/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/160530.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, May 30, 2016, Vol. 20, No. 151 Headlines A.L. EASTMOND: Court OKs FIFC Insurance Financing Agreement ABC DISPOSAL: Seeks to Hire Argus as Financial Advisor ABC DISPOSAL: Seeks to Hire Murphy & King as Counsel ADELPHIA COMMUNICATIONS: Accepts Claims Tendered Under Offers ALLIANCE ONE: Amends 2015 Annual Report ALLIANCE ONE: Amends June 30 2015 Quarterly Report ALLIANCE ONE: Incurs $21.7 Million Net Loss in Q2 2015 ALLIANCE ONE: Posts $11.5 Million Net Income in Q3 2015 ALPHA NATURAL: Court Approves Sale of PLR Assets to Vantage Unit AMERICAN EAGLE: Power Energy Partners Support Conversion to Ch. 7 APOLLO PRESS: Case Summary & 20 Largest Unsecured Creditors ARCADE PROPERTIES: Seeks to Hire Ehrhard as Legal Counsel ARMADA WATER: Seeks to Hire McKool Smith as Legal Counsel ASPEN GROUP: Grants Non-Employee Directors 5-Year Stock Options ATLANTIC CITY, NJ: Governor Signs Financial Rescue Package AVAYA INC: Files Conflicts Minerals Report with SEC BEAR CREEK: Seeks to Hire Jaffe Raitt as Legal Counsel BEN MOSS: Can Restructure Under CCAA, A&M Named as Monitor BREITBURN ENERGY: DIP Facility Approved on Interim BREITBURN ENERGY: U.S. Trustee Forms 3-Member Committee BRUNSWICK CORP: Moody's Puts Ba1 Ratings on Review for Upgrade BUILDERS FIRSTSOURCE: WP IX Sells Entire Stake to Credit Suisse CADILLAC NURSING: Trustee Amends Notice of Committee Appointment CALATLANTIC GROUP: Moody's Rates Proposed $300M Notes 'Ba2' CAPITAL L. CORP: Seeks to Hire Brouse McDowell as Legal Counsel CARL EQUIPMENT: Voluntary Chapter 11 Case Summary CELTIC CONCEPTS: Seeks to Hire Wauson & Probus as Legal Counsel CENGAGE LEARNING: Moody's Cuts Sr. Unsecured Term Loan Rating to B1 CHAMPION INDUSTRIES: Files Amendment #3 to Schedule 13E-3 CHRIST FELLOWSHIP: U.S. Trustee Unable to Appoint Committee CLAIRE'S STORES: Reports Fiscal 2016 First Quarter Results COMPACT UNLIMITED: Seeks to Hire Durand as Legal Counsel COMPUTER SCIENCES: Moody's Affirms Ba1 Stock Shelf Rating CYTORI THERAPEUTICS: Subscription Rights to Expire June 9 D&E GENERAL: Seeks to Hire Hodges Doughty as Legal Counsel DELPHI AUTOMOTIVE: Court Denies Summary Judgment Bids in Solus Suit DEX MEDIA: Alvarez & Marsal's Andrew Hede to Serve as CRO DEX MEDIA: Hires Ernst & Young as Auditor & Tax Advisor DEX MEDIA: Hires Kirkland & Ellis as Chapter 11 Counsel DEX MEDIA: Hires Moelis & Co. as Investment Banker, Fin'l Advisor DEX MEDIA: Hires Young Conaway as Bankruptcy Co-Counsel DEX MEDIA: Taps Epiq Bankruptcy as Administrative Advisor DEX MEDIA: Taps KPMG LLP as Tax Advisors DIFFERENTIAL BRANDS: Joins B. Riley & Co.'s Conference DRAFTDAY FANTASY: Fails to Regain Compliance of NASDAQ Rule DYCOM INDUSTRIES: S&P Affirms 'BB-' Rating on $485MM Sr. Notes EMERALD OIL: Snags $73-Mil. Bid Before July Auction ENERGY TRANSFER: S&P Puts 'BB' CCR on CreditWatch Negative FANNIE MAE: William Forrester Resigns as Director FLOUR CITY BAGELS: Wants 90-Day Extension of Plan Filing Period FRED FULLER: Committee Seeks to Sue Owner, Executives FRESH & EASY: Wants Exclusive Plan Filing Extended to June 28 GERMAN PELLETS: Seeks to Obtain $3.4MM DIP Financing from UMB GIYANI GOLD: Files Financial Statements & MD&A to Remedy Default GOGO INC: S&P Withdraws 'B-' Rating on Proposed Sr. Sec. Notes GREENBRIER COS: S&P Revises Outlook to Pos. & Affirms 'BB-' CCR GREENHUNTER RESOURCES: Crady Jewett Represents Multiple Creditors GRIZZLY CATTLE: Judge Grants Bid to Appoint Chapter 11 Trustee HANOVER PARMENTER: Seeks to Hire Cruickshank as Legal Counsel HCSB FINANCIAL: Amends 23.4 Million Prospectus with SEC HERC RENTALS: Moody's Assigns B1 CFR, Outlook Stable HERC RENTALS: S&P Affirms 'B+' Rating on Proposed Sr. Sec. Notes HERCULES OFFSHORE: To File for Ch. 11 Again and Liquidate HI-CRUSH PARTNERS: S&P Lowers Corp. Credit Rating to B- HONEY BEE: State of Hawaii Opposes Financing Motion HONEY BEE: State of Hawaii Opposes Financing Motion HORSEHEAD HOLDING: Committee Seeks Standing to Sue US Bank IAC/INTERACTIVECORP: Moody's Assigns Ba3 Rating on $400MM Notes IMMC CORPORATION: Liquidating Trustee's Appeals Case Reopened INTELLINETICS INC: GBQ Partners Raises Going Concern Doubt IRON MOUNTAIN: Moody's Affirms Ba3 CFR & Rates New $500MM Notes Ba3 JACK COOPER: Moody's Cuts Corporate Family Rating to Caa2 JD POWER: Moody's Assigns B2 CFR & Rates 1st Lien Debt B1 JOHN PAUL SMITH: Court Reverses Dismissal of Foreclosure Suit K.M. VILLAS: Hires Songer as Forensic Expert KEMET CORP: Incurs $53.6 Million Net Loss in 2015 KOBE RESTAURANT: U.S. Trustee Unable to Appoint Committee KRONOS WORLDWIDE: Moody's Lowers CFR to B1, Outlook Negative LA CASA DEL MAESTRO: Hires Juan C. Vazquez Hernandez as Accountant LA ESTRELLA: Wants Time to Confirm Plan Extended by 90 Days LEGACY BENEFITS: Moody's Lowers Rating on Cl. B Notes to B1 LEUCADIA NATIONAL: Moody's Affirms Ba1 CFR, Outlook Stable LIFE PARTNERS: Schnitman Seeks Dismissal of Trustee's Claims LIME ENERGY: Gets Noncompliance Notice from NASDAQ LUCKY SOIL: Ch.11 Trustee to Hire Nathan Sommers as Counsel M SPACE HOLDINGS: Hires Gordon Brothers as Liquidator MAGNA CLEANERS: Hires John Solt as Chapter 11 Counsel MAHI LLC: Seeks to Hire Stewart Robbins as Legal Counsel MCK MILLENNIUM: Exclusive Plan Filing Period Extended to June 27 MIDSTATES PETROLEUM: Seeks to Hire Evercore as Investment Banker MIDSTATES PETROLEUM: Seeks to Hire Jackson as Conflicts Counsel MIDSTATES PETROLEUM: Seeks to Hire Kirkland as Lead Counsel MOBILESMITH INC: Comerica Loan Agreement Maturity Moved to 2018 MOBILESMITH INC: Stockholders Elect 3 Directors MODERN OFFICE SYSTEMS: Seeks to Hire Michael Marcus as Accountant MOSS FAMILY: BW Allowed $125K Administrative Expense Claim MOSS FAMILY: U.S. Bank Wants Automatic Stay Relief MOTORS LIQUIDATION: Has $612M Assets in Liquidation at March 31 MSC SOFTWARE: Moody's Lowers Corporate Family Rating to B3 MUSCLEPHARM CORP: Settles with ETW Corp. for $2.5 Million NATIONAL BANK OF ANGUILLA: Chapter 15 Case Summary NAVISTAR INTERNATIONAL: Files 2015 Conflicts Minerals Report NEW PHOENIX: Voluntary Chapter 11 Case Summary NEWLEAD HOLDINGS: Incurs $97.1 Million Net Loss in 2015 NORANDA ALUMINUM: Bonuses Approved While Ch. 11 Battle Brews NORFE GROUP: Hires Totti & Rodriguez as Special Counsel NORTEL NETWORKS: Appeals and Cross-Appeals Certified to 3rd Cir. NORTEL NETWORKS: Appeals Certified to Third Circuit NORTEL NETWORKS: Canadian Units, et al., Oppose Distribution to LSI OCI BEAUMONT: S&P Affirms 'B' CCR, Off CreditWatch Positive OLD TAMPA BAY: Case Summary & 3 Unsecured Creditors OPEN TEXT: Moody's Rates Proposed Sr. Unsecured Notes Ba2 PACIFIC SUNWEAR: April 7, 2017 Fixed as New Maturity Date PACIFIC SUNWEAR: Assumption/Rejection Period Extended to Nov. 3 PACIFIC SUNWEAR: Court Authorizes KEIP and KERP Implementation PALISADES PARK: Seeks to Hire Dean Smith as Appraiser PALMAZ SCIENTIFIC: Hires Kingman as Counsel PARADIGM ACQUISITION: Moody's Cuts Corporate Family Rating to B3 PARSLEY ENERGY: Moody's Assigns B3 Rating on $200MM Sr. Notes PENN VIRGINIA: Asks to Assume Restructuring Support Agreement PENN VIRGINIA: Targeting Aug. 4 Confirmation of Plan PERPETUAL ENERGY: Moody's Cuts Corporate Family Rating to Caa2 PIONEER HEALTH: Committee Hires GlassRatner as Financial Advisor PMT INVESTMENTS: U.S. Trustee Unable to Appoint Committee PORTER BANCORP: Shareholders Elect Eight Directors PREFERRED CONCRETE: Hires O. Allan Fridman as Bankruptcy Counsel PREMIER TRANSFER: Seeks to Hire Magee Goldstein as Legal Counsel PRODUCTION RESOURCE: S&P Reinstates CCC+ Rating on $250MM Revolver QRS RECYCLING: Hires Bingham Greenebaum as Counsel QRS RECYCLING: Hires UpShot as Claims Agent QUANTUM MATERIALS: Enters Next Phase of Quantum Dot Development QUINN'S JUNCTION: Seeks to Hire RMA as Accountant RBK TRUCKING: Hires Burgess as Counsel REALOGY GROUP: Moody's Rates New Sr. Unsecured Notes 'B2' REALOGY GROUP: S&P Assigns 'B' Rating on Proposed $500MM Notes REALOGY HOLDINGS: Prices $500 Million Offering of Senior Notes REGAL ENTERTAINMENT: Moody's Assigns Ba1 Rating on Proposed Loan REGATTA CONSTRUCTION: Hires Riley & Dever as Chapter 11 Counsel RELATIVITY MEDIA: Netflix Loses Bid for Advance Release of Films ROCKIES EXPRESS: S&P Affirms 'BB+' CCR & Revises Outlook to Neg. ROCKIES REGION: PwC Expresses Concern Doubt ROLLING LANDS: Seeks to Hire Wyatt as Legal Counsel ROLLING LANDS: U.S. Trustee Unable to Appoint Committee ROMA'S STEAK: Hires Long as Chapter 11 Counsel S-METALS FL: Hires Aresty as Bankruptcy Counsel SAEED COHEN: Farida Cohen's Suit Dismissed Without Leave SCHUPBACH INVESTMENTS: Taps Kuckelman & Stockemer as Accountant SCORPION PERFORMANCE: Exclusive Plan Filing Extended to Aug. 27 SCOTTS MIRACLE-GRO: Moody's Affirms Ba2 CFR, Outlook Stable SEARS HOLDINGS: Incurs $471 Million Net Loss in First Quarter SFX ENTERTAINMENT: Auction of Flavorus Assets Pushed Back to June 2 SFX ENTERTAINMENT: Founder Steps Down as CEO, Inks Transition Deal SFX ENTERTAINMENT: TriNet Objects to Assignment of Contracts SHEEHAN PIPE LINE: Surety Objects to Proposed Cash Collateral Use SPEEDWAY MOTORSPORTS: S&P Affirms 'BB+' Rating on Sr. Notes SQUARETWO FINANCIAL: Moody's Hikes Corporate Family Rating to Caa2 STANLEY JOSEPH CATERBONE: Court Orders Show Cause for Appeal STARVING STUDENTS: Seeks to Hire Garman Turner as Legal Counsel STELLAR BIOTECHNOLOGIES: Named a Calif. Small Business of the Year STEREOTAXIS INC: Shareholders Elect 3 Directors SUNGARD AVAILABILITY: Moody's Lowers CFR to B3, Outlook Stable SUTHERLAND HOLDINGS: Case Summary & 3 Unsecured Creditors SWORDS GROUP: Case Summary & 10 Unsecured Creditors TANGO TRANSPORT: Creditors' Panel Hires Heller Draper as Counsel TATOES LLC: Leland, Anderson Farms Want Replacement Liens TIME INC: S&P Lowers CCR to 'BB-', Outlook Stable TOPS HOLDING: Moody's Affirms B3 Corporate Family Rating TOWN SPORTS: Robert Giardina Resigns as Director TRANSDIGM INC: Fitch Assigns B- Rating on $950MM Sr. Sub. Notes TRIBUNE MEDIA: Court Sustains Objection to Claim No. 3697 TRILOGY INTERNATIONAL: Moody's Assigns Caa1 Rating on $450MM Notes TRINITY RIVER: Hires Bracewell as Counsel TRINITY TOWN: Chapter 11 Plan Provides for Sale by Aug. 30 TX FOUR HOLDINGS: Seeks to Hire Brouse McDowell as Legal Counsel ULTRA PETROLEUM: Taps Rothschild and Petrie as Investment Bankers UNIVERSAL SOFTWARE: Hires Riley & Dever as Chapter 11 Counsel US ENERGY MANAGEMENT: Seeks to Hire Spigner as Legal Counsel VERSO CORPORATION: Wants to Enter into Engagement Letters WARNER MUSIC: Noreena Hertz Quits as Director WASHINGTON FIRST: Case Summary & 7 Unsecured Creditors WEST CORP: Moody's Rates New Term Loans Ba3 WEST CORP: Proposes to Refinance Existing Debt WILLIAMS COS: S&P Puts 'BB' CCR on CreditWatch Negative WINGS OF MEDINA: Wants Plan Filing Deadline Moved to Aug. 12 YUM! BRANDS: Moody's Assigns Ba1 Rating on Proposed Revolver Loan ZOHAR CDO 2003: Fund's Suit Against Patriarch Set for Fast Trial ZYNEX INC: Appoints VP of Finance and VP of Operations [*] Energy & Metals Account 48% of Defaults in 2016, Fitch Says [^] BOND PRICING: For the Week from May 23 to 27, 2016 ********* A.L. EASTMOND: Court OKs FIFC Insurance Financing Agreement ----------------------------------------------------------- A.L. Eastmond & Sons, Inc., and its affiliated debtors sought and obtained from Judge Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York authorization to enter into a postpetition insurance financing agreement with First Insurance Funding Corp. ("FIFC") and any subsequent renewals of the insurance financing agreement. The Debtors had already obtained Court approval for the prepetition Insurance Finance Agreement that it had entered into with FIFC on May 1, 2015. The Debtors related that the prepetition Insurance Finance Agreement expired on May 1, 2016, and that they needed to enter into a new insurance finance agreement with FIFC. "The Debtors are financing premiums for eight Insurance Policies. Pursuant to the Post-petition Insurance Finance Agreement, FIFC will provide financing to the Debtors for the purchase of the Policies which are essential for the operation of the Debtors' business. Under the Post-petition Insurance Finance Agreement, the total premium amount is $1,504,861 and the total amount to be financed is $1,077,099. Under the Post-petition Insurance Finance Agreement, Debtor will become obligated to pay FIFC the sum of $1,108,758 in addition to a down payment that has already been paid in the amount of $427,762 and the balance in nine monthly installments of $123,195 each. The installment payments are due on the first day of each month commencing on June 1, 2016. As collateral to secure the repayment of the total of payments, any late charges, attorney's fees and costs... under the Post-petition Insurance Finance Agreement, the Debtors are granting FIFC a security interest in, among other things, the unearned premiums of the Insurance Policies... Pursuant to the terms of the Post-petition Insurance Finance Agreement, the Debtors are appointing FIFC as its attorney-in-fact with the irrevocable power to cancel the policies and collect the unearned premium in the event the Debtors default on any of their obligations under the Postpetition Insurance Finance Agreement, subject to a ten day notice and cure period," the Debtors aver. The Debtors contended that they have reached an agreement that the adequate protection appropriate for the situation would be as follows: (a) The Debtors are authorized and directed to timely make all payments due under the Postpetition Insurance Finance Agreement and FIFC be authorized to receive and apply such payments to Indebtedness owed by the Debtors to FIFC as provided in the Post-petition Insurance Finance Agreement. (b) If the Debtors do not make any of the payments due under the Postpetition Insurance Finance Agreement as they become due, FIFC will provide the Debtors with notice of the Default. After the Debtors receive Notice, the Debtors will have a Grace Period of 10 days to cure said Default. Once the Grace Period has expired, and if the Default has still not been cured, the automatic stay will automatically lift to enable FIFC and/or insurance companies providing coverage under the Insurance Policies, to take all steps necessary and appropriate to cancel the Insurance Policies, collect the collateral and apply such collateral to the Indebtedness owed to FIFC by the Debtors. Judge Lane held that if additional premiums become due to insurance companies under the policies financed under the Post-petition Insurance Finance Agreement, the Debtors and FIFC are authorized to modify the Post-petition Insurance Finance Agreement as necessary to pay the additional premiums without the necessity of further hearing or order of the Court. A.L. Eastmond & Sons, Inc., and its affiliated debtors are represented by: Tracy L. Klestadt, Esq. Stephanie R. Sweeney, Esq. Maeghan J. McLoughlin KLESTADT WINTERS JURELLER SOUTHARD & STEVENS LLP 200 West 41st St., 17th Floor New York, NY 10018 Telephone: (212)972-3000 Facsimile: (212)972-2245 E-mail: tklestadt@klestadt.com ssweeney@klestadt.com About A.L. Eastmond & Sons A.L. Eastmond & Sons, Inc., Easco Boiler Corp. and Eastmond & Sons Boiler Repair & Welding Service, Inc. filed Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 15-13214) on Dec. 1, 2015. The petitions were signed by Arlington Leon Eastmond, Jr., as president. The Debtors have engaged Klestadt Winters Jureller Southard & Stevens, LLP as counsel. The Debtors listed total assets of $34.6 million and total liabilities of $40.8 million. Judge Sean H. Lane has been assigned the case. The Debtors have provided products and services in over 15,000 locations throughout the tristate area and beyond, including Yankee Stadium, the Trump Towers, Kings County Supreme Court, New York Botanical Garden/Bronx Zoo, Queens County Civil Court, North Shore University, Detroit School District, the Garfield Park Field House in Chicago, Illinois, and the National Geographic Building in Washington, D.C., to name a few. ABC DISPOSAL: Seeks to Hire Argus as Financial Advisor ------------------------------------------------------ ABC Disposal Service, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Argus Management Corp. as their financial advisor. The Debtors propose to hire the firm to provide these legal services: (a) consult the Debtors and their counsel with respect to the development and implementation of a plan to reorganize their business operations; (b) prepare or coordinate the preparation of budgets, analyses and reports; (c) perform or coordinate the performance of an analysis of potential avoidance actions under Chapter 5 of the Bankruptcy Code; (d) prepare or coordinate the preparation of schedules and assets and liabilities of the Debtors; (e) prepare or coordinate the preparation of monthly operating reports; (f) advise the Debtors' senior management about the performance of the business and recommend actions to improve the value of their assets; (g) assist in any negotiations with creditors; and (h) attend court proceedings and testify on behalf of the Debtors. Argus will seek compensation based on its normal and usual hourly billing rates and will seek reimbursement of expenses. Prior to the Debtors' bankruptcy filing, the firm received a retainer of $30,200. Argus is holding the retainer as security for the payment of its fees and expenses, according to court filings. John Haggerty, a principal at Argus, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Argus can be reached through: John G. Haggerty Argus Management Corporation 15 Keith Hill Road Grafton, MA 01519 Tel: (508) 838-1828 About ABC Disposal ABC Disposal Service, Inc., provides full service waste hauling, disposal and recycling services, and sells, rents and services compaction and baling equipment to a variety of industrial, institutional, commercial and construction related customers. New Bedford Waste owns and operates municipal solid waste and construction and demolition debris transfer stations in New Bedford, Sandwich, and Rochester, Massachusetts which transfer and process residential, commercial, industrial, and institutional and construction wastes under approved state and local government permits and licenses. Solid Waste Services, Inc. is a Massachusetts corporation organized in 1999 to hold an ownership interest in New Bedford Waste. Shawmut Associates and A&L Enterprises are Massachusetts limited liability companies which own and lease real estate to ABC and New Bedford Waste in connection with their operations. ZERO Waste Solutions, LLC is a Massachusetts limited liability company formed in 2013 for the purposes of developing and operating an advanced mixed waste recycling facility located on Shawmut Associates' Rochester property to process and market recyclable material and then turn unrecyclable material into compact, clean burning, high yield fuel briquettes which have a variety of industrial uses. The principals of the Debtors are Laurinda F. Camara and her children Susan M. Sebastiao, Kenneth J. Camara, Steven A. Camara, and Michael A. Camara. Each of the Principals owns 20% of the stock in ABC. Each of Susan M. Sebastiao, Kenneth J. Camara, Steven A. Camara and Michael A. Camara own a 12.5% interest in New Bedford Waste and a 25% interest in Shawmut Associates, A&L Enterprises, and Solid Waste Services. Solid Waste Services owns the remaining 50% of the membership interests in New Bedford Waste. New Bedford Waste owns 80% of the membership interests in ZERO Waste. ABC Disposal Service, Inc., New Bedford Waste Services, LLC, Solid Waste Services, Inc., Shawmut Associates, LLC, A&L Enterprises, LLC, and ZERO Waste Solutions, LLC each filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case Nos. 16-11787 to 16-11792, respectively) on May 11, 2016. The petitions were signed by Michael A. Camara as vice president/CEO. Murphy & King Professional Corporation serves as the Debtors' counsel. Argus Management Corp. serves as their financial advisor. The cases are pending joint administration before Judge Joan N. Feeney. ABC DISPOSAL: Seeks to Hire Murphy & King as Counsel ---------------------------------------------------- ABC Disposal Service, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Murphy & King, Professional Corp. as their legal counsel. The Debtors propose to hire the firm to provide these legal services: (a) advise the Debtors about their rights, powers and duties as debtors-in-possession; (b) advise the Debtors about the formulation of a plan of reorganization and assist them in plan negotiations; (c) represent the Debtors at all hearings; (d) prepare legal papers on the Debtors' behalf; (e) advise and assist the Debtors in the negotiation and documentation of financing agreements, debt and cash collateral orders and related transactions; (f) review and analyze the nature and validity of any liens asserted against the Debtors' property; (g) advise the Debtors regarding their ability to initiate actions to collect and recover property; (h) advise and assist the Debtors in connection with the potential sale of their assets; (i) advise the Debtors concerning executory contracts and unexpired leases; (j) review claims of creditors and file objections to those claims; (k) commence litigation necessary to protect assets of the Debtors or further the goal of completing the Debtors' successful reorganization. Murphy & King will seek compensation based on its normal and usual hourly billing rates and will seek reimbursement of expenses. Harold Murphy, a shareholder of Murphy & King, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Harold B. Murphy, Esq. Christopher M. Condon, Esq. Michael K. O'Neil, Esq. Murphy & King, Professional Corp. One Beacon Street, 21st Floor Boston, MA 02108-3107 Tel: (617) 423-0400 Fax: (617) 423-0498 Email: moneil@murphyking.com ccondon@murphyking.com About ABC Disposal ABC Disposal Service, Inc., provides full service waste hauling, disposal and recycling services, and sells, rents and services compaction and baling equipment to a variety of industrial, institutional, commercial and construction related customers. New Bedford Waste owns and operates municipal solid waste and construction and demolition debris transfer stations in New Bedford, Sandwich, and Rochester, Massachusetts which transfer and process residential, commercial, industrial, and institutional and construction wastes under approved state and local government permits and licenses. Solid Waste Services, Inc. is a Massachusetts corporation organized in 1999 to hold an ownership interest in New Bedford Waste. Shawmut Associates and A&L Enterprises are Massachusetts limited liability companies which own and lease real estate to ABC and New Bedford Waste in connection with their operations. ZERO Waste Solutions, LLC is a Massachusetts limited liability company formed in 2013 for the purposes of developing and operating an advanced mixed waste recycling facility located on Shawmut Associates' Rochester property to process and market recyclable material and then turn unrecyclable material into compact, clean burning, high yield fuel briquettes which have a variety of industrial uses. The principals of the Debtors are Laurinda F. Camara and her children Susan M. Sebastiao, Kenneth J. Camara, Steven A. Camara, and Michael A. Camara. Each of the Principals owns 20% of the stock in ABC. Each of Susan M. Sebastiao, Kenneth J. Camara, Steven A. Camara and Michael A. Camara own a 12.5% interest in New Bedford Waste and a 25% interest in Shawmut Associates, A&L Enterprises, and Solid Waste Services. Solid Waste Services owns the remaining 50% of the membership interests in New Bedford Waste. New Bedford Waste owns 80% of the membership interests in ZERO Waste. ABC Disposal Service, Inc., New Bedford Waste Services, LLC, Solid Waste Services, Inc., Shawmut Associates, LLC, A&L Enterprises, LLC, and ZERO Waste Solutions, LLC each filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case Nos. 16-11787 to 16-11792, respectively) on May 11, 2016. The petitions were signed by Michael A. Camara as vice president/CEO. Murphy & King Professional Corporation serves as the Debtors' counsel. Argus Management Corp. serves as their financial advisor. The cases are pending joint administration before Judge Joan N. Feeney. ADELPHIA COMMUNICATIONS: Accepts Claims Tendered Under Offers ------------------------------------------------------------- ACC Claims Holdings, LLC on May 27, 2016, announced the acceptance of Claims validly tendered and not validly withdrawn Claims pursuant to its previously announced offers to certain eligible holders to exchange (i) class A limited liability company interests of ACC Claims Holdings, LLC for up to all of the outstanding ACC Senior Notes Claims (Class ACC 3) allowed under the Plan of Reorganization, including any post-petition pre-effective date interest and post-effective date interest to and including the extended expiration date of the offers (the "Senior Claims"), against Adelphia Communications Corporation, and (ii) class B limited liability company interests of ACC Claims Holdings, LLC for up to all of the outstanding ACC Trade Claims (Class ACC 4) allowed under the Plan of Reorganization, including any post-petition pre-effective date interest and post-effective date interest to and including the extended expiration date of the offers (the "ACC 4 Claims"), and ACC Other Unsecured Claims (Class ACC 5) allowed under the Plan of Reorganization, including any post-petition pre-effective date interest and post-effective date interest to and including the extended expiration date of the offers (the "ACC 5 Claims" and, together with the ACC 4 Claims, the "Other Claims"; the Senior Claims and the Other Claims, together, the "Claims"), against Adelphia Communications Corporation. The exchange offers expired at 5:00 p.m., New York City time, on Thursday, May 26, 2016 (the "Expiration Date"). The payment date for the exchange offers will be promptly following the Expiration Date and is expected to be on or about June 2, 2016. The managing member of ACC Claims Holdings, LLC announces that the holders of approximately 89% of the Senior Claims and the Other Claims have validly tendered their claims pursuant to the exchange offers. The managing member of ACC Claims Holdings, LLC has waived the minimum tender condition of 90% of the Claims held by eligible holders. At the Expiration Date, eligible holders of $4,480,394,458.00 original principal amount of ACC Senior Notes (as defined in the Plan of Reorganization) outstanding, eligible holders of $297,348,619.16 of ACC 4 Claims outstanding and eligible holders of $45,562,809.75 of ACC 5 Claims outstanding had validly tendered their Claims pursuant to the exchange offers, and all such tenders of Claims have been accepted. The exchange offers were made pursuant to (i) the offers to exchange, dated March 3, 2016, and supplemented and amended on March 9, 2016, March 21, 2016, April 1, 2016, April 8, 2016, April 15, 2016, and April 21, 2016, April 29, 2016, May 5, 2016, May 13, 2016 and May 20, 2016, and (ii) the related letter of transmittal, dated as of March 3, 2016 and supplemented and amended on March 21, 2016 and May 20, 2016. ACC Claims Holdings, LLC is a Delaware limited liability company formed on November 18, 2015. ACC Claims Holdings, LLC exists solely for the purpose of liquidating the claims and distributing the proceeds thereof to the holders of its limited liability company interests. ACC Claims Holdings, LLC does not conduct a trade or business or engage in any transactions other than transactions merely incidental to (i) liquidation of claims, whether by sale, transfer or other disposition by ACC Claims Holdings, LLC or the claims held thereby, or be merger, consolidation or other reorganization of ACC Claims Holdings, LLC, or otherwise, and (ii) its dissolution. About Adelphia Communications Based in Coudersport, Pennsylvania, Adelphia Communications Corporation was once the fifth-biggest cable company. Adelphia served customers in 30 states and Puerto Rico, and offered analog and digital video services, Internet access and other advanced services over its broadband networks. Adelphia collapsed in 2002 after disclosing that founder John Rigas and his family owed $2.3 billion in off-balance-sheet debt on bank loans taken jointly with the company. Mr. Rigas was sentenced to 12 years in prison, while son Timothy 15 years. Adelphia Communications and its more than 200 affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 02-41729) on June 25, 2002. Willkie Farr & Gallagher represented the Debtors in their restructuring effort. PricewaterhouseCoopers served as the Debtors' financial advisor. Kasowitz, Benson, Torres & Friedman LLP and Klee, Tuchin, Bogdanoff & Stern LLP represented the Official Committee of Unsecured Creditors. Adelphia Cablevision Associates of Radnor, L.P., and 20 of its affiliates, collectively known as Rigas-Managed Entities, were entities that were previously held or controlled by members of the Rigas family. In March 2006, the rights and titles to these entities were transferred to certain subsidiaries of Adelphia Cablevision LLC. The RME Debtors filed for Chapter 11 protection (Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642) on March 31, 2006. Their cases were jointly administered under Adelphia Communications and its debtor-affiliates' Chapter 11 cases. The Bankruptcy Court confirmed the Debtors' Joint Chapter 11 Plan of Reorganization on Jan. 5, 2007. The Plan became effective on Feb. 13, 2007. The Adelphia Recovery Trust, a Delaware Statutory Trust, was formed pursuant to the Plan. The Trust holds certain litigation claims transferred pursuant to the Plan against various third parties and exists to prosecute the causes of action transferred to it for the benefit of holders of Trust interests. Lawyers at Kasowitz, Benson, Torres & Friedman, LLP (NYC), represent the Adelphia Recovery Trust. ALLIANCE ONE: Amends 2015 Annual Report --------------------------------------- Alliance One International, Inc. filed with the Securities and Exchange Commission an amended annual report on Form 10-K/A for the year ended March 31, 2015, originally filed with the SEC on June 8, 2015, to restate its consolidated financial statements and related footnote disclosures for the years ended March 31, 2015, 2014 and 2013. On Feb. 15, 2016, the Audit Committee of the Company's Board of Directors, after discussion with management, determined that the following financial statements previously filed with the SEC should no longer be relied upon (1) the audited consolidated financial statements included in our Annual Report on Form 10-K for the years ended March 31, 2015, 2014 and 2013; and (2) the unaudited condensed consolidated financial statements included in our Quarterly Reports on Form 10-Q for the quarters ended June 30, 2015, 2014 and 2013, Sept. 30, 2014 and 2013, and Dec. 31, 2014, and 2013. The auditor reports on the consolidated financial statements as of and for the year ended March 31, 2015, 2014 and 2013, and the effectiveness of internal control over financial reporting, management's report on the effectiveness of internal control over financial reporting, and stockholder communications describing the portion of our financial statements for these periods that needed to be restated should no longer be relied upon. In the course of downsizing and terminating certain operations of Alliance One Tobacco (Kenya) Limited, and preparing its financial statements for the quarter ended Sept. 30, 2015, the Company identified errors in accounts receivable, inventory, sales and cost of goods sold in AOTK. Specifically, the value of inventory was overstated due to improper accounting for shrinkage, deferred crop costs, lower of cost or market valuations and inventory counts. Further, sales and other operating revenues, and trade and other receivables, net were incorrectly stated due to improper revenue recognition for external sales. As a result of these errors, the Company has restated its consolidated financial statements for the years ended March 31, 2015, 2014 and 2013 and the selected quarterly financial data (unaudited) on this Form 10-K/A. In addition, the Company has restated selected consolidated statement of operations data for the fiscal year ended March 31, 2012 and selected consolidated balance sheet data at March 31, 2012 and 2011, which restated selected consolidated financial data have not been audited. As of March 31, 2015, the correction of these errors decreased the reported amount of inventory by approximately $32 million, decreased accounts receivable by approximately $7 million, and decreased retained earnings by approximately $39 million. Approximately $26 million of the decrease in retained earnings is related to periods prior to the year ended March 31, 2015, with a portion in each quarter dating back to fiscal 2011 and prior. Further, these corrections decreased operating income for the year ended March 31, 2015, by approximately $13 million. As restated, the Company reported a net loss of $26.30 million on $2.06 billion of sales and other operating revenues for the year ended March 31, 2016, compared to a net loss of $15.59 million on $2.06 billin of sales and other operating revenues for the year ended March 31, 2015. As of March 31, 2015, the Company's restated balance sheet showed $1.62 billion in total assets, $1.42 billion in total liabilities and $197.26 million in total equity. A full-text copy of the Form 10-K/A is available for free at: https://is.gd/r3dEZW About Alliance One Alliance One International is principally engaged in purchasing, processing, storing, and selling leaf tobacco. The Company purchases tobacco primarily in the United States, Africa, Europe, South America and Asia for sale to customers primarily in the United States, Europe and Asia. Alliance One reported a net loss of $15.6 million on $2.10 billion of sales and other operating revenues for the year ended March 31, 2015, compared to a net loss of $87 million on $2.3 billion of sales and other operating revenues for the year ended March 31, 2014. * * * As reported by the TCR on Feb. 12, 2015, Moody's Investor Service downgraded the Corporate Family Rating of Alliance One International, Inc. (AOI) to Caa1 from B3. The downgrade of AOI's CFR to Caa1 reflects Moody's expectation that credit metrics will remain weak over the next 12 - 18 months. The TCR reported on April 13, 2015, that Standard & Poor's Ratings Services lowered its corporate credit rating on Morrisville, N.C.-based Alliance One International Inc. to 'CCC+' from 'B-'. ALLIANCE ONE: Amends June 30 2015 Quarterly Report -------------------------------------------------- Alliance One International, Inc., filed an amended quarterly report on Form 10-Q/A for the quarter ended June 30, 2015, originally filed with the Securities and Exchange Commission on Aug. 5, 2015, to restate the Company's unaudited condensed consolidated financial statements and related footnote disclosures for the three months ended June 30, 2015 and 2014. On Feb. 15, 2016, the Audit Committee of our Board of Directors, after discussion with management, determined that the following financial statements previously filed with the SEC should no longer be relied upon: (1) the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the years ended March 31, 2015, 2014 and 2013; and (2) the unaudited condensed consolidated financial statements included in the Company's Quarterly Reports on Form 10-Q for the quarters ended June 30, 2015, 2014 and 2013, Sept. 30, 2014 and 2013, and December 31, 2014 and 2013. In the course of downsizing and terminating certain operations of Alliance One Tobacco (Kenya) Limited, and preparing the Company's financial statements for the quarter ended Sept. 30, 2015, the Company identified errors in accounts receivable, inventory, sales and cost of goods sold in AOTK. Specifically, the value of inventory was overstated due to improper accounting for shrinkage, deferred crop costs, lower of cost or market valuations and inventory counts. Further, sales and other operating revenues, and trade and other receivables, net were incorrectly stated due to improper revenue recognition for external sales. As a result of these errors, the Company has restated its consolidated financial statements for the years ended March 31, 2015, 2014 and 2013 and its unaudited condensed consolidated financial information for the three months ended June 30, 2015 and 2014 on this Form 10-Q/A. As of June 30, 2015, the correction of these errors decreased the reported amount of inventory by approximately $40 million, decreased accounts receivable by approximately $5 million, and decreased retained earnings by approximately $45 million. Approximately $39 million of the decrease in retained earnings is related to March 31, 2015 and prior periods, with a portion in each quarter dating back to fiscal 2011 and prior. Further, these corrections decreased operating income for the three months ended June 30, 2015 by approximately $6 million. As restated, the Company reported a net loss of $25.95 million on $266.28 million of sales and other operating revenue for the three months ended June 30, 2015, compared to a net loss of $22.91 million on $263.81 million of sales and other operating revenues as originally reported. The Company's restated balance sheet at June 30, 2015, showed $1.83 billion in total assets, $1.65 billion in total liabilities and $175.83 million in total equity. A full-text copy of the Form 10-Q/A is available for free at: https://is.gd/sWSIGz About Alliance One Alliance One International is principally engaged in purchasing, processing, storing, and selling leaf tobacco. The Company purchases tobacco primarily in the United States, Africa, Europe, South America and Asia for sale to customers primarily in the United States, Europe and Asia. Alliance One reported a net loss of $15.6 million on $2.10 billion of sales and other operating revenues for the year ended March 31, 2015, compared to a net loss of $87 million on $2.3 billion of sales and other operating revenues for the year ended March 31, 2014. * * * As reported by the TCR on Feb. 12, 2015, Moody's Investor Service downgraded the Corporate Family Rating of Alliance One International, Inc. (AOI) to Caa1 from B3. The downgrade of AOI's CFR to Caa1 reflects Moody's expectation that credit metrics will remain weak over the next 12 - 18 months. The TCR reported on April 13, 2015, that Standard & Poor's Ratings Services lowered its corporate credit rating on Morrisville, N.C.-based Alliance One International Inc. to 'CCC+' from 'B-'. ALLIANCE ONE: Incurs $21.7 Million Net Loss in Q2 2015 ------------------------------------------------------ Alliance One International, Inc., filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $21.75 million on $415 million of sales and other operating revenues for the three months ended Sept. 30, 2015, compared to a net loss of $8.15 million on $596.97 million of sales and other operating revenues for the same period in 2014. For the six months ended Sept. 30, 2015, the Company reported a net loss of $47.7 million on $681 million of sales and other operating revenues compared to a net loss of $31.78 million on $846 million of sales and other operating revenues for the six months ended Sept. 30, 2014. As of Sept. 30, 2015, the Company had $1.94 billion in total assets, $1.78 billion in total liabilities and $158 million in total equity. A full-text copy of the Form 10-Q is available for free at: https://is.gd/97az59 About Alliance One Alliance One International is principally engaged in purchasing, processing, storing, and selling leaf tobacco. The Company purchases tobacco primarily in the United States, Africa, Europe, South America and Asia for sale to customers primarily in the United States, Europe and Asia. Alliance One reported a net loss of $15.6 million on $2.10 billion of sales and other operating revenues for the year ended March 31, 2015, compared to a net loss of $87 million on $2.3 billion of sales and other operating revenues for the year ended March 31, 2014. * * * As reported by the TCR on Feb. 12, 2015, Moody's Investor Service downgraded the Corporate Family Rating of Alliance One International, Inc. (AOI) to Caa1 from B3. The downgrade of AOI's CFR to Caa1 reflects Moody's expectation that credit metrics will remain weak over the next 12 - 18 months. The TCR reported on April 13, 2015, that Standard & Poor's Ratings Services lowered its corporate credit rating on Morrisville, N.C.-based Alliance One International Inc. to 'CCC+' from 'B-'. ALLIANCE ONE: Posts $11.5 Million Net Income in Q3 2015 ------------------------------------------------------- Alliance One International, Inc., filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $11.5 million on $491 million of sales and other operating revenues for the three months ended Dec. 31, 2015, compared to net income of $3.06 million on $489 million of sales and other operating revenues for the same period in 2014. For the nine months ended Dec. 31, 2015, the Company reported a net loss of $36.2 million on $1.17 billion of sales and other operating revenues compared to a net loss of $28.7 million on $1.33 billion of sales and other operating revenues for the nine months ended Dec. 31, 2014. As of Dec. 31, 2015, Alliance One had $1.96 billion in total assets, $1.78 billion in total liabilities and $174 million in total equity. Pieter Sikkel, chief executive officer and president, said, "While the slow start to purchasing this year has continued to affect shipment and sales volumes through the first three quarters, we are pleased to see steadily improving operating income in our Other Regions segment as the impact of our global footprint rationalization, cost reduction initiatives and some reversal of partial vertical integration strategies by certain customers are starting to show results. Despite the continued expectation of full service sales volume increases this year, there are several significant key offsetting factors that impacted consolidated sales and profitability. These include the strong U.S. dollar and weather related reduced crop sizes in the United States. Smaller U.S. crops resulted in decreased processing volumes and sales, as well as increased costs per unit. "We believe that global oversupply is continuing to correct and that the fourth quarter, as anticipated, will be the largest sales and profit quarter this fiscal year based on later crop timing and associated sales versus last year. We are currently closing our fiscal year 2016 books and expect sales of approximately $1.9 billion and adjusted EBITDA similar to the prior year. "Our comprehensive global restructuring program that began in the fourth quarter last year is continuing to reduce our cost structure and further optimize our global footprint. Improvements to our global footprint include rationalizing underperforming markets and maximizing core markets where we have made investments. Our results are beginning to show the impact of these initiatives with approximately 95.0% of targeted actions taken and over $35.0 million of anticipated end-state recurring annualized savings on track. "As previously reported in connection with the restructuring program we decided to exit green leaf sourcing in the Kenyan market and in implementing such initiative discovered improper accounting issues at our Kenyan operation. As a result, we promptly engaged a third party investigator who determined that improper accounting occurred at our Kenyan entity resulting in approximately $50.8 million of discrepancies, mainly in inventory and accounts receivable that stretches back to at least 2008. We have now restated our financial results for fiscal years 2012 through 2015 and for the first quarter of fiscal year 2016. Those we believe are responsible no longer work for the company and we are working with investigators to hold such individuals accountable, while working with our global insurers to seek remedies where available. Additionally, the investigation assessed other country operations and concluded that no similar issues to those discovered in Kenya exist elsewhere within the Company’s global footprint. As a result of these findings, we have enhanced our global control environment to best position our operations to prevent this type of problem in the future. Mr. Sikkel, concluded, "Global crop production volumes are decreasing as a result of El Nino and lower prices paid to our suppliers in many markets over the last two crops. Supply is moving towards manufacturers' requirements and we anticipate this next year may result in improved supply and demand balance with further opportunities to reduce uncommitted inventory levels. Our commitment to sustainability, good agricultural practices and improvement in family farm income are central to both our short-term and long-term planning. Our customers' focus on sustainable, efficient supply chain management provides opportunity to grow and enhance our results that should improve shareholder value." As of Dec. 31, 2015, available credit lines and cash were $608.3 million, comprised of $195.2 million in cash and $413.1 million of credit lines, of which $10.3 million was available under the U.S. revolving credit facility for general corporate purposes, $394.0 million of foreign seasonal credit lines and $8.8 million exclusively for letters of credit. Additionally, in the future, the Company said it may elect to redeem, repay, make open market purchases, retire or cancel indebtedness prior to stated maturity under its various global bank facilities and outstanding public notes, as they may permit. A full-text copy of the Form 10-Q is available for free at: https://is.gd/IU5tp6 About Alliance One Alliance One International is principally engaged in purchasing, processing, storing, and selling leaf tobacco. The Company purchases tobacco primarily in the United States, Africa, Europe, South America and Asia for sale to customers primarily in the United States, Europe and Asia. Alliance One reported a net loss of $15.6 million on $2.10 billion of sales and other operating revenues for the year ended March 31, 2015, compared to a net loss of $87 million on $2.3 billion of sales and other operating revenues for the year ended March 31, 2014. * * * As reported by the TCR on Feb. 12, 2015, Moody's Investor Service downgraded the Corporate Family Rating of Alliance One International, Inc. (AOI) to Caa1 from B3. The downgrade of AOI's CFR to Caa1 reflects Moody's expectation that credit metrics will remain weak over the next 12 - 18 months. The TCR reported on April 13, 2015, that Standard & Poor's Ratings Services lowered its corporate credit rating on Morrisville, N.C.-based Alliance One International Inc. to 'CCC+' from 'B-'. ALPHA NATURAL: Court Approves Sale of PLR Assets to Vantage Unit ---------------------------------------------------------------- Judge Kevin R. Heunnekens of the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, authorized Alpha Natural Resources, Inc., et al., for Debtor Pennsylvania Land Resources, LLC, to sell certain oil and gas properties and related assets to Vantage Energy Appalachia II LLC. As previously reported by The Troubled Company Reporter, a subsidiary of Vantage Energy Inc. has been designated as successful bidder following an auction on May 16. Vantage beat out Rice Energy Drilling B, LLC, which acted as lead bidder. Jamison Cocklin, writing for Natural Gas Intelligence's naturalgasintel.com, reported that Vantage Energy Appalachia II LLC has offered $339.5 million for the assets. PRL, one of the Debtors, in April entered into an amended and restated asset purchase agreement with Rice Drilling B LLC, an affiliate of Rice Energy, whereby Rice would purchase substantially all of the assets of PLR for $200 million in cash, subject to limited purchase price adjustments, and the assumption of certain liabilities. Pursuant to the terms of the Purchase Agreement, PLR and certain affiliated entities will sell leasehold interests in approximately 27,400 net undeveloped Marcellus acres, as well as fee interests in the oil and gas underlying an additional 3,200 gross acres. Included within the acreage to be acquired by Rice are the rights to the Utica on approximately 23,500 net acres. The Purchase Agreement provides that at closing, Rice and certain Alpha affiliates will enter into agreements providing for the rights of the parties with respect to the development of (a) the coal, by the Alpha affiliates or their successors in interest, and (b) the oil and gas, by Rice. Rice is being represented in Alpha's case by: Vinson & Elkins LLP 1001 Fannin Street, Suite 2500 Attention: David Meyer, Esq. Bryan Loocke, Esq. Facsimile: 713-615-5031 E-mail: dmeyer@velaw.com bloocke@velaw.com About Alpha Natural Resources Headquartered in Bristol, Virginia, Alpha Natural -- http://www.alphanr.com-- is a coal supplier, ranked second largest among publicly traded U.S. coal producers as measured by 2014 consolidated revenues of $4.3 billion. As of August 2015, Alpha had 8,000 full time employees across many different states, with UMWA representing 1,000 of the employees. Alpha Natural Resources, Inc. (Bankr. E.D. Va. Case No. 15-33896) and its affiliates filed separate Chapter 11 bankruptcy petitions on Aug. 3, 2015, listing $9.9 billion in total assets as of June 30, 2015, and $7.3 billion in total liabilities as of June 30, 2015. The petitions were signed by Richard H. Verheij, executive vice president, general counsel and corporate secretary. Judge Kevin R. Huennekens presides over the cases. David G. Heiman, Esq., Carl E. Black, Esq., and Thomas A. Wilson, Esq., at Jones Day serve as the Debtors' general counsel. Tyler P. Brown, Esq., J.R. Smith, Esq., Henry P. (Toby) Long, III, Esq., and Justin F. Paget, Esq., serve as the Debtors' local counsel. Rothschild Group is the Debtors' financial advisor. Alvarez & Marshal Holdings, LLC, is the Debtors' investment banker. Kurtzman Carson Consultants, LLC, is the Debtors' claims and noticing agent. The U.S. Trustee for Region 4 appointed seven creditors of Alpha Natural Resources Inc. to serve on the official committee of unsecured creditors. Dennis F. Dunne, Esq., Evan R. Fleck, Esq., and Eric K. Stodola, Esq., at Milbank, Tweed, Hadley & McCloy LLP; and William A. Gray, Esq., W. Ashley Burgess, Esq., and Roy M. Terry, Jr., Esq. at Sands Anderson PC, represent the Committee. * * * Alpha Natural Resources, Inc. on March 8, 2016, disclosed that it has filed a proposed Chapter 11 Plan of Reorganization and a related Disclosure Statement with the United States Bankruptcy Court for the Eastern District of Virginia. Together with the motion seeking approval of a marketing process for Alpha's core operating assets, these filings provide for the sale of Alpha's assets, detail a path toward the resolution of all creditor claims, and anticipate the emergence of a streamlined and sustainable reorganized company able to satisfy its environmental obligations on an ongoing basis. By selling certain assets as a going concern and restructuring the company's remaining assets into a reorganized Alpha, the company is able to provide maximum recovery to its creditors, while preserving jobs and putting itself in the best position to meet its reclamation obligations. This path will allow for a conclusion of Alpha's bankruptcy proceedings by June 30, 2016. AMERICAN EAGLE: Power Energy Partners Support Conversion to Ch. 7 ----------------------------------------------------------------- Power Energy Partners, LP, and Power Crude Transport, Inc., join in the motions of the Official Committee of Unsecured Creditors and the United States Trustee to convert the Chapter 11 cases of American Eagle Energy Corporation, et al., to a Chapter 7 liquidation. Both the Official Committee and the U.S. Trustee contended that cause exists to convert the jointly administered cases to Chapter 7 and that conversion is in the best interest of the estates and creditors. KBC Minerals LLC objected to the conversion. "A lack of good faith is, in and of itself, cause for seeking converting the case to Chapter 7 in filing motions for relief from stay thus create more delay in formulating, filing, and obtaining confirmation of a plan or to request dismissal of the case altogether. Thus we ask the court to deny this conversion at this time and first complete the standing order of the court, which was to make the Royalty Owners whole under chapter 11 and not to create at this time, an avenue for dischargeability of responsibility to Royalty Owners," avers Kent Coplan, CEO and Owner of KBC Minerals LLC. Power Energy Partners, LP, and Power Crude Transport, Inc., are represented by: Theodore J. Hartl, Esq. LINDQUIST & VENNUM LLP 600 17th Street, Suite 1800 South Denver, Colorado 80202 Telephone: (303)573-5900 Facsimile: (303)573-1956 E-mail: thartl@lindquist.com - and - Kevin M. Lippman, Esq. Deborah M. Perry, Esq. MUNSCH HARDT KOPF & HARR, P.C. 500 N. Akard Street, Suite 3800 Dallas, TX 75201-6659 Telephone: (214)855-7500 Facsimile: (214)855-7584 E-mail: klippman@munsch.com dperry@munsch.com About American Eagle Energy 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. APOLLO PRESS: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Apollo Press, Inc. 270 Enterprise Drive Newport News, VA 23603 Case No.: 16-50717 Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Eastern District of Virginia (Newport News) Judge: Hon. Frank J. Santoro Debtor's Counsel: Carolyn L Camardo, Esq. HARRY JERNIGAN CPA ATTORNEY, P.C. 5101 Cleveland Street, Suite 200 Virginia Beach, VA 23462 Tel: 757-490-2200 Fax: 757-490-0280 E-mail: ccamardo@hjlaw.com - and - Harry W. Jernigan, III, Esq. HARRY JERNIGAN CPA ATTORNEY, P.C. 5101 Cleveland Street, Suite 200 Virginia Beach, VA 23462 Tel: 757-490-2200 E-mail: hj@hjlaw.com Debtor's BLACK MARLIN FINANCIAL SERVICES GROUP, PLC Accountants: Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by John Warren Taylor, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/vaeb16-50717.pdf ARCADE PROPERTIES: Seeks to Hire Ehrhard as Legal Counsel --------------------------------------------------------- Arcade Properties, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Ehrhard & Associates, P.C. as its legal counsel. Arcade proposed to hire the firm to provide legal advice with respect to its powers and duties as a debtor; prepare legal papers; and represent the Debtor with respect to the sale, refinance or restructuring of its property. Counsel has received a retainer of $10,000, of which $8,283 is being held in escrow for legal fees while $1,717 was used for the filing fee. Any additional fees incurred over and above the original retainer amount will be billed at the regular billing rates of $300 for senior attorneys; $275 for junior attorneys; $130 for paralegals; and $85 for legal secretaries. James Ehrha disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Ehrhard & Associates can be reached through: James P. Ehrhard, Esq. Ehrhard & Associates, P.C. 250 Commercial Street, Ste 410 Worcester, MA 01608 Tel: (508) 791-8411 E-mail: ehrhard@ehrhardlaw.com About Arcade Properties Arcade Properties, Inc. sought protection under Chapter 11 of the Bankruptcy Code in the District of Massachusetts (Case No. 16-40888) on May 20, 2016. ARMADA WATER: Seeks to Hire McKool Smith as Legal Counsel --------------------------------------------------------- Armada Water Assets, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire McKool Smith, P.C. as its legal counsel. The Debtors propose to hire the firm to provide these legal services: (a) advise the Debtors about their rights, powers and duties as debtors-in-possession; (b) perform all legal services necessary in the administration of the Debtors' Chapter 11 cases and their business; (c) advise the Debtors and assist them in the negotiation and documentation of financing agreements and debt restructurings; (d) review the nature and validity of agreements relating to the Debtors' interests in real and personal property; (e) advise the Debtors concerning preference, avoidance, recovery or other actions that they may take to collect and to recover property; (f) prepare legal papers on behalf of the Debtors; (g) prepare responses to papers that may be filed and served in the Debtors' cases; (h) assist the Debtors in the negotiation, bid process, auction and closing of a sale of all or substantially all of their assets; (i) advise the Debtors about the formulation of a plan of reorganization or liquidation; (j) work with and coordinating efforts among other professionals to attempt to preclude any duplication of effort among those professionals; (k) work with professionals retained by other parties-in- interest to structure a consensual plan of reorganization or other resolution for the Debtors. The primary attorneys who will represent the Debtors and their hourly rates are: Hugh M. Ray, III Principal $750 Benjamin Hugon Associate $575 Veronica Manning Associate $415 Hugh Ray, III, a principal at McKool Smith, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. McKool Smith can be reached through: Hugh M. Ray, III Benjamin W. Hugon Veronica F. Manning McKool Smith P.C. 600 Travis, Suite 7000 Houston, Texas 77002 Tel: 713-485-7300 Fax: 713-485-7344 About Armada Water Assets Armada Water Assets, Inc. and its affiliates sought protection under Chapter 11 of the Bankruptcy Code in the Southern District of Texas (Victoria) (Case Nos. 16-60056 to 16-60063) on May 23, 2016. The petition was signed by Tom Breen, chief restructuring officer. The cases are pending joint administration before Judge David R. Jones under proposed Lead Case No. 16-60056. The Debtors estimated both assets and liabilities in the range of $10 million to $50 million. ASPEN GROUP: Grants Non-Employee Directors 5-Year Stock Options --------------------------------------------------------------- Aspen Group, Inc., granted to each of its non-employee directors 150,000 five-year stock options on May 19, 2016. The Company granted an additional 50,000 five-year stock options to the chairman of the Compensation Committee and to the chairman of the Audit Committee. The options are exercisable at $0.16 and vest in three approximately equal annual increments, with the first vesting date being one year from the grant date, subject to continued service as a director or committee chairman on each applicable vesting date and accelerated vesting under certain conditions. About Aspen Group Denver, Colo.-based Aspen Group, Inc., was founded in Colorado in 1987 as the International School of Information Management. On Sept. 30, 2004, it was acquired by Higher Education Management Group, Inc., and changed its name to Aspen University Inc. On May 13, 2011, the Company formed in Colorado a subsidiary, Aspen University Marketing, LLC, which is currently inactive. On March 13, 2012, the Company was recapitalized in a reverse merger. Aspen's mission is to become an institution of choice for adult learners by offering cost-effective, comprehensive, and relevant online education. Approximately 88 percent of the Company's degree-seeking students (as of June 30, 2012) were enrolled in graduate degree programs (Master or Doctorate degree program). Since 1993, the Company has been nationally accredited by the Distance Education and Training Council, a national accrediting agency recognized by the U.S. Department of Education. Aspen Group reported a net loss of $4.2 million on $5.2 million of revenues for the year ended April 30, 2015, compared to a net loss of $5.3 million on $3.9 million of revenues for the year ended April 30, 2014. As of Jan. 31, 2016, Aspen had $5.12 million in total assets, $4.39 million in total liabilities and $733,628 in total stockholders' equity. ATLANTIC CITY, NJ: Governor Signs Financial Rescue Package ---------------------------------------------------------- Michael Catalini, writing for The Associated Press, reported that Republican Gov. Chris Christie has signed a package of bills to keep financially troubled Atlantic City from running out of cash. According to the report, the Democratic-led Assembly and Senate approved the measures by wide margins on May 26 just as the state's 127 miles of beaches prepared for Memorial Day, the unofficial start of summer. Gov. Christie said the bills give him the authority he needs, the report related. Christie said the new laws will give him the authority to reform Atlantic City's "overblown municipal government," the report further related. The deal reached ended a nearly five-month-long political fight that pushed the resort city toward bankruptcy and spared it from an immediate state takeover for at least five months, the report added. The city government has five months to draw up plans to balance its books over the next five years, Christie said, the report said. * * * The Troubled Company Reporter, on May 9, 2016, reported that S&P Global Ratings has lowered its rating on Atlantic City, N.J.'s general obligation (GO) debt to 'CC' from 'CCC-'. The outlook is negative. The rating action resolves the CreditWatch Developing that we placed on the rating on Jan. 22, 2016. "The downgrade reflects our opinion that a default or debt restructuring appears to be a virtual certainty even under the most optimistic circumstances," said S&P Global credit analyst Timothy Little. The TCR, on April 6, 2016, reported that Moody's Investors Service has downgraded the City of Atlantic City, NJ's General Obligation rating to Caa3 from Caa1 and removes the rating from review for possible downgrade started on Jan. 29, 2016, affecting $16 million of $345 million in general obligation bonds outstanding. The outlook is negative. The downgrade to Caa3 reflects the greater likelihood of default within the next year and higher probability of significant bondholder impairment given an ongoing political stalemate over an Atlantic City fiscal rescue package. The downgrade also incorporates renewed signals from the state that bondholders will face losses as part of a possible debt restructuring. The Caa3 rating indicates an expected loss to bondholders of up to 35% of principal, in light of the city's very large structural deficit with limited sources of relief without state assistance. The TCR on March 11, 2016, reported that Moody's Investors Service has released a scenario analysis of possible outcomes for Atlantic City, NJ (Caa1 review for downgrade) as the New Jersey (A2 negative) legislature considers rescue legislation and greater influence in placing it on the path to fiscal recovery. "Without drastic action, Atlantic City could face a default as early as April or May. The city also owes $190 million to casinos that successfully appealed their property taxes. Factoring in these liabilities, we project a budget deficit of $102 million in fiscal 2016, ending December 31," Josellyn Yousef, a Moody's VP -- Senior Analyst says in "Atlantic City, NJ: Rescue Legislation Key to Fiscal Recovery." The TCR, on Feb. 3, 2016, reported that 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. The TCR, on Feb. 1, 2016, reported that Standard & Poor's Ratings Services has lowered its underlying rating on Atlantic City Board of Education, N.J.'s existing general obligation (GO) bonds to 'BB-' from 'BBB-'. At the same time, S&P removed the rating from CreditWatch negative. The outlook is negative. At the same time, S&P affirmed its 'A' school program rating. The outlook on the program rating is stable. AVAYA INC: Files Conflicts Minerals Report with SEC --------------------------------------------------- In accordance with Rule 13p-1 under the Securities Exchange Act of 1934, as amended, Avaya Inc. has filed a Specialized Disclosure Report and the Conflict Minerals Report for the year ended Dec. 31, 2015. The Conflict Minerals Report is available for free at https://is.gd/oXqpqh About Avaya Avaya is a leading provider of solutions that enable customer and team engagement across multiple channels and devices for better customer experience, increased productivity and enhanced financial performance. Its world-class contact center and unified communications technologies and services are available in a wide variety of flexible on-premise and cloud deployment options that seamlessly integrate with non-Avaya applications. The Avaya Engagement Environment enables third parties to create and customize business applications for competitive advantage. Avaya's fabric-based networking solutions help simplify and accelerate the deployment of business critical applications and services. For more information please visit http://www.avaya.com/ As of March 31, 2016, Avaya had $6.68 billion in total assets, $10.18 billion in total liabilities and a total stockholders' deficiency of $3.50 billion. * * * As reported by the TCR on April 12, 2016, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on Santa Clara, Calif.-based Avaya Inc. to 'CCC' from 'B-'. Avaya carries a Caa1 corporate family rating from Moody's Investors Service. BEAR CREEK: Seeks to Hire Jaffe Raitt as Legal Counsel ------------------------------------------------------ Bear Creek Partners II, LLC and Bear Creek Retail Partners II, LLC seek approval from the U.S. Bankruptcy Court for the Western District of Michigan to hire Jaffe Raitt Heuer & Weiss, P.C. as its legal counsel. The standard hourly rates of the attorneys and paraprofessionals designated to represent the Debtors range from $285 to $600 for partners; $190 to $350 for associates; $100 to $225 for paralegals: Paul Hage, Esq., a partner at Jaffe Raitt, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Jaffe Raitt can be reached through: Jay L. Welford, Esq. Richard E. Kruger, Esq. Paul R. Hage, Esq. Jaffe Raitt Heuer & Weiss, P.C. 27777 Franklin Road, Suite 2500 Southfield, MI 48034 Phone: (248) 351-3000 jwelford@jaffelaw.com rkruger@jaffelaw.com phage@jaffelaw.com About Bear Creek Partners Bear Creek Partners II, L.L.C. and Bear Creek Retail Partners II LLC filed separate Chapter 11 petitions (Bankr. W.D. Mich. Case Nos. 16-02553 and 16-02554) on May 6, 2016. Hon. John T. Gregg presides over the cases. Each of Bear Creek Partners II and Bear Creek Retail Partners estimated $10 million to $50 million in both assets and liabilities. The petitions were signed by Scott A. Chappelle, president. BEN MOSS: Can Restructure Under CCAA, A&M Named as Monitor ---------------------------------------------------------- Ben Moss Jewellers Western Canada Ltd. said it commenced proceedings under the Companies' Creditors Arrangement Act and was granted an order by the Ontario Superior Court of Justice on May 18, 2016. The order, among other things, imposed a stay of the proceedings against the creditors of the company. Pursuant to the order, Alvarez & Marsal Canada Inc. was appointed monitor of the business and financial affairs of the company. Information on the CCAA proceedings is available on the monitor's website at http://www.alvarezandmarsal.com/benmoss. The monitor will post additional relevant information and documentation related to these proceedings on the monitor's website as they become available. For further information, contact the monitor directly at: Alvarez & Marsal Canada Inc. Royal Bank Plaza, South Tower 200 Bay Street, Suite 2900 P.O. Box 22 Toronto, ON M5J 2J1 Attention: Ben Moss Monitor Hotline: 1-855-499-1480 Email: monitor.benmoss@alvarezandmarsal.com Based in Winnipeg, Canada, Ben Moss Jewellers Western Canada Ltd. -- http://www.benmoss.com-- owns and operates jewellery stores. The company offers diamond rings, engagement rings, anniversary rings, wedding bands, necklaces, bracelets, earrings and mens jewellery. BREITBURN ENERGY: DIP Facility Approved on Interim -------------------------------------------------- Judge Stuart M. Bernstein of the U.S. Bankruptcy Court for the Southern District of New York, authorized Breitburn Energy Partners LP and its affiliated Debtors to enter into a revolving senior secured postpetition credit facility on an interim basis from Wells Fargo Bank, National Association, as DIP Agent and the Lenders party thereto. The DIP Facility contains, among others, the following relevant terms: (1) DIP Facility: A secured revolving credit facility of up to $150 million. (2) Borrowing Limits: Upon entry of the Interim Order, $75 million, including $75 million available letters of credit. Following entry of the Final Order, and subject to then terms of the DIP Credit Agreement for the potential for an additional $75 million. (3) Budget: Use of cash collateral and proceeds of the DIP Facility are subject to a Budget, consisting of monthly statements of the Debtors’ forecasted receipts and disbursements on a consolidated basis on a rolling 13-week basis. The Debtors’ actual disbursements in a month may be 15% greater in the aggregate than their forecasted disbursements ("Permitted Variance"). The Debtors are permitted to use forecasted but unused disbursements in each month (a "Carryforward") in future months. The allowed fees and expenses of professionals retained at any time in the cases ("Professional Fees") are not subject to the Budget. (4) Use of DIP Proceeds: Subject to the Budget, the Debtors may use proceeds of the DIP Facility to fund working capital, general corporate purposes, and the administration of the chapter 11 cases. (5) Interest Rates: Base Rate Option: 4.75 % + the greatest of (i) the DIP Agent’s publicly announced "reference rate"; (ii) one-half of one percent per annum above the Federal Funds Rate; and (iii) one-month LIBOR + 1.00%. LIBOR Option: 5.75% + one-month LIBOR. Default Interest Rate: 2.00% per annum in excess of the applicable non- default rate. (6) Maturity Date: The earliest of the following: (a) Jan. 15, 2017; (b) the date upon which the Interim Order expires if the Final Order has not been entered; (c) 60 days after the entry of the Interim Order, if the Final Order has not been entered prior to the expiration of such period; (d) if a chapter 11 plan has been confirmed by order of the Bankruptcy Court, the effective date of such chapter 11 plan; (e) the closing of a sale of substantially all of the equity or assets of the Debtors; (f) the date of indefeasible prepayment in cash in full by the Debtors of all DIP Obligations in accordance with the terms hereof and thereof; and (g) the date of termination of the commitments and/or acceleration of any outstanding extensions of credit following the occurrence and during the continuance of an event of default under the DIP Facility. The Debtors required the financing available under the DIP Facility and the use of cash collateral to have sufficient liquidity to operate their business and administer their estates during the chapter 11 cases. The Debtors contended that as a result of a dramatic prepetition decline in oil and gas prices, the Debtors have been unable to generate operating revenues at their historical rates. The Debtors further contended that all of their cash is subject to the liens of their secured creditors. The Debtors averred that the DIP Facility and the use of cash collateral is a critical, value-maximizing element of their reorganization. Limited Objection to Motion The Ad Hoc Group of Holders of 7.875% Senior Unsecured Notes due 2022 and 8.625% Senior Unsecured Notes due 2020 tells the Court that it does not take issue with the Debtors obtaining postpetition financing or authorization to use cash collateral on an interim basis to the extent such relief is necessary to facilitate a successful restructuring on the level playing field. The Ad Hoc Group further tells the Court that it brings its limited objection to challenge the provisions of the proposed Interim Order that likely would have the effect of prematurely limiting, or even negating, the Debtors' ability to maintain a level playing field among creditors. A full-text copy of the Order, dated May 16, 2016, is available at https://is.gd/C2iyNd Breitburn Energy Partners LP and its affiliated debtors are represented by: Ray C. Schrock, Esq. Stephen Karotkin, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Telephone: (212)310-8000 Facsimile: (212)310-8007 E-mail: ray.schrock@weil.com stephen.karotkin@weil.com The Ad Hoc Group of holders of 7.875% Senior Unsecured Notes due 2022 and 8.625% Senior Unsecured Notes due 2020 is represented by: Gregory A. Bray, Esq. Paul S. Aronzon, Esq. MILBANK, TWEED, HADLEY & MCCLOY LLP 601 South Figueroa Street 30th Floor Los Angeles, CA 90017 Telephone: (213)892-4000 E-mail: gbray@milbank.com paronzon@milbank.com - and - Andrew M. Leblanc, Esq. Alexander B. Lees, Esq. MILBANK, TWEED, HADLEY & MCCLOY LLP 1850 K Street, NW, Suite 1100 Washington, DC 20006 Telephone: (202)835-7500 E-mail: aleblanc@milbank.com alees@milbank.com About Breitburn Energy Partners Breitburn Energy Partners LP and 21 of its affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York on May 15, 2016, listing assets of $4.71 billion and liabilities of $3.41 billion. Breitburn Energy et al., are an independent oil and gas partnership engaged in the acquisition, exploitation and development of oil and natural gas properties, Midstream Assets, and a combination of ethane, propane, butane and natural gasolines that when removed from natural gas become liquid under various levels of higher pressure and lower temperature, in the United States. The Debtors conduct their operations through Breitburn Parent's wholly-owned subsidiary, Breitburn Operating LP, and BOLP's general partner, Breitburn Operating GP LLC. As of the Petition Date, the Debtors operate, or have working interests in approximately 11,900 gross operating oil and gas wells, and 7,921 net oil and gas wells. The Debtors own interests in approximately 705,597 net acres and had estimated proved reserves, as of Dec. 31, 2015, of 239.3 million barrels of oil equivalent of which approximately 54% was oil, 8% was NGLs, and 38% was natural gas. The Debtors maintain operational control over approximately 91% of their proved reserves. The Debtors' production in 2015 was 20.8 million barrels of oil equivalent, of which approximately 56% was oil, 9% was NGLs and 35% was natural gas. The Debtors have engaged Weil Gotshal & Manges LLP as counsel, Alvarez & Marsal North America, LLC as financial advisor, Lazard Freres & Co. LLC as investment banker, and Prime Clerk LLC as claims and noticing agent. The cases are pending before the Honorable Stuart M. Bernstein and are jointly administered under Case No. 16-11390. BREITBURN ENERGY: U.S. Trustee Forms 3-Member Committee ------------------------------------------------------- The U.S. trustee for Region 2 on May 26 appointed three creditors of Breitburn Energy Partners LP and its affiliates to serve on the official committee of unsecured creditors. The committee members are: (1) Ares Special Situations Fund IV, L.P. c/o Ares Management LLC 2000 Avenue of the Stars, 12th Floor Los Angeles, California 90067 Attention: Matthew F. Sheahan Telephone: (310) 201-4100 (2) BPC UKI LP c/o Beach Point Capital Management 1620 26th Street, Suite 6000N Santa Monica, California 90404 Attention: Joseph Fabiani, Vice President Telephone: (310) 996-9700 (3) Wexford Spectrum Investors, LLC 411 W. Putnam Avenue – Suite 125 Greenwich, Connecticut 06830 Attention: Marc McCarthy Telephone: (203) 862-7013 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at a debtor's expense. They may investigate the debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. About Breitburn Energy Breitburn Energy Partners LP and 21 of its affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York on May 15, 2016, listing assets of $4.71 billion and liabilities of $3.41 billion. Breitburn Energy et al. are an independent oil and gas partnership engaged in the acquisition, exploitation and development of oil and natural gas properties, Midstream Assets, and a combination of ethane, propane, butane and natural gasolines that when removed from natural gas become liquid under various levels of higher pressure and lower temperature, in the United States. The Debtors conduct their operations through Breitburn Parent's wholly-owned subsidiary, Breitburn Operating LP, and BOLP's general partner, Breitburn Operating GP LLC. As of the Petition Date, the Debtors operate, or have working interests in approximately 11,900 gross operating oil and gas wells, and 7,921 net oil and gas wells. The Debtors own interests in approximately 705,597 net acres and had estimated proved reserves, as of Dec. 31, 2015, of 239.3 million barrels of oil equivalent of which approximately 54% was oil, 8% was NGLs, and 38% was natural gas. The Debtors maintain operational control over approximately 91% of their proved reserves. The Debtors' production in 2015 was 20.8 million barrels of oil equivalent, of which approximately 56% was oil, 9% was NGLs and 35% was natural gas. The Debtors have engaged Weil Gotshal & Manges LLP as counsel, Alvarez & Marsal North America, LLC as financial advisor, Lazard Freres & Co. LLC as investment banker, and Prime Clerk LLC as claims and noticing agent. The cases are pending before the Honorable Stuart M. Bernstein and are jointly administered under Case No. 16-11390. BRUNSWICK CORP: Moody's Puts Ba1 Ratings on Review for Upgrade -------------------------------------------------------------- Moody's Investors Service placed the senior unsecured notes rating for Brunswick Corporation under review for upgrade. The review is driven by Brunswick's improved credit profile and Moody's view that the company would maintain a solid credit profile in a moderate to severe economic downturn. Brunswick's Corporate Family Rating, Probability of Default Rating and Speculative Grade Liquidity rating are not under review; however, these will be withdrawn if the ratings that have been placed under review are upgraded. RATING RATIONALE Brunswick's existing ratings reflect the company's strong position in the fitness and leisure marine sectors and strong credit metrics -- highlighted by debt/EBITDA below 1.5 times and strong liquidity. The ratings are constrained by the discretionary nature of pleasure boats and marine related products, which makes Brunswick's revenues and earnings sensitive to economic weakness. The rationale for the review for upgrade is Moody's expectation that the company's continued strong operating performance, liquidity and strong credit metrics will enable it to maintain a solid credit profile even in a severe economic decline. Moody's rating review will focus on the operational and financial steps Brunswick would take in an economic downturn to preserve its credit profile and liquidity. It will also focus on management's expectation of how each of its different business segments would perform in a significant economic downturn. Ratings Placed Under Review For Upgrade: $150 million senior unsecured notes with subsidiary guarantees due 2021 at Ba1 (LGD 3); Senior unsecured and unguaranteed notes due 2023-2027 at Ba2 (LGD 6) Subscribers can find further details in the Brunswick Credit Opinion published on Moodys.com. Brunswick, headquartered in Lake Forest, Illinois, manufactures marine engines, pleasure boats and fitness equipment. Revenue for the twelve months ended March 2016 approximated $4.2 billion. BUILDERS FIRSTSOURCE: WP IX Sells Entire Stake to Credit Suisse --------------------------------------------------------------- In an amended Schedule 13D filed with the Securities and Exchange Commission, Warburg Pincus Private Equity IX, L.P. ("WP IX"), et al., disclosed that as of May 24, 2016, they ceased to beneficially own shares of common stock of Builders Firstsource, Inc. On May 18, 2016, WP IX offered 13,263,266 shares of Common Stock of the Company for sale in a public offering pursuant to a prospectus supplement filed with the SEC by the Company on May 18, 2016, pursuant to Rule 424(b)(5) under the Securities Act. On May 24, 2016, WP IX consummated the sale of 13,263,266 shares of Common Stock of the Company to Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc., as underwriters, at a price per share of $10.40 pursuant to the Underwriting Agreement dated May 18, 2016. A copy of the regulatory filing is available for free at: https://is.gd/1clKy2 About Builders FirstSource Headquartered in Dallas, Texas, Builders FirstSource -- http://www.bldr.com/-- is a supplier and manufacturer of structural and related building products for residential new construction. The Company operates 56 distribution centers and 56 manufacturing facilities in nine states, principally in the southern and eastern United States. Manufacturing facilities include plants that manufacture roof and floor trusses, wall panels, stairs, aluminum and vinyl windows, custom millwork and pre-hung doors. Builders FirstSource also distributes windows, interior and exterior doors, dimensional lumber and lumber sheet goods, millwork and other building products. Builders Firstsource reported a net loss of $22.8 million on $3.56 billion of sales for the year ended Dec. 31, 2015, compared to net income of $18.2 million on $1.60 billion of sales for the year ended Dec. 31, 2014. * * * As reported by the TCR on July 15, 2015, Standard & Poor's Ratings Services said it raised its corporate credit rating on Builders FirstSource Inc. to 'B+' from 'B'. "The stable outlook reflects our view that Builders FirstSource will continue to increase sales and EBITDA as U.S. residential construction continues to recover from an historic downturn and the company realizes significant synergies from the merger. As a result, we expect some improvement in the company's leverage measures over the next 12 to 24 months while it maintains adequate liquidity," said Standard & Poor's credit analyst Pablo Garces. In the May 13, 2014, edition of the TCR, Moody's Investors Service upgraded Builders FirstSource's Corporate Family Rating to 'B3' from 'Caa1'. The upgrade reflects Moody's expectation that BLDR's operating performance will continue to benefit from improved housing construction, repair and remodeling. CADILLAC NURSING: Trustee Amends Notice of Committee Appointment ---------------------------------------------------------------- The U.S. trustee for Region 9 on May 26 filed an amended notice of appointment of an official committee of unsecured creditors of Cadillac Nursing Home, Inc. The bankruptcy watchdog amended the notice to delete the information erroneously included as to Rehab Solutions, and to provide contact information for Chiman Patel: (1) Jonah Geisler Tristate Surgical Supply & Equipment 409 Hoyt St. Brooklyn, New York 11231 Phone: 908-692-9402 Fax: 718-624-0666 Email: JONAH@Tristatesurgical.com (2) Chiman Patel 27950 Orchard Lake Road Suite 112 Farmington Hills, Michigan 48334 Phone: 248-910-5843 Email: kcbpatel@gmail.com About Cadillac Nursing Home Cadillac Nursing Home, Inc. sought protection under Chapter 11 of the Bankruptcy Code in the Eastern District of Michigan (Detroit) (Case No. 16-41554) on February 8, 2016. The petition was signed by Bradley Mali, president. The Debtor is represented by Michael E. Baum, Esq., Kim K. Hillary, Esq., and John J. Stockdale, Jr., Esq., at Schafer and Weiner, PLLC. The case is assigned to Judge Thomas J. Tucker. The Debtor estimated both assets and liabilities in the range of $1 million to $10 million. CALATLANTIC GROUP: Moody's Rates Proposed $300M Notes 'Ba2' ----------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to CalAtlantic Group, Inc.'s proposed $300 million senior unsecured notes due 2026. The proceeds of the notes will be used to repay or repurchase the company's $280 million of senior unsecured notes due in September of 2016 with the remainder being used toward general corporate purposes. CalAtlantic's Corporate Family Rating is unchanged at Ba2 and outlook is stable. The following rating actions were taken: Proposed $300 million senior unsecured notes, assigned Ba2 (LGD4). RATINGS RATIONALE The Ba2 Corporate Family Rating reflects CalAtlantic's good business profile as a result of the merger between Standard Pacific and Ryland. The combined entity is now the fourth largest homebuilder in the United States based on pro forma revenues of just under $5.5 billion for the twelve months trailing March 31, 2016 and CalAtlantic's portfolio of markets is well diversified and stretched across the country, covering 17 states and 41 metropolitan areas. Moreover, the company offers a wide range of products at various price points, allowing it to capture customers from entry level to luxury. The Ba2 Corporate Family Rating is also supported by CalAtlantic's credit metrics, specifically its adjusted debt to book capitalization ratio which stood at 48.4% at March 31, 2016. Moody's expects this figure to come down below 45% in 2016 as it reduces its revolver borrowings and generates equity through retained earnings. At the same time, CalAtlantic's rating is constrained by the overhang of integration risk that springs from combining two large entities. While the integration has thus far gone well for the company, Moody's believes the merger of two large homebuilders with overlapping divisions will require more time before the risks reside. The SGL-2 Speculative Grade Liquidity (SGL) Rating reflects CalAtlantic's good liquidity position and takes into consideration internal liquidity, external liquidity, covenant compliance, and alternative liquidity. As of March 31, 2016, the company had $170 million of cash on the balance sheet. Moody's expects the company to turn free cash flow positive in 2016 and maintain this sizable cash balance, both of which support its liquidity profile. CalAtlantic's has a $750 million revolving credit facility that, as of March 31, 2016, had $373 million available to be drawn. The credit facility is subject to a series of covenants including a minimum tangible net worth of $1.65 billion, a maximum net homebuilding leverage ratio of 2.0 to 1.0 and a minimum EBITDA interest coverage of 1.25x. Moody's projects the company to have significant cushion under each of these for the next 12 to 18 months. CalAtlantic's debt capital structure is unsecured, giving it ample alternative liquidity options with its unencumbered land supply. The stable outlook reflects that the company's credit metrics are anticipated to improve over the next 12-18 months as industry conditions steadily advance. The ratings could be upgraded if the company's homebuilding debt to capitalization is sustained below 40%, homebuilding interest coverage is close to 6.0x, and homebuilding gross margins are well above 20%. The ratings could be downgraded if homebuilding debt to capitalization increases above 50% on a sustained basis, homebuilding interest coverage falls below 3.5x, there is a deterioration in profitability or weakening of industry conditions, or if the company engages in any sizable acquisition and/or shareholder friendly activities. Headquartered in Irvine, California and formed by the 2015 merger of Standard Pacific Corp. and The Ryland Group, Inc., CalAtlantic Group, Inc. ("CalAtlantic") constructs and sells single-family attached and detached homes. The company operates in 41 metropolitan statistical areas (MSAs) and is in the entry-level, move-up, luxury, and active adult segments. CalAtlantic is the fourth largest homebuilder in the United States with pro forma revenues for the trailing twelve months (TTM) March 31, 2016 of $5.5 billion. CAPITAL L. CORP: Seeks to Hire Brouse McDowell as Legal Counsel --------------------------------------------------------------- Capital L. Corp. seeks approval from the U.S. Bankruptcy Court for the Northern District of Ohio to hire Brouse McDowell, LPA as its bankruptcy counsel. The Debtor tapped the firm to provide these services: (a) provide advice about its power and duties as debtor-in- possession; (b) advise the Debtor on all bankruptcy matters; (c) prepare legal papers; (d) represent the Debtor at all hearings; (e) prosecute and defend litigated matters; (f) prepare and file a disclosure statement and negotiate and implement a plan of reorganization; (g) negotiate and seek approval of a sale of the Debtor's assets and other transactions; (h) represent the Debtor on matters related to the assumption or rejection of its executory contracts and leases; and (i) advise the Debtor about corporate, real estate, litigation, labor, finance, tax and other legal matters. These attorneys and staff are anticipated to assist the Debtor during its bankruptcy: Professionals Hourly Rates ------------- ------------ Marc Merklin $425 Kate Bradley $325 Lucas Blower $300 Thomas Gattozzi $320 Bridget Franklin $265 Theresa Palcic $165 Mark Merklin, Esq., a principal at Brouse McDowell, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Mark B. Merklin Kate M. Bradley Brouse McDowell, LPA 388 S. Main Street, Suite 500 Akron, Ohio 44311 Phone: (330) 535-5711 Fax: (330) 253-8601 mmerklin@brouse.com kbradley@brouse.com About Capital L. Corp. Capital L. Corp. sought protection under Chapter 11 of the Bankruptcy Code in the Northern District of Ohio (Akron) (Case No. 16-50850) on April 13, 2016. The petition was signed by Louis Telerico, president. The case is assigned to Judge Alan M. Koschik. The Debtor estimated both assets and liabilities in the range of $1 million to $10 million. CARL EQUIPMENT: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Carl Equipment, Ltd. 6400 Industrial Blvd. Greeenville, TX 75402 Case No.: 16-32076 Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Hon. Stacey G. Jernigan Debtor's Counsel: Joyce W. Lindauer, Esq. JOYCE W. LINDAUER ATTORNEY, PLLC 12720 Hillcrest Road, Suite 625 Dallas, TX 75230 Tel: (972) 503-4033 Fax: (972) 503-4034 E-mail: joyce@joycelindauer.