/raid1/www/Hosts/bankrupt/TCR_Public/160203.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, February 3, 2016, Vol. 20, No. 34
Headlines
AAMES MORTGAGE 2001-1: Moody's Hikes Cl. M-2 Debt Rating to Caa1
ACELITY LP: Moody's Assigns Ba3 Rating on $400MM 1st-Lien Notes
ALERE INC: Moody's Puts B2 CFR Under Review for Upgrade
ALTEGRITY INC: Bankr. Court Won't Adjudicate Income Tax Liability
AMERICAN APPAREL: Court Confirms First Amended Ch. 11 Plan
AMERICAN APPAREL: Court OKs Sale of OAK NYC Apparel Inventory
AMERICAN APPAREL: Exclusive Solicitation Period Extended to July 1
AMERICAN EAGLE: Sale of Assets to Resource Energy Consummated
AMERICAN NATURAL: Creditors Have Until Feb. 15 to File Claims
ARCHDIOCESE OF ST. PAUL: Has Court Authority to Sell Hayden Center
ATI ENTERPRISES: Accuses Williams & Connolly of Overbilling
ATLANTIC CITY, NJ: Gov. Christie Joins in Prevention of Bankruptcy
ATLANTIC CITY, NJ: Moody's Releases Corrected Press Release
BAILEY SHELTER: Voluntary Chapter 11 Case Summary
BAILEY TOOL: Voluntary Chapter 11 Case Summary
BERNARD L. MADOFF: Court Affirms Use of Inter-Account Method
BEST PAYPHONES: Court Junks Bid to Review Jurisdiction Ruling
BIONITROGEN HOLDINGS: Compensation Package for CEO Approved
BOOMERANG SYSTEMS: Can Hire Graham Curtin as Special Patent Counsel
BOOMERANG SYSTEMS: Hogan McDaniel Okayed as Delaware Counsel
BOOMERANG TUBE: Resolves Meta-Fee Concern in Chapter 11 Plan
C4 PERFORMANCE: Case Summary & 20 Largest Unsecured Creditors
CAFARELLI METALS: Voluntary Chapter 11 Case Summary
CCNG ENERGY: Amends List of Largest Unsecured Creditors
CHRYSLER LLC: Blasts Sanctions Bid in Dealer Agreement Row
CIVITAS SOLUTIONS: S&P Assigns 'B+' CCR, Outlook Positive
DISTRICT OF MCALLEN: Can Hire Adolfo Campero as Counsel
ENERGY FUTURE: $300M Texas Mines Settlement with Alcoa Approved
FIRST HORIZON: Fitch Affirms 'B' Preferred Stock Rating
FIRST NATIONAL OF NEBRASKA: Fitch Affirms 'BB+' Sub. Debt Rating
GABRIEL ENTERPRISES: Case Summary & 2 Top Unsecured Creditors
GARLOCK SEALING: John Crane Intervening in Racketeering Suits
GEOFFREY EDELSTEN: Fla. Judge Axes Malpractice Row Lead by Trustee
GFD CONSTRUCTION: Case Summary & 3 Largest Unsecured Creditors
GLENVILLE STATE: Moody's Lowers Rating on 2011A Bonds to B1
HANCOCK FABRICS: Case Summary & 30 Largest Unsecured Creditors
HANCOCK FABRICS: Files Voluntary Chapter 11 Bankruptcy Petition
HARRISON FAMILY: Case Summary & 3 Largest Unsecured Creditors
HEALTH DIAGNOSTIC: Stay Lifted to Allow Bank to Repossess
HORSEHEAD HOLDING: Case Summary & 50 Largest Unsecured Creditors
HORSEHEAD HOLDING: Files Voluntary Chapter 11 Bankruptcy Petition
HUDBAY MINERALS: S&P Lowers CCR to 'B-', Outlook Negative
HUNT HINGES: Voluntary Chapter 11 Case Summary
KINETIC CONCEPTS: S&P Assigns BB- Rating on $400MM 1st-Lien Notes
LANDS' END: S&P Lowers CCR to 'B', Outlook Stable
MACCO PROPERTIES: Bankr. Court Recommends Denial of Jury Trial Bid
MACCO PROPERTIES: Court Denies Bid to Junk Suit vs. Superior Farm
MOLYCORP INC: Oaktree Rips Paul Hastings' $1M Bill in Probe
MT MOORE: Court Confirms Ch. 11 Plan
NEW GULF RESOURCES: Feb. 22 Set as General Claims Bar Date
NEW GULF: Seeks Approval of Restructuring Support Agreement
NUO THERAPEUTICS: Feb. 5 Meeting Set to Form Creditors' Panel
ONE SOURCE INDUSTRIAL: Trustee Taps F&P to Assist in Liquidation
ORCAL GEOTHERMAL: Fitch Affirms 'BB' Rating on $165MM Sr. Notes
PBG PROPERTIES: Case Summary & 3 Largest Unsecured Creditors
PEDRO LOPEZ MUNOZ: Court Rejects Bid for Ch. 11 Trustee Appointment
QUICKSILVER RESOURCES: Picks $245M BlueStone Bid for Oil Assets
QUICKSILVER RESOURCES: To Close BlueStone Sale by March 31
QUIKSILVER INC: Court Confirms Third Amended Ch. 11 Plan
RCS CAPITAL: Hires Prime Clerk as Claims and Noticing Agent
RCS CAPITAL: Moody's Lowers Corporate Family Rating to 'Ca'
RCS CAPITAL: Seeks Joint Administration of Cases
REICHHOLD HOLDINGS: Chikamauga, Ferndale Properties Sale Okayed
RELATIVITY MEDIA: Bankruptcy Court Approves Plan of Reorganization
RELATIVITY MEDIA: Ends Manchester Dispute Ahead of Ch. 11 Hearing
RYAN LLC: Moody's Affirms B3 CFR & Lowers Outlook to Negative
RYCKMAN CREEK: Case Summary & 30 Largest Unsecured Creditors
SA CAMINO BANDERA: Case Summary & 4 Largest Unsecured Creditors
SABINE OIL: Files Chapter 11 Plan to Restructure $2.9-Bil. Debt
SAGE PRODUCTS: Moody's Puts B2 CFR Under Review for Upgrade
SAGE PRODUCTS: S&P Puts 'B' CCR on CreditWatch Positive
SAMSON RESOURCES: Has Access to Cash Collateral Until Feb. 29
SAMSON RESOURCES: Proposes Incentive & Severance Programs
SAMSON RESOURCES: Proposes Performance Award Program
SAMSON RESOURCES: Seeks to Sell Certain Oil and Gas Assets
SANDRIDGE ENERGY: In Talks with Banks on Restructuring Options
SANTA FE GOLD: Cancels Chapter 11 Auction, Names Waterton Buyer
SANTA FE GOLD: Needs Until March 23 to File Ch. 11 Plan
SCHWAB INDUSTRIES: Ch. 11 Trustee's Claims Barred by Res Judicata
SEARS METHODIST: Court Orders Dismissal of CSL's Bankruptcy Case
SFX ENTERTAINMENT: Files for Chapter 11 Bankruptcy Protection
SHREE MELDIKRUPA: Court Grants Use of Cash Collateral
SIGA TECHNOLOGIES: Prescott Group Has 3.8% Stake as of Jan. 29
SOUTHEAST POWERGEN: Moody's Cuts Rating on $545.5MM Debt to Ba3
SUSAN MARIA RABORN: Court Denies Bid to Stay Suit Over Stock Sale
SUTTON LUMBER: Case Summary & 19 Largest Unsecured Creditors
SWIFT ENERGY: Kirkland and Klehr Harrison File Verified Statement
SWIFT ENERGY: U.S. Needs to Know If Sale Includes Federal Assets
TATUADO HOSPITALITY: Case Summary & 18 Largest Unsecured Creditors
TERRESTAR CORP: Court Refuses to Review Dismissal of "Perez" Suit
THELEN LLP: Gets Approval of $4M Settlement Over Terminations
TORQUED UP: Can Continue IPFS Insurance Premium Financing Deal
TORQUED UP: Can Pay Severance for Retained Employees
TORQUED-UP ENERGY: Taps Gollob as Certified Public Accountant
TRI STATE TRUCKING: First Citizens Asks Court to Lift Stay
TRIGEANT HOLDINGS: BTB Refining's Suit vs. Gravity Midstream Junked
TRUMP ENTERTAINMENT: 3rd Cir. Affirms Order Rejecting Union's CBA
TTJ ENTERPRISES: Voluntary Chapter 11 Case Summary
TWIN RIVER: S&P Raises Rating on $520MM Facility to 'BB'
ULTRA PETROLEUM: S&P Lowers CCR to 'CCC-', Outlook Negative
US STEEL CANADA: Commences Sale & Investment Solicitation Process
UTSA APARTMENTS 5: Case Summary & Largest Unsecured Creditor
UTSA APARTMENTS 6: Case Summary & Largest Unsecured Creditor
VERSO CORP: Feb. 5 Meeting Set to Form Creditors' Panel
VOGUE BEAUTY STUDIO: Court Denies Bid to Employ Counsel
WARREN RESOURCES: S&P Lowers Corporate Credit Rating to 'D'
WATERSCAPE RESORT: Court Grants Pavarini's Summary Judgment Bid
WAVE SYSTEMS: Files for Chapter 7 Protection; Executives Resign
WOW ORTHODONTICS: Voluntary Chapter 11 Case Summary
XINERGY LTD: Court Approves Sale of True Energy Assets to A & G
[*] Feds Say SEC Suit Should Wait for Shkreli's Criminal Case
[*] JPMorgan to Pay Ambac $995M to Settle RMBS-Related Claims
[*] Proskauer Named Among Blaw360's Bankruptcy Group of the Year
[*] Skadden Arps Among Blaw360's Bankruptcy Group of the Year
[*] Suspended Fla. Atty Charged With Stealing as Chapter 7 Trustee
[*] U.S. Suspects Wyoming Officials Lax on Cleanup Insurance
[*] Weil Gotshal Bags Law360 Bankr. Group for the 6th Straight Year
[] US Corporate Defaults to Hit Six-Year High in 2016, Moody's Say
*********
AAMES MORTGAGE 2001-1: Moody's Hikes Cl. M-2 Debt Rating to Caa1
----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of 13 tranches
from 5 deals issued by various issuers, backed by Subprime mortgage
loans.
Complete rating actions are as follows:
Issuer: Aames Mortgage Trust 2001-1
Cl. M-2, Upgraded to Caa1 (sf); previously on Jul 27, 2012
Downgraded to Caa2 (sf)
Issuer: Citigroup Mortgage Loan Trust 2006-WFHE1
Cl. A-1D, Upgraded to Aa2 (sf); previously on Aug 26, 2013 Upgraded
to A1 (sf)
Cl. M-4, Upgraded to Ba3 (sf); previously on Feb 5, 2015 Upgraded
to Caa1 (sf)
Cl. M-5, Upgraded to Ca (sf); previously on Apr 6, 2010 Downgraded
to C (sf)
Issuer: CWABS Asset-Backed Certificates Trust 2006-2
Cl. 1-A-1, Upgraded to A3 (sf); previously on Feb 3, 2015 Upgraded
to Ba3 (sf)
Cl. 2-A-2, Upgraded to B1 (sf); previously on Jun 10, 2014 Upgraded
to B3 (sf)
Cl. 2-A-3, Upgraded to B2 (sf); previously on Jun 10, 2014 Upgraded
to Caa2 (sf)
Cl. 2-A-4, Upgraded to B1 (sf); previously on Jun 10, 2014 Upgraded
to Caa1 (sf)
Issuer: Equity One Mortgage Pass-Through Trust 2003-2
AV-1, Upgraded to Aa2 (sf); previously on May 3, 2012 Downgraded to
A1 (sf)
M-1, Upgraded to Ba1 (sf); previously on May 3, 2012 Downgraded to
Ba3 (sf)
M-2, Upgraded to B1 (sf); previously on Mar 3, 2014 Upgraded to
Caa1 (sf)
M-3, Upgraded to Caa3 (sf); previously on Mar 7, 2011 Downgraded to
C (sf)
Issuer: Saxon Asset Securities Trust 2002-2
Cl. M-1, Upgraded to B1 (sf); previously on May 4, 2012 Downgraded
to Caa1 (sf)
RATINGS RATIONALE
The upgrades are a result of improving performance of the related
pools and/or build-up in credit enhancement of the tranches. The
actions reflect the recent performance of the underlying pools and
Moody's updated loss expectations on the pools.
Factors that would lead to an upgrade or downgrade of the rating:
Ratings in the US RMBS sector remain exposed to the high level of
macroeconomic uncertainty, and in particular the unemployment rate.
The unemployment rate fell to 5.0% in December 2015 from 5.6% in
December 2014. Moody's forecasts an unemployment central range of
4.5% to 5.5% for the 2016 year. Deviations from this central
scenario could lead to rating actions in the sector. House prices
are another key driver of US RMBS performance. Moody's expects
house prices to continue to rise in 2016. Lower increases than
Moody's expects or decreases could lead to negative rating actions.
Finally, performance of RMBS continues to remain highly dependent
on servicer procedures.
Any change resulting from servicing transfers or other policy or
regulatory change can impact the performance of these transaction.
ACELITY LP: Moody's Assigns Ba3 Rating on $400MM 1st-Lien Notes
---------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Acelity L.P.
Inc.'s proposed $400 million first lien senior secured notes
offering. Proceeds will be used to refinance the $312 million
outstanding under the company's term loan E-2, pay fees and
expenses and boost cash balances. Moody's will reassess Acelity's
Speculative Grade Liquidity Rating of SGL-4 upon closing of the
transaction. The rating outlook remains stable. All other ratings
are unaffected.
Assignments:
Issuer: Acelity L.P. Inc.
Senior Secured Regular Bond/Debenture at Ba3 (LGD 2)
RATINGS RATIONALE
The B3 Corporate Family Rating reflects Acelity's very high
financial leverage, limited free cash flow and modest interest
coverage. Moody's does not expect a meaningful reduction in
leverage in the near-term as the company is facing challenges in
its core negative pressure wound therapy franchise and is still
required to make significant cash outlays related to litigation
settlements. The ratings also reflect Acelity's considerable scale
and the strong market presence of its Vacuum Assisted Closure
(V.A.C.) products. The ratings are also supported by the company's
healthy margins and the expectation that growth in newer product
offerings will help offset headwinds in the V.A.C. business.
The stable outlook reflects Moody's expectation that Acelity will
be able to maintain earnings levels despite headwinds from
reimbursement issues and competitive pressures.
Moody's could upgrade Acelity's ratings if liquidity improves and
leverage is meaningfully reduced. Specifically, debt to EBITDA
would need to approach 6.0 times before Moody's would consider an
upgrade.
Moody's could downgrade the ratings if competitive or
pricing/reimbursement pressures result in material top-line
deterioration or margin contraction. The ratings could also be
downgraded if liquidity weakens.
The principal methodology used in this rating was Global Medical
Product and Device Industry published in October 2012.
Headquartered in San Antonio, Texas, Acelity is a global medical
technology company with leadership positions in advanced wound care
and regenerative medicine. Acelity reported revenues of
approximately $1.9 billion for the twelve months ended Dec. 31,
2015. Acelity is owned by a private equity consortium, including
Apax Partners and affiliates of the Canada Pension Plan Investment
Board and Public Sector Pension Investment Board.
ALERE INC: Moody's Puts B2 CFR Under Review for Upgrade
-------------------------------------------------------
Moody's Investors Service placed the ratings of Alere, Inc. under
review for upgrade, including the company's B2 Corporate Family
Rating and B2-PD Probability of Default Rating. Instrument ratings
placed under review for upgrade include those for the Ba3 senior
secured first lien credit facilities, B3 senior unsecured notes,
and Caa1 senior subordinated notes. Moody's concurrently affirmed
Alere's speculative grade liquidity rating of SGL-1. This action
follows the announcement that Alere has entered into a definitive
agreement to be acquired by Abbott Laboratories. The transaction
is valued at approximately $8.4 billion to be funded with 5.8
billion in cash and the assumption of about $2.6 billion in net
debt.
At this time, it is Moody's understanding that Alere's debt will
either be assumed or refinanced by Abbott. The review for upgrade
reflects Moody's assumption that Abbott's credit profile will
remain materially stronger than Alere's standalone profile, post
transaction. Should Alere's outstanding debt be retired, Moody's
will withdraw all of Alere's ratings. Moody's understands that the
transaction is expected to close in the second half of 2016,
subject to regulatory review and customary closing conditions.
These ratings were placed under review for upgrade:
Alere, Inc.:
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
Senior secured bank credit facilities at Ba3 (LGD 2)
Senior unsecured notes at B3 (LGD 4)
Senior subordinated notes at Caa1 (LGD 5)
Rating affirmed:
The Speculative Grade Liquidity Rating of SGL-1 has been
affirmed.
RATINGS RATIONALE
Excluding the possible acquisition by Abbott, Alere's current B2
Corporate Family Rating reflects the company's high financial
leverage, ongoing reimbursement pressures on healthcare providers,
and technological risk inherent in the highly competitive medical
diagnostics industry. The company has faced operating challenges
within the U.S. market, including product recalls and reimbursement
headwinds for its mail-order diabetes tests. However, the ratings
are supported by the company's strong competitive position within
the point-of-care diagnostic testing market. In addition, the
ratings are supported by the company's diverse product offering,
and track record of technological innovation, which positions it
well to serve hospitals and other healthcare providers. The
affirmation of the Speculative Grade Liquidity Rating reflects
Moody's expectation that the company will maintain a very good
liquidity profile, including good availability under the company's
revolving credit facility and good headroom under financial
covenants.
The principal methodology used in these ratings was that for the
Global Medical Product and Device Industry published in October
2012.
Alere, Inc., headquartered in Waltham, Massachusetts, is a
manufacturer of rapid diagnostic tests, operating in professional
and consumer diagnostics. Alere's professional diagnostic products
focus primarily within the infectious disease, cardio-metabolic
disease, and toxicology segments. The company's consumer
diagnostics segment, as part of a 50/50 joint venture with Procter
& Gamble, focuses primarily on the over-the-counter pregnancy and
fertility/ovulation testing markets. For the twelve months ended
Sept. 30, 2015, the company generated net revenues from continuing
operations of approximately $2.5 billion.
ALTEGRITY INC: Bankr. Court Won't Adjudicate Income Tax Liability
-----------------------------------------------------------------
The Official Information Company and HireRight Solutions, Inc.,
collectively the Debtors, ask the United States Bankruptcy Court
for the District of Delawareto adjudicate the corporate income tax
liability, if any, owed by them to the State of Oklahoma for the
fiscal year ending September 30, 2011, even though they have a tax
protest proceeding pending before the Oklahoma Tax Commission.
The Debtors assert that the Court can determine the tax liability
in a streamlined manner not available in the Oklahoma system
because the Court can determine the constitutionality of the
relevant tax statute as an initial matter while the Oklahoma Tax
Commission cannot.
In a Memorandum Opinion dated January 14, 2016, which is available
at http://is.gd/JpPZeefrom Leagle.com, U.S. Bankruptcy Judge
Laurie Selber Silverstein denied the Motion and abstained from
determining the Debtors' tax liability. In making the request, the
Debtors ignore well-established law that a court, including the
Bankruptcy Court, should not rule on constitutional issues unless
such adjudication is unavoidable, Judge Silverstein held.
The case is In re: ALTEGRITY, INC., et al., Chapter 11, Debtors.,
Case No. 15-10226 (LSS)(Bankr. D. Del.).
About Altegrity Inc.
Altegrity Inc. provides background investigations for the U.S.
government; employment background and mortgage screening for
commercial customers; technology-driven legal services and
software
for data management; and investigative, analytic, consulting, due
diligence, and security services. Altegrity is principally owned
by investment funds affiliated with Providence Equity Partners.
Altegrity Inc. and 37 of its affiliates filed Chapter 11
Bankruptcy
petitions (Bankr. D. Del. Lease Case No. 15-10226) on Feb. 8,
2015.
Jeffrey S. Campbell signed the petitions as president and chief
financial officer. The Debtors disclosed total assets of $1.7
billion and total liabilities of $2.1 billion as of June 30, 2014.
M. Natasha Labovitz, Esq., Jasmine Ball, Esq., and Craig A.
Bruens,
Esq., at Debevoise & Plimpton LLP serve as the Debtors' counsel.
Joseph M. Barry, Esq., Ryan M. Bartley, Esq., and Edmon L. Morton,
Esq., at Young, Conaway, Stargatt & Taylor, LLP, act as the
Debtors' Delaware and conflicts counsel. Stephen Goldstein and
Lloyd Sprung, at Evercore Group, LLC, are the Debtors' investment
bankers. Kevin M. McShea and Carrianne J. M. Basler, at
Alixpartners LLP serve as the Debtors' restructuring advisors.
Prime Clerk LLC is the Debtors' claims and noticing agent.
PricewaterhouseCoopers LLP serves as the Debtors' independent
auditors.
The Bankruptcy Court has scheduled for May 5, 2015, the hearing to
consider the approval of the disclosure statement explaining the
Debtor's plan, which proposes to liquidate the US Investigations
Services. Land Line relates that USIS lost key federal background
check contracts.
The U.S. Trustee for Region 3 appointed six creditors to serve on
the official committee of unsecured creditors. The Creditors'
Committee retained Wilmer Cutler Pickering Hale & Dorr LLP, as
lead
counsel, and Bayard, P.A., as Delaware co-counsel.
* * *
Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for
the District of Delaware on May 15, 2015, approved the disclosure
statement explaining Altegrity, Inc., et al.'s Joint Chapter 11
Plan. A hearing to confirm the Plan was scheduled for July 1,
2015.
As reported in the April 1, 2015 edition of the Troubled Company
Reporter, the Debtors filed a Joint Chapter 11 Plan and
accompanying disclosure statement that will delever the Company by
approximately $700 million, or 40% of the Debtors' outstanding
debt.
The Plan provides for a 2.2% estimated recovery of allowed general
unsecured claims, which total approximately $82,510,532. Holders
of Secured Third Lien Notes Claims are poised to recover 7.7% of
their estimated $66,304,133 total amount of claims. Holders of
Secured Second Lien Notes Claims are poised to recover 48.4% of
their estimated $519,265,011 total amount of claims.
A full-text copy of the Disclosure Statement dated May 16, 2015,
is
available at http://bankrupt.com/misc/ALTEGRITYds0516.pdf
Judge Silverstein on Aug. 14, 2015, issued findings of fact,
conclusions of law, and order confirming Altegrity, Inc., et al.'s
Joint Plan of Reorganization.
AMERICAN APPAREL: Court Confirms First Amended Ch. 11 Plan
----------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware on Jan. 27, 2016, issued a findings of fact,
conclusions of law and order confirming American Apparel, Inc., et
al.'s First Amended Joint Plan of Reorganization.
The Official Committee of Unsecured Creditors, the Internal Revenue
Service, Travis County, the Texas Comptroller of Public Accounts,
the U.S. Trustee, Dov Charney, Hudson Pacific Properties, Inc., and
Lt. Col. Matthew Lewin, filed objections to the confirmation of the
Plan. Judge Shannon sustained the U.S. Trustee objection and
overruled all other objections to the Plan.
Following negotiations with the Committee of Lead Lenders and the
Creditors' Committee, the Debtors reached terms of a fully
consensual plan. The Plan, as amended, now contemplates:
* An increase in GUC Support Payment. The Committee of Lead
Lenders agreed to fund a 150% increase in the GUC Support Payment
to $2.5 million, and Holders of Prepetition Notes will not receive
any cash distributions on account of their $143 million deficiency
claims;
* An increase in Litigation Trust Funding: The Committee of Lead
Lenders agreed to double funding available to the Litigation Trust,
from $250,000 to $500,000, and further agreed to permit 75% of the
first $2.5 million in proceeds that the Litigation Trust generates
to be distributed to Holders of General Unsecured Claims other than
the holders of the noteholders' deficiency claim;
* An increase in Committed Exit Financing: The Plan now provides
that as of the Effective Date the Debtors will have $80 million of
exit capital; and
* The allowance of PIK Interest: The Committee of Lead Lenders
has agreed to relax the terms of the credit agreement governing the
New Exit Term Loan to permit the Debtors to elect to PIK Interest
instead of in cash interest payments in the event that the Debtors'
total cash falls below certain thresholds.
About American Apparel
American Apparel, Inc., American Apparel (USA), LLC, American
Apparel Retail, Inc., American Apparel Dyeing & Finishing, Inc.,
KCL Knitting, LLC and Fresh Air Freight, Inc. sought Chapter 11
bankruptcy protection (Bankr. D. Del. Proposed Lead Case No.
15-12055) on Oct. 5, 2015. The petition was signed by Hassan
Natha as chief financial officer.
The Debtors reported total assets of $199,360,934 and total
liabilities of $397,576,744.
The Debtors and their non-debtor affiliates operate a vertically
integrated manufacturing, distribution, and retail business
focused on branded fashion-basic apparel, employing approximately
8,500 employees across six manufacturing facilities and
approximately 230 retail stores in the United States and 17 other
countries worldwide.
The Debtors have engaged Jones Day as restructuring counsel,
Pachulski Stang Ziehl & Jones LLP as local counsel, Moelis &
Company as investment banker, FTI Consulting, Inc. as financial
advisor, DJM Real Estate as real estate consultant and Garden City
Group, LLC as claims and noticing agent.
* * *
The Debtors filed a proposed Joint Plan of Reorganization that
contemplates converting more than $200 million of senior notes
into equity interests of the reorganized American Apparel.
On Nov. 20, 2015, the Court approved the Disclosure Statement and
set a Jan. 7, 2016 voting deadline and a Jan. 20 plan confirmation
hearing.
On Jan. 10, the Debtors received a letter from former CEO Dov
Charney disclosing a proposed $300 million alternative transaction
that will be funded by Hagan Capital Group and Silver Creek
Capital Partners but American Apparel rejected the proposal.
On Jan. 25, 2016, the Court held a telephonic hearing, granting
confirmation of the Debtors' First Amended Plan, provided certain
revisions were made to the First Amended Plan and the proposed
confirmation order.
AMERICAN APPAREL: Court OKs Sale of OAK NYC Apparel Inventory
-------------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware authorized the sale of debtors American
Apparel, Inc., et al.'s OAK NYC apparel inventory, free and clear
of all liens, claims and encumbrances to Canary New York, Inc.,
pursuant to a going-out-of-business format.
Joseph M. Mulvihill, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware, told the Court that during the sale hearing,
the Debtors and Canary engaged in negotiations over the disposition
of the OAK Assets and ultimately agreed to the terms of sale.
The Asset Purchase Agreement, which reflects the negotiated
agreement between the Debtors and Canary, contains the following
relevant terms, among others:
(a) Acquired Assets: consists of:
(i) all of the existing inventory of the business operations
commonly known and referred to as “Oak NYC” and an online store
located at www.oaknyc.com (“Business”);
(ii) all interests of the Seller in and to the Business
Intellectual Property;
(iii) all Permits that relate exclusively to the Business; and
(iv) all goodwill associated with the foregoing assets.
(b) Assumed Liabilities: Effective as of the Closing Date,
Purchaser shall assume and pay, fully satisfy, discharge and
perform all Liabilities arising from or relating to ownership or
use of the Acquired Assets or otherwise relating to the Business.
(c) Purchase Price: The aggregate consideration for the Acquired
Assets shall be the Assumed Liabilities plus the aggregate cash
payment for the Inventory calculated as follows:(i)50% multiplied
by the book value of the Inventory up to an aggregate book value of
$1.2 million("Initial Inventory Threshold") and (ii)in the event
the book value of the Inventory exceeds the Initial Inventory
Threshold, 30% of the book value of the Inventory in excess of the
Initial Inventory Threshold.
(d) Purchaser Deposit: The Purchaser will deposit with the
Seller, by wire transfer of immediately available funds, the sum of
$300,000, which will be held by FTI Consulting, Inc., until
released in accordance with the provisions of the Asset Purchase
Agreement and the Sale Order.
Judge Shannon held that there was sufficient basis requiring the
sale of the OAK Assets and that the approval of the Debtors' Store
Closing Motion, the OAK APA, and the consummation of the
transaction contemplated in his Order is in the best interests of
the Debtors, their creditors and their estates.
American Apparel is represented by:
Laura Davis Jones, Esq.
James E. O'Neill, Esq.
Joseph M. Mulvihill, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
919 Market Street, 17th Floor
P.O. Box 8705
Wilmington, DE 19899-8705
Telephone: (302)652-4100
Facsimile: (302)652-4400
E-mail: ljones@pszjlaw.com
joneill@pszjlaw.com
jmulvihill@pszjlaw.com
- and -
Richard L. Wynne, Esq.
Erin N. Brady, Esq.
JONES DAY
555 South Flower Street, 50th Floor
Los Angeles, CA 90071
Telephone: (213)489-3939
Facsimile: (213)243-2539
E-mail: rlwynne@jonesday.com
enbrady@jonesday.com
- and -
Scott J. Greenberg, Esq.
Michael J. Cohen, Esq.
JONES DAY
222 East 41st Street
New York, NY 10017
Telephone: (212)326-3939
Facsimile: (212)755-7306
E-mail: sgreenberg@jonesday.com
mcohen@jonesday.com
About American Apparel
American Apparel, Inc., American Apparel (USA), LLC, American
Apparel Retail, Inc., American Apparel Dyeing & Finishing, Inc.,
KCL Knitting, LLC and Fresh Air Freight, Inc. sought Chapter 11
bankruptcy protection (Bankr. D. Del. Proposed Lead Case No.
15-12055) on Oct. 5, 2015. The petition was signed by Hassan
Natha as chief financial officer.
The Debtors reported total assets of $199,360,934 and total
liabilities of $397,576,744.
The Debtors and their non-debtor affiliates operate a vertically
integrated manufacturing, distribution, and retail business
focused on branded fashion-basic apparel, employing approximately
8,500 employees across six manufacturing facilities and
approximately 230 retail stores in the United States and 17 other
countries worldwide.
The Debtors have engaged Jones Day as restructuring counsel,
Pachulski Stang Ziehl & Jones LLP as local counsel, Moelis &
Company as investment banker, FTI Consulting, Inc. as financial
advisor, DJM Real Estate as real estate consultant and Garden City
Group, LLC as claims and noticing agent.
* * *
The Debtors filed a proposed Joint Plan of Reorganization that
contemplates converting more than $200 million of senior notes into
equity interests of the reorganized American Apparel.
On Nov. 20, 2015, the Court approved the Disclosure Statement and
set a Jan. 7, 2016 voting deadline and a Jan. 20 plan confirmation
hearing.
On Jan. 10, the Debtors received a letter from former CEO Dov
Charney disclosing a proposed $300 million alternative transaction
that will be funded by Hagan Capital Group and Silver Creek
Capital Partners but American Apparel rejected the proposal.
On Jan. 25, 2016, the Court held a telephonic hearing, granting
confirmation of the Debtors' First Amended Plan, provided certain
revisions were made to the First Amended Plan and the proposed
confirmation order.
AMERICAN APPAREL: Exclusive Solicitation Period Extended to July 1
------------------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware, at the behest of American Apparel, Inc., et
al., extended the exclusive plan filing period through and
including May 2, 2016, and the exclusive solicitation period
through and including July 1, 2016.
Judge Shannon overruled the objection of Dov Charney to the motion
for extension of exclusivity and cross motion to terminate
exclusivity.
In support of their extension request, the Debtors told the Court
that they are seeking extension of the exclusive periods in an
abundanction of caution in the event they do not exit from Chapter
11 by Feb. 2.
Judge Shannon, on Jan. 27, confirmed the Debtors' Chapter 11 Plan.
About American Apparel
American Apparel, Inc., American Apparel (USA), LLC, American
Apparel Retail, Inc., American Apparel Dyeing & Finishing, Inc.,
KCL Knitting, LLC and Fresh Air Freight, Inc. sought Chapter 11
bankruptcy protection (Bankr. D. Del. Proposed Lead Case No.
15-12055) on Oct. 5, 2015. The petition was signed by Hassan
Natha as chief financial officer.
The Debtors reported total assets of $199,360,934 and total
liabilities of $397,576,744.
The Debtors and their non-debtor affiliates operate a vertically
integrated manufacturing, distribution, and retail business
focused on branded fashion-basic apparel, employing approximately
8,500 employees across six manufacturing facilities and
approximately 230 retail stores in the United States and 17 other
countries worldwide.
The Debtors have engaged Jones Day as restructuring counsel,
Pachulski Stang Ziehl & Jones LLP as local counsel, Moelis &
Company as investment banker, FTI Consulting, Inc. as financial
advisor, DJM Real Estate as real estate consultant and Garden City
Group, LLC as claims and noticing agent.
* * *
The Debtors filed a proposed Joint Plan of Reorganization that
contemplates converting more than $200 million of senior notes
into
equity interests of the reorganized American Apparel.
On Nov. 20, 2015, the Court approved the Disclosure Statement and
set a Jan. 7, 2016 voting deadline and a Jan. 20 plan confirmation
hearing.
On Jan. 10, the Debtors received a letter from former CEO Dov
Charney disclosing a proposed $300 million alternative transaction
that will be funded by Hagan Capital Group and Silver Creek
Capital Partners but American Apparel rejected the proposal.
On Jan. 25, 2016, the Court held a telephonic hearing, granting
confirmation of the Debtors' First Amended Plan, provided certain
revisions were made to the First Amended Plan and the proposed
confirmation order.
AMERICAN EAGLE: Sale of Assets to Resource Energy Consummated
-------------------------------------------------------------
American Eagle Energy Corporation has filed a notice with the
Bankruptcy Court that the sale of its assets in accordance with the
terms of the purchase agreement with Resource Energy Can-Am LLC has
been consummated.
The Colorado Bankruptcy Court previously entered an order approving
various of its motions, including the establishment of Bidding and
Sale Procedures for substantially all assets -- excluding the
Company's cash and accounts receivable. In that context, Resource
Energy Can-Am and American Eagle executed an Asset Purchase
Agreement dated as of Oct. 21, 2015.
Pursuant to the terms and conditions of the Purchase Agreement, at
the "Closing" of the transactions contemplated thereby, the
Purchaser is to pay to us the "Base Purchase Price" of $36,750,000
for substantially all assets -- primarily the hydrocarbon leases
and related operating assets. The Base Purchase Price is subject
to certain adjustments in accordance with the terms and conditions
of the Purchase Agreement, which potential adjustments are
relatively usual and customary for transactions of this type. The
Closing is subject to various usual and customary closing
conditions and, pursuant to the Purchase Agreement, is required to
occur not later than Nov. 30, 2015.
About American Eagle
Littleton, Colorado-based American Eagle Energy Corporation is
engaged in the acquisition, exploration and development of oil and
gas properties. The Company is primarily focused on extracting
proved oil reserves from those properties.
American Eagle Energy Corporation and its wholly-owned subsidiary,
AMZG, Inc., filed on May 8, 2015, voluntary petitions (Bankr. D.
Colo., Case No. 15-15073). The case is assigned to Judge Howard R.
Tallman. The Debtors are represented by Elizabeth A. Green, Esq.,
at Baker & Hostetler LLP, in Orlando, Florida.
On May 13, 2015, Judge Tallman granted the Debtors' request for
joint administration.
American Eagle Energy disclosed total assets of $21,980,687 and
total liabilities of $193,604,113 as of the Chapter 11 filing.
The U.S. Trustee for Region 6 appointed seven creditors to serve on
the Official Committee of Unsecured Creditor. The Committee tapped
Pachulski Stang Ziehl & Jones LLP as counsel, and Conway Mackenzie
as financial advisor.
AMERICAN NATURAL: Creditors Have Until Feb. 15 to File Claims
-------------------------------------------------------------
Creditors of American Natural Energy Corp. have until Feb. 15,
2016, to file their pre-bankruptcy claims against the company.
Meanwhile, all governmental units that have claims against the
company must submit a proof of their claims on or before March 31,
according to an order issued by Judge Elizabeth Magner, who
oversees the company's bankruptcy case.
The 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.
About American Natural
American Natural Energy Corporation, a Tulsa, Oklahoma-based
independent exploration and production company with operations in
St. Charles Parish, Louisiana, was subjected to an involuntary
Chapter 11 petition on Aug. 31, 2015 (Bankr. E.D. La., Case No.
15-122290), by Reamco, Inc., C&M Contractors, Inc., Bayou Fuel
Marine & Hardware Supplies, Inc., and Hillair Capital Investments,
L.P. The Petitioners are represented by Philip Kirkpatrick Jones,
Jr., Esq., at Liskow & Lewis, in New Orleans, Louisiana; and
Michael A. Crawford, Esq., at Taylor, Porter, Brooks & Phillips
LLP, in Baton Rouge, Louisiana.
The U.S. trustee overseeing the Debtor's case appointed three
creditors to the official committee of unsecured creditors. The
creditors are Baker Hughes Oilfield Operations Inc., PAR III Inc.,
and Summa Engineering Inc. The committee is represented by
Lugenbuhl Wheaton Peck Rankin & Hubbard.
ARCHDIOCESE OF ST. PAUL: Has Court Authority to Sell Hayden Center
------------------------------------------------------------------
The Hon. Robert J. Kressel of the U.S. Bankruptcy Court for the
District of Minnesota authorized the Archdiocese of Saint Paul and
Minneapolis to sell the real property located in Ramsey County,
Minnesota, and to execute a lease covering the property.
The order also provided that the Debtor is authorized to enter into
a lease with the Minnesota Historical Society for the property,
with such nonmaterial modifications as may be agreed to by the
parties, and to perform under the lease.
As previously reported by The Troubled Company Reporter, the
property is located at 328 Kellogg Boulevard West in St. Paul,
Minnesota. The Archdiocese was authorized to conduct an auction
for the sale of the real property and improvements, together with
the office building known as the Hayden Center and all
improvements, and easements, rights, privileges and other
hereditaments and appurtenances.
The Archdiocese related that the Hayden Center was valued for
purposes of its schedules at $2,442,800 based upon the
Archdiocese's review of Ramsey County public record, which
reflects
the estimated market value of the Property for tax purposes. The
Archdiocese further related that its schedules also referenced a
June 2013 Cushman analysis which provided an estimated value of
the
Property of between $5,000,000.00 to $7,000,000 and that its
schedules also disclosed that the Hayden. It added that it has
proposed procedures that will permit other parties to submit bids
for the Property and will ultimately maximize the value of the
Hayden Center.
The Archdiocese related that NorthMarq Real Estate Services, LLC
d/b/a Cushman Wakefield ("Cushman"), its retained broker, received
a letter of intent for the purchase of the Hayden Center from the
Minnesota Historical Society ("MHS"). It further related that
after further arms-length negotiations, the Archdiocese entered
into a Purchase Agreement with MHS, with the objective of
utilizing
a competitive auction process in order to maximize the sale price
of the Hayden Center. The Archdiocese believed that MHS has the
ability to close the sale of the Hayden Center property.
