/raid1/www/Hosts/bankrupt/TCR_Public/070103.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, January 3, 2007, Vol. 11, No. 2
Headlines
ADVANCE AUTO: Moody's Holds Corporate Family Rating at Ba1
ALLIED HOLDINGS: Employs Resource Real to Sell Hapeville Property
ALLIED HOLDINGS: Teamsters Western Withdraws $612,096 Claim
AMTROL INC: Judge Gross Approves All First-Day Motions
APIDOS QUATTRO: Moody's Rates $12 Million Class E Notes at Ba2
ARMSTRONG WORLD: Seven Officers Disclose Common Share Ownership
ARMSTRONG WORLD: Retained Professionals Apply for Final Fees
BANC OF AMERICA: Fitch Rates $3.5 Mil. Class B-5 Certificates at B
BELL MICROPRODUCTS: Obtains Noteholder Waivers on 3-3/4% Notes
CALPINE CORP: Gets Authority to Resolve Income Tax Liabilities
CALPINE CORPORATION: Wants Settlement with Aries Lenders Approved
CAPITAL AUTOMOTIVE: S&P Holds BB+ Ratings with Stable Outlook
CENTRAL VERMONT: Vermont Board Rejects Peterson Dam Removal Pact
CHATTEM INC: Gets $300 Mil. Term Loan from Amended Credit Pact
CITIZENS REPUBLIC: Merger Completion Prompt Fitch to Hold Ratings
COLLINS & AIKMAN: Files Amended Joint Chapter 11 Plan
COLLINS & AIKMAN: Treatment & Classification of Claims Under Plan
COMPUTER SCIENCES: Bondholders Waive Filing Deadline to Jan. 5
COMSTOCK HOMEBUILDING: Settles Default Notice Dispute with BofA
COVALENCE SPECIALTY: Poor Results Prompt S&P's Negative Outlook
CRUSADER INSURANCE: A.M. Best to Lifts Financial Strength Rating
CSFB HOME: S&P Cuts Ratings on Six Classes and Places Neg. Watch
CWALT INC: Fitch Puts Low-B Ratings on $6.8 Million Class Certs.
DATALOGIC INTERNATIONAL: CFO Keith Nguyen Resigns
DELTA AIR: Disclosure Statement Hearing Scheduled on February 7
DELTA MILLS: Court Sets February 1 as General Claims Bar Date
DURA AUTOMOTIVE: Hires Kurtzman Carson as Claims & Notice Agent
DURA AUTOMOTIVE: Wants to Employ Deloitte & Touche as Auditors
DURANGO GEORGIA: Liquidating Trustee Closes Paper Mill Sale
EYI INDUSTRIES: Inks ME2 Marketing Rights Agreement with Mach 3
FEDERAL MOGUL: Court Okays Killian as Special Insurance Counsel
FEDERAL-MOGUL: Wants Court Okay on Lumbermens Settlement Pact
FINANCE AMERICA: S&P Cuts Rating on Class B2 Certs. & Places Watch
FIRST CONSUMER: Fitch Retains Negative Watch on $27.4 Mil. Notes
FLYI INC: Wants Plan Solicitation Period Extended Until April 30
FLYI INC: J. Elassaad Can Liquidate Claims in Penn. District Court
GLOBAL POWER: Wants Until April 26 to Decide on Leases
GOODYEAR TIRE: Inks New Labor Contract with Steelworkers Union
GOODYEAR TIRE: New Labor Contract Cues S&P to Remove Neg. Watch
GREENWICH CAPITAL: Fitch Rates $17.7 Million Class L Certs. at BB+
GSR MORTGAGE: Fitch Rates $1.07 Million Certificates at BB
HOMESTAR MORTGAGE: Moody's Cuts Rating on Class M-5 Certs. to B1
LENOX GROUP: Subsidiary Closes Sale of Pomona Factory to BTR
LEVITZ HOME: NY Court Dismisses Subsidiaries' Chapter 11 Cases
MAC-GRAY CORP: Inks Amended & Restated Credit Pact with Lenders
MELO BIOTECH: Sells Canadian Computer Business to MIAD Information
NEXSTAR BROADCASTING: Completes $56 Mil. Acquisition of WTAJ-TV
OWNIT MORTGAGE: Files for Bankruptcy Protection in California
REFCO INC: Equity Committee Wins $1.2 Million in Court Battle
REFCO INC: Wants PlusFunds' $532 Million Claims Disallowed
REFCO INC: Wants to Assume Iron Mountain Contracts
SEA CONTAINERS: HSH Nordbank Doesn't Object to Aegean Stake Sale
SEA CONTAINERS: Wants to Pay Employees Dismissed During Bankruptcy
SMART MODULAR: Earns $14.6 Million in First Quarter Ended Nov. 30
STRUCTURED ADJUSTABLE: Fitch Rates $1 Million Certificates at BB
STRUCTURED ASSET: Fitch Rates $7 Million Certificates at BB
TABERNA FUNDING II: Fitch Holds BB+ Rating on $42.5 Million Notes
TABERNA FUNDING III: Fitch Holds BB+ Rating on $31.5 Million Notes
TELECONNECT INC: Murrell Hall Express Going Concern Doubt
TXU CORP: Voluntarily Withdraws Securities from NYSE Arca Listing
UAL CORP: Court Okays Agreement Settling Webb Electric's Claim
UAL CORP: Discloses Status of Plan Consummation as of Dec. 2006
UTSTARCOM INC: Seeks Waiver of Default from Holders of 7/8% Notes
VESTA INSURANCE: Court Confirms Third Amended Liquidation Plan
VESTA INSURANCE: Court Confirms Gaines' Third Amended Plan
WINSTAR COMMS: Wants to Reclaim Proceeds of Escrowed Accounts
WOODWIND & BRASSWIND: Court Approves $25 Million LaSalle Financing
* Law Firms Arent Fox and O'Brien Abeles Merges
* S. Wickouski Named One of 2005 Outstanding Restructuring Lawyers
* Upcoming Meetings, Conferences and Seminars
*********
ADVANCE AUTO: Moody's Holds Corporate Family Rating at Ba1
----------------------------------------------------------
Moody's Investors Service downgraded the speculative grade
liquidity rating of Advance Auto Parts, Inc. to SGL-2 from SGL-1,
affirmed its Ba1 corporate family rating, and upgraded its
probability of default rating to Ba1 from Ba2. The outlook on its
long term ratings remains positive.
Rating downgraded:
Advance Auto Parts, Inc.
Speculative grade liquidity rating to SGL-2 from SGL-1
Rating upgraded:
Advance Auto Parts, Inc.
Probability of Default to Ba1
Rating affirmed:
Advance Auto Parts, Inc.
Corporate family rating at Ba1
The downgrade of Advance Auto's speculative grade liquidity rating
to SGL-2 reflects an expectation that the company's sales and
profitability may be more volatile over the next four quarters due
to softer demands as evidenced by more modest growth in same-store
sales of 1.4% for the quarter ended October 7, 2006, as well as
the reduced cushion under covenants, which are now tighter since
the company's implementation of the unsecured bank credit
facility. However, Moody's expects the company to maintain good
liquidity and that its strong internally generated cash flow
should provide the majority of its working capital and capital
expenditures funding needs for the next four quarters. The
upgrade of the probability of default rating to Ba1 follows the
change in capital structure from all bank debt secured by a first
lien on all assets to all bank debt that is unsecured and pari
passu with all other senior unsecured claims. As a result, the
expected recovery rate declines from 65 per cent to 50 per cent
under Moody's loss given default rating methodology, triggering a
one notch upgrade in the probability of default rating to Ba1
while the corporate family rating remains the same at Ba1.
The affirmation of the Ba1 corporate family rating recognizes that
Advance Auto has a solid franchise and operating model, the upside
ratings impact of which is tempered by its regional concentration
in the eastern United States. It has done a credible job of
competing effectively by focusing on improving its retail
positioning with fresher stores and superior customer service.
Its commercial business continues to broaden and improve, which
serves to leverage the cost base already in place with its retail
stores. Credit metrics are for the most part low investment grade
according to Moody's Global Retail Rating Methodology, and the
recent closing of an unsecured bank facility is an investment
grade feature. The spread between the Baa3 rating borne out by
the grid and the Ba1 rating reflects Moody's desire to ensure that
the softer operating performance in the second half of 2006 is a
temporary, macroeconomic-fueled phenomenon and not the beginning
of a downward trend. The rating also balances credit metrics that
are basically investment grade, with the exception of free cash
flow to net debt, which scores a B due to the high levels of
capital expenditures necessary to grow and maintain the store
base, against franchise factors that are also mostly investment
grade. Advance has a very strong franchise in the regions of the
US in which it has stores. While the company's profitability is
lower than one of its larger competitors, it is stronger than some
other competitors in its space. The rating also reflects the very
low seasonality of auto parts retailing and the steady,
predictable demand for its products.
The positive outlook recognizes that continued improvement in
operating performance has resulted in several investment grade
characteristics as evidenced by the rating grid.
There is presently upward rating pressure due to the solid
operating performance, although the pace of any upgrade has been
delayed somewhat by currently soft operating performance. An
upgrade is likely once operating performance begins to improve and
if retained cash flow to net debt approaches 25%. In the event
operating performance were to soften significantly, a stable
outlook would be the result. Quantitatively, if debt/EBITDA were
to increase above 3.5 times, or if free cash flow to net debt
turns and remains negative, or if retained cash flow to net debt
is sustained below 20%, the likely result would be a stable
outlook
Advance Auto Parts, Inc is headquartered in Roanoke, Virginia, and
is the parent company of Advance Stores Company, Inc., which
operates the second largest U.S. auto parts retail chain with
3,029 stores at October 7, 2006 and 2005 annual revenues of
roughly $4.3 billion.
ALLIED HOLDINGS: Employs Resource Real to Sell Hapeville Property
-----------------------------------------------------------------
Allied Holdings, Inc., and its debtor-affiliates obtained
authority from the Honorable Ray Mullins of the U.S. Bankruptcy
Court for the Northern District of Georgia to employ Resource Real
Estate Partners, LLC, as the exclusive broker for 43.75 acres of
real property owned by Allied Systems, Ltd. (L.P.) in accordance
with a brokerage agreement between Allied Holdings, Inc., and
Resource Real Estate, nunc pro tunc to Nov. 13, 2006.
As reported in the Troubled Company Reporter on Dec. 5, 2006, the
Agreement, effective through March 1, 2007, grants Resource Real
Estate exclusive authority to market and solicit bids for the
property commonly known as 25 Southside Industrial Parkway in the
city of Hapeville, Georgia. Resource Real Estate will be paid a
commission equal to 6% of the Property's sale price.
A full-text copy of the Agreement is available for free at:
http://researcharchives.com/t/s?164b
Resource Real Estate has not received a retainer or any payments
from the Debtors during the 90 days immediately preceding the
Petition Date.
Scott McGregor, an associate broker at Resource Real Estate,
assures the Court that his firm is a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code.
About Allied Holdings
Based in Decatur, Georgia, Allied Holdings Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 36;
Bankruptcy Creditors' Service, Inc. http://bankrupt.com/newsstand/
or 215/945-7000)
ALLIED HOLDINGS: Teamsters Western Withdraws $612,096 Claim
-----------------------------------------------------------
The Western Conference of Teamsters Pension Trust Fund, a creditor
of Allied Holdings, Inc., informs the Honorable Ray Mullins of the
U.S. Bankruptcy Court for the Northern District of Georgia that it
has withdrawn its Claim No. 2, which asserts $612,096 against the
Debtors' estates.
Based in Decatur, Georgia, Allied Holdings Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 36;
Bankruptcy Creditors' Service, Inc. http://bankrupt.com/newsstand/
or 215/945-7000)
AMTROL INC: Judge Gross Approves All First-Day Motions
------------------------------------------------------
The Honorable Kevin Gross of the U.S. Bankruptcy Court for the
District of Delaware approved all of the "first-day motions" that
AMTROL Inc. and several of its affiliated companies submitted as
part of their filings for reorganization under Chapter 11 of the
U.S. Bankruptcy Code. Approval of these motions will enable
AMTROL to operate in the normal course of business during the
reorganization process.
The Judge's orders include approval of AMTROL's request to
continue payment of wages and benefits to employees and
independent sales representatives, sales rebates and warranty
claims and to take a variety of other actions necessary to operate
the Company with minimal disruption.
DIP Financing Access Approval
AMTROL also received interim approval to access and subsequently
closed a $115 million debtor-in-possession financing facility
provided by Barclay's Capital. This financing will provide AMTROL
with additional liquidity to satisfy obligations associated with
conducting the Company's business, including payments to suppliers
under normal terms for goods and services provided after the
Chapter 11 filing. AMTROL will seek final approval to fully
utilize the DIP facility in January.
Noteholders representing more than two-thirds of the $97.8 million
of the company's Senior Subordinated Notes outstanding have agreed
in principle to convert their Notes to equity as part of a
financial restructuring. The restructuring anticipates that all
suppliers will be paid in full for goods and services provided
before the filing.
"Judge Gross's approval of our first-day motions ensures that
AMTROL will maintain normal operations throughout the
reorganization process," Larry T. Guillemette, AMTROL's Chairman,
President and Chief Executive Officer, said. "Employee wages and
benefits will be paid without interruption, customer orders will
be filled in the normal course and payments will be made to
suppliers for goods and services provided after the filing. We
look forward to completing the previously announced financial
restructuring that will substantially reduce the company's debt
and greatly improve its long-term financial stability."
About Amtrol Inc.
Headquartered in West Warwick, Rhode Island, Amtrol Inc. --
http://www.amtrol.com/-- manufactures and markets water storage
and pressure control products, water heaters and cylinders. The
company's major products include pressure tanks used in well
water, hydronic heating and potable hot water applications,
indirect-fired water heaters, and both LPG and disposable
refrigerant gas cylinders.
The company and three of its affiliates filed for chapter 11
protection on Dec. 18, 2006 (Bankr. D. Del. Lead Case No.
06-11446). Mark Daniel Olivere, Esq., Stuart J. Brown, Esq., and
William E. Chipman Jr., Esq., at Edwards Angell Palmer & Dodge
LLP, represent the Debtors. As of Apr. 1, 2006, the Debtors'
consolidated financial condition showed $229,270,000 in total
assets and $235,802,000 in total debts.
APIDOS QUATTRO: Moody's Rates $12 Million Class E Notes at Ba2
--------------------------------------------------------------
Moody's Investors Service has assigned these ratings to Notes
issued by Apidos Quattro CDO:
(1) Aaa to $262,000,000 Class A Senior Notes Due 2019;
(2) Aa2 to $21,000,000 Class B Senior Notes Due 2019;
(3) A2 to $16,000,000 Class C Deferrable Mezzanine Notes Due
2019;
(4) Baa2 to $14,000,000 Class D Deferrable Mezzanine Notes Due
2019 and
(5) Ba2 to $12,000,000 Class E Deferrable Junior Notes Due
2019.
The Moody's ratings of the Notes address the ultimate cash receipt
of all required interest and principal payments, as provided by
the Notes' governing documents, and are based on the expected loss
posed to Noteholders, relative to the promise of receiving the
present value of such payments.
The ratings reflect the risks due to the diminishment of cash flow
from the underlying portfolio consisting primarily of Senior
Secured Loans due to defaults, the transaction's legal structure
and the characteristics of the underlying assets.
Apidos Collateral Management, LLC will manage the selection,
acquisition and disposition of collateral on behalf of the Issuer.
ARMSTRONG WORLD: Seven Officers Disclose Common Share Ownership
---------------------------------------------------------------
Seven officers of Armstrong World Industries, Inc., disclosed in
separate filings with the Securities and Exchange Commission their
ownership of restricted shares of AWI common stock as of
Oct. 31, 2006.
The Officers, who also own stock options to buy more AWI shares at
an exercise price of $38.42 a share, are:
Restricted Stock
Officer Designation Shares Options
------- ----------- ---------- -------
Nicholas F. VP & CFO 41,400 124,200
Grasberger
III, Sr.
Michael D. Board Chairman, 225,000
Lockhart President & CEO
Donald A. VP - Human 27,600 82,800
McCunniff, Sr. Resources
Frank J. Ready President & CEO, 27,600 82,800
North America
John N. Rigas, Sr. VP, Secretary & 27,600 82,800
General Counsel
William C. VP & Controller 10,000 30,000
Rodruan
Stephen J. Exec. VP, Pres., 55,200 165,600
Senkowski & CEO ABP
The Restricted Shares vest in three equal installments at two,
three and four years from Oct. 2, 2006, contingent upon an
officer's employment on the scheduled vesting date. The Stock
Options become exercisable in one-thirds on Oct. 2, 2008,
Oct. 2, 2009, and Oct. 2, 2010.
No shares of stock may be acquired by exercise of an option after
a maximum of 10 years from the date the option was granted, except
as provided in the case of an optionee's death.
Based in Lancaster, Pennsylvania, Armstrong World Industries, Inc.
-- http://www.armstrong.com/-- the major operating subsidiary of
Armstrong Holdings, Inc., designs, manufactures and sells interior
floor coverings and ceiling systems, around the world.
The company and its affiliates filed for chapter 11 protection on
December 6, 2000 (Bankr. Del. Case No. 00-04469). StephenKarotkin,
Esq., at Weil, Gotshal & Manges LLP, and Russell C.Silberglied,
Esq., at Richards, Layton & Finger, P.A., represent the Debtors in
their restructuring efforts. The company and its affiliates
tapped the Feinberg Group for analysis, evaluation, and treatment
of personal injury asbestos claims.
Mark Felger, Esq. and David Carickhoff, Esq., at Cozen and
O'Connor, and Robert Drain, Esq., Andrew Rosenberg, Esq., and
Alexander Rohan, Esq., at Paul, Weiss, Rifkind, Wharton &
Garrison, represent the Official Committee of Unsecured Creditors.
The Creditors Committee tapped Houlihan Lokey for financial and
investment advice. The Official Committee of Asbestos Personal
Injury Claimant hired Ashby & Geddes as counsel.
The Bankruptcy Court confirmed AWI's plan on Nov. 18, 2003. The
District Court Judge Robreno confirmed AWI's Modified Plan on
Aug. 14, 2006. The Clerk entered the formal written confirmation
order on Aug. 18, 2006. The company's "Fourth Amended Plan of
Reorganization, as Modified," has become effective and AWI has
emerged from Chapter 11.
* * *
As reported in the Troubled Company Reporter on Oct. 9, 2006,
Standard & Poor's Ratings Services raised its corporate credit
rating on Armstrong World Industries Inc. to 'BB' from 'D',
following the Company's emergence from bankruptcy on Oct. 2, 2006.
The outlook is stable.
ARMSTRONG WORLD: Retained Professionals Apply for Final Fees
------------------------------------------------------------
Bankruptcy professionals employed in Armstrong World Industries,
Inc. and its debtor affiliates' cases separately filed with the
U.S. Bankruptcy Court for the District of Delaware their final
applications seeking payment of fees and reimbursement of expenses
pursuant to Section 330 and 331 of the Bankruptcy Code.
The Debtors' professionals are:
Professional Fee Period Fees Expenses
------------ ---------- ---- --------
American Appraisal 10/31/02 - 10/02/06 $1,095,624 $93,699
Associates, Inc.
Buchanan Ingersoll 12/06/00 - 03/31/02 417,900 10,839
& Rooney PC
Covington & Burling 12/06/00 - 10/02/06 2,772,900 523,571
LLP
Deloitte & Touche 08/30/01 - 10/02/06 10,721,520 1,165,841
LLP
Dickstein Shapiro 12/01/00 - 10/02/06 876,012 28,514
LLP
Dr. Frederick C. 06/05/01 - 07/25/05 946,029 9,653
Dunbar
Gibbons, Del Deo, 12/20/01 - 10/02/06 697,878 24,037
Dolan, Griffinger
& Vecchione
Gilbert Hientz & 01/01/01 - 10/02/06 1,740,198 112,455
Randolph
KPMG LLP 12/06/00 - 10/02/06 23,664,002 1,025,013
Lazard Freres & 12/06/00 - 10/02/06 13,967,742 90,712
Co. LLC
Miles & 02/06/01 - 10/02/06 150,767 21,624
Stockbridge P.C.
Morgan, Lewis & 02/14/03 - 10/02/06 254,574 14,268
Bockius
Peterson Consulting 12/06/00 - 10/02/06 513,570 14,920
Reed Smith LLP 12/06/00 - 10/02/06 332,676 8,082
Richards, Layton & 12/06/00 - 10/02/06 1,294,195 1,192,340
Finger, P.A.
Spriggs & 03/01/01 - 04/30/06 2,398,259 176,146
Hollingsworth
The Feinberg 12/06/00 - 10/02/06 2,212,992 214,285
Group, LLP
Weil, Gotshal & 12/06/00 - 10/02/06 23,254,177 927,382
Manges
Womble Carlyle 12/06/00 - 10/02/06 11,228,611 2,757,239
Sandridge & Rice,
PLLC
Hewitt Associates LLC, an ordinary course professional, served as
actuarial consultant for the Debtors. Hewitt Associates ask the
Court for payment of $570,878 from the Debtors for outstanding OCP
fees and expenses.
Professionals retained by the Official Committee of Unsecured
Creditors are:
Professional Fee Period Fees Expenses
------------ ---------- ---- --------
Cozen O'Connor 12/29/00 - 10/02/06 $247,744 $69,499
Houlihan Lokey Howard & 01/04/01 - 08/15/06 8,772,581 109,972
Zukin Capital
Paul, Weiss, Rifkind, 12/15/00 - 10/02/06 4,500,849 555,828
Wharton & Garrison LLP
Professionals retained by the Official Committee of Asbestos
Personal Injury Claimants are:
Professional Fee Period Fees Expenses
------------ ---------- ---- --------
Campbell & Levine, LLC 06/16/01 - 10/02/06 $717,915 $74,989
Caplin & Drysdale, 12/15/00 - 10/02/06 2,351,929 168,951
Chartered
L. Tersigni Consulting 02/01/01 - 10/02/06 3,560,168 19,509
P.C.
Legal Analysis Systems, 01/01/01 - 10/02/06 824,775 26,454
Inc.
The PI Committee also seeks reimbursement of $50,933 in expenses
since its appointment in December 2000.
Professionals retained by Dean M. Trafelet, as legal
representative for future claimants, are:
Professional Fee Period Fees Expenses
------------ ---------- ---- --------
Analysis, Research & 01/23/02 - 10/31/06 952,803 21,888
Planning Corp.
Kaye Scholer LLP 12/20/01 - 11/13/06 3,784,104 176,259
Peter J. Solomon Co. 09/01/06 - 10/31/06 5,039,288 26,072
Young Conaway Stargatt & 12/20/01 - 10/31/06 516,372 101,125
Taylor, LLP
The Futures Representative also seeks payment of $1,282,230 for
its legal services and $72,071 as reimbursement of its expenses
since its appointment in 2002.
Based in Lancaster, Pennsylvania, Armstrong World Industries, Inc.
-- http://www.armstrong.com/-- the major operating subsidiary of
Armstrong Holdings, Inc., designs, manufactures and sells interior
floor coverings and ceiling systems, around the world.
The company and its affiliates filed for chapter 11 protection on
December 6, 2000 (Bankr. Del. Case No. 00-04469). StephenKarotkin,
Esq., at Weil, Gotshal & Manges LLP, and Russell C.Silberglied,
Esq., at Richards, Layton & Finger, P.A., represent the Debtors in
their restructuring efforts. The company and its affiliates
tapped the Feinberg Group for analysis, evaluation, and treatment
of personal injury asbestos claims.
Mark Felger, Esq. and David Carickhoff, Esq., at Cozen and
O'Connor, and Robert Drain, Esq., Andrew Rosenberg, Esq., and
Alexander Rohan, Esq., at Paul, Weiss, Rifkind, Wharton &
Garrison, represent the Official Committee of Unsecured Creditors.
The Creditors Committee tapped Houlihan Lokey for financial and
investment advice. The Official Committee of Asbestos Personal
Injury Claimant hired Ashby & Geddes as counsel.
The Bankruptcy Court confirmed AWI's plan on Nov. 18, 2003. The
District Court Judge Robreno confirmed AWI's Modified Plan on
Aug. 14, 2006. The Clerk entered the formal written confirmation
order on Aug. 18, 2006. The company's "Fourth Amended Plan of
Reorganization, as Modified," has become effective and AWI has
emerged from Chapter 11.
* * *
As reported in the Troubled Company Reporter on Oct. 9, 2006,
Standard & Poor's Ratings Services raised its corporate credit
rating on Armstrong World Industries Inc. to 'BB' from 'D',
following the Company's emergence from bankruptcy on Oct. 2, 2006.
The outlook is stable.
BANC OF AMERICA: Fitch Rates $3.5 Mil. Class B-5 Certificates at B
------------------------------------------------------------------
Fitch rates Banc of America Funding Corporation's mortgage pass-
through certificates, series 2006-J, as:
-- $1,106,591,100 classes 1-A-1, 1-A-R, 2-A-1 through 2-A-8,
3-A-1, 3-A-2, 4-A-1 through 4-A-8, and 5-A-1 through 5-A-3
(senior certificates) 'AAA';
-- $30,952,000 class B-1 'AA';
-- $9,927,000 class B-2 'A';
-- $8,759,000 class B-3 'BBB';
-- $4,672,000 class B-4 'BB'; and
-- $3,504,000 class B-5 'B'.
The 'AAA' rating on the senior certificates reflects the 5.25%
subordination provided by the 2.65% class B-1, the 0.85% class B-
2, the 0.75% class B-3, the 0.40% privately offered class B-4, the
0.30% privately offered class B-5, and the 0.30% privately offered
class B-6. The ratings on class B-1 through B-5 certificates
reflect each certificate's respective level of subordination.
Class B-6 is not rated by Fitch.
The ratings also reflect the quality of the underlying mortgage
collateral, the master servicing capabilities of Wells Fargo Bank,
N.A. (rated 'RMS1' by Fitch) and Fitch's confidence in the
integrity of the legal and financial structure of the transaction.
The transaction consists of five groups of adjustable interest
rate, fully amortizing mortgage loans, secured by first liens on
one- to four-family properties, with a total of 1,592 loans and an
aggregate principal balance of $1,167,908,854 as of December 1,
2006 (the cut-off date). The five loan groups are cross-
collateralized.
