rate of
$510.
To the best of the Debtor's knowledge, Provencher & Flatt LLP are
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Eric Sterling, one of the managers of the Debtor, in a declaration
in support for the application to employ Douglas Provencher as
counsel, said that the Debtor did not have sufficient funds on hand
to retain bankruptcy counsel. Mr. Sterling arranged to borrow
$25,000 from a friend which was used to provide Provencher & Flatt,
LLP with a $25,000 retainer for a Chapter 11 filing by the Debtor.
Douglas B. Provencher, a partner in Provencher & Flatt LLP in Santa
Rosa, California, filed a supplemental declaration, stating
Provencher & Flatt LLP had work in progress of $1,731 which
included work to prepare the petition, list of twenty largest
creditors, file the petition and notify Bank of the West. The
services were not billed and did not show as a balance due as of
the filing date. Mr. Provencher said he and his firm will "write
off" the prepetition work in progress of $1,731 so there will be no
charge to the Debtor for the prepetition work.
About Esterlina Vineyards & Winery, LLC
Esterlina Vineyards & Winery, LLC filed a Chapter 11 bankruptcy
petition (Bankr. N.D. Calif. Case No. 15-10841) on Aug. 12, 2015.
Eric Sterling signed the petition as president. The Debtor
disclosed total assets of $12,759,291 and total liabilities of
$8,288,420. The Law Offices of Provencher & Flatt LLP
serves as the Debtor's counsel. The case is assigned to Judge
Thomas E. Carlson.
FAR EAST ENERGY: Files Voluntary Ch. 7 Petition, Halts Operations
-----------------------------------------------------------------
Far East Energy Corporation, the U.S. listed company that operates
the Shouyang Coalbed Methane Production Sharing Contract in Shanxi
Province, People's Republic of China, on Nov. 10 disclosed that it
has ceased operations and commenced bankruptcy proceedings by
filing a voluntary petition for relief under provisions of Chapter
7 of Title 11 of the United States Code to initiate an orderly
liquidation of the assets of the Company. The Chapter 7 Case is
entitled "In re Far East Energy Corporation" and is being
administered under case number 15-35970 in the United States
Bankruptcy Court for the Southern District of Texas.
Based in Houston, Texas, with offices in Beijing, China, Far East
Energy Corporation is focused on coalbed methane exploration and
development in China.
FIDELITY & GUARANTY: Fitch Puts 'BB-' Rating on Watch Evolving
--------------------------------------------------------------
Fitch Ratings has placed the ratings assigned to Fidelity &
Guaranty Life and subsidiaries on Rating Watch Evolving. The
affected ratings include the 'BBB' IFS ratings for the life
insurance subsidiaries, Fidelity & Guaranty Life Insurance Co. and
Fidelity & Guaranty Life Insurance Co. of New York, the 'BB' IDR
rating assigned to Fidelity & Guaranty Life Holdings, Inc. (FGLH),
and the 'BB-' senior unsecured note rating.
KEY RATING DRIVERS
The rating action follows the announcement that Fidelity & Guaranty
Life and its primary life insurance subsidiaries (collectively
referred to as F&G Life) have agreed to be acquired by China-based
Anbang Insurance Group Co., Ltd. (Anbang) in an all-cash
transaction valued at approximately $1.58 billion. The transaction
is expected to close in the second quarter 2016 subject to
regulatory approvals and satisfaction of other customary closing
conditions.
The Rating Watch Evolving status reflects the uncertain impact of
the proposed change in ownership on F&G Life's ratings. Fitch's
review of the transaction will focus on the impact on F&G Life's
standalone credit profile, the strategic fit of F&G Life within the
Anbang organization, and Anbang's ability and willingness to
provide financial support to F&G Life. Resolution of the Rating
Watch status will be dependent on completion of the deal, though
the direction of the Rating Watch could change in advance of the
close based on Fitch's ongoing review of the transaction.
The purchase of F&G Life by Anbang reflects a broader strategic
initiative by Anbang to expand its life insurance business
internationally. The proposed acquisition of F&G Life represents
Anbang's first entry into the U.S. insurance market.
The deal removes uncertainty over the future ownership of F&G Life
following the parent company HRG's announcement in April 2015 that
it will be exploring strategic alternatives for F&G Life, which may
include a sale of all or part of its approximately 80% ownership
interest.
RATING SENSITIVITIES
F&G Life's ratings could be downgraded if the transaction is
completed as planned and Fitch believes the proposed transaction
negatively impacts F&G Life's credit profile.
Conversely, F&G Life's ratings could be upgraded if the transaction
is completed as planned and Fitch believes the proposed transaction
positively impacts F&G Life's credit profile.
Fitch has placed the following ratings on Rating Watch Evolving:
Fidelity & Guaranty Life Insurance Co.
Fidelity & Guaranty Life Insurance Co. of New York
-- IFS rating 'BBB'.
Fidelity & Guaranty Life Holdings, Inc.
-- Long-term IDR 'BB';
-- Senior unsecured note due April 2021 'BB-'.
FIDELITY & GUARANTY: Moody's Affirms Ba3 Rating on Unsecured Debt
-----------------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 senior unsecured
debt rating of Fidelity & Guaranty Life Holdings, Inc. (FGLH), a
wholly-owned subsidiary of Fidelity & Guaranty Life (FGL, NYSE:FGL,
unrated, formerly Harbinger F&G, LLC) and the Baa3 insurance
financial strength (IFS) rating of FGLH's primary operating
company, Fidelity & Guaranty Life Insurance Company (FGLIC). The
outlook on the ratings was changed to positive from stable. The
rating action follows the announcement by Anbang Insurance Group
Co., Ltd. (Anbang, unrated) and FGL of the proposed acquisition of
all the outstanding stock of FGL for approximately $1.6 billion in
cash in a transaction expected to close in the second quarter of
2016, subject to regulatory approvals and satisfaction of other
customary closing conditions.
RATINGS RATIONALE
According to Moody's Vice President and Senior Analyst, Shachar
Gonen, "The rating affirmation and positive outlook are primarily
driven by the positive developments in FGLIC's credit profile and
to a lesser extent the potential for support and increased
financial flexibility given the much larger balance sheet of its
new parental owner. Following the acquisition by Anbang, we expect
FGL's business strategy and risk profile to remain essentially
unchanged and the current management team and other key employees
to remain in place." Moody's added that the positive outlook
reflects the company's growing market position, especially in the
fixed indexed annuity (FIA) space, as well as its good
profitability, and higher investment yield from portfolio
repositioning efforts.
The rating agency noted that these strengths are offset by the
concentration of FGLIC's sales in FIAs, along with the associated
hedging and asset liability management challenges. FGLIC's sales
are likely to continue to be highly concentrated in annuity
products in the near-term. Substantial organic growth also
presents the challenge of managing the capital strain of new
business growth.
RATING DRIVERS
While Moody's views FGL's ownership by Anbang as a potential
positive for financial flexibility, the positive ratings pressure
is not dependent on the closing of the transaction. According to
Moody's the following could lead to an upgrade of FGLH's and
FGLIC's ratings: 1) sustained NAIC RBC ratio (company action level)
above 375% while seeking a growth strategy; 2) sustained statutory
return on capital exceeding 6%; and 3) more balanced growth in
profitably priced new FIA business and life insurance. Conversely,
the following factors could result in a return of the outlook to
stable: 1) adjusted financial leverage above 30%; 2) sustained
statutory return on capital less than 6%; 3) significant use of
reinsurance to finance growth; or 4) NAIC RBC ratio (company action
level) declines below 375%.
These ratings were affirmed with the outlook changed to positive
from stable:
Fidelity & Guaranty Life Insurance Company -- insurance
financial strength at Baa3;
Fidelity & Guaranty Life Holdings, Inc. -- senior debt rating at
Ba3.
FGLH is an insurance holding company headquartered in Des Moines,
Iowa. As of June 30, 2015, FGLH reported total assets of about $25
billion and shareholders' equity of approximately $1.5 billion.
The principal methodology used in these ratings was Global Life
Insurers published in August 2014.
FIDELITY & GUARANTY: S&P Puts 'BB-' Rating on CreditWatch Dev.
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it placed its 'BBB-'
long-term counterparty credit and financial strength ratings on
Fidelity & Guaranty Life Insurance Co. and its related insurance
subsidiary, Fidelity & Guaranty Life Insurance Co. of New York
(collectively FGL) on CreditWatch with developing implications. At
the same time, S&P placed its 'BB-' long-term counterparty credit
rating on Fidelity & Guaranty Life Holdings Inc. on CreditWatch
with developing implications.
The CreditWatch placement reflects S&P's currently limited
information about Anbang Insurance Group Co. Ltd.'s
creditworthiness in light of its announcement that it intends to
acquire 100% of FGL. Anbang appears to be growing rapidly through
acquisition, including a recent acquisition of Dutch insurer VIVAT
N.V.
"To settle the CreditWatch placement we require further information
about Anbang's intentions to influence FGL's strategy and
operations," said Standard & Poor's credit analyst Shellie
Stoddard. If Anbang intends to provide more "hands-on" control of
management and strategy, S&P would analyze the creditworthiness of
the consolidated Anbang organization of which FGL is becoming a
part. S&P needs a significant amount of information from Anbang to
determine its creditworthiness. Further, S&P would also consider
FGL's role within the entire Anbang organization.
Anbang's level of financial support for FGL is also unclear. If
Anbang maintains independent or "arm's-length" investment
sponsorship of FGL, providing capital backing in a manner similar
to what HRG Group (current majority owner of FGL) provided in the
past, S&P could affirm its ratings on FGL. The possible rating
upside--although S&P believes that is the least-likely
scenario--would be if Anbang provided enough permanent capital to
improve S&P's current assessment of FGL's capital and earnings.
S&P expects to resolve the CreditWatch placement either within the
next 90 days or by the close of the transaction in the first half
of 2016. The resolution may depend heavily on S&P's ability to
assess Anbang Group's creditworthiness.
FREEDOM COMMUNICATIONS: Wants Court to Approve $22.4M Financing
---------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Freedom
Communications Inc., owner of the Orange County Register newspaper,
on Nov. 3, 2015, asked a California judge to sign off on a $22.4
million bankruptcy financing proposal to fund the media company's
operations through a Chapter 11 restructuring of the business.
Freedom Communications said in court papers that lender Silver
Point Capital LP has agreed to offer the company a new $3 million
senior secured loan.
About Freedom Communications
Freedom Communications, Inc. and 24 of its affiliates sought
Chapter 11 bankruptcy protection in California with the intention
of selling their assets to a group of local investors led by Rich
Mirman, Freedom's chief executive officer and publisher.
Headquartered in Santa Ana, California, Freedom owns two daily
newspapers -- The Press-Enterprise in Riverside, Calif. and The
Orange County Register in Santa Ana, Calif.
Freedom Communications, Inc., et al., filed Chapter 11 bankruptcy
petitions (Bankr. C.D. Cal. Proposed Lead Case No. 15-15311) on
Nov. 1, 2015. Richard E. Mirman signed the petition as chief
executive officer. Lobel Weiland Golden Friedman LLP serves as the
Debtors' counsel.
Freedom Communications Holdings estimated both assets and
liabilities in the range of $10 million to $50 million.
FRESH & EASY: Workers Assert Layoffs Broke State Labor Laws
-----------------------------------------------------------
Kurt Orzeck at Bankruptcy Law360 reported that Fresh & Easy LLC
workers on Oct. 30, 2015, launched a putative class action against
the Company in California state court, claiming the bankrupt
grocery chain broke state labor laws by not giving them enough
advance notice before commencing mass layoffs.
The suit alleges that Fresh & Easy only gave employees between nine
and 22 days' written notice -- far less than the 60 days required
by state law -- before it started laying off more than 100 of them
on Oct. 30.
About Fresh & Easy
Fresh & Easy, LLC, a chain of grocery stores in the Southwest
United States, filed Chapter 11 bankruptcy petition (Bankr. D.
Del.
Case No. 15-12220) on Oct. 30, 2015. The petition was signed by
Peter McPhee as chief financial officer. The Debtor estimated
assets of $10 million to $50 million and liabilities of at least
$100 million.
The Debtor has engaged Cole Schotz P.C. as counsel, Epiq
Bankruptcy
Solutions, LLC as claims and noticing agent, DJM Realty Services,
LLC and CBRE Group, Inc., as real estate consultants and
FTI Consulting, Inc. as restructuring advisors.
Judge Christopher S. Sontchi is assigned to the case.
GENERAL MOTORS: HGM Comments on Ignition Switch Ruling
------------------------------------------------------
Bob Hilliard, appointed by the Federal Judge in the GM MDL
litigation to be the lead attorney for all personal injury and
death cases caused by GM's defective ignition switch, comments on
the Nov. 9 ruling from Bankruptcy Judge Robert Gerber that punitive
damages can be sought against New GM for the knowledge "inherited"
from old GM with respect to the deadly ignition switch.
Mr. Hilliard says the ruling is "a complete win for the
plaintiffs."
"The Judge considered GM's arguments that it should not have to
worry about punitive damages and disagreed."
"A jury will now be allowed to hear evidence of GM's cover up and
determine what monetary punishment to assess for so many needless
deaths and injuries."
"As GM's CEO Mary Barra has said over and over 'We do not want to
ever forget.' Well, Ms. Barra just got her wish. A jury will now
be able to help GM never forget."
From the Order:
But on Product Liabilities Claims and Independent Claims alike, New
GM may be held responsible, on claims for both compensatory and
punitive damages, for its own knowledge and conduct. Under the
Pathway #2 scenario, New GM might have acquired relevant knowledge
when former Old GM employees came over to New GM or New GM took
custody of what previously were Old GM records. Reliance on that,
for punitive damages purposes, is permissible.
But to the extent New GM employees actually had knowledge relevant
to post-Sale accident claims or Independent Claims (even if it was
inherited), plaintiffs in actions asserting such claims are free to
base punitive damages claims on evidence of such knowledge to the
extent nonbankruptcy law permits.
The Court rules simply that evidence of information obtained by New
GM after the sale "gets through the gate," and may be relied upon,
for punitive damages purposes, to the extent otherwise appropriate
in the underlying actions.
Nevertheless, as also discussed above, punitive damages may still
be sought in actions based on post-Sale accidents involving
vehicles manufactured by Old GM to the extent the punitive damages
claims are premised on New GM action or inaction after it was on
notice of information "inherited" by New GM, or information
developed by New GM post-Sale.
About HMG
Hilliard Munoz Gonzales LLP (HMG) -- http://www.hmglawfirm.com/
--specializes in mass torts, personal injury, product liability,
commercial and business litigation, and wrongful death. Hilliard
Munoz Gonzales LLP has been successfully representing clients in
the United States and Mexico since 1986. Bob Hilliard obtained the
Largest Verdict in the country in 2012 and the #1 verdict in Texas
in 2013.
HMG is actively seeking to represent other victims of GM's
defective vehicles.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
-- http://www.gm.com/-- is one of the world's largest automakers,
traces its roots back to 1908.
General Motors Co. was formed to acquire the operations of General
Motors Corp. through a sale under 11 U.S.C. Sec. 363 following Old
GM's bankruptcy filing. The U.S. government provided financing.
The deal was closed July 10, 2009, and Old GM changed its name to
Motors Liquidation Co.
Old GM -- General Motors Corporation -- filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1,
2009. The Honorable Robert E. Gerber presides over the Chapter 11
cases. The Debtors tapped Weil, Gotshal & Manges LLP Jenner &
Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel; and
Morgan Stanley, Evercore Partners and the Blackstone Group LLP as
financial advisor. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP served as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long served as counsel on supplier
contract matters. FTI Consulting Inc. served as financial advisors
to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin &
Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31.
On Dec. 15, 2011, Motors Liquidation was dissolved. On the
Dissolution Date, pursuant to the Plan and the Motors Liquidation
Company GUC Trust Agreement, dated March 30, 2011, between the
parties thereto, the trust administrator and trustee -- GUC Trust
Administrator -- of the Motors Liquidation Company
GUC Trust, assumed responsibility for the affairs of and certain
claims against MLC and its debtor subsidiaries that were not
concluded prior to the Dissolution Date.
* * *
The Troubled Company Reporter, on Aug. 29, 2014, reported that
Fitch Ratings has affirmed the Issuer Default Ratings (IDRs) of
General Motors Company (GM) and its General Motors Holdings LLC (GM
Holdings) subsidiary at 'BB+'. In addition, Fitch has affirmed GM
Holdings' secured revolving credit facility rating at 'BBB-' and
GM's senior unsecured notes rating at 'BB+'. The Rating Outlook
for GM and GM Holdings is Positive.
GENERAL MOTORS: May Face Punitive Damages Over Ignition Switches
----------------------------------------------------------------
Patrick Fitzgerald and Stephanie Gleason, writing for Dow Jones'
Daily Bankruptcy Review, reported that a bankruptcy judge on Nov. 9
said "new" General Motors could face punitive damages from people
suing over faulty ignition switches, a decision that exposes the
post-bankruptcy automaker to millions, if not billions, of dollars
more in damages.
According to the report, General Motors' 2009 exit from bankruptcy
created a restructured automaker dubbed "New GM " while leaving
behind in bankruptcy a collection of unwanted assets known as "Old
GM." New GM argued the chapter 11 case shielded it from lawsuits
related to an ignition-switch defect in cars largely manufactured
prior to the bankruptcy case, the report related.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
-- http://www.gm.com/-- is one of the world's largest automakers,
traces its roots back to 1908.
General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing. The U.S. government
provided financing. The deal was closed July 10, 2009, and Old GM
changed its name to Motors Liquidation Co.
Old GM -- General Motors Corporation -- filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1,
2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. The Debtors tapped Weil, Gotshal & Manges LLP
Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as
counsel; and Morgan Stanley, Evercore Partners and the Blackstone
Group LLP as financial advisor. Garden City Group is the claims
and notice agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims. Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31.
On Dec. 15, 2011, Motors Liquidation was dissolved. On the
Dissolution Date, pursuant to the Plan and the Motors Liquidation
Company GUC Trust Agreement, dated March 30, 2011, between the
parties thereto, the trust administrator and trustee
-- GUC Trust Administrator -- of the Motors Liquidation Company
GUC Trust, assumed responsibility for the affairs of and certain
claims against MLC and its debtor subsidiaries that were not
concluded prior to the Dissolution Date.
* * *
The Troubled Company Reporter, on Aug. 29, 2014, reported that
Fitch Ratings has affirmed the Issuer Default Ratings (IDRs) of
General Motors Company (GM) and its General Motors Holdings LLC
(GM Holdings) subsidiary at 'BB+'. In addition, Fitch has
affirmed GM Holdings' secured revolving credit facility rating at
'BBB-' and GM's senior unsecured notes rating at 'BB+'. The
Rating Outlook for GM and GM Holdings is Positive.
GENERAL MOTORS: Union Accuses Cheating Retirees Out of Benefits
---------------------------------------------------------------
Aebra Coe at Bankruptcy Law360 reported that General Motors was
accused on Oct. 30, 2015, in New York bankruptcy court of violating
a 2009 settlement with workers by unilaterally altering the health
insurance plans of employees who retired early under the deal,
forcing them to pay higher premiums and allegedly cheating them out
of $95 million worth of benefits.
IUE-CWA, the Industrial Division of the Communication Workers of
America, AFL-CIO filed the proposed class action adversary
complaint.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP served as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31.
On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the
Dissolution Date, pursuant to the Plan and the Motors Liquidation
Company GUC Trust Agreement, dated March 30, 2011, between the
parties thereto, the trust administrator and trustee -- GUC Trust
Administrator -- of the Motors Liquidation Company GUC Trust,
assumed responsibility for the affairs of and certain claims
against MLC and its debtor subsidiaries that were not concluded
prior to the Dissolution Date.
As of March 31, 2015, Motors Liquidation had $1.01 billion in total
assets, $69.2 million in total liabilities and $945 million in net
assets in liquidation.
GOODRICH PETROLEUM: S&P Lowers Rating on Series C Stock to 'D'
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
issue-level rating on U.S.-based exploration and production
(company Goodrich Petroleum Corp.'s series C cumulative preferred
stock to 'D' from 'CCC-' following the company's announcement that
it has offered to exchange up to 2.39 million depositary shares of
the series C preferred stock (54% of the outstanding shares) for
the same amount of newly created series E cumulative convertible
preferred stock. The series E preferred stock will have a
liquidation preference of $10 per share, which is $15 lower than
the liquidation preference of the existing series C preferred
stock. The company has also offered to exchange series E preferred
stock for a portion of its existing series B and D cumulative
preferred stock, which are both unrated. The exchange offers are
set to expire at 5:00 p.m. EST on Dec. 8, 2015.
The company's corporate credit rating was recently lowered to 'SD'
(selective default) following an announcement that it reached an
agreement with certain holders of its senior unsecured convertible
notes to exchange the notes for new senior unsecured convertible
notes. S&P expects to review the corporate credit rating and
issue-level ratings when it assess the likelihood of further
exchanges as low. S&P's analysis will incorporate the company's
modestly improved liquidity and leverage position, while still
taking into account the challenging operating environment.
RATINGS LIST
Goodrich Petroleum Corp.
Corporate credit rating SD/--/--
Rating Lowered
To From
Series C cumulative preferred stock D CCC-
HAGGEN HOLDINGS: Albertsons Bidding on Stores at Auction
--------------------------------------------------------
Peg Brickley, writing for Dow Jones' Daily Bankruptcy Review,
reported that Albertsons LLC is bidding on grocery stores being
auctioned by Haggen Holdings LLC, a chain that boomed and busted
this year after buying 146 stores from Albertsons.
According to the report, Haggen blames Albertsons for the failure
of its West Coast expansion to pay off, but Albertsons denies the
accusations, which are contained in a federal court suit.
About Haggen Holdings
Headquartered in Bellingham, Washington, Haggen was founded in 1933
as a single grocery store. From 1933 to 2014, Haggen grew into a
30 store family-run grocery chain, with stores located in the
northwestern United States. From 2011 to 2014, Haggen reduced its
store base to 18, including a stand-alone pharmacy location.
Haggen rapidly expanded in 2014 and 2015, and, as of the Petition
Date, Haggen owned and operated 164 stores through three operating
companies: Haggen, Inc., Haggen Opco North, LLC and Haggen Opco
South, LLC.
Haggen Holdings, LLC, and its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 15-11874 to
15-11879) on Sept. 8, 2015, with the intention of reorganizing, or
selling as a going concern, their stores for the benefit of their
creditors.
The petitions were signed by Blake Barnett, the chief financial
officer.
The Debtors estimated assets of $50 million to $100 million and
estimated liabilities of $10 million to $50 million.
Young, Conaway, Stargatt & Taylor, LLP, is serving as the Debtors'
local counsel. Stroock & Stroock & Lavan LLP serves as the
Debtors' general counsel. Alvarez & Marsal North America, LLC,
acts as the Debtors' financial advisor. Kurtzman Carson
Consultants LLC serves as the Debtors' claims and noticing agent.
HARVARD APPARATUS: Receives Nasdaq Listing Non-Compliance Notice
----------------------------------------------------------------
Harvard Apparatus Regenerative Technology, Inc., a biotechnology
company developing bioengineered organs for life-threatening
conditions, on Nov. 10 disclosed that it has received a continued
listing deficiency notice from The NASDAQ Stock Market LLC because
its share price has not met the $1.00 minimum closing bid price
requirement for 30 consecutive business days [Nasdaq Listing Rule
5450(a)(1)]. This notice has no immediate effect on the Company's
Nasdaq listing or the trading of its common stock.
Nasdaq has provided HART with a 180-day compliance period, until
May 2, 2016, in which to regain compliance with the minimum bid
price requirement [Nasdaq Listing Rule 5500(a)(2)]. If at any time
during the compliance period, the closing bid price of HART's
common stock is at least $1.00 per share for at least ten
consecutive business days, Nasdaq will provide the Company a
written confirmation of compliance and the matter will be closed.