The MHS Purchase Agreement contemplates, among others, the
following:
(a) A purchase price of $4,500,000, subject to higher and
better
bids, with an earnest money deposit requirement of $50,000.
(b) A contingency receipt of completion of a rezoning process
or
receipt of a conditional use permit ("CUP") to permit the property
to continue to be used by the MHS for office purposes.
(c) Certain restrictions on the use of the Property to conform
with the requirements of Canon Law and to reflect the fact that
the
Hayden Center has been identified with the Archdiocese by reason
of
its prior use as a Catholic school and its long and continued
ownership and use by the Archdiocese.
(d) That the Archdiocese and the MHS, or an alternative bidder
for the Property, will enter into a lease for an initial term of
one year, after which time the lease will revert to a
month-to-month tenancy. The lease will require payment of base
monthly rent in the net amount of $17,000.00., with rent to accrue
as of February 1, 2016, and payment by the Archdiocese of
operating
expenses with respect to the premises. The lease also provides for
payment to the landlord of the net proceeds received
by the tenant under an operating agreement for parking for events
at the Xcel Center.
The Archdiocese related that it estimates that its parking
arrangement for Xcel events will generate proceeds of between
$14,000 and $17,000 for the period from the beginning of March to
the end of June 2016. The Archdiocese further related that the
lease also provides for shared parking by the MHS and the
Archdiocese during the term of the lease and for use of the
parking
lot by the organizers of the "Red Bull Crashed Ice" event in
February 2016.
About The Archdiocese of Saint Paul
The Archdiocese of Saint Paul and Minneapolis was originally
established by the Vatican in 1850 and serves a geographical area
consisting of 12 greater Twin Cities metro-area counties in
Minnesota, including Ramsey, Hennepin, Anoka, Carver, Chicago,
Dakota, Goodhue, Le Sueur, Rice, Scott, Washington, and Wright
counties. There are 187 parishes and approximately 825,000
Catholic individuals in the region. These individuals and
parishes are served by 3999 priests and 173 deacons.
The Archdiocese of St. Paul and Minneapolis filed for Chapter 11
protection (Bankr. D. Minn. Case No. 15-30125) in Minnesota on
Jan. 16, 2015, saying it has large and growing liabilities related
to child sexual abuse and that its pension obligations are
underfunded.
The Debtor disclosed $45,203,010 in assets and $15,890,460 in
liabilities as of the Chapter 11 filing.
The Debtor has tapped Briggs and Morgan, P.A., as Chapter 11
counsel; BGA Management LLC d/b/a Alliance Management as financial
advisor; Lindquist & Vennum LLP as attorney.
Eleven other dioceses have commenced Chapter 11 bankruptcy cases
in the United States to settle claims from current and former
parishioners who say they were sexually molested by priests.
U.S. Trustee for Region 12 appointed five creditors to serve on
the official committee of unsecured creditors.
The U.S. Trustee appointed five creditors to serve on the
Committee of Parish Creditors. Ginny Dwyer appointed as the acting
chairperson of the committee until such time as the members can
meet and officially elect their own person.
ATI ENTERPRISES: Accuses Williams & Connolly of Overbilling
-----------------------------------------------------------
Michelle Casady at Bankruptcy Law360 reported that the bankruptcy
trustee for a group of vocational schools filed suit in state court
in Dallas Jan. 20, 2016, alleging law firms Williams & Connolly and
Duane Morris billed them for attorneys' fees and expenses that
"exceeded the bounds of reasonableness," for work done in
arbitration of students' claims against ATI Enterprises Inc. The
group, collectively called ATI Entities, alleged in its petition
that the law firms committed breach of contract and breach of
fiduciary duty when it billed for.
ATI Enterprises filed a Chapter 7 bankruptcy petition (Bankr. D.
Del. Case No. 14-10106) on Jan. 21, 2014. The Debtor is
represented by Cousins, Chipman & Brown, LLP. Jeoffrey L. Burtch,
the Chapter 7 trustee, is represented by Susan E. Kaufman.
ATLANTIC CITY, NJ: Gov. Christie Joins in Prevention of Bankruptcy
------------------------------------------------------------------
Alex Wolf at Bankruptcy Law360 reported that New Jersey Gov. Chris
Christie on Jan. 26, 2016, joined with other elected officials to
announce plans for greater state involvement in the financial
affairs of Atlantic City to prevent its dire economic troubles from
worsening to the point of bankruptcy.
Gov. Christie, along with Senate President Steve Sweeney,
D-Gloucester, and Atlantic City Mayor Don Guardian, told reporters
at an afternoon news conference that he intends to pass legislation
allowing state officials to take over elements of the city's
finances for a five-year period.
ATLANTIC CITY, NJ: Moody's Releases Corrected Press Release
-----------------------------------------------------------
On January 29, 2016, following initial publication, Moody's
corrected its press release on Atlantic City, NJ as follows:
The headline is changed to "Moody’s places Atlantic City, NJ Caa1
GO rating under review for possible downgrade" and the first
sentence of the Summary Rating Rationale section is changed
"Moody's Investors Service has placed the City of Atlantic City, NJ
Caa1 GO rating under review for possible downgrade."
The revised release is as follows:
Moody's Investors Service has placed the City of Atlantic City, NJ
Caa1 GO rating under review for possible downgrade. The review for
downgrade will consider the adequacy of proposed legislative budget
solutions and the likelihood of municipal debt restructuring with
bondholder impairment. Within the next two months, Moody's expects
the state legislature to develop a plan that will specify the
powers to be granted to the New Jersey Local Finance Board to
implement budget improvements and restructure municipal debt. The
probability of bondholder impairment is likely low if budget
solutions are adequate and/or state financial support is high, but
could rise if they are not, which would lead to a revision of the
rating downward. A specific indication that bondholders would be
included in adverse debt restructuring could also lead to a rating
downgrade. Beyond the rating review time horizon, outstanding tax
appeal refunds could pose a risk to bondholder security even if
adequate budget measures are achieved.
Factors that Could Lead to an Upgrade/Confirmation
Indication that the state will maintain bondholder
security, even under increased oversight or debt
restructuring
Adoption of legislation that meaningfully augments
city revenues and materially reduces the structural
budget deficit
Factors that Could Lead to a Downgrade
Failure to adopt adequate budget solutions
Indication that bondholder recoveries would
fall below 90% in a potential debt restructuring
Default on debt obligations
Discontinued or significantly lower liquidity support from the
state
Legal Security
The bonds are secured by the city's unlimited ad valorem tax
pledge.
Use of Proceeds. Not applicable
Obligor Profile
Atlantic City is located on the coast in southern New Jersey in
Atlantic County (Aa2 negative). Its economy is based primarily in
the casino industry and tourism. The tax base is still large, at
$11.27 billion in 2014, and will remain large, despite continued
contractions.
Methodology
The principal methodology used in this rating was US Local
Government General Obligation Debt published in January 2014.
BAILEY SHELTER: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Bailey Shelter, LP
600 W. Belt Line Rd
Dallas, TX 75146
Case No.: 16-30509
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Harlin DeWayne Hale
Debtor's Counsel: Melissa S. Hayward, Esq.
FRANKLIN HAYWARD LLP
10501 N. Central Expry, Ste. 106
Dallas, TX 75231
Tel: 972-755-7104
Fax: 972-755-7114
Email: MHayward@franklinhayward.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $0 to $50,000
The petition was signed by John Buttles, Mng Member of Bailey Real
Property
LLC, its general partner.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
BAILEY TOOL: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Bailey Tool & Manufacturing Company
600 W. Belt Line Rd
Lancaster, TX 75146
Case No.: 16-30503
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Barbara J. Houser
Debtor's Counsel: Melissa S. Hayward, Esq.
FRANKLIN HAYWARD LLP
10501 N. Central Expry, Ste. 106
Dallas, TX 75231
Tel: 972-755-7104
Fax: 972-755-7114
Email: MHayward@franklinhayward.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by John Buttles, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
BERNARD L. MADOFF: Court Affirms Use of Inter-Account Method
------------------------------------------------------------
This appeal from a Bankruptcy Court decision arises out of the
infamous Ponzi scheme carried out by Bernard L. Madoff. The appeal
addresses the latest in a series of challenges to decisions by the
court-appointed Trustee administering the estate of Bernard L.
Madoff Investment Securities LLC as to the mechanics by which funds
in the BLMIS customer property estate are to be allocated among
BLMIS's customers.
In an Opinion and Order dated January 14, 2016, which is available
at http://is.gd/unWr2Gfrom Leagle.com, Judge Paul A. Engelmayer of
the United States District Court for the Southern District of New
York affirmed the Order of the Bankruptcy Court approving the use
of the Inter-Account Method and denied the appeals challenging the
Order.
Rejecting claims made by four appellants or groups thereof, Judge
Engelmayer holds that this approach is the only method of
calculating net equity in the context of inter-account transfers
that is consistent with the Second Circuit's Net Equity Decision,
and that it is not prohibited by law.
The case is DIANA MELTON TRUST, DATED 12/05/05, Appellant, v.
IRVING H. PICARD, Trustee for the Liquidation of Bernard L. Madoff
Investment Securities LLC, Appellee. EDWARD A. ZRAICK, JR. et al.,
Appellants, v. IRVING H. PICARD, Trustee for the Liquidation of
Bernard L. Madoff Investment Securities LLC, Appellee. MICHAEL
MOST, Appellant, v. IRVING H. PICARD, Trustee for the Liquidation
of Bernard L. Madoff Investment Securities LLC, Appellee. AARON
BLECKER et al., Appellants, v. IRVING H. PICARD, Trustee for the
Liquidation of Bernard L. Madoff Investment Securities LLC,
Appellee. ELLIOT G. SAGOR, Appellant, v. IRVING H. PICARD, Trustee
for the Liquidation of Bernard L. Madoff Investment Securities LLC,
Appellee, Nos. 15 Civ. 1151 (PAE), 15 Civ. 1195 (PAE), 15 Civ. 1223
(PAE), 15 Civ. 1236 (PAE), 15 Civ. 1263 (PAE), relating to In re
Bernard L. Madoff Investment Securities, LLC, Debtor.
Diana Melton Trust, Dated 12/05/05, Appellant, is represented by
Gaytri D. Kachroo, Esq. -- info@kachroolegal.com -- Kachroo Legal
Services, P.C..
Irving H. Picard, Trustee for the Liquidation of Bernard L. Madoff
Investment Securities LLC, Appellee, is represented by David J.
Sheehan, Esq. -- dsheehan@bakerlaw.com -- Baker & Hostetler LLP,
Seanna R. Brown, Esq. -- sbrown@bakerlaw.com -- Baker & Hostetler
LLP, Amy Elizabeth Vanderwal, Esq. -- Ropes & Gray, LLP & Nicholas
J. Cremona, Esq. -- ncremona@bakerlaw.com -- Baker & Hostetler
LLP.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of New
York granted the application of the Securities Investor Protection
Corporation for a decree adjudicating that the customers of BLMIS
are in need of the protection afforded by the Securities Investor
Protection Act of 1970. The District Court's Protective Order (i)
appointed Irving H. Picard, Esq., as trustee for the liquidation of
BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and
(iii) removed the SIPA Liquidation proceeding to the Bankruptcy
Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr.
Picard has retained AlixPartners LLP as claims agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The petitioning creditors -- Blumenthal &
Associates Florida General Partnership, Martin Rappaport
Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and
Steven Morganstern -- assert US$64 million in claims against Mr.
Madoff based on the balances contained in the last statements they
got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later
transferred to Manhattan. In June 2009, Judge Lifland approved
the
consolidation of the Madoff SIPA proceedings and the bankruptcy
case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to 150
years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.).
From recoveries in lawsuits coupled with money advanced by SIPC,
Mr. Picard has commenced distributions to victims. As of the end
of May 2015, the SIPA Trustee has recovered more than $10.699
billion and has distributed approximately $7.576 billion. When
additional settlements awaiting distribution are taken into
account, the recovery in the Madoff liquidation proceeding totals
$10.734 billion.
BEST PAYPHONES: Court Junks Bid to Review Jurisdiction Ruling
-------------------------------------------------------------
The City of New York and Best Payphones, Inc., have separately
moved for reconsideration of the Court's decision and order
memorialized in In re Best Payphones, Inc., 523 B.R. 54 (Bankr.
S.D.N.Y. 2015) Decision.
In that decision, the Court first recounted the long and complex
history of the case and the various litigations between the
parties. Deciding the issue argued on August 19, 2014, the Court
then concluded that it had subject matter jurisdiction because
neither Art. VIII(c) nor (e) controlled. Notwithstanding their
assigned titles, the 2014 Objections were claims objections, and
Art. VIII(a) of the Plan retained post-confirmation to determine
objections to claims without regard to when they were filed.
Best and Michael Chaite, Best's sole shareholder, have also moved
for reconsideration of the Court's Memorandum Decision and Order
Denying Motion for Stay or an Extension, dated February 10, 2015.
In a Memorandum Decision and Order dated January 13, 2016, which is
available at http://is.gd/UjFg11from Leagle.com, Judge Stuart M.
Bernstein of the United States Bankruptcy Court for the Southern
District of New York denied the City's, Best's and Chaite's motions
for reconsideration of the Decision and the February 10 Order.
The case is In re: BEST PAYPHONES, INC., Chapter 11 Debtor, Case
No. 01-15472 (SMB).
Best Payphones, Inc., Debtor, is represented by David Bolton, Mark
A. Frankel, Esq. -- mfrankel@bfklaw.com -- Backenroth Frankel &
Krinsky, LLP, Joseph P. Garland, Esq. -- Korsinsky & Klein, LLP,
George M. Gilmer, Esq., Esq. -- Law Office of George M. Gilmer,
Larry Ivan Glick, Esq. -- lglick@shutts.com -- Shutts & Bowen LLP,
Joshua N. Koenig, Esq. -- Cohen, Dax & Koenig P.C., Charles H.
Ryans(+).
About Best Payphones
Best Payphones, Inc., commenced its chapter 11 case (Bankr.
S.D.N.Y. Case No. 01-15472) on Oct. 23, 2001. On December 26,
2002, the Bankruptcy Court confirmed the Third Amended Plan of
Reorganization Jointly Proposed by Best Payphones, Inc., and
Michael Chaite, dated Oct. 8, 2002.
The Plan left all classes unimpaired, called for the payment of
administrative claims on the effective date and provided that
allowed unsecured claims would be paid in full on the effective
date together with postpetition interest computed at the annual
rate of 9%. Finally, Chaite would retain his 100% equity interest
in Best.
Following confirmation, Best sold all of its assets to Universal
Telecommunications, Inc., for $1.015 million.
BIONITROGEN HOLDINGS: Compensation Package for CEO Approved
-----------------------------------------------------------
BankruptcyData reported that the U.S. Bankruptcy Court approved
BioNitrogen's motion to implement a compensation package for its
chief executive officer Graham Copley.
As previously reported, "The Debtors believe that the relief sought
herein arises in the ordinary course of business in connection with
corporate governance and operational matters. However, the Debtors
seek to provide notice to all creditors and interested parties and
obtain approval of this Court in the ordinary course of
business...The proposed compensation to
Mr. Copley will be comprised of a base salary of $260,000 per
year....Payment of 60% of Base prorated on a weekly basis (i.e.,
$3,000 per week) and paid on Wednesday of each week (the 'Weekly
60') in addition to reimbursement of actual costs incurred for the
preceding week....Balance of 40% (the 'Deferred 40') as an allowed
Chapter 11 administrative claim to be deferred and paid...
Notwithstanding the foregoing, if the Debtor(s) emerge from Chapter
11 as a reorganized going concern, Copley may, in his sole
discretion, waive payment in cash and retain stock in the
reorganized Debtor(s) equal to the value of the unpaid
compensation."
About BioNitrogen Holdings, Corp.
Miami, Florida-based BioNitrogen Holdings, Corp., formerly known as
Hidenet Securities Architectures, Inc., doing business as
BioNitrogen Corp. and its affiliates filed for Chapter 11
protection (Bankr. S.D. Fla. Case Nos. 15-29505 - 15-29515) on Nov.
3, 2015. The petition was signed by Carlos A. Contreras, chairman
and chief executive officer.
Bankruptcy Judges Robert A. Mark, Laurel M. Isicoff and Jay Cristol
preside over the cases. Jacqueline Calderin, Esq., at Ehrenstein
Charbonneau Calderin represents th Debtors in their restructuring
effort. BioNitrogen Holdings has unknown assets and liabilities of
$3.5 million. BioNitrogen Florida Holdings and BioNitrogen Plant
FL Taylor estimated assets between $0 to $50,000 and debts at $1
million to $10 million.
BOOMERANG SYSTEMS: Can Hire Graham Curtin as Special Patent Counsel
-------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Boomerang Systems, Inc., et al., to employ Graham Curtin, P.A., as
special patent counsel.
The Debtors will pay Graham Curtin an undisputed flat fee of
$26,000 for performance of the services. The Debtors will also
compensate Graham Curtin for any additional late fees reasonably
incurred, which may cumulatively amount to roughly $6,500.
The Debtors, in their employment application, said their most
valuable asset are their patents and thus they need to employ
special patent counsel to make sure that patents are properly
maintained as part of the sales process. The Debtors assure the
Court that Graham Curtin is familiar with their based on prior
representation in unrelated matters.
Graham Curtin discloses that it is a creditor of the Debtors. As
of the Petition Date, Graham Curtin rendered patent and litigation
services worth roughly $140,000 to the Debtors that remain unpaid.
To the best of the Debtors' knowledge, Graham Curtin does not
represent any creditor or other parties-in-interest in any matter
adverse to the Debtors or their estates with respect to the matters
on which Graham Curtin is to be employed.
About Boomerang Systems
Headquartered in Morristown, New Jersey, Boomerang Systems, Inc.
(Pink Sheets: BMER) through its wholly owned subsidiary, Boomerang
Utah, is engaged in the design, development, and marketing of
automated racking and retrieval systems for automobile parking and
automated racking and retrieval of containerized self-storage
units.
Boomerang Systems, Inc., and three affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 15-11729) on Aug. 18,
2015.
The Company has engaged the law firms Togut, Segal & Segal LLP as
general bankruptcy counsel, Ciardi, Ciardi & Astin as local
bankruptcy counsel, and Garden City Group, LLC, as claims and
noticing agent. In addition, the Company has retained the law
firm
Berg & Androphy, which filed a lawsuit on Aug. 18, 2015 in the
Southern District of New York against the Company's defaulting
lender.
The Company's legal advisors are Akin Gump Strauss Hauer & Feld
LLP
in the U.S. and Bennett Jones in Canada. Richards Layton &
Finger,
P.A., is legal co-counsel in the Chapter 11 cases. Houlihan Lokey
Capital, Inc., is serving as financial advisor. Garden City Group
Inc. is the claims and noticing agent.
BOOMERANG SYSTEMS: Hogan McDaniel Okayed as Delaware Counsel
------------------------------------------------------------
The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware authorized Boomerang Systems, Inc., et al., to
employ Hogan McDaniel as Delaware counsel, and as special
litigation counsel for the Liberty Adversary proceeding, nunc pro
tunc to Dec. 23, 2015.
Hogan McDaniel is expected to, among other things:
(1) advise the Debtors of their powers and duties in the
continued operation of their business and management of their
properties;
(2) appear at hearings before the Bankruptcy Court on behalf of
the Debtors, with coordination with the Debtors' counsel; and
(3) take all necessary actions to protect and preserve the
Debtors' estate during the pendency of the Chapter 11 case,
including prosecution of actions by the Debtors, the defense of any
action commenced against the Debtors and negotiations concerning
all litigation in which the Debtors is involved.
The hourly rates of the firm's personnel are:
Professional Position Hourly Rate
------------ -------- -----------
Garvan F. McDaniel, Esq. Member $415
Daniel K. Hogan, Esq. Member $435
Karen E. Harvey Paralegal $205
Gabrielle Durstein Paralegal $205
The Debtors and Hogan McDaniel have agreed the fees and expenses to
be paid will initially not exceed $10,000. To the extent the
actual fees and expenses exceed $10,000, the fees and expenses will
be paid on a pro rata basis from the sales proceeds attributable to
the Debtors' professionals from the sale.
Hogan McDaniel has not received a retainer against its fees or
expenses for services performed for the Debtors.
To the best of the Debtors' knowledge, Hogan McDaniel is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Boomerang Systems
Headquartered in Morristown, New Jersey, Boomerang Systems, Inc.
(Pink Sheets: BMER) through its wholly owned subsidiary, Boomerang
Utah, is engaged in the design, development, and marketing of
automated racking and retrieval systems for automobile parking and
automated racking and retrieval of containerized self-storage
units.
Boomerang Systems, Inc., and three affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 15-11729) on Aug. 18,
2015.
The Company has engaged the law firms Togut, Segal & Segal LLP as
general bankruptcy counsel, Ciardi, Ciardi & Astin as local
bankruptcy counsel, and Garden City Group, LLC, as claims and
noticing agent. In addition, the Company has retained the law
firm
Berg & Androphy, which filed a lawsuit on Aug. 18, 2015 in the
Southern District of New York against the Company's defaulting
lender.
The Company's legal advisors are Akin Gump Strauss Hauer & Feld
LLP
in the U.S. and Bennett Jones in Canada. Richards Layton &
Finger,
P.A., is legal co-counsel in the Chapter 11 cases. Houlihan Lokey
Capital, Inc., is serving as financial advisor. Garden City Group
Inc. is the claims and noticing agent.
BOOMERANG TUBE: Resolves Meta-Fee Concern in Chapter 11 Plan
------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Boomerang Tube
said on Jan. 25, 2016, that its unsecured creditors committee has
resolved a dispute with the U.S. trustee over language in the
Chapter 11 plan that the bankruptcy watchdog said would violate a
U.S. Supreme Court rule that prevents attorneys from recovering
costs for defending the fees they charge.
Boomerang in court papers responded to an objection brought by
acting U.S. Trustee for Delaware Andrew Vara over his concern that
language in the proposed plan violates a ban on the Debtor's
attorneys being compensated by the estate.
About Boomerang Tube
Boomerang Tube, LLC, is a manufacturer of welded Oil Country
Tubular Goods ("OCTG") in the United States. OCTG are used by
drillers in exploration and production of oil and natural gas and
consist of drill pipe, casing and tubing. Boomerang has corporate
offices in Chesterfield, Missouri and manufacturing facilities in
Liberty, Texas, strategically located near major steel production
centers and end-user markets. With a 487,000 square foot plant
that houses two mills and heat treat lines and a contingent 119
acres, these facilities constitute the second largest alloy OCTG
mill in North America. Access Tubulars, LLC, owns 81% of the
equity interests in Boomerang.
Boomerang Tube and its subsidiaries BTCSP LLC and BT Financing
sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
15-11247) on June 9, 2015, with a deal with lenders on a balance
sheet restructuring that would convert $214 million of debt to 100%
of the common stock of the reorganized company.
The cases are assigned to Judge Mary F. Walrath.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP, as
attorneys; Lazard Freres & Co. LLC, as financial advisor; and
Donlin, Recano & Co., Inc., as claims and noticing agent.
C4 PERFORMANCE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: C4 Performance, LLC
dba Oasis Beach and Tennis Club
5757 S. State Highway 205
Rockwall, TX 75032
Case No.: 16-30502
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Stacey G. Jernigan
Debtor's Counsel: Eric A. Liepins, Esq.
ERIC A. LIEPINS, P.C.
12770 Coit Rd., Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
Email: eric@ealpc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dr. Federico Maese, managing member.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/txnb16-30502.pdf
CAFARELLI METALS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Cafarelli Metals, Inc.
600 W. Belt Line Rd
Dallas, TX 75146
Case No.: 16-30507
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Stacey G. Jernigan
Debtor's Counsel: Melissa S. Hayward, Esq.
FRANKLIN HAYWARD LLP
10501 N. Central Expry, Ste. 106
Dallas, TX 75231
Tel: 972-755-7104
Fax: 972-755-7114
Email: MHayward@franklinhayward.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by John Buttles, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
CCNG ENERGY: Amends List of Largest Unsecured Creditors
-------------------------------------------------------
CCNG Energy Partners, L.P., et al., filed with the U.S. Bankruptcy
Court for the Western District of Texas amended list of creditors
holding 20 largest unsecured claims.
The amendment reflect, among other tings, the addition of CCNG,
Inc., in the list; ommission of Great American Insurance Co., and
Graves Dougherty Hearon & Mood from the list; decrease in the
amount of Simpson Thacher & Bartlett LLP's claim, and increase in
the amount of claim of Deloitte Transactions and Bus An, and Docvue
LLC.
The new list disclosed:
Name of Creditor Nature of Claim Amount of Claim
---------------- --------------- ---------------
BDO $505,980
P.O. Box 31001 0860
Pasadena, Ca 91110-0860
Deloitte Transactions and Bus An $54,010
Simpson Thacher & Bartlett LLP $25,000
Latham & Watkins LLP $23,688
Tranbarger & Company LLP $20,725
Oil & Gas Information $19,843
Grant Thornton LLP $16,365
Docvue LLC $11,886
CCNG, Inc. $9,841
Real Time Zone Inc. $5,587
WM Shirley $4,000
Office Mate $3,797
BridgePoint Consulting $3,750
Modular Space Corp. $3,634
Drilling Info Inc. $2,708
Spanish Oaks Golf Club $2,633
Insight Direct USA Inc. $2,597
U.S. Bank $2,228
Merrill Communications LLC $1,890
Full Circle Systems $4,450
About CCNG Energy
CCNG Energy Partners, L.P. (the "Parent"), CCNG Energy Partners GP,
L.L.C. ("CCNG GP"), Trinity Environmental SWD, L.L.C., Trinity
Environmental Catarina SWD, L.L.C., Trinity Environmental Titan
Trucking, L.L.C., Moss Bluff Property, L.L.C. and Trinity
Environmental Services, L.L.C. (collectively, the "Operating
Subsidiaries") filed Chapter 11 bankruptcy petitions (Bankr. W.D.
Tex. Proposed Lead Case No. 15-70136) on Oct. 12, 2015. The
petition was signed by Daniel B. Porter as CEO of General Partner.
All of the Debtors' operations are performed by the Operating
Subsidiaries.
The Debtors estimated both assets and liabilities in the range of
$100 million to $500 million.
Taube Summers Harrison Taylor Meinzer Brown LLP serves as the
Debtors' counsel.
Judge Ronald B. King is assigned to the case.
The Debtors are engaged in the disposal of produced saltwater and
waste from the exploration and production of oil and gas.
In 2015, the Office of the U.S. Trustee appointed six creditors to
the official committee of unsecured creditors. The creditors are
Sun Coast Resources Inc., KBK Industries, Sabine Storage &
Operations Inc., Cambrian Management Ltd., WLP Oilfield Services,
and Dolphin Services & Chemicals LLC.
CHRYSLER LLC: Blasts Sanctions Bid in Dealer Agreement Row
----------------------------------------------------------
Dani Meyer at Bankruptcy Law360 reported that Chrysler LLC told a
Michigan federal judge on Jan. 25, 2016, that a Detroit dealership
is trying to use its motion for sanctions accusing the automaker of
backing out of a sales agreement to revive a fight it lost when the
Sixth Circuit found a letter of intent offered to the dealership
was sufficient.
Village Chrysler Jeep Inc. had accused Chrysler successor FCA US
LLC of refusing to honor their agreement and demanded sanctions
against the automaker, but Chrysler responded on Jan. 25.
About Old Carco LLC (f/k/a Chrysler LLC)
Chrysler Group LLC, formed in 2009 from a global strategic alliance
with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck,
Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and
products. Headquartered in Auburn Hills, Michigan, Chrysler Group
LLC's product lineup features some of the world's most recognizable
vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck.
Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11
protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case
No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut
Segal & Segal LLP, as conflicts counsel; Capstone Advisory
GroupLLC, and Greenhill & Co. LLC, for financial advisory services;
and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler
changed its corporate name to Old CarCo following its sale to a
Fiat-owned company. As of Dec. 31, 2008, Chrysler had
$39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler
had $1.9 billion in cash at that time.
In connection with the bankruptcy filing, Chrysler reached an
agreement with Fiat SpA, the U.S. and Canadian governments and
other key constituents regarding a transaction under Section 363 of
the Bankruptcy Code that would effect an alliance between Chrysler
and Italian automobile manufacturer Fiat. As part of that deal,
Fiat acquired a 20% equity interest in Chrysler Group.
Under the terms approved by the Bankruptcy Court, the company
formerly known as Chrysler LLC on June 10, 2009, formally sold
substantially all of its assets, without certain debts and
liabilities, to a new company that will operate as Chrysler Group
LLC. The U.S. and Canadian governments provided Chrysler with $4.5
billion to finance its bankruptcy case. Those loans are to be
repaid with the proceeds of the bankruptcy estate's liquidation.
Old Carco's Second Amendment Joint Plan of Liquidation was
confirmed by the Bankruptcy Court on April 23, 2010.
CIVITAS SOLUTIONS: S&P Assigns 'B+' CCR, Outlook Positive
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to home and community based-health and human services
provider Civitas Solutions Inc. on Jan. 29, 2016. The outlook is
positive. In conjunction with this rating action, Standard &
Poor's Ratings Services withdrew its 'B+' corporate credit rating
National Mentor Holdings Inc.
At the same time, S&P affirmed its 'B+' issue-level rating on
National Mentor Holdings Inc.'s senior secured credit facility. The
recovery rating on this debt remains '3', indicating expectations
for meaningful (50% to 70%; at the high end of the range) recovery
in the event of a payment default.
S&P's positive outlook on Civitas is based on outperformance
relative to S&P's previous 2015 base-case projections, and
potential for a higher rating if Civitas meets our base-case
projections through 2016 and if the increasing public ownership of
the company results in a less aggressive financial policy. Civitas'
operating performance over the past several quarters, as measured
by margins, has been stronger than S&P's expectations, due to lower
labor and insurance costs.
"Our positive outlook on Civitas Solutions Inc. reflects our view
that improving EBITDA margins in 2016 and 2017 will sustain
leverage below 4x," said Standard & Poor's credit analyst James
Uko. In S&P's view, these measures would result in a credit
profile consistent with a 'BB-' corporate credit rating, as opposed
to a 'B+.' However, consideration for a rating upgrade will be
influenced by the company's financial policy as it adjusts to its
growing public ownership.
S&P could lower its outlook to stable if adjusted leverage were to
rise and remain above 5x. This could be the result of significant
adverse reimbursement changes, difficulty integrating acquisitions,
or greater competition that hurts revenue growth that could
contribute to an EBITDA margin contraction of about 200 to 250
basis points. It could also be caused by a large debt-financed
acquisition of more than $180 million.
S&P could consider an upgrade if, in its view, the company could
achieve and sustain leverage below 4x and the financial policy
becomes less aggressive as the financial sponsor relinquishes its
majority stake in the company over the near term. This scenario
would entail an increase of revenue into low-double-digit range and
a 50 to 100 basis point margin improvement.
DISTRICT OF MCALLEN: Can Hire Adolfo Campero as Counsel
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
authorized The District At Mcallen, L.P., to employ Adolfo Campero,
Jr. of the law firm of Campero & Associates, P.C., as its counsel.
Mr. Campero is expected to, among other things:
(a) give the Debtor legal advice with respect to its powers and
duties in the case;
(b) take necessary action to avoid preferential or fraudulent
transfers and to avoid any liens against the Debtor's property
obtained by attachment, garnishment, levy or seizure of creditors,
within 90 days before the filing of the petition; and
(c) prepare on behalf of the Debtor any and all necessary
amendments, applications, answers, orders, reports and other legal
papers.
The Debtor agreed to pay the firm's hourly rates:
Adolfo Campero, Jr. $300
Paralegal $175
Mr. Campero received a $20,000 retainer upon acceptance of the
case.
Mr. Campero, for the purpose of full disclosure, said that he is
also representing HRP Investments, L.P., in a Chapter 11 case
commenced on Aug. 31, 2015, pending in the U.S. Bankruptcy Court
for the Southern District of Texas, McAllen Division. Moreover,
both HRP and Debtor have common indirect ownership. More
specifically, Carlos Holt owns 100% of the membership units of two
Texas limited liability companies that each separately serve as the
general partner of HRP and Debtor.
Mr. Holt is the sole manager of each of the general partners of
Debtor and HRP and also guarantees debt of Debtor and HRP, as
reflected in their respective schedules. Because of the common
indirect ownership between Debtor and HRP, there have been
transfers of funds between the companies and, as a result,
intercompany claims may exist.
The Debtor has made several applications but was withdrawn. On
Sept. 3, 2015, the Debtor notified the Court that it has withdrawn
the application for leave to employ Mr. Campero as attorney. The
motion was filed on Sept. 2.
On Sept. 2, the Debtor has withdrawn the application to employ Mr.
Campero which was filed by HRP Investments, L.P., on Aug. 31.
According to the Debtor's case docket, a meeting of creditors has
been scheduled for Sept. 22, 2015, and proofs of claim are due Dec.
21.
The firm can be reached at
Adolfo Campero, Jr.
CAMPERO & ASSOCIATES, P.C.
315 Calle Del Norte, Suite 207
Laredo, TX 78041
Tel: (956) 796-0330
Fax: (956) 796-0399
About The District at McAllen, LP
Dr. Ernesto Ramirez filed an involuntary Chapter 11 bankruptcy
petition against McAllen, Texas-based The District at McAllen LP
(Bankr. S.D. Tex., Case No 14-70661) on Dec. 2, 2014. The
petitioner's counsel is Nathaniel Peter Holzer, Esq., at Jordan
Hyden Womble Culbreth & Holzer PC.
ENERGY FUTURE: $300M Texas Mines Settlement with Alcoa Approved
---------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that a Delaware
bankruptcy judge signed off on Jan. 22, 2016, on a settlement
between Energy Future Holdings and aluminum manufacturer Alcoa that
resolves a dispute over Texas mines and a smelting facility in a
deal that EFH said is worth $300 million to its estate.
U.S. Bankruptcy Judge Christopher Sontchi said in an order that
approving the settlement is in the "best interests of the Debtors'
estates and creditors." The deal, submitted to the court earlier
this month, resolves disputes between EFH unit Luminant Generation
Co. LLC.
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.
FIRST HORIZON: Fitch Affirms 'B' Preferred Stock Rating
-------------------------------------------------------
Fitch Ratings has affirmed the long-term and short-term Issuer
Default Ratings of First Horizon National Corporation (FHN) and its
subsidiaries at 'BBB-' and 'F3', respectively. The Rating Outlook
is Stable. Fitch also affirmed FHN's Viability Rating (VR) at
'bbb-'.
The rating action follows a periodic review of the midtier regional
banking group, which includes BankUnited Inc. (BKU), BOK Financial
Corp. (BOKF), Cathay General Bancorp (CATY), East West Bancorp
(EWBC), First Republic Bank (FRC), First Horizon National Corp.
(FHN), First National of Nebraska Inc. (FNNI), Fulton Financial
Corp. (FULT), Hilltop Holdings, Inc. (HTH), Synovus Financial Corp.
(SNV), TCF Financial Corp. (TCB), Trustmark Corp. (TRMK), UMB
Financial Corp. (UMBF) and Wintrust Financial Corp. (WTFC).
Company-specific rating rationales for the other banks are
published separately, and for further discussion of the midtier
regional bank sector in general, refer to the special report titled
'US Banks: Midtier Regional Bank Periodic Review,' to be published
shortly.
KEY RATING DRIVERS
VRs, IDRs and SENIOR UNSECURED DEBT
The affirmation of FHN's IDR and VR is driven by the entity's good
capital profile, strong banking franchise, and niche capital
markets business that caters to smaller, community bank-sized
financial institutions. Fitch views FTN Financial (FTN) favorably
as it provides good levels of non-interest income and revenue
diversity, while assuming low levels of market risk. Today's
rating action is also supported by the resolution of significant
litigation risk through its 2Q'15 mortgage settlement. Fitch's
ratings also incorporate the expectation that FHN will continue
working through its nonstrategic assets with manageable credit
losses going forward.
At Dec. 31, 2015, FHN reported Basel III Common Equity Tier 1
capital of 10.45% and Tangible Common Equity of 7.82%, both
relatively in line with peer medians. Fitch anticipates that
capital will continue to come down over time but expects management
to maintain sufficient levels of capital relative to its risk
profile. FHN is targeting a long-term CET1 target of 8% to 9%,
which Fitch views as reasonable relative to the company's current
risk profile
Additionally, FHN's deposit gathering capabilities within its core
footprint remains strong, accounting for the best deposit market
share in the state of Tennessee with 13.7% of total deposits. FHN's
strong deposit franchise has translated into lower than peer
deposit costs.
Loans within the nonstrategic portfolio totaled $2.0 billion
through 4Q'15, accounting for a still sizeable 11% of total loans,
though down considerably from its peak. Fitch recognizes
management's ability to work through the nonstrategic portfolio
without outsized credit losses over recent periods. Consolidated
NCOs over the last 10 quarters have averaged a manageable 29bps.
Fitch expects that nonstrategic balances will continue to decline
over time.
FHN has announced various legal settlements associated with its
nonstrategic loan portfolio and business line over the past two
years. Fitch views the legal settlements as credit positive,
removing some of the risk created by its national mortgage lending
platform, which has since been discontinued. Moreover, Even with
the various one-time settlement charges, the company's capital
profile remained good. Fitch believes that much of FHN's legal
overhang is now behind it, which should aid in the company
generating more consistent earnings as legal costs diminish,
resulting in a credit positive over time.
FHN's core business operations include First Tennessee Bank
National Association (FTBNA) and FTN, the company's capital markets
division. Both FTBNA and FTN continue to perform well and in line
with Fitch's expectations. Return on average assets (ROAA) for
FTBNA over the last three years has averaged 1.42%. FTN has also
been accretive to earnings even as average daily revenue (ADR) for
the line has remained well below management's stated long-term
target of $1.0 million to $1.5 million.
Despite an expectation that earnings volatility will be less over
the near term given the resolution of a significant amount of
litigation risk, Fitch considers the company's current level of
earnings to be a rating constraint over the near term. Even with
solid earnings performance out of its core business lines, overall
company earnings lag the peer median due to the presence of the
nonstrategic loan book and corporate activities.
Further constraining the company's rating over the near term are
elevated levels of nonperforming assets (NPAs). Fitch-calculated
NPAs through 3Q'15 totaled 2.50% of loans and other real estate
owned (OREO), above the peer average of around 1.50%. Large
balances of restructured residential loans originated out of the
company's former national lending platform account for the majority
of the NPAs. Restructured residential loans are generally
difficult to remove from the balance sheet, which is why Fitch
expects FHN's NPA ratio to remain elevated relative to peers over
the near-to-intermediate time horizon.