The collateral consists of 3/1 (Group 1), 5/1 (Groups 2 and 3),
7/1 (Group 4) and 10/1 (Group 5) hybrid adjustable-rate mortgage
(ARM) loans. After the initial fixed interest rate period of
three, five, seven, and ten years respectively, the interest rate
will adjust annually based on the sum of either (i) the one-year
LIBOR index or (ii) the one-year CMT index and a gross margin
specified in the applicable mortgage note. Approximately 93.12%
of all the loans require interest-only payments until the month
following the first adjustment date. As of the cut-off date, the
mortgage pool has an aggregate principal balance of approximately
$1,167,908,854 and an average balance of $733,611. The weighted
average original loan-to-value ratio for the mortgage loans is
approximately 71.31%. The weighted average remaining term to
maturity is 359 months and the weighted average FICO credit score
for the group is 716. Second homes and investor-occupied
properties constitute 7.17% and 3.56% of the loans, respectively.
Rate/term and cash out refinances account for 31.96% and 32.60% of
the loans, respectively. The states that represent the largest
geographic concentration of mortgaged properties are California
(60.08%), and Florida (5.34%). All other states represent less
than 5% of the outstanding balance of the loans.
None of the mortgage loans are 'high cost' loans as defined under
any local, state, or federal laws.
BAFC, a special purpose corporation, deposited the loans in the
trust, which issued the certificates, representing undivided
beneficial ownership in the trust. Wells Fargo Bank, N.A. will
serve as master servicer and securities administrator. U.S. Bank
National Association will serve as trustee. Elections will be
made to treat the trust as multiple separate real estate mortgage
investment conduits for federal income tax purposes.
BELL MICROPRODUCTS: Obtains Noteholder Waivers on 3-3/4% Notes
--------------------------------------------------------------
Bell Microproducts Inc. disclosed the results of its
consent solicitation relating to its $109,850,000 outstanding
3-3/4% Convertible Subordinated Notes, Series B due 2024. Holders
of $109,475,000 aggregate principal amount of the outstanding
Notes have consented to a waiver of defaults arising from the
failure to file all reports and other information and documents
which it is required to file with the SEC and the trustee.
Further, these holders have agreed to amend the indenture to
eliminate any provision that would trigger a default for the
failure to file or deliver any reports required to be filed with
the SEC or the trustee, and to add a provision for a special
interest payment to holders of Notes if an eligible tender offer
for the outstanding Notes is not completed prior to Feb. 1, 2007.
As reported in the Troubled Company Reporter on Dec. 18, 2006, the
company commenced a tender offer for the Notes that is intended to
qualify as an eligible tender offer under the amended indenture.
Credit Suisse is acting as the Dealer Manager for the tender offer
for the Notes.
As previously reported in the Troubled Company Reporter, the
company said that on Nov. 14, 2006, it received Notices of Default
from Wells Fargo Bank, N.A., with respect to its 3-3/4%
Convertible Subordinated Notes due 2024 and its 3-3/4% Convertible
Subordinated Notes, Series B due 2024. Wells Fargo serves as the
trustee for the holders of the Notes.
Questions regarding the tender offer may be directed to Credit
Suisse at 800-820-1653 (toll-free) or at 212-538-0013. Global
Bondholder Services Corporation will act as the Information Agent
for the tender offer for Notes. Requests for documents related to
the tender offers may be directed to Global Bondholder Services
Corporation at 866-924-2200 (toll-free) or at 212-430-3774.
About Bell Microproducts
Headquartered in San Jose, California, Bell Microproducts Inc.
(Nasdaq: BELM) -- http://www.bellmicro.com/-- is an
international, value-added distributor of high-tech products,
solutions and services, including storage systems, servers,
software, computer components and peripherals, as well as
maintenance and professional services. Bell is a Fortune 1000
company that has operations in Argentina, Brazil, Chile and
Mexico.
CALPINE CORP: Gets Authority to Resolve Income Tax Liabilities
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Calpine Corporation and its debtor-affiliates authority to:
(a) resolve their federal income tax liabilities for the
taxable years 1997-2002 in the amounts shown on the August
RAR; and
(b) perform all other acts that are necessary to implement the
Examination Resolution, including, without limitation,
allowing Claim No. 2869 for $26,559,858, plus interest
accrued through December 20, 2005, on account of their
federal income tax for the taxable years 1997-2002.
The Hon. Burton R. Lifland rules that resolution of the Debtors'
federal income tax liabilities for the taxable years 1997 to 2002
must be reviewed pursuant to 26 U.S.C. Section 6405(b) by the
Joint Committee on Taxation.
If the Joint Committee objects to the Resolution, the Court Order
will be of no effect, the Internal Revenue Service Proof of Claim
will remain for $301,847,326, and the Debtors and the IRS will
retain all their rights to object to or defend Claim No. 2869.
The Debtors file consolidated federal income tax return with most
of their domestic subsidiaries. Since 2002, the Internal Revenue
Service has been engaged in an examination of the Debtors'
federal income tax returns for the taxable years 1997 to 2002.
The Examination has lasted more than four years and has included
over 189 information/document requests from the IRS, two net
operating loss carryback claims, five informal claims for refund
and a carryback of NOLs from 2003 to 2001 made by the Debtors.
The major issues in the Examination related to:
-- the Debtors' energy trading activities,
-- research and development cost deductions,
-- depreciation claimed on certain of the Debtors' assets, and
-- the deduction of certain types of expenses claimed by the
Debtors.
In December 2005, the IRS prepared an "Income Examination
Changes" draft for the Debtors proposing adjustments to income of
$587,263,927. According to David R. Seligman, Esq., at Kirkland
& Ellis LLP, in New York, the adjustments shown on the December
RAR could translate into a tax liability of more than
$100,000,000, plus interest, which may be entitled to priority
treatment under Section 507(a)(8)(A)(iii) of the Bankruptcy Code.
Accordingly, the IRS filed Claim No. 2869 against the Debtors
asserting $301,555,163 for taxes covering the taxable years 1997
to 2004, and an unsecured claim for $292,163 on account of
penalties related to the taxes covering the taxable years 1997 to
2004.
Since the receipt of the December RAR, the Debtors have worked
with the IRS to discuss and determine their proper tax liability
for the taxable years in question, taking into account all
available claims for carryback and refund available to them for
those periods. In August 2006, the IRS sent a revised "Income
Tax Examination Changes" Form, showing net adjustments to income
of $241,826,393. The resulting net tax due from the Debtors is
$26,559,858, composed of approximately $12,800,000 of alternative
minimum tax and $13,800,000 of regular income tax and may be
entitled to priority treatment under Section 507(a)(8)(A)(iii).
Mr. Seligman says the August 2006 Liability is a result of:
* settlement initiatives commenced by the IRS after the date
relevant returns were filed with respect to the treatment of
indirect costs and commissioning costs related to the
building of power plants;
* bonus depreciation taken on turbine assets that were not
eligible for the benefit of bonus depreciation; and
* the disallowance of certain research and development cost
deductions.
The Examination Resolution is memorialized in a series of IRS
Forms 870, which confirm the adjustments shown on the August RAR.
The IRS Forms 870 constitute a waiver of the Debtors' ability to
contest the Examination Resolution in United States Tax Court
unless the IRS assesses additional deficiencies for the taxable
years in question. The IRS Forms 870, however, do not preclude
the Debtors from filing for a refund for the years in question
after it pays the tax, should they later determine that they are
so eligible. As required by law, the Examination Resolution is
subject to approval of the Joint Committee on Taxation.
Mr. Seligman says the Examination Resolution resolves United
States federal income tax exposure with respect to the taxable
years 1997-2002. However, the terms of the Examination
Resolution do not require immediate payment by the Debtors.
Instead, payment will be made pursuant to the terms of a plan of
reorganization confirmed in the Debtors' cases and after they
emerge from Chapter 11.
The Debtors tell the Court that the $26,559,858 tax amount due as
a result of the Examination Resolution, plus accrued interest of
approximately $6,400,000, is significant.
However, Mr. Seligman contends, the Examination has been
continuing for more than four years, and the Debtors have been
negotiating the terms of the Examination Resolution with the IRS
since December 2005. There are hazards of an appeal and
litigation and, therefore, a more favorable outcome in those
instances cannot be assured. In addition, if the Debtors do not
accept the Examination Resolution, they will likely incur
substantial legal fees and expenses litigating the case to final
judgment. Thus, Mr. Seligman asserts, it is in the best
interests of the Debtors' estates to accept the Examination
Resolution to avoid a lengthy and costly litigation where the
outcome is uncertain.
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies
customers and communities with electricity from clean, efficient,
natural gas-fired and geothermal power plants. Calpine owns,
leases and operates integrated systems of plants in 21 U.S. states
and in three Canadian provinces. Its customized products and
services include wholesale and retail electricity, gas turbine
components and services, energy management and a wide range of
power plant engineering, construction and maintenance and
operational services.
The company previously produced a portion of its fuel consumption
requirements from its own natural gas reserves. However, in July
2005, the company sold substantially all of its remaining domestic
oil and gas assets to Rosetta Resources Inc.
The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts. Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors. As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. The Debtors' exclusive period to submit a chapter 11
reorganization plan expires on June 20, 2007. The Debtors'
exclusive period to solicit acceptance of that expires on Aug. 20,
2007. (Calpine Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
CALPINE CORPORATION: Wants Settlement with Aries Lenders Approved
-----------------------------------------------------------------
Calpine Corporation and its debtor-affiliates ask the United
States Bankruptcy Court for the Southern District of New York to
approve their Settlement Agreement with the Aries Lenders.
The 600-megawatt natural gas-fired, combined cycle, generating
facility known as the Aries Project, owned by Debtor MEP Pleasant
Hill, LLC, was listed as one of the Debtors' underperforming
projects.
MEP Pleasant Hill generates revenue by selling electric
generating capacity to Calpine Energy Services, LP, pursuant to a
tolling agreement. In June 2006, CES ceased making payments to
MEP Pleasant Hill under the Tolling Agreement.
Certain Lenders under an Amended and Restated Loan Agreement,
dated March 26, 2004, assert that they are entitled to foreclose
on their collateral, which includes equity interests in MEP
Pleasant Hill held by Debtor CPN Pleasant Hill, LLC. The Aries
Lenders also assert that MEP Pleasant Hill has claims against:
-- CES for repudiation of the Tolling Agreement; and
-- Calpine Corp. for guaranty of CES' obligations under the
Tolling Agreement.
The Aries Lenders calculate that as of December 1, 2006, the
total amount of their claims against MEP Pleasant Hill is
$198,494,280. The Aries Lenders assert that they are entitled to
a first priority lien in substantially all of MEP Pleasant Hill's
assets, including, without limitation, the Aries Facility and the
Tolling Claims, as well as a pledge by CPNPH of its equity
interests in MEP Pleasant Hill.
Calpine Corp. asserts that as of December 1, 2006, the Aries
Lenders' total outstanding secured claim against MEP Pleasant
Hill is $189,840,917.
The primary reason for the difference between the Debtors' and
the Aries Lenders' calculation of the amount of the Lenders Claim
is their calculation of the make-whole premium owed to the
Tranche B Lenders under the Credit Agreement.
Subsequently, the Debtors; DZ AG, Deutsche Zentral-
Genossenschaftsbank, Frankfurt am Main, New York Branch, as
Administration Agent; Union Bank of California, N.A.; the Aries
Lenders; and Calyon New York Branch, agreed to enter into a
settlement agreement to resolve their dispute.
The salient terms of the Settlement Agreement are:
(a) The Aries Lenders will have an allowed secured claim
against MEP Pleasant Hill equal to the sum of:
-- $190,933,221;
-- interest on outstanding principal for the Tranche A
Term Lenders at the Base Rate, plus the Applicable
Margin of 1.125% plus 2% default rate;
-- interest on outstanding principal for the Tranche B
Term Lenders at the Tranche B Term Loan Rate, plus
2% default rate;
-- interest on the make-whole premium at the Tranche B
Term Loan Rate of 10.32% plus 2% default rate;
-- interest on the Swaps, providers of interest rate
hedging protection, at cost plus 1%;
-- all reasonable fees, costs and expenses; and
-- $300,000 Post-Closing Fee.
(b) The Net Sale Proceeds and Cash of the Aries Project and
Cash will be applied against the Aries Secured Claim,
provided that if the Net Sale Proceeds and Cash exceeds
the amount of the Aries Secured Claim, the excess will be
retained by the Debtors;
(c) The Allowed Aries Secured Claim will not be subject to
subordination, avoidance set-off, recoupment, counterclaim
or reduction;
(d) Upon Closing of the Aries Project Sale, the Debtors' right
to use the Aries Lenders' cash collateral will
automatically terminate, provided that the Agreement does
not impair the Debtors' right to use the O&M Reserve or
their continued use of any cash after the payment in full
of the Allowed Aries Secured Claim;
(e) The Debtors and the Agent will calculate the Aries
Lenders' deficiency claim;
(f) MEP Pleasant Hill will be granted an allowed unsecured
claim against Calpine Corp.; and
(g) Upon receipt of the Net Sale Proceeds and Cash and full
payment of the Allowed Deficiency Claim, the parties will
mutually release each other from all claims arising from
the Aries Facility.
A full-text copy of the Aries Lender Settlement Agreement is
available for free at http://ResearchArchives.com/t/s?17d7
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies
customers and communities with electricity from clean, efficient,
natural gas-fired and geothermal power plants. Calpine owns,
leases and operates integrated systems of plants in 21 U.S. states
and in three Canadian provinces. Its customized products and
services include wholesale and retail electricity, gas turbine
components and services, energy management and a wide range of
power plant engineering, construction and maintenance and
operational services.
The company previously produced a portion of its fuel consumption
requirements from its own natural gas reserves. However, in July
2005, the company sold substantially all of its remaining domestic
oil and gas assets to Rosetta Resources Inc.
The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts. Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors. As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. The Debtors' exclusive period to submit a chapter 11
reorganization plan expires on June 20, 2007. The Debtors'
exclusive period to solicit acceptance of that expires on Aug. 20,
2007. (Calpine Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
CAPITAL AUTOMOTIVE: S&P Holds BB+ Ratings with Stable Outlook
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit and 'BB+' senior secured ratings on Capital Automotive LLC
and Capital Automotive L.P.
CARS' $2.2 billion secured credit facility has a recovery rating
of '3', which was also affirmed. The outlook remains stable.
"The ratings on CARS reflect the aggressive financial profile of
this private entity, offset by the stable nature of the company's
good quality portfolio of auto dealership properties located in
growth markets," said Standard & Poor's credit analyst George
Skoufis. The ratings are also supported by the continuity of
management and business strategy following the company's
acquisition by Flag Fund V LLC, a limited liability company
advised by DRA Advisors LLC in a go-private transaction that
closed roughly one year ago.
"Tenant concentration is a credit concern; however, this is
allayed to some degree by brand and revenue diversity as well as
solid tenant lease rent coverage. The capital structure remains
highly leveraged and secured, with debt protection measures that
are considered weak for the rating but have been stable despite
the low margin nature of this competitive and cyclical business,"
Mr. Skoufis said.
The company's long-term leases and good quality portfolio of auto
dealership properties, geographically diversified within growth
markets across the U.S., provide cash flow stability. Debt
protection measures are low but stable; however, CARS' capital
structure remains highly leveraged and secured. Should the
company's already low debt coverage measures become stressed, or
if CARS pursues meaningful investments outside its auto dealer
platform, a negative rating action would be warranted.
Conversely, positive momentum for the ratings is unlikely in the
near term, as S&P does not expect an improvement in debt
protection measures.
CENTRAL VERMONT: Vermont Board Rejects Peterson Dam Removal Pact
----------------------------------------------------------------
The Vermont Public Service Board, citing Act 61, enacted by the
Vermont General Assembly in 2005 and uncertain environmental
benefits, has rejected an agreement among Central Vermont Public
Service, the Vermont Agency of Natural Resources, the Vermont
Department of Public Service, Vermont Natural Resources Council,
Trout Unlimited and the Town of Milton that would have resulted in
the removal of the Peterson Dam located in Milton, Vermont.
CVPS officials have long said they would not have sought the dam's
removal on their own, but reached the settlement to end the years
of litigation at the behest of former Gov. Howard Dean, who
supported the dam's removal. Settlement talks began in earnest in
2000.
"The record indicates that there is no guarantee that removing
Peterson would result in a significant improvement to the Lamoille
fishery," the PSB said in a Dec. 22 decision. "The evidence
presented by both sides was derived primarily from historical
records and extrapolation. Consequently, the extent of the
environmental benefits that would arise from dam removal are
uncertain.
"This absence of clear benefits is in contrast to the known
environmental benefits of a clean, renewable energy source that
has been in place for more than 50 years," the PSB said. "These
benefits of renewable energy have recently been recognized by the
Vermont Legislature."
Act 61, the PSB noted, directs the use renewable energy to meet
incremental electric load growth between Jan. 1, 2005 and
Jan. 1, 2012.
"Recent dockets have illustrated the difficulty of siting
renewable energy projects in Vermont," the order said. "Although
Peterson Dam does not constitute a new renewable generation source
pursuant to the statutory framework, it is a stably-priced,
existing renewable energy source that state policy declares should
be 'retain(ed) and support(ed).'"
The PSB also weighed the cost of dam removal, and concluded there
would be direct customer impacts.
"The State's renewable energy goals must be balanced against the
unknown environmental benefits of removing Peterson, and the
undisputed evidence that removal of the dam will lead to direct
financial impacts on CVPS's ratepayers due to the need to replace
the relatively inexpensive power," the Board wrote. "After
balancing these factors, we cannot find that the benefits of dam
removal are 'clear and compelling' as required by Board
precedent."
Peterson Station is part of a 21-megawatt project consisting of
four dams on the Lamoille River: Fairfax Falls, Clark Falls,
Milton Station, and Peterson Station. The PSB's decision rejects
a relicensing agreement forged after nearly two decades of
litigation. The agreement included utility recovery of costs
associated with the dam's removal and conditions relating to
project operations, fish and wildlife, recreation, land use, and
historic properties. The operating conditions were included in
the FERC license issued and are unaffected by the PSB decision.
"State policy on renewable energy has evolved dramatically over
the past six years," Bob Young, CVPS president, said. "Vermont
now puts great value on these kinds of renewable projects."
A full text-copy of the Vermont Public Service Board order may be
viewed at no charge at http://ResearchArchives.com/t/s?17ef
Founded in 1929, Central Vermont Public Service (NYSE: CV) is
Vermont's largest electric utility. Central Vermont's non-
regulated subsidiary, Eversant Corporation, sells and rents
electric water heaters through a subsidiary, SmartEnergy Water
Heating Services.
* * *
As reported in the Troubled Company reporter on Aug. 4, 2006,
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit rating and 'BBB' senior secured bond rating on electric
utility Central Vermont Public Service Corp. At the same time,
the preferred stock rating was lowered to 'B+' from 'BB-'. The
outlook is stable.
CHATTEM INC: Gets $300 Mil. Term Loan from Amended Credit Pact
--------------------------------------------------------------
Chattem, Inc., as borrower, entered into a Fifth Amendment to
Credit Agreement with Signal Investment & Management Co., Sundex,
LLC and Chattem (Canada) Holdings, Inc., as guarantors, the
persons identified as lenders and Bank of America, N.A., as agent
for the Lenders, pursuant to which, among other things, the
Lenders have agreed to make a $300 million term loan.
The Term Loan is for the financing of part of the acquisition of
the U.S. rights to certain brands currently owned by Johnson &
Johnson and previously owned by the consumer healthcare business
of Pfizer Inc., including ACT(R), Unisom(R), Cortizone,
Kaopectate(R) and Balmex(R).
The Acquisition is expected to close on Jan. 2, 2007. The
Amendment amends in its entirety the Credit Agreement dated as of
Feb. 26, 2004, by and among the company, the Domestic
Subsidiaries, the Lenders and the Agent. The Amendment is
expected to become effective on Jan. 2, 2007 in connection with
the consummation of the Acquisition, which, among other customary
closing conditions, is a condition to the funding of the Term
Loan.
The total amount of the revolving loan commitments under the
Amended Credit Agreement remains unchanged at $100 million. The
Amended Credit Agreement includes an "accordion" feature that
permits the company under certain circumstances to increase the
Revolving Committed Amount by $50 million and, pursuant to the
Amendment, to borrow an additional $50 million as a term loan.
Under the Amended Credit Agreement, borrowings with respect to the
revolving loans bear interest at LIBOR plus applicable percentages
of 1% to 2% or a base rate plus applicable percentages of up to
0.5% and, for the Term Loan, a percentage per annum equal to LIBOR
plus 1.75% for Eurodollar Loans or the base rate plus 0.75% for
Base Rate Loans.
Under the terms of the Amended Credit Agreement, the company is
required to make equal quarterly installments of $750,000 toward
repayment of the principal amount of the Term Loan beginning on
June 30, 2007 and terminating on January 2, 2013, at which time
the outstanding principal balance will be due in full. The entire
outstanding principal balance of all revolving loans, together
with accrued but unpaid interest and all other sums owing thereto,
will be due and payable in full on Nov. 15, 2010.
The Amendment amends the terms of certain financial covenants of
the company under the Amended Credit Agreement, including the
minimum fixed charge coverage ratio, the maximum leverage ratio,
the maximum senior secured leverage ratio and the minimum brand
value. Otherwise, the Amended Credit Agreement contains customary
covenants that are substantially the same as those existing prior
to the Amendment. Likewise, the Amended Credit Agreement contains
customary events of default, which are substantially the same as
those existing prior to the Amendment.
A copy of the Fifth Amendment may be viewed at no charge at:
http://ResearchArchives.com/t/s?17e2
Based in Chattanooga, Tennessee, Chattem Inc. (NASDAQ: CHTT)
-- http://www.chattem.com/-- manufactures and markets a variety
of branded consumer products, including over-the-counter
healthcare products and toiletries and skin care products. The
company's products include Icy Hot(R), Gold Bond(R), Selsun
Blue(R), Garlique(R), Pamprin(R) and BullFrog(R).
* * *
As reported in the TTroubled Company Reporter on Dec. 5, 2006
Moody's Investors Service confirmed the Ba3 corporate family
rating of Chattem Inc. and lowered the senior subordinated rating
to B2 from B1. The outlook is stable.
CITIZENS REPUBLIC: Merger Completion Prompt Fitch to Hold Ratings
-----------------------------------------------------------------
Citizens Banking Corporation has completed its acquisition of
Republic Bancorp Inc. and its subsidiaries.
Following this transaction, Fitch affirmed and upgraded certain
ratings of RBNC to be in line with those of CBCF (rated 'BBB/F2'
by Fitch). Concurrently, Fitch has withdrawn the issuer ratings
of RBNC, as this company is no longer an active entity. At the
same time, Fitch has affirmed the ratings of Citizens Republic
Bancorp (formerly Citizens Banking Corporation) and its principal
subsidiaries.
The following ratings are affirmed with a Stable Outlook:
Citizens Republic Bancorp
-- Issuer Default Rating (IDR) at 'BBB';
-- Subordinated debt at 'BBB-';
-- Short-term at 'F2';
-- Individual at 'B/C';
-- Support at '5'.
Citizens Bank
F&M Bank-Iowa
Republic Bank
-- Long-term deposits at 'BBB+';
-- Issuer default rating (IDR) at 'BBB';
-- Short-term deposits at 'F2';
-- Short-term at 'F2';
-- Individual at 'B/C';
-- Support at '5'.
CB Wealth Management, National Association
-- Issuer default rating (IDR) at 'BBB';
-- Short-term at 'F2';
-- Individual at 'B/C';
-- Support at '5'.
Citizens Funding Trust I
Republic Capital Trust I
-- Preferred stock at 'BBB-'.
These ratings have been affirmed and withdrawn:
Republic Bancorp Inc.
-- Issuer default rating (IDR) at 'BBB';
-- Individual at 'B/C';
-- Support at '5'.
This rating has been upgraded and withdrawn:
Republic Bancorp, Inc.
-- Short-term to 'F2' from 'F3'.
Contact: Doris Hoffmann +1-312
COLLINS & AIKMAN: Files Amended Joint Chapter 11 Plan
-----------------------------------------------------
Collins & Aikman Corporation and its debtor-affiliates have
filed their first amended joint plan and accompanying disclosure
statement.
The filing of the First Amended Plan fulfills one of Collins'
obligations under the comprehensive customer agreement,
negotiated with JPMorgan Chase Bank, N.A., as agent to the
senior, secured prepetition lenders; and major customers,
including DaimlerChrysler Corporation, Ford Motor Company,
General Motors Corporation, and Honda Motor Company, Inc.
Accordingly, the Plan is supported by JPMorgan and certain of the
customers.
Collins & Aikman said that it will now work expeditiously toward
satisfying various conditions to obtain approval of the
Disclosure Statement and Plan, and will ultimately exit Chapter
11 through sales of its assets.
"The Plan represents the Company's best opportunity to save
thousands of jobs and maximize recoveries for its creditors,"
said John Boken, chief restructuring officer. "We are pleased
that the agent for the Company's secured prepetition lenders, as
well as several of the Company's major customers, have agreed to
support the Plan as part of the Customer Agreement. More work
remains to be accomplished, but creating and filing the Plan
represents a major milestone in the Company's chapter 11 cases."
Under the Plan, Collins & Aikman will proceed with soliciting
qualified bids for the sale of the majority of its assets. The
Company expects to sell its operations, in whole or in parts, to
maximize the value of the enterprise for its creditors and
preserve the largest number of jobs for its employees.
Overview & Summary the Plan
Since filing a plan and disclosure statement on August 30, 2006,
the Debtors have determined that the proposed business plan
identified therein no longer offers the best way to maximize
value of their assets for the benefits of their creditors.
As a result of various factors, the Debtors' management, in
consultation with key constituencies in the Chapter 11 cases,
including the Prepetition Lenders, certain customers, and the
Official Committee of Unsecured Creditors, has determined that
the reorganization of the Debtors as a going concern is not
feasible.