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Marcus D. Carl, vice president. The Debtor did not include a list of its largest unsecured creditors when it filed the petition. CELTIC CONCEPTS: Seeks to Hire Wauson & Probus as Legal Counsel --------------------------------------------------------------- Celtic Concepts, Ltd. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Wauson & Probus as its legal counsel. The Debtor proposed to hire the firm to provide these services: (a) provide advice to the Debtor regarding its continued operation and management of cash and property; (b) prepare and file the Debtor's schedules, statements of financial affairs and related initial pleadings; (c) represent the Debtor at its initial meeting with the U.S. trustee and at its first meeting of creditors; (d) represent the Debtor in post-petition administrative matters or matters involving its assets and liabilities and financial affairs; (e) represent the Debtor in any adversary proceeding related to pre-bankruptcy transfers; (f) represent the Debtor in negotiations for any post- petition administrative financing; (g) represent the Debtor in negotiations for its use of cash collateral; (h) represent the Debtor in negotiations for the assumption or rejection of any unexpired leases of nonresidential property; (i) assist the Debtor in preparing a disclosure statement and plan of reorganization; (j) represent the Debtor with respect to objections to proofs of claim and allowance or disallowance of claims; and (k) represent the Debtor with respect to the consummation of a plan of reorganization and other post-petition matters necessary to its implementation. The Debtor will employ the firm on an hourly basis. The attorneys who may represent the Debtor and their discounted hourly rates are: John Wesley Wauson $450 Matthew Probus $350 Anabel King $200 Sharon Dianiska and Ginger Davis, both paraprofessionals, may also assist the Debtor. Ms. Dianiska will be paid $100 per hour while Ms. Davis will be paid $65 per hour. Matthew Probus, a shareholder of Wauson & Probus, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Wauson & Probus can be reached through: Matthew B. Probus Wauson & Probus One Sugar Creek Center Blvd., Suite 880 Sugar Land, Texas 77478 Phone: (281) 242-0303 Fax: (281) 242-0306 About Celtic Concepts Celtic Concepts, Ltd. sought protection under Chapter 11 of the Bankruptcy Code in the Southern District of Texas (Houston) (Case No. 16-32610) on May 24, 2016. The petition was signed by Brian Young, president of Ceana, LLC general partner. The case is assigned to Judge Marvin Isgur. The Debtor estimated assets of $100,000 to $500,000 and debts of $1 million to $10 million. CENGAGE LEARNING: Moody's Cuts Sr. Unsecured Term Loan Rating to B1 ------------------------------------------------------------------- Moody's Investors Service downgrades Cengage Learning, Inc.'s proposed upsized $1,710 million Senior Secured Term Loan to B1 (LGD3) due to reduced structural subordination and support provided by lower amount of proposed Senior Unsecured Notes of $620 million. Moody's affirms Cengage Learning, Inc. B2 Corporate Family Rating (CFR) and Probability of Default Rating B2-PD after announcement in capital structure modification which is not expected to result in a change to total debt outstanding. The outlook remains stable. The issuer of the proposed debt (Cengage Learning, Inc.) was previously an operating subsidiary of Cengage Learning Acquisitions, Inc. (B2, Stable) holding the business assets, and is the surviving entity of the merger of Cengage Learning, Inc. and Cengage Learning Acquisitions, Inc. Moody's will withdraw all ratings for Cengage Learning Acquisitions, Inc. upon closing of the transaction. Cengage Learning Acquisitions, Inc.: -- Corporate Family Rating, ratings to be withdrawn B2 -- Probability of Default Rating, ratings to be withdrawn B3-PD -- $2.01 billion Senior Secured Term Loan due 2020, ratings to be withdrawn B2, LGD3 Outlook Action: -- Outlook is Stable to be withdrawn Cengage Learning, Inc. Ratings Affirmed Corporate Family Rating, B2 Probability of Default Rating B2-PD $620 million Senior Unsecured Notes due 2024; Caa1, LGD5 Ratings Downgrades $1,710 million Senior Secured Term Loan due 2023: to B1, LGD3 from Ba3, LGD3 Outlook: Outlook is Stable RATINGS RATIONALE Cengage's B2 CFR rating reflects Moody's expectation for low single digit percentage declines in enrollment levels for U.S. institutions of higher education, consumer focus on containing education costs, competition among leading players especially as the market transitions to digital services from traditional learning materials, and high event risk related to ownership by financial sponsors. Ratings reflect the company's high leverage of 5.3x debt-to-cash EBITDA pro-forma for the proposed transaction (including Moody's standard adjustments and cash pre-publication costs as an expense), making the company more sensitive to underlying business deterioration. Moody's is increasingly concerned over the company's financial policy as it continues to use its cash towards dividend distributions and share repurchases. Moody's expects leverage to return to approximately 5x over the next 12 months, as actioned cost savings are realized. The current rating and outlook do not incorporate any further share repurchases or debt funded distributions, which if occur, may result in a negative rating action. Moody's expects Cengage to maintain mid-single digit percentage free cash flow-to-debt or better absent any further shareholder distributions. While Cengage has successfully been able to maintain its market share within a challenged higher education market, and made strong strides towards growing its digital portfolio, the company's financial policy pressures the B2 Corporate Family Rating. Including the proposed special dividend and the share repurchases executed over the past 12 months, the company will have returned nearly one year worth of its Cash EBITDA for FY 2016, limiting the de-levering of the issuer. The company generated $460 million in cash EBITDA during FY 2016 (including Moody's standard adjustments and cash pre-publication costs as an expense) and estimated $150 million in free cash flow, ending the year with a cash balance of $254 million. Ratings could be downgraded if market conditions or competitive pressures lead to Cengage being unable to track revenue or EBITDA expectations resulting in debt-to-cash EBITDA remaining above 5x (including Moody's standard adjustments and cash prepublication costs as an expense) over the next 12 months. Ratings could also be downgraded if additional debt funded distributions lead to increased leverage or if liquidity were to weaken due to significant revolver usage or free cash flow-to-debt falling below mid-single digit percentages. Moody's said, "given weak position of the credit within its corporate family rating, upgrade is unlikely. Ownership by financial sponsors and the likelihood of additional distributions pressure debt ratings, but we could consider a rating upgrade if U.S. enrollment levels stabilize and if Cengage is able to consistently grow revenue and maintain its market share. The company would also need to demonstrate EBITDA growth resulting in debt-to-cash EBITDA being sustained comfortably below 3x, and we would need to expect that liquidity will remain good with cash balances being more than sufficient to cover outflows including seasonal working capital swings and with free-cash flow-to-debt being sustained in the low to mid double-digit percentage range or better." Cengage Learning, Inc. ("Cengage") is a provider of learning solutions, software and educational services for the higher education, research, school, career, professional, and international markets. Cengage publishes college textbooks and reference materials, and supplements its print publications with digital solutions. The company emerged from Chapter 11 bankruptcy protection in March 2014 with reduced debt levels. Large shareholders currently include Apax Partners, KKR and Searchlight Capital as well as other creditors who became shareholders upon exit. Revenue for the FY ended March 31, 2016 totaled $1.6 billion. CHAMPION INDUSTRIES: Files Amendment #3 to Schedule 13E-3 --------------------------------------------------------- Champion Industries, Inc., filed a third amended to its transaction statement on Schedule 13E-3 to reflect revisions in response to SEC staff comments in the comment letter date May 24, 2016. The following persons, who are directors and/or executive officers and 10% or more shareholders of the Company, have joined and adopted the Schedule 13E-3 as additional filing persons: Marshall T. Reynolds Chairman of the Board of Directors and controlling shareholder (Mr. Reynolds beneficially owns or controls approximately 53.7% of the Company's outstanding Class A Common Stock, as disclosed in the Proxy Statement, including shares owned by Harrah and Reynolds Corporation in which Mr. Reynolds is the sole shareholder.) Harrah and Reynolds Corporation 10% or more shareholder (this corporation owns approximately 37.5% of the outstanding Class A Common Stock of the Company as disclosed in the Proxy Statement. Mr. Reynolds owns all the stock of, and controls, Harrah and Reynolds Corporation.) Glenn W. Wilcox, Sr. Director (Mr. Wilcox beneficially owns or controls approximately 1.1% of the Company’s outstanding Class A Common Stock, as disclosed in the Proxy Statement.) Phillip E. Cline Director (Mr. Cline beneficially owns or controls approximately 0.57% of the Company's outstanding Class A Common Stock, as disclosed in the Proxy Statement.) Neal W. Scaggs Director (Mr. Skaggs beneficially owns or controls approximately 0.6% of the Company's outstanding Class A Common Stock, as disclosed in the Proxy Statement.) Louis J. Akers Director (Mr. Akers beneficially owns or controls approximately 0.1% of the Company's outstanding Class A Common Stock, as disclosed in the Proxy Statement.) Adam M. Reynolds President and Chief Executive Officer (Mr. Adam M. Reynolds owns or controls approximately 0.3% of the Company's outstanding Class A Common Stock, as disclosed in the Proxy Statement.) Justin T. Evans Senior Vice President and Chief Financial Officer A copy of the regulatory filing is available for free at: https://is.gd/eAUE9Y About Champion Industries Champion Industries, Inc., is engaged in the commercial printing and office products and furniture supply business in regional markets east of the Mississippi River. The Company also publishes The Herald-Dispatch daily newspaper in Huntington, West Virginia with a total daily and Sunday circulation of approximately 23,000 and 28,000. Champion Industries reported a net loss of $1.19 million on $61.28 million of total revenues for the year ended Dec. 31, 2015, compared to a net loss of $1.13 million on $63.52 million of total revenues for the year ended Oct. 31, 2014. As of Jan. 31, 2016, the Company had $22.89 million in total assets, $21.15 million in total liabilities and $1.74 million in total shareholders' equity. CHRIST FELLOWSHIP: U.S. Trustee Unable to Appoint Committee ----------------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Christ Fellowship, Inc. Christ Fellowship, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 16-10673) on April 4, 2016. The Debtor is represented by J. Nevin Smith, Esq., at Smith Conerly LLP. CLAIRE'S STORES: Reports Fiscal 2016 First Quarter Results ---------------------------------------------------------- Claire's Stores, Inc., reported its financial results for the fiscal 2016 first quarter, which ended April 30, 2016. The Company reported a net loss of $38.8 million on $300 million of net sales for the three months ended April 30, 2016, compared to a net loss of $35.4 million on $320 million of net sales for the three months ended May 2, 2015. As of April 30, 2016, Claire's Stores had $2.27 billion in total assets, $2.87 billion in total liabilities and a stockholders' deficit of $606 million. Adjusted EBITDA in the fiscal 2016 first quarter was $37.0 million compared to $37.6 million last year. Adjusted EBITDA would have been $38.9 million excluding both foreign currency translation effect and the unfavorable foreign exchange effect on merchandise margin in the first quarter of 2016. The Company defines Adjusted EBITDA as earnings before income taxes, net interest expense, depreciation and amortization, loss (gain) on early debt extinguishments, and asset impairments. Adjusted EBITDA excludes management fees, severance, the impact of transaction-related costs and certain other items. As of April 30, 2016, cash and cash equivalents were $48.9 million. The Company was fully drawn on its Credit Facilities as of April 30, 2016. The fiscal 2016 first quarter cash balance increase of $30.0 million consisted of positive impacts of $37.0 million of Adjusted EBITDA and $116.9 million from net borrowings under the Credit Facilities, offset by reductions for $79.0 million of cash interest payments, $36.1 million from seasonal working capital uses, $4.3 million of capital expenditures and $4.5 million for tax payments and other items. A full-text copy of the press release is available for free at: https://is.gd/AuY4iG About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. * * * The TCR reported on April 11, 2016, that Moody's Investors Service downgraded Claire's Stores, Inc. Corporate Family Rating (CFR) and Probability of Default Rating to Caa3 and Caa3-PD, respectively. "[The] downgrades reflect our view that there is an acute likelihood of a debt restructuring ahead of the June 2017 maturity of Claire's subordinated notes due to continuing erosion of liquidity and weak operating performance," stated Moody's Vice President Charlie O'Shea. As reported by the TCR on May 20, 2016, S&P Global Ratings raised its corporate credit rating on Florida-based Claire's Stores Inc. to 'CCC-' from 'SD'. The outlook is negative. COMPACT UNLIMITED: Seeks to Hire Durand as Legal Counsel -------------------------------------------------------- Compaction Unlimited LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Texas to hire Daniel Durand III of Durand & Associates PC as its legal counsel. Compaction Unlimited proposed to hire an attorney to provide advice about its rights, powers and duties as debtor-in-possession, prepare legal papers, and represent the Debtor at all hearings and meetings of creditors. Mr. Durand, Esq., will be paid $300 per hour for his services. In a court filing, Mr. Durand disclosed that he does not hold or represent an interest adverse to the Debtor's estate. The proposed counsel can be reached through these numbers: Daniel Durand III Durand & Associates PC, 522 Edmonds, Suite 101 Lewisville, TX 75067 Tel: (972) 221-5655 Fax: (972) 221-9569 About Compaction Unlimited Compaction Unlimited LLC sought protection under Chapter 11 of the Bankruptcy Code in the Eastern District of Texas (Case No. 16-40928) on May 24, 2016. COMPUTER SCIENCES: Moody's Affirms Ba1 Stock Shelf Rating --------------------------------------------------------- Moody's Investors Service affirmed Computer Sciences Corporation's senior unsecured rating at Baa2 following the company's announcement that it plans to merge with Hewlett Packard Enterprise Company's Enterprise Services business ("HPE Services") in a tax free transaction. The boards of directors of both companies have approved the transaction. CSC expects the merger to close by the end of March 2017, subject to customary conditions including regulatory approvals. The outlook is stable. Outlook Actions: Issuer: Computer Sciences Corporation Outlook, Remains Stable Affirmations: Issuer: Computer Sciences Corporation Preferred Stock Shelf, Affirmed (P)Ba1 Subordinate Shelf, Affirmed (P)Baa3 Senior Unsecured Shelf, Affirmed (P)Baa2 Senior Unsecured Regular Bond/Debentures, Affirmed Baa2 RATINGS RATIONALE The Baa2 rating reflects Moody's expectation of moderate leverage for CSC and enhanced scale following its merger with HPE Services, which should help to offset the challenges of integrating a business with more than double the revenues of CSC. The combination will diversify CSC's business profile while potentially increasing profitability with sizable cost saving opportunities (e.g., balancing the workforce, eliminating duplicate costs from SG&A support functions, data center and facilities consolidation, and procurement spend). However, Moody's believes there will be risk with integrating the culture of both organizations in an entity whose primary assets are its people. Shifts in labor mix, management layers, compensation, and benefits could pose risks with employee retention and morale. Moody's expects leverage to decrease to the low 2x level following the merger after considering $1 billion of cost synergies (from above 2.5x at the projected close without synergies). Since the spin-off of Computer Sciences Government Services (CSGov) in November 2015, CSC has been acquisitive with the purchases of Xchanging plc, a provider of global insurance services and technology, in May 2016 and UXC Limited, Australia's largest independent IT services company, in March 2016 for a combined purchase price of $1 billion. Pro forma for the acquisitions of Xchanging and UXC, Moody's adjusted leverage for standalone CSC is in the high 2x range. The merger with HPE Services will be structured as a tax-free merger with the shareholders from each entity owning half of the common stock of the combined company. Moody's expects adjusted debt to EBITDA to decline to the low 2 times by the end of fiscal year ended March 2018 ("FY 2018") driven by cost synergies of $1 billion. Adjusted EBITDA should increase to more than $4.5 billion by the end of FY 2018. As part of the transaction, CSC will raise an additional $3.6 billion of debt in order to issue a $3.1 billion distribution to Hewlett Packard Enterprises (in cash and debt) and to bolster cash on hand. The merged company will also assume $300 million of Senior Notes due 2029 and a net pension liability of $570 million (on a GAAP basis) from Hewlett Packard Enterprises. While revenue declines have persisted at both CSC and HPE Services, Moody's expects that revenue from newer cloud related offerings will help to offset declines from their legacy managed services contracts. However, there remains significant uncertainty as to when overall revenues will stabilize, the pace at which the combined company's client portfolio will transition to higher margin (and less capital intensive) projects, and the amount of cost savings that will need to be re-invested into new service offerings. Moody's believes that it could take CSC at least one year to restore and sustain meaningful revenue growth. CSC's rating is supported by its strong market position in the IT services industry (e.g., the 3rd largest IT services firm following the merger with HPE Services) with a business model that has proven fairly resilient during economic downturns, producing sizable cash flow from long term contracts. CSC also benefits from its large offshore commercial business infrastructure, which will grow without the need to support the former U.S. government business, and a diversified customer base of global clients, which will further expand with HPE Services' portfolio. The stable outlook reflects Moody's expectation of low single digit revenue growth over the next year for CSC (flattish on a pro forma combined basis with HPE Services) with adjusted operating margins of about 10%. Given the merger integration, timing of new program ramps, significant cash outlays associated with restructuring actions, and reinvestments to spur long-term growth, free cash flow is likely to be volatile, but likely to exceed a $1 billion in the first year after close. Moody's also expects very limited acquisition and share buyback activity until the merger with HPE Services is well integrated. The ratings could be upgraded if CSC generates revenue growth in the mid-single digits with operating margins above 12.5% while maintaining prudent financial discipline. The ratings could be downgraded if CSC experiences extended revenue or operating margin declines. In addition, the ratings could experience downwards pressure if CSC's financial policies were to become more aggressive (e.g., through continued debt financed M&A or share repurchases) such that debt to EBITDA stays above 2.5 times on a sustained basis. The principal methodology used in these ratings was Business and Consumer Service Industry published in December 2014. Computer Sciences Corporation is a multinational information technology and business process outsourcing services provider. CYTORI THERAPEUTICS: Subscription Rights to Expire June 9 --------------------------------------------------------- Cytori Therapeutics, Inc., filed with the Securities and Exchange Commission an amended Form S-1 registration statement relating to the distribution to holders of the Company's common stock, at no charge, non-transferable subscription rights to purchase units. Each unit consists of one share of common stock and 0.5 of a warrant. Each whole Warrant will be exercisable for one share of the Company's common stock. In the Rights Offering, holders will receive one subscription right for each share of common stock owned at 5:00 p.m., Eastern Time, on May 20, 2016, the record date of the Rights Offering, or the Record Date. The common stock and the Warrants comprising the Units will separate upon the closing of the Rights Offering and will be issued separately but may only be purchased as a Unit, and the Units will not trade as a separate security. The subscription rights will not be tradable. The Subscription Rights will expire if they are not exercised by 5:00 p.m., Eastern Time, on June 9, 2016, unless the Rights Offering is extended or earlier terminated by the Company. If the Company elects to extend the Rights Offering, it will issue a press release announcing the extension no later than 9:00 a.m., Eastern Time, on the next business day after the most recently announced expiration date of the Rights Offering. The Company may extend the Rights Offering for additional periods in its sole discretion. Once made, all exercises of Subscription Rights are irrevocable. The Company has not entered into any standby purchase agreement or other similar arrangement in connection with the Rights Offering. The Rights Offering is being conducted on a best-efforts basis and there is no minimum amount of proceeds necessary to be received in order for the Company to close the Rights Offering. The Company has engaged Maxim Group LLC to act as dealer-manager in the Rights Offering. A full-text copy of the amended prospectus is available for free at https://is.gd/WrghzW About Cytori Based in San Diego, California, Cytori Therapeutics (NASDAQ: CYTX) -- http://www.cytori.com/-- is an emerging leader in providing patients and physicians around the world with medical technologies, which harness the potential of adult regenerative cells from adipose tissue. The Company's StemSource(R) product line is sold globally for cell banking and research applications. Cytori reported a net loss allocable to common stockholders of $19.4 million on $4.83 million of product revenues for the year ended Dec. 31, 2015, compared to a net loss allocable to common stockholders of $38.5 million on $4.95 million of product revenues for the year ended Dec. 31, 2015. As of March 31, 2016, Cytori had $32.9 million in total assets, $25.2 million in total liabilities and $7.74 million in total stockholders' equity. KPMG LLP, in San Diego, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company's recurring losses from operations and liquidity position raises substantial doubt about its ability to continue as a going concern. D&E GENERAL: Seeks to Hire Hodges Doughty as Legal Counsel ---------------------------------------------------------- D&E General Partnership seeks approval from the U.S. Bankruptcy Court for the Eastern District of Tennessee to hire Hodges, Doughty & Carson PLLC as its legal counsel. D&E General tapped the firm to prepare legal papers on its behalf, represent the Debtor in filing all pleadings and court appearances, and assist in resolving issues with creditors. Dean Farmer and Kandi Yeager, the attorneys who will provide the services, will be paid $300 per hour and $250 per hour, respectively. The hourly rate of associates who may assist them is $200 while the hourly rate of paralegal assistants is $95. Mr. Farmer disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Dean B. Farmer, Esq. Kandi R. Yeager, Esq. Hodges, Doughty & Carson PLLC Post Office Box 869 Knoxville, TN 37901-0869 Tel: (865)292-2307 About D&E General Partnership D&E General Partnership sought protection under Chapter 11 of the Bankruptcy Code in the Eastern District of Tennessee (Knoxville) (Case No. 16-31625) on May 24, 2016. The petition was signed by David Murray Dunlap, authorized representative. The case is assigned to Judge Suzanne H. Bauknight. The Debtor estimated both assets and liabilities in the range of $1 million to $10 million. DELPHI AUTOMOTIVE: Court Denies Summary Judgment Bids in Solus Suit ------------------------------------------------------------------- Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York denied both motions for summary judgment in the adversary case Solus Alternative Asset Management LP, Angelo Gordon & Co. L.P., Longhorn Credit Funding, LLC, Nextpoint Credit Strategies Fund, Gov Re, Ltd, Ultra Master Ltd, Sola Ltd, Solus Opportunities Fund 1 LP, Solus Opportunities Fund 2 LP, Solus Recovery Fund III Master LP, AG Super Fund International Partners, L.P., and Botticelli LLC Plaintiffs, v. Delphi Automotive PLC and Delphi Automotive LLP Defendants, and DPH Holdings Corp., Nominal Defendant, Adv. Pro. No. 14-02445 (RDD)(Bankr. S.D.N.Y.). Before the Court are the parties' respective motions for summary judgment. Both motions are premised on the asserted plain meaning of the relevant documents; no parol evidence has been offered. The plaintiffs in this adversary proceeding seek a declaration that they -- and by inference other similarly situated general unsecured creditors -- are entitled under Section 5.3 of the confirmed and consummated First Amended Joint Plan of Reorganization, dated July 30, 2009 of the debtors herein to the "General Unsecured MDA Distribution." General Unsecured MDA Distribution means, if and to the extent Company Buyer makes distributions to its members in accordance with the Company Buyer Operating Agreement, as described in section 3.2.3 of the Master Disposition Agreement, in excess of $7.2 billion, an amount equal to $32.50 for every $67.50 so distributed in excess of $7.2 billion; provided, however, that in no event shall the General MDA Distribution exceed $300,000,000 in the aggregate. The parties agree that if the March 31, 2011 redemptions of General Motors Company's ("GM") Class A membership interests and PBGC's Class C membership interests (together, the "GM/PBGC Redemptions") by the successors to the "Company Buyer" which purchased the "Company Acquired Assets" of the Debtors under the Plan and the Master Disposition Agreement, dated as of July 30, 2009 (the "MDA"), are to be counted toward satisfying the foregoing condition, the right to the General Unsecured MDA Distribution under Plan Sections 1.102 and 5.3 is owed in the full amount of $300 million. The Defendants, who are the successors to the "Company Buyer," contend that the GM/PBGC Redemptions were not the kind of distributions to the Company Buyer's members contemplated by the definition of "General Unsecured MDA Distribution." Essentially, the Defendants contend that only distributions made by the Company Buyer to its members in specified percentages satisfy the condition to the general unsecured creditors' right to receive the General Unsecured MDA Distribution. Under this interpretation, because the GM/PBGC Redemptions were not made along with distributions to the Company Buyer's other members in the specified percentages, the triggering event has not occurred. Instead, they argue, the GM/PBGC Redemptions fall under a different provision of the operative documents referred to in the Plan's definition of the General Unsecured MDA Distribution. A full-text copy of the Memorandum of Decision dated May 13, 2016 is available at https://is.gd/Ljpx1w from Leagle.com. The bankruptcy case is In re: DPH Holdings Corp., et al., Reorganized, Chapter 11, Debtors, Case No. 05-44481 (RDD), (Jointly Administered)(Bankr. S.D.N.Y.). Solus Alternative Asset Management LP, Plaintiff, is represented by Susheel Kirpalani, Esq. -- susheelkirpalani@quinnemanuel.com -- Quinn Emanuel Urquhart & Sullivan LLP, James C. Tecce, Esq. -- jamestecce@quinnemanuel.com -- Quinn Emanuel Urquhart & Sullivan LLP. Delphi Automotive LLP, Defendant, is represented by Edward A. Friedman, Esq. -- efriedman@fklaw.com -- Friedman Kaplan Seiler & Adelman LLP, John Oster, Esq. -- joster@fklaw.com -- Friedman Kaplan Seiler & Adelman LLP. DEX MEDIA: Alvarez & Marsal's Andrew Hede to Serve as CRO --------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Alvarez & Marsal North America, LLC, to provide the Debtors with a Chief Restructuring Officer and certain additional A&M Personnel to assist the CRO. The Debtors seek to designate Andrew Hede as the Debtors' CRO, nunc pro tunc to the Petition Date. A&M will: a. perform a financial review of the Debtors, including, but not limited to, a review and assessment of financial information that has been, and that will be, provided by the Debtors to its creditors, including, without limitation, its short and long-term projected cash flows; b. assist with the identification and implementation of short-term cash management procedures; c. assist in the identification of cost reduction and operations improvement opportunities; d. develop possible restructuring plans or strategic alternatives for maximizing the enterprise value of the Debtors' business; e. serve as the principal contact with the Debtors' creditors with respect to the Debtors' financial and operational matters; and f. perform other services consistent with the role of CRO as requested or directed by the Debtors' board of directors. A&M will be paid these hourly rates: Managing Directors $750-$950 Directors $550-$750 Analysts/Associates $350-$550 Andrew Hede, Managing Director with A&M, assures the Court that the firm is not a creditor of the Debtors (including by reason of unpaid fees for prepetition services) or an equity security holder of the Debtors (except certain firm employees may own de minimis amounts representing not more than 0.01% of the equity interests in the related entity); and does not have any interest materially adverse to the interests of the Debtors' estates, or of any class of creditors or equity security holders, by reason of any direct or indirect relationship to, connection with, or interest in, the Debtors, or for any other reason. A&M will be retained to provide the Debtors with the engagement personnel as necessary, and Mr. Hede will be designated as the Debtors' CRO pursuant to section 363 of the Bankruptcy Code. Because A&M is not being employed as a professional under Section 327 of the Code, A&M will not be required to submit fee applications pursuant to sections 330 and 331 of the Bankruptcy Code. Instead, A&M will submit monthly invoices to the Debtors. In addition, A&M will file with the Court, with copies to the U.S Trustee and any statutory committee appointed in these Chapter 11 cases a report of staffing on the engagement for the previous month. The Staffing Report will include the names and tasks filled by all engagement personnel involved in this matter. The notice parties will have 14 days after the date each Staffing Report is served on the Notice Parties to object to Staffing Report. In the event an objection is properly filed and not consensually resolved between the Debtors and the objecting party, all staffing and compensation will be subject to review by the Court. As set forth in the engagement letter, A&M received $400,000 as a retainer. In the 90 days prior to the Petition Date, A&M received additional payments totaling approximately $2,487,401 in the aggregate for services performed for the Debtors. Certain expenses and fees may have been incurred by A&M prior to the Petition Date, but not yet applied to the Retainer. The amounts, if any, would be less than the aggregate balance of the Retainer as of the Petition Date. Moreover, the Debtors are not aware of any asserted or threatened disputes against A&M or the engagement personnel on account of their services provided before the Petition Date. Given the numerous issues which the engagement personnel may be required to address in the performance of their services, A&M's commitment to the variable level of time and effort necessary to address all issues as they arise, and the market prices for services in and out-of-court, the Debtors submit that the fee arrangements set forth in the motion and in the engagement letter are reasonable. A&M can be reached at: Andrew Hede Alvarez & Marsal North America, LLC 600 Madison Avenue, 8th Floor New York, NY 10022 Tel: (212) 759-4433 Fax: (212) 759-5532 E-mail: ahede@alvarezandmarsal.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DEX MEDIA: Hires Ernst & Young as Auditor & Tax Advisor ------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Ernst & Young LLP as their auditor and tax advisor, effective nunc pro tunc to the Petition Date. Objections on the request must be filed by June 6, 2016, at 4:00 p.m. (ET). A hearing on the request is slated for June 13, 2016, at 1:00 p.m. (ET). E&Y will provide these services: a. Audit Services (1) Audit and report on the consolidated financial statements of Dex Media, Inc., for the year ended Dec. 31, 2015; (2) Review the Company's unaudited interim financial information before the Company files its Form 10-Q. (3) In connection with EY LLP's audit of the consolidated financial statements, it also will report on the Company's compliance with the terms, covenants, provisions, or conditions of these agreements as of Dec. 31, 2015: (i) Article IV, inclusive, of the Indenture dated Jan. 29, 2010, as supplemented by the First Supplemental Indenture dated April 30, 2013, among Dex One Corporation, Dex Media, Inc. and Bank of New York Mellon; (ii) Section 6.14 of the Fourth Amended and Restated Credit Agreement dated April 30, 2013, among Dex Media, Inc., R.H. Donnelley Inc. and Deutsche Bank Trust Company Americas; (iii) Section 6.14 of the Amended and Restated Credit Agreement dated April 30, 2013, among Dex Media, Inc., Dex Media Holdings, Inc., Dex Media East, Inc. and JPMorgan Chase Bank, N.A.; (iv) Section 6.14 of the Amended and Restated Credit Agreement dated April 30, 2013, and First Amendment to Credit Agreement dated March 10, 2015, among Dex Media, Inc., Dex Media Holdings, Inc., Dex Media West, Inc., and JPMorgan Chase Bank, N.A.; (v) the consolidating financial statement information of Dex Media, Inc.; (4) Perform out of scope audit services and address out of scope technical accounting and tax matters relating to the financial statement audit and quarterly reviews; and (5) Address technical accounting matters related to the Debtors' reorganization, including fresh start accounting. b. Routine On-Call Tax Advice (1) EY LLP may provide routine tax advice and assistance concerning issues as requested by the Company when such projects are not covered by a separate statement of work and do not involve any significant tax planning or projects. The scope of these services may be agreed to orally or through written communications with the Debtors, like e-mails. EY LLP will charge the Debtors fees for each of the services: a. Audit Services (1) EY LLP's fees will be based on the time that EY LLP's professionals spend performing like services, as adjusted annually on July 1 while such Services are being performed. The current hourly rates, by level of professional, are: Partner/Executive Director $882 Senior Manager $736 Manager $653 Senior $454 Staff $284 (2) In addition to the foregoing, EY LLP's fees for out of scope technical accounting matters and out of scope technical tax matters related to the financial statement audit and quarterly reviews will be based on the time that EY LLP's professionals spend performing like services, as adjusted annually on July 1 while the services are being performed. The current hourly rates, by level of professional, are: Partner /Executive Director $882-$975 Senior Manager $736-$890 Manager $653-$733 Senior $454-$556 Staff $284-$301 (3) In addition to the foregoing, EY LLP's fees for (i) technical accounting matters, including the presentation of liabilities subject to compromise, reorganization expenses, and financial statement disclosures; (ii) accounting matters regarding fresh start accounting and (iii) work that is required by or in connection with the Bankruptcy Code and Bankruptcy Rules, like connections checking, employment application preparation and fee application services, will be based on the time that EY LLP's professionals spend performing the services, as adjusted annually on July 1 while the services are being performed. The current hourly rates, by level of professional, are: Partner/Executive Director $882 Senior Manager $736 Manager $653 Senior $454 Staff $284 b. Routine On-Call Tax Advice (1) EY LLP's fees for Routine On-Call Tax Advice Services will be based on the time that EY LLP's professionals spend performing them, as adjusted annually each July 1 while the services are being performed. The rates, by level of professional, are: Partner/Executive Director $975 Senior Manager $890 Manager $733 Senior $556 Staff $301 The Debtors intend that EY LLP's services will complement, and not duplicate, the services to be rendered by any other professional retained by the Debtors in these Chapter 11 cases. EY LLP will cooperate with reasonable, clear instructions of the Debtors in avoiding duplication of services. Justin Grace, Esq., a partner at E&Y, assures the Court that the firm (a) does not hold nor represent any interest materially adverse to the Debtors' estates in the matters for which EY LLP is proposed to be retained; and (b) is a disinterested person, as the term is defined in Section 101(14) of the Bankruptcy Code. EY LLP will apply for compensation for professional services rendered and reimbursement of expenses incurred in connection with the Debtors' Chapter 11 cases in compliance with Sections 330 and 331 of the Bankruptcy Code and applicable provisions of the Bankruptcy Rules, the Local Rules, the applicable guidelines established by the Office of the U.S. Trustee. All compensation payable to EY LLP pursuant to the engagement letters will be subject to review pursuant to the standards set forth in Section 328(a) of the Bankruptcy Code; provided, however, that notwithstanding anything to the contrary in the court order, the application, the engagement letters, the U.S. Trustee will be entitled to review applications for payment of estimated fee compensation by EY LLP under the standards set forth in Sections 330 and 331 of the Bankruptcy Code, and that, in the event the U.S. Trustee objects to any application for payment of estimated fee compensation, this Court retains the right to review the application pursuant to Section 330 of the Bankruptcy Code. The U.S. Trustee retains all rights to object to any rate increase on all grounds, including the reasonableness standard set forth in Section 330 of the Bankruptcy Code, and this Court retains the right to review any rate increase pursuant to Section 330 of the Bankruptcy Code. E&Y can be reached at: Justin Grace, Esq. Ernst & Young LLP 2323 Victory Avenue, Suite 2000 Dallas, TX 75219 Tel: (214) 969-8000 Fax: (214) 969-8587 Website: ey.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DEX MEDIA: Hires Kirkland & Ellis as Chapter 11 Counsel ------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Kirkland & Ellis LLP and Kirkland & Ellis International LLP as their attorneys effective nunc pro tunc to the Petition Date. Kirkland will provide these services: a. advising the Debtors with respect to their powers and duties as debtors in possession in the continued management and operation of their businesses and properties; b. advising and consulting on the conduct of these Chapter 11 cases, including all of the legal and administrative requirements of operating in Chapter 11; c. attending meetings and negotiating with representatives of creditors and other parties in interest; d. taking all necessary actions to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors, and representing the Debtors in negotiations concerning litigation in which the Debtors are involved, including objections to claims filed against the Debtors' estates; e. preparing pleadings in connection with these Chapter 11 cases, including motions, applications, answers, orders, reports, and papers necessary or otherwise beneficial to the administration of the Debtors' estates; f. representing the Debtors in connection with obtaining authority to continue using cash collateral and postpetition financing (if any); g. advising the Debtors in connection with any potential sale of assets; h. appearing before the Court and any appellate courts to represent the interests of the Debtors' estates; i. advising the Debtors regarding tax matters; j. taking any necessary action on behalf of the Debtors to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and k. performing all other necessary legal services for the Debtors in connection with the prosecution of these Chapter 11 cases, including: (i) analyzing the Debtors' leases and contracts and the assumption and assignment or rejection thereof; (ii) analyzing the validity of liens against the Debtors; and (iii) advising the Debtors on corporate and litigation matters. Marc Kieselstein, Esq., president of Marc Kieselstein P.C., a partner of the law firm of Kirkland, assures the Court that (a) Kirkland is a disinterested person within the meaning of section 101(14) of the Bankruptcy Code, as required by Section 327(a) of the Bankruptcy Code, and does not hold or represent an interest adverse to the Debtors' estates and (b) Kirkland has no connection to the Debtors, their creditors, or other parties in interest, except as may be disclosed in this Declaration. Kirkland will be paid at these hourly rates: Partners $875-$1,445 Of Counsel $480-$1,445 Associates $510-$945 Paraprofessionals $180-$400 The Debtors paid $1.10 million to Kirkland as a classic retainer and the Debtors subsequently made additional classic retainer payments to Kirkland totaling $13,421,610.24 in the aggregate. Moreover, pursuant to the engagement letter, the classic retainers are property of Kirkland and are not held in a separate account. Kirkland earned the classic retainers upon receipt, and, consequently, Kirkland placed the amounts into its general cash account. Kirkland will apply for compensation for professional services rendered and reimbursement of expenses incurred in connection with the Debtors' Chapter 11 cases in compliance with Sections 330 and 331 of the Bankruptcy Code and applicable provisions of the Bankruptcy Rules, Local Bankruptcy Rules, and any other applicable procedures and orders of the Court. Kirkland also intends to make a reasonable effort to comply with the U.S. Trustee's requests for information and additional disclosures as set forth in the Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed Under 11 U.S.C. Section 330 by Attorneys in Larger Chapter 11 Cases Effective As of Nov. 1, 2013, both in connection with the Application and the interim and final fee applications to be filed by Kirkland in these Chapter 11 cases. In response to the request for additional information set forth in Paragraph D.1. of the Revised UST Guidelines, Kirkland disclosed that: -- the firm and the Debtors have not agreed to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement. The rate structure provided by Kirkland is appropriate and is not significantly different from (a) the rates that Kirkland charges for other nonbankruptcy representations or (b) the rates of other comparably skilled professionals. -- The hourly rates used by Kirkland in representing the Debtors are consistent with the rates that Kirkland charges other comparable Chapter 11 clients, regardless of the location of the Chapter 11 case. -- Kirkland's hourly rates from Jan. 1, 2015 to Dec. 31, 2015 for services rendered on behalf of the Debtors are: Partners $795-$1,355 Of Counsel $480-$1,195 Associates $480-$890 Paraprofessionals $170-$380 Kirkland's current hourly rates for services rendered on behalf of the Debtors as of Jan. 1, 2016, are: Partners $875-$1,445 Of Counsel $480-$1,445 Associates $510-$945 Paraprofessionals $180-$400 These ranges took effect Jan. 1, 2016. These ranges have been finalized and are currently in effect, subject to periodic adjustments to reflect economic and other conditions. Kirkland represented the Debtors during the 12-month period before the Petition Date, using the hourly rates listed. During the 12-month period before the Petition Date, Kirkland provided certain limited litigation services at a reduced rate, subject to an insurance policy under which the Debtors' insurer was obligated to pay the relevant fees and expenses. These reduced rates were provided as an accommodation to the insurer. During this same time period, however, Kirkland has billed for all other services at its standard hourly rates. -- The Debtors have approved Kirkland's budget and staffing plan for the period from the Petition Date through 120 days after the Petition Date. Kirkland can be reached at: Richard W. Porter, P.C. Kirkland & Ellis LLP 300 North LaSalle Chicago, IL 60654 Tel: (312) 862-2334 Fax: (312) 862-2200 E-mail: richard.porter@kirkland.com Website: www.kirkland.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DEX MEDIA: Hires Moelis & Co. as Investment Banker, Fin'l Advisor ----------------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Moelis & Company LLC as investment banker and financial advisor. A hearing on the request is set for June 13, 2016, at 1:00 p.m. (ET). An objection to the request must be filed by June 6, 2016, at 4:00 p.m. (ET). Moelis will: a. assist the Debtors in reviewing and analyzing the Debtors' results of operations, financial condition, and business plan; b. assist the Debtors in reviewing and analyzing a potential restructuring, amend and extend transaction, or capital transaction (or any combination thereof) and developing a strategy to effectuate the sale transaction; c. assist the Debtors in negotiating a potential restructuring, amend and extend transaction, or capital transaction (or any combination); d. advise the Debtors as to the timing, structure, and pricing of a potential capital transaction; e. advise the Debtors on its preparation of information memorandum for a potential capital transaction; f. assist the Debtors in identifying and contacting prospective purchasers in respect of a capital transaction, and providing, on behalf of the Debtors, the prospective purchasers with the information memo and information about the Debtors as may be appropriate and acceptable to the Debtors, subject to customary business confidentiality; g. advise the Debtors as to the strategy and tactics of negotiations with the prospective purchasers and participate in the negotiations; h. if requested by the Debtors, participate in hearings before the court having jurisdiction over any bankruptcy cases commenced under the Bankruptcy Code to implement a restructuring or sale transaction and provide testimony on matters mutually agreed to by the Debtors and Moelis, subject to the Debtors obtaining a court order approving the retention of Moelis to act as financial advisor to the Debtors in the bankruptcy cases in substance reasonably acceptable to Moelis; i. if requested by the Debtors, prepare a going concern valuation analysis of the Debtors for submission to the Court in a bankruptcy case and for inclusion in any disclosure statement used by the Debtors in connection with a bankruptcy case and assist the Debtors in the Debtors' preparation of a liquidation analysis of the Debtors for submission to the Court in a bankruptcy case and for inclusion in any disclosure statement used by the Company in connection with a bankruptcy case; j. assist the Debtors in negotiating amendments to their and their subsidiaries' credit agreements with their respective lenders; k. assist the Debtors, in obtaining the consent (if necessary) of its lenders and bondholders for the restructuring, amend and extend transaction, or capital transaction (or any combination thereof) or sale transaction; provided, if Moelis is requested to solicit bondholder consents for a restructuring, amend and extend transaction, or capital transaction (or any combination), or sale transaction to be effected out of court, the solicitation will be pursuant to a customary solicitation agent agreement to be mutually agreed upon by the Debtors and Moelis; and l. at the Debtors' request, meet with the Debtors' Board of Directors, from time to time, to discuss the proposed restructuring, amend and extend transaction, or capital transaction (or any combination thereof) or sale transaction and its financial implications. Moelis will be paid these fees: a. Monthly Fee: a fee of $200,000 per month, payable for each month commencing as of May 1, 2015; b. Restructuring Fee: at the closing of a restructuring, a fee of $8.50 million; c. Amend and Extend Fee: at the closing of an amend and extend transaction, a fee of $7,50 million; d. Capital Transaction Fee: at the closing of any capital transaction, a non-refundable cash fee of: (i) 1% of the aggregate gross amount of secured debt obligations raised in the capital transaction; and (ii) fees, to be mutually agreed upon between Moelis and the Debtors, consistent with fees paid to global investment banks for similar transactions on the aggregate gross amount of unsecured debt and equity raised in the capital transaction. 50% of the capital transaction fee will be offset, to the extent previously paid (or paid contemporaneously), against any Restructuring Fee or amend and extend fee. e. Retainer Fee: a retainer fee of $250,000, paid upon execution of the sales transaction engagement letter. The retainer will be offset, to the extent previously paid, against the sale transaction fee. f. Opinion Fee: an opinion fee equal to $2.50 million payable promptly upon delivery by Moelis of an opinion to the Board of Directors of the Debtors, regardless of the conclusion reached in the opinion. g. Sale Transaction Fee: a transaction fee, payable promptly at the closing of a Sale Transaction of (i) $11.50 million if a Sale Transaction is effected through a Chapter 11 plan, or (ii) otherwise, $13.50 million. h. Termination Fee: a termination fee equal to the lesser of $1 million or 25% of any "termination fee," "break-up fee," or other similar form of compensation payable to the Debtors if, after the execution of an agreement for a Sale Transaction, the Sale Transaction fails to close and the Debtors receive any such compensation. The Debtors will pay the Termination Fee when the Debtors receive any compensation. More information on the fees is available for free at: http://bankrupt.com/misc/DEXMEDIA_98_moelis.pdf The Debtors believe that the services provided by Moelis will not duplicate the services that other professionals will be providing to the Debtors in these Chapter 11 cases. Specifically, Moelis will carry out unique functions and will use reasonable efforts to coordinate with the Debtors and their professionals retained in these Chapter 11 cases to avoid the unnecessary duplication of services. Moelis intends to apply for compensation for professional services rendered and reimbursement of expenses incurred in connection with these Chapter 11 cases, subject to the Court's approval and in compliance with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the U.S. Trustee Guidelines, and any other applicable procedures and orders of the Court, with certain limited modifications. The Debtors request that the requirements of Local Rule 2016-2(d) and the U.S. Trustee Guidelines be tailored to appropriately reflect Moelis' engagement and its compensation structure. Moelis has requested, pursuant to Section 328(a) of the Bankruptcy Code, payment of its fees on a fixed-rate and fixed-percentage basis. Additionally, it is not the general practice of investment banking firms to keep detailed time records similar to those customarily kept by attorneys. However, Moelis' restructuring personnel will keep summary time records in hourly increments describing their daily activities and the identity of persons who performed the tasks. Apart from the time recording practices, however, Moelis' restructuring personnel do not maintain their time records on a "project category" basis. The Debtors request modification of the requirements pursuant to Local Rule 2016-2(h). Zul Jamal, managing director of Moelis, assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code and does not hold or represent an interest adverse to the Debtors or their estates. Moelis can be reached at: Zul Jamal Moelis & Company LLC 399 Park Avenue, 5th Floor New York, New York 10022 Tel: (212) 883-3813 E-mail: zul.jamal@moelis.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DEX MEDIA: Hires Young Conaway as Bankruptcy Co-Counsel ------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Young Conaway Stargatt & Taylor, LLP, as bankruptcy co-counsel for the Debtors, nunc pro tunc to the Petition Date. Objections must be filed by June 6, 2016, at 4:00 p.m. (ET). A hearing on the request is set for June 13, 2016, at 1:00 p.m. (ET). Young Conaway will provide these services: -- providing legal advice with respect to the Debtors' powers and duties as debtors in possession in the continued operation of their businesses, management of their properties, and the potential sale of their assets; -- preparing and pursuing confirmation of a plan and approval of a disclosure statement; -- preparing, on behalf of the Debtors, necessary applications, motions, answers, orders, reports, and other legal papers; -- appearing in Court and protecting the interests of the Debtors before the Court; and -- performing all other legal services for the Debtors that may be necessary and proper in these proceedings, including acting as conflicts counsel if and when required and necessary. Young Conaway will be paid at these hourly rates: Pauline K. Morgan $795 Patrick A. Jackson $455 Ashley E. Jacobs $335 Norah M. Roth-Moore $290 Brenda Walters (paralegal) $255 Beth Olivere (paralegal) $175 Young Conaway was retained by the Debtors pursuant to the engagement agreement. Young Conaway received a retainer in the amount of $58,021.80 in connection with the planning and preparation of initial documents and its proposed postpetition representation of the Debtors. On May 10, 2016, Young Conaway received $22,321 for filing fees related to the filing of these Chapter 11 cases. In addition, in the year prior to the Petition Date, the Firm received certain payments from the Debtors for services performed prior to the Petition Date, as more fully set forth in Young Conaway's statement pursuant to Bankruptcy Rule 2016. A portion of the Retainer will be applied to any outstanding balances existing as of the Petition Date. The remainder will constitute a general retainer as security for postpetition services and expenses. Pauline K. Morgan, Esq., a partner at Young Conaway, assures the Court that Young Conaway is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code in that Young Conaway, its partners, counsel, and associates. Consistent with the U.S. Trustee's Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed Under 11 U.S.C. Section 330 by Attorneys in Larger Chapter 11 Cases, which became effective on Nov. 1, 2013, Mr. Morgan says that: a. Young Conaway has not agreed to a variation of its standard or customary billing arrangements for this engagement; b. None of the firm's professionals included in this engagement have varied their rate based on the geographic location of these Chapter 11 cases; c. Young Conaway was retained by the Debtors pursuant to an engagement agreement dated Sept. 23, 2015. The billing rates and material terms of the prepetition engagement are the same as the rates and terms; and d. The Debtors have approved or will be approving a prospective budget and staffing plan for Young Conaway's engagement for the postpetition period as appropriate. In accordance with the U.S. Trustee Guidelines, the budget may be amended as necessary to reflect changed or unanticipated developments. Young Conaway can be reached at: Pauline K. Morgan Young Conaway Stargatt & Taylor, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Tel: (302) 571-6707 Fax: (302) 576-3318 E-mail: pmorgan@ycst.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. The Debtors listed $1.26 billion in total assets as of Dec. 31, 2015, and $2.65 billion in total debts as of Dec. 31, 2015. DEX MEDIA: Taps Epiq Bankruptcy as Administrative Advisor --------------------------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ Epiq Bankruptcy Solutions, LLC, as administrative advisor for the Debtors in connection with these Chapter 11 cases and for related relief, effective nunc pro tunc to May 16, 2016. Objections to the request must be filed by June 6, 2016, at 4:00 p.m. (ET). A hearing on the request is set for June 13, 2016, at 1:00 p.m. (ET). Epiq will provide these services: a. assisting with, among other things, solicitation, balloting, tabulation, and calculation of votes, as well as preparing any appropriate reports, as required in furtherance of confirmation of plan(s) of reorganization; b. generating an official ballot certification and testifying, if necessary, in support of the ballot tabulation results; c. generating, providing, and assisting with claims objections, exhibits, claims reconciliation, and related matters; d. providing assistance with preparation of the Debtors' schedules of assets and liabilities and statements of financial affairs; e. providing a confidential data room; f. managing any distributions pursuant to a confirmed plan of reorganization; and g. providing other claims processing, noticing, solicitation, balloting, and administrative services described in the services agreement, but not included in the Section 156(c) application, as may be requested from time to time by the Debtors. Epiq will be paid at these hourly rates: Clerical/Administrative Support $30-$45 Case Manager $60-$95 IT/Programming $70-$135 Sr. Case Manager/Dir. of Case Management $85-$155 Consultant/ Senior Consultant $150-$185 Director/Vice President Consulting $195 Executive Vice President - Solicitation $250 Executive Vice President – Consulting WAIVED Sr. Vice President Communications $350 Communications Counselors $95-$350 Kate Mailloux, Senior Director of Consulting of Epiq, assures the Court that the firm is a "disinterested person," as that term is defined in Section 101(14) of the Bankruptcy Code. Epiq represents, among other things, that: a. it will not consider itself employed by the U.S. government and will not seek any compensation from the U.S. government in its capacity as the Administrative Advisor; b. by accepting employment in these cases, Epiq waives any right to receive compensation from the U.S. government; c. in its capacity as the Administrative Advisor, Epiq will not be an agent of the U.S. and will not act on behalf of the U.S.; and d. Epiq will not employ any past or present employees of the Debtors in connection with its work as the Administrative Advisor. Prior to the Petition Date, the Debtors provided Epiq a retainer in the amount of $25,000. Epiq seeks to first apply the retainer to all pre-petition invoices, which retainer will be replenished to the original retainer amount, and thereafter, Epiq may hold the retainer under the services agreement during these Chapter 11 cases as security for the payment of fees and expenses incurred under the services agreement. Epiq can be reached at: Pamela Corrie Epiq Bankruptcy Solutions, LLC 777 Third Avenue, Third Floor New York, NY 10017 E-mail: pcorrie@epiqsystems.com DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DEX MEDIA: Taps KPMG LLP as Tax Advisors ---------------------------------------- Dex Media, Inc., et al., seek permission form the U.S. Bankruptcy Court for the District of Delaware to employ KPMG LLP as tax advisors, nunc pro tunc to the Petition Date, to provide audit assistance to the Debtors pursuant to those certain engagement letters, dated April 21, 2009, March 25, 2013, and Feb. 19, 2014, respectively. Objections must be filed by June 6, 2016, at 4:00 p.m. (ET). A hearing on the request is set for June 13, 2016, at 1:00 p.m. (ET). KPMG will provide these services: a. Tax Advisory Services i. merger-related consulting and analysis; ii. bankruptcy-related consulting and analysis; iii. tracking of "owner shift" percentages within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended; iv. attribute reduction calculations within the meaning of Section 108; v. cash tax modeling; vi. income tax provision assistance; and vii. state tax matters. b. Audit Assistance Professional services provided by audit personnel for financial statement impact related to the tax basis balance sheet analysis for fiscal years 2010 through 2012. KPMG will be paid at these hourly rates: Tax Advisory Discounted Discounted Discounted Services Rate – Rate – Rate - Federal Tax State & M&A Tax Local Tax ------------ ----------- ---------- ---------- Partners $513 $513 $525 Senior Managers $413 $450 $500 Managers $338 $325 $388 Senior Associates $238 $263 $325 Associates $175 $173 $200 Audit Assistance Discounted Rate ---------------- --------------- Partners $625 Managers $575 The Debtors intend that KPMG's services will complement, and not duplicate, the services to be rendered by any other professional retained by the Debtors in these Chapter 11 cases. KPMG will cooperate with reasonably clear instructions of the Debtors in avoiding duplication of services. Howard B. Steinberg, a partner of KPMG, assures the Court that the firm neither holds nor represents an interest adverse to the Debtors' estates that would impair KPMG's ability to objectively perform professional services for the Debtors, in accordance with Section 327 of the Bankruptcy Code. KPMG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy Code. The Debtors understand that it is not the general practice of tax and audit firms to keep detailed time records similar to those customarily kept by attorneys retained on behalf of the Chapter 11 debtors. Accordingly, the Debtors respectfully request that KPMG not be required to file time records in accordance with Bankruptcy Rule 2016(a), Local Rule 2016-2, the U.S. Trustee Fee Guidelines, and any other applicable orders or procedures of the Court. KPMG will maintain records (in summary format) of its services rendered for the Debtors in one-half hour increments, including reasonably detailed descriptions of those services and the individuals who provided those services, and will present the records to the Court in its interim and final fee applications. KPMG's fee and expense structure is comparable to compensation generally charged by other firms of similar stature to KPMG for comparable engagements, both in and out of bankruptcy. The Debtors believe that the foregoing compensation arrangements are reasonable, market-based, and consistent with KPMG's normal and customary billing practices for comparably-sized complex cases, both in- and out-of-court, that involve the services to be provided in these Chapter 11 cases. In light of the foregoing and given the numerous issues that KPMG may be required to address in the performance of its services, KPMG's commitment to the variable level of time and effort necessary to address the issues as they arise, and the market prices for KPMG's services for engagements of this nature, the Debtors believe that the Fee Structure is fair, reasonable, and market-based under the standard set forth in Section 328(a) of the Bankruptcy Code. KPMG can be reached at: Howard B. Steinberg KPMG LLP 1350 Avenue of the Americas New York, NY 10019 DFW Airport, Texas-based Dex Media, Inc. -- aka Newdex, Inc., Dex One Corporation, R.H. Donnelley Corporation -- provides marketing solutions to more than 400,000 business clients across the U.S. Dex Media filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 16-11200) on May 16, 2016. Affiliates Dex Media East, Inc. (Bankr. D. Del. Case No. 16-11201), Dex Media Holdings, Inc. (Bankr. D. Del. Case No. 16-11202), Dex Media Service LLC (Bankr. D. Del. Case No. 16-11203), Dex Media West, Inc. (Bankr. D. Del. Case No. 16-11204), Dex One Digital, Inc. (Bankr. D. Del. Case No. 16-11205), Dex One Service, Inc. (Bankr. D. Del. Case No. 16-11206), R.H. Donnelley APIL, Inc. (Bankr. D. Del. Case No. 16-11207), R.H. Donnelley Corporation (Bankr. D. Del. Case No. 16-11208), R.H. Donnelley Inc. (Bankr. D. Del. Case No. 16-11209), SuperMedia Inc. (Bankr. D. Del. Case No. 16-11210), SuperMedia LLC (Bankr. D. Del. Case No. 16-11211), and SuperMedia Sales Inc. (Bankr. D. Del. Case No. 16-11212) filed for Chapter 11 bankruptcy protection on the same day. The petitions were signed by Andrew Hede, chief restructuring officer. James H.M. Sprayregen, P.C, Marc Kieselstein, P.C., Adam Paul, Esq., and Bradley Thomas Giordano, Esq., at Kirkland & Ellis LLP and Kirkland & Ellis International LLP serve as the Debtors' general bankruptcy counsel. Patrick A. Jackson, Esq., and Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor, LLP, serve as the Debtors' co-counsel. Moelis & Company LLC is the Debtors' investment banker. KPMG LLP is the Debtors' tax advisor. Ernst & Young LLP is the Debtor's auditor. Epiq Bankruptcy Solutions is the Debtors' notice, claims & administrative agent. DIFFERENTIAL BRANDS: Joins B. Riley & Co.'s Conference ------------------------------------------------------ Differential Brands Group Inc. participated in B. Riley & Co.'s 17th Annual Investor Conference in Hollywood, California, on May 25, 2016. The Company's presentation for the conference is available for free at https://is.gd/BkvljB About Differential Brands Differential Brands Group Inc., formerly Joe's Jeans Inc., is a platform that focuses on branded operating companies in the premium space. The Company's focus is on organically growing its brands through a global, omni-channel distribution strategy while continuing to seek opportunity to acquire accretive, complementary, premium brands. The Company's current brands are Hudson, a designer and marketer of women's and men's premium branded denim apparel, and Robert Graham, a sophisticated, eclectic style to the fashion market as an American-based company with an intention of inspiring a global movement. Joe's Jeans Inc. has completed the merger combining Hudson Jeans and Robert Graham. Additionally, the company has been renamed Differential Brands Group Inc. and will remain publicly listed on NASDAQ under the ticker DFBG. Differential Brands reported a net loss and comprehensive loss of $32.3 million on $80.2 million of net sales for the year ended Nov. 30, 2015, compared to a net loss and comprehensive loss of $27.7 million on $84.2 million of net sales for the year ended Nov. 30, 2014. As of March 31, 2016, Differential Brands had $168 million in total assets, $115 million in total liabilities and $52.7 million in total equity. DRAFTDAY FANTASY: Fails to Regain Compliance of NASDAQ Rule ----------------------------------------------------------- DraftDay Fantasy Sports Inc. received on Nov. 20, 2015, written notice from the Listing Qualifications Department of The NASDAQ Stock Market LLC indicating that the Company did not maintain a minimum closing bid price of $1.00 per share, as required by Nasdaq Listing Rule 5550(a)(2), for the preceding 30 business days. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company was provided with a cure period of 180 calendar days, or until May 18, 2016, to regain compliance with the Rule. The Company did not timely regain compliance and, on May 19, 2016, received written notice from the Staff indicating that the Company's non-compliance with the Rule could serve as an additional basis for delisting of the Company's securities from Nasdaq. As previously disclosed, the Company attended a hearing before the Nasdaq Listing Qualifications Panel, subsequent to which the Panel granted the Company an extension through Aug. 22, 2016, to evidence compliance with the $2.5 million stockholders' equity requirement and all other applicable requirements for continued listing on The Nasdaq Capital Market. In connection therewith, the Company intends to implement a reverse split of its common stock to remedy the bid price deficiency and has already provided the Panel with its plan to evidence compliance with the Rule. About DraftDay DraftDay Fantasy Sports Inc., formerly known as Viggle Inc., offers a high quality daily fantasy sports experience directly to consumers and to businesses desiring turnkey solutions to new revenue streams. DraftDay Fantasy Sports Inc. is the largest shareholder of DraftDay Gaming Group, with a 44% stake. Sportech owns 35%. By combining and capitalizing on the well-established operational business assets of DraftDay and Sportech, the new DraftDay is well-positioned to become a significant player in the explosive fantasy sports market. DraftDay has paid out over $30 million in prizes with increased player retention and brand loyalty. DraftDay Fantasy Sports also operates MyGuy and Viggle Football both of which offer real-time interactive participation with professional and college football games; Wetpaint, which offers entertainment and celebrity news; and Choose Digital, a digital marketplace platform that allows companies to incorporate digital content into existing rewards and loyalty programs in support of marketing and sales initiatives. "The Company is unlikely to generate significant revenue or earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its stockholders, the ability of the Company to obtain necessary equity or debt financing to continue development of its business and to generate revenue. Management intends to raise additional funds through equity and/or debt offerings until sustainable revenues are developed. There is no assurance such equity and/or debt offerings will be successful and therefore there is substantial doubt about the Company's ability to continue as a going concern within one year after the financial statements are issued," according to the Company's quarterly report for the period ended Dec. 31, 2015. As of March 31, 2016, DraftDay had $32.4 million in total assets, $48.6 million in total liabilities, $12.5 million in series C convertible redeemable preferred stock and a $28.6 million total stockholders' deficit. DYCOM INDUSTRIES: S&P Affirms 'BB-' Rating on $485MM Sr. Notes -------------------------------------------------------------- S&P Global Ratings affirmed its 'BB-' issue-level rating on Palm Beach Gardens, Fla.-based Dycom Industries Inc.'s $485 million senior unsecured convertible notes due 2021. The '5' recovery rating on the notes remains unchanged, indicating S&P's expectation for modest (10%-30%; lower half of the range) recovery in the event of a default. All of S&P's other ratings on Dycom remain unchanged. Dycom has upsized its existing term loan due 2020 (not rated) by $200 million to $350 million. The company used the proceeds from this increase to pay down the existing borrowings under its $450 million revolver due 2020 (not rated). S&P believes that the recovery prospects for the senior unsecured convertible noteholders have decreased following the upsizing of the term loan, which--in S&P's view--would have priority over the notes in a default. However, the recovery rating remains '5'. RECOVERY ANALYSIS Key analytical factors: -- Given Dycom's position as a specialty engineering and construction contractor competing in the cyclical telecommunications end market, S&P's distressed scenario envisions a period of delays and outright cancelations of cable- and telecom-related capital spending programs with Dycom's key customers reducing their capital expenditure budgets in line with the broader industry. -- S&P's analysis further assumes that the revolver is 85% drawn at default; the margin on the revolver and term loan increases by 125 basis points (bps), reflecting higher borrowing costs from credit deterioration simulated in S&P's scenario; and Dycom's EBITDA declines by approximately 60% from S&P's expected fiscal-year 2016 levels at default. -- S&P has valued the company on a going concern basis using a 5x multiple of its projected emergence EBITDA. Simulated default and valuation assumptions: -- Simulated year of default: 2021 -- EBITDA at emergence: $140 million -- EBITDA multiple: 5x Simplified waterfall: -- Net enterprise value (after 5% admin. costs): $665 million -- Senior secured claims: $606 million -- Total value available to subordinated debt: $59 million -- Senior subordinated claims: $490 million -- Recovery expectations: 10%-30% (lower half of the range) Note: All debt amounts include six months of prepetition interest. RATINGS LIST Dycom Industries Inc. Corporate Credit Rating BB/Stable/-- Ratings Affirmed; Recovery Band Revised To From Dycom Industries Inc. Senior Unsecured BB- BB- Recovery Rating 5L 5H EMERALD OIL: Snags $73-Mil. Bid Before July Auction --------------------------------------------------- Lillian Rizzo, writing for Daily Bankruptcy Review, reported that Emerald Oil Inc. snagged a $73 million bid from affiliates of institutional investor Crestline Management LP and private-equity firm Sole Source Capital LLC, setting the floor ahead of a July auction. According to the report, court papers show the company is asking Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., to sign off on the stalking horse, or lead, bidder so it can move forward with its sale timeline. If that timeline is approved, other bids for Emerald would be due by July 6, the report related. If needed, an auction would be held July 11, the report said. A hearing to approve the sale would take place on July 14, the report further related. Emerald said in court papers that the sale of all of its oil and gas assets, including leases and mineral contracts mainly in North Dakota, will reap the best recovery for the company's creditors, the report added. About Emerald Oil Emerald is a Denver-based independent exploration and production company that is focused on acquiring acreage and developing wells in the Williston Basin of North Dakota. Emerald Oil, Inc., Emerald DB, LLC, Emerald NWB, LLC, Emerald WB LLC and EOX Marketing, LLC filed separate Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10704 to 16-10708) on March 22, 2016. Ryan Smith signed the petitions as chief financial officer. The Debtors have hired Kirkland & Ellis LLP and Kirkland & Ellis International LLP as general bankruptcy counsel, Pachulski Stang Ziehl & Jones LLP as local counsel, Intrepid Financial Partners, LLC as investment banker, Opportune LLP as restructuring advisor and Donlin Recano & Company, Inc., as claims and noticing agent. Judge Kevin Gross has been assigned the cases. Andrew Vara, acting U.S. trustee for Region 3, appointed seven creditors of Emerald Oil, Inc., to serve on the official committee of unsecured creditors. ENERGY TRANSFER: S&P Puts 'BB' CCR on CreditWatch Negative ---------------------------------------------------------- S&P Global Ratings placed its 'BB' corporate credit rating and other ratings on U.S. midstream energy master limited partnership (MLP) Energy Transfer Equity L.P. (ETE) on CreditWatch with negative implications. The '4' recovery rating on the senior secured debt is unchanged and indicates expectations of average recovery (30%-50%; higher end of the range) if a default occurs. "The rating action reflects our expectation that ETE's stand-alone financial leverage pro forma for its merger with The Williams Cos. Inc. will be considerably weaker than our previous expectations," said S&P Global Ratings credit analyst Michael Grande. S&P revised its assessment of ETE's pro forma stand-alone debt leverage to negative from neutral based on S&P's expectation that ETE's debt to EBITDA (defined as distributions from its subsidiaries minus general and administrative expenses) will be almost 7x annualized (8x on a trailing 12-month basis) in 2016 from S&P's previous expectations of between 3.5x to 4x in 2016. The deal faces both industry and legal headwinds, with weaker commodity prices and lower expected commercial synergies that have decreased from about $2 billion to $126 million as key drivers of the revised credit measures. S&P's projections still assume ETE funds up to $6 billion of the transaction's cash consideration almost entirely with debt plus some excess cash flow. S&P's forecast also assumes that distributions to ETE are lower, mainly due to incentive distribution right (IDR) subsidies that benefit the underlying MLPs' distribution coverage ratios and credit profiles. That said, S&P expects ETE uses a significant portion excess cash flow after distributions to repay debt in 2017 and 2018, leading to debt to EBITDA of about 5.9x and 3.8x, respectively. S&P expects to resolve the CreditWatch listing upon close of the merger with Williams, at which time S&P expects to lower its rating on ETE by two notches to 'B+'. FANNIE MAE: William Forrester Resigns as Director ------------------------------------------------- William Thomas Forrester notified Fannie Mae (formally, Federal National Mortgage Association) of his resignation from the Board of Directors of the Company, effective as of May 31, 2016, as disclosed in a regulatory filing with the Securities and Exchange Commission. About Fannie Mae Federal National Mortgage Association, aka Fannie Mae, is a government-sponsored enterprise that was chartered by U.S. Congress in 1938 to support liquidity, stability and affordability in the secondary mortgage market, where existing mortgage-related assets are purchased and sold. The U.S. Department of the Treasury owns Fannie Mae's senior preferred stock and a warrant to purchase 79.9 percent of its common stock, and Treasury has made a commitment under a senior preferred stock purchase agreement to provide Fannie with funds under specified conditions to maintain a positive net worth. Fannie Mae reported net income of $10.95 billion on $109 billion of total interest income for the year ended Dec. 31, 2015, compared with net income of $14.2 billion on $114 billion of total interest income for the year ended Dec. 31, 2014. As of March 31, 2016, Fannie Mae had $3.22 trillion in total assets, $3.21 trillion in total liabilities and $2.11 billion in total equity. About Freddie Mac Based in McLean, Virginia, the Federal Home Loan Mortgage Corporation, known as Freddie Mac (OTCBB: FMCC) -- http://www.FreddieMac.com/-- was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters. Freddie Mac is under conservatorship and is dependent upon the continued support of Treasury and the Federal Housing Finance Agency acting as conservator to continue operating its business. FLOUR CITY BAGELS: Wants 90-Day Extension of Plan Filing Period --------------------------------------------------------------- Flour City Bagels, LLC, asks the U.S. Bankruptcy Court for the Western District of New York to extend the Debtor's periods during which the Debtor has the exclusive right to file a Chapter 11 plan and to solicit acceptance of that plan by 90 days from June 30, 2016, and Aug. 29, 2016, respectively. A hearing on the request is set for June 9, 2016, at 9:00 a.m. (prevailing Eastern time). The period during which the Debtor has the exclusive right to file a plan of reorganization, and the period during which the Debtor has the exclusive right to obtain acceptance of a plan, are scheduled to expire on June 30 and Aug. 29, respectively. Thus, the Debtor submits that the Exclusivity Periods should be enlarged (i) to allow the Debtor to focus its time and resources on the sale process and (ii), if a sale of the Debtor's assets is not consummated, to provide sufficient time for the Debtor to evaluate the content for, to negotiate with creditors regarding, and otherwise to formulate an alternative Chapter 11 plan. Since the Petition Date, the Debtor and its professionals have been preparing to market and sell the Debtor's assets as a going concern. Toward that end, on May 20, 2016, the Court entered an Order approving certain bidding procedures with respect to a sale of the Debtor's assets to the highest or best bidder. Assuming the sale process proceeds as the Debtor intends, the Debtor will hold an Auction for its assets on June 8, 2016, and the Court will conduct a hearing on the sale to the successful bidder at the Auction on June 30, 2016. The Debtor says that this case is relatively large and complex for this district and for purposes of section 1121(d). The Debtor has 32 stores and numerous related non-residential real estate leases, a correspondingly large number of landlords, hundreds of employees, unresolved issues with its franchisor, annual gross revenues of approximately $23 million, at least 163 unsecured creditors, (including holders of Section 503(b)(9) administrative-priority claims), secured debt of approximately $11.50 million, tax obligations to the State of New York totaling almost $1 million, and general unsecured debt of approximately $2.50 million. Given this number and variety of constituencies (each with its own particular concerns and desired outcomes), if a sale of the Debtor's assets does not close, the Debtor will require additional time during which to negotiate with and develop treatment for these creditors' claims. The Debtor also is filing a motion to extend the period within which to assume, assume and assign, or reject the Debtor's unexpired leases of non-residential real property -- also to permit additional time to complete a sale or, if need be, to negotiate with the landlords regarding their treatment in a Chapter 11 plan. About Flour City Bagels Headquartered in Fairport, New York, Flour City Bagels, LLC, operates 32 bakeries that serve "New York Style" bagels, coffee, drinks, soups, salads, sandwiches, fresh fruit, and a variety of other related items. In 1993, the Debtor opened its commissary in Rochester, at which it produces bagels for sale at all of its 32 bakeries. The Debtor employs 425 people. Flour City Bagels, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.Y. Case No. 16-20213) on March 2, 2016, estimating both assets and debts in the range of $10 million to $50 million. Kevin Coyne, the manager, signed the petition. Judge Paul R. Warren is assigned the case. Bond, Schoeneck & King, PLLC, and Buckley King serve as the Debtor's counsel. FRED FULLER: Committee Seeks to Sue Owner, Executives ----------------------------------------------------- The Official Committee of Unsecured Creditors in Fred Fuller Oil & Propane Co., Inc.'s bankruptcy case asks the U.S. Bankruptcy Court for the District of New Hampshire to grant it standing to file and prosecute complaints, claims objections, and other motions against: (1) Frederick J. Fuller, the sole equity interest holder and director and the President of the Debtor; (2) Robert Scott Beltran; (3) Becky Beltran; (4) Alison Carter; (5) Laurie Reed; (6) William Fuller and Rebecca Fuller; (7) Sharen J. Fuller, the former spouse of Frederick Fuller; and (8) Dawn Coppola, with whom Frederick J. Fuller has a close, personal relationship. In the event the Court does not grant the Official Committee standing to prosecute complaints, claims objections, and other motions against the Potential Defendants, the Official Committee requests that the Court confirms the authority of the Debtor's Chief Restructuring Officer Jeffrey T. Varsalone to authorize, file or prosecute complaints, claims objections and other motions against the Potential Defendants. "The Causes of Action held by the Debtor and the estate have value and must be filed and prosecuted for the benefit of the estate. Among other things, the collection of the Causes of Action will fund the payment of dividends to innocent creditors that provided the Debtor with goods and services," the Official Committee contends. The Committee's motion is scheduled for hearing on June 21, 2016, at 9:00 a.m. The Official Committee of Unsecured Creditors is represented by: Daren R. Brinkman, Esq. BRINKMAN PORTILLO RONK, APC Ptarmigan at Cherry Creek 3773 Cherry Creek North Drive, Suite 575 Denver, CO 80209 Telephone: (720)360-0822 Facsimile: (800)381-2192 E-mail: dbrinkman@brinkmanlaw.com Fred Fuller Oil & Propane Hudson, New Hampshire-based Fred Fuller Oil & Propane Co., Inc., was the largest heating oil company in the state, serving about 30,000 New Hampshire customers. It sought Chapter 11 protection (Bankr. D. N.H. Case No. 14-12188) in Manchester, New Hampshire, on Nov. 10, 2014. Fredrick J. Fuller, the president, signed the bankruptcy petition. The Debtor estimated $10 million to $50 million in assets and debt. The Nov. 10, 2014 court filing shows that the Debtor has about $13.5 million in debt. William S. Gannon, Esq., at William S. Gannon PLLC, in Manchester, serves as counsel to the Debtor. On Feb. 12, 2015, the Office of the U.S. Trustee appointed a three-member Official Committee of Unsecured Creditors. The Committee selected Brinkman Portillo Ronk, APC, as its counsel with Deming Law Office acting "of counsel." * * * The Court on Nov. 26, 2014, entered an order authorizing the Debtor to sell substantially all assets to Rymes Heating Oil, Inc. The Order called for Rymes to assume the liability and responsibility for performing the Debtor's liabilities under the "Pre-Buy/Budget Contracts," and to deliver fuel to their homes without further cost. Under the purchase and sales agreement as approved by the Court, Rymes assumed the liabilities for employee vacation and sick pay; delivered a promissory note for $3.645 million to Sprague; and delivered a promissory note to the estate in the amount of$275,000. Rymes also agreed to pay Raymond Green up to $2.5 million. Also sold through the sale process were assets belonging to Mr. Frederick Fuller, or non-debtor entities he controlled. Disputes over what was intended to be Rymes' or the Debtor's responsibility under the sale continue to remain, and the estate is poised to bring litigation against Rymes in the very near future. FRESH & EASY: Wants Exclusive Plan Filing Extended to June 28 ------------------------------------------------------------- Fresh Easy, LLC, asks the U.S. Bankruptcy Court for the District of Delaware to extend (i) the exclusive plan filing period by 30 days, through and including June 28, 2016, and (ii) the exclusive solicitation period by 30 days, through and including July 27, 2016; and (b) permitting the Debtor to extend the exclusive periods for three additional 30-day periods (for a total extension of 120 days) upon the submission, and entry, of a stipulated order between the Debtor and the Official Committee of Unsecured Creditors extending the Exclusive Periods. A hearing on the request is set for June 30, 2016, at 11:00 a.m. (ET). Objections to the request must be filed by June 10, 2016, at 4:00 p.m. (ET). The Debtor has been operating under the protection of Chapter 11 for approximately six months, and during this short period of time has made significant and material progress in administering the Chapter 11 case. The extension requested will provide the Debtor and its advisors the opportunity to fully negotiate, confirm and implement the terms of a Chapter 11 plan for the distribution of assets to creditors. As reported in its initial request for an extension of the Exclusive Period, in the first ninety days of the Chapter 11 case, the Debtor and its advisors worked diligently to administer this case as efficiently as possible to minimize administrative expenses and maximize the recovery available to all of the Debtor's stakeholders. The Debtor, among other things, (i) completed going-out-of-business sales at its retail locations; (ii) engaged real estate consultants to market and pursue the disposition of various leasehold interests; (iii) initiated a sales process through which it assumed and assigned certain leases and terminated additional leases with landlord consent, resulting in the successful disposition (through lease assignment, lease termination agreement, or rejection) of more than 100 of its leased locations, resulting in over $11 million of proceeds received to date; (iv) engaged an auctioneer and conducted an auction of certain assets at the Debtor's distribution center, resulting in over $5 million in proceeds; (v) established procedures for, and conducted and consummated, various miscellaneous asset sales; (vi) prepared and filed the Debtor's Schedules of Assets and Liabilities and Statements of Financial Affairs; (vii) prepared and filed the Debtor's monthly operating reports; (viii) established bar dates, including a General Bar Date, Governmental Bar Date, Administrative Claims Bar Date, Amended Schedules Bar Date and Rejection Bar Date, for creditors to file proofs of claim; (ix) established exclusive procedures governing the assertion, resolution and satisfaction of prepetition claims arising under the Perishable Agricultural Commodities Act, the Packers and Stockyards Act of 1921, and Section 503(b)(9) of the Bankruptcy Code; (x) evaluated and resolved requests for additional adequate assurance of future payment from certain utility providers; (xi) evaluated and rejected certain of the Debtor's executory contracts; (xii) retained Debtor's professionals; (xiii) established procedures for the retention of ordinary course professionals; (xiv) addressed, and resolved in a timely manner, challenges related to the Debtor's business and the Chapter 11 efforts; and (xv) responded to creditor inquiries. Since the entry of the first exclusivity extension order, the Debtor has continued to diligently prosecute the Chapter 11 case, by among other things: (i) reviewing and reconciling claims filed against the Debtor's estate asserting prepetition claims arising under the Perishable Agricultural Commodities Act and the Packers and Stockyards Act of 1921; (ii) reviewing and reconciling claims filed against the Debtor's estate asserting administrative priority pursuant to section 503(b)(9) of the Bankruptcy Code; (iii) selling certain equipment and other miscellaneous assets; (iv) selling liquor licenses, including negotiating purchase agreements; (v) working with various lease counterparties to resolve cure objections; (vi) resolving motions filed against the estate related to the extension of certain bar dates; (vii) filing amended Schedules of Assets and Liabilities and Statements of Financial Affairs; (viii) defending adversary proceedings, (ix) negotiating and obtaining approval of a post-petition Services Agreement with Tesco Stores Limited, (x) exiting the corporate headquarters for a smaller, less costly space; and (xi) addressing various other issues and tasks related to the administration of the Chapter 11 case. In addition, the Debtor has worked diligently to inform and involve the Committee in this Chapter 11 case and, most importantly, has arranged for and participated in non-binding mediation with the Committee and YFE. In particular, the Debtor, the Committee, and YFE, represented by both principals and professionals, participated in a daylong mediation with the Court-appointed mediator, Kenneth Klee, Esq., on May 19, 2016. No settlement was reached. The Debtor is working with the mediator, the Committee, YFE and the insurers to arrange a follow-up mediation session in June, although the parties have not agreed yet to a continued mediation. The Debtor intends to continue to consult and work cooperatively with the Committee on all major issues, including developing a plan. About Fresh & Easy Fresh & Easy, LLC, a chain of grocery stores in the Southwest United States, filed a Chapter 11 bankruptcy petition (Bankr. D. Del., Case No. 15-12220) on Oct. 30, 2015. The petition was signed by Peter McPhee, the chief financial officer. The Debtor estimated assets of $10 million to $50 million and liabilities of at least $100 million. Judge Christopher S. Sontchi is assigned to the case. The Debtor has engaged Cole Schotz P.C. as counsel, Epiq Bankruptcy Solutions, LLC, as claims and noticing agent, DJM Realty Services, LLC, and CBRE Group, Inc., as real estate consultants and FTI Consulting, Inc., as restructuring advisors. * * * The Debtor has undertaken the process of liquidating the estate's assets located at its retail locations and distribution center with the assistance of Hilco Merchant Resources, LLC, and Industrial Assets Corp., respectively, has engaged DJM Realty Services, LLC, and CBRE, Inc., to market its leasehold interests, and has recently engaged Hilco Streambank to assist with the disposition of its intellectual property. As part of the claims process, a bar date of Feb. 19, 2016, was established by the Court for creditor claims. GERMAN PELLETS: Seeks to Obtain $3.4MM DIP Financing from UMB ------------------------------------------------------------- German Pellets Texas, LLC, and Texas Pellets, Inc., seek authority from the U.S. Bankruptcy Court to obtain debtor in possession financing from UMB Bank, National Association, as Bond Trustee, in an interim amount not to exceed $3,434,000. The Debtors also seek authority from the Court to use cash collateral to cover their necessary operating expenses and ensure continued normal business operations of their wood pellet mill facility, to preserve and enhance the value of the Debtors' assets. The principal terms for the proposed DIP Facility and use of Cash Collateral, inter alia, are: 1. Lender: UMB Bank, National Association, as successor trustee with respect to the Sanger Texas Industrial Development Corporation Industrial Development Revenue Bonds (Texas Pellets Project), Series 2012B and 2012C issued under that certain Indenture of Trust, dated as of August 1, 2012. 2. Use of Proceeds: DIP Loan proceeds shall be used on an interim basis exclusively for (a) the necessary operation and maintenance costs associated with the Project in the amounts and categories and time set forth in the Budget, and (b) other costs and expenses of administration of the Chapter 11 Case. 3. Use of Cash Collateral: The Debtors' use of Cash Collateral is solely for: (a) the necessary operation and maintenance costs associated with the Project in the amounts and categories and time set forth in the Budget, (b) repayment of the Bridge Loan in full, and (c) other costs and expenses of administration of the Chapter 11 Case as set forth in the Budget. Use of Cash Collateral other than as set forth in this Interim Order, including in accordance with the Budget, shall be strictly prohibited. 4. Interest and Fees: The DIP Loans under the Interim Order shall not accrue under the Interim Order. Under the Final Order, however, the DIP Loans will accrue interest at a rate equal to [TBD]% per annum based upon the principal amount of necessary bonds issued to fund the DIP Loans, in the aggregate, under the Final Order. Upon the occurrence of an Event of Default, the DIP Loans shall accrue interest at a default rate of interest equal to 2% over the Applicable Rate and such interest will be payable on demand. 5. Maturity Date: The earliest to occur of the following: (a) the occurrence of an Event of Default, and (b) May 31, 2016. 6. Security and Priority to Bond Trustee for DIP Loans: Postpetition Liens, excluding Avoidance Actions, and a Superpriority Claim are granted to the Bond Trustee, subject only to the Carve-Out. 7. Adequate Protection to Bond Trustee for Prepetition Liens and Bond Claim: The Bond Trustee will receive: (a) Rollover Liens, (b) Supplemental Liens, (c) Prepetition Superpriority Claim, (d) Financial Reports, and (e) covenant to comply with certain terms of the Bond Documents (subject only to Carve-Out). In addition, the Bond Trustee, for the benefit of holders of the Bonds, shall be entitled to interest payments at the non-default contract rate. 8. Carve Out: (a) $100,000 for the sole benefit of the estate professionals and (b) the payment of bankruptcy fees pursuant to Section 1930. Milestones The DIP Financing agreement imposes these milestones: (a) On or before May 8, 2016, the Debtors shall file a motion with the Bankruptcy Court seeking the retention of an independent Chief Restructuring Officer acceptable to the Bond Trustee, upon such terms and conditions of retention acceptable to Debtors and the Bond Trustee. (b) The Bankruptcy Court shall have entered an order no later than May 15, 2016, in form and substance satisfactory to the Bond Trustee authorizing the Debtors' retention of the CRO. (c) On or before July 11, 2016, the Debtors shall file a motion with the Bankruptcy Court seeking the retention of an investment banker acceptable to the Bond Trustee, upon such terms and conditions of retention acceptable to the Debtors and Bond Trustee to solicit offers relating to the affiliation or acquisition of the Project through a section 363 sale or as a plan sponsor under a plan of reorganization. The Bankruptcy Court shall have entered an order no later than August 1, 2016, in form and substance satisfactory to the Bond Trustee approving the IB Motion. (d) On or before fourteen days after approval of the IB Motion, the Debtors and the Bond Trustee shall have agreed to a marketing and sale process with specific further milestone dates acceptable to the Bond Trustee. A full-text copy of the DIP Financing Motion dated May 03, 2016 is available at https://is.gd/eTGoF2 An attorney's checklist has been provided to respond to the Court's inquiry concerning material terms of the motions and orders pertaining to use of cash collateral and post-petition financing. Proposed Counsel for Debtors and Debtors in Possession: W. Steven Bryant, Esq. LOCKE LORD LLP 2800 JP Morgan Chase Tower 600 Travis Street Houston, Texas 77002 Telephone: (713) 226-1489 Facsimile: (713) 229-2536 Email: sbryant@lockelord.com -- and -- C. Davin Boldissar, Esq. Bradley C. Knapp, Esq. LOCKE LORD LLP 601 Poydras Street, Suite 2660 New Orleans, Louisiana 70130-6036 Telephone: (504) 558-5100 Facsimile: (504) 681-5211 Email: dboldissar@lockelord.com bknapp@lockelord.com GIYANI GOLD: Files Financial Statements & MD&A to Remedy Default ---------------------------------------------------------------- Giyani Gold Corp. (WDG) was in technical default as a non-venture filer of the provisions of NI 51-102 requiring the Company to file its Three Months Ended March 31, 2016 Financial Statements and MD&A by May 16, 2016 being 45 days after end of the year resulting from its listing on the Johannesburg Stock Exchange ("JSE"). The Company remedied this default by filing its Financial Statements and MD&A on May 27, 2016. Giyani Gold Corp. is a publicly traded company listed on the TSX Venture Exchange (TSXV: WDG) focused on conducting a strategic acquisition. GOGO INC: S&P Withdraws 'B-' Rating on Proposed Sr. Sec. Notes -------------------------------------------------------------- S&P Global Ratings withdrew its 'B-' issue-level rating and '3' recovery rating on Chicago-based Gogo Inc.'s proposed senior secured notes in response to the company's announcement that it intends not to proceed with the notes offering due to a proposal from an existing customer to provide connectivity service on a portion of its domestic fleet through ATG, ATG-4, and 2Ku technologies. While S&P views the proposal as a positive for the company, the 'B-' corporate credit rating and negative outlook remain unchanged. However, S&P will continue to monitor the situation for any potential impact to the rating as information becomes available. RATINGS LIST Gogo Inc. Corporate Credit Rating B-/Negative/-- Rating Withdrawn Gogo Inc. To From Senior Secured NR B- Recovery Rating NR 3H GREENBRIER COS: S&P Revises Outlook to Pos. & Affirms 'BB-' CCR --------------------------------------------------------------- S&P Global Ratings said it revised its rating outlook on Lake Oswego, Ore.-based The Greenbrier Cos. Inc. to positive from stable and affirmed its 'BB-' corporate credit rating on the company. "The company is operating with little adjusted net manufacturing debt, which provides cushion should industry prospects weaken over the next year or two, as we expect," said S&P Global Ratings credit analyst Dan Picciotta. "We will monitor the company's ability to manage through an industry decline and build its track record of a conservative approach to net debt levels." S&P could raise the rating over the next 12 months if Greenbrier demonstrates a conservative financial policy and limits deterioration in manufacturing profitability as the railcar market declines from peak levels. For an upgrade, S&P would expect Greenbrier to retain net adjusted manufacturing debt to EBITDA comfortably below 2x and double-digit manufacturing segment operating margin (19% in fiscal 2015). If conditions worsen to well below 40,000 industry deliveries, S&P would expect manufacturing net adjusted manufacturing debt to EBITDA of less than 3x to support an upgrade and for manufacturing segment operating margin to be maintained at more than 5%. S&P could revise the outlook to stable over the next 12 months if Greenbrier's financial policy becomes more aggressive or the company experiences meaningful deterioration in profitability. If S&P believes the cushion to absorb an industry downturn is compromised, we would revise the outlook to stable. If S&P was not confident that Greenbrier will operate with less than 1.5x manufacturing debt to EBITDA in normal industry conditions or if S&P believed this metric would deteriorate beyond 3x for any sustained period in a downturn, S&P would revise the outlook to stable. GREENHUNTER RESOURCES: Crady Jewett Represents Multiple Creditors ----------------------------------------------------------------- Crady, Jewett & McCulley, LLP, files with the U.S. Bankruptcy Court for the Northern District of Texas its Verified Statement Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure, stating that the firm represents these entities and individuals in the Chapter 11 bankruptcy cases of GreenHunter Resources, Inc., et al.: a. Baker Hughes Oilfield Operations, Inc. P.O. Box 4740 Houston, Texas 77210-4740 b. Baker Petrolite LLC P.O. Box 4740 Houston, Texas 77210-4740 Each of these entities holds a claim against one or more of the Debtors for services and materials furnished to Debtors. Crady Jewett says it does not own a claim or interest in any of the Debtors or the estates. None of the aforementioned claims have been assigned subsequent to the commencement of this case, and none have been solicited for purchase by Crady Jewett. At this time, Crady Jewett has no engagement letter with any of these entities. Crady Jewett does not believe that its representation of the interest of the entities listed above will create a conflict between, or be adverse to the interests of, any of these parties. Crady Jewett says it is not representing a committee. Pursuant to Bankruptcy Rule 2019(d), Crady Jewett will supplement this statement upon the material change of any fact. Crady Jewett can be reached at: CRADY, JEWETT & McCULLEY, LLP William R. Sudela, Esq. J. Daniel Long, Esq. 2727 Allen Parkway, Suite 1700 Houston, Texas 77019-2125 Phone: (713) 739-7007 Fax: (713) 739-8403 E-mail: wsudela@cjmlaw.com dlong@cjmlaw.com About Greenhunter Resources GreenHunter Resources, Inc. and 12 of its affiliates, providers of water management services, each filed a Chapter 11 petition (Bankr. N.D. Tex. Proposed Lead Case No. 16-40956) on March 1, 2016. Kirk J. Trosclair signed the petition as executive vice president and chief operating officer. The Debtors listed total assets of $36.29 million and total debts of $29.05 million. The Debtors have about $6 million in unsecured debt. Singer & Levick, P.C., serves as the Debtors' counsel. Russell F. Nelms has been assigned the case. GRIZZLY CATTLE: Judge Grants Bid to Appoint Chapter 11 Trustee -------------------------------------------------------------- A U.S. bankruptcy judge authorized the appointment of a Chapter 11 trustee for Grizzly Cattle, LLC. Judge Joseph Rosania, Jr., of the U.S. Bankruptcy Court in Colorado granted the requests of the U.S. trustee and Kloiber Real Estate Holdings LLC to appoint a bankruptcy trustee at a hearing on May 25. Judge Rosania authorized the appointment despite an objection from Grizzly Cattle, which the bankruptcy judge overruled, according to court filings. At the court hearing, Judge Rosania denied a bid by Grizzly Cattle to appoint an examiner. About Grizzly Cattle Grizzly Cattle, LLC, based in Johnstown, Colo., sought Chapter 11 protections (Bankr. D. Colo. Case No. 16-12675) on Mar. 24, 2016, and is represented by Robert Padjen, Esq., at Laufer and Padjan LLC. At the time of the filing, the Debtor estimated assets and debts of less than $10 million. The Debtor's chapter 11 petition was signed by Kirk A. Shiner, managing member. HANOVER PARMENTER: Seeks to Hire Cruickshank as Legal Counsel ------------------------------------------------------------- Hanover Parmenter Union, LLC seeks approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Gary Cruickshank of the Law Office of Gary W. Cruickshank as its attorney. The Debtor proposed to hire an attorney to assist in the formulation and presentation of its plan of reorganization, give advice about its duties as a debtor-in-possession, and provide other legal services. Mr. Cruickshank received $5,000, of which $3,000 was used to pay the Chapter 11 filing fee and the services he provided prior to the Debtor's bankruptcy. The remaining amount will serve as security retainer for services to be provided during the course of the case. In a court filing, Mr. Cruickshank disclosed that he is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Mr. Cruickshank can be reached through: Gary W. Cruickshank, Esq. 21 Custom House Street, Suite 920 Boston, MA 02110 Tel: (617)330-1960 E-mail: gwc@cruickshank-law.com About Hanover Parmenter Hanover Parmenter Union, LLC sought protection under Chapter 11 of the Bankruptcy Code in the District of Massachusetts (Boston) (Case No. 16-11784) on May 11, 2016. The petition was signed by Alyson Toombs, manager of Silvermine Development Partners LLC. The case is assigned to Judge Melvin S. Hoffman. The Debtor estimated assets of $1 million to $10 million and debts of $10 million to $50 million. HCSB FINANCIAL: Amends 23.4 Million Prospectus with SEC ------------------------------------------------------- HCSB Financial Corporation filed with the Securities and Exchange Commission a pre-effective amendment to its Form S-1 registration statement relating to the offering of up to 23,384,301 shares of its common stock, par value $0.01 per share, at a price of $0.10 per share. The Company is conducting the offering in connection with the recent completion of a private placement transaction pursuant to which it issued 359,468,443 shares of its common stock at $0.10 per share and 905,315.57 shares of a new series of convertible perpetual non-voting preferred stock, Series A, par value $0.01 per share, at $10.00 per share for cash proceeds of $45 million. "We are now conducting this offering primarily to provide our legacy shareholders, employees and others in our community with an opportunity to invest in the Company at the same offering price of $0.10 per share that we offered to the investors in the private placement, although we reserve the right to permit other persons to invest, including the investors from the private placement." A minimum investment of $10,000 is required to purchase shares in the offering, which requirement the Company may waive in its sole discretion. The Company will not use an underwriter or selling agent for this offering. Shares of common stock offered in the offering will be sold directly by the Company through the efforts of its executive officers and directors without compensation. The offering will expire upon the earlier of the sale of all 23,384,301 shares of common stock or at 5:00 p.m., Eastern Standard time, on June 30, 2016, unless extended for up to an additional 30 days by the Company's board of directors, in their sole discretion. The Company does not intend to extend the expiration date beyond July 30, 2016. The offering will be made directly by the Company. The Company's common stock is quoted on the OTC Pink marketplace under the symbol "HCFB". On May 24, 2016, the closing price of the Company's common stock as reported by the OTC Pink marketplace was $0.25 per share. A copy of the regulatory filing is available for free at: https://is.gd/W6cPLK About HCSB Financial Loris, South Carolina-based HCSB Financial Corporation was incorporated on June 10, 1999, to become a holding company for Horry County State Bank. The Bank is a state chartered bank which commenced operations on Jan. 4, 1988. From its 13 branch locations, the Bank offers a full range of deposit services, including checking accounts, savings accounts, certificates of deposit, money market accounts, and IRAs, as well as a broad range of non-deposit investment services. During the third quarter of 2011, the Bank closed its Covenant Towers branch located at Myrtle Beach. All deposits were transferred to the Bank's Myrtle Beach branch and the Bank does not expect any disruption of service in that market for its customers. HCSB Financial reported a net loss available to common shareholders of $1.75 million on $13.7 million of total interest income for the year ended Dec. 31, 2015, compared to a net loss available to common shareholders of $1.40 million on $16.09 million of total interest income for the year ended Dec. 31, 2014. As of March 31, 2016, HCSB Financial had $363 million in total assets, $378 million in total liabilities and a total shareholders' deficit of $14.6 million. Elliott Davis Decosimo, LLC, in Columbia, South Carolina, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company has suffered recurring losses that have eroded regulatory capital ratios and the Company's wholly owned subsidiary, Horry County State Bank, is under a regulatory Consent Order with the Federal Deposit Insurance Corporation (FDIC) that requires, among other provisions, capital ratios to be maintained at certain levels. As of December 31, 2015, the Company's subsidiary is considered significantly undercapitalized based on its regulatory capital levels. These considerations raise substantial doubt about the Company's ability to continue as a going concern. The Company also has deferred interest payments on its junior subordinated debentures for 20 consecutive quarters as of December 31, 2015. Under the terms of the debentures, the Company may defer payments for up to 20 consecutive quarters without creating a default. Payment for the 20th quarterly interest deferral period was due in March 2016. The Company failed to pay the deferred and compounded interest at the end of the deferral period, and the trustees of the corresponding trusts, have the right, after any applicable grace period, to exercise various remedies, including demanding immediate payment in full of the entire outstanding principal amount of the debentures. The balance of the debentures and accrued interest as of December 31, 2015 were $6,186,000 and $901,000, respectively. These events also raise substantial doubt about the Company's ability to continue as a going concern as of December 31, 2015. HERC RENTALS: Moody's Assigns B1 CFR, Outlook Stable ---------------------------------------------------- Moody's Investors Service assigned a B1 Corporate Family Rating and a B1-PD Probability of Default Rating ("PDR") to Herc Rentals Inc., (a/k/a Hertz Equipment Rental Corporation, or HERC) the new public company that is being separated from The Hertz Corporation through a spin-off. Moody's rated HERC's new $1.75 billion ABL Ba2 and assigned a B3 to the $1.1 billion Senior Secured Second Priority Notes issued by Herc Spinoff Escrow Issuer, LLC jointly with Herc Spinoff Escrow Issuer, Corp. Hertz Equipment Rental Corporation (HERC) is to merge with each of the Escrow Issuers, with HERC continuing as the surviving entity, and will assume the Escrow Issuers' obligations as issuer of the Notes. Approximately $1.9 billion from the proceeds are expected to be transferred to The Hertz Corporation in connection with the spin-off and related transactions. Moody's also assigned a SGL-3 to reflect HERC's adequate near term liquidity profile. The rating outlook is stable. Moody's has assigned these ratings: Corporate Family Rating, B1; Probability of Default Rating, B1-PD; Senior Secured First Lien Revolving Credit Facility, Ba2 (LGD2); Senior Secured Second Priority Notes, B3 (LGD5); Speculative Grade Liquidity Rating, SGL-3; Stable Outlook RATINGS RATIONALE The rating assignment reflects the company's expected Debt to EBITDA at 3.6x for 2016, strong market position as one of the top four equipment rental companies in the U.S. The company' decision to reduce its capital expenditures to reflect market weakness is considered a significant credit positive as it should support free cash flow, improves equipment utilization on its remaining fleet and helps support margins. The factors are balanced against an investment philosophy that was visible in 2015's high capital expenditures and the possibility that its capital expenditures may be oversized (for its balance sheet) during the next market rebound thereby increasing leverage. The Ba2 rating on the company's ABL reflects a first lien claim on certain choice assets, including eligible rental assets, accounts receivable, service vehicles and spare parts. The ABL facility has a springing fixed charge coverage ratio test that is triggered if availability falls below 10% of the total commitment on any date. Moody's do not expect the covenant test to be triggered. The Second Lien Notes' B3 rating reflects its junior position relative to the security interest of the asset-based revolving credit facility. The Notes will be guaranteed, on a second lien secured basis, by each of the company's wholly owned direct and indirect domestic existing and future wholly owned direct and indirect domestic subsidiaries that will guarantee obligations under the ABL Credit Facility. The assigned SGL-3 liquidity rating reflects an adequate liquidity profile characterized by ample availability under its asset-based revolving credit facility and long dated maturities. In addition, availability under the asset-based credit facility is expected to comfortably exceed the minimum availability threshold required before the fixed charge coverage ratio covenant would become applicable. Moody's expects free cash flow to be negative in 2016 as a result of high capital expenditure requirements to support revenue growth and one-time spin-off related costs; however, capital spending is expected to decline in 2017 and positive free cash flow generation is expected. The company is expected to be reliant on its $1.75 billion borrowing based facility. At time of the spin-off, borrowings are expected to stand at approximately $787 million. The borrowing base level is expected to be close to the face amount of the facility over the intermediate term. The majority of the proceeds from the Second Priority Notes and ABL borrowings will fund a $1.9 billion distribution to the current parent company Hertz Corporation, to achieve a tax-free reverse spin-off. The stable outlook reflects HERC's strong market position and the expectation that leverage will be maintained below the 4.25x level. Capital expenditures are expected to decrease over the next year. The stable outlook is also supported by good U.S. equipment rental industry fundamentals that support rentals over ownership. Downward pressure on the ratings could occur if the company's liquidity profile were to weaken, debt/EBITDA were to reach and be sustained above 4.25x and EBITDA / Interest were to fall below 4.3x. Positive rating pressure would require the expectation that HERC would further improve its liquidity profile, sustain debt/EBITDA at 3.0x or below while maintaining EBITDA margin at above 38%. The principal methodology used in this rating was the Equipment and Transportation Rental Industry methodology published in December 2014. Herc Rentals, based in Bonita Springs, Florida, is an equipment rental company with 280 branches globally, of which 270 are in North America. Herc Rentals is being separated from Hertz Corporation, and will trade separately in the public market. Revenues for the fiscal year ended Dec. 31, 2015, totaled approximately $1.7 billion. HERC RENTALS: S&P Affirms 'B+' Rating on Proposed Sr. Sec. Notes ---------------------------------------------------------------- S&P Global Ratings revised its recovery rating on U.S.-based HERC Rentals Inc.'s proposed senior secured second-lien notes to '4' from '3' and affirmed its 'B+' issue-level rating on the notes following the company's announcement that it plans to upsize the issuance to an aggregate $1.235 billion from $1.1 billion originally. The '4' recovery rating indicates S&P's expectation of average (30%-50%; upper end of the range) recovery in the event of a payment default. The revised recovery rating reflects S&P's assessment that there will now be more second-lien debt outstanding at default compared with S&P's previous analysis, diluting recovery prospects for the second-lien noteholders. Herc Spinoff Escrow Issuer LLC and Herc Spinoff Escrow Issuer Corp. will co-issue the proposed second-lien notes. All of S&P's other ratings on HERC Holdings Inc. and HERC Rentals Inc. remain unchanged. RATINGS LIST HERC Holdings Inc. HERC Rentals Inc. Corporate Credit Rating B+/Stable/-- Issue Rating Affirmed; Recovery Rating Revised To From HERC Rentals Inc. Herc Spinoff Escrow Issuer, Corp. Herc Spinoff Escrow Issuer, LLC Senior Secured 2nd-Lien B+ B+ Recovery Rating 4H 3L HERCULES OFFSHORE: To File for Ch. 11 Again and Liquidate --------------------------------------------------------- Stephanie Gleason and Anne Steele, writing for Daily Bankruptcy Review, reported that Hercules Offshore Inc. said it would again file for chapter 11, this time planning to liquidate as the ocean driller goes out of business amid the long swoon in oil prices. According to the report, less than seven months after exiting bankruptcy with $450 million in fresh financing and a lighter debt load, Hercules said on May 27 that it reached a deal with 99% of its senior lenders that will be executed with a so-called "prepackaged" chapter 11 filing. Hercules's plan, which would ultimately be subject to bankruptcy-court approval, would see the company liquidate its assets and use the proceeds to repay creditors, the report related. The company expects to be able to pay unsecured creditors in full and provide as much as $12.5 million to shareholders, the report said. The company said on May 27 it has already it lined up a $196 million offer for its harsh environment jack-up rig, formerly named Hercules Highlander, to Maersk Highlander UK Ltd, the report added. Hercules cited "the ongoing decline in oil prices, the consolidation of its U.S. customer base and the addition of new capacity have negatively impacted day rates and demand for Hercules's services" as reasons for its distress, the report further related. About Hercules Offshore Headquartered in Houston, Hercules Offshore, Inc. -- http://www.herculesoffshore.com/-- operates a fleet of 27 jackup rigs, including one rig under construction, and 21 liftboats. The Company offers a range of services to oil and gas producers to meet their needs during drilling, well service, platform inspection, maintenance, and decommissioning operations in several key shallow water provinces around the world. On Aug. 13, 2015 Hercules Offshore and 14 affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 15-11685) in the U.S. Bankruptcy Court for the District of Delaware. The cases are pending before the Honorable Kevin J. Carey. The Debtors tapped Baker Botts LLP as counsel; Morris, Nichols, Arsht & Tunnell, as local counsel; Andrews Kurth LLP, as general corporate counsel; Lazard Freres & Co. LLC, as investment banker, Alvarez & Marsal, as restructuring advisor; and Prime Clerk, LLC, as claims and noticing agent. The Steering Group of Holders of Senior Notes is represented by Akin Gump Strauss Hauer & Feld LLP's Arik Preis, Esq., and Michael S. Stamer, Esq. HERO disclosed $546 million in assets and $1.306 billion in debt as of Aug. 11, 2015. * * * The Debtors on the Petition Date filed a pre-packaged Chapter 11 plan that would convert $1.2 billion of outstanding senior notes to 96.9% of new common equity. The Debtors notified the U.S. Bankruptcy Court for the District of Delaware that Effective Date of their Joint Prepackaged Plan of Reorganization occurred on Nov. 6, 2015. On Sept. 24, 2015, the Court approved the Debtors' solicitation and Disclosure Statement; and confirmed the Prepackaged Plan. HI-CRUSH PARTNERS: S&P Lowers Corp. Credit Rating to B- ------------------------------------------------------- S&P Global Ratings said it lowered its corporate credit rating on Houston-based industrial sand producer Hi-Crush Partners LP to 'B-' from 'B+'. The outlook is negative. At the same time, S&P lowered the issue-level rating on the company's senior secured debt to 'B+' from 'BB-'. S&P also raised the recovery rating to '1' from '2', indicating its expectation for very high (90%-100%) recovery of principal and interest in the event of a payment default. "The negative outlook reflects our expectation for continued pressure on Hi-Crush's liquidity position over at least the next 12 months as cash flows remain weak due to reduced drilling and completion activity and weak demand and pricing for frac sand," said S&P Global Ratings credit analyst Ryan Gilmore. "As a result, we expect the company will maintain credit measures at a level consistent with a highly leveraged financial risk assessment, including debt to EBITDA above 15x and EBITDA interest coverage of 1x in 2016." S&P could lower the rating if it no longer deemed liquidity to be adequate as indicated by sources over uses of less than 1.2x over the next 12 months. This could occur if demand and prices for frac sand remained at current levels, resulting in accelerated cash and revolving credit facility usage. A negative rating action could also occur if EBITDA interest coverage were sustained below 1x, which could occur if 2016 adjusted EBITDA fell below $20 million, all else being equal. S&P could also downgrade Hi-Crush if the company's financial commitments appeared to be unsustainable in the long term. This could be the result of protracted weakness in the oil and gas sector. It is unlikely that S&P would raise the rating in the next 12 months given the weakness in Hi-Crush's operating environment. However, S&P could consider revising the outlook to stable within the next year if oil prices increased and drilling and completion activity stabilized or showed improvement. S&P would consider an upgrade if it viewed Hi-Crush's business risk profile to be more consistent with a weak assessment. This could be the result of a strengthened competitive position due to improved profitability, increased scale, or other factors. S&P could also consider an upgrade if the company achieved sustainable improvement in credit measures, with debt to EBITDA of less than 5x and EBITDA interest coverage above 2x. This could occur in the longer term if prices or volumes rose meaningfully from current levels. HONEY BEE: State of Hawaii Opposes Financing Motion --------------------------------------------------- The State of Hawaii submitted to the U.S. Bankruptcy Court for the District of Hawaii its opposition to Honey Bee USA, Inc.'s motion seeking authorization to obtain final postpetition financing. David D. Day, Esq., at the Department of the Attorney General, State of Hawai'i, in Honolulu, Hawaii, contends that the Financing Motion, as it affects the State, is merely a supplement to the Motion to Approve Assumption of Boating Lease, or in the Alternative, to Extend Time to Assume Lease. Mr. Day further contends that the State opposed the Motion to Assume Lease, arguing that, among other things, Boating Lease No. BO-13120 automatically terminated on November 15, 2015, and was no longer a part of the bankruptcy estate; that the Debtor could not cure certain defaults under the Lease, including lapsed construction deadlines; and that the Debtor's proposed financing was plainly inadequate. Mr. Day relates that during the April 11, 2016 hearing on the Motion to Assume Lease, the Court deferred ruling on the Motion to Assume Lease and required the Debtor to file a financing motion to address significant deficiencies in the Motion to Assume Lease, especially Debtor's failure to provide adequate assurance of future performance owed to the State under the Lease. "The State respectfully requests that the Motions be denied. First, this Court should deny the Motions because the Lease cannot be assumed as a matter of law because it automatically terminated on November 15, 2015. Second, the proposed financing purports to give a mortgage on the leasehold without the Chairperson of the Board of Land and Natural Resource's prior written consent in violation of the Lease and Hawai'i law. Third, the proposed financing does not provide adequate assurance of prompt cure of the outstanding defaults on the Lease or provide adequate assurance of future performance," Mr. Day avers. Support for Financing Motion Secured creditor Melvin and Jean Nakagawa Family Limited Partnership acknowledges that its Mortgage will be subordinated to the lien of the new lender if the Debtor's Financing Motion is granted. The Nakagawa Partnership nevertheless recognizes that for the Debtor to successfully reorganize, it must obtain financing and contends that the Debtor's requested post-petition financing is reasonable and appropriate. Another entity, Choate Construction Services, LLC, says it supports the Debtor's Financing Motion on the condition that (1) any relief does not affect Choate's mechanic's lien and claim plus attorneys' fees, interest, and any other relief that Choate may be entitled to against Honey Bee and (2) that Honey Bee be obligated to utilize such financing to cure the monetary defaults currently existing under the Boating Lease, including Choate's mechanic lien. Choate further contends that the Boating Lease is the Debtor's only asset of real value and that preserving the Boating Lease is imperative to protecting the value of the Bankruptcy Estate. The Motion is scheduled for hearing on June 6, 2016 at 2:00 p.m. Melvin and Jean Nakagawa Family Limited Partnership is represented by: Steven Guttman, Esq. Dawn Egusa, Esq. KESSNER UMEBAYASHI BAIN & MATSUNAGA 220 South King Street, Suite 1900 Honolulu, HI 96813 Telephone: (808)536-1900 Facsimile: (808)529-7177 E-mail: kdubm_bk@kdubm.com The State of Hawai'i is represented by: Douglas S. Chin, Esq. David D. Day, Esq. DEPARTMENT OF THE ATTORNEY GENERAL, STATE OF HAWAI'I 425 Queen Street Honolulu, HI 96813 Telephone: (808)587-2900 E-mail: david.d.day@hawaii.gov Choate Construction Services, LLC, is represented by: Karin L. Holma, Esq. Christian D. Chambers, Esq. Kristin A. Shinkawa, Esq. BAYS LUNG ROSE & HOLMA Topa Financial Center 700 Bishop Street, Suite 900 Honolulu, HI 96813 Telephone: (808)523-9000 Facsimile: (808)533-4184 E-mail: kholma@legalhawaii.com cchambers@legalhawaii.com kshinkawa@legalhawaii.com HONEY BEE: State of Hawaii Opposes Financing Motion --------------------------------------------------- The State of Hawaii submitted to the U.S. Bankruptcy Court for the District of Hawaii its opposition to Honey Bee USA, Inc.'s motion seeking authorization to obtain final postpetition financing. David D. Day, Esq., at the Department of the Attorney General, State of Hawai'i, in Honolulu, Hawaii, contends that the Financing Motion, as it affects the State, is merely a supplement to the Motion to Approve Assumption of Boating Lease, or in the Alternative, to Extend Time to Assume Lease. Mr. Day further contends that the State opposed the Motion to Assume Lease, arguing that, among other things, Boating Lease No. BO-13120 automatically terminated on November 15, 2015, and was no longer a part of the bankruptcy estate; that the Debtor could not cure certain defaults under the Lease, including lapsed construction deadlines; and that the Debtor's proposed financing was plainly inadequate. Mr. Day relates that during the April 11, 2016 hearing on the Motion to Assume Lease, the Court deferred ruling on the Motion to Assume Lease and required the Debtor to file a financing motion to address significant deficiencies in the Motion to Assume Lease, especially Debtor's failure to provide adequate assurance of future performance owed to the State under the Lease. "The State respectfully requests that the Motions be denied. First, this Court should deny the Motions because the Lease cannot be assumed as a matter of law because it automatically terminated on November 15, 2015. Second, the proposed financing purports to give a mortgage on the leasehold without the Chairperson of the Board of Land and Natural Resource's prior written consent in violation of the Lease and Hawai'i law. Third, the proposed financing does not provide adequate assurance of prompt cure of the outstanding defaults on the Lease or provide adequate assurance of future performance," Mr. Day avers. Support for Financing Motion Secured creditor Melvin and Jean Nakagawa Family Limited Partnership acknowledges that its Mortgage will be subordinated to the lien of the new lender if the Debtor's Financing Motion is granted. The Nakagawa Partnership nevertheless recognizes that for the Debtor to successfully reorganize, it must obtain financing and contends that the Debtor's requested post-petition financing is reasonable and appropriate. Another entity, Choate Construction Services, LLC, says it supports the Debtor's Financing Motion on the condition that (1) any relief does not affect Choate's mechanic's lien and claim plus attorneys' fees, interest, and any other relief that Choate may be entitled to against Honey Bee and (2) that Honey Bee be obligated to utilize such financing to cure the monetary defaults currently existing under the Boating Lease, including Choate's mechanic lien. Choate further contends that the Boating Lease is the Debtor's only asset of real value and that preserving the Boating Lease is imperative to protecting the value of the Bankruptcy Estate. The Motion is scheduled for hearing on June 6, 2016 at 2:00 p.m. Melvin and Jean Nakagawa Family Limited Partnership is represented by: Steven Guttman, Esq. Dawn Egusa, Esq. KESSNER UMEBAYASHI BAIN & MATSUNAGA 220 South King Street, Suite 1900 Honolulu, HI 96813 Telephone: (808)536-1900 Facsimile: (808)529-7177 E-mail: kdubm_bk@kdubm.com The State of Hawai'i is represented by: Douglas S. Chin, Esq. David D. Day, Esq. DEPARTMENT OF THE ATTORNEY GENERAL, STATE OF HAWAI'I 425 Queen Street Honolulu, HI 96813 Telephone: (808)587-2900 E-mail: david.d.day@hawaii.gov Choate Construction Services, LLC, is represented by: Karin L. Holma, Esq. Christian D. Chambers, Esq. Kristin A. Shinkawa, Esq. BAYS LUNG ROSE & HOLMA Topa Financial Center 700 Bishop Street, Suite 900 Honolulu, HI 96813 Telephone: (808)523-9000 Facsimile: (808)533-4184 E-mail: kholma@legalhawaii.com cchambers@legalhawaii.com kshinkawa@legalhawaii.com HORSEHEAD HOLDING: Committee Seeks Standing to Sue US Bank ---------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the Chapter 11 Cases of Horsehead Holding Corp., et al., seeks the U.S. Bankruptcy Court's authority to commence, prosecute and settle, if appropriate, an adversary proceeding on behalf of the estates of Horsehead Holding Corp., et al., against U.S. Bank National Association, as Trustee and collateral agent for the Prepetition Senior Secured Noteholders. The Committee has undertaken an investigation of the liens and security interests on the Debtors' assets asserted by U.S. Bank, and as a result of its investigation, the Committee believes that the Debtors' estates have valid causes of action to challenge the extent, validity, priority and perfection of security interests asserted by U.S. Bank and the Prepetition Senior Secured Noteholders in certain assets of the Debtors. In order to ensure the causes of action are in fact pursued in an efficient manner, the Committee sent a request to the Debtors outlining the claims and asking the Debtors to either commence a lawsuit to prosecute the claims or consent to the Committee's standing and authority, however, the Debtors have not given their consent nor have they advised the Committee that they will prosecute the matter. Mooresboro Facility The Committee challenges the validity of the Deed of Trust on the Mooresboro Facility as it failed to properly identify the obligation secure, the correct amount, the correct borrower and lender, and the correct guaranty, and as such, it is invalid and unenforceable, to wit: (a) The cover page of the deed of trust states that it has been made by Horse Metal Products, LLC ("HMP") for the benefit of U.S. Bank but the actual text demonstrates that it has been granted for the benefit of PNC Bank, National Association under a Revolving Credit and Security Agreement with PNC Bank ("PNC Credit Agreement). (b) The deed of trust recites that Horsehead Corporation is the borrower under the PNC Credit Agreement and issued a $60 million note, but the PNC Credit Agreement -- a separate credit facility and not used for the construction of the Mooresboro Facility -- has been refinanced pursuant to a Credit Agreement by and among Macquarie Bank Limited, as administrative agent and the Lenders party, and Horsehead Corporation, International Metals Reclamation Company, LLC ("INMETCO") and HMP as Macquarie Borrowers, under which Macquarie and Lenders committed to make loans and other financial accommodations to the Macquarie Borrowers consisting of revolving loans of up to $80 million. Palmerton Facility on Premises B The Committee asserts colorable claims against the validity, enforceability, priority and extent of the alleged lien on Premises B held by U.S. Bank on behalf of Prepetition Senior Secured Noteholders because no mortgage has been filed or recorded for Premises B -- the mortgage by Horsehead Corpoation to U.S. Bank, in connection with the Palmerton Facility, purports to grant U.S. Bank a lien on the Real Estate covering parcels known as Premises A only. However, the Palmerton Facility is also comprised of parcels identified under Premises B. INMETCO Stock According to the Committee, U.S. Bank has not been granted a lien on or pledge of the stock of INMETCO because pursuant to the Prepetition Senior Secured Notes Security Agreement, U.S. Bank has been granted a security interest in the Prepetition Senior Secured Notes Personal Property Collateral with certain express exclusions, one of which is the "Excluded Stock" -- defined as "shares of Capital Stock, and stock certificates, option or rights of any nature whatsoever in respect of such Capital Stock of INMETCO and Horsehead Corporation that may be issued or granted to, or held by, Holding." A hearing to consider the Committee's Motion will be held on June 20, 2016. Counsel to the Official Committee of Unsecured Creditors: Bruce Buechler, Esq. Kenneth A. Rosen, Esq. Nicole Stefanelli, Esq. LOWENSTEIN SANDLER LLP 65 Livingston Avenue Roseland, New Jersey 07068 Telephone: (973) 597-2500 Facsimile: (973) 597-6247 Email: bbuechler@lowenstein.com krosen@lowenstein.com nstefanelli@lowenstein.com -- and -- Curtis A. Hehn, Esq. LAW OFFICE OF CURTIS A. HEHN 1000 N. West Street, Suite 1200 Wilmington, Delaware 19801 Telephone: (302) 295-5044 Facsimile: (302) 295-4081 Email: curtishehn@comcast.net About Horsehead Holding Corp. 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 Debtors currently employ approximately 730 full-time individuals. Horsehead Holding Corp., Horsehead Corporation, Horsehead Metal Products, LLC, The International Metals Reclamation Company, LLC, and Zochem Inc. filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10287 to 16-10291) on Feb. 2, 2016. The petition was signed by Robert D. Scherich as vice president and chief financial officer. Judge Christopher S. Sontchi is assigned to the case. The Debtors have engaged Kirkland & Ellis LLP as general counsel, Pachulski Stang Ziehl & Jones LLP as local counsel, RAS Management Advisors, LLC as financial advisor, Lazard Middle Market LLC as investment banker, Epiq Bankruptcy Solutions, LLC as claims and noticing agent and Aird & Berlis LLP as Canadian counsel. The Debtors disclosed total assets of $1 billion and total liabilities of $544.6 million. As of the Petition Date, the Debtors' consolidated long-term debt obligations totalled approximately $420.7 million. Andrew Vara, acting U.S. trustee for Region 3, appointed seven creditors of Horsehead Holding Corp. to serve on the official committee of unsecured creditors. Lowenstein Sandler LLP serves as counsel to the Committee, while Drinker Biddle & Reath LLP serves as co-counsel. IAC/INTERACTIVECORP: Moody's Assigns Ba3 Rating on $400MM Notes --------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to the proposed $400 million senior unsecured notes due 2024 to be issued by Match Group, Inc., IAC/InterActiveCorp's ("IAC" or the "company") 85% owned subsidiary that comprises its online dating businesses. Net proceeds from the new notes, which will not be guaranteed by IAC, will be used to retire a like amount of Match's term loan B obligation. The rating outlook is stable. Rating Assigned: Issuer: Match Group, Inc. $400 Million Senior Unsecured Notes due 2024 -- Ba3 (LGD-4) The assigned rating is subject to review of final documentation and no material change in the size, terms and conditions of the transaction as advised to Moody's. RATINGS RATIONALE IAC's Ba2 Corporate Family Rating is supported by its position as one of the largest global Internet and digital media companies with online properties that have established brand names and reasonably long operating histories. The Ba2 rating recognizes IAC's good operating performance driven by a business model which has historically demonstrated respectable online audience reach via search engine analytics, marketing and display advertising, and good, albeit declining, traffic monetization in the Publishing and Applications segments; strong subscriber growth trends in the online dating segment; a disciplined acquisition/investment strategy; and rationalization of underperforming portfolio assets. Moody's expects annual free cash flow in the range of $200 - $300 million and financial leverage, as measured by total debt to EBITDA, in the 3x-4x range (Moody's adjusted). As of March 31, 2016, pro forma leverage was 4.1x (incorporating Moody's standard adjustments and PlentyofFish's LTM EBITDA contribution). Moody's project EBITDA growth to gradually reduce leverage to around 3.5x by the end of 2016. Moody's believes IAC will maintain very good liquidity (SGL-1) supported by a sizable cash position (cash and cash equivalents totaled over $1.2 billion as of March 31) and revolving credit facilities totaling $800 million, which provide flexibility to pursue strategic growth objectives. The Ba2 rating also incorporates the inherent risk that Internet businesses could experience a potential decline in website traffic due to rapidly changing technology and industry standards. Alternative means of content delivery as well as shifts in consumer engagement may also contribute to the risk of rapid obsolescence or waning relevance of traditional portal Internet sites. The rating is constrained by IAC's dependence on the partnership with Google and potential changes to Google's search algorithms that could hurt IAC's listings placements. It also reflects the concentrated earnings profile (primarily Match and Applications) and sizeable exposure to digital advertising revenue, which could become more cyclical in the future. IAC's historically aggressive financial policies combined with the large voting stake of Mr. Barry Diller heightens event risk. The Ba2 rating is constrained by the risk of an eventual divestiture of the high margin Match unit that could reduce diversity and scale, and increase IAC's business risk. Moody's derives Match's debt ratings from IAC's CFR using the Loss Given Default (LGD) Methodology based on our expectation of IAC's continued majority ownership of Match post-IPO. However, if Match were to become a standalone entity or less than majority-owned by IAC, Match's ratings would be de-linked from IAC's CFR and would be based on its standalone creditworthiness. Match's term loan is rated Ba2 as it is secured by capital stock of Match's material domestic subsidiaries and benefits from upstream guarantees. The term loan would likely experience a deficiency claim in a distressed scenario given that we estimate the asset value at Match would be insufficient to fully repay the credit facilities, which caps the term loan rating at the CFR. Match's unsecured notes are rated Ba3 as they do not benefit from upstream guarantees nor a security interest in collateral. Though the proposed transaction will reduce secured term loan debt and increase unsecured debt by a like amount, ratings and LGD assessments on the existing debt instruments remain unchanged under our LGD framework. Rating Outlook The stable rating outlook reflects our expectations that IAC will continue to at least maintain its market positions in the Applications and Publishing segments, grow its Match, HomeAdvisor and Video segments, and experience a reasonable amount of subscriber churn in its Internet portfolio. The stable outlook incorporates our expectation that IAC will continue to maintain a consolidated EBITDA margin of at least 14% (Moody's adjusted), generate positive free cash flow, retain a sizeable cash balance and sustain a somewhat conservative capital structure as it pursues strategic growth objectives. What Could Change the Rating - Up Ratings could be upgraded if IAC maintains a majority ownership and leading market share in Match, improves the market positions and viability of Applications and Publishing and expands business diversification by increasing the scale and profitability of the HomeAdvisor and Video segments. Moody's could also consider an upgrade to the extent we expect IAC to: (i) demonstrate margin expansion with increasing revenue that is in line or ahead of market growth; (ii) minimize operating losses in the Media segment; and (iii) maintain a net cash position with Moody's adjusted total debt to EBITDA sustained below 3x. An important consideration for an upgrade would be adherence to conservative financial policies with regard to share purchases and dividends. What Could Change the Rating - Down Ratings could be downgraded if a spin-off of one or more segments resulted in increased business risk or IAC's competitive position weakens materially as evidenced by revenue declines of 5% or more, adjusted EBITDA margins below 12%, rising traffic acquisition costs or increasing customer churn. Downward pressure could also materialize if financial leverage as measured by Moody's adjusted total debt to EBITDA is sustained over 4x or IAC's liquidity position were to deteriorate significantly due to lower free cash flow generation, higher share purchases or increased acquisition activity. The principal methodology used in this rating was the Global Broadcast and Advertising Related Industries Methodology published in May 2012. Headquartered in New York , N.Y., IAC/InterActiveCorp is a leading media and online company that owns various Internet-based brands and products including: Ask.com (search engine); About.com, Dictionary.com, Investopedia.com (online content and reference libraries), Ask.fm (social) and Apalon (mobile applications); Match Group, Inc. (online dating assets, including Match, Tinder and OkCupid; and non-dating asset, The Princeton Review); HomeAdvisor, ShoeBuy (e-commerce); Vimeo (video); and several other consumer-related applications and portals. Revenue totaled approximately $3.3 billion for the twelve months ended March 31, 2016. IMMC CORPORATION: Liquidating Trustee's Appeals Case Reopened ------------------------------------------------------------- Judge Gregory M. Sleet of the United States District Court for the District of Delaware granted the motion filed by Robert F. Troisio to reopen the appeals case captioned ROBERT F. TROISIO, as Liquidating Trustee of IMMC CORPORATION, f/k/a IMMUNICON CORPORATION, Appellant, v. EDWARD L. ERICKSON, BYRON HEWETT, LEON TERSTAPPEN, JAMES L. WILCOX, ELIZABETH E. TALLETT, J. WILLIAM FREYTAG, ZOLA P. HOROWITZ, JAMES G. MURPHY, BRIAN GEIGER, JONATHAN COOL, and ALLEN J. LAUER, Appellees, Adv. Proc. No. 10-53063 (BLS), Civ. No. 15-1043 (GMS) (D. Del.). Troisio, the liquidating trustee of IMMC Corporation (f/k/a Immunicon Corporation), sought an order to reopen the above-captioned appeal so that the parties may proceed on the merits before the Court. The Motion to Reopen follows the court's Memorandum Opinion and Order granting the appellant's motion for certification of direct appeal to the United States Court of Appeals for the Third Circuit, and the appellant's subsequent failure to file a request for permission with the circuit clerk as required by Federal Rule of Bankruptcy Procedure 8006(g). Judge Sleet granted the Motion to Reopen and the appellant was directed to show cause why he should not reimburse the appellees for the fees and costs incurred in opposing the Certification Motion. A full-text copy of Judge Sleet's May 17, 2016 memorandum opinion is available at https://is.gd/aPDlg5 from Leagle.com. The bankruptcy case is IN RE: IMMC CORPORATION, f/k/a IMMUNICON CORPORATION, et al., Chapter 11 Debtors, Bankr. Case No. 08-11178 (KJC) (Bankr. D. Del.). Robert F. Troisio is represented by: Jason C. Powell, Esq. THE POWELL FIRM, LLC 2050 Marconi Dr, Ste 300 Alpharetta, GA 30005 Tel: (770)695-0186 -- and -- Lisa L. Coggins, Esq. FERRY, JOSEPH & PEARCE, P.A. 824 Market St. Suite 1000 Wilmington, DE 19801 Tel: (302) 575-1555 Fax: (302) 575-1714 Email: lcoggins@ferryjoseph.com Edward L. Erickson, Bryon Hewett, Leon Terstappen, James L. Wilcox, Elizabeth E. Tallett, J. William Freytag, Zola P. Horovitz, James G. Murphy, Brian Geiger, Jonathan Cool, Allen J. Lauer are represented by: Learon John Nelson Bird, Esq. FOX ROTHSCHILD LLP Citizens Bank Center 919 North Market Street, Suite 300 Wilmington, DE 19899-2323 Tel: (302)654-7444 Fax: (302)656-8920 Email: lbird@foxrothschild.com INTELLINETICS INC: GBQ Partners Raises Going Concern Doubt ---------------------------------------------------------- Intellinetics, Inc., said in its Form 10-Q report filed with the Securities and Exchange Commission for the quarterly period ended March 31, 2016, that the Company posted a net loss of $535,765 for the quarter compared to a net loss of $208,857 for the same quarter in 2015. Revenues total $603,391 for the present quarter, compared to $583,775 for the same period last year. At March 31, 2016, the Company had total assets of $1,381,797 against total liabilities of $2,736,512 and total stockholders' deficit of $1,354,715. The Company noted in its quarterly report that through March 31, 2016, it has incurred an accumulated deficit since inception of $13,914,204. At March 31, 2016, the Company had a cash balance of $1,004,441. From the Company's inception, it has generated revenues from the sales and implementation of its internally generated software applications. The Company's plan is to increase its sales and market share by developing an expanded network of resellers through which the Company will sell its expanded software product portfolio. The Company expects that this marketing initiative will require that it hire and develop an expanded sales force and enhance its product marketing efforts, all of which will require additional capital. The Company expects that through the next 12 months, the capital requirements to fund the Company's growth and to cover the operating costs as a public company will consume substantially all of the cash flows that it intends to generate from its operations, in addition to proceeds of any issuances of debt and equity securities, if consummated. The Company further believes that during this period, while the Company is focusing on the growth and expansion of its business, the gross profit that it expects to generate from operations will not generate sufficient funds to cover these anticipated operating costs. "Our cash requirements are insufficient by approximately $70,000 per month," the Company said. "During 2015 and the three months ending March 31, 2016, the Company has used the proceeds from convertible note issuances and the sale of common stock to sustain operations and to follow through on the execution of its business plan. We expect that through the next [12] months, the capital requirements to fund our growth, service existing debt obligations, and cover the operating costs as a public company will consume substantially all of the cash flows that we currently generate from operations. There is no assurance that the Company's plans as discussed above will materialize and/or that the Company will have sufficient funds to fund the Company's operations. Given these conditions, the Company's ability to continue as a going concern is contingent upon successfully managing its cash requirements. In addition, the Company's ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrants into established markets, the competitive environment in which the Company operates and its cash requirements. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern." "Since inception, the Company's operations have primarily been funded through a combination of operating margins, state business development loans, bank loans, convertible loans and loans from friends and family, and the sale of securities. Although management believes that the Company has access to capital resources, there are currently no commitments in place for new financing at this time other than the issuance of convertible notes disclosed in these financial statements and there is no assurance that the Company will be able to obtain funds on commercially acceptable terms, if at all. "During the three months ended March 31, 2016, the Company raised $ 559,285 through the sale of common stock and warrants. The proceeds from the sale were used to fund the Company's working capital needs and debt repayment. "The current level of cash and operating margins may not be enough to cover the existing fixed and variable obligations of the Company, so increased revenue performance and the addition of capital are critical to the Company's success." A copy of the Company's Quarterly report is available at https://is.gd/r4rrJ3 The Company has reported a net loss of $3,921,428 for the year ended December 31, 2015, from a net loss of $1,648,641 for 2014. Revenues total $2,336,991 for 2015 and $1,485,873 for 2014. GBQ Partners LLC in Columbus, Ohio, audited the Company's 2015 annual report and said the Company has recurring losses and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. A copy of the Company's 2015 Annual report is available at https://is.gd/dS0YCc Intellinetics, Inc., formerly known as GlobalWise Investments, Inc., is an enterprise content management (ECM) software development, sales and marketing company serving both the public and private sectors. In the public sector, the Company's products, services and process models serve, principally, the critical needs of law enforcement and compliance agencies within the state and local government establishment. The Company provides its software solutions principally through (i) the direct licensing of its software installed on customer computer platforms and (ii) providing the applications as a service, accessible through the internet. The Company's comprehensive solutions include services that range from pre-installation assessment, project scoping, implementation, consulting and ongoing software maintenance and customer support. IRON MOUNTAIN: Moody's Affirms Ba3 CFR & Rates New $500MM Notes Ba3 ------------------------------------------------------------------- Moody's Investors Service affirmed Iron Mountain Incorporated's Ba3 Corporate Family Rating and assigned Ba3 ratings to $500 million of senior notes being issued by Iron Mountain and $250 million of senior notes being issued by its indirect subsidiary, Iron Mountain US Holdings, Inc. Moody's also affirmed the Ba3 rating on Iron Mountain and its subsidiaries' existing senior unsecured notes, the B2 rating on its senior subordinated notes and its SGL-3 speculative grade liquidity rating. The ratings have a stable outlook. The company plans to use net proceeds from the new notes, incremental borrowings under its revolving credit facility and cash on hand to refinance all outstanding borrowings under the bridge credit facility that were used to finance the acquisition of Recall. RATINGS RATIONALE Iron Mountain's CFR is weakly positioned in the Ba3 rating category because of the company's elevated leverage of about 5.7x (Moody's adjusted, at 1Q 2016), execution risk in integrating the Recall acquisition and projected free cash flow deficits over the next 2 to 3 years. The Ba3 CFR incorporates our expectations that management is committed to reducing leverage toward its target of below 5x. Moody's expects that modest organic growth, synergies from the Recall acquisition and cost savings implemented under Iron Mountain's business transformation initiatives will gradually drive leverage to below 5x over the next 2 to 3 years. The Ba3 CFR is supported by Iron Mountain's leading market position in the North America storage and information management market, its large base of recurring storage rental revenues, and its expanded footprint and scale with the acquisition of Recall. Iron Mountain has a diversified customer base and its strong brand and market share in North America create pricing power that support its strong EBITDA margins. At the same time, the company faces mature demand for its services in developed markets in North America and Western Europe. Moody's also expects the company's free cash flow to remain negative over the next 2 to 3 years due to its elevated capital requirements to support growth and sizeable dividends. The stable outlook reflects Moody's expectations for low single digit organic revenue growth and progressive declines in leverage. Moody's could downgrade Iron Mountain's ratings if deterioration in earnings or changes in financial policy lead Moody's to believe that total debt to EBITDA (Moody's adjusted) is unlikely to be reduced and sustained below 5x. The rating could also be lowered if Iron Mountain's liquidity weakens materially. Although not expected in the near term, Moody's could upgrade Iron Mountain's ratings if the company maintains stable organic revenue growth and EBITDA margins, and sustains total debt to EBITDA (Moody's adjusted) below 4.5 times (Moody's adjusted) and retained cash flow to net debt above 10%. Assignments: Issuer: Iron Mountain Incorporated Senior Unsecured Regular Bond/Debenture (Local Currency), Assigned Ba3 (LGD3) Issuer: Iron Mountain US Holdings, Inc. Senior Unsecured Regular Bond/Debenture (Local Currency), Assigned Ba3 (LGD3) Affirmations: Issuer: Iron Mountain Incorporated Corporate Family Rating, Affirmed Ba3 Probability of Default Rating, Affirmed Ba3-PD Speculative Grade Liquidity Rating, Affirmed SGL-3 Senior Subordinated Regular Bond/Debenture (Local Currency), Affirmed B2 (LGD6) Senior Unsecured Regular Bond/Debenture (Local Currency), Affirmed Ba3 (LGD3) Senior Unsecured Shelf due 2016, Affirmed (P)Ba3 Issuer: Iron Mountain Canada Operations ULC Senior Unsecured Regular Bond/Debenture (Local Currency), Affirmed Ba3 (LGD3) Senior Unsecured Shelf due 2016, Affirmed (P)Ba3 Issuer: Iron Mountain Europe PLC Senior Unsecured Regular Bond/Debenture (Local Currency), Affirmed Ba3 (LGD3) Issuer: Iron Mountain Information Management, LLC Senior Secured Bank Credit Facility (Local Currency), Affirmed Ba3 (LGD3) Senior Secured Bank Credit Facility (Foreign Currency), Affirmed Ba3 (LGD3) Outlook Actions: Issuer: Iron Mountain Canada Operations ULC Outlook, Remains Stable Issuer: Iron Mountain Europe PLC Outlook, Remains Stable Issuer: Iron Mountain Incorporated Outlook, Remains Stable Issuer: Iron Mountain Information Management, LLC Outlook, Remains Stable Issuer: Iron Mountain US Holdings, Inc. Outlook, Assigned Stable Iron Mountain is a global provider of information storage and related services. The principal methodology used in these ratings was Business and Consumer Service Industry published in December 2014. JACK COOPER: Moody's Cuts Corporate Family Rating to Caa2 --------------------------------------------------------- Moody's Investors Service downgraded the ratings of Jack Cooper Enterprises, Inc. ("Jack Cooper"), including its Corporate Family Rating to Caa2 from Caa1 and its Probability of Default Rating to Caa2-PD from Caa1-PD. Concurrently, Moody's downgraded the ratings of the $375 million senior secured notes due 2020 (issued by Jack Cooper Holdings Corp.) to Caa1 from B3, and the $150 million senior unsecured PIK notes due 2019 (issued by Jack Cooper Enterprises, Inc.), to Ca from Caa3. Moody's assigned a Speculative Grade Liquidity rating of SGL-4. The ratings outlook is stable. Downgrades: -- Issuer: Jack Cooper Enterprises, Inc. -- Probability of Default Rating, Downgraded to Caa2-PD from Caa1-PD -- Corporate Family Rating, Downgraded to Caa2 from Caa1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Ca (LGD6) from Caa3 (LGD6) Assignments: -- Issuer: Jack Cooper Enterprises, Inc. -- Speculative Grade Liquidity Rating, Assigned SGL-4 -- Issuer: Jack Cooper Holdings Corp. -- Senior Secured Regular Bond/Debenture, Downgraded to Caa1 (LGD3) from B3 (LGD3) Outlook Actions: -- Issuer: Jack Cooper Enterprises, Inc. -- Outlook, Remains Stable -- Issuer: Jack Cooper Holdings Corp. -- Outlook, Remains Stable RATINGS RATIONALE The rating action is driven by lower than expected operating performance, despite progress in addressing the company's operational challenges, leading to very high leverage and a weak liquidity position. Moody's estimates the company will likely need to draw on its revolver to cover its upcoming interest payment of about $20 million, due to insufficient cash on hand of $5 million and negative free cash flow. The downgrade also reflects Moody's expectation that liquidity and credit metrics will remain weak over the next year (even with planned cost efficiencies), amidst a softening demand environment for automobiles and light trucks through 2017. The company's credit profile is characterized by: i) negative cash flow generation (despite a return to positive margins since Q2 2015) stemming in part from operational challenges in recent years; ii) elevated debt levels following the debt-funded asset acquisition of Allied and a dividend recapitalization; and iii) a dependence on revolver borrowings to fund normal-course liquidity requirements. At the same time, the CFR and stable outlook reflect the company's favorable position in the auto carrier market, blue-chip customer base, and additional opportunities identified for cost reduction and operational improvement. The company's operational inefficiencies related to such challenges as re-routing its substantially increased network following the asset acquisition of Allied in Q4 2013, delays in new vehicle releases by car manufacturers due to vehicle recalls for safety-related problems and consulting costs associated with new software to improve logistical planning. The company has taken initiatives to address the inefficiencies, including the exiting of unprofitable routes and closure of underperforming terminals. Despite expected margin improvements, Moody's anticipates interest coverage below 1 times and leverage (debt-to-EBITDA) above 10 times over the next 12 to 18 months, which includes Moody's debt adjustment for multi-employer pension plans of approximately $430 million. Moody's characterizes Jack Cooper's liquidity profile as weak, reflected by the SGL-4 rating. Cash balances typically represent less than 1% of sales and free cash flow has been negative for several years. Moody's expects that the company will need to draw on its revolver in the near-term, but could turn free cash flow positive in 2017 if it achieves the planned operational improvements. Moody's believes the company will maintain the minimum 12.5% of revolver availability necessary to avoid triggering the springing fixed charge covenant test of 1.1x. If tested currently, the company would have very limited covenant cushion. The Caa1 rating for the senior secured notes is one notch higher than the Caa2 CFR, which reflects the senior position of these securities in Moody's Loss Given Default (`LGD') analysis and the substantial amount of unsecured debt in the liability structure, comprised predominantly of the underfunded multi-employer pension plan obligations and $150 million (face amount) senior PIK toggle notes. The senior PIK toggle notes are structurally subordinated to all other obligations in the LGD analysis, substantially reducing their recovery rate as reflected in the Ca rating. The stable rating outlook is predicated on continuing demand from Jack Cooper's customer base, supported by moderate growth new car sales into 2017, as well as the potential for additional revenues through transport of non-auto based products (enabled by a recently approved law) on rig backhaul miles, the majority of which have been empty on average. The outlook also anticipates that Jack Cooper is able to increase its operating margins by successfully addressing its current operational challenges and achieving cost efficiencies. The ratings could be downgraded if the company is not able to demonstrate sufficient margin enhancement, which is critical to generate meaningful free cash flow to de-lever the balance sheet from currently heightened levels. The ratings could also be lowered if free cash flow is adversely affected by weakening demand for new automobiles and light trucks. Downward rating pressure would also mount if default were to seem more than likely or if the prospect for recovery, in event of default, were to worsen. An upgrade of the ratings could be considered if Jack Cooper demonstrates the ability to generate consistently free cash flow that is deployed to reducing leverage and/or reduces its reliance on revolver borrowings for normal course operations. As the company has limited flexibility to reduce the balance of the outstanding notes and in view of its relatively limited free cash flow capacity, Moody's foresees little upwards rating pressure in the near term. Jack Cooper Enterprises, Inc. is the direct parent of Jack Cooper Holdings Corp., headquartered in Kansas City, MO, a leading provider of over-the-road transportation of automobiles, SUVs and light trucks in the U.S. and Canada. Revenues were $746 million for the last twelve months ended March 31, 2016. JD POWER: Moody's Assigns B2 CFR & Rates 1st Lien Debt B1 --------------------------------------------------------- Moody's Investors Service assigned J.D. Power and Associates a B2 Corporate Family Rating and a B2-PD Probability of Default rating, while assigning a B1 to the proposed senior secured first lien credit facility and a Caa1 to the proposed senior secured second lien credit facility. The ratings outlook is stable. The proceeds of the rated debt, cash from the balance sheet and equity from affiliates of XIO Group, will be used to fund the $1.1 billion acquisition of J.D. Power by XIO and pay transaction and financing related fees and expenses. Issuer: J.D. Power and Associates Assignments: Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Senior Secured First Lien Term Loan due 2023, Assigned B1 (LGD3) Senior Secured First Lien Revolving Credit Facility due 2021, Assigned B1 (LGD3) Senior Secured Second Lien Term Loan due 2024, Assigned Caa1 (LGD6) Outlook: Outlook, Stable RATINGS RATIONALE J.D.Power's B2 CFR reflects high financial leverage Moody's anticipates will remain above 5.5 times and expectations for moderate 3% to 5% revenue growth balanced by solid free cash flow to debt around 5%. Small revenue scale, a limited operating scope and concentrated customer base pressure the ratings. J.D. Power provides, proprietary new and used car data, analytics and research which are important to its customers, including the largest automotive original equipment manufacturers. Revenues are contracted, recurring and visible. J.D. Power has a solid reputation for benchmarking consumer opinions as the creators of the initial quality survey for new cars. The value of the J.D. Power brand name is evidenced by about $30 million of very highly profitable brand name licensing revenue. A short operating history as an independent company and the limitations of its carve out audited financial statements create uncertainty regarding the stand-alone cost structure and cash flow profile, limiting ratings upside in the near term. The risk of aggressive financial policies by the private financial sponsor owner also weighs on the ratings. Moody's considers liquidity to be good and is supported by expectations for at least $25 million of free cash flow and a fully available $35 million revolving credit facility. All financial metrics cited reflect Moody's standard adjustments. The stable outlook reflects Moody's expectations for continued customer growth and regular price increases to lead 3% to 5% revenue growth, EBITA margins of at least 20% and free cash flow to debt around 5%. The ratings could be upgraded if Moody's expects J.D. Power will maintain 1) debt to EBITDA below 4.5 times; 2) EBITA to interest expense around 3 times; and 3) balanced financial policies. The ratings could be downgraded if Moody's anticipates 1) debt to EBITDA sustained above 6.0 times; 2) EBITA to interest expense below 1.5 times 3) free cash flow to debt below 2%; 4) diminished liquidity; or 5) more aggressive financial policies. The principal methodology used in these ratings was Business and Consumer Service Industry published in December 2014. J.D. Power, based in Costa Mesa, CA, is a global consumer intelligence and data and analytics company focused in the automotive and other industries being acquired by affiliates of XIO. Moody's expects J.D. Power to generate revenue of about $350 million in 2016. JOHN PAUL SMITH: Court Reverses Dismissal of Foreclosure Suit ------------------------------------------------------------- The Court of Appeals of North Carolina reversed the decision of the Superior Court and remanded the case captioned IN THE MATTER OF THE FORECLOSURE OF A DEED OF TRUST EXECUTED BY JOHN PAUL SMITH DATED NOVEMBER 10, 2007 AND RECORDED IN BOOK RB 913 AT PAGE 432 IN THE COLUMBUS COUNTY PUBLIC REGISTRY, NORTH CAROLINA, No. COA15-195, because the amended plan was not in fact confirmed in the case. Petitioner Wells Fargo Bank appeals the superior court's order dismissing this foreclosure action brought against respondent John Paul Smith. On appeal, petitioner contends that the superior court erred when it found that the trustee had no right to foreclose on the deed of trust and dismissed the foreclosure action based on the erroneous conclusion that petitioner's lien was void, having been extinguished by confirmation of respondent's amended bankruptcy plan. All of respondent's arguments in support of the superior court's order assume that respondent's amended plan of reorganization was confirmed. The bankruptcy court has expressly determined that respondent's amended plan was not confirmed and the United States District Court has affirmed. A full-text copy of the Decision dated May 10, 2016 is available at https://is.gd/1hCAb9 from Leagle.com. Womble Carlyle Sandridge & Rice, LLP, by B. Chad Ewing, Esq. -- cewing@wcsr.com and Amanda G. Ray, Esq. -- aray@wcsr.com for petitioner-appellant. The Law Offices of Oliver & Cheek, PLLC, by Ciara L. Rogers, Esq., George Mason Oliver, Esq., and Clayton W. Cheek, Esq. for respondent-appellee. K.M. VILLAS: Hires Songer as Forensic Expert -------------------------------------------- K.M. Villas LLC, seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to employ Mark Songer as forensic expert to the Debtor, nunc pro tunc to May 9, 2016. K.M. Villas requires Songer to examine the original note held by HSBC Bank, and report Songer's findings to the Bankruptcy Court. Songer will be paid at these hourly rates: Mark Songer $425 Personnel $205 - $375 Songer will be paid a retainer of $5,000, of which $2,750 is non-refundable. Songer will also be reimbursed for reasonable out-of-pocket expenses incurred. Mark Songer, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Songer can be reached at: Mark Songer ROBSON FORENSIC, INC. 720 S Colorado Blvd, Suit 650-N Denver, CO 80246 Tel: (303) 388-0372 Fax: (303) 374-2444 About K.M. Villas K.M. Villas LLC, based in Miami, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 15-14807) on March 16, 2015. Judge Robert A Mark presides over the case. The Debtor listed $1.3 million in assets and $2.76 million in liabilities. The petition was signed by Kevin Hinds, member. KEMET CORP: Incurs $53.6 Million Net Loss in 2015 ------------------------------------------------- KEMET Corporation filed with the Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $53.6 million on $735 million of net sales for the fiscal year ended March 31, 2016, compared to a net loss of $14.1 million on $823 million of net sales for the fiscal year ended March 31, 2015. As of March 31, 2016, Kemet Corp had $703 million in total assets, $590 million in total liabilities and $112 million in total stockholders' equity. A full-text copy of the Form 10-K is available for free at: https://is.gd/jjYD1o William M. Lowe, Jr., executive vice president and chief financial pfficer of KEMET Corporation, will provide certain investor information, including investor presentations commenced on Thursday May 26, 2016, in Hollywood, California at 9:30 a.m. pacific daylight time. The slide package prepared by the Company for use in connection with these presentations can be accessed for free at https://is.gd/g3y0Ps About KEMET KEMET, based in Greenville, South Carolina, is a manufacturer and supplier of passive electronic components, specializing in tantalum, multilayer ceramic, film, solid aluminum, electrolytic, and paper capacitors. KEMET's common stock is listed on the NYSE under the symbol "KEM." * * * As reported by the TCR on March 26, 2013, Moody's Investors Service downgraded KEMET Corp.'s Corporate Family Rating to 'Caa1' from 'B2' and the Probability of Default Rating to 'Caa1-PD' from 'B2- PD' based on Moody's expectation that KEMET's liquidity will be pressured by maturing liabilities and negative free cash flow due to the interest burden and continued operating losses at the Film and Electrolytic segment. As reported by the TCR on Aug. 9, 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on KEMET to 'B-' from 'B+'. "The downgrade is based on continued top-line and margin pressures and lagging results from the restructuring of the Film & Electrolytic [F&E] business, which combined with cyclical weak end-market demand, has resulted in sustained, elevated leverage well in excess of 5x, persistent negative FOCF, and diminishing liquidity," said Standard & Poor's credit analyst Alfred Bonfantini. The TCR reported in August 2014 that S&P revised its outlook on KEMET to 'stable' from 'negative'. S&P affirmed the ratings, including the 'B-' corporate credit rating. KOBE RESTAURANT: U.S. Trustee Unable to Appoint Committee --------------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Kobe Restaurant Group LLC. Kobe Restaurant Group LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Fla. Case No. 16-50103) on April 4, 2016. The Debtor is represented by Robert C. Bruner, Esq. KRONOS WORLDWIDE: Moody's Lowers CFR to B1, Outlook Negative ------------------------------------------------------------ Moody's Investors Service downgraded the Corporate Family Ratings and the Probability of Default ratings of Kronos Worldwide, Inc. to B1 from Ba3 and B1-PD from Ba3-PD, respectively. Other ratings downgraded at this time include the Senior Secured Term Loan of Kronos to B2 from B1. The Speculative Grade Liquidity Rating of Kronos is unchanged at SGL-3. The outlook on the ratings is negative. These actions conclude the review begun on Jan. 27, 2016. "The trendline in TiO2 prices this year will determine if Kronos' ratings stabilize at the B1 level, or warrant a further downgrade later this year if prices and metrics fail to sufficiently recover," according to Joseph Princiotta, VP -- Senior Credit Officer at Moody's. Issuer: Kronos Worldwide, Inc Probability of Default Rating, Downgraded to B1-PD from Ba3-PD Corporate Family Rating, Downgraded to B1 from Ba3 Senior Secured Bank Credit Facility (Term Loan), Downgraded to B2 (LGD5) from B1 (LGD5) Outlook, Changed To Negative from Rating Under Review Speculative Grade Liquidity Rating, Unchanged SGL-3 RATINGS RATIONALE The downgrade reflects the extent to which Kronos metrics have come under pressure due to the cyclical weakness in the TiO2 pigment markets, while at the same time Moody's recognizes the industry-wide price increases proposed and the strong possibility that a portion of the proposed price increase will be realized for the first time in a while and begin to have a meaningful positive impact on second quarter results. Beyond that, further upside to prices might be possible as the industry has proposed additional rounds of price hikes. However, given the still unfavorable balance of global supply and demand, Moody's believes the outlook for TiO2 prices in the latter part of this year remains uncertain and there's still a reasonable risk that beyond the current seasonally strong first half any recovery in prices could still reverse towards year end. Assuming only a modest increase in realized prices this year, Moody's estimates that Kronos' free cash flow is likely to be slightly negative and cash balances will trend lower in 2016, assuming only modest help from working capital and continuation of dividend payments. Moody's recognizes that free cash flow would be positive if TiO2 price increases continue to recover and achieve all or nearly all of the industry's first proposed hike of $150 per ton, or if only a portion of this amount is achieved and the company decides to reduce its dividend. Historically, a modest debt level ($337.5 million term loan as of March 31, 2016,) and management's maintenance of a relatively conservative financial philosophy have supported the Ba3 profile, particularly over the last few years when prices and margins were no worse than moderate. But the severe and surprising drop in TiO2 prices through 2015 has diminished cash flow and EBITDA, resulting in elevated leverage and cash flow coverage for the Ba3 category. Kronos' adjusted leverage (Debt/EBITDA) increased to 10.4x as of March 31, 2016, from 6.5x at year end 2015, but is expected to trend favorably as price increases begin to take hold. Assuming only a portion of the first price proposal is realized, Moody's estimates adjusted leverage would trend towards 6.0x by year end 2016. Moody's standard analytical adjustments add $245 million to debt to adjust for unfunded pension liabilities and operating leases. Kronos' credit profile benefits from modest strength as a producer of both chloride and sulfate TiO2 pigment, good customer and end-market diversity, geographic diversity, and back integration into its own ilmenite mine in Norway, which supplies 100% of the company's sulfate process raw material needs, while about one third of ilmenite mined is sold to third parties. Recent weakness in the Norwegian Krone against the US Dollar has improved profitability at this mine, albeit the benefit has been masked recently due to the weakness in pigment markets. The firm also benefits from geographic diversity with plants in North America and Europe (although the majority of its production capacity is in Europe), and operational diversity (six pigment plants and one ore mine). Kronos' market share (approximately 8% of global sales volumes) is a modest positive for the business profile, while the company's scale (roughly $1.3 billion in revenues and $0.5 billion of net PP&E as of March 31, 2016) limits the rating. The rating also reflects the company's product concentration (mostly TiO2 pigments), and the highly cyclical commodity nature of the TiO2 pigment industry. Despite the fact that the end markets for TiO2 are only moderately cyclical (e.g., paints, plastics and paper), the industry has a history of severe swings in prices and profits. The Speculative Grade Liquidity rating of SGL-3 reflects an adequate liquidity position supported by cash balances ($56 million as of March 31, 2016,) and availability under its two revolving credit facilities, which include a $125 million ABL revolver that supports its North American operations and a EUR120 million revolver that supports its European operations. The $125 million North American revolver due June 2017 is subject to a borrowing base and had $9 million outstanding and $79 million availability as of March 31, 2016. The facility has no maintenance covenants, but the fixed charge coverage ratio must be at least 1:1 to draw the last 10%. The EUR120 million European revolver due September 2017 was undrawn as of March 31, 2016. This facility has no maintenance covenants, but availability is currently limited to 6% or EUR7 million due to a net debt to EBITDA test; availability under this facility is expected to rise as EBITDA increases. The senior secured term loan B due 2020 has no maintenance financial covenants. The negative outlook reflects the risk that TiO2 prices might not rise sufficiently to restore credit metrics and cash flow, or that prices might decline again in the latter part of the year, although this is not Moody's base case expectation. An upgrade is not within the realm of possibilities at this time. However, Moody's would consider an upgrade if leverage falls below 2.5x and retained cash flow to debt of 20%, on a sustained basis. Moody's would consider a downgrade if price increases stall or are insufficient to bolster metrics and free cash flow, which could also be aggravated if management fails to diminish the dividend in a timely fashion and allow cash balances to deplete under the scenario where industry conditions and prices surprise to the downside. Structural Considerations -- The senior secured term loan B due 2020 is rated one notch below the Kronos CFR, as a result of being structurally subordinated to the revolver debt at its European subsidiaries and its non-debt obligations at its subsidiaries. Additionally, the senior secured term loan B has a second priority claim on certain US assets after the ABL credit facility. Kronos' operating assets are outside the US or, in the case of one plant, part of a joint venture in the US. As a result, the collateral coverage for the senior secured term loan B is low. The principal methodology used in these ratings was Global Chemical Industry Rating Methodology published in December 2013. Kronos Worldwide, Inc., headquartered in Dallas, TX, is a producer of titanium dioxide (TiO2) pigments and is the fourth largest producer of TiO2 in the world. As of March 31, 2016, Valhi, Inc. (NYSE: VHI) directly held approximately 50% of KRO's outstanding common stock and NL Industries, Inc. (NYSE: NL, 83% owned by VHI), held an additional 30% of KRO's common stock. Approximately 93% of Valhi's stock is held by Contran Corporation. Kronos operates six plants (four in Europe operated under Kronos International, Inc. (KII), one in the U.S., one in Canada) and reported revenues of $1.3 billion for the twelve months ended March 31, 2016. LA CASA DEL MAESTRO: Hires Juan C. Vazquez Hernandez as Accountant ------------------------------------------------------------------ La Casa Del Maestro y El Estudiante, Inc., seeks permission from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Juan C. Vazquez Hernandez, CPA, as accountant. Mr. Hernandez will provide general accounting, taxes and overall financial consulting services in connection with the bankruptcy case. He will provide these services: a. reconciliation of financial information to assist the Debtor in preparation of monthly operating reports; b. assist in the reconciliation and clarification of proof of claims filed and amounts due to creditors; c. assist the Debtor and its counsel in the preparation of the supporting documents for the Chapter 11 reorganization plan. Mr. Hernandez will be paid $200 monthly. Mr. Hernandez assures the Court that he is disinterested person as defined in 11 U.S.C. Section 101(14). Mr. Hernandez can be reached at: Juan C. Vazquez Hernandez, CPA HC-67 Box 13158 Bayamon, PR 00956 Tel: (787) 294-0633 Fax: (787) 294-0635 E-mail: cpajuancvazquez@gmail.com The Debtor's counsel can be reached at: Mercado & Conaway Law Office Wigberto Mercado, Esq. Carmen L. Conaway Mediavilla, Esq. P.O. Box 9020281 San Juan, PR 00902-0281 Tel: (787) 269-8844 E-mail: lcdowmercado@yahoo.com La Casa Del Maestro Y El Estudiante, Inc., filed for Chapter 11 bankruptcy protection (Bankr. D.P.R. Case No. 16-01241) on Feb. 22, 2016. Wigberto Mercado Barbosa, Esq., at Mercado & Conaway Law Office serves as the Debtor's bankruptcy counsel. LA ESTRELLA: Wants Time to Confirm Plan Extended by 90 Days ----------------------------------------------------------- La Estrella Fast Food, Inc., asks the U.S. Bankruptcy Court for the District of Puerto Rico to extend by 90 days the time to obtain confirmation of its plan of reorganization. The Debtor's exclusivity period ends on May 30, 2016, but the Debtor has not been able to confirm a plan because of the contested issues pending between biggest creditor in this case and the Debtor. On Aug. 14, 2015, the Debtor filed its proposed plan of reorganization. The Debtor filed its Amended Plan of Reorganization on Aug. 31, 2015. The Court entered an order to scheduled the confirmation hearing for Oct. 7, 2015, at 9:00 a.m. The Debtor sought relief under Chapter 11 because of the possible cancellation of lease contract and imminent eviction by Caribbean Restaurant, Inc, due to the assertion that debtor was in arrears with his lease contract. The truth of the matter is that he contested the validity of an electrical substation in the amount of $60,000 not contemplated in the original remodeling contract in the amount of $308,000. On Oct. 2, 2015, creditor Caribbean Restaurants, LLC, filed an objection to the confirmation of Debtor's Amended Plan. On Jan. 14, 2016, creditor Caribbean Restaurants, LLC, also filed a motion to lift the automatic stay if the pre-petition arrears were not cured within 30 days. Caribbean Restaurant asserts that debtor is in arrears with the lease agreement. The Debtor has provided the evidence of being current because of an excess payment over the last two years of CAM charges. According to the Debtor, creditor Caribbean Restaurant failed to disclose their true intentions from the beginning of the case. As one can see from the history of the case, a lot of time was wasted because creditor had made representations that they are willing to negotiate the prepetition arrears and that they wanted La Estrella to continue operating Business as usual. The Debtor assures the Court that the Plan is confirmable, because it has the necessary base to pay all creditors, now that the debtor will pay the prepetition arrears outside the plan more money will be available for the Plan. The Debtor is seeking a modification with Banco de Desarrollo to increase its cash flow and has already met with them. La Estrella Fast Food, Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. P.R. Case No. 15-02687) on April 10, 2015. The Debtor is represented by: María Soledad Lozada Figueroa LOZADA LAW & ASSOCIATES P.O. Box 9023888 San Juan, P.R. 00902-3888 Tel: (787) 200-0673 Cel: (787) 533-1400 E-mail: msl@lozadalaw.com LEGACY BENEFITS: Moody's Lowers Rating on Cl. B Notes to B1 ----------------------------------------------------------- Moody's Investors Service has downgraded the Class A Notes and the Class B Notes issued by Legacy Benefits Life Insurance Settlements 2004-1 LLC. The underlying collateral consists of a pool of universal life insurance policies and annuity contracts purchased on the lives of the insured individuals. Amounts received under the fixed payment annuity contracts are designated to cover the future premium payments on the corresponding insurance policies, as well as the interest and principal on the notes. The complete rating actions are: Issuer: Legacy Benefits Life Insurance Settlements 2004-1 LLC Cl. A, Downgraded to Baa1 (sf); previously on Feb. 24, 2016, A3 (sf) Placed Under Review for Possible Downgrade Cl. B, Downgraded to B1 (sf); previously on Feb. 24, 2016, Downgraded to Ba2 (sf) and Placed Under Review for Possible Downgrade RATINGS RATIONALE The rating actions are driven by the risk of potential insurance policy lapses and also subordination in the case of the Class B Notes. Policy lapses occur when the account value for a policy depletes completely, and there are no funds remaining to apply to the cost of insurance. The annuities may not be able to keep up with the rise in the cost of insurance of the corresponding insurance policies, thus depleting the account values. In addition, there is risk of policy lapses as the insured individuals age and approach their policies' corresponding maturity dates, if any. Moody's anticipates that some policies might be at risk of lapsing over the next few years assuming a continued rising cost of insurance and the potential for continued decreased mortality rates. There have been five policy lapses so far in a pool of 39 policies as of closing. The current pool consists of 21 policies with a total of $43.2 million face amount. The credit enhancement for the Class A and Class B Notes from subordination and overcollateralization (total face amount of the outstanding policies minus the total outstanding principal balance) is 29.0% and 9.3% respectively as of May 2016 payment date. The levels of credit enhancement for the Notes could fall, assuming a continued rising cost of insurance and low mortality among the insureds. The Class A Notes benefit from seniority in the capital structure, as Class A interest is paid before Class B interest, and principal payments to Class B shall begin only when Class A is completely paid off. Factors that would lead to an upgrade or downgrade of the ratings: Change in mortality or lapse risk as well as change in the insurance financial strength ratings of the life insurance companies and annuity providers. The principal methodology used in these ratings was "Moody's Approach to Monitoring Life Insurance ABS" published in January 2015. LEUCADIA NATIONAL: Moody's Affirms Ba1 CFR, Outlook Stable ---------------------------------------------------------- Moody's Investors Service affirmed Leucadia National Corporation's Ba1 Corporate Family Rating, Ba1-PD Probability of Default Rating, Ba2 senior unsecured debt instrument ratings, and the SGL-3 Speculative Grade Liquidity rating. The stable ratings outlook remain unchanged. Issuer: Leucadia National Corporation: Ratings Affirmed: Corporate Family Rating, Ba1; Probability of Default Rating, Ba1-PD; Senior Unsecured Shelf Rating, (P) Ba2; $750 million senior unsecured notes due 2023, Ba2 (LGD5); $250 million senior unsecured notes due 2043, Ba2 (LGD5); Speculative Grade Liquidity Rating, SGL-3. The ratings outlook is stable. RATINGS RATIONALE The affirmation of Leucadia's Ba1 CFR reflects the uplift from its investment in Jefferies (rated Baa3) and its financial policies guiding investment concentration. The rating also benefits from management's investment track record and the ongoing turnaround at National Beef, its second largest investment. Moody's expects Leucadia to prudently manage its investment portfolio while maintaining adequate liquidity at the parent holding level that is sufficient to offset the risk profile of its investments. The rating considers the company's significant leverage with projected 2016 Debt to EBITDA estimated at over 8 times on a consolidated basis and over 6 times excluding Jefferies. However, Moody's believes the leverage metrics are improving and consider in the rating that Leucadia has significant marketable securities and investments that can be liquidated. Overall Moody's considers the company to have adequate liquidity in part because of its lack of a revolver and the volatility of its cash flows as so much of its performance comes from capital appreciation of its investments. The rating also benefits from extended debt maturities. Leucadia's investments span a wide range of industries including financial services (largely through its ownership in Jefferies), meat processing (through National Beef), real estate, and other areas which it typically holds with an open time horizon. In Moody's view, the company's diversification and investment concentration policies help limit exposure to industry-specific downside scenarios. However, Moody's notes that Leucadia's more recent investments have increased its exposure to the financial services industry which could negatively impact its portfolio if a prolonged financial services downturn occurs. As Leucadia's other investments are dwarfed by the size of Jefferies, Moody's views Jefferies' Baa3 credit quality to be supportive of Leucadia's overall credit rating. Moreover, the Jefferies rating helps balance out the weaker performance of some of its other investments such as meat processor National Beef which has meaningfully underperformed expectations since its purchase but is finally on an upswing because the domestic cattle herd levels are being restocked. Notably, for the first quarter of 2016, National Beef pre-tax income was $21 million versus a pre-tax loss of $34 million. Moody's believes that Leucadia will maintain a balanced investment philosophy as it relates to the investment concentration of its portfolio. The company states through public filings its policies towards investment concentration and liquidity such that its single largest investment will not be more than 20% of equity excluding Jefferies, and that its second-largest investment will be no more than 10% of equity excluding Jefferies. Moody's believes these commitments help reduce the likelihood that large investments over a short period of time would meaningfully change the company's risk profile. However, while the company limits its investment concentration, there is still the possibility that numerous investments in financial services will perform in sync during a downturn thereby reducing the benefits of low concentration in specific investments. The stable rating outlook reflects expectations that the company will maintain adequate liquidity and manage its investment portfolio in a manner consistent with the financial policies that it has publicly disclosed including maximum investment concentrations outside of Jefferies. Positive ratings traction would be helped by an upgrade in Jefferies rating. However, an upgrade in Jefferies rating is not a precursor for an upgrade to Leucadia's rating. In order for the rating to be upgraded the company's investments and owned companies need to be stronger credits on their own. The company has historically been opportunistic and bought out of favor assets. While this strategy has been implemented well, many of its investments would historically be rated in the B rating category. An improved liquidity profile so that the company is able to support its investments in a downturn would also be a consideration of positive future credit prospects of Leucadia. Jefferies' performance and its ability to maintain its investment grade rating will remain an ongoing consideration in Leucadia's rating. If a downgrade in Jefferies Group LLC, were to occur, it would likely pressure Leucadia's ratings. Moreover, a deviation from its stated public guidance as to leverage, investment concentration, liquidity, and other factors, could adversely affect the rating depending on numerous factors including the duration of, and the reason for, the deviation. Hence, debt funded acquisitions or a significant reduction in cash and investments could pressure the rating. A significant concentration in a volatile sector or industry sub segment, such as hedge funds, could pressure the rating if the industry was considered volatile. The principal methodology used in these ratings was Investment Holding Companies and Conglomerates published in December 2015. Leucadia National Corporation, headquartered in New York, New York, is a diversified holding company engaged in a variety of businesses, including investment banking through its wholly-owned subsidiary Jefferies Group LLC, manufacturing, beef processing, oil and gas exploration and production, asset management, and other operations. The company also has significant investments in public companies and owns equity interest in operating businesses which are not publicly traded. Total shareholder's equity was over $10 billion as of March 31, 2016. LIFE PARTNERS: Schnitman Seeks Dismissal of Trustee's Claims ------------------------------------------------------------ Defendant Paul Schnitman asks the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division, to dismiss the claims made against him in the original complaint filed by Trustee H. Thomas Moran II, and entirely dismiss him from the adversary proceeding. "The Complaint asserts numerous generic allegations and claims of fraud against multiple defendants, without distinguishing among any of the defendants and without giving specific dates of alleged misconduct. Each defendant is alleged to have been a salesman (a "Licensee", a "Master Licensee" or a "Referring Licensee") for various debtor entities, Life Partners Holdings, Inc. ("Holdings"), Life Partners, Inc. ("Inc.") and Life Paltners Financial Services, Inc. ("Services")(with the debtor entities being collectively referred to herein as "Life Partners")... the Trustee makes allegations against specific licensees, possibly including Defendant, who, on behalf of Life Partners, marketed and sold interests,in life insurance policies to third-party investors... The Complaint makes various ciain1s against Defendant, all of which appear to primarily stem from allegations that Defendant, in a coordinated "scheme" with Life Partners, made misrepresentations about Life Partners' financial products, and, between 2008 and 2015, received "excessive fees and commissions" amounting to "fraudulent transfers." ...the claims asserted in the Complaint do not meet pleading standards set forth in Rule 9 and 12 of the Federal Rules of Civil Procedure," Mr. Schnitman avers. Paul Schnitman is represented by: Randy J. Hall, Esq. Kyle B. Fonville, Esq. DECKER, JONES, PC 801 Cherry Street, Suite 2000 Burnett Plaza, Unit 46 Fort Worth, TX 76102 Telephone: (817)336-2400 Facsimile: (817)332-3043 E-mail: rhall@deckerjones.com kfonville@deckerjones.com About Life Partners Holdings Headquartered in Waco, Texas, Life Partners Holdings, Inc. -- http://www.lphi.com/-- is the parent company engaged in the secondary market for life insurance, commonly called "life settlements." Since its incorporation in 1991, Life Partners, Inc. has completed over 162,000 transactions for its worldwide client base of over 30,000 high net worth individuals and institutions in connection with the purchase of over 6,500 policies totaling over $3.2 billion in face value. LPHI is a publicly traded company incorporated in Texas and its common stock has been delisted from the NASDAQ (formerly trading under the symbol LPHI). Life Partners Holdings sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 15-40289) on Jan. 20, 2015. The case is assigned to Judge Russell F. Nelms. J. Robert Forshey, Esq., at Forshey & Prostok, LLP, serves as counsel to the Debtor. LPHI disclosed $2,406,137 in assets and $52,722,308 in liabilities as of the Chapter 11 filing. The official committee of unsecured creditors formed in the case tapped Munsch Hardt Kopf & Harr, P.C., as counsel. Tracy A. Bolt of BDO USA, LLP was named as examiner for the Debtor's case. At the behest of the U.S. Securities and Exchange Commission, the U.S. Trustee, and the Creditors Committee, the Court ordered the appointment of a Chapter 11 trustee. On March 13, 2015, H. Thomas Moran II was appointed as Chapter 11 trustee in LPHI's case. The trustee is represented by Thompson & Knight LLP. The Chapter 11 trustee signed Chapter 11 bankruptcy petitions for LPHI's subsidiaries on May 19, 2015: Life Partners Inc. (Case No. 15-41995) and LPI Financial Services, Inc. (Case No. 15-41996). Life Partners is estimated to have $100 million to $500 million in assets and more than $1 billion in debt. LPI Financial estimated less than $50,000. LIME ENERGY: Gets Noncompliance Notice from NASDAQ -------------------------------------------------- Lime Energy Co. received on May 20, 2016, a notice from The NASDAQ Stock Market LLC indicating that the Company currently does not meet the continued listing requirement set forth in Listing Rule 5550(b)(1), which requires companies listed on the Nasdaq Capital Market to maintain a minimum of $2.5 million in stockholders’ equity for continued listing. The Notice indicated that the Company also does not meet Nasdaq's alternatives for market value of listed securities or net income from continuing operations. The Company has 45 days, from the date of the Notice, to submit a plan to regain compliance. The Company anticipates submitting such a plan to Nasdaq within the requisite period. If Nasdaq accepts the Company's plan, then Nasdaq may grant the Company a 180-day extension from the date of the Notice to evidence compliance. If the Company is not granted an extension or is granted an extension but is unable to evidence compliance during the extension period, Nasdaq may issue a delisting determination. The Company would then have the option to request a hearing to review the matter, which request will ordinarily suspend the delisting action until the hearing panel issues a decision. There can be no assurance that the Company will be successful in receiving a 180-day extension to regain compliance or in maintaining its listing on the Nasdaq Capital Market, which could impair the liquidity and market price of the Company's common stock. Nasdaq's determination to delist the Company's common stock could materially and adversely affect the Company's access to capital markets and its ability to raise capital on acceptable terms, if at all. About Lime Energy Headquartered in Huntersville, North Carolina, Lime Energy Co. -- http://www.lime-energy.com/-- is engaged in planning and delivering clean energy solutions that assist its clients in their energy efficiency and renewable energy goals. The Company's solutions include energy efficient lighting upgrades, energy efficient mechanical and electrical retrofit and upgrade services, water conservation, building weatherization, on-site generation and renewable energy project development and implementation. The Company provides energy solutions across a range of facilities, from high-rise office buildings, distribution facilities, manufacturing plants, retail sites, multi-tenant residential buildings, mixed use complexes, hospitals, colleges and universities, government sites to small, single tenant facilities. Lime Energy reported a net loss available to common stockholders of $4.44 million on $113 million of revenue for the year ended Dec. 31, 2015, compared to a net loss available to common stockholders of $5.60 million on $58.8 million of revenue for the year ended Dec. 31, 2014. As of March 31, 2016, Lime Energy had $47.5 million in total assets, $38.8 million in total liabilities, $11.05 million in contingently redeemable series C preferred stock and a total stockholders' deficiency of $2.27 million. LUCKY SOIL: Ch.11 Trustee to Hire Nathan Sommers as Counsel ----------------------------------------------------------- The Chapter 11 trustee of Lucky Soil Investment LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Nathan Sommers Jacobs P.C. as his general bankruptcy counsel. Ronald Sommers, the bankruptcy trustee, tapped the firm to provide these services: (a) analyze and prosecute actions regarding insider transactions and third-party dealings; (b) institute non-routine objections to proofs of claim asserted against the estate; (c) represent the trustee in any litigation filed against him; (d) analyze and prosecute actions regarding avoidance of setoffs and avoidable transfers; (e) represent the estate in any other lawsuits or adversary proceedings as necessary; (f) assist with the employment of professionals by the estate, obtain court approval to pay those professionals, and, when necessary, object to unreasonable fee applications; (g) investigate executory contract relationships of the Debtor and institute proceedings to assume or reject such contracts; (h) analyze business associations of the Debtor or debts owing to the Debtor, determine the interest of the estate, and prosecute any actions necessary to effect the recovery and liquidation of such interest or obligations; (i) prepare for and prosecute any necessary examinations; (j) provide legal advice on matters involving taxation of the estate; and (k) prepare and solicit approval for a Chapter 11 plan and disclosure statement. Jarrod Martin, Esq., at Nathan Sommers, has been designated as attorney-in-charge who will be responsible for the representation of the trustee. Mr. Martin will be paid $315 per hour. Mr. Martin disclosed in a court filing that his firm does not represent interest adverse to the Debtor's estate. Nathan Sommers can be reached through: Jarrod B. Martin Nathan Sommers Jacobs P.C. 2800 Post Oak Boulevard, 61St Floor Houston, TX 77056 Tel: (713) 960-0303 Fax: (713) 892-4800 (fax) About Lucky Soil Investment Lucky Soil Investment LLC sought protection under Chapter 11 of the Bankruptcy Code in the Southern District of Texas (Houston) (Case No. 16-31756) on April 4, 2016. The petition was signed by Cathy Nguyen, managing director. The Debtor is represented by John Robert Brown, Jr., Esq., at Gamal Dang & Associates. The Debtor estimated both assets and liabilities in the range of $1 million to $10 million. M SPACE HOLDINGS: Hires Gordon Brothers as Liquidator ----------------------------------------------------- M Space Holdings, LLC, seeks authority from the U.S. Bankruptcy Court for the District of Utah to employ Gordon Brothers Commercial & Industrial, LLC as asset liquidator to the Debtor. M Space Holdings requires Gordon Brothers to: -- assist with the sale of substantially all of the Debtor's assets; -- develop and recommend appropriate strategies for the sale of the assets, pricing and presentation of the assets, and recommendations to the Debtor regarding the acceptability of sale offers obtained; -- recommend with respect to other operational matters in connection with the implementation of a sale of substantiall all of the Debtor's assets. Gordon Brothers will be paid with a percentage fee of 1.5% of the gross proceeds received from the sale of the Debtor's assets, including without limitation any buyer's premium received thereon, plus expenses. To the best of the Debtor's knowledge the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Gordon Brothers can be reached at: Gordon Brothers Commercial & Industrial, LLC Prudential Tower 800 Boylston Street, 27th Floor Boston, MA 02199 Tel: (888) 424-1903 Fax: (617) 422-6222 About M Space Holdings M Space Holdings, LLC is a provider of turnkey complex modular space solutions. The Debtor sought protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Utah (Salt Lake City) (Case No. 16-24384) on May 19, 2016. The petition was signed by Jeffrey Deutschendorf, chief executive officer and president. The case is assigned to Judge Joel T. Marker. The Debtor's asset Liquidator is Gordon Brothers Commercial & Industrial, LLC. The Debtor estimated both assets and liabilities in the range of $50 million to $100 million. MAGNA CLEANERS: Hires John Solt as Chapter 11 Counsel ----------------------------------------------------- Magna Cleaners, Inc., seeks authority from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ John R. K. Solt, P.C. as counsel to the Debtor. Magna Cleaners requires Solt to: a. advise and assist the Debtor in the preparation of the Schedules and Statement of Affairs; b. represent the Debtor at the initial meeting with the U.S. Trustee's representative and at the meeting of creditors; c. prepare pleadings and applications and conduct examinations incidental to any related proceedings or to the administration of this case; d. examine and challenge, when necessary, the claims of creditors in this case; e. advise the Debtor of its rights, duties and obligations as Debtor in a chapter 11 bankruptcy proceeding; f. taking any and all other necessary action incident to the proper preservation and administration of this Chapter 11 case; g. advise and assist the Debtor in the formation and confirmation of a plan of reorganization pursuant to Chapter 11 of the Bankruptcy Code, and any and all matters related thereto. h. assist special counsel as may be necessary and appropriate. Solt will be paid at these hourly rates: John R.K. Solt $275 Paralegals $100 Administrative Assistants $40 Solt will be paid a retainer in the amount of $7,000. John R.K. Solt, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Solt can be reached at: John R.K. Solt, Esq. 2045 Westgate Drive, Suite 404B Bethlehem, PA 18017 Tel: 610-865-2465 Fax: 610-691-2018 Magna Cleaners, Inc. filed a Chapter 11 petition (Bankr. E.D. Pa. Case No. 4:16-bk-13645) on May 20, 2016. Judge Richard E Fehling presides over the case. MAHI LLC: Seeks to Hire Stewart Robbins as Legal Counsel -------------------------------------------------------- Mahi, LLC and OM Hospitality, LLC seek approval from the U.S. Bankruptcy Court for the Middle District of Louisiana to hire Stewart Robbins & Brown, LLC as their legal counsel. The attorneys and staff who are anticipated to assist the Debtors during their bankruptcy and their hourly rates are: Professionals Hourly Rates ------------- ------------ Ryan J. Richmond $315 P. Douelas Stewart, Jr. $360 Brandon A. Brown $350 William S. Robbins $350 Brooke Altazan $275 Staff $90 Ryan Richmond, Esq., a member of Stewart Robbins, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Stewart Robbins can be reached through: Ryan J. Richmond Brandon A. Brown Brooke Altazan Stewart Robbins & Brown, LLC 620 Florida Street, Suite 100 (70810-1747) P.O. Box 2348 Baton Rouge, LA 70821-2348 Tel: (225) 231-9998 Fax: (225) 709-9467 E-mail: rrichmond@stewartrobbins.com bbrown@stewartrobbins.com baltazan@stewartrobbins.com About Mahi LLC Mahi, LLC and OM Hospitality, LLC sought protection under Chapter 11 of the Bankruptcy Code in the Middle District of Louisiana (Baton Rouge) (Case Nos. 16-10601 and 16-10602) on May 24, 2016. The petitions were signed by Bhagirath Joshi, manager. The cases are assigned to Judge Douglas D. Dodd. A motion for joint administration of the cases is pending. The Debtors estimated both assets and liabilities in the range of $1 million to $10 million. MCK MILLENNIUM: Exclusive Plan Filing Period Extended to June 27 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois has extended, at the behest of MCK Millennium Centre Realty, LLC, the Debtor's time to file its plan and disclosure statement through and including June 27, 2016. The plan status hearing set for June 7, 2016, at 10:30 a.m. is stricken and will instead be held on July 5, 2016, at 10:30 a.m. About MCK Millennium MCK Millennium Centre Realty, LLC, filed for Chapter 11 protection (Bankr. N.D. Ill. Case No. 16-06369) on February 25, 2016. The petition was signed by by William A Marovitz, member. Hon. Jack B. Schmetterer presides over the case. The Debtor estimated assets of $10 million to $50 million and estimated debts of $0 to $50,000. MIDSTATES PETROLEUM: Seeks to Hire Evercore as Investment Banker ---------------------------------------------------------------- Midstates Petroleum Company, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Evercore Group L.L.C. as their investment banker. The Debtors tapped the firm to provide these services: (a) review and analyze the Debtors' business, operations and financial projections; (b) advise and assist the Debtors in a restructuring transaction; (c) provide financial advice in developing and implementing a restructuring, which would include: (i) assist the Debtors in developing a restructuring plan or plan of reorganization; (ii) advise the Debtors on tactics and strategies for negotiating with various stakeholders regarding the plan; (iii) provide testimony before any court exercising jurisdiction over the Debtors; and (iv) provide the Debtors with other financial restructuring advice as Evercore and the Debtors may deem appropriate. The Debtors have agreed to pay Evercore in cash under this fee structure: (a) A monthly fee of $175,000, payable on execution of their engagement agreement and on the first day of each month commencing March 1, 2016, until the earlier of the consummation of the restructuring transaction or the termination of Evercore's engagement. (b) A fee payable upon the consummation of any restructuring, equal to $6.5 million. (c) Expense reimbursement. The Debtors have also agreed to indemnify the firm and provide reimbursement to the firm under certain circumstances. Daniel Aronson, senior managing director of Evercore, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm may be reached at: Daniel Aronson EVERCORE GROUP LLC 55 East 52nd Street New York, NY 10055 Tel: 416-352-5897 E-mail: daniel.aronson@evercore.com About Midstates Petroleum Company Midstates Petroleum Company, Inc. -- http://www.midstatespetroleum.com/-- is an independent exploration and production company focused on the application of modern drilling and completion techniques in oil and liquids-rich basins in the onshore U.S. Midstates' drilling and completion efforts are currently focused in the Mississippian Lime oil play in Oklahoma and Anadarko Basin in Texas and Oklahoma. The Company's operations also include the upper Gulf Coast tertiary trend in central Louisiana. Midstates Petroleum Company, Inc. and Midstates Petroleum Company LLC filed separate Chapter 11 petitions (Bankr. S.D. Tex. Case Nos. 16-32237 and 16-32238) on April 30, 2016. Judge David R Jones presides over the case. Kurtzman Carson Consultants LLC serves as claims and noticing agent. As of Dec. 31, 2015, the Company listed assets of $679 million and total debts of $2 billion. The petitions were signed by Nelson M. Haight, executive vice president and chief financial officer. The Office of the U.S. Trustee on May 12 appointed three creditors to serve on the official committee of unsecured creditors. MIDSTATES PETROLEUM: Seeks to Hire Jackson as Conflicts Counsel --------------------------------------------------------------- Midstates Petroleum Company, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Jackson Walker LLP as their local and conflicts bankruptcy counsel. The Debtors tapped the firm to provide these services: (a) provide legal advice and services regarding local rules, practices, and procedures; (b) provide certain services in connection with the administration of the Chapter 11 cases; (c) review and comment on proposed drafts of pleadings to be filed with the court; (d) at the request of the Debtors, appear in court and at any meeting with the U.S. trustee and any meeting of creditors; (e) perform all other services assigned by the Debtors to the firm; and (f) provide legal advice and services on any matter on which the Debtors' lead bankruptcy counsel may have a conflict, or as needed based on specialization. The firm's attorneys and their hourly rates are: Patricia B. Tomasco $675 Matthew D. Cavenaugh $515 Jennifer F. Wertz $415 The hourly rates of other attorneys in the firm range from $275 to $745 while the rates of paralegals range from $175 to $215. Ms. Tomasco, Esq., a partner at Jackson Walker, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Jackson Walker can be reached through: Patricia B. Tomasco Jackson Walker LLP 1401 McKinney Street, Suite 1900 Houston, TX 77010 Phone: (713) 752-4200 Fax: (713) 752-4221 About Midstates Petroleum Company Midstates Petroleum Company, Inc. -- http://www.midstatespetroleum.com/-- is an independent exploration and production company focused on the application of modern drilling and completion techniques in oil and liquids-rich basins in the onshore U.S. Midstates' drilling and completion efforts are currently focused in the Mississippian Lime oil play in Oklahoma and Anadarko Basin in Texas and Oklahoma. The Company's operations also include the upper Gulf Coast tertiary trend in central Louisiana. Midstates Petroleum Company, Inc. and Midstates Petroleum Company LLC filed separate Chapter 11 petitions (Bankr. S.D. Tex. Case Nos. 16-32237 and 16-32238) on April 30, 2016. Judge David R Jones presides over the case. Kurtzman Carson Consultants LLC serves as claims and noticing agent. As of Dec. 31, 2015, the Company listed assets of $679 million and total debts of $2 billion. The petitions were signed by Nelson M. Haight, executive vice president and chief financial officer. The Office of the U.S. Trustee on May 12 appointed three creditors to serve on the official committee of unsecured creditors. MIDSTATES PETROLEUM: Seeks to Hire Kirkland as Lead Counsel ----------------------------------------------------------- Midstates Petroleum Company, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Kirkland & Ellis LLP and Kirkland & Ellis International LLP as their lead bankruptcy counsel. The Debtors tapped Kirkland to: (a) advise them about their powers and duties as debtors-in- Possession and about the conduct of their Chapter 11 cases; (b) attend meetings and negotiate with representatives of creditors and other parties; (c) take all necessary actions to protect and preserve the Debtors' estates, including the prosecution of actions on the Debtors' behalf; (d) prepare legal papers on behalf of the Debtors; (e) represent the Debtors in connection with obtaining authority to continue using cash collateral and post- petition financing; (f) advise the Debtors in connection with any potential sale of assets; (g) appear before the court and any appellate courts; (h) advise the Debtors regarding tax matters; (i) take any necessary action on behalf of the Debtors to negotiate, prepare and obtain approval of a disclosure statement and confirmation of a chapter 11 plan; and (j) perform all other necessary legal services, including analyzing the Debtors' leases and contracts and analyzing the validity of liens against the Debtors. The firms' hourly rates for matters related to the cases from January 13 to December 31, 2015, are: Partners $825 - $1,375 Of Counsel $665 - $1,325 Associates $480 - $890 Paraprofessionals $190 - $385 The firms' current hourly rates for matters related to the cases range from $875 to $1,445 for partners; $480 to $1,445 for "of counsel;" $510 to $945 for associates; and $180 to $400 for paraprofessionals. In compliance with the U.S. Trustee Guidelines, Edward Sassower, president of Edward O. Sassower P.C., a partner of Kirkland, disclosed in a filing that the hourly rates used by the firms in representing the Debtors are consistent with the rates that they charge other comparable Chapter 11 clients regardless of the location of the case. Mr. Sassower also said that the Debtors have already approved the firms' budget and staffing plan for the period from April 30, 2016, through approximately 120 days after the bankruptcy filing date. Mr. Sassower disclosed that the firms are "disinterested persons" as defined in section 101(14) of the Bankruptcy Code. Kirkland can be reached through: Jason Gott, Esq. Kirkland & Ellis LLP Kirkland & Ellis International LLP 300 North LaSalle Chicago, IL 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 E-mail: edward.sassower@kirkland.com joshua.sussberg@kirkland.com About Midstates Petroleum Company Midstates Petroleum Company, Inc. -- http://www.midstatespetroleum.com/-- is an independent exploration and production company focused on the application of modern drilling and completion techniques in oil and liquids-rich basins in the onshore U.S. Midstates' drilling and completion efforts are currently focused in the Mississippian Lime oil play in Oklahoma and Anadarko Basin in Texas and Oklahoma. The Company's operations also include the upper Gulf Coast tertiary trend in central Louisiana. Midstates Petroleum Company, Inc. and Midstates Petroleum Company LLC filed separate Chapter 11 petitions (Bankr. S.D. Tex. Case Nos. 16-32237 and 16-32238) on April 30, 2016. Judge David R Jones presides over the case. Kurtzman Carson Consultants LLC serves as claims and noticing agent. As of Dec. 31, 2015, the Company listed assets of $679 million and total debts of $2 billion. The petitions were signed by Nelson M. Haight, executive vice president and chief financial officer. The Office of the U.S. Trustee on May 12 appointed three creditors to serve on the official committee of unsecured creditors. MOBILESMITH INC: Comerica Loan Agreement Maturity Moved to 2018 --------------------------------------------------------------- Mobilesmith disclosed in a regulatory filing with the Securities and Exchange Commission that it entered into First Amendment to Loan and Security Agreement with Comerica Bank dated June 9, 2014. The First Amendment extends the maturity date of the outstanding loan under the 2014 Comerica LSA from June 6, 2016 to June 6, 2018. Except as so amended, all of the terms relating to the outstanding 2014 Comerica LSA remain unchanged. About MobileSmith, Inc. Raleigh, North Carolina-based MobileSmith, Inc. was incorporated as Smart Online, Inc. in 1993 and changed its name to MobileSmith, Inc. effective July 1, 2013. The company develops and markets software products and services tailored to users of mobile devices. Its flagship product, MobileSmith(R) Platform is an app development platform that enables organizations to rapidly create, deploy and manage custom, native smartphone and tablet apps deliverable across iOS and Android mobile platforms. MobileSmith reported a net loss of $7.71 million on $1.82 million of total revenue for the year ended Dec. 31, 2015, compared to a net loss of $7.33 million on $879,086 of total revenue for the year ended Dec. 31, 2014. As of March 31, 2016, MobileSmith Inc. had $1.41 million in total assets, $42.47 million in total liabilities and a total stockholders' deficit of $41.05 million. Cherry Bekaert LLP, in Raleigh, North Carolina, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company has suffered recurring losses from operations and has a working capital deficiency as of Dec. 31, 2015. These conditions, the auditors noted, raise substantial doubt about the Company's ability to continue as a going concern. MOBILESMITH INC: Stockholders Elect 3 Directors ----------------------------------------------- Mobilesmith, Inc., held its annual meeting of stockholders on May 23, 2016, at which the stockholders: (1) elected Amir Elbaz, Jon Campbell and Ronen Shviki as directors; (2) authorized the Company to amend the Company's Certificate of Incorporation to increase the authorized shares of common stock from 45 million to 100 million; (3) approved the Company's 2016 Plan; and (4) approved, in a nonbinding and advisory vote, the compensation of the Company's named executive officers. As of April 8, 2016, the record date for the 2016 Annual Meeting, there were 19,827,542 shares of common stock issued and outstanding. A quorum of common stockholders, present in person or by proxy, representing 11,985,017 shares of common stock was present at the 2016 Annual Meeting. About MobileSmith, Inc. Raleigh, North Carolina-based MobileSmith, Inc. was incorporated as Smart Online, Inc. in 1993 and changed its name to MobileSmith, Inc. effective July 1, 2013. The company develops and markets software products and services tailored to users of mobile devices. Its flagship product, MobileSmith(R) Platform is an app development platform that enables organizations to rapidly create, deploy and manage custom, native smartphone and tablet apps deliverable across iOS and Android mobile platforms. MobileSmith reported a net loss of $7.71 million on $1.82 million of total revenue for the year ended Dec. 31, 2015, compared to a net loss of $7.33 million on $879,086 of total revenue for the year ended Dec. 31, 2014. As of March 31, 2016, MobileSmith Inc. had $1.41 million in total assets, $42.47 million in total liabilities and a total stockholders' deficit of $41.05 million. Cherry Bekaert LLP, in Raleigh, North Carolina, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company has suffered recurring losses from operations and has a working capital deficiency as of Dec. 31, 2015. These conditions, the auditors noted, raise substantial doubt about the Company's ability to continue as a going concern. MODERN OFFICE SYSTEMS: Seeks to Hire Michael Marcus as Accountant ----------------------------------------------------------------- Modern Office Systems Inc. and Luis Vargas Rodriguez, the company's president, seek approval from the U.S. Bankruptcy Court for the District of Puerto Rico to hire an accountant for the estate. The Debtors proposed to hire Michael Marcus as accountant to provide these services: (a) to close out the Debtors' books as of the date of the filing of the cases and to open new books; (b) to establish a new bookkeeping system to replace the system used by the Debtors; (c) to prepare the periodic statements of the debtors-in- possession's operations; (d) to prepare and file the Debtors' state and federal tax return; (e) to prepare General Ledger and Disbursements Register; (f) to reconcile the account; (g) to prepare Interim Financial Statements for each semester and Certified Financial Statements for each state tax return to be submitted every year on or before April 14th; (h) to provide tax and management counseling; (i) to represent the Debtors in taxes investigations; (j) to prepare weekly payroll; (k) to prepare bank reconciliations; (l) to distribute income and expenses of the corporation accordingly; (m) to prepare monthly operating reports to be submitted on or before the 20th of each month. Mr. Marcus will charge $500 monthly for his services. In a court filing, Mr. Marcus disclosed that he does not have an interest materially adverse to the interest of the Debtors' estates. Mr. Marcus maintains an office at: Michael J. Marcus P.O. Box 6494 Cabo Rojo, Puerto Rico 00732 Tel: 787-265-0970 Fax: 787-834-6635 E-mail: cpamichaelm@gmail.com The Debtors can be reached through: Modesto Bigas Mendez Modesto Bigas Law Office P.O. Box 7462 Ponce, Puerto Rico 00732-7462 Tel:787-844-1444 Fax: 787-842-4090 E-mail: modestobigas@yahoo.com About Modern Office Systems Modern Office Systems Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 15-09655) on December 4, 2015. On April 29, 2016, the court granted the substantive consolidation of Modern Office Systems' case with the Chapter 11 case (Case No. 16-00812) of Luis Vargas Rodriguez, president