FHN continues to exhibit solid liquidity and funding. As
mentioned, FHN's funding primarily consists of its large, in
foot-print non-interest-bearing deposit base, accounting for nearly
30% of total deposits at 3Q15. FHN also has access to multiple
sources of secured borrowing, such as the FHLB. These sources were
modestly used at 3Q15 and still have adequate capacity.
SUBORDINATED DEBT and OTHER HYBRID SECURITIES
FHN and its operating companies' subordinated debt is notched one
level below its VR of 'bbb-' for loss severity. FHN's preferred
stock is notched five levels below its VR, two times for loss
severity and three times for non-performance. These ratings are in
accordance with Fitch's criteria and assessment of the instruments
non-performance and loss severity risk profiles.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The uninsured deposit ratings of FHN are rated one notch higher
than FHN's IDR and senior unsecured debt because U.S. uninsured
deposits benefit from depositor preference. U.S. depositor
preference gives deposit liabilities superior recovery prospects in
the event of default.
HOLDING COMPANY
FHN's IDR and VR are equalized with those of its operating company
(FTBNA), reflecting its role as the bank holding company, which is
mandated in the U.S. to act as a source of strength for its bank
subsidiaries. Ratings are also equalized reflecting the very close
correlation between holding company and subsidiary failure and
default probabilities.
SUPPORT RATING AND SUPPORT RATING FLOOR
FHN has a Support Rating of '5' and Support Rating Floor of 'NF'.
In Fitch's view, FHN is not systemically important and therefore,
the probability of support is unlikely. IDRs and VRs do not
incorporate any support.
RATING SENSITIVITIES
VRs, IDRs and SENIOR UNSECURED DEBT
Fitch believes there is limited downside risk to FHN's ratings
given the company's strong franchise in key operating markets.
While FHN's NPAs are likely to remain elevated relative to peers
due to high balances of restructured residential mortgage loans,
positive rating momentum could occur if FHN's other credit metrics,
namely credit losses and delinquencies, perform better than peers
as the credit environment worsens.
Furthermore, higher and more consistent earnings can also lead to
positive rating action. Given the company's asset sensitivity,
FHN's balance sheet is well positioned for a rising rate
environment and may generate higher relative earnings than peers.
This is mainly due to 70% of total assets are set to reprice within
one year and 67% of total loans are variable rate.
Conversely, negative rating action may occur in the event of
material asset quality deterioration. Fitch notes that over the
next 24 months 37% of FHN's home equity lines of credit (HELOC)
balances still in the draw period are set to convert to fully
amortizing loans, which present repayment risk. Though these
maturing balances account for just 3% of total loans, Fitch will
continue to closely monitor their performance. Should performance
of maturing HELOCs materially decline once in repayment, negative
rating action could be taken.
Similarly, negative rating action could occur in the event capital
is aggressively managed down given management's long-term capital
expectations. Fitch views aggressive capital management at FHN
unlikely.
Fitch notes that the ratings action incorporates the view that FHN
will be active in the merger and acquisition (M&A) space going
forward as the company pursues expansion into neighbouring states
and select metropolitan areas that management deem appropriate and
in line with FHN's business model. Fitch would analyse any
individual transaction for its strategic and financial
implications, which may lead to rating changes.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
The ratings for FHN and its operating companies' subordinated debt
and preferred stock are sensitive to any change to FHN's VR.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The long- and short-term deposit ratings are sensitive to any
change to FHN's long- and short-term IDR.
HOLDING COMPANY
Should FHN's holding company begin to exhibit signs of weakness,
demonstrate trouble accessing the capital markets, or have
inadequate cash flow coverage to meet near-term obligations, there
is the potential that Fitch could notch the holding company IDR and
VR from the ratings of the operating companies.
SUPPORT RATING AND SUPPORT RATING FLOOR
Since FHN's Support and Support Rating Floors are '5' and 'NF',
respectively, there is limited likelihood that these ratings will
change over the foreseeable future.
Fitch affirms these ratings:
First Horizon National Corporation
-- Long-term IDR at 'BBB-'; Outlook Stable;
-- Viability at 'bbb-';
-- Short-term IDR at 'F3';
-- Senior Unsecured at 'BBB-';
-- Preferred Stock at 'B';
-- Support at '5';
-- Support Floor at 'NF'.
First Tennessee Bank, N.A.
-- Long-term IDR at 'BBB-'; Outlook Stable;
-- Viability at 'bbb-';
-- Short-term IDR at 'F3';
-- Long-term Deposits at 'BBB';
-- Short-term Deposits at 'F3';
-- Senior Unsecured at 'BBB-';
-- Subordinated Debt at 'BB+';
-- Preferred Stock at 'B';
-- Support at '5';
-- Support Floor at 'NF.
FIRST NATIONAL OF NEBRASKA: Fitch Affirms 'BB+' Sub. Debt Rating
----------------------------------------------------------------
Fitch Ratings has affirmed First National of Nebraska Inc.'s (FNNI)
and First National Bank of Omaha's ratings at 'BBB-/F3'. The Rating
Outlook has been revised to Positive from Stable.
The rating action follows a periodic review of the midtier regional
banking group, which includes BankUnited Inc. (BKU), BOK Financial
Corp. (BOKF), Cathay General Bancorp (CATY), East West Bancorp
(EWBC), First Republic Bank (FRC), First Horizon National Corp.
(FHN), First National of Nebraska Inc. (FNNI), Fulton Financial
Corp. (FULT), Hilltop Holdings, Inc. (HTH), Synovus Financial Corp.
(SNV), TCF Financial Corp. (TCB), Trustmark Corp. (TRMK), UMB
Financial Corp. (UMBF) and Wintrust Financial Corp. (WTFC).
Company-specific rating rationales for the other banks are
published separately, and for further discussion of the midtier
regional bank sector in general, refer to the special report titled
'US Banks: Midtier Regional Bank Periodic Review,' to be published
shortly.
KEY RATING DRIVERS
IDRs, VRs, and SENIOR DEBT
The affirmation of FNNI's ratings reflects the company's continued
stable operating performance, additional improvement in asset
quality ratios, as well as the maintenance of reasonable regulatory
capital ratios.
Fitch's Positive Outlook reflects the view that FNNI's operating
performance could strengthen further over the near to medium term
and potentially warrant a higher rating. This view is based on
Fitch's expectation that FNNI's earnings and profitability should
improve as it continues to build out additional strategic
partnerships in its credit card portfolio. Moreover, Fitch expects
FNNI's overall credit quality continues to remain solid going
forward as much of its more volatile business lines have been
reduced significantly since the crisis such as national credit card
lending along with construction and land development lending.
Fitch believes these potential positives should also allow FNNI to
continue to enhance its returns while maintaining a reasonable
credit risk profile and solid capital ratios. This could allow
FNNI to compare more favorably with higher rated entities over the
rating horizon.
FNNI has been generating a relatively higher level earnings
compared to similarly rated peers over recent periods. The company
generated a return on average assets (ROAA) of 1.10% through third
quarter 2015 (3Q15) compared to 1.04% the year prior. Earnings
stability has been accomplished through continued improvement in
overhead expense as well as the company's ability to maintain an
above-average net interest margin (NIM).
FNNI's ability to maintain its margin in the ongoing low rate
environment is a rating strength and is primarily due to continued,
balanced growth in both its credit card portfolio (9.7% YoY) and
its regional bank franchise (4.6%). Fitch views FNNI's level of
growth as reasonable and points toward not only sound risk
management controls but also the company's strengthening franchise
in the partnership credit card space.
FNNI's asset quality continues to improve. Both past-due loans and
non-accrual loans have come down over the past year. From 3Q'14 to
3Q15, non-accruing loans-to-total loans dropped from 0.75% to 0.64%
while 30-89 days past due (a forward-looking metric useful in
evaluating for credit card issuers) were down to 0.54% from 0.64%.
Both measures are at some of their lowest levels dating back to
before the financial crisis.
Meanwhile, net charge-offs (NCOs) have more or less levelled off
under 1.50% Fitch continues to expect asset quality improvements to
be nominal over the near- to medium-term as card performance across
the industry has reached its peak and non-card credit losses remain
stable. However, as noted above, Fitch expects FNNI's card
portfolio to behave differently in a more stressed cycle compared
to 2007-2010. This is due to management pivoting away from growing
the bank's national card portfolio that is typically lower credit
quality. Instead, focus has been placed on more
transaction-oriented, co-branded cardholders that tend to produce
relatively lower levels of credit losses through a cycle. This
continued rebalancing of the portfolio all while maintaining good
capital levels is reflected in the Outlook revision to Positive
from Stable.
Fitch views capital levels and capital management as appropriate
relative to FNNI's overall risk profile. FNNI's core capital
ratios (measured by Fitch Core Capital [FCC] to total assets) was
augmented by nearly 50 basis points (bps) over the last year to
9.36% while risk-based capital ratios remain well-above regulatory
minimums. Fitch views these levels as adequate when considering
the bank's relatively more limited access to the capital markets
given its private ownership, the bank's exposure to the consumer
through its credit card book and to the fairly stable economies in
which its regional bank operates (primarily Nebraska, Colorado and
Kansas). Fitch's expectation that capital will continue to be
maintained in a prudent manner such that dividend payout ratios
remain reasonable and regulatory capital ratios are augmented is
reflected in the rating affirmation and Positive Outlook.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
FNNI's subordinated debt is notched one level below its VR of
'bbb-' for loss severity. These ratings are in accordance with
Fitch's criteria and assessment of the instruments non-performance
and loss severity risk profiles.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The uninsured deposit ratings of First National of Omaha are rated
one notch higher than FNNI's IDR and senior unsecured debt because
U.S. uninsured deposits benefit from depositor preference. U.S.
depositor preference gives deposit liabilities superior recovery
prospects in the event of default.
HOLDING COMPANY
FNNI's IDR and VR are equalized with those of First National Bank
of Omaha, reflecting its role as the bank holding company, which is
mandated in the U.S. to act as a source of strength for its bank
subsidiaries. The entities' ratings are also equalized reflecting
the very close correlation between holding company and subsidiary
failure and default probabilities.
SUPPORT RATING AND SUPPORT RATING FLOOR
FNNI has a Support Rating of '5' and Support Rating Floor of 'NF'.
In Fitch's view, FNNI is not systemically important and therefore,
the probability of support is unlikely. The IDRs and VRs do not
incorporate any support.
RATING SENSITIVITIES
VR, IDRs, and SENIOR DEBT
The Outlook revision to Positive from Stable reflects Fitch's view
that there is potential upside to FNNI's current ratings over the
rating time horizon.
Upward rating movement is predicated on FNNI maintaining sound,
consistent earnings at levels similar to higher rated peers. To
the extent that the bank accomplishes this while sustaining solid
credit quality, including relatively better NCOs in its credit card
book, and capital levels above peer averages, Fitch would likely
take positive rating action.
Alternatively, factors that could negatively weigh on FNNI's
ratings include stagnant or worsening operating performance,
deterioration in the loan portfolio outside of current
expectations, as well as any significant shareholder capital
distributions.
The latter could constrain upward ratings momentum to the extent
that distributions either slow FNNI's capital build relative to
similarly rated institutions or even cause the company's capital
ratios to decline on an absolute basis.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
The ratings for FNNI and its operating companies' subordinated debt
are sensitive to any change to FNNI's VR.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The long- and short-term deposit ratings are sensitive to any
change to FNNI's long-and short-term IDR.
HOLDING COMPANY
Should FNNI's holding company begin to exhibit signs of weakness,
demonstrate trouble accessing the capital markets, or have
inadequate cash flow coverage to meet near-term obligations, there
is the potential that Fitch could notch the holding company IDR and
VR from the ratings of the operating companies.
SUPPORT RATING AND SUPPORT RATING FLOOR
Since FNNI's Support and Support Rating Floors are '5' and 'NF',
respectively, there is limited likelihood that these ratings will
change over the foreseeable future.
The rating actions are:
Fitch has affirmed these ratings with a Positive Outlook:
First National of Nebraska, Inc.
-- Long-term IDR at 'BBB-';
-- Viability at 'bbb-'.
-- Short-term IDR at 'F3';
-- Support Ratings at '5';
-- Support Rating Floor at 'NF'.
First National Bank of Omaha
-- Long-term IDR at 'BBB-';
-- Viability at 'bbb-';
-- Long-term deposits at 'BBB';
-- Short-term deposits as 'F2';
-- Short-term IDR at 'F3';
-- Subordinated debt at 'BB+';
-- Support Ratings at '5';
-- Support Rating Floor at 'NF'.
GABRIEL ENTERPRISES: Case Summary & 2 Top Unsecured Creditors
-------------------------------------------------------------
Debtor: Gabriel Enterprises, LLC
40 Floyd Road
Verona, NJ 07044
Case No.: 16-11759
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
District of New Jersey (Newark)
Judge: Hon. Stacey L. Meisel
Debtor's Counsel: David L. Stevens, Esq.
SCURA, WIGFIELD, HEYER & STEVENS, LLP
1599 Hamburg Turnpike
Wayne, NJ 07470
Tel: 973-696-8391
Email: dstevens@scuramealey.com
Total Assets: $1.21 million
Total Liabilities: $1.40 million
The petition was signed by Herns Gabriel, member.
A list of the Debtor's two largest unsecured creditors is available
for free at http://bankrupt.com/misc/njb16-11759.pdf
GARLOCK SEALING: John Crane Intervening in Racketeering Suits
-------------------------------------------------------------
Emily Field at Bankruptcy Law360 reported that John Crane Inc.
asked a North Carolina federal judge on Jan. 25, 2016, to let it
intervene in two racketeering suits involving asbestos injury
settlements between law firms and defunct gasket maker Garlock
Sealing Technologies LLC, saying that it, too, was swindled.
John Crane said in two motions to intervene that it had been a
co-defendant in many of the mesothelioma cases Dallas-based Simon
Greenstone Panatier Bartlett PC and Philadelphia firm Shein Law
Center Ltd. had brought against Garlock and that, like Garlock, it
was defrauded by the firms.
About Garlock Sealing
Headquartered in Palmyra, New York, Garlock Sealing Technologies
LLC is a unit of EnPro Industries, Inc. (NYSE: NPO). For more than
a century, Garlock has been helping customers efficiently seal the
toughest process fluids in the most demanding applications.
On June 5, 2010, Garlock filed a voluntary Chapter 11 petition
(Bankr. W.D.N.C. Case No. 10-31607) in Charlotte, North Carolina,
to establish a trust to resolve all current and future asbestos
claims against Garlock under Section 524(g) of the U.S. Bankruptcy
Code. The Debtor estimated $500 million to $1 billion in assets
and up to $500 million in debts as of the Petition Date.
Affiliates The Anchor Packing Company and Garrison Litigation
Management Group, Ltd., also filed for bankruptcy.
Albert F. Durham, Esq., at Rayburn Cooper & Durham, P.A.,
represents the Debtor in their Chapter 11 effort. Garland S.
Cassada, Esq., at Robinson Bradshaw & Hinson, serves as counsel for
asbestos matters.
The Official Committee of Asbestos Personal Injury Claimants in the
Chapter 11 cases is represented by Travis W. Moon, Esq., at
Hamilton Moon Stephens Steele & Martin, PLLC, in Charlotte, NC,
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, in New
York, and Trevor W. Swett III, Esq., Leslie M. Kelleher, Esq., and
Jeanna Rickards Koski, Esq., in Washington, D.C. 20005.
Joseph W. Grier, III, the Court-appointed legal representative for
future asbestos claimants, has retained A. Cotten Wright, Esq., at
Grier Furr & Crisp, PA, and Richard H. Wyron, Esq., and Jonathan
P. Guy, Esq., at Orrick, Herrington & Sutcliffe LLP, as his
co-counsel.
Judge George Hodges of the U.S. Bankruptcy Court for the Western
District of North Carolina on Jan. 10, 2014, entered an order
estimating the liability for present and future mesothelioma claims
against Garlock Sealing at $125 million, consistent with the
positions GST put forth at trial.
In January 2015, the Debtors filed their Second Amended Plan of
Reorganization, which is backed by the Future Asbestos Claimants'
Representative (FCR). The confirmation hearing is slated to begin
June 20, 2016.
Under the schedule for confirmation proceedings ordered by the
Court, objections to confirmation of the Plan that do not depend on
the results of voting were due Oct. 6, 2015, and confirmation
objections that depend on such results are due on Dec. 18, 2015.
GEOFFREY EDELSTEN: Fla. Judge Axes Malpractice Row Lead by Trustee
------------------------------------------------------------------
Shayna Posses at Bankruptcy Law360 reported that a Florida federal
judge on Jan. 25, 2016, granted bids to toss malpractice litigation
against Geoffrey Edelsten's former attorneys, holding that the
Australian ex-doctor's bankruptcy trustee was vague as to alleged
conflicts of interest and failed to show a binding contract between
the debtors and the lawyers.
In a brief order, U.S. District Judge Darrin P. Gayles concluded
that Chapter 7 Trustee Soneet Kapila failed to state a claim in his
suit alleging that the attorneys conspired to negligently represent
Edelsten in connection with his business relationships.
GFD CONSTRUCTION: Case Summary & 3 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: GFD Construction, Inc.
fdba GFD Sand Pit, Inc.
470 E. Ensley St.
Pensacola, FL 32514
Case No.: 16-30087
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Florida (Pensacola)
Judge: Hon. Jerry C. Oldshue Jr.
Debtor's Counsel: Brandi Thomas, Esq.
AKBAR LAW FIRM, PA
619 N. Copeland St.
Tallahassee, FL 32304
Tel: 850-383-0000
Email: brandi@akbarlawfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Anthony J. Greene, Sr., authorized
representative.
A list of the Debtor's three largest unsecured creditors is
available for free at http://bankrupt.com/misc/txnb16-30087.pdf
GLENVILLE STATE: Moody's Lowers Rating on 2011A Bonds to B1
-----------------------------------------------------------
Moody's Investors Service has downgraded the rating on Glenville
State College's (GSC) 2011A lease-backed bonds to B1 with a
negative outlook from Ba2. The downgrade results from a
substantial deterioration in operating performance and liquidity,
with very limited remaining cash on hand. The downgrade also
reflects expectations of ongoing financial pressure resulting from
softening student demand, diminishing state funding, and a
relatively inflexible expense base. The B1 rating further
incorporates the university's high leverage, with a complex debt
structure, including the potential for debt acceleration. Debt
service on the 2011A bonds is subject to annual appropriation and
the lease agreement can be easily terminated. Given financial and
market challenges, the debt structure heightens the risk that the
college will be unable to make debt service payments.
The B1 rating favorably incorporates the role Glenville State plays
in meeting state educational and economic development policy
objectives in a relatively rural region of West Virginia (Aa1
negative) and oversight by the Higher Education Policy Commission
(HEPC). HEPC (Aa3 stable) has provided extraordinary support to
some other universities during periods of financial distress.
Rating Outlook
The outlook remains negative based on expectations of ongoing
operating volatility, potentially leading to further deterioration
in flexible reserves and weaker coverage of debt.
Factors that Could Lead to an Upgrade
Sustained improvement in student demand and operations
Significant growth in spendable cash and investments providing
stronger coverage to debt and operations
Factors that Could Lead to a Downgrade
Failure to balance operations and stabilize cash flow in FY 2016
and beyond
Any acceleration of bank debt or failure to make debt service
payments
Continued weakening in student demand and weaker occupancy of
housing
Disruption or material reductions in state funding
Legal Security
The 2011A bonds are secured by a limited pledge and payable from
lease rental payments made by GSC to the Glenville State Housing
Corporation. Payments are subject to annual appropriation by the
college, which can cancel the Lease Agreement by providing the
Corporation 30 days notice. In this case, the college has no
constitutional or statutory obligation to make payments following
the cancellation of this agreement. These bonds are effectively
subordinated to the privately placed bank debt which holds security
interests in various revenue streams. The bonds are additionally
secured by a deed of trust on the project, which has a lease term
of 99 years. There is no debt service reserve fund.
Use of Proceeds
Not applicable
Obligor Profile
Glenville State College is a small, regional public college located
in central West Virginia, between Charleston and Morgantown. The
college had fall 2015 enrollment of 1,251 full-time equivalent
students and FY 2015 operating revenue of $22 million.
Methodology
The principal methodology used in this rating was Global Higher
Education published in November 2015. An additional methodology
used in this rating was The Fundamentals of Credit Analysis for
Lease-Backed Municipal Obligations published in December 2011.
HANCOCK FABRICS: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Hancock Fabrics, Inc. 16-10296
One Fashion Way
Baldwyn, MS 38824
Hancock Fabrics, LLC 16-10297
Hancock Fabrics of MI, Inc. 16-10298
hancockfabrics.com, Inc. 16-10299
HF Enterprises, Inc. 16-10300
HF Merchandising, Inc. 16-10301
HF Resources, Inc. 16-10302
Type of Business: Fabric Retailers
Chapter 11 Petition Date: February 2, 2016
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Brendan Linehan Shannon
Debtors' Stephen H. Warren, Esq.
General Karen Rinehart, Esq.
Counsel: Michael S. Neumeister, Esq.
O'MELVENY & MYERS LLP
400 South Hope Street
Los Angeles, CA 90071-2899
Tel: (213) 430-6000
Fax: (213) 430-6407
Email: swarren@omm.com
krinehart@omm.com
mneumeister@omm.com
Debtors' Local Mark D. Collins, Esq.
Counsel: RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
920 North King Street
Wilmington, DE 19801
Tel: 302 651-7700
Fax: 302-651-7701
Email: collins@RLF.com
- and -
Brett Michael Haywood, Esq.
RICHARDS, LAYTON & FINGER, P.A.
920 North King Street
P.O. Box 551
Wilmington, DE 19899
Tel: 302-651-7700
Fax: 302-651-7701
Email: haywood@rlf.com
- and -
Michael Joseph Merchant, Esq.
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
P.O. Box 551
Wilmington, DE 19899
Tel: 302-651-7700
Fax: 302-651-7701
Email: merchant@rlf.com
Debtors' CLEAR THINKING GROUP LLC
Financial
Advisor:
Debtors' LINCOLN PARTNERS ADVISORS LLC
Investment
Banker:
Debtors' RETAIL CONSULTING SERVICES, INC.
Real Estate d/b/a REAL ESTATE ADVISORS
Advisors:
Debtors' KURTZMAN CARSON CONSULTANTS, LLC
Claims and
Noticing
Agent:
Total Assets: $151.4 million
Total Debts: $182.1 million
The petition was signed by Dennis Lyons, senior vice president and
chief administrative officer.
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Myletex International Trade $1,000,839
Kevin Nelson
27 8th Street
Passaic, NJ 07055
Coats and Clark Trade $939,057
Joh Laurie
3430 Torington Way Suite 301
Charlotte, NC 28277
Perfect Textiles Inc. Trade $455,922
Marc Moyal
69-81 Sellers Street
Kearney, NJ 07032
Springs Creative Products Group LLC Trade $688,955
Donna Richardson
300 Chatham Avenue Suite 100
Rock Hill, SC 29730
Averitt Express Expense $663,376
Walt Grey
1415 Neal Street
Coockeville, TN 38502
J&J Corporation Trade $654,234
Mandee Mantos
No. 403 Sang-Ho Bldg.
423 Jangan-Dong Dongoaemun-Gu
Seoul, 000
South Korea
Fabric Editions Inc. Trade $653,972
Scott Moore
700 Executive Center Drive
Suite 201
Greenville, SC 29615
PRYM Dritz Trade $559,315
Delores Faulkner
950 Brisack Road
Spartanburg, SC 29303
WRIGHT'S Trade $541,528
Lanae Lewis
26612 Network Place
Chicago, IL 60673-1266
Fairfield Processing Trade $476,450
Jordan Young
88 Rose Hill Avenue
Danbury, CT 06813-1157
Fiskars MFG Corp. Trade $414,201
Laurie Beimborn
2537 Daniels Street
Madison, WI 53718
Fabri-Quilt Trade $369,339
Tom Waris
901 East 14th Street
North Kansas City, MO 64116
World Dynasty Trade $361,104
Eric MA or Judy Chen
RM9B, Sichuang Plaza
No. 4 600 Lane, Tian Shan Rd
Shanghai, 20051
China
Sykel Trade $360,258
Howard Liebowitz
48 West 38th Street
Suite 600
New York, NY 10018
ACG Media Expense $350,704
Christi Ware
21311 Madrona Avenue
Suite 101
Torrance, CA 90503
UPS-577 Expense $342,376
Jason Dulaney
55 Glenlake Pkwy NE
Atlanta, GA 30328
Simplicity Pattern Co Trade $320,918
PAT Nilson
A Division of Wilton Brands
24485 Network Place
Chicago, IL 60673-1244
Surge Staffing LLC Expense $319,964
Simone Muehlenbruch
109 Desert Cover
Saltillo, MS 38866
McCall Patterns Trade $309,008
Liz Parker
615 McCall Road
Manhattan, KS 66502
Ningbo CNACC IMP&EXP Co. Ltd. Trade $220,582
PCP Group, LLC Trade $208,947
China National Arts&crafts IMP&EXP Trade $206,628
WARM Products Trade $202,362
Dyno Merchandise Corp Trade $202,176
Sulky of America Trade $201,637
Ottlite Technologies Inc. Trade $195,095
Santee Print Works Trade $189,357
Everything Mary LLC Trade $180,069
Jaftex Corp. Trade $177,635
Westrock RKT Company Expense $176,702
HANCOCK FABRICS: Files Voluntary Chapter 11 Bankruptcy Petition
---------------------------------------------------------------
Hancock Fabrics, Inc., a retailer in fabric, sewing and
accessories, on Feb. 2 disclosed that it and its wholly-owned
subsidiaries have filed voluntary petitions for reorganization
under chapter 11 of the U.S. Bankruptcy Code. The Company filed
the petitions in the United States Bankruptcy Court for the
District of Delaware. The Company believes that the restructuring
will allow it to become more competitive in today's retail market,
both in stores and online. The Company intends to use the filing
to reorganize its capital structure and gain access to liquidity,
reduce costs and liabilities, optimize its store operations and
locations to meet customer demands and create the most value for
stakeholders. The Company is considering all possible options for
maximizing stakeholder value, including the sale of the business as
a going concern in either a single transaction or a series of
transactions. It is also reviewing investment options with
existing stakeholders and third parties.
The Company has taken this necessary step to reorganize its
financial and operational structure to position itself for optimal
growth. As part of the restructuring process, the Company intends
to implement a comprehensive program to enhance its customer
experience by increasing the availability of associates, in-store
classes and training. The Company also intends to feature an
enhanced e-commerce presence. The Company will continue to offer
an interactive online community, a wide variety of unique
merchandise and quality customer service.
"We believe the restructuring is a positive step for the future of
the Company and we are committed to providing our customers quality
fabrics and crafting essentials, both online and in stores. We
value our relationships with our vendors and appreciate their
support throughout this process. We will continue to offer the
same unparalleled service for which the Company has been known
since its founding in 1957," said Steve Morgan, President and Chief
Executive Officer.
During the restructuring process, the Company plans to continue to
operate its business as usual and to fulfill customer orders and
pay vendors. The Company has filed with the Bankruptcy Court, and
anticipates receiving approval of, customary motions to allow the
Company to make certain necessary payments to employees and vendors
that will ensure continued operations through the restructuring and
beyond.
The Company currently operates more than 250 retail stores in 37
states and an Internet store at the website
http://www.hancockfabrics.com
Hancock Fabrics, Inc. is a specialty retailer committed to
nurturing creativity through a complete selection of fashion and
home decorating textiles, sewing accessories, needlecraft supplies
and sewing machines. The Baldwyn, Mississippi-based company is one
of the largest fabric retailers in the United States, operating 260
stores in 37 states as of October 31, 2015 and an internet store
under the domain name hancockfabrics.com.
HARRISON FAMILY: Case Summary & 3 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Harrison Family Business LLC
PO Box 310
Tilghman, MD 21671-0310
Case No.: 16-11103
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
District of Maryland (Baltimore)
Judge: Hon. Thomas J. Catliota
Debtor's Counsel: Michael E. Crowson, Esq.
THE LAW FIRM OF SHAW & CROWSON, P.A.
212 W. Main Street Suite 303
Salisbury, MD 21801
Email: michael@lawislocal.com
Total Assets: $9,614
Total Liabilities: $3.16 million
The petition was signed by Levin F. Harrison, IV, authorized
representative.
A list of the Debtor's three largest unsecured creditors is
available for free at http://bankrupt.com/misc/mdb16-11103.pdf
HEALTH DIAGNOSTIC: Stay Lifted to Allow Bank to Repossess
---------------------------------------------------------
U.S. Bankruptcy Judge Kevin R. Huennekens has lifted the automatic
stay to allow Bank of the West to exercise its rights under its
collateral, including repossessing and disposing of the
collateral.
The Debtors will pay Bank of the West as adequate protection
$13,000 per month from November 2015 to January 2016.
Prior to the Petition Date, on Sept. 23, 2014, Bank of the West and
the Debtors entered into an Installment Payment Contract - Security
Agreement and related agreements and documents by which, among
other things, the Debtors incurred payment obligations and granted
the Bank a security interest in certain personal property.
As of the Petition Date, the Debtors' monetary obligations to the
Bank totaled $2,310,589, plus accrued and unpaid interest,
reasonable attorneys' fees, and other costs and expenses incurred
by the Bank in enforcing its rights under the Security Agreement.
About Health Diagnostic
Health Diagnostic Laboratory, Inc., Central Medical Laboratory,
LLC, and Integrated Health Leaders, LLC, are health care businesses
based in Richmond, Virginia. HDL is a blood testing company.
Health Diagnostic Laboratory, Inc. (Bankr. E.D. Va. Case No.
15-32919) and affiliates Central Medical Laboratory, LLC (Bankr.
E.D. Va. Case No. 15-32920) and Integrated Health Leaders, LLC
(Bankr. E.D. Va. Case No. 15-32921) filed separate Chapter 11
bankruptcy petitions on June 7, 2015. The petitions were signed by
Martin McGahan, chief restructuring officer.
HDL disclosed $96,130,468 in assets and $108,328,110 in liabilities
as of the Chapter 11 filing.
Justin F. Paget, Esq., Tyler P. Brown, Esq., Jason W. Harbour,
Esq., and Henry P. (Toby) Long, III, Esq. at Hunton & Williams LLP
serve as the Debtors' bankruptcy counsel.
Alvarez & Marsal is the Debtors' financial advisor. Robert S.
Westermann, Esq., at Hirshler Fleisher, P.C., serve as the Debtors'
conflicts counsel. American Legal Claims Services, LLC, is the
Debtors' claims, noticing and balloting agent. Ettin Group, LLC,
will market and sell the miscellaneous equipment and other assets.
MTS Health Partners, L.P., serves as investment banker.
To assist them with their restructuring efforts and to help
maximize the value of their estates, the Debtors filed with the
Court an application seeking entry of an order authorizing the
Debtors to retain Alvarez & Marsal Healthcare Industry Group, LLC
("A&M") to provide the Debtors with a Chief Restructuring Officer
and certain additional personnel. Richard Arrowsmith is presently
the CRO.
The Office of the U.S. Trustee appointed seven creditors to the
official committee of unsecured creditors. The official committee
retained Cooley LLP as its counsel and Protiviti Inc. as its
financial advisor.
* * *
On Oct. 29, 2015, the Court entered an order extending until Jan.
4, 2016, the period during which the Debtors have the exclusive
right to propose a Chapter 11 plan, and until March 3, 2016, the
exclusive period to solicit acceptances of that plan.
On Nov. 5, 2015, the Court entered an order setting Dec. 22, 2015,
as the Bar Date for the filing of all proofs of claim.
On Jan. 4, 2016, the Debtors filed a proposed Plan of Liquidation
and Disclosure Statement. A hearing on the Disclosure Statement is
scheduled for Feb. 11, 2016.
HORSEHEAD HOLDING: Case Summary & 50 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Horsehead Holding Corp. 16-10287
4955 Steubenville Pike, Suite 405
Pittsburgh, PA 15205
Horsehead Corporation 16-10288
Horsehead Metal Products, LLC 16-10289
The International Metals Reclamation Company, LLC 16-10290
Zochem Inc. 16-10291
Type of Business: Zinc Industry
Chapter 11 Petition Date: February 2, 2016
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Christopher S. Sontchi
Debtors' James H.M. Sprayregen, P.C
Counsel: Patrick J. Nash Jr., P.C.
Ryan Preston Dahl, Esq.
KIRKLAND & ELLIS LLP
300 N. LaSalle
Chicago, IL 60654
Tel: (312) 862-2000
Fax: (312) 862-2200
Email: james.sprayregen@kirkland.com
patrick.nash@kirkland.com
ryan.dahl@kirkland.com
Debtors' Laura Davis Jones, Esq.
Local James E. O'Neill, Esq.
Bankruptcy Joseph M. Mulvihill, Esq.
Counsel: PACHULSKI STANG ZIEHL & JONES LLP
919 N. Market Street, 17th Floor
Wilmington, DE 19801
Tel: 302 652-4100
Fax: 302-652-4400
Email: ljones@pszjlaw.com
joneill@pszjlaw.com
jmulvihill@pszjlaw.com
Debtors' Timothy D. Boates
Financial RAS MANAGEMENT ADVISORS, LLC
Advisor: 1285 Sharps Cove Road
Gurley, AL 35748
Tel: (256) 776-4989
Fax: (256) 776-4990
Email: tboates@rasmanagement.com
Debtors' LAZARD MIDDLE MARKET LLC
Investment
Banker:
Debtors' EPIQ BANKRUPTCY SOLUTIONS, LLC
Notice and
Claims
Agent:
Debtors' AIRD & BERLIS LLP
Canadian
Counsel:
Total Assets: $1 billion
Total Liabilities: $544.6 million
The petition was signed by Robert D. Scherich, vice president and
chief financial officer.
List of Debtor's 50 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
U.S. Bank National Association 3.80% Unsecured $100,000,000
100 Wall Street, Suite 1600 Convertible
New York, New York 10005 Notes
Attn: Global Corporate
Trust Services
U.S. Bank National Association 9.00% Unsecured $40,000,000
100 Wall Street, Suite 1600 Notes
New York, New York 10005
Attn: Global Corporate
Trust Services
Banco Bilbao Vizcaya Loan $17,400,000
Argentaria, S.A.
Structured Trade Finance
Spain
Calle Vla De Los
Poblados, S/N-4th Floor
28033 Madrid (Spain)
Hudbay Marketing & Sales Inc. Trade Vendor $8,524,782
25 York Street
Suite 800
Toronto, ON M5J 2V5 Canada
CCM Community Development IV LLC Guaranty $7,330,292
c/o CEI Capital Management LLC
Two Portland Fish Pier
Suite 206
Portland, ME 04101
Banc of America CDE III, LLC Guaranty $6,880,000
Bank of America
Community Development Banking
Group
100 NOrth Tryon Street, 11th
Floor
Charlotte, North Carolina
28255
Tecnicas Reunidas, S.A. Settlement $5,783,968
Arapiles, 13, Floor 13 Agreement
28015 Madrid Espana
Mid-Continent Coal & Coke Co. Trade Vendor $1,907,366
20600 Chagrin Blvd.
Suite 850
Clevelad, OH 44122
Thompson Industrial Services, LLC Trade Vendor $1,140,365
104 N. Main
Sumpter, SC 29150
C.H. Robinson Worldwide Inc. Trade Vendor $898,088
14701 Charlson Road
Eden Prarie, MN 55347
Industrial Piping Inc. Trade Vendor $855,678
13504 South Point Blvd.
Suite M
Charlotte, NC 28273
Better Management Corp Trade Vendor $830,615
41738 Esterly Drive
Columbiana, OH 44408
Chemicals, Inc. Trade Vendor $622,587
270 Osborne Drive
Fairfield, OH 45014
Classic Industrial Services, Inc. Trade Vendor $594,638
456 Highlandia Drive
Baton Rouge, LA 70810
Norfolk Southern Railway Co. Trade Vendor $580,201
Three Commercial Place
Norfolk, VA 23510
CSX Transportation, Inc. Trade Vendor $552,405
500 Water Street, 15th Floor
Jacksonville, FL 32202
Clary Hood Inc. Trade Vendor $485,930
150 Conway Black Road
Spartanburg, SC 29307
Southern States Chemical Trade Vendor $466,717
118 E. 35th Street
Savannah, GA 31401
Hatch Associates Consulting, Inc. Trade Vendor $451,174
1600 West Carson Street
Gateway View Plaza, Suite 1
Pittsburgh, PA 15219
First Staffing 650 S. John Ben Trade Vendor $449,469
Shepperd
Parkway
Odessa, TX 79761
Societe Generale Contract $443,675
OPER/OTC/CMO/STL/ECD Counterparty
170 Place Henri Regnault
92400 Paris La Defense 6
FRA-France
Eldeco
5751 Augusta Road Trade Vendor $393,709
Greenville, SC 29605
Powers Coal & Coke Trade Vendor $328,420
4807 Rockside Rd. #240
Independence, OH 44131
Integrity Construction & Trade Vendor $326,931
Grading, LLC
1223 Montgomery Drive
Chesnee, SC 39323
Industry Services Co., Inc. Trade Vendor $314,347
9265 Rangeline Rd
Theodore, Al 36582
Topcor Augusta LLC Trade Vendor $297,078
3977 Goshen Industrial Blvd.
Augusta, GA 30906
Mayco Holdings Trade Vendor $285,923
1031 east 103rd Street
Chicago, IL 60628
Tencarva Machinery Co. Trade Vendor $272,063
1115 Pleasant Ridge Road
Greensboro, NC 27409
Page E.T.C. Inc. Trade Vendor $265,620
2758 Trombley Rd.
Weedsport, NY 13166
Caroplast, Inc. Trade Vendor $253,459
8912 Wilkinson Blvd.
Charlotte, NC 28214
G E Railcar Services Trade Vendor $251,075
c/o Wells Fargo Rail
One O'Hare Center
6250 River Road, Suite 500
Limpact International Ltd. Trade Vendor $238,352
569 D'Arcy Street
Cobourg, ON K9A 4K5 Canada
Eblen, Wilma J. Trade Vendor $233,577
Encotech (Carbon Ser. & Trade Vendor $223,812
Equipment Co.)
Tindall Corporation Trade Vendor $223,008
O.B.I. Lining Inc. Trade Vendor $221,187
SRE Inc. Trade Vendor $215,747
Envirosafe Services of Ohio, Inc. Trade Vendor $213,886
Gardner Denver Nash Trade Vendor $200,548
J.T. Thorpe & Son Trade Vendor $197,020
Press Rentals Trade Vendor $194,046
Water Dynamics Inc. Trade Vendor $188,434
Chemalloy Company Inc. Trade Vendor $180,625
Terra First, LLC Trade Vendor $176,000
Carmeuse Lime & Stone, Inc. Trade Vendor $172,382
Linde LLC Trade Vendor $166,746
F.S. Sperry Co. Inc. Trade Vendor $162,073
Motion Industries Trade Vendor $153,074
Rexel Trade Vendor $144,680
Spesia Ayers Re: Joel Adams Litigation Unliquidated
HORSEHEAD HOLDING: Files Voluntary Chapter 11 Bankruptcy Petition
-----------------------------------------------------------------
Horsehead Holding Corp. on Feb. 2 disclosed that it and certain of
its subsidiaries (collectively, the "Company") have filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware.