Consequently, the Debtors have embarked on a sale process to
maximize the value that can be realized from the Debtors'
businesses and assets. The Sale Process contemplates, among
other things:
(i) a going concern sale of the Carpet & Acoustics business in
the Debtors' Soft Trim segment;
(ii) going concern sales of certain plants or divisions in the
Debtors' Plastics business segment and the Debtors'
Convertibles business;
(iii) an orderly wind-down of the Debtors' non-salable business
operations in cooperation with the customers;
(iv) sales of all remaining assets; and
(v) preservation of the Debtors' working capital assets and
mitigation of administrative claims and other wind-down
costs to the extent possible.
Sale Process
The Debtors believe that the Sale Process will be substantially
complete within eight months. Due to the significant number of
variables affecting the Sale Process, the Debtors cannot predict
the amount, if any, of net recoveries from the disposition of
those assets.
Based on the extensive M&A process conducted during the Chapter
11 cases, the Debtors expect that the sale of the Carpet &
Acoustics assets will yield a significant recovery for their
estates. The Debtors intend to sell their Carpet & Acoustics
assets on an expedited basis to prevent any loss of value from
the uncertainties and pressures surrounding the Sale Process.
Coincident with this, the Debtors will segregate the positive
cash flow generated by the Carpet & Acoustics operations while
the sale is pending and segregate the proceeds of the sale of the
operations for the benefit of creditors in the Chapter 11 Cases.
In conjunction with the Customer Agreement negotiated with their
major customers, and JPMorgan Chase Bank, N.A., as agent to the
Prepetition Lenders, the Debtors obtained long-term non-
resourcing commitments from the customers for the Carpet &
Acoustics business and obtained support for the expedited sale
process, which will enhance the value achieved in the sale.
In mid-October 2006, the Debtors and their advisors initiated the
sale process for the Carpet & Acoustics business as a stand-alone
entity. The Debtors and their advisors approached 13 potentially
interested parties to submit an indication of interest by
November 6, 2006. The unofficial steering committee of the
Prepetition Lenders together with the Debtors have selected a
final bidder subject to that bidder further revising its
indication of interest to incorporate certain additional
concessions. The Debtors expect to file a sale motion in January
2007.
In November and December 2006, the Debtors and their advisors
generated information packages on each of the five operating
segments and contacted over 70 potentially interested parties,
many of whom had been previously contacted through the M&A
process, to solicit interest.
To coordinate the sale of the numerous Plastics plants to an
expedited timetable, the Debtors, with the support of the
Steering Committee, may retain additional investment bankers with
specific and considerable knowledge and expertise in the
automotive parts supply industry.
Post-Consummation Trust
On or prior to the effective date of the Amended Plan, the
Debtors will consummate the Soft-Trim Sale Transaction. Both
prior to and subsequent to the Effective Date, the Debtors and
the Post-Consummation Trust, as applicable, will consummate the
Remaining Sales Transactions.
On the Effective Date, the Debtors, on their own behalf and on
behalf of the Holders of Allowed Prepetition Facility Claims,
will execute the Post-Consummation Trust Agreement and take all
other steps necessary to establish the Post-Consummation Trust.
The Debtors will transfer to the Post-Consummation Trust all of
their rights, title and interests in all assets of the Debtors
that are not divested prior to the Effective Date including, but
not limited to, as a result of the Soft-Trim Sales Transaction or
any Remaining Sales Transactions that are consummated prior to
the Effective Date -- the Residual Assets.
The Plan Administrator, as designated by JPMorgan, in
consultation with the Prepetition Lenders and the Creditors
Committee, will be appointed in accordance with the Post-
Consummation Trust Agreement.
The Post-Consummation Trust will terminate as soon as
practicable, but in no event later than the fifth anniversary of
the Effective Date; provided, that, on or prior to the date six
months prior to termination, the Bankruptcy Court, upon motion by
a party-in-interest, may extend the term of the Trust for a
finite period if an extension is necessary to liquidate the Post-
Consummation Trust Assets or to complete any distribution
required under the Plan.
The Plan Administrator, the Post-Consummation Trust, the
professionals of the Trust, the Post-Consummation Advisory Trust
Board and their representatives will be exculpated and
indemnified pursuant to the terms of the Post-Consummation Trust
Agreement.
Consummation of the Plan is conditioned to, among others, the
transfer to the Post-Confirmation Trust of the Residual Assets,
which should include no less that $3,000,000 in cash.
Litigation Trust
On the Effective Date, the Debtors will transfer to the
Litigation Trust all of their rights, title and interests in any
Causes of Action arising under Chapter 5 of the Bankruptcy Code
that are not released under the Plan or other Bankruptcy Court-
approved settlements.
The Debtors, on their own behalf and on behalf of the Holders of
Allowed Claims entitled to Litigation Trust Recovery Interests
pursuant to the Plan, will execute the Litigation Trust Agreement
and take all other steps necessary to establish the Litigation
Trust.
The Litigation Trust Administrator, as designated by JPMorgan, in
consultation with the Prepetition Lenders and the Creditors
Committee, will be appointed in accordance with the Litigation
Trust Agreement.
The Litigation Trust will terminate as soon as practicable, but
in no event later than the fifth anniversary of the Effective
Date; provided, that, on or prior to the date six months prior to
termination, the Bankruptcy Court, upon motion by a party-in-
interest, may extend the term of the Litigation Trust for a
finite period if an extension is necessary to liquidate the
Litigation Trust Claims.
The Litigation Trust Administrator, the Litigation Trust, the
professionals of the Litigation Trust and their representatives
will be exculpated and indemnified pursuant to the terms of the
Litigation Trust Agreement.
Employee, Retiree and Workers' Compensation Benefits
On or before the Effective Date, the Pension Benefit Guaranty
Corporation or the Debtors, as applicable, will terminate the
Debtors' existing employee benefit policies, plans and
agreements.
The Collins & Aikman Pension Plan, the sole tax-qualified United
States-defined benefit pension plan maintained by the Debtors,
will either be terminated by the Debtors involuntarily or by the
PBGC voluntarily. All nonqualified deferred compensation plans
will also be terminated.
>From and after the Effective Date, neither the Debtors nor the
Trusts will be obligated to pay retiree benefits or any similar
health and medical benefits in accordance with the terms of the
retiree benefit plans or other agreements governing the payment
of the benefits.
Conditions to Confirmation
Confirmation of the Plan is subject to the satisfaction of
various conditions, including:
(a) The Bankruptcy Court will have entered the Confirmation
Order in form and substance reasonably acceptable to the
Debtors and JPMorgan;
(b) The Bankruptcy Court will have entered a final order
approving the Customer Agreement;
(c) The Debtors will have consummated the Soft-Trim Sales
Transaction;
(d) The Bankruptcy Court will have entered an order or the
Debtors will have entered into an agreement with the
PBGC, either of which will provide that the Collins &
Aikman Pension Plan and other pension obligations for the
Debtors' United States employees are terminated; and
(e) The Bankruptcy Court will have entered an order providing
that there are no claims against the Post-Consummation
Trust under Section 1114 of the Bankruptcy Code.
Liquidation Analysis
The Debtors believe that the Amended Plan maximizes recoveries
for Holders of Allowed Claims. John R. Boken, the Debtors' chief
restructuring officer, relates that any alternative to
Confirmation of the Plan, including conversion of the Chapter 11
cases to cases under Chapter 7 of the Bankruptcy Code or attempts
by another party-in-interest to file a plan, would result in
significant delays, litigation and additional costs and,
ultimately, would lower the recoveries for Holders of Allowed
Claims.
In a liquidation under Chapter 7, there would be no recovery for
unsecured creditors classified in Classes 4, 5, 6, and 7,
Mr. Boken explains. He says that the proceeds of a liquidation
would not surpass amounts owed on account of the Prepetition
Facility Claims. Because all proceeds of any liquidation would
be subject to the liens and security interests of the Holders of
the Prepetition Facility Claims, nothing would be left for
unsecured creditors, he asserts.
Mr. Boken notes that the recovery under the Amended Plan provided
to Classes 4, 5, 6, and 7 is provided only because the acceptance
of the Plan by Class 3, Prepetition Facility Claims, permits the
recovery pursuant to certain provisions of Chapter 11 of the
Bankruptcy Code, which provisions would not be applicable in a
Chapter 7 proceeding.
The Debtors' liquidation analysis prepared by KZC Services, LLC,
the Debtors' restructuring consultants, and Lazard Freres & Co.
LLC, the Debtors' financial advisors, will be provided in a
subsequent filing no later than January 15, 2007.
About Collins & Aikman
Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in
cockpit modules and automotive floor and acoustic systems and is
a leading supplier of instrument panels, automotive fabric,
plastic-based trim, and convertible top systems. The Company
has a workforce of approximately 23,000 and a network of more
than 100 technical centers, sales offices and manufacturing
sites in 17 countries throughout the world. The Company and its
debtor-affiliates filed for chapter 11 protection on May 17,
2005 (Bankr. E.D. Mich. Case No. 05-55927). Richard M. Cieri,
Esq., at Kirkland & Ellis LLP, represents C&A in its
restructuring. Lazard Freres & Co., LLC, provides the Debtor
with investment banking services. Michael S. Stammer, Esq., at
Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors Committee. When the Debtors
filed for protection from their creditors, they listed
$3,196,700,000 in total assets and US$2,856,600,000 in total
debts. (Collins & Aikman Bankruptcy News, Issue No. 48;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
COLLINS & AIKMAN: Treatment & Classification of Claims Under Plan
-----------------------------------------------------------------
Under their First Amended Joint Plan of Reorganization, Collins &
Aikman Corporation and its debtor-affiliates group claims and
interests into 10 classes:
Class Designation Status/Recovery Voting Rights
----- ----------- --------------- -------------
n/a Administrative Claims 100% Recovery -
n/a Priority Tax Claims 100% Recovery -
1 Other Secured Claims Unimpaired deemed to accept
100% Recovery
2 Other Priority Claims Unimpaired deemed to accept
100% Recovery
3 Prepetition Facility Impaired entitled to vote
Claims
4 OEM Claims Impaired entitled to vote
5 General Unsecured Impaired entitled to vote
Claims
6 Senior Note Claims Impaired entitled to vote
and PBG Claims
7 Senior Subordinated Impaired entitled to vote
Note Claims
8 Equity Interests Impaired deemed to reject
0% Recovery
9 Subordinated Impaired deemed to reject
Securities Claims 0% Recovery
10 Intercompany Claims Impaired deemed to reject
0% Recovery
Net proceeds of the sales of the Debtors' assets, after payment
of the obligations outstanding under the company's Postpetition
Credit Agreement and all allowed administrative and priority
claims, will be distributed to holders of secured debt claims
under Collins & Aikman Corp.'s Prepetition Credit Agreement.
Trade and unsecured funded debt claims are expected to share in a
portion of the net proceeds from certain actions that will be
prosecuted by a Litigation Trust established under the Amended
Plan.
All existing equity interests in Collins & Aikman Corp. will be
canceled with no distribution.
As of December 20, 2006, Kurtzman Carson Consultants, LLC, the
Debtors' claims and solicitations agent, had received about 9,049
Claims:
(1) 1,025 Secured Claims totaling $3,091,616,331;
(2) 43 Administrative Claims totaling $2,380,409;
(3) 905 Priority Claims totaling $7,537,867,410; and
(4) 7,077 Unsecured Claims totaling $42,659,002,339.
The Debtors are in the process of objection proofs of claim that
are invalid, untimely, duplicative, or overstated. Through
withdrawal of claims and disallowance by the Bankruptcy Court
after objection, 554 claims totaling $4,414,393,899 have been
expunged.
The Debtors estimate that, at the conclusion of the claims
objection, reconciliation and resolution process, the aggregate
amount of claims will be:
Class Estimated Amounts
----- -----------------
Allowed Administrative Claims $70,000,000
Allowed Secured Claims $827,000,000
Allowed Priority Claims $12,000,000
Allowed Senior Note Claims $521,000,000
Allowed Senior Subordinated Note Claims $428,000,000
Allowed General Unsecured Claims $539,000,000
About Collins & Aikman
Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in
cockpit modules and automotive floor and acoustic systems and is
a leading supplier of instrument panels, automotive fabric,
plastic-based trim, and convertible top systems. The Company
has a workforce of approximately 23,000 and a network of more
than 100 technical centers, sales offices and manufacturing
sites in 17 countries throughout the world. The Company and its
debtor-affiliates filed for chapter 11 protection on May 17,
2005 (Bankr. E.D. Mich. Case No. 05-55927). Richard M. Cieri,
Esq., at Kirkland & Ellis LLP, represents C&A in its
restructuring. Lazard Freres & Co., LLC, provides the Debtor
with investment banking services. Michael S. Stammer, Esq., at
Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors Committee. When the Debtors
filed for protection from their creditors, they listed
$3,196,700,000 in total assets and US$2,856,600,000 in total
debts.
(Collins & Aikman Bankruptcy News, Issue No. 48; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
COMPUTER SCIENCES: Bondholders Waive Filing Deadline to Jan. 5
--------------------------------------------------------------
Computer Sciences Corp. successfully completed its previously
disclosed consent solicitation from the holders of record as of
Dec. 11, 2006, of the $200-million aggregate outstanding principal
amount of its 6-1/4% Notes due March 15, 2009, issued under the
Indenture, dated as of March 8, 1999, among CSC, as issuer, and
Citibank, N.A., a national banking association, as trustee.
CSC was requesting a one-time waiver of any default or event of
default that has arisen or may arise by virtue of CSC's failure to
file with the U.S. Securities and Exchange Commission and furnish
to the Trustee and holders of the Notes, certain reports required
to be so filed and furnished by CSC pursuant to the terms of the
Indenture.
Approval of the Waiver effectively extends the existing 30-day
cure period in the Indenture by 60 days with respect to the
reporting requirements in the Indenture, which is consistent with
the cure period for the reporting requirements under the
indentures that govern CSC's three other outstanding series of
notes and similar to the cure period provided in the waiver of
default granted on Nov. 17, 2006, by CSC's lenders under its
US$1 billion credit agreement for failure to comply with the
reporting covenant in the Credit Agreement.
Each holder of record on Dec. 11, 2006, who validly delivered
their consent, and did not revoke such consent, will receive a
payment of $1.25 for each $1,000 principal amount of Notes to
which such consent related. If CSC has not filed its 2007 Second
Quarter Report with the SEC on or before 5:30 p.m., New York City
time, on Jan. 5, CSC will pay on the following business day, or as
promptly as practicable thereafter, to each holder of record on
Dec. 11, 2006, who validly delivered their consent, and did not
revoke such consent, an additional $1.25 for each $1,000 in
principal amount of Notes.
Merrill Lynch & Co. acted as Solicitation Agent for the consent
solicitation. Global Bondholder Services acted as the
Tabulation/Information Agent.
Headquartered in El Segundo, Calif., Computer Sciences Corporation
(NYSE: CSC) -- http://www.csc.com/-- is a global information
technology services company. The company's services include
systems design and integration; IT and business process
outsourcing; applications software development; Web and
application hosting; and management consulting. It maintains
operations in Australia, China, Czech Republic, Slovakia, Denmark,
France, among others.
COMSTOCK HOMEBUILDING: Settles Default Notice Dispute with BofA
---------------------------------------------------------------
Comstock Homebuilding Companies Inc. settled its dispute with Bank
of America over the company's purported default on its credit
agreement, Dow Jones Newswires reports.
Dow Jones relates that the company made a $5 million principal
curtailment on its unsecured line of credit with the bank and
entered agreements extending the maturity dates and curtailment
requirements of all remaining outstanding loans with BofA.
BofA has withdrawn its notice of default and declared that the
company was in compliance of its obligations.
As previously reported in the Troubled Company Reporter, the
company received, on Oct. 18, 2006, a purported Notice of Default
from BofA under a Deed of Trust Note and Loan Agreement dated
Sept. 18, 2005 regarding the Company's Commons at Bellemeade
project in Leesburg, Virginia.
The purported Notice results from a claim by the bank that the
company failed to make a $2.7 million cash curtailment which the
Lender asserted was due on Sept. 30, 2006. The company informed
the bank that it disputed the validity of the Notice and of its
intent to compel arbitration to resolve the dispute.
Pursuant to ongoing discussions with the bank, the company
asserted that the payment was not currently due and payable as
demanded by the bank based on the fact that the Note had not been
fully funded by the bank pursuant to its terms and conditions.
Specifically, the dispute results from a provision in the Note
that stipulates what the maximum outstanding commitments of the
bank would be to the Project on certain established dates. The
Note outlines approximately $12.5 million of cash curtailments
required by Sept. 30, 2006 to reduce the outstanding commitment of
the Note to $33,775,000 predicated on the company having drawn the
approximately $46 million of total funding available for
acquisition and improvements at the Project.
Based in Reston, Virginia, Comstock Homebuilding Companies Inc.
(Nasdaq: CHCI) -- http://www.comstockhomebuilding.com/-- is a
diversified real estate development firm with a focus on
moderately priced for-sale residential products. Established in
1985, Comstock builds and markets single-family homes, townhouses,
mid-rise condominiums, high-rise condominiums, mixed-use urban
communities and active adult communities. The Company currently
markets its products under the Comstock Homes brand in the
Washington, D.C., Raleigh, North Carolina, Atlanta, Georgia and
parts of the Carolinas. Comstock develops mixed-use, urban
communities and active-adult communities under the Comstock
Communities brand.
* * *
As reported in the Troubled Company Reporter on Sept. 20, 2006,
Standard & Poor's Ratings Services revised its outlook on Comstock
Homebuilding Cos. Inc. to negative and affirmed its 'B+' corporate
credit rating. Comstock has no publicly rated debt outstanding.
COVALENCE SPECIALTY: Poor Results Prompt S&P's Negative Outlook
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Covalence Specialty Materials Corp. to negative from positive.
The outlook change follows a weaker-than-expected trend in the
company's operating and financial performance in fiscal 2006 and
expectations for 2007, and the resultant deterioration in credit
measures.
Ratings on the company, including the 'B' corporate credit rating,
were affirmed. The Princeton, New Jersey-based company had about
$739 million in debt outstanding as of Sept. 29, 2006.
"The outlook revision reflects the company's disappointing
earnings results for fiscal 2006 [particularly in the fourth
quarter ended Sept. 29, 2006] caused by softness in housing and
retail end markets, and inventory management by distributors in
view of the declining resin price trends," said Standard & Poor's
credit analyst Liley Mehta. The negative outlook also
incorporates the company's EBITDA guidance of $10 million for the
first quarter of fiscal 2007 as a result of a steep decline in
sales volumes, competitive pricing pressures, and planned plant
shutdowns by the company to reduce inventory levels. As a result
of the weak operating results expected in fiscal 2007, the
company's debt leverage is expected to increase somewhat from
already high levels of 6x at Sept. 29, 2006.
The ratings reflect Covalence's vulnerable business risk profile,
incorporating its exposure to industrial and other end markets
tied to general economic activity, and vulnerability to volatile
raw-material costs. The ratings also incorporate the company's
aggressive debt leverage and low operating margins that reflect a
moderate dependence on commodity-like products. These negative
factors outweigh the benefits of leading market positions in
various plastic films market segments, considerable scale, and
decent product and customer diversity.
Given the company's heavy debt burden and limited operating
profitability, preservation of sufficient liquidity under the
revolving credit facility is a key underpinning for the rating.
Expectations for somewhat slower economic growth and that raw-
material costs will remain at elevated levels or increase in 2007
could call into question Covalence's ability to sustain sequential
improvement in operating performance in the next few quarters from
very weak levels estimated for the first quarter of fiscal 2007.
Accordingly, ratings could be lowered within the next 12 months if
liquidity deteriorates beyond expected levels or if the company
fails to establish a track record of sequential earnings
improvement and free cash flow by the end of fiscal 2007 third
quarter ending June 30, 2007.
CRUSADER INSURANCE: A.M. Best to Lifts Financial Strength Rating
----------------------------------------------------------------
A.M. Best Co. has upgraded the financial strength rating to B++
(Good) from B+ (Good) and the issuer credit rating to "bbb" from
"bbb-" of Crusader Insurance Company (Woodland Hills, CA).
The outlook for both ratings is stable.
The rating actions reflect Crusader's solid capitalization,
improved underwriting and operating performance, as well as its
strong regional market presence and explicit financial support
from its publicly traded parent, Unico American Corporation
[NASD: UNAM]. These positive factors are offset by sub par
underwriting and operating results posted during the 2000-2003
period, driven by adverse loss reserve development and the
company's limited geographical spread of risk. However, due to
numerous corrective actions taken by Crusader's management team in
recent years, the improved operating performance is expected to be
sustainable. As a result, the rating outlook reflects A.M. Best's
expectations that the recent improvement in operating performance
and capitalization will be sustainable over the medium term.
A.M. Best Co., established in 1899, is the world's oldest and most
authoritative insurance rating and information source.
CSFB HOME: S&P Cuts Ratings on Six Classes and Places Neg. Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on six
classes from five series of home equity pass-through certificates
issued by CSFB Home Equity Asset Trust, and placed them on
CreditWatch with negative implications.
In addition, ratings on two classes from two series were lowered
and remain on CreditWatch with negative implications, where they
were placed in November 2006. Concurrently, the ratings on four
other classes from four series were placed on CreditWatch with
negative implications, and the ratings on 256 classes from 34
series were affirmed.
The downgrades and negative CreditWatch placements reflect the
continued erosion of the classes' credit support. These
transactions have been incurring losses well in excess of monthly
excess interest cash flows, causing the overcollateralization
(O/C) to steadily decrease. The O/C for these deals has already
stepped down to the respective O/C floor of 0.50% of the original
pool balances. Consequently, these transactions are below their
respective O/C targets.
In addition, cash flow projections indicate further erosion of the
O/C for each transaction. As of the November 2006 remittance
period, total delinquencies for these transactions ranged from
31.42% (series 2003-5) to 41.07% (series 2002-2) of the current
pool balances. Cumulative realized losses ranged from 0.99%
(series 2003-4) to 2.12% (series 2002-2) of the original pool
balances. As of the November 2006 remittance, these transactions
had remaining pool balances that ranged from 7.68% (series 2002-2)
to 15.75% (series 2003-6) of their original pool balances.
Standard & Poor's will continue to closely monitor the performance
of these transactions. If losses decline to a point at which they
no longer exceed excess interest, and the level of O/C has not
been further eroded, S&P will affirm the ratings and remove them
from CreditWatch. Conversely, if losses continue to exceed excess
interest and further erode O/C, S&P will take additional negative
rating actions.
The affirmed ratings reflect the adequate actual and projected
credit support percentages and the shifting interest structure of
the transactions. As of the November 2006 remittance period,
total delinquencies for the transactions with affirmed ratings
ranged from 7.82% (series 2006-3) to 39.54% (series 2002-4) of the
current pool balances. Cumulative realized losses ranged from 0%
(series 2006-1, 2006-2, and 2006-3) to 2.26% (series 2002-1) of
the original pool balances. Furthermore, 22 of the 25 transactions
with all affirmed ratings had cumulative realized losses of less
than 1% of their original pool balances.
Thirteen of the 25 transactions are below their respective O/C
targets (series 2003-8 through series 2005-4). The other 12,
series 2005-5 through series 2006-4, are at their respective O/C
targets. None of these transactions has stepped down yet,
although series 2003-8 will begin to step-down its O/C in two
months.
Credit support for these transactions is provided by
subordination, O/C, and excess interest cash flow. The collateral
consists of 30-year fixed- and adjustable-rate, first- and second-
lien subprime mortgage loans secured by one- to four-family
residential properties.