HART's CEO, Jim McGorry, commented, "We are very confident in
HART's ability to regain compliance with Nasdaq's minimum bid price
requirement during the compliance period. We have established a
validated development plan with clear milestones and we are on
target in executing to that plan. Our focus is getting our
technology back into humans and filing our first clinical trial
application with the FDA in 2016. Our confidence is supported by
the emerging data from our cell frame technology, our strong
scientific team and the collaborations with our translational
partners. Further underscoring our confidence is our passion and
dedication to bringing durable life-saving solutions to patients.
Having spent the first few months of my CEO tenure ensuring the
Company is on the right path, I am now able to focus more attention
on outreach with current and prospective investors to make sure
they fully appreciate the value of our company today and the very
significant opportunities we are pursuing."
Should HART not regain compliance with the bid price requirement by
May 2, 2016, it may be eligible for an additional 180-day
compliance period if it meets the market value of publicly held
shares requirement for continued listing, all other initial
inclusion requirements for the Capital Market, except for the bid
price requirement, and provides written notice that it intends to
regain compliance with the bid price requirement during the second
180-day compliance period.
About HART
Harvard Apparatus Regenerative Technology (HART) --
http://www.hartregen.com-- makes bioengineered organs for
life-threatening conditions.
HCA INC: Moody's Assigns B1 Rating on Proposed $1BB Bond Offering
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to the proposed
$1 billion senior unsecured bond offering being issued by HCA, Inc.
Moody's understands that the proceeds from the offering will be
used to fund the redemption of the company's $1 billion 6.5% senior
unsecured notes maturing February 15, 2016. HCA, Inc. is a wholly
owned subsidiary of HCA Holdings, Inc. (collectively HCA or the
company).
All of HCA's existing ratings, including the company's Ba2
Corporate Family Rating and its Ba2-PD Probability of Default
Rating remain unchanged. The rating outlook is stable
This rating has been assigned:
HCA Inc.
Senior unsecured note, B1 (LGD5)
RATINGS RATIONALE
The Ba2 Corporate Family Rating reflects HCA's significant scale,
its geographic diversification with strong presence in key markets,
relatively stable cash flows and our expectation of continued
organic growth. The rating also reflects Moody's belief that HCA
will maintain a more conservative financial policy following the
reduction of private equity ownership, the addition of independent
Directors to the company's Board, and the company's public
disclosure of leverage and liquidity targets. However, Moody's
expects that the company will continue to return capital to
shareholders through share repurchases in lieu of debt repayment.
Further, the ratings also reflect risks associated with ongoing
changes to reimbursement levels that will challenge revenue growth
and margin expansion.
Moody's could upgrade the rating if the company maintains a
conservative financial policy with respect to large debt funded
acquisitions, shareholder distributions or share repurchases,
improves geographic diversity, and sustains debt to EBITDA at about
3.5 times.
Moody's could downgrade the rating if financial metrics weaken due
to deteriorating operating performance, the company incurs a
material amount of debt in order to fund shareholder distributions
or acquisitions, or if Moody's expects debt to EBITDA to be
sustained above 4.5 times.
The principal methodology used in this rating was Global Healthcare
Service Providers published in December 2011.
HCA Holdings, Inc. through its wholly owned subsidiary, HCA Inc.,
is the largest for-profit acute care hospital operator in the US as
measured by revenues. In addition to its acute care hospital
facilities, the company operates psychiatric facilities, a
rehabilitation hospital as well as ambulatory surgery centers and
cancer treatment and outpatient rehab centers located in 20 states
in the U.S. and in England. The company is headquartered in
Nashville, Tennessee and reported revenues in excess of $39
billion, net of the provision for doubtful accounts in the twelve
months ended Sept. 30, 2015.
HCA INC: S&P Assigns 'B+' Rating on New $1BB Sr. Unsecured Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' issue-level
rating (two notches below the corporate credit rating) to
Nashville-based HCA Inc.'s proposed $1.0 billion senior unsecured
notes, which are being issued to refinance existing senior
unsecured debt. S&P assigned a '6' recovery rating to this debt,
indicating its expectation of negligible (0% to 10%) recovery for
bondholders in the event of a payment default. The issue-level
ratings are the same as S&P's ratings on the company's existing
senior unsecured debt.
S&P's 'BB' corporate credit rating on HCA reflects S&P's view that
its scale relative to other health care services peers should allow
the company to better offset declining reimbursement rates with
cost reduction efforts, and that its scale and market presence
should aid in contract negotiations with commercial payors. In
addition, HCA's business is diversified beyond inpatient hospital
services, with about 38% of revenues coming from outpatient
procedures. These factors are only partially offset by S&P's view
that HCA is exposed to reimbursement pressure as government and
commercial payors seek to control costs, and its business is
geographically concentrated in two states, Texas and Florida, which
together represent about half of the company's revenues.
Collectively, these factors support our assessment of a
"satisfactory" business risk profile.
S&P's ratings on HCA also reflect S&P's view that the company will
maintain leverage around 4x and generate funds from operations
(FFO) to total debt in the mid- to high-teens area, consistent with
the stronger end of an "aggressive" financial risk profile. S&P's
ratings also incorporate its expectation that HCA will generate
around $4.4 billion in operating cash flow in 2015, but S&P expects
the company to continue to invest heavily in capital expenditures,
and to continue to prioritize shareholder return over debt
repayment.
RATINGS LIST
HCA Inc.
Corporate Credit Rating BB/Stable/--
New Rating
HCA Inc.
$1.0 Bil. Senior Secured Notes B+
Recovery Rating 6
HOVNANIAN ENTERPRISES: Moody's Lowers Corp. Family Rating to Caa1
-----------------------------------------------------------------
Moody's Investors Service lowered the Corporate Family Rating of
Hovnanian Enterprises, Inc. to Caa1 and placed it under review for
downgrade. Furthermore, Moody's lowered Hovnanian's
Speculative-Grade Liquidity (SGL) Rating to SGL-4 from SGL-3. The
rating action and the review was prompted by Hovnanian's continued
underperformance vs. Moody's expectations and concerns surrounding
the company's liquidity profile including high refinancing risk.
These rating actions were taken for Hovnanian Enterprises, Inc.
Corporate Family Rating, downgraded to Caa1, under review for
downgrade from B3;
Probability of Default Rating, downgraded to Caa1-PD, under
review for downgrade from B3-PD;
Preferred stock, downgraded to Caa3 (LGD6), under review for
downgrade from Caa2 (LGD6);
Speculative-Grade Liquidity Rating lowered to SGL-4 from SGL-3.
These rating actions were taken for K. Hovnanian Enterprises,
Inc.:
First lien senior secured notes, downgraded to B1 (LGD2), under
review for downgrade from Ba3 (LGD2);
Second lien senior secured notes, downgraded to Caa1 (LGD4),
under review for downgrade from B3 (LGD3);
Senior unsecured notes, downgraded to Caa2 (LGD5), under review
for downgrade from Caa1 (LGD5);
Senior unsecured shelf, downgraded to (P)Caa2, under review for
downgrade from (P)Caa1.
All of K. Hovnanian Enterprises' debt is guaranteed by its parent
company, Hovnanian Enterprises, Inc. and its restricted operating
subsidiaries.
RATINGS RATIONALE
The review will focus on how Hovnanian can reduce its refinancing
risk and improve its liquidity profile and credit metrics. As of
July 2015, Hovnanian had $255.8 million of liquidity that included
$207.3 million of unrestricted cash and $48.5 million available
under its $75 million unsecured revolving credit facility. However,
in October 2015, the company paid off its $60.7 million bond
maturity rather than refinancing it. Going into 2016, Hovnanian
will face two additional maturities: $172.7 million in January and
$86.5 million in May. In this review, Moody's will focus on the
company's ability to refinance the upcoming debt instruments given
the company's weak liquidity profile and limited access to
traditional debt capital markets. Non-traditional financing
schemes that the company has started to employ to ramp up its
liquidity are typically more expensive and unwieldy than
traditional capital raising processes. Moody's is concerned that
the asset coverage for debt holders will decline as Hovnanian
executes on these non-traditional financing methods.
Moody's lowered the Speculative-Grade Liquidity (SGL) Rating to
SGL-4 from SGL-3 to reflect that Hovnanian's liquidity profile has
deteriorated and is considered to be weak over the next year. The
SGL rating takes into consideration internal liquidity, external
liquidity (e.g., revolver borrowings), covenant compliance, and
alternative liquidity. The SGL rating was lowered primarily
because of the concerns surround the company's ability to finance
its debt obligations and generate consistently positive funds from
operations. In Moody's view, Hovnanian will need to access
external sources of liquidity in order to take care of the upcoming
debt maturities. In addition, Hovnanian's inability to show
consistent bottom line profitability at a time when most of the
industry is already profitable is troubling.
The principal methodology used in these ratings was Homebuilding
and Property Development Industry published in April 2015.
Established in 1959 and headquartered in Red Bank, New Jersey,
Hovnanian Enterprises, Inc. designs, constructs and markets
single-family detached homes and attached condominium apartments
and townhouses. Homebuilding revenues for the last twelve months
ended July 31, 2015, were approximately $2.1 billion.
HUDSON HEALTHCARE: Cityside's Suit Remanded to NJ State Court
-------------------------------------------------------------
Cityside Archives, Ltd., filed a motion to remand the case
captioned CITYSIDE ARCHIVES, LTD., Plaintiff, v. HUSDON HOSPITAL
OPCO, LLC, et al., Defendants, CIVIL ACTION NO. 15-1796 (D.N.J.),
to the Superior Court of New Jersey, Bergen County.
Defendants Hudson Hospital Opco, LLC; Hudson Hospital Holdco, LLC;
HUMC Opco, LLC; HUMC Holdco, LLC; CarePoint Health Systems, LLC;
Christ Hospital; and Hoboken University Medical Center opposed the
motion.
The case concerns various state causes of action based on the
Defendants' alleged failure to pay termination charges and fees for
services the Plaintiff performed after two bankruptcy
reorganizations. The Plaintiff is a New York corporation that
provides records storage, retrieval, and information management
services to various clients in New Jersey. Cityside entered into
Storage and Service Agreements with two New Jersey hospitals:
Hoboken University Medical Center and Christ Hospital.
Cityside argues that the Court cannot hear their case because the
subject matter jurisdiction requirements are not met. Defendants
reply that the Court cannot remand for two reasons. First, the
Court has jurisdiction because the case meets the jurisdictional
requirements and second, the abstention doctrines do not apply. The
Court finds that it has jurisdiction because the case is related to
the bankruptcy proceedings but must remand the case pursuant to the
doctrine of mandatory abstention.
In the Opinion dated October 27, 2015 available at
http://is.gd/mZ54Spfrom Leagle.com, Judge Madeline Cox Arleo of
the United States District Court for the District of New Jersey
granted the Plaintiff's motion to remand and denied the motion for
fees and costs. The Defendants' motion to dismiss is terminated as
moot.
Cityside Archives, LTD., Plaintiff, is represented by Michael S.
Haratz, HARATZ LAW LLC.
Defendants are represented by Louis A. Modugno, Esq. --
lmodugno@mdmc-law.com -- MCELROY, DEUTSCH, MULVANEY & CARPENTER,
LLP, James J. Digiulio, Esq. -- jdigiulio@mdmc-law.com -- MCELROY
DEUTSCH MULVANEY & CARPENTER & Scott M. Palatucci, Esq. --
spalatucci@mdmc-law.com -- MCELROY DEUTSCH MULVANEY & CARPENTER.
Hudson Healthcare Inc. is a non-for-profit corporation formed
under the laws of the State of New Jersey. Until the sale of
Hoboken University Medical Center by the Hoboken Municipal
Hospital Authority, the Debtor owned and managed the day-today
operations of the Hospital on the Authority's behalf pursuant to a
Manager Agreement dated Feb. 1, 2007. Other than certain contract
rights, other intangibles, and approximately 12 vehicles, the
Debtor did not own any Hospital assets.
Hudson Healthcare filed for Chapter 11 protection (Bankr. D. N.J.
Case No. 11-33014) in Newark on Aug. 1, 2011, estimating assets
and debt of less than $50 million. Affiliate Hoboken Municipal
Hospital Authority also sought Chapter 11 protection.
Attorneys at Trenk, DiPasquale, Webster, Della Fera & Sodono,
P.C., in West Orange, N.J., serve as counsel to the Debtor.
Daniel T. McMurray, the patient care ombudsman, has tapped
Neubert, Pepe & Monteith, P.C., as his counsel effective Aug. 25,
2011. The Official Committee of Unsecured Creditors of Hudson
Healthcare retained Sills Cummis & Gross P.C., in Newark, N.J., as
its counsel, nunc pro tunc to Aug. 12, 2011. JH Cohn LLP serves
as Financial Advisor to the Committee. Epiq Bankruptcy Solutions,
LLC, is the Claims and Noticing Agent and Solicitation Agent.
JAMUL INDIAN: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B' issuer
credit rating to Jamul, Calif.-based Jamul Indian Village
Development Corp. (JIVDC). JIVDC is a wholly owned, unincorporated
instrumentality of the Jamul Indian Village of California (the
tribe). The rating outlook is stable.
At the same time, S&P assigned JIVDC's proposed $460 million senior
secured credit facilities due 2020 and 2021 S&P's 'B' issue-level
rating (the same as S&P's issuer credit rating). The proposed
senior secured credit facility consists of a $15 million priority
revolver due 2020, $335 million term loan B due 2021, and $110
million delayed-draw term loan due 2021.
Standard & Poor's does not assign recovery ratings to Native
American debt issues, as there are significant 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. Specifically, under S&P's
forecast, it expects the priority revolving credit facility to
remain less than 15% of JIVDC's total assets. S&P aligns priority
debt under 15% of total assets with an issue-level rating that is
in line with the issuer credit rating on JIVDC, based on S&P's
notching criteria.
JIVDC plans to use the proceeds from the proposed transaction to:
-- Fund the remaining project costs (about $191 million at
close) for the development and construction of the Hollywood
Casino Jamul (the casino);
-- Establish an interest reserve to fund debt service during
the remaining seven-month construction period and the three
months following the opening of the casino;
-- Repay around $180 million of the outstanding developer loans
due to Penn National Gaming Inc.;
-- Repay subordinated notes held by Lakes Entertainment Inc.
(now known as Golden Entertainment Inc.) for previous
development expenses for approximately $24 million; and
-- Fund transaction fees and expenses.
"Our 'B' issuer credit rating on JIVDC reflects the vulnerability
of a new gaming project to uncertain demand and difficulties in
managing initial costs, which can lead to poor profitability during
the first several months of operations, as well as JIVDC's reliance
on a single asset to meet debt service needs," said Standard &
Poor's credit analyst Carissa Schreck.
These risks are somewhat mitigated by S&P's favorable view of the
property's location and demographics of the surrounding area as
Hollywood Casino Jamul will be the closest casino to the San Diego
market, S&P's expectation that the property will be of high
quality, and an experienced property manager. San Diego Gaming
Ventures, a subsidiary of Penn National Gaming Inc. (Penn
National), an experienced developer and operator of 27 regional
gaming properties in the U.S., is developing and will manage the
casino. JIVDC will also have access to Penn National's player
rewards program, allowing customers to earn points in the casino
and redeem them at one of Penn National's Las Vegas resorts, a
feature that S&P believes could aid visitation and spend at
Hollywood Casino Jamul. Further, S&P expects JIVDC will have
above-average profitability once the casino opens, generating
EBITDA margins in the 40% area as the tribe benefits from low
revenue share payments to the state of California. These factors
underpin S&P's "weak" business risk assessment.
The stable rating outlook reflects S&P's belief that, despite
substantial debt funding, the property will ramp up steadily to
generate sufficient cash to service the capital structure and
maintain an adequate liquidity profile.
S&P could lower the rating if construction challenges delay the
project, cost overruns signal a potential liquidity shortfall, or
if operating results upon opening are significantly weaker than S&P
expects, resulting in EBITDA coverage of interest coverage
sustained at or below 1.5x. Additionally, if the economic
environment deteriorates during the construction period and S&P
come to believe that the project will open slower than it expects,
S&P could lower the rating.
S&P could raise the rating one notch if the property opens
successfully in mid-2016 and generates enough cash flow to
facilitate deleveraging, such that S&P expects debt to EBITDA to
stay below 5x and EBITDA coverage of interest expense above 2x.
KEVIN EDGELL: Ohio Appeals Court Affirms Contempt Order
-------------------------------------------------------
Judge Cynthia Westcott Rice of the Court of Appeals of Ohio,
Eleventh District, Lake County, affirmed the judgment of the Lake
County Court of Common Pleas, Domestic Relations Division, which
adopted the magistrate's decision granting Dawn Edgell's motion to
show cause due to Kevin Edgell's failure to pay child support for
their daughter.
On July 29, 2011, the trial court's magistrate granted Dawn's
motion for child support and ordered Kevin to pay Dawn child
support for their mentally retarded daughter Jaime. On August 16,
2011, the trial court entered judgment adopting the magistrate's
decision.
On September 23, 2013, Dawn filed a motion to show cause as to why
Kevin should not be held in contempt for not paying child support
pursuant to the court's child support order. Kevin filed a motion
to modify child support, arguing he had insufficient income to pay
child support as ordered. On March 20, 2014, Dawn filed a second
motion to show cause.
The magistrate found that Dawn had established a prima facie case
of contempt against Kevin for failure to pay court-ordered child
support; that Kevin had not established an inability-to-pay
defense; and that Kevin was in contempt of the court's August 16,
2011 child support order. Kevin was ordered to serve 30 days in
jail unless he purges himself of his contempt by paying $138.67 per
month toward the arrearage of $12,947.74 on the ongoing child
support for the period of September 1, 2011 through February 28,
2014.
The trial court overruled Kevin's objections and adopted the
magistrate's decision.
Judge Rice held that the trial court was entitled to believe that
Kevin's testimony lacked credibility and that he failed to
establish his inability-to-pay defense. The judge agreed with the
trial court in finding that Kevin's income in 2011 and 2012 was
sufficient to pay his ongoing child support, but that he chose to
pay other expenses instead, and that Kevin was not forthcoming with
respect to his income in 2013.
The case is IN THE MATTER OF: KEVIN EDGELL, Petitioner-Appellant,
and DAWN EDGELL, Petitioner-Appellee, NO. 2014-L-126 (Ohio Ct.
App.).
A full-text copy of Judge Rice's October 26, 2015 opinion is
available at http://is.gd/yvZNyMfrom Leagle.com.
Kevin Edgell is represented by:
Paul R. Malchesky, Esq.
CANNON, AVENI, & MALCHESKY CO., L.P.A.
41 East Erie Street
Painesville, OH 44077
Tel: (440) 357-5537
Fax: (440) 357-9234
Email: pmalchesky@csalagroup.com
Dawn Edgell is represented by:
Mary Joseph Clair, Esq.
4132 Erie Street, #202
Willoughby, OH 44094
Tel: (440) 942-6675
Fax: (440) 942-5752
Email: clairlaw@sbcglobal.net
KITTUSAMY LLP: Proposes Chapter 11 Plan of Reorganization
---------------------------------------------------------
Kittusamy, LLP, filed before the U.S. Bankruptcy Court for the
District of Nevada a proposed Plan of Reorganization that promises
to pay off creditors in full over time.
The Plan provides that:
* Holders of the secured claims of Wells Fargo and Meadows Bank
(Class 1) will be paid the full amount of the unpaid principal
balances of their respective notes, exclusive of all default rate
interest, and paid over the remaining terms of the notes at the
interest rates set forth therein. Any outstanding principal
balance remaining at the end of the note terms will be paid by the
Debtor in one lump sum.
-- Holders of the secured claims of Bank of Nevada and Meadows
Bank secured by the Painted Feather Lot (Class 2) will be paid the
full amount of the unpaid principal balances of their respective
notes, exclusive of all default rate interest, upon the earlier of
the sale of the Painted Feather Lot or the 90th day after the
Effective Date.
-- Holders of the secured claims of General Electric Capital
Corporation and Siemens Financial Services, Inc (Class 3) will be
paid the secured portion of their respective claims (i.e., the fair
market value of their respective collateral as determined by the
Bankruptcy Court) in 60 equal monthly payments of principal and
interest amortized over a five-year period at an annual interest
rate of 5.0%.
-- Holders of other secured claims (Class 4) will be paid the
full amount of the unpaid principal balances of their claims upon
the terms and conditions and at the interest rates set forth in
their respective financing agreements; provided, however, that all
unpaid principal and non-default rate interest accrued prior the
Petition Date will be paid on the 90th day after the Effective Date
of the Plan.
-- Priority non-tax claims (Class 5) are unimpaired and will be
paid in full in cash on the Effective Date.
-- Holders of all allowed administrative convenience claims
(Class 6), which include all unsecured allowed claims against the
Debtor in amounts of $2,500 or less, will be paid the full amount
of their claims, without interest, on the 90th day after the
Effective Date.
-- Holders of general unsecured claims (Class 7) will be paid the
full principal amount of the claims without interest over a
projected period of five years in quarterly payments beginning on
the last Business Day of the first quarter that begins 90 days
after the Effective Date.
-- Holders of equity interests (Class 8) will retain their equity
interests in the Debtor.
A copy of the Plan filed Oct. 15, 2015, is available for free at:
http://bankrupt.com/misc/Kittusamy_209_Plan.pdf
About Kittusamy, LLP
Kittusamy, LLP, doing business as Las Vegas Medical Centers, was
subject to an involuntary Chapter 11 bankruptcy petition (Bankr. D.
Nev. Case No. 15-13868) filed July 2, 2015, by creditors owed $6.93
million on business loans and an equipment lease.
The creditors that signed the petition are Moonshell, Venus Group,
Seven Hills Equipment LLC and Xspectra Inc. Moonshell and Venus
are represented by Samuel A. Schwartz, Esq., at Schwartz Flansburg
PLLC. Xspectra and Seven Hills are represented by Matthew C.
Zirzow, Esq., at Larson & Zirzon, LLC.
Kittusamy denied the allegations claiming that it is generally not
paying its debts as they become due, but, nonetheless, consented to
the entry of an order for relief under Chapter 11 upon which
Kittusamy became a Chapter 11 debtor in possession. The Debtor is
headed by Prem K. Kittusamy, M.D., the managing partner and
president.
Kittusamy is represented by Bart K. Larsen, Esq., and Jason M.
Bacigalupi, Esq., at Kolesar & Leatham, in Las Vegas.
The Debtor disclosed $11.8 million in assets and $16.0 million in
debt in its schedules.
LEAHY TRANSPORTATION: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Leahy Transportation, Inc.
5601-07 Tulip Street
Philadelphia, PA 19153
Case No.: 15-18041
Chapter 11 Petition Date: November 9, 2015
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Hon. Ashely M. Chan
Debtor's Counsel: Thomas Daniel Bielli, Esq.
BIELLI & KLAUDER, LLC
1500 Walnut Street, Suite 900
Philadelphia, PA 19102
Tel: 215-642-8271
Fax: 215-754-4177
Email: tbielli@bk-legal.com
- and -
Cory P. Stephenson, Esq.
BIELLI & KLAUDER, LLC
1500 Walnut Street, Suite 900
Philadelphia, PA 19102
Tel: 215-642-8271
Fax: 215-754-4117
Email: cstephenson@bk-legal.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joseph Leahy, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
LONESTAR GEOPHYSICAL: Bank Creditor Wants More Disclosures
----------------------------------------------------------
Secured creditor Frontier State Bank says the Disclosure Statement
explaining LoneStar Geophysical Surveys, LLC's proposed
Reorganization Plan is barren of particulars with respect to
multiple substantive items and requires additional disclosures.