Jim Hensler, President and Chief Executive Officer of the Company,
said: "The actions we are announcing today represent an important
step that we believe will allow us to restructure the Company's
balance sheet for the long-term. Filing for Chapter 11 protection
is the best available option to preserve stakeholder value. We
intend to emerge with increased financial flexibility and a capital
structure that will enable us to invest in growing our business."
Lazard Middle Market LLC and RAS Management Advisors, LLC are
serving as financial advisors, and Kirkland & Ellis LLP and
Pachulski Stang Ziehl & Jones LLP are serving as legal counsel to
the Company. Akin Gump Strauss Hauer and Feld LLP and Moelis &
Company are serving as legal counsel and financial advisor,
respectively, to certain senior secured noteholders and proposed
debtor-in-possession lenders.
About Horsehead
Horsehead Holding Corp. is the parent company of Horsehead
Corporation, a U.S. producer of specialty zinc and zinc-based
products and a leading recycler of electric arc furnace dust; The
International Metals Reclamation Company, LLC ("INMETCO"), a
leading recycler of metals-bearing wastes and a leading processor
of nickel-cadmium (NiCd) batteries in North America; and Zochem
Inc., a zinc oxide producer located in Brampton, Ontario.
Horsehead, headquartered in Pittsburgh, Pa., has seven facilities
throughout the U.S. and Canada.
* * *
The Troubled Company Reporter, on Jan. 22, 2016, reported that
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Pittsburgh-based Horsehead Holding Corp. to 'SD'
from 'CCC'.
Concurrently, S&P affirmed the 'CCC' issue-level rating on the
company's senior secured notes. The recovery rating on the notes
remains '4', which continue to reflect S&P's expectation for
average (30%-50%; lower end of the range) recovery in the event of
a conventional default.
The TCR, on Jan. 1, 2016, reported that Standard & Poor's Ratings
Services said that it has downgraded Pittsburgh-based zinc producer
Horsehead Holding Corp. to 'CCC' from 'B-'. The outlook is
negative.
At the same time, S&P lowered its issue-level rating on the
company's senior secured notes to 'CCC' from 'B-'. The '4'
recovery rating on the debt is unchanged, indicating S&P's
expectation of average (30%-50%; lower half of the range) recovery
in the event of a payment default.
HUDBAY MINERALS: S&P Lowers CCR to 'B-', Outlook Negative
---------------------------------------------------------
Standard & Poor's Ratings Services said it lowered long-term
corporate credit and issue-level ratings on Toronto-based copper
producer HudBay Minerals Inc. to 'B-' from 'B'. The outlook is
negative.
The '3' recovery rating on HudBay's senior unsecured notes is
unchanged, and corresponds with a meaningful (50%-70%; the upper
half of the range) recovery in a default scenario and an
issue-level rating that is the same as the 'B-' long-term corporate
credit rating.
"The downgrade reflects our expectation that HudBay will generate
earnings and cash flow below our previous expectations over the
next two years, leading to higher leverage and weaker liquidity,"
said Standard & Poor's credit analyst Jarrett Bilous.
The reduction to S&P's estimates follows the sharp deterioration in
copper and zinc prices and revision to S&P's price assumptions over
this period. In addition, the company provided updated production
and cost guidance for 2016, which was below S&P's previous
expectations. S&P now expects the company's adjusted
debt-to-EBITDA ratio will remain above 5x for a sustained period,
which corresponds with S&P's previous downside trigger.
The company has four mines, including three in Manitoba (Lalor,
777, and Reed), and its recently developed Constancia mine in Peru.
S&P expects Constancia will contribute to the majority of the
company's copper production and earnings beyond this year. As
such, in S&P's view, unforeseen production disruptions would have a
significant impact on the company's profitability. In addition,
S&P expects HudBay's profitability will remain highly volatile,
given its high exposure to fluctuations in copper and zinc
prices--both of which have sharply declined in recent months.
The negative outlook primarily reflects the possibility of another
downgrade if S&P believes HudBay becomes dependent on improving
copper prices or other positive developments to meet its financial
commitments over the next 12 months.
S&P would expect to lower its ratings on the company if S&P
believes HudBay becomes dependent on improving copper prices or
other positive developments to meet its financial commitments. In
this scenario, S&P would expect the company to face difficulty
renegotiating its covenants in 2016, or generate liquidity that S&P
considers weak over the next 12 months. In S&P's view, this could
result from copper and zinc prices sustainably below S&P's current
price assumptions, higher-than-expected costs, or material
operating issues that negatively affect production.
S&P could revise the outlook to stable following improvement in its
estimate of the company's liquidity position over the next 12
months, which S&P assumes could require a sustained increase in
average copper prices above S&P's base-case assumptions alongside a
sustained improvement in HudBay's cash cost of production, and lead
to improving prospective core credit ratios.
HUNT HINGES: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Hunt Hinges, Inc.
600 W. Belt Line Rd
Dallas, TX 75146
Case No.: 16-30504
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Stacey G. Jernigan
Debtor's Counsel: Melissa S. Hayward, Esq.
FRANKLIN HAYWARD LLP
10501 N. Central Expry, Ste. 106
Dallas, TX 75231
Tel: 972-755-7104
Fax: 972-755-7114
Email: MHayward@franklinhayward.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by John Buttles, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
KINETIC CONCEPTS: S&P Assigns BB- Rating on $400MM 1st-Lien Notes
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' issue-level
ratings to Kinetic Concepts Inc.'s proposed issuance of $400
million of senior secured first-lien notes. KCI USA Inc. is a
co-issuer of the notes. S&P assigned a recovery rating of '1' to
these notes, reflecting its expectation for very high recovery (90%
to 100%) on these obligations in the event of a payment default.
S&P expects the company to use proceeds to refinance the $312
million of term loan E-2 (USD) and to cover associated fees. The
remaining proceeds will be available for general corporate
purposes.
S&P's 'B' corporate credit rating on Kinetic Concepts reflects
S&P's assessment of the company's business risk as fair and the
financial risk profile as highly leveraged. The outlook is
stable.
The assessment of a fair business risk profile reflects significant
product concentration (negative pressure wound therapy based 'VAC'
devices account for about 70% of revenues), pricing pressure within
its advanced wound therapeutics product categories following the
expiration of Kinetic's patent on negative pressure wound therapy,
and the company's limited geographic diversity with roughly 75% of
revenues derived in the Americas. S&P's business risk assessment
also incorporates the company's well-entrenched market position and
deep organizational experience with VAC devices (about 90% share),
attractive EBITDA margins (35%), and the company's wound dressing
products and Regenerative Medicine division which provide modest
diversification.
The highly leverage financial risk profile reflects adjusted debt
leverage above 5x. S&P estimates adjusted debt leverage of about
8.3x for 2015, improving to about 8.0x for 2016. Leverage could
improve further if the company proceeds with plans for an IPO.
RATINGS LIST
Kinetic Concepts Inc.
Corporate Credit Rating B/Stable/--
New Rating
Kinetic Concepts Inc.
KCI USA Inc.
Senior Secured First-Lien Notes BB-
Recovery Rating 1
LANDS' END: S&P Lowers CCR to 'B', Outlook Stable
-------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating to 'B' from 'B+' on Wisconsin-based apparel retailer Lands'
End Inc. The outlook is stable.
At the same time, S&P lowered the issue-level rating on the term
loan to 'B' from 'B+'. S&P also revised the recovery rating to '4'
from '3', indicating its expectation of average recovery on the low
end of the 30% to 50% range.
"The rating action reflects Lands' End Inc.'s performance that was
meaningfully below our expectations in recent quarters. We believe
ineffective merchandising, disadvantageous retail store positioning
(nearly all physical locations are within struggling retailer
Sears), and management's lack of ability to leverage the company's
infrastructure and expertise in the direct-to-consumer channel have
weakened the company's competitive position, and will remain key
issues that will weigh on company performance over the next 12 to
24 months," said credit analyst Andrew Bove. "In addition, we
expect the specialty apparel industry to remain very competitive on
price over this time frame as consumers continue to spend
cautiously on discretionary goods."
The stable outlook reflects S&P's view that, although it forecasts
weak operating trends over the next 12 months, S&P expects credit
metrics to remain in line with its current assessment of the
company's financial risk over that time frame. S&P also expects
liquidity to remain "adequate".
S&P could lower the ratings if sales and profit declines become
more severe than its base-case expectation. This could be the
result of additional merchandise missteps leading to further
traffic declines, along with increased competition from specialty
apparel, off-price, and e-commerce retailers further pressuring
profitability. Under this scenario, revenues would decrease in the
mid-single digits in fiscal 2016 and gross margin would contract by
50 basis points (bps) below S&P's base-case forecast, resulting in
negative free operating cash flow in fiscal 2016. At that time,
leverage would be in the low-to-mid 5.0x area and FFO/debt would be
in the low-10% area.
Although unlikely in the near-term, S&P could raise the ratings if
the company reverses negative operating trends faster than
expected, and is able to improve its merchandising, resulting in
increased customer traffic. Under this scenario, revenue growth in
2016 would be flat-to-slightly positive with direct segment and
same-store sales both being positive, and margins would expand by
an additional 50 bps over our base-case forecast. S&P would also
expect these positive operating trends would continue over the next
12 to 24 months. At that time, leverage would be in the high-3.0x
area, and FFO/debt would be in the high-teens range. S&P could
also raise the ratings if improved merchandise execution and
operating efficiency result in a more favorable assessment of the
company's business risk.
MACCO PROPERTIES: Bankr. Court Recommends Denial of Jury Trial Bid
------------------------------------------------------------------
Before the United States Bankruptcy Court for the Western District
of Oklahoma is defendant Superior Farm, LLC's Motion for a Jury
Trial before an Article III Court and for a Withdrawal of
Reference.
Farm contends that cause exists to withdraw the automatic reference
of the proceeding captioned MICHAEL E. DEEBA, TRUSTEE, Plaintiff,
v. SUPERIOR FARM, LLC, Defendant. COBBLESTONE APARTMENTS OF TULSA,
LLC; LARRY D. AND JEANETTE A. JAMISON FAMILY TRUST; AND JACKIE L.
HILL, JR., Intervenors, Adv. No. 12-1138-R, proceeding to the
Bankruptcy Court, arguing that the Bankruptcy Court does not have
statutory or constitutional authority to enter a final order on
Trustee's claims; that Farm is entitled to trial of common law
claims before an Article III Court; and that Farm is entitled to a
jury trial and does not consent to the bankruptcy court conducting
a jury trial.
In a Recommendation dated January 14, 2016, which is available at
http://is.gd/V539umfrom Leagle.com, U.S. Bankruptcy Judge Dana L.
Rasure recommended to the District Court that the Defendant's
motion for a jury trial before an Article III Court and for a
Withdrawal of reference be denied.
The bankruptcy case is IN RE: MACCO PROPERTIES, INC., Chapter 7, NV
BROOKS APARTMENTS, LLC, Chapter 7, Debtors. MICHAEL E. DEEBA,
TRUSTEE, Plaintiff, v. SUPERIOR FARM, LLC, Defendant. COBBLESTONE
APARTMENTS OF TULSA, LLC; LARRY D. AND JEANETTE A. JAMISON FAMILY
TRUST; AND JACKIE L. HILL, JR., Intervenors, Case Nos. 10-16682-R,
10-16503-R Jointly Administered (Bankr. W.D. Okla.).
Michael E. Deeba, Plaintiff, is represented by Lysbeth L George,
Esq. -- lysbeth.george@crowedunlevy.com -- Crowe & Dunlevy Braniff
Building, Judy Hamilton Morse, judy.morse@cowedunlevy.com -- Crowe
& Dunlevy, P.C.
Superior Farm, LLC, Defendant, is represented by Joyce W. Lindauer,
Esq. -- Joyce@joycelindauer.com, Haley L Simmoneau, Esq.
About Macco Properties
Oklahoma City, Oklahoma-based Macco Properties, Inc., is a
property management company that is the sole or controlling member
and/or manager of numerous multi-family residential rental units
in Oklahoma City, Oklahoma, Wichita, Kansas, and Dallas, Texas,
and several and commercial business properties in Oklahoma City,
Oklahoma, and Holbrook, Arizona.
Macco Properties filed for Chapter 11 bankruptcy protection
(Bankr. W.D. Okla. Case No. 10-16682) on Nov. 2, 2010. The Debtor
disclosed $50,823,581 in total assets, and $4,323,034 in total
liabilities.
Affiliated entities also sought bankruptcy protection: NV Brooks
Apartments, LLC (10-16503); JU Villa Del Mar Apartments, LLC, and
(10-16842); and SEP Riverpark Plaza, LLC (10-16832). SEP
Riverpark Plaza owns or controls The Riverpark Apartments, a
multi-family apartment complex located in Wichita, Kansas.
Receivership Services Corp., a division of the Martens Cos.,
serves as property manager for the six Wichita apartment complexes
caught up in the bankruptcy of Macco Properties of Oklahoma City.
On May 31, 2011, an Order was entered appointing Michael E. Deeba
as the Chapter 11 Trustee for Macco Properties. He is represented
by Christopher T. Stein, of counsel to the firm of Bellingham &
Loyd, P.C. Grubb & Ellis/Martens Commercial Group LLC acts as
the Chapter 11 Trustee's exclusive listing broker/realtor for
properties.
The Official Unsecured Creditors' Committee is represented by
Ruston C. Welch, Esq., at Welch Law Firm, P.C., in Oklahoma City.
In August 2013, the Bankruptcy Court signed off on an agreed order
dismissing the Chapter 11 cases of SEP Riverpark Plaza and JU
Villa Del Mar Apartments.
MACCO PROPERTIES: Court Denies Bid to Junk Suit vs. Superior Farm
-----------------------------------------------------------------
Before the United States Bankruptcy Court for the Western District
of Oklahoma is the Joint Motion for Dismissal with Prejudice and
Notice of Opportunity for Hearing filed jointly by
Plaintiff/Trustee Michael E. Deeba and Defendant Superior Farm,
LLC. An evidentiary hearing was held on November 13, 2015, after
which the Court took the matter under advisement.
In an Order dated January 14, 2016, which is available at
http://is.gd/8H7pkpfrom Leagle.com, Judge Dana L. Rasure of the
United States Bankruptcy Court for the Western District of Oklahoma
concludes that the agreement to dismiss the adversary proceeding is
not fair, equitable, or in the best interests of the estate.
Dismissal of the Claims would benefit only Farm and McGinnis, and
would unfairly prejudice unsecured and administrative expense
claimants, Judge Rasure held. Accordingly, the Joint Motion to
Dismiss is denied.
The case is IN RE: MACCO PROPERTIES, INC., Chapter 7, NV BROOKS
APARTMENTS, LLC, Chapter 7, Debtors. MICHAEL E. DEEBA, TRUSTEE,
Plaintiff, v. SUPERIOR FARM, LLC, Defendant. COBBLESTONE APARTMENTS
OF TULSA, LLC; LARRY D. AND JEANETTE A. JAMISON FAMILY TRUST; AND
JACKIE L. HILL, JR., Intervenors, Case Nos. 10-16682-R, 10-16503-R
Jointly Administered, Adv. No. 12-1138-R.
Michael E. Deeba, Plaintiff, is represented by Lysbeth L George,
Esq. -- lysbeth.george@crowedunlevy.com -- Crowe & Dunlevy Braniff
Building, Judy Hamilton Morse, judy.morse@cowedunlevy.com -- Crowe
& Dunlevy, P.C.
Superior Farm, LLC, Defendant, is represented by Joyce W. Lindauer,
Esq. -- Joyce@joycelindauer.com, Haley L Simmoneau, Esq.
About Macco Properties
Oklahoma City, Oklahoma-based Macco Properties, Inc., is a
property management company that is the sole or controlling member
and/or manager of numerous multi-family residential rental units
in Oklahoma City, Oklahoma, Wichita, Kansas, and Dallas, Texas,
and several and commercial business properties in Oklahoma City,
Oklahoma, and Holbrook, Arizona.
Macco Properties filed for Chapter 11 bankruptcy protection
(Bankr. W.D. Okla. Case No. 10-16682) on Nov. 2, 2010. The Debtor
disclosed $50,823,581 in total assets, and $4,323,034 in total
liabilities.
Affiliated entities also sought bankruptcy protection: NV Brooks
Apartments, LLC (10-16503); JU Villa Del Mar Apartments, LLC, and
(10-16842); and SEP Riverpark Plaza, LLC (10-16832). SEP
Riverpark Plaza owns or controls The Riverpark Apartments, a
multi-family apartment complex located in Wichita, Kansas.
Receivership Services Corp., a division of the Martens Cos.,
serves as property manager for the six Wichita apartment complexes
caught up in the bankruptcy of Macco Properties of Oklahoma City.
On May 31, 2011, an Order was entered appointing Michael E. Deeba
as the Chapter 11 Trustee for Macco Properties. He is represented
by Christopher T. Stein, of counsel to the firm of Bellingham &
Loyd, P.C. Grubb & Ellis/Martens Commercial Group LLC acts as
the Chapter 11 Trustee's exclusive listing broker/realtor for
properties.
The Official Unsecured Creditors' Committee is represented by
Ruston C. Welch, Esq., at Welch Law Firm, P.C., in Oklahoma City.
In August 2013, the Bankruptcy Court signed off on an agreed order
dismissing the Chapter 11 cases of SEP Riverpark Plaza and JU
Villa Del Mar Apartments.
MOLYCORP INC: Oaktree Rips Paul Hastings' $1M Bill in Probe
-----------------------------------------------------------
Jeff Montgomery at Bankruptcy Law360 reported that Oaktree Capital
Management LP on Jan. 25, 2016, objected to a nearly $1 million,
one-month fee request from Paul Hastings LLP attorneys representing
Molycorp Inc.'s unsecured creditors, saying most of the expense
arose from a "scorched earth" probe for an upcoming bankruptcy
trial targeting the private equity firm.
The complaint focused on a nearly $938,000 September billing by
Paul Hastings in connection with an investigation into alleged
loan-to-own allegations and other pre- and post-bankruptcy
financing activities by Oaktree and Molycorp's directors and
officers before Molycorp's $1.9 billion Chapter 11 case.
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 management members are located at its U.S.
corporate headquarters in Greenwood 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.
MT MOORE: Court Confirms Ch. 11 Plan
------------------------------------
In a Findings of Fact and Conclusions of Law dated January 14,
2015, which is available at http://is.gd/DX2SOofrom Leagle.com,
Judge Frederick P. Corbit of the United States Bankruptcy Court for
the Eastern District of Washington approved the Disclosure
Statement and confirmed the Plan of Reorganization.
Judge Corbit finds that the Plan contains no unusual
classifications of claims or interests. Similar claims are
classified together and are treated equally within each class. The
Plan provides for the same treatment for each claim or interest
within a particular class.
Class 2, a major secured lender of the Ventura County, California
property, voted for the Plan. One hundred percent of the unsecured
creditors in Class 5 voted for the Plan.
The case is In re: MT MOORE, L.L.C., Debtor, Case No.
15-01801-FPC11 (Bankr. E.D. Wash.).
MT Moore, LLC, Debtor, is represented by:
William L Hames, Esq.
HAMES, ANDERSON, WHITLOW & O'Leary, P.S.
PO Box 5498
Kennewick, WA 99336-0498
Phone: 509 586-7797
Fax: 509 586-3674
Email: billh@hawlaw.com
MT Moore, LLC, sought protection under Chapter 11 of the Bankruptcy
Code on May 19, 2015 (Bankr. E.D. Wash., Case No. 15-01801). The
Debtor's Counsel is William L Hames, Esq., at Hames, Anderson,
Whitlow & O'Leary, P.S., in Kennewick, Washington.
NEW GULF RESOURCES: Feb. 22 Set as General Claims Bar Date
----------------------------------------------------------
The Bankruptcy Court for the District of Delaware established Feb.
22, 2016, at 4:00 p.m., as the deadline for any individual or
entity to file proofs of claim against New Gulf Resources, LLC, and
its debtor affiliates.
The Court also set 4:00 p.m. on June 14, as governmental unit
bar date.
Proofs of claim must be submitted by the bar dates to:
New Gulf Resources, LLC Claims Processing Center
c/o Prime Clerk LLC
830 3rd Avenue, 3rd Floor
New York, NY 10022
In a separate filing, the Debtor filed global notes, methodology
and
specific disclosures regarding the Debtors' schedules of assets and
liabilities and statements of financial affairs. A copy of the
filing
is available for free at:
http://bankrupt.com/misc/NewGulfResources_155_Jan15SAL.pdf
About New Gulf Resources
New Gulf Resources, LLC, NGR Holding Company LLC, NGR Texas, LLC
and NGR Finance Corp. filed Chapter 11 bankruptcy petitions (Bankr.
D. Del. Proposed Lead Case No. 15-12566) on Dec. 17, 2015.
The petition was signed by Danni Morris as chief financial
officer.
Founded in 2011 and headquartered in Tulsa, Oklahoma, New Gulf is
an independent oil and natural gas company engaged in the
acquisition, development, exploration and production of oil and
natural gas properties, focused primarily in the East Texas Basin.
The Company currently employs 55 people.
The Debtors have engaged Baker Botts L.L.P., as bankruptcy counsel,
Young, Conaway, Stargatt & Taylor, LLP as co-counsel,
Barclays Capital Inc., as investment banker, Zolfo Cooper, LLC as
financial advisor, and Prime Clerk LLC as claims and notice agent.
Judge Brendan Linehan Shannon has been assigned the case.
NEW GULF: Seeks Approval of Restructuring Support Agreement
-----------------------------------------------------------
New Gulf Resources, LLC and its debtor affiliates ask the
Bankruptcy Court for authority to assume the Restructuring Support
Agreement, dated Dec. 17, 2015, by and among the Debtors and the
supporting holders of the senior secured notes. The Debtors also
seek to pay and reimburse fees and expenses, which include the
reasonable and documented fees and expenses of the Ad Hoc
Committee, including the fees of their legal counsel, financial
advisor, and petroleum engineering consultant.
In mid-2015, faced with a heavy debt burden, declining revenues and
a commodity price environment poised to remain depressed for a
sustained period of time, New Gulf, like so many other oil and gas
companies during this down-cycle, engaged restructuring advisors
and began to proactively explore strategic alternatives to improve
its capital structure. New Gulf marketed its assets, considered
potential sale transactions, evaluated new financing, explored a
debt exchange and other deleveraging measures, and considered
various bankruptcy-focused alternatives. As New Gulf evaluated its
options, commodity prices continued to worsen. So too did the
Company's liquidity position.
In addition to independently exploring strategic alternatives, New
Gulf engaged in discussions with the Ad Hoc Committee, who hold in
the aggregate approximately 72% of the Second Lien Notes and
approximately 22% of the Subordinated PIK Notes, regarding
available options to enhance liquidity, right-size the Debtors'
debt burden, navigate the down-cycle in the oil and gas industry,
and bridge to a recovery in commodity prices. On December 17,
2015, after weeks of extensive negotiations, the Debtors and the Ad
Hoc Committee entered into the RSA, which provides a path toward
confirmation of the Plan.
The transactions contemplated by the Plan and other Definitive
Documents would satisfy all of the Debtors' financial obligations,
and allow for the opportunity to emerge from chapter 11 promptly,
through the following principal terms:
* DIP Financing: $75 million of debtor-in-possession financing
to be provided by members of the Ad Hoc Committee, approximately
half of which will be used to repay in full the First Lien
Indebtedness, with the balance providing operational liquidity for
the duration of these cases.
* A Confirmable Plan: Subject to the Court's approval of the
Disclosure Statement, the RSA and a diligence contingency in the
Backstop Note Purchase Agreement, the Ad Hoc Committee—which
collectively holds approximately 72% of the Second Lien Notes—has
agreed to vote in favor the Plan. Moreover, all other creditors
impaired by the Plan (namely, the Subordinated PIK Noteholders) are
contractually subordinated to the Second Lien Notes and deeply out
of the money. Nevertheless, as part of the overall settlement
embodied in RSA and the Plan, the Second Lien Noteholders are
voluntarily forgoing their right to part of the distributions under
the Plan that they are otherwise entitled to receive so that the
Debtors can (i) unimpair (or minimally impair) allowed general
unsecured claims, such as the claims of suppliers and vendors, and
(ii) provide for a pro rata distribution to Subordinated PIK
Noteholders of a portion of the new equity of certain of the
Reorganized Debtors upon emergence.
* New First Lien Notes and Rights Offering: On the Effective
Date, certain of the Reorganized Debtors will issue New First Lien
Notes in the original aggregate principal amount equal to $135.25
million, which is the sum of:
-- $75 million, issued to the DIP Lenders in connection with
their surrender and exchange of the principal portion of
their DIP Loan Claims for New First Lien Notes;
-- $5.25 million, as consideration for the Debtors' right to
require the DIP Lenders to surrender all claims for payment
of principal of the DIP Loans for New First Lien Notes;
-- $50 million, which will be offered Pro Rata to all holders of
Allowed Second Lien Notes Claims through a Rights Offering
backstopped in full by the Ad Hoc Committee; and
-- $5 million, as consideration for the right of New Gulf to
call the commitments of the Backstop Parties under the
Backstop Agreement to purchase all of the Unsubscribed Notes.
The New First Lien Notes are convertible into New Equity Interests
(as defined in the Plan) in accordance with and subject to the
terms and conditions of the Backstop Agreement and the Plan. The
terms of the New First Lien Notes will minimize debt service
obligations by allowing the Debtors (at their option) to pay all
interest payments in-kind for up to 5 years.
* Exchange of Second Lien Notes: The holders of Allowed Second
Lien Notes Claims - whose Claims amount to approximately $365
million in aggregate principal amount outstanding, plus accrued and
unpaid interest, plus the Applicable Premium (as referred to in the
Second Lien Notes Indenture) in the amount of not less than $63
million—will receive 95% of the New Equity Interests upon
emergence, which amount will be reduced to 87.5% if the Class of
holders of Allowed Subordinated PIK Notes Claims accept the Plan,
in either case subject to the Dilution Events. In addition, the
holders of Allowed Second Lien Notes Claims have the right to
participate Pro Rata in the Rights Offering.
* Exchange of Subordinated PIK Notes: The holders of Allowed
Subordinated PIK Notes Claims - whose Claims amount to
approximately $162 million in aggregate principal amount
outstanding - will receive their pro rata share of approximately
12.5% of the New Equity Interests, but only if they vote to accept
the Plan, or 5% if they instead vote to reject the Plan. In either
case, their recovery is subject to the Dilution Events.
The RSA provides for a comprehensive delevering of the Company's
capital structure. Following this right-sizing of their balance
sheet, the Debtors will be well positioned to weather a prolonged
down-cycle, and capitalize on the eventual recovery.
Having extensively explored other alternatives, the Debtors
carefully determined that the transactions negotiated with the Ad
Hoc Committee presented the highest and best value available to the
Debtors and their stakeholders under the circumstances. Compared
to other alternatives, the RSA transactions provide New Gulf with
the opportunity to pursue a restructuring that is both
comprehensive and efficient. It is the Debtors' business judgment
that assumption of the RSA as early as possible in these chapter 11
cases will provide certainty for all parties in interest and a
foundation for a successful plan process.
About New Gulf Resources
New Gulf Resources, LLC, NGR Holding Company LLC, NGR Texas, LLC
and NGR Finance Corp. filed Chapter 11 bankruptcy petitions (Bankr.
D. Del. Proposed Lead Case No. 15-12566) on Dec. 17, 2015. The
petition was signed by Danni Morris as chief financial officer.
Founded in 2011 and headquartered in Tulsa, Oklahoma, New Gulf is
an independent oil and natural gas company engaged in the
acquisition, development, exploration and production of oil and
natural gas properties, focused primarily in the East Texas Basin.
The Debtors have engaged Baker Botts L.L.P., as bankruptcy counsel,
Young, Conaway, Stargatt & Taylor, LLP as co-counsel, Barclays
Capital Inc., as investment banker, Zolfo Cooper, LLC as financial
advisor, and Prime Clerk LLC as claims and notice agent. Judge
Brendan Linehan Shannon has been assigned the case.
NUO THERAPEUTICS: Feb. 5 Meeting Set to Form Creditors' Panel
-------------------------------------------------------------
Andy Vara, Acting United States Trustee of Region 3, will hold an
organizational meeting on Feb. 5, 2016, at 10:00 a.m. in the
bankruptcy case of Nuo Therapeutics, Inc.
The meeting will be held at:
Delaware State Bar Association
405 N. King St.
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
ONE SOURCE INDUSTRIAL: Trustee Taps F&P to Assist in Liquidation
----------------------------------------------------------------
Michael A. McConnel, Chapter 11 trustee for One Source Industrial
Holdings, LLC, et al., seeks authority from the U.S. Bankruptcy
Court for the Northern District of Texas to employ Forshey &
Prostok, LLP, as special counsel effective as of Dec. 15, 2015.
F&P will assist in the liquidation of the Debtors' remaining
assets, and will render these services, among other things:
(1) prepare, on behalf of the trustee, pleadings and other
documents pertaining to the liquidation of the Debtors' assets as
needed;
(2) advise the trustee and prepare responses as necessary to any
pleadings that may be filed and served in the Chapter 11 case
pertaining to the trustee's efforts to liquidate the Debtors'
remaining assets; and
(3) perform all other legal services on behalf of the trustee.
The hourly rates of F&P's personnel are:
Partners $500
Associates or Contract Attorneys $210 - $375
Paralegals $150 - $195
F&P currently holds $296,549 in its IOLTA trust account of which
$257,500 represents sale proceeds from the sale of Dynamic Rental
Systems, LLC, a wholly owned subsidiary of Holdings.
To the best of the trustee's knowledge, F&P holds no interest
adverse to the Debtors or their estates with respect to the matter
on which it is to be employed.
F&P submitted a declaration in support of the motion.
F&P can be reached at:
J. Robert Forshey, Esq.
Suzanne K. Rosen, Esq.
FORSHEY & PROSTOK LLP
777 main St, Suite 1290
Tel: (817) 877-8855
Fax: (817) 877-4151
E-mail: bforshey@forsheyprostok.com
srosen@forsheyprostok.com
About One Source Industrial
One Source Industrial Holdings, LLC, and One Source Industrial LLC
are both limited liability companies that are part of a corporate
family of affiliated companies.
One Source Industrial Holdings holds equipment utilized by various
related entities which provide rental equipment and industrial
services to businesses in the oil and gas, refining,
manufacturing, pipeline, shipping, and construction industries.
The types of equipment possessed by One Source include, e.g.,
hazardous material transportation vehicles, frac tanks, tank
trailers, barrel mix tank and vacuum tankers, air machines, and
waste and other industrial boxes and tanks. Industrial provides
executive management, accounting, and overhead services for
Holdings.
One Source Holdings sought Chapter 11 bankruptcy protection
(Bankr. N.D. Tex. Case No. 14-44996) in Ft. Worth, Texas, on Dec.
16, 2014. One Industrial sought Chapter 11 bankruptcy protection
(Bankr. N.D. Tex. Case No. 15-400038) on Jan. 4, 2015.
On Jan. 9, 2015, the Court approved the joint administration of
the Debtors' cases for procedural purposes only.
Holdings' case is assigned to Judge Russell F. Nelms.
The Debtors each estimated $10 million to $50 million in assets
and debt.
The Debtors are represented by J. Robert Forshey, Esq., and
Suzanne K. Rosen, Esq., at Forshey & Prostok, LLP, in Ft. Worth,
Texas.
Lynnette R. Warman of Culhane Meadows, PLLC, serves as counsel to
the Official Committee of Unsecured Creditors.
ORCAL GEOTHERMAL: Fitch Affirms 'BB' Rating on $165MM Sr. Notes
---------------------------------------------------------------
Fitch Ratings has affirmed OrCal Geothermal LLC's $165 million
senior notes ($43.3 million outstanding) due in 2020 at 'BB'. The
Rating Outlook remains Negative.
KEY RATING DRIVERS
The 'BB' rating reflects Fitch's expectation of stable operations
of OrCal's geothermal projects under long-term revenue contracts
with some exposure to index-based price risk. The rating considers
that stable resource production remains dependent on sponsor-funded
discretionary capital expenditures.
The Outlook remains Negative due to ongoing uncertainty that the
full benefit of recent efforts to improve plant capacity and
overall efficiency will come to fruition. Operational performance
below expectations could suggest financial performance over the
remaining debt term is more consistent with a lower rating.
Production Below Expectations - Supply Risk: Weaker
The absence of substitute fuel supply leaves OrCal exposed to the
risk of declining geothermal resource production. Production is
dependent on an active, sponsor-supported capital plan that is
funded at the sponsor's discretion. Although the sponsor
demonstrates a strong track record of funding capital expenditures,
annual production has generally trended down over the last five
years.
Diminished Price Risk - Revenue Risk: Midrange
At the beginning of 2016, 50% of OrCal's total capacity
transitioned to a power purchase agreement (PPA) with the Southern
California Public Power Authority (SCPPA). As a result, the
proportion of capacity tied to volatile energy pricing under the
Short Run Avoided Cost (SRAC) methodology has been reduced to
one-third. OrCal's entire capacity is contracted with PPA
expirations ranging from three to 11 years beyond debt maturity.
Stable Operating Cost Profile - Operation Risk: Midrange
OrCal has maintained a stable cost profile over the past few years,
excluding sponsor-funded capital expenditures. The operator is a
subsidiary of the project sponsor and has significant experience
operating geothermal assets.
Fully-amortizing Debt Structure - Debt Structure: Midrange
OrCal's fully amortizing debt faces no refinancing risk and
contains features typical of project finance structures, such as a
six-month debt service reserve.
Vulnerable Financial Coverage
Underperformance of the geothermal resource or continued weakness
in SRAC pricing could impair OrCal's ability to service debt
payments over the remaining five-year debt term. Under Fitch's
rating case, which assumes 2.5% annual declines in resource
production and SRAC energy pricing averaging approximately $30/MWh,
DSCRs average 1.14x with particularly weak coverage in the final
two years of repayment. OrCal may rely on its parent company to
absorb a portion of operating costs or draw on its debt service
reserve in the event that operational cash flow is not sufficient
to meet debt payments.
Peer Comparison
The geothermal assets within Coso Geothermal Holdings, LLC ('C')
have suffered substantially greater resource depletion than Orcal's
plants. CE Generation, LLC's (CE Gen, 'BB-'/Outlook Stable)
portfolio has a proportionally larger exposure to variable SRAC
price risk than Orcal, and its debt is structurally subordinate to
project-level indebtedness. Like OrCal, CE Gen relies on
non-obligatory financial support from its parent company.
RATING SENSITIVITIES
Negative - Production declines or low SRAC pricing in 2016
resulting in a Fitch-calculated DSCR below the 2016 rating case of
1.30x would trigger a downgrade.
Negative - A significant increase in operating costs or cessation
of sponsor support for operating expenses or capital expenditures
could lead to a downgrade.
Positive - Stable or improved production in 2016 and a
Fitch-calculated DSCR above the 2016 rating case of 1.30x could
trigger a return to a Stable Outlook.
SUMMARY OF CREDIT
After significant downtime to implement capex investments in 2014,
annual production in 2015 returned to the level seen in 2013. This
suggests some success in stemming production declines.
Nevertheless, the substantial capex investment to improve overall
system efficiency at the Heber 1 complex fell short of
expectations. Plant output averaged 36MW in 2014 and 2015, below
the sponsor expectation of 44MW, due to lower-than-expected
efficiency from the refurbished steam turbine.
The ongoing environment of low natural gas pricing dragged the
average Southern California Edison (SCE, 'A-'/Outlook Stable) SRAC
price down from $48/MWh in 2014 to just over $31/MWh in 2015, a 35%
decline. As a result, total revenue fell by 13% from year-ago
levels, despite OrCal's rebound in production. Operating expenses
declined modestly in the past year, as variable O&M normalized from
higher levels associated with the Heber 1 enhancements. Overall,
Fitch calculates that operational cash flow in 2015 reached
approximately $12.5 million, generating a Fitch calculated DSCR of
0.84x.
As it has done in the past OrCal's parent company, Ormat Nevada
(Ormat), stepped in to bolster operational cash flow. The plant
operator is a subsidiary of Ormat and, at Ormat's discretion, a
portion of 2015 operating expenses (estimated at $8 million) owed
by OrCal to the operator were not collected. This resulted in a
higher level of cash flow available to service the debt, and a
sponsor-calculated DSCR of 1.37x. The rating incorporates the
expectation that parent Ormat would continue its practice of
relieving OrCal of some level of operating expenses in order to
ensure that there is sufficient cash available to meet debt
payments. However, Fitch's DSCR calculation does not include the
benefit of sponsor support, and accounts for all expenses as
presented in OrCal's income statements.
Looking forward, the impact of continued low natural gas pricing
will moderate. The Heber 1 complex has satisfied its performance
testing requirement under the SCPPA contract, facilitating the
commencement of the PPA beginning in January 2016. The SCPPA
contract utilizes a fixed, escalating energy price that begins at a
significantly higher rate than current SRAC pricing. This leaves
one-third of OrCal's overall capacity exposed to SRAC pricing under
the PPA with SCE at the Heber 2 complex.
Under the base case, Fitch assumes that resource production
declines at the five-year historical rate of 1.9% per year while
expenses grow by an assumed inflationary rate of 2.5% per year.
SRAC pricing, based on Fitch's long-term assumption for gas prices,
averages $36.80/MWh through 2020. The resulting financial profile
demonstrates declining coverage over the remaining debt term with
an average DSCR of 1.34x and a minimum of 1.19x in the final year
of repayment (2020).
Under the rating case, Fitch assumes modestly steeper production
declines of 2.5% per year. The rating case does not assume any
additional stress on expenses beyond the 2.5% growth assumption in
the base case, in recognition of OrCal's proven ability to manage
costs historically. SRAC prices are based on Fitch's low natural
gas price deck, yielding an average price of $30.50/MWh through
2020. The resulting profile suggests a declining DSCR profile, due
to the compounding effect of increasing costs and declining
production. The DSCR averages 1.14x through 2020 with coverage
hovering around breakeven in 2019 and 2020.
OrCal is a special-purpose company that was created to acquire the
Heber 1 and Heber 2 geothermal power facilities (the Heber power
plants) located in Imperial County, CA. OrCal also owns the Gould
1 and Gould 2 plants, and the Heber South power plant, which became
operational in 2008. OrCal is jointly owned by a tax-equity
investor and Ormat Nevada Inc. Ormat Nevada is a subsidiary of
Ormat Technologies, Inc., a vertically integrated owner and
developer of geothermal and other recovered energy projects.