Ratings lowered and placed on CreditWatch negative:
Rating
------
Series Class To From
------ ----- -- ----
2002-2 B-1 BB/Watch Neg BBB+
2002-3 B-1 BB/Watch Neg BBB+
2002-5 B-1 BB/Watch Neg BBB+
2003-3 B-2 BB/Watch Neg BBB
2003-3 B-3 BB-/Watch Neg BBB-
2003-5 B-3 BB-/Watch Neg BBB-
Ratings lowered and remaining on CreditWatch negative:
Rating
------
Series Class To From
------ ----- -- ----
2003-1 B-3 B/Watch Neg BB-/Watch Neg
2003-2 B-2 B/Watch Neg BB/Watch Neg
Ratings placed on CreditWatch negative:
Rating
------
Series Class To From
------ ----- -- ----
2003-1 B-2 BBB/Watch Neg BBB
2003-4 B-3 BBB-/Watch Neg BBB-
2003-5 B-2 BBB/Watch Neg BBB
2003-6 B-3 BBB-/Watch Neg BBB-
Ratings affirmed:
Series Class Rating
------ ----- ------
2002-1 A-2, A-3, A-4 AAA
2002-1 M-1 AA+
2002-1 M-2 A+
2002-1 B-1 BB/Watch Neg
2002-2 A-2, A-3, A-4 AAA
2002-2 M-1 AA+
2002-2 M-2 A+
2002-3 A-2, A-4, A-5 AAA
2002-3 M-1 AA+
2002-3 M-2 A
2002-4 M-1 AA+
2002-4 M-2 A
2002-4 B-1 BBB+
2002-5 M-1 AA
2002-5 M-2 A
2003-1 M-1 AA
2003-1 M-2 A+
2003-1 M-3 A
2003-1 B-1 BBB+
2003-2 M-1 AA
2003-2 M-2 A+
2003-2 M-3 A
2003-2 B-1 BBB+/Watch Neg
2003-3 M-1 AA
2003-3 M-2 A
2003-3 M-3 A-
2003-3 B-1 BBB+
2003-4 M-1 AA
2003-4 M-2 A
2003-4 M-3 A-
2003-4 B-1 BBB+
2003-4 B-2 BBB
2003-5 A-1, A-2 AAA
2003-5 M-1 AA
2003-5 M-2 A
2003-5 M-3 A-
2003-5 B-1 BBB+
2003-6 M-1 AA
2003-6 M-2 A
2003-6 M-3 A-
2003-6 B-1 BBB+
2003-6 B-2 BBB
2003-6 B-3 BBB-
2003-7 M-1 AA
2003-7 M-2 A
2003-7 M-3 A-
2003-7 B-1 BBB+
2003-7 B-2 BBB
2003-7 B-3 BBB-
2003-8 A-1, A-2 AAA
2003-8 M-1 AA
2003-8 M-2 A
2003-8 M-3 A-
2003-8 B-1 BBB+
2003-8 B-2 BBB
2003-8 B-3 BBB-
2004-1 A-1, A-2, A-4 AAA
2004-1 M-1 AA
2004-1 M-2 A+
2004-1 M-3 A
2004-1 B-1 A-
2004-1 B-2 BBB+
2004-1 B-3 BBB
2004-2 A-1, A-2, A-4 AAA
2004-2 M-1 AA
2004-2 M-2, M-3 A
2004-2 B-1 A-
2004-2 B-2 BBB+
2004-2 B-3 BBB-
2004-3 A-1, A-2, A-4 AAA
2004-3 M-1 AA
2004-3 M-2, M-3 A
2004-3 B-1 A-
2004-3 B-2 BBB+
2004-3 B-3 BBB
2004-4 A-1, A-2, A-4, A-IO-1, A-IO-2 AAA
2004-4 M-1 AA+
2004-4 M-2 AA
2004-4 M-3 AA-
2004-4 M-4 A+
2004-4 M-5, M-6 A
2004-4 B-1 A-
2004-4 B-2 BBB+
2004-4 B-3 BBB
2004-5 A-1, A-3, A-IO-1, A-IO-2 AAA
2004-5 M-1 AA+
2004-5 M-2 AA
2004-5 M-3 AA-
2004-5 M-4 A+
2004-5 M-5, M-6 A
2004-5 B-1 A-
2004-5 B-2 BBB+
2004-5 B-3 BBB-
2004-6 A-1, A-2, A-IO-1, A-IO-2 AAA
2004-6 M-1, M-2 AA+
2004-6 M-3 AA
2004-6 M-4 AA-
2004-6 M-5 A+
2004-6 M-6 A
2004-6 B-1 A-
2004-6 B-2 BBB+
2004-6 B-3 BBB
2004-6 B-4 BBB-
2004-7 A-1, A-2, A-3, A-5, A-IO-1, A-IO-2 AAA
2004-7 M-1, M-2 AA+
2004-7 M-3 AA
2004-7 M-4 AA-
2004-7 M-5 A+
2004-7 M-6 A
2004-7 B-1 A-
2004-7 B-2 BBB+
2004-7 B-3 BBB
2004-7 B-4 BBB-
2004-8 A-1, A-2, A-3, A-4, A-IO-1, A-IO-2 AAA
2004-8 M-1 AA+
2004-8 M-2, M-3 AA
2004-8 M-4 AA-
2004-8 M-5 A+
2004-8 M-6 A
2004-8 B-1 A-
2004-8 B-2 BBB+
2004-8 B-3 BBB
2004-8 B-4 BBB-
2005-1 A-1, A-2, A-3, A-IO-1, A-IO-2 AAA
2005-1 M-1 AA+
2005-1 M-2, M-3 AA
2005-1 M-4 AA-
2005-1 M-5 A+
2005-1 M-6 A
2005-1 M-7 A-
2005-1 B-1 BBB+
2005-1 B-2 BBB
2005-1 B-3 BBB-
2005-2 I-A-1, 2-A-2, 2-A-3, A-IO-1, A-IO-2 AAA
2005-2 M-1 AA+
2005-2 M-2 AA
2005-2 M-3 AA-
2005-2 M-4 A+
2005-2 M-5 A
2005-2 M-6 A-
2005-2 B-1 BBB+
2005-2 B-2 BBB
2005-2 B-3 BBB-
2005-2 B-4 BB+
2005-3 I-A-1, I-A-2, 2-A-1, 2-A-2, 2-A-3 AAA
2005-3 A-IO-1, A-IO-2 AAA
2005-3 M-1 AA+
2005-3 M-2 AA
2005-3 M-3 AA-
2005-3 M-4 A+
2005-3 M-5 A
2005-3 M-6 A-
2005-3 B-1 BBB+
2005-3 B-2 BBB
2005-3 B-3, B-4 BBB-
2005-4 I-A-1, I-A-2, 2-A-1, 2-A-2, 2-A-3, P AAA
2005-4 M-1 AA+
2005-4 M-2, M-3 AA
2005-4 M-4 AA-
2005-4 M-5 A+
2005-4 M-6 A
2005-4 M-7 A-
2005-4 B-1 BBB+
2005-4 B-2 BBB
2005-4 B-3 BBB-
2005-5 I-A-1, I-A-2, 2-A-1, 2-A-2, 2-A-3, P AAA
2005-5 M-1 AA+
2005-5 M-2, M-3 AA
2005-5 M-4 AA-
2005-5 M-5 A+
2005-5 M-6 A
2005-5 M-7 BBB+
2005-5 B-1 BBB
2005-5 B-2, B-3 BBB-
2005-6 I-A-1, I-A-2, 2-A-1, 2-A-2, 2-A-3, P AAA
2005-6 M-1, M-2 AA+
2005-6 M-3, M-4 AA
2005-6 M-5 AA-
2005-6 M-6 A+
2005-6 M-7 A
2005-6 M-8 A-
2005-6 B-1 BBB+
2005-6 B-2 BBB
2005-6 B-3 BBB-
2005-6 B-4 BB+
2005-7 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2005-7 M-1 AA+
2005-7 M-2, M-3 AA
2005-7 M-4 AA-
2005-7 M-5 A+
2005-7 M-6 A
2005-7 M-7 A-
2005-7 B-1 BBB+
2005-7 B-2 BBB
2005-7 B-3 BBB-
2005-7 B-4, B-5 BB+
2005-8 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2005-8 M-1, M-2 AA+
2005-8 M-3, M-4 AA
2005-8 M-5, M-6 A+
2005-8 M-7, M8 A-
2005-8 B-1, B-2 BBB+
2005-8 B-3, B-4 BBB-
2005-8 B-5 BB+
2005-9 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2005-9 M-1, M-2 AA+
2005-9 M-3, M-4, M-5 AA
2005-9 M-6 A+
2005-9 M-7, M-8 A
2005-9 B-1 A-
2005-9 B-2 BBB+
2005-9 B-3 BBB
2005-9 B-4 BBB-
2005-9 B-5 BB+
2006-1 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2006-1 M-1, M-2 AA+
2006-1 M-3, M-4 AA
2006-1 M-5 AA-
2006-1 M-6 A+
2006-1 M-7 A
2006-1 M-8 A-
2006-1 B-1 BBB+
2006-1 B-2 BBB
2006-1 B-3 BBB-
2006-2 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2006-2 M-1, M-2 AA+
2006-2 M-3, M-4, M-5 AA
2006-2 M-6 A+
2006-2 M-7 A
2006-2 M-8 A-
2006-2 B-1 BBB+
2006-2 B-2 BBB
2006-2 B-3 BBB-
2006-2 B-4 BB+
2006-2 B-5 BB
2006-3 I-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2006-3 M-1, M-2 AA+
2006-3 M-3, M-4 AA
2006-3 M-5 AA-
2006-3 M-6 A+
2006-3 M-7 A-
2006-3 M-8, B-1 BBB+
2006-3 B-2 BBB
2006-3 B-3 BBB-
2006-3 B-4 BB+
2006-3 B-5 BB
2006-4 1-A-1, 2-A-1, 2-A-2, 2-A-3, 2-A-4, P AAA
2006-4 M-1 AA+
2006-4 M-2, M-3, M-4 AA
2006-4 M-5 A+
2006-4 M-6 A
2006-4 M-7 A-
2006-4 M-8 BBB+
2006-4 B-1 BBB
2006-4 B-2 BBB-
2006-4 B-3 BB+
2006-4 B-4 BB
CWALT INC: Fitch Puts Low-B Ratings on $6.8 Million Class Certs.
----------------------------------------------------------------
Fitch rates CWALT, Inc.'s Mortgage Pass-Through Certificates,
Alternative Loan Trust 2006-43CB as:
Groups 1 and 2
-- $733.8 million classes 1-A-1, through 1-A-20, 1-X, PO,
2-A-1, 2-X and A-R (senior certificates) 'AAA';
-- $12.9 million class M 'AA';
-- $6.1 million class B-1 'A';
-- $4.2 million class B-2 'BBB';
-- $3.0 million class B-3 'BB';
-- $2.2 million class B-4 'B'.
Group 3
-- $110.3 million classes 3-A-1 through 3-A-4, 3-X, and III-PO
(senior certificates) 'AAA';
-- $4.0 million class III-M 'AA';
-- $1.8 million class III-B-1 'A';
-- $1.3 million class III-B-2 'BBB';
-- $960,000 class III-B-3 'BB';
-- $719,900 class III-B-4 'B'.
The 'AAA' rating on the Groups 1 and 2 senior certificates
reflects the 4.00% subordination provided by the 1.70% class M,
0.80% class B-1, 0.55% class B-2, 0.40% privately offered class B-
3, 0.30% privately offered class B-4, and 0.25% privately offered
class B-5. The class B-5 is not rated by Fitch.
The 'AAA' rating on the Group 3 senior certificates reflects the
8.00% subordination provided by the 3.35% class III-M, 1.55% class
III-B-1, 1.15% class III-B-2, 0.80% privately offered class III-B-
3, 0.60% privately offered class III-B-4, and 0.55% privately
offered class III-B-5. The class III-B-5 is not rated by Fitch.
Fitch believes the above credit enhancement for each respective
loan group will be adequate to support mortgagor defaults. In
addition, the rating also reflects the quality of the underlying
mortgage collateral, strength of the legal and financial
structures and the master servicing capabilities of Countrywide
Home Loans Servicing LP, rated 'RMS1-' by Fitch. Countrywide
Servicing is a direct wholly owned subsidiary of Countrywide Home
Loans, Inc.
The certificates represent ownership interests in a trust fund
that consists of three pools of mortgage loans. The senior
certificates whose class designation begins with 1 and 2
correspond to pools 1 and 2, respectively. Each of the senior
certificates generally receives distributions based on principal
and interest collected from mortgage loans in its corresponding
mortgage pool. If on any distribution date a pool is
undercollateralized and borrower payments from the underlying
loans are insufficient to pay senior certificate principal and
interest, borrower payments from the other pool that would have
been distributed to the subordinate certificates will instead be
distributed as principal and interest to the undercollateralized
group's senior certificates. The subordinate certificates will
only receive principal and/or interest distributions after all the
senior certificates receive all their required principal and
interest distributions.
The Group 3 certificates receive payments from the related pool 3
loans only.
Loan Group 1 consists primarily of 30-year conventional, fully
amortizing mortgage loans totaling $737,440,552 as of the cut-off
date, Dec. 1, 2006, secured by first liens on one- to four-family
residential properties. The mortgage pool, as of the cut-off
date, demonstrates an approximate weighted-average original-loan-
to-value (OLTV) of 67.02%. The weighted average FICO credit score
is approximately 717. Cash-out refinance loans represent 44.8% of
the mortgage pool and second homes 4.8%. The average loan balance
is $221,122. The states that represent the largest portion of
mortgage loans are California (28.5%) and Florida (9.7%). All
other states represent less than 5% of the cut-off date pool
balance.
Loan Group 2 consists primarily of 30-year conventional, fully
amortizing mortgage loans totaling $26,998,563 as of the cut-off
date, Dec. 1, 2006, secured by first liens on one- to four-family
residential properties. The mortgage pool, as of the cut-off
date, demonstrates an approximate weighted-average OLTV of 62.18%.
The weighted average FICO credit score is approximately 691.
Cash-out refinance loans represent 55.1% of the mortgage pool and
second homes 8.4%. The average loan balance is $109,306. The
three states that represent the largest portion of mortgage loans
are Florida (11.9%), Texas (8.6%), and Wisconsin (8.3%). All
other states represent less than 5% of the cut-off date pool
balance.
Loan Group 3 consists primarily of 30-year conventional, fully
amortizing mortgage loans totaling $119,996,943 as of the cut-off
date, December 1, 2006, secured by first liens on one- to four-
family residential properties. The mortgage pool, as of the cut-
off date, demonstrates an approximate weighted-average OLTV of
77.58%. The weighted average FICO credit score is approximately
694. Cash-out refinance loans represent 32.0% of the mortgage
pool and second homes 5.1%. The average loan balance is $190,774.
The four states that represent the largest portion of mortgage
loans are Florida (14.1%), California (11.7%), Arizona (8.6%), and
Texas (6.7%). All other states represent less than 5% of the cut-
off date pool balance.
CWALT purchased the mortgage loans from CHL and deposited the
loans in the trust, which issued the certificates, representing
undivided beneficial ownership in the trust. The Bank of New York
will serve as trustee. For federal income tax purposes, an
election will be made to treat the trust fund as one or more real
estate mortgage investment conduits.
DATALOGIC INTERNATIONAL: CFO Keith Nguyen Resigns
-------------------------------------------------
DataLogic International, Inc.'s chief financial officer and chief
accounting officer, Keith D. Nguyen, resigned from his position
effective Dec. 21, 2006.
Keith Moore, chairman and chief executive officer, has assumed the
position of chief financial officer and chief accounting officer.
Mr. Moore has served as chairman and chief executive officer of
the company since January 2005. From April 1999 to January 2005,
Mr. Moore served as chairman and chief executive officer of
iTechexpress, Inc.
Mr. Moore received his Bachelors degree in Finance from Eastern
Michigan University in 1982 and his Masters degree from Eastern
Michigan University in Finance in 1984. Mr. Moore also serves as
member of the board of directors of Monarch Staffing, Inc. and
Remote Dynamics, Inc.
DataLogic International, Inc. -- http://www.dlgi.com/-- is a
technology and professional services company providing a wide
range of consulting services and communication solutions like GPS
based mobile asset tracking, secured mobile communications and
VoIP. The company also provides Information Technology
outsourcing and private label communication solutions.
DataLogic's customers include U.S. and international governmental
agencies as well as a variety of international commercial
organizations.
Going Concern Doubt
As reported in the Troubled Company Reporter on May 17, 2006,
Corbin & Company, LLP, in Irvine, California, raised substantial
doubt about DataLogic's ability to continue as a going concern
after auditing the Company's consolidated financial statements for
the year ended Dec. 31, 2005. The auditor pointed to the
company's recurring losses and need to establish profitable
operations.
DELTA AIR: Disclosure Statement Hearing Scheduled on February 7
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has set 2:30 p.m., on Feb. 7, 2007, to consider the adequacy of
the Disclosure Statement explaining Delta Air Lines Inc. and its
debtor affiliates' Joint Chapter 11 Plan of Reorganization.
Objections to the Disclosure Statement, if any, must be filed by
Jan. 25, 2007.
Overview of the Plan
As reported in the Troubled Company Reporter on Dec. 20, 2006, the
Debtors' Disclosure Statement includes an overview of Delta's
restructuring progress and other information about the company, a
description of distributions to creditors and an analysis of the
Plan's feasibility, as well as many of the technical matters
required for the Chapter 11 exit process, such as descriptions of
who will be eligible to vote on the Plan and the voting process.
Under the Plan, unsecured creditors generally will receive
distributions of new Delta common stock to settle their claims.
Current holders of Delta common stock will receive no
distribution, and those securities will be canceled upon the
effective date of the Plan.
Delta has said for some time that the company expected its common
stock would not have any value under any Plan of Reorganization
the company might propose.
The Plan contemplates rolling Delta's debtor-in-possession
financing of approximately $2.1 billion into a new financing
package that would go into effect when Delta emerges from
Chapter 11.
Delta has received multiple proposals with competitive terms and
conditions for this exit financing.
A full-text copy of Delta's Disclosure Statement is available for
free at http://ResearchArchives.com/t/s?175d
A full-text copy of Delta's standalone reorganization plan is
available for free at http://ResearchArchives.com/t/s?175f
Full-text copies of the exhibits to Delta's Disclosure Statements
are available for free at http://ResearchArchives.com/t/s?1760
About Delta Air
Headquartered in Atlanta, Georgia, Delta Air Lines (OTC: DALRQ)
-- http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities.
DELTA MILLS: Court Sets February 1 as General Claims Bar Date
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware set Feb. 1,
2007, as the deadline for all creditors owed money by Delta Mills,
Inc., Delta Woodside Industries, Inc., and Delta Mills Marketing,
Inc., on account of claims arising on or before Oct. 13, 2006,
and on account of administrative expense claims arising between
Oct. 13, 2006 and Dec. 15, 2006, to file their proofs of claim.
Proofs of claim and requests for payment of administrative
expenses must be filed on or before the Feb. 1 Claims Bar Date at
4:00 p.m. ET to:
* via U.S. mail:
Delta Mills, Inc.
Claims Processing Center
P.O. Box 5082
FDR Station
New York, NY 10150-5082
* via delivery by hand, courier, or overnight service:
Delta Mills, Inc.
Claims Processing Center
757 Third Avenue, 3rd Floor
New York, NY 10017
Delta Mills Inc. manufactures and sells textile products for the
apparel industry. The Company, its parent, Delta Woodside
Industries, Inc., and an affiliate, Delta Mills Marketing, Inc.,
filed for chapter 11 protection on Oct. 13, 2006 (Bankr. D. Del.
Case No. 06-11144). Robert J. Dehney, Esq., at Morris, Nichols,
Arsht & Tunnell, represents the Debtors. When the Debtors filed
for protection from their creditors, they listed estimated assets
and debts between $1 million to $100 million. The Debtors'
exclusive period to file a chapter 11 plan expires on Feb. 10,
2007.
DURA AUTOMOTIVE: Hires Kurtzman Carson as Claims & Notice Agent
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware allowed
DURA Automotive Systems, Inc. and its debtor affiliates to employ
Kurtzman Carson Consultants, LLC, as their notice, claims and
balloting agent.
The Debtors have approximately 84,000 potential creditors. The
office of the Clerk of the Bankruptcy Court for the District of
Delaware is not equipped to efficiently and effectively serve
notice on the large number of creditors and parties-in-interest
and administer claims during the Debtors' Chapter 11 cases. "The
sheer size and magnitude of the Debtors' creditor body makes it
impracticable for the Clerk's Office to undertake that task,"
Keith Marchiando, chief financial officer, says.
Kurtzman Carson is expected to:
(a) prepare and serve required notices in the Debtors'
Chapter 11 cases:
* a notice of the commencement of the Reorganization
Cases and the initial meeting of creditors under
Section 341(a) of the Bankruptcy Code;
* a notice of the claims bar date;
* notices of objections to claims;
* notices of any hearings on a disclosure statement and
confirmation of a plan or plans of reorganization;
and
* other miscellaneous notices as the Debtors or the
Court may deem necessary or appropriate for an
orderly administration of the Debtors' Chapter 11
cases;
(b) within three business days after the service of a
particular notice, prepare for filing with the Clerk's
Office a certificate or affidavit of service that includes
an alphabetical list of persons on whom the notice was
served, along with their addresses, and the date and
manner of service;
(c) maintain copies of all proofs of claim and proofs of
interest filed;
(d) maintain official claims registers by docketing all proofs
of claim and proofs of interest in a claims database that
includes this information for each claim or interest
asserted:
* the name and address of the claimant or interest
holder and any agent thereof, if the proof of claim
or proof of interest was filed by an agent;
* the date the proof of claim or proof of interest was
received by Kurtzman and the Court;
* the claim number assigned to the proof of claim or
proof of interest; and
* the asserted amount and classification of the claim;
(e) implement necessary security measures to ensure the
completeness and integrity of the claims registers;
(f) transmit to the Clerk's Office a copy of the claims
registers on a weekly basis unless requested more or less
frequently by the Clerk's Office;
(g) maintain an up-to-date mailing list for all entities that
have filed proofs of claim or proofs of interest and make
that list available upon request to the Clerk's Office or
any party-in-interest;
(h) provide access to the public for examination of copies of
the proofs of claim or proofs of interest filed without
charge during regular business hours;
(i) record all transfers of claims pursuant to Rule 3001(e) of
the Federal Rules of Bankruptcy Procedure and, if directed
by the Court, provide notice of those transfers as
required by Bankruptcy Rule 3001(e);
(j) comply with applicable federal, state, municipal, and
local statutes, ordinances, rules, regulations, orders,
and other requirements;
(k) provide temporary employees to process claims as
necessary;
(l) promptly comply with further conditions and requirements
as the Clerk's Office or the Court may at any time
prescribe;
(m) provide other claims processing, noticing, balloting, and
related administrative services as may be requested from
time to time by the Debtors; and
(n) act as balloting agent, which may include some or all of
these services:
* printing of ballots, including the printing of
creditor and shareholder specific ballots;
* preparing voting reports by plan class, creditor, or
shareholder and amount for review and approval by the
client and its counsel;
* coordinating the mailing of ballots, disclosure
statement, and plan of reorganization to all voting
and non-voting parties, and provide affidavit of
service;
* establishing a toll-free "800" number to receive
questions regarding voting on the plan; and
* receiving ballots at a post office box, inspecting
ballots for conformity to voting procedures, date
stamping and numbering ballots consecutively, and
tabulating and certifying the results.
In addition, at the Debtors' request, Kurtzman will assist the
Debtors with, among other things:
(1) preparing and mailing customized proofs of claim to the
creditors listed on the Debtors' Schedules of Liabilities,
(2) preparing, mailing, and tabulating ballots of certain
creditors for the purpose of voting to accept or reject
the plan or plans of reorganization; and
(3) any other additional services requested by the Debtors.
Kurtzman will bill:
Professional Hourly Rate
------------ -----------
Clerical -- data input $40 - $65
Project Specialist -- document management
and case administration $75 - $115
Consultant -- general consulting;
document and data review $125 - $210
Senior Consultant -- general consulting;
document and data review $225 - $250
Technology and Programming Consultant
-- KCC Case View maintenance and support $115 - $195
The firm will send copies of its monthly invoices to the United
States Trustee.
With its appointment as notice, claims and balloting agent,
Kurtzman:
-- is not and will not be employed by any federal or state
agency and will not seek any compensation from the
Government;
-- by accepting employment in the Debtors' cases, waives any
right to receive compensation from the Government;
-- is not an agent of the Government and is not acting on
behalf of the Government;
-- will not misrepresent any fact to the public; and
-- will not employ any past or present employees of the
Debtors for work involving the Chapter 11 cases.
Eric Kurtzman, chief executive officer of Kurtzman Carson
Consultants LLC, assures the Court that to the best of his
knowledge, the officers and employees of his firm:
(a) do not have any adverse connection with the Debtors, the
Debtors' creditors or any other party-in-interest or their
attorneys and accountants, the United States Trustee, or
any person employed by the office of the U.S. Trustee; and
(b) do not hold or represent an interest adverse to the
Debtors' estates.
Mr. Kurtzman attests that his firm is a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code, as
modified by Section 1107(b).
Prior to the Debtors' bankruptcy filing, Kurtzman performed
certain professional services for the Debtors. The Debtors
provided the firm with a $100,000 advance payment retainer. Mr.
Marchiando states the Debtors do not owe Kurtzman any amount for
services performed or expenses incurred prior to the Petition
Date.
Kurtzman's original Retention Agreement provided for limitations
of liability and indemnification. The Court, however, modified
the Retention Agreement to remove that provision.
A full-text copy of Kurtzman's Fee Structure is available for free
at http://ResearchArchives.com/t/s?17d6
Rochester Hills, Mich.-based DURA Automotive Systems, Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies, structural
door modules and exterior trim systems for the global automotive
industry. The company is also a supplier of similar products to
the recreation vehicle and specialty vehicle industries. DURA
sells its automotive products to North American, Japanese and
European original equipment manufacturers and other automotive
suppliers.
The Debtors filed for chapter 11 petition on October 30, 2006
(Bankr. District of Delaware Case No. 06-11202). Richard M.
Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq.,
and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead
counsel for the Debtors' bankruptcy proceedings. Mark D. Collins,
Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors'
co-counsel. Baker & McKenzie acts as the Debtors' special
counsel. Togut, Segal & Segal LLP is the Debtors' conflicts
counsel. Miller Buckfire & Co., LLC is the Debtors' investment
banker. Glass & Associates Inc., gives financial advice to the
Debtor. Kurtzman Carson Consultants LLC handles the notice,
claims and balloting for the Debtors and Brunswick Group LLC acts
as their Corporate Communications Consultants for the Debtors. As
of July 2, 2006, the Debtor had $1,993,178,000 in total assets and
$1,730,758,000 in total liabilities. (Dura Automotive Bankruptcy
News, Issue No. 4; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
DURA AUTOMOTIVE: Wants to Employ Deloitte & Touche as Auditors
--------------------------------------------------------------
DURA Automotive Systems, Inc. and its debtor affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for authority
to employ Deloitte & Touche LLP as independent auditors and
accountants, nunc pro tunc to Oct. 30, 2006.
Keith Marchiando, vice president and chief financial officer,
relates that Deloitte & Touche, an affiliate of Deloitte Tax LLP,
is a national professional services firm with hundreds of partners
and thousands of professional staff. The firm's experience in
auditing and accounting is widely recognized, and it regularly
provides services to large and complex business entities.
Deloitte & Touche also has extensive experience in delivering
auditing and accounting services in Chapter 11 cases.
Deloitte & Touche functioned as the Debtors' independent auditors
and accountants before the Debtors' filing for chapter 11
protection, Mr. Marchiando adds.
The firm has agreed to:
(a) audit the consolidated annual financial statements of the
Debtors and its subsidiaries for the fiscal years ended
December 31, 2006, and onwards;
(b) review the Debtors' interim financial information for each
quarter for the fiscal year ending December 31, 2006, and
onwards;
(c) render other audit and accounting services, including
assistance in connection with reports requested by the
Court, United States Trustee or parties-in-interest;
accounting advisory services during the course of
reorganization; and other similar requested assistance at
an hourly rate basis; and
(d) provide additional audit services, should the assumptions
underlying the fixed fee estimate cost not materialize.
Mr. Marchiando relates that as of the Petition Date, Deloitte &
Touche holds a minimal retainer of approximately $5,000, and
provides services upon a fixed fee between $3,430,000 and
$3,800,000.