Frontier State Bank notes, among other things, that in the
Disclosure Statement, the Debtor asserts that the current value of
its assets is $13,900,000 as of Aug. 31, 2015. The Debtor's
Monthly Operating Report for September 2015, however, values assets
at $10,555,113 while the amended schedules of assets and
liabilities conversely, claim that the value of the Debtor's
equipment is $21,653,793. According to Frontier, notwithstanding
the inconsistent valuations for the Debtor's assets, the Debtor
offers little explanation of the methodology for valuing its
equipment.
Frontier also points out that under the Plan, secured creditors and
unsecured creditors are to be "paid in full with interest at the
Market Rate of Interest." FSB notes that the Plan does not provide
any explanation as to how or why the same rate of interest as given
to unsecured creditors over 120 months gives FSB the proper value
of its secured claim.
Moreover, FSB notes that as set forth in the Debtor's voluntary
petition and amended statement of financial affairs, 5150, LLC owns
75.1% of the Debtor's member interests, and Cypress Springs
Associates, LLC and Cypress Springs Investments, L.P. own the
remaining 2.5% and 22.4%, respectively. 5150, LLC is apparently
owned by Heath Harris, CEO and Director of the Debtor. Under the
Plan, the Debtor proposes to cancel its equity interests, and all
member interests in the reorganized Debtor will then be owned by
Heath Harris. According to FSB, the Disclosure Statement, however,
does not describe (a) why 100% of the ownership of the reorganized
Debtor is vested in the owner of 75.1% of the member interests in
the Debtor, and (b) whether any consideration is being paid for
such member interests. It notes that the Plan does not propose any
new value, and the Disclosure Statement does not disclose the value
of the interests that Heath Harris is to obtain under the Plan.
Discovery Prior to Confirmation
In order to avoid obfuscating disclosure statement issues from
confirmation issues, FSB is amenable to approval of a corrected
Disclosure Statement containing adequate information and then the
solicitation of holders of claims and interests. However, in order
to properly analyze the Plan for confirmation purposes, FSB
requests that the Debtor provide, no later than 3 business days
after approval of the Disclosure Statement, the following
information:
(A) Data regarding (a) the number of customer contracts
solicited by the Debtor post-petition, (b) the number of customer
contracts secured by the Debtor post-petition and the terms
thereof, (c) the number of potential customers who rejected the
Debtor's bids, and (d) the number of work offers outstanding;
(B) Corporate ownership documents for Lonestar Geophysical
Systems, L.L.C. and 5150, LLC;
(C) A description of the corporate ownership and organizational
structure, including any affiliates of the Debtor;
(D) Monthly historical financial data for 2014 and 2015; and
(E) The Debtor's federal tax return for year 2014.
FSB also requests that the Court enter a scheduling order regarding
discovery prior to any hearing on confirmation of the Plan to
permit holders of claims and interests to conduct reasonable
discovery to assess the feasibility and confirmability of the
Plan.
Frontier State Bank's attorneys:
William H. Hoch III, Esq.
Christopher Staine, Esq.
John P. Napier, Esq.
CROWE & DUNLEVY
Braniff Building
324 N. Robinson Ave., Suite 100
Oklahoma City, OK 73102-8273
Tel: (405) 235-7700
Fax: (405) 239-6651
The Reorganization Plan
As reported in the Oct. 7, 2015 edition of the TCR, LoneStar
Geophysical Surveys' reorganization plan proposes to pay all claims
in full with interest through monthly payments to creditors until
the claims are paid in full in at least one year.
According to the Disclosure Statement, the secured claim of
Frontier State Bank will be paid in full with interest at the
Market Rate in 120 equal monthly installments. The claimant will
retain its security interests.
Unsecured non-insider claims will be paid in full with interest at
the Market Rate in 180 equal monthly installments. Unsecured
insider claims will be paid in full with interest at the Market
Rate in 180 equal monthly installments commencing on or before the
last day of the first month following the month in which the
Effective Date occurs.
Equity interests will be cancelled. All member interests in the
reorganized Debtor will then be owned by Heath Harris. Under the
Plan, the current board of managers would be eliminated and Heath
Harris, the founder and president, would act as manager.
LoneStar believes its primary asset, the equipment, is currently
worth $13,000,000. LoneStar believes that if its equipment is
marketed for an adequate time, and the property continues to be
properly operated in the meantime, LoneStar's assets would generate
at least $13,900,000, which would allow full payment to all secured
and unsecured creditors. If, however, the property is sold at
auction, sheriff's sale, or other sale without allowing adequate
time for marketing the property, LoneStar believes the property
would be sold for far less and may not bring enough to satisfy the
expenses associated with liquidation and the secured claims against
LoneStar.
A copy of the Disclosure Statement filed Sept. 29, 2015, is
available for free at:
http://bankrupt.com/misc/Leonestar_G_DS_Plan.pdf
About LoneStar Geophysical
LoneStar Geophysical Surveys, LLC, is in the business of acquiring
seismic data for the oil and gas industry. It owns a fleet of 13
state-of-the-art vibes (vibrators that generate seismic waves) and
a commensurately large inventory of wireless nodes (that receive
those seismic waves and transmit the resulting information for
processing and interpretation). LoneStar was formed as an Oklahoma
limited liability company on August 4, 2009 by Heath Harris who
continues to serve as its manager.
LoneStar Geophysical sought Chapter 11 bankruptcy protection
(Bankr. W.D. Okla. Case No. 15-11872) on May 18, 2015.
Judge Hon. Sarah A. Hall presides over the case.
The Debtor tapped Ross A. Plourde, Esq., at McAfee & Taft, as
counsel.
The Debtor disclosed total assets of $21,643,793 and total
liabilities of $12,311,768 in its amended schedules.
* * *
LoneStar sought and obtained an order authorizing its use of cash
collateral claimed by Frontier State Bank through December 2015.
LONESTAR GEOPHYSICAL: UST Has Issues With Disclosure Statement
--------------------------------------------------------------
Samuel K. Crocker, the United States Trustee, filed an objection to
the Disclosure Statement explaining LoneStar Geophysical Surveys,
LLC's proposed Reorganization Plan. The U.S. Trustee says the
Disclosure Statement lacks "adequate information," as defined by
Section 1125(a)(1) of the Bankruptcy Code, including these areas of
disclosure:
1. There does not appear to be a description of all the
available assets and their accompanying values. Without this
information, including the going concern values and the liquidation
values, creditors cannot make an informed decision whether to
accept or reject the plan.
2. The Debtors' schedules list $1,047,878 in accounts
receivables. Neither the status of nor the collectability of those
receivables are mentioned in the Disclosure Statement.
3. There does not appear to be a liquidation analysis that
includes the estimated return to creditors under a chapter 7
liquidation.
The UST asks the Court to deny approval of the Disclosure Statement
as filed.
The United States Trustee is represented by:
Marjorie J. Creasey, OBA#17819
Office of the United States Trustee
215 Dean A. McGee, Fourth Floor
Oklahoma City, OK 73102
Tel: (405) 231-4393
E-mail: marjorie.creasey@usdoj.gov
The Reorganization Plan
As reported in the Oct. 7, 2015 edition of the TCR, LoneStar
Geophysical Surveys has proposed a reorganization plan that
proposes to pay all claims in full with interest through monthly
payments to creditors until the claims are paid in full in at least
one year.
According to the Disclosure Statement, the secured claim of
Frontier State Bank will be paid in full with interest at the
Market Rate in 120 equal monthly installments. The claimant will
retain its security interests.
Unsecured non-insider claims will be paid in full with interest at
the Market Rate in 180 equal monthly installments. Unsecured
insider claims will be paid in full with interest at the Market
Rate in 180 equal monthly installments commencing on or before the
last day of the first month following the month in which the
Effective Date occurs.
Equity interests will be cancelled. All member interests in the
reorganized Debtor will then be owned by Heath Harris. Under the
Plan, the current board of managers would be eliminated and Heath
Harris, the founder and president, would act as manager.
LoneStar believes its primary asset, the equipment, is currently
worth $13,000,000. LoneStar believes that if its equipment is
marketed for an adequate time, and the property continues to be
properly operated in the meantime, LoneStar's assets would generate
at least $13,900,000, which would allow full payment to all secured
and unsecured creditors. If, however, the property is sold at
auction, sheriff's sale, or other sale without allowing adequate
time for marketing the property, LoneStar believes the property
would be sold for far less and may not bring enough to satisfy the
expenses associated with liquidation and the secured claims against
LoneStar.
A copy of the Disclosure Statement filed Sept. 29, 2015, is
available for free at:
http://bankrupt.com/misc/Leonestar_G_DS_Plan.pdf
About LoneStar Geophysical
LoneStar Geophysical Surveys, LLC, is in the business of acquiring
seismic data for the oil and gas industry. It owns a fleet of 13
state-of-the-art vibes (vibrators that generate seismic waves) and
a commensurately large inventory of wireless nodes (that receive
those seismic waves and transmit the resulting information for
processing and interpretation). LoneStar was formed as an Oklahoma
limited liability company on August 4, 2009 by Heath Harris who
continues to serve as its manager.
LoneStar Geophysical sought Chapter 11 bankruptcy protection
(Bankr. W.D. Okla. Case No. 15-11872) on May 18, 2015.
Judge Hon. Sarah A. Hall presides over the case.
The Debtor tapped Ross A. Plourde, Esq., at McAfee & Taft, as
counsel.
The Debtor disclosed total assets of $21,643,793 and total
liabilities of $12,311,768 in its amended schedules.
* * *
LoneStar sought and obtained an order authorizing its use of cash
collateral claimed by Frontier State Bank through December 2015.
MAUI LAND: Reports Third Quarter 2015 Results
---------------------------------------------
Maui Land & Pineapple Company, Inc., reported net income of $9.66
million on $14.5 million of total operating revenues for the three
months ended Sept. 30, 2015, compared with a net loss of $749,000
on $2.73 million of total operating revenues for the same period a
year ago.
For the nine months ended Sept. 30, 2015, the Company reported net
income of $7.73 million on $20.03 million of total operating
revenues compared to a net loss of $1.18 million on $10.2 million
of total operating revenues for the same period last year.
In September 2015, the Company sold the 25-acre Kapalua Golf
Academy parcel and related facilities for $12 million. The sale
resulted in a gain of approximately $10.5 million.
In May 2014, the Company sold a 4-acre parcel and building that
serves as the maintenance facility for the Kapalua Plantation Golf
Course for $2.3 million. The sale resulted in a gain of $1.5
million.
A full-text copy of the press release is available at:
http://is.gd/3XbYRZ
About Maui Land & Pineapple Co.
Maui Land & Pineapple Company, Inc. (NYSE: MLP) --
http://mauiland.com/-- develops, sells, and manages residential,
resort, commercial, and industrial real estate. The Company owns
approximately 23,000 acres of land on Maui and operates retail,
utility operations, and a nature preserve at the Kapalua Resort.
The Company's principal subsidiary is Kapalua Land Company, Ltd.,
the operator and developer of Kapalua Resort, a master-planned
community in West Maui.
Maui Land reported net income of $17.6 million on $33 million of
total operating revenues for the year ended Dec. 31, 2014, compared
with a net loss of $1.16 million on $15.2 million of total
operating revenues in 2013.
Accuity LLP, in Honolulu, Hawaii, issued a "going concern"
qualification in its report on the Company's consolidated financial
statements for the year ended Dec. 31, 2014.
MICROVISION INC: Incurs $3.51 Million Net Loss in Third Quarter
---------------------------------------------------------------
MicroVision, Inc., filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $3.51 million on $2.39 million of total revenues for the three
months ended Sept. 30, 2015, compared to a net loss of $3.35
million on $968,000 of total revenues for the same period during
the prior year.
For the nine months ended Sept. 30, 2015, the Company recorded a
net loss of $10.24 million on $7.34 million of total revenues
compared to a net loss of $14.77 million on $2.79 million of total
revenues for the same period last year.
As of Sept. 30, 2015, the Company had $15.53 million in total
assets, $12.19 million in total liabilities and $3.34 million in
total shareholders' equity.
As of Sept. 30, 2015, backlog was $13.5 million. The company
expects to fulfill this backlog in the remainder of 2015 and in
2016. Cash and cash equivalents at Sept. 30, 2015, were $11.2
million.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/HLjGS9
About Microvision Inc.
Headquartered in Redmond, Washington, MicroVision, Inc. (NASDAQ:
MVIS) is the creator of PicoP(R) display technology, an ultra-
miniature laser projection solution for mobile consumer
electronics, automotive head-up displays and other applications.
MicroVision reported a net loss of $18.1 million on $3.48 million
of total revenue for the year ended Dec. 31, 2014, compared with a
net loss of $13.2 million on $5.85 million of total revenue for the
year ended Dec. 31, 2013.
MILLENNIUM HEALTH: Files Chapter 11 to Facilitate Restructuring
---------------------------------------------------------------
Millennium Health on Nov. 10 disclosed that it filed voluntary
prepackaged Chapter 11 cases in the U.S. Bankruptcy Court for the
District of Delaware to implement its previously announced
financial restructuring plan.
The agreement which led to the terms of the financial restructuring
was reached with near unanimous support of debt holders and the
Company's current equity holders. It contemplates, among other
things, a reduction in the Company's debt by more than $1.15
billion and a contribution of $325 million by current equity
holders. As a result of the restructuring, the lenders will become
the new owners of Millennium. No creditors other than the
Company's lenders will be impacted by the restructuring plan and
there should be no disruption to Millennium's business or
employees. The plan of reorganization, through which the
restructuring transaction will be implemented, is expected to be
confirmed by year end.
"We are pleased to have achieved such strong support for a
consensual restructuring that dramatically improves our balance
sheet," said Chief Executive Officer Brock Hardaway. "This is
excellent news for our customers, suppliers, and employees because
it paves the way for a promising future for Millennium Health."
As only existing lenders and current equity holders are anticipated
to be affected by the terms of the restructuring, all other
creditors including vendors, suppliers, trade partners and other
counterparties are expected to receive all payments due to them in
the ordinary course of business. In response to the overwhelming
support received for the plan, the Company is seeking confirmation
of its plan of reorganization on an expedited basis and anticipates
emerging from Chapter 11 as soon as possible after December 15,
2015.
Millennium Health is represented by Skadden Arps Slate Meagher &
Flom.
Millennium Healthcare Inc. is a medical device and healthcare
support and services company based in Garden City, New York. The
Company purchases, supplies and distributes medical devices and
equipment focused on preventative care through early detection.
* * *
The Troubled Company Reporter, citing The Wall Street Journal,
reported that Millennium Health LLC is working with restructuring
advisers at Lazard Ltd. to explore options for bolstering its
finances as it looks to move past a billing dispute with the U.S.
government.
The TCR, on July 30, 2015, reported that Moody's Investors Service
downgraded Millennium Health, LLC's Corporate Family Rating to Caa2
from B2 and Probability of Default Rating to Caa2-PD from B2-PD.
Additionally, Moody's downgraded the ratings on the company's
senior secured credit facilities to Caa2 (LGD 4) from B2 (LGD 4).
The ratings remain under review for further downgrade.
The TCR, on July 23, 2015, reported that 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."
MILLENNIUM LAB: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Millennium Lab Holdings II, LLC 15-12284
16981 Via Tazon, Suite F
San Diego, CA 92127
Millennium Health, LLC 15-12285
Rxante, LLC 15-12286
Type of Business: Provider of laboratory-based diagnostic testing
focused on drugs of abuse and clinical
medication monitoring.
Chapter 11 Petition Date: November 10, 2015
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Laurie Selber Silverstein
Debtors' Counsel: Anthony W. Clark, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
One Rodney Square
P.O. Box 636
Wilmington, DE 19899-0636
Tel: (302) 651-3000
Fax: (302) 651-3001
Email: anthony.clark@skadden.com
- and -
Kenneth S. Ziman, Esq.
Raquelle L. Kaye, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
Four Times Square
New York, NY 10036-6522
Tel: (212) 735-3000
Fax: (212) 735-2000
Email: ken.ziman@skadden.com
- and -
Felicia Gerber Perlman, Esq.
Matthew Kriegel, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 N. Wacker Drive
Chicago, IL 60606-1720
Tel: (312) 407-0700
Fax: (312) 407-0411
Email: felicia.perlman@skadden.com
matthew.kriegel@skadden.com
Debtors' YOUNG CONAWAY STARGATT & TAYLOR, LLP
Conflicts
Counsel:
Debtors' LAZARD FRERES & CO., LLC
Investment
Banker:
Debtors' ALVAREZ & MARSAL
Financial 1201 3rd Avenue
Advisor: Suite 800
Seattle, WA 98101
Debtors' PRIME CLERK LLC
Claims and
Noticing Agent:
Estimated Assets: $100 million to $500 million
Estimated Liabilities: More than $1 billion
The petition was signed by Brock W. Hardaway, chief executive
officer.
Consolidated List of Debtors' 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
United States of Government $206,000,000
America, United States settlement
Department of Justice,
U.S. Attorney's Office,
District of
Massachusetts, United
States Federal
Courthouse, 1
Courthouse Way, Suite
9200, Boston MA 02210
United Healthcare, Settlement $15,000,000
9700 Health Care Lane,
Minnetonka, MN 55343
OneBeacon Surety Judgment $8,982,312
Group, 605 Highway
169 North, Suite 800,
Plymouth, MN 55441
Zempleo Inc., 4000 Trade $344,763
Executive Parkway,
Suite 240, San Ramon, CA, 94583
Suna Solutions, Inc., Trade $330,880
4000 Executive
Parkway, Suite 240,
San Ramon, CA, 94583
Aerotek Inc. Trade $270,806
7301 Parkway Dr., Hanover,
MD 21076
Blue Shield of Health $265,000
CA/Health Ins., File Insurance
55331, Los Angeles,
CA 90074-5331
SDG & E Utility $183,000
American Express Trade $153,358
Primero Systems Trade $140,687
AETNA Payor Refund $137,904
Pathway Genomics Trade $125,000
Andwin Scientific Clinical Trade $95,188
Kura Biotech (La Piedra Biotecnologia Trade $90,000
Spa),
Arnold & Porter LLP Trade $88,392
Moody's Investment Trade $61,666
Solomon Page Group Trade $56,109
Orrick Herrington & Sutcliffe LLP Trade $55,000
KPMG LLP Trade $46,000
Kipu Systems LLC Trade $41,724
MOLYCORP INC: Creditors Cry Foul Over Bankruptcy Plan
-----------------------------------------------------
Peg Brickley, writing for Dow Jones' Daily Bankruptcy Review,
reported that Molycorp Inc.'s bondholders and unsecured creditors
are in full revolt against the rare-earths company's version of a
turnaround, challenging the company's right to stay in control of
its chapter 11 bankruptcy.
According to the report, in court filings, lawyers for bondholders
and unsecured creditors claimed Molycorp has capitulated to demands
from Oaktree Capital Group and abandoned its duty to steer the best
course out of bankruptcy. They want to open the door to
reorganization plans that would compete with the one proposed by
Molycorp, the report related.
About Molycorp, Inc.
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.
Secured creditor Oaktree Capital Management L.P., consented to the
use of cash collateral and to extend postpetition financing.
On July 8, 2015, the U.S. trustee overseeing the Chapter 11 case
of Molycorp Inc. appointed eight creditors of the company to serve
on the official committee of unsecured creditors.
MORGANS HOTEL: Incurs $11.7 Million Net Loss in Third Quarter
-------------------------------------------------------------
Morgans Hotel Group Co. filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
attributable to common stockholders of $11.8 million on $53.2
million of total revenues for the three months ended Sept. 30,
2015, compared to a net loss attributable to common stockholders of
$13.7 million on $55.4 million of total revenues for the same
period in 2014.
For the nine months ended Sept. 30, 2015, the Company reported a
net loss attributable to common stockholders of $39.2 million on
$163 million of total revenues compared to net loss attributable to
common stockholders of $55.9 million on $172 million of total
revenues for the same period a year ago.
As of Sept. 30, 2015, the Company had $515 million in total assets,
$774 million in total liabilities and a $259 million total
deficit.
As of Sept. 30, 2015, the Company had approximately $38.8 million
in cash and cash equivalents and $15.8 million of restricted cash.
The Company intends to utilize its cash and cash equivalents to
satisfy its short-term and long-term liquidity requirements and for
general corporate purposes.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/xgkAT7
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
Morgans Hotel reported a net loss attributable to common
stockholders of $66.6 million on $235 million of total revenues for
the year ended Dec. 31, 2014, compared with a net loss attributable
to common stockholders of $58.5 million on $236 million of total
revenues during the prior year.
MOTORS LIQUIDATION: Bledsoe Plaintiffs' Post-Judgment Bids Denied
-----------------------------------------------------------------
Judge Robert E. Gerber of the United States Bankruptcy Court for
the Southern District of New York denied the various motions
seeking post-judgment relief filed by Gary Peller, Esq., on behalf
of the Bledsoe Plaintiffs.
Peller moved:
(a) to amend the Findings of Fact under Fed.R.BankrP. 7052
(b) to alter or amend the Judgment, under Fed.R.Bankr. 9023
(and, presumably, Fed.R.Civ.P. 59(e));
(c) for relief from the Judgment, under Fed.R.Bankr.P. 9024;
and
(d) for reargument, under S.D.N.Y. Local Bankruptcy Rule
9023-1.
Judge Gerber held that Peller's contentions in his motion for
amendments in the court's findings are inappropriate even on a
motion for reargument.
Judge Gerber also found that Peller's arguments in his motion to
alter or amend the Judgment, to the extent the Bledsoe Plaintiffs
did not already win on them, repeat contentions the court already
rejected, are inappropriate for Rule 59 relief, or both.
As to Peller's motion for relief from judgment, Judge Gerber also
found his arguments, to the extent the Bledsoe Plaintiffs did not
already win on them, lack merit.
Finally, Judge Gerber found Peller's motion for reargument to be
without basis.
The case is In re MOTORS LIQUIDATION COMPANY, et al., f/k/a General
Motors Corp., et al., Chapter 11, Debtors, CASE NO. 09-50026 (REG)
(JOINTLY ADMINISTERED) (Bankr. S.D.N.Y.).
A full-text copy of Judge Gerber's October 20, 2015 order is
available at http://is.gd/3M0pAwfrom Leagle.com.
Bledsoe Plaintiffs are represented by:
Gary Peller, Esq.
1718 Connecticut Avenue, N.W., 6th Floor
Washington, DC 20009
General Motors LLC (New GM) is represented by:
Arthur J. Steinberg, Esq.
Scott I. Davidson, Esq.
KING & SPALDING LLP
1185 Avenue of the Americas
New York, NY 10036
Tel: (212) 556-2100
Fax: (212) 556-2222
Email: asteinberg@kslaw.com
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin,
Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges
LLP, assist the Debtors in their restructuring efforts. Al Koch
at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as
the Chief Executive Officer for Motors Liquidation Company. GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP
is providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims. Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31.
On Dec. 15, 2011, Motors Liquidation Company was dissolved. On
the Dissolution Date, pursuant to the Plan and the Motors
Liquidation Company GUC Trust Agreement, dated March 30, 2011,
between the parties thereto, the trust administrator and trustee
-- GUC Trust Administrator -- of the Motors Liquidation Company
GUC Trust, assumed responsibility for the affairs of and certain
claims against MLC and its debtor subsidiaries that were not
concluded prior to the Dissolution Date.
As of June 30, 2015, Motors Liquidation had $860 million in total
assets, $74 million in total liabilities and $786 million in net
assets in liquidation.
NEUSTAR INC: S&P Lowers Rating on Sr. Secured Debt to 'BB'
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Sterling,
Va.-based diversified telecommunications services provider Neustar
Inc.'s senior secured debt to 'BB' from 'BB+' and revised the
recovery rating to '2' from '1'. The '2' recovery rating indicates
S&P's expectation for substantial (70%-90%; lower end of the range)
recovery in the event of payment default. S&P also lowered the
senior unsecured debt rating to 'B' from 'B+' and revised the
recovery rating to '6' from '5'. The '6' recovery rating indicates
S&P's expectation for negligible (0%-10%) recovery in the event of
payment default.