of the company. MOSS FAMILY: BW Allowed $125K Administrative Expense Claim ---------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Indiana, South Bend Division, issued a Consent Order on the Amended Proofs of Claims 4-2 filed by B.W. Renaissance Partners, LLP ("BW") and Chapter 7 Trustee Yvette Gaff Kleven's objection thereto. Through the Consent Order, BW and the Chapter 7 Trustee agreed to resolution of matters as follows: (1) In recognition that the debtors-in-possession used BW's cash collateral in excess over the adequate protection payments that the debtor-in-possession made, and BW having filed its Section 507(b) superpriority claim in its Amended Proofs of Claims which were timely filed, BW will be allowed an administrative expense in the amount of $125,000 which is granted superpriority status, provided however that: (a) such allowed administrative expense will be payable solely from the funds obtained by the Chapter 7 Trustee resulting from the Dunetop matter; (b) that such allowed administrative expense will share equal priority with all other allowed chapter 7 administrative expenses, including Trustee compensation; and (c) that any current funds in the estate that do not relate to Dunetop will be exempt from BW's allowed administrative expense. (2) BW will also be allowed a general unsecured deficiency claim in the amount of $460,000. Ms. Kleven filed an objection to Claim Number 4, and then an amended objection to Claim Number 4-2, filed by BW as successor in interest to Fifth Third Bank, showing a priority claim in the amount of $159,529, with the balance of the claim being unsecured. She believed that BW's entire claim of $586,101 should be deemed unsecured. Yvette Gaff Kleven, Chapter 7 Trustee, is represented by: Yvette Gaff Kleven, Esq. Douglas R. Adelsperger, Esq. ADELSPERGER & KLEVEN, LLP 111 West Wayne Street Fort Wayne, IN 46802 Telephone: (260)407-7077 E-mail: ygk@adelspergerkleven.com dra@adelspergerkleven.com BW Renaissance Partners LLP is represented by: Gordon E. Gouveia, Jr. SHAW FISHMAN GLANTZ & TOWBIN LLC 321 North Clark Street, Suite 800 Chicago, IL 60654 Telephone: (312)541-0151 E-mail: ggouveia@shawfishman.com About Moss Family Moss Family Limited Partnership and Beachwalk, L.P., filed Chapter 11 petitions (Bankr. N.D. Ind. Case Nos. 12-32540 and 12-32541) on July 17, 2012. Judge Harry C. Dees, Jr., presides over the case. Daniel Freeland, Esq., at Daniel L. Freeland & Associates, P.C., represents the Debtors. The Debtors tapped Beachwalk Realty LLC as their broker to sell certain property named Lot 136B located at 102 Mary Lane in Michigan City, Indiana. Moss Family disclosed $6,609,576 in assets and $6,299,851 in liabilities as of the Chapter 11 filing. The Debtors' Amended Joint Chapter 11 Plan dated Dec. 3, 2013, provides that unsecured claims will be fully paid and satisfied by use of the proceeds from the sale of LaPorte Judgment Lien Property. MOSS FAMILY: U.S. Bank Wants Automatic Stay Relief -------------------------------------------------- U.S. Bank, National Association, asks the U.S. Bankruptcy Court for the Northern District of Indiana, South Bend Division, to lift the automatic stay and abandon from the estate of Moss Family Limited Partnership, real property located at 325 Childers Lane, Michigan City, Indiana ("Property"). U.S. Bank avers that as of the Petition Date, it was the holder of a claim secured by the Property ("Mortgage"). It further avers that the Mortgage was given to secure a promissory note in the original sum of $422,000. U.S. Bank relates that the outstanding principal of the Note was $376,100 and the outstanding interest was $41,349. It contends that it is not being adequately protected and that the Debtor has failed to make periodic payments to U.S. Bank since Sept. 1, 2012 through April 2016. U.S. Bank further contends that the Property is burdensome and/or of inconsequential value and benefit to the estate. U.S. Bank, National Association, is represented by: Sarah E. Willms, Esq. Edward H. Cahill, Esq. Adam B. Hall, Esq. John R. Cummins, Esq. MANLEY DEAS KOCHALSKI LLC P.O. Box 165028 Columbus, OH 43216-5028 Telephone: (614)220-5611 Facsimile: (614)627-8181 E-mail: sew@manleydeas.com About Moss Family Limited Partnership Moss Family Limited Partnership and Beachwalk, L.P., filed Chapter 11 petitions (Bankr. N.D. Ind. Case Nos. 12-32540 and 12-32541) on July 17, 2012. Judge Harry C. Dees, Jr., presides over the case. Daniel Freeland, Esq., at Daniel L. Freeland & Associates, P.C., represents the Debtors. The Debtors tapped Beachwalk Realty LLC as their broker to sell certain property named Lot 136B located at 102 Mary Lane in Michigan City, Indiana. Moss Family disclosed $6,609,576 in assets and $6,299,851 in liabilities as of the Chapter 11 filing. The Debtors' Amended Joint Chapter 11 Plan dated Dec. 3, 2013, provides that unsecured claims will be fully paid and satisfied by use of the proceeds from the sale of LaPorte Judgment Lien Property. MOTORS LIQUIDATION: Has $612M Assets in Liquidation at March 31 --------------------------------------------------------------- Motors Liquidation Company GUC Trust filed with the Securities and Exchange Commission its annual report on Form 10-K disclosing total assets of $667 million, total liabilities of $55.4 million and net assets in liquidation of $612 million. As of March 31, 2016, the GUC Trust had approximately $24.6 million in reserves for liquidation and administrative costs that are estimated to be incurred through the winding up and conclusion of the GUC Trust, compared to approximately $31.3 million in reserves as of March 31, 2015. The GUC Trust's sources of liquidity are principally the funds it holds for the payment of liquidation and administrative costs, and to a significantly lesser degree, the earnings on such funds invested by it. In addition, as a result of the liquidation of all the GUC Trust's holdings of New GM Securities during the quarter ended Sept. 30, 2015, the GUC Trust holds Distributable Cash for distribution to GUC Trust beneficiaries. The GUC Trust holds such funds as cash and cash equivalents and also invests such funds in marketable securities, primarily U.S. Treasury bills, as permitted by the Plan and the GUC Trust Agreement. During the year ended March 31, 2016, the GUC Trust's holdings of cash and cash equivalents decreased approximately $33.1 million from approximately $37.5 million to approximately $4.4 million. The decrease was primarily due to cash paid for liquidation and administrative costs of $13.2 million, cash paid for Residual Wind-Down Claims of $6.2 million and cash reinvested in Marketable Securities, offset in part by receipts of cash dividends on holdings of New GM Common Stock of $4.1 million. Cash distributions of approximately $130.0 million during the year ended March 31, 2016, were funded from the proceeds of the liquidation of New GM Securities of $741.7 million, with the balance of such proceeds remaining largely invested in Marketable Securities. During the year ended March 31, 2016, the funds invested by the GUC Trust in marketable securities increased approximately $630.2 million, from approximately $30.9 million to approximately $661.1 million. The increase was due primarily to the liquidation of all the GUC Trust's holdings of New GM Securities during the quarter ended Sept. 30, 2015. The GUC Trust earned approximately $0.8 million in interest income on such investments during the year. As of March 31, 2016, the GUC Trust held approximately $665.5 million in cash and cash equivalents and marketable securities. Of such amount, approximately $620.9 million relates to Distributable Cash (including Dividend Cash), a portion of which the GUC Trust Administrator is permitted to set aside from distribution and to appropriate with the approval of the Bankruptcy Court or Trust Monitor, as applicable, in order to fund additional costs and income tax liabilities (including Dividend Taxes, Investment Income Taxes and Taxes on Distribution) as they become due. Included in Distributable Cash at March 31, 2016, is approximately $17.3 million of Dividend Cash. Dividend Cash will be distributed to holders of subsequently Resolved Allowed Claims and GUC Trust Units in respect of Distributable Cash that they receive, unless such dividends are in respect of Distributable Cash that is appropriated by the GUC Trust in accordance with the GUC Trust Agreement to fund the GUC Trust's liquidation and administrative costs, income tax liabilities or shortfalls in Residual Wind-Down Assets. As of March 31, 2016, Distributable Cash (including Dividend Cash) held by the GUC Trust was set aside as follows: (a) $6.2 million for liquidating distributions payable as of that date, (b) $47.1 million to fund projected liquidation and administrative costs, including Dividend Taxes and Investment Income Taxes, and (c) $107.5 million to fund potential Taxes on Distribution. A full-text copy of the Form 10-K is availble for free at: https://is.gd/hBrOnW About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. MSC SOFTWARE: Moody's Lowers Corporate Family Rating to B3 ---------------------------------------------------------- Moody's Investors Service downgraded MSC Software Corporation's corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD. Moody's also downgraded the second lien term loan to Caa2 from Caa1 and affirmed the B1 ratings on the first lien term loan. The ratings outlook is stable. The downgrade of the corporate family rating reflects declining revenue and EBITDA since the 2014 dividend recapitalization and the resulting increase in financial leverage to about 8x. RATINGS RATIONALE The B3 corporate family rating reflects MSC's high financial leverage resulting from the May 2014 dividend recapitalization transaction, as well as revenue and EBITDA declines over the last year (though FY 2015 revenues were up about 1.5% on a constant FY 2014 currency basis). The rating also considers the company's strong niche position in the simulation and analysis software industry. The company has built a strong niche providing finite element and related analytic software to large customers in the automotive, aerospace and defense industries. Although demand for simulation and analysis software is expected to grow at strong rates (given its ability to build and test virtual prototypes and shorten time-to-market of new product designs), MSC has struggled to offset revenue declines from its mature NASTRAN and PATRAN products with growth from new products like MSC Apex. Moody's said, "leverage was about 8.2x based on March 31, 2016 LTM results (including Moody's standard adjustments). Leverage is expected to decline below 8x over the next 12 to 18 months. However, we expect debt to EBITDA will remain above 7x for the next two years. Free cash flow ("FCF") to debt was about 5.8% for the LTM period ended March 2016 and is expected to be maintained around 5% over the next 12-18 months, a relatively strong level among B3 rated peers. The ratings could be downgraded if leverage is expected to exceed 8.5x or FCF to debt turns negative. The ratings could also be downgraded if maintenance revenues were to deteriorate materially due to competitive pressures or if liquidity were to weaken substantially. Though unlikely in the near term, ratings could be upgraded if leverage were sustained below 6x and FCF to debt is sustained around 7%. "Liquidity is good based on an expectation of $20 million or more of FCF over the next 12 months, $51 million of cash on the balance sheet as of March 31, 2016 and an undrawn $10 million committed revolving credit facility. The company is required to comply with a springing first lien net leverage ratio financial covenant on the last day of any test period in which the outstanding revolver balance exceeds 25% of the principal amount of all revolver commitments. MSC would not meet the covenant level if sprung, however, we do not believe the company will need access to the revolver given the substantial cash balance." Downgrades: Issuer: MSC Software Corporation -- Probability of Default Rating, Downgraded to B3-PD from B2-PD -- Corporate Family Rating, Downgraded to B3 from B2 -- Second Lien Term Loan, Downgraded to Caa2 (LGD5) from Caa1 (LGD6) Outlook Actions: Issuer: MSC Software Corporation -- Outlook, Remains Stable Affirmations: Issuer: MSC Software Corporation -- First Lien Term Loan, Affirmed B1 (LGD3) MSC Software is a provider of simulation and analysis software primarily for mechanical engineering applications. The company is owned by private equity investor Symphony Technology Group and Elliott Associates. Revenue for FY 2015 was $197 million. MUSCLEPHARM CORP: Settles with ETW Corp. for $2.5 Million --------------------------------------------------------- MusclePharm Corporation entered into a Settlement Agreement with ETW Corp. on May 19, 2016. The Settlement Agreement eliminates all costs and terminates all future commitments between Tiger Woods and the Company under the Endorsement Agreement between the Company and ETW, dated July 1, 2014, as disclosed in a regulatory filing with the Securities and Exchange Commission. Pursuant to the Settlement Agreement, the Company agreed to pay $2.5 million to terminate the parties' obligations under Endorsement Agreement, effective as of May 19, 2016, and to resolve all disputes between them. As of March 31, 2016, the Company had accrued $7.0 million in relation to the Endorsement Agreement. About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life- style company that develops and manufactures a full line of National Science Foundation approved nutritional supplements that are 100 percent free of banned substances. MusclePharm is sold in over 120 countries and available in over 5,000 U.S. retail outlets, including GNC and Vitamin Shoppe. MusclePharm products are also sold in over 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. MusclePharm Corporation reported a net loss of $13.8 million in 2014, a net loss of $17.7 million in 2013 and a net loss of $19 million in 2012. As of March 31, 2016, MusclePharm had $61.2 million in total assets, $73.1 million in total liabilities and a total stockholders' deficit of $11.9 million. NATIONAL BANK OF ANGUILLA: Chapter 15 Case Summary -------------------------------------------------- Chapter 15 Petitioner: William Tacon, in his capacity as Administrator and Foreign Representative Chapter 15 Debtor: National Bank of Anguilla (Private Banking & Trust) Ltd. Ritter House P.O. Box 3486 Wickhams Cay II Tortola, British Virgin Islands Chapter 15 Case No.: 16-11529 Chapter 15 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Hon. Martin Glenn Chapter 15 Petitioner's Counsel: James C. McCarroll, Esq. Jordan W. Siev, Esq. Kurt F. Gwynne, Esq. REED SMITH, LLP 599 Lexington Avenue New York, NY 10022 Tel: (212) 521-5400 Fax: (212) 521-5450 E-mail: jmccarroll@reedsmith.com jsiev@reedsmith.com kgwynne@reedsmith.com Estimated Assets: Not Indicated Estimated Debts: Not Indicated NAVISTAR INTERNATIONAL: Files 2015 Conflicts Minerals Report ------------------------------------------------------------ In accordance with Rule 13p-1 under the Securities Exchange Act of 1934, Navistar submitted with the Securities and Exchange Commission a specialized disclosure form as well as a Conflict Minerals Report. Conflict Minerals are defined as cassiterite, columbite-tantalite, gold, wolframite, and their derivatives, which are limited to tin, tantalum, and tungsten (collectively, with gold, "3TG"). "The products which Navistar manufactures are complex and typically contain thousands of parts from multiple suppliers. Navistar's performance requirements for its products often require the use of 3TG. For the 2015 calendar year, Navistar undertook a Reasonable Country of Origin Inquiry focused on our direct suppliers for its Truck segment. The Company's Truck segment accounted for approximately 71% of Navistar's net sales and revenues for fiscal year 2015. The Company believes this approach was reasonable as suppliers in this segment also service other business segments," the Company said in the report. As compared to 2014, Navistar has made progress in 2015 in its RCOI efforts. For calendar year 2015 the Company expanded its scope of suppliers and focused on our direct suppliers in North America. The Company sent a notification to its in-scope suppliers informing them about the Conflict Minerals disclosure requirements to which the Company is subject, and requesting they complete a Conflict Minerals survey using the template developed by the Electronic Industry Citizenship Coalition and the Global e-Sustainability Initiative, known as the EICC GeSI Conflict Minerals Reporting Template (CMRT). A full-text copy of the Conflicts Minerals Report is available for free at https://is.gd/xQ5moH About Navistar International Navistar International Corporation (NYSE: NAV) -- http://www.navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The Company also provides truck and diesel engine parts and service. Another affiliate offers financing services. As of Jan. 31, 2016, Navistar had $5.98 billion in total assets, $11.17 billion in total liabilities and a total stockholders' deficit of $5.19 billion. * * * In the July 22, 2015, edition of the TCR, Moody's Investors Service affirmed Navistar International Corporation's Corporate Family Rating at B3 and assigned a Ba3 rating to Navistar, Inc.'s new $1.04 billion senior secured term loan due 2020. Navistar carries a 'B-' issue-level rating from Standard & Poor's Ratings Services and 'CCC' Issuer Default Ratings from Fitch Ratings. NEW PHOENIX: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: New Phoenix Metals, Ltd. 6400 Industrial Blvd. Greenville, TX 75402 Case No.: 16-32075 Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Hon. Stacey G. Jernigan Debtor's Counsel: Joyce W. Lindauer, Esq. JOYCE W. LINDAUER ATTORNEY, PLLC 12720 Hillcrest Road, Suite 625 Dallas, TX 75230 Tel: (972) 503-4033 Fax: (972) 503-4034 E-mail: joyce@joycelindauer.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Marcus D. Carl, partner. The Debtor did not include a list of its largest unsecured creditors when it filed the petition. NEWLEAD HOLDINGS: Incurs $97.1 Million Net Loss in 2015 ------------------------------------------------------- NewLead Holdings Ltd. filed with the Securities and Exchange Commission its annual report on Form 20-F disclosing a net loss attributable to the Company's common shareholders of US$97.14 million on US$27.81 million of revenues for the year ended Dec. 31, 2015, compared to a net loss attributable to Holdings' common shareholders of US$100.22 million on US$12.07 million of revenues for the year ended Dec. 31, 2014. As of Dec. 31, 2015, NewLead had US$121.76 million in total assets, US$296.97 million in total liabilities and a total shareholders' deficit of US$175.20 million. EisnerAmper LLP, in New York, New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company has incurred a net loss and utilized cash in operating activities for the year ended December 31, 2015 and as of December 31, 2015, has both a working capital deficiency and shareholders' deficit and, in addition, is in default on a significant portion of its outstanding obligations. All such events and conditions raise substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the Form 20-F is available for free at: https://is.gd/mlHnpP About NewLead Holdings Ltd. NewLead Holdings Ltd. -- http://www.newleadholdings.com/-- is an international, vertically integrated shipping company that owns and manages product tankers and dry bulk vessels. NewLead currently controls 22 vessels, including six double-hull product tankers and 16 dry bulk vessels of which two are newbuildings. NewLead's common shares are traded under the symbol "NEWL" on the NASDAQ Global Select Market. NORANDA ALUMINUM: Bonuses Approved While Ch. 11 Battle Brews ------------------------------------------------------------ Jacqueline Palank, writing for Daily Bankruptcy Review, reported that a bankruptcy judge signed off on in bonuses for Noranda Aluminum Inc. executives and other employees while a fight continues to brew over the aluminum maker's future. According to the report, Judge Barry S. Schermer of the U.S. Bankruptcy Court in St. Louis on May 26 authorized Noranda to pay up to $3.3 million in incentives to senior officials, including Chief Executive Layle Smith, as well as nearly $1 million in retention payments for lower-ranking employees, according to an audio recording of the May 26 hearing posted to the court docket. The KEIP contains, among others, the following relevant terms: (a) Participants: The Debtors identified nineteen (19) senior employees ("KEIP Participants") who are essential to the Debtors' continued operations during the chapter 11 process. Of the KEIP Participants, five are insiders and 14 are non-insiders. (b) Participation and Payment: KEIP Tier A has a target payout equal to 50% of such employee's base salary; KEIP Tier B has a target payout equal to 40% of base salary; and KEIP Tier C has a payout equal to 30% of base salary. For all KEIP Participants, payout is capped at 200% of target. For the 14 non-insider KEIP Participants, a payout floor of one-third of target has been set to ensure their retention throughout these Chapter 11 Cases. The KEIP Participants who are insiders are not guaranteed to receive any payout under the KEIP. (c) Total cost of KEIP: KEIP Insiders - 5 participants Total Plan Cost: Threshold: $512,504 Target: $1,028,007 Maximum: $2,050,015 Average Cost per Participant: Threshold: $102,501 Target: $205,001 Maximum: $410,003 KEIP Non- Insiders - 14 participants Total Plan Cost: Threshold: $521,376 Target: $1,042,751 Maximum: $2,085,502 Average Cost per Participant: Threshold: $37,241 Target: $74,482 Maximum: $148,964 Total Plan Cost: Threshold: $1,033,880 Target: $2,070,758 Maximum: $4,135,517 (d) Metrics designed to provide challenging targets for the KEIP Participants: funding metrics and performance metrics. Funding metrics are tied to cash flow and/or sale proceeds, which are appropriate proxies for the success of an organization operating in chapter 11. The level of achievement of the funding metrics determines the payout available to the KEIP Participants. Performance metrics are unique to each KEIP Participant and are designed to incentivize participants to reach specific key milestones by a set date, thus helping progress the Chapter 11 Cases. The KERP contains, among others, the following relevant terms: (a) Participants: The Debtors identified 34 employees who are critical to the Debtors' continued operations and to successful restructuring of the estates ("KERP Participants"). The KERP Participants represent a cross-section of various functions within the Debtors' businesses, including plant management, information technology, technical support, government affairs, sales, tax and payroll. These KERP Participants are heavily involved in both the day-to-day support functions of the business and chapter 11-related functions. (b) Participation and Payment: Assuming all KERP Participants are eligible to receive payments under the KERP, proposed payments thereunder will be approximately $895,763, which amounts to approximately $26,346 per KERP Participant. In determining the amount of payments for each KERP Participants, all such participants are divided into the following tiers: (i) KERP Tier A, with payout equal to 30% of base salary; (ii) KERP Tier B, with payout equal to 20% of base salary; and (iii) KERP Tier C, with payout equal to 10% of base salary. As previously reported by The Troubled Company Reporter, the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy Allied Industrial and Service Workers International Union, and Daniel J. Casamatta, the Acting U.S. Trustee for Region 13, opposed approval of the Debtors' proposed key employee incentive plan, key employee retention plan, and Incentive Compensation Plan. United Steelworkers, which is the collective bargaining representative of the Debtors' employees at their Gramercy, Louisiana, New Madrid, Missouri and Salisbury, North Carolina facilities, and a member of the Official Committee of Unsecured Creditors, complains that the Debtors justify the implementation of KEIP, KERP and Incentive Compensation Plan as necessary to maintain the morale of its management employees under difficult circumstances, and seek to justify millions in additional compensation for senior management through multiple bonus compensation schemes while at the same time seeking to terminate hourly employees retirement plans and slash wages and eliminate protective work rules. The U.S. Trustee complains that the Debtors have not met their burden of demonstrating: (a) that the KEIP is not a retention plan, (b) that all of the 34 KERP participants are not insiders of the Debtors, and, thus, not subject to the stricter requirements, and (c) that there is any causal relationship between the individual participants receiving bonuses under the plans and the specific target metrics which the Debtors purportedly seek to achieve under the plans, and thus the Debtors cannot meet their burden of demonstrating that the plans are "justified under the facts and circumstances of the case." United Steelworkers is represented by: Janine M. Martin, Esq. Emily R. Perez-Estepp, Esq. HAMMOND and SHINNERS, P.C. 7730 Carondelet, Suite 200 St. Louis, Missouri 63105 Telephone: (314) 727-1015 Facsimile: (314) 727-6804 Email: jmartin@hammondshinners.com eperez@hammondshinners.com -- and -- Thomas N. Ciantra COHEN, WEISS AND SIMON LLP 330 West 42nd Street New York, New York 10036-6979 Telephone: (212) 563-4100 Facsimile: (646) 473-8228 Email: tciantra@cwsny.com -- and -- David Jury, Esq. Associate General Counsel UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY ALLIED INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION Five Gateway Center Pittsburgh, Pennsylvania 15222 Telephone: (412) 562-2400 Facsimile: (412) 562-2574 Email: djury@usw.org Daniel J. Casamatta, the Acting U.S. Trustee for Region 13 is represented by: Paul A. Randolph, Esq. ASSISTANT UNITED STATES TRUSTEE 111 S. 10th Street, Suite 6.353 St. Louis, MO 63102 Telephone: (314) 539-2984 Facsimile: (314) 539-2990 Email: paul.a.randolph@usdoj.gov About Noranda Aluminum Noranda Aluminum, Inc., and 10 of its affiliates filed separate Chapter 11 bankruptcy petitions (Bankr. E.D. Mo. Proposed Lead Case No. 16-10083) on Feb. 8, 2016. The petitions were signed by Dale W. Boyles, the chief financial officer. Judge Barry S. Schermer is assigned to the cases. The Debtors have engaged Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel, Carmody MacDonald P.C. as local counsel, PJT Partners, LP as investment banker, Alvarez & Marsal North America, LLC as restructuring advisors and Prime Clerk LLC as claims, solicitation and balloting agent. The Debtors estimated both assets and liabilities in the range of $1 billion to $10 billion. As of the Petition Date, the Debtors had approximately $529.6 million in outstanding principal amount of secured indebtedness, consisting of a revolving credit facility and a term loan facility. The Debtors had approximately 1,857 employees as of the Petition Date. NORFE GROUP: Hires Totti & Rodriguez as Special Counsel ------------------------------------------------------- Norfe Group Corp. seeks approval from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Totti & Rodriguez Diaz, P.S.C. as its special counsel. Totti & Rodriguez will continue to represent the Debtor in a case filed by Consejo de Titulares del Condominio 221 Plaza. The firm's hourly rates are: Partners $200 Associates $175 Paralegals $80 Etienne Totti del Valle, Esq., a partner at Totti & Rodriguez, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Etienne Totti del Valle Totti & Rodriguez Diaz, P.S.C. Union Plaza Building, Suite 1200, 416 Ponce de Leon Avenue Hato Rey, Puerto Rico 00918 Phone: (787) 753-7910 Fax: (787) 764-9480 Email: trd@trdlaw.com About Norfe Group Norfe Group Corp. filed a Chapter 11 bankruptcy petition (Bankr. D.P.R. Case No. 16-00285) in Old San Juan, Puerto Rico, on Jan. 20, 2016. The petition was signed by David Efron, president. The firm scheduled $17,269,436 in total assets and $31,441,591 in total liabilities. The Debtor tapped Charles Alfred Cuprill, Esq., at Charles A Cuprill, PSC Law Office, as counsel. CPA Luis R. Carrasquillo & Co., P.S.C., serves as financial consultant. NORTEL NETWORKS: Appeals and Cross-Appeals Certified to 3rd Cir. ---------------------------------------------------------------- Judge Leonard P. Stark of the United States District Court for the District of Delaware certified 18 consolidated bankruptcy appeals and contingent cross-appeals directly to the Third Circuit in the case captioned Nortel Networks Inc., et al. Appellants and Cross-Appellees, v. Ernst & Young Inc., as Monitor and Foreign Representative of the Canadian Debtors, et al., Appellees and Cross-Appellants, Bankruptcy Case No. 09-10138 (KG). Jointly Administered (D. Del.), relating to In re: Nortel Networks Inc., et al., Chapter 11, Debtors. The 18 consolidated bankruptcy appeals and contingent cross-appeals relate to the allocation method to be used in connection with disbursement of $7.3 billion being held in escrow for payment to the estates of Nortel Networks Inc. and those of other Nortel entities, including Nortel Networks Corporation and Nortel Networks Limited, NNSA, and a group of subsidiaries located in Europe, the Middle East, and Africa. A full-text copy of Judge Stark's May 17, 2016 memorandum opinion is available at https://is.gd/0XxNaY from Leagle.com. Nortel Networks Inc., et al. is represented by: Steven D. Pohl, Esq. One Financial Center Boston, MA 02111 Tel: (617)856-8200 Fax: (617)856-8201 Email: spohl@brownrudnick.com -- and -- Tamara K. Minott, Esq. MORRIS, NICHOLS, ARSCHT & TUNNELL LLP 1201 North Market Street, 16th Floor Wilmington, DE 19899-1347 Tel: (302)658-9200 Fax: (302)658-3989 Email: tminott@mnat.com Nortel Networks Inc. is represented by: Derek C. Abbott, Esq. Eric D. Schwartz, Esq. Tamara K. Minott, Esq. MORRIS, NICHOLS, ARSHT & TUNNELL LLP 1201 North Market Street, 16th Floor Wilmington, DE 19899-1347 Tel: (302)658-9200 Fax: (302)658-3989 Email: dabbott@mnat.com eschwartz@mnat.com tminott@mnat.com Official Committee of Unsecured Creditors is represented by: Christopher M. Samis, Esq. Leslie Katherine Good, Esq. WHITEFORD, TAYLOR & PRESTON, L.L.C. The Renaissance Center, Suite 500 405 North King Street Wilmington, DE 19801-3700 Tel: (302)353-4144 Fax: (302)661-7950 Email: csamis@wtplaw.com kgood@wtplaw.com Ad Hoc Bondholder Group is represented by: Laura Davis Jones, Esq. Peter James Keane, Esq. PACHULSKI, STANG, ZIEHL & JONES, LLP 919 North Market Street, 17th Floor Wilmington, DE 19801 Tel: (302)652-4100 Fax: (302)652-4400 Email: ljones@pszjlaw.com pkeane@pszjlaw.com -- and -- Nicholas A. Bassett, Esq. 1850 K Street, NW Suite 1100 Washington, DC 20006 Tel: (202)835-7500 Fax: (202)263-7586 Email: nbassett@milbank.com Bank of New York Mellon, as Indenture Trustee, is represented by: Michael R. Lastowski, Esq. Christopher M. Winter, Esq. DUANE MORRIS LLP 222 Delaware Avenue, Suite 1600 Wilmington, DE 19801-1659 Tel: (302)657-4900 Fax: (302)657-4901 Email: mlastowski@duanemorris.com cmwinter@duanemorris.com Law Debenture Trust Company of New York is represented by: Stephen M. Miller, Esq. MORRIS JAMES LLP 500 Delaware Avenue, Suite 1500 Wilmington, DE 19899-2306 Tel: (302)888-6800 Fax: (302)571-1750 Email: smiller@morrisjames.com Ernst & Young Inc. is represented by: Mary Fagan Caloway, Esq. Kathleen Ann Murphy, Esq. BUCHANAN INGERSOLL & ROONEY P.C. 919 North Market Street, Suite 1500 Wilmington, DE 19801-3046 Tel: (302)552-4200 Fax: (302)552-4295 Email: mary.caloway@bipc.com kathleen.murphy@bipc.com Canadian Creditors Committee is represented by: Selinda A. Melnik, Esq. DLA PIPER LLP 1201 North Market Street, Suite 2100 Wilmington, DE 19801 Tel: (302)468-5700 Fax: (302)394-2341 Email: selinda.melnik@dlapiper.com Wilmington Trust, N.A., as Indenture Trustee is represented by: William E. Chipman, Jr., Esq. Mark D. Olivere, Esq. CHIPMAN BROWN CICERO & COLE, LLP Hercules Plaza 1313 N. Market Street, Suite 5400 Wilmington, DE 19801 Tel: (302)295-0191 Email: chipman@chipmanbrown.com olivere@chipmanbrown.com Ernst & Young LLP is represented by: Edwin J. Harron, Esq. John T. Dorsey, Esq. YOUNG, CONAWAY, STARGATT & TAYLOR LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Tel: (302)571-6600 Fax: (302)571-1253 Email: eharron@ycst.com jdorsey@ycst.com -- and -- Charles H. Huberty, Esq. One Battery Park Plaza New York, NY 10004-1482 Tel: (212)837-6000 Fax: (212)422-4726 Email: charles.huberty@hugheshubbard.com Stephen Taylor is represented by: Robert A. Weber, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM One Rodney Square 920 N. King Street Wilmington, DE 19801 Tel: (302)651-3000 Fax: (302)651-3001 Email: robert.weber@skadden.com U.K. Pension Claimants is represented by: Charlene D. Davis, Esq. Justin R. Alberto, Esq. BAYARD, P.A. 222 Delaware Avenue, Suite 900 Wilmington, DE 19801 Tel: (302)655-5000 Fax: (302)658-6395 Email: cdavis@bayardlaw.com jalberto@bayardlaw.com Nortel Trade Claims Consortium is represented by: Jeffrey M. Schlerf, Esq. Learon John Nelson Bird, Esq. FOX ROTHSCHILD LLP Citizens Bank Center 919 North Market Street, Suite 300 Wilmington, DE 19899-2323 Tel: (302)654-7444 Fax: (302)656-8920 Email: jschlerf@foxrothschild.com lbird@foxrothschild.com Office of the United States Trustee is represented by: Mark S. Kenney, Esq. U.S. TRUSTEE 844 King Street, Suite 2207 Wilmington, DE 19801 Tel: (302)573-6491 Fax: (302)573-6497 Pension Benefit Guaranty Corporation is represented by: Garth D. Wilson, Esq. Vicente Matias Murrell, Esq. PENSION BENEFIT GUARANTY CORPORATION 1200 K Street, NW Washington, DC 20005 Tel: (202)326-4020 Fax: (202)326-4112 About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., and Howard S. Zelbo, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serve as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. The trial on how to divide proceeds among creditors in the U.S., Canada, and Europe commenced on Sept. 22, 2014. The question of how to divide $7.3 billion raised in the international bankruptcy of Nortel Networks Corp. was answered on May 12, 2015, by two judges, one in the U.S. and one in Canada. According to The Wall Street Journal, Justice Frank Newbould of the Ontario Superior Court of Justice in Toronto and Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., agreed on the outcome: a modified pro rata split of the money. NORTEL NETWORKS: Appeals Certified to Third Circuit --------------------------------------------------- Judge Leonard P. Stark of the United States District Court for the District of Delaware certified directly to the United States Court of Appeals for the Third Circuit all of the appeals, including the contingent cross-appeals, in the bankruptcy case captioned In re: Nortel Networks Inc., et al., Debtors, Bankruptcy Case No. 09-10138 (KG) Jointly Administered (Bankr. D. Del.). The 18 consolidated bankruptcy appeals and contingent cross-appeals relate to the allocation method to be used in connection with the disbursement of $7.3 billion being held in escrow for payment to the estates of Nortel Networks Inc. and those of other Nortel entities, including Nortel Networks Corporation and Nortel Networks Limited, NNSA, and a group of subsidiaries located in Europe, the Middle East, and Africa. The appealed cases are Nortel Networks Inc., et al., v. Appellants and Cross-Appellees, Ernst & Young Inc., as Monitor and Foreign Representative of the Canadian Debtors, et al., Appellees and Cross-Appellants, Civil Action No. 15-624 (LPS) Civil Action No. 15-586 (LPS) Civil Action No. 15-622 (LPS) Civil Action No. 15-623 (LPS) Civil Action No. 15-627 (LPS) Civil Action No. 15-628 (LPS) Civil Action No. 15-635 (LPS) Civil Action No. 15-636 (LPS) Civil Action No. 15-699 (LPS) Misc. Action No.15-196 (LPS) Misc. Action No. 15-197 (LPS) CONSOLIDATED APPEALS (D. Del.). A full-text copy of Judge Stark's February 22, 2016 memorandum opinion is available at http://bankrupt.com/misc/NORTEL1240517.pdf . About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., and Howard S. Zelbo, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serve as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. The trial on how to divide proceeds among creditors in the U.S., Canada, and Europe commenced on Sept. 22, 2014. The question of how to divide $7.3 billion raised in the international bankruptcy of Nortel Networks Corp. was answered on May 12, 2015, by two judges, one in the U.S. and one in Canada. According to The Wall Street Journal, Justice Frank Newbould of the Ontario Superior Court of Justice in Toronto and Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., agreed on the outcome: a modified pro rata split of the money. NORTEL NETWORKS: Canadian Units, et al., Oppose Distribution to LSI ------------------------------------------------------------------- Solus Alternative Asset Management LP and PointState Capital LP, Ernst & Young Inc., the court-appointed Monitor and foreign representative of Nortel Networks Corporation, Nortel Networks Limited and certain of their Canadian subsidiaries, and the Ad Hoc Bondholders Group oppose Liquidity Solutions, Inc.'s request for the U.S. Bankruptcy Court to direct Nortel Networks Inc. to make interim distributions on allowed administrative, priority, and unsecured claims. The Objectors aver that, while the prospect of receiving an interim distribution has undeniable appeal, the inevitable consequences militate against it, as such, LSI’s proposal for an interim distribution at this time is not yet appropriate. According to Objectors, in order to make distributions to unsecured creditors, the Debtors would have to take adequate reserves first for various administrative and priority claims as well as to ensure that they have adequate cash available to satisfy administrative claims that could arise during the course of these cases. Given the size of the unliquidated administrative and general unsecured claims pools, the cash on hand would be too small to justify the expense and distraction after reserves are taken for unresolved administrative and unsecured claims, literally there will be no funds remaining for distribution to the full creditor body, the Objectors aver. The Objectors further aver that the Court should not take precipitous action based on the request of a single creditor holding allowed administrative and priority claims of approximately $330,000 that would potentially prejudice other similarly situated creditors of the US Debtors. Moreover, the Court's prior orders in respect of the broader dispute over allocation of the escrowed sale proceeds are subject to pending appeals in the U.S. District Court for the District of Delaware, as such, the Court should reject any invitation in the Supplemental Motion and in any objections and other responses thereto to re-litigate issues that have already been decided by the Court and that are now on appeal. Attorneys for Ernst & Young Inc., as Monitor and Foreign Representative of the Canadian Debtors: Mary F. Caloway, Esq. Kathleen A Murphy, Esq. BUCHANAN INGERSOLL & ROONEY PC 919 North Market Street, Suite 1500 Wilmington, Delaware 19801 Telephone: (302) 552-4200 Facsimile: (302) 552-4295 Email: mary.caloway@bipc.com kathleen.murphy@bipc.com -- and -- Ken Coleman, Esq. Daniel J. Guyder, Esq. ALLEN & OVERY LLP 1221 Avenue of the Americas New York, New York 10020 Telephone: (212) 610-6300 Facsimile: (212) 610-6399 Email: ken.coleman@allenovery.com daniel.guyder@allenovery.com Attorneys for Ad Hoc Group of Bondholders: Laura Davis Jones, Esq. Peter J. Keane, Esq. PACHULSKI STANG ZIEHL &JONES LLP 919 N. Market Street, 17th Floor PO Box 8705 Wilmington, Delaware 19899-8705 (Courier 19801) Telephone: (302) 652-4100 Facsimile: (302) 652-4400 Email: ljones@pszjlaw.com pkeane@pszjlaw.com -- and -- Dennis F. Dunne, Esq. Andrew M. Leblanc, Esq. Atara Miller, Esq. MILBANK, TWEED, HADLEY &MCCLOY LLP 28 Liberty Street New York, New York 10005-1413 Telephone: (212) 530-5000 Facsimile: (212) 530-5219 Email: ddunne@milbank.com aleblanc@milbank.com amiller@milbank.com Counsel to Solus Alternative Asset Management LP and PointState Capital LP Joanne P. Pinckney, Esq. PINCKNEY, URBAN, WEIDINGER & JOYCE LLC 3711 Kennett Pike, Suite 210 Greenville, DE 19807 Telephone: (302) 504 1497 Email: jpinckney@pwujlaw.com -- and -- James C. Tecce, Esq. QUINN, EMANUEL, URQUHART & SULLIVAN LLP 52 Madison Avenue, 22nd Floor New York, New York 10010 Telephone: (212) 849-7000 Email: jamestecce@quinnemanuel.com About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., and Howard S. Zelbo, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serve as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. The trial on how to divide proceeds among creditors in the U.S., Canada, and Europe commenced on Sept. 22, 2014. The question of how to divide $7.3 billion raised in the international bankruptcy of Nortel Networks Corp. was answered on May 12, 2015, by two judges, one in the U.S. and one in Canada. According to The Wall Street Journal, Justice Frank Newbould of the Ontario Superior Court of Justice in Toronto and Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., agreed on the outcome: a modified pro rata split of the money. OCI BEAUMONT: S&P Affirms 'B' CCR, Off CreditWatch Positive ----------------------------------------------------------- S&P Global Ratings affirmed its 'B' corporate credit and 'B+' issue-level ratings on Texas-based OCI Beaumont LLC and removed them from CreditWatch where S&P placed them with positive implications Aug. 6, 2015. The outlook is negative. The recovery rating on the senior secured debt remains '2', indicating substantial (70%-90%, lower half of the range) recovery in the event of a default. "The rating action reflects our view that OCI Beaumont's credit quality no longer benefits from a potential acquisition by a higher-rated entity," said S&P Global Ratings credit analyst Paul Kurias. "We believe operating performance at OCI Beaumont, which has weakened in recent quarters, the potential for covenant compliance issues, and near-term refinancing requirements are among the key factors that could contribute to a potential deterioration in the company's credit quality," he added. S&P's affirmation of the corporate credit rating and other ratings reflects its base case view under which S&P believes that despite weak earnings in 2016 the company's credit metrics will remain appropriate for the aggressive financial risk profile and the rating. S&P's assessment of the company's aggressive financial risk and vulnerable business risk map to a 'b' anchor score. Modifiers do not affect the rating. S&P views the company as moderately strategic to the OCI N.V. group and view the group credit profile assessment as neutral to the rating outcome at the current rating. The negative outlook reflects the risk that the company's earnings could be weaker than projections in 2016, which could lead to decreased covenant cushions and potentially causing or compliance issues. The outlook also reflects the risk that the company will be unable to timely amend covenants in 2017, and extend the March 2017 maturity of its revolving credit facility. S&P assumes ongoing weakness in EBITDA in 2016, following depressed 2015 EBITDA. S&P expects the company will be prudent in its dividend payout so that liquidity doesn't weaken further. S&P could lower ratings if total debt to EBITDA is more than 5x or FFO to total debt drops below 12% at any point over the next 12 months due to operating weakness, acquisitions, investments, or other large debt-funded growth initiatives, or shareholder rewards with no near-term prospects for improvement. S&P could lower ratings if the company does not proactively extend the revolver maturity well before its March 2017 maturity or amend covenants well before their second-quarter 2017 tightening. S&P could also lower ratings if the company's free cash flow turned negative for several quarters, or if liquidity weakened including if the company had trouble complying with 2016 and first-quarter 2017 covenants. S&P could also lower ratings if it believes creditors will cause an acceleration of the term loan. S&P could revise the outlook to stable if the company successfully extended the date of its upcoming debt maturities, and if covenants were amended on a long-term basis such that S&P believed that the company could remain in compliance. S&P believes OCI Beaumont's credit measures could be strong for the current rating for brief periods; however, S&P believes the company will support its own growth plans and, potentially, the parent OCI N.V.'s growth plans in a manner that could limit improvement in credit measures on a sustainable basis. OLD TAMPA BAY: Case Summary & 3 Unsecured Creditors --------------------------------------------------- Debtor: Old Tampa Bay Seafood Company, LLC dba I.C. Sharks 13040 Gandy Blvd. Saint Petersburg, FL 33702 Case No.: 16-04576 Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Jake C Blanchard, Esq. BLANCHARD LAW, P.A. 1501 S. Belcher Rd. Unit 2B Largo, FL 33771 Tel: 727-531-7068 Fax: 727-535-2086 E-mail: jake@jakeblanchardlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Brian Storman, managing member. A list of the Debtor's three largest unsecured creditors is available for free at http://bankrupt.com/misc/flmb16-04576.pdf OPEN TEXT: Moody's Rates Proposed Sr. Unsecured Notes Ba2 --------------------------------------------------------- Moody's Investors Service, affirmed Open Text Corp.'s Ba1 corporate family rating (CFR) and assigned a Ba2 rating to the company's proposed senior unsecured notes. Moody's also upgraded Open Text's senior secured debt facilities to Baa2 from Baa3 and affirmed the Ba2 rating on the company's existing senior unsecured notes due 2023 and other ratings as listed below. The proposed notes will be used for general corporate purposes including acquisitions. The ratings outlook remains stable. RATINGS RATIONALE The upgrade in the senior secured facilities to Baa2 reflects the increasing proportion of junior debt in the capital structure. In addition, the secured debt is now supported by additional cash in the capital structure. The affirmation of the Ba1 CFR reflects the expectation that though gross leverage increases to 3.7x from 2.8x as a result of the proposed notes, 1) net leverage remains unchanged at 1.4x at closing; 2) over time, the proceeds of the notes will effectively be used to acquire profitable assets; and 3) Open Text will focus on returning gross leverage to their 3x target level, or below. Moody's said, "The Ba1 corporate family rating recognizes Open Text's leading position within the growing $5 billion enterprise content management (ECM) market and B2B information exchange (IX) market, as well as its expanding role in the complementary business process management (BPM) and business analytics markets. As a result, the company has one of the broadest suites of products in the overall enterprise information management (EIM) industry (which includes ECM, BPM, analytics and IX). The ratings also reflect the stability of Open Text's enterprise software model with its large recurring revenue base. The company is expected to maintain relatively conservative financial policies and long term Debt to EBITDA is expected to trend around or below 3x and free cash flow to debt above 17.5%. The company is acquisitive however which could result in Debt to EBITDA occasionally exceeding this level. We expect limited organic growth in the near term and any growth to be driven by acquisitions. "The ratings could be downgraded if leverage is expected to exceed 3.25x or free cash flow to debt falls to below 15% for a sustained period. Consideration will be given, however, for very strong cash balances, particularly if we expect cash will be used to repay debt or acquire cash generating assets. As a result of the company's acquisition appetite, an upgrade to investment grade is unlikely in the next two to three years. Ratings could be raised if the company continues broadening its product portfolio and vertical market expertise while demonstrating organic revenue, profit and cash flow growth and maintaining leverage under 2.5x." Liquidity is expected to be very good based on cash on hand ($890 million of cash and short term investments as of March 31, 2016), an undrawn $300 million revolver and expectations of over $350 million of free cash flow over the next year. The company is expected to use existing cash and generated cash to fund acquisitions and occasional share repurchases. Upgrades: -- Issuer: Open Text Corp. -- Senior Secured Bank Credit Facility, Upgraded to Baa2 (LGD2) from Baa3 (LGD2) Assignments: -- Issuer: Open Text Corp. -- Proposed Senior Unsecured Regular Bond/Debenture, Assigned Ba2 (LGD5) Outlook Actions: -- Issuer: Open Text Corp. -- Outlook, Remains Stable Affirmations: -- Issuer: Open Text Corp. -- Probability of Default Rating, Affirmed Ba1-PD -- Speculative Grade Liquidity Rating, Affirmed SGL-1 -- Corporate Family Rating, Affirmed Ba1 -- Senior Unsecured Regular Bond/Debenture due 2023, Affirmed Ba2 (LGD5) Open Text Corp., headquartered in Waterloo, Ontario, Canada, is one of the largest providers of enterprise content management and business process management software. For twelve months ended March 31, 2016, revenues were approximately $1.8 billion. PACIFIC SUNWEAR: April 7, 2017 Fixed as New Maturity Date --------------------------------------------------------- Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for the District of Delaware issued his Second Order Amending the Interim DIP Order. Pacific Sunwear of California, Inc. and its affiliated Debtors had notified the Court of the Second Amendment to the Debtor-In-Possession Credit Agreement that it had executed with Wells Fargo Bank, National Association, as Administrative Agent and Collateral Agent, and the Lenders party thereto. The following amendments were made on the Credit Agreement: (1) The definition of "Maturity Date" as stated in Section 1.01 of the Credit Agreement was deleted in its entirety and substituted with the following: "Maturity Date" means the earliest of: (a) April 7, 2017, (b) if the Final Financing Order is not entered by May 27, 2016, immediately thereafter, (c) the effective date of a Chapter 11 plan of reorganization, and (d) the closing of a sale of all or substantially all of the assets of the Loan Parties pursuant to Section 363 of the Bankruptcy Code. (2) Clause (e)(iii) of Section 6.22 of the Credit Agreement was deleted in its entirety and substituted with the following: (iii) no later than June 24, 2016, an auction with respect to Competing Transaction (if any) will have been completed in accordance with the Bidding Procedures Order. (3) Clause (r)(vi) of Section 8.01 of the Credit Agreement was deleted in its entirety and substituted with the following: (vi) the Final Financing Order is not entered prior to the expiration of the Interim Financing Order, and in any event by May 27, 2016. The final hearing to consider entry of the Final Order and final approval of the DIP Facility is scheduled for May 26, 2016 at 10:00 a.m. Pacific Sunwear of California, Inc. and its affiliated Debtors are represented by: Michael R. Nestor, Esq. Joseph M. Barry, Esq. Maris J. Kandestin, Esq. Shane M. Reil, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Telephone: (302)571-6600 Facsimile: (302)571-1253 E-mail: mnestor@ycst.com jbarry@ycst.com mkandestine@ycst.com sreil@ycst.com - and - Michael L. Tuchin, Esq. David M. Guess, Esq. Jonathan M. Weiss, Esq. Sasha M. Gurvitz, Esq. KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 Avenue of the Stars, 39th Floor Los Angeles, CA 90067 Telephone: (310)407-4029 Facsimile: (310)407-9090 E-mail: mtuchin@ktbslaw.com dguess@kbtslaw.com jweiss@kbtslaw.com sgurvitz@kbtslaw.com About Pacific Sunwear Founded in 1982 in Newport Beach, California as a surf shop, Pacific Sunwear of California, Inc. operates in the teen and young adult retail sector, selling men's and womens apparel, accessories, and footwear. The Company went public in 1993 (NASDAQ: PSUN), and peaked with 965 stores in 2006. At present, the Company has approximately 593 retail locations nationwide under the names "Pacific Sunwear" and "PacSun," which stores are principally in mall locations. The Company has 2,000 full-time workers. Through its ecommerce business, the Company operates an e-commerce site at http://www.pacsun.com/ On April 7, 2016, Pacific Sunwear of California, Inc., and two affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The cases are jointly administered under Case No. 16-10882 and are pending before the Honorable Laurie Selber Silverstein. The Debtors sought Chapter 11 protection with a Chapter 11 plan that would convert debt into equity. The Debtors tapped Young Conaway Stargatt & Taylor, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP as attorneys; FTI Consulting, Inc., as financial advisor; Guggenheim Securities, LLC, as investment banker; and Prime Clerk LLC as claims and noticing agent. PACIFIC SUNWEAR: Assumption/Rejection Period Extended to Nov. 3 --------------------------------------------------------------- Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for the District of Delaware granted Pacific Sunwear of California, Inc., et al.'s motion seeking to extend the 120-day deadline to assume or reject unexpired leases of nonresidential real property to Nov. 3, 2016. Judge Silverstein held that the time within which the Debtors may assume or reject any unexpired leases of non-residential real property is extended to the earlier of (i) Nov. 3, 2016 and (ii) the confirmation date of the Debtors' Chapter 11 plan. He further held that assumption may be conditioned upon the occurrence of the effective date of the Debtors' chapter 11 plan. Landlord Bohannon Development Company and the Taubman Landlords opposed the Debtors' Motion to extend the deadline to assume or reject unexpired leases of nonresidential real property. "While BOHANNON is cognizant of the Debtor's need to evaluate the Leases in conjunction with their efforts to reorganize their financing affairs, nothing presented by the Debtor has presented a justifiable reason for causing the substantial damage which would result in BOHANNON being presented with an empty store immediately prior to the holiday without adequate time to contract a holiday tenant," Bohannon Development Company averred. "Landlords submit that, by making the Motion within the first few weeks of the case, with the bulk of the 120 days ahead of them, Debtors did not and cannot meet their burden to show cause for any extension when the Motion was made," the Taubman Landlords contended. The Debtors argued that they have amply met their burden of establishing that cause exists to extend the Assumption/Rejection period. They related that the reduction of the Debtors' occupancy costs is one of the primary tasks to be accomplished during the Cases. The Debtors further related that they are currently negotiating with their landlords regarding lease concessions, and the results of those negotiations will inform what the Debtors' lease footprint will look like going forward, and, by extension, which leases will be assumed and which will be rejected. Bohannon Development Company is represented by: Ian Connor Bifferato, Esq. Thomas F. Driscoll III, Esq. THE BIFFERATO FIRM P.A. 1007 N. Orange Street, 4th Floor Wilmington, DE 19801 Telephone: (302)429-0907 E-mail: cbifferato@bifferato.com tdriscoll@bifferato.com - and - Catherine Schlomann Robertson, Esq. PAHL & MCCAY, APC 225 W. Santa Clara St, Suite 1500 San Jose, CA 95113 Telephone: (408)286-5100 The Taubman Landlords are represented by: Susan E. Kaufman, Esq. LAW OFFICE OF SUSAN E. KAUFMAN, LLC 919 North Market Street, Suite 460 Wilmington, DE 19801 Telephone: (302)472-7420 Facsimile: (302)792-7420 E-mail: skaufman@skaufmanlaw.com - and - Andrew S. Conway, Esq. THE TAUBMAN COMPANY 200 East Long Lake Road, Suite 300 Bloomfield Hills, MI 48304 Telephone: (248)258-7427 E-mail: aconway@taubman.com Pacific Sunwear of California, Inc. and its affiliated Debtors are represented by: Michael R. Nestor, Esq. Joseph M. Barry, Esq. Maris Kandestin, Esq. Shane M. Reil, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Telephone: (302)571-6600 Facsimile: (302)571-1253 E-mail: mnestor@ycst.com jbarry@ycst.com mkandestin@ycst.com sreil@ycst.com - and - Michael L. Tuchin, Esq. David M. Guess, Esq. Jonathan M. Weiss, Esq. Sasha M. Gurvitz, Esq. KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 Avenue of the Stars, 39th Floor Los Angeles, CA 90067 Telephone: (310)407-4029 Facsimile: (310)407-9090 E-mail: mtuchin@ktbslaw.com dguess@ktbslaw.com jweiss@ktbslaw.com sgurvitz@ktbslaw.com About Pacific Sunwear Founded in 1982 in Newport Beach, California as a surf shop, Pacific Sunwear of California, Inc. operates in the teen and young adult retail sector, selling men's and womens apparel, accessories, and footwear. The Company went public in 1993 (NASDAQ: PSUN), and peaked with 965 stores in 2006. At present, the Company has approximately 593 retail locations nationwide under the names "Pacific Sunwear" and "PacSun," which stores are principally in mall locations. The Company has 2,000 full-time workers. Through its ecommerce business, the Company operates an e-commerce site at http://www.pacsun.com/ On April 7, 2016, Pacific Sunwear of California, Inc., and two affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The cases are jointly administered under Case No. 16-10882 and are pending before the Honorable Laurie Selber Silverstein. The Debtors sought Chapter 11 protection with a Chapter 11 plan that would convert debt into equity. The Debtors tapped Young Conaway Stargatt & Taylor, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP as attorneys; FTI Consulting, Inc., as financial advisor; Guggenheim Securities, LLC, as investment banker; and Prime Clerk LLC as claims and noticing agent. PACIFIC SUNWEAR: Court Authorizes KEIP and KERP Implementation -------------------------------------------------------------- Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for the District of Delaware authorized Pacific Sunwear of California, Inc. and its affiliated Debtors to implement their Key Employee Incentive Program ("KEIP") and Key Employee Retention Program ("KERP"). Judge Silverstein authorized the Debtors to implement their KEIP and KERP, despite the objection made by Andrew R. Vara. "The KEIP, although styled as an incentive bonus program, is in fact a retention bonus program seeking to distribute over $1.8 million to a select group of 9 insiders... The supposed "metrics" of the KEIP are illusory. Half of the maximum bonus for each participant is earned merely by having the Plan, which was filed on the Petition Date, go effective by September 30, 2016. That date is more than a month after the date by which the Debtors committed to have the Plan consummated under a Restructuring Support Agreement with their lenders. Even if the Plan does not go effective until after that date, the KEIP participants will still receive between 60% and 80% of the maximum bonus they could obtain under this metric, as long as the Plan goes effective by November 30, 2016... The Debtors fail, however, to disclose the names or titles of the KERP participants, even in the unredacted version of the Motion, except to say that they are "ranging from managers to vice-presidents." Vice-presidents are officers, and therefore presumed insiders under the Code, unless the Debtors can establish otherwise. As to the remaining KERP participants, the Motion does not set forth adequate information to determine the whether or not they are insiders," Mr. Vara averred. PS Holdings of Delaware Agency Corp., et al. ("Term Loan Parties") expressed their support for the Debtors' KEIP and KERP Motion. The Term Loan Parties contended that the awards and metrics proposed under the KEIP are appropriately tailored and reasonably designed under the circumstances to incentivize the management teal to facilitate a swift restructuring, meet certain sales performance metrics, and implement cost savings. They believed that the KERP will help to prevent attrition and boost employee morale during the Debtors' restructuring. Andrew R. Vara, Acting United States Trustee for Region 3, is represented by: Juliet Sarkessian, Esq. OFFICE OF THE UNTED STATES TRUSTEE J. Caleb Boggs Federal Building 844 King Street, Suite 2207, Lockbox 35 Wilmington, DE 19801 Telephone: (302)573-6491 Facsimile: (302)573-6497 E-mail: Juliet.M.Sarkessian@usdoj.gov PS Holdings of Delaware Agency Corp., et al., are represented by: 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 E-mail: dpacitti@klehr.com myurkewicz@klehr.com - 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 E-mail: mbranzburg@klehr.com - and - Nicole L. Greenblatt, Esq. KIRKLAND & ELLIS LLP 601 Lexington Avenue New York, NY 10022 Telephone: (212)446-4800 Facsimile: (212)446-4900 E-mail: nicole.greenblatt@kirkland.com - and - Melissa N. Koss, Esq. KIRKLAND & ELLIS LLP 555 California Street San Francisco, CA 940104 Telephone: (415)439-1400 Facsimile: (415)439-1500 E-mail: melissa.koss@kirkland.com About Pacific Sunwear Founded in 1982 in Newport Beach, California as a surf shop, Pacific Sunwear of California, Inc. operates in the teen and young adult retail sector, selling men's and womens apparel, accessories, and footwear. The Company went public in 1993 (NASDAQ: PSUN), and peaked with 965 stores in 2006. At present, the Company has approximately 593 retail locations nationwide under the names "Pacific Sunwear" and "PacSun," which stores are principally in mall locations. The Company has 2,000 full-time workers. Through its ecommerce business, the Company operates an e-commerce site at http://www.pacsun.com/ On April 7, 2016, Pacific Sunwear of California, Inc., and two affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The cases are jointly administered under Case No. 16-10882 and are pending before the Honorable Laurie Selber Silverstein. The Debtors sought Chapter 11 protection with a Chapter 11 plan that would convert debt into equity. The Debtors tapped Young Conaway Stargatt & Taylor, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP as attorneys; FTI Consulting, Inc., as financial advisor; Guggenheim Securities, LLC, as investment banker; and Prime Clerk LLC as claims and noticing agent. PALISADES PARK: Seeks to Hire Dean Smith as Appraiser ----------------------------------------------------- Palisades Park Plaza LLC seeks approval from the U.S. Bankruptcy Court for the District of New Jersey to hire an appraiser. The Debtor proposed to hire Dean Smith to conduct an appraisal of a real estate located at 500 Tenth Street, Palisades Park, New Jersey. John Sywilok, Esq., at John W. Sywilok LLC, said an appraisal of the property is necessary in order to determine the feasibility of a Chapter 11 plan. Mr. Smith will receive $3,400 in total compensation for his services. In a court filing, Mr. Smith disclosed that he is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Mr. Smith can be reached through these numbers: Dean M. Smith The Real Estate Consulting & Appraisal Group 1037 Route 46 East, Suite C205 Clifton, New Jersey 07013 Phone: (973) 779-8199 Fax: (973) 779-0601 Email: RECG02@optonline.net The Debtor can be reached through: John Sywilok, Esq. John W. Sywilok LLC 51 Main Street Hackensack, NJ 07601 (201) 487-9390 About Palisades Park Palisades Park Plaza LLC sought protection under Chapter 11 of the Bankruptcy Code in the District of New Jersey (Newark) (Case No. 15-32649) on December 1, 2015. The petition was signed by Chang Dong Kim, president. The case is assigned to Judge Stacey L. Meisel. The Debtor estimated assets of $0 to $50,000 and debts of $1 million to $10 million. PALMAZ SCIENTIFIC: Hires Kingman as Counsel ------------------------------------------- Palmaz Scientific, Inc., et al., seek authority from the U.S. Bankruptcy Court for the Western District of Texas to employ the Law Offices of William B. Kingman, P.C. as counsel to the Debtors. Palmaz Scientific requires Kingman to: -- counsel the Debtors' representatives in matters relating to the administration of the Bankruptcy Estate; -- represent the Debtors in negotiations with various creditors and equity holders; -- make court appearances and appearances before the U.S. Trustee on behalf of the Debtors; -- assist in the preparation of the Debtors' plan or reorganization and disclosure statement, -- prepare schedules and pleadings, analyze, negotiate and litigate claims which may be brought in the forms of objections or as adversary proceedings; and -- represent the Debtors and their bankruptcy estates in all other relevant matters relating to the administration of this case. Kingman will be paid at these hourly rates: William B. Kingman $350 Paralegal/ Legal Assistants $110 Kingman will be paid a retainer in the amount of $50,000. Kingman will also be reimbursed for reasonable out-of-pocket expenses incurred. William B. Kingman, shareholder and president of the Law Office of William B. Kingman, P.C., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Kingman can be reached at: William B. Kingman, Esq. LAW OFFICES OF WILLIAM B. KINGMAN, P.C. 4040 Broadway, Suite 450 San Antonio, Texas 78205 Tel: (210) 829-1199 Fax: (210) 821-1114 E-mail: bkingman@kingmanlaw.com About Palmaz Scientific Headquartered in San Antonio, Texas, Palmaz Scientific is a research and development company dedicated to the advancement of the technology and science of medical implants. Palmaz Scientific Inc., Advanced Bio Prosthetic Surfaces, Ltd., ABPS Management, LLC and ABPS Venture One, Ltd., filed Chapter 11 bankruptcy petitions (Bankr. W.D. Tex. Proposed Nos. 16-50552, 16-50555, 16-50556 and 16-50554, respectively) on March 4, 2016. The petitions were signed by Eugene Sprague as director. The Debtors estimated both assets and liabilities in the range of $10 million to $50 million. The Debtors have engaged Norton Rose Fulbright US LLP as counsel, Groff & Rothe as accountants and Upshot Services LLC as noticing agent. The case is assigned to Judge Craig A. Gargotta. PARADIGM ACQUISITION: Moody's Cuts Corporate Family Rating to B3 ---------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating of Paradigm Acquisition Corp. to B3 from B2 and Probability of Default Rating to B3-PD from B2-PD. Moody's also downgraded the company's first lien senior secured credit facilities to B2 (LGD 3) from B1 (LGD 3). The rating outlook is stable. The downgrade of the CFR reflects Moody's belief that significant reductions in leverage will not be forthcoming in the near term due to lower operating earnings and cash flow. With weaker EBITDA, Moody's expects adjusted debt to EBITDA to be above 7.5x, which is roughly 1 ½ turns higher than anticipated. Leverage will continue to improve over time, but at a much slower pace than originally expected. The following is a summary of Moody's rating actions: Ratings downgraded: Corporate Family Rating to B3 from B2 Probability of Default Rating to B3-PD from B2-PD $25 million senior secured first lien revolving credit facility to B2 (LGD 3) from B1 (LGD 3) $222 million senior secured first lien term loan to B2 (LGD 3) from B1 (LGD 3) The rating outlook is stable. RATINGS RATIONALE The B3 CFR reflects Paradigm's high financial leverage, modest absolute size based on revenues, and relatively high customer concentration within the niche sub-segment of the worker's compensation case management industry. With revenues ranging from $250 million to $300 million, Paradigm is small when compared to many other corporate issuers. The rating is supported by the company's leading market position, its high barriers to entry, strong customer retention and modest regulatory or reimbursement risk. Moody's anticipates that the company's positive, albeit modest, free cash flow will allow Paradigm to reduce leverage over time through a combination of organic EBITDA growth and debt repayment. The stable outlook incorporates Moody's expectation that the company will reduce leverage over time as it grows its core business and pursues cross selling opportunities, but that it will remain relatively small and highly levered. The ratings could be downgraded if the company's operating performance deteriorates. Ratings could also be downgraded if free cash flow turns negative, if liquidity deteriorates, or if it debt to EBITDA does not decline and approach 7.0x over the next 12-18 months. The ratings could be upgraded over the intermediate term if the company achieves greater scale, if operating performance improves, and if debt to EBITDA is sustained below 6.0x. Paradigm is the leading nationwide provider of outsourced catastrophic worker's compensation case management services for insurance companies and self-insured employers. The company's product offerings include acute and ongoing catastrophic, and case management services for traumatic brain injuries, spinal cord injuries, amputations, burns, wounds, and chronic pain. PARSLEY ENERGY: Moody's Assigns B3 Rating on $200MM Sr. Notes ------------------------------------------------------------- Moody's Investors Service assigned a B3(LGD5) rating to Parsley Energy, LLC's (Parsley) proposed offering of $200 million senior unsecured notes. The company will use the notes, in addition to the concurrent $203 million equity offering, to fund the acquisition of mineral rights and working interest of 30,000 acres in the Delaware Basin for $289.5 million, and for its capital spending program. Parsley's B2 Corporate Family Rating, stable outlook, and all other ratings are unchanged. "Parsley Energy's increased production and equity raise support its credit metrics despite the additional issuance of debt," said Arvinder Saluja, Moody's Vice President -- Senior Analyst. Parsley's production is expected to continue growing in 2016 and 2017 despite a weak commodity price environment. The company issued equity in April 2016 to fund acquisition of interests in the Southern Delaware Basin as well as the Midland Basin, both of which closed in May 2016. RATINGS RATIONALE The B3 rating on Parsley's proposed notes is the same as the rating on its existing $550 million unsecured notes due 2022. Both are a notch lower than the B2 CFR, consistent with Moody's Loss Given Default Methodology, due to the structural subordination of the notes to the $575 million secured revolving credit facility. The company's $575 million borrowing base revolver is due September 2018, and had $574.7 million available for borrowing as of March 31, 2016. Parsley's B2 CFR reflects the company's strong execution on its growth capital spending, rising EBITDA despite the fall in commodity prices, and improving credit metrics which have been helped by equity issuances. The B2 rating also reflects its relatively modest scale and concentrated geographic presence. The rating incorporates the impact of the low crude oil price environment, which is mitigated somewhat by Parsley's hedges for 2016 and 2017. The CFR is supported by quality acreage in the Permian Basin, liquids-rich production that generates good cash margins, multiple year drilling inventory, and a high degree (99%) of operational control over its leasehold acreage, which allows for flexible capital allocation and development of its acreage in light of crude price volatility. Parsley has guided to 2016 capex budget of $410 - 460 million. Even in this depressed price environment, the company's liquidity should be sufficient to cover the capex and increasing production volumes. Parsley's stable rating outlook reflects our expectation that production will be sustained at or above 30,000 boe/d in 2016 and cash flow metrics will remain strong. The rating could be upgraded if the company's annual average daily production were to reach 40,000 boe/d, retained cash flow to debt is likely to remain above 20%, and the company approaches cash flow neutrality after considering capital expenditures. The rating could be downgraded if retained cash flow to debt falls below 10%, EBITDA to Interest Expense falls below 2.5x, or liquidity worsens. The principal methodology used in this rating was Global Independent Exploration and Production Industry published in December 2011. Parsley Energy, LLC is an oil and gas exploration and production (E&P) company with all of its properties located in the Midland and Delaware Basins, which are sub-areas of the Permian Basin, in west Texas. PENN VIRGINIA: Asks to Assume Restructuring Support Agreement ------------------------------------------------------------- Penn Virginia Corporation and its affiliated debtors ask the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, for authorization to assume a Restructuring Support Agreement, a Backstop Commitment and Exit Commitment Letters. The Restructuring Support Agreement was entered into by the Debtors, the Lenders party to the RBL Credit Facility Agreement, the holders of notes issued pursuant to the Senior Indenture, dated as of June 15, 2009, for the 7.250% Senior Notes due 2019 and the 8.500% Senior Notes due 2020, and each of the DIP Lenders, the Backstop Parties, and the Exit Facility Lenders. The Restructuring Term Sheet attached to the Restructuring Support Agreement contemplates a swift restructuring financed by: (a) the consensual use of cash collateral, including funds retained from the Debtors prepetition Swap Contracts liquidations; (b) the DIP Financing; (c) the Exit Facility; and (d) the Rights Offering. The Restructuring Term Sheet contemplates a swift restructuring consummated in accordance with the following Milestones: (a) no later than 8:00 a.m. on May 12, 2016, the PVA Entities will commence the Chapter 11 Cases by filing bankruptcy petitions with the Bankruptcy Court; (b) on, or no later than 24 hours after, the Petition Date, the Debtors will file with the Bankruptcy Court a motion seeking entry of the Interim DIP Order and the Final DIP Order; (c) no later than three days after the Petition Date, the Debtors will file with the Bankruptcy Court (a) the Plan and the Disclosure Statement and (b) this motion; (d) no later than three days after the Petition Date, the Bankruptcy Court will have entered the Interim DIP Order; (e) no later than 15 days after the Petition Date, the Debtors will file with the Bankruptcy Court (a) a motion to establish a bar date for filing proofs of claim and (b) the schedules of assets and liabilities and statements of financial affairs for each Debtor; (f) no later than 30 days after the Petition Date, (i) the Bankruptcy Court will have entered the Final DIP Order, (ii) the Bankruptcy Court will have entered an order granting this motion, and (iii) the Debtors will have delivered a proposal with regard to the treatment of material contracts to the Majority Consenting Noteholders; (g) no later than 45 days after the Petition Date, the Bankruptcy Court will have entered an order ("Disclosure Statement Order") approving the adequacy of the Disclosure Statement and related solicitation procedures (including the Rights Offering Procedures); (h) no later than 45 days after the entry of the Disclosure Statement Order, the Bankruptcy Court will commence a hearing to confirm the Plan ("Confirmation Hearing"); (i) no later than 5 days after the commencement of the Confirmation Hearing, the Bankruptcy Court will enter an order ("Confirmation Order") confirming the Plan; and (j) no later than 25 days after entry of the Confirmation Order, the Debtors will consummate the transactions contemplated by the Plan. The Debtors relate that the Restructuring Support Agreement contains a number of provisions that will impact the administration of the chapter 11 cases. They further relate that in addition to certain other commitments, under the Restructuring Support Agreement, each of the Restructuring Support Parties agreed to "use commercially reasonable efforts to support and cooperate with the Debtors to take all commercially reasonable actions necessary to consummate the Restructuring Transactions in accordance with the Plan and the terms and conditions of the Agreement and the Restructuring Term Sheet." "The Debtors may, upon notice to the Restructuring Support Parties, terminate their obligations under the Restructuring Support Agreement upon: (a) certain defined breaches by a Restructuring Support Party of its obligations under the Restructuring Support Agreement; (b) if the Definitive Documents do not comply with the Restructuring Support Agreement; and (c) importantly, "if the board of directors or board of managers, as applicable, of any [Debtor] determines, after receiving advice from counsel, that proceeding with the Restructuring Transactions (including, without limitation, the Plan or solicitation of the Plan) would be inconsistent with the exercise of its fiduciary duties"... the Debtors have agreed to pay or reimburse all reasonable and documented fees of certain professionals ("Professional Fees") employed by the Consenting RBL Lenders and Consenting Noteholders," the Debtors aver. The Debtors relate that they executed a Backstop Commitment Agreement with certain of the Noteholders, prior to the Petition Date. The Debtors further relate that under the terms of the Restructuring Support Agreement, on the Effective Date, the Debtors will consummate the Rights Offering, which is backstopped by the Backstop Parties. The Debtors tell the Court that under the terms of the Backstop Commitment Agreement, in addition to agreeing to exercise fully all Subscription Rights issued to them pursuant to the Plan, the Backstop Parties have agreed to purchase all unsubscribed shares under the Rights Offering, at a Per Share Purchase Price that reflects a discount of 25 percent to the total settled plan equity value of $125 million. The Debtors further tell the Court that under the terms of the Backstop Commitment Agreement, the Debtors will pay the Backstop Parties either (a) a premium in an amount equal to $3,000,000 (which represents 6% of the $50 million aggregate Rights Offering amount) upon consummation of the Rights Offering, or (b) a termination fee in an amount equal to $2,000,000. The Debtors contend that the