For the additional services, Deloitte & Touche will bill:
Professionals Hourly Rates
------------- ------------
Partner, Principal, Director $460 - $650
Senior Manager $390 - $490
Manager $320 - $390
Senior Accountants $200 - $250
Staff Accountants $135 - $180
Paraprofessionals $60
The firm discloses that from time to time, certain Deloitte &
Touche Tohmatsu member firms will assist it in connection with its
ongoing audit services with approximately $15,000 in services that
will be included in Deloitte & Touche's fee applications. The DTT
Member Firms will be retained and paid by the applicable non-
filing Debtor affiliates.
The Debtors have also sought to retain Ernst & Young LLP as their
internal auditors and tax service providers. Deloitte & Touche
has advised the Debtors that it will make every effort to avoid
duplication of its work and that of Ernst & Young, and Deloitte
Tax.
Christopher A. Swanson, a partner of Deloitte & Touche, discloses
certain relationships with parties in connection with matters
unrelated to the Debtors' Chapter 11 cases:
-- the firm provides services to certain of the Debtors'
largest unsecured creditors, including its lenders GE
Capital Corp., Goldman Sachs, and Barclays Bank or their
affiliates; and
-- certain financial institutions that are prepetition lenders
of the Debtors, including AXA, Harris Bank, Comerica,
JPMorgan Chase, Wachovia Bank, Citigroup, Bank of America
and affiliates of GE are lenders to the firm.
Mr. Swanson assures the Court that the firm will not serve those
entities in the Debtors' Chapter 11 cases. He attests that his
firm is a disinterested person, as the term is defined in Section
101(14) of the Bankruptcy Code.
Rochester Hills, Mich.-based DURA Automotive Systems, Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies, structural
door modules and exterior trim systems for the global automotive
industry. The company is also a supplier of similar products to
the recreation vehicle and specialty vehicle industries. DURA
sells its automotive products to North American, Japanese and
European original equipment manufacturers and other automotive
suppliers.
The Debtors filed for chapter 11 petition on October 30, 2006
(Bankr. District of Delaware Case No. 06-11202). Richard M.
Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq.,
and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead
counsel for the Debtors' bankruptcy proceedings. Mark D. Collins,
Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors'
co-counsel. Baker & McKenzie acts as the Debtors' special
counsel. Togut, Segal & Segal LLP is the Debtors' conflicts
counsel. Miller Buckfire & Co., LLC is the Debtors' investment
banker. Glass & Associates Inc., gives financial advice to the
Debtor. Kurtzman Carson Consultants LLC handles the notice,
claims and balloting for the Debtors and Brunswick Group LLC acts
as their Corporate Communications Consultants for the Debtors. As
of July 2, 2006, the Debtor had $1,993,178,000 in total assets and
$1,730,758,000 in total liabilities. (Dura Automotive Bankruptcy
News, Issue No. 7; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
DURANGO GEORGIA: Liquidating Trustee Closes Paper Mill Sale
-----------------------------------------------------------
Bridge Associates, LLC, Liquidating Trustee of Durango Georgia
Paper Company, and LandMar Group, LLC, of Jacksonville, Florida,
jointly disclosed the closing of the sale of a 750-acre tract
located in St. Marys, Georgia, formerly operated as a paper mill
by the Durango Georgia Paper Estate, to LandMar Group's
subsidiary, North River, LLC.
At a hearing on Dec. 15, 2005, U.S. Bankruptcy Judge Lamar W.
Davis, Jr., approved the sale of the former Durango Paper Mill in
St. Marys, Georgia, held by the Bankruptcy Estate of Durango
Georgia Paper Company, for $36,450,000 to the LandMar Group, LLC.
The closing took place on Dec. 28, 2006. Bridge Associates, LLC,
calculates $51.7 million as the total recovery realized by the
estate on behalf of creditors from the sale of all assets offered
at the December 2005 auction, which included the sales of the
tract to LandMar as well as additional assets to other bidders.
LandMar intends to redevelop the former paper mill tract for
residential, commercial, and recreational uses.
"The closing of this transaction demonstrates what can be achieved
when the various parties in a bankruptcy are willing to take
creative and courageous action," Anthony Schnelling, Managing
Director of Bridge Associates, LLC, stated. "When we began this
process, it appeared that there was virtually no interest in the
assets of the former paper mill. The transaction that just closed
not only offers substantial recovery for the creditors of the
bankruptcy estate, but it also provides significant relief for the
former mill employees. This sale also represents a tremendous
opportunity for the local citizens of St. Marys, where the site of
an abandoned paper mill will be transformed into an exciting real
estate development and marina."
Mr. Schnelling also said that the successful outcome could not
have been achieved without the able leadership of Ward Stone, Jr.
of Stone and Baxter, LLP, the attorney for the unsecured
creditors, along with the day-to-day contribution made by Mike
Newsom of Bridge Associates. "Ward helped guide this process
through every step along the way. His counsel and commitment were
critical to the process of maximizing the recovery to the estate.
Mike's dedication and tireless devotion to the project played a
key role in the successful outcome."
"We are very excited and pleased that the transaction has closed
so that we can move forward with our plans to create a true
landmark property for St. Marys and the region," Edward E. Burr,
President and CEO of LandMar Group, LLC, stated. "Our focus now
is on securing the Tax Assisted District to help fund the
intensive clean up required of this former mill site."
About LandMar
Founded in 1987, LandMar Group LLC -- http://www.landmargroup.com/
-- develops a wide array of residential, commercial and mixed-use
offerings throughout the Southeast including Jacksonville,
Jacksonville Beach, Fernandina Beach, St. Augustine, Palm Coast,
New Smyrna Beach, Clermont, Tampa, Brooksville, Fort Myers, and
St. Marys, Georgia.
LandMar communities offer homesites, homes and condominiums in a
wide range of prices and feature a wealth of amenities including
several championship golf courses. The company also develops
luxury condominiums focused on high amenity areas on oceanfront,
Intracoastal Waterway and riverfront locations.
About Durango Georgia
Based in St. Mary's, Georgia, Durango Georgia Paper Company --
http://www.durangopaper.com/-- was a nationally recognized
bleached board and kraft paper producer in the U.S. offering
coast-to-coast and international service. On Oct. 29. 2002,
creditors filed an involuntary chapter 7 petition against Durango.
The Company filed for chapter 11 relief on Nov. 20, 2002 (Bankr.
S.D. Ga. Case No. 02-21669). George H. Mccallum, Esq., at Stone &
Baxter, LLP, Kate D. Strain, Esq., at Hunter, Maclean, Exley &
Dunn, PC, and Neil P. Olack, Esq., at Duane Morris LLP, represent
the Debtor in its restructuring efforts. Bridge Associates, LLC,
was appointed as Liquidating Trustee under the terms of a Plan of
Liquidation approved by creditors and confirmed by the Bankruptcy
Court in June 2004.
EYI INDUSTRIES: Inks ME2 Marketing Rights Agreement with Mach 3
---------------------------------------------------------------
EYI Industries Inc. signed a definitive agreement with Mach 3
Technologies Group, LLC in connection with the letter of intent
disclosed on Oct. 25, 2006 for the Philippines.
The agreement between EYI and Mach 3 provides exclusive individual
residential marketing rights for Mach 3's fuel performance product
ME2 in the Philippines for three years.
"We are excited to bring ME2 to the Philippines," EYI President &
CEO, Mr. Jay Sargeant comments. "Our partners from the
Philippines were just in our corporate offices for a week of
training and they are preparing themselves for their launch in
early 2007. Our partners and managers in the Philippines now have
the expertise and contacts to bring ME2 to their market."
About EYI
EYI Industries Inc. (OTCBB:EYII) -- http://www.eyicom.com/--
through our subsidiary Essentially Yours Industries, Inc., markets
products that promote health and well-being. Recently, EYI
launched a consumer product that reduces arsenic and other
contaminates to a negligible level from drinking water. The
portable water filtration product's name is Code Blue(tm) and is
exclusively provided to EYI. In addition, EYI sells dietary
supplements and personal care products.
Going Concern Doubt
Williams & Webster, P.S., in Spokane, Washington, raised
substantial doubt about EYI Industries, Inc.'s ability to continue
as a going concern after auditing the Company's consolidated
financial statements for the year ended Dec. 31, 2005. The
auditing firm pointed to the Company's significant losses from
operations, insufficient revenues, and working capital deficit.
FEDERAL MOGUL: Court Okays Killian as Special Insurance Counsel
---------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware signs a stipulated order authorizing
Federal-Mogul Corporation and its debtor affiliates to hire
Killian & Salisbury P.C. as special insurance counsel nunc pro
tunc to Sept. 18, 2006.
F-M Products has filed a complaint in the Superior Court of New
Jersey seeking (i) a declaration as to its coverage rights under
certain insurance policies issued in the 1960s, 1970s, and 1980s
to Studebaker-Worthington, Inc., and McGraw-Edison Company, and
(ii) damages for breach of contract and bad faith.
To prosecute the New Jersey state court coverage action, the
Debtors need to retain local counsel to act on their behalf in
New Jersey.
The insurers stipulating to the Court order include:
-- Ace Property & Casualty Insurance Company;
-- Century Indemnity Company;
-- Central National Insurance Company of Omaha;
-- Pacific Employers Insurance Company;
-- Insurance Company of North America;
-- OneBeacon America Insurance Company;
-- Sealon Insurance Company;
-- St. Paul Mercury Insurance Company;
-- Stonewall Insurance Company;
-- TIG Insurance Company;
-- United States Fire Insurance Company;
-- Allstate Insurance Company;
-- Allianz Versicherungs AG;
-- Allianz Global Risks U.S. Insurance Company;
-- Allianz Underwriters Insurance Company;
-- Westport Insurance Corporation;
-- Employers Reinsurance Corporation;
-- Travelers Casualty and Surety Company;
-- Continental Casualty Company;
-- Columbia Casualty Company;
-- Continental Insurance Company;
-- INSCO Limited;
-- Providence Washington Insurance Company;
-- Certain Underwriters at Lloyd's London;
-- Certain London Market Insurance Companies; and
-- Yosemite Insurance Company.
Judge Fitzgerald clarifies that nothing in the Court order will
constitute or be deemed to constitute a finding of fact or
conclusion of law as to any factual or legal assertion made by the
Debtors in their Application that could have any bearing on any
contested insurance coverage issue whatsoever, including, without
limitation:
(a) the question of whether New Jersey is an appropriate venue
for litigation of the parties' contested insurance
coverage issues;
(b) the question of whether Federal-Mogul Products, Inc.'s New
Jersey lawsuit should be permitted to proceed; or
(c) the Debtors' assertion that "New Jersey is the state with
the most substantial relationship to the relevant parties
and events during all of the years in issue."
The Court specifically retains the rights of Certain Insurers to
argue that F-M Products' New Jersey lawsuit ought to be dismissed
or stayed from on forum non conveniens grounds or any other
appropriate ground.
Killian & Salisbury will:
-- handle the filing and service of certain pleadings;
-- make certain appearances before the New Jersey court
overseeing the state court coverage action; and
-- provide certain advice on local court procedures and
related matters.
Gilbert Heintz & Randolph LLP currently serves as the Debtors'
principal insurance counsel. GHR, however, is based in
Washington, D.C., and cannot act as local counsel for the New
Jersey action. GHR will continue to act as primary insurance
counsel in directing the litigation.
Killian & Salisbury will coordinate its efforts with Gilbert
Heintz & Randolph LLP, the Debtors' current principal insurance
counsel, and other professionals retained by the Debtors to ensure
that its actions are not duplicative.
Eugene Killian, Esq., a partner at Killian & Salisbury, is
expected to be principally responsible for the engagement,
assisted by Ariana Vugrek, Esq., an associate at the firm; and one
of the firm's paraprofessionals.
Killian & Salisbury will bill:
Professional Hourly Rate
------------ -----------
Eugene Killian $300
Ariana Vugrek $185
A paraprofessional $85
The firm will also be reimbursed for all costs and expenses
incurred in connection with the representation.
Mr. Killian assures the Court that the members, counsel and
associates at his firm do not represent or hold any interest
materially adverse to the estate on the matters on which Killian &
Salisbury is to represent the Debtors.
Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion. The Company filed for
chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No.
01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and
Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura
Davis Jones Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub, P.C., represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $10.15 billion in assets and $8.86 billion
in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq.,
at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq.,
Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard
Firm represent the Official Committee of Unsecured Creditors.
(Federal-Mogul Bankruptcy News, Issue No. 122; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FEDERAL-MOGUL: Wants Court Okay on Lumbermens Settlement Pact
-------------------------------------------------------------
Federal-Mogul Corporation and its debtor affiliates ask the
Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court for
the District of Delaware to approve the Settlement Agreement with
Lumbermens Mutual Casualty Company, pursuant to which Lumbermens
agreed to pay Federal-Mogul Products, Inc. $5,800,000 in exchange
for a full and final settlement of all disputes between them
relating to:
(i) insurance coverage with respect to the applicable
products/completed operations hazards limits under the
Subject Policies;
(ii) insurance coverage for Asbestos Claims under the Subject
Policies; and
(iii) the Adversary Proceeding and the NJ Action.
James E. O'Neill, Esq., at Pachulski, Stang, Ziehl, Young, Jones
& Weintraub LLP, in Wilmington, Delaware, relates that Lumbermens
issued three liability insurance policies to Studebaker-
Worthington, Inc., a former corporate affiliate of Debtor F-M
Products.
F-M Products asserts that it is entitled to insurance coverage
under each of the Subject Policies for asbestos-related claims and
other claims, Mr. O'Neill notes.
F-M Products and Lumbermens, however, dispute their rights and
obligations with respect to insurance coverage for Asbestos Claims
under the Subject Policies, Mr. O'Neill says.
F-M Products and Lumbermens -- together with a number of other
parties, including numerous other insurers -- have been named as
defendants in a 2001 adversary proceeding commenced by Dresser
Industries, Inc. The action was later removed to the U.S.
District Court for the District of Delaware.
On Nov. 18, 2004, the Bankruptcy Court approved a Partitioning
Agreement between Dresser, F-M Products, and Cooper Industries,
Inc. The parties agreed that the unexhausted aggregate limits for
each of the insurance policies at issue in the Adversary
Proceeding will be divided whereby DII or Dresser will have 50% of
the unexhausted limits for each policy, and F-M Products and
Cooper will share the other 50%.
Subsequently, Dresser dismissed its claims against most of the
defendants in the Adversary Proceeding and is now in the process
of dismissing its remaining claims.
Certain of the Defendant Insurers have filed a request asking the
District Court presiding over the Adversary Proceeding to abstain
from conducting further proceedings in the case. The Insurers
argued that the case no longer involved any bankruptcy issues,
therefore mandatory abstention, or, in the alternative,
discretionary abstention, applies.
F-M Products has asked the District Court to refrain from
abstaining until after it has resolved certain matters that have
been fully briefed in that Court, Mr. O'Neill says.
Because New Jersey is the state with the most substantial
relationship to the relevant parties and events during all of the
years at issue, F-M Products has filed a complaint in the Superior
Court of New Jersey seeking a declaration as to its coverage
rights under the policies as well as damages for breach of
contract and bad faith.
As of October 30, 2006, no other state court actions pertaining to
F-M Products' coverage rights under policies issued by the
Defendant Insurers are pending, Mr. O'Neill informs Judge
Fitzgerald. Certain Insurers are seeking leave pursuant to
Section 362(d) to file a coverage action against F-M Products in
New York state court, which has not been ruled upon.
The Debtors and Lumbermens have negotiated to resolve the disputes
between them concerning insurance coverage and to further define
their rights and obligations under the Subject Policies.
The Lumbermens Settlement Agreement provides for, among other
things, mutual releases of certain claims under the Subject
Policies as well as a permanent withdrawal of all of Lumbermens'
claims, objections and appeals, if any, in the Debtors' Chapter 11
cases.
The Lumbermens Settlement Agreement does not affect other aspects
of the Adversary Proceeding or the NJ Action involving insurers
other than Lumbermens. In addition, the Lumbermens Settlement
Agreement provides only a partial release of claims under the
Subject Policies.
The Lumbermens Settlement Agreement is limited to claims related
to applicable products or completed operations hazards limits and
Asbestos Claims.
A full-text-copy of the Settlement Agreement and Release between
F-M Products, Inc., and Lumbermens is available for free at
http://ResearchArchives.com/t/s?17d8
Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion. The Company filed for
chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No.
01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and
Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura
Davis Jones Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub, P.C., represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $10.15 billion in assets and $8.86 billion
in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq.,
at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq.,
Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard
Firm represent the Official Committee of Unsecured Creditors.
(Federal-Mogul Bankruptcy News, Issue No. 119; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FINANCE AMERICA: S&P Cuts Rating on Class B2 Certs. & Places Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the class
B2 certificate from Finance America Mortgage Loan Trust 2004-1 and
placed it on CreditWatch with negative implications.
Concurrently, the rating on the class B1 certificate was also
placed on CreditWatch negative. In addition, the remaining ratings
from this transaction were affirmed.
The lowered rating and CreditWatch placements reflect realized
losses that have continuously depleted overcollateralization.
During the previous five remittance periods, monthly losses have
exceeded excess interest by approximately $190,000. The failure
of excess interest to cover monthly losses has resulted in an
overcollateralization deficiency of $1,718,980. As of the
December 2006 distribution date, overcollateralization was
approximately 48% below its target balance. Total delinquencies
represent 22.75% of the current pool balance, with 15.62%
categorized as seriously delinquent (90-plus-days, foreclosure,
and REO). Cumulative realized losses represent 1.26% of the
original pool balance.
Standard & Poor's will continue to closely monitor the performance
of this transaction. If losses continue to outpace excess spread,
further negative rating actions can be expected. Conversely, if
losses are covered by excess spread and overcollateralization
builds toward its target balance, S&P will affirm the ratings on
classes B1 and B2 and remove them from CreditWatch.
The affirmations reflect actual and projected credit support that
is sufficient to maintain the current ratings.
Credit support for this transaction is provided through a
combination of subordination, excess spread, and
overcollateralization. The collateral consists of 30-year, fixed-
and/or adjustable-rate subprime mortgage loans secured by first
liens on residential properties.
Rating Lowered and Placed on Creditwatch Negative
Finance America Mortgage Loan Trust 2004-1
Rating
------
Class To From
----- -- ----
B2 B/Watch Neg BB+
Rating Placed on Creditwatch Negative
Finance America Mortgage Loan Trust 2004-1
Rating
------
Class To From
----- -- ----
B1 BBB-/Watch Neg BBB-
Ratings Affirmed
Finance America Mortgage Loan Trust 2004-1
Class Rating
----- ------
1A1, 1A2, ASIO, M1 AAA
M-2 AA+
M-3 AA
M-4 AA-
M-5 A+
M-6 A
M-7 A-
M-8 BBB+
FIRST CONSUMER: Fitch Retains Negative Watch on $27.4 Mil. Notes
----------------------------------------------------------------
Earlier this year, Fitch placed the two outstanding classes of
First Consumer Credit Card Master Note Trust Series 2001-A on
Rating Watch. At this time, they will remain on Rating Watch and
are expected to be resolved by January 31, 2007.
Fitch has these issues on Rating Watch:
-- $27,484,729.47 class B floating-rate asset-backed notes
'CCC' on Rating Watch Negative;
-- $36,000,000 class C floating-rate asset-backed notes 'B-'
on Rating Watch Positive.
The Rating Watch Negative reflects the undercollateralization of
class B, as there is only about $11 million in collateral
currently supporting the class B notes. Class B had an initial
principal outstanding amount of $63 million, and the legal final
maturity date is Sept. 15, 2008.
Class C noteholders benefit from a dedicated spread account that
is fully funded with a balance in excess of $36 million,
essentially providing 100% credit enhancement. The spread account
is available to cover current interest and principal shortfalls at
maturity for class C only. Although the spread account was fully
funded even prior to the early amortization in 2003, Fitch had
been concerned with the trust's ability to make timely interest
payments to the noteholders. However, since this is the last
series outstanding in the trust, it is currently allocated 100% of
principal collections and 26.15% of finance charges and uncovered
chargeoffs. As a result, the Rating Watch Positive indicates an
increased probability of timely interest payments and ultimate
repayment of the bond.
The FCCMNT was operated by First Consumers National Bank, a
national banking association acquired by Spiegel in 1990. The
receivables in the portfolio arose under MasterCard and Visa
credit card accounts. In March 2003 several negative events
transpired: the trust entered early amortization after the base
rate trigger was breached, the Office of the Comptroller of the
Currency issued a cease and desist order, and customers' charging
privileges were revoked. In June 2003, servicing was transferred
to First National Bank of Omaha and the servicing fee was
increased to 4.35%.
FLYI INC: Wants Plan Solicitation Period Extended Until April 30
----------------------------------------------------------------
FLYi Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court
for the District of Delaware to further extend their exclusive
period to solicit acceptances of a Chapter 11 plan from Dec. 29,
2006, through and including April 30, 2007.
The Official Committee of Unsecured Creditors in the Debtors'
Chapter 11 cases does not oppose the requested extension.
M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, relates that the Debtors filed their
plan of liquidation on August 15, 2006, however, certain complex
creditor negotiations and related discovery issues have delayed
the confirmation process. The Creditors Committee has indicated
that it fully supports the Plan.
The disclosure statement accompanying the Plan was approved on
November 21, 2006, with the confirmation hearing scheduled on
March 12, 2007. The Debtors are now in the Plan solicitation
process, Mr. Cleary informs the Court. The voting deadline for
the Plan is January 29, 2007, and the objection deadline for the
Plan is February 12, 2007.
The Debtors need an extension of the Exclusive Solicitation
Period to complete the solicitation process and seek confirmation
for their Plan. They request the extension out of an abundance
of caution, Mr. Cleary tells the Court.
The requested extension will not result in delay of the Plan
process; rather, it will simply allow the completion of process
as scheduled, consistent with the Congressional intent underlying
Section 1121 of the Bankruptcy Code, Mr. Cleary says. The
extension will also not prejudice the legitimate interests of any
creditor, he assures the Court.
The Court will convene a hearing on January 23, 2007 to consider
the Debtors' request. By application of Local Bankruptcy Rule
9006-2 for the District of Delaware, the Exclusive Solicitation
Period is automatically extended until the Court rules on the
equest.
Headquartered in Dulles, Virginia, FLYi Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport. The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017). Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts. Brett H. Miller, Esq., at Otterbourg,
Steindler, Houston & Rosen, P.C., represents the Official
Committee of Unsecured Creditors. As of Sept. 30, 2005, the
Debtors listed assets totaling $378,500,000 and debts totaling
$455,400,000. (FLYi Bankruptcy News, Issue No. 31; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FLYI INC: J. Elassaad Can Liquidate Claims in Penn. District Court
------------------------------------------------------------------
The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware approves a stipulation between the FLYi Inc.,
and its debtor-affiliates and Joseph Elassaad.
At the parties' behest, the Court modifies the automatic stay
solely for the purpose of permitting Mr. Elassaad to liquidate
his claims against the Debtors before the U.S. District Court for
the Eastern District of Pennsylvania and enforce judgment against
applicable liability insurance.
Mr. Elassaad will seek recovery with respect to his claims solely
from applicable and collectable insurance, and waive his right to
recover from the Debtors and their estates any settlement or
judgment entered in the Elassaad Litigation.
Mr. Elassaad releases and discharges the Debtors and their
estates from all claims and causes of action relating to the
Litigation.
Mr. Elassaad's PI Action
Mr. Elassaad asked the Bankruptcy Court to modify the automatic
stay imposed under Section 362 of the Bankruptcy Code to allow
him to prosecute in Pennsylvania a personal injury action against
the Debtors.
Mr. Elassaad relates that on February 9, 2004, he suffered
damages, including severe pain and permanent bodily injuries,
when he fell while exiting a Delta Connection commuter at the
Philadelphia International Airport.
Mr. Elassaad initiated his action for personal injuries against
Independence Air, Inc., and Delta Air Lines, Inc., in the Court
of Common Pleas of Philadelphia County, Pennsylvania, on Feb. 3,
2005. Subsequently, he filed a complaint alleging negligence on
the part of Independence Air and Delta.
On May 18, 2005, Independence Air and Delta removed the Action to
the United States District Court for the Eastern District of
Pennsylvania.
According to Daniel K. Hogan, Esq., at The Hogan Firm, in
Wilmington, Delaware, relates that the Delta Connection was
determined to be solely operated by Atlantic Coast Airlines,
Inc., which later changed its name to Independence Air. Thus,
Delta was voluntarily dismissed from the Action.
Mr. Hogan states that the Federal Court Action has been stayed as
of the Petition Date.
Mr. Hogan asserts that it would be prohibitively expensive and
inconvenient for Mr. Elassaad to proceed to trial before the
Bankruptcy Court, as his attorney in the Action resides in
Pennsylvania and is licensed only in that state. Certain fact
witnesses are also residents of Pennsylvania.
Mr. Hogan contends that any recovery by Mr. Elassaad is fully
covered by the Debtors' General Liability Insurance Policy issued
to AIG Insurance Company. That recovery would not impair the
Debtors' estate or have an adverse effect against creditors, Mr.
Hogan maintains.
"[Mr. Elassaad's] right to petition for redress of his grievances
would not be adequately protected if the stay and injunction is
to remain in full force and effect, in that Debtors will not be
made to answer for their negligent acts," Mr. Hogan tells Judge
Walrath.
Headquartered in Dulles, Virginia, FLYi Inc., aka Atlantic Coast
Airlines Holdings, Inc. -- http://www.flyi.com/-- is the parent
of Independence Air Inc., a small airline based at Washington
Dulles International Airport. The Debtor and its six affiliates
filed for chapter 11 protection on Nov. 7, 2005 (Bankr. D. Del.
Case Nos. 05-20011 through 05-20017). Brendan Linehan Shannon,
Esq., M. Blake Cleary, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts. Brett H. Miller, Esq., at Otterbourg,
Steindler, Houston & Rosen, P.C., represents the Official
Committee of Unsecured Creditors. As of Sept. 30, 2005, the
Debtors listed assets totaling $378,500,000 and debts totaling
$455,400,000. (FLYi Bankruptcy News, Issue No. 31; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
GLOBAL POWER: Wants Until April 26 to Decide on Leases
------------------------------------------------------
Global Power Equipment Group and its debtor-affiliates ask
the U.S Bankruptcy Court for the District of Delaware to further
extend, until April 26, 2007, the period within which it can
assume, assume or assign, or reject unexpired leases of
nonresidential real property.