The rating action reflects the upsizing of the company's term loan
A by $350 million to an outstanding amount of $652 million (which
dilutes recovery prospects for existing senior secured and
unsecured creditors) to fund the acquisition of MarketShare
Partners LLC for $450 million, which does not include tax benefits
of $60 million. MarketShare earned about $57 million of revenue
over the last 12 months and S&P expects a minimal EBITDA
contribution in 2016. The company is a provider of marketing
analytics technology solutions, which will bolster Neustar's
capabilities in its marketing services segment.
The 'BB-' corporate credit rating and stable outlook on Neustar is
not immediately affected by the announced acquisition. S&P expects
that leverage will increase to around 2.4x from 1.6x as of Sept.
30, 2015, because of the acquisition and that leverage could rise
to the high-3x area by 2017 after it loses the Number Portability
Administration Center (NPAC) contract. As such, Neustar does not
have significant headroom for further debt-financed acquisitions.
S&P could lower the ratings if leverage rises above 4x unless it
revise its business risk assessment, which S&P currently views as
"weak".
RATINGS LIST
Neustar Inc.
Corporate Credit Rating BB-/Stable/--
Downgraded; Recovery Rating Revised
Neustar Inc.
To From
Senior Secured BB BB+
Recovery Rating 2L 1
Senior Unsecured B B+
Recovery Rating 6 5
NEWSTAR FINANCIAL: Fitch to Rate Upsized Unsec. Notes 'BB-'
-----------------------------------------------------------
Fitch Ratings expects to assign a long-term rating of 'BB-' to
NewStar Financial, Inc.'s (NewStar) proposed upsizing of up to $50
million under the same terms as its current outstanding senior
unsecured notes. The notes will rank pari passu with existing
senior unsecured notes issued by NewStar.
In April 2015, the company issued $300 million of 7.25% senior
unsecured notes due May 1, 2020. Proceeds from the issuance are
expected to be used to fund portfolio investments and for general
corporate purposes.
The expected note issuance is consistent with Fitch's expectation
that leverage will meaningfully increase over the next two years,
as the company plans to use incremental borrowings to fund net
portfolio growth and improve shareholder returns. Fitch calculates
NewStar's leverage on the basis of debt-to-tangible common equity,
without affording any equity credit to the company's subordinated
notes. On this basis, Fitch calculates that NewStar's leverage
amounted to 4.8x on a GAAP basis as of Sept. 30, 2015. Pro forma of
the proposed incremental note issuance, leverage would increase
incrementally to 4.9x, which remains consistent with the
management's leverage target of between 6.0x-6.5x.
KEY RATING DRIVERS
IDRS AND SENIOR DEBT
The expected rating on NewStar's proposed unsecured note issuance
is equalized with the company's long-term Issuer Default Rating
(IDR), reflecting Fitch's expectation of the sufficiency of
stressed unencumbered assets relative to unsecured notes.
The IDR and Stable Outlook reflect NewStar's middle market direct
lending franchise, well diversified portfolio of senior secured
loans, demonstrated underwriting track record, modest but growing
asset management platform, diversified funding profile and seasoned
senior management team. The rating also reflects the expected
benefits of NewStar's strategic partnership with GSO Capital
Partners (GSO), a subsidiary of The BlackStone Group L.P.
(long-term IDR 'A+', Stable Outlook) and Franklin Square Capital
Partners.
These strengths are counterbalanced by NewStar's concentrated
business model, outsized exposure to middle market borrowers, high
mix of secured funding, lackluster financial performance relative
to stated targets, shifting strategic direction over time and
planned rapid growth supported by increased leverage. These
constraints are set against the backdrop of a highly competitive
middle market underwriting environment, which could pressure asset
quality in the coming years, particularly in the context of
NewStar's growth aspirations.
RATING SENSITIVITIES
IDRS AND SENIOR DEBT
The rating of the senior unsecured notes is sensitive to changes in
NewStar's IDR and the level of unencumbered balance sheet assets in
a stressed scenario, relative to outstanding unsecured notes.
Positive rating drivers for the IDR could include continued
demonstration of stable asset quality performance, particularly for
more recent vintages underwritten under increasingly competitive
conditions, increased funding diversity, and successful execution
of the strategy to grow the portfolio, improve profitability, and
realize synergies from the GSO relationship. Reduced leverage
relative to current targets, although not expected based on
management's articulated strategy, could also contribute to
positive rating momentum.
Negative rating drivers for the IDR would include material
deterioration in asset quality, a migration away from the primary
focus on senior secured loans and toward more junior investment
positions, or an increase in leverage beyond the forecasted level.
The provision of financial support to non-recourse funding sources
which impairs NewStar's financial position would also be viewed
negatively.
Fitch assigns the following expected rating:
NewStar Financial, Inc.
-- Senior unsecured notes 'BB-(EXP)'.
Fitch currently rates NewStar Financial, Inc. as follows:
-- Long-term IDR 'BB-';
-- Short-term IDR 'B';
-- Senior unsecured notes 'BB-';
-- Subordinated notes 'B'.
The Rating Outlook is Stable.
NRAD MEDICAL: Court Approves Margolin Winer as Accountants
----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized NRAD Medical Associates, P.C., to employ Margolin, Winer
& Evens LLP as accountants.
MW&E is expected to perform, among other services:
-- appear at Court hearings, if required;
-- prepare tax returns (including 2014, 2015, and future years,
as necessary);
-- advise the Debtor with respect to tax issues that arise
during the Debtor's case;
-- assist the Debtor in preparing projections for its plan of
reorganization; and
-- perform any other services that may be deemed necessary and
that are typically performed by accountants for a company in
bankruptcy.
Teddy Selinger, a member of MW&E, in an affidavit in support of the
application stated that as of the Petition Date, MW&E holds a claim
against the Debtor in the amount of $117,869, which MW&E has agreed
to waive if the Court authorizes its retention.
To the best of the Debtor's knowledge, MW&E is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About NRAD Medical
NRAD Medical Associates, P.C., operated a regional radiology
imaging medical practice and a regional radiation therapy practice
with 16 locations throughout Long Island and Queens, New York,
before selling its assets in June 2015.
NRAD Medical sought Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 15-72898) in Central Islip, New York, on July 7,
2015. The case is assigned to Judge Louis A. Scarcella.
The Debtor, in an amended schedules, disclosed total assets of
$28,663,053 and total liabilities of $24,751,950 as of the Chapter
11 filing.
The Debtor is represented by Anthony C Acampora, Esq., at
SilvermanAcampora LLP, in Jericho, New York.
According to the docket, the Debtor's Chapter 11 plan and
disclosure statement are due Nov. 4, 2015.
NRAD MEDICAL: Lindenwood Okayed as Chief Restructuring Consultant
-----------------------------------------------------------------
The Hon. Louis A. Scarcella of the U.S. Bankruptcy Court for the
Eastern District of New York authorized NRAD Medical Associates,
P.C., to continue to employ Lindenwood Associates, LLC, as chief
restructuring consultant, nunc pro tunc to July 7, 2015.
On Jan. 20, 2015, the Debtor employed Lindenwood as its CRC to
assist with its efforts to restructure its business operations, and
pursue one or more potential transactions.
Pursuant to the agreement, Lindenwood was responsible for assisting
the Debtor with managing its accounts receivable, conducting
negotiations with the Debtor's landlords and creditors, and
assisting the management of the Debtor on an "as needed" basis.
On June 23, 2015, in anticipation of a potential chapter 11 filing,
the Debtor's shareholders unanimously passed a resolution
authorizing Lindenwood to "file all petitions, schedules, motions,
lists, applications, pleadings, and other papers" in the Debtor's
chapter 11 case and to perform any other actions which Lindenwood
"deems necessary, proper, or desirable in connection with" the
Debtor's chapter 11 case.
The Debtor has agreed to pay Lindenwood compensation at the rate of
$275 per hour.
To the best of the Debtor's knowledge, Lindenwood is a
"disinterested person" as that term is defined in Section 101)14)
of the Bankruptcy Code.
About NRAD Medical
NRAD Medical Associates, P.C., operated a regional radiology
imaging medical practice and a regional radiation therapy practice
with 16 locations throughout Long Island and Queens, New York,
before selling its assets in June 2015.
NRAD Medical sought Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 15-72898) in Central Islip, New York, on July 7,
2015. The case is assigned to Judge Louis A. Scarcella.
The Debtor, in an amended schedules, disclosed total assets of
$28,663,053 and total liabilities of $24,751,950 as of the Chapter
11 filing.
The Debtor is represented by Anthony C Acampora, Esq., at
SilvermanAcampora LLP, in Jericho, New York.
According to the docket, the Debtor's Chapter 11 plan and
disclosure statement are due Nov. 4, 2015.
NRAD MEDICAL: SilvermanAcampora Approved as Bankruptcy Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized NRAD Medical Associates, P.C., to employ
SilvermanAcampora LLP as counsel.
The professional services that SilvermanAcampora will render to the
Debtor will include:
a) legal advice with respect to the Debtor's powers and duties
as a Debtor in accordance with the provisions of the Bankruptcy
Code in connection with the Debtor's continued management of its
property and affairs;
b) prepare, on behalf of the Debtor, all necessary applications,
motions, answers, orders, reports, plans and disclosure statements
and other legal documents required by the Bankruptcy Code and
Federal Rules of Bankruptcy Procedure;
c) represent the Debtor in certain pending litigation, to the
extent necessary.
Gerard R. Luckman, Esq., a member of SilvermanAcampora submitted a
declaration to supplement the application, stating that prior to
the Petition Date, SilvermanAcampora received a retainer from the
Debtor. Any unused portion of the retainer will be applied against
fees and expenses approved by the Court after appropriate
application and notice.
To the best of the Debtor's knowledge, SilvermanAcampora is
SilvermanAcampora is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Gerard R. Luckman, Esq.
Sheryl P. Giugliano, Esq.
Brian Powers, Esq.
SILVERMANACAMPORA LLP
100 Jericho Quadrangle, Suite 300
Jericho, NY 11753
Tel: (516) 479-6300
About NRAD Medical
NRAD Medical Associates, P.C., operated a regional radiology
imaging medical practice and a regional radiation therapy practice
with 16 locations throughout Long Island and Queens, New York,
before selling its assets in June 2015.
NRAD Medical sought Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 15-72898) in Central Islip, New York, on July 7,
2015. The case is assigned to Judge Louis A. Scarcella.
The Debtor, in an amended schedules, disclosed total assets of
$28,663,053 and total liabilities of $24,751,950 as of the Chapter
11 filing.
The Debtor is represented by Anthony C Acampora, Esq., at
SilvermanAcampora LLP, in Jericho, New York.
According to the docket, the Debtor's Chapter 11 plan and
disclosure statement are due Nov. 4, 2015.
ORGANIC AVENUE: Yellen Partners to Conduct Auction on Nov. 16
-------------------------------------------------------------
Yellen Partners, LLC, a financial services, asset management,
auctioneer and appraisal firm, on Nov. 9 disclosed that Organic
Avenue, LLC, the former grab-and-go destination for organic,
plant-based meals and snacks in New York City, has retained Yellen
Partners to conduct an auction of the company's machinery and
equipment. The sale will be conducted as a timed, Bidspotter
online auction of assets at more than 10 retail locations and one
commissary location starting on Nov. 16 and ending on Nov. 20,
2015.
"We look forward to offering customers an opportunity to purchase
Organic Avenue's high-quality and professionally-maintained
restaurant and kitchen equipment at a considerable value," said
Brian Yellen, president of Yellen Partners.
Organic Avenue recently filed for Chapter 7 bankruptcy relief in
the United States Bankruptcy Court for the Southern District of New
York and Jil Mazer-Marino, Esq. has been appointed as the Chapter 7
trustee for the company. Concurrent with Yellen Partners' efforts,
Ms. Mazer-Marino is conducting an effort to find a turnkey buyer of
the assets.
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.
PACIFIC RECYCLING: Gleaves Swearingen Approved as Panel's Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon authorized the
Official Committee of Unsecured Creditors appointed in the Chapter
11 cases of Pacific Recycling, Inc., to employ Cassie K. Jones,
Esq., and the law firm of Gleaves Swearingen LLP as counsel.
The firm is expected to, among other things, (a) advise and consult
with applicant concerning questions arising in the conduct of the
administration of the estate and concerning applicant's rights and
remedies with regard to the estate's assets and the claims of
secured, priority and unsecured creditors and other parties in
interest; and (b) appear for, prosecute, defend and represent
Applicant's interest in proceedings arising in or related to the
case.
The firm's normal hourly billing rates are:
Partners $200 - $395
Associates $110 - $175
Paraprofessionals $110 - $150
Law Clerks $60
To the best of the Debtors' knowledge, the firm has no interest
materially adverse to the interest of the estate or of any class of
creditors or equity security holders.
The firm is represented by:
Cassie K. Jones, Esq.
GLEAVES SWEARINGEN LLP
P.O. Box 1147
Eugene, OR 97440
Tel: (541) 686-8833
Fax: (541) 345-2034 (fax)
E-mai: jones@gleaveslaw.com
About Pacific Recycling
Pacific Recycling, Inc. filed a Chapter 11 bankruptcy petition
(Bankr. D. Ore. Case No. 15-62925) on Aug. 27, 2015. The petition
was signed by Rodney Schultz as president. The Debtor disclosed
total assets of $5,996,665 and total liabilities of $21,718,414.
Hon. Frank R. Alley III is assigned to the case. Cable Huston LLP
represents the Debtor as counsel.
The U.S. Trustee for Region 18 appointed four creditors of Pacific
Recycling Inc. to serve on the official
committee of unsecured creditors.
PARALLEL ENERGY: Files for Chapter 11 with $110M Purchase Deal
--------------------------------------------------------------
Parallel Energy LP and Parallel Energy GP LLC filed Chapter 11
bankruptcy petitions with an agreement to sell substantially all of
their assets to Scout Energy Group II, LP, as the stalking horse
bidder, for $110 million. The sale is subject to higher and better
bids and Bankruptcy Court approval.
"The filing of the Cases is the result of extensive negotiations
between the Debtors and their Pre-Petition Lenders, and between the
Debtors and the prospective buyer," said Richard N. Miller, chief
financial officer of Parallel Energy GP LLC.
The Debtors disclosed that, as of Sept. 30, 2015, they had, based
on internally prepared financial statements that are not prepared
according to U.S. GAAP, assets with book value of approximately
$221 million in assets, and approximately $161 million in
liabilities to non-related parties.
Parallel has one secured creditor -- a syndicate of Canadian bank
lenders comprising of Canadian Imperial Bank of Commerce, Royal
Bank of Canada, The Bank of Nova Scotia and Wells Fargo Bank, N.A.
Canadian Branch, with CIBC acting as the Administrative Agent.
The Debtors, engaged in the business of acquiring, owning,
developing and operating long-life oil and natural gas properties
in Texas and Oklahoma, said the global decline of oil and gas
prices and the oversupply of global oil production has had a
significant negative impact on their business.
With no available capital to continue as a going concern, the
Debtors initiated a marketing effort for their assets. The Debtors
said that despite effort to identify a sale or refinancing
transaction that could be completed outside of Chapter 11, no such
transaction was available.
The Debtors, in consultation with the Pre-Petition Lenders, have
collectively determined that the proposal submitted by Scout Energy
and the corresponding marketing process to be completed as part of
the Debtors' Chapter 11 cases, would maximize the financial return
to their creditor constituencies with minimal closing risk.
Scout Energy had entered into a stalking horse purchase and sale
agreement with LP. As part of its bankruptcy process, the Debtors
intend, among other things, to seek an order from the Bankruptcy
Court approving Scout as the stalking horse bidder and a
corresponding marketing process that would culminate in an auction
designed to maximize the sales price for their assets.
Contemporaneously with the petitions, Parallel Energy Commercial
Trust and two other Canadian entities affiliated with the Debtors,
Parallel Energy Trust and Parallel Energy Inc., have filed
applications seeking relief under the Companies' Creditors
Arrangement Act of Canada. The Commercial Trust is a sole member
of Parallel Energy GP.
Restructuring Support Agreement
Parallel's strategic review process also culminated in a
Restructuring Support Agreement with the Bank Lenders, dated Nov.
8, 2015.
The RSA requires Parallel to sell all of its oil and gas assets
free and clear of all liens, claims, and encumbrances, pursuant to
Section 363 of the Bankruptcy Code, no later than Feb. 4, 2016. The
Bank Lenders have agreed to: (a) waive compliance with certain
sections of the Credit Agreement, the application of which would
have triggered a default under the Credit Agreement (provided that
the Bank Lenders are permitted to charge interest at a default rate
in accordance with the Credit Agreement); (b) not object to the 363
sale; (c) not vote for any plan of reorganization or liquidation
that is inconsistent with the 363 sale; (d) not solicit any sale,
liquidation or reorganization of any Parallel entity; (e) not
commence or support the appointment of a trustee or receiver; (f)
not object to the D&O Trustee using funds under the D&O Trust in
accordance with the terms of the D&O Trust; (g) not object to a key
employee retention plan being presented in the CCAA proceedings and
a key employee incentive plan being presented in the Cases; (h) to
the extent that a plan of reorganization is filed, not object to
the Parallel directors and officers seeking customary releases
thereunder; (i) if required, agree to fund both the CCAA
proceedings and the Cases through two separate debtor-in-possession
facilities until their appropriate conclusion; and (j) agree that
both the Trust Services Agreement and the GP Services
Agreement will remain in force.
First Day Motions
The Debtors have filed with the Court certain first day motions
which they believe are necessary to enable them to operate in
Chapter 11 with minimal disruption. Among other things, the
Debtors seek to: (a) use existing cash management system; (b) pay
employee obligations; (c) prohibit utility providers from
discontinuing services; and (d) obtain $9.4 million post-petition
financing and use cash collateral.
A copy of the declaration in support of the First Day Motions is
available for free at:
http://bankrupt.com/misc/15_PARALLEL_Declaration.pdf
About Parallel Energy
Parallel Energy LP and Parallel Energy GP LLC sought Chapter 11
bankruptcy protection (Bank. D. Del. Case No. 15-12263 and
15-12264, respectively) on Nov. 9, 2015. The petition was signed
by Richard N. Miller as chief financial officer.
The Debtors have oil and gas assets in five locations: the West
Panhandle Field (Texas), the Cargray Area (Texas), Roberts County
(Texas), Garfield County (Oklahoma), and Jefferson County
(Oklahoma). The Debtors' workforce consists of 45 employees.
The Debtors have engaged Thompson & Knight LLP and Bayard, P.A. as
co-counsel, Alvarez & Marsal North America, LLC as financial
advisor and Prime Clerk LLC as notice, claims, solicitation and
balloting agent.
PARALLEL ENERGY: Seeks Joint Administration of Cases
----------------------------------------------------
Parallel Energy LP and Parallel Energy GP LLC ask the Bankruptcy
Court to jointly administer their Chapter cases under the Case
styled In re Parallel Energy LP, et al., Case No. 15-12263).
Bankruptcy Rule 1015(b) provides, "if two or more petitions are
pending in the same court by or against...a debtor and an
affiliate, this Court may order a joint administration of the
estates" of such debtor and its affiliates. The Debtors maintain
that they are "affiliates," as that term is defined by Section
101(2) of the Bankruptcy Code.
GianClaudio Finizio, Esq., at Bayard, P.A., counsel to the Debtors,
relates that joint administration of the Cases will be an efficient
use of the Court's and the Debtors' resources. He adds joint
administration will permit the use of a single, general docket for
the Cases and combine notices to creditors and other
parties-in-interest of the Debtors' respective estates.
According to Mr. Finizio, joint administration will reduce the cost
and burden of repetitive, duplicative and potentially confusing
filings by permitting counsel for all parties-in-interest to (a)
use a single consolidated caption on the numerous documents that
will be filed and served in the Cases; and (b) file documents in
only one of the Cases rather than in multiple Cases.
He also said that the supervision of the administrative aspects of
the Cases by the U.S. Trustee and the Court will be simplified.
Moreover, the Debtors seek authority to file the monthly operating
reports required by the U.S. Trustee Operating Guidelines on a
consolidated basis.
About Parallel Energy
Parallel Energy LP and Parallel Energy GP LLC sought Chapter 11
bankruptcy protection (Bank. D. Del. Case No. 15-12263 and
15-12264, respectively) on Nov. 9, 2015. The petitions were signed
by Richard N. Miller, as chief financial officer.
The Debtors are oil and gas businesses engaged in acquiring,
owning, developing and operating long-life oil and natural gas
properties in Texas and Oklahoma. The Debtors' workforce consists
of 45 employees.
The Debtors have engaged Thompson & Knight LLP and Bayard, P.A. as
co-counsel, Alvarez & Marsal North America, LLC as financial
advisor and Prime Clerk LLC as notice, claims, solicitation and
balloting agent.
PENTON OPERATING: Moody's Raises CFR to B2, Outlook Stable
----------------------------------------------------------
Moody's Investors Service has upgraded Penton Operating Holdings,
Inc.'s corporate family rating to B2 from B3 and the second lien
term loan to Caa1 from Caa2. The rating for the first lien credit
facility was affirmed at B1. The outlook is stable.
The upgrade of the CFR reflects the reduction in leverage to 5.3x
as of Q3 2015 and the success growing its higher margin trade show
and digital divisions which has offset significant declines in its
Print division. Leverage has declined due to EBITDA growth aided
by recent acquisitions and approximately $18 million of debt
repayment in the first three quarters of 2015.
The first lien debt was affirmed at B1 despite the upgrade of the
CFR as the amount of first lien debt accounts for a more
significant part of the capital structure which reduces the amount
of rating lift from the $196 million second lien term loan.
The debt is jointly borrowed by two subsidiaries of the company,
Penton Media, Inc. and Penton Business Media, Inc.
Moody's has taken these rating actions:
Issuer: Penton Operating Holdings, Inc.
Corporate Family Rating, upgraded to B2 from B3
Probability of Default Rating, upgraded to B2-PD from B3-PD
Outlook, Stable
Issuer: Penton Business Media, Inc. (Co-Borrowed by Penton Media,
Inc.)
$50 million sr sec revolver due 2018 affirmed at B1 (LGD3)
$446 million 1st lien term loan due 2019 affirmed at B1 (LGD3)
$196 million 2nd lien term loan due 2020 upgraded to Caa1 (LGD5)
from Caa2 (LGD5)
Outlook, Stable
RATING RATIONALE
Penton's B2 CFR reflects its leverage of 5.3x (including Moody's
standard adjustments) as of Q3 2015 and its cyclical business
profile. The ratings also reflect large declines in Print revenues
which currently account for approximately 32% of LTM total revenue
as of Q3 2015. However, as the Print business has lower overall
EBITDA margins than its Digital and Events segments, it accounts
for a smaller percentage of overall EBITDA and Print is expected to
continue to decrease as a percentage of total revenue going
forward. The company will need to continue carefully managing the
transition from Print to Digital which will require cost cutting at
declining print operations while supporting growing digital and
data products.
The rating is supported by the company's improved business mix
between print and digital content, the established position in the
trade show industry, and strong position in the niche verticals
where it operates. The focus on five different industry segments
provides diversification and reduces the sensitivity the company
has to any one industry. EBITDA margins are good and have remained
in the 35% range over the past several years. Moody's expects
Penton to generate over $50 million of free cash flow annually
which may be used to help fund future acquisitions which would
contribute to EBITDA growth.
Moody's expects Penton to have good liquidity over the next twelve
months supported by over $50 million in free cash flow due to
minimal capex spending of about $15 million. Cash on the balance
sheet is $6 million pro-forma for the MRO Network acquisition and
the $50 million revolver is undrawn. There are no additional
amortization payments required on the first lien term loan as the
company has prepaid the amortization payments until maturity.