PBG PROPERTIES: Case Summary & 3 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: PBG Properties, LP
3106 Suzanne
Rowlett, TX 75088
Case No.: 16-30488
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Barbara J. Houser
Debtor's Counsel: Eric A. Liepins, Esq.
ERIC A. LIEPINS, P.C.
12770 Coit Rd., Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
Email: eric@ealpc.com
Total Assets: $1.80 million
Total Liabilities: $654,662
The petition was signed by Jerry Gossett, authorized representative
of general partner.
A list of the Debtor's three largest unsecured creditors is
available for free at http://bankrupt.com/misc/txnb16-30488.pdf
PEDRO LOPEZ MUNOZ: Court Rejects Bid for Ch. 11 Trustee Appointment
-------------------------------------------------------------------
United Surety & Indemnity Company moves the United States
Bankruptcy Court for the District of Puerto Rico to appoint a
Chapter 11 trustee for Pedro Lopez Munoz.
In an Opinion and Order dated January 15, 2016, which is available
at http://is.gd/qkl0eOfrom Leagle.com, Judge Edward A. Godoy of
the United States Bankruptcy Court for the District of Puerto Rico
denied USIC's request for appointment of a chapter 11 trustee.
The court is not persuaded by the several grounds raised by USIC.
They either were not material or do not rise to the level of
misconduct requiring the appointment of a chapter 11 trustee, Judge
Godoy held. In many instances, the debtor was able to provide an
acceptable explanation for his actions, Judge Godoy further held.
The case is IN RE: PEDRO LÓPEZ MUÑOZ, Chapter 11, Debtor, Case
No. 13-08171 EAG (Bankr. D.P.R.).
PEDRO LOPEZ MUNOZ, Debtor, represented by Carmen D. Conde-Torres,
Esq. -- condecarmen@microjuris.com -- C CONDE & ASSOCIATES, Luisa
S. Valle-Castro, Esq. -- ls.valle@condelaw.com -- C CONDE &
ASSOCIATES.
QUICKSILVER RESOURCES: Picks $245M BlueStone Bid for Oil Assets
---------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Tulsa,
Oklahoma-based BlueStone Natural Resources has submitted a top bid
of $245 million to purchase bankrupt oil and gas producer
Quicksilver Resources' assets, according to court documents filed
on Jan. 25, 2016, in Texas.
BlueStone, which must be approved by the bankruptcy court, was
picked by Quicksilver as the winning bidder after an auction that
lasted 19 hours and stretched over two days, according to court
papers. Quicksilver and 13 affiliates entered court protection in
March, listing $2.3 billion in liabilities, including roughly $1.1
billion in secured debt.
About Quicksilver Resources
Quicksilver Resources Inc. (OTCQB: KWKA) is an exploration and
production company engaged in the development and production of
long-lived natural gas and oil properties onshore North America.
Based in Fort Worth, Texas, the company claims to be a leader in
the development and production from unconventional reservoirs
including shale gas, and coal bed methane. Following more than 30
years of operating as a private company, Quicksilver became public
in 1999.
The Company has U.S. offices in Fort Worth, Texas; Glen Rose,
Texas; Steamboat Springs, Colorado; Craig, Colorado and Cut Bank,
Montana. The Company's Canadian subsidiary, Quicksilver Resources
Canada Inc. is headquartered in Calgary, Alberta.
On March 17, 2015, Quicksilver Resources Inc. and certain of its
affiliates filed voluntary petitions for relief under Chapter 11
of
title 11 of the United States Code in Delaware. The Debtors are
seeking joint administration under the main case, In re
Quicksilver
Resources Inc. Case No. 15-10585. Quicksilver's Canadian
subsidiaries were not included in the chapter 11 filing.
The Company's legal advisors are Akin Gump Strauss Hauer & Feld
LLP
in the U.S. and Bennett Jones in Canada. Richards Layton &
Finger,
P.A., is legal co-counsel in the Chapter 11 cases. Houlihan Lokey
Capital, Inc., is serving as financial advisor. Garden City Group
Inc. is the claims and noticing agent.
The Company's balance sheet at Dec. 31, 2014, showed $1.21 billion
in total assets, $2.35 billion in total liabilities and total
stockholders' deficit of $1.14 billion.
The U.S. Trustee for Region 3 appointed five creditors of
Quicksilver Resources Inc. to serve on the official committee of
unsecured creditors.
* * *
The Debtors have previously been given exclusive right to file a
bankruptcy plan through October 13, 2015. They are seeking a
further extension of the exclusive plan filing period through
Feb. 1, 2016.
QUICKSILVER RESOURCES: To Close BlueStone Sale by March 31
----------------------------------------------------------
Quicksilver Resources Inc. and its U.S. subsidiaries on January 22,
2016, entered into an Asset Purchase Agreement with BlueStone
Natural Resources II, LLC pursuant to which the Buyer agreed to
purchase substantially all of the Sellers' U.S. oil and gas assets
for a cash purchase price of $245.0 million.
The consummation of the transactions contemplated by the Purchase
Agreement is subject to customary closing conditions, and such
transactions are expected to close on or before March 31, 2016.
The Company expects that the shares of its existing common stock
will be cancelled in the Chapter 11 proceedings and will not
receive any recovery.
The purchase price is subject to adjustment as set forth in the
Purchase Agreement, including (i) adjustments that may result if
the Sellers are unable to obtain certain consents necessary to
transfer certain properties, contracts and leases included as part
of the Assets, (ii) adjustments relating to Assets affected by
casualty loss or condemnation or eminent domain proceedings between
the date of the Purchase Agreement and the closing of the
transactions contemplated by the Purchase Agreement, (iii)
adjustments relating to third parties' preferential purchase rights
affecting certain Assets that are exercised prior to the Closing
and (iv) adjustments on account of a "true up" procedure that
adjusts the purchase price downwards or upwards for certain
revenues and expenses, with revenues and expenses attributable to
periods prior to the effective time (which is defined in the
Purchase Agreement as the first date of the month in which the
Closing occurs) being allocated to Sellers, and revenues and
expenses attributable to periods at or after the effective time
being allocated to Buyer. The Sellers and the Buyer have made
customary representations, warranties and covenants in the Purchase
Agreement.
The Purchase Agreement requires the Buyer to make a deposit equal
to 20% of the purchase price (before giving effect to any
adjustments), which deposit shall be payable to the Sellers, as
liquidated damages, in the event that the Purchase Agreement is
terminated on account of the Buyer's breach thereof, and such
deposit (together with any net proceeds from the required unwinding
or termination of the In-the-Money Hedge Book (as defined in the
Purchase Agreement)) shall constitute the Sellers' sole and
exclusive remedy with respect to such breach by the Buyer.
The Purchase Agreement also provides for the establishment of an
escrow account into which the Sellers, within two business days
following the approval of the Purchase Agreement by the Delaware
Bankruptcy Court, shall be required to deposit a sum of
$15,000,000. The Escrow Amount shall serve as the Buyer's sole and
exclusive source of recovery for proven, actual damages incurred by
the Buyer on account of a breach of the Purchase Agreement by the
Sellers that results in termination of the Purchase Agreement;
provided, however, that in the event that the Sellers, in the
exercise of their fiduciary duties, terminate the Purchase
Agreement for the express purpose of entering, and do enter, into
an Alternate Transaction, or enter into an Alternate Transaction
without first seeking to terminate or terminating the Purchase
Agreement, such actions shall constitute a breach of the Purchase
Agreement and the Buyer's sole and exclusive remedy for its proven,
actual damages arising from such breach shall be limited to the
Escrow Amount and a Superpriority Administrative Expense Claim not
to exceed $24,500,000.
The Escrow Amount shall be returned to the Sellers in the event the
Closing occurs or, in any event, upon the date which is six months
following the date of the Purchase Agreement, except that any
portion of the Escrow Amount subject to claims for damages by the
Buyer in accordance with the terms of the Purchase Agreement that
are pending on such date shall be retained in escrow until such
claims are resolved.
Barnett Shale Gas LLC was approved by the Company as the backup
bidder. The terms of the bid of Barnett Shale, as backup bidder,
are described in the Sale Order.
The Sellers sought, and obtained, final approval of the
transactions contemplated by the Purchase Agreement from the
Bankruptcy Court pursuant to a sale order entered by the Bankruptcy
Court on January 27, 2016.
A copy of the Asset Purchase Agreement dated as of January 22, 2016
by and among Quicksilver Resources Inc., Cowtown Gas Processing,
L.P. and Cowtown Pipeline, L.P., as Sellers, and Bluestone Natural
Resources II, LLC, as Buyer, is available at
http://1.usa.gov/1nK1Dm5
BlueStone Natural Resources II, LLC is represented in the deal by:
CONNER & WINTERS, LLP
4000 One Williams Center
Tulsa, Oklahoma 74172
Attn: R. Kevin Redwine, Esq.
E-mail: kredwine@cwlaw.com
About BlueStone Natural Resources II, LLC
BlueStone Natural Resources II, LLC --
http://www.bluestone-nr.com-- represents the BlueStone team's
third partnership with Natural Gas Partners (NGP). Working
together for more than a dozen years, equity provider NGP provides
the BlueStone team with ready and reliable capital to facilitate
its continued growth through acquisition, drilling and asset
trades. The BlueStone team values its business relationships and
strives to be a committed, reliable partner as a participant in the
upstream oil and gas space.
About Natural Gas Partners
Founded in 1988, Natural Gas Partners (NGP) --
http://www.naturalgaspartners.com-- is a family of private equity
investment funds, with approximately $16.5 billion of cumulative
equity commitments, organized to make investments in the natural
resources sector. NGP is part of the investment platform of NGP
Energy Capital Management, a premier investment franchise in the
natural resources industry. In addition to NGP, NGP Energy Capital
Management's investment platform includes NGP Global Agribusiness
Partners, and NGP Energy Technology Partners.
About Quicksilver Resources
Quicksilver Resources Inc. (OTCQB: KWKA) is an exploration and
production company engaged in the development and production of
long-lived natural gas and oil properties onshore North America.
Based in Fort Worth, Texas, the company claims to be a leader in
the development and production from unconventional reservoirs
including shale gas, and coal bed methane. Following more than 30
years of operating as a private company, Quicksilver became public
in 1999.
The Company has U.S. offices in Fort Worth, Texas; Glen Rose,
Texas; Steamboat Springs, Colorado; Craig, Colorado and Cut Bank,
Montana. The Company's Canadian subsidiary, Quicksilver Resources
Canada Inc. is headquartered in Calgary, Alberta.
On March 17, 2015, Quicksilver Resources Inc. and certain of its
affiliates filed voluntary petitions for relief under Chapter 11 of
title 11 of the United States Code in Delaware. The Debtors are
seeking joint administration under the main case, In re Quicksilver
Resources Inc. Case No. 15-10585. Quicksilver's Canadian
subsidiaries were not included in the chapter 11 filing.
The Company's legal advisors are Akin Gump Strauss Hauer & Feld LLP
in the U.S. and Bennett Jones in Canada. Richards Layton & Finger,
P.A., is legal co-counsel in the Chapter 11 cases. Houlihan Lokey
Capital, Inc., is serving as financial advisor. Garden City Group
Inc. is the claims and noticing agent.
The Company's balance sheet at Dec. 31, 2014, showed $1.21 billion
in total assets, $2.35 billion in total liabilities and total
stockholders' deficit of $1.14 billion.
The U.S. Trustee for Region 3 appointed five creditors of
Quicksilver Resources Inc. to serve on the official committee of
unsecured creditors.
QUIKSILVER INC: Court Confirms Third Amended Ch. 11 Plan
--------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware on Jan. 29, 2016, issued a findings of fact,
conclusions of law and order confirming the Third Amended Joint
Chapter 11 Plan of Reorganization of Quiksilver, Inc., and its
debtor affiliates.
More than 60% of holders of Class 4 - Secured Notes Claims voted to
accept the Plan but only 23.61% of holders of Class 5A - Unsecured
Notes Claims voted to accept the Plan, according to a declaration
filed by Michael J. Hill, en employee of Kurtzman Carson
Consultants LLC. In addition, based on amount, but not numerosity,
holders of Class 5B - General Unsecured Claims at Debtor QS
Wholesale, Inc., voted to reject the Plan. A full-text copy of the
Tabulation Report is available at http://is.gd/z4Bi9c
The Debtors, prior to the Confirming Hearing, filed a memorandum of
law maintaining that the Plan represents the culmination of efforts
by the Debtors, the Plan Sponsor and their professionals and
advisors to restructure Quiksilver in a manner that maximizes value
for the Debtors' stakeholders, pursuant to which the Secured
Noteholders will conver their claims against Quiksilver into new
equity in Reorganized Quiksilver. In addition, a portion of the
equity will be distributed to the Secured and Unsecured Noteholders
who subscribed for the Rights Offerings, as well as the Plan
Sponsor, as Backstop Party. The Rights Offerings and Exit
Facilities will fund the distributions under the Plan, including
repayment of the DIP Facilities, payment of Administrative and
Priority Claims, and funding of additional cash consideration to
all unsecured creditors in the amount of $12.5 million, and will
also provide sufficient liquidity for the Reorganized Debtors
post-emergence operations. A full-text copy of the Memorandum is
available at http://is.gd/uA4iUj
The memorandum also addressed the seven formal objections to the
Plan and the several formal objections that were communicated to
the Debtors. Among those who filed formal objections to the Plan
were the Creditors' Committee and the U.S. Trustee.
The Committee complained that the Oaktree Plan, among other things,
(i) is premised upon an artificially low valuation of the Debtors'
estates, (ii) disguises the true consideration to be distributed to
Secured Noteholders on account of their claims and (iii) deprives
unsecured creditors of a fair recovery based on the value of the
Debtors' 35% equity interest in their foreign subsidiaries.
Andrew R. Vara, Acting U.S. Trustee for Region 3, complained that
the Plan's exculpation provision does not comply with applicable
case law, as it covers numerous entities who are not estate
fiduciaries in these cases. The only parties eligible for
exculpation in these cases are the Debtors, the Debtors' officers
and directors serving during the Chapter 11 cases in their capacity
as such, the Committee, and their respective attorneys, financial
advisors and other professionals, the U.S. Trustee said. All other
entities, including without limitation the Backstop Parties, the
Plan Sponsor, the DIP Lenders, the DIP Agents, the Secured Notes
Agent, as well as each entity's entourage of officers, directors,
affiliates, etc., as well as their respective
professionals, are not estate fiduciaries and should not be
exculpated, the U.S. Trustee argued. Those parties should instead
be stricken from the Plan's definition of Exculpated Parties, the
U.S. Trustee asserted.
Prior to the confirmation hearing, the Debtors revised the Second
Amended Plan to, among other things, incorporate comments from
parties-in-interest, incorporate the terms of a settlement with the
Official Committee of Unsecured Creditors, provide additional
information, clarify certain provisions and correct clerical and
typographical errors.
Specifically, the Third Amended Plan (i) amends the provisions
regarding exit financing to reflect the updated exit financing
structure, comprised of a $140 million Exit Revolver Facility and a
$50 million delayed-draw Exit Term Loan Facility, (ii) provides
that, upon the Effective Date, the Chapter 11 Cases of the Inactive
Debtors will be closed, (iii) contains certain non-substantive
corrections, and (iv) amends certain other provisions as
necessary.
A full-text copy of the Third Amended Plan is available at
http://bankrupt.com/misc/QSIplan0128.pdf
The Debtors also filed the Second Amended to the Plan Supplement to
the Third Amended Plan, a full-text copy of which is available at
http://is.gd/c7wEzW,the First Amendment to the Plan Supplement to
the Second Amended Plan, a full-text copy of which is available at
http://is.gd/ExUCw9and the Amendment to the Plan Supplement to the
Second Amended Plan, a full-text copy of which is available at
http://is.gd/ACFmJk
Stephen Coulombe, chief restructuring officier of Quiksilver, Inc.,
in a declaration, related that after careful review of the Debtors'
current and prospective business operations, and estimated
recoveries in liquidation scenarios, the Debtors concluded that
recovery to stakeholders will be maximized by the Debtors'
continuation as going concerns. The Debtors, Mr. Coulombe added,
believe that their businesses and assets have significant value
that would not be realized in a liquidation, either in whole or in
substantial part.
The Debtors are represented by:
Van C. Durrer, II, Esq.
Annie Z, Li, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
300 South Grand Avenue
Suite 3400
Los Angeles, CA 90071
Tel: (213) 687-5000
Fax: (213) 687-5600
-- and --
Mark S. Chehi, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
One Rodney Square
P.O. Box 636
Wilmington, DE 19899
Tel: (302) 651-3000
Fax: (302) 651-3001
-- and --
John K. Lyons, Esq.
Jessica S. Kumar, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 N. Wacker Dr.
Suite 2700
Chicago, IL 60606
Tel: (312) 407-0700
Fax: (312) 407-0411
The Creditors' Committee is represented by:
Michael S. Stamer, Esq.
Abid Qureshi, Esq.
Meredith A. Lahaie, Esq.
Joseph L. Sorkin, Esq.
Akin Gump Strauss Hauer & Feld LLP
One Bryant Park
New York, NY 10036
Tel: (212) 872-1000
Fax: (212) 872-1002
-- and --
David B. Stratton, Esq.
David M. Fournier, Esq.
John H. Schanne, II, Esq.
Pepper Hamilton LLP
Hercules Plaza, Suite 5100
1313 N. Market Street
Wilmington, DE 19899
Tel: (302) 777-6500
Fax: (302) 421-8390
The U.S. Trustee is represented by:
Mark S. Kenney, Esq.
Trial Attorney
Office of the United States Trustee
J. Caleb Boggs Federal Building
844 King Street, Suite 2207, Lockbox 35
Wilmington, DE 19801
Tel: (302) 573-6491
Fax: (302) 573-6497
Email: mark.kenney@usdoj.gov
About Quiksilver Inc.
Quiksilver, Inc., and its affiliates filed Chapter 11 bankruptcy
petitions (Bankr. D. Del., Case Nos. 15-11880 to 15-11890) on
Sept. 9, 2015. Andrew Bruenjes signed the petition as chief
financial officer. The Debtors disclosed total assets of $337
million and total debts of $826 million.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as the
Debtors' legal advisor, FTI Consulting, Inc. as their
restructuring advisor, and Peter J. Solomon Company as their
investment banker. Kurtzman Carson Consultants LLC acts as the
Debtors' claims and noticing agent.
The Debtors' First Amended Joint Chapter 11 Plan of Reorganization
provides that on the effective date, Reorganized Quiksilver will
issue new common stock to be distributed as follows: (a) first,
19% to holders of Allowed Secured Notes Claims; (b) second, up to
77% to Rights Offering Participants; and (c) third, 4% to the
Backstop Parties. As of the Effective Date, the anticipated value
of the New Quiksilver Common Stock will be approximately $276
million.
The U.S. trustee overseeing the Chapter 11 cases of Quiksilver
Inc. and its affiliates appointed seven members to the official
committee of unsecured creditors. The Committee tapped Akin Gump
Strauss Hauer & Feld LLP, and Pepper Hamilton LLP as its
co-counsel as co-counsel; Province Inc. as its financial advisor
and PJT Partners Inc. as investment banker.
RCS CAPITAL: Hires Prime Clerk as Claims and Noticing Agent
-----------------------------------------------------------
RCS Capital Corporation, et al., seek authority from the Bankruptcy
Court to employ Prime Clerk LLC as their claims and noticing agent,
nunc pro tunc to the Petition Date.
By appointing Prime Clerk as the Claims Agent, the Debtors expect
that the distribution of notices and the processing of claims will
be expedited, and the Office of the Clerk of the Bankruptcy Court
will be relieved of the administrative burden of processing
claims.
Prime Clerk's claims and noticing rates are:
Title Hourly Rate
----- -----------
Analyst $30-$45
Technology Consultant $65-$75
Consultant $80-$130
Senior Consultant $135-$150
Director $170-$190
Solicitation Consultant $190
Director of Solicitation $210
The Debtors request that the fees and expenses incurred by Prime
Clerk in the performance of the services be treated as
administrative expenses of their estates and be paid in the
ordinary course of business without further application to, or
order of, the Court.
Prior to the Petition Date, the Debtors provided Prime Clerk a
retainer of $50,000. Prime Clerk seeks to hold the Retainer during
the Debtors' cases as security for the payment of fees and expenses
incurred under the Engagement Agreement.
The Debtors have agreed to indemnify, defend and hold harmless
Prime Clerk and its members, officers, employees, representatives
and agents under certain circumstances specified in the Engagement
Agreement, except in circumstances resulting solely from Prime
Clerk's gross negligence or willful misconduct or as otherwise
provided in the Engagement Agreement or Retention Order.
Prime Clerk represents it is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code with respect
to the matters upon which it is engaged.
About RCS Capital
New York-based RCS Capital Corporation -- http://www.rcscapital.com
-- is a full-service investment firm focused on the individual
retail investor. With operating subsidiaries primarily focused on
retail advice and until the completion of recently announced
pending sales and divestiture of its wholesale distribution and
investment banking, the company's business aims to capitalize, grow
and maximize value for the investment programs its distributes and
the independent advisors and clients it serves.
RCS Capital Corporation and 11 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10223 to
16-10234) on Jan. 31, 2016. The petitions weres signed by David
Orlofsky as chief restructuring officer. The Debtors disclosed
total assets of $1.97 billion and total debts of $1.39 billion.
The Debtors have engaged Dechert LLP as general counsel, Young
Conaway Stargatt & Taylor, LLP as Delaware counsel, Zolfo Cooper
Management, LLC as restructuring advisor, Lazard Freres & Co. LLC
as investment banker and Prime Clerk LLC as administrative advisor
and claims and noticing agent.
RCS CAPITAL: Moody's Lowers Corporate Family Rating to 'Ca'
-----------------------------------------------------------
Moody's Investors Service has downgraded RCS Capital Corporation's
ratings, including its corporate family rating that was downgraded
to Ca from Caa3.
Moody's has taken these rating actions:
Corporate family rating, downgraded to Ca from Caa3
$575 million senior secured first lien term loan, downgraded to
Caa3 from Caa2
$25 million senior secured first lien revolving credit facility,
downgraded to Caa3 from Caa2
$150 million senior secured second lien term loan, downgraded to
C from Ca
Moody's said the downgrades were prompted by RCS' filing for relief
under Chapter 11 of the United States Bankruptcy Code and the terms
of its restructuring support agreement.
Moody's said it would withdraw RCS' ratings because it has entered
bankruptcy.
RATINGS RATIONALE
Moody's said the downgrades reflect an increase over Moody's
previously estimated expected losses for each tranche of RCS' rated
debt, based on the terms of RCS' restructuring support agreement
and the ongoing uncertainty over the future cash generating
capacity of RCS' independent financial advisory franchise.
Moody's said the C rating on RCS' second lien term loan reflects
its higher expected loss rate under the restructuring support
agreement.
Subsequent to the actions, Moody's will withdraw RCS' ratings
because it has filed for relief under Chapter 11 of the United
States Bankruptcy Code.
The principal methodology used in these ratings was Global
Securities Industry Methodology published in May 2013.
RCS CAPITAL: Seeks Joint Administration of Cases
------------------------------------------------
RCS Capital Corporation, et al., ask the Bankruptcy Court to enter
an order directing the joint administration of their Chapter 11
cases under the Lead Case No. 16-10223.
The Debtors also request that the Clerk of the Court maintain one
file and one docket for all of their Chapter 11 cases, which file
and docket will be the file and docket for Debtor RCS Capital
Corporation.
According to the Debtors, joint administration of their respective
estates is warranted and will ease the administrative burden on the
Court and all parties-in-interest. In addition, the Debtors
maintain, joint administration will permit the Clerk of the Court
to utilize a single docket for all of the Chapter 11 cases, and to
combine notices to creditors and other parties-in-interest in their
respective cases.
"Because there will likely be numerous motions, applications, and
other pleadings filed in these cases that will affect all of the
Debtors, joint administration will permit counsel for all parties
in interest to include all of the Debtors' cases in a single
caption for the numerous documents that are likely to be filed and
served in these cases," said Ian J. Bambrick, Esq., at Young
Conaway Stargatt & Taylor, LLP, counsel for the Debtors.
Mr. Bambrick added that joint administration will not prejudice or
adversely affect the rights of the Debtors' creditors because the
relief sought is purely procedural and is not intended to affect
substantive rights.
About RCS Capital
New York-based RCS Capital Corporation -- http://www.rcscapital.com
-- is a full-service investment firm focused on the individual
retail investor. With operating subsidiaries primarily focused on
retail advice and until the completion of recently announced
pending sales and divestiture of its wholesale distribution and
investment banking, the company's business aims to capitalize, grow
and maximize value for the investment programs its distributes and
the independent advisors and clients it serves.
RCS Capital Corporation and 11 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10223 to
16-10234) on Jan. 31, 2016. The petitions weres signed by David
Orlofsky as chief restructuring officer. The Debtors disclosed
total assets of $1.97 billion and total debts of $1.39 billion.
The Debtors have engaged Dechert LLP as general counsel, Young
Conaway Stargatt & Taylor, LLP as Delaware counsel, Zolfo Cooper
Management, LLC as restructuring advisor, Lazard Freres & Co. LLC
as investment banker and Prime Clerk LLC as administrative advisor
and claims and noticing agent.
REICHHOLD HOLDINGS: Chikamauga, Ferndale Properties Sale Okayed
---------------------------------------------------------------
Reichhold Holdings US, Inc., and its affiliated debtors sought and
obtained from Judge Mary F. Walrath approval for the sale of
certain real properties.
The Properties to be sold are located at 300 Hadgraft Industrial
Boulevard, Chickamauga, Georgia ("Chickamauga Property") and 601
Woodward Heights Boulevard, 701 Woodward Heights Boulevard, and all
residential properties related thereto, Ferndale, Michigan
("Ferndale Property").
The Debtors related that Ikeriu Land, LLC offered to purchase the
Chickamauga Property for $25,000 and that WHP Investments, Inc.
offered to purchase the Ferndale Property for $150,000. The Debtors
further related that they believe that selling the Properties to
the Purchasers through private sales is justified and appropriate.
The Debtors contended that the properties were actively marketed
for several months without receiving any offers for the Properties
other than those submitted by the Purchasers.
The Debtors told the Court that the Properties were part of the
nonresidential real properties that were excluded by Reichhold,
LLC, when it purchased substantially all of the Debtors' assets
("Surplus Assets"). The Debtors further told the Court that at the
time of the sale to Reichhold, LLC, the Surplus Properties were no
longer occupied or utilized for the Debtors' operations.
Reichhold Holdings US and its affiliated debtors are represented
by:
Norman L. Pernick, Esq.
Marion M. Quirk, Esq.
David W. Giattino, Esq.
COLE SCHOTZ P.C.
500 Delaware Avenue, Suite
Wilmington, DE 19801
Telephone: (302)652-3131
Facsimile: (302)652-3117
E-mail: npernick@coleschotz.com
mquirk@coleschotz.com
dgiattino@coleschotz.com
- and -
Gerald H. Gline, Esq.
Kenneth L. Baum, Esq.
COLE SCHOTZ P.C.
25 Main Street
Hackensack, NJ 07602-0800
Telephone: (201)489-3000
Facsimile: (201)489-1539
E-mail: ggline@coleschotz.com
kbaum@coleschotz.com
About Reichhold Holdings US
Founded in 1927, Reichhold, with its world headquarters and
technology center in Durham, North Carolina, is one of the world's
largest manufacturer of unsaturated polyester resins and a leading
supplier of coating resins for the industrial, transportation,
building and construction, marine, consumer and graphic arts
markets. Reichhold -- http://www.Reichhold.com/-- has
manufacturing operations throughout North America, Latin America,
the Middle East, Europe and Asia.
As of June 30, 2014, the Reichhold companies had consolidated
assets of $538 million and liabilities of $631 million.
Reichhold Holdings US, Inc., Reichhold, Inc., and two U.S.
affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case
No. 14-12237) on Sept. 30, 2014.
Cole, Schotz, Meisel, Forman & Leonard, P.A. (legal advisor) and
CDG Group LLC (financial advisor) are representing Reichhold, Inc.
Latham & Watkins LLP (legal advisor) and Moelis & Company
(investment banker) are serving Reichhold Industries, Inc.
Logan & Company is the company's claims and noticing agent.
The cases are assigned to Judge Mary F. Walrath.
The U.S. Trustee for Region 3 appointed seven creditors of
Reichhold Holdings US, Inc., to serve on the official committee of
unsecured creditors.
On April 2, 2015, Reichhold disclosed that the purchase of most of
the assets of the U.S. business was completed. This transaction,
approved by the Delaware Bankruptcy Court on January 12, 2015,
allows Reichhold's U.S. businesses to successfully emerge from
bankruptcy and re-join the rest of the global Reichhold
organization. Concurrent with this purchase, Reichhold completed
a
debt-for-equity exchange with a group of investors led by Black
Diamond Capital Management LLC and including J.P. Morgan
Investment
Management, Inc., Third Avenue Management LLC, and Simplon
Partners
LP.
On April 1, 2015, the U.S. Trustee named three non-union retirees
of Debtors to serve as the official Non-Union Retiree Committee.
Each of the Retiree Committee members is receiving retiree welfare
benefits from one or more of the Debtors. The Retiree Committee
tapped the law firm of Stahl Cowen Crowley Addis LLC as its
counsel.
RELATIVITY MEDIA: Bankruptcy Court Approves Plan of Reorganization
------------------------------------------------------------------
Relativity Media LLC on Feb. 2 disclosed that the United States
Bankruptcy Court for the Southern District of New York has approved
the Company's plan of reorganization clearing the way for
Relativity to emerge from Chapter 11 in short order. In confirming
the Plan, Judge Michael Wiles found that the Plan as described
satisfied the various requirements of the U.S. Bankruptcy Code and
said the Court will entertain an order confirming the Plan, with
required modifications, following a hearing held today.
"[Tues]day we achieved an important milestone in Relativity's path
to emerging from chapter 11 as a stronger, well-capitalized media
company that is well positioned for growth and success," said
Ryan Kavanaugh, Chairman and CEO, Relativity. "We sincerely
appreciate the support of our financial partners and creditors, as
well as the unrelenting dedication of our employees, which together
have allowed us to successfully complete this process. We have a
phenomenal management team in place, and we can't wait to create
Relativity's new future."
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, 2015, completed its purchase of the assets of Relativity
Television.
After selling their TV business, the Debtors and CEO Ryan C.
Kavanaughfiled a proposed plan of reorganization that will allow
the Debtors to reorganize their non-TV business units with a
substantially de-levered balance sheet utilizing new equity
investments and new financing.
Jim Cantelupe, of Summit Trail Advisors, LLC, has committed to work
with the Debtors to raise up to $100 million of new equity to fund
the Plan.
RELATIVITY MEDIA: Ends Manchester Dispute Ahead of Ch. 11 Hearing
-----------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Relativity
Media and its creditors said on Jan. 26, 2016, in New York
bankruptcy court that they have settled a dispute with major lender
Manchester Securities in a deal that clears the way for the
investment firm to assert a $137 million unsecured claim against
the Debtor's estate. The settlement averts potential litigation
between the parties and quell's Manchester's opposition to
Relativity's restructuring plan, attorneys said during a court
hearing in Manhattan.
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, 2015, completed its purchase of the assets of Relativity
Television.
After selling their TV business, the Debtors and CEO Ryan C.
Kavanaughfiled a proposed plan of reorganization that will allow
the Debtors to reorganize their non-TV business units with a
substantially de-levered balance sheet utilizing new equity
investments and new financing. Jim Cantelupe, of Summit Trail
Advisors, LLC, has committed to work with the Debtors to raise up
to $100 million of new equity to fund the Plan.
RYAN LLC: Moody's Affirms B3 CFR & Lowers Outlook to Negative
-------------------------------------------------------------
Moody's Investors Service has lowered Ryan, LLC's outlook to
negative from stable reflecting concerns surrounding covenant
compliance and uncertainty in the company's working capital
profile. Ryan's Corporate Family Rating has been affirmed at B3,
as has its Probability of Default rating of Caa1-PD and senior
secured credit facilities rating of B2.
According to Moody's analyst David Berge, "Ryan's financial
covenant cushion is much tighter than expected when we assigned
ratings in July 2015, which raises questions about whether the
company can restore robust room under these covenants as they step
down through 2016."
Outlook Actions:
Issuer: Ryan, LLC
Outlook, Changed To Negative From Stable
Affirmations:
Issuer: Ryan, LLC
Probability of Default Rating, Affirmed Caa1-PD
Corporate Family Rating, Affirmed B3
Senior Secured Bank Credit Facility, Affirmed B2 (LGD2)
RATINGS RATIONALE
Ryan's rating outlook was changed to negative primarily to reflect
emerging concerns about liquidity due to inadequate room under
financial covenants along with unexpectedly-high drawings under the
revolver to cover working capital needs in the second half of 2015.
Due to the lack of predictability in revenue stream and receivable
collections inherent in Ryan's business model, Moody's believes
that the recent deterioration in liquidity poses additional risk in
the company's credit profile. However, Ryan's ratings are
supported by manageable debt levels that result in credit metrics
that remain strong relative to the rating, as well as by the
company's strong market position in the specialty tax service
industry in the US, as well as its strong and diverse customer
base.
Liquidity, working capital management, and financial performance in
the second half of 2015 have lagged expectations, while the company
has been highly reliant on the use of its revolver to cover
operating needs. In particular, Ryan had only minimal cushion to
prescribed leverage covenants as of September 2015, which is
expected to remain tight through 2016, especially as covenant
limits step down. While the company estimates that it will have
comfortable cushion to the year-end 2016 covenant limits, Moody's
believes that this will nonetheless require a substantial
improvement in earnings over a short period in order to restore
covenant cushions to levels that would better support the B3
rating. Moody's notes that the company is undertaking a number of
cost reduction and business restructuring changes that, along with
the absence of certain non-recurring events in 2015, improves
prospects for earnings improvement in 2016. However, until the
company can demonstrate more robust covenant cushion multiple
quarters, tightness to covenants will remain a constraining factor
on the rating and its outlook.
The ratings could be lowered if the company cannot demonstrate a
covenant cushion of at least 15% by the end of 2016 that can also
be sustained over the longer term as leverage covenants step down
further. Any other deterioration in liquidity, such as sustained
negative free cash flow generation or increased borrowings under
the revolver, could also result in lower rating consideration. The
rating could also be downgraded if revenue or margins lag
management's expectations through 2016, or if the company
encounters material difficulty in integrating acquisitions.
Acceleration in debt-financed acquisitions, or the undertaking of
an aggressive shareholder return policy could also warrant a
downgrade.
While a ratings upgrade is unlikely, higher ratings consideration
could be considered if the company were to experience strong
revenue growth and stability over a wider geographic range, while
maintaining operating margins and significantly improving
liquidity. The company would need to demonstrate successful
integration of acquired businesses over this period, with a
commitment to reduce debt through use of free cash flow. Sustained
robust cash reserves along with a restoration of essentially full
availability to the revolver would be important for higher rating
consideration.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in December 2014.
Ryan, LLC, headquartered in Dallas, TX, is a provider of tax
services across North America, Europe, Asia, Australia and Latin
America, with its largest tax practice located in the United
States. Ryan generated sales for the twelve months ended Sept. 30,
2015, of approximately $410 million.
RYCKMAN CREEK: Case Summary & 30 Largest Unsecured Creditors
------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Ryckman Creek Resources, LLC 16-10292
aka URC Canyon Creek
aka NGPL Canyon Compression Company
aka EPWP Resources Company
aka Ryckman Creek Gas Storage LLC
Ryckman Creek Resources, LLC
3 Riverway, Suite 1100
Houston, TX 77056
Ryckman Creek Resources Holdings LLC 16-10293
Peregrine Rocky Mountains LLC 16-10294
Peregrine Midstream Partners LLC 16-10295
Type of Business: Engaged in the acquisition, development,
marketing, and operation of an underground
natural gas storage facility
Chapter 11 Petition Date: February 2, 2016
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Kevin J. Carey
Debtors' Counsel: Jessica S. Kumar, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 North Wacker Drive
Chicago, IL 60606-1720
Tel: 312-407-0700
Fax: 312-407-0411
Email: jessica.kumar@skadden.com
- and -
George N Panagakis, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 N. Wacker Drive, Suite 2800
Chicago, IL
Tel: (312) 407-0700
Email: George.Panagakis@skadden.com
- and -
Sarah E. Pierce, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
One Rodney Square
P.O. Box 636
Wilmington, DE 19899
Tel: 302-651-3127
Fax: 302-329-9416
Email: sarah.pierce@skadden.com
- and -
Justin M. Winerman, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 N. Wacker Drive
Chicago, IL
Email: justin.winerman@skadden.com
Debtors' AP SERVICES, LLC
Management
Provider:
Debtors' EVERCORE GROUP LLC
Investment
Banker:
Debtors' KURTZMAN CARSON CONSULTANTS LLC
Claims and
Noticing
Agent:
Estimated Assets: $100 million to $500 million
Estimated Debts: $100 million to $500 million
The petition was signed by Robert Foss, chief executive officer.
List of Debtor's 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
ING Capital LLC Bank Loans Undetermined
Administrative Agent for
lenders under Second Amended
and Restated Credit Agreement
1325 Avenue of the Americas,
11th Floor
New York, NY 10019
Troy Construction, LLC Litigation $19,799,129
8521 McHard, Rd
Houston, TX 77053
Matrix Service, Inc. Trade $6,480,672
3810 Bakerview Spur
Bellingham, WA
98226
William Insulation Company Trade $5,529,123
PO Box 2259 Mills
WY 82644
Redi Services, LLC Trade $4,842,115
West End Owen St.