The Debtors tells the Court that they have five unexpired
leases of nonresidential real property, including, the Debtors'
headquarters in Tulsa, Oklahoma; two of Williams Group facilities
in Stone Mountain, Georgia and Lakeland, Florida; and Branden
Group facilities in Tulsa, Oklahoma.
The Debtors assure the Court that any lessor will not be harmed
as a result of the requested extension, since they will continue
to comply with their postpetition obligations.
Headquartered in Tulsa, Oklahoma, Global Power Equipment Group
Inc. aka GEEG Inc. -- http://www.globalpower.com/-- provides
power generation equipment and maintenance services for its
customers in the domestic and international energy, power and
infrastructure and service industries. The Company designs,
engineers and manufactures a range of heat recovery and auxiliary
equipment primarily used to enhance the efficiency and facilitate
the operation of gas turbine power plants as well as for other
industrial and power-related applications. The Company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The Company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A., represent
the Debtors. The Official Committee of Unsecured Creditors
appointed in the Debtors' cases has selected Landis Rath & Cobb
LLP as its counsel. As of Sept. 30, 2005, the Debtors reported
total assets of $381,131,000 and total debts of $123,221,000. The
Debtors' exclusive period to filed a chapter 11 plan expires on
Jan. 26, 2007.
GOODYEAR TIRE: Inks New Labor Contract with Steelworkers Union
--------------------------------------------------------------
The Goodyear Tire & Rubber Company and the United Steelworkers
union have reached tentative agreement on a new master contract
covering about 12,600 employees at 12 tire and engineered products
plants in the United States. The USW is expected to schedule
ratification votes at all plants in the coming days.
The previous three-year labor agreement expired July 22, 2006.
The Goodyear USW members have been on strike since October 5,
2006.
The 12 master contract plants covered by the tentative agreement
are:
* Akron, Ohio;
* Buffalo, New York;
* Danville, Virginia;
* Fayetteville, North Carolina;
* Gadsden, Alabama;
* Lincoln, Nebraska;
* Marysville, Ohio;
* St. Marys, Ohio;
* Sun Prairie, Wisconsin;
* Topeka, Kansas;
* Tyler, Texas; and
* Union City, Tennessee.
The company says that the tentative agreement with USW supports
its strategy to significantly reduce costs and improve
competitiveness in its North American operations.
"Our goal was always to reach a fair agreement that improves our
ability to compete and win with customers. This agreement would
accomplish that goal," said Robert J. Keegan, chairman and chief
executive officer.
The tentative agreement, gives Goodyear the ability to reduce
excess high-cost manufacturing capacity, reduce legacy costs,
improve productivity and reduce labor costs consistent with the
four point cost reduction plan that was announced to investors in
2005. The tentative agreement:
* Secures retiree medical benefits through an independently
administered Voluntary Employees' Beneficiary Association to
be launched with an up front $1 billion contribution from
Goodyear to consist of $700 million in cash and up to
$300 million in additional cash or common stock at the
company's option. Subject to court and regulatory
approvals, the VEBA would assume full responsibility for
providing retiree medical benefits to all present and future
Goodyear USW retirees;
* Consistent with Goodyear's previously announced plans to
exit certain segments of the private label tire business,
provides for the closing of the Tyler, Texas, facility after
Dec. 31, 2007;
* Delivers substantial improvements in labor costs and
productivity through redesign of incentive systems and
immediate implementation of market-based wage and benefit
levels for all new hires; and
* Improves job security and provides capital investments in
USW plants of at least $550 million over the life of the
agreement.
Goodyear is one of the world's largest tire companies. The
company manufactures tires, engineered rubber products and
chemicals in more than 100 facilities in 29 countries around the
world. Goodyear employs about 80,000 people worldwide.
GOODYEAR TIRE: New Labor Contract Cues S&P to Remove Neg. Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit and other ratings on Goodyear Tire & Rubber Co. and removed
them from CreditWatch where they were placed with negative
implications on Oct. 16, 2006, as a result of the labor dispute at
several of the company's North American plants.
The affirmation follows the announcement that Goodyear and the
United Steel Workers Union, representing about 12,600 employees at
12 plants in the U.S. and Canada, have reached an agreement on a
new contract and union members have ratified the agreement. The
outlook is stable.
Pro forma for $1 billion of new debt sold in the fourth quarter --
partly to refinance $515 million of debt coming due in the next
six months, some of which was repaid in December -- Goodyear has
total debt (including the present value of operating leases and
underfunded employee benefit liabilities) of about $12 billion.
The new contract should enable Goodyear to achieve substantial
cost savings over the three-year contract term. The company
estimates that compared with 2006 prestrike levels, savings are
expected to total $70 million in 2007, $240 million in 2008, and
$300 million in 2009. These savings are comprised of capacity-
related savings, reduced legacy costs, and savings from increased
productivity.
Significant terms of the new three-year contract include:
-- The elimination (subject to court and regulatory approval)
of Goodyear's responsibility for all current and future
retiree health care liabilities for the company's USW
workforce in return for the creation of a VEBA trust with
$1 billion in initial funding, a portion of which could be
funded with Goodyear's common equity. Resulting OPEB
expense savings are estimated at $110 million and cash
savings at $145 million annually compared with 2006.
Goodyear's total unfunded OPEB liability was $2.6 billion
at the end of 2005, of which about half was the USW OPEB
liability.
-- The closure of the Tyler, Texas-based plant after the end
of 2007. This closure will eliminate 9 million units of
higher-cost capacity and save an estimated $50 million
annually.
-- Lower-cost wages and benefits for new hires during the
first three years of employment. The level of savings will
depend partly on the attrition rate of the existing
workforce.
GREENWICH CAPITAL: Fitch Rates $17.7 Million Class L Certs. at BB+
------------------------------------------------------------------
Fitch rates Greenwich Capital Commercial Funding Corporation,
Series 2006-FL4, commercial mortgage pass-through certificates as:
-- $572,069,000 class A-1 'AAA';
-- $230,389,000 class A-2 'AAA';
-- $986,326,845 class X-1 'AAA';
-- $35,378,000 class B 'AA+';
-- $30,713,000 class C 'AA';
-- $17,970,000 class D 'AA-';
-- $16,734,000 class E 'A+';
-- $11,291,000 class F 'A';
-- $15,004,000 class G 'A-';
-- $17,589,000 class H 'BBB+';
-- $14,191,000 class J 'BBB';
-- $7,229,000 class K 'BBB-';
-- $17,769,845 class L 'BB+';
These are rated by Fitch and are nonpooled trust assets (rakes):
-- $2,150,848 class N-MET 'BBB';
-- $6,596,721 class O-MET 'BBB-';
-- $997,740 class N-LAX 'BBB-';
-- $2,257,227 class N-NZH 'BBB-';
-- $1,598,637 class N-NW 'A-';
-- $899,005 class O-NW 'BBB+';
-- $961,005 class P-NW 'BBB';
-- $1,169,823 class Q-NW 'BBB-';
-- $770,025 class N-E161 'BBB-';
-- $894,087 class N-SCR 'BBB';
-- $1,378,484 class O-SCR 'BBB-';
-- $993,129 class N-WYN 'BBB-';
-- $1,381,234 class N-2600 'AA-';
-- $1,966,176 class O-2600 'A-';
-- $1,303,037 class P-2600 'BBB';
-- $1,713,347 class Q-2600 'BBB-';
-- $2,259,615 class N-HAP 'A-';
-- $1,138,994 class O-HAP 'BBB';
-- $1,307,734 class P-HAP 'BBB-';
-- $1,107,623 class N-CPH 'AA-';
-- $1,907,473 class O-CPH 'A-';
-- $803,146 class P-CPH 'BBB+';
-- $803,146 class Q-CPH 'BBB';
-- $1,355,309 class S-CPH 'BBB-';
-- $583,585 class N-LJS 'BBB-';
-- $1,070,336 class N-LDC 'A-';
-- $908,461 class O-LDC 'BBB';
-- $838,579 class P-LDC 'BBB-';
-- $1,115,955 class N-444 'BBB';
-- $1,072,762 class O-444 'BBB-'.
All classes are privately placed pursuant to rule 144A of the
Securities Act of 1933. The certificates represent beneficial
ownership interest in the trust, primary assets of which are 32
floating rate loans having an aggregate principal balance of
approximately $986,326,845, as of the cutoff date.
GSR MORTGAGE: Fitch Rates $1.07 Million Certificates at BB
----------------------------------------------------------
Fitch rates GSR Mortgage Loan Trust, series 2006-10F, residential
mortgage pass-through certificates as:
-- $411,496,000 classes 1A-1, 2A-1, 3A-1, 4A-1 through 4A-3,
5A-1, 6A-1, and A-X (senior certificates) 'AAA';
-- $4,717,000 class M-1 'AA+';
-- $5,358,000 class B-1 'AA';
-- $2,786,000 class B-2 'A';
-- $1,500,000 class B-3 'BBB';
-- $1,071,000 class B-4 'BB';
-- $642,000 class B-5 'B.'
The 'AAA' rating on the senior certificates reflects the 4.00%
subordination provided by the 1.10% class M-1, 1.25% class B-1,
0.65% class B-2, 0.35% class B-3, 0.25% privately offered class B-
4, 0.15% privately offered class B-5, and 0.25% privately offered
class B-6. Class B-6 is not rated by Fitch. The ratings also
reflect the quality of the underlying collateral, the strength of
the legal and financial structures, and the master servicing
capabilities of Wells Fargo Bank, N.A., which is rated 'RMS1' by
Fitch.
As of the cut-off date, Dec. 1, 2006, the pool of loans consists
of 843 fixed-rate mortgage loans, which have 20-year through 30-
year amortization terms, with an approximate balance of
$428,644,413. The mortgage pool has an average unpaid principal
balance of $508,475 and a weighted average FICO score of 740. The
weighted average amortized current loan-to-value (CLTV) ratio is
71.10%. Rate/Term and cash-out refinances represent 17.17% and
35.81%, respectively, of the mortgage loans. The states that
represent the largest geographic concentration of mortgaged
properties are California (44.15%), New York (6.91%), New Jersey
(4.32%), and Maryland (4.23%). All other states comprise fewer
than 5% of properties in the pool.
None of the mortgage loans are 'high cost' loans as defined under
any local, state, or federal laws.
GS Mortgage Securities Corp. purchased the mortgage loans from
each seller and deposited the loans in the trust, which issued the
certificates, representing undivided and beneficial ownership in
the trust. For federal income tax purposes, the securities
administrator will cause multiple real estate mortgage investment
conduit elections to be made for the trust. Wells Fargo Bank,
N.A. will act as securities administrator and U.S. Bank, N.A. will
serve as the trustee.
HOMESTAR MORTGAGE: Moody's Cuts Rating on Class M-5 Certs. to B1
----------------------------------------------------------------
Moody's Investors Service has downgraded two classes of
certificates from one of Homestar Mortgage Acceptance
Corporation's deals from 2004 and places one class of certificates
on watch for possible downgrade on a separate deal in 2004. The
deals are backed by Homestar originated collateral consisting of
primarily Alt-A loans, with a small percentage of subprime loans.
The actions were based on the deteriorating credit enhancement.
While the collateral is performing better than expected, the
overcollateralization has been falling significantly below its
target as a result of lower than expected excess spread levels.
Complete rating action is as follows:
Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass-
Through Certificates, Series 2004-2
Downgrade:
Class M-4, downgraded to Baa3, previously Baa1.
Class M-5, downgraded to B1, previously Baa2.
Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass-
Through Certificates, Series 2004-3
Review for possible downgrade:
Class M-5, current rating Baa2.
LENOX GROUP: Subsidiary Closes Sale of Pomona Factory to BTR
------------------------------------------------------------
Lenox Group Inc.'s subsidiary, Lenox Incorporated, closed on the
sale of its factory in Pomona, New Jersey to BTR Capital Fund II
LLC on Dec. 22, 2006.
Lenox Incorporated received net proceeds of $6,680,244.04, which
have been applied to pay down outstanding debt under its Term Loan
Credit Agreement.
As reported in the Troubled Company Reporter on Nov. 30, 2006
Lenox, Incorporated entered into an agreement of sale with BTR
Capital for the sale of its factory in Pomona, New Jersey for
$7 million.
Lenox Incorporated has leased back four spaces at the Pomona
property to continue various operations. The retail lease
consists of 31,500 square feet at a rent of $3.8175 per square
foot plus a pro rata share of real estate taxes and maintenance.
The initial term of the retail lease expires on Dec. 31, 2011.
Lenox Incorporated has also leased back on a six month basis, with
two six month renewal terms, 55,000 square feet for the
manufacturing of sterling silver products, 19,700 square feet for
its technical center and 14,000 square feet for customer service
offices. The rent for the three spaces is $3.50 per square foot
plus a pro rata share of real estate taxes and maintenance.
Based in Eden Prarie, Minnesota, Lenox Group Inc (NYSE: LNX) was
formed on Sept. 1, 2005, when Department 56, Inc., a designer,
wholesaler and retailer of collectibles and giftware products
purchased Lenox, Inc., a designer, manufacturer and marketer of
fine china, dinnerware, silverware, crystal and giftware products.
The Company sells its products through wholesale customers who
operate gift, specialty and department store locations in the
United States and Canada, Company-operated retail stores, and
direct-to-the-consumer through catalogs, direct mail, and the
Internet.
* * *
As reported in the Troubled Company Reporter on Nov. 14, 2006,
Moody's Investors Service lowered Lenox Group Inc.'s Corporate
Family Rating to B2 from B1. The rating outlook remains negative.
LEVITZ HOME: NY Court Dismisses Subsidiaries' Chapter 11 Cases
--------------------------------------------------------------
The Honorable Burton R. Lifland of the U.S. Bankruptcy Court for
the Southern District of New York dismissed the Chapter 11 cases
of six non-operating Levitz Home Furnishings, Inc.'s subsidiaries:
Debtor Case No.
------ --------
Levitz Furniture Company of Delaware, Inc. 05-45211
John M. Smyth Company 05-45207
Levitz Shopping Service, Inc. 05-45200
Seaman Furniture Company of Union Square 05-45217
Paralax Development Industries, Inc. 05-45143
RHM, Inc. 05-45204
The Dissolved Debtors are relieved from any further obligations
with respect their Chapter 11 cases, Judge Lifland says.
The Court directed the Dissolved Debtors, through Walker,
Truesdell & Associates, Inc., their Wind-Down Officer, or PLVTZ,
LLC, to pay all of their outstanding quarterly U.S. Trustee fees.
About Levitz Home Furnishings
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- retails furniture in the United
States with 121 locations in major metropolitan areas principally
the Northeast and on the West Coast of the United States. The
Company and its 12 affiliates filed for chapter 11 protection on
Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case No. 05-45189). David G.
Heiman, Esq., and Richard Engman, Esq., at Jones Day, represent
the Debtors in their restructuring efforts. When the Debtors
filed for protection from their creditors, they reported
$245 million in assets and $456 million in debts. Jay R. Indyke,
Esq., at Kronish Lieb Weiner & Hellman LLP represents the Official
Committee of Unsecured Creditors. Levitz sold substantially all
of its assets to Prentice Capital on Dec. 19, 2005. (Levitz
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
MAC-GRAY CORP: Inks Amended & Restated Credit Pact with Lenders
---------------------------------------------------------------
In a regulatory filing with the U.S. Securities and Exchange
Commission, Mac-Gray Corporation disclosed that on Dec. 21, 2006,
along with its subsidiaries, Mac-Gray Services, Inc. and Intirion
Corporation, entered into an Amended and Restated Credit
Agreement, with:
* JPMorgan Chase Bank, N.A., as administrative agent;
* J.P. Morgan Securities Inc., as sole bookrunner and sole
lead arranger;
* KeyBank National Association, as syndication agent;
* HSBC Bank USA, N.A., Wachovia Bank National Association and
Bank North, N.A., as co-documentation agents; and
* the lenders party.
The Amended Credit Agreement provides for a revolving credit
facility in the amount of $65,000,000, with the option, subject to
customary terms and conditions, to increase the line up to
$100,000,000 over the life of the facility, with a maturity date
of December 29, 2011. The Amended Credit Agreement amends the
Company's prior credit agreement, which provided for a
$120,000,000 revolving credit facility maturing on Jan. 10, 2010.
The Amended Credit Agreement also amends the Prior Credit
Agreement to reduce the interest rate on outstanding borrowings,
reduce the undrawn commitment fee and modify certain covenants.
With the exception of these changes, the security, representations
and warranties, covenants and events of default have not changed
from the Prior Credit Agreement.
Borrowings outstanding under the Amended Credit Agreement bear
interest at a fluctuating rate equal to:
(i) in the case of Eurodollar rate loans, the LIBOR rate
(adjusted for statutory reserves) plus an applicable
percentage, ranging from 1.00% to 1.50% (initially 1.25%),
determined by reference to the company's funded debt
ratio, or
(ii) in the case of alternate base rate loans and swing line
loans, the higher of:
(a) the federal funds rate plus 0.50% or
(b) the annual rate of interest announced by JPMorgan
Chase Bank, N.A. as its "prime rate," in each case,
plus an applicable percentage, ranging from zero to
0.50% (initially .25%), determined by reference to the
company's funded debt ratio.
The Company will pay a commitment fee equal to a percentage of the
average daily-unused portion of the revolver under the Amended
Credit Agreement. This percentage, initially 0.275%, will be
determined quarterly by reference to the Company's funded debt
ratio and will range between 0.25% and 0.30%.
The Company used approximately $25,000,000 of the revolver under
the Amended Credit Agreement to repay the outstanding obligations
under the Prior Credit Agreement and to pay fees expenses relating
to the Amended Credit Agreement.
Certain of the lenders and agents under the Amended Credit
Agreement and their respective affiliates have performed, and may
in the future perform, various commercial banking, investment
banking and other financial advisory services for the Company and
its subsidiaries for which they have received, and will receive,
customary fees and expenses.
A full-text copy of the Amended and Restated Credit Agreement,
dated as of Dec. 21, 2006, may be viewed at no charge at:
http://ResearchArchives.com/t/s?17e3
"We are pleased with the new terms of our credit facility and
appreciate the support of our bank syndicate during this process,
particularly our lead bank, J.P. Morgan," said Michael J. Shea,
Mac-Gray's chief financial officer. "The agreement enables us to
take advantage of the continued strengthening of the Company since
January 2005 when the original facility was written, as well as a
favorable interest rate environment to reduce our expenses going
forward. We expect this agreement to save us approximately
$450,000 in interest expense over the next twelve months. At
the same time, it maintains the financial flexibility we need to
fund our internal growth initiatives and continue to make
acquisitions that complement our business as we have done
throughout 2006. The expansion feature enables us to increase the
facility to $100 million for larger acquisition opportunities."
The company expects the unused portion of the new credit facility
to be approximately $40 million at year-end 2006. In 2006, Mac-
Gray successfully completed seven acquisitions at a total cost of
$19 million, and spent approximately $30 million in new and
renegotiated contracts in the laundry facilities management
business.
About Mac-Gray
Mac-Gray Corporation (NYSE: TUC) -- http://www.macgray.com/--
provides card-and coin-operated laundry facilities management
services and energy-efficient MicroFridge(R) appliances to multi-
unit housing locations such as apartment buildings, college and
university residence halls, condominiums and public housing
complexes. Mac-Gray also sells, services and leases commercial
laundry equipment to commercial laundromats and institutions
through its product sales division. Mac-Gray serves approximately
63,000 multi-housing laundry rooms located in 40 states and the
District of Columbia.
* * *
As reported in the Troubled Company Reporter on Dec. 7, 2006,
Standard & Poor's Ratings Services revised its outlook on Mac-Gray
Corp. to negative from stable. At the same time, existing ratings
on Mac-Gray, including its 'BB' corporate credit rating, were
affirmed.
MELO BIOTECH: Sells Canadian Computer Business to MIAD Information
------------------------------------------------------------------
Melo Biotechnology Holdings Inc., fka MIAD Systems Ltd., entered
into an asset sale, purchase and transfer agreement with MIAD
Information Systems Ltd., a Canadian corporation.
The majority shareholder of MIAD Information, Michael Green, is
the president and director of the MIAD Systems.
Under the Agreement, the company has agreed to sell to MIAD
Information, and MIAD Information has agreed to purchase, all of
the rights, properties, and assets used in the conduct of the
company's computer distribution and custom assembled personal
computer system business located exclusively in Ontario, Canada.
The transaction does not relate to or affect any of the company's
other business operations. As consideration for the purchase of
the Computer Business, MIAD Information will assume all
liabilities associated with the company's Computer Business.
Under the terms of the Agreement, the company will retain no
liability for any aspect of the company's Computer Business.
Additionally, MIAD Information has agreed to indemnify the company
for any potential liability that may arise out of the sale of the
Computer Business.
Headquartered in Markham, Ontario, Melo Biotechnology Holdings
Inc. fka MIAD Systems Ltd. -- http://www.miad.com/-- supplies
business computer systems and provides computer maintenance,
installation and networking services to major clients primarily
engaged in the corporate, institutional, municipal, utilities and
education fields.
M.L. Strategic Limited is a British Virgin Islands corporation and
is the owner of a majority of the issued and outstanding shares of
the common stock of Melo Biotechnology.
Miad Systems Ltd.'s interim balance sheet, as of June 30, 2006,
showed total assets of CDN$1,886,059 and total liabilities of
CDN$2,306,443, resulting in a total stockholders' deficit of
CDN$420,384.
NEXSTAR BROADCASTING: Completes $56 Mil. Acquisition of WTAJ-TV
---------------------------------------------------------------
Nexstar Broadcasting Group Inc. completed the purchase of the
assets of WTAJ-TV, a CBS affiliate serving the Johnstown/Altoona,
Pennsylvania market for $56 million from Television Station Group
Holdings, LLC, which is primarily owned by Boston Ventures and
Alta Communications.
As part of the purchase consideration, Nexstar Broadcasting also
acquired the license and certain assets and contracts of WLYH-TV,
a CW affiliate serving the Harrisburg/Lancaster/Lebanon/York,
Pennsylvania market, whereby another broadcaster now operates the
station under a "grandfathered" Time Brokerage Agreement that
extends until 2015.
"The acquisition of WTAJ-TV and the WLYH-TV time brokerage
agreement were completed at a purchase price multiple of less than
8.5 times their pro forma 2006 EBITDA and are immediately
accretive to the Company on a pro-forma basis" Nexstar
Broadcasting Group President and CEO, Perry A. Sook commented.
Nexstar funded the acquisition through borrowings under its senior
credit facility. Reflecting the completion of the transaction, the
Company's total leverage of outstanding debt
to EBITDA at the operating company is approximately 6x at
Dec. 31, 2006.
"The transaction is a promising opportunity for us as the station
is top ranked in the market in terms of audience share and
billings, its local news is #1 in every daypart in which it airs,
the station broadcasts to the healthy State College market.
Additionally, our negotiated retransmission agreements are being
overlaid in this market and will contribute to operating
improvements."
About Nexstar Broadcasting
Nexstar Broadcasting Group Inc. (Nasdaq: NXST) owns, operates,
programs, or provides sales and other services to 47 television
stations in 27 markets in the states of Illinois, Indiana,
Maryland, Missouri, Montana, Texas, Pennsylvania, Louisiana,
Arkansas, Alabama and New York. Nexstar's television station
group includes affiliates of NBC, CBS, ABC, FOX and MyNetworkTV,
and reaches approximately 8% of all U.S. television households.
* * *
Nexstar Broadcasting Group Inc.'s balance sheet at Sept. 30, 2006,
showed total assets of $679 million and total liabilities of
$757 million, resulting in a total stockholders' deficit of
$78 million.
OWNIT MORTGAGE: Files for Bankruptcy Protection in California
-------------------------------------------------------------
Ownit Mortgage Solutions Inc. has filed a voluntary chapter 11
petition with the U.S. Bankruptcy Court for the Central District
of California in San Fernando Valley, The Associated Press
reports.
AP says that Merrill Lynch LP Holdings Inc., the company's largest
unsecured creditor, holds an estimated $93 million claim and owns
20% in Ownit Mortgage's stake.
Among other creditors are Terwin Advisors LLC, which is owed
$19 million, and Credit Suisse First Boston with $12.7 million
claim, AP adds.
AP relates that the company's bankruptcy filing didn't contain an
explanation why it filed for chapter 11 protection. The company
representatives were unavailable for comment at that time.
The Los Angeles Times reports that the company's bankruptcy
petition was a reply to lawsuits filed by two creditors.
Ownit Mortgage Solutions Inc., a subprime mortgage lender,
specializes in making loans to borrowers with poor credit or
limited incomes. The company listed assets between $1 million to
$100 million and more than $100 million in debts.
REFCO INC: Equity Committee Wins $1.2 Million in Court Battle
-------------------------------------------------------------
The Hon. Robert Drain of the U.S. Bankruptcy Court for the
Southern District of New York in Manhattan approved the request of
Refco Inc. and its debtor-affiliates' Ad Hoc Equity Committee to
collect $1.2 million in legal fees and expenses from the company,
The Associated Press reports.
Owing about 30% of the company's stock, the committee includes:
-- King Street Capital Management LLC;
-- QVT Financial LP;
-- JMB Capital Partners LP;
-- Mason Capital Management;
-- Smith Management LLC; and
-- Triage Management LLC
According to AP, the reimbursement contains $1.15 million in
professional fees, $132,032 in expert-witness expenses and
assorted other fees accrued during a legal action in which the
hedge funds won the right to 3% to 15% of two trusts in the
Debtors' cases. The two trusts were the Litigation Trust and the
Private Action Trust.
As published in the Troubled Company Reporter, the Chapter 11 plan
of the Debtor and certain of its Direct and Indirect Subsidiaries,
including Refco Capital Markets, Ltd. and Refco F/X Associates,
LLC, became effective on Dec. 26, 2007. The effective date of the
plan now permits the companies to complete an expeditious orderly
wind-up of their businesses.
The Equity Committee reportedly said that it deserved for
reimbursement because it helped secure for most Refco stockholders
the right to receive proceeds of the two trusts.
AP says that specifically, any equity holder would get a:
* 3% pro rata share of the first $500 million;
* 7.5% of recoveries between $500 million and $1 billion; and
* 15% of recoveries over $1 billion.