Backstop Parties may terminate their obligations under the Backstop Commitment Agreement upon written notice if the closing date of the Rights Offering has not occurred within 120 days after the Petition Date, which date may be extended with the requisite support of the Backstop Parties. "In addition, certain of the RBL Lenders, in their capacities as Exit Facility Lenders, executed the Exit Commitment Letters prior to the Petition Date, which were agreed to and accepted by the Debtors. Under the Exit Commitment Letters, the Exit Facility Lenders, subject to certain conditions, committed to fund their respective portions of the initial borrowing base limit of up to $128 million under the Exit Facility. The Exit Commitment Letters also provide that the Debtors will pay, as applicable: (a) a structuring fee to the RBL Agent, in its capacity as Exit Agent, on the closing date of the Exit Facility; (b) administrative fees to the Exit Agent both on and continuing after the closing date of the Exit Facility; (c) "upfront fees" in an aggregate amount equal to $1.28 million to the Exit Facility Lenders on the closing date of the Exit Facility; and (d) a termination fee in an aggregate amount equal to $1.28 million to the Exit Facility Lenders in the event that the Debtors are required to pay the termination fee under the Backstop Commitment Agreement... Similar to the Backstop Commitment Agreement, the Exit Facility Lenders may terminate their obligations under the Exit Commitment Letters if the closing date of the Exit Facility has not occurred within 120 days after the Petition Date, which date may be extended with the requisite support of the Exit Facility Lenders," the Debtors contend. Penn Virginia Corporation and its affiliated debtors are represented by: Edward O. Sassower, Esq. Joshua A. Sussberg, Esq. Brian E. Schartz, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, NY 10022 Telephone: (212)446-4800 Facsimile: (212)446-4900 E-mail: edward.sassower@kirkland.com joshua.sussberg@kirkland.com brian.schartz@kirkland.com - and - James H.M. Sprayregen, Esq. Justin R. Bernbrock, Esq. Benjamin M. Rhode, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Chicago, IL 60654 Telephone: (312)862-2000 Facsimile: (312)862-2200 E-mail: james.sprayregen@kirkland.com justin.bernbrock@kirkland.com benjamin.rhode@kirkland.com - and - Michael A. Condyles, Esq. Peter J. Barrett, Esq. Jeremy S. Williams, Esq. KUTAK ROCK LLP Bank of America Center 1111 East Main Street, Suite 800 Richmond, VA 23219 Telephone: (804)644-1700 Facsimile: (804)783-6192 E-mail: Michael.Condyles@KutakRock.com Peter.Barrett@KutakRock.com Jeremy.Williams@KutakRock.com About Penn Virginia Corporation Based in Radnor, Pennsylvania, Penn Virginia Corporation is an independent oil and gas company engaged in the exploration, development and production of oil, NGLs and natural gas in various domestic onshore regions of the United States, with a primary focus in the Eagle Ford Shale in South Texas. Each of Penn Virginia Corporation, Penn Virginia Holding Corp., Penn Virginia MC Corporation, Penn Virginia MC Energy L.L.C., Penn Virginia MC Operating Company L.L.C., Penn Virginia Oil & Gas Corporation, Penn Virginia Oil & Gas GP LLC, Penn Virginia Oil & Gas LP LLC and Penn Virginia Oil & Gas, L.P. filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case Nos. 16-32395 to 16-32403, respectively) on May 12, 2016. The petitions were signed by Seth R. Bullock as chief restructuring officer. The Debtors have engaged Kirkland & Ellis LLP as counsel, Kutak Rock LLP as local counsel, Jefferies LLC as investment banker, Alvarez & Marsal North America, LLC as restructuring advisor, KPMG LLP as tax advisor and Epiq Bankruptcy Solutions, LLC as notice, claims and balloting agent. PJT Partners is acting as financial advisor and Milbank, Tweed, Hadley & McCloy LLP is acting as legal advisor to the ad hoc committee of noteholders. Opportune LLP is acting as financial advisor and Bracewell LLP is acting as legal advisor to Wells Fargo (as agent) and the RBL lenders. Judge Keith L. Phillips has been assigned the cases. PENN VIRGINIA: Targeting Aug. 4 Confirmation of Plan ---------------------------------------------------- Penn Virginia Corporation and its affiliated debtors ask the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division to approve the adequacy of the Disclosure Statement, as well as the solicitation and notice procedures with respect to the confirmation of their proposed joint plan of reorganization. The Debtors propose the following dates and deadlines with respect to confirmation of the Plan: (a) Disclosure Statement Objection Deadline: June 13, 2016 at 5:00 p.m. (b) Disclosure Statement Hearing Date: June 20, 2016 (c) Voting Record Date: June 20, 2016 (d) Solicitation Deadline: Five business days following entry of the Order (e) Publication Deadline: June 27, 2016 (f) Plan Objection Deadline: July 25, 2016 at 5:00 p.m. (g) Voting Deadline: July 26, 2016 at 5:00 p.m. (h) Deadline to File Confirmation Brief: August 2, 2016 at 12:00 p.m. (i) Plan Objection Response Deadline: August 2, 2016 at 12:00 p.m. (j) Deadline to File Voting Report: August 2, 2016 at 12:00 p.m. (k) Confirmation Hearing Date: August 4, 2016 at 10:00 a.m. The Debtors relate that the Disclosure Statement provides "adequate information" to allow holders of Claims in the Voting Classes to make informed decisions about whether to vote to accept or reject the Plan. The Debtors contend that the Disclosure Statement contains a number of categories of information that courts consider "adequate information". The hearing on the Disclosure Statement and the Solicitation Procedures is scheduled on June 20, 2016 at 2:00 p.m. The deadline for the submission of objections to the Disclosure Statement is June 13, 2016 at 5:00 p.m. The Reorganization Plan Penn Virginia Corporation, et al., filed a Chapter 11 Plan of Reorganization that incorporates terms of a Restructuring Support Agreement negotiated with lenders holding 100 percent of the principal amount of the loans arising under the RBL Facility, and holders of approximately 86 percent of the principal amount of the Notes. According to the Disclosure Statement, the Plan provides that: * Holders of administrative and priority Claims shall be paid in full, in cash on the Effective Date; * Holders of DIP Claims shall receive payment in full, in cash on the Effective Date, funded from cash on hand and the proceeds of the Exit Facility and the Rights Offering; * Holders of Other Secured Claims shall receive such treatment as to render their claims unimpaired; * Holders of RBL Claims shall receive payment in full, in cash on the Effective Date, funded from cash on hand and the proceeds of the Exit Facility and the Rights Offering; * Holders of Note Claims and holders of General Unsecured Claims, collectively, shall each receive their pro rata share of an aggregate of 100% of the New Common Stock on the Effective Date, subject to dilution on account of the Management Incentive Plan Equity, any fees payable in New Common Stock under the terms of the Backstop Commitment Agreement (including the Commitment Premium), and the New Common Stock issued in the Rights Offering; * Holders of Note Claims shall also be entitled to participate in the Rights Offering in accordance with the Backstop Commitment Agreement, the Restructuring Support Agreement, the Plan, and certain Rights Offering Procedures; * All existing Interests in Penn Virginia will be canceled, extinguished, and discharged; and * Intercompany Claims and Interests shall be reinstated or canceled at the Debtors' or the reorganized Debtors' option. A full-text copy of the Disclosure Statement, dated May 12, 2016, is available at https://is.gd/bpgJYl Penn Virginia Corporation and its affiliated debtors are represented by: Edward O. Sassower, Esq. Joshua A. Sussberg, Esq. Brian E. Schartz, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, NY 10022 Telephone: (212)446-4800 Facsimile: (212)446-4900 E-mail: edward.sassower@kirkland.com joshua.sussberg@kirkland.com brian.schartz@kirkland.com - and - James H.M. Sprayregen, Esq. Justin R. Bernbrock, Esq. Benjamin M. Rhode, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Chicago, IL 60654 Telephone: (312)862-2000 Facsimile: (312)862-2200 E-mail: james.sprayregen@kirkland.com justin.bernbrock@kirkland.com benjamin.rhode@kirkland.com - and - Michael A. Condyles, Esq. Peter J. Barrett, Esq. Jeremy S. Williams, Esq. KUTAK ROCK LLP Bank of America Center 1111 East Main Street, Suite 800 Richmond, VA 23219 Telephone: (804)644-1700 Facsimile: (804)783-6192 E-mail: Michael.Condyles@KutakRock.com Peter.Barrett@KutakRock.com Jeremy.Williams@KutakRock.com About Penn Virginia Corporation Based in Radnor, Pennsylvania, Penn Virginia Corporation is an independent oil and gas company engaged in the exploration, development and production of oil, NGLs and natural gas in various domestic onshore regions of the United States, with a primary focus in the Eagle Ford Shale in South Texas. Each of Penn Virginia Corporation, Penn Virginia Holding Corp., Penn Virginia MC Corporation, Penn Virginia MC Energy L.L.C., Penn Virginia MC Operating Company L.L.C., Penn Virginia Oil & Gas Corporation, Penn Virginia Oil & Gas GP LLC, Penn Virginia Oil & Gas LP LLC and Penn Virginia Oil & Gas, L.P. filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case Nos. 16-32395 to 16-32403, respectively) on May 12, 2016. The petitions were signed by Seth R. Bullock as chief restructuring officer. The Debtors have engaged Kirkland & Ellis LLP as counsel, Kutak Rock LLP as local counsel, Jefferies LLC as investment banker, Alvarez & Marsal North America, LLC as restructuring advisor, KPMG LLP as tax advisor and Epiq Bankruptcy Solutions, LLC as notice, claims and balloting agent. PJT Partners is acting as financial advisor and Milbank, Tweed, Hadley & McCloy LLP is acting as legal advisor to the ad hoc committee of noteholders. Opportune LLP is acting as financial advisor and Bracewell LLP is acting as legal advisor to Wells Fargo (as agent) and the RBL lenders. Judge Keith L. Phillips has been assigned the cases. PERPETUAL ENERGY: Moody's Cuts Corporate Family Rating to Caa2 -------------------------------------------------------------- Moody's Investors Service downgraded Perpetual Energy Inc.'s Corporate Family Rating (CFR) to Caa2 from Caa1, Probability of Default Rating (PDR) to Caa2-PD/LD from Caa1-PD, and the senior unsecured notes to Caa3 from Caa2. The Speculative Grade Liquidity Rating was raised to SGL-3 from SGL-4. The rating outlook remains negative. The appending of the PDR with an "/LD" designation indicates limited default, reflecting the recent closing of the company's exchange of approximately $214 million of its senior unsecured notes for 4.4 million Tourmaline Oil Corp (unrated) shares, valued at about C$140 million. Moody's views the exchange as a Distressed Exchange, which is a Default under Moody's definitions. The "/LD" designation will be removed after one business day. "The downgrade reflects the drastic reduction in capital spending to virtually nil leading to continuing production declines, which, with weak AECO natural gas pricing, will hamper cash flow generation," said Paresh Chari, Moody's AVP-Analyst. Downgrades: Issuer: Perpetual Energy Inc. -- Probability of Default Rating, Downgraded to Caa2-PD /LD from Caa1-PD -- Corporate Family Rating, Downgraded to Caa2 from Caa1 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Caa3(LGD4) from Caa2(LGD4) Ratings Raised: Issuer: Perpetual Energy Inc. -- Speculative Grade Liquidity Rating, Raised to SGL-3 from SGL-4 Outlook Actions: Issuer: Perpetual Energy Inc. -- Outlook, Remains Negative RATINGS RATIONALE Perpetual's Caa2 CFR reflects the low cash margins driven by a high percentage of natural gas linked to weak AECO pricing and the drastic cut in capex to almost nil, which will lead to declining production in 2016 and 2017. The very low and unsustainable capital spend is the only way Perpetual can maintain breakeven free cash flow and preserve liquidity. The rating favorably recognizes Perpetual's adequate liquidity profile. In accordance with Moody's Loss Given Default (LGD) Methodology, the C$36 million and C$25 million senior unsecured notes are rated Caa3, one notch below the CFR, due to the amount of priority ranking debt of the C$6 million secured revolver, C$10 million secured margin loan and C$21 million Tourmaline secured share financing. Moody's said, "the SGL-3 Speculative Grade Liquidity Rating reflects adequate liquidity through the first quarter of 2017. At the end of the second quarter of 2016 and pro forma for the swap of C$214 million of senior notes in exchange of 4.4 million Tourmaline shares, Perpetual will have about C$30 million of cash and no availability under its C$6 million revolver. We expect Perpetual will be close to breakeven free cash flow through the first quarter of 2017. We expect Perpetual will be in compliance with its two financial covenants through this period. Perpetual has limited sources of alternate liquidity since it has exhausted most of its Tourmaline shares and sold its gas storage facility. Perpetual's C$36 million and C$25 million senior unsecured notes are due in March 2018 and July 2019, respectively." Moody's said, "the negative outlook reflects our view that Perpetual's capital spend is unsustainable, which leads to production and reserve declines." The ratings could be downgraded if liquidity deteriorates. The ratings could be upgraded if the company has the ability to address its upcoming maturities and if production and reserves cease to decline. Perpetual is a public Calgary, Alberta-based independent exploration and production company with average daily production (net of royalties) of about 17,000 barrels of oil equivalent per day. PIONEER HEALTH: Committee Hires GlassRatner as Financial Advisor ---------------------------------------------------------------- The official committee of unsecured creditors of Pioneer Health Services, Inc. and its affiliates seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to hire GlassRatner Advisory & Capital Group LLC as its financial advisor. The unsecured creditors' committee tapped the firm to provide these services: (a) analyze any liquidation or waterfall analysis prepared by the Debtors; (b) develop a revised liquidation or waterfall analysis and valuation; (c) monitor any sale process of the Debtors, including periodic updates as to the status of specific buyers; (d) analyze the Debtors' operations prior to and after the petition date as the committee deems necessary; (e) analyze the Debtors' financial information prior to and after the petition date, as the committee deems necessary; (f) review the prospects and opportunities for the Debtors as an ongoing business operation; (g) review the financial aspects of any disclosure statement and plan of reorganization or liquidation; (h) negotiate with the Debtors' financial advisor; (i) advise the committee and its counsel on various financial and business matters associated with the Debtors; (j) address any related financial and business issues, as requested by the committee or its counsel; (k) confer with representatives of the committee, the Debtors and their counsel; and (l) report to the committee and its counsel on a regular basis. The hourly rate charged by all GlassRatner professionals assigned to the Debtors is $375. Ronald Glass, a principal at GlassRatner, disclosed in a court filing that the firm does not have an interest materially adverse to the interest of the Debtors' estates. Ronald Glass, Principal GlassRatner Advisory & Capital Group LLC 3445 Peachtree Road, Suite 1225 Atlanta, GA 30326 Tel: (404) 835-8830 Cell: (404) 822-0264 Fax: (678) 904-1991 E-mail: rglass@glassratner.com The committee can be reached through: Darryl S. Laddin, Esq. Sean C. Kulka, Esq. Arnall Golden Gregory LLP 171 17th Street, N.W., Suite 2100 Atlanta, GA 30363-1031 Tel: (404) 873-8500 Fax: (404) 873-8501 E-mail: darrxl.laddin@agg.com sean.kulka@,agg.com - and - James A. McCullough, II, Esq. Brunini, Grantham, Grower & Hewes PLLC The Pinnacle Building, Suite 100 190 East Capitol Street Jackson, MS 39201 Tel: 601-948-3101 Fax: 601-960-6902 Email: jmccullough@brunini.com About Pioneer Health Pioneer Health Services, Inc., and its debtor-affiliates, including Medicomp Inc., filing separate Chapter 11 bankruptcy petitions (Bankr. S.D. Miss. Case No. 16-01119 to 16-01126) on March 30, 2016. The Debtors provide healthcare services to rural communities, and own and manage rural critical access hospitals. Judge Hon. Neil P. Olack presides over the Debtors' cases. The Law Offices of Craig M. Geno PLLC serves as the Debtors' counsel. Pioneer Health Services estimated $10 million to $50 million in both assets and liabilities. The petitions were signed by Joseph S. McNulty III, president. PMT INVESTMENTS: U.S. Trustee Unable to Appoint Committee --------------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of PMT Investments LLC. PMT Investments LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 16-02735) on April 18, 2016. The Debtor is represented by William L Norton III, Esq., at Bradley Arant Boult Cummings LLP. PORTER BANCORP: Shareholders Elect Eight Directors -------------------------------------------------- Porter Bancorp, Inc., announced that its shareholders elected eight directors, approved a non-binding advisory vote on the compensation of the company's executives, approved a proposal to authorize the Company's board of directors to effect, at its discretion, a reverse stock split, and approved the 2016 Omnibus Equity Compensation Plan. In comments made at the meeting, John T. Taylor, president and CEO of Porter Bancorp, Inc., stated, "I would like to thank our shareholders and directors for their continued support. The Company continues to make meaningful progress by returning recently to profitability, reducing non-performing assets, and completing a common equity capital raise just last month. We remain focused on building value as we continue lowering the company's risk profile and delivering quality banking products and services to our customers throughout the Commonwealth of Kentucky." At the meeting, shareholders elected the following as directors to serve for a one-year term: (1) W. Glenn Hogan -- Chairman of Porter Bancorp, Inc. and CEO of Hogan Real Estate, a full service commercial real estate development company headquartered in Louisville, KY (2) Michael T. Levy -- President of Muirfield Insurance LLC of Kentucky, a Lexington, KY based insurance brokerage firm (3) James M. Parsons -- Chief Financial Officer of Ball Homes, LLC, a residential real estate development firm headquartered in Lexington, KY (4) Bradford T. Ray -- Retired Chairman and CEO of Steel Technologies, Inc., a steel processor (5) Marc N. Satterthwaite -- Vice President, Chief of Staff for Brown-Forman Corporation, a diversified producer of fine quality consumer products (6) Dr. Edmond J. Seifried -- Principal Seifried & Brew LLC, a community bank education center in Bethlehem, Pennsylvania, and Professor Emeritus at Lafayette College in Easton, Pennsylvania (7) John T. Taylor -- President and CEO of Porter Bancorp, and President and CEO of PBI Bank (8) Kirk W. Wycoff -- Managing Member of Patriot Financial Partners, L.P., a private equity fund focused on investing in community banks, thrifts and other financial service related companies On May 25, 2016, the board of directors of Porter Bancorp, Inc. adopted an amendment to the Company's articles of incorporation to increase the number of authorized shares of Series G Participating Preferred Shares from 35,200 to 38,000. The increase was made to reserve additional Series G Preferred Shares for issuance pursuant to the Company's Tax Benefits Preservation Plan as a result of the increase in the number of the Company's authorized Non-Voting Common Shares from 7.2 million to 10.0 million shares in April 2016. About Porter Bancorp Porter Bancorp, Inc., is a bank holding company headquartered in Louisville, Kentucky. Through its wholly-owned subsidiary PBI Bank, the Company operates 18 full-service banking offices in 12 counties in Kentucky. Porter Bancorp reported a net loss of $3.21 million on $36.57 million of interest income for the year ended Dec. 31, 2015, compared to a net loss of $11.15 million on $39.51 million of interest income for the year ended Dec. 31, 2014. As of March 31, 2016, Porter Bancorp had $938 million in total assets, $904 million in total liabilities and $34.6 million in total stockholders' equity. The Company's auditor Crowe Horwath, LLP, in Louisville, Kentucky, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that "the Company has incurred substantial losses in 2015, 2014 and 2013, largely as a result of asset impairments resulting from the re-evaluation of fair value and ongoing operating expenses related to the high volume of other real estate owned and non-performing loans. In addition, the Company's bank subsidiary is not in compliance with a regulatory enforcement order issued by its primary federal regulator requiring, among other things, increased minimum regulatory capital ratios as well as being involved in various legal proceedings in which the Company disputes material factual allegations against the Company. Additional losses, adverse outcomes from legal proceedings or the continued inability to comply with the regulatory enforcement order may result in additional adverse regulatory action. These events raise substantial doubt about the Company's ability to continue as a going concern." PREFERRED CONCRETE: Hires O. Allan Fridman as Bankruptcy Counsel ---------------------------------------------------------------- Preferred Concrete & Excavating, Inc., seeks permission from the Northern Distrit of Illinois to employ O. Allan Fridman as bankruptcy counsel. A hearing on the request is set for June 8, 2016 at 10:30 a.m. Mr. Fridman will provide these services: (a) generally administering the Estate on behalf of the Debtor; (b) initiating settlement negotiations with various creditors; (c) preparing monthly operating reports; (d) drafting and receiving approval on its Chapter 11 plan; and (e) other various matters that may arise during the course of this Chapter 11 case. Mr. Fridman will be paid $375 per hour for his services. The Debtor has agreed to pay Mr. Fridman a retainer of $10,000 plus attorney's fees subject to court approval. Mr. Fridman assures the Court that he does not hold nor represent an interest adverse to the estate and is a disinterested person. Mr. Fridman can be reached at: O. Allan Fridman, Esq. 555 Skokie Boulevard Suite 500 Northbrook, IL 60062 Tel: (847) 412-0788 E-mail: allan@fridlg.com Preferred Concrete & Excavating, Inc., is a union concrete contractor engaged in concrete in construction in Northern Illinois and surrounding areas for the past 14 years. The Debtor has approximately 10 employees. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill. Case No. 16-81114) on May 4, 2016. O. Allan Fridman, Esq., at the Law Office of O. Allan Fridman serves as the Debtor's bankruptcy counsel. PREMIER TRANSFER: Seeks to Hire Magee Goldstein as Legal Counsel ---------------------------------------------------------------- Premier Transfer and Storage, Inc. seeks approval from the U.S. Bankruptcy Court for the Western District of Virginia to hire Magee Goldstein Lasky & Sayers, P.C. as its legal counsel. The Debtor tapped the firm to provide these services: (a) provide advice about its powers and duties as debtor-in- possession; (b) advise and consult on the conduct of the Debtor's bankruptcy case; (c) attend meetings and negotiating with representatives of the Debtor's creditors and other parties; (d) take all necessary action to protect and preserve the Debtor's estate, including prosecuting actions on its behalf; (e) prepare legal papers; (f) represent the Debtor in connection with obtaining post- petition financing, if necessary; (g) advise the Debtor in connection with any potential sale of assets; (h) appear before the court; (i) take any necessary action to negotiate, prepare and obtain approval of a Chapter 11 plan; and (j) perform all other necessary legal services, including analyzing the Debtor's leases and contracts, analyzing the validity of liens; and advising the Debtor on corporate and litigation matters. Magee Goldstein attorneys who bill at hourly rates typically ranging from $250 to $375. Paralegal and paraprofessional rate is $100 per hour. Garren Laymon, Esq., an associate attorney at Magee Goldstein, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code, according to court filings. Magee Goldstein can be reached through: Andrew S. Goldstein, Esq. Garren R. Laymon, Esq. Magee Goldstein Lasky & Sayers, P.C. P.O. Box 404 Roanoke, VA 24003-0404 Telephone: (540) 343-9800 Facsimile: (540) 343-9898 Email: agoldstein@mglspc.com About Premier Transfer Premier Transfer and Storage, Inc. sought protection under Chapter 11 of the Bankruptcy Code in the Western District of Virginia (Roanoke) (Case No. 16-70721) on May 23, 2016. The petition was signed by John S. Phillips, president. The case is assigned to Judge Paul M. Black. The Debtor estimated assets of $500,000 to $1 million and debts of $1 million to $10 million. PRODUCTION RESOURCE: S&P Reinstates CCC+ Rating on $250MM Revolver ------------------------------------------------------------------ S&P Global Ratings corrected ratings release by reinstating its 'CCC+' rating on U.S.-based Production Resource Group LLC's (PRG's) $250 million senior secured asset-based lending (ABL) revolver. S&P had withdrawn the rating in error on April 15, 2016. RATINGS LIST Production Resource Group Inc. Corporate Credit Rating CCC-/Negative/-- Rating Reinstated Production Resource Group (Europe) Ltd. Production Resource Group Canada Ltd. Production Resource Group LLC Senior Secured $250 million asset-based lending revolver CCC+ Recovery Rating 1 QRS RECYCLING: Hires Bingham Greenebaum as Counsel -------------------------------------------------- QRS Recycling of Georgia, LLC, seeks authority from the U.S. Bankruptcy Court for the Northern District of Georgia to employ Bingham Greenebaum Doll LLP as counsel to the Debtor. QRS Recycling requires BGD to: a. advise the Debtor of its rights, powers and duties as a debtor in possession while operating and managing its business and property under chapter 11 of the Bankruptcy Code; b. prepare on behalf of the Debtor all necessary and appropriate applications, motions, proposed orders, other pleadings, notices, schedules and other documents, and reviewing all financial and other reports to be filed in the Chapter 11 Case; c. advise the Debtor concerning, and prepare responses to, applications, motions, other pleadings, notices and other papers that may be filed by other parties in the Chapter 11 Case; d. advise the Debtor with respect to, and assist in the negotiation and documentation, of, financing agreements and related transactions; e. review the nature and validity of any liens asserted against the Debtor's property and advising the Debtor concerning the enforceability of such liens; f. advise the Debtor regarding its ability to initiate actions to collect and recover property for the benefit of its bankruptcy estates, provided, however, that BGD will not represent the Debtor or the Non-Debtor Affiliates in connection with any intercompany claims; g. advise and assist the Debtor in connection with any potential property dispositions; h. advise the Debtor concerning executory contract and unexpired lease assumptions, assignments and rejections; i. advise the Debtor in connection with the formulation, negotiation and promulgation of a plan or plans of liquidation, and related transactional documents; j. assist the Debtor in reviewing, estimating and resolving claims asserted against the Debtor's bankruptcy estate; k. commence and conduct litigation necessary and appropriate to assert rights held by the Debtor, protect assets of the Debtor's bankruptcy estate or otherwise further the goal of completing the Debtor's successful reorganization; and l. provide non-bankruptcy services for the Debtor to the extent requested by the Debtor. BGD will be paid at these hourly rates: James R. Irving, Partner $325 Brian D. Zoeller, Partner $300 April A. Wimberg, Associate $215 Susan H. Mays, Paralegal $225 BGD will be paid a retainer in the mount of $10,000. The retainer funding was paid by using the Debtor's cash, although that cash was previously held by non-debtor affiliate QRS, Inc. on account of the Debtor's cash management system whereby QRS, Inc. acts as collecting agent for much of the Debtor's accounts receivable. BGD has not received any payment or compensation from the Debtor aside from the retainer. However, BGD has received other payment and compensation from the Debtor's non-debtor affiliates for whom BGD has performed work and continues to perform work. BGD will also be reimbursed for reasonable out-of-pocket expenses incurred. James Irving, partner in the law firm of Bingham Greenebaum Doll LLP, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. BGD can be reached at: James R. Irving, Esq. BINGHAM GREENEBAUM DOLL LLP 3500 National City Tower 101 South Fifth Street Louisville, KY 40202 Tel: (502) 587-3606 Fax: (502) 540-2215 E-mail: jirving@bgdlegal.com About QRS Recycling QRS Recycling of Georgia, LLC, operator of a recycling facility located at 120 Hollow Tree Lane SW, Atlanta, Georgia, filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 16-58837) on May 20, 2016, to liquidate its assets. The case is pending before Judge James R. Sacca. DLA Piper LLP (US) and Bingham Greenbaum Doll LLP represent the Debtor as counsel. Upshot Services LLC serves as the Debtor's claims and noticing agent. The Debtor estimated assets of up to $10 million and liabilities in the range of $10 million to $50 million. QRS RECYCLING: Hires UpShot as Claims Agent ------------------------------------------- QRS Recycling of Georgia, LLC, seeks authority from the U.S. Bankruptcy Court for the Northern District of Georgia to employ UpShot Services LLC as noticing, claims and balloting agent to the Debtor. QRS Recycling requires UpShot to: a. prepare and serve required notices and documents in the Chapter 11 Case in accordance with the Bankruptcy Code and the Bankruptcy Rules in the form and manner directed by the Debtor and/or the Court including, (i) notice of the commencement of the Chapter 11 Case and the initial meeting of creditors under Bankruptcy Code § 341(a), (ii) notice of any claims bar date, (iii) notices of transfers of claims, (iv) notices of objections to claims and objections to transfers of claims, (v) notices of any hearings on a disclosure statement and confirmation of the Debtor's plan or plans of liquidation, including under Bankruptcy Rule 3017(d), (vi) notice of the effective date of any plan and (vii) all other notices, orders, pleadings, publications and other documents as the Debtor or Court may deem necessary or appropriate for an orderly administration of the Chapter 11 Case; b. maintain an official copy of the Debtor's Schedules of Assets & Liabilities and Statement of Financial Affairs (together, the "Schedules") listing the Debtor's known creditors and the amounts owed thereto; c. maintain (i) a list of all potential creditors, equity holders and other parties-in-interest; and (ii) a "core" mailing list consisting of all parties described in sections 2002(i), (j) and (k) and those parties that have filed a notice of appearance pursuant to Bankruptcy Rule 9010; update said lists and make said lists available upon request by a party-in-interest or the Clerk; d. furnish a notice to all potential creditors of the last date for the filing of proofs of claim and a form for the filing of a proof of claim, after such notice and form are approved by this Court, and notify said potential creditors of the existence, amount and classification of their respective claims as set forth in the Schedules, which may be effected by inclusion of such information (or the lack thereof, in cases where the Schedules indicate no debt due to the subject party) on a customized proof of claim form provided to potential creditors; e. maintain a post office box or address for the purpose of receiving claims and returned mail, and process all mail received; f. for all notices, motions, orders or other pleadings or documents served, prepare and file or caused to be filed with the Clerk an affidavit or certificate of service within seven (7) business days of service which includes (i) either a copy of the notice served or the docket numbers(s) and title(s) of the pleading(s) served, (ii) a list of persons to whom it was mailed (in alphabetical order) with their addresses, (iii) the manner of service, and (iv) the date served; g. process all proofs of claim received, including those received by the Clerk's Office, and check said processing for accuracy, and maintain the original proofs of claim in a secure area; h. maintain the official claims register for the Debtor (the "Claims Register") on behalf of the Clerk; upon the Clerk's request, provide the Clerk with certified, duplicate unofficial Claims Register; and specify in the Claims Register the following information for each claim docketed: (i) the claim number assigned, (ii) the date received, (iii) the name and address of the claimant and agent, if applicable, who filed the claim, (iv) the amount asserted, (v) the asserted classification(s) of the claim (e.g., secured, unsecured, priority, etc.), (vi) the Debtor, and (vii) any disposition of the claim; i. implement necessary security measures to ensure the completeness and integrity of the Claims Register and the safekeeping of the original claims; j. record all transfers of claims and provide any notices of such transfers as required by Bankruptcy Rule 3001(e); k. relocate, by messenger or overnight delivery, all of the court-filed proofs of claim to UpShot's offices, not less than weekly; l. perform and assist the Debtor and its retained professionals with such other tasks, duties and projects they deem necessary to the overall operation of the Chapter 11 Case; m. upon completion of the docketing process for all claims received to date for each case, turn over to the Clerk copies of the claims register for the Clerk's review (upon the Clerk's request); n. monitor the Court's docket for all notices of appearance, address changes, and claims-related pleadings and orders filed and make necessary notations on and/or changes to the claims register; o. assist in the dissemination of information to the public and respond to requests for administrative information regarding the Chapter 11 Case as directed by the Debtor or the Court, including through the use of a case website and/or call center; p. if the Chapter 11 Case are converted to chapter 7, contact the Clerk's Office within three (3) days of the notice to UpShot of entry of the order converting the Chapter 11 Case; q. thirty (30) days prior to the close of the Chapter 11 Case, to the extent practicable, request that the Debtor submit to the Court a proposed Order dismissing UpShot and terminating the services of such agent upon completion of its duties and responsibilities and upon the closing of the Chapter 11 Case; r. within seven (7) days of notice to UpShot of entry of an order closing the Chapter 11 Case, provide to the Court the final version of the claims register as of the date immediately before the close of the cases; and s. at the close of the Chapter 11 Case, box and transport all original documents, in proper format, as provided by the Clerk's Office, to (i) the Federal Archives Record Administration or (ii) any other Location requested by the Clerk's Office. UpShot will be paid at these hourly rates: Clerical $25 Case Assistant $60 IT Manager $125 Case Consultant $150 Case Director $170 UpShot will be paid a retainer in the amount of $3,000. UpShot will also be reimbursed for reasonable out-of-pocket expenses incurred. Travis Vandell, managing director of UpShot Services LLC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. UpShot can be reached at: Travis Vandell UPSHOT SERVICES LLC 8269 E. 23 rd Avenue, Suite 275 Denver, CO 80238 Tel: (855) 812-6112 E-mail: tvandell@upshotservices.com About QRS Recycling QRS Recycling of Georgia, LLC, operator of a recycling facility located at 120 Hollow Tree Lane SW, Atlanta, Georgia, filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 16-58837) on May 20, 2016, to liquidate its assets. The case is pending before Judge James R. Sacca. DLA Piper LLP (US) and Bingham Greenbaum Doll LLP represent the Debtor as counsel. Upshot Services LLC serves as the Debtor's claims and noticing agent. The Debtor estimated assets of up to $10 million and liabilities in the range of $10 million to $50 million. QUANTUM MATERIALS: Enters Next Phase of Quantum Dot Development --------------------------------------------------------------- Quantum Materials Corp announced that it has completed the initial development phase with its display film partners and is entering a pre-production phase in which the Company has committed to an accelerated sample optimization and delivery schedule for its cadmium-free quantum dots. Quantum Materials has begun shipping additional deliveries of cadmium-free quantum dot samples to its partners and is scheduled to increase shipment quantities as development reaches pre-commercial scale later this year. The Company anticipates that, in conjunction with its partners, commercial quantities of a high performance cadmium-free quantum dot film will be available to display manufacturers in early 2017. Increasing concern over the use of cadmium in consumer displays has been driven by RoHS Directives and heightened corporate environmental responsibility, resulting in significant interest from the display industry in a cadmium-free quantum dot display film. "Our decision to accelerate development of cadmium-free quantum dots and our ability to recruit a distinguished scientific, technical and production team has allowed us to achieve this milestone and initiate ramping-up of sample production volumes," said Stephen Squires, president and CEO of Quantum Materials Corp. "The revolutionary nature of our high-volume production process is recognized by our esteemed customers and partners and has allowed us to attract talented employees on the cutting edge of the nano-sciences. On a daily basis the Quantum Materials' team is accelerating discovery and fast-tracking significant advances in material science." Quantum Materials will be participating at the Society for Information Display (SID) 'Display Week 2016 International Symposium, Seminar and Exhibition' from May 22-May 27, 2016, at the Moscone Convention Center in San Francisco, California. Quantum Materials will be exhibiting in partnership with Uniglobe Kisco Inc. (www.uniglobe-kisco.com) at Booth 1342 and Mr. Squires will be participating in a CMO panel discussion on Wednesday morning at 8:30am in Room 123. "We value our relationship with Kisco and look forward to working with them at DisplayWeek to continue growing the current customer partnerships they have facilitated and build upon the momentum we are developing as a team," Mr. Squires concluded. About Quantum Materials Quantum Materials Corp. and its wholly owned subsidiary, Solterra Renewable Technologies, Inc. (collectively referred to as the company) are headquartered in San Marcos, Texas. The company specializes in the design, development, production and supply of quantum dots, including tetrapod quantum dots, a high performance variant of quantum dots, and highly uniform nanoparticles, using its patented automated continuous flow production process. As of March 31, 2016, Quantum had $1.06 million in total assets, $1.48 million in total liabilities, and a total stockholders' deficit of $419,000. Weaver and Tidwell, L.L.P., in an October 13, 2015 report addressed to the board of directors and stockholders of Quantum Materials Corp., expressed substantial doubt about the company's ability to continue as a going concern. The firm audited the consolidated balance sheets of the company as of June 30, 2015 and 2014, and the related consolidated statements of operations, stockholders' equity (deficit), and cash flows for each of the years in the two-year period ended June 30, 2015. The independent auditor noted that the Company has suffered recurring losses from operations and has an accumulated deficit that raises substantial doubt about its ability to continue as a going concern. QUINN'S JUNCTION: Seeks to Hire RMA as Accountant ------------------------------------------------- Quinn's Junction Properties, LC seeks approval from the U.S. Bankruptcy Court for the District of Utah to hire Rocky Mountain Advisory, LLC as its accountant and financial advisor. The Debtor tapped the firm to provide these services: (a) provide accounting assistance in the preparation of monthly financial reports required to be filed with the court; (b) provide assistance in connection with the Debtor's reorganization and other business matters; (c) prepare any necessary financial projections; and (d) advise the Debtor on any other financial matters. RMA will charge the Debtor for its services on an hourly basis. The firm's hourly rates range from $125 to $380, although it RMA regularly adjusts its rates based on increasing experience and market conditions. Gil Miller, senior managing director of RMA, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Gil A. Miller Rocky Mountain Advisory LLC 215 South State Street, Suite 550 Salt Lake City, Utah 84111. The Debtor can be reached through its counsel: George B. Hofmann, Esq. Cohne Kinghorn PC 111 East Broadway, 11th Floor Salt Lake City, UT 84111 Tel: (801) 363-4300 Fax: (801) 363-4378 Email: ghofmann@cohnekinghorn.com About Quinn's Junction Quinn's Junction Properties, LC sought protection under Chapter 11 of the Bankruptcy Code in the District of Utah (Salt Lake City) (Case No. 16-24458) on May 23, 2016. The petition was signed by Michael Martin, chief restructuring officer. George B. Hofmann, Esq., at Cohne Kinghorn PC, serves as the Debtor's general bankruptcy counsel. Stanley J. Preston, Esq., at Preston & Scott, LLC, serves as its special litigation counsel. The case is assigned to Judge Joel T. Marker. The Debtor estimated both assets and liabilities in the range of $10 million to $50 million. RBK TRUCKING: Hires Burgess as Counsel -------------------------------------- R.B.K. Trucking, Inc., seeks authority from the U.S. Bankruptcy Court for the Middle District of Florida to employ Jason A. Burgess as Counsel to the Debtor. R.B.K. Trucking requires Burgess to: a. give advice to the Debtor with respect to its powers and duties as debtor-in-possession and the continued management of its business; b. advise the Debtor with respect to its responsibilities in complying with the US Trustee's Operating Guidelines and Reporting Requirements and with the Local Rules of this Court; c. prepare motions, pleadings, orders, applications, disclosure statements, plans of reorganization, commence adversary proceedings, and prepare other such legal documents necessary in the administration of this case; d. protect the interest of the Debtor in all matters pending before the Court; and e. represent the Debtor in negotiations with their creditors and in preparation of the disclosure statement and plan of reorganization. Burgess will be paid at these hourly rates: Jason A. Burgess $295 Associate $195 Paralegal $75 Prior to the Petition Date, the Debtor and Jason A. Burgess agreed to a minimum fee for representation, in the amount of $7,000. Burgess acknowledges receipt of the $7,000.00, and that $1,717.00 was paid on behalf of the Debtor for the $1,717.00 filing fee required to commence this Chapter 11 bankruptcy case. Jason A. Burgess, Esq., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Burgess can be reached at: Jason A. Burgess, Esq. 1855 Mayport Road Atlantic Beach, FL 32233 Tel: (904) 372-4791 Fax: (904) 853-6932 R.B.K. Trucking, Inc. filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 3:16-bk-01898) on May 20, 2016. REALOGY GROUP: Moody's Rates New Sr. Unsecured Notes 'B2' --------------------------------------------------------- Moody's Investors Service rated Realogy Group LLC's proposed senior unsecured notes at B2. The net proceeds raised from the new bond will be used to reduce loans currently outstanding under the senior secured revolving credit facility and to add cash to the balance sheet. Realogy also announced that it plans to extend the maturity date on its senior secured term loan B while reducing its size. Earlier this month, Realogy repaid $500 million of maturing 3.375% senior unsecured notes funded with borrowings under the revolving credit facility and cash on hand. Issuer: Realogy Group LLC Assignment: -- Senior Unsecured Bond due 2023, Assigned B2 (LGD5) Revision: -- Senior Secured LGD Assessment, Updated to LGD2 from LGD3 RATINGS RATIONALE "The proposed note transaction is credit neutral and liquidity positive as it in effect refinances the $500 million of senior unsecured notes that were repaid in May 2016 with new debt that matures in 7 years while increasing revolver capacity to the full $815 million commitment," noted Edmond DeForest, Moody's Senior Credit Officer. DeForest continued: "If the company follows through on its announced plan to reduce its Term Loan B, the resulting decline in the proportion of senior secured debt to total debt could lead Moody's to raise the senior secured credit ratings to Ba2 from Ba3 or upgrade the senior unsecured to B1 from B2." The Ba3 Corporate Family Rating reflects Moody's expectations for solid ongoing financial performance and rapid financial deleveraging through debt repayment and EBITDA growth. Realogy has a leading 27% economic participation rate in the value of the US existing residential home sale market and multiple brands that position it to reflect the continuing, albeit slow and uneven, recovery in the market. However, Realogy remains highly leveraged at about 5 times debt to EBITDA as of March 31, 2016, although leverage should decline below 4.5 times by the end of 2016. The residential real estate brokerage market remains volatile, cyclical and seasonal. Realogy's owned brokerages have a high degree of fixed operating costs. A high proportion of its profits reflect home sale market activity as opposed to less-transactional franchise fees. Difficult credit conditions for first time home buyers continue to limit the scope of the residential real estate recovery to more affluent buyers and markets. Realogy has the potential for higher EBITDA growth if credit conditions for first time home buyers improve. The stable ratings outlook reflects Moody's anticipation that debt to EBITDA will decline to below 4.5 times by the end of 2016 through EBITDA growth and debt repayment, while free cash flow to debt will be maintained around 10%. The ratings could be upgraded if Moody's comes to expect debt to EBITDA to be sustained below 4 times and EBITA to interest around 3 times through some combination of rising existing unit home sales and average prices or accelerated debt repayments. The ratings could be downgraded if revenue growth stalls, or if free cash flow declines and Moody's anticipates debt to EBITDA will remain above 5 times or free cash flow to debt will remain below 8%. Aggressive financial policies including large debt financed shareholder returns or acquisitions or diminished liquidity could also lead to lower ratings. Realogy is a leading global provider of real estate and relocation services. The company operates in four segments: real estate franchise services, company owned real estate brokerage services, relocation services and title and settlement services. The franchise brand portfolio includes Century 21, Coldwell Banker, Coldwell Banker Commercial, ERA, Sotheby's International Realty and Better Homes and Gardens Real Estate. Moody's expects 2016 revenues of over $6 billion. REALOGY GROUP: S&P Assigns 'B' Rating on Proposed $500MM Notes -------------------------------------------------------------- S&P Global Ratings assigned its 'B' issue-level rating and '6' recovery rating to Realogy Group LLC's and co-issuer and wholly owned subsidiary Realogy Co-Issuer Corp.'s proposed $500 million senior unsecured notes due 2023. The '6' recovery rating reflects S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. S&P placed the 'B' issue-level rating on the proposed notes on CreditWatch with positive implications. In addition, S&P affirmed its 'B' issue-level rating, with a '6' recovery rating, on Realogy's existing senior unsecured notes due 2019 and 2021, and placed the 'B' issue-level rating on CreditWatch with positive implications. S&P also affirmed its 'BB+' issue-level rating on the company's senior secured debt. The recovery rating remains '1', reflecting S&P's expectation for significant recovery (90%-100%) of principal for lenders in the event of a payment default. S&P's 'BB-' corporate credit rating and stable outlook on Realogy Group LLC are unchanged. Realogy plans to use the proceeds from the proposed notes due 2023 to repay outstanding borrowings under the company's revolving credit facility and for general corporate purposes, and Realogy has stated its intention over the near term to extend the maturity date of its existing senior secured term loan B due 2020 and reduce the outstanding principal under the secured facility. While the company will initially use the proposed unsecured notes issuance primarily to pay down revolver balances, the CreditWatch positive listing on the senior unsecured debt ratings reflects S&P's belief that it is likely that the company will use availability under the revolver after the close of the proposed notes to reduce the senior secured term loan B by a sufficient amount to improve recovery prospects for unsecured lenders enough to warrant an upward revision to the senior unsecured recovery rating to '5' from '6', and to raise the issue-level rating on all senior unsecured debt one notch to 'B+' from 'B'. S&P expects to resolve the CreditWatch listing on the unsecured debt rating following Realogy's planned near-term reduction of its senior secured term loan B due 2020. Under S&P's simulated default assumptions, its enterprise valuation on Realogy is unchanged. S&P values Realogy based on a $400 million level of EBIDTA at emergence, with a 7x multiple, arriving at a net enterprise valuation (after 5% administrative costs) of $2.7 billion. RATINGS LIST Realogy Group LLC Corporate Credit Rating BB-/Stable/-- Rating Assigned and Placed On CreditWatch Realogy Group LLC Realogy Co-Issuer Corp. $500 mil. notes due 2023 Senior Unsecured B/Watch Pos Recovery Rating 6 Rating Affirmed And Placed on CreditWatch; Recovery Rating Unchanged Realogy Group LLC Senior Unsecured B/Watch Pos Recovery Rating 6 Rating Affirmed; Recovery Rating Unchanged Realogy Group LLC Senior Secured BB+ Recovery Rating 1 REALOGY HOLDINGS: Prices $500 Million Offering of Senior Notes -------------------------------------------------------------- Realogy Holdings Corp. announced that its indirect, wholly-owned subsidiary, Realogy Group LLC, together with a co-issuer, priced $500 million aggregate principal amount of 4.875% senior notes due 2023 at the initial offering price of 99.269% of the principal amount in a private offering that is exempt from the registration requirements of the Securities Act of 1933, as amended. The closing of the offering is expected to occur on June 1, 2016, subject to customary closing conditions. The Notes will be guaranteed on an unsecured senior basis by each of Realogy Group's domestic subsidiaries (other than the co-issuer of the Notes) that is a guarantor under its senior secured credit facilities and its outstanding securities. The Notes will also be guaranteed by the Company on an unsecured senior subordinated basis. The Notes will be effectively subordinated to all of Realogy Group's existing and future senior secured debt, including its senior secured credit facilities, to the extent of the value of the assets securing such debt. The Company intends to use a portion of the net proceeds from this offering to reduce outstanding borrowings under its revolving credit facility and the remaining proceeds for general corporate purposes, which may include additional debt transactions. The Company continues to evaluate a potential debt transaction in which the Company would extend the maturity date on its Term Loan B facility and reduce the outstanding principal amount under such facility. There can be no assurances that the Company will be able to complete any such transaction on acceptable terms or at all, and its ability to do so will depend upon numerous factors such as market conditions, many of which are outside the Company's control. The Notes and the related guarantees will not be registered under the Securities Act or any state securities law and may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and applicable state securities laws. The Notes and the related guarantees will be offered only to persons reasonably believed to be qualified institutional buyers under Rule 144A of the Securities Act and outside the United States under Regulation S of the Securities Act. About Realogy Holdings Corp. Realogy Holdings Corp. (NYSE: RLGY) is a global leader in residential real estate franchising with company-owned real estate brokerage operations doing business under its franchise systems as well as relocation and title services. Realogy's brands and business units include Better Homes and Gardens(R) Real Estate, CENTURY 21(R), Coldwell Banker(R), Coldwell Banker Commercial(R), The Corcoran Group(R), ERA(R), Sotheby's International Realty(R), NRT LLC, Cartus and Title Resource Group. Collectively, Realogy's franchise system members operate approximately 13,500 offices with 251,000 independent sales associates doing business in 104 countries around the world. Realogy is headquartered in Madison, N.J. Realogy Holdings reported net income attributable to the Company of $143 million on $5.32 billion of net revenues for the year ended Dec. 31, 2014, compared to net income attributable to the Company of $438 million on $5.28 billion of net revenues during the prior year. As of March 31, 2016, Realogy Holdings had $7.40 billion in total assets, $5.04 billion in total liabilities and $2.35 billion in total equity. * * * In the Aug. 1, 2013, edition of the TCR, Moody's Investors Service upgraded the corporate family rating of Realogy Group to to B2 from B3. The upgrade to B2 CFR is driven by expectations for ongoing strong financial performance, supported by Realogy's recently-concluded debt and equity financing activities and a continuing recovery in the US existing home sale market. As reported by the TCR on Feb. 18, 2013, Standard & Poor's Ratings Services raised its corporate credit rating on Realogy Corp. to 'B+' from 'B'. "The one notch upgrade in the corporate credit rating to 'B+' reflects an increase in our expectation for operating performance at Realogy in 2013, and S&P's expectation that total lease adjusted debt to EBITDA will improve to the low-6x area and funds from operations (FFO) to total adjusted debt will be improve to the high-single-digits percentage area in 2013, mostly due to EBITDA growth in the low- to mid-teens percentage area in 2013," S&P said. REGAL ENTERTAINMENT: Moody's Assigns Ba1 Rating on Proposed Loan ---------------------------------------------------------------- Moody's Investors Service has assigned a Ba1 rating to Regal Entertainment Group's wholly-owned subsidiary Regal Cinemas Corporation's proposed senior secured term loan. The proceeds from the issuance will be used to repay the existing senior secured term loan outstanding at Regal. Moody's expects the transaction will reduce the interest rate spread over LIBOR from 300 basis points to 275 basis points, resulting in annual interest savings of around $2.5 million. The transaction will not change the amount of absolute debt at Regal. The company's B1 Corporate Family Rating (CFR) and stable outlook remain unchanged. Assignments: Issuer: Regal Cinemas Corporation Senior Secured Bank Credit Facility, Assigned Ba1 (LGD2) RATINGS RATIONALE Regal's B1 CFR incorporates the company's liberal use of operating cash flow and the constraints imposed by a mature industry experiencing a secular decline in attendance. Additionally, the company is challenged by a dependence on a limited number of movie studios, an unpredictable box office result, and emerging competitive threats. Supporting the rating is its size and scale, as well as barriers to entry into the first-run window for theatrical distribution. The company also has strong pricing power, high margins, and good liquidity. The principal methodology used in this rating was Business and Consumer Service Industry published in December 2014. Regal Entertainment Group, headquartered in Knoxville, Tennessee and the parent of Regal Cinemas Corporation, operates 7,329 screens in 567 theatres, primarily in mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout 42 states in the US, along with Guam, Saipan, American Samoa and the District of Columbia. Revenue for the twelve months ended March 31, 2016, was approximately $3.2 billion and associated attendance was approximately 219 million. REGATTA CONSTRUCTION: Hires Riley & Dever as Chapter 11 Counsel --------------------------------------------------------------- Regatta Construction, Inc., et al., seek authority from the U.S. Bankruptcy Court for the District of Massachusetts to employ George J. Nader, of Riley & Dever, P.C. as counsel to the Debtors. Regatta Construction requires Nader to: (a) assist the Debtors in preparing schedules, statement of financial affairs and related documents with the court; (b) employ professionals to assist in the reorganization of the Debtors; (c) effectuate a reorganization of the Debtors' estates by filing the appropriate plans of reorganizations and disclosure statements, including any amendments thereto, and defending against any motions to dismiss and/or for relief from the stay; (d) assist the Debtors in complying with Chapter 11 reporting and operations requirements, including filing necessary reports; (e) negotiate with creditors for adequate protection and the use of cash collateral, assumption or rejection of leases and/or executory contracts, objection to claims and related issues. Nader will be paid $350 per hour. Nader will be paid a retainer in the amount of $5000, from each of the Debtors for a total retainer of $10,000 for both Chapter 11 cases. Nader will also be reimbursed for reasonable out-of-pocket expenses incurred. George J. Nader of Riley & Dever, P.C., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Nader can be reached at: George J. Nader, Esq. RILEY & DEVER, P.C. Lynnfield Woods Office Park 210 Broadway, Suite 101 Lynnfield, MA 01940-2351 Tel: (781) 581-9880 Fax: (781) 581-7301 E-mail: nader@rileydever.com About Regatta Construction Regatta Construction, Inc., et al. filed for Chapter 11 protection (Bankr. D. Mass. Case No. 16-11885) on May 18, 2016. The petition was signed by Christian Tosi, president. The Hon. Frank J. Bailey presides over the case. The Debtor estimated assets of $1 million to $10 million and estimated liabilities of $0 to $50,000. RELATIVITY MEDIA: Netflix Loses Bid for Advance Release of Films ---------------------------------------------------------------- Tom Corrigan, writing for Daily Bankruptcy Review, reported that a bankruptcy judge on May 27 delivered a defeat to Netflix Inc., which has fought for the right to release two films produced by Relativity Media LLC on its streaming platform ahead of their expected theatrical release. According to the report, Judge Michael Wiles of the U.S. Bankruptcy Court in Manhattan issued an order forbidding Netflix to release the films, saying a premature debut of the movies could prove "devastating" for the Hollywood studio that he released from chapter 11 earlier this year. Relativity's fragile reorganization plan is dependent upon the theatrical release of its most anticipated films: "Masterminds," a comedy starring Zach Galifianakis and Kristen Wiig, and "The Disappointments Room," a horror film starring Kate Beckinsale, the report related. "It is my responsibility to ensure the plan I approved is carried out," the judge said in court on May 27, the report further related. Allowing Netflix to proceed "would threaten the bankruptcy process…with devastating consequences to the plan and distributions" to creditors, the report added. About Relativity Fashion 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 (Bankr. S.D.N.Y. Case No. 15-11989) on July 30, 2015. 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, assisted the Debtors in raising up to $100 million of new equity to fund the Plan. The Bankruptcy Court on Feb. 8, 2016 confirmed the Debtors' Fourth Amended Plan. A copy of the Fourth Amended Plan is available at http://is.gd/wZI1gd ROCKIES EXPRESS: S&P Affirms 'BB+' CCR & Revises Outlook to Neg. ---------------------------------------------------------------- S&P Global Ratings said that it affirmed its 'BB+' corporate credit and senior unsecured debt ratings on Rockies Express Pipeline LLC (REX). S&P has revised the outlook to negative from stable. The '4' recovery rating on the senior unsecured notes is unchanged and reflects S&P's expectation for average (30% to 50%; in the upper half of the range) recovery of a payment default occurs. "The rating action reflects the impact the recent Encana contract renegotiation is expected to have on near-term credit metrics," said S&P Global Ratings credit analyst Mike Llanos. Encana has amended the terms of the contract by reducing the rate to transport gas from $0.986 per dekatherm (dth) to $0.373/dth in 2016, $0.25/dth in 2017 (through Feb. 28, 2019), and then increasing to $0.794/dth until the contract expires in 2024. Offsetting this is REX's ability to extend the tenure of these contracts through 2024, which improves the weighted average length of the contracts and mitigates a large percentage of the cash flow cliff risk associated with the legacy west-to-east volumes in 2019. Further compounding near-term credit measures is the loss of revenues associated with Ultra Resources Inc., which filed for bankruptcy protection and breached its contract for committed volumes with the pipeline. As management continues to take steps to stagger the cash flow cliff associated with the legacy west-to-east volumes (which now makes up roughly 35% of 2019 revenues), S&P believes additional contracts will be renegotiated at similar rates before they expire resulting in adjusted leverage that exceeds 4.5x. Though the "Power-Up" (capacity enhancement across zone 3) project is expected to offset the lost cash flows from the Encana renegotiation in 2017 and beyond, 2017 leverage is forecasted to be roughly 4.25x. Most of the newer contracts are tied to producers that lack the strong credit quality of the legacy west-to-east volume flow. For 2016, roughly 33% of total revenues are derived from speculative-grade shippers. The inability of these weaker counterparties to meet their contractual arrangements could lead to credit measures that are materially worse than S&P's expectations if management is unable to replace those potential lost volumes. The negative outlook reflects S&P's expectation that near-term adjusted debt leverage will be pressured by the Encana contract renegotiation, resulting in 2016 adjusted debt leverage of about 4.75x. While S&P expects REX to maintain adequate liquidity and complete growth projects on time and on budget, the pipeline also has a higher level of exposure to weaker counterparties and the potential exists that additional west-to-east contracts are renegotiated at materially lower rates, resulting in leverage exceeding 4.75x. ROCKIES REGION: PwC Expresses Concern Doubt ------------------------------------------- Rockies Region 2006 Limited Partnership posted a net loss of $92,005 for the quarterly period ended March 31, 2016, down from a net loss of $3,427,051 for the same period a year ago, according to Rockies Region's Form 10-Q Report filed May 13. Rockies Region said revenues from crude oil, natural gas and NGLs sales total $178,111 for the quarter, compared to $143,059 for the same quarter in 2015. At March 31, 2016, Rockies Region had total assets of $1,056,966 against total liabilities of $2,406,069 and total Partners' deficit of $1,349,103. A copy of the Quarterly Report is available at https://is.gd/jiw93u The Partnership posted a net loss of $5,160,058 for the year ended December 31, 2015, compared to a net loss of $36,874,000 for 2014. Revenues from crude oil, natural gas and NGLs sales were $779,509 for 2015 compared to $1,445,976 for 2014. A copy of the 2015 Annual Report is available at https://is.gd/8z5VPr The Partnership noted in its Form 10-Q report that the market price for crude oil, natural gas and NGLs decreased significantly during 2015 and continued to be depressed during the three months ended March 31, 2016. Although its production increased 65% during the three months ended March 31, 2016 as compared to the comparable prior year period, as a result of the continued depressed commodity prices, the Partnership generated modest revenue of $178,000 during the three months ended March 31, 2016. Further, there was no improvement in the Partnership's liquidity during the three months ended March 31, 2016 as cash flows generated from crude oil, natural gas and NGLs sales were utilized for operating activities. The Partnership said that its strained liquidity position resulting from declining commodity prices raises substantial doubt about its ability to continue as a going concern. Due to the significant decrease in liquidity experienced in 2015 that has continued into 2016 and anticipated future capital expenditures required to remain in compliance with certain regulatory requirements and to satisfy asset retirement obligations, the Managing General Partner believes that cash flows from operations will be insufficient to meet the Partnership's obligations. One of the Partnership's most significant obligations is to the Managing General Partner, which is currently due for reimbursement of costs paid on behalf of the Partnership by the Managing General Partner. Such amounts are generally paid to third parties for general and administrative expenses and equipment and operating costs, as well as monthly operating fees payable to the Managing General Partner. Starting in the second quarter of 2015 and continuing during the three months ended March 31, 2016, the Partnership made no quarterly cash distributions to the Managing General Partner or Investor Partners. The ability of the Partnership to continue as a going concern is dependent upon its ability to attain a satisfactory level of cash flows from operations. Greater cash flow would most likely occur from improved commodity pricing and, to a lesser extent, a sustained increase in production. However, historically, as a result of the normal production decline in a well's production life cycle, the Partnership has not experienced a sustained increase in production without capital expenditures. The Managing General Partner is considering various options to mitigate risks that raise substantial doubt about the Partnership’s ability to continue as a going concern, including, but not limited to, deferral of payment of certain obligations, continued suspension of distributions to partners, partial or complete sale of assets and the shutting-in of wells. However, there can be no assurance that the Partnership will be able to mitigate such conditions. Failure to do so could result in a partial asset sale or some form of bankruptcy, liquidation or dissolution of the Partnership. PricewaterhouseCoopers LLP, in Denver, Colorado, which audited Rockies Region's annual report, noted that the negative impact to the Partnership's liquidity resulting from declining commodity prices raises substantial doubt about its ability to continue as a going concern. Rockies Region 2006 Limited Partnership was organized in 2006 as a limited partnership, in accordance with the laws of the State of West Virginia, for the purpose of engaging in the exploration and development of crude oil and natural gas properties. ROLLING LANDS: Seeks to Hire Wyatt as Legal Counsel --------------------------------------------------- Rolling Lands Investments, LC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire The Law Offices of Donald L. Wyatt Jr., PC as its legal counsel. The firm's standard hourly rates range from $85 for a paralegal and law clerk to $600 for shareholder attorneys. Wyatt will seek reimbursement of its work-related expenses. Donald Wyatt, a managing member of the firm, disclosed in a court filing that the firm does not have any connections with the Debtor and its creditors. The firm can be reached through: Don Wyatt The Law Offices of Donald L. Wyatt Jr., PC 26418 Oak Ridge Drive The Woodlands, Texas 773 80 (281) 419-8733 Phone (281) 419-8703 Facsimile About Rolling Lands Investments Rolling Lands Investments, LC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 16-32141) on April 28, 2016. The petition was signed by James W. Hammond, president. The case is assigned to Judge Marvin Isgur. The Debtor estimated assets of $1 million to $10 million and debts of $500,000 to $1 million. ROLLING LANDS: U.S. Trustee Unable to Appoint Committee ------------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Rolling Lands Investments, LC. About Rolling Lands Investments Rolling Lands Investments, LC sought protection under Chapter 11 of the Bankruptcy Code in the Southern District of Texas (Houston) (Case No. 16-32141) on April 28, 2016. The petition was signed by James W. Hammond, president. The case is assigned to Judge Marvin Isgur. The Debtor estimated assets of $1 million to $10 million and debts of $500,000 to $1 million. ROMA'S STEAK: Hires Long as Chapter 11 Counsel ---------------------------------------------- Roma's Steak and Pizzeria, Inc., seeks authority from the U.S. Bankruptcy Court for the Northern District of Alabama to employ Harry P. Long as counsel to the Debtor. Roma's Steak requires Long to: (a) give legal advice to the Debtor with respect to its powers and duties; (b) negotiate and formulate a plan of arrangement under Chapter 11 which will be acceptable to creditors and equity security holders; (c) deal with secured lien claimants regarding arrangements for payment of debts and, if appropriate, contesting the validity of the same; (d) prepare the necessary petition, answers, orders, reports and other legal papers; and (e) all other services which may be necessary. Long will be paid at these hourly rates: Harry P. Long $370 Long will also be reimbursed for reasonable out-of-pocket expenses incurred. Harry P. Long, Esq., assured the Court that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Long can be reached at: Harry P. Long, Esq. P.O. Box 1468 Anniston, AL 36202 Tel: (256) 237-3266 E-mail: Hlonglegal8@gmail.com About Roma's Steak Roma's Steak and Pizzeria, Inc. filed for Chapter 11 protection (Bankr. N.D. Ala. Case No. 16-40260) on February 17, 2016. The petition was signed by Zaharias J. Limberis, president. The Debtor estimated assets of $0 to $50,000 and estimated debts of $50,000 to $100,000. S-METALS FL: Hires Aresty as Bankruptcy Counsel ----------------------------------------------- S-Metals FL, LLC, seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to employ Joel M. Aresty, P.A. as counsel to the Debtor. S-Metals FL requires Aresty to: (a) give advice to the Debtor with respect to its powers and duties as a debtor in possession and the continued management of the business operations; (b) advise the debtor with respect to it responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; (c) prepare motions, pleadings, orders, applications, adversary proceedings, and other legal documents necessary in the administration of the case; (d) protect the interest of the debtor in all matters pending before the court; (e) represent the debtor in negotiation with its creditors in the preparation of a plan. Joel M. Aresty, Esq., of Joel M. Aresty, Esq. P.A., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Aresty can be reached at: Joel M. Aresty, Esq. 309 1st Ave S Tierra Verde, FL 33715 Tel: (305) 904-1903 Fax: (877) 350-9402 E-mail: Aresty@Mac.com About S-Metals FL S-Metals FL, LLC filed for Chapter 11 protection (Bankr. S.D. Fla. Case No. 16-17050) on May 17, 2016. The petition was signed by Shimon Segelman, manager. The Debtor estimated assets of $0 to $50,000 and estimated debts of $500,001 to $1,000,000. SAEED COHEN: Farida Cohen's Suit Dismissed Without Leave -------------------------------------------------------- Judge Neil W. Bason of the United States Bankruptcy Court for the Central District of California, Los Angeles Division, dismissed Fariba Cohen's complaint without leave to amend and granted defendant Saeed Cohen's Motion to Dismiss the adversary case captioned Fariba Cohen, Plaintiff(s), v. Saeed Cohen, Defendant(s), Adv No. 2:16-ap-01046-NB (Bankr. C.D. Calif.). The plaintiff, Ms. Fariba Cohen, apparently believes that the debtor has assets that were not disclosed in their divorce proceedings or in this bankruptcy case. Despite years of opportunities for discovery, she has failed to point to any actual evidence of significant nondisclosure. Moreover, the confirmed chapter 11 plan specifically contemplates that if there were any nondisclosed assets then they would become part of the property available for distribution. In view of those provisions of the plan, Ms. Cohen has not shown any plausible basis on which any nondisclosure could have played a role in procuring confirmation of the plan by fraud. In addition, any revocation of the order confirming the plan would only harm all parties in interest by taking away the existing mechanism to administer any previously undisclosed assets. Ms. Cohen's arguments on many of these issues are frivolous. Her complaint appears to have been filed solely as a means to increase the litigation expense and delay to her adversaries, out of spite and in an attempt to coerce more favorable treatment than that to which she previously agreed. Ms. Cohen has not suggested any way that her complaint could be further amended to cure these defects. A full-text copy of the Memorandum Decision dated May 16, 2016 is available at https://is.gd/VRmEn4 from Leagle.com. The bankruptcy case is In re: Saeed Cohen, Chapter 11, Debtor(s), Case No. 2:13-bk-26483-NB(Bankr. C.D. Calif.). Fariba Cohen, Plaintiff, is represented by Alan W Forsley, Esq. -- alan.forsley@flpllp.com -- Fredman Lieberman Pearl, LLP. Saeed Cohen, Defendant, is represented by Ron Bender, Esq. -- rb@lnbyb.com -- Levene, Neale, Bender, Yoo & Brill L.L.P, Krikor J Meshefejian, Esq. -- km@lnbyb.com -- Levene, Neale, Bender, Yoo & Brill L.L.P. Creditor Committee Committee of Creditors Holding Unsecured Claims, Creditor Committee, is represented by Christopher Celentino, Esq. -- celentinoc@ballardspahr.com -- Ballard Spahr LLP. SCHUPBACH INVESTMENTS: Taps Kuckelman & Stockemer as Accountant --------------------------------------------------------------- Schupbach Investments, LLC, asks for authorization from the U.S. Bankruptcy Court for the District of Kansas to employ Kuckelman & Stockemer as certified public accountants. Kuckelman & Stockemer will be paid at these hourly rates: Partner $200 Professional (non-partner) $150 Para Professional $100 Clerical $60 Michael E. Kuckelman, an accountant with Kuckelman & Stockemer assures the Court that the firm is disinterested, represents no interest adverse to the trustee or the estate in the matters upon which it is to be engaged, and understands that there is a continuing duty to disclose any adverse interest. Kuckelman & Stockemer can be reached at: Michael E. Kuckelman, Esq. Kuckelman & Stockemer 1000 N. Tyler Wichita, KS 67212 E-mail: mikek@cpawest.com About Schupbach Investments Jonathan Isaac and Amy Marie Schupbach were engaged in the business of buying, renovating, and renting or reselling homes in Wichita, Kansas. They did business through Schupbach Investments LLC, which filed for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case No. 11-11425) on May 16, 2011. Jonathan and Amy filed for relief on July 16, 2011, under Chapter 13, but the case was later converted to Chapter 11 (Case No. 11-13633). Schupbach Investments' schedule A listed 165 parcels of real property, 39 of which were mortgaged to Bank of Commerce & Trust Company. The Bank filed a proof of claim for $748,748.72 against the Schupbachs. In March 2014, the Debtors filed a proposed Chapter 11 plan. The bankruptcy court confirmed the Individual Plan on April 20, 2014. SCORPION PERFORMANCE: Exclusive Plan Filing Extended to Aug. 27 --------------------------------------------------------------- The Hon. Paul M. Glenn of the U.S. Bankruptcy Court for the Middle District of Florida has extended, at the behest of Scorpion Performance, Inc., the Debtor's exclusive right to file a plan of reorganization through Aug. 27, 2016, and solicit acceptances of that plan through Oct. 26, 2016. About Scorpion Performance Scorpion Performance, Inc., filed a Chapter 11 petition (Bankr. M.D. Fla., Case No. 15-05579) on December 30, 2015. The petition was signed by Angela M. Stopiano, president. The Debtor has tapped Polenberg Cooper PLLC as its legal counsel. The Debtor estimated assets of $3.93 million and debts of $1.36 million. SCOTTS MIRACLE-GRO: Moody's Affirms Ba2 CFR, Outlook Stable ----------------------------------------------------------- Moody's Investors Service affirmed all ratings of The Scotts Miracle-Gro Company, including the Ba2 Corporate Family Rating. The rating outlook is stable. The rating affirmation reflects Moody's expectation that Scotts will continue to deliver low single-digit organic sales growth and solid profitability over the foreseeable future. "The affirmation also reflects our expectation that Scotts will continue to maintain its leading market position and strong credit metrics, while acknowledging the company's shareholder return focus," said Kevin Cassidy, Senior Credit Officer, Moody's Investors Service. Ratings affirmed: The Scotts Miracle-Gro Company: Corporate Family Rating at Ba2; Probability of Default Rating at Ba2-PD: Senior unsecured instrument rating as B1, LGD5; Speculative Grade Liquidity Rating of SGL-2; Rating outlook is stable. RATINGS RATIONALE The Ba2 Corporate Family Rating reflects Scotts' strong market position within the fragmented lawn and garden industry, efficient operational platform, strong customer relationships and commitment to brand support and product development. The ratings are constrained by the seasonality of earnings and cash flows, weather dependency, exposure to volatile raw materials prices, the somewhat discretionary nature of its products and by its highly concentrated customer base. In addition, Moody's believes that Scotts will use its excess cash flow over the near to medium term for shareholder returns and targeted acquisitions, and will continue to rely on its revolver for seasonal working capital needs. Nevertheless, the rating agency recognizes the long-term favorable growth trends for lawn and garden products driven by favorable demographic and macro-economic trends, including the recovery of the housing market. The stable rating outlook reflects Moody's view that Scotts will modestly grow earnings, generate positive free cash flow, and pursue small bolt-on acquisitions over the next two years while maintaining seasonally adjusted debt to EBITDA between 3 times and 4 times. The ratings could be upgraded if the company demonstrates its commitment to keeping seasonally adjusted debt/EBITDA below 2.5 times, excluding seasonal working capital borrowings, and cash flow credit metrics improve, including retained cash flow to net debt being sustained around 20%. The ratings could be downgraded if financial metrics weaken due to deteriorating operating performance or the company incurs a material amount of debt to fund an acquisition or shareholder distribution. Key metrics driving a downgrade are seasonally adjusted debt/EBITDA sustained above 4 times, or EBIT margins maintained below 10%. The Scotts Miracle-Gro Company is a manufacturer and marketer of consumer lawn care and garden products, primarily in North America (approximately 85% of FY2015 sales) and Europe (15%). The company is headquartered in Marysville, Ohio. Revenues pro-forma for the divestiture of the controlling interest of the lawn care business were approximately $2.9 billion for the twelve months ending April 2, 2016. The principal methodology used in these ratings was Global Packaged Goods published in June 2013. SEARS HOLDINGS: Incurs $471 Million Net Loss in First Quarter ------------------------------------------------------------- Sears Holdings Corporation filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to Holdings' shareholders of $471 million on $5.39 billion of revenues for the 13 weeks ended April 30, 2016, compared to a net loss attributable to Holdings shareholders of $303 million on $5.88 billion of revenues for the 13 weeks ended May 2, 2015. As of April 30, 2016, Sears Holdings had $11.2 billion in total assets, $13.5 billion in total liabilities, and a total deficit of $2.36 billion. Edward S. Lampert, Holdings' chairman and chief executive officer, said, "While our operating performance still remains well below our goals, I am pleased to report that our first quarter Adjusted EBITDA, excluding Seritage Growth Properties and joint venture rent, improved by $14 million compared to the first quarter of 2015, largely driven by reductions in overall expenses. Our Sears Domestic and Kmart apparel businesses continue to be negatively impacted by a heavily promotional competitive environment. We continue to focus on improving the overall performance of these businesses through changes to our assortment, sourcing, pricing and inventory management practices. We remain focused on restoring Sears Holdings to profitability by concentrating on our best stores, our best members and our best categories through innovative solutions leveraging our Shop Your Way membership program and our Integrated Retail offerings." Rob Schriesheim, Holdings' chief financial officer, said, "We have an asset rich portfolio which provides us with numerous options to finance our transformation strategy. The closing of the previously announced $750 million Term Loan, together with the $500 million Secured Loan Facility, provides $1.25 billion of committed financing. When considered together with our previously announced intention to monetize at least $300 million of assets, this set of actions would result in an aggregate of $1.5 billion of enhanced liquidity. As we have consistently demonstrated, we will continue to take actions to adjust our capital structure and manage our business to enable us to execute on our transformation while meeting all of our financial obligations." Financial Position The Company's cash balances were $286 million at April 30, 2016, compared with $238 million at Jan. 30, 2016. Merchandise inventories at April 30, 2016, were $5.0 billion, compared to $5.1 billion at May 2, 2015, while merchandise payables were $1.3 billion and $1.7 billion at April 30, 2016 and May 2, 2015, respectively. Short-term borrowings totaled $380 million at the end of the first quarter of 2016 compared to $797 million at Jan. 30, 2016. At April 30, 2016, the Company had utilized approximately $896 million of its $1.971 billion revolving credit facility due in 2020 (consisting of $244 million of borrowings and $652 million of letters of credit outstanding). The amount available to borrow under its credit facility was approximately $265 million, which reflects the effect of its springing fixed charge coverage ratio covenant and the borrowing base limitation in its revolving credit facility, which varies primarily based on its overall inventory and receivables balances. Total long-term debt (long-term debt and capital lease obligations) was $3.4 billion and $2.2 billion at April 30, 2016 and January 30, 2016, respectively. Other Corporate Developments "As we continue to evaluate opportunities to accelerate our transformation and drive growth, we recognize there is significant potential to further develop our Kenmore, Craftsman and DieHard ("KCD") and Sears Home Services ("SHS") businesses. Accordingly, our Board of Directors has decided to explore alternatives for KCD and SHS. Our iconic KCD brands are beloved by the American consumer and we believe that we can realize significant growth by further expanding the presence of these brands outside of Sears and Kmart. Similarly, our SHS business, which is the nation's leading provider of in-home services (Protection Agreements, Parts Direct, Delivery/Installation/Repair and Home Improvement), has greater potential than what we have delivered in the past. As the "internet of things" develops and as more of our lives become connected, we believe SHS and KCD stand to benefit significantly from broader accessibility. By evaluating potential partnerships or other transactions that could expand distribution of our brands and service offerings, we can position both businesses to achieve greater success. "We have retained Citigroup Global Markets and LionTree Advisors to assist us in these efforts. There can be no assurance that we will complete one or more transactions, but we intend to aggressively evaluate all of the potential alternatives available to these businesses. "Finally, Sears announced today that its Chief Financial Officer, Robert Schriesheim, will be departing from his position with the Company to focus on his other business interests and pursue other career opportunities. To ensure a smooth transition, Mr. Schriesheim has agreed to continue in his current role until we have identified his replacement. Additionally, Mr. Schriesheim will continue to remain an advisor to the Company through January 31, 2017. "On behalf of Sears and its Board of Directors, I would like to thank Rob for his many contributions to the Company since he joined in 2011," said Mr. Lampert. A full-text copy of the Form 10-Q is availbale for free at: https://is.gd/hnG4dk About Sears Sears Holdings Corporation (NASDAQ: SHLD) -- http://www.searsholdings.com/-- is an integrated retailer focused on seamlessly connecting the digital and physical shopping experiences to serve members. Sears Holdings is home to Shop Your Waytm, a social shopping platform offering members rewards for shopping at Sears and Kmart as well as with other retail partners across categories important to them. The Company operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation, with more than 2,000 full- line and specialty retail stores in the United States and Canada. Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6, 2003, pursuant to the terms of an Amended Joint Plan of Reorganization. Skadden, Arps, Slate, Meagher & Flom, LLP, represented Kmart in its restructuring efforts. Its balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. Kmart bought Sears, Roebuck & Co., for $11 billion to create the third-largest U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in annual revenues. Kmart completed its merger with Sears on March 24, 2005. Sears Holdings reported a net loss of $1.12 billion on $25.14 billion of revenues for the year ended Jan. 30, 2016, compared to a net loss of $1.81 billion on $31.19 billion of revenues for the year ended Jan. 31, 2015. * * * Moody's Investors Service in January 2014 downgraded Sears Holdings Corporate Family Rating to 'Caa1' from 'B3'. The rating outlook is stable. The downgrade reflects the accelerating negative performance of Sears' domestic business with comparable sales falling 7.4% for the quarter to date ending January 6th, 2014 compared to the prior year. The company now expects domestic Adjusted EBITDA to decline to a range of ($80 million) to $20 million for the fourth fiscal quarter, compared with $365 million in the year prior period. For the full year, Sears expects domestic Adjusted EBITDA loss between $(308) million and $(408) million, as compared to $557 million last year. Moody's expects full year cash burn (after capital spending, interest and pension funding) to be around $1.2 billion in 2013 and we expect Sears' cash burn to remain well above $1 billion in 2014. "Operating performance for fiscal 2013 is meaningfully weaker than our previous expectations, and we expect negative trends in performance to persist into 2014" said Moody's Vice President Scott Tuhy. He added "While Sears noted improved engagement metrics for its "Shop Your Way" Rewards program, Moody's remains uncertain when these improved engagement metrics will lead to stabilization of operating performance." As reported by the TCR on March 26, 2014, Standard & Poor's Ratings Services affirmed its ratings on the Hoffman Estate, Ill.- based Sears Holdings Corp., including the 'CCC+' corporate credit rating. Fitch Ratings had downgraded its long-term Issuer Default Ratings (IDR) on Sears Holdings Corporation (Holdings) and its various subsidiary entities (collectively, Sears) to 'CC' from 'CCC', according to a TCR report dated Sept. 12, 2014. SFX ENTERTAINMENT: Auction of Flavorus Assets Pushed Back to June 2 ------------------------------------------------------------------- SFX Entertainment, Inc., et al., said the auction of substantially all of the assets of Flavorus, Inc., originally scheduled to commence on May 23, 2016 -- and postponed to May 24, 2016 and June 1, 2016 -- has been further postponed to Thursday, June 2, 2016 at 12:00 p.m. (Eastern Time) at the offices of Greenberg Traurig, LLP, 200 Park Ave., New York, NY 10166. The Debtors, subject to the consent of the Required Lenders and the Requisite Noteholders, and in consultation with the Official Committee of Unsecured Creditors, reserve the right to cancel or further postpone the Auction. Pursuant to the Notice of Hearing, the Sale Hearing is scheduled for June 8, 2016 at 10:30 a.m. (Eastern Time). As reported by the Troubled Company Reporter on May 11, 2016, the Debtors sought and obtained from the U.S. Bankruptcy Court for the District of Delaware, approval of its bidding procedures for the sale of all or substantially all of the assets of Flavorus, Inc. Flavorus, is a ticketing company whose main revenue source comes from fees on ticket sales, and to a lesser extent, per-ticket fees on tickets sold by companies licensing Flavorus's ticketing platform. Flavorus's software platform allows for high-volume sales and customizability to serve various types of events. SFX completed its acquisition of Flavorus on April 1, 2014. As part of SFX, Flavorus supports ticket sales of SFX's and third partyâ€™s events, and provides customer service, on-site operations and marketing. Flavorus is no longer viewed by the Debtors as core to the SFX platform on a go forward basis. In an attempt to maximize the realization of value of the Flavorus Assets for the benefit of the Debtors' estates the Debtors propose the Bid Procedures. Currently, the Debtors are soliciting bids for the Flavorus Assets based on the form of asset purchase agreement which the Debtors will provide to interested bidders, as the Debtors have not yet selected a potential bidder to serve as the "stalking horse." However, if the Debtors receive sufficient interest and potential bidders are interested in serving as the Stalking Horse Bidder, the Debtors may negotiate an appropriate asset purchase agreement with a potential bidder interested in serving as the Stalking Horse Bidder. Wilmington Savings Fund Society, FSB, the DIP Agent, on behalf of the DIP Lenders, and U.S. Bank National Association, the Second Lien Agent, on behalf of holders of 9.625% Second Lien Noteholders, are determined to be Qualified Bidders for all purposes at the Auction, and will be permitted, but not obligated, to credit bid to the full extent permitted under the Bankruptcy Code. Counsel for the Debtors and Debtors-in-Possession Dennis A. Meloro, Esq. GREENBERG TRAURIG, LLP 1007 North Orange Street, Suite 1200 Wilmington, Delaware 19801 Telephone: (302) 661-7000 Facsimile: (302) 661-7360 Email: melorod@gtlaw.com - and - Nancy A. Mitchell, Esq. Maria J. DiConza, Esq. Nathan A. Haynes, Esq. GREENBERG TRAURIG, LLP 200 Park Avenue New York, New York 10166 Telephone: (212) 801-9200 Facsimile: (212) 801-6400 E-mail: mitchelln@gtlaw.com diconzam@gtlaw.com haynesn@gtlaw.com About SFX Entertainment SFX Entertainment, Inc., and 43 of its affiliates, a global producer of live events and digital entertainment content focused exclusively on the electronic music culture and other world-class festivals, 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. Judge Mary F. Walrath is assigned to the case. Greenberg Traurig, LLP serves as the Debtors' counsel. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors retained Pachulski Stang Ziehl & Jones LLP as counsel; and Conway Mackenzie, Inc., as financial advisor. SFX ENTERTAINMENT: Founder Steps Down as CEO, Inks Transition Deal ------------------------------------------------------------------ SFX Entertainment, Inc., and its debtor affiliates seek authority from the Bankruptcy Court to enter into a Resignation and Transition Agreement with their former Chief Executive Officer and Executive Chairman, Mr. Robert F.X. Sillerman. The Debtors also seek the Court's authority to reject Mr. Sillerman's Employment Agreement. A hearing on the request is set for June 22, 2016 at 11:30 a.m. Objections are due June 15, 2016 at 4:00 p.m. The Restructuring Support Agreement -- dated as of January 31, 2016, entered into by and among the Debtors, certain holders of the Debtors' Second Lien Notes, and Mr. Sillerman prior to the Petition Date -- was structured to require Mr. Sillerman's resignation by April 1, 2016 because the Debtors and the noteholder parties to the RSA believed, inter alia, (i) the Debtors retaining Mr. Sillerman as Chief Executive Officer through the end of March 2016 would allow the Debtors to stabilize their business in the early days of these Chapter 11 Cases and reduce the risk of additional turmoil; and (ii) Mr. Sillerman's resignation by April 1, 2016 would be beneficial because it would allow the Debtors to prepare for the future and attract a management team that could successfully lead the Debtors after their emergence from bankruptcy. To comply with their obligations under the RSA, the Debtors sought Mr. Sillerman's resignation by the end of March 2016. The RSA itself did not spell out the terms and conditions of the resignation. Mr. Sillerman indicated to the Debtors that he would agree to resign as required by the RSA in exchange for certain limited benefits. Accordingly, the Debtors, the DIP lenders, the pre-petition secured lenders and Mr. Sillerman negotiated the terms of the Resignation Agreement. As part of those negotiations, Mr. Sillerman indicated to the Debtors that he believed he possessed prepetition and postpetition claims arising from his employment that could be asserted against the Debtors. The Debtors disputed those allegations. Aside from entering into the Resignation Agreement, the Debtors' other options were to (i) leave Mr. Sillerman in as Chief Executive Officer, which would violate the RSA, would not have been supported by the Committee, and would not, in the Debtors' business judgment, have represented a productive step in moving their restructuring forward; or (ii) remove Mr. Sillerman from office, which also would not comply with the terms of the RSA, and would have resulted in a public dispute with Mr. Sillerman. The Debtors believed that the optics and practical effect of such dispute would have been detrimental to the Debtors' business and would have resulted in the expenditure of significant time and money by the Debtors. As the founder of SFX, Mr. Sillerman has been the Chairman of the Board and, until his recent resignation, CEO of SFX since its inception in 2011. As of the Petition Date, Mr. Sillerman and SFX Entertainment were parties to an Employment Agreement dated October 18, 2012, and an Indemnification Agreement dated April 15, 2013 governing the relationship between Mr. Sillerman and the Company. Pursuant to the RSA, Mr. Sillerman agreed to resign from his positions with SFX on or prior to April 1, 2016. The RSA contemplated that Mr. Sillerman would be replaced by Michael Katzenstein of FTI Consulting -- mike.katzenstein@fticonsulting.com -- on an interim basis unless a permanent CEO had been identified by that date. On March 31, 2016, consistent with the terms of the RSA, the Company and Mr. Sillerman entered into the Resignation Agreement. On the following day, Mr. Katzenstein, the Debtors' Chief Restructuring Officer, was appointed the Debtors' interim CEO. Pursuant to the Resignation Agreement, Mr. Sillerman has agreed to resign from all officer and director positions at SFX effective as of March 31, 2016, other than his position as Chairman of the Board of Directors of the Company. The Resignation Agreement contains these key terms: * As he was prior to his resignation, Mr. Sillerman will be entitled to participate in, and receive benefits under, any health insurance plan made available by the Company to its employees from time to time. * Mr. Sillerman will remain as an employee of SFX and in this position will be paid minimum wage (as he was prior to his resignation) for as long as he remains Chairman of the Board of Directors of the Company. Mr. Sillerman will receive the New York State statutory minimum salary for an exempt employee, or approximately $675 per week. The Debtors' health benefit plans are provided through co-employer TriNet HR Corporation. Under this co-employment arrangement, Mr. Sillerman must maintain employment with the Debtors and receive at least minimum wage in order to be eligible to receive the health benefits contemplated by the Resignation Agreement. * Mr. Sillerman may retain the support of his personal assistant (on an exclusive basis) for so long as he remains Chairman of the Board of the Company; provided that if his personal assistant resigns then the Company shall have no obligation to provide an exclusive assistant for Mr. Sillerman and shall provide Mr. Sillerman an assistant on a non-exclusive basis. * Mr. Sillerman may retain his current office, but only for so long as the Company is occupying the 15th floor of 902 Broadway. * Mr. Sillerman will be permitted to use the Company's car currently available to him until the earlier of the date (a) on which he ceases to be Chairman of the Board or (b) the Company sells or otherwise disposes of the car; provided that (x) the Company shall not have any obligation to pay for the services of a driver for the car; (y) Mr. Sillerman shall pay the Company $1,000 per month plus the amount of estimated costs, expenses or other charges the Company expects to incur in connection with the car in advance and in immediately available funds; and (z) Mr. Sillerman shall be personally responsible for all charges related to the car including, without limitation, insurance, fuel, maintenance, and repairs. In addition, Mr. Sillerman has agreed to hold the Company harmless and to indemnify the Company for any damages, costs or expenses incurred by the Company in connection with his use of the car. Thus, the expenses to the Company relating to the car are essentially passed through to Mr. Sillerman. * Mr. Sillerman has agreed that he will not assert claims (other than prepetition unsecured claims) on account of severance or termination benefits under his Employment Agreement, or any other employment agreement he may currently have or has had in the past with the Company and/or any of its subsidiaries. * Mr. Sillerman has agreed to release the Company, its subsidiaries, successors and assigns, and its directors, officers, employees, or agents in such capacities (collectively, the "Released Parties") from any and all claims, liabilities and obligations that are based in any way on any act or omission on the part of the Released Parties that occurred on or prior to the date of the Resignation Agreement and arise out of or relate to (i) Mr. Sillerman's resignation as Chief Executive Officer and Executive Chairman of the Company; (ii) fraud, defamation, emotional distress, and discharge in violation of public policy related to Mr. Sillerman's resignation and his employment with the Company through the date of the Resignation Agreement; and (iii) all federal, state, and local statutory claims relating to Mr. Sillerman's resignation and his employment with the Company through the date of the Resignation Agreement. About SFX Entertainment SFX Entertainment, Inc., and 43 of its affiliates, a global producer of live events and digital entertainment content focused exclusively on the electronic music culture and other world-class festivals, 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. Judge Mary F. Walrath is assigned to the case. Greenberg Traurig, LLP serves as the Debtors' counsel. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors retained Pachulski Stang Ziehl & Jones LLP as counsel; and Conway Mackenzie, Inc., as financial advisor. SFX ENTERTAINMENT: TriNet Objects to Assignment of Contracts ------------------------------------------------------------ TriNet Group, Inc., and its subsidiaries, including TriNet HR Corporation, object to SFX Entertainment, Inc., et al.'s motion seeking authority to assume and assign certain executory contracts between the Debtors and TriNet. TriNet complains that the proposed cure amount of $0 cure may be inaccurate given the structure of the services, including payroll and other human resources management and benefits administration responsibilities, that TriNet has provided to the Debtors, additional sums may continue to accrue up to the closing date of the sale, which amounts must be paid as part of any cure owed to TriNet. In addition, TriNet also complains that the ultimate assignee's identity is uncertain, considering that there is currently no stalking horse bidder while the sale is subject to an auction, and as a result, TriNet cannot evaluate either the eventual purchaser's acceptability as an assignee under the terms of the contract the Debtors seek to assume and assign, or to ascertain whether the assignee is a TriNet competitor. Accordingly, TriNet requests that the Debtors provide TriNet information -- financial bona fides and confirmation that the assignee is not a TriNet competitor -- about any potential purchaser to whom the Debtors propose to assign the TriNet Agreement. Attorneys for TriNet Group, Inc.: James E. Huggett, Esq. MARGOLIS EDELSTEIN 300 Delaware Avenue, Suite 800 Wilmington, Delaware 19801 Telephone: (302) 888-1112 Email: jhuggett@margolisedelstein.com -- and -- Amish R. Doshi, Esq. MAGNOZZI & KYE, LLP 23 Green Street, Suite 302 Huntington, New York 11743 Telephone: (631) 923-2858 Email: adoshi@magnozzikye.com -- and -- Shawn M. Christianson, Esq. Valerie BantnerPeo, Esq. BUCHALTER NEMER P.C. 55 Second Street, Suite 1700 San Francisco, California 94105 Telephone: (415) 227-0900 Email: schristianson@buchalter.com vbantnerpeo@buchalter.com -- and -- Doug Riegelhuth, Esq. VP and Associate General Counsel TRINET GROUP, INC. 100 San Leandro Blvd., Suite 400 San Leandro California 94577 About SFX Entertainment SFX Entertainment, Inc., and 43 of its affiliates, a global producer of live events and digital entertainment content focused exclusively on the electronic music culture and other world-class festivals, 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. Judge Mary F. Walrath is assigned to the case. Greenberg Traurig, LLP serves as the Debtors' counsel. Kurtzman Carson Consultants LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors retained Pachulski Stang Ziehl & Jones LLP as counsel; and Conway Mackenzie, Inc., as financial advisor. SHEEHAN PIPE LINE: Surety Objects to Proposed Cash Collateral Use ----------------------------------------------------------------- Zurich American Insurance Company and Fidelity and Deposit Company of Maryland object to Sheehan Pipe Line Construction Company's motion seeking authority to use of cash collateral and proceeds of collateral that constitute a security interest for the Debtor's debts and obligations. According to the Surety, in postpetition discussions with the Debtor, the Surety has been advised that the Debtor has $371,000 in prepetition funds is unencumbered, has leased certain of its equipment to Precision Pipeline, LLC, is receiving proceeds from these leases, and is intending to use such proceeds for day-to-day operations, asserting that these funds are not cash collateral -- even though the equipment leased is the Surety's collateral. The Surety tells the Court that it has been asking the Debtor for documentation regarding these leases, as well as the source of all other cash to be used in the Debtor’s operations, but the Surety has not yet received sufficient information on the status of all cash although the Debtor has provided some documentation and a proposed budget. Furthermore, the Surety narrates that it has advised the Debtor of, and the Debtor affirmatively acknowledged, the trust fund nature of contract proceeds under the Indemnity Agreement and agreed to segregate those funds. However, after repeated requests for assurances that the trust funds should be segregated and not be used, the Debtor instead spent the Surety's trust funds without consent. So that, the Surety is skeptical about the Debtor's use of cash until the Debtor makes an adequate showing of its right to use any cash and the source of all cash is identified, which includes submitting a motion with a proper budget and grant of adequate protection, giving all parties a chance to comment upon and/or object to such use and for the court to approve a budget established with appropriate restrictions, regardless of whether the funds constitute cash collateral. The Debtor responded saying that the Surety has no security interest in its accounts receivable of Debtor, but the Surety is now trying to subsume Debtor's accounts receivable by claiming such funds as proceeds of equipment. The Debtor argues that the funds it has been receiving from Precision's short-term rental of its equipment are accounts receivable since the Debtor has not disposed of any interest in its collateral by virtue of this short-term rental to Precision. Thus, the Debtor says that this is not the type of lease regarding disposition of collateral contemplated under the Uniform Commercial Code considering that the disposition will be made at the auction currently set for June 16, 2016, and in fact, Precision will return the equipment at the end of the rental term. Accordingly, the Debtor relates that even if the funds are determined to be cash collateral, their use is necessary and justified under the Bankruptcy Code for without the use of the alleged cash collateral to protect and preserve the assets until the time of the auction, the value of Debtor’s estate will diminish significantly and result in fewer proceeds from which to satisfy the claim of the Surety and other creditors. Furthermore, the Debtor submits that no additional adequate protection is required considering that the Debtor has entered into an Asset Purchase Agreement contemplating a sale of Debtor’s equipment for $29.5 million -- $13 million of the proceeds will go to satisfy the first secured position of CAT and the remaining approximately $16.5 million will be made available to satisfy the claims of the Surety and other creditors. The Debtor concludes that until the time that the Surety’s claim actually exceeds $16.5 million, the Surety is adequately protected. Proposed Attorneys for the Debtor and Debtor-in-Possession: Gary M. McDonald, Esq. Chad J. Kutmas, Esq. Mary E. Kindelt, Esq. MCDONALD, MCCANN, METCALF & CARWILE, LLP First Place Tower 15 E. Fifth Street, Suite 1400 Tulsa, OK 74103 Telephone: (918) 430-3700 Facsimile: (918) 430-3770 Email: gmcdonald@mmmsk.com ckutmas@mmmsk.com mkindelt@mmmsk.com Attorneys for Zurich American Insurance Company and Fidelity and Deposit Company of Maryland: Duane J. Brescia, Esq. STRASBURGER & PRICE, LLP 600 Congress Ave., Suite 1600 Austin, Texas 78701 Telephone: 512.499.3600 Facsimile: 512.499.3660 Email: duane.brescia@strasburger.com -- and -- Christopher R. Ward, Esq. STRASBURGER & PRICE, LLP 901 Main Street, Suite 4400 Dallas, Texas 75202 Telephone: 214.651.4300 Facsimile: 214.651.4330 Email: christopher.ward@strasburger.com -- and -- Charles Greenough, Esq. McAFEE & TAFT, P.C. 1717 South Boulder, Suite 900 Tulsa, Oklahoma 74119 Telephone: (918) 587-0000 Facsimile: (918) 599-9317 Email: Charles.greenough@mcafeetaft.com About Sheehan Pipe Line Sheehan Pipe Line Construction Company, a contractor that constructs pipelines in various states across the country, filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Oklahoma (Case No. 16-10678) on April 15, 2016, listing total assets of $90.2 million and total debt of $68.4 million. The petition was signed by Robert A. Riess, Sr., as president and CEO. McDonald, McCann & Metcalf & Carwile, LLP, serves as counsel to the Debtor. The case is pending before Judge Terrence L. Michael. The Office of the U.S. Trustee has appointed six members to Sheehan Pipe Line Construction Co.'s official committee of unsecured creditors. SPEEDWAY MOTORSPORTS: S&P Affirms 'BB+' Rating on Sr. Notes ----------------------------------------------------------- S&P Global Ratings Services affirmed its 'BB+' issue-level rating (the same as the 'BB+' corporate credit rating) on Concord, N.C.-based motorsports entertainment company Speedway Motorsports Inc.'s (SMI) senior unsecured notes and revised the recovery rating to '3' from '4' following the company's repayment of approximately $80 million in debt, which improves recovery prospects for existing noteholders. The '3' recovery rating reflects S&P's expectation of meaningful (50% to 70%; upper end of range) recovery for lenders in the event of a payment default. The 'BBB' issue-level ratings and '1' recovery ratings on the revolver due 2019 and $200 million delayed draw term loan due 2019 remain unchanged. RATINGS LIST Speedway Motorsports Inc. Corporate Credit Rating BB+/Stable/-- Rating Affirmed; Recovery Rating Revised To From Speedway Motorsports Inc. Senior Unsecured BB+ BB+ Recovery Rating 3H 4H SQUARETWO FINANCIAL: Moody's Hikes Corporate Family Rating to Caa2 ------------------------------------------------------------------ Moody's Investors Service rated SquareTwo Financial Corporation's Senior Secured First Lien Term Loan and Revolving Credit Facility Caa1 and Senior Secured Term Loan Caa3. Its Senior Second Lien Notes were affirmed at Ca and the Corporate Family Rating was upgraded to Caa2 from Ca. The outlook is stable. Actions Issuer: SquareTwo Financial Corporation Corporate Family Rating Upgraded to Caa2 from Ca Senior Secured First Lien Term Loan and Revolving Credit Facility Rated Caa1 Senior Secured Term Loan Rated Caa3 Senior Second Lien Notes Affirmed at Ca The outlook for the ratings is stable RATINGS RATIONALE The two notch upgrade of the Corporate Family Rating is due to SquareTwo's debt exchange and recapitalization which was completed on 24 May 2016 and will enable the company to continue to operate through difficult market conditions. Leading up to the exchange, SquareTwo was experiencing net losses, weakened cashflow generation, and growing negative equity as a result of reduced supply of charged-off debt and elevated pricing of this debt in the marketplace. This limited supply is driven by regulatory concerns regarding suppliers' ability to package relevant, accurate information when they sell charged-off debt. In addition, suppliers of charged-off debt have an obligation to evaluate that buyers have adequate processes to service borrowers. While the Caa2 Corporate Family Rating is a two notch upgrade, the rating continues to reflect considerable challenges for SquareTwo to grow its portfolio to a more scalable level and become profitable. SquareTwo's completed debt exchange recapitalized the company in response to its default on the pre-existing first lien revolving credit facility and senior second lien notes. Subsequent to the default, SquareTwo entered into a new $165 million senior secured financing facility and exchanged $268 million of its senior second lien notes for a $174 million term loan and $94 million of preferred stock. SquareTwo's legacy senior second lien notes totaling $22 million are rated Ca and are now subordinated to the term loan. The legacy senior second lien notes have an April 2017 maturity which exposes the company to near-term refinancing risk whereas the new debt instruments have two and three year maturities. With the exception of the first lien credit facility and the legacy senior second lien notes, the remaining debt will be payment in kind for two years. This will help the company contend with a distressed charged-off debt market which continues to be negatively impacted with limited supply. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE SquareTwo's ratings could be upgraded if the company is able to increase its purchasing activity and earn respectable returns on investment. Capturing efficiencies of scale will also be important after almost two years of compressed volumes and a shrinking service platform. SquareTwo will need to satisfy its existing legacy senior second lien notes which mature in April 2017. Concerns regarding its ability satisfy this obligation would question the viability of the business and the level of commitment from SquareTwo's various stakeholders and could lead to a rating downgrade. Ratings could also be downgraded if the market continues to have limited supply of charged-off debt or if SquareTwo has difficulty reestablishing itself as a reputable purchaser in this sector. SquareTwo is a purchaser of charged off debt receivables which pursues collections via in-house staff and a network of attorneys. SquareTwo is headquartered in Denver, CO. STANLEY JOSEPH CATERBONE: Court Orders Show Cause for Appeal ------------------------------------------------------------ Pro se movant, Stanley Joseph Caterbone, filed a motion for application for leave to appeal the order of United States Bankruptcy Judge Richard E. Fehling dated and entered on February 18, 2016. On the second page of this motion, Caterbone requests that the order to dismiss be appealed to this court. He also requests leave to proceed in forma pauperis. Judge Edward G. Smith of the United States District Court for the Eastern District of Pennsylvania required Caterbone to show cause why the court should not dismiss the appeal for lack of subject-matter jurisdiction as on its face, the motion for leave to appeal (which the court has construed as a notice of appeal) is untimely insofar as it was filed one day after the 14-day period concluded. A full-text copy of the Memorandum Opinion dated May 16, 2016 is available at https://is.gd/gBcu3X from Leagle.com. The case is IN RE: STANLEY JOSEPH CATERBONE, Movant, Civil Action No. 16-mc-49, Bankruptcy No. 16-10517. STANLEY JOSEPH CATERBONE, IN RE:, Pro Se. STARVING STUDENTS: Seeks to Hire Garman Turner as Legal Counsel --------------------------------------------------------------- Starving Students, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Nevada to hire Garman Turner Gordon LLP as its legal counsel. The Debtor tapped the firm to provide these legal services: (a) prepare legal papers on behalf of the Debtor; (b) take all necessary actions in connection with a plan of reorganization; (c) take all necessary actions to protect and preserve the estate of the Debtor, including the prosecution of actions on its behalf, the defense of any actions commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections to claims filed against the estate; and (d) perform all other necessary legal services. Garman Turner's attorneys and paraprofessionals hourly rates range from $130 to $190 for paraprofessionals; $200 to $385 for associates; and $435 to $775 for partners. The firm will also seek reimbursement of its expenses. Garman Turner is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Gregory E. Garman, Esq. Mark M. Weisenmiller, Esq. 650 White Drive, Ste. 100 Las Vegas, NV 89119 Tel: 725-777-3000 Fax: (725) 777-3112 E-mail: ggarman@gtg.legal mweisenmiller@gtg.legal About Starving Students Starving Students, Inc. sought protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Nevada (Las Vegas) (Case No. 16-10936) on February 29, 2016. The petition was signed by Roberto Valencia, CFO. The case is assigned to Judge Mike K. Nakagawa. STELLAR BIOTECHNOLOGIES: Named a Calif. Small Business of the Year ------------------------------------------------------------------ Stellar Biotechnologies, Inc., announced that the Company will be recognized as a 2016 California Small Business of the Year in ceremonies today at the state capitol in Sacramento, California. 44th District Assembly Member Jacqui Irwin (D-Camarillo) will honor Stellar with the distinction during the California State Assembly's annual California Small Business Day, May 25, 2016. "The Stellar team is proud of its contributions to ocean conservation and immunotherapy research, and our position as a biotechnology employer in the local Port Hueneme community," said Frank Oakes, president and chief executive officer of Stellar Biotechnologies, Inc. "We thank the California State Assembly for today's recognition." About Stellar Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.'s business is to commercially produce and market Keyhole Limpet Hemocyanin ("KLH") as well as to develop new technology related to culture and production of KLH and subunit KLH ("suKLH") formulations. The Company markets KLH and suKLH formulations to customers in the United States and Europe. KLH is used extensively as a carrier protein in the production of antibodies for research, biotechnology and therapeutic applications. Stellar Biotechnologies reported a net loss of $8.43 million for the year ended Aug. 31, 2014, a net loss of $14.5 million for the year ended Aug. 31, 2013, and a net loss of $5.52 million for the year ended Aug. 31, 2012. Stellar Biotechnologies reported a net loss of $2.84 million on $758,689 of revenues for the year ended Sept. 30, 2015. As of March 31, 2016, Stellar had $9.42 million in total assets, $616,097 in liabilities and $8.81 million in shareholders' equity. STEREOTAXIS INC: Shareholders Elect 3 Directors ----------------------------------------------- Stereotaxis, Inc., held its annual meeting of shareholders on May 24, 2016, at which the shareholders: (1) elected Duane DeSisto, Fred A. Middleton and William C. Mills III as Class III directors to serve until the Company's 2019 annual meeting; (2) ratified the appointment of Ernst & Young LLP as the Company's independent registered public accounting firm for fiscal year 2016; (3) approved, by non-binding vote, executive compensation; and (4) approved an amendment to the Stereotaxis, Inc. 2012 Stock Incentive Plan to increase the number of shares authorized for issuance thereunder by 1,500,000 shares. About Stereotaxis Based in St. Louis, Missouri, Stereotaxis, Inc., is a manufacturer and developer of a suite of navigation systems in interventional surgical procedures. The Company's Epoch Solution is used in the treatment of arrhythmias and coronary artery disease. Stereotaxis reported a net loss of $7.35 million on $37.67 million of total revenue for the year ended Dec. 31, 2015, compared to a net loss of $5.20 million on $35.01 million of total revenue for the year ended Dec. 31, 2014. As of March 31, 2016, Stereotaxis had $15.2 million in total assets, $34.8 million in total liabilities and a total stockholders' deficit of $19.6 million. In its report on the Company's consolidated financial statements for the year ended Dec. 31, 2015, Ernst & Young LLP, in St. Louis, Missouri, issued a "going concern" qualification stating that the Company has incurred recurring losses from operations and has a net capital deficiency that raise substantial doubt about the Company's ability to continue as a going concern. SUNGARD AVAILABILITY: Moody's Lowers CFR to B3, Outlook Stable -------------------------------------------------------------- Moody's Investors Service downgraded Sungard Availability Services Capital, Inc.'s ("Availability Services") corporate family and probability of default ratings to B3 and B3-PD from B2 and B2-PD, respectively. In addition, Moody's downgraded the ratings on the $250 million senior secured revolving credit facility due 2018 and $1.025 billion senior secured term loan due 2019 to B1 from Ba3 and the $425 million senior unsecured notes due 2022 to Caa2 from Caa1. The rating outlook was changed to stable from negative. RATINGS RATIONALE The downgrade reflects Moody's expectation that Availability Services's profits will continue to decline through 2016 by over 10%, with stabilization occurring in 2017. Adjusted debt to EBITDA should rise to over 5x by the end of 2016 (from 4.7x at the end of Dec. 31, 2015) though free cash flow will likely be negative through 2017. The transformation of Availability Services's business model will remain challenged by the expected run off of the traditional data recovery business, continuing pressures on co-location pricing, the lag time associated with converting new Recovery-as-a-Service (RaaS) and managed services contracts, and the growing shift of computing workloads to the public cloud. With the inflection point for generating meaningful cash flow occurring in 2018, this could pose some financing risks associated with extending the revolving credit facility, which matures in March 2018, and the $1.025 billion term loan due March 2019. The risks associated with this transition are partly mitigated by the ability to sell assets to repay debt as demonstrated in May 2015 when Availability Services sold 8 data centers for gross proceeds of $140 million, of which $110 million of net proceeds was used to repay the senior secured term loan. The revenue base is supported by long-term relationships, a market leading position in the recovery business, and relatively low customer concentration. The B3 CFR considers that while managed services and cloud hosting offer solid long term growth prospects, Availability Services faces substantial competition and evolving technological shifts (e.g., virtualized data center platforms and web enabled, third party storage and computing) which could lower the demand for the company's service offerings and require the company to invest considerably. The current business already has high capex requirements to support multiple recovery centers and data centers that provide co-location and critical IT functions. Additional R&D and sales investments may be needed to enhance market positioning, service delivery, and technological capabilities in an industry where scale is essential. Meanwhile, liquidity will likely be hampered over the next two years as the revolver capacity will likely be constrained by a springing covenant on the $250 million revolver ($238 million available as of Dec. 31, 2015,) maturing in 2018. If Sungard AS cannot maintain compliance with the covenant due to rising leverage this year, the effective revolver availability would drop to $63 million, or 25% of the total revolving commitments. The stable outlook reflects Moody's expectation of low single digit revenue declines in 2016 followed by slight growth in 2017, with low to mid single digit operating margins. Moody's anticipates negative free cash flow of over $30 million in 2016, but good liquidity supported by a high cash balance ($180 million as of December 31, 2015) and data center assets that can be sold to raise additional proceeds to repay debt. The stable outlook also assumes Sungard will not make dividend payments to its private equity sponsors. The ratings could be upgraded with consistent revenue and profitability growth (in the low single digits), positive cash flow, and adjusted debt to EBITDA below 4 times on a sustained basis. Downward ratings pressure could arise if the prospects of a rebound in revenue and profit growth appears unlikely in 2017, monthly recurring revenues decline significantly, adjusted debt to EBITDA exceeds 6 times, or liquidity deteriorates to the point that combined total of cash and available revolver capacity falls below $200 million. Ratings Downgraded: Corporate Family Rating, Downgraded to B3 from B2 Probability of Default Rating, Downgraded to B3-PD from B2-PD $250 Million Senior Secured Revolving Credit Facility due 2018, Downgraded to B1 (LGD3) from Ba3 (LGD3) $1025 Million Senior Secured Term Loan due 2019, Downgraded to B1 (LGD3) from Ba3 (LGD3) $425 Million Senior Unsecured Notes due 2022, Downgraded to Caa2 (LGD5) from Caa1 (LGD5) Outlook Action: Outlook Rating, Changed to Stable from Negative The principal methodology used in these ratings was Business and Consumer Service Industry published in December 2014. With over $1.2 billion of projected annual revenues, Sungard Availability Services is a provider of disaster recovery services and managed IT services and is owned by a consortium of private equity investors (including Bain, Blackstone, KKR, Silver Lake, Texas Pacific Group, GS Partners, and Providence Equity). SUTHERLAND HOLDINGS: Case Summary & 3 Unsecured Creditors --------------------------------------------------------- Debtor: Sutherland Holdings II, LLC 13040 Gandy Blvd. N. Saint Petersburg, FL 33702 Case No.: 16-04577 Nature of Business: Single Asset Real Estate Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Jake C Blanchard, Esq. BLANCHARD LAW, P.A. 1501 S. Belcher Rd. Unit 2B Largo, FL 33771 Tel: 727-531-7068 Fax: 727-535-2086 E-mail: jake@jakeblanchardlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $100,000 to $500,000 The petition was signed by Brian Storman, managing member. A list of the Debtor's three largest unsecured creditors is available for free at http://bankrupt.com/misc/flmb16-04577.pdf SWORDS GROUP: Case Summary & 10 Unsecured Creditors --------------------------------------------------- Debtor: Swords Group, LLC 492 Industrial Drive Mt. Juliet, TN 37122 Case No.: 16-03837 Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Middle District of Tennessee (Nashville) Judge: Hon. Marian F Harrison Debtor's Counsel: Griffin S Dunham, Esq. DUNHAM HILDEBRAND, PLLC 1704 Charlotte Avenue, Suite 105 Nashville, TN 37203 Tel: 615-933-5850 E-mail: griffin@dhnashville.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Jerry Swords, president. A list of the Debtor's 10 largest unsecured creditors is available for free at http://bankrupt.com/misc/tnmb16-03837.pdf TANGO TRANSPORT: Creditors' Panel Hires Heller Draper as Counsel ---------------------------------------------------------------- The Official Committee of Unsecured Creditors of Tango Transport, LLC, et al., seeks authority from the U.S. Bankruptcy Court for the Eastern District of Texas to retain Heller Draper Patrick Horn & Dabney, LLC as counsel to the Committee. The Committee requires Heller Draper to: a. advise the Committee of its rights, duties, and powers in the Chapter 11 Case; b. prepare on behalf of the Committee all necessary motions, applications, answers, orders, reports and filings to support the positions of the Committee; c. appear as appropriate before this Court, the district court, the appellate courts, or any other courts in which matters may be heard and to protect the interests of the Committee before said courts and the United States Trustee; d. assist, advise, and represent the Committee in investigating and analyzing the Debtors' assets and liabilities, investigating the extent and validity of any liens, participating in and reviewing any proposed asset sales or dispositions; e. represent the Committee in any meetings or negotiations with the Debtors, secured parties, and other parties in interest; f. review, analyze all applications, orders, operating reports, schedules and statements of affairs filed and to be filed with this Court by the Debtors or other interested parties; g. assist and advise the Committee in its examination, investigate, analysis and negotiation of any financing or funding agreements; h. take all necessary actions to protect and preserve the interests of unsecured creditors, including without limitation, the prosecution of actions on behalf of the Committee, negotiations concerning all litigation in which the Debtors are involved, and review and analysis of all claims filed against the Debtors' estates and analysis of all executory contracts and un-expired non-residential leases proposed to be assumed or rejected by the Debtors; i. coordinate the receipt and dissemination of information prepared by and received from the Debtors, the Debtors' professionals, and any matters before the Court; j. assist the Committee in the review, analysis and negotiations regarding any plan of reorganization or liquidation that may be filed and to assist the Committee in the review, analysis and negotiation of the disclosure statement accompanying any proposed plan; and k. advise the Committee and perform all other necessary legal services that may be required in connection with the Chapter 11 Case. Heller Draper will be paid at these hourly rates: Partners $450-$375 Associates $350-$250 Paralegals $110-$130 Prior to the Petition Date, Heller Draper represented the unofficial committee of unsecured creditors. Heller Draper was paid $50,364.69 for pre-petition services and upon the filing date, was holding a retainer in the amount of $75,000.00. On May 11, 2016, Heller Draper returned $24,635.31 to the Debtors' counsel. Heller Draper will also be reimbursed for reasonable out-of-pocket expenses incurred. Tristan Manthey, member of Heller Draper Patrick Horn & Dabney, LLC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Heller Draper can be reached at: Tristan Manthey, Esq. HELLER DRAPER PATRICK HORN & DABNEY, LLC 650 Poydras Street, Suite 2500 New Orleans, LA 70130 Tel: (504) 299-3300 Fax: (504) 299-3399 E-mail: tmanthey@hellerdraper.com About Tango Transport Tango Transport, LLC sought protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Eastern District of Texas (Sherman) (Case No. 16-40642) on April 6, 2016. The petition was signed by B.J. Gorman, president of Gorman Group, Inc., sole member of Debtor. The Debtor is represented by Keith William Harvey, Esq., at The Harvey Law Firm, P.C. The Debtor estimated assets of $0 to $50,000 and debts of $10 million to $50 million. TATOES LLC: Leland, Anderson Farms Want Replacement Liens --------------------------------------------------------- Creditors Glenn Leland and Anderson Farms, Inc., ask the U.S. Bankruptcy Court for the Eastern District of Washington to determine the validity, extent and/or priority of their Landlord's Lien in Tatoes, LLC, et al.'s crops. Mr. Leland and Anderson Farms request that they be granted a replacement lien in all crops grown by the Debtors upon property leased by Mr. Leland and Anderson Farms to the Debtors and on all products and proceeds thereof for the full amount of any and all unpaid rent. Debtor's Objection Rabo AgriFinance, Inc., filed objections to Mr. Leland and Anderson Farms' motions. "This Court should refuse at this time to make any determination about the validity, extent or priority of any liens against the 2016 Crops. It would be procedurally improper for the Court to do so, and the Court would be rendering an improper advisory opinion about issues that are not ripe and have not been adequately investigated or briefed... Leland and Anderson are not entitled to a 'replacement lien' on the 2016 Crops, because their cash collateral is not being used to generate the 2016 Crops. Only RAF, which according to the Debtors has the only pre-petition lien on cash collateral, is entitled to a replacement lien on the 2016 Crops, because RAF's cash collateral will not be turned over to RAF but, instead, will be used to generate the 2016 Crops," RAF avers. Glenn Leland and Anderson Farms, Inc., are represented by: Steven H. Sackmann, Esq. SACKMANN LAW OFFICE P.O. Box 409 - 455 E. Hemlock, #A Othello, WA 99344 Telephone: (509) 488-5636 Facsimile: (509) 488-6126 Rabo AgriFinance, Inc., is represented by: Bruce K. Medeiros, Esq. DAVIDSON BACKMAN MEDEIROS PLLC 1550 Bank of America Financial Center 601 West Riverside Avenue Spokane, WA 99201 Telephone: (509)624-4600 Facsimile: (509)623-1660 E-mail: bmedeiros@dbm-law.net - and - Michael R. Johnson, Esq. Douglas M. Monson, Esq. RAY QUINNEY & NEBEKER P.C. 36 South State Street, Suite 1400 Salt Lake City, UT 84111 Telephone: (801) 532-1500 Facsimile: (801) 532-7543 E-mail: mjohnson@rqn.com dmonson@rqn.com About Tatoes, LLC Tatoes, LLC, Wahluke Produce, Inc., and Columbia Manufacturing, Inc., are engaged in farming, packing, storing, and selling potatoes, onions and wheat. Each of the Debtors filed Chapter 11 bankruptcy petitions (Bankr. E.D. Wash. Case Nos. 16-00900, 16-00899 and 16-00898, respectively) on March 21, 2016. Tatoes LLC estimated assets and liabilities in the range of $10 million to $50 million. Wahluke Produce and Columbia Manufacturing estimated assets in the range of $50 million to $100 million and liabilities of up to $100 million. Bailey & Busey LLC serves as counsel to the Debtors. TIME INC: S&P Lowers CCR to 'BB-', Outlook Stable ------------------------------------------------- S&P Global Ratings said it lowered its corporate credit rating on New York City-based Time Inc. to 'BB-' from 'BB'. The outlook is stable. At the same time, S&P lowered the issue-level rating on the company's senior secured credit facility to 'BB+' from 'BBB-'. The recovery rating on this debt remains '1', indicating S&P's expectation for very high (90% to 100%) recovery in the event of a payment default. S&P also lowered the issue-level rating on its senior unsecured notes to 'BB-' from 'BB'. The recovery rating on this debt remains '3', indicating S&P's expectation for meaningful (50% to 70%; lower half of the range) recovery in the event of a payment default. "The ratings downgrade reflects our more cautious view of Time Inc.'s ability to deleverage and its business transformation given our belief that secular pressures the magazine industry faces will intensify as consumer preferences shift to digital media from print media," said S&P Global Ratings credit analyst Minesh Patel. More specifically, the downgrade reflects the revision of S&P's financial risk assessment to significant from intermediate based on our cash flow volatility adjustment. Although S&P expects adjusted leverage will decline to just within its 2x-3x rating threshold range over the next two years, the volatility adjustment incorporates a cushion of medium-term variance because of stress scenarios not factored into S&P's base-case forecast. Stress scenarios include a recessionary economic environment, greater-than-expected technology or competitive shifts, or material business transformation execution missteps. S&P's stable outlook reflects its view that the company will continue to scale and extend its brand online while stabilizing ad revenues. It assumes that adjusted leverage will decline to the high-2x area over the next two years and that liquidity will remain strong. TOPS HOLDING: Moody's Affirms B3 Corporate Family Rating -------------------------------------------------------- Moody's Investors Service changed the ratings outlook for Tops Holding II ("HoldCo") Corporation to negative from stable. Moody's also affirmed the company's B3 Corporate Family Rating and B3-PD Probability of Default rating. Additionally, Moody's affirmed the B3 rating of Tops Holding LLC's senior secured notes due 2022 and the Caa2 rating of Holdco's senior unsecured notes due 2018. The change in outlook to negative reflects the uncertainty regarding the company's ability to improve its credit metrics to levels consistent with its B3 rating category given the challenging and competitive business environment. "Tops' credit metrics position the company weakly in the B3 rating category with debt to EBITDA deteriorating to 7.0 times at the end of fiscal 2015 from 6.6 times the prior year and EBIT to interest currently at less than 1.0 times", Moody's Senior Analyst Mickey Chadha said. "The company's B3 rating incorporates our expectation that the company will make material progress to reduce financial leverage towards 6.5 times and improve EBIT to interest to at least 1.0 times in the next 12 months", Chadha further stated. RATINGS RATIONALE The following ratings are affirmed and point estimates updated: Tops Holding II Corporation Corporate Family Rating at B3 Probability of Default Rating at B3-PD Senior unsecured notes due 2018 at Caa2 ( LGD6) Tops Holding LLC Senior secured notes due 2022 at B3 (LGD3) The B3 Corporate Family Rating reflects the company's weak credit metrics, its modest size relative to competitors, and regional concentration. The rating is supported by its relatively stable operating performance in a challenging business and competitive environment, its good market presence in the regions in which it operates and its adequate liquidity. Given Tops' high financial leverage, a rating upgrade is not expected in the near-to-intermediate term. The outlook could be stabilized if the company demonstrates its ability to grow same store sales, maintain margins and maintain (EBITDA -Capital Expenditures) to interest of at least 1.0 times and improve debt to EBITDA towards 6.5 times. Over time a rating upgrade would require positive same store sales, a material improvement in credit metrics and a commitment to more conservative financial policies. Ratings could rise if Tops demonstrates sustained EBIT to interest above 1.75 times and sustained debt/EBITDA below 6.0 times while maintaining adequate liquidity. Ratings could be downgraded if the company does not demonstrate sequential improvement in operating performance and credit metrics or if liquidity deteriorates. Tops is the parent of Tops Holding LLC and the indirect parent of Tops Markets, LLC, which is headquartered in Williamsville, NY, and operates 165 full-service supermarkets, 164 under the Tops banner and one under the Orchard Fresh banner, with an additional five supermarkets operated by franchisees under the Tops banner. Revenues totaled about $2.5 billion for fiscal 2015. TOWN SPORTS: Robert Giardina Resigns as Director ------------------------------------------------ Robert Giardina delivered notice to Town Sports International Holdings, Inc. that he was resigning as member of the Board of Directors of the Company due to personal reasons, effective May 24, 2016. About Town Sports New York-based Town Sports International Holdings, Inc. is one of the leading owners and operators of fitness clubs in the Northeast and mid-Atlantic regions of the United States and, through its subsidiaries, operated 151 fitness clubs as of March 31, 2016, comprising 104 New York Sports Clubs, 27 Boston Sports Clubs, 12 Washington Sports Clubs (one of which is partly-owned), five Philadelphia Sports Clubs, and three clubs located in Switzerland, and three BFX Studio locations. In addition, the Company also has one partly-owned club that operated under a different brand name in Washington, D.C. as of March 31, 2016. These clubs collectively served approximately 553,000 members as of March 31, 2016. For more information on TSI, including the Company's Form 10-Q for the quarterly period ended March 31, 2016, visit http://investor.mysportsclubs.com As of March 31, 2016, Town Sports had $300 million in total assets, $403 million in total liabilities and a total stockholders' deficit of $103 million. * * * As reported by the TCR on March 14, 2016, Standard & Poor's Ratings Services said it raised its corporate credit rating on New York City-based Town Sports International Holdings Inc. to 'CCC+' from 'SD'. Town Sports carries a Caa2 corporate family rating from Moody's Investors Service. TRANSDIGM INC: Fitch Assigns B- Rating on $950MM Sr. Sub. Notes --------------------------------------------------------------- Fitch Ratings has assigned a 'B-/RR5' rating to TransDigm Inc.'s (TDI) issuance of $950 million of senior subordinated notes, subject to review of the issuance's governing documents. The ratings take into account future issuance of up to $950 million in term loans which are expected to be incurred sometime later in the fiscal year ended Sept. 30, 2016. The company intends to use the proceeds to finance the acquisition of Data Device Corporation (DDC) for approximately $1 billion and for general corporate purposes. TDI is a wholly owned subsidiary of TransDigm Group, Inc. (TDG). Fitch's ratings will cover approximately $10.3 billion of debt after giving effect to the announced debt issuances. The Rating Outlook is Stable. On May 24, 2016, TDG announced it had entered into a definitive agreement to purchase the stock of ILC Holdings, Inc., the parent company to DDC, a company supplying solid-state power control products, motion control products, and databus for the aerospace & defense and industrial sectors. Fitch believes DCC will be a good business fit with TDG's existing businesses, because approximately 70% of DDC's revenue is generated from aftermarket sales, and substantially all products are proprietary and sole-source. DDC's revenues are expected to be more than $200 million in calendar 2016. Even though TDG's revenues and EBITDA may not be significantly impacted by DDC's acquisition in fiscal 2016, the $1.9 billion increase in indebtedness will not affect TDG's ratings, as the company's pro forma credit metrics are expected to remain within the current rating range. TDG's financial performance in fiscal 2016 will be bolstered by several large acquisitions throughout both fiscal 2015 and fiscal 2016. Fitch expects these acquisitions will drive an approximately 17% increase to both revenue and EBITDA in fiscal 2016 (excluding DDC's operations), enabling the company to maintain relatively flat leverage despite a large increase in debt. Fitch estimates TDG's leverage will increase to approximately 7.3x by the end of fiscal 2016, up from 7x at the end of fiscal 2015. The Recovery Ratings and notching in the debt structure reflect Fitch's recovery expectations under a scenario in which distressed enterprise value is allocated to the various debt classes. The senior subordinated notes are at the 'RR5' level, which reflects an expected recovery in the 11%-30% range. KEY RATING DRIVERS The ratings are supported by the company's strong FCF (cash from operations less capital expenditures and dividends), good liquidity, strong margins, healthy commercial aerospace markets, higher U.S. defense spending, and a favorable debt maturity schedule. TDG has good diversification in its portfolio of products that supports a variety of commercial and military platforms/programs, and it is a sole source provider for the majority of its sales. TDG generates significant cash flows due to its ability to demand a premium for its products, partially driven by a large percentage of sales from a relatively stable and highly profitable aftermarket business; low research and development costs; and low capital expenditures. Additionally, TDG's cash flows benefit from the lack of material pension liabilities and no other post-employment benefit (OPEB) obligations. The company's leverage metrics have been stable over the past several years, as leverage has remained in the range of 6x to 7.5x. Fitch expects the company will continue managing its capital structure with leverage in the range of 6.5x to 7.5x going forward. Fitch expects TDG's leverage will be at 7.3x by the end of fiscal 2016 after giving effect to the announced debt issuance; however, Fitch expects leverage to decline to approximately 7x by the end of fiscal 2017. Even though TDG's leverage metrics have stabilized, the company's coverage ratios have steadily deteriorated as FFO interest coverage declined to 2.5x at the end of 2015 from 3.2x at the end of 2012. TGD's ratio of operating EBITDA-to-gross interest expense declined to 3x, down from 4x during the same period. Fitch anticipates continued deterioration of coverage ratios due to expected increase in indebtedness and corresponding rise of cash interest expenses. Fitch believes TDG has the capacity to make approximately $500 million of acquisitions per annum with internally generated cash; however, a larger acquisition would likely require debt financing. Fitch views TDG's projected metrics as consistent with the 'B' Issuer Default Rating (IDR), but the level of support for this rating has been reduced by the new leverage paradigm. The ratings are also supported by positive trends in most of the company's end markets. The Large Commercial Aircraft (LCA) market continues to be in a strong upturn, which is driving higher orders and deliveries of LCA worldwide. Both LCA manufacturers are currently experiencing a record operating environment in terms of orders, backlog and deliveries. The large order book, overbooked delivery slots, and geographic diversity support the outlook for continued modest growth. The fiscal 2015 U.S. defense budget hit a trough (base budget and wartime spending). There have been positive defense spending developments in both the U.S. and U.K., where spending should rise in 2016. International demand continues to be healthy. The global threat environment remains a tailwind. However, Fitch still considers the defense outlook to be somewhat uncertain, partly due to the Pentagon's intense focus on lowering costs, including some questioning of the defense sector's profitability. Fitch's concerns include the company's high leverage, declining interest coverage, the long-term cash deployment strategy which focuses on acquisitions and occasional debt-funded special dividends, and weak collateral support for the secured bank facility in terms of asset coverage. Additionally, Fitch notes that TDG is exposed to the cyclicality of the aerospace industry, as it reported several quarters of organic sales declines during fiscal 2009 and 2010 driven by lower demand for aftermarket parts and production cuts by commercial original equipment manufacturers (OEMs). The market cyclicality is somewhat mitigated by growth from acquisitions, high margins, and sales diversification. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for TDG include: -- Leverage will remain in the range of 6.5x to 7.5x over the next several years; -- The company will issue additional debt over the next three years, offsetting expected growth in EBITDA; -- Excess cash will be paid to shareholders in the form of special dividends if the company does not make acquisitions; -- Revenues will grow by approximately 17% in both fiscal 2016 and in fiscal 2017. The growth will slow to low double- digits thereafter driven by acquisitions and anticipated growth of the aerospace and defense sector; -- Margins will remain in the range of 44% to 46% over the rating horizon; -- The company will maintain long-term cash balances in the range of $500 million to $700 million. RATING SENSITIVITIES Fitch does not anticipate positive rating actions in the near term given current credit metrics and the company's cash deployment strategies. Positive rating actions could be considered if the company modifies its cash deployment strategy and focuses on debt reduction. A negative rating action may be considered if there is significant cash flow margin erosion without commensurate de-leveraging of the company. Additionally, Fitch may consider a negative rating action should TDG's leverage (debt-to-EBITDA) and FFO adjusted leverage increase and remain between 8x to 8.25x and above 9.5x, respectively, driven by weakening of the global economy, a downturn in the aerospace sector, or by issuance of additional debt to fund special dividends or acquisitions. LIQUIDITY The streak of recent acquisitions should allow TDG to accelerate its revenue and EBITDA growth over the next several years, improving its financial flexibility. TDG has adequate financial flexibility and good liquidity supported by a $550 million revolving credit facility and a sizable cash balance, as the company typically holds above $500 million in cash. The company does not have a significant maturity until 2017 when $500 million of senior subordinated notes become due. Fitch anticipates the company will refinance the notes and estimates TDG's liquidity will fluctuate between $1 billion to $1.5 billion over the next several years. TDG's liquidity will increase slightly with the anticipated $50 million increase in the company's revolving credit facility some time later in fiscal 2016. FULL LIST OF RATING ACTIONS Fitch currently has these ratings: TDG -- Long-term IDR 'B'. TDI -- IDR at 'B'; -- Senior secured revolving credit facility 'BB/RR1'; -- Senior secured term loans 'BB/RR1'; -- Senior subordinated notes 'B-/RR5'. The Rating Outlook is Stable. TRIBUNE MEDIA: Court Sustains Objection to Claim No. 3697 --------------------------------------------------------- In the case captioned In re: TRIBUNE MEDIA COMPANY, et al., Reorganized Debtors, Case No. 08-13141 (KJC) (D.I. 3796, 11792) (Bankr. D Del), Judge Kevin J. Carey of the United States Bankruptcy Court for the District of Delaware sustained the objection to proof of claim number 3697 filed by Robert Henke against the debtor, The Baltimore Sun Company. Henke's claim, in the amount of $100 million, is based on a defamation lawsuit that he filed pro se against the Sun in 2008 arising out of a newspaper article published on October 7, 2007. In the objection, the debtors argued that (i) the underlying lawsuit was filed after the applicable statute of limitations, (ii) Henke has not provided evidence to support his claims of defamation and other causes of action, and (iii) Henke has not provided any support for calculating his damages at $100 million. "The Debtors provided sufficient evidence to rebut the prima facie validity of Mr. Henke's Claim. The burden then shifts to Mr. Henke to prove his Claim and, for the reasons set forth above, he has not done so. Accordingly, the Claim Objection will be sustained, and claim numbers 3697 and 7106 will be disallowed and expunged in their entirety," stated Judge Carey. A full-text copy of Judge Levy's February 22, 2016 order is available at http://bankrupt.com/misc/TRIBUNE142660525.pdf TRILOGY INTERNATIONAL: Moody's Assigns Caa1 Rating on $450MM Notes ------------------------------------------------------------------ Moody's Investors Service assigned a Caa1 rating to Trilogy International Partners LLC's $450 million 13.375% senior secured notes due 2019. Trilogy used the net proceeds for the redemption of its existing 10.250% senior secured notes due August 2016. The refinancing strengthens the company's liquidity profile by extending its debt maturities. Liquidity is further strengthened from the $35 million proceeds Trilogy received in March 2016 from the sale of its subsidiary Trilogy Dominica S.A. The outlook remains stable. Assignments: Issuer: Trilogy International Partners LLC Senior Secured Regular Bond/Debenture, Assigned Caa1 (LGD4) RATINGS RATIONALE Trilogy's B3 Corporate Family Rating is based on the relatively strong performance of its wireless operations in Bolivia and improving results from New Zealand. Moody's expects leverage to trend down and cash flow to improve as the operations in New Zealand reach scale and expand their service offerings. The EBITDA contribution from New Zealand should continue to grow as subscriber counts increase, product offerings are expanded and lower operating costs are achieved as its infrastructure is built out and it benefits from lower roaming rates. Bolivian operations are expected to remain strong due to healthy overall economic growth, increasing smartphone penetration and higher rates of data usage. The company began deploying LTE in Bolivia in May 2015, and continues expanding its LTE network in New Zealand. The rating also reflects the political, regulatory, economic, and competitive risks that Trilogy faces from the fact that its Bolivian operations provide the vast majority of its EBITDA and funds from operations. However, concentration in Bolivia (rated Ba3, stable) is declining as the company's New Zealand operations grow. The rating outlook is stable given Moody's expectation for continued revenue and EBITDA growth. An improved liquidity profile and positive free cash flow combined with leverage levels maintained below 4x (Moody's adjusted) could result in a positive rating action. A weakening of liquidity or a decline in EBITDA due to regulatory, political or competitive reasons that would increase leverage above 5.75x (Moody's adjusted) on a sustained basis would likely lead to a downgrade. The principal methodology used in this rating was Global Telecommunications Industry published in December 2010. TRINITY RIVER: Hires Bracewell as Counsel ----------------------------------------- Trinity River Resources, LP, seeks authority from the U.S. Bankruptcy Court for the Western District of Texas to employ Bracewell LLP as counsel to the Debtor. Trinity River requires Bracewell to: a. advise the Debtor with respect to its powers and duties as debtor in possession in the continued management and operation of its business and properties; b. advise and consult on the conduct of the chapter 11 case, including all of the legal and administrative requirements of operating in chapter 11; c. attend and negotiate with representatives of creditors and other parties-in-interest; d. take all necessary actions to protect and preserve the Debtor's estate, including prosecuting actions on the Debtor's behalf, defending any action commenced against the Debtor, and representing the Debtor in negotiations concerning litigation in which the Debtor is involved, including objections to claims filed against the Debtor's estate; e. prepare pleadings in connection with the chapter 11 case, including motions, applications, answers, orders, reports, and papers necessary or otherwise beneficial to the administration of the Debtor's estate; f. represent the Debtor in connection with obtaining authority to continue using cash collateral; g. advise the Debtor in connection with any potential sale of assets; h. appear before the Court and any appellate courts to represent the interests of the Debtor's estate; i. advise the Debtor regarding tax matters; j. take any necessary action on behalf of the Debtor to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a chapter 11 plan and all documents related thereto; and k. perform all other necessary legal services for the Debtor in connection with the prosecution of this chapter 11 case, including (i) analyzing the Debtor's leases and contracts and the assumption and assignment thereof; (ii) analyzing the validity of liens against the Debtor; and (iii) advising the Debtor on corporate and litigation matters. Bracewell will be paid at these hourly rates: William A. (Trey) Wood III $840 Chelsea Dal Corso $380 Partners $480-$1,200 Associates $335-$765 Paraprofessionals $180-$325 During the 90 days before the Petition Date, Bracewell received payments in the amount of $378,041.51 for services rendered to the Debtor, including services in connection with potential out-of-court restructuring transactions and commencement of the chapter 11 case. On April 12, 2016, the Debtor paid a $100,000.00 retainer to Bracewell. Bracewell earned the retainer upon receipt and placed the amount into its operating account. Bracewell will also be reimbursed for reasonable out-of-pocket expenses incurred. William A. (Trey) Wood III, partner in the law firm os Bracewell LLP, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Bracewell can be reached at: William A. (Trey) Wood III, Esq. Chelsea R. Dal Corso, Esq. BRACEWELL LLC 711 Louisiana, Suite 2300 Houston, TX 77002 Tel: (713) 223-2300 Fax: (713) 221-1212 E-mail: Trey.Wood@bracewelllaw.com Chelsea.DalCorso@bracewelllaw.com About Trinity River Trinity River Resources LP sought protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Western District of Texas (Austin) (Case No. 16-10472) on April 21, 2016. The Debtor is represented by Chelsea Rose Dal Corso, Esq., and William A. (Trey) Wood III, Esq., at Bracewell LLP. The case is assigned to Judge Tony M. Davis. The Debtor estimated assets of $50 million to $100 million and debts of $100 million to $500 million. TRINITY TOWN: Chapter 11 Plan Provides for Sale by Aug. 30 ---------------------------------------------------------- Trinity Town Center, LLLP, on May 16, 2016, submitted a Disclosure Statement in support of its Plan of Reorganization filed on June 22, 2016. The Debtor's Plan provides for the sale or auction of the property with net proceeds to be distributed to creditors. Holders of allowed unsecured claims will be paid their pro rata share from any surplus proceeds remaining from the sale, auction or re-financing of the Project, after payment of secured Claims in order of priority. Equity holders will retain their interests and are unimpaired under the Plan. The Debtors' property will be sold under the Plan by Colliers International Tampa Bay prior to Aug. 30, 2016 if possible, if not it will be auctioned by Oct. 30, 2016. The ultimate sale will establish the value of the collateral for the purpose of determining secured claims against the estate. Adversary Proceeding 8:16-ap-00288-KRM, and the confirmation process will establish the relative priorities of the various secured creditors against the collateral. The proceeds of the sale will be paid to the holders of the allowed secured claims as soon as is reasonably practical. The CRO will preserve and maintain the property of the estate. The Disclosure Statement describes: (a) The Debtor and significant events during the bankruptcy case; (b) How the Plan proposes to treat claims or equity interests; (c) Who can vote on or object to the Plan; (d) What factors the Bankruptcy Court will consider when deciding whether to confirm the Plan; (e) Why the Debtor believes the Plan is feasible, and how the treatment of the claim or equity interest under the Plan compares to what would be received on the claims or equity interest in liquidation; and (f) The effect of confirmation of the Plan. A full-text copy of the Disclosure Statement, dated May 16, 2016, is available at https://is.gd/T9VdvP Trinity Town Center is represented by: Richard J. McIntyre, Esq. MCINTYRE THANASIDES BRINGGOLD ELLIOT GRIMALDI & GUITO, P.A. 500 E. Kennedy Blvd., Ste. 200 Tampa, FL 33602 Tel: (813) 223-0000 Fax: (813) 899-6069 E-mail: rich@mcintyrefirm.com About Trinity Town Center Trinity Town Center LLLP is a Florida limited liability limited partnership, developing, owning and operating the Trinity Town Center, a real estate project located in Trinity, Florida, that is intended to be used as a life style center containing retail, restaurant, financial services, and offices for professional and medical. On Jan. 20, 2015, Trinity Town Center LLLP filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 16-00405) in Tampa, Florida. The petition was signed by Michael D. Luetgert, the CRO. The Debtor has scheduled $25,215,778 in total assets and $21,599,870 in total liabilities. The Debtor has tapped McIntyre Thanasides Bringgold Elliot as its legal counsel. TX FOUR HOLDINGS: Seeks to Hire Brouse McDowell as Legal Counsel ---------------------------------------------------------------- TX Four Holdings LLC and its two affiliates seek approval from the U.S. Bankruptcy Court for the Northern District of Ohio to hire Brouse McDowell, LPA as their bankruptcy counsel. TX Four Holdings, Circle T Farm Inc. and Four Wells Limited tapped the firm as substitute counsel after their lawyer Michelle DiBartolo-Haglock of Thomas Trattner and Malone LLC left her firm, according to court filings. Brouse McDowell will provide these services to these Debtors: (a) provide advice about their powers and duties as debtors-in-possession; (b) advise the Debtors on all bankruptcy matters; (c) prepare legal papers; (d) represent the Debtors at all hearings; (e) prosecute and defend litigated matters; (f) prepare and file a disclosure statement, and negotiate and implement a plan of reorganization; (g) negotiate and seek approval of a sale of the Debtors' assets and other transactions; (h) represent the Debtors on matters related to the assumption or rejection of their executory contracts and leases; and (i) advise the Debtors about corporate, real estate, litigation, labor, finance, tax and other legal matters. The Debtors anticipate that these attorneys and staff will assist them during their bankruptcy: Professionals Hourly Rates ------------- ------------ Marc Merklin $425 Kate Bradley $325 Lucas Blower $300 Thomas Gattozzi $320 Bridget Franklin $265 Theresa Palcic $165 Mark Merklin, Esq., a principal at Brouse McDowell, disclosed in a court filing that the firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Mark B. Merklin Kate M. Bradley Brouse McDowell, LPA 388 S. Main Street, Suite 500 Akron, Ohio 44311 Phone: (330) 535-5711 Fax: (330) 253-8601 mmerklin@brouse.com kbradley@brouse.com About TX Four Holdings TX Four Holdings, Circle T Farm Inc. and Four Wells Limited each filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Ohio (Akron) (Case Nos. 16-50853, 16-50852 and 16-50851) on April 13, 2016. The petitions were signed by Louis Telerico, managing member. The cases are assigned to Judge Alan M. Koschik. TX Four Holdings and Four Wells estimated both their assets and liabilities in the range of $1 million to $10 million. Circle T Farm estimated assets of $100,000 to $500,000 and debts of $1 million to $10 million. ULTRA PETROLEUM: Taps Rothschild and Petrie as Investment Bankers ----------------------------------------------------------------- Ultra Petroleum Corp., et al., seek authority from the U.S. Bankruptcy Court for the Southern District of Texas to employ Rothschild Inc. and Petrie Partners Securities, LLC as investment bankers to the Debtors. Ultra Petroleum requires Rothschild to: (a) identify potential Restructuring Transaction or another Transaction or any series or combination of Restructuring Transactions or Transactions ("Transactions"); (b) review and analyze the Debtors' assets and the operating and financial strategies of the Debtors in connection with potential Transactions; (c) evaluate the Debtors' debt capacity in light of their projected cash flows and assist in the determination of an appropriate capital structure for the Debtors; (d) assist the Debtors and their other professionals in reviewing the terms of any proposed Transaction, in responding thereto and, if directed, in evaluating alternative proposals for a Transaction; (e) assist the Debtors in determining a range of values for the Debtors and any securities that the Debtors offer or propose to offer in connection with a Transaction; (f) advise the Debtors on the risks and benefits of considering a Transaction with respect to the Debtors' intermediate and long-term business prospects and strategic alternatives to maximize the business enterprise value of the Debtors; (g) review and analyze any proposals the Debtors solicit or receive from third parties in connection with a Transaction, including, without limitation, any proposals for debtor-in-possession financing, as appropriate; (h) assist or participate in negotiations with the parties in interest, including, without limitation, any current or prospective creditors of, holders of equity in, or claimants against the Debtors and/or their respective representatives in connection with a Transaction; (i) advise the Debtors with respect to, and attend, meetings of the Debtors' Board of Directors, creditor groups, official constituencies and other interested parties, as necessary; (j) participate in hearings before the Court and provide relevant testimony with respect to the matters described herein and issues arising in connection with any proposed Plan (as defined in the Engagement Letter); and (k) render, but only to the extent permitted by further orders of the Court, such other financial-advisory or investment- banking services as may be agreed upon by the Investment Bankers and the Debtors. Ultra Petroleum requires Petrie to: (a) meet with management of the Debtors and the Debtors' consulting engineering firm, as appropriate, to gain a thorough understanding of the assets, business, and prospects of the Debtors; (b) review estimates of the Debtors' proved, probable, possible, and contingent reserves and resources prepared by the Debtors and the Debtors' consulting engineering firm and compare these estimates to the Debtors' business plan projections and historical results; (c) provide the Debtors with market updates on the oil and gas industry sector and performance, including with respect to mergers and acquisitions activity and capital markets; (d) assist the Debtors' management in formulating, reviewing and analyzing the Debtors' financial projections and in developing and updating a financial model, including modeling of forecast sensitivities such as one rig, two rig, three rig, or other potential drilling schedules and asset development plans; (e) review the impact to the Debtors' net present value of various potential drilling and development plan scenarios, commodity price forecasts, and midstream operating assumptions; (f) assist the Debtors in performing valuation and liquidation analyses with respect to the Debtors' businesses and assets; (g) assist the Debtors in compiling and prioritizing a list of potential counterparties for a potential Transaction and in facilitating contact with such potential counterparties; (h) assist the Debtors in formulating and executing a process to solicit proposals from potential counterparties for a Transaction; (i) assist management of the Debtors in coordinating due diligence by potential counterparties, including managing a data room and, together with the Debtors' legal counsel, obtaining appropriate confidentiality agreements; (j) assist the Debtors in preparing management presentations to potential purchasers and other interested parties; (k) participate in negotiations with potential counterparties in a Transaction; (l) participate in hearings before the Court and provide relevant testimony with respect to the matters described above; (m) assist the Debtors in preparing financial reports as may be required in connection with the Debtors' chapter 11 cases; and (n) render, but only to the extent permitted by further orders of the Court, such other financial advisory and investment-banking services as may be agreed upon by the Investment Bankers and the Debtors. Rothschild will be paid as follows: (a) Retainer: A non-refundable retainer equal to $240,000. (b) Monthly Fee: $120,000 per month. (c) Completion Fee: $7,200,000 upon the earlier of (i) the confirmation and effectiveness of a Plan and (ii) the closing of a Restructuring Transaction. (d) M&A Fee: Upon the closing of an M&A Transaction, 0.6 percent of the Aggregate Consideration involved in any M&A Transaction. (e) New Capital Fee: A fee equal to (but which in the aggregate shall not exceed $8,100,000): -- 0.6 percent of the face amount of any senior secured debt raised; -- 1.2 percent of the face amount of any junior secured or senior or subordinated unsecured debt raised; and -- 2.4 percent of any equity capital, capital convertible into equity or hybrid capital raised, including, without limitation, equity underlying any warrants, purchase rights, or similar contingent equity securities. For the avoidance of doubt, clauses (i) through (iii) above shall include, without limitation, any debtor-in-possession financing raised; provided, however, that if any such debtor- in-possession financing converts to an exit facility, no additional Rothschild New Capital Fee shall be payable except to the extent that the amount raised (as defined herein) of such exit facility exceeds the outstanding amount of such debtor-in-possession financing at the time of such conversion. The Rothschild New Capital Fee shall be payable upon the closing of the transaction by which the new capital is committed. For the avoidance of doubt, the term "raised" means the amount of new funds committed or otherwise made available to the Debtors whether or not such amount (or any portion thereof) is drawn down at closing or is ever drawn down and whether or not such amount (or any portion thereof) is used to refinance existing obligations of the Debtors. For the further avoidance of doubt, the Rothschild New Capital Fee relating to any warrants, purchase rights, or similar contingent equity securities shall be due and payable upon the closing of the transaction by which such instruments are issued and shall be calculated as if all such instruments are exercised in full (and the full cash exercise price is paid) on the date of such closing, whether or not all or any portion of such instruments are vested and whether or not such instruments are actually so exercised. Notwithstanding the foregoing, if a Restructuring Transaction or an M&A Transaction consists of any Acquirer acquiring "control" (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) of the Debtors for cash (whether or not while acting as a "plan sponsor" of a Plan), no Rothschild New Capital Fee shall be payable with respect to such cash purchase price paid by such Acquirer; provided, however, if new debt capital is raised as part of such transaction or Plan, a Rothschild New Capital Fee shall remain payable with respect to such new debt capital; provided, further, that such new debt capital shall not be double counted in calculating the Rothschild New Capital Fee and the Aggregate Consideration with respect to any Rothschild M&A Fee; provided, further that if such transaction or Plan includes the issuance of purchase rights (e.g., a rights offering), warrants, or similar contingent equity securities, then a Rothschild New Capital Fee shall remain payable with respect to such purchase rights, warrants, or similar contingent equity securities. Notwithstanding anything herein to the contrary and for the avoidance of doubt, no Rothschild New Capital Fee shall be payable on account of a transaction that does not result in new capital having been raised (as defined above), including on account of "take-back" debt or equity. (f) In the event the Debtors enter into a transaction that constitutes both a Restructuring Transaction and an M&A Transaction, Rothschild shall be entitled to elect to receive the higher of the Rothschild Completion Fee and the Rothschild M&A Fee. (g) Credit: Rothschild shall credit against its Completion Fee: (a) 50 percent of Rothschild's Monthly Fees paid in excess of $480,000 (such credit, the "Rothschild Monthly Fee Credit"); (b) 50 percent of any M&A Fees paid to Rothschild (such credit, the "Rothschild M&A Fee Credit"); and (c) to the extent not otherwise applied against the fees and expenses of Rothschild under the terms of the Engagement Letter, Rothschild's Retainer; provided that the sum of any Rothschild M&A Fee Credit and the Rothschild Monthly Fee Credit shall not exceed Rothschild's Completion Fee. (h) Cap: The aggregate amount of fees due and owing to Rothschild from the Debtors pursuant to clauses (c), (d), and (e) above shall not exceed, after accounting for any applicable credits, $15,300,000. Petrie will be paid as follows: (a) Retainer: A non-refundable retainer equal to $160,000. (b) Monthly Fee: $80,000 per month. (c) Completion Fee: $4,800,000 upon the earlier of (i) the confirmation and effectiveness of a Plan and (ii) the closing of a Restructuring Transaction. (d) M&A Fee: Upon the closing of an M&A Transaction, 0.4 percent of the Aggregate Consideration involved in any M&A Transaction. (e) New Capital Fee: A fee equal to (but which in the aggregate shall not exceed $5,400,000): -- 0.4 percent of the face amount of any senior secured debt raised; -- 0.8 percent of the face amount of any junior secured or senior or subordinated unsecured debt raised; and -- 1.6 percent of any equity capital, capital convertible into equity or hybrid capital raised, including, without limitation, equity underlying any warrants, purchase rights, or similar contingent equity securities. For the avoidance of doubt, clauses (i) through (iii) above shall include, without limitation, any debtor-in-possession financing raised; provided, however, that if any such debtor- in-possession financing converts to an exit facility, no additional Petrie New Capital Fee shall be payable except to the extent that the amount raised (as defined herein) of such exit facility exceeds the outstanding amount of such debtor- in-possession financing at the time of such conversion. The Petrie New Capital Fee shall be payable upon the closing of the transaction by which the new capital is committed. For the avoidance of doubt, the term "raised" means the amount of new funds committed or otherwise made available to the Debtors whether or not such amount (or any portion thereof) is drawn down at closing or is ever drawn down and whether or not such amount (or any portion thereof) is used to refinance existing obligations of the Debtors. For the further avoidance of doubt, the Petrie New Capital Fee relating to any warrants, purchase rights, or similar contingent equity securities shall be due and payable upon the closing of the transaction by which such instruments are issued and shall be calculated as if all such instruments are exercised in full (and the full cash exercise price is paid)on the date of such closing, whether or not all or any portion of such instruments are vested and whether or not such instruments are actually so exercised. Notwithstanding the foregoing, if a Restructuring Transaction or an M&A Transaction consists of any Acquirer acquiring "control" (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) of the Debtors for cash (whether or not while acting as a "plan sponsor" of a Plan), no Petrie New Capital Fee shall be payable with respect to such cash purchase price paid by such Acquirer; provided, however, if new debt capital is raised as part of such transaction or Plan, a Petrie New Capital Fee shall remain payable with respect to such new debt capital; provided, further, that such new debt capital shall not be double counted in calculating the Petrie New Capital Fee and the Aggregate Consideration with respect to any Petrie M&A Fee; provided, further, that if such transaction or Plan includes the issuance of purchase rights (e.g., a rights offering), warrants, or similar contingent equity securities, then a Petrie New Capital Fee shall remain payable with respect to such purchase rights, warrants, or similar contingent equity securities. Notwithstanding anything herein to the contrary and for the avoidance of doubt, no Petrie New Capital Fee shall be payable on account of a transaction that does not result in new capital having been raised (as defined above), including on account of "take-back" debt or equity. (f) In the event the Debtors enter into a transaction that constitutes both a Restructuring Transaction and an M&A Transaction, Petrie shall be entitled to elect to receive the higher of the Petrie Completion Fee and the Petrie M&A Fee. (g) Credit: Petrie shall credit against its Completion Fee: (a) 50 percent of Petrie's Monthly Fees paid in excess of $320,000 (such credit, the "Petrie Monthly Fee Credit"); (b) 50 percent of any M&A Fees paid to Petrie (such credit, the "Petrie M&A Fee Credit"); and (c) to the extent not otherwise applied against the fees and expenses of Petrie under the terms of the Engagement Letter, Petrie's Retainer; provided that the sum of any Petrie M&A Fee Credit and the Petrie Monthly Fee Credit shall not exceed Petrie's Completion Fee. (h) Cap: The aggregate amount of fees due and owing to Petrie from the Debtors pursuant to clauses (c), (d), and (e) above shall not exceed, after accounting for any applicable credits, $10,200,000. Todd Snyder, executive vice chairman and co-chair of the North American Debt Advisory and Restructuring Group of the investment banking firm Rothschild Inc., and Mark L. Carmain, managing director of the investment banking firm Petrie Partners Securities, LLC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Rothschild and Petrie can be reached at: Todd Snyder Rothschild Inc. 1251 Avenue of the Americas New York, NY 10020 Tel: (212) 403-3500 Fax: (212) 403-3501 - and - Mark L. Carmain Petrie Partners Securities, LLC 1700 Lincoln Street, Denver,CO 80203 Tel: (303) 953-6768 About Ultra Petroleum Ultra Petroleum Corp. is an independent oil and gas company engaged in the development, production, operation, exploration and acquisition of oil and natural gas properties. Ultra Petroleum Corp. and its affiliates filed separate Chapter 11 petitions (Bankr. S.D. Tex. Case Nos. 16-32202 to 16-32209) on April 29, 2016. The Hon. Marvin Isgur presides over the cases. James H.M. Sprayregen, P.C., David R. Seligman, P.C., Michael B. Slade, Esq., Christopher T. Greco, Esq., and Gregory F. Pesce, Esq., at KIRKLAND & ELLIS LLP; and Patricia B. Tomasco, Esq., Matthew D. Cavenaugh, Esq., and Jennifer F. Wertz, Esq., at JACKSON WALKER, L.L.P., serve as counsel to the Debtors. Rothschild Inc. serves as the Debtors' investment banker; Petrie Partners serves as their investment banker; and Epiq Bankruptcy Solutions, LLC, serves as claims and noticing agent. Ultra Petroleum Corp. listed total assets of $1.28 billion and total liabilities of $3.91 billion as of March 31, 2016. The petitions were signed by Garland R. Shaw, chief financial officer. The Company's common stock commenced trading on the OTC Pink Marketplace under the symbol "UPLMQ" on May 3, 2016. The Office of the U.S. Trustee has appointed seven creditors of Ultra Petroleum Corp. to serve on the official committee of unsecured creditors. UNIVERSAL SOFTWARE: Hires Riley & Dever as Chapter 11 Counsel ------------------------------------------------------------- Universal Software Corporation, seeks authority from the U.S. Bankruptcy Court for the District of Massachusetts to employ George J. Nader, of Riley & Dever, P.C. as Counsel to the Debtor. Universal Software requires Nader to: (a) assist the Debtor in preparing schedules, statement of financial affairs and related documents with the court; (b) employ professionals to assist in the reorganization of the Debtors; (c) effectuate a reorganization of the Debtor's estates by filing the appropriate plans of reorganizations and disclosure statements, including any amendments thereto, and defending against any motions to dismiss and/or for relief from the stay; (d) assist the Debtor in complying with Chapter 11 reporting and operations requirements, including filing necessary reports. (e) negotiate with creditors for adequate protection and the use of cash collateral, assumption or rejection of leases and/or executory contracts, objection to claims and related issues. Nader will be paid $400 an hour. Nader will also be reimbursed for reasonable out-of-pocket expenses incurred. George J. Nader, of Riley & Dever, P.C., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Nader can be reached at: George J. Nader, Esq. RILEY & DEVER, P.C. Lynnfield Woods Office Park 210 Broadway, Suite 101 Lynnfield, MA 01940-2351 Tel: (781) 581-9880 Fax: (781) 581-7301 E-mail: nader@rileydever.com About Universal Software Universal Software Corporation filed for Chapter 11 protection (Bankr. D. Mass. Case No. 16-40872) on May 18, 2016. The petition was signed by Kishore Deshpande, president. The Hon. Christopher J. Panos presides over the case. The Debtor estimated assets of $1 million to $10 million and estimated liabilities of $1 million to $10 million. US ENERGY MANAGEMENT: Seeks to Hire Spigner as Legal Counsel ------------------------------------------------------------ US Energy Management, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire Spigner & Associates, P.C. as its legal counsel. The Debtor tapped the firm to: (a) give the Debtor legal advice about its powers and duties in the continued operation of its business and management of its property; (b) investigate and recover fraudulent or preferential transfers of the Debtor's property before its bankruptcy filing; (c) institute appropriate proceedings for sale of property and assist in obtaining post-petition financing; (d) defend the Debtor in contested matters or adversary proceedings; (e) prepare legal papers on behalf of the Debtor; and (f) provide general advice to the Debtor concerning its conduct and responsibilities under Chapter 11 and to perform all other necessary legal services. Reedy Macque Spigner, the attorney primarily responsible for representing the Debtor, will be paid $450 per hour for his services. Mr. Spigner will be assisted by associate attorney Denise Turnbull and paralegals who will be paid $200 and $90 per hour, respectively. In a court filing, Mr. Spigner disclosed that the firm is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Reedy Macque Spigner Spigner & Associates, P.C. 555 Republic, #430 Plano, TX 75074 Phone: 972-881-0581 Email: spigner@glocktech.net About US Energy Management US Energy Management, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 16-31941) on May 12, 2016, listing $100,001 to $1,000,000 in both assets and liabilities. VERSO CORPORATION: Wants to Enter into Engagement Letters --------------------------------------------------------- Verso Corporation and its affiliated debtors ask the U.S. Bankruptcy Court for the District of Delaware to authorize them to enter into and perform under engagement letters and fee letters relating to exit financing. The Debtors seek authorization to enter into and perform under the following: (i) the Engagement Letter between Verso Paper Holdings LLC and Wells Fargo Bank, National Association relating to the Exit ABL Facility ("WF Engagement Letter"); (ii) the Engagement Letter between Verso Corporation, Verso Paper Finance Holdings LLC, and Verso Paper, on the one hand, and Barclays Bank PLC, on the other, relating to the Exit Term Loan Facility ("Barclays Engagement Letter"); and (iii) certain fee letters with Wells Fargo and Barclays "With the Court having approved the Disclosure Statement, the Debtors are now poised to confirm the Plan, which enjoys broad creditor support, and emerge from bankruptcy within the next few months. Solidifying exit financing commitments is critical to the Debtors' ability to consummate that Plan, and the Debtors' entry into and performance under the Engagement Letters and Fee Letters represents an important gating item in that process. The Plan provides for the Debtors to enter into two exit financing facilities: the Exit ABL Facility and the Exit Term Facility, pursuant to which the Debtors expect to have access to between $575 and $650 million in financing, which is necessary to refinance the Debtors' existing DIP Facilities, fund distributions under the Plan and provide post-emergence liquidity to the reorganized Debtors. Entry into these exit financing facilities is a condition precedent to consummation of the Plan, and the applicable credit agreements must be approved in connection with confirmation," the Debtors aver. The WF Engagement Letter and related Fee Letter contains, among others, the following key terms: (1) Roles; Syndication: The Debtors will engage Wells Fargo to act as lead arranger and bookrunner for the structuring, arranging and syndication of the Exit ABL Facility on the terms set forth in the WF Engagement Letter. Wells Fargo will use commercially reasonable efforts to assemble a syndicate of financial institutions as lenders under the Exit ABL Facility to provide the necessary asset-based revolving financing commitments of up to $375,000,000. Wells Fargo will serve as sole and exclusive administrative agent and collateral agent under the Exit ABL Facility except as otherwise agreed by Wells Fargo. (2) Expenses: Regardless of whether the closing date of the Exit ABL Facility occurs, the Debtors will pay or reimburse all reasonable and documented out-of- pocket fees, costs and expenses incurred by Wells Fargo or its affiliates in connection with their due diligence, approval, documentation, syndication and closing of the Exit ABL Facility, including but not limited to reasonable and documented attorneys' fees and legal expenses of one primary counsel and one local counsel for Wells Fargo. The Debtors will provide to Wells Fargo a deposit of $250,000 to be applied to such reimbursable fees, costs and expenses. The Barclays Engagement Letter and related Fee Letter contains, among others, the following key terms: (1) Engagement; Roles; Syndication: The Debtors will engage Barclays to act as lead arranger and bookrunner for the structuring, arranging and syndication of the Exit Term Loan Facility on the terms set forth in the Barclays Engagement Letter. Barclays agrees to use commercially reasonable efforts to arrange a syndicate of lenders to provide the Exit Term Loan Facility in the anticipated principal amount of $200,000,000. Barclays will act as lead arranger and bookrunner for the Exit Term Loan Facility, and will be offered the right to act as sole administrative agent and collateral agent for the Exit Term Loan Facility. (2) Conditions: Barclays' agreements under the Barclays Engagement Letter are subject to the satisfaction of certain conditions, including: (a) the absence of developments having a material adverse effect since December 31, 2015; (b) the Debtors' material performance under the Barclays Engagement Letter and payment of fees and expenses; (c) entry of an order, by no later than June 3, 2016 (or any earlier applicable date pursuant to the Barclays Engagement Letter), which order will be in form and substance reasonably satisfactory to Barclays, authorizing the Debtors to accept and incur obligations under the Barclays Engagement Letter; (d) no dismissal or conversion of the Debtors' chapter 11 cases; (e) the Debtors not filing or supporting any plan of reorganization or liquidation other than the Plan; (f) negotiation, execution and delivery of definitive documentation with respect to the Exit Term Loan Facility; (g) effectiveness of the Exit ABL Facility at closing of the Exit Term Loan Facility; (h) receipt of the credit ratings described above; and (i) other closing conditions agreed to in the definitive documentation for the Exit Term Loan Facility. Verso Corporation and its affiliated debtors are represented by: Mark D. Collins, Esq. Michael J. Merchant, Esq. Amanda R. Steele, Esq. RICHARDS, LAYTON & FINGER, P.A. One Rodney Square 920 North King Street Wilmington, DE 19801 Telephone: (302)651-7700 Facsimile: (302)651-7701 E-mail: collins@rlf.com merchant@rlf.com steele@rlf.com - and - George A. Davis, Esq. Peter Friedman, Esq. Andrew M. Parlen, Esq. Andrew D. Sorkin, Esq. O'MELVENY & MYERS LLP Times Square Tower Seven Times Square New York, NY 10036 Telephone: (212)326-2000 Facsimile: (212)326-2061 E-mail: gdavis@omm.com pfriedman@omm.com aparlen@omm.com asorkin@omm.com About Verso Corporation Verso Corporation claims to be the leading North American producer of coated papers, which are used primarily in magazines, catalogs, high-end advertising brochures and annual reports, among other media and marketing publications. It employs approximately 5,200 personnel. Verso Corporation and 26 of its affiliates, including NewPage Corporation, filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10163 to 16-10189, respectively) on Jan. 26, 2016. The petitions were signed by David Paterson, the president and CEO. The Debtors disclosed total assets of $2.9 billion and total debts of $3.87 million. The Debtors have engaged O'Melveny & Myers LLP as general counsel, Paul, Weiss, Rifkind, Wharton & Garrison LLP as corporate counsel, Richards, Layton & Finger, P.A. as Delaware counsel, PJT Partners L.P. as investment banker, Alvarez & Marsal North America, LLC as financial advisor and Prime Clerk LLC as claims and noticing agent. The U.S. Trustee for Region 3 has appointed seven creditors of Verso Corp. and its affiliates to serve on the official committee of unsecured creditors. WARNER MUSIC: Noreena Hertz Quits as Director --------------------------------------------- Noreena Hertz resigned from her position as a member of the Board of Directors of Warner Music Group Corp. on May 22, 2016, having taken a new position at ITV, according to a regulatory filing with the Securities and Exchange Commission. About Warner Music Group Based in New York, Warner Music Group Corp. (NYSE: WMG) -- http://www.wmg.com/-- was formed by a private equity consortium of investors on Nov. 21, 2003. The Company is the direct parent of WMG Holdings Corp., which is the direct parent of WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's major music-based content companies and the successor to substantially all of the interests of the recorded music and music publishing businesses of Time Warner Inc. The Company classifies its business interests into two fundamental operations: Recorded Music and Music Publishing. The Company's Recorded Music business primarily consists of the discovery and development of artists and the related marketing, distribution and licensing of recorded music produced by such artists. The Company's Music Publishing operations include Warner/Chappell, its global Music Publishing company, headquartered in New York with operations in over 50 countries through various subsidiaries, affiliates and non-affiliated licensees. In May 2011, Warner Music Group Corp. and Access Industries, the U.S.-based industrial group, announced the execution of a definitive merger agreement under which Access Industries will acquire WMG in an all-cash transaction valued at $3.3 billion. The purchase includes WMG's entire recorded music and music publishing businesses. On July 20, 2011, the Company notified the New York Stock Exchange, Inc., of its intent to remove the Company's common stock from listing on the NYSE and requested that the NYSE file with the SEC an application on Form 25 to report the delisting of the Company's common stock from the NYSE. On July 21, 2011, in accordance with the Company's request, the NYSE filed the Form 25 with the SEC in order to provide notification of that delisting and to effect the deregistration of the Company's common stock under Section 12(b) of the Securities Exchange Act of 1934, as amended. On August 2, 2011, the Company filed a Form 15 with the SEC in order to provide notification of a suspension of its duty to file reports under Section 15(d) of the Exchange Act. The Company continues to file reports with the SEC pursuant to the Exchange Act in accordance with certain covenants contained in the instruments governing the Company's outstanding indebtedness. Warner Music reported a net loss attributable to the Company of $91 million on $2.96 billion of revenues for the fiscal year ended Sept. 30, 2015, compared to a net loss attributable to the Company of $308 million on $3.02 billion of revenues for the fiscal year ended Sept. 30, 2014. As of March 31, 2016, Warner Music had $5.48 billion in total assets, $5.25 billion in total liabilities and $234 million in total equity. * * * As reported by the TCR on Oct. 23, 2015, Standard & Poor's Ratings Services lowered its corporate credit rating on New York City-based Warner Music Group Corp. (WMG) to 'B' from 'B+'. "The downgrades reflect our expectations that WMG's adjusted leverage will remain elevated for the next two years -- above our 5x threshold for the 'B+' corporate credit rating," said Standard & Poor's credit analyst Naveen Sarma. WASHINGTON FIRST: Case Summary & 7 Unsecured Creditors ------------------------------------------------------ Debtor: Washington First Financial Group, Inc. 4957 Lakemont Blvd SE, C4-248 Bellevue, WA 98006 Case No.: 16-12848 Type of Business: Operates as a bank holding company Chapter 11 Petition Date: May 26, 2016 Court: United States Bankruptcy Court Western District of Washington (Seattle) Debtor's Counsel: Jeffrey L Smoot, Esq. OLES MORRISON RINKER & BAKER LLP 701 Pike Street, Suite 1700 Seattle, WA 98101 Tel: 2064677450 Fax: 2066826234 E-mail: smoot@oles.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The petition was signed by Elizabeth Huang, president. List of Debtor's Seven Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Chi-Wen Chuang Promissory Note $379,836 #1 Lane 78 Shi-Dong Rd Shih-Lin District Taipei, Taiwan Dun Jung Liu Promissory Note $178,048 FDIC Reimbursement $34,262,045 c/o Sonia L. Levine Counsel-Legal Division 3501 Fairfax Drive Arlington, VA 22226 Mei Hwa Ting Note & Assignment $51,234 Agreement Michael Ching Kit Note & Assignment $72,230 Margaret Kit Man Agreement Kwan Ronnie K.B. Liem Promissory Note $221,447 Ronnie K.B. Liem Promissory Note $58,432 WEST CORP: Moody's Rates New Term Loans Ba3 ------------------------------------------- Moody's Investors Service assigned a Ba3 (LGD3) rating to West Corporation's approximately $1.2 billion of new senior secured term loan facilities and the $300 million revolving credit facility. West's B1 Corporate Family Rating (CFR), the Ba3 and B3 ratings for its existing senior secured and senior unsecured debt, respectively, and its SGL-1 speculative grade liquidity rating remain unchanged. The ratings outlook is stable. The company will use net proceeds from the new term loans to refinance existing senior secured term loans. Moody's will withdraw ratings on the existing term loans and revolving credit facility to the extent that existing loans are fully repaid and cancelled as part of the refinancing transactions. RATINGS RATIONALE The proposed transactions will extend the debt maturities of term loans and are leverage-neutral. West's B1 Corporate Family Rating (CFR) reflects its high financial leverage of 5.1x (Moody's adjusted), Moody's expectation for modest revenue growth of about 1% to 2% over the next 12 to 18 months on an organic, constant currency basis and stable EBITDA margins. Organic revenue growth in 2016 will be constrained by the loss of a large telecom services customer that was announced in August 2015. Moody's expects West's leverage to remain in the range of 4.9x to 5.0x over the next 12 to 18 months. The rating additionally reflects West's highly competitive operating environment and technology risks, and the company's acquisitive growth strategy to diversify its revenues. The rating is supported by West's good operating scale and leading market positions in the conferencing and collaboration and emergency communication service markets. Moody's expects West to generate free cash flow of about 5% of total debt in the next 12 to 18 months. The stable ratings outlook reflects Moody's expectation that West will generate good free cash flow relative to total debt and leverage will remain stable over the next 12 to 18 months. The SGL-1 speculative grade liquidity rating reflects West's very good liquidity comprising free cash flow, cash balances and total availability of at least $400 million under its revolving credit and account receivables securitization facilities. Moody's does not anticipate a ratings upgrade given West's limited organic growth prospects and expected leverage levels in the intermediate term. However, West's ratings could be upgraded over time if debt reduction or strong profitability results in total debt to EBITDA below 4.5x and free cash flow to debt (after dividends) increases to the high single digit percentages on a sustainable basis. West's ratings could be downgraded if weak operating performance, debt-funded acquisitions or shareholder-friendly financial policies result in deterioration of liquidity, or total debt / EBITDA increases above 5.5x or free cash flow to debt declines to the low single percentages. Moody's has taken the following ratings actions: Issuer: West Corporation -- New senior secured term loan A and B credit facilities Assigned Ba3 (LGD3) New senior secured revolving credit facility -- Assigned Ba3 (LGD3) West Corporation is a leading provider of technology-enabled communications services with approximately $2.3 billion in revenues from continuing operations. Thomas H. Lee Funds, Quadrangle Group Funds, Gary L. West, Mary E. West, and members of management hold about 45% of the common stock. WEST CORP: Proposes to Refinance Existing Debt ---------------------------------------------- West Corporation announced it is proposing, subject to market and other conditions, to refinance and extend the maturity date for a portion of the loans under its existing Amended and Restated Credit Agreement. West expects to refinance or extend its existing indebtedness through some or all of the following: * Extension of its existing $300 million revolving credit facility, currently set to mature July 2019; * Extensions and/or incremental increases of existing term A-1 loans, currently set to mature July 2019, and existing term B-10 loans, currently set to mature June 2018, into new term A-2 loans, and new term B-12 loans, respectively, totaling approximately $1.2 billion or more depending on market conditions; and * Other first-lien senior secured debt. Expected future maturities on the above-mentioned refinancing are between 2021 and 2023. The proceeds of the combined refinancing will be used primarily for repayment or extension of term B-10 loans, currently set to mature June 2018. Wells Fargo Bank, N.A. is administrative agent under West's credit facility. West cannot provide any assurances about the timing, terms or interest rate associated with the planned refinancing, or that the refinancing transactions can be completed at all. About West Corporation Omaha, Neb.-based West Corporation is a global provider of communication and network infrastructure solutions. West helps manage or support essential enterprise communications with services that include conferencing and collaboration, public safety services, IP communications, interactive services such as automated notifications, large-scale agent services and telecom services. West Corporation reported net income of $242 million on $2.28 billion of revenue for the year ended Dec. 31, 2015, compared to net income of $158 million on $2.21 billion of revenue for the year ended Dec. 31, 2014. As of March 31, 2016, West Corp had $3.52 billion in total assets, $4.05 billion in total liabilities and a total stockholders' deficit of $536 million. * * * As reported by the TCR on June 21, 2013, Standard & Poor's Ratings Services raised its corporate credit rating on West Corp. to 'BB-' from 'B+'. The upgrade reflects Standard & Poor's view that lower debt leverage and a less aggressive financial policy will strengthen the company's financial profile. In the April 4, 2013, edition of the TCR, Moody's Investor Service upgraded West Corporation's Corporate Family Rating to 'B1' from 'B2'. "The CFR upgrade to B1 reflects West's shift to a more conservative capital structure and financial policies as a publicly owned company," stated Moody's analyst Suzanne Wingo. WILLIAMS COS: S&P Puts 'BB' CCR on CreditWatch Negative ------------------------------------------------------- S&P Global Ratings placed its 'BB' corporate credit rating and other ratings on U.S. midstream energy company The Williams Cos. Inc. on CreditWatch with negative implications. The '4' recovery rating on the senior unsecured debt is unchanged and indicates expectations of average (30%-50%; higher end of the range) recovery if a default occurs. The '6' recovery rating on the junior subordinated notes is also unchanged and indicates negligible recovery (0%-10%) if a default occurs. "The rating action reflects our expectation that ETE's stand-alone financial leverage pro forma for its merger with The Williams Cos. Inc. will be considerably weaker than our previous expectations," said S&P Global Ratings credit analyst Michael Grande. S&P revised its assessment of the merged company's pro forma stand-alone debt leverage to negative from neutral based on its expectation that debt to EBITDA (defined as distributions from its subsidiaries minus general and administrative expenses) will be almost 7x annualized (8x on a trailing 12-month basis) in 2016 from S&P's previous expectations of between 3.5x to 4x in 2016. The merger transaction faces both industry and legal headwinds, with weaker commodity prices and lower expected commercial synergies that have decreased from about $2 billion to $126 million as key drivers of the revised credit measures. S&P's projections still assume ETE funds up to $6 billion of the transaction's cash consideration almost entirely with debt plus some excess cash flow. S&P's forecast also assumes that distributions to the combined company are lower, mainly due to incentive distribution right (IDR) subsidies that benefit the underlying MLPs' distribution coverage ratios and credit profiles. That said, S&P expects ETE uses a significant portion excess cash flow after distributions to repay debt in 2017 and 2018, leading to debt to EBITDA of about 5.9x and 3.8x, respectively. S&P expects to resolve the CreditWatch listing upon close of the merger with ETE, at which time S&P expects to lower its rating on Williams by two notches to 'B+', in line with ETE's rating. WINGS OF MEDINA: Wants Plan Filing Deadline Moved to Aug. 12 ------------------------------------------------------------ Wings of Medina Liquidation, Inc., et al., ask the Hon. Alan M. Koschik of the U.S. Bankruptcy Court for the Northern District of Ohio to extend by 60 days (i) the exclusivity period through and including Aug. 12, 2016, from June 13, 2016; and (ii) the solicitation period through and including Oct. 11, 2016, from Aug. 12, 2016. On March 25, 2016, the Court entered an order (a) authorizing the sale of substantially all of the Debtors' assets to TravelCenters of America, LLC, free and clear of all liens, claims, encumbrances and interests; (b) authorizing the assumption and assignment of certain executory contracts and unexpired leases. On April 20, 2016, the Debtors and TravelCenters closed the sale in accordance with the provisions of the Sale Order. The Debtors are in the process of winding down their affairs and administering their remaining assets through the Chapter 11 cases. While the sale was approved on March 25, 2016, it did not close until April 20, 2016. Since the Closing Date, the Debtors have been working on various case matters relating to purchase price calculations, cure cost issues, objections to claims, rejection of leases and identifying miscellaneous assets for sale. All of these issues will have some bearing on a plan of liquidation. The Debtors believe that a post-sale Chapter 11 plan is the most efficient method to distribute assets and provide for an orderly distribution on account of the obligations the Debtors owe to their creditors and other constituents. The Debtors fully anticipate that they will work with the Official Committee of Unsecured Creditors on formulating the mechanics of a Chapter 11 liquidating plan with the goal of proposing a joint plan. However, in light of the delays associated with closing the sale to TravelCenters and the related issues generated by the same -- commencing litigation with former franchisees, objecting to claims and addressing miscellaneous assets (to name a few) -- the Debtors are still working on finalizing the data necessary for formulation of a liquidating plan. The Debtors needed the sale process to conclude before they could gather sufficient information necessary to prepare a disclosure statement and propose a plan that can garner the support of all constituents. Moreover, the governmental claims bar date just occurred on May 20, 2016. Therefore, the Debtors are working to understand the magnitude of the claims pool as part of finalizing the structure of a plan. The Debtors are also in the process of working to resolve post-sale cure issues and other contested matters with certain of their former franchisees. The resolution of these issues will have a material impact on distributions to creditors and the ultimate mechanics of a liquidating plan. During the extended Exclusivity Period, the Debtors will proceed in good faith in working with the Committee to formulate and propose a joint plan. The Debtors have been fully cooperative with parties in interest and are keeping major constituencies in the cases apprised of the Debtors' restructuring efforts. However, due to the size and complexity of the cases, and the various unresolved contingencies, the Debtors need additional time to finalize the sale process and negotiate and formulate the structure of a plan. The Debtors' Chapter 11 cases are large and complex enough to justify a further extension. The Debtors consist of 27 separate legal entities and hundreds of creditors. The Debtors are paying postpetition obligations as they become due (within ordinary business practices). Wings of Medina Liquidation, Inc., et al., each filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. Case No. 15-52722) on Nov. 16, 2015. The Debtor is represented by: Scott N. Opincar, Esq. Michael J. Kaczka, Esq. McDONALD HOPKINS LLC 600 Superior Avenue, East, Suite 2100 Cleveland, OH 44114-2653 Tel: (216) 348-5400 Fax: (216) 348-5474 E-mail: sopincar@mcdonaldhopkins.com mkaczka@mcdonaldhopkins.com YUM! BRANDS: Moody's Assigns Ba1 Rating on Proposed Revolver Loan ----------------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Yum! Brands, Inc.'s subsidiaries' proposed senior secured revolver and proposed senior secured term loans and a B1 rating to its proposed senior unsecured notes. The proposed bank facilities and proposed senior unsecured notes will be issued by direct subsidiaries of Yum. In addition, Moody's affirmed Yum's Ba3 Corporate Family Rating, Ba3-PD Probability of Default Rating, and the SGL-1 Speculative Grade Liquidity Rating. Moody's also downgraded the unsecured legacy notes of Yum to B2 from B1. The outlook is negative. Proceeds from the proposed senior secured credit facility and proposed senior unsecured notes will be used to repay existing bank debt and partially fund Yum's target of returning $6.2 billion of capital to shareholders through a combination of share repurchases and/or dividends. The proposed transaction follows Yum's announcement that it entered into a $2.3 billion securitization of senior notes securitized by the domestic royalties of its Taco Bell business. "Moody's views the proposed recapitalization of Yum's capital structure as very aggressive and the culmination of the company's commitment of returning substantial capital to shareholders and transitioning to a highly leveraged company with a stated unadjusted leverage target of approximately 5 times," stated Bill Fahy, Moody's Senior Credit Officer. "While the proposed recapitalization provides clarity around the company's capital structure, Yum's willingness to strengthen credit metrics as it executes its shareholder and refranchising initiatives and the separation of its China business is uncertain given management's various policies to date," stated Fahy. Downgrades: Issuer: Yum! Brands Inc. -- Senior Unsecured Regular Bond/Debenture, Downgraded to B2(LGD5) from B1(LGD4) -- Senior Unsecured Shelf, Downgraded to (P)B2 from (P)B1 Assignments: Issuer: KFC Holding Co. -- Senior Secured Bank Credit Facility (Local Currency), Assigned Ba1 (LGD2) -- Senior Unsecured Regular Bond/Debenture (Local Currency), Assigned B1(LGD4) Outlook Actions: Issuer: KFC Holding Co. -- Outlook, Assigned No Outlook Issuer: Yum! Brands Inc. -- Outlook, Remains Negative Affirmations: Issuer: Yum! Brands Inc. -- Probability of Default Rating, Affirmed Ba3-PD -- Speculative Grade Liquidity Rating, Affirmed SGL-1 -- Corporate Family Rating, Affirmed Ba3 RATINGS RATIONALE The Ba3 Corporate Family Rating reflects Yum's significant scale, geographic reach, brand diversity and franchise based business model which helps to add stability to revenues and earnings as compared to some other restaurant operators and reduces overall capital requirements. The ratings also factor in the reduced earnings volatility that should result from separating Yum's China operations to a franchise licensing fee as well as the company's very good liquidity. The ratings also incorporate Yum's aggressive financial policy that will result in a material deterioration in credit metrics as it increases debt and completes its target of returning about $6.2 billion to shareholders by the end of 2016. The Ba1 rating on the proposed bank facilities reflect the support from the material amount of liabilities that are junior to these facilities, including the proposed unsecured notes and existing legacy notes. Moody's also ranks the proposed bank facilities pari passu with Yum's Taco Bell securitization debt in a distressed scenario for loss given default purposes. The B1 rating on the proposed senior unsecured notes reflect the notes junior position to the significant amount of secured bank and securitization debt but also factors in the benefit of its structurally senior position to Yum's $2.2 billion of legacy notes. The B2 rating on Yum's unsecured legacy notes reflects their junior position to the significant amount of secured and structurally senior unsecured debt. In the event the proposed refinancing did not happen the rating on the existing revolving credit facility at Yum could be negatively impacted. In addition, all ratings factor in the expected spin-off of Yum's China operations to shareholders and to a franchised business model by the end of 2016. The negative outlook reflects Moody's concerns regarding Yum's credit metrics longer term once the separation of Yum China is complete and additional refranchising initiatives are realized under the proposed new capital structure. Yum's ratings could be downgraded in the event operating performance declined or the company's financial policies resulted in a sustained deterioration in credit metrics with adjusted debt to EBITDA above 5.5 times or EBIT to Interest below 2.5 times. Whereas an upgrade would require a demonstrated improvement in Pizza Hut and continued improvement in KFC and Taco Bell that resulted in Moody's adjusted debt to EBITDA below 4.75 times and EBIT to Interest above 3.0 times on a sustained basis. Maintaining good liquidity would also be required for an upgrade. Yum! Brands, Inc., headquartered in Louisville, Kentucky, is an owner, operator and franchisor of quick service and casual dining restaurants with brands that include KFC, Taco Bell, and Pizza Hut. Revenues for the LTM period ending March 19, 2016 were over $13 billion. The principal methodology used in these ratings was Restaurant Industry published in September 2015. ZOHAR CDO 2003: Fund's Suit Against Patriarch Set for Fast Trial ---------------------------------------------------------------- Peg Brickley, writing for Daily Bankruptcy Review, reported that turnaround executive Lynn Tilton could find herself on the witness stand in a Delaware court by early August, facing questions from new managers of the Zohar funds, the $2.5 billion distressed-debt investing operation she founded. According to the report, on May 27, Vice Chancellor Joseph Slights of Delaware's Court of Chancery set a fast track for a trial on a dispute between Ms. Tilton's Patriarch Partners and Alvarez & Marsal, the firm that replaced her as manager of the Zohar funds. Judge Slights ordered the trial by Aug. 12 in his court, unless Alvarez & Marsal and Patriarch repackage the pleadings and press ahead in a New York court where a separate legal battle is now pending, the report related. As previously reported by The Troubled Company Reporter, citing DBR, pressure is mounting on Lynn Tilton as new managers struggle to make sense of the $2.5 billion distressed-debt investing operation she founded. According to the report, Vice Chancellor Joseph Slights of Delaware's Court of Chancery said on May 25 that a quick decision is needed on a request for more information about Ms. Tilton's operation. The report related that Alvarez & Marsal, the new manager of the Zohar funds that Ms. Tilton created and managed for years, says it needs a court order to force her private-equity firm, Patriarch Partners, to provide more information about the investments in the funds to deal with a looming default on $750 million worth of notes. Patriarch says it has handed over all the information it is required to, the report related. The three Zohar funds are made up of troubled companies' loans as well as ownership stakes in some of the companies, the report noted. Alvarez & Marsal stepped in in March, when Ms. Tilton stepped away to tend to the portfolio of troubled companies managed by Patriarch, the report recalled. There is a need for swift action on the dispute, Judge Slights said, but he hasn't decided whether that action should come from Delaware's Court of Chancery, where he sits, or from state court in New York, where part of the dispute is brewing, the report added. About Zohar CDO 2003-1 Patriarch Partners XV, LLC filed involuntary Chapter 11 bankruptcy petitions against Zohar CDO 2003-1, Corp., Zohar CDO 2003-1, Limited and Zohar CDO 2003-1, LLC (Bankr. S.D.N.Y. Case Nos. 15-23681 to 15-23682) on Nov. 22, 2015. Patriarch Partners disclosed that it has filed, through one of its affiliates, an involuntary Chapter 11 petition for Zohar CDO 2003-1, Limited. Patriarch is Zohar I's largest creditor, holding $286.5 million face amount of Zohar I notes. Patriarch has placed Zohar I into Chapter 11 in order to protect Zohar I and Patriarch from the efforts of MBIA Inc. and MBIA Insurance Corporation, another creditor of Zohar I, to obtain Zohar I's assets for itself. Patriarch claimed it has been forced to pursue this route because of MBIA's fraudulent scheme to induce Patriarch XV to spend over $103 million to buy out a third-party noteholder in Zohar-I to facilitate a restructuring of Zohar-I. Lynn Tilton is CEO of Patriarch. Patriarch's restructuring counsel is Skadden, Arps, Slate, Meagher & Flom LLP and its financial advisor is Moelis & Co. ZYNEX INC: Appoints VP of Finance and VP of Operations ------------------------------------------------------ Mr. Rick Luckenbill commenced employment at Zynex, Inc., to serve as the Company's vice president of finance on May 23, 2016. Mr. Luckenbill will report to the Company's chief executive officer, Thomas Sandgaard, be in charge Company's accounting operations and support the Company's finance operations. Mr. Luckenbill has more than 20 years' experience in multiple industries with proven leadership in finance, accounting and system integration roles. Mr. Lukenbill's work experience includes debt restructure, cash flow optimization, profitability improvement and system integration. Prior to joining Zynex, Mr. Luckenbill, during 2015 and 2016, served as chief financial officer/vice president of Finance with CPP, Inc., an engineering consulting business in Fort Collins, CO. Previously, Mr. Luckenbill served in various accounting roles with Medtronic, Inc. (2013-2015), Thermo Fisher Scientific, Inc (2009-2011), Omnitrax, Inc (2009) and Motorola, Inc. (1996-2009) and as director of systems integration with Motorola Solutions, Inc. (2011-2013). Mr. Luckenbill holds an MBA, Finance from the Keller Graduate School of Management of DeVry University, Scottsdale, AZ and a BS, Finance/Organizational Development, Elmhurst College, Elmhurst, IL. On June 1, 2016, Mr. David Mogill will commence employment at Zynex, Inc. to serve as the Company's vice president of operations. Mr. Mogill will report to the Company's chief executive officer, Thomas Sandgaard and be in charge Company's production and supply chain operations. Mr. Mogill is replacing Robert Cozart, who is retiring after 9 years of service with the Company. Mr. Mogill has more than 30 years' experience in the medical device industry with proven leadership in production, supply chain and operational process efficiency roles. Prior to joining Zynex, Mr. Mogill served as Sector SQE with Surgical Technologies (2015-2016) and Solta Medical/SST (2008-2014), Previously, Mr. Mogill served in various operations management positions with Glucon Inc. (2006-2007), Dentsply International (2004 - 2006) and various other medical device manufacturing companies (1986 - 2006). Mr. Mogill holds a BS in Mechanical Engineering Technology from Metro State University of Denver. There were no arrangements or understandings between Mr. Luckenbill or Mr. Mogill and any other person pursuant to which he was appointed as Vice President of Finance and there is no family relationship between Mr. Luckenbill and any officer or director of the Company. There have been no transactions between Mr. Luckenbill and the Company required to be disclosed by Item 404(a) of Regulation S-K. Effective May 16, 2016, Michael Hartberger resigned as the chief operating officer of Zynex, Inc. His decision was on account of the Company's continuing cash constraints. There were no expressed disagreements with management or Company practices or policies. C Squared Solutions, who (since October 2015) provided interim Chief Financial Officer services, will, going forward, provide financial consulting services on an "as requested" basis. Thomas Sandgaard, the Company's sole director, will continue to fulfil the role of principal financial officer and chief financial officer. Mr. Sandgaard founded the Company in 1996 after a career in the semiconductor, telecommunications and medical equipment industries with ITT, Siemens and Philips Telecom. Mr. Sandgaard has been the Company's president, CEO and Chairman since 1996 and also currently serves as the Company's sole director. Mr. Sandgaard holds a degree in electronics engineering from University of Southern Denmark, Denmark and an MBA from the Copenhagen Business School. About Zynex Zynex, Inc. (OTCQB: ZYXI) specializes in the production and sale of non-invasive medical devices for pain management, stroke rehabilitation, neurodiagnostic equipment, cardiac and blood volume monitoring. The company maintains its headquarters in Lone Tree, Colorado. Zynex reported a net loss of $2.93 million on $11.64 million of net revenue for the year ended Dec. 31, 2015, compared to a net loss of $6.23 million on $11.11 million of net revenue for the year ended Dec. 31, 2014. As of March 31, 2016, Zynex had $4.19 million in total assets, $8.55 million in total liabilities and a total stockholders' deficit of $4.35 million. GHP Horwath, P.C., in Denver, Colorado, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that the Company incurred significant losses in 2015 and 2014, and has limited liquidity. In addition, the Company is in default of its secured line of credit and as a result, if its lender insists upon immediate repayment, the Company will be insolvent and may be forced to seek protection from its creditors. These factors raise substantial doubt about its ability to continue as a going concern. [*] Energy & Metals Account 48% of Defaults in 2016, Fitch Says --------------------------------------------------------------- The energy and metals/mining sectors still account for 48% ($10.1 billion) of defaults in the U.S. institutional leveraged loan universe this year despite Dex Media Inc. and Fairway Markets filing for bankruptcy in May, according to Fitch Ratings. "While Dex Media's $2.1 billion loan comprised the largest loan default since January 2015, energy and metals/mining still drive the overall volume," said Eric Rosenthal, Senior Director of Leveraged Finance. Metals/mining concern Atlas Iron also defaulted in May due to a distressed debt exchange, continuing a pattern of at least one energy or metals/mining default for the past 13 months. While inching up, leveraged loan defaults remain below the 2.8% long term average. The U.S. leveraged loan market has seen $18.5 billion of defaults on a trailing-12 month (TTM) basis. May's TTM rate rose to 2% from April's 1.8% mark. Low commodity prices will continue to have an impact on secondary market bid levels, even as some borrowers complete restructuring and begin to emerge from bankruptcy with lower leverage. Fitch believes the pre-petition term loan bid price at emergence for companies will remain well below the total term loan market average. The TTM bid price for the few companies emerging from bankruptcy was just 29% -- well below the 72% historic average. Commodity price-related stress coupled with strong refinancing activities over the past few years has reined in new institutional loan issuance, which is down 17% in the first four months of 2016 relative to the year prior. However, activity has picked up recently, with more than $20 billion of new issuance expected shortly. [^] BOND PRICING: For the Week from May 23 to 27, 2016 ------------------------------------------------------ Company Ticker Coupon Bid Price Maturity ------- ------ ------ --------- -------- A. M. Castle & Co CAS 7 46.25 12/15/2017 A. M. Castle & Co CAS 12.75 91.999 12/15/2016 ACE Cash Express Inc AACE 11 48.5 2/1/2019 ACE Cash Express Inc AACE 11 48.5 2/1/2019 Affinion Group Inc AFFINI 7.875 51 12/15/2018 Affinion Investments LLC AFFINI 13.5 43.125 8/15/2018 Alpha Appalachia Holdings Inc ANR 3.25 1 8/1/2015 Alpha Natural Resources Inc ANR 6 0.617 6/1/2019 Alpha Natural Resources Inc ANR 9.75 0.615 4/15/2018 Alpha Natural Resources Inc ANR 6.25 0.877 6/1/2021 Alpha Natural Resources Inc ANR 7.5 1.938 8/1/2020 Alpha Natural Resources Inc ANR 4.875 0.75 12/15/2020 Alpha Natural Resources Inc ANR 3.75 0.75 12/15/2017 Alpha Natural Resources Inc ANR 7.5 1.938 8/1/2020 Alpha Natural Resources Inc ANR 7.5 1.908 8/1/2020 American Eagle Energy Corp AMZG 11 12 9/1/2019 American Eagle Energy Corp AMZG 11 12.5 9/1/2019 American Gilsonite Co AMEGIL 11.5 57 9/1/2017 American Gilsonite Co AMEGIL 11.5 56.5 9/1/2017 Arch Coal Inc ACI 7 1.375 6/15/2019 Arch Coal Inc ACI 7.25 1 6/15/2021 Arch Coal Inc ACI 7.25 1.25 10/1/2020 Arch Coal Inc ACI 9.875 0.938 6/15/2019 Arch Coal Inc ACI 8 1.75 1/15/2019 Arch Coal Inc ACI 8 1.296 1/15/2019 Armstrong Energy Inc ARMS 11.75 43.35 12/15/2019 Armstrong Energy Inc ARMS 11.75 42 12/15/2019 Atlas Energy Holdings Operating Co LLC / Atlas Resource Finance Corp ARP 7.75 13.4 1/15/2021 Atlas Energy Holdings Operating Co LLC / Atlas Resource Finance Corp ARP 9.25 13.472 8/15/2021 Atlas Energy Holdings Operating Co LLC / Atlas Resource Finance Corp ARP 9.25 12.625 8/15/2021 Atlas Energy Holdings Operating Co LLC / Atlas Resource Finance Corp ARP 9.25 12.625 8/15/2021 Avaya Inc AVYA 10.5 28.5 3/1/2021 Avaya Inc AVYA 10.5 27.5 3/1/2021 BPZ Resources Inc BPZR 6.5 2.686 3/1/2015 BPZ Resources Inc BPZR 6.5 2.686 3/1/2049 Basic Energy Services Inc BAS 7.75 35.436 2/15/2019 Berry Petroleum Co LLC LINE 6.75 25.45 11/1/2020 BreitBurn Energy Partners LP / BreitBurn Finance Corp BBEP 7.875 11.5 4/15/2022 BreitBurn Energy Partners LP / BreitBurn Finance Corp BBEP 8.625 13.563 10/15/2020 BreitBurn Energy Partners LP / BreitBurn Finance Corp BBEP 8.625 13.375 10/15/2020 BreitBurn Energy Partners LP / BreitBurn Finance Corp BBEP 8.625 13.375 10/15/2020 Caesars Entertainment Operating Co Inc CZR 10 41 12/15/2018 Caesars Entertainment Operating Co Inc CZR 12.75 42.25 4/15/2018 Caesars Entertainment Operating Co Inc CZR 10 41 12/15/2018 Caesars Entertainment Operating Co Inc CZR 5.75 39.3 10/1/2017 Caesars Entertainment Operating Co Inc CZR 10 41 12/15/2018 Caesars Entertainment Operating Co Inc CZR 5.75 12.25 10/1/2017 Caesars Entertainment Operating Co Inc CZR 10 37.75 12/15/2018 Caesars Entertainment Operating Co Inc CZR 10 41 12/15/2018 Chassix Holdings Inc CHASSX 10 8 12/15/2018 Chassix Holdings Inc CHASSX 10 8 12/15/2018 Claire's Stores Inc CLE 8.875 24.7 3/15/2019 Claire's Stores Inc CLE 10.5 59.837 6/1/2017 Claire's Stores Inc CLE 7.75 20.5 6/1/2020 Claire's Stores Inc CLE 7.75 21.375 6/1/2020 Clean Energy Fuels Corp CLNE 7.5 85.826 8/30/2016 Cliffs Natural Resources Inc CLF 5.95 59.034 1/15/2018 Community Choice Financial Inc CCFI 10.75 46.808 5/1/2019 Comstock Resources Inc CRK 7.75 26.875 4/1/2019 Comstock Resources Inc CRK 9.5 26.25 6/15/2020 Creditcorp CRECOR 12 52 7/15/2018 Creditcorp CRECOR 12 52 7/15/2018 Cumulus Media Holdings Inc CMLS 7.75 43.5 5/1/2019 EPL Oil & Gas Inc EXXI 8.25 8.5 2/15/2018 EXCO Resources Inc XCO 7.5 27 9/15/2018 EXCO Resources Inc XCO 8.5 19.67 4/15/2022 Eagle Rock Energy Partners LP / Eagle Rock Energy Finance Corp EROC 8.375 16.75 6/1/2019 Emerald Oil Inc EOX 2 2 4/1/2019 Endeavour International Corp END 12 1.017 3/1/2018 Endeavour International Corp END 12 1.017 3/1/2018 Energy & Exploration Partners Inc ENEXPR 8 1.97 7/1/2019 Energy & Exploration Partners Inc ENEXPR 8 1.97 7/1/2019 Energy Conversion Devices Inc ENER 3 7.875 6/15/2013 Energy Future Holdings Corp TXU 11.25 50.625 11/1/2017 Energy Future Holdings Corp TXU 9.75 20 10/15/2019 Energy Future Intermediate Holding Co LLC / EFIH Finance Inc TXU 10 1 12/1/2020 Energy Future Intermediate Holding Co LLC / EFIH Finance Inc TXU 10 4 12/1/2020 Energy Future Intermediate Holding Co LLC / EFIH Finance Inc TXU 9.75 20 10/15/2019 Energy Future Intermediate Holding Co LLC / EFIH Finance Inc TXU 6.875 4 8/15/2017 Energy XXI Gulf Coast Inc EXXI 11 40 3/15/2020 Energy XXI Gulf Coast Inc EXXI 9.25 4 12/15/2017 Energy XXI Gulf Coast Inc EXXI 7.5 4.75 12/15/2021 Energy XXI Gulf Coast Inc EXXI 6.875 4.875 3/15/2024 Energy XXI Gulf Coast Inc EXXI 7.75 4.5 6/15/2019 FBOP Corp FBOPCP 10 1.843 1/15/2009 FXCM Inc FXCM 2.25 44 6/15/2018 FairPoint Communications Inc/Old FRP 13.125 1.879 4/2/2018 Federal Farm Credit Banks FFCB 2.93 100.311 6/3/2024 Federal Farm Credit Banks FFCB 2.98 99.368 3/2/2027 Fleetwood Enterprises Inc FLTW 14 3.557 12/15/2011 Forbes Energy Services Ltd FES 9 43.5 6/15/2019 Gibson Brands Inc GIBSON 8.875 52.5 8/1/2018 Gibson Brands Inc GIBSON 8.875 48.222 8/1/2018 Gibson Brands Inc GIBSON 8.875 48.5 8/1/2018 Goodman Networks Inc GOODNT 12.125 47.03 7/1/2018 Goodrich Petroleum Corp GDPM 8.875 0.583 3/15/2018 Goodrich Petroleum Corp GDPM 8.875 0.583 3/15/2018 Gymboree Corp/The GYMB 9.125 54.1 12/1/2018 Halcon Resources Corp HKUS 9.75 19.9 7/15/2020 Halcon Resources Corp HKUS 8.875 20 5/15/2021 Halcon Resources Corp HKUS 9.25 19.625 2/15/2022 Hanesbrands Inc HBI 6.375 103.375 12/15/2020 Hexion Inc HXN 9.2 57.79 3/15/2021 Horsehead Holding Corp ZINC 3.8 4 7/1/2017 Horsehead Holding Corp ZINC 10.5 55.5 6/1/2017 Horsehead Holding Corp ZINC 9 20 6/1/2017 Horsehead Holding Corp ZINC 10.5 55.5 6/1/2017 Horsehead Holding Corp ZINC 10.5 55.5 6/1/2017 ION Geophysical Corp IO 8.125 59 5/15/2018 Illinois Power Generating Co DYN 7 38 4/15/2018 Illinois Power Generating Co DYN 6.3 36 4/1/2020 Iracore International Holdings Inc IRACOR 9.5 59.125 6/1/2018 Iracore International Holdings Inc IRACOR 9.5 59.125 6/1/2018 IronGate Energy Services LLC IRONGT 11 25 7/1/2018 IronGate Energy Services LLC IRONGT 11 24.5 7/1/2018 IronGate Energy Services LLC IRONGT 11 24.5 7/1/2018 IronGate Energy Services LLC IRONGT 11 24.5 7/1/2018 Key Energy Services Inc KEG 6.75 28 3/1/2021 Las Vegas Monorail Co LASVMC 5.5 3.569 7/15/2019 Lehman Brothers Holdings Inc LEH 4 3.742 4/30/2009 Lehman Brothers Holdings Inc LEH 2 3.742 3/3/2009 Lehman Brothers Holdings Inc LEH 1.5 3.742 3/29/2013 Lehman Brothers Holdings Inc LEH 2.07 3.742 6/15/2009 Lehman Brothers Holdings Inc LEH 5 3.742 2/7/2009 Lehman Brothers Holdings Inc LEH 1.6 3.742 11/5/2011 Lehman Brothers Inc LEH 7.5 1.226 8/1/2026 Liberty Interactive LLC LINTA 1 86.625 9/30/2043 Linc USA GP / Linc Energy Finance USA Inc LNCAU 9.625 18 10/31/2017 Linn Energy LLC / Linn Energy Finance Corp LINE 8.625 16.813 4/15/2020 Linn Energy LLC / Linn Energy Finance Corp LINE 6.5 14.875 5/15/2019 Linn Energy LLC / Linn Energy Finance Corp LINE 7.75 16.25 2/1/2021 Linn Energy LLC / Linn Energy Finance Corp LINE 12 25.5 12/15/2020 Linn Energy LLC / Linn Energy Finance Corp LINE 6.25 16 11/1/2019 Linn Energy LLC / Linn Energy Finance Corp LINE 6.5 15.375 9/15/2021 Linn Energy LLC / Linn Energy Finance Corp LINE 6.25 15.875 11/1/2019 Linn Energy LLC / Linn Energy Finance Corp LINE 6.25 15.875 11/1/2019 Logan's Roadhouse Inc LGNS 10.75 15.25 10/15/2017 Lonestar Resources America Inc LNRAU 8.75 41.5 4/15/2019 Lonestar Resources America Inc LNRAU 8.75 41 4/15/2019 MF Global Holdings Ltd MF 3.375 23.5 8/1/2018 MF Global Holdings Ltd MF 9 23.5 6/20/2038 MModal Inc MODL 10.75 10.125 8/15/2020 Magnetation LLC / Mag Finance Corp MAGNTN 11 20 5/15/2018 Magnetation LLC / Mag Finance Corp MAGNTN 11 8.875 5/15/2018 Magnetation LLC / Mag Finance Corp MAGNTN 11 8.875 5/15/2018 Midstates Petroleum Co Inc / Midstates Petroleum Co LLC MPO 10.75 0.75 10/1/2020 Midstates Petroleum Co Inc / Midstates Petroleum Co LLC MPO 9.25 0.75 6/1/2021 Midstates Petroleum Co Inc / Midstates Petroleum Co LLC MPO 12 9 6/1/2020 Midstates Petroleum Co Inc / Midstates Petroleum Co LLC MPO 10.75 96.25 10/1/2020 Midstates Petroleum Co Inc / Midstates Petroleum Co LLC MPO 10.75 1.534 10/1/2020 Modular Space Corp MODSPA 10.25 51 1/31/2019 Modular Space Corp MODSPA 10.25 50 1/31/2019 Molycorp Inc MCP 10 3.218 6/1/2020 Murray Energy Corp MURREN 11.25 19.25 4/15/2021 Murray Energy Corp MURREN 9.5 16.375 12/5/2020 Murray Energy Corp MURREN 11.25 19 4/15/2021 Murray Energy Corp MURREN 9.5 16.375 12/5/2020 New Gulf Resources LLC/ NGR Finance Corp NGREFN 12.25 22 5/15/2019 New Gulf Resources LLC/ NGR Finance Corp NGREFN 12.25 29 5/15/2019 New Gulf Resources LLC/ NGR Finance Corp NGREFN 12.25 22.75 5/15/2019 Nine West Holdings Inc JNY 8.25 28 3/15/2019 Nine West Holdings Inc JNY 6.125 15 11/15/2034 Nine West Holdings Inc JNY 6.875 19.674 3/15/2019 Nine West Holdings Inc JNY 8.25 20.625 3/15/2019 Nuverra Environmental Solutions Inc NESC 9.875 31 4/15/2018 OMX Timber Finance Investments II LLC OMX 5.54 12 1/29/2020 Optima Specialty Steel Inc OPTSTL 12.5 80 12/15/2016 Optima Specialty Steel Inc OPTSTL 12.5 70.5 12/15/2016 Peabody Energy Corp BTU 6 13.002 11/15/2018 Peabody Energy Corp BTU 6.5 12.98 9/15/2020 Peabody Energy Corp BTU 6.25 14.37 11/15/2021 Peabody Energy Corp BTU 10 14.5 3/15/2022 Peabody Energy Corp BTU 7.875 14 11/1/2026 Peabody Energy Corp BTU 10 11.875 3/15/2022 Peabody Energy Corp BTU 6 12.375 11/15/2018 Peabody Energy Corp BTU 6 17.25 11/15/2018 Peabody Energy Corp BTU 6.25 12.75 11/15/2021 Peabody Energy Corp BTU 6.25 12.75 11/15/2021 Penn Virginia Corp PVAH 7.25 27.87 4/15/2019 Penn Virginia Corp PVAH 8.5 30.125 5/1/2020 Permian Holdings Inc PRMIAN 10.5 38.625 1/15/2018 Permian Holdings Inc PRMIAN 10.5 38.625 1/15/2018 Pernix Therapeutics Holdings Inc PTX 4.25 19.75 4/1/2021 Pernix Therapeutics Holdings Inc PTX 4.25 18.921 4/1/2021 PetroQuest Energy Inc PQ 10 51 9/1/2017 Prospect Holding Co LLC / Prospect Holding Finance Co PRSPCT 10.25 34.75 10/1/2018 Prospect Holding Co LLC / Prospect Holding Finance Co PRSPCT 10.25 34.75 10/1/2018 Quicksilver Resources Inc KWKA 9.125 0.75 8/15/2019 Quicksilver Resources Inc KWKA 11 2.5 7/1/2021 Rex Energy Corp REXX 8.875 16.108 12/1/2020 Rex Energy Corp REXX 6.25 10 8/1/2022 Rolta LLC RLTAIN 10.75 36 5/16/2018 SFX Entertainment Inc SFXE 9.625 1.5 2/1/2019 SFX Entertainment Inc SFXE 9.625 1.5 2/1/2019 SFX Entertainment Inc SFXE 9.625 1.5 2/1/2019 SFX Entertainment Inc SFXE 9.625 1.5 2/1/2019 Sabine Oil & Gas Corp SOGC 7.25 2.5 6/15/2019 Sabine Oil & Gas Corp SOGC 7.5 2.5 9/15/2020 Sabine Oil & Gas Corp SOGC 7.5 2.531 9/15/2020 Sabine Oil & Gas Corp SOGC 7.5 2.531 9/15/2020 Samson Investment Co SAIVST 9.75 1.71 2/15/2020 SandRidge Energy Inc SD 8.75 6.85 1/15/2020 SandRidge Energy Inc SD 7.5 5.75 3/15/2021 SandRidge Energy Inc SD 8.125 5.75 10/15/2022 SandRidge Energy Inc SD 7.5 6.6 2/15/2023 SandRidge Energy Inc SD 8.125 5.625 10/16/2022 SandRidge Energy Inc SD 7.5 5.625 2/16/2023 SandRidge Energy Inc SD 7.5 5.375 3/15/2021 SandRidge Energy Inc SD 7.5 5.375 3/15/2021 Sequa Corp SQA 7 26.75 12/15/2017 Sequa Corp SQA 7 26.625 12/15/2017 Sequenom Inc SQNM 5 61.64 10/1/2017 Sequenom Inc SQNM 5 62.75 1/1/2018 Seventy Seven Energy Inc SSEI 6.5 5.75 7/15/2022 Sidewinder Drilling Inc SIDDRI 9.75 6.125 11/15/2019 Sidewinder Drilling Inc SIDDRI 9.75 6 11/15/2019 Speedy Group Holdings Corp SPEEDY 12 45.75 11/15/2017 Speedy Group Holdings Corp SPEEDY 12 45.75 11/15/2017 SquareTwo Financial Corp SQRTW 11.625 11.5 4/1/2017 Stone Energy Corp SGY 7.5 23.75 11/15/2022 Stone Energy Corp SGY 1.75 26 3/1/2017 SunEdison Inc SUNE 2 4.5 10/1/2018 SunEdison Inc SUNE 0.25 6.05 1/15/2020 SunEdison Inc SUNE 5 22 7/2/2018 SunEdison Inc SUNE 2.375 6.063 4/15/2022 SunEdison Inc SUNE 2.75 5.75 1/1/2021 SunEdison Inc SUNE 2.625 5.875 6/1/2023 SunEdison Inc SUNE 3.375 6 6/1/2025 Syniverse Holdings Inc SVR 9.125 49.875 1/15/2019 TMST Inc THMR 8 11.25 5/15/2013 Talos Production LLC / Talos Production Finance Inc TALPRO 9.75 31 2/15/2018 Talos Production LLC / Talos Production Finance Inc TALPRO 9.75 31.25 2/15/2018 TerraVia Holdings Inc TVIA 6 52 2/1/2018 Terrestar Networks Inc TSTR 6.5 10 6/15/2014 TetraLogic Pharmaceuticals Corp TLOG 8 25.143 6/15/2019 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 6.2 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 11.5 32 10/1/2020 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15 6.125 4/1/2021 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 6.25 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15 6.125 4/1/2021 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 11.5 31.75 10/1/2020 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 6.125 11/1/2015 Triangle USA Petroleum Corp TPLM 6.75 22.5 7/15/2022 Triangle USA Petroleum Corp TPLM 6.75 22.25 7/15/2022 UCI International LLC UCII 8.625 28.75 2/15/2019 Vanguard Natural Resources LLC / VNR Finance Corp VNR 7.875 25.3 4/1/2020 Venoco Inc VQ 8.875 3.84 2/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 17.25 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 17.25 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 0.993 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 0.805 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 16.5 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 0.805 1/15/2019 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.75 16.5 1/15/2019 Violin Memory Inc VMEM 4.25 27 10/1/2019 W&T Offshore Inc WTI 8.5 23.5 6/15/2019 Walter Energy Inc WLTG 9.5 13 10/15/2019 Walter Energy Inc WLTG 9.5 19.875 10/15/2019 Walter Energy Inc WLTG 9.5 19.875 10/15/2019 Walter Energy Inc WLTG 9.5 19.875 10/15/2019 Warren Resources Inc WRES 9 2.097 8/1/2022 Warren Resources Inc WRES 9 2.097 8/1/2022 Warren Resources Inc WRES 9 2.097 8/1/2022 Washington Mutual Bank / Debt not acquired by JPMorgan WAMU 6.75 0.25 5/20/2036 iHeartCommunications Inc IHRT 10 55.5 1/15/2018 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. 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The Sunday TCR delivers securitization rating news from the week then-ending. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2016. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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