Lyman, WY 82937
Brock Services, LLC Trade $4,171,119
6435 Huron Street|
Denver, CO 80221
International Alliance Group Trade $3,927,765
3657 Briarpark Drive
Houston, TX 77042
BCCK Engineering, Inc. Trade $1,867,232
2500 North Big Spring
Suite 230 Midland
TX 79705
Acqyre B.V. Trade $1,858,564
PO Box 85571 2508 CG
The Hague
The Netherlands
GSL-Great Salt Lake Electric Inc. Trade $1,826,202
8540 Sandy Pkwy
Sandy, UT 84070
CB&I, Inc. Trade $1,789,388
205 Louis Hurley Road El Dorado
AR 71730
Andrews Kurth LLP Professional $1,444,394
600 Travis, Suite 4200 Services
Houston, TX 77002
MMR Constructors, Inc. Trade $1,417,953
14250 E. Easter Place Unit B
Centennial CO 80112
Emerson Process Management Trade $1,109,033
1100 W. Louis Henna Bldg. 1
Round Rock
Texas 78612
Wholesale Electric Supply Co. Trade $944,626
4040 Gulf Freeway Houston,
TX 77004
Intermountain Electric Service, Inc. Trade $655,010
PO Box 1848, Evenston, WY 82931
Black & Veatch Trade $515,369
PO Box 803823 Kansas City
MO 64180
Veritas Advisory Group Professional $375,003
1601 Elm Street Suite 3600 Services
Dallas, TX 75201
Enerflex Ltd. Trade $316,373
2289 Renauna Ave.
Casper, WY 82605
One-Chem, LLC Trade $293,744
PO Box 42
Randolph, UT 84064
Cicerone & Associates Trade $235,240
1302 Waugh Drive
Suite 248 Houston TX
77019
Elkhorn Construction, Inc. Trade $189,987
MMI Engineering Trade $178,048
Precision Systems Engineering Trade $147,577
Team Industrial Services, Inc. Trade $125,200
VirtueCom LLC Utilities $107,476
Flare Construction Inc. Trade $100,323
Dew Point Control, LLC Trade $99,225
Strategic Contract Resources, LLC Trade $87,360
Glenntech, Inc. Trade $61,640
SA CAMINO BANDERA: Case Summary & 4 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: SA Camino Bandera, LLC
19306 Terra Brook
San Antonio, TX 78255
Case No.: 16-50283
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Western District of Texas (San Antonio)
Judge: Hon. Craig A. Gargotta
Debtor's Counsel: Ronald J. Smeberg, Esq.
THE SMEBERG LAW FIRM, PLLC
2010 W Kings Hwy
San Antonio, TX 78201-4926
Tel: 210-695-6684
Fax: 210-598-7357
Email: ron@smeberg.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dany Lara, member.
A list of the Debtor's four largest unsecured creditors is
available for free at http://bankrupt.com/misc/txwb16-50283.pdf
SABINE OIL: Files Chapter 11 Plan to Restructure $2.9-Bil. Debt
---------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Sabine Oil &
Gas Corp. submitted a Chapter 11 plan on Jan. 26, 2016, in New York
federal court and asked the court for permission to begin
soliciting creditors on the gas and oil producer's plan to
restructure $2.9 billion in debt.
Sabine submitted its plan and a disclosure statement that's
intended to give the Debtor's financial stakeholders a clear idea
of how the company intends to restructure itself. The company
filed for bankruptcy in July, blaming its significant debt on a
dramatic plunge in oil prices.
About Sabine Oil & Gas Corporation
Sabine Oil & Gas Corp. is an independent energy company engaged in
the acquisition, production, exploration, and development of
onshore oil and natural gas properties in the U.S. The Company's
current operations are principally located in the Cotton Valley
Sand and Haynesville Shale in East Texas, the Eagle Ford Shale in
South Texas, the Granite Wash in the Texas Panhandle, and the
North Louisiana Haynesville. The Company operates, or has joint
working interests in, approximately 2,100 oil and gas production
sites (approximately 1,800 operating and approximately 315
non-operating) and has approximately 165 full-time employees.
Sabine Oil and its affiliated entities sought Chapter 11
Protection (Bankr. S.D.N.Y. Lead Case No. 15-11835) in Manhattan
on
July 15, 2015.
The Debtors have engaged Kirkland & Ellis LLP and Kirkland & Ellis
International LLP, as counsel; Lazard Freres & Co. LLC, as
investment banker and Prime Clerk LLC as notice, claims and
balloting agent. The Debtors also tapped Zolfo Cooper Management,
LLC, to provide Jonathan A. Mitchell as CRO and other additional
personnel.
The U.S. Trustee for Region 2 appointed five creditors to serve on
the official committee of unsecured creditors. The Committee
tapped Mark R. Somerstein, Esq., Keith H. Wofford, Esq.,
and D. Ross Martin, Esq., at Ropes & Gray LLP as counsel. The
Committee also retained Blackstone Advisory Partners L.P. as
investment banker; and Berkeley Research Group, LLC as financial
advisor.
SAGE PRODUCTS: Moody's Puts B2 CFR Under Review for Upgrade
-----------------------------------------------------------
Moody's Investors Service placed the ratings of Sage Products
Holdings III, LLC under review for upgrade, including the company's
B2 Corporate Family Rating and B2-PD Probability of Default Rating.
This action follows the announcement that Stryker Corporation (A3
on review for downgrade) has entered into a definitive agreement to
acquire Sage Products, LLC in an all-cash deal valued at
approximately $2.8 billion.
The transaction is expected to close during the second quarter of
2016, subject to regulatory review and customary closing
conditions. Moody's expects the company's outstanding bank debt to
be repaid in full and to withdraw all ratings at the close of the
transaction.
These ratings were placed under review for upgrade:
Sage Products Holdings III, LLC
Corporate Family Rating, B2
Probability of Default Rating, B2-PD
Senior secured first lien bank credit facilities, B1 (LGD3)
Senior secured second lien bank credit facilities, Caa1 (LGD5)
RATINGS RATIONALE
The review for upgrade is based upon Moody's view that, should the
acquisition by Stryker Corporation be consummated, that Sage will
become part of an enterprise with a stronger overall credit profile
than if Sage remains a standalone entity.
Excluding the contemplated acquisition by Stryker, Sage's B2
Corporate Family Rating is constrained primarily by the company's
small size and limited product, geographic and customer diversity.
The rating also reflects high financial leverage although Moody's
expects leverage to continue to decline in the next twelve months
due to EBITDA growth and debt pay down. Sage has demonstrated its
ability and willingness to bring leverage down in the past. While
Sage has a good track record of product growth and innovation,
hospital customers' desire to reduce costs and entry of lower-cost
competition will lead to pricing pressure or product substitution.
The rating also incorporates regulatory risk associated with Sage's
products and manufacturing process, which are subject to government
scrutiny including the FDA.
The rating is supported by Sage's leadership in its niche markets
focused on preventing hospital acquired conditions (HACs). Moody's
believes Sage will benefit from increased regulatory emphasis on
the prevention of HACs, which will increase demand for the
company's products. The rating also reflects our expectation that
Sage will maintain strong profit margins, generate consistent
positive free cash flow, and maintain a good liquidity profile.
The principal methodology used in these ratings was Global Medical
Product and Device Industry published in October 2012.
Sage Products Holdings III, LLC, headquartered in Cary, IL,
manufactures disposable medical supplies that are used to prevent
hospital acquired conditions, including ventilator-associated
pneumonia (VAP), surgical site infections (SSI), and
catheter-associated urinary tract infections (CAUTI). The company
sells its disposable products primarily to US hospitals and long
term care facilities. Sage has been privately held by Madison
Dearborn Partners since 2012. For the twelve months ended Dec. 31,
2015, Sage generated sales of approximately $430 million.
SAGE PRODUCTS: S&P Puts 'B' CCR on CreditWatch Positive
-------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B' corporate credit
rating and issue-level ratings on Sage Products Holdings III LLC on
CreditWatch with positive implications. The CreditWatch placement
follows Stryker Corp.'s announced plans to acquire Sage.
Sage, a leader in hospital-acquired infection prevention products
is being acquired by medical technology company Stryker Corp. in an
all-cash transaction valued at about $2.8 billion.
S&P placed its ratings on Stryker on CreditWatch with negative
implications. S&P expects to resolve that CreditWatch upon
consummation of this transaction.
S&P will likely resolve the CreditWatch placement and raise the
rating once the transaction is closed in the second quarter of 2016
and Sage's debt is redeemed, concurrent with the resolution of our
CreditWatch placement on Stryker Corp.
S&P will subsequently withdraw the corporate rating and issue-level
ratings on Sage following the close of the transaction. S&P
expects the Sage debt will be refinanced at transaction close.
SAMSON RESOURCES: Has Access to Cash Collateral Until Feb. 29
-------------------------------------------------------------
As of Jan. 26, 2016, Judge Christopher S. Sontchi has entered five
interim orders authorizing Samson Resources Corporation, et al.'s
use of cash collateral. As agreed by the Debtors, the agents for
the Debtors' first and second lien credit facilities, and the
official committee of unsecured creditors, the judge entered the
fifth cash collateral order, which extends the termination date of
the Debtors' access to cash collateral until Feb. 29, 2016.
The final hearing on the Debtors' motion to use cash collateral is
scheduled for Feb. 22, 2016, at 10:00 a.m. Objections to the
Debtors' continued use of cash collateral are due Feb. 15.
A copy of the Fifth Interim Cash Collateral Order is available for
free at:
http://bankrupt.com/misc/Samson_R_610_5th_Int_Cash_Ord.pdf
Samson Resources owes its lenders more than $1.9 billion as of
Sept. 16, 2015. JPMorgan Chase Bank N.A. and Deutsche Bank Trust
Company Americas serve as administrative agents for the lenders,
court filings show.
About Samson Resources
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (D. Del. Lead Case No. 15-11934) on Sept. 16, 2015.
Philip W. Cook signed the petition as executive vice president and
chief financial officer. The Debtors estimated assets and
liabilities of more than $1 billion.
Samson is an onshore oil and gas exploration and production
company
with interests in various oil and gas leases primarily located in
Colorado, Louisiana, North Dakota, Oklahoma, Texas, and Wyoming.
The Operating Companies operate, or have royalty or working
interests in, approximately 8,700 oil and gas production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Kirkland & Ellis LLP represents the Debtors as general counsel.
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' investment
banker. Garden City Group, LLC serves as claims and noticing agent
to the Debtors.
Andrew Vara, acting U.S. trustee for Region 3, appointed three
creditors of Samson Resources Corp. and its affiliated debtors to
serve on the official committee of unsecured creditors.
SAMSON RESOURCES: Proposes Incentive & Severance Programs
---------------------------------------------------------
Samson Resources Corporation, et al., seek Bankruptcy Court
approval of a (a) non-insider incentive program for the first eight
and a half months of 2016, and (b) a non-officer severance
program.
The Debtors seek authority to honor obligations arising under their
non-insider incentive program for the first eight and a half months
of 2016. The Debtors filed the motion having just learned that
their interim Chief Executive Officer and Chief Operating Officer
(Richard Fraley) has resigned, effective Feb. 15, 2016. This
departure comes shortly after the Debtors' former Chief Executive
Officer and three vice presidents announced their resignations.
Although the Debtors are making arrangements to fill these key
positions, there can be no dispute that the Debtors have an
immediate business need to assuage employees' concerns regarding
the direction of these cases and motivate employees to continue to
perform at their highest levels. Even amongst the Debtors' general
workforce, the employee attrition rate has significantly
accelerated since the end of 2015. It is thus critical that the
non-insider incentive program be approved at this time to ensure
that the Debtors' key rank and file employees remain with the
company. The Debtors have had substantial discussions with the
official committee of unsecured creditors and the agents under the
Debtors' credit facilities regarding the programs.
The 2016 non-insider incentive program is similar to the program
that the Debtors previously sought approval of -- and that the
Court approved -- for the fourth quarter of 2015.
While the Debtors began the cases hopeful that they would emerge
from bankruptcy in early 2016, they have had to adjust their plans
in light of rapidly deteriorating market conditions. And the
market conditions have necessitated an evaluation of their business
operations and cost structure. To balance the need to reduce
costs, motivate all employees, and retain key employees, the
Debtors made two adjustments to their non-insider incentive
program. First, the Debtors reallocated the amounts available for
each employee to reflect each employee's workload and overall
importance to the Debtors during these cases.
Significantly, the Debtors seek authority to make, at most,
approximately $6.3 million in incentive payments in the first eight
and a half months of 2016 -- approximately $2.3 million less in
incentive payments than they would if they had not updated their
non-insider incentive program. The reduced amount is due, in part,
to a smaller participant pool and lower overall headcount. Second,
the Debtors altered the payment schedule, with payments under the
program payable on the date an order is entered confirming a
chapter 11 plan (or the date of the closing of a sale of
substantially all of the Debtors' assets); provided that if there
has been no order entered confirming a chapter 11 plan (or the sale
of substantially all of the Debtors' assets has not closed) by
August 15, 2016, 75 percent of the payments shall be payable on
August 15, 2016, and 25 percent shall be payable as of the date an
order is entered confirming a chapter 11 plan (or the date of the
closing of a sale of substantially all of the Debtors' assets).
Payments are earned if -- and only if -- the employees remain
employed by the Debtors as of such payment dates.
With these changes, the non-insider incentive compensation program
will continue to encourage and reward exceptional performance by
all of the non-insiders.
The Debtors also intend to right-size their severance programs, in
part because the Debtors are considering whether to reduce their
overall workforce in the first half of 2016 in light of current
market dynamics. The Debtors' existing severance program provides
terminated employees with benefits of six months of base salary,
benefits under the Consolidated Omnibus Budget Reconciliation Act
of 1985 ("COBRA"), and target bonus plus an additional prorated
portion of their target bonus. In consultation with their
advisors, management proposed to Samson's Board of Directors that
the existing non-officer severance program be amended to provide
three months of base salary and an amount equal to three months of
benefits under COBRA for each impacted employee.
Prior to entry of the 2015 Non-Insider Orders, the Debtors provided
each of their primary creditor constituencies with significant
information and detail regarding the quarterly incentive program
and non-insider severance programs, including plan structure and
estimated costs per employee. The Debtors again provided these
constituencies with information and detail regarding potential 2016
payments in advance of filing the motion.
The Debtors and their advisors have also had substantial follow-up
discussions with the official committee of unsecured creditors and
the agents under the Debtors' credit facilities regarding the
details of the non-insider incentive program and amendment to the
non-officer severance program. All such parties support the relief
requested herein. The Debtors will continue to engage in
discussions with their primary creditor constituencies, as well as
with the Office of the United States Trustee, prior to the hearing
on the motion.
The Debtors believe it is important to provide direction and
incentive goals, as well as assurance of their ability to make
severance payments, to their workforce at the beginning of 2016.
With respect to their non-insider incentive compensation program,
this timing will permit all of their employees to know, from the
outset of the calendar year, their Court-approved compensation
opportunities. Implementing both of these programs is essential to
maintaining employee morale and minimizing the adverse effects of
these chapter 11 cases on the Debtors' ongoing business operations.
Authorizing the Debtors to make payments under these programs
will, in the Debtors' business judgment, maximize the value of the
Debtors' estates for the benefit of all stakeholders.
Co-Counsel for the Debtors and Debtors in Possession:
Domenic E. Pacitti, Esq.
Michael W. Yurkewicz, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
919 N. Market Street, Suite 1000
Wilmington, DE 19801
Telephone: (302) 426-1189
Facsimile: (302) 426-9193
- and -
Morton Branzburg, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
1835 Market Street, Suite 1400
Philadelphia, PA 19103
Telephone: (215) 569-2700
Facsimile: (215) 568-6603
- and -
Paul M. Basta, P.C.
Edward O. Sassower, P.C.
Joshua A. Sussberg, P.C.
Ryan J. Dattilo
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, NY 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
- and -
James H.M. Sprayregen, P.C.
Ross M. Kwasteniet, Esq.
Brad Weiland, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
About Samson Resources
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (D. Del. Lead Case No. 15-11934) on Sept. 16, 2015.
Philip W. Cook signed the petition as executive vice president and
chief financial officer. The Debtors estimated assets and
liabilities of more than $1 billion.
Samson is an onshore oil and gas exploration and production
company
with interests in various oil and gas leases primarily located in
Colorado, Louisiana, North Dakota, Oklahoma, Texas, and Wyoming.
The Operating Companies operate, or have royalty or working
interests in, approximately 8,700 oil and gas production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Kirkland & Ellis LLP represents the Debtors as general counsel.
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' investment
banker. Garden City Group, LLC serves as claims and noticing agent
to the Debtors.
Andrew Vara, acting U.S. trustee for Region 3, appointed three
creditors of Samson Resources Corp. and its affiliated debtors to
serve on the official committee of unsecured creditors.
SAMSON RESOURCES: Proposes Performance Award Program
----------------------------------------------------
Samson Resources Corporation, et al., ask the Bankruptcy Court for
authority to extend their Performance Award Program for their three
senior officers.
A hearing on the Motion is slated for Feb. 22, 2016 at 2:00 p.m.
Objections are due Feb. 12, 2016 at 4:00 p.m.
The Debtors propose a quarterly incentive program for their senior
management team, who will be critical to driving performance and
leading the Debtors to emerge from chapter 11. The Debtors have
had substantial discussions with the official committee of
unsecured creditors and the agents under the Debtors' credit
facilities regarding the Performance Award Program and believe that
all such parties support the relief requested herein.
The Debtors filed the Motion shortly after learning that their
interim Chief Executive Officer and Chief Operating Officer,
Richard Fraley, has announced his resignation, effective Feb. 15,
2016. Andrew Kidd -- the Debtors' current General Counsel -- will
succeed Mr. Fraley as Chief Executive Officer and Sean Woolverton
-- the Debtors' current Vice President of Operations, East Division
-- will succeed Mr. Fraley as Chief Operating Officer. Philip Cook,
the Debtors' third insider, is continuing his role as the Debtors'
Chief Financial Officer.
The Debtors seek to continue their existing insider incentive
program -- one that has been in place since mid-2015 -- and have
not altered the program's overall structure. For each quarter, the
Performance Award Program requires the Debtors to develop (a)
performance metrics important to their business (which may include
financial, operational, and process-based metrics), (b) targets for
these metrics, and (c) award opportunities for each target.
The Debtors have already established reasonable and incentivizing
performance metrics, targets, and award opportunities for the first
quarter of 2016. Indeed, the performance metrics for the first
quarter (production and operating expense) are identical to those
for the fourth quarter of 2015.
When designing the 2016 Performance Award Program, the Debtors
originally intended to set the same performance metrics and award
opportunities for each quarter of 2016 (with quarterly targets set
each quarter based on the Debtors' business plan, subject to notice
and objection rights of key stakeholders in these cases). Following
extensive discussions with their primary creditor constituencies,
however, the Debtors ultimately agreed not to set the performance
metrics, targets, or award opportunities for the second, third, and
fourth quarters in advance of filing this motion. Instead, after
soliciting input from their key stakeholders, the Debtors will set
each of the performance metrics, targets, and award opportunities
for the remaining three quarters of 2016 in advance of each
quarter, and will provide their key stakeholders with notice of an
opportunity to object to each such aspect of the program. While
the Debtors still intend to use the same metrics and award
opportunities for each quarter of 2016, and in no event will the
Debtors materially increase the insiders' award opportunities for
the last three quarters of 2016 without filing a separate motion,
in an effort to build consensus, the Debtors are seeking approval
of the Performance Award Program as modified to give their key
stakeholders an opportunity to provide feedback as the Debtors set
their metrics, targets, and award opportunities for future
quarters. The Debtors will provide parties in interest -- the
first and second lien agents, the official committee of unsecured
creditors, and the U.S. Trustee -- at least 10 business days to
review and object prior to each performance period.
The Performance Award Program will encourage and reward exceptional
performance by all of the remaining insiders. The Debtors rely on
the insiders to drive complex operations for the production of oil
and natural gas across the country. Due to the resignations of the
Debtors' former CEO in December 2015 and his successor, Mr. Fraley,
this responsibility now falls on the shoulders of the Debtor's
remaining insiders -- Andrew Kidd (Chief Executive Officer/General
Counsel), Sean Woolverton (Chief Operating Officer), and Philip
Cook (Chief Financial Officer). The Performance Award Program is
critical to keeping the insiders motivated as they navigate the
Debtors through these chapter 11 cases. As with the previously
approved insider awards, the participants are eligible to earn
market-based bonuses if -- and only if -- the Debtors meet
objective, value-maximizing performance-based targets.
Approval of the Performance Award Program for 2016 comes at a
critical juncture for these Debtors. The timing of these cases and
the path forward is uncertain, but no matter the outcome, the
Debtors must continue to incentivize members at the highest levels
of their operations. The Performance Award Program has and will
continue to incentivize senior management to drive performance for
the entire organization -- at a time when drilling has been
suspended and the future prospects of the company are uncertain
--and should be approved.
About Samson Resources
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (D. Del. Lead Case No. 15-11934) on Sept. 16, 2015.
Philip W. Cook signed the petition as executive vice president and
chief financial officer. The Debtors estimated assets and
liabilities of more than $1 billion.
Samson is an onshore oil and gas exploration and production company
with interests in various oil and gas leases primarily located in
Colorado, Louisiana, North Dakota, Oklahoma, Texas, and Wyoming.
The Operating Companies operate, or have royalty or working
interests in, approximately 8,700 oil and gas production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Kirkland & Ellis LLP represents the Debtors as general counsel.
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' investment
banker. Garden City Group, LLC serves as claims and noticing agent
to the Debtors.
Andrew Vara, acting U.S. trustee for Region 3, appointed three
creditors of Samson Resources Corp. and its affiliated debtors to
serve on the official committee of unsecured creditors.
SAMSON RESOURCES: Seeks to Sell Certain Oil and Gas Assets
----------------------------------------------------------
Samson Resources Corporation, et al., filed with the Bankruptcy
Court a motion seeking authorization to sell more than 1,000 of
their wells by way of auctions or privately-negotiated sales
pursuant to Sections 363(b) and (c) of the Bankruptcy Code.
From time to time, the Debtors participate in auctions for oil and
gas properties in which the Debtors sell rights in certain of their
properties. Oil and Gas Auctions are conducted by a number of
specialized clearinghouses and are commonly utilized in the
exploration and production industry for matching willing sellers
looking to dispose of properties with willing buyers seeking to
acquire oil and gas properties.
The Oil and Gas Clearinghouse, the clearinghouse for auctioning the
Debtors' assets, is holding an Oil and Gas Auction on March 9,
2016.
In evaluating their businesses and properties in the recent months,
the Debtors have identified approximately 1,262 wells and related
property and interests that do not fit their business model. Many
of the Wells are old with limited going-forward production
capability. The aggregate PV9 reserve value for the Wells is
approximately $16.5 million. Approximately 571 of the Wells are
subject to mortgages and are valued by the Debtors at less than $1
million each. Approximately 691 of the Wells, on the other hand,
are unmortgaged and/or are valued by the Debtors at more than $1
million each. The proceeds from the sale of any Well not subject
to a mortgage will be held separately from the Debtors' operating
cash. The Debtors seek to put the Wells up for auction at OGAC's
March 9, 2016 auction or otherwise consummate private sales for the
Wells.
In addition to the OGAC Oil and Gas Auction, and as an alternative
to the OGAC Oil and Gas Auction, the Debtors seek authority to
negotiate and consummate private sales of the Wells. While the
Debtors anticipate selling the vast majority of the Wells through
the OGAC Oil and Gas Auction, the Debtors may be unable to sell
some Wells through the auction. In that instance, the Debtors
could obtain value in a private sale. Some of these private sales
will be conducted on the same terms as sales conducted through an
Oil and Gas Auction; the Wells will be sold "as is" with the buyer
assuming all related liabilities. Others may be consummated as a
sale under section 363 of the Bankruptcy Code, with the buyer
acquiring the Wells free and clear of all claims, liens, and
interests. Obtaining authority now to pursue these sales will
ensure that the Debtors are able to maximize the value of the Wells
and minimize transaction costs to their estates.
A hearing on the Motion is slated for Feb. 22, 2016 at 2:00 p.m.
Objections are due Feb. 12, 2016 at 4:00 p.m.
About Samson Resources
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (D. Del. Lead Case No. 15-11934) on Sept. 16, 2015.
Philip W. Cook signed the petition as executive vice president and
chief financial officer. The Debtors estimated assets and
liabilities of more than $1 billion.
Samson is an onshore oil and gas exploration and production company
with interests in various oil and gas leases primarily located in
Colorado, Louisiana, North Dakota, Oklahoma, Texas, and Wyoming.
The Operating Companies operate, or have royalty or working
interests in, approximately 8,700 oil and gas production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Kirkland & Ellis LLP represents the Debtors as general counsel.
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' Investment
banker. Garden City Group, LLC serves as claims and noticing agent
to the Debtors.
Andrew Vara, acting U.S. trustee for Region 3, appointed three
creditors of Samson Resources Corp. and its affiliated debtors to
serve on the official committee of unsecured creditors.
SANDRIDGE ENERGY: In Talks with Banks on Restructuring Options
--------------------------------------------------------------
Mike Stone and Jessica Dinapoli at Reuters.com reported that
SandRidge Energy Inc. is exploring debt restructuring options,
according to people familiar with the matter, as the heavily
indebted U.S. oil and gas exploration and production company
struggles with the fallout from plunging energy prices.
SandRidge has been in talks with investment banks and law firms
about hiring restructuring advisors, and could make an announcement
on their appointment as early as this week, the people said.
Debtwire had reported on Jan. 13, also citing unnamed sources, that
SandRidge -- which produces oil and gas from shale formations in
the Mid-Continent region of the United States -- had hired Houlihan
Lokey to craft a restructuring plan. Houlihan Lokey is very likely
to be named SandRidge's financial advisor for any restructuring,
the Reuters sources said.
These sources asked not to be identified because the deliberations
are confidential.
Oklahoma City-based SandRidge, which has a debt burden of around $4
billion, has already been reaching out to some of its creditors to
inform them that they should work together to prepare for likely
negotiations, one of the sources said.
The vast majority of the company's debt is in the form of bonds
owned by a plethora of mutual funds, hedge funds, and other
institutional investors.
One of the options that the company will consider is a prepackaged
bankruptcy with the agreement of its creditors, the people said.
They said that a decision on a way forward is not imminent and that
the company has access to enough cash to continue doing business
for at least several more months under its current structure.
Other avenues SandRidge could pursue would include a debt exchange
or filing for bankruptcy protection without any agreement with its
creditors. It is not clear whether the company currently has a
preference for a particular route.
Settled Dispute
On Jan. 22, 2016, SandRidge said it had also settled a dispute
stemming from a 30-year agreement to send Occidental Petroleum Corp
a fixed amount of natural gas from the Pinon field in west Texas
each year. Occidental had been treating the gas to extract carbon
dioxide which it uses in its own oil recovery business and then
sending methane back to SandRidge. However, low natural gas prices
have made it uneconomic for SandRidge to fulfill the contract and
it faced potential penalties that could have eventually run into
the hundreds of millions of dollars.
Under the agreement, SandRidge will hand over the Pinon assets to
Occidental plus $11 million in cash and Occidental will drop any
claims from the previous deal. SandRidge said the settlement is
expected to reduce its operating costs by $39 million in 2016.
Shares Delisted
As of earlier this month, SandRidge's shares are no longer listed
on the New York Stock Exchange, and trade on the OTC Pink
marketplace instead with a market capitalization of around $30
million.
Its bonds are trading at extremely distressed levels, with its Jan.
15 2020 notes at below 5 cents on the dollar.
A copy of the report is available for free at http://is.gd/SjaFPQ
SANTA FE GOLD: Cancels Chapter 11 Auction, Names Waterton Buyer
---------------------------------------------------------------
Matt Chiappardi at Bankruptcy Law360 reported that Santa Fe Gold
Corp. told a Delaware bankruptcy judge Jan. 25, 2016, that it
canceled its auction and deemed stalking horse bidder and
prepetition lender Waterton Global Value LP the proposed buyer, but
must still work out opposition from unsecured creditors over the
credit bid and how value will be distributed.
During a hearing in Wilmington, Santa Fe Gold attorney Kenneth J.
Enos of Young Conaway Stargatt & Taylor said the precious metals
miner intends to present the proposed sale to the court Feb. 5.
About Santa Fe Gold
Santa Fe Gold Corporation and three affiliated entities, a group of
mining and mineral exploration companies headquartered in
Lordsburg, New Mexico, filed Chapter 11 bankruptcy petitions
(Bankr. D. Del. Lead Case No. 15-11761) on Aug. 26, 2015, to pursue
an expedited sale of their assets in order to maximize value for
all stakeholders.
The case is pending before the Honorable Mary F. Walrath. The
cases are being jointly administered for procedural purposes. The
Debtor continues to operate its business and manage its properties
as a debtor-in-possession.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP, as
counsel; Canaccord Genuity Group Inc., as financial advisor; and
American Legal Claim Services, LLC, as notice, claims, and
solicitation agent.
Santa Fe Gold disclosed $19.1 million in assets and $29.9 million
in debt as of March 31, 2015.
SANTA FE GOLD: Needs Until March 23 to File Ch. 11 Plan
-------------------------------------------------------
Santa Fe Gold Corporation, et al., ask the U.S. Bankruptcy Court
for the District of Delaware to extend their exclusive period to
file a Chapter 11 plan through and including March 23, 2016, and to
solicit votes to approve a Chapter 11 plan through and including
May 23, 2016.
According to Ian J. Bambrick, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, extending the Exclusive
Periods will facilitate an orderly and cost-effective process for
the benefit of all creditors by providing the Debtors with a
meaningful opportunity to build on the progress that has been made
in these Chapter 11 Cases without unnecessary interference from
non-debtor parties.
Termination of the Exclusive Periods, on the other hand, would give
rise to the threat of competing plans, resulting in increased
administrative expenses that would diminish the value of the
Debtors' estates to the detriment of creditors, Mr. Bambrick tells
the Court. Termination of the Exclusive Periods could also
meaningfully delay, if not completely undermine, the Debtors'
ability to confirm any plan, Mr. Bambrick adds.
Moreover, extending the Exclusive Periods will not harm or
prejudice the Debtors' creditors or other parties in interest, Mr.
Bambrick assures the Court.
Robert S. Brady, Esq., Edmon L. Morton, Esq., and Kenneth J. Enos,
Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington,
Delaware, also represent the Debtors.
About Santa Fe Gold
Santa Fe Gold Corporation and three affiliated entities, a group
of
mining and mineral exploration companies headquartered in
Lordsburg, New Mexico, filed Chapter 11 bankruptcy petitions
(Bankr. D. Del. Lead Case No. 15-11761) on Aug. 26, 2015, to
pursue
an expedited sale of their assets in order to maximize value for
all stakeholders.
The case is pending before the Honorable Mary F. Walrath. The
cases are being jointly administered for procedural purposes. The
Debtor continues to operate its business and manage its properties
as a debtor-in-possession.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP, as
counsel; Canaccord Genuity Group Inc., as financial advisor; and
American Legal Claim Services, LLC, as notice, claims, and
solicitation agent.
Santa Fe Gold disclosed $19.1 million in assets and $29.9 million
in debt as of March 31, 2015.
SCHWAB INDUSTRIES: Ch. 11 Trustee's Claims Barred by Res Judicata
-----------------------------------------------------------------
Defendants David A. Schwab, Jerry A. Schwab and Donna L. Schwab
moved the United States Bankruptcy Court for the Northern District
of Ohio, Eastern Division, for summary judgment, primarily
challenging Plaintiff/Creditor Trustee John B. Pidcock's claims
based on res judicata.
In a Memorandum of Decision dated January 15, 2016, which is
available at http://is.gd/9jalzMfrom Leagle. com, Judge Russ
Kendig of the United States Bankruptcy Court for the Northern
District of Ohio, Eastern Division, granted the Defendants' bids
for summary judgment.
The Debtors and the Defendants were directly and intimately
involved in the sale process and were parties to the sale order.
The claims now asserted by the Plaintiff were raised two times
during the sale process and withdrawn. Specific findings in the
sale order negate the alleged harm now claimed. While the exact
specifics of the side deals may not have been known, there was
sufficient information to put the Committee and the Plaintiff on
notice and provoke additional inquiry, Judge Kendig pointed out.
Failure to pursue full disclosure may have been a calculated,
strategic decision to allow the assets to be sold while the
business was operating and the fire was hot rather than risk any
devaluation a delay may have wrought, Judge Kendig further pointed
out. Regardless, to the extent the present claim was not actually
litigated during the sale process, the overlap in the findings
supporting the sale order, including findings that the process
generated the best price for the assets and the sale was fair and
reasonable, and the allegations of the complaint suggesting the
Defendants' actions harmed the sale process, create an identity
between the causes of action for res judicata purposes, Judge
Kendig held.
The court finds the fourth element is satisfied.
The case is IN RE: SII LIQUIDATION COMPANY, Chapter 11, Debtors.
JOHN B. PIDCOCK, AS CREDITOR TRUSTEE, Plaintiff, v. JERRY A.
SCHWAB, et al., Defendants, Case No. 10-60702, Adv. No. 12-6022.
John B. Pidcock, as creditor trustee, Plaintiff, is represented by
Thomas R. Fawkes, Esq. -- tomf@restructuringshop.com -- Goldstein &
McClintock LLLP, Eugene J. Geekie, Jr., Esq. -- Freeborn & Peters
LLP, Steven M. Hartmann, Esq. -- shartmann@freeborn.com --
Freeborn & Peters LLP, Shira Isenberg, Esq. --
sisenberg@freeborn.com -- Freeborn & Peters LLP, Richard S.
Lauter, Esq. -- rlauter@freeborn.com -- Freeborn & Peters LLP,
Douglas L Lutz, Esq. -- dlutz@fbtlaw.com -- Frost Brown Todd LLC,
Terrence J. Sheahan, Esq. – tsheahan@freeborn.com -- Freeborn &
Peters LLP.
Jerry A. Schwab, Defendant, is represented by Julie L Juergens,
Esq. -- msansalone@gallaghersharp.com -- Monica Sansalone,
Gallagher Sharp.
David A. Schwab, Defendant, is represented by Julie L Juergens,
Gallagher Sharp.
About Schwab Industries
Dover, Ohio-based Schwab Industries, Inc., produced, supplied and
distributed ready-mix concrete, concrete block, cement and related
supplies to commercial, governmental and residential contractors
throughout Northeast Ohio and Southwest Florida.
The Company filed for Chapter 11 bankruptcy protection (Bankr.
N.D. Ohio Case No. 10-60702) on Feb. 28, 2010. Affiliates Medina
Cartage Co.; Medina Supply Company; Quality Block & Supply, Inc.;
O.I.S. Tire, Inc.; Twin Cities Concrete Company; Schwab Ready-Mix,
Inc.; Schwab Materials, Inc.; and Eastern Cement Corp. also sought
bankruptcy protection. The Parkland Group, Inc., provided
restructuring services and designated Laurence V. Goddard as Chief
Restructuring Officer. Hahn Loeser & Parks LLP served as
bankruptcy counsel. Brouse McDowell, LPA, served as special
counsel. Garden City Group, Inc., served as claims, noticing and
balloting agent. The Company estimated its assets and liabilities
at $50 million to $100 million.
As part of the bankruptcy, substantially all of the Debtors'
assets via auction. The Court entered a sale order on May 28,
2010. Subsequently, the Court confirmed a liquidation plan.
Through the sale and plan, a creditor trust was established for
the benefit of the unsecured creditors and John B. Pidcock was
designated Creditor Trustee. The Debtor was later renamed SII
Liquidation Company.
SEARS METHODIST: Court Orders Dismissal of CSL's Bankruptcy Case
----------------------------------------------------------------
A federal judge has ordered the dismissal of the Chapter 11 case of
Canyons Senior Living LP.
The order, issued by U.S Bankruptcy Judge Stacey Jernigan,
dismissed the bankruptcy case at the request of the Texas-based
company.
CSL, an affiliate of Sears Methodist Retirement System Inc., asked
for the dismissal of its case following the appointment of a
receiver who took control over the management of its business.
The company's assets had been turned over to the receiver since his
appointment in September 2014, except for one operating account,
according to court filings.
"Nearly all of CSL's assets have been turned over to the receiver
making it impossible for CSL to rehabilitate and continue offering
services to residents," said its lawyer, Vincent Slusher, Esq., at
DLA Piper LLP, in Dallas, Texas.
CSL owns the Canyons Retirement Community in Amarillo, Texas, which
consists of 109 apartments. The receiver has already retained a
broker to solicit offers for the purchase of the Canyons.
Separately, an affiliate of Sears Methodist sold to Texas Methodist
Foundation all of its rights and interests in an undeveloped land
located in Waco, Texas.
Texas Methodist, one of the biggest creditors, purchased the
property from Sears Methodist Centers Inc. by use of a so-called
credit bid.
The credit bid in the amount of $858,000 was selected as the
winning bid at a bankruptcy auction held last year, according to
court filings.
About Sears Methodist
Sears Methodist Retirement System Inc. provides luxurious residency
to seniors. The system includes: (i) eight senior living
communities located in Abilene, Amarillo, Lubbock, Odessa and
Tyler, Texas; (ii) three veterans homes located in El Paso, McAllen
and Big Spring, Texas, managed by Senior Dimensions, Inc., pursuant
to contracts between SDI and the Veterans Land Board of Texas; and
(iii) Texas Senior Management, Inc. ("TSM"), Senior Living
Assurance, Inc. ("SLA") and Southwest Assurance Company, Ltd.
("SWAC"), which provide, as applicable, management and insurance
services to the System. Sears Methodist Senior Housing, LLC, is
the general partner of, and controls .01% of the interests in,
Canyons Senior Living, L.P. ("CSL").
Sears Methodist and its affiliates sought protection under Chapter
11 of the Bankruptcy Code (Bankr. N.D. Tex. Lead Case No. 14-32821)
on June 10, 2014. The cases are assigned to Judge Stacey G.
Jernigan.
The Debtors' counsel is Vincent P. Slusher, Esq., and Andrew
Zollinger, Esq., at DLA Piper LLP (US), in Dallas, Texas; and
Thomas R. Califano, Esq., Gabriella L. Zborovsky, Esq., and Jacob
S. Frumkin, Esq., at DLA Piper LLP (US), in New York. The Debtors'
financial advisor is Alvarez & Marsal Healthcare Industry Group,
LLC, while the Debtors' investment banker is Cain Brothers &
Company, LLC. The Debtors' notice, claims and solicitation agent
is GCG Inc.
The Debtors have sought and obtained an order authorizing joint
administration of their Chapter 11 cases.
The Official Committee of Unsecured Creditors is represented by
Clifton R. Jessup, Jr., Esq., and Bryan L. Elwood, Esq., at
Greenberg Traurig, LLP, in Dallas, Texas.
SFX ENTERTAINMENT: Files for Chapter 11 Bankruptcy Protection
-------------------------------------------------------------
SFX Entertainment, Inc., et al., producer of live events and
digital entertainment, sought Chapter 11 bankruptcy protection in
order to restructure their balance sheet and effect necessary
operational changes. The Debtors believe that a Chapter 11 process
is the only way to achieve these goals and maximize the value of
the Company.
The Debtors expect a short stay in Chapter 11 and intend to emerge
as a strong business partner to its sponsors, production vendors,
music talent, customers and the electronic dance music community as
a whole.
According to Michael Katzenstein, chief restructuring officer, the
Debtors began to face significant liquidity issues in 2015 as a
result of a confluence of factors, including a failure to
consummate a potential sale of the entire company or for non-core
assets to Sillerman Investment Company III LLC and a default under
a credit agreement as a result of the non-funding of the Series A
Preferred Stock.
"These liquidity issues have reached a crescendo in recent months,"
Mr. Katzenstein said. "Currently, the Company has an interest
payment on its Notes due on Feb. 1, 2016, that it lacks the funds
to pay. Further, the Company is without the liquidity to make
critical payments absent DIP financing," he added.