The term loans have no financial covenants. The revolver will be
subject to a maintenance covenant when greater than 25% of the
aggregate amount of the revolver is drawn. When this condition is
met, the company will be subject to a First Lien Net Leverage Ratio
(as defined) of 6x. Moody's expects substantial cushion against
this covenant over the next year.
The stable outlook reflects Moody's expectation that Penton will
continue to modestly grow EBITDA as the percentage of its lower
margin print business declines and is offset by its higher margin
digital business.
An additional upgrade is unlikely in the near term given the recent
upgrade. However, the ratings could be upgraded if Penton is able
to reduce leverage below 4.25x on a sustained basis while
demonstrating positive organic revenue growth and good free cash
flow. Confidence that the private equity sponsors intend to
maintain leverage below this level would also be required.
Additionally, a rating upgrade would be predicated on Penton
maintaining strong EBITDA margins and good liquidity.
The ratings could be downgraded if the company's revenues decline
materially due to economic weakness or operational underperformance
so that leverage rose above 5.5x. A debt funded equity friendly
transaction or acquisition that led to leverage above this level
would also result in a downgrade as would a failure to maintain an
adequate liquidity profile.
Penton Operating Holdings, Inc., headquartered in New York, NY, is
a diversified business-to-business media company providing trade
show, print, and digital products and services. Penton emerged
from Chapter 11 bankruptcy protection in March 2010. Revenue for
the twelve months ended Sept. 30, 2015 was $369 million.
The principal methodology used in these ratings was Global
Publishing Industry published in December 2011.
PINETREE CAPITAL: Cures "Event of Default" on Secured Debentures
----------------------------------------------------------------
Pinetree Capital Ltd. on Nov. 9 disclosed that the company has
cured the "Event of Default" that resulted from its October 2014
breach of a debt covenant contained in the indenture governing the
company's 10% Convertible Secured Debentures maturing May 31, 2016.
Pinetree's debt-to-assets ratio was below 33% as at October 31,
2015 in compliance with the Covenant.
The effect of the cure is that the holders of the Debentures (the
"Debentureholders") no longer have any rights or remedies in
respect of the Event of Default, including the right to immediately
demand repayment of the principal amount of the Debentures.
Furthermore, the company is no longer subject to the forbearance
agreement that it entered into with the Debentureholders in
February 2015 in connection with the Event of Default, all of the
terms and conditions of which were complied with by Pinetree during
the forbearance period.
With the expiration of the forbearance period on October 31, the
Investment Oversight Committee of the board of directors was
dissolved in accordance with its mandate and Dennis Logan, Andrew
Steuter and John Varghese, the Debentureholder nominees to the
company's board of directors, will be resigning effective November
9, 2015.
The company is also no longer required to continue the monthly
disclosure of its net asset value per share (NAV), which it will
cease doing following the October NAV disclosure. As Pinetree's
private company investments have become a more significant part of
the company's portfolio by fair value, monthly NAV calculations are
less meaningful. The company will continue to disclose quarterly
NAV along with its financial results.
"We've worked responsibly and diligently over the course of the
last eight months to ensure that Pinetree remained on-side of the
commitments made to debt holders in February, when we undertook
this process," said Richard Patricio, Pinetree's Chief Executive
Officer. "Our task was certainly not made easier by the
challenging valuations in the junior resource and tech spaces that
persisted throughout the year. I am quite proud of the Pinetree
team and of what we have accomplished in a relatively brief and
certainly challenging period of time. With our debt level reduced
from $54.8 million to $9.7 million and our return to being in
compliance with our covenants, we can focus more completely on
growing the portfolio."
About Pinetree
Pinetree is a diversified investment and merchant banking firm
focused on the small cap market, with early stage investments in
resource, biotechnology and technology companies. Pinetree's
shares are listed on the Toronto Stock Exchange ("TSX") under the
symbol "PNP".
PUTNAM ENERGY: 3rd Attempt on Insider Sale of Oil & Gas Rights Hit
------------------------------------------------------------------
Putnam Energy, L.L.C.'s third attempt at winning approval from the
bankruptcy court to transfer pursuant to 11 U.S.C. Sec. 363 certain
unidentified working interests in Clay County, Indiana oil and gas
leases ("UWI") to its affiliate, Carbon Shales, LLC, is still being
opposed by creditors Bridgeview Bank Group and Trinity Industries
Leasing Company.
On Aug. 5, 2015, the Debtor filed its first Motion to Authorize
Debtor to Enter into Agreement Concerning Oil and Gas Interests in
Clay County, Indiana. The Debtor proposed a transaction involving
the transfer of what it termed "inchoate rights" owned by its
estate with respect to four leases of natural gas wells in Clay
County, Indiana.
A hearing was held on the Original Motion, at which both Trinity
and another creditor, Bridgeview Bank Group raised objections. The
Court expressed agreement with a number of points made by the
objecting parties, including the Debtor's failure to identify with
particularity what interests were being transferred, the terms of
the operative agreement, and the grounds for allowing the transfer
under section 363 of the Code. The Court gave the Debtor an
opportunity to file an amended motion with more factual and legal
support.
On Aug. 20, 2015, the Debtor filed an Amended Motion to Authorize
Debtor to Enter into Agreement Concerning Oil and Gas Interests in
Clay County, Indiana. The most significant change to the previous
version was the Debtor's inclusion of several documents, all dated
May 29, 2009, which, according to the Debtor, collectively conveyed
to the Debtor the rights it intended to sell.
Trinity and Bridgeview both filed objections to the Amended Motion.
In Trinity's objection, it argued that (a) the Debtor failed to
provide adequate information to allow the Court and interested
parties to evaluate the proposed transaction; (b) the relief sought
was impermissibly broad, including the "cleansing" of non-estate
assets; (c) the Debtor's transaction was proposed in bad faith; and
(d) contrary to the Debtor's assertions, there was no emergency
requiring immediate action by the Court. The Debtor replied with a
short memorandum.
At a hearing held on Sept. 16, 2016, the Court ruled that the
Amended Motion was inadequate. Particularly, the Court cited the
Debtor's failure to specify the nature and source of the rights it
proposed to transfer, and to identify with transparency the insider
connections among the various entities involved in the proposed
transaction. The Court also admonished the Debtor not to attempt
to eliminate liens on property held by non-debtor affiliates. The
Court gave the Debtor another opportunity to amend its motion.
On Sept. 25, 2015, the Debtor filed its Second Amended Motion,
styled as a "supplemental and amending" motion, again proposing a
transaction (the "Proposed Transaction") involving four oil and gas
wells in Clay County, Indiana. The Second Amended Motion
characterizes the Proposed Transaction as a transfer of a
percentage of the "working interests" in property defined as the
"Wellbores." "Wellbores" are defined as "the wells to be drilled
at the wellbores." Both the Debtor and its affiliate, Midwest Gas
Storage, Inc. ("MGS") are said to own "interest[s]" in the
Wellbores. The Debtor asserts that MGS is the holder of "recorded
title to the Lease Area and the Wellbores in the Lease Area." The
interest held by the Debtor is said to be "rights to explore for
oil and gas," which, according to the Debtor, were conveyed to the
Debtor by a series of at least four transactions among insiders of
the Debtor, all occurring on May 29, 2009.
Trinity asserts that it is impossible for the Court or interested
parties to assess the merits of the Second Amended Motion because
it fails to identify with any particularity the relief it seeks or
the grounds therefor. According to Trinity, among its more
prominent facial defects, the Second Amended Motion (a) describes
the rights to be transferred incoherently, (b) contains no concrete
assertions of fact as to the value of the assets to be transferred,
the likelihood of the recompletion succeeding, or the value to be
gleaned by the estate if the recompletion is successful, and (c)
was apparently not served on many of the parties most affected by
it.
Trinity avers that even if the Court is willing to overlook the
many defects apparent on the face of the Second Amended Motion,
there are numerous substantive reasons why the Proposed Transaction
would be detrimental to the estate and would not satisfy the
requirements of Section 363 of the Bankruptcy Code. According to
Trinity, these include (a) the slim chance of the wells ever
producing gas in commercially viable quantities, (b) the
possibility that the proposed recompletion will do irreparable
damage to wells' present value as storage wells, and (c) the
impermissible transfer of non-debtor assets into, then out of, the
bankruptcy estate.
According to Bridgeview, neither the Court nor any of Putnam's
creditors can even begin to assess whether Putnam's proposed
transaction is legitimate or reasonable if Putnam cannot even
define the items of estate property it proposes to transfer. It
notes that Putnam has now had three chances to define the rights it
wishes to transfer, but it has failed miserably all three times.
Putnam, Bridgeview contends, has certainly fallen far short of
satisfying the heightened scrutiny standard that applies to its
proposed transfer to an insider. According to Bridgeview, given
Putnam's well-documented history of questionable business dealings
and/or outright fraud, there is reason to believe Putnam is
intentionally trying to suppress information regarding the details
of its proposed insider transfer to prevent others from
understanding its true implications.
Bridgeview notes that Putnam, in its schedules, claims its rights
relating to property in Clay County, Indiana have a value of $3
million. Yet, Putnam is proposing to transfer the UWI to Carbon
Shales in exchange for no monetary compensation. Putnam will
supposedly receive a 44% "working interest" in four redeveloped
wells if Carbon Shales can obtain the redevelopment funds from
investors, but Putnam's Second Amended Motion fails to provide any
basis for valuing the 44% "working interest" that Putnam may
receive from Carbon Shales. Worst of all, Putnam's Second Amended
Motion states Carbon Shales (not Putnam) will be the operator of
the wells after Putnam's proposed transaction is finished,
according to Bridgeview.
Bridgeview avers that Putnam is proposing to transfer whatever
rights it is referencing in its Second Amended Motion free and
clear from Bridgeview's liens. Bridgeview's liens total more than
$1.9 million and Bridgeview does not consent to the proposed sale
of its collateral.
"The Debtor has not satisfied its burden of persuading the Court
that the Proposed Transaction makes good business sense. To the
contrary, it is evident that the Proposed Transaction would be an
abuse of section 363 of the Code and the bankruptcy process in
general, and is proposed in bad faith as an attempt to perpetrate a
fraudulent transfer to the detriment of the bankruptcy estate and
its creditors," Trinity tells the Court.
A hearing on the Second Amended Motion is scheduled for Nov. 12,
2015 at 11:00 a.m.
Trinity Industries' attorneys:
Dorothea L. Vidal, Esq.
GEARY, PORTER & DONOVAN, P.C.
One Bent Tree Tower
164 Dallas Parkway, Suite 400
Addison, TX 75001-6837
Tel: (972) 931-9901
Fax: (972) 931-9208
- and -
Howard L. Adelman, Esq.
Nathan Q. Rugg, Esq.
Alexander F. Brougham, Esq.
ADELMAN & GETTLEMAN, LTD.
53 W. Jackson Blvd, Suite 1050
Chicago, IL 60604
Tel: (312) 435-1050
Fax: (312) 435-1059
Bridgeview Bank Group's attorneys:
Beau T. Greiman, Esq.
GREIMAN, ROME & GRIESMEYER, LLC
24115 West 103rd Street, Suite B
Naperville, IL 60564
Tel: (630) 369-9901
Fax: (630) 369-9886
E-mail: bgreiman@grglegal.com
About Putnam Energy
Putnam Energy, L.L.C., a company with power plant and pipeline
assets, sought Chapter 11 protection (Bankr. N.D. Ill. Case No.
15-08733) on March 11, 2015, in Chicago, Illinois, after it failed
to reach a forbearance agreement with its lender.
The Debtor disclosed $10,394,596 in assets and $2,283,218 in
liabilities as of the Chapter 11 filing.
The case is assigned to Judge Carol A. Doyle. Terrence O'Malley,
manager and CEO, signed the petition.
The Debtor is represented by Douglas S Draper, Esq., at Heller,
Draper, Patrick, Horn & Dabney, LLC, in New Orleans, as counsel.
PWK TIMBERLAND: Wants Authority to Sell Louisiana Real Estate
-------------------------------------------------------------
PWK Timberland, LLC, asks the United States Bankruptcy Court for
the Western District of Louisiana, Lake Charles Division, for
authority to sell real estate located in Calcasieu Parish,
Louisiana.
The Debtor asserts that among the assets which constitute property
of the Debtor's estate is 244 acres (more or less) of real estate
located in Calcasieu Parish, Louisiana. The Debtor has negotiated
a sale with Bart R. Yakupzack and/or assigns to sell the real
property for a total sales price of $816,000. The Debtor asserts
that it is in the best interest of the creditors that the Debtor
has authority to sell the said property. The net proceeds of the
sale are defined as that amount remaining after paying the costs
associated with the sale as per the agreement.
The bankruptcy court scheduled for hearing on November 19, 2015 at
10:30 a.m.
PWK Timberland, LLC is represented by:
Gerald J. Casey, Esq.
613 Alamo Street
Lake Charles, LA 70601
Tel: (337) 474-5005
Fax: (337) 310-4877
E-mail: gcasey@caseylaw.net
About PWK Timberland
Lake Charles, Louisiana-based PWK Timberland LLC sought Chapter 11
protection (Bankr. W.D. La. Case No. 13-20242) on March 22, 2013.
Gerald J. Casey, Esq., serves as counsel to the Debtor. The Debtor
disclosed $15 million in assets and $1.79 million in liabilities as
of the Chapter 11 filing.
The Debtor has filed a first amended plan of reorganization and
explanatory disclosure statement. A copy of the First Amended
Disclosure Statement dated April 30, 2014, is available for free at
http://bankrupt.com/misc/PWKTIMBERLAND_1stAmdDS.PDF
PWK Timberland's Plan provides that all allowed claims will be
satisfied in full. The Plan contemplates (i) that the unsecured
claims of former members are unimpaired; (ii) the Debtor does not
believe there are any general unsecured creditors but if there are,
they will be paid in full on the Effective Date; and (iii) equity
holders agreed to forgo any payments under the plan until all
impaired creditors have been paid in according to the terms of the
Plan.
QORVO INC: S&P Assigns 'BB+' CCR & Rates $1BB Sr. Notes 'BB+'
-------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB+'
corporate credit rating to Greensboro, N.C.-based Qorvo Inc. The
outlook is stable.
S&P also assigned its 'BB+' issue-level rating and '3' recovery
rating to the company's recently announced $1 billion senior
unsecured notes and to its existing $300 million unsecured
revolving credit facility. The '3' recovery rating indicates S&P's
expectation for meaningful (50%-70%; lower half of the range)
recovery in the event of payment default.
"The rating on Qorvo is based on our assessment of a 'fair'
business risk profile, a 'minimal' financial risk profile, and a
one-notch negative comparable ratings analysis modifier," said
Standard & Poor's credit analyst James Thomas.
Key risks stem from a high level of customer concentration,
exposure to the consumer wireless market, and limited track record
operating as a single entity. S&P views leading intellectual
property (IP) in 4G-enabling filter design, significant EBITDA
margin improvement in recent quarters, and adjusted leverage
expected to remain below 0.5x as credit strengths.
S&P's stable outlook on Qorvo reflects S&P's expectation that the
firm's leading position in RF semiconductor devices, growth in
mobile data traffic, and increasing level of RF content in
4G-enabled phones will enable Qorvo to outgrow the broader analog
semiconductor market and sustain leverage below 2x.
S&P could lower the rating if failure to secure critical design
wins with leading global smartphone original equipment
manufacturers leads to declining revenues and margins, causing
sustained leverage over 2x.
Ratings upside is currently constrained by a high degree of
customer and end-market concentration.
QUAD/GRAPHICS INC: Moody's Lowers CFR to Ba3, Outlook Negative
--------------------------------------------------------------
Moody's Investors Service downgraded Quad/Graphics, Inc.'s
corporate family rating to Ba3 from Ba2 and also downgraded the
company's probability of default rating (PDR) to Ba3-PD from Ba2-PD
and its senior unsecured notes to B2 from B1. While the senior
secured credit facility's Ba2 rating was affirmed, Quad's
speculative grade liquidity rating was downgraded to SGL-3
(adequate) from SGL-1 (very good) and the ratings outlook was
changed to negative from stable.
Bill Wolfe, a Senior Vice President at Moody's indicated that "The
action was prompted by Moody's assessment that Quad's de-levering
capacity has been permanently impaired, and that Moody's adjusted
leverage of Debt-to-EBITDA would remain elevated at about 4x over
the next year or so." In turn, Moody's reassessment was prompted by
Quad's third quarter earnings-related disclosure that business
fundamentals had unexpectedly and materially deteriorated, causing,
among other things, a sizeable, 14%, downwards revision in 2015
EBITDA as well as a $775 million Goodwill impairment.
Wolfe added that "The potential of further deterioration in the
company's debt reduction capacity and leverage remaining elevated
for a prolonged period," caused the ratings outlook to be negative.
While management signaled its expectations of abilities to augment
cash flow and debt repayment through cost and working capital
management during the next two years, Moody's said that the
abruptness and magnitude of the guidance revision together with the
sizeable Goodwill impairment, highlight risks, including the
company's negligible forward earnings visibility. Together with
ongoing market developments which Moody's believes indicate that
the pace of digitization is accelerating, there are, in Moody's
view, as many external risks as there are internal opportunities.
Considerations also include Quad's strategic imperatives involving
the simultaneous consolidation of the print industry while also
repositioning activities to "capitalize on print's ability to
complement and connect with other media channels"; these
imperatives involve execution risks and will inevitably also
involve investment and, given their relative strategic importance,
may also delay de-leveraging.
Additionally, since it appears that Quad may not be able to
entirely repay maturing debts from internally generated cash flow,
and may depend on its revolving credit facility for supplementary
debt repayment funding, the company's speculative grade liquidity
rating was downgraded to SGL-3 (adequate). Moody's does not
anticipate covenant compliance issues over the next year or so but,
as the company's guidance revision highlights, visibility is
limited and caution is warranted should EBITDA continue to
decline.
While Quad's Ba2 senior secured credit facility's rating remains
unchanged, the facility's expected loss has been revised and is now
positioned at the bottom of the Ba2 rating range, having previously
been at the top. The Ba2 facility rating has also become sensitive
to the relative proportions of senior and junior raking debts.
Absent a change in its CFR, a significant proportionate increase in
Quad's secured debt or a significant proportionate decrease in
junior ranking debts would likely result in the secured credit
facility being downgraded from Ba2 and aligned with the company's
CFR.
Summary of rating action and Quad's ratings:
Issuer: Quad/Graphics, Inc.
Corporate Family Rating, Downgraded to Ba3 From Ba2
Probability of Default Rating, Downgraded to Ba3-PD From Ba2-PD
Senior Unsecured Notes, Downgraded to B2 (LGD5) From B1 (LGD5)
Speculative Grade Liquidity Rating, Downgraded to SGL-3 From
SGL-1
Senior Secured Bank Credit Facility, Affirmed at Ba2 (LGD3)
Outlook, Changed to Negative From Stable
RATINGS RATIONALE
Quad's Ba3 corporate family rating is influenced by exposure to the
challenging commercial printing industry, expectations of declining
revenue, continuing margin pressure, and Moody's expectations that
Quad's leverage of debt-to-EBITDA will be about 4x through 2016.
Quad maintains adequate liquidity, operates relatively low cost
facilities and the company's historic financial conservatism
provides confidence that management is willing to reduce leverage.
Rating Outlook
The outlook is negative owing to the potential of leverage
remaining elevated for a prolonged period because adverse market
conditions may stifle management's de-levering efforts.
What Could Change the Rating - Up
Along with improved industry fundamentals and cash flow generation,
and clarity concerning dividend plans and solid liquidity, Quad's
ratings could be upgraded if Moody's expected the company's
leverage of debt-to-EBITDA to decline below 3x.
All measures include Moody's standard adjustments
What Could Change the Rating - Down
Negative ratings activity could be considered if Moody's expected
leverage of debt-to-EBITDA to remain near or above 4.5x on a
sustained basis, or it industry fundamentals deteriorated further,
or were Quad to complete a significant debt-financed acquisition or
experience significant adverse liquidity developments.
All measures include Moody's standard adjustments
Corporate Profile
Headquartered in Sussex, Wisconsin, Quad/Graphics, Inc. is a
publicly-traded leading North American commercial printing company.
Annual revenues are in the $4.8 billion range of which 91% comes
from US operations while 5% comes from South American operations
and 4% from European operations.
Principal Methodology
The principal methodology used in rating was the Global Publishing
Industry published in December 2011.
QUIRKY INC: Meeting of Creditors Set for Nov. 17
------------------------------------------------
The meeting of creditors of Quirky Inc. is set to be held on
Nov. 17, 2015, at 2:30 p.m. (prevailing Eastern Time), according to
a filing with the U.S. Bankruptcy Court for the Southern District
of New York.
The meeting will be held at the Office of the U.S. Trustee, Fourth
Floor, 80 Broad Street, in New York.
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 Quirky, Inc.
Headquartered in New York City, Quirky designs and develops various
products ranging from electronics, home and garden, kitchen and
organization and sells those products through big box retailers
like Target and Home Depot and online through its Web site. The
Company sold over 150 different products and a total of 4 million
units, generating over $50 million in revenue from its retail and
consulting businesses in 2014.
Quirky, Inc., Wink, Inc. and Undercurrent Acquisition, LLC filed
Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No.
15-12596) on Sept. 22, 2015, with a deal to sell their assets
related to the Wink business line as a going concern to Flextronics
International USA Inc., for $15 million, absent higher and better
offers.
The petitions were signed by Charles Kwalwasser, the chief
administrative officer.
Judge Martin Glenn is assigned to the jointly administered cases.
Quirky estimated assets in the range of $10 million to $50 million
and liabilities of at least $50 million.
The Debtors have engaged Cooley LLP as counsel, Klestadt Winters
Jureller Southard & Stevens LLP as conflicts counsel, Centerview
Partners LLC as investment bankers, FTI Consulting, Inc., as
financial advisors, Rust Consulting/Omni Bankruptcy as claims and
noticing agent and Hilco IP Services LLC dba Hilco Streambank as
intellectual property disposition consultant to Quirky, Inc.
The U.S. Trustee for Region 2 appointed five members to the
Official Committee of Unsecured Creditors.
QUIRKY INC: Names Q Holding as Stalking Horse for Remaining Assets
------------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Quirky Inc. has
named investment company Q Holdings the front-runner to acquire the
bankrupt startup incubator's remaining assets at a bankruptcy
auction later this month with a $2.3 million stalking horse bid,
according to court documents filed in New York.
Q Holdings' bid, which will serve as the price floor at the
upcoming auction, comes a week after U.S. Bankruptcy Judge Martin
Glenn signed off on Quirky's bidding procedures. The assets on the
auction block include Quirky's trademark, domain name and a
plethora of products.
About Quirky, Inc.
Headquartered in New York City, Quirky designs and develops
various products ranging from electronics, home and garden, kitchen
and organization and sells those products through big box retailers
like Target and Home Depot and online through its Web site. The
Company sold over 150 different products and a total of 4 million
units, generating over $50 million in revenue from its retail and
consulting businesses in 2014.
Quirky, Inc., Wink, Inc. and Undercurrent Acquisition, LLC filed
Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No.
15-12596) on Sept. 22, 2015, with a deal to sell their assets
related to the Wink business line as a going concern to
Flextronics International USA Inc., for $15 million, absent higher
and better offers.
The petitions were signed by Charles Kwalwasser, the chief
administrative officer.
Judge Martin Glenn is assigned to the jointly administered cases.
Quirky estimated assets in the range of $10 million to $50 million
and liabilities of at least $50 million.