Citing Paul Silverstein, Esq., a Andrews Kurth LLP partner, AP
relates that he it would take time to estimate how much those
trusts would be worth and couldn't give a timeline for any
resolution.
The Equity group, AP states, considered the effort successful.
"With more than $2 billion in claims filed against the parent
estates that, if allowed, would be payable before equity receives
a distribution, and given the almost $2 billion aggregate creditor
shortfall, this was a truly remarkable achievement," said the
Committee.
About Refco Inc.
Headquartered in New York City, Refco Inc. (OTC: RFXCQ) --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and $16.8 billion in debts to
the Bankruptcy Court on the first day of its chapter 11 cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).
Refco Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436). (Refco Bankruptcy News, Issue No. 50; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
Plan Update
On Sept. 14, 2006, Refco, Inc., and 25 of its subsidiaries, along
with Marc S. Kirschner, the Chapter 11 Trustee for the estate of
Refco Capital Markets, Ltd., delivered a Chapter 11 plan of
reorganization and accompanying Disclosure Statement to the Court.
On Oct. 10, 2006, the Debtors filed an Amended Plan and Disclosure
Statement and on Oct. 13, filed a Modified Amended Disclosure
Statement. On Oct. 16, 2006, the Court gave its tentative
approval on the Disclosure Statement and the Court Clerk entered
an order on Oct. 20, 2006.
On Dec. 15, the Modified Joint Chapter 11 Plan of Refco Inc. and
certain of its direct and indirect subsidiaries, including Refco
Capital Markets, Ltd., and Refco F/X Associates LLC, was confirmed
by the Court. That Plan became effective on Dec. 26, 2007.
REFCO INC: Wants PlusFunds' $532 Million Claims Disallowed
----------------------------------------------------------
Refco Inc., and its debtor-affiliates, ask the U.S. Bankruptcy
Court for the Southern District of New York to disallow and
expunge Claim Nos. 11288 and 11290 through 11311 filed by
PlusFunds Group, Inc.
J. Gregory St. Clair, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York, tells Judge Drain that the PlusFunds
Claims assert identical claims against each of the Debtors'
estates arising from the decline in value of PlusFunds' assets
under management.
PlusFunds was the investment manager for SPhinX Managed Futures
Fund SPC. PlusFunds organized SPhinX in the Cayman Islands as a
segregated portfolio company on June 6, 2002. SPhinX was
subsequently expanded to include 15 additional segregated
portfolio companies.
Refco, Inc., served as a clearing broker and futures commission
merchant for investment vehicles and funds advised by PlusFunds,
including SPhinX.
Mr. St. Clair relates that in October 2005, SPhinX caused Refco
Capital Markets, Ltd., to preferentially transfer $312,046,266 in
cash to SPhinX's segregated accounts at Refco LLC, thereby moving
away substantially all of SPhinX's invested cash.
The Preference Cash was transferred from Refco, LLC, to Lehman
Brothers' accounts. Following the transfer, Refco announced that
the liquidity within RCM was no longer sufficient to accommodate
client withdrawals, and imposed a 15-day moratorium on
withdrawals from RCM accounts.
The Official Committee of Unsecured Creditors, in December 2005,
initiated an adversary proceeding on behalf of RCM seeking
avoidance and recovery of the preferential transfer made by RCM
to SPhinX. The Bankruptcy Court entered a temporary restraining
order freezing and attaching SPhinX's assets in an amount equal
to the Preference Cash.
The Committee and SPhinX settled the SPhinX Avoidance Action on
April 26, 2006. The SPhinX Settlement provided for the payment
of $263,000,000 to RCM. The Settlement is now pending on appeal
before the U.S. District Court for the Southern District of New
York.
Mr. St. Clair notes that each of the PlusFunds Claims asserts
entitlement to "not less than" $532,046,266, or an amount
precisely equal to the Preference Cash plus (i) an "enterprise
value" of PlusFunds equal to $220,000,000; and (ii) unliquidated
damages in an amount "to be determined at trial".
PlusFunds alleges that Refco's "wrongdoing" was the actual and
proximate cause of:
(i) PlusFunds' loss of its $220,000,000 enterprise value;
(ii) the amount for which PlusFunds may be liable to SphinX
and its investors arising from the SPhinX Avoidance
Action; and
(iii) the loss of any management fee which PlusFunds would
have earned if its business had not collapsed.
PlusFunds also asserts additional unliquidated claims, including
for punitive damages, alleged breach of contract, breach of
fiduciary duty, and similar causes of action, including aiding
and abetting and conspiracy to commit those torts, Mr. St. Clair
adds.
The Debtors want the Claims disallowed because:
-- PlusFunds failed to articulate any facts that could serve
as the basis for an alleged breach of a contractual
obligation or common law duty by the Debtors;
-- PlusFunds failed as a matter of law to state claims on
which relief can be granted;
-- the Claims are lacking in specificity as to be virtually
meaningless and, accordingly, are so facially defective as
to warrant a zero recovery.
Mr. St. Clair contends that PlusFunds does not satisfy the
requirements under New York law to plead a prima facie case of
fraud. Moreover, PlusFunds' general allegations of breach of
contract, breach of fiduciary duty, aiding, abetting, and
conspiracy are similarly unsubstantiated, Mr. St. Clair argues.
To receive the benefit of prima facie validity, a "proof of claim
must set forth facts necessary to support the claim," he
explains.
In the event that the Court does not enter an order disallowing
and expunging the Claims, the Debtors ask Judge Drain to estimate
the Claims at $0 to facilitate timely distributions under the
Debtors' Chapter 11 Plan.
About Refco Inc.
Headquartered in New York City, Refco Inc. (OTC: RFXCQ) --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and $16.8 billion in debts to
the Bankruptcy Court on the first day of its chapter 11 cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).
Refco Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436). (Refco Bankruptcy News, Issue No. 50; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
Plan Update
On Sept. 14, 2006, Refco, Inc., and 25 of its subsidiaries, along
with Marc S. Kirschner, the Chapter 11 Trustee for the estate of
Refco Capital Markets, Ltd., delivered a Chapter 11 plan of
reorganization and accompanying Disclosure Statement to the Court.
On Oct. 10, 2006, the Debtors filed an Amended Plan and Disclosure
Statement and on Oct. 13, filed a Modified Amended Disclosure
Statement. On Oct. 16, 2006, the Court gave its tentative
approval on the Disclosure Statement and the Court Clerk entered
an order on Oct. 20, 2006.
On Dec. 15, the Modified Joint Chapter 11 Plan of Refco Inc. and
certain of its direct and indirect subsidiaries, including Refco
Capital Markets, Ltd., and Refco F/X Associates LLC, was confirmed
by the Court. That Plan became effective on Dec. 26, 2007.
REFCO INC: Wants to Assume Iron Mountain Contracts
--------------------------------------------------
Refco Inc., and its debtor-affiliates seek the U.S. Bankruptcy
Court for the Southern District of New York's permission to assume
two off-site data storage contracts Refco Group Ltd., LLC, entered
into with Iron Mountain.
The Debtors will assume the contracts effective as of the
effective date of their proposed Modified Joint Chapter 11 Plan.
The Debtors need the contracts to complete the liquidation of
their businesses.
The contracts relate to storage facilities, where the Debtors are
maintaining hard copies of documents, as well as electronic
files. The Debtors are obligated to take appropriate measures to
maintain and preserve books and records and any other
documentation required to wind-down their businesses to among
other things, complete tax returns, maintain customer information
in compliance with federal and state regulations, and retain
records to assist in litigation. To minimize storage related
expenses, the Debtors intend to continue to consolidate with
Refco, LLC, their various storage facilities that maintain the
books and records.
The contracts were executed in November 2001 and March 2003. The
November 2001 contract provides for one-year automatic renewals
starting December 1, 2003, unless written notice of non-renewal
is given. The Debtors propose to pay $1,217 to cure outstanding
obligations under the November 2001 contract.
The March 2003 contract provides one-year renewal term with
automatic renewals for additional one-year terms, unless written
notice of non-renewal is given. The Debtors propose to pay
$1,025 to cure outstanding obligations under the contract.
About Refco Inc.
Headquartered in New York City, Refco Inc. (OTC: RFXCQ) --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and $16.8 billion in debts to
the Bankruptcy Court on the first day of its chapter 11 cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).
Refco Commodity Management, Inc., formerly known as CIS
Investments, Inc., a debtor-affiliate of Refco Inc., filed for
chapter 11 protection on Oct. 16, 2006 (Bankr. S.D.N.Y. Case No.
06-12436). (Refco Bankruptcy News, Issue No. 50; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
Plan Update
On Sept. 14, 2006, Refco, Inc., and 25 of its subsidiaries, along
with Marc S. Kirschner, the Chapter 11 Trustee for the estate of
Refco Capital Markets, Ltd., delivered a Chapter 11 plan of
reorganization and accompanying Disclosure Statement to the Court.
On Oct. 10, 2006, the Debtors filed an Amended Plan and Disclosure
Statement and on Oct. 13, filed a Modified Amended Disclosure
Statement. On Oct. 16, 2006, the Court gave its tentative
approval on the Disclosure Statement and the Court Clerk entered
an order on Oct. 20, 2006.
On Dec. 15, the Modified Joint Chapter 11 Plan of Refco Inc. and
certain of its direct and indirect subsidiaries, including Refco
Capital Markets, Ltd., and Refco F/X Associates LLC, was confirmed
by the Court. That Plan became effective on Dec. 26, 2007.
SEA CONTAINERS: HSH Nordbank Doesn't Object to Aegean Stake Sale
----------------------------------------------------------------
HSH Nordbank AG, an unsecured creditor in Sea Containers, Ltd. and
its debtor-affiliates chapter 11 case, does not object to the sale
of the Debtors' 50% interest in their Aegean Speed Lines NE joint
venture to Speed Shipping Company Ltd., pursuant to a sale
agreement dated November 2006 between the Debtors, Speed Shipping,
ASL, Niver Lines Shipping Co. SA, Hoverspeed GB Ltd., and Sea
Containers Cyprus Holdings Ltd.
HSH Nordbank wants to clarify that the mortgage on ASL's vessel,
Speedrunner 1, secures the obligations of Hoverspeed GB
Limited. Hoverspeed's obligations in turn guarantee the
principal obligations that Hoverspeed Italia Srl owes to HSH
Nordbank, which principal obligations are guaranteed by Sea
Containers Ltd.
As reported in the Troubled Company Reporter on Dec. 4, 2006, the
Debtors and Speed Shipping, who each owns 50% interest in ASL, had
entered into a shareholders' agreement in February 2005, under
which the parties each subscribed for 2,500 shares in ASL.
ASL has no other operations aside from operating Speedrunner 1, a
passenger ferry. HGB, an indirect, wholly owned subsidiary of the
Debtors, owns Speedrunner 1 and charters it to SC Cyprus. SC
Cyprus, in turn, sub-charters the ferry to ASL.
Under the Shareholders' Agreement, the Debtors are obliged to make
subordinated loans to ASL in amounts necessary to meet its
portion of ASL's liability to third party creditors.
HGB had agreed to sell the Vessel to Speed Shipping for
$2,000,000. In conjunction with the sale, the Debtors also agreed
to sell their 50% stake in the ASL joint venture to Speed
Shipping, and the release of its obligations under the
Shareholders' Agreement.
About Sea Containers
Headquartered in Hamilton, Bermuda, Sea Containers Ltd. --
http://www.seacontainers.com/-- provides passenger and freight
transport and marine container leasing. Registered in Bermuda,
the company has regional operating offices in London, Genoa, New
York, Rio de Janeiro, Sydney, and Singapore. The company is
owned almost entirely by United States shareholders and its
primary listing is on the New York Stock Exchange (SCRA and
SCRB) since 1974. On Oct. 3, the company's common shares and
senior notes were suspended from trading on the NYSE and NYSE
Arca after the company's failure to file its 2005 annual report
on Form 10-K and its quarterly reports on Form 10-Q during 2006
with the U.S. Securities and Exchange Commission.
Through its GNER subsidiary, Sea Containers Passenger Transport
operates Britain's fastest railway, the Great North Eastern
Railway, linking England and Scotland. It also conducts ferry
operations, serving Finland and Estonia as well as a commuter
service between New York and New Jersey in the U.S.
Sea Containers Ltd. and two subsidiaries filed for chapter 11
protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156).
Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they reported
US$1.7 billion in total assets and US$1.6 billion in total
debts. (Sea Containers Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
SEA CONTAINERS: Wants to Pay Employees Dismissed During Bankruptcy
------------------------------------------------------------------
Sea Containers, Ltd. and its debtor-affiliates ask authority from
the Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware to comply with their statutory obligations
and pay the notice and redundancy payments required under the
Employment Rights Act 1996 (England) to employees they dismissed
after the Debtors filed for bankruptcy, in connection with their
business rationalization efforts.
As part of their restructuring efforts, the Debtors are
evaluating their business operations and staffing needs on an
ongoing basis. The Debtors believe it will be necessary to
reduce the overall size of their workforce through layoffs of
employees whose services are no longer required due to the
rationalization of their business operations, Robert S. Brady,
Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington,
Delaware relates.
Mr. Brady tells the Court that the Debtors, as required by the
ERA and in the ordinary course of business, have entered into an
employment contract with each of their Employees stating the
length of notice, which the Debtors are obliged to give the
Employee to terminate his/her contract of employment.
The Debtors estimate that the potential aggregate cost of
Statutory Redundancy Payments that would be owed to their
Employees who may be dismissed over the next nine months is
$647,000. Claims by Dismissed Employees arising from the
Debtors' failure to abide by the ERA's statutory requirements
would be entitled to administrative expense priority pursuant to
Section 503(b)(1)(A) of the Bankruptcy Code, Mr. Brady says.
Mr. Brady tells Judge Carey that any failure by the Debtors to
comply with their statutory obligations under the ERA and to make
the required Statutory Payments to Dismissed Employees will:
-- result in numerous administrative expense claims being
asserted against the Debtors and their estates;
-- subject the Debtors to legal action in England, which
could, among other things, cause estate resources to be
depleted by defending the actions, and could jeopardize
the Debtors' ability to restructure their operations; and
-- cause an adverse effect on the morale and loyalty of the
Debtors' remaining Employees, at a time when the support
is critical.
About Sea Containers
Headquartered in Hamilton, Bermuda, Sea Containers Ltd. --
http://www.seacontainers.com/-- provides passenger and freight
transport and marine container leasing. Registered in Bermuda,
the company has regional operating offices in London, Genoa, New
York, Rio de Janeiro, Sydney, and Singapore. The company is
owned almost entirely by United States shareholders and its
primary listing is on the New York Stock Exchange (SCRA and
SCRB) since 1974. On Oct. 3, the company's common shares and
senior notes were suspended from trading on the NYSE and NYSE
Arca after the company's failure to file its 2005 annual report
on Form 10-K and its quarterly reports on Form 10-Q during 2006
with the U.S. Securities and Exchange Commission.
Through its GNER subsidiary, Sea Containers Passenger Transport
operates Britain's fastest railway, the Great North Eastern
Railway, linking England and Scotland. It also conducts ferry
operations, serving Finland and Estonia as well as a commuter
service between New York and New Jersey in the U.S.
Sea Containers Ltd. and two subsidiaries filed for chapter 11
protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156).
Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they reported
US$1.7 billion in total assets and US$1.6 billion in total
debts. (Sea Containers Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
SMART MODULAR: Earns $14.6 Million in First Quarter Ended Nov. 30
-----------------------------------------------------------------
SMART Modular Technologies (WWH) Inc. filed its financial
statements for the first fiscal quarter ended Nov. 30, 2006, with
the Securities and Exchange Commission on Dec. 22, 2006.
GAAP net income for the first quarter of fiscal 2007 was
$14.6 million, compared to net income of $15.7 million for the
fourth quarter of fiscal 2006, and $9.3 million for the first
quarter of fiscal 2006.
Net sales for the first quarter of fiscal 2007 were
$237.2 million, up 20% compared to $197.0 million for the fourth
quarter of fiscal 2006, and up 50% compared to $158.3 million for
the first quarter of fiscal 2006.
Gross profit for the first quarter of fiscal 2007 was
$37.9 million, up 13% compared to $33.5 million for the fourth
quarter of fiscal 2006, and up 24% compared to $30.6 million for
the first quarter of fiscal 2006.
SMART ended the first quarter of fiscal 2007 with $94 million in
cash and cash equivalents.
"We are pleased to deliver results that exceeded the high end of
our revised guidance as we continue our track record of profitable
growth," Iain MacKenzie, president and chief executive officer,
stated. "Our value-add customer application focus has continued
to bring us success in leveraging our strengths as the largest
independent OEM focused manufacturer of electronic subsystems.
Additionally, we have made progress in our revenue diversification
strategy with another key design win in our embedded and display
group. We believe that this design win, in conjunction with a
number of requests for evaluation samples of our XceedPC and
XceedNP product families should fuel the growth of our non-memory
businesses as we broaden our product offerings and expand into the
high growth Embedded and Display markets."
At Nov. 30, 2006, the company's balance sheet showed
$466.7 million in total assets, $303.6 million in total
liabilities, and $163 million in total stockholders' equity.
About SMART Modular
Smart Modular Technologies (WWH) Inc. (Nasdaq: SMOD) --
http://www.smartm.com/-- designs, manufactures and supplies
electronic subsystems to original equipment manufacturers (OEMs).
Smart offers more than 500 standard and custom products to OEMs
engaged in the computer, industrial, networking, gaming,
telecommunications, and embedded application markets.
Solectron Corp. owned SMART Modular between 1999 and 2004. The
business was later spun out of Solectron in April 2004 to private
equity investors and management.
* * *
Moody's Investors Service assigned a B2 rating to SMART Modular
Technologies (WWH) Inc.'s $125 million senior secured second lien
notes due 2012 issued under Rule 144A.
Standard & Poor's Ratings Services assigned its B+ corporate
credit rating to Fremont, California-based SMART Modular
Technologies (WWH) Inc.
STRUCTURED ADJUSTABLE: Fitch Rates $1 Million Certificates at BB
----------------------------------------------------------------
Fitch rates Structured Adjustable Rate Mortgage Loan Trust's
$206 million mortgage pass-through certificates, series 2006-12,
which closed Dec. 29, 2006, as:
-- $195.3 million classes 2-A1, 2-A2, 2-AX, 2-PAX and R 'AAA';
-- $4.9 million class B1-II 'AA';
-- $2.2 million class B2-II 'A';
-- $1.7 million class B3-II 'BBB';
-- $1.0 million class B4-II 'BB' (144A);
-- $930,000 class B5-II 'B' (144A).
The Group II 'AAA' rating on the senior certificates reflects the
5.50% total credit enhancement provided by the 2.35% class B1-II,
the 1.05% class B2-II, the 0.80% class B3-II, the privately
offered 0.50% class B4-II, and the privately offered 0.45% class
B5-II, as well as the non-rated, privately offered 0.35% class B6-
II.
Fitch believes that the amount of credit enhancement will be
sufficient to cover credit losses, including limited bankruptcy,
fraud and special hazard losses. In addition, the ratings reflect
the quality of the mortgage collateral, the strength of the legal
and financial structures, and the master servicing capabilities of
Aurora Loan Services, Inc. (rated 'RMS1-' by Fitch) and the
primary servicing capabilities of Aurora Loan Services LLC,
Countrywide Home Loans Servicing LP, and GreenPoint Mortgage
Funding, Inc.
Group II consists of 347 adjustable-rate, conventional, first lien
residential mortgage loans, substantially all of which have
original terms to stated maturity of 30 years. As of the cut-off
date (December 1, 2006), the mortgages have an aggregate principal
balance of approximately $206,702,867. The Group II mortgage pool
has a weighted average original loan-to-value ratio (OLTV) of
72.70%, a weighted average coupon of 6.728%, and a weighted
average remaining term of 359.
None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws.
The mortgage loans were originated by various originators or
acquired by various originators or their correspondents in
accordance with such originator's respective underwriting
standards and guidelines. The largest percentages of originations
(as a percentage of the cut-off date balance) are Lehman Brothers
Bank, FSB (51.40%), Countrywide Home Loans Servicing LP (26.68%),
and GreenPoint Mortgage Funding, Inc. (15.01%).
SASCO, a special purpose corporation, deposited the loans in the
trust, which issued the certificates. For federal income tax
purposes, an election will be made to treat the trust fund as
multiple real estate mortgage investment conduits.
STRUCTURED ASSET: Fitch Rates $7 Million Certificates at BB
-----------------------------------------------------------
Fitch rates Structured Asset Securities Corp. $203.9 million
mortgage pass-through certificates, series 2006-Z as:
-- $150.7 million classes A1 and A2 'AAA' (144A);
-- $20.5 million class M1 'AA' (144A);
-- $4.2 million class M2 'AA-' (144A);
-- $8.9 million class M3 'A' (144A);
-- $7.2 million class M4 'BBB+' (144A);
-- $3.4 million class M5 'BBB' (144A);
-- $2.0 million class M6 'BBB-' (144A);
-- $7.0 million class B2 'BB' (144A).
The 'AAA' rating on the senior certificates reflects the 28.65%
total credit enhancement provided by the 9.70% class M1, 2.00%
class M2, 4.20% class M3, 3.40% class M4, 1.60% class M5, 0.95%
class M6, 1.55% class B1 (not rated by Fitch), and 3.30% class B2,
as well as the initial 1.95% overcollateralization. All
certificates were privately offered.
Fitch believes that the amount of credit enhancement will be
sufficient to cover credit losses, including limited bankruptcy,
fraud and special hazard losses. In addition, the ratings reflect
the quality of the mortgage collateral, the strength of the legal
and financial structures, and the master servicing capabilities of
Aurora Loans Services LLC, which is rated 'RMS1-' by Fitch.
The aggregate trust consists of 1,220 fixed and adjustable-rate,
conventional, first and second lien residential mortgage loans,
substantially all of which have original terms to maturity of not
more than 30 years. As of the cut-off date (December 1, 2006),
the mortgages have an aggregate principal balance of approximately
$211,262,167. Approximately 12.81% of the mortgage pool is fixed
rate and 87.19% is adjustable. The mortgage pool has a weighted
average original loan-to-value ratio (OLTV) of 92.75%, a weighted
average coupon (WAC) of 9.408%, and a weighted average remaining
term (WAM) of 350.
None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws.
The mortgage loans were originated by various originators or
acquired by various originators or their correspondents in
accordance with such originator's respective underwriting
standards and guidelines. The largest percentages of originations
(as a percentage of the cut-off date balance) were those made by
Option One Mortgage Corporation (46.28% of the mortgage pool) and
BNC Mortgage, Inc. (44.40% of the mortgage pool).
SASCO, a special purpose corporation, deposited the loans in the
trust, which issued the certificates. For federal income tax
purposes, an election will be made to treat the trust fund as
multiple real estate mortgage investment conduits.
TABERNA FUNDING II: Fitch Holds BB+ Rating on $42.5 Million Notes
-----------------------------------------------------------------
Fitch affirms 12 classes of notes issued by TABERNA Preferred
Funding II, Ltd. These affirmations are the result of Fitch's
review process and are effective immediately:
-- $400,000,000 class A-1A notes affirmed at 'AAA';
-- $106,500,000 class A-1B notes affirmed at 'AAA';
-- $10,000,000 class A-1C notes affirmed at 'AAA';
-- $86,500,000 class A-2 notes affirmed at 'AAA';
-- $120,500,000 class B notes affirmed at 'AA';
-- $73,750,000 class C-1 notes affirmed at 'A';
-- $26,000,000 class C-2 notes affirmed at 'A';
-- $15,000,000 class C-3 notes affirmed at 'A';
-- $31,250,000 class D notes affirmed at 'A-';
-- $30,259,765 class E-1 notes affirmed at 'BBB';
-- $10,167,281 class E-2 notes affirmed at 'BBB';
-- $42,500,000 class F notes affirmed at 'BB+'.
TABERNA II is a collateralized debt obligation that closed
June 28, 2005 and is managed by TABERNA Capital Management, LLC.
TABERNA II has a static portfolio composed of trust preferred
securities issued by subsidiaries of real estate investment trusts
and real estate operating companies, senior REIT debt securities,
and commercial-mortgage-backed securities. Of the total
portfolio, approximately 88% are REIT trust preferred securities,
approximately 3% are CMBS, and approximately 9% are senior REIT
debt securities.
Since close, the collateral has continued to exhibit stable
performance. The class A/B, C and D overcollateralization (OC)
ratios have remained stable at 138.22%, 119.30% and 115.01%,
respectively versus their triggers at 128%, 113% and 110.5%,
respectively. The class E and class F OC ratios have improved to
109.8% from 109.7% and 104.9% from 104.8%, respectively due to pay
down of class E-1 and E-2 notes through an equity cap feature of
the deal.
The ratings of the class A-1A, A-1B, A-1C, A-2 and B notes address
the likelihood that investors will receive full and timely
payments of interest, as per the governing documents, as well as
the stated balance of principal by the legal final maturity date.
The ratings of the class C-1, C-2, C-3, D and E-1, E-2 and F notes
address the likelihood that investors will receive ultimate and
compensating interest payments, as per the governing documents, as
well as the stated balance of principal by the legal final
maturity date.
Fitch will continue to monitor and review this transaction for
future rating adjustments.
TABERNA FUNDING III: Fitch Holds BB+ Rating on $31.5 Million Notes
------------------------------------------------------------------
Fitch affirms 10 classes of notes issued by TABERNA Preferred
Funding III, Ltd.
These affirmations are the result of Fitch's review process and
are effective immediately:
-- $398,500,000 class A-1A notes affirmed at 'AAA';
-- $10,000,000 class A-1C notes affirmed at 'AAA';
-- $38,500,000 class A-2A notes affirmed at 'AAA';
-- $15,000,000 class A-2B notes affirmed at 'AAA';
-- $91,250,000 class B-1 notes affirmed at 'AA';
-- $7,500,000 class B-2 notes affirmed at 'AA';
-- $36,500,000 class C-1 notes affirmed at 'A';
-- $52,000,000 class C-2 notes affirmed at 'A';
-- $43,750,000 class D notes affirmed at 'BBB';
-- $31,500,000 class E notes affirmed at 'BB+.