In its efforts to source funding, the Company began discussions
with an ad hoc group of Noteholders as to a potential capital raise
and the potential restructuring of the Notes and recapitalization
of the Company. As of the Petition Date, the Debtors are informed
that the Ad Hoc Group holds over 70% of the Notes.
RSA and DIP Agreement
On Jan. 31, 2016, the Company, the Consenting Noteholders, and
Sillerman entered into a restructuring support agreement to provide
for a roadmap for these Chapter 11 cases that focuses on the
Debtors' ultimate goal -- the expedient and efficient emergence
from Chapter 11.
The Restructuring Support Agreement provides for a comprehensive
restructuring to accomplish a necessary balance sheet deleveraging
that will maximize the value of the Debtors' enterprise for the
benefit of the Debtors' estates, creditors, and other parties-in-
interest.
The Debtors have also obtained DIP financing from certain members
of an Ad Hoc Group of holders of its Notes. The DIP financing will
provide the Debtors with $115 million of committed DIP financing,
with an uncommitted additional $10 million tranche.
First Day Motions
Concurrently with the filing of the Chapter 11 cases, the Debtors
filed a number of first day motions seeking, among other things,
authority to use existing cash management system, pay employee
compensation, pay critical vendor claims, prohibit utility
providers from discontinuing services, obtain postpetition
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/13_SFX_Declaration.pdf
About SFX Entertainment
SFX Entertainment, Inc., and 43 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10238 to
16-10281) on Feb. 1, 2016. The petitions were signed by Michael
Katzenstein as chief restructuring officer.
The Debtors disclosed total assets of $661.6 million and total
debts of $490.2 million.
Greenberg Traurig, LLP serves as the Debtors' counsel. Kurtzman
Carson Consultants LLC acts as the Debtors' claims and noticing
agent.
Judge Mary F. Walrath is assigned to the case.
SHREE MELDIKRUPA: Court Grants Use of Cash Collateral
-----------------------------------------------------
Shree Meldikrupa Incorporated filed an Amended Motion For Order to
Use Cash Collateral.
According to the Debtor, tthe disputed cash collateral is critical
to the operation of the Debtor's business and is the only source
from which to pay expenses and purchase inventory. Three
creditors, Hinesville Loan Pool, Georgia Lottery Corporation and
Cornerstone Bank objected to the Debtor's proposed use of cash
collateral.
In an Opinion dated January 15, 2016, which is available at
http://is.gd/PZQZgwfrom Leagle.com, Judge Edward J. Coleman, III,
of the United States Bankruptcy Court for the Southern District of
Georgia, Savannah Division, granted the Debtor's Amended Cash
Collateral Motion.
The case is In the matter of: SHREE MELDIKRUPA INC. Chapter 11,
Debtor, No. 15-41411-EJC (Bankr. S.D. Ga.).
Shree Meldikrupa Incorporated, Debtor, is represented by:
R. Brandon Galloway, Esq.
GALLOWAY & GALLOWAY, PC
P O Box 674
Pooler, GA 31322
Tel: 912-748-9100
Fax: 912-748-9109
Email: amanda@gallowaylaw.com
Shree Meldikrupa Incorporated sought protection under Chapter 11 of
the Bankruptcy Code on Aug. 31, 2015 (Bankr. S.D. Ga., Case No.
15-41411). The Debtor's counsel is R. Brandon Galloway, Esq., at
Galloway & Galloway, PC, in Pooler, Georgia. The petition was
signed by Kantilal Patel, CEO.
SIGA TECHNOLOGIES: Prescott Group Has 3.8% Stake as of Jan. 29
--------------------------------------------------------------
Prescott Group Capital Management, L.L.C.; Prescott Group
Aggressive Small Cap, L.P.; Prescott Group Aggressive Small Cap II,
L.P.; and Phil Frohlich disclosed in an Amendment No. 1 to the
Schedule 13G, filed with the Securities and Exchange Commission on
Jan. 29, 2016, that they may be deemed to beneficially own
2,037,600 shares or roughly 3.8% of the common stock, $0.0001 par
value, of SIGA Technologies, Inc.
The Amendment relates to shares of SIGA Common Stock purchased by
the Small Cap Funds through the account of Prescott Group
Aggressive Small Cap Master Fund, G.P., an Oklahoma general
partnership, of which the Small Cap Funds are general partners.
Prescott Capital serves as the general partner of the Small Cap
Funds and may direct the Small Cap Funds, the general partners of
Prescott Master Fund, to direct the vote and disposition of the
2,037,600 shares of Common Stock held by the Master Fund. As the
principal of Prescott Capital, Mr. Frohlich may direct the vote and
disposition of the 2,037,600 shares of Common Stock held by
Prescott Master Fund.
About SIGA Technologies
Publicly held SIGA Technologies, Inc., with headquarters in Madison
Avenue, New York, is a biotech/pharmaceutical company that
specializes in the development and commercialization of solutions
for serious unmet medical needs and biothreats. SIGA's lead
product is Tecovirimat, also known as ST-246, an orally
administered antiviral drug that targets orthopoxviruses.
SIGA sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case
No. 14-12623) on Sept. 16, 2014, in Manhattan. The case is
assigned to Judge Sean H. Lane.
The Debtor has tapped Weil, Gotshal & Manges LLP, as counsel, and
Prime Clerk LLC as claims agent. PricewaterhouseCoopers LLP serves
as auditor.
The Debtor disclosed total assets of $131,669,746 and $7,954,645 in
liabilities as of the Chapter 11 filing.
The Statutory Creditors' Committee is represented by Martin J.
Bienenstock, Esq., Scott K. Rutsky, Esq., and Ehud Barak, Esq., at
Proskauer Rose LLP. The Committee tapped to retain Guggenheim
Securities, LLC, as its financial advisor and investment banker.
* * *
SIGA filed with the Bankruptcy Court, on Dec. 15, 2015, a
reorganization plan sets out the terms and conditions under which
SIGA will seek to exit from bankruptcy. The plan filed was
negotiated between SIGA and the Statutory Creditor's Committee of
which PharmAthene Inc. is a member.
SOUTHEAST POWERGEN: Moody's Cuts Rating on $545.5MM Debt to Ba3
---------------------------------------------------------------
Moody's Investors Service downgraded the rating assigned to
Southeast PowerGen LLC's (SEPG) $545.5 million senior secured
credit facilities to Ba3 from Ba2. The outlook is negative. The
credit facilities consist of a $475.0 million term loan due 2021
and a $70.5 million senior secured revolving credit/letter of
credit facility due 2019.
Separately, Moody's affirmed the Baa3 rating assigned to SEPG's
affiliate Mackinaw Power, LLC's (Power) $118 million senior secured
notes due 2023 and changed the outlook to negative from stable.
SEPG owns a portfolio of six gas-fired generating facilities in
Georgia with a combined electric generating capacity of 2,747
megawatts. Power is a subsidiary of SEPG and currently owns four
of the six generating facilities with a combined generating
capacity of 1,867 megawatts.
RATING RATIONALE
"T[he] rating action at SEPG incorporates the fact that two
contracts, representing approximately 30% of SEPG's generating
capacity were not renewed and expired at the end of 2015. Our
previous rating had incorporated the view that the sponsors would
be able to re-contract this capacity," said Moody's Senior Credit
Officer Scott Solomon.
Moody's understands that in light of the very weak wholesale power
market in the Southeastern US (SERC), the sponsors will operate
these assets on a merchant basis as they continue to pursue
contractual opportunities. "A reliance on merchant cash flows,
however, negatively impacts SEPG's risk profile, and is reflected
in the one-notch downgrade" added Solomon.
Tolling contacts between unaffiliated third parties and the 510 MW
Effingham facility and Sandersville Units 3,4,7&8 (300 MW's of
capacity) expired on Dec. 31, 2015. SEPG's former rating had
incorporated our belief that that the sponsors would be able to
re-contract the capacity and output from these units. Moody's
cannot anticipate when or if these assets will be re-contracted.
Balancing this exposure to the weak merchant market is the fact
that capacity and output from SEPG's four other generating
facilities and from Sandersville Units 1,2,5&6, also directly owned
by SEPG, are contracted with various third party entities for terms
that extend beyond the tenor of the term loan.
SEPG's negative outlook considers the expected decline in SEPG's
near-term financial performance, along with its likely increased
reliance on the wholesale power markets for revenues and cash flow.
SERC, the regional power pool in which Effingham and the four
un-contracted Sandersville units operate, does not have a
centralized capacity market. As such, SEPG will need to
economically dispatch these assets on a bilateral basis to generate
cash flow. Effingham is an efficient combined-cycle gas-fired
plant that will be economically dispatched. The facility, however,
is undergoing a planned major maintenance during the first months
of 2016 and its dispatch levels as well as regional forward power
and gas curves are uncertain. Sandersville is a peaking facility
and not anticipated to generate significant merchant cash flows.
In light of today's downgrade at SEPG, along with the increased
exposure to the merchant market captured under the negative
outlook, the rating is not likely to be upgraded in the near-term.
SEPG's rating would likely be further downgraded if we believed
that the ratio of consolidated FFO to debt were to end up below 5%
on a sustained basis.
The Baa3 rating affirmation at Power reflects historically strong
performance and the belief that based upon current ownership, the
portfolio could provide sustained financial metrics that exceed a
debt service coverage ratio (DSCR) of 1.4 times.
The change in Power's outlook to negative, however, reflects the
potential for weak financial performance as beginning in January
2016, with the expiry of the Effingham and Washington Units 1&4
tolling agreements, both power projects are allowed to be
transferred to SEPG and no longer a part of the senior notes'
collateral package, a credit weakness. Importantly for Power's
current credit quality, Washington Units 1&4 have been
re-contracted on a long-term basis with load serving rural
cooperatives providing additional long-term contracted cash flow.
Moody's understands that a release of the fully contracted
Washington Units 1&4 requires the consent of the lenders to its
working capital/LOC facility due 2017. Such consent is not
required for the fully merchant Effingham asset.
As such, should Power retain Washington Units 1&4, we calculate
DSCR at levels that will remain in excess of 1.4 times, solidly
positioning the credit within the Baa rating category. Conversely,
a release of the Washington Units 1&4, should it occur, would
reduce Power's cash flows materially leading to lower sustained
DSCR's more akin to a Ba rating category and could potentially
result in a negative rating action.
SEPG and Power are 75.05% owned by affiliates of The Carlyle Group
(Carlyle) and 24.95% by affiliates of GE Capital.
The principal methodology used in these ratings was Power
Generation Projects published in December 2012.
SUSAN MARIA RABORN: Court Denies Bid to Stay Suit Over Stock Sale
-----------------------------------------------------------------
Susan Maria Raborn filed a motion asking the United States District
Court for the Middle District of Louisiana to stay pending appeal
the lawsuit filed by Dr. Charles Raborn.
Dr. Raborn sued the Debtor in Louisiana state court to dissolve the
sale of stock in Pedicons, Inc., for failing to pay the purchase
price. Following a jury trial, the state court entered a judgment
dissolving the stock sale and recognizing Dr. Raborn as the owner
of the stock in accordance with the jury's verdict.
The Debtor filed an appeal in the bankruptcy court which Dr.
Charles Raborn opposed. The bankruptcy court denied relief,
finding that a stay was not warranted because the Debtor would not
suffer irreparable harm, would not likely be successful on the
merits, and it would not serve the public interest. The Debtor
then moves the Court to stay the bankruptcy court's order granting
Dr. Charles Raborn's motion for relief from the automatic stay
pending the outcome of the appeal.
In a Ruling dated January 15, 2016, which is available at
http://is.gd/LOVKQcfrom Leagle.com, Judge Shelly D. Dick of the
United States District Court for the Middle District of Louisiana
denied the Debtor's Emergency Motion.
The Court finds no errors in the bankruptcy court's findings of
fact or conclusions of law. In fact, the Court agrees with the
bankruptcy court that it is in the Debtor's best interests that the
state court litigation proceed because her right to the Pedicons
stock may be established, if she is successful, for purposes of her
Chapter 11 filing.
The case is IN RE: SUSAN MARIA RABORN, DEBTOR, Appeal Docket No.
16-00002-SDD-EWD.
Susan Maria Raborn, Appellant, Pro Se.
Charles Raborn, Appellee, is represented by Carlton Jones, III,
Esq. -- Roedel, Parsons, Koch, Blache, Balhoff & McCollister.
SUTTON LUMBER: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Sutton Lumber Co., Inc.
PO Box 391
Tennga, GA 30751
Case No.: 16-40233
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Northern District of Georgia (Rome)
Judge: Hon. Paul W. Bonapfel
Debtor's Counsel: Leslie M. Pineyro, Esq.
JONES AND WALDEN, LLC
21 Eighth Street, NE
Atlanta, GA 30309
Tel: (404) 564-9300
Fax: 404-564-9301
Email: lpineyro@joneswalden.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Harold Sutton, president.
A list of the Debtor's 19 largest unsecured creditors is available
for free at http://bankrupt.com/misc/ganb16-40233.pdf
SWIFT ENERGY: Kirkland and Klehr Harrison File Verified Statement
-----------------------------------------------------------------
Kirkland & Ellis LLP and Klehr Harrison Harvey Branzburg, LLP
submitted a verified statement under Rule 2019 of the Federal Rules
of Bankruptcy Procedure in connection with Kirkland's and Klehr
Harrison's representation of the ad hoc group of noteholders in the
Chapter 11 cases of Swift Energy Company and its affiliated
debtors.
The present members of the Ad Hoc Noteholder Group hold claims or
manage or advise certain funds and accounts that hold claims
against certain of the Debtors' estates arising from and related to
the Senior Notes. The members are:
* Bennett Restructuring Fund, L.P.
* Bennett Offshore Restructuring Fund, Inc.
* BOF Holdings IV, LLC
* Brevan Howard Master Fund Limited
* BRF High Value, L.P.
* DW Catalyst Master Fund, Ltd.
* Hutchin Hill Capital Primary Fund, Ltd.
* KORE Fund Ltd.
* LMA SPC
* MatlinPatterson Global Opportunities Master Fund L.P
* Merrill Lynch Pierce Fenner and Smith Incorporated
* Pentwater Capital Management LP
* Pine River Baxter Fund Ltd.
* Pine River Deerwood Fund Ltd.
* Pine River Fixed Income Master Fund Ltd.
* Pine River Master Fund Ltd.
* Pioneer Investment Management Inc.
* Strategic Value Special Situations Offshore Fund III-A, L.P.
* Strategic Value Special Situations Master Fund III, L.P.
* Strategic Value Master Fund, LTD.
* Sunrise Partners Limited Partnership
* Valo Group Fund, LP
* Wells Capital Management, Incorporated
* Wells Fargo Securities, LLC
* Whitebox Relative Value Partners, LP
* Whitebox Multi-Strategy Partners, LP
A full-text copy of the Verified Statement, which discloses the
nature and amount of holdings of each member of the Ad Hoc
Noteholder Group is available for free at:
http://bankrupt.com/misc/Swift_E_597_KE_2019_Stmnt.pdf
In September 2015, certain members of the Ad Hoc Noteholder Group
engaged K&E to represent them in connection with the Debtors'
potential restructuring. Each member of the Ad Hoc Noteholder
Group, in its capacity as such, has separately retained K&E to
serve as its counsel in connection with the Debtors' chapter 11
cases. Each member of the Ad Hoc Noteholder Group, in its capacity
as such, is aware of and has consented to K&E's simultaneous
representation of each other member of the Ad Hoc Noteholder
Group.
No member of the Ad Hoc Noteholder Group represents or purports to
represent any other entities in connection with the Debtors'
Chapter 11 cases.
Co-Counsel for the Ad Hoc Noteholder Group:
Domenic E. Pacitti, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
919 N. Market Street, Suite 1000
Wilmington, DE 19801
Telephone: (302) 426-1189
Facsimile: (302) 426-9193
- and -
Morton Branzburg, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
1835 Market Street, Suite 1400
Philadelphia, PA 19103
Telephone: (215) 569-2700
Facsimile: (215) 568-6603
- and -
Joshua A. Sussberg, P.C.
Matthew R. Kapitanyan, Esq.
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
- and -
David L. Eaton, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
About Swift Energy
Headquartered in Houston, Texas, Swift Energy Company is an
independent energy company engaged in the exploration, development,
production and acquisition of oil and natural gas properties. Its
primary assets and operations are focused in the Eagle Ford trend
of South Texas and the onshore and inland waters of Louisiana.
Swift Energy Company and eight of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 15-12669 to
15-12677) on Dec. 31, 2015. The petitions were signed by Alton D.
Heckaman, Jr., the executive vice president and CFO. Judge Mary
F. Walrath has been assigned the cases.
The Debtors disclosed total assets of $1.02 billion and total debt
of $1.34 billion as of Sept. 30, 2015.
The Debtors engaged Jones Day as general counsel; Richards, Layton
& Finger, P.A., as local counsel; Lazard Freres & Co, LLC as
investment banker; Alvarez & Marsal North America LLC as financial
advisor; and Kurtzman Carson Consultants LLC as claims and
noticing agent.
SWIFT ENERGY: U.S. Needs to Know If Sale Includes Federal Assets
----------------------------------------------------------------
BankruptcyData reported that the United States, on behalf of the
Department of Interior and through the Office of Natural Resources
Revenue and the Bureau of Land Management, filed with the U.S.
Bankruptcy Court an objection to Swift Energy's motion for an order
(a) approving the sale of certain of the Debtors' Louisiana assets;
(b) approving the assumption, assignment and sale of certain
contracts and unexpired leases and (c) granting related relief.
The objection explains, "It is unclear whether the assets to be
sold pursuant to the Sale Motion include federal interests. The
Sale Motion does not identify any Interior or other federal
interests as interests that are being sold.
The Interior has requested information from the Debtors about
whether the sale includes federal interests and the Debtors have
responded that they do not think that such interests are being
assigned. However, Interior's preliminary research indicates that
Swift Energy Operating, has at least 25 leases with Interior
located on property in Louisiana.
The United States objects to the lack of notice provided by the
Sale Motion process. The United States does not have an adequate
amount of time to research its records to independently determine
the impact, if any; the Sale Motion has on federal interests.
Interior is diligently searching its records and its records
reflect that the Debtors have a multitude of federal agreements
with the government. The objection is based on the best
information presently available."
About Swift Energy
Headquartered in Houston, Texas, Swift Energy Company is an
independent energy company engaged in the exploration,
development,
production and acquisition of oil and natural gas properties. Its
primary assets and operations are focused in the Eagle Ford trend
of South Texas and the onshore and inland waters of Louisiana.
Swift Energy Company and eight of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Case Nos. 15-12669 to
15-12677) on Dec. 31, 2015. The petitions were signed by Alton D.
Heckaman, Jr., the executive vice president and CFO. Judge Mary
F.
Walrath has been assigned the cases.
The Debtors disclosed total assets of $1.02 billion and total debt
of $1.34 billion as of Sept. 30, 2015.
The Debtors engaged Jones Day as general counsel; Richards, Layton
& Finger, P.A., as local counsel; Lazard Freres & Co, LLC as
investment banker; Alvarez & Marsal North America LLC as financial
advisor; and Kurtzman Carson Consultants LLC as claims and
noticing agent.
TATUADO HOSPITALITY: Case Summary & 18 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Tatuado Hospitality Management Group, LLC
581 East Sunset Road, Suite 100
Henderson, NV 89011
Case No.: 16-10460
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Hon. August B. Landis
Debtor's Counsel: Samuel A. Schwartz, Esq.
SCHWARTZ FLANSBURG PLLC
6623 Las Vegas Blvd. SO., STE 300
Las Vegas, NV 89119
Tel: (702) 385-5544
Fax: (702) 385-2741
Email: sam@nvfirm.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Michael F. Tsunis, manager.
A list of the Debtor's 18 largest unsecured creditors is available
for free at http://bankrupt.com/misc/nvb16-10460.pdf
TERRESTAR CORP: Court Refuses to Review Dismissal of "Perez" Suit
-----------------------------------------------------------------
Before the United States Bankruptcy Court for the Southern District
of New York is the motion of Plaintiff Aldo Ismael Perez for
reconsideration of the Court's decision to dismiss the adversary
proceeding he filed against Terrestar Corporation.
In a Memorandum of Decision dated January 15, 2016, which is
available at http://is.gd/MfIxh5from Leagle.com, Judge Sean H.
Lane of the United States Bankruptcy Court for the Southern
District of New York denied the motion.
According to Judge Lane, Mr. Perez does not satisfy the standard
for relief under either Rule 59(e) or Rule 60(b). In his Motion,
Mr. Perez repeats and discusses the same arguments previously
presented in his opposition to the TSC Debtors' motion to dismiss
the adversary proceeding, including his allegations that the TSC
Debtors fabricated venue, that TSC concealed or failed to disclose
the identity of insiders or "control persons," and numerous
arguments relating to the valuation of and transactions surrounding
the 1.4 GHz, 1.6 GHz and 2.0 GHz spectrum. Additionally, Mr. Perez
arguably raises several other specific arguments that could have
but were not asserted in his opposition to the motion to dismiss,
including his complaint that he was not provided with a meaningful
opportunity to cross-examine Mr. Zelin at the Confirmation Hearing,
Judge Lane noted.
The adversary proceeding is ALDO ISMAEL PEREZ, Plaintiff, v.
TERRESTAR CORPORATION, et al., Defendants, Adv. Proc. No. 13-01334
(SHL)(Bankr. S.D.N.Y.).
The bankruptcy case is In re: TERRESTAR CORPORATION, et al.,
Chapter 11, Debtors, Case No. 11-10612 (SHL) Jointly Administered
(Bankr. S.D.N.Y.).
Aldo Ismael Perez, Plaintiff, is represented by Juan C. Zorrilla,
Esq. -- jzorrilla@fowler-white.com -- Fowler White Burnett, P.A..
TerreStar Corporation, et al., Defendant, is represented by Ira S.
Dizengoff, Esq. -- idizengoff@akingump.com -- Akin, Gump, Strauss,
Hauer & Feld, LLP.
About TerreStar Corp.
TerreStar Corporation and TerreStar Holdings, Inc., filed
voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for
the Southern District of New York on Feb. 16, 2011.
TSC's Chapter 11 filing joins the bankruptcy proceedings of
TerreStar Networks Inc. and 12 other affiliates, which filed on
Oct. 19, 2010. The October Chapter 11 cases are procedurally
consolidated under TSN's Case No. 10-15446 under Judge Sean H.
Lane.
TSC is the parent company of each of the October Debtors. TSC has
four wholly owned direct subsidiaries: TerreStar Holdings, Inc.,
TerreStar New York Inc., Motient Holdings Inc., and MVH Holdings
Inc.
TSC's case is jointly administered with the cases of seven of the
October Debtors under the caption In re TerreStar Corporation, et
al., Case No. 11-10612 (SHL). The seven Debtor entities who
sought joint administration with TSC are TerreStar New York Inc.,
Motient Communications Inc., Motient Holdings Inc., Motient
License Inc., Motient Services Inc., Motient Ventures Holdings
Inc., and MVH Holdings Inc.
TSC is a Delaware corporation whose main asset is the equity in
non-Debtor TerreStar 1.4 Holdings LLC, which has the right to use
a "1.4 GHz terrestrial spectrum" pursuant to 64 licenses issued by
the Federal Communication Commission. TSC also has an indirect
89.3% ownership interest in TerreStar Network, Inc., which
operates a separate and distinct mobile communications business.
TerreStar Holdings is a Delaware corporation that directly holds
100% of the interests in 1.4 Holdings LLC.
TerreStar Networks -- TSN -- the principal operating entity of
TSC, developed an innovative wireless communications system to
provide mobile coverage throughout the United States and Canada
using satellite-terrestrial smartphones. The system, however,
required an enormous amount of capital expenditures and initially
produced very little in the way of revenue. TSN's available cash
and borrowing capacity were insufficient to cover its funding;
thus, forcing TSN to seek bankruptcy protection in October 2010.
TSC estimated assets and debts of $100 million to $500 million in
its Chapter 11 petition.
Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP,
in New York, serves as counsel for the TSC and TSN Debtors.
Garden City Group is the claims and notice agent. Blackstone
Advisory Partners LP is the financial advisor. The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.
Otterbourg Steindler Houston & Rosen P.C. is the counsel to the
Official Committee of Unsecured Creditors formed in TSN's Chapter
11 cases. FTI Consulting, Inc., is the Committee's financial
advisor.
TerreStar Networks sold its business to Dish Network Corp. for
$1.38 billion. It canceled a June 2011 auction because there were
no competing bids submitted by the deadline.
TerreStar Networks previously filed a reorganization plan that
called for secured noteholders to swap more than $850 million in
debt for nearly all the equity in reorganized TerreStar. Junior
creditors, however, would see little recovery under that plan
while existing equity holders would be wiped out. TerreStar
Networks scrapped that plan in 2011 in favor of the auction.
In November 2011, TerreStar Networks filed a liquidating
Chapter 11 plan after striking a settlement with creditors. The
creditors' committee initiated lawsuits in July to enhance the
recovery by unsecured creditors.
Judge Lane approved on Feb. 14, 2012, TerreStar Networks Inc.'s
Chapter 11 plan to divvy up the proceeds from the sale to Dish
Network.
THELEN LLP: Gets Approval of $4M Settlement Over Terminations
-------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that a New York
bankruptcy judge on Jan. 27, 2016, signed off on a $4 million
settlement that would resolve a class action lawsuit brought by
former Thelen LLP employees who claim that the San Francisco-based
firm violated state and federal laws when they were abruptly
terminated months before the law firm collapsed in 2008.
The deal, given initial approval by U.S. Bankruptcy Judge Michael
Wiles, would resolve legal claims brought on behalf of a class of
approximately 700 former Thelen employees. The lawsuit was filed in
California.
About Thelen LLP
Thelen LLP, formerly known as Thelen Reid Brown Raysman & Steiner
-- http://thelen.com/-- is a bi-coastal American law firm in
process of dissolution. It was formed as a product between two
mergers between California and New York-based law firms, mostly
recently in 2006. Its headcount peaked at roughly 600 attorneys
in 2006, and had 500 early in 2008, with offices in eight cities
in the United States, England and China.
In October 2008, Thelen's remaining partners voted to dissolve the
firm. As reported by the Troubled Company Reporter on Sept. 22,
2009, Thelen LLP filed for Chapter 7 protection. The filing was
expected due to the timing of a writ of attachment filed by one of
Thelen's landlords, entitling the landlord to $25 million of the
Company's assets. The landlord won approval for that writ in June
2009, but Thelen could void the writ by filing for bankruptcy
within 90 days of that court ruling. Thelen, according to AM Law
Daily, has repaid most of its debt to its lending banks.
TORQUED UP: Can Continue IPFS Insurance Premium Financing Deal
--------------------------------------------------------------
U.S. Bankruptcy Judge Bill Parker has authorized Torqued-Up Energy
Services, Inc., to continue an insurance premium finance agreement
with IPFS Corporation.
In the ordinary course of business, the Debtor must maintain
various insurance policies in order to continue its operations.
The Debtors chose to finance the payment of the premiums and on
April, 2, 2015, entered into a Premium Finance Agreement with IPFS
Corporation.
The total premium for the required insurance coverage was
$1,563,444. The Debtor made a down payment of $343,958 requiring
the sum of $1,219,486 to be financed. The insurance coverage was
for a period of one year and the premium financing was spread over
the term of the coverage.
The agreement calls for a monthly payment of $123,604 due on the
1st day of each month during the term of the agreement with the
first payment being made on May 1, 2015, and bears interest at the
rate of 2.95% per annum. However, because of reductions in
property covered, the actual monthly payment is $117,000.
The Debtor engaged in discussions with various companies in the
business of providing insurance premium financing and determined
that IPFS Corporation offered the most advantageous terms for such
financing. The insurance policies identified in the Insurance
Agreement are crucial to the operation of the Debtor's business and
cannot be maintained without the relief requested.
To secure the payment of amounts due, the Insurance Agreement
grants IPFS Corporation a lien and security interest in any and all
unearned or returned premiums which may become payable under the
policies identified in the Insurance Agreement. IPFS Corporation's
lien and security interest in such premiums shall be senior to the
rights of the Debtor's Estate in this and any subsequent proceeding
under the Bankruptcy Code and to the rights of any person claiming
a lien or security interest in any assets of the Debtor.
The Insurance Agreement also assigns to IPFS Corporation a lien and
security interest in loss payment under the policies but only to
the extent such loss payments would reduce the unearned premiums.
The Debtor requests that IPFS Corporation's lien and security
interests in such payments shall be senior to the rights of the
Debtor's estate in this or any subsequent proceeding under the
Bankruptcy Code, but will be subject to the interest of any
mortgagees or other payees.
In the event a default by the Debtor in making the monthly payments
under the Insurance Agreement, but subject to 10 days' prior notice
to Debtor and Debtor's right to cure, the Insurance Agreement
allows IPFS Corporation to cancel the insurance policies identified
in the Insurance Agreement and apply to the Debtor's account the
unearned or returned premiums; and, subject to the rights of loss
payees, any loss payments which would reduce the unearned
premiums.
About Torqued-Up Energy
Torqued-Up Energy Services, Inc., Arctic Acquisition Corporation
and Torqued-up Enterprises, LLC filed Chapter 11 bankruptcy
petitions (Bankr. E.D. Tex. Case Nos. 15-60796, 15-60798, and
15-60799, respectively) on Nov. 24, 2015. The petition was signed
by Kelly W. Prentiss as CEO. The Debtors estimated both assets and
liabilities in the range of $10 million to $50 million. Ireland,
Carroll, & Kelley and Searcy & Searcy, P.C. serve as the Debtors'
counsel. Judge Bill Parker has been assigned the case.
Arctic and Enterprises, while non-operating, are guarantors on debt
to the senior secured lenders and have pledged assets to secure
that debt.
As of Oct. 9, 2015, the Company had on hand the sum of
approximately $1.2 million in cash. The Debtor also owns
approximately $3 million in outstanding accounts receivables of
which approximately $1.5 million is collectible.
The Company's other non-insider, third-party debt is approximately
$1.5 million as of Oct. 9, 2015, consisting largely of
approximately 41 capital leases.
The Company has unsecured subordinated debt which has been advanced
by one or more equity owners over time. That sub-debt is
contractually subordinated to the secured debt of the Banks and as
of Oct. 9, 2015, totals in the amount of $32.5 million. No
interest or other payments have been made on the sub-debt.
TORQUED UP: Can Pay Severance for Retained Employees
----------------------------------------------------
U.S. Bankruptcy Judge Bill Parker has authorized Torqued-Up Energy
Services, Inc., to pay severance for retained employees.
The Debtor's operating assets consist, in part, of approximately
345 pieces of rolling stock and other specialized equipment spread
over a broad geographical area. The remaining 18 employees are
necessary to collect, stack and maintain that equipment pending a
Court approved sale and formal transfer of title. This is not an
easy task and requires not only field personnel but accounting and
management personnel to conduct not only the field activities, but
to collect accounts receivable, maintain business records and to
comply with all of the filing and reporting requirements of a
Chapter 11 debtor until such time as the Chapter 11 may be
terminated.
Many of the remaining 18 employees have offers of other employment
and need to make the determination as to whether to remain
temporarily with Debtor for the purpose of accomplishing the sale
and wind-up of the corporation or whether to leave immediately for
longer term employment. If such employees choose to leave, the
Debtor's estate will be adversely impacted in that the equipment's
value may suffer, resulting in a lower net return to the estate.
The Debtor is of the opinion that these payments are both
reasonable and necessary for the purpose of maintaining the value
of the Debtor's estate and that if such severance payments are not
granted, that the value of the Debtor's estate will suffer
disproportionately to the amount sought to be expended on such
severance payments. The severance payments are based upon the
following criteria:
a. Employees who stay for a period of 30 days after the
bankruptcy filing will receive severance pay equal to one month
regular compensation.
b. Employees who stay through closing of the proposed sale of
assets will receive severance pay equal to three months regular
compensation.
c. Kelly Prentiss will be entitled to receive six (6) months of
regular compensation if the Banks receive at least $8 million as a
result of the asset sale, five months regular compensation if the
Banks receive at least $7.5 million as a result of the asset sale
and four months regular compensation if the Banks receive
$7 million as a result of the asset sale.
About Torqued-Up Energy
Torqued-Up Energy Services, Inc., Arctic Acquisition Corporation
and Torqued-up Enterprises, LLC filed Chapter 11 bankruptcy
petitions (Bankr. E.D. Tex. Case Nos. 15-60796, 15-60798, and
15-60799, respectively) on Nov. 24, 2015. The petition was signed
by Kelly W. Prentiss as CEO. The Debtors estimated both assets and
liabilities in the range of $10 million to $50 million. Ireland,
Carroll, & Kelley and Searcy & Searcy, P.C. serve as the Debtors'
counsel. Judge Bill Parker has been assigned the case.
Arctic and Enterprises, while non-operating, are guarantors on debt
to the senior secured lenders and have pledged assets to secure
that debt.
As of Oct. 9, 2015, the Company had on hand the sum of
approximately $1.2 million in cash. The Debtor also owns
approximately $3 million in outstanding accounts receivables of
which approximately $1.5 million is collectible.
The Company's other non-insider, third-party debt is approximately
$1.5 million as of Oct. 9, 2015, consisting largely of
approximately 41 capital leases.
The Company has unsecured subordinated debt which has been advanced
by one or more equity owners over time. That sub-debt is
contractually subordinated to the secured debt of the Banks and as
of Oct. 9, 2015, totals in the amount of $32.5 million. No
interest or other payments have been made on the sub-debt.
TORQUED-UP ENERGY: Taps Gollob as Certified Public Accountant
-------------------------------------------------------------
Torqued-Up Energy Services, Inc., et al., ask the U.S. Bankruptcy
Court for the Eastern District of Texas for permission to employ
Gollob Morgan Peddy, PC, as certified public accountants.
The normal hourly billing rates of professionals with primary
responsibilities in the case are:
Kevin R. Cashion $220
Dianne Johnston $185
Pamela Nash $145
The firm has requested for a retainer of $15,250 to be held in
trust.
To the best of the Debtors' knowledge, the firm, its members and
associates, do not hold or represent any interest adverse to that
of the Debtors' estates with respect to the matter for which
their employment is sought.
The firm can be reached at:
Gollob Morgan Peddy, PC
c/o Kevin R. Cashion
1001 ESE Loop 323, Suite 300
Tyler, Texas 75701
Tel: (903) 534-0088
Cell: (903) 521-2177
E-mail: kevin@gmpcpa.com
About Torqued-Up Energy
Torqued-Up Energy Services, Inc., Arctic Acquisition Corporation
and Torqued-up Enterprises, LLC filed Chapter 11 bankruptcy
petitions (Bankr. E.D. Tex. Case Nos. 15-60796, 15-60798, and
15-60799, respectively) on Nov. 24, 2015. The petition was signed
by Kelly W. Prentiss as CEO. The Debtors estimated both assets
and
liabilities in the range of $10 million to $50 million. Ireland,
Carroll, & Kelley and Searcy & Searcy, P.C. serve as the Debtors'
counsel. Judge Bill Parker has been assigned the case.
Arctic and Enterprises, while non-operating, are guarantors on TUES
debt to the senior secured lenders and have pledged assets to
secure that debt.
As of Oct. 9, 2015, the Company had on hand the sum of
approximately $1.2 million in cash. The Debtor also owns
approximately $3 million in outstanding accounts receivables of
which approximately $1.5 million is collectible.
The Company's other non-insider, third-party debt is approximately
$1.5 million as of Oct. 9, 2015, consisting largely of
approximately 41 capital leases.
The Company has unsecured subordinated debt which has been
advanced
by one or more equity owners over time. That sub-debt is
contractually subordinated to the secured debt of the Banks and as
of Oct. 9, 2015, totals in the amount of $32.5 million. No
interest or other payments have been made on the sub-debt.
TRI STATE TRUCKING: First Citizens Asks Court to Lift Stay
----------------------------------------------------------
First Citizens Community Bank asked a bankruptcy court to lift the
automatic stay that has prevented the bank from seizing the
vehicles that were used as collateral for the loan it extended to
Water Haulers Inc.
Water Haulers obtained a $476,000 loan from the bank which it used
to purchase the vehicles. The company leased out these vehicles to
Tri State Trucking Co., which is required under the lease to pay
directly to the bank.
Tri State has allegedly failed to make payments since August 31,
2015, according to court filings.
Tri State on Oct. 13, 2015, filed for Chapter 11 protection in the
U.S. Bankruptcy Court for the Middle District of Pennsylvania.
Under U.S. bankruptcy law, the filing of a bankruptcy case triggers
an injunction against the continuance of an action by any creditor
against the debtor or its property. The automatic stay gives the
debtor protection from its creditors subject to the oversight of
the bankruptcy judge.
The court will hold a hearing on Feb. 19 to consider the motion.
Objections are due by Feb. 7.
About Tri State Trucking
Tri State Trucking Company filed Chapter 11 bankruptcy petition
(Bankr. M.D. Pa. Case No. 15-04444) on Oct. 13, 2015. William E.
Robinson signed the petition as president. The Debtor estimated
assets in the range of $10 million to $50 million and liabilities
of at least $1 million. Mette, Evans, & Woodside represents the
Debtor as counsel. Judge John J Thomas is assigned to the case.
Tri State operates an over the road logistics company hauling
various freight of its customers. The Debtor employs approximately
50 people and operates from its headquarters located at 16064 Route
6, Mansfield, Pennsylvania 16933.
The U.S. trustee overseeing the Debtor's case appointed three
creditors to the official committee of unsecured creditors. Cole
Schotz P.C. represents the committee.
TRIGEANT HOLDINGS: BTB Refining's Suit vs. Gravity Midstream Junked
-------------------------------------------------------------------
In an Order dated January 15, 2016, which is available at
http://is.gd/YeFG4Sfrom Leagle.com, Judge Erik P. Kimball of the
United States Bankruptcy Court for the Southern District of
Florida, West Palm Beach Division, granted Defendant Gravity
Midstream Corpus Christi, LLC's Motion to Dismiss the Amended
Complaint and dismissed Count IV (tortious interference with
contract).
Judge Kimball held that BTB Refining, LLC, may file an amended
complaint consistent with his order no later than fourteen (14)
days after entry of the order.
The claims presented in the adversary proceeding against Gravity
Midstream have been released under the terms of a final,
non-appealable order of the Court confirming a chapter 11 plan in
the jointly administered cases and in the plan confirmed thereby,
Judge Kimball held. In addition, the plaintiff's claim for
tortious interference is not supported by a single concrete factual
allegation, Judge Kimball further held.
The adversary proceeding is BTB REFINING, LLC, Plaintiff, v.
TRIGEANT, LTD, BERRY GP, INC., BERRY CONTRACTING, L.P. d/b/a BAY,
LTD., and GRAVITY MIDSTREAM CORPUS CHRISTI, LLC, Defendants, Adv.