The Debtors have engaged Cooley LLP as counsel, Klestadt Winters
Jureller Southard & Stevens LLP as conflicts counsel, Centerview
Partners LLC as investment bankers, FTI Consulting, Inc., as
financial advisors, Rust Consulting/Omni Bankruptcy as claims and
noticing agent and Hilco IP Services LLC dba Hilco Streambank as
intellectual property disposition consultant to Quirky, Inc.
U.S. Trustee for Region 2, has appointed five members to serve in
the Official Committee of Unsecured Creditors.
RACKSPACE HOSTING: Moody's Assigns 'Ba1' CFR, Outlook Stable
------------------------------------------------------------
Moody's Investors Service has assigned a first-time Ba1 corporate
family rating and a Ba1-PD probability of default rating to
Rackspace Hosting, Inc. Moody's has also assigned a Ba1 rating to
the company's proposed senior unsecured notes due 2024 and an SGL-1
speculative grade liquidity rating reflecting Rackspace's very good
liquidity. The proceeds from the notes will be used to repay the
company's existing revolving credit facility and to fund a portion
of its recently announced $1 billion share repurchase program. The
outlook is stable.
Assignments:
Issuer: Rackspace Hosting, Inc.
Corporate Family Rating, Assigned Ba1
Probability of Default Rating, Assigned Ba1-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Senior Unsecured Regular Bond/Debenture, Assigned Ba1, LGD4
Outlook Actions:
Outlook, Assigned Stable
RATINGS RATIONALE
Rackspace's Ba1 CFR reflects its low leverage, conservative
financial policy and strong free cash flow driven by stable
recurring revenues and steady EBITDA margins. Moody's expects
Rackspace to have leverage of 1.8x Debt/EBITDA (Moody's adjusted)
at the time of debt issuance declining to 1.5x over the next 12-18
months due to EBITDA growth. The company has a proven track record
of organic revenue growth, with quarterly sequential revenue growth
throughout the last five years. In contrast to most IT
infrastructure companies of its size, Rackspace has organically
built a highly profitable business within a dynamic, capital
intensive and rapidly growing industry. Its cost structure is
mostly variable, which has allowed margins to remain very
consistent despite the company's high growth. Growth via
acquisition remains an option for the company but is not a key
component of the Rackspace business model. The rating is
constrained by Rackspace's relatively small scale in an industry
dominated by large and well capitalized companies and the
technological and competitive threats inherent in the IT services
industry. In addition, the company's financial policy is well
articulated and conservative but does include a debt-financed share
repurchase program.
Rackspace is a leader in managed cloud services with a focus on
private/dedicated cloud products. Rackspace specializes in managed
hosting and dedicated, or single tenant, server architecture
products that offer customers strong performance and reliability
bundled with Rackspace's "Fanatical Support" customer service. The
company employs this service-driven strategy to differentiate
itself from larger operators that can leverage scale and undercut
Rackspace on price. Also, as customers attempt to migrate to cloud
architectures, the complexity and business risk they encounter will
often require a high level of customer service. Moody's believes
that Rackspace can maintain market share in the dedicated hosting
space by offering superior customer service, despite the strong
market momentum behind public cloud architectures.
The cloud computing industry is subject to continuous and rapid
evolution. Large competitors such as Amazon.com, Inc.'s (Baa1
Negative) Amazon Web Services (AWS) subsidiary, Google Inc. (Aa2
stable) and Microsoft Corporation's (Aaa Stable) Azure product
challenge the sustainability of the private cloud model. As more
software, especially newer applications, migrate to large public
clouds of AWS, Google and Azure, Rackspace will be forced to focus
on its differentiated service to maintain market share. Rackspace
has entered into reseller agreements with both Amazon and Microsoft
to mitigate this risk and to offer its customers a hybrid
public/private cloud architecture that leverages the benefits of
both the public and private platform types. Although AWS, Google
and Azure will capture a very high share of industry IT workload
growth, Moody's believes that the vast majority of enterprise and
small business IT workloads remain on legacy dedicated in-house
environments. This base provides a substantial target market of
customers whose applications may not be ready or suitable for
migration to a fully public cloud architecture. Rackspace can
address this market with its private or hybrid cloud products
bundled with its support model.
Rackspace has high capital intensity but the majority of spending
is directly linked to new customer sales. Capital spending
represents approximately 25% of revenues, but over two-thirds of
this supports growth and will vary in direct proportion to new
customer adds. Operating expenses are similarly variable, with a
mostly leased infrastructure that is highly scalable. The variable
cost structure and conservative financial leverage target of 1.5x
(including the PV of operating leases) offers a wide cushion in
Rackspace's credit profile and supports its Ba1 rating despite the
high level of technology and competitive risk.
Moody's expects Rackspace to have very good liquidity over the next
twelve months and has assigned an SGL-1 speculative grade liquidity
rating. The company generates positive cash flow each quarter and
has accumulated cash of $189 million as of Sept. 30, 2015.
Rackspace will also have an undrawn $200 million unsecured
revolving credit facility following the close of the transaction.
The ratings for debt instruments reflect both the probability of
default of Rackspace, to which Moody's assigns a PDR of Ba1-PD, and
individual loss given default assessments. The senior unsecured
notes are rated Ba1 (LGD4, 52%), in line with the CFR, given that
the newly issued notes will comprise the majority of debt in the
capital structure along with the unsecured, undrawn revolving
credit facility.
The stable outlook reflects Moody's view that Rackspace will
maintain its upward growth trajectory and steady margins as well as
continue to pursue a conservative financial policy, keeping
leverage near or below 1.5x EBITDA (Moody's adjusted).
The Ba1 rating could be subject to upgrade if EBITDA growth
continues, reflecting the company's ability to navigate the
headwinds of strong competitive threats in the industry. A rating
upgrade would also be predicated on management's continued
commitment to a conservative credit profile and discipline with
respect to shareholder friendly activities. The rating could be
pressured downward if revenues or margins deteriorate, which could
be due to a deterioration of Rackspace's market position. Also,
the rating could be downgraded if liquidity becomes strained, if
free cash flow deteriorates or financial policy shifts more in
favor of shareholders.
The principal methodology used in these ratings was Global
Communications Infrastructure Rating Methodology published in June
2011.
Based in San Antonio, TX., Rackspace is a multinational leader in
managed cloud services. The company has a global network and
offers broad IT solutions to its clients. The company generated
$1.95 billion in revenues for the last twelve months ended
9/30/2015.
RACKSPACE HOSTING: S&P Assigns 'BB+' CCR, Outlook Stable
--------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB+'
corporate credit rating to San Antonio, Texas-based Rackspace
Hosting Inc. The outlook is stable.
At the same time, S&P assigned a 'BB+' issue-level rating and '3'
recovery rating to the company's proposed $350 million senior
unsecured notes due 2024 and its $200 million amended senior
unsecured revolving credit facility. The '3' recovery rating
indicates S&P's expectation for meaningful (50%-70%, upper half of
the range) recovery in the event of a payment default.
The company will use the proceeds from the proposed senior
unsecured notes to pay down the outstanding balance on its
revolving credit facility and fund share repurchases.
"The rating on Rackspace primarily reflects the company's low pro
forma adjusted net leverage in the low-1x area along with its
scale, diverse product portfolio, good revenue visibility, and
extensive customer support that position it to take advantage of
the increasing demand for data and IT outsourcing," said Standard &
Poor's credit analyst Rose Askinazi.
Its operations in a highly competitive and fragmented industry and
its high capital intensity temper these factors; its adjusted
EBITDA margins are in the mid-30% area and its ratio of capital
expenditures to revenue is 25%.
The stable outlook reflects S&P's expectation for continued healthy
revenue growth, such that adjusted net leverage will remain in the
low-1x area over the next few years, inclusive of growth
initiatives and share repurchases.
S&P could lower the rating if operating performance weakens due to
competitive pressures from other data center operators and
third-party cloud providers, resulting in increased churn and
reduced profitability and causing S&P to view the business less
favorably. While less likely, S&P could lower the rating if
adjusted net leverage rises above 3x on a sustained basis. S&P
believes this would likely be the result of a large acquisition or
a more aggressive shareholder return policy.
S&P views an upgrade as unlikely given our uncertainty surrounding
the competitive environment over the next few years. However, S&P
could raise the rating if it views the business more favorably due
to increased confidence that public cloud providers will not erode
the company's market position. An upgrade would also entail
greater comfort around the company's longer-term financial policy
and capital allocation strategy as growth trends mature.
REIT COMMUNICATIONS: S&P Lowers CCR to 'B+', Outlook Stable
-----------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Little Rock, Ark.-based telecom REIT
Communications Sales & Leasing Inc. to 'B+' from 'BB-'. The rating
outlook is stable.
At the same time, S&P lowered its issue-level ratings on CS&L's
senior secured debt to 'BB-' from 'BB'. The recovery rating
remains '2', which indicates S&P's expectation for substantial
(70%-90%; lower half of the range) recovery in the event of payment
default.
S&P also lowered the issue-level rating on the company's senior
unsecured debt to 'B-' from 'B'. The recovery rating remains '6',
which indicates S&P's expectation for negligible (0%-10%) recovery
in the event of payment default.
S&P removed all ratings from CreditWatch, where it had placed them
with negative implications on Aug. 6, 2015.
"The rating downgrade follows the downgrade of Windstream based on
its weak operating performance, increased competitive pressures,
and a more aggressive financial policy," said Standard & Poor's
credit analyst Scott Tan.
Windstream is currently CS&L's sole tenant, with CS&L's business
entirely dependent on Windstream. Unless CS&L can meaningfully
diversify its customer base, S&P views the company's credit quality
as tethered to that of Windstream's.
The stable outlook reflects S&P's view that despite weak operating
performance at Windstream, CS&L is unlikely to experience cash flow
volatility over the near term, given that a large percentage of
cash flows are fixed under the lease structure.
S&P could downgrade CS&L if S&P lowered the ratings on Windstream
because of deteriorating operating and financial performance,
resulting in higher leverage. Additionally, S&P could lower the
rating if CS&L were to make a meaningful debt-financed acquisition
that resulted in leverage above 6.5x for an extended period of time
without a correspondent improvement in the company's business risk
profile.
S&P could upgrade CS&L if its primary tenant's credit quality
improves, prompting an upgrade of Windstream. S&P could also
upgrade CS&L if the company is able to diversify and improve the
quality of its tenant and asset base through acquisitions that
support an improved view of the overall business risk profile and
do not result in meaningfully higher leverage.
RELATIVITY MEDIA: CEO Denies Involvement With Hunter Killer Project
-------------------------------------------------------------------
Relativity Media LLC on Nov. 6 released a statement in Response to
Hunter Killer Parties' Objection to Debtor's Motion for an Order
Extending Their Exclusive Periods to File a Chapter 11 Plan.
"Relativity Chairman and CEO Ryan Kavanaugh had no personal
involvement with 'Hunter Killer' or anyone on this project prior to
or after starting development. This project, as with all
Relativity film projects post 2012, were run and overseen by
Relativity Studios' production leadership. Any claim to the
contrary that Kavanaugh was involved in anything improper is
patently false."
About Relativity
Relativity -- http://relativitymedia.com/-- is a next-generation
global media company engaged in multiple aspects of content
production and distribution, including movies, television, sports,
digital and music. More than just a collection of
entertainment-related businesses, Relativity is a content engine
with the ability to leverage each of these business units,
independently and together, to create content across all mediums,
giving consumers what they want, when they want it.
Relativity Studios, the Company's largest division, has produced,
distributed or structured financing for more than 200 motion
pictures, generating more than $17 billion in worldwide box-office
revenue and earning 60 Oscar nominations. Relativity's films
include Oculus, Safe Haven, Act of Valor, Immortals, Limitless, and
The Fighter.
Relativity Media LLC and its affiliates, including Relativity
Fashion, LLC, sought protection under Chapter 11 of the Bankruptcy
Code on July 30, 2015 (Bankr. S.D.N.Y., Case No. 15-11989). The
case is assigned to Judge Michael E. Wiles.
The Debtors are represented by Craig A. Wolfe, Esq., Malani J.
Cademartori, Esq., and Blanka K. Wolfe, Esq., at Sheppard Mullin
Richter & Hampton LLP, in New York; and Richard L. Wynne, Esq.,
Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq., at Jones Day, in
New York.
Brian Kushner of FTI Consulting, Inc., serves as chief
restructuring officer and crisis and turnaround manager. Luke
Schaeffer of FTI Consulting, Inc., serves as deputy CRO.
Blackstone Advisory Partners L.P. serves as the Debtors' investment
banker. The team is led by Timothy Coleman, Senior Managing
Director, CJ Brown, Senior Managing Director, Paul Sheaffer, Vice
President, and Joseph Goldschmid, Associate.
The Debtors' noticing and claims agent is Donlin, Recano & Company,
Inc.
* * *
An investor group composed of Anchorage Capital Group, L.L.C.,
Falcon Investment Advisors, LLC and Luxor Capital Group, LP on Oct.
21 completed its purchase of the assets of Relativity Television.
Macquarie Investments US Inc. withdrew its motion for adequate
protection or relief from the automatic stay after the Debtors
opted to only sell their TV business instead of substantially all
assets.
After selling their TV business, the Debtors say that they intend
to formulate a plan to restructure their business around their
remaining assets, including the Debtors' motion picture assets.
RELATIVITY MEDIA: Gets Nod on $35M Amended Ch. 11 Financing
-----------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that a New York
bankruptcy judge indicated on Nov. 2, 2015, that he would approve a
modified $35 million financing package to fund the rest of
Relativity Media's restructuring, after the Debtor and its lenders
modified the deal to address concerns that the proposal would would
essentially sidestep parts of the Chapter 11 process.
U.S. Bankruptcy Judge Michael Wiles said Relativity addressed all
of his concerns about the company's amended debtor-in-possession
financing "quite well and quite clearly" and would sign off on a
final order.
About Relativity
Relativity -- http://relativitymedia.com/-- is a next-generation
global media company engaged in multiple aspects of content
production and distribution, including movies, television, sports,
digital and music. More than just a collection of
entertainment-related businesses, Relativity is a content engine
with the ability to leverage each of these business units,
independently and together, to create content across all mediums,
giving consumers what they want, when they want it.
Relativity Studios, the Company's largest division, has produced,
distributed or structured financing for more than 200 motion
pictures, generating more than $17 billion in worldwide box-office
revenue and earning 60 Oscar nominations. Relativity's films
include Oculus, Safe Haven, Act of Valor, Immortals, Limitless,
and The Fighter.
Relativity Media LLC and its affiliates, including Relativity
Fashion, LLC, sought protection under Chapter 11 of the Bankruptcy
Code on July 30, 2015 (Bankr. S.D.N.Y., Case No. 15-11989). The
case is assigned to Judge Michael E. Wiles.
The Debtors are represented by Craig A. Wolfe, Esq., Malani J.
Cademartori, Esq., and Blanka K. Wolfe, Esq., at Sheppard Mullin
Richter & Hampton LLP, in New York; and Richard L. Wynne, Esq.,
Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq., at Jones Day,
in New York.
Brian Kushner of FTI Consulting, Inc., serves as chief
restructuring officer and crisis and turnaround manager. Luke
Schaeffer of FTI Consulting, Inc., serves as deputy CRO.
Blackstone Advisory Partners L.P. serves as the Debtors'
investment banker. The team is led by Timothy Coleman, Senior
Managing Director, CJ Brown, Senior Managing Director, Paul
Sheaffer, Vice President, and Joseph Goldschmid, Associate.
The Debtors' noticing and claims agent is Donlin, Recano &
Company, Inc.
* * *
An investor group composed of Anchorage Capital Group, L.L.C.,
Falcon Investment Advisors, LLC and Luxor Capital Group, LP on Oct.
21 completed its purchase of the assets of Relativity Television.
Macquarie Investments US Inc. withdrew its motion for adequate
protection or relief from the automatic stay after the Debtors
opted to only sell their TV business instead of substantially all
assets.
After selling their TV business, the Debtors say that they intend
to formulate a plan to restructure their business around their
remaining assets, including the Debtors' motion picture assets.
ROTONDO WEIRICH: Creditors Have Until Next Week to File Claims
--------------------------------------------------------------
Rotondo Weirich Enterprises Inc.'s creditors have until next week
to file their claims against the company.
Proofs of claim must be filed on or before the Nov. 20 deadline
approved by U.S. Bankruptcy Judge Eric Frank, who oversees the
company's bankruptcy case.
This deadline is called a "bar date" because it means that
creditors who come forward after that date may be "barred" from
ever filing a claim against the company.
Meanwhile, governmental units must file their claims on or before
Feb. 23, 2016, according to court filings.
About Rotondo Weirich
Rotondo Weirich Enterprises, Inc. and five of its affiliates sought
Chapter protection (Bankr. E.D. Pa. Case Nos. 15-16146 - 15-16151)
on Aug. 27, 2015. The petition was signed by Steven J. Weirich as
president & CEO. The Debtors disclosed total assets of $8,667,885
and total liabilities of $10,452,860. Maschmeyer Karalis P.C.
represents the Debtors.
On Sept. 22, 2015, Andrew Vara, acting U.S. trustee for Region 3,
appointed Grant Brooker, general counsel of Bennett Motor Express
LLC; Brett Smith, business manager of Bragg Companies; and Max
Helser, president of Helser Industries Inc., to serve on the
official committee of unsecured creditors.
On Oct. 15, 2015, another unsecured creditor, Mi-Jack Products Inc.
Vice-President Jack Wepfer, was appointed to serve on the panel.
The unsecured creditors' committee is represented by Reed Smith
LLP.
RR DONNELLEY: Moody's Puts Ba2 CFR on Review for Downgrade
----------------------------------------------------------
Moody's Investors Service placed RR Donnelley & Sons Company's
(RRD) Ba2 corporate family rating, its Ba2-PD probability of
default rating, its Ba3 senior unsecured notes' rating, and its
Baa2 senior secured bank credit facility rating on review for
downgrade. As part of the same rating action, the company's
speculative grade liquidity rating was lowered to SGL-3 from
SGL-2.
The action was prompted by market developments which suggest that
"The pace of digitization may be accelerating, a credit-negative
for many of RRD's business lines, and which may adversely affect
the consolidated company's ability to continue de-levering
activities at the pace required to support the existing Ba2 CFR"
said Bill Wolfe, a Senior Vice President at Moody's. One of the
market developments was the company's revision to its revenue
guidance. Together with management's related organic revenue
growth commentary, Moody's wonders whether underlying business
fundamentals have unexpectedly deteriorated, and Wolfe noted "As we
think about 2016 and 2017, there is the potential that RRD's debt
reduction capabilities may have been permanently adversely
affected." Additionally, Moody's noted that preparatory efforts to
split the company into three may be temporarily suppressing debt
reduction efforts, because of restructuring and other activities
which consume cash flow that would otherwise be allocated to debt
reduction.
Moody's expects to resolve the ratings review within approximately
60 to 90 days and, until RRD splits into three separate companies,
the agency assesses the company as currently configured (although
as the closing date approaches and additional facts are released,
Moody's may take ratings and outlook actions as warranted). In the
event that the company's ratings are downgraded, a more than one
notch adjustment is unlikely based on Moody's current assessment.
Moody's lowering of RRDs speculative grade liquidity rating to
SGL-3 (adequate) results from expectations that the company will
continue to rely on its revolving credit facility to assist with
repaying maturing debts as they come due (with the facility's
balance subsequently reduced from internally generated cash flow).
While RRD reduced its revenue guidance, the company indicated that
margins, at least through 2015, are modestly expanding.
Consequently, Moody's does not anticipate covenant compliance
issues over the next year or so but, as the company's guidance
revision highlights, visibility is limited and caution is
warranted.
RATINGS RATIONALE
Moody's will use the review period to evaluate RRD's 2016 and 2017
revenues, cash flow, and debt reduction potential, as well as its
leverage and liquidity. Market dynamics as they relate to
digitization of analogue communications, and the resulting volume
and price of analogue communications products and services will be
a focal point. The company's significant scale and its leadership
positions in many markets continue to be positive considerations.
During the past three years, Moody's has consistently characterized
RRD as being weakly positioned at the current Ba2 rating level
primarily because of elevated leverage. The matter was being
addressed slowly because some cash flow was being diverted to
ongoing efforts to re-position the company away from
printing-related activities, as well as to fund the company's
dividend, which consumes about 15% of EBITDA.
Summary of rating actions and RR Donnelley's ratings:
Issuer: R.R. Donnelley & Sons Company
On review for downgrade:
Outlook, Changed to On Review from Developing
Corporate Family Rating, Placed on Review for Downgrade,
currently Ba2
Probability of Default Rating, Placed on Review for Downgrade,
currently Ba2-PD
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Downgrade, currently Ba3 (LGD4)
Senior Secured Bank Credit Facility, Placed on Review for
Downgrade, currently Baa2 (LGD1)
Downgrade:
Speculative Grade Liquidity Rating, Lowered to SGL-3 From SGL-2
Corporate Profile
Headquartered in Chicago, Illinois, R.R. Donnelley & Sons Company
is North America's largest commercial printing company, with annual
revenues of approximately $11.4 billion of which 79% comes from
North American operations while 21% is international.
The principal methodology used in these ratings was Global
Publishing Industry published in December 2011.
SAINT MICHAEL'S MEDICAL: $15MM DIP Financing Has Final Approval
---------------------------------------------------------------
U.S. Bankruptcy Judge Vincent F. Papalia has entered a final order
authorizing Saint Michael's Medical Center, Inc., to obtain
postpetition financing from Trinity Health Corporation consisting
of a secured revolving credit facility in the principal amount of
up to $15 million to be used to fund cash flow shortfalls, general
working capital and liquidity purposes.
The deadline for the statutory committee of unsecured creditors to
challenge the Debtors' stipulations and releases in the Final Order
is Nov. 23, 2015. As a result of mediation, in consideration of
the Committee's consent to entry of the Final Order, the Debtors,
Trinity and the Committee have agreed on the principal terms of a
global settlement of any potential claims and causes of action that
are subject to the Committee's challenge period. The Committee
will have an unconditional, sole option, exercisable by giving
written notice on or before 5 p.m. on Nov. 23, to accept Trinity's
and the Debtors' offer to enter into a global settlement to be
approved by order of the Court in accordance with Bankruptcy Rule
9019.
A copy of the Final DIP Financing Order is available for free at:
http://bankrupt.com/misc/St_Michaels_282_Financing_Order.pdf
The salient terms of the DIP Facility are::
-- Revolving Loan Facility: Up to $15 Million.
-- Initial availability: $5 million upon entry of an interim
financing order.
-- Interest rate: 6 percent per annum, with the interest rising
to 8 percent per annum upon an event of default.
-- Due Date: The DIP Facility will have a maturity date of April
1, 2016.
-- Allowed Lender Claim: The Debtors will stipulate and agree to
an allowed general unsecured claim in favor of the DIP Lender in an
amount equal to $135,000,000, free from any offset, counterclaim or
defense. Any official committee of unsecured creditor may file an
objection to the claim on or before the later of: 75 days after the
entry of the Initial Interim DIP Order, and (ii) in the case of any
Committee, Nov. 23, 2015.
About Saint Michael's Medical Center
Saint Michael's Medical Center, Inc., was incorporated in 2008 to
acquire St. Michael's Medical Center and 2 other now defunct
hospitals (Saint James Hospital and Columbus Hospital) was
acquired from Cathedral Healthcare System Inc., a New Jersey
nonprofit.
SMMC is a second tier subsidiary of Trinity Health Corporation.
The immediate sole corporate member of SMMC is Maxis Health
System, a Pennsylvania not-for-profit corporation.
Established by the Franciscan Sisters of the Poor in 1867, St.
Michael's Medical Center is a 357- bed licensed regional
tertiary-care, teaching, and research center in the heart of
Newark, New Jersey's business and educational district and is
accredited by The Joint Commission.
On Aug. 10, 2015, SMMC Inc. and three affiliated debtors each
filed
a voluntary petition for relief under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
New Jersey. The cases are pending before the Honorable Vincent F.