TABERNA III is a collateralized debt obligation that closed
Sept. 29, 2005 and is managed by TABERNA Capital Management, LLC.
TABERNA III has a static portfolio composed of trust preferred
securities and subordinated debt issued by subsidiaries of real
estate investment trusts, real estate operating companies,
homebuilders and a publicly rated specialty finance company, as
well as senior REIT debt securities and commercial mortgage-backed
securities. Of the total portfolio, approximately 90% are trust
preferred securities and subordinated debt, approximately 7% are
senior REIT debt securities and 3% are CMBS.
Since close, the collateral has continued to exhibit stable
performance. The class A/B, C, D and E overcollateralization (OC)
ratios have remained stable at 133.75%, 115.52%, 108.23% and
103.52%, respectively versus their triggers at 120.25%, 110.42%,
105.23% and 101.02%, respectively. Structural features included a
delayed draw mechanism for the class A-1B notes. In February
2006, the $210.0 million class A-1B delayed draw notes were
converted to class A-1A notes and added to the existing $188.5
million balance of the class A-1A notes. As the class A-1A and
class A-1B ranked pari passu with respect to principal and
interest payments, the conversion did not impact the transaction's
capital structure or the ratings assigned by Fitch to the issued
liabilities.
The ratings of the class A-1A, A-1C, A-2A, A-2B, B-1 and B-2 notes
address the likelihood that investors will receive full and timely
payments of interest, as per the governing documents, as well as
the stated balance of principal by the legal final maturity date.
The ratings of the class C-1, C-2, D and E notes address the
likelihood that investors will receive ultimate and compensating
interest payments, as per the governing documents, as well as the
stated balance of principal by the legal final maturity date.
Fitch will continue to monitor and review this transaction for
future rating adjustments.
TELECONNECT INC: Murrell Hall Express Going Concern Doubt
---------------------------------------------------------
Murrell, Hall, McIntosh & Co. PLLP, expressed substantial doubt
about Teleconnect Inc.'s ability to continue as a going concern
after auditing the company's financial statements for the year
ended Sept. 30, 2006. The auditing firm pointed to the company's
recurring losses from operations and net capital deficiency.
Teleconnect Inc. reported a $3.9 million net loss on $4.7 million
of sales for the year ended Sept. 30, 2006, compared with a
$3 million net loss on $4.9 million of sales for the year ended
Sept. 30, 2005.
The increase in net loss is primarily due to the $273,000 decrease
in sales and the $1.5 million increase in selling, general and
administrative expenses, partly offset by the decrease in
depreciation expenses, the increase in other income, and the
decrease in interest expenses.
Selling, general and administrative expenses increased due to
the stock issued to employees and consultants which totaled
$2.8 million.
Depreciation expense for the year ended Sept. 30, 2006,
was $240,000, a decrease of $204,000 from the prior year's
depreciation expense of $444,000. This decrease is due primarily
to the fact that some equipment became fully depreciated in 2006.
Interest expense for the year ended Sept. 30, 2006 was
$358,000 as compared to $474,000 for the prior year. This
decrease was due primarily to loans converted to common stock
during 2006.
Other income for 2006 was $285,000 compared to other expense of
$37,000 in 2005. This improvement was due primarily to a
settlement with a former officer and the write off of certain
payables for which the company believes the vendors have lost
their rights to collect.
At Sept. 30, 2006, the company's balance sheet showed $1.4 million
in total assets and $7.2 million in total liabilities, resulting
in a $5.8 million total stockholders' deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $813,000 in total current assets available
to pay $7.2 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the year ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17e1
Teleconnect Inc. (OTCBB: TLCO) fka ITS Networks Inc. began as a
call-back service for foreign visitors to the south coast of
Spain, but now provides prepaid fixed-line and mobile long-
distance and rechargeable prepaid calling cards. After changing
management in 2000, the company acquired Spanish telecom firm ITS
Europe. In 2002 Teleconnect acquired prepaid calling card
business Teleconnect Comunicaciones. Teleconnect sold its
postpaid telephone operations to Affinalia in 2003.
TXU CORP: Voluntarily Withdraws Securities from NYSE Arca Listing
-----------------------------------------------------------------
TXU Corp. plans to voluntarily withdraw its securities from
listing on NYSE Arca, Inc., formerly the Pacific Exchange. TXU's
securities will continue to be listed on the New York Stock
Exchange.
The decision to voluntarily withdraw listing from NYSE Arca, Inc.
was made to eliminate duplicative administrative requirements
inherent with dual listings as a result of the NYSE Group's recent
merger with Archipelago Holdings, the parent company of NYSE Arca.
NYSE Arca will continue trading TXU's securities on an unlisted
trading privilege basis.
In order to further eliminate duplicative administrative
requirements, TXU Corp. is evaluating delisting its securities on
the Chicago Stock Exchange. This evaluation is expected to be
completed in the first quarter of 2007.
About TXU Corp.
Headquartered in Dallas, Texas, TXU Corp. (NYSE: TXU) --
http://www.txucorp.com/-- is an energy company that manages a
portfolio of competitive and regulated energy businesses in North
America. In TXU Corp.'s unregulated business, TXU Energy provides
electricity and related services to 2.5 million competitive
electricity customers in Texas, more customers than any other
retail electric provider in the state. TXU Power has over 18,300
megawatts of generation in Texas, including 2,300 MW of nuclear
and 5,837 MW of lignite/coal-fired generation capacity.
TXU Corp.'s 6.55% Senior Notes due 2034 carry Moody's Investors
Service's Ba1 rating and Standard & Poor's BB+ rating.
UAL CORP: Court Okays Agreement Settling Webb Electric's Claim
--------------------------------------------------------------
In an agreed order signed by the Hon. Eugene R. Wedoff of the U.S.
Bankruptcy Court for the Northern District of Illinois, UAL
Corporation and its affiliates and Webb Electric Company agree
that Webb Electric will be provided with an $800,000 allowed
general unsecured claim under the Debtors' confirmed Plan of
Reorganization.
By agreement between the parties, Webb Electric's request for
allowance of, and distribution on, its claim is withdrawn.
Webb Electric's Claim
Webb had asked the Court to allow its claim for $1,530,910.
On February 4, 2003, Webb Electric, filed a proof of claim for
$1,530,910 plus interest and other charges against the Debtors'
estate.
The Claim asserts damages for costs incurred far exceeding the
contractual amounts owed to Webb as a result of delays by United
Air Lines, Inc., and other parties to the construction of the
United Airlines Air Cargo Facility at Newark International
Airport.
Neither United nor any other party has filed an objection to
Webb's claim, Michael Yetnikoff, Esq., at Schiff Hardin LLP, in
Chicago, Illinois, relates.
Prior to filing for bankruptcy, United entered into a contract
with Webb under which Webb was to serve as prime electrical
contractor on the Project. In the course of the Project, United
demanded, and Webb met, the original deadlines in the agreement
despite more than five months of delay caused by other parties.
As a result, Mr. Yetnikoff says, United is deemed to have
"constructively accelerated" Webb's contract with respect to the
Facility.
Mr. Yetnikoff asserts that Webb incurred $1,530,910 in damages
due to the delays caused by United and the constructive
acceleration and actual acceleration of the contract.
Mr. Yetnikoff notes that the Debtor has not made a distribution
to Webb, suggesting that it will object to the $1,530,910 Claim.
United, however, has filed 43 "Omnibus Objections to Claims"
without including Webb's claim.
Webb believes that it is in its best interest, as well as the
best interests of the estate, to pursue allowance of its claim,
for these reasons:
(a) United's Chapter 11 Plan does not set a deadline for
filing objections to claims;
(b) The Plan provides that no distribution is made to a
creditor until the creditor's claim is allowed;
(c) United can delay distribution to Webb for an undetermined
period of time;
(d) Under the Plan, United is distributing shares of stock
in the Reorganized Debtor. The price of those shares of
stock -- and the value of the distribution to creditors --
is subject to market forces related to United and macro-
economic factors beyond the control of either party.
Webb has been denied the opportunity to apply its best
economic judgment to determine when to "cash out" its
investment; and
(e) The issues involved significant amounts and may require
significant proof.
Thus, there is no reason to delay adjudication of Webb's claim,
Mr. Yetnikoff maintains. Judicial economy justify a hearing on
Webb's claim in accordance with Webb's timetable, without further
delay, he adds.
About UAL Corp.
Headquartered in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- through United Air Lines, Inc., is
the holding company for United Airlines -- the world's second
largest air carrier. The Company filed for chapter 11 protection
on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy. When the
Debtors filed for protection from their creditors, they listed
$24,190,000,000 in assets and $22,787,000,000 in debts. Judge
Wedoff confirmed the Debtors' Second Amended Plan on Jan. 20,
2006. The Company emerged from bankruptcy protection on Feb. 1,
2006. (United Airlines Bankruptcy News, Issue No. 136; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
* * *
Moody's Investors Service assigned ratings in July 2006 to United
Air Lines Inc.'s Pass Through Trust Certificates, Series 2000-1:
Ba3 rating to $233,244,336 Class A-1 Certificates; Ba3 rating to
$324,913,300 Class A-2 Certificates; and B3 rating to $186,368,450
Class B Certificates.
UAL CORP: Discloses Status of Plan Consummation as of Dec. 2006
---------------------------------------------------------------
Erik W. Chalut, Esq., at Kirkland & Ellis LLP, in Chicago,
Illinois, reports that:
* As of December 13, 2006, United Air Lines, Inc., has
authorized the issuance of approximately 107,300,000 shares,
which represents 93.3% of the 115,000,000 shares of New UAL
Common Stock available to United's employees and creditors;
* As of October 31, 2006, approximately 100,000 shares has
been distributed in connection with the Director Equity
Incentive Plan of a total 175,000 shares available, and
approximately 3,800,000 shares has been distributed in
connection with the Management Equity Incentive Plan of a
total 9,825,000 shares available.
* As of December 13, 2006, United will have distributed
approximately 25,400,000 shares of New UAL Common Stock to
its employees' 401(k) plans. Additionally, after monetizing
1,900,000 shares to satisfy tax-withholding obligations,
employees and retirees will have received 3,900,000 net
shares directly.
Matters Pending Outside of Circuit
In litigation pending outside the Seventh Circuit, the appeal
filed by the Aircraft Mechanics Fraternal Association to the
Fourth Circuit Court of Appeals from the ruling of the U.S.
District Court for the Eastern District of Virginia -- that the
effective termination date of the Ground Plan would be
March 11, 2005 -- has been fully briefed, and the appeal is
awaiting decision.
According to Mr. Chalut, United expects to continue to distribute
as much stock as it can to its unsecured creditors and to take
all other actions that are necessary to effectuate the terms of
its confirmed Reorganization Plan.
Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier. The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts. When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.
About UAL Corp.
Headquartered in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- through United Air Lines, Inc., is
the holding company for United Airlines -- the world's second
largest air carrier. The Company filed for chapter 11 protection
on Dec. 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy. When the
Debtors filed for protection from their creditors, they listed
$24,190,000,000 in assets and $22,787,000,000 in debts. Judge
Wedoff confirmed the Debtors' Second Amended Plan on Jan. 20,
2006. The Company emerged from bankruptcy protection on Feb. 1,
2006. (United Airlines Bankruptcy News, Issue No. 136; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
* * *
Moody's Investors Service assigned ratings in July 2006 to United
Air Lines Inc.'s Pass Through Trust Certificates, Series 2000-1:
Ba3 rating to $233,244,336 Class A-1 Certificates; Ba3 rating to
$324,913,300 Class A-2 Certificates; and B3 rating to $186,368,450
Class B Certificates.
UTSTARCOM INC: Seeks Waiver of Default from Holders of 7/8% Notes
-----------------------------------------------------------------
UTStarcom, Inc., is soliciting consents from the holders of its
7/8% convertible subordinated notes due 2008 relative to proposed
amendments of certain provisions of the indenture pursuant to
which the notes were issued and a waiver of rights to pursue
remedies available under the indenture with respect to certain
defaults.
The consent solicitation is expected to expire at 5:00 p.m., New
York City time, on Jan. 5, 2007.
Holders of record as of 5:00 p.m., New York City time, on December
21, 2006, who validly deliver and do not revoke their consents
prior to the Expiration Date, will receive a consent fee of
$5,492,000 divided pro rata among all consenting noteholders.
The effectiveness of the proposed amendments and waiver and the
payment of the consent fee is subject to the receipt of valid
consents that are not revoked in respect of at least a majority of
the aggregate principal amount outstanding of the notes.
Holders of the notes may revoke their consents at any time before
the proposed amendments and waiver become effective, but upon
receipt by the company of the consents of a majority of holders of
the notes and evidence of the receipt provided to the trustee the
waiver will become effective, a supplemental indenture setting
forth the amendments will be executed and consents may no longer
be revoked unless the company fails to pay holders the consent
fee.
As reported in the Troubled Company Reporter on Nov. 27, 2006, the
company received notice from the Trustee for the holders of its
7/8% Convertible Subordinated Notes due 2008, asserting that
failure to file its Form 10-Q on or before Jan. 9, 2007,
constitute and event of default under the Indenture.
Citigroup Global Markets Inc. is serving as the solicitation agent
for the consent solicitation. Questions regarding the consent
solicitation may be directed to Citigroup Global Markets Inc. at
(800) 558-3745 (toll-free) or (212) 723-6106.
The information agent for the consent solicitation is Global
Bondholder Services Corporation. Requests for copies of the
Consent Solicitation Statement and related documents may be
directed to Global Bondholder Services Corporation at
(866) 794-2200 (toll- free) or (212) 430-3774.
Alameda, Calif.-based UTStarcom Inc. provides IP-based, end-to-end
networking solutions and international service and support. The
company sells its broadband, wireless, and handset solutions to
operators in both emerging and established telecommunications
markets around the world. The company has research and design
operations in the United States, China, Korea, and India.
VESTA INSURANCE: Court Confirms Third Amended Liquidation Plan
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama
confirms Vesta Insurance Group, Inc.'s Third Amended Chapter 11
Plan of Liquidation.
The effective date of Plan was on Dec. 26, 2006.
Vesta made certain non-material modifications to the Second
Amended Chapter 11 Plan of Liquidation in response to certain of
the objections to the Plan's confirmation.
Wilmington Trust's Objections
Wilmington Trust Company argued that the Second Amended Plan is
not in the best interests of creditors and is not feasible.
Wilmington Trust is the successor indenture trustee, successor
property trustee, successor guarantee trustee, successor paying
agent, registrar and transfer agent and successor Delaware
trustee with respect to the Indenture dated as of January 31,
1997, pursuant which Vesta Insurance Group, Inc., issued its
8.525% Junior Subordinated Deferrable Interest Debentures.
Andrew I. Silfen, Esq., at Arent Fox PLLC, in New York, New York,
representing Wilmington Trust, pointed out that the Second
Amended Plan is swathed in layers of administrative costs,
including the compensation and reimbursement of the Plan Trustee,
and any professionals that the Plan Trustee hires, that will
significantly reduce the distribution that unsecured creditors
would otherwise receive on their claims.
Fees and expenses of a Chapter 7 Trustee, Mr. Silfen noted, are
subject to Bankruptcy Court approval, and the estate would not
incur the expense of disgorging fees if the fees are later
determined to be unreasonable and not allowable.
Similarly, as a Chapter 7 Trustee would be compensated according
to the amount recovered for the estate, and not according to the
time spent on the actual liquidation, a Chapter 7 Trustee would
have a strong incentive to maximize the value of the assets over
the shortest possible period of time, thus resulting in a faster
distribution for creditors, Mr. Silfen argued.
In addition, the $5,000,000 currently held by the estate will
presumably be used, at least in part, to pay the initial fees and
expenses of the Plan Trustee and its professionals. There is no
guarantee that the Plan Trustee will successfully liquidate the
estate's asset and be able to return these funds to general
unsecured creditors, the true stakeholders of the case,
Mr. Silfen averred.
In a Chapter 7 liquidation, the money would stay in the estate
until the close of the case, accruing interest, and would only be
distributed after, potentially increasing the recovery of the
creditors, Mr. Silfen argued.
Mr. Silfen told the Court that the Debtor also did not include a
liquidation analysis in its Second Amended Plan or related
documents to show the amount it believes the estate will recover
through its Plan. Case law indicates that judgment based on
Section 1129(a)(7)(A) must be based on evidence, not assumptions.
With no liquidation analysis, it is impossible to determine how
much money will be brought into the estate to pay creditors'
claims, or even whether the post-confirmation process will remain
solvent, he said.
That the Second Amended Plan will result in any money to fund it
is purely speculative, and there is no evidence that it can be
successfully implemented. Merely providing for liquidation does
not make a plan feasible, Mr. Silfen argued.
Special Deputy Receiver's Objections
Prime Tempus, Inc., the Special Deputy Receiver appointed by the
Texas Department of Insurance to oversee the receiverships of The
Texas Insurance Companies, aired its objection to the Second
Amended Plan to the extent that it seeks to allow the Plan
Committee to retain and compensate professionals in addition to
the attorneys that are to be retained by the Plan Trustee.
George H. Tarpley, Esq., at Cox Smith Matthews Incorporated, in
Dallas, Texas, argued that the Plan layers on additional
professionals without attempting to limit their role to avoid
duplicative work and unnecessary oversight and monitoring.
The Special Deputy Receiver also aired its objection to the Plan
to the extent the provisions interfere with the Texas state
court's exercise of jurisdiction over and administration of the
Texas Insurance Companies' receiverships.
Mr. Tarpley maintained that to the extent the entire Plan is
limited by the effect of Article 12.13, any order confirming the
Plan should specifically include language making clear that
consummation of the Plan will in no way interfere with the State
Court's continued exercise of jurisdiction over and
administration of the Receiverships.
The Special Deputy Receiver represents the interests of the Texas
Insurance Companies in Vesta's case. Vesta Fire Insurance
Company, one of the Texas Insurance Companies, has filed a proof
of claim in the Debtor's case asserting an unsecured claim for
$69,118,664.
Vesta & Committee Respond to Objections
Vesta has modified the Second Amended Plan to address the
duplication of efforts objection of the Special Deputy Receiver.
Representing Vesta, Rufus T. Dorsey, IV, Esq., at Parker, Hudson,
Rainer & Dobbs, LLP, in Atlanta, Georgia, however, argued that
the remaining objections of the Special Deputy Receiver should be
overruled.
Section 12.13 of the Plan already applies generally to all other
provisions of the Plan, and therefore the Special Deputy
Receiver's concerns that the limiting provision of the Section
may not be deemed applicable to certain specific provisions is
simply not the case, Mr. Dorsey contended. The changes requested
are unnecessary, he said.
In addition, Wilmington Trust's objections to the Plan are
without merit, Mr. Dorsey told the Court. Wilmington Trust
objects on behalf of a class consisting of 17 persons who did not
even bother to vote, either in favor of or against, on the Plan,
he pointed out.
Even if the Second Amended Plan is revised to reflect the changes
that Wilmington Trust appears to want, the Class D holders will
not recover any additional funds, Mr. Dorsey maintained. He
noted that the Debtor's estate would have to recover well in
excess of $100,000,000 to pay Classes A through C in full, since
Class D claimants are contractually subordinated to more that
$100,000,000 in claims.
On Wilmington Trust's objection to the Plan's feasibility,
Mr. Dorsey explained that the Debtor has ample cash on hand to be
able to satisfy the known priority and administrative claims
requiring payment on the Effective Date. The ability to satisfy
these claims is not dependent on any decision by an outside
agency or any other contingencies, he added.
In addition, the Official Committee of Unsecured Creditors
of Vesta Insurance noted that if the Debtor's case were converted
at the confirmation hearing, only a Chapter 7 trustee would have
standing to assert the Claims on behalf of the estate. The
Committee, which has been granted derivative standing to assert
the Claims, would no longer exist, nor would there be a Plan
Trustee to assert the Claims, Colin M. Bernardino, Esq., at
Kilpatrick Stockton LLP, in Atlanta, Georgia, counsel for the VIG
Committee, told the Court.
The hypothetical Chapter 7 trustee would not have time to
properly investigate the Claims or otherwise familiarize himself
with the Committee's work to date. Suffice it to say that it is
highly unlikely that the hypothetical Chapter 7 trustee would
succeed in effectively asserting the Claims under the Policies by
the December 31, 2006 deadline, Mr. Bernardino maintained. He
asserted that failure to do so would result in loss of coverage
under the Lloyd's Policy and loss of the opportunity to obtain a
refund of $1.25 million for the estate by effecting cancellation
of the Policy Extension, he adds.
Plan Modifications
To address the Special Deputy Receiver's concerns regarding the
duplication of services of the professionals of the Plan Trustee
and Plan Committee, the Third Amended Plan provides:
* The Post-Confirmation Professionals retained by the Plan
Committee will not be entitled to be compensated from
funds available in the Estate except for services rendered
in order to facilitate the Plan Committee's discharge of
its authority;
* The Post-Confirmation Professionals will file with the
Bankruptcy Court their statements for services rendered
and expenses incurred, to be subject for review and
objection by any party-in-interest, including the Plan
Trustee; and
* Any objection to the fees and expenses will be resolved by
the Bankruptcy Court, but the filing of any objection will
not operate to defer the payment of any fees and expenses.
The Third Amended Plan also provides that the employee-related
agreements relating to Norman Gayle and Donald Thornton, Vesta
and Gaines executives, will be deemed rejected on the later to
occur of the Effective Date or January 1, 2007.
A full-text copy of Vesta's Third Amended Plan of Liquidation is
available for free at http://ResearchArchives.com/t/s?17d9
Court Approves Modifications
The Hon. Thomas Bennett holds that the Second Amended Plan's
modifications, which are embodied in the Third Amended Plan, meet
the requirements of Sections 1127(a) and (c) of the Bankruptcy
Code. The Court rules that the modifications do not adversely
change the treatment of the Claim of any creditor or Shareholder
Interest of any equity security holder within the meaning of
Bankruptcy Rule 3019, and no further solicitation or voting is
required.
The Court rules that that each of the objections to the Plan that
have not been withdrawn, waived, or settled, are resolved by the
Confirmation Order or otherwise overruled on the merits.
Plan Satisfies 16 Steps Toward Confirmation
Judge Bennett finds that the Third Amended Plan satisfies the 16
statutory requirements necessary to confirm a plan pursuant to
Section 1129 of the Bankruptcy Code:
A. The Plan complies with the applicable provisions of Section
1129(a)(l), which encompasses the requirements of Sections
1122 and 1123 governing classification of claims and
interests and contents of the Plan.
In addition to the Administrative Claims and the Priority Tax
Claims, which need not be designated, the Plan designates
seven classes of Claims and Shareholder Interests. The Plan
also identifies the classes of impaired and unimpaired Claims.
Articles 3 to 5 of the Plan provides the treatment of all
classes of Claims and Shareholder Interests, including the
impaired class, in accordance with Sections 1123(3) and (4) of
the Bankruptcy Code.
Section 7.2 of the Plan provides that Vesta's Certificate of
Incorporation will be amended to, among other things, include
a provision prohibiting the issuance of non-voting equity
securities.
The appointment of the Plan Trustee to serve as the sole
officer and director of Vesta, with the existing officers and
directors deemed removed from their respective positions on
the Effective Date, is in the best interests of the creditors
and shareholders and is consistent with public policy.
B. Vesta, as the proponent of the Plan, has complied with the
applicable provisions of the Bankruptcy Code. Section
1129(a)(2) is satisfied.
C. The Plan has been proposed with the legitimate and honest
purpose of providing for an orderly liquidation and
distribution of the Estate Property to maximize the return to
the Debtor's creditors. The Plan was formulated and drafted
with the active participation of and arms' length negotiations
between the Debtor, VIG Committee, and other parties-in-
interest, and the Plan is supported by the VIG Committee.
Section 1129(a)(3) is satisfied.
D. Section 1129(a)(4) has been complied with. All payments made
or promised by the Debtor for services or for costs and
expenses, have been approved or are subject to approval of the
Court.
E. The identity, qualifications and affiliations of the
management of Vesta and of the assets of the Estate under the
Plan, after Plan confirmation, have been fully disclosed.
Lloyd Whitaker, as Plan Trustee, will serve as the sole
officer and director of Vesta. The retention of Mr. Whitaker,
and the corresponding retention agreement that adequately
discloses the compensation of the Plan Trustee, is approved.
Vesta has complied with Section 1129(a)(5).
F. Section 1129(a)(6) does not apply because the Debtor is a
holding company and does not establish rates subject to the
jurisdiction of any regulatory agency or commission.
G. The Plan satisfies Section 1129(a)(7). The evidence
introduced at the Confirmation Hearing is persuasive and
credible, has not been controverted by other evidence, and
establishes that each Holder of an impaired Claim or
Shareholder Interest either has accepted the Plan or will
receive or retain under the Plan, on account of its Claim or
Shareholder Interest, property of a value, as of the Effective
Date, that is not less than the amount that the Holder will
receive or retain if the Debtor was liquidated under Chapter 7
of the Bankruptcy Code.
H. The Plan has been accepted by the affirmative vote of the
requisite majorities, in number and amount, as applicable, of
Class C Senior Note/Debenture Claims and Class E General
Unsecured Claims. No ballots were received by the Voting
Agent from holders of Class D Junior Debenture Claims, and
there are no Class F Subordinated Claims. The number, but not
the amount, of the equity interests voted in Class G
Shareholder Interests satisfy the test for class acceptance.
Section 1129(a)(8) has not been satisfied, but, the Plan still
may be confirmed under Section 1129(b).
The firm Parker, Hudson, Rainer & Dobbs LLP, in Atlanta,
Georgia, was authorized to receive, analyze, and tabulate all
Ballots from each holder of a claim or interest in the voting
classes under the Plan. Tyronia M. Morrison, Esq., was
assigned to collect the Ballots on behalf of PHRD.
Ms. Morrison relates that one solicitation package was sent to
Class A holders; 256 to Class C; 20 to Class D; 87 to Class E;
and 4,148 to Class G.
PHRD received five master ballots for Class C totaling 59
votes. One of the master ballots was not counted because it
was a duplicate ballot.
Master Ballots Accept Reject Not Counted
-------------- ------ ------ -----