Proc. No. 15-01634-EPK(Bankr. S.D. Fla.).
The bankruptcy case is In re: TRIGEANT HOLDINGS, et al., Chapter
11, Debtors, Case No. 14-29027-EPK, Jointly Administered (Bankr.
S.D. Fla.).
BTB Refining, LLC, Plaintiff, is represented by Vincent F
Alexander, Esq. -- vfa@kttlaw.com -- Kozyak Tropin & Throckmortonm,
David L Rosendorf, Esq.-- dlr@kttlaw.com -- Kozyak Tropin &
Throckmorton, Charles W Throckmorton, Esq.-- cwt@kttlaw.com --
Kozyak Tropin & Throckmorton
Trigeant, Ltd., Defendant, represented by Charles H Lichtman, Esq.
-- clichtman@bergersingerman.com -- Berger Singerman LLP
Berry GP, Inc., Defendant, represented by Ernest W. Boyd, Esq.,
Andrea S. Hartley, Esq. –- Akerman LLP
About Trigeant Holdings
Trigeant, owner of a Corpus Christi, Texas oil refinery, provides
fuel and asphalt products to the housing and transportation
industries. The company is owned by Palm Beach, Florida
billionaire Harry Sargeant III and members of his family.
On Nov. 26, 2014, Trigeant filed its first bankruptcy In re
Trigeant Ltd., 13-38580. The case was dismissed on April 1, 2014.
Trigeant Holdings, Ltd., and Trigeant, LLC, filed Chapter 11
bankruptcy petitions (Bankr. S.D. Fla. Case Nos. 14-29027 and
14-29030, respectively) on Aug. 25, 2014, amid a dispute among
members of the Sargeant family. Mr. Sargeant's two brothers,
Daniel and James, and his father, Harry Sargeant II, sent Trigeant
to bankruptcy to fend off Mr. Sargeant III's bid to seize control
of the company's primary asset. The family says Mr. Sargeant III,
who has a $22 million lien against the plant through a company he
controls called BTB Refining LLC, is attempting to prevent the
refinery from operating in an effort to lower its value and obtain
ownership of it.
Trigeant Holdings estimated both assets and liabilities of
$50 million to $100 million.
Berger Singerman LLP serves as the Debtors' counsel.
The Bankruptcy Court set the general claims bar date as Oct. 17,
2014, and March 31, 2015, as the deadline by which governmental
entities must file proofs of claims.
The Debtors filed on Sept. 16, 2014, their Joint Plan of
Reorganization under Chapter 11 of the Bankruptcy Code. The Plan
is premised on the sale of substantially all of the Debtors'
assets to Gravity Midstream Corpus Christi, LLC. The Plan
provides that holders of Allowed Claims will be paid in full, in
cash.
The U.S. Trustee for Region 21 has not appointed a committee of
unsecured creditors.
* * *
Trigeant Holdings, Ltd., et al., notified the U.S. Bankruptcy
Court
for the Southern District of Florida that the Effective Date of
their Third Amended Joint Plan of Reorganization occurred on June
5, 2015.
TRUMP ENTERTAINMENT: 3rd Cir. Affirms Order Rejecting Union's CBA
-----------------------------------------------------------------
UNITE HERE Local 54 appeals the Bankruptcy Court's order granting
Trump Entertainment Resorts, Inc., and its affiliated debtors'
motion to reject their CBA with the Union.
The Union contends that the Bankruptcy Court lacked subject matter
jurisdiction to approve the Debtors' motion because the CBA had
expired. The Debtors, Trump Entertainment Resorts, Inc., and its
affiliated debtors, contend that Section 1113(c) of the Bankruptcy
Code governs all CBAs, expired and unexpired, and that the
Bankruptcy Court's interpretation of Section 1113 is consistent
with the policies underlying the Bankruptcy Code.
The question before the court is whether Section 1113 authorizes a
Chapter 11 debtor to reject the continuing terms and conditions of
a CBA after its expiration. Two statutory schemes are at issue: the
NLRA and Chapter 11 of the Bankruptcy Code.
In an Opinion dated January 15, 2016 which is available at
http://is.gd/PvYyRzfrom Leagle.com, the United States Court of
Appeals for the Third Circuit affirmed the judgment of the
Bankruptcy Court.
The Third Circuit concludes that Section 1113 does not distinguish
between the terms of an unexpired CBA and the terms and conditions
that continue to govern after the CBA expires.
The case is IN RE: TRUMP ENTERTAINMENT RESORTS UNITE HERE Local 54,
Appellant, No. 14-4807.
Kathy L. Krieger, Esq. -- klkrieger@jamhoff.com -- James & Hoffman,
Darin M. Dalmat, Esq. -- ddalmat@jamhoff.com -- James & Hoffman,
Evin F. Isaacson, Esq. -- eisaacson@jamhoff.com -- James & Hoffman,
1130 Connecticut Avenue, N.W., Suite 950, Washington, DC 20001,
William T. Josem, Esq. -- wtjosem@cjtlaw.org -- Cleary, Josem &
Trigiani, 325 Chestnut Street, Constitution Place, Suite 200,
Philadelphia, PA 19106, Counsel for Appellant.
Roy T. Englert, Jr., Esq. -- renglert@robbinsrussell.com --
Robbins, Russell, Englert, Orseck, Untereiner & Saube, Joshua S.
Bolian, Esq. -- jbolian@robbinsrussell.com -- Robbins, Russell,
Englert, Orseck, Untereiner & Sauber, 1801 K Street, NW, Suite
411-L, Washington, DC 20006, Counsel for Appellees Trump,
Entertaiment Resorts Inc, TER, Development Co LLC, TERH LLP Inc.,
Trump Entertainment Resorts, Development Company LLC, Trump,
Entertainment Resorts Holdings LP, Trump Marina Associates, Trump
Plaza, Associates LLC and Trump Taj Mahal, Associates.
About Trump Entertainment
Based in Atlantic City, New Jersey, Trump Entertainment Resorts
Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and
operates three casino hotel properties in Atlantic City, New
Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza
Hotel and Casino, and Trump Marina Hotel Casino. The Company
conducts gaming activities and provides customers with casino
resort and entertainment.
Donald Trump is a shareholder of the Company and, as its non-
executive Chairman, is not involved in the daily operations of the
Company. The Company is separate and distinct from Mr. Trump's
privately held real estate and other holdings.
Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other
affiliates filed for Chapter 11 protection on Feb. 17, 2009
(Bankr. D. N.J. Lead Case No. 09-13654). The Company tapped
Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as
lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst &
Young LLP served as the Company's auditor and accountant and
Lazard Freres & Co. LLC was the financial advisor. Garden City
Group was the claims agent. The Company disclosed assets of
$2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008.
Trump Hotels & Casino Resorts, Inc., filed for Chapter 11
protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898
through 04-46925). Trump Hotels obtained the Court's confirmation
of its Chapter 11 plan on April 5, 2005, and in May 2005, it
exited from bankruptcy under the name Trump Entertainment Resorts
Inc.
* * *
The Troubled Company Reporter, on March 19, 2015, reported that
Judge Kevin Gross of the U.S. Bankruptcy Court for the District of
Delaware confirmed Trump Entertainment Resorts, Inc., et al.'s
Third Amended Joint Plan of Reorganization and Disclosure Statement
pursuant to Section 1129 of the Bankruptcy Code.
The Debtors filed on January 5, 2015, the Plan and accompanying
Disclosure Statement to, among other things, provide that holders
of General Unsecured Claims will receive Distribution Trust
Interests, which will include $1 million in cash and the proceeds,
if any, of certain avoidance actions. Under the revised plan,
holders of general unsecured claims are estimated to recover 0.47%
to 0.43% of their total allowed claim amount. The Amended Plan
also includes language reflecting the recently-approved $20 million
loan from Carl Icahn.
TTJ ENTERPRISES: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: TTJ Enterprises, LLC
7266 Tom Drive, Suite 200
Baton Rouge, LA 70806
Case No.: 16-10112
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Middle District of Louisiana (Baton Rouge)
Debtor's Counsel: Noel Steffes Melancon, Esq.
STEFFES, VINGIELLO & MCKENZIE, LLC
13702 Coursey Blvd., Building 3
Baton Rouge, LA 70817
Tel: 225-751-1751
Fax: 225-751-1998
Email: nmelancon@steffeslaw.com
- and -
William E. Steffes, Esq.
STEFFES, VINGIELLO & MCKENZIE, LLC
13702 Coursey Boulevard, Building 3
Baton Rouge, LA 70817
Tel: 225-751-1751
Fax: 225-751-1998
Email: bsteffes@steffeslaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by James Taylor Jeansonne, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
TWIN RIVER: S&P Raises Rating on $520MM Facility to 'BB'
--------------------------------------------------------
Standard & Poor's Ratings Services raised its issue-level rating on
Rhode Island-based gaming operator Twin River Worldwide Holdings
Inc.'s $520 million senior secured credit facility one notch to
'BB' from 'BB-'. S&P also revised its recovery rating on the
credit facility to '2' from '3'. The '2' recovery rating reflects
S&P's expectation for substantial recovery (70% to 90%; lower half
of the range) for lenders in the event of a payment default. Twin
River repaid an additional $31 million of debt in the fourth
quarter of 2015, resulting in a lower level of debt outstanding at
default than S&P previously assumed in its default scenario and
improved recovery prospects.
S&P's 'BB-' corporate credit rating on Twin River is unchanged. The
rating outlook is stable.
RECOVERY ANALYSIS
Key analytical factors
S&P's simulated default scenario contemplates a payment default in
2020, reflecting a substantial decline in cash flow resulting from
increased competition from new casinos in Massachusetts, as well as
from existing casinos and new casinos in Connecticut, and a
prolonged economic downturn. S&P assumes a reorganization
following the default.
Simulated default assumptions
-- Year of default: 2020
-- EBITDA at emergence: $55 mil.
-- EBITDA multiple: 6.5x
Simplified waterfall
-- Net enterprise value (after 3% admin. costs): $347 mil.
---------------------------------------------
-- Secured debt: $457.5 mil.
-- Recovery expectation: 70% to 90% (lower half of range)
Note: All debt amounts include six months of prepetition interest.
RATINGS LIST
Twin River Worldwide Holdings Inc.
Corporate Credit Rating BB-/Stable/--
Upgraded; Recovery Rating Revised
Twin River Worldwide Holdings Inc.
To From
Senior Secured BB BB-
Recovery Rating 2L 3H
ULTRA PETROLEUM: S&P Lowers CCR to 'CCC-', Outlook Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered the corporate credit
rating on Houston-based oil and gas exploration and production
(E&P) company Ultra Petroleum Corp. to 'CCC-' from 'B+', given
S&P's view that the company may look to restructure its debt over
the next six months. The outlook is negative. At the same time,
S&P lowered its issue-level rating on the company structurally
subordinated unsecured debt to 'C' from 'B+'
"The rating action reflects our view that Ultra Petroleum's
leverage and liquidity continue to deteriorate in light of our
recently reduced commodity price deck and our estimate that the
company will breach financial covenants on both its unsecured
credit facility and senior unsecured notes at the end of the first
quarter," said Standard & Poor's credit analyst Carin Dehne-Kiley.
The covenant breach would be considered an event of default and
would accelerate maturities on $2.1 billion of outstanding debt
(based on the $648 million outstanding on its revolver as of
Sept. 30, 2015). As a result, S&P has revised its assessment of
liquidity to weak from less than adequate. In S&P's view, to avoid
a default, it believes the company could look to restructure or
announce a debt exchange that S&P would view as distressed.
S&P's ratings on Ultra reflect S&P's view of the company's fair
business risk, highly leveraged financial risk, and weak liquidity.
The negative outlook primarily reflects S&P's view that Ultra
Petroleum will breach its leverage covenant at the end of the first
quarter, and could restructure its debt or announce a distressed
exchange within the next six months.
S&P could raise the rating if Ultra Petroleum were able to obtain
covenant waivers or amendments on its debt and extend the maturity
of its credit facility.
US STEEL CANADA: Commences Sale & Investment Solicitation Process
-----------------------------------------------------------------
U.S. Steel Canada Inc. on Feb. 1 disclosed that it is commencing a
sale and investment solicitation process (the "SISP") pursuant to a
court order dated January 13, 2016 (the "SISP Order"). USSC
obtained an initial order (as amended and restated, the "Initial
Order") under the Companies' Creditors Arrangement Act (Canada)
("CCAA") from the Ontario Superior Court of Justice, Commercial
List (Toronto) (the "Court") on September 16, 2014. Pursuant to
the Initial Order, USSC is authorized to pursue all avenues of a
sale or refinancing of its business or property, in whole or part,
subject to prior approval of the Court.
USSC is a two-site leading integrated steel producer whose assets
include blast furnace operations, coke ovens, steelmaking
facilities, and hot-rolling, pickling, cold-rolling, and
galvanizing lines. In addition to the currently operating assets,
USSC assets include certain idled production equipment which could
be restarted.
The SISP is intended to solicit interest in and opportunities for a
sale, restructuring or recapitalization of USSC's assets and
business operations (the "Opportunity"). The Opportunity may
include one or more of a restructuring, recapitalization or other
form of reorganization of the business and affairs of USSC as a
going concern, or a sale of all, substantially all, or one or more
components of USSC's assets (the "Property") and business
operations (the "Business") including, without limitation:
USSC's 813 acres of real property located on Hamilton Harbour in
Hamilton, Ontario (the "Hamilton Lands"), and coke ovens, assets
used for ironmaking, steelmaking and finishing, and other operating
assets and business operations located in Hamilton, Ontario
("Hamilton Works"); and USSC's 6,600 acres of real property located
in Nanticoke, Ontario, coke ovens, assets used for ironmaking and
steelmaking, hot-rolling, pickling, and other operating assets and
business operations located in Nanticoke, Ontario ("Lake Erie
Works"). Ernst & Young Inc. (the "Monitor") is USSC's Court
appointed Monitor and Rothschild Inc. (the "Financial Advisor") is
USSC's financial advisor.
The SISP will consist of two phases. In Phase 1, parties who have
entered into a non-disclosure agreement ("NDA") in the form
provided by USSC or otherwise acceptable to the Financial Advisor,
USSC and the Monitor will be provided with information considered
relevant to the Opportunity (the "Confidential Information
Package") and the opportunity to submit a non-binding letter of
interest ("LOI") by no later than 5:00 PM (Eastern Time) on or
before February 29, 2016 offering to (i) acquire all, substantially
all or a portion of the Property, or (ii) make an investment in,
restructure, reorganize or refinance the Business. As outlined in
the SISP Order, parties that have submitted Qualified LOIs, have a
bona fide interest in completing a sale proposal or investment
proposal with USSC and have the financial capability to consummate
such a transaction may be invited to participate in Phase 2 of the
SISP, which will include detailed due diligence and access to a
confidential data room. The SISP Order provides further details on
the SISP.
Any party who wishes to participate in the SISP (a "Potential
Bidder") must provide to USSC's Financial Advisor an NDA executed
by it and a letter setting forth the identity of the Potential
Bidder, the contact information for such Potential Bidder and full
disclosure of the direct and indirect principals of the Potential
Bidder. Parties who wish to participate in the SISP process should
contact USSC's Financial Advisor at ussc@rothschild.com to receive
an NDA. The SISP will also be subject to the supervision of the
Monitor.
A Potential Bidder (who delivers the executed NDA and letter as set
out above) will be deemed a "Phase 1 Qualified Bidder" if USSC and
the Financial Advisor, in their reasonable business judgment, in
consultation with and with the approval of the Monitor, determine
such person is likely, based on the availability of financing,
experience and other considerations, to be able to consummate a
sale, restructuring or recapitalization transaction pursuant to the
SISP.
Phase 1 Qualified Bidders will be provided with the Confidential
Information Package. The Financial Advisor, USSC, the Monitor and
their respective advisors make no representation or warranty as to
the information contained in the Confidential Information Package
or otherwise made available pursuant to the SISP or otherwise,
except to the extent expressly contemplated in any definitive sale
or investment agreement with a successful bidder ultimately
executed and delivered by USSC.
For further information with respect to the SISP, interested
parties may contact either the Financial Advisor or the Monitor as
set out below:
Financial Advisor
Gideon Volschenk, Director
Rothschild Inc.
(202) 862 1677
ussc@rothschild.com
Monitor
Alex Morrison, Senior Vice President
Ernst & Young Inc.
(416) 941 7743
alex.f.morrison@ca.ey.com
U. S. Steel Canada continues to carry on business as usual while it
develops and implements comprehensive restructuring solutions.
Ernst & Young Inc., as the Court-appointed Monitor continues to
oversee the business and financial affairs of the company during
the CCAA process.
About U.S. Steel Canada, Inc.
U.S. Steel Canada's operations are located at Lake Erie Works, a
fully integrated steelmaking facility, and at Hamilton Works, home
to cokemaking and finishing operations including its
zinc-coating facility, Z-Line. U.S. Steel Canada has the
capability of producing approximately 2.6 million tons of steel
annually and employs approximately 2,000 people.
U.S. Steel Canada commenced court-supervised restructuring
proceedings under the Companies' Creditors Arrangement Act, R.S.C.
1985, c. C-36, before the Ontario Superior Court of Justice
(Commercial List) on Sept. 16, 2014. Ernst & Young Inc. has been
appointed by the CCAA court as monitor pursuant to an Initial CCAA
Order.
UTSA APARTMENTS 5: Case Summary & Largest Unsecured Creditor
------------------------------------------------------------
Debtor: UTSA Apartments 5, LLC
1663 Keleka
Koloa, HI 96756
Case No.: 16-50237
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Western District of Texas (San Antonio)
Judge: Hon. Craig A. Gargotta
Debtor's Counsel: Allen M. DeBard, Esq.
LANGLEY & BANACK, INC
745 E Mulberry, Suite 900
San Antonio, TX 78212
Tel: (210) 736-6600
Fax: (210) 735-6889
Email: adebard@langleybanack.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Daniel C. Booye, member.
The Debtor listed The Woodlark Companies as its largest unsecured
creditor.
A copy of the petition is available for free at:
http://bankrupt.com/misc/txwb16-50237.pdf
UTSA APARTMENTS 6: Case Summary & Largest Unsecured Creditor
------------------------------------------------------------
Debtor: UTSA Apartments 6, LLC
1663 Keleka
Koloa, HI 96756
Case No.: 16-50240
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Western District of Texas (San Antonio)
Judge: Hon. Craig A. Gargotta
Debtor's Counsel: Allen M. DeBard, Esq.
LANGLEY & BANACK, INC
745 E Mulberry, Suite 900
San Antonio, TX 78212
Tel: (210) 736-6600
Fax: (210) 735-6889
Email: adebard@langleybanack.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Lynette L. Booye, member.
The Debtor listed The Woodlark Companies as its largest unsecured
creditor.
A copy of the petition is available for free at:
http://bankrupt.com/misc/txwb16-50240.pdf
VERSO CORP: Feb. 5 Meeting Set to Form Creditors' Panel
-------------------------------------------------------
Andy Vara, Acting United States Trustee of Region 3, will hold an
organizational meeting on Feb. 5, 2016, at 10:00 a.m. in the
bankruptcy case of Verso Corporation, et al.
The meeting will be held at:
Sheraton Suites Wilmington Downtown
422 Delaware Ave.
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
VOGUE BEAUTY STUDIO: Court Denies Bid to Employ Counsel
-------------------------------------------------------
Vogue Beauty Studio, Inc., filed a motion to employ a general
bankruptcy counsel.
Despite the court's rejection of the proposed order with notice
that Counsel was using incorrect motion and order forms not
appropriate for an entity Chapter 11 case, Counsel submitted
another proposed order on the same Motion on behalf of Debtor,
again on a Form F 2081-2.5.ORDER.EMPLOY.GEN.COUNSEL, but altering
the form order in several respects.
In an Order dated January 14, 2016, which is available at
http://is.gd/Qn7Ccofrom Leagle.com, Judge Robert Kwan of the
United States Bankruptcy Court for the Central District of
California, Los Angeles Division, denied without prejudice the
Motion because it is procedurally defective since Counsel has used
incorrect motion and order forms and has submitted an altered
court-approved form in violation of the Local Bankruptcy Rules; and
Counsel is ordered to read Local Bankruptcy Rule 9009-1(b)(4) and
file a declaration with the court stating that he has done so and
has instructed all members of his staff that court-approved forms
may not be altered in violation of Local Bankruptcy Rule
9009-1(b)(4) by January 26, 2016. Failure to timely file this
declaration with the court may result in the imposition of monetary
sanctions against Counsel in the amount of $100.00. Counsel may
request reconsideration of these sanctions within 14 days of the
entry of this order.
In submitting an erroneous form of order, Counsel has not only
failed to heed the court's notification that he was using the
incorrect motion and order forms, but he compounded this failure by
altering the court-approved form of order.
The court admonishes Counsel for using the incorrect motion and
order forms and for altering court-approved forms in violation of
Local Bankruptcy Rule 9009-1(b)(4).
The case is In re: VOGUE BEAUTY STUDIO, INC., Chapter 11, Debtor,
Case No. 2:15-bk-28329-RK.
Vogue Beauty Studio, Inc., Debtor, is represented by Michael Jay
Berger, Esq.
Vogue Beauty Studio, Inc., sought protection under Chapter 11 of
the Bankruptcy Code on Nov. 30, 2015 (Bankr. C.D. Cal. Case No.
15-28329). The Debtor is represented by Michael Jay Berger, Esq.,
at Law Offices of Michael Jay Berger.
WARREN RESOURCES: S&P Lowers Corporate Credit Rating to 'D'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit on
oil and gas exploration and production company Warren Resources
Inc. to 'D' from 'SD' (selective default). The issue-level rating
on the company's unsecured debt remains 'D'. The recovery rating
remains '6', indicating S&P's expectation of negligible (0%-10%)
recovery in the event of a payment default.
The 'D' ratings reflect Warren Resources Inc.'s announcement that
it has missed a $7.5 million interest payment on its outstanding
$300 million 9% notes ($167 million outstanding) due 2022, and
S&P's belief that the company will not make this payment before the
30-day grace period ends. S&P believes that the default will be a
general default and the company will fail to pay all or
substantially all of its obligations as they come due.
The company has also disclosed that it is engaged in ongoing
negotiations with the holders of its outstanding unsecured notes
regarding a potential restructuring, along with possible avenues
for increasing its near-term liquidity.
WATERSCAPE RESORT: Court Grants Pavarini's Summary Judgment Bid
---------------------------------------------------------------
Plaintiff Pavarini McGovern, LLC, moves for partial summary
judgment to dismiss the counterclaim asserted by Defendants
Waterscape Resort LLC, et al., for purportedly misrepresenting that
Pavarini had obtained subguard insurance to protect it from default
by a certain subcontractor. Pavarini also moves for summary
judgment striking the Defendants' second, third, fourth, eleventh,
and twelfth affirmative defenses.
In a Memorandum Decision dated January 14, 2016, which is available
at http://is.gd/AgvqG1from Leagle.com, Judge Stuart M. Bernstein
of the United States Bankruptcy Court for the Southern District of
New York granted Pavarini's summary judgment.
The adversary proceeding is PAVARINI McGOVERN, LLC, Plaintiff,
WATERSCAPE RESORT LLC, et al. Defendants, Adv. Proc. No. 11-02248
(SMB)(Bankr. S.D.N.Y.).
The bankruptcy case is In re: WATERSCAPE RESORT LLC, Chapter 11,
Debtor, Case No. 11-11593 (SMB)(Bankr. S.D.N.Y.).
PAVARINI MCGOVERN, LLC, Plaintiff, is represented by Louis T.
DeLucia, Esq. -- ldelucia@schiffhardin.com -- Schiff Hardin LLP,
Eric W. Sleeper, Esq. -- esleeper@bartonesq.com -- Barton, LLP.
Waterscape Resort LLC, Defendant, is represented by Eric S. Medina,
Esq. -- emedina@medinafirm.com -- Medina Law Firm LLC, Henry A.H.
Rosenzweig, Esq. -- henry.rosenzweig@hklaw.com -- Holland & Knight,
LLP, Karl Silverberg, Esq. -- Silverberg P.C., Lee William Stremba,
Esq. -- lee.stremba@troutmansanders.com -- Troutman Sanders LLP.
About Waterscape Resort
Waterscape Resort LLC, aka Cassa NY Hotel and Residences, filed
for
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No.
11-11593) on April 5, 2011.  Waterscape acquired property
consisting of three contiguous buildings at 66, 68 and 70 West
45th
Street in Manhattan, for the sum of $20 million, and developed the
property into a 45-storey condominium project including a luxury
hotel, a restaurant and luxury residential apartments.  The
purchase was financed with a $17 million acquisition loan and
mortgage from U.S. Bank Association.  The Cassa NY Hotel and
Residences features 165 hotel rooms, and above the hotel units, 57
residences.
Brett D. Goodman, Esq., and Lee William Stremba, Esq., at Troutman
Sanders LLP, represented the Debtor as bankruptcy counsel. Holland
& Knight LLP served as its special litigation counsel. The Debtor
disclosed $214 million in assets and $159 million in liabilities
as
of the Chapter 11 filing.
Schiff Hardin LLP served as counsel to a 3-member Official
Committee of Unsecured Creditors.
U.S. Bankruptcy Judge Stuart Bernstein confirmed Waterscape's
reorganization plan in July 2011, which calls for repaying much of
the company's debt with proceeds from the $128 million sale of
the
hotel section of the development.  The Plan was filed May 6,
2011.
WAVE SYSTEMS: Files for Chapter 7 Protection; Executives Resign
---------------------------------------------------------------
Wave Systems Corp. (NASDAQ: WAVX) commenced a bankruptcy case by
filing a voluntary petition for relief under the provisions of
chapter 7 of the Bankruptcy Code (Bankr. D. Del. Case No.
15-_____).
The Company is represented by Robert S. Brady of Young, Conaway,
Stargatt & Taylor.
BankruptcyData reported that according to documents filed with the
SEC, as a result of the filing of the Chapter 7 filing, a trustee
will be appointed by the and will assume control of the Company.
The assets of the Company will be liquidated in accordance with the
Code.
Wave Systems explains, "The Company's board of directors, after
spending considerable time and effort attempting to pursue and
complete strategic alternatives to finance, restructure or sell the
Company and not being successful, concluded that no viable options
remained for continuing operations, and that the Chapter 7 case is
the only alternative available." Each of the directors and
officers of the Company -- William M. Solms, C.E.O. and president,
and Walter A. Shephard, C.F.O. and secretary -- have resigned their
officer positions and cease to be employees.
The appointment of the Chapter 7 trustee effectively eliminates the
authority and powers of the officers of the Company to act on
behalf of the Company.
About Wave Systems
Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) --
http://www.wave.com/-- develops, produces and markets products for
hardware-based digital security, including security applications
and services that are complementary to and work with the
specifications of the Trusted Computing Group, an industry
standards organization comprised of computer and device
manufacturers, software vendors and other computing products
manufacturers.
Wave Systems reported a net loss of $12.9 million in 2014, a net
loss of $20.3 million in 2013 and a net loss of $34 million in
2012.
WOW ORTHODONTICS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: WOW Orthodontics Inc.
fka WOW Orthodontics LLC
214 Ward Cir Ste 1100A
Brentwood, TN 37027
Case No.: 16-00626
Nature of Business: Health Care
Chapter 11 Petition Date: February 1, 2016
Court: United States Bankruptcy Court
Middle District of Tennessee (Nashville)
Judge: Hon. Marian F Harrison
Debtor's Counsel: Elliott Warner Jones, Esq.
EMERGE LAW PLC
2021 Richard Jones Rd
Suite 240
Nashville, TN 37215
Tel: 615-953-2629
Email: elliott@emergelaw.net
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Wendy Oakes Wilhelm, owner.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
XINERGY LTD: Court Approves Sale of True Energy Assets to A & G
---------------------------------------------------------------
True Energy LLC received court approval to sell most of its assets
to Southern Coal Corp.'s subsidiary.
The order, issued by U.S. Bankruptcy Judge Paul Black, allowed the
company to sell the assets used in its mining operations in
Virginia to A & G Coal Corp., which made a $125,000 cash offer.
A & G will also assume certain liabilities aside from the cash
offer, according to court filings.
The assets to be sold include coal inventory, mobile equipment and
the company's interests in real property leases.
The assets were supposed to be sold in an auction on Jan. 19
pursuant to a court-approved bidding process launched by the
company. A & G, however, was the only bidder that made an offer to
acquire the assets prior to the Jan. 14 deadline.
A copy of the court order is available without charge at
http://bankrupt.com/misc/XINERGY_TELLCSaleOrd012916.pdf
True Energy is a high volatility metallurgical surface mining
operation located in Wise County, Virginia. In July 2011, Xinergy
acquired 100% of the membership interests of True Energy.
About Xinergy Ltd.
Xinergy is a U.S. producer of metallurgical and thermal coal with
mineral reserves, mining operations and coal properties located in
the Central Appalachian ("CAPP") regions of West Virginia and
Virginia. Xinergy's operations principally include two active
mining complexes known as South Fork and Raven Crest located in
Greenbrier and Boone Counties, West Virginia. Xinergy also leases
or owns the mineral rights to properties located in Fayette,
Nicholas and Greenbrier Counties, West Virginia and Wise County,
Virginia. Collectively, Xinergy leases or owns mineral rights to
approximately 72,000 acres with proven and probable coal reserves
of approximately 77 million tons and additional estimated reserves
of 40 million tons.
Xinergy Ltd. and 25 subsidiaries commenced Chapter 11 bankruptcy
cases (Bankr. W.D. Va. Lead Case No. 15-70444) on April 6, 2015.
The cases have been assigned to Judge Paul M. Black. The cases are
being jointly administered for procedural purposes.
Xinergy Ltd. disclosed $36,968,445 in assets and $215,000,000 in
liabilities as of the Chapter 11 filing.
The Debtors tapped Hunton & Williams LLP as attorneys; Global
Hunter Securities, as financial advisor, and American Legal Claims
Services, LLC as claims, noticing and balloting agent.
The U.S. Trustee appointed a two member official committee of
unsecured creditors. The Committee tapped to retain McGuireWoods
LLP as lead counsel, and Whiteford, Taylor & Preston, LLP as its
local counsel.
The Informal Prepetition Noteholder Committee and DIP Lenders are
represented by Paul, Weiss, Rifkind, Wharton & Garrison.
[*] Feds Say SEC Suit Should Wait for Shkreli's Criminal Case
-------------------------------------------------------------
Carmen Germaine at Bankruptcy Law360 reported that federal
prosecutors asked a New York judge on Jan. 25, 2016, to pause a
securities fraud suit brought by the U.S. Securities and Exchange
Commission against ex-CEO Martin Shkreli, saying the litigation
should be put on the back burner while the criminal case against
him proceeds.
The government filed a motion to intervene in the SEC's civil suit
against Shkreli, Kaye Scholer LLP partner Evan Greebel and
Shkreli's two hedge funds. Prosecutors urged U.S. District Judge
Kiyo A. Matsumoto to stay the case.
[*] JPMorgan to Pay Ambac $995M to Settle RMBS-Related Claims
-------------------------------------------------------------
Sudarshan Varadhan at Reuters reported that bond insurer Ambac
Financial Group Inc. said JPMorgan Chase & Co. will pay $995
million to settle disputes related to residential mortgage-backed
securities.
The settlement will have a positive impact on Ambac's
fourth-quarter operating results and its claims paying resources,
Chief Executive Nader Tavakoli said in a statement.
The settlement comes two weeks after Reuters reported that three of
Ambac's top 10 shareholders were calling on Tavakoli to step down,
claiming that he was slow to settle $4 billion in insurance claims
and lawsuits against JPMorgan, Countrywide Home Loans Inc and Bank
of America Corp.
Ambac has publicly resisted calls to speed up its payment of
insurance claims, citing concerns that it wouldn't be able to meet
its liabilities that extend out to 2054.
The company has said that any change in the payouts schedule is
solely at the discretion of its regulator, the commissioner of
insurance of State of Wisconsin.
Ambac said the settlement also provides for the withdrawal of its
objection to JPMorgan's $4.5 billion RMBS settlement with RMBS
trustees.
JPMorgan said the agreement would not have a material effect on its
first-quarter earnings.
The settlement underscores how Wall Street is still shaking off the
legacy of the U.S. subprime crisis, during which mortgages were
sold to people who could not afford them and then repackaged for
investors without an adequate explanation of how risky they were.
Ambac sued Bank of America in 2014 to recoup hundreds of millions
of dollars of losses from insuring securities backed at least in
part by risky mortgages from the bank's Countrywide Home Loans
unit.
Goldman Sachs Group Inc said earlier this month that it would pay
regulators over $5 billion to settle claims that it misled mortgage
bond investors during the financial crisis.
Ambac shares were up 16 percent at $13.87, while those of JPMorgan
were up 2.4 percent at $56.99 in afternoon trading.
[*] Proskauer Named Among Blaw360's Bankruptcy Group of the Year
----------------------------------------------------------------
Cara Salvatore at Bankruptcy Law360 reported that Proskauer Rose
LLP earned a spot among Law360's 2015 Bankruptcy Groups of the
Year.
Last year, drugmaker PharmAthene Inc. won a nearly $200 million
judgment against rival SIGA Technologies Inc. and was dragged along
as SIGA scrambled into bankruptcy. When PharmAthene brought in
Proskauer, the firm crafted an unusual deal that pushed SIGA
towards a bankruptcy exit.
SIGA's defensive bankruptcy began with the $195 million judgment
when a Delaware judge found that SIGA owed PharmAthene profits.
[*] Skadden Arps Among Blaw360's Bankruptcy Group of the Year
-------------------------------------------------------------
Caroline Simson at Bankruptcy Law360 reported that Skadden Arps
Slate Meagher & Flom LLP landed among Law360's Bankruptcy Groups of
the Year.
Over the last year, Skadden Arps' corporate restructuring team
pioneered the use of English law schemes of arrangement for
European companies and helped Exide Technologies Inc. restructure
more than $1 billion in debt.
Skadden Arps has more than 60 attorneys in the firm's corporate
restructuring practice, well as a number of other attorneys in the
tax, banking, corporate, litigation, real estate, securities and
M&A practices who regularly work on restructuring and bankruptcy
matters.
[*] Suspended Fla. Atty Charged With Stealing as Chapter 7 Trustee
------------------------------------------------------------------
Shayna Posses at Bankruptcy Law360 reported that a suspended
Florida attorney has been indicted for embezzling funds from
Premier Bank Holding Co.'s estate while serving as the Debtor's
Chapter 7 trustee, the government said on Jan. 26, 2016, just over
a month after a state Supreme Court referee recommended his
disbarment.
Lawyer William Reid Penuel, 37, allegedly pocketed money held in a
Branch Banking & Trust Co. account then lied to an FBI agent about
it, according to a recently unsealed Dec. 4 indictment. The
attorney is charged with one count of embezzlement.
Premier Bank Holding Company filed for bankruptcy protection, or
had an involuntary bankruptcy petition filed against it, on August
14, 2012 (Bankr. N.D. Fla. Case No. 12-40550). The bankruptcy case
was assigned to Judge Karen Specie. The law firm of GrayRobinson,
P.A., acted as lead bankruptcy counsel to Premier Bank Holding
Company in the bankruptcy case.
[*] U.S. Suspects Wyoming Officials Lax on Cleanup Insurance
------------------------------------------------------------
Patrick Rucker at Reuters.com reported that the leading U.S.
regulator for the coal industry on Jan. 22, 2016, said it suspects
Wyoming officials have wrongly allowed mining companies to forego
cleanup insurance.
The notice begins a formal federal review by the Interior
Department's Office of Surface Mining and Reclamation Enforcement.
If federal officials find wrongdoing or an abuse under the law,
they could assume oversight of the industry in Wyoming.
Specifically, federal regulators want to know whether two
now-bankrupt mining companies, Arch Coal and Alpha Natural
Resources, have the wherewithal to cover several hundred million of
dollars in future cleanup costs.
At issue is a practice known as self-bonding, allowed under a
decades-old mining program, in which some of the country's biggest
coal companies forego insurance on a portion of future mine cleanup
costs.
Officials estimate that roughly $3.6 billion in self-bond
liabilities could fall to taxpayers and "it is a big issue,"
Secretary of the Interior Sally Jewell told Congress in December.
Taken together, Arch and Alpha have left roughly $900 million in
future cleanup costs through self-bonding in Wyoming.
A spokesman said the Wyoming Department of Environmental Quality
said the agency had received the letter and would respond within 10
business days as required.
[*] Weil Gotshal Bags Law360 Bankr. Group for the 6th Straight Year
-------------------------------------------------------------------
Carmen Germaine at Bankruptcy Law360 reported that Weil Gotshal &
Manges LLP in 2015 showcased the international and
interdisciplinary depth that has made the firm a restructuring
powerhouse, pulling off a major auction for A&P and landing the
firm among Law360's Bankruptcy Groups of the Year for the sixth
year in a row.
Weil Gotshal guided The Great Atlantic & Pacific Tea Co. through a
massive auction process that saved tens of thousands of jobs or
advising creditors in the debt restructuring of an entire country
in Ukraine.
[] US Corporate Defaults to Hit Six-Year High in 2016, Moody's Say
------------------------------------------------------------------
The US speculative-grade default rate rose to 3.2% from 2.7% in the
fourth quarter of 2015 and will likely climb to a six-year high of
4.4% this year, as the drop in prices continues to pressure cash
flows in commodity sectors, says Moody's Investors Service.
"On the back of the oil price slump, defaults were the most
concentrated in the oil and gas industry in 2015 due to weakening
cash flows," said Moody's Senior Vice President John Puchalla. "We
expect oil and gas, along with other commodity sectors, to continue
to push the default rate higher in 2016."
According to the report, "US Corporate Default Monitor -- Fourth
Quarter 2015: Default Rate to Reach Six-Year High in 2016," oil and
gas companies contributed 25 defaults in 2015, pushing the total US
non-financial corporate default count to 56, the highest level
since the 2009 recession.
In the fourth quarter specifically, nine of the 15 US non-financial
corporate defaults were oil and gas companies. Metals and mining
had the second highest sector default count at seven in 2015,
further demonstrating that falling prices are straining the cash
flow and liquidity of commodity-based companies.
Defaults in non-commodity sectors were up only slightly to 24 in
2015 from 21 in 2014. Positive economic growth, modest 2016
maturities, and a lack of widespread covenant issues continue to
support liquidity and contain the number of defaults.
"Liquidity pressures and negative rating trends are modest but
edging up outside of commodity sectors, which raises the
possibility of a sharper rise in the default rate if economic
growth slows or credit losses in energy and tighter monetary policy
further increase investor risk aversion and speculative-grade
borrowing costs," added Puchalla. "This would hurt corporate cash
flow and make it more difficult for low-rated borrowers to resolve
liquidity issues."
*********
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
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Copyright 2016. All rights reserved. ISSN: 1520-9474.
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