Papalia, and the Debtors have requested that their cases be
jointly
administered under Case No. 15-24999.
The Debtors tapped Cole Schotz P.C. as bankruptcy counsel;
EisnerAmper LLP as financial advisor; and Prime Clerk LLC as
claims
and noticing agent.
SMMC estimated $100 million to $500 million in assets and debt.
United States Trustee Region 3, notified the United States
Bankruptcy Court for the District of New Jersey of the appointment
of Susan N. Goodman, RN JD, as patient care ombudsman in the
Chapter 11 case of Saint Michael's Medical Center, Inc., and its
debtor affiliates.
U.S. trustee for Region 3, appointed seven creditors of Saint
Michael's Medical Center Inc. and its affiliates to serve on the
official committee of unsecured creditors.
SARKIS INVESTMENTS: Plan Outline Hearing Continued to Jan. 27
-------------------------------------------------------------
The hearing to consider Sarkis Investments Company, LLC's Chapter
11 Disclosure Statement has been continued to Jan. 27, 2016, at
11:00 a.m.
The U.S. Trustee, the Debtor, and secured lender MSCI 2007-IQ13
Ontario Retail Limited Partnership have previously inked a
stipulation for a continuance based on the judicial economy to have
all matters heard at the same date and time as an expected motion
to sell the principal asset of the Debtor's estate; the outcome of
which would materially affect the status of the Debtor's case and
prospects of exiting its Chapter 11 proceeding.
The Debtor on March 4, 2014, filed a motion for approval of the
disclosure statement explaining its proposed Plan. The parties
later sought a continuance of the hearing several times.
The Plan proposes two alternative plans for reorganization. The
primary plan of reorganization (the "Primary Plan") proposes curing
the alleged monetary defaults caused by the receiver and repaying
the MSCI loan over a 10-year term on commercially reasonable terms.
The Debtor will use cash on hand and income derived from the
operation of the business during the 10-year term of the Plan to
pay any and all allowed claims. The alternative plan proposes
repaying any and all allowed claims over a three year-term, and,
after the three-year term, will sell or refinance the properties in
order to make any and all payments remaining under the Plan. A
copy of the Second Amended Disclosure Statement filed April 16,
2014, is available for free at http://is.gd/PIphBb
About Sarkis Investments Company
Sarkis Investments Company, LLC, filed a Chapter 11 petition
(Bankr. C.D. Cal. Case No. 13-29180) on July 29, 2013. Sarkis owns
and leases several parcels of commercial real property in Ontario,
California: 3550 Porsche Way; 3640 Porsche Way; 3660 Porsche Way;
3700 Inland Empire Blvd; and 3760 Inland Empire Blvd.
Judge Robert Kwan presides over the case. Pamela Muir signed the
petition as manager. The Debtor estimated assets and debts of at
least $10 million. Ashley M. McDow, Esq., at Baker & Hostetler,
LLP, serves as the Debtor's counsel.
Patrick Galentine was appointed by a state court as receiver for
the Debtor's assets. The receiver is represented by Reed Waddell,
Esq., at Frandzel Robins Bloom & Csato, LC.
MSCI 2007-IQ13 Ontario Retail Limited Partnership, which initiated
the receivership proceedings against Sarkis in state court, is
represented by Ron Oliner, Esq., at Duane Morris LLP.
In April 2014, the Debtor filed a Second Amended Reorganization
Plan and Disclosure Statement. The Debtors seeks to accomplish
payments under the plan by paying creditors on account of their
allowed claims in full over time from cash flows generated from
future operations or the proceeds from the sale of the Company or
the properties.
SEQUENOM INC: Incurs $9.4 Million Net Loss in Third Quarter
-----------------------------------------------------------
Sequenom, Inc., filed with the Securities and Exchange Commission
its quarterly report on Form 10-Q disclosing a net loss of $9.44
million on $29.9 million total revenues for the three months ended
Sept. 30, 2015, compared to a net loss of $6.07 million on $37.9
million of total revenues for the same period during the prior
year.
For the nine months ended Sept. 30, 2015, the Company recorded a
net loss of $4.17 million on $100 million of total revenues
compared to a net loss of $17.3 million on $115 million of total
revenues for the same period a year ago.
As of Sept. 30, 2015, the Company had $129 million in total assets,
$156 million in total liabilities and a $27.7 million total
stockholders' deficit.
"We are excited by the launch of the MaterniT GENOME
laboratory-developed test and the enthusiastic reception it has
received from the maternal fetal medicine specialist community.
With MaterniT GENOME, Sequenom Laboratories is once again
introducing a new paradigm in prenatal testing, which has the
potential to increase Sequenom's revenue and market share," said
Dr. Dirk van den Boom, interim president and chief executive
officer of Sequenom, Inc. "During the third quarter, we also
announced several collaborations with key opinion leaders for the
advancement of our circulating cell-free tumor DNA assays, opening
new market opportunities for Sequenom in oncology. Finally, we
initiated a focused review of the Company's commercial operations,
cost structure, and new product programs, and we plan to implement
changes in these areas in the coming quarters that will improve
revenues and reduce costs."
As of Sept. 30, 2015, total cash, cash equivalents, and marketable
securities was $80.4 million.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/d8ENcm
About Sequenom
Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a
life sciences company committed to improving healthcare through
revolutionary genetic analysis solutions. Sequenom develops
innovative technology, products and diagnostic tests that target
and serve discovery and clinical research, and molecular
diagnostics markets. The company was founded in 1994 and is
headquartered in San Diego, California.
"If we fail to generate enough cash flow from our operations or
otherwise obtain the capital necessary to fund our operations, our
financial results, financial condition and our ability to continue
as a going concern will be adversely affected and we will have to
cease or reduce further commercialization efforts or delay or
terminate some or all of our diagnostic testing services or other
product development programs," the Company said in its 2014 annual
report.
SNOHOMISH COUNTY: Fitch Affirms B Rating on Series 2004 LTGO Bonds
------------------------------------------------------------------
Fitch Ratings has taken the following rating action on Snohomish
County Public Hospital District #1's (the district) limited tax
general obligation (LTGO) bonds:
-- $1.9 million series 2004 affirmed at 'B'.
The Rating Outlook is revised to Stable from Negative.
SECURITY
The bonds are backed by a full faith and credit general obligation
pledge of the district. The district also irrevocably pledges to
annually levy and collect property taxes within the constitutional
and statutory limits to pay debt service on the bonds.
KEY RATING DRIVERS
WEAK BUT STABILIZING FINANCES: The district continues to face
financial strains, but operations have stabilized following its
affiliation with a neighboring public hospital district. In
addition, the 2014 approval by local voters of an increased tax
levy has helped reduce liquidity pressures.
STRONG TAX BASE; LIMITED BENEFIT: The strong tax base provides only
limited rating impact because property tax revenues are not
available for operations. The current rating closely reflects the
district's financial condition.
LIMITED LONG-TERM LIABILITIES: The district has few long-term
liabilities apart from tax-supported debt. Overall debt levels are
moderate.
RATING SENSITIVITIES
REDUCED FINANCIAL FLEXIBILITY: An increase in operating losses or
reduction in liquidity could increase insolvency risks for the
district and would pressure the current rating. Improving financial
flexibility would create upward pressure on the rating.
CREDIT PROFILE
Snohomish County Public Hospital District No. 1 is located in
eastern Snohomish County, Washington, about 30 miles northeast of
Seattle on the outskirts of the Puget Sound region. The district
owns and operates Valley General Hospital in Monroe and the Valley
General Chemical Dependency Treatment Center. In 2012 the district
executed an affiliation agreement with Evergreen Health Services, a
neighboring public hospital district based in Kirkland, Washington,
and has subsequently re-branded its services as
EvergreenHealth-Monroe.
WEAK BUT STABILIZING FINANCES
The district's financial position remains weak but has begun to
show signs of improvement. Operating losses decreased in fiscal
2014 for the first time in six years. Unrestricted net assets
continue to be negative but reversed a five-year downward
trajectory.
Cash levels were weak at the end of fiscal 2014 but showed gains
relative to 2013. Interim results as of August 2015 also reflect
weak liquidity, with about eight days of cash on hand
(approximately $751,000) but were slightly above cash levels from
one year earlier. The district retains a $500,000 credit line but
had no draws upon it as of Aug. 31, 2015.
AFFILIATION AND TAX MEASURE KEY
The district executed an affiliation agreement with Evergreen
Health Services, a neighboring public hospital district based in
Kirkland, Washington, in December 2012 following several years of
efforts to forge new partnerships. Evergreen now manages the
district's hospital and clinics under the agreement, and has
established a new board to oversee district operations. The
district's board retains legal and financial responsibility for the
district but no longer oversees operations directly.
Increased integration of the district's services with Evergreen has
begun to impact financial results, but the small size of its
operations and a competitive regional market will likely contribute
to ongoing volatility. The temporary loss of an orthopedic surgeon
in late 2015, for example, has reduced surgical volumes and net
patient revenues, reducing overall profitability below previously
projected levels. Fitch expects the district's financial position
to continue to strengthen over the next several years.
The district's finances have been bolstered by local voters' 2013
approval of an increased property tax levy. The additional levy
provides the district with about $2.4 million per year, or
approximately 7% of 2014 operating revenues. Most of the district's
property tax levy prior to 2013 was utilized for debt service; the
recent increase provides new support for the district's operations.
STRONG UNDERLYING TAX BASE OF LIMITED RATING BENEFIT
The district's underlying tax base is large and diverse but was
severely impacted by the recession. Taxable assessed values (TAV)
fell by one-third between 2008 and 2013 before a 21% cumulative
increase in 2014 and 2015. Tax revenues, however, have been stable
due to Washington's automatic adjustment of tax rates to allow for
1% annual increases in the tax levy.
The district's tax levy is subject to a constitutional cap on
overlapping tax rates of $5.90/$1,000 TAV. Certain tax rate areas
within the district began to approach this limit following TAV
declines during the last recession, but renewed tax base growth
over the past two years appears to have alleviated this risk.
LIMITED LONG-TERM LIABILITIES
Overall debt levels for the district are moderate at approximately
$3,635 per capita and 3.1% of TAV. Amortization is below average as
a result of the district's 2009 issuance of additional GO debt,
with 39% of outstanding principal due for payment within 10 years.
Debt service requirements for the district are small relative to
the size of its operations and accounted for approximately 3.4% of
expenditures in 2014. The district does not provide a defined
benefit pension or other-post employment benefits to its
employees.
SOMERSET REGIONAL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Somerset Regional Water Resources, LLC
139 E. Union Street
Somerset, PA 15501
Case No.: 15-70766
Chapter 11 Petition Date: November 9, 2015
Court: United States Bankruptcy Court
Western District of Pennsylvania (Johnstown)
Debtor's Counsel: Robert O Lampl, Esq.
ROBERT O LAMPL, ATTORNEY AT LAW
960 Penn Avenue, Suite 1200
Pittsburgh, PA 15222
Tel: 412-392-0330
Fax: 412-392-0335
Email: rol@lampllaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Larry Mostoller, managing member.
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Admar Supply Company, Inc. Business Debt $255,149
1950 Bri Hen Tl Road
Rochester, NY 14623-2510
B&M Seasonal Services, LLC Business Debt $500,893
RR #6
Box 351 Chapel Road
Pittston, PA 18640
Baker Tilly Virchow Krause, LLC Business Debt $149,155
C. Haer Trucking Business Debt $785,654
145 Mostoller Road
Somerset, PA 15501
Complete Fluid Control, Inc. Business Debt $272,301
9 Skyline Drive, E Suite 2
Clarks Summit, PA 18411
DNV Energy LLC Business Debt $205,106
First Insurance Funding Corp. Business Debt $154,907
FleetOne, LLC Business Debt $200,098
G & W Trucking, LLC Business Debt $209,340
G. Thomas Trucking, LLC Business Debt $697,571
11 Woodcrest Drive
Clarendon, PA 16313
Instant Growth Hydroseeding Business Debt $140,740
IRS Withholding Tax $1,075,000
PO Box 37009
Hartford, CT 06176-0009
Kenworth of Pennsylvania Business Debt $162,076
Majelus, LLC Business Debt $274,806
1380 Mt. Cobb Road
Lake Ariel, PA 18436
Midwest Oil Field Services Business Debt $128,316
NES Rentals Business Debt $159,785
Patrik's Water Hauling Business Debt $227,500
Strong's Trucking Inc. Business Debt $131,891
Waste Management Business Debt $168,670
Wex Bank Business Debt $135,030
SP KOROLEV: Boeing's Bid for Severe Sanctions Denied
----------------------------------------------------
Daniel Siegal at Bankruptcy Law360 reported that a California
federal judge on Oct. 30, 2015, slammed Russia's state-controlled
space company for its "feeble" excuses for withholding core
evidence in Boeing Co.'s $355 million lawsuit over a failed
satellite-launching venture, but he ruled he cannot grant the
"severe" sanctions requested by Boeing.
In an order filed on Oct. 30, 2015, U.S. Magistrate Judge Andrew
Wistrich denied Boeing's bid for sanctions against SP Korolev
Rocket and Space Corp. Energia for refusing to comply with a nearly
year-old court order to hand over official investigative reports
from the Russian government.
SPARTAN CONSTRUCTION: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Spartan Construction Incorporated
dba Pipeline Drainage Consultants
aka Spartan Construction
dba Spartan Construction of KY, Inc.
dba Spartan Construction of AK, Inc.
1619 Distribution Drive
Burlington, KY 41005
Case No.: 15-21581
Chapter 11 Petition Date: November 9, 2015
Court: United States Bankruptcy Court
Eastern District of Kentucky (Covington)
Debtor's Counsel: Michael B. Baker, Esq.
THE BAKER FIRM, PLLC
2131 Chamber Center Drive
Ft. Mitchell, KY 41017
Tel: (859) 647-7777
Fax: (859) 647-7799
Email: mbaker@bakerlawky.com
Total Assets: $3.74 million
Total Liabilities: $3.17 million
The petition was signed by Dianne Brossart, president.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/kyeb15-21581.pdf
STEREOTAXIS INC: Reports $997,000 Net Loss for Third Quarter
------------------------------------------------------------
Stereotaxis, Inc., filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $996,926 on $9.27 million of total revenue for the three months
ended Sept. 30, 2015, compared to net income of $22,670 on $8.85
million of total revenue for the same period during the prior
year.
For the nine months ended Sept. 30, 2015, the Company recorded a
net loss of $5.67 million on $28.46 million of total revenue
compared to a net loss of $6.05 million on $25.25 million of total
revenue for the same period a year ago.
As of Sept. 30, 2015, the Company had $18.63 million in total
assets, $35.21 million in total liabilities and a $16.57 million
total stockholders' deficit.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/HYP5st
About Stereotaxis
Based in St. Louis, Missouri, Stereotaxis, Inc., is a manufacturer
and developer of a suite of navigation systems in interventional
surgical procedures. The Company's Epoch Solution is used in the
treatment of arrhythmias and coronary artery disease.
Stereotaxis reported a net loss of $5.20 million in 2014, a net
loss of $68.8 million in 2013 and a net loss of $9.23 million in
2012.
Ernst & Young LLP, in St. Louis, Missouri, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2014, citing that the Company has incurred recurring
operating losses and has a net capital deficiency. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
SUMMIT STREET: To Seek Approval of Ch. 11 Plan on Nov. 24
---------------------------------------------------------
Summit Street Development Company, LLC, will seek confirmation of
its reorganization plan and final approval of its disclosure
statement at a combined hearing on Nov. 24, 2015.
Judge John T. Gregg on Sept. 25, 2015, entered an order
conditionally approving the Disclosure Statement and setting:
-- A Nov. 16 deadline by which ballots must be filed.
-- A Nov. 16 deadline for objections to the Disclosure Statement
and Plan.
-- A deadline no later than 7 days prior to the confirmation
hearing for filing by the Debtor of a brief in support of
confirmation.
-- A consolidated hearing on Nov. 24, 2015 at 9:00 a.m. regarding
final approval of the disclosure statement and confirmation of the
Plan.
The Debtor on Oct. 22, 2015, filed an Amended Combined Plan of
Reorganization and Disclosure Statement.
Summit Street has filed a reorganization plan that proposes to (i)
pay creditors in full via installment payments for five years, and
(ii) let majority owner Harry H. Hepler retain control of the
company if the plan is accepted by unsecured creditors.
The Plan specifically treats claims and interests as follows:
-- The $4.71 million secured debt to Wolverine Bank (Class 1)
will be paid with monthly payments of interest for the first year,
monthly payments of principal and interest throughout the remainder
of a five-year term, with the balloon payment on the fifth
anniversary of the Effective Date.
-- Allowed general unsecured claims (Class 2), which is
scheduled in the amount of $386,000, will accrue interest at the
Interest Rate commencing on the Effective Date and holders of the
claims be paid 100% their allowed claims, payable in five annual
installments, with the first payment on or before 60 days after the
Effective Date.
-- Holders of equity interests (Class 3) will be treated in one
or two alternative methods:
(i) If Class 2 votes to accept the Plan, the holders of
Class 3 interests will retain their interests.
(ii) If Class 2 votes to reject the Plan and the Plan is
nonetheless confirmed, the interests of the Debtor will be
cancelled and the interests of the Reorganized Debtor will be sold
at an auction.
Since the Petition Date Harry Hepler, through his related entities
Motor Wheel Lofts, LLC and H, Inc., has contributed $123,520 to
fund Debtor's continued operations, tax escrow payments, and
interest payments to the Bank. Additionally, Mr. Hepler has agreed
to continue supporting Debtor's on-going operations to the extent
necessary, including funding any deficiency of plan payments and
operating expenses to the extent such payments and expenses cannot
be funded from Debtor's revenues.
Mr. Helper also is the majority interest holder and manager of
Motor Wheel Lofts, LLC, East Grand River, LLC and H, Inc. The
Debtor owes companies owned by Mr. Helper, namely, Motor Wheel
Lofts, LLC, East Grand River, LLC and H, Inc., $177,106, $32,642,
$68,948, respectively, for accommodations and loans made before the
Petition Date. The Plan subordinate repayment of these amounts to
all non-insider claims, and no payments will be made until
Reorganized Debtor satisfies all non-Insider Claims in full as
required by the Plan.
A copy of the Amended Combined Plan of Reorganization and
Disclosure Statement filed Oct. 22, 2015, is available for free at
http://bankrupt.com/misc/Summit_S_68_Am_Plan_DS.pdf
About Summit Street
Summit Street Development, L.L.C., operates a commercial office
space within the historically adapted Prudden Tech Centre at 700
May Street in the City of Lansing, County of Ingham, State of
Michigan. The facility includes approximately 124,000 square feet
of leasable space and 850 parking spaces.
The current office tenants are C2AE and H Inc. H Inc. has
committed to executing a new lease for the white-box space as it
is
completed. Additionally Gym space will be rented on an hourly or
per event basis by Summit Street to the public.
Harry H. Hepler owns 86.67% of the equity interests, and Barbara
Hepler owns the remaining 13.33%.
Summit Street sought Chapter 11 protection (Bankr. W.D. Mich. Case
No. 14-07339) in Grand Rapids, Michigan, on Nov. 21, 2014. The
case is assigned to Judge John T. Gregg. Harry H. Hepler, as
managing member, signed the petition.
Ryan D. Heilman, Esq., at Wolfson Bolton PLLC, in Troy, Michigan,
serves as counsel.
The Debtor, in amended schedules, disclosed $10,728,442 in assets
and $5,095,775 in liabilities as of the Chapter 11 filing.
SUMMIT STREET: Wolverine Bank Says Plan Unconfirmable
-----------------------------------------------------
Sarkis Investments Company, LLC's proposed plan of reorganization
is unconfirmable given that it violates 11 USC Sec. 1129, Wolverine
Bank said in an Oct. 9 objection to the Disclosure Statement.
Wolverine Bank claims, among other things, that the Debtor has
failed to show how the Plan is feasible and has failed to
adequately provide for payment to the Bank and attempts to
improperly enjoin the Bank's suit against a non-debtor without any
statutory authority.
The Bank says the Disclosure Statement fails to provide any
information as to any verification or quantification showing that
Harry H. Hepler, the Debtor's majority owner, can and will cover
the shortfalls for each year of the Debtor's five year plan. It
notes that while Mr. Hepler has covered the operating deficiencies
post-petition, there is no disclosure as to how to verify or
quantify that Mr. Hepler will and can continue to cover the
continuing deficiencies for five years. It adds that there is
absolutely no disclosure to any creditors as to how the Debtor
proposes to pay the $4.2 plus million balloon payment owed to the
Bank at the end of the five-year period.
Wolverine Bank also has an issue with the Debtor's proposal of
using an undisclosed Treasury Bill Rate to pay the Bank at 4.5%
interest. It says the Debtor failed to disclose what Treasury Bill
Rate the Debtor proposes to use as its index and why it chose a
Treasury Bill Rate rather than the Prime Rate as used by the United
States Supreme Court.
Wolverine Bank's attorneys can be reached at:
PLUNKETT COONEY
David A. Lerner, Esq.
38505 Woodward Ave., Ste. 2000
Bloomfield Hills, MI 48304
Tel: (248) 901-4010
E-mail: dlerner@plunkettcooney.com
About Summit Street
Summit Street Development, L.L.C., operates a commercial office
space within the historically adapted Prudden Tech Centre at 700
May Street in the City of Lansing, County of Ingham, State of
Michigan. The facility includes approximately 124,000 square feet
of leasable space and 850 parking spaces.
The current office tenants are C2AE and H Inc. H Inc. has
committed to executing a new lease for the white-box space as it
is
completed. Additionally Gym space will be rented on an hourly or
per event basis by Summit Street to the public.
Harry H. Hepler owns 86.67% of the equity interests, and Barbara
Hepler owns the remaining 13.33%.
Summit Street sought Chapter 11 protection (Bankr. W.D. Mich. Case
No. 14-07339) in Grand Rapids, Michigan, on Nov. 21, 2014. The
case is assigned to Judge John T. Gregg. Harry H. Hepler, as
managing member, signed the petition.
Ryan D. Heilman, Esq., at Wolfson Bolton PLLC, in Troy, Michigan,
serves as counsel.
The Debtor, in amended schedules, disclosed $10,728,442 in assets
and $5,095,775 in liabilities as of the Chapter 11 filing.
TEAM HEALTH: Moody's Lowers CFR to Ba3 & Rates $965MM Loan Ba2
--------------------------------------------------------------
Moody's Investors Service downgraded Team Health, Inc.'s Corporate
Family Rating to Ba3 from Ba2 and Probability of Default Rating to
Ba3-PD from Ba2-PD. Concurrently, Moody's assigned a Ba2 rating to
Team Health's proposed $965 million senior secured term loan B and
a B2 rating to the company's proposed $545 million senior unsecured
notes. Moody's also confirmed the Ba2 rating of Team Health's
existing $650 million revolver and $585 million senior secured term
loan A, given first-loss absorption that will now be provided by
the unsecured debt in the capital structure.
In addition, Moody's lowered the Speculative Grade Liquidity Rating
to SGL-2 (signifying good liquidity) from SGL-1 (very good
liquidity). The rating outlook is negative.
This action concludes the ratings review on Team Health that
Moody's initiated on August 4, 2015 as a result of the company's
announcement that it had agreed to acquire IPC Healthcare, Inc.
("IPC Healthcare") for $1.6 billion.
The downgrade of Team Health's CFR reflects the near tripling of
the company's debt upon completion of its acquisition of IPC
Healthcare. Moody's believes pro forma LTM debt to EBITDA for the
transaction is 5.8 times (including synergies), for the period
ended September 30, 2015, which is high for the Ba3 rating
category. However, the acquisition will meaningfully reduce
concentration in emergency department staffing and gives Team
Health greater scale in the staffing of physician hospitalists.
Moody's also believes there is modest integration risk.
Summary of rating actions:
Team Health, Inc.:
Ratings downgraded:
Corporate Family Rating to Ba3 from Ba2
Probability of Default Rating to Ba3-PD from Ba2-PD
Speculative Grade Liquidity Rating to SGL-2 from SGL-1
Ratings assigned:
$965 million senior secured term loan B due 2022 at Ba2 (LGD 3)
$545 million senior unsecured notes due 2023 at B2 (LGD 6)
Ratings confirmed:
$650 million senior secured revolver expiring 2019 at Ba2
(LGD 3)
$600 million senior secured term loan A due 2019 at Ba2 (LGD 3)
The outlook is negative.
RATINGS RATIONALE
The Ba3 Corporate Family Rating reflects Moody's expectation that
the company will operate with high financial leverage, following
its planned acquisition of IPC Healthcare, yet rapidly delever to
about 4 times over the next 18 months. Moody's also considers the
benefits of the company's strong competitive position in a highly
fragmented industry and stable cash flow. However, risks around
reimbursement and exposure to uninsured individuals could pressure
revenue and earnings growth in the near to medium term. Moody's
also expects that the company will remain aggressive in its pursuit
of acquisitions, but that it will fund transactions in a manner
that maintains the company's ability to deleverage.
Team Health's negative outlook considers the company's heightened
debt leverage resulting from its aggressive financial policy and
the increased likelihood of a downgrade if financial metrics do not
improve in the near-term.
If the company fails to make progress achieving debt to EBITDA
closer to 4.0 times over the next 18-months, the rating could be
downgraded. Additionally, if the company were to pursue
significant debt-financed acquisitions or shareholder initiatives
beyond our expectation or, experience integration difficulties with
IPC that result in deterioration of financial metrics, the ratings
could be downgraded.
Although an upgrade is unlikely in the near-term, if the company is
able to meaningfully reduce leverage by growing earnings or
repaying debt there could be upward pressure on the ratings.
Specifically, if adjusted debt to EBITDA is reduced and is expected
to remain below 3.0 times, Moody's could upgrade the ratings.
Moody's would also have to become more comfortable that the company
would refrain from other large, leveraging transactions.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in December 2014.
Team Health is a provider of physician staffing and administrative
services to hospitals and other healthcare providers in the U.S.
The company is affiliated with more than 14,000 healthcare
professionals who provide emergency medicine, hospital medicine,
anesthesia, urgent care, pediatric staffing and management
services. The company also provides a full range of healthcare
management services to military treatment facilities. Team Health
recognized approximately $3.4 billion in net revenue for the twelve
months ended Sept. 30, 2015.
TEEKAY CORP: Moody's Assigns B2 Rating on $200MM Notes Add-On
-------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to the $200 million
add-on to Teekay Corporation's existing 8.5% senior unsecured notes
due Jan. 15, 2020, (8.5% Notes). Teekay will use the proceeds to
pay some revolver outstandings with the remainder going to cash.
The Corporate Family rating of Teekay is B1. The rating outlook is
stable.
Ratings Rationale
The add-on notes are being issued under a supplement to the
indenture of the 8.5% Notes and have the same terms, conditions and
maturity date.
The B1 Corporate Family rating reflects Teekay's leading position,
through its subsidiaries that it controls, as a provider of
maritime transportation of oil, gas and refined petroleum products,
and an operator of FPSOs (floating production, storage and off-take
units). Moody's believes that the long-term contracts on the
majority of the Teekay family's LNG and non-conventional tankers
offset the highly leveraged profile of the company. Given this,
Moody's expects that the cash flows to the parent can continue in
upcoming years. An overwhelming majority of the company's offshore
vessels are tied to production rather than exploration, lowering
market risk relative to service-providers to oil exploration
operations.
The B1 Corporate Family rating also reflects Moody's expectation
that Teekay Parent will strengthen its stand-alone credit profile
via the dropdown (sale) of its remaining three FPSOs, together with
the debt secured by these vessels, to Teekay Offshore Partners by
the end of 2017. Elimination of this debt from the Parent's
balance sheet is expected to occur, either by pay off with sale
proceeds or transfer to Teekay Offshore. Parent debt at Sept. 30,
2015, stood at about $1.0 billion, following the sale of the Knarr
FPSO in July 2015. Parent debt is about $200 million higher than
Moody's anticipated because Teekay Parent took more equity in place
of cash than expected when dropping down the vessel to Teekay
Offshore. Teekay Parent will have no remaining operating assets
following the disposal of the one Very Large Crude Carrier and
FPSOs that it owns. The rating considers the distributions and
dividends that the Parent receives from its publicly-listed
subsidiaries, about $193 million for the twelve months ended Sept.
30, 2015, based on ownership of between 25% and 36% of each. This
source of cash will fund the Parent's G&A and interest expense
burden with ease, the remainder of which will be distributed to
shareholders via ordinary dividends. Moody's believes that this
source of cash flow will increase in the future, as the daughter
companies increase their distributions with the growth of their
fleets. The B1 rating anticipates that Teekay Parent will maintain
adequate liquidity and no longer use its balance sheet to directly
invest in new projects or vessels. Repayment of secured debt with
vessel sale proceeds will further reduce funded debt, lending
additional support to the B1 rating.
Moody's foresees no upwards pressure on the ratings during the next
few years. Successful execution of the asset disposal strategy
such that Teekay Parent sustains its net debt below
$300 million could positively pressure the rating as could Debt to
EBITDA that approaches 3.0 times.
A negative rating action could follow if Teekay Parent does not
fully transfer or repay the secured debt associated with each of
its vessels upon their disposal. While not expected, a decline of
more than $40 million in the annual distributions received by
Parent could pressure the rating as could another increase in
funded debt should Parent unexpectedly directly invest in growth
projects. A reduction in Parent's unrestricted cash to below $125
million or the inability of Parent or a subsidiary to timely
refinance upcoming debt maturities could also lead to a negative
rating action. The ratings may also be downgraded if the recent
declines in the market capitalizations of its MLP subsidiaries,
Teekay LNG Partners L.P. (TGP) and/or Teekay Offshore Partners L.P.
(TOO), are sustained beyond 2016. A decline in the distributions
made by either of these two companies would reduce the cash flow
Parent receives. This would further pressure the market prices of
the limited partnership units and could also pressure the ratings.
Repurchases of Parent's common shares could also result in a
ratings downgrade if made before a majority of its debt is repaid
or assumed by the daughters with no contractual recourse to Teekay
Parent.
The principal methodology used in this rating was Global Shipping
Industry published in February 2014.
Teekay Corporation, a Marshall Islands Corporation headquartered in
Bermuda with executive offices in Vancouver Canada, is an
operational leader and project developer in the marine midstream
space. Through its general partnership interests in two master
limited partnerships (MLPs), Teekay LNG Partners L.P. (NYSE: TGP,
unrated ) and Teekay Offshore Partners L.P. (NYSE: TOO, unrated),
its controlling ownership of Teekay Tankers Ltd. (NYSE: TNK,
unrated) and its fleet of directly-owned vessels and offshore
units, Teekay is responsible for managing and operating
consolidated vessel assets with a book value of about $9.4 billion,
comprised of 215 liquefied gas, offshore, and conventional tanker
assets, including vessels on order or under conversion, and
ownership interests in a number of joint ventures. Teekay provides
a comprehensive set of marine services to the world's leading oil
and gas companies. It and its subsidiaries have common management
and the subsidiaries have conflict committees to assure
transactions between the group's various units are conducted at
arm's length. The company reported consolidated revenue of $2.3
billion for the twelve months ended Sept. 30, 2015.
TLC SCHOOL BUS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: TLC School Bus Company, LLC
5601-07 Tulip Street
Philadelphia, PA 19153
Case No.: 15-18042
Chapter 11 Petition Date: November 9, 2015
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Hon. Ashely M. Chan
Debtor's Counsel: Thomas Daniel Bielli, Esq.
BIELLI & KLAUDER, LLC
1500 Walnut Street, Suite 900
Philadelphia, PA 19102
Tel: 215-642-8271
Fax: 215-754-4177
Email: tbielli@bk-legal.com
- and -
Cory P. Stephenson, Esq.
BIELLI & KLAUDER, LLC
1500 Walnut Street, Suite 900
Philadelphia, PA 19102
Tel: 215-642-8271
Fax: 215-754-4117
Email: cstephenson@bk-legal.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Tracey Leahy, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
VANTIV LLC: S&P Raises CCR to 'BB+', Outlook Stable
---------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Vantiv LLC to 'BB+' from 'BB.' The outlook is stable.
S&P also raised the issue-level rating to 'BBB-' from 'BB+' on the
company's senior secured credit facility, which consists of a $2.05
billion term A loan, a $1.4 billion term B loan, and $425 million
revolving credit facility. There is no change to the '2' recovery
rating, which indicates S&P's expectation for substantial (70% to
90%; upper half of the range) recovery of principal in the event of
default.
"The upgrade reflects our view of Vantiv's deleveraging following
its debt-financed acquisition of Mercury Payment Systems LLC for
$1.7 billion," said Standard & Poor's credit analyst Peter
Bourdon.
The stable outlook on Ohio-based payment processing services
provider Vantiv LLC reflects S&P's expectation that the company
will continue to achieve organic revenue growth, stable to
improving EBITDA margins, and leverage in the 3x-4x range in 2016.
WBH ENERGY: Creditors' Committee Dissolved as of Effective Date
---------------------------------------------------------------
WBH Energy, LP, et al., notified the U.S. Bankruptcy Court for the
Western District of Texas of the dissolution of the Official
Creditors Committee as of the Effective Date of the First Amended
Joint Plan of Reorganization.
The Effective Date of the Plan occurred on Sept. 9, 2015.
Based on the terms of the Plan, the Committee is dissolved, and the
members of the Committee are released and discharged from all
authority, duties, responsibilities, and obligations related to,
arising from, or in connection with the cases.
About WBH Energy
WBH Energy Partners LLC (Bankr. W.D. Tex. Case No. 15-10004) and
its affiliates -- WBH Energy, LP (Bankr. W.D. Tex. Case No.
15-10003) and WBH Energy GP, LLC (Bankr. W.D. Tex. Case No.
15-10005) separately filed for Chapter 11 bankruptcy protection on
Jan. 4, 2015. The petitions were signed by Joseph S. Warnock,
vice president.
Judge Christopher Mott presides over WBH Energy, LP's case, while
Judge Tony M. Davis presides over WBH Energy Partners' and WBH
Energy GP's cases.
William A. (Trey) Wood, III, Esq., at Bracewell & Giuliani LLP,
serves as the Debtors' bankruptcy counsel.
WBH Energy, LP, and WBH Energy Partners estimated their assets and
liabilities at between $10 million and $50 million each. WBH
Energy, LP disclosed $557,045 plus an unknown amount and
$48,950,652 in liabilities as of the Chapter 11 filing. WBH
Energy GP estimated its assets at up to $50,000, and its
liabilities at between $10 million and $50 million.
The U.S. Trustee for Region 7 appointed seven creditors to serve
On the official committee of unsecured creditors.
WELLCARE HEALTH: Moody's Gives (P)Ba2 Rating on Shelf Registration
------------------------------------------------------------------
Moody's Investors Service has assigned provisional debt ratings
(senior debt at (P)Ba2) to WellCare Health Plans, Inc.'s (NYSE:
WCG, WellCare's) new shelf registration statement. The outlook on
the ratings is stable. WellCare maintains its shelf registration
statement for general corporate purposes, including repayment or
refinancing of debt, funding investments in subsidiaries, financing
acquisitions, repurchase of outstanding securities and working
capital needs.
RATINGS RATIONALE
Moody's said that the new shelf replaces WellCare's previous shelf
registration statement, which expired in August 2015.
The rating agency said the Ba2 senior unsecured debt rating for
WellCare and Baa2 insurance financial strength (IFS) rating for
WellCare of Florida, Inc. (WCFL) are supported by the company's
good financial profile, characterized by adequate and consistent
operating earnings, and strong cash flow including a stream of
unregulated cash flows from management fees. However, the rating
also reflects a somewhat weaker business profile, largely the
result of the exclusive focus on the Medicare and Medicaid segments
with over 60% of the company's premium revenue from Medicaid
contracts.
The rating agency said that WellCare's ratings could be upgraded
if: 1) there was continued geographical expansion of the company's
Medicaid and Medicare products, 2) the consolidated risk-based
capital (RBC) ratio is improved to and maintained at least at 200%
of company action level (CAL), 3) cash flow coverage ratio improves
to at least 6x, and 4) debt to EBITDA is 1.5x or lower. Moody's
added that on the other hand, the following could result in a
rating downgrade: 1) loss or impairment of one of the company's
major government contracts, 2) debt to EBITDA in excess of 3x, 3)
negative EBITDA for any twelve month period, or 3) an RBC ratio
below 150% of CAL.
WellCare Health Plans, Inc. is headquartered in Tampa, Florida. For
the first nine months of 2015, the company reported approximately
$10.4 billion in total revenue. As of Sept. 30, 2015 shareholders'
equity was $1.7 billion and total medical membership (excluding
Medicare Part D) was approximately 2.8 million members.
Moody's has assigned provisional debt ratings to securities that
may be issued under WellCare's shelf registration statement, with a
stable outlook:
WellCare Health Plans, Inc. - senior unsecured debt at (P)Ba2;
subordinated debt at (P)Ba3; preferred stock at (P)B1.
The principal methodology used in these ratings was U.S. Health
Insurance Companies published in October 2014.
WESTMORELAND COAL: Posts $46.5 Million Net Loss for Third Quarter
-----------------------------------------------------------------
Westmoreland Coal Company filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
applicable to common shareholders of $46.6 million on $350 million
of revenues for the three months ended Sept. 30, 2015, compared to
a net loss applicable to common shareholders of $49.3 million on
$338 million of revenues for the same period last year.
For the nine months ended Sept. 30, 2015, the Company reported a
net loss applicable to common shareholders of $94.9 million on
$1.07 billion of revenues compared to a net loss applicable to
common shareholders of $132 million on $806 million of revenues for
the same period during the prior year.
As of Sept. 30, 2015, the Company had $1.72 billion in total
assets, $2.21 billion in total liabilities and a $489 million total
deficit.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/QvXflm
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE
AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest
independent coal company in the United States. The Company's coal
operations include coal mining in the Powder River Basin in
Montana and lignite mining operations in Montana, North Dakota and
Texas. Its power operations include ownership of the two-unit
ROVA coal-fired power plant in North Carolina.
Westmoreland Coal Company reported a net loss applicable to common
shareholders of $173 million in 2014, a net loss applicable to
common shareholders of $6.05 million in 2013 and a net loss
applicable to common shareholders of $8.58 million in 2012.
* * *
As reported by the TCR on Nov. 20, 2014, Standard & Poor's Rating
Services raised its corporate credit rating on Westmoreland Coal
Co. one-notch to 'B' from 'B-'. "The stable outlook is supported
by Westmoreland's committed sales position over the next year,
which should result in stable cash flows," said Standard & Poor's
credit analyst Chiza Vitta.
Moody's upgraded the corporate family rating (CFR) of Westmoreland
Coal Company to 'B3' from 'Caa1', and assigned 'Caa1' rating to the
company's proposed new $300 million First Lien Term Loan, the TCR
reported on Nov. 20, 2014. The upgrade of the CFR reflects the
company's successful integration of the Canadian mines acquired in
April 2014, and Moody's expectation that the company's Debt/ EBITDA
will track at around 5x in 2015 and 2016 and that the company will
be break-even to modestly free cash flow positive over the same
time period.
YELLOWSTONE MOUNTAIN: Court Overturns $2.2-Mil. Judgment
--------------------------------------------------------
The Associated Press reported that the Montana Supreme Court has
overturned a $2.2 million award granted to a corporation that
bought a house at the exclusive Yellowstone Mountain Club but
didn't receive the ski-out access it was promised.
According to the report, Continental Partners bought land from
Yellowstone Development in 2004 and built two houses. WLW Realty
Partners purchased one that was under construction for $12 million,
the report related. Continental said Yellowstone Development
assured the house would have a ski-in and gravity ski-out access
before construction was complete, the report further related.
About Yellowstone Mountain Club
Located near Big Sky, Montana, Yellowstone Mountain Club LLC --
http://www.theyellowstoneclub.com/-- is a private golf and ski
community with more than 350 members, including Bill Gates and Dan
Quayle. The Company was founded in 1999.
Yellowstone Club and its affiliates filed for Chapter 11
bankruptcy (Bankr. D. Montana, Case No. 08-61570) on Nov. 10,
2008. The Company's owner affiliate, Edra D. Blixseth, filed
a separate Chapter 11 petition on March 27, 2009 (Case No.
09-60452).
Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green
PLLC represented Yellowstone. The Debtors hired FTI Consulting
Inc. and Ronald Greenspan as CRO. The official committee of
unsecured creditors were represented by Parsons, Behle and
Latimer; and James H. Cossitt, Esq., as counsel. Credit Suisse,
the prepetition first lien lender, was represented by Skadden,
Arps, Slate, Meagher & Flom.
In June 2009, the Bankruptcy Court entered an order confirming
Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor
Capital Partners LLC acquired equity ownership in the reorganized
Club for $115 million.
Marc S. Kirschner, Esq., was appointed the Trustee of the
Yellowstone Club Liquidating Trust created under the Plan.
[*] Fitch: US Coal Producers Restructuring for a Smaller Footprint
------------------------------------------------------------------
U.S. coal producers continue to restructure as challenges in the
sector mount, according to Fitch Ratings. The trailing 12-month
default rate for the industry was 27.7%, including Hidili Industry
International Development Ltd., Alpha Natural Resources, Inc.,
Winsway Enterprises Holdings Ltd., Patriot Coal Corporation, and
Walter Energy Inc.
The decline in U.S. steam coal consumption has been well
telegraphed by very low natural gas prices. Hopes for growth tied
to export markets have been dashed by growing excess supply and the
strengthening dollar. The prospect of further reduction in coal
burn to reduce carbon emissions is firmly on the table, and U.S.
coal producers are undergoing a painful right sizing.
When natural gas prices in the U.S. last saw levels under $3 per
million BTUs in 2012, nearly 70 million tons of U.S. production
found a home overseas. Currently, seaborne steam coal markets are
also rationalizing, given excess supply and lower import demand
from the largest steam coal market, China. Both China and India
have been reducing their demand for coal imports as they ramp up
domestic supply. Competition from key coal-producing regions of
Australia, South Africa, Colombia and Russia, where currencies have
become weaker, has displaced U.S. exports. Seaborne steam coal
market prices are off more than 50% from their peaks, and Fitch
expects further declines while production is curtailed and
inventories are sold. We also expect U.S. steam exports to fall
below 25 million tons per year from 37 million tons in 2014.
Fitch believes coal consumption for electric power will be
relatively flat in advance of the implementation of the Clean Power
Plan (CPP). We expect the shift from Central Appalachian Basin
(CAP) production toward Illinois Basin (IB) and Powder River Basin
(PRB) coal to continue, given cost advantages.
Thermal coal has been in a secular decline in the U.S. since 2005
and in the high-cost CAP since the late 1990s. Since the 1980s,
domestic coal has had periods of consolidation, and several CAP
coal producers filed for bankruptcy in the late 1990s through early
2000s. Lower for longer natural gas prices have cut domestic steam
coal demand by about 100 million tons in 2015 from about 848
million tons in 2014 and allowed the adoption of the EPA's Mercury
and Air Toxics Standards without consumer complaint.
Fitch expects U.S. metallurgical (met) coal exports to drop to
between 44 million and 55 million tons per year. Domestic
consumption of met coal is about 22 million tons per year.
The flooding in Queensland, Australia beginning in December 2010
resulted in a supply squeeze and, coupled with strong demand from
China, very high met coal prices. Coal producers made acquisitions
in 2011, seeking more exposure to met coal.
At the same time, new projects were being funded in Mozambique,
Mongolia and Australia. The seaborne met market has been
oversupplied by roughly 10% since late 2012, despite prices falling
48% since that time as Australia's additions have outweighed cuts
and demand has failed to grow. Global steel production was down
nearly 2.4% for the year as of Sept. 30, 2015, compared with the
same period in 2014. Steel consumption in China looks to be down
nearly 6% over the same period.
[*] Kaufman, Owsley Completes Distressed Investment Banking Book
----------------------------------------------------------------
Peter Kaufman and Henry Owsley, President and CEO, respectively of
New York based investment bank Gordian Group have completed the
second edition of their definitive book, Distressed Investment
Banking: To the Abyss and Back (Beard Books).
This classic book is an authoritative source about the
restructuring of troubled companies. It provides an insider's view
on the methods and complexities of this highly specialized area of
investment banking. Messrs. Owsley and Kaufman are widely
acknowledged leaders in this field and are the senior partners at
Gordian Group, a top-tier boutique investment banking firm
headquartered in
New York.
Distressed Investment Banking: To the Abyss & Back – 2nd Edition
is available for purchase at Beard Books:
https://ecommerce.beard.com/beardbooks/distressed_investment_banking_second_edition.html
or (888) 563-4573 or on Amazon.
The just released 2nd Edition provides new insights and updates
primarily related to Option Valuation and Game Theory. According
to co-author Henry Owsley, "In this new edition, we use Option
Valuation to tackle the dilemma of whether it makes sense to
repurchase debt; we think some readers may find it surprising that
such a repurchase program actually disadvantages old equity.
Through the application of Game Theory, we also provide a lens into
how disputes with junior constituencies (valuation fights for
example) should settle, and to predict when they may not be
resolved consensually."
Peter Kaufman adds, "Henry and I, and our firm, have worked hard to
develop an investment banking practice that provides unconflicted
and creative advice to boards of directors on how to resolve
financial and capital structure challenges to the benefit of old
equity. Since the original publication of this book, we have honed
our game and our tool-kit, and we are excited to publish this
update to the classic book in our field."
About Gordian Group
Founded in 1988, Gordian Group -- http://www.gordiangroup.com-- is
an investment bank providing advisory services with respect to
financial restructurings, complex, "story" and/or distressed M&A
and capital raises, both in and out of bankruptcy, as well as
structured finance remediation, opinions and expert witness and
litigation support services.
Gordian Group is continually recognized as a national leader in
solving complex issues and has completed over 275 engagements on
behalf of companies, boards of directors, and shareholders
(including entrepreneurs and private equity firms), as well as a
decades long history advising banking and insurance institutions
and regulators, state governments and federal agencies.
Peter Kaufman and Henry Owsley are co-authors of the definitive
works in the field, Distressed Investment Banking: To the Abyss and
Back (1st & 2nd edition), (Beard Books, 2005 & 2015), and Equity
Holders Under Siege: Strategies and Tactics for Distressed
Businesses, (Beard Books, 2014); all books are "must-read" for
boards of directors, management teams and shareholders and/or
owners of financially stressed situations, as well as for buyers
and professionals.
[*] October Bankruptcy Filings Increased 11% Over Previous Month
----------------------------------------------------------------
Cornerstone Credit Union League reported that total U.S. bankruptcy
filings for the month of October increased 11% compared to
September, according to the American Bankruptcy Institute.
October bankruptcy filings totaled 89,875, up from the 80,668
filings registered in September 2013. The 86,331 total
noncommercial filings for October represented a 12% increase from
the September noncommercial filing total of 77,274. Total
commercial filings for October 2013 were 3,544, representing a 4%
increase from the 3,394 filings in September.
The 89,875 total bankruptcy filings in October represented an 11%
decrease from the 101,399 filings registered in October 2012.
The average nationwide per capita bankruptcy-filing rate through
the first 10 calendar months of 2013 (Jan. 1-Oct. 31) was 3.45
(total filings per 1,000 per population). Average total filings
per day in October 2013 were 2,899, an 11% decrease from the 3,271
total daily filings in October 2012.
*********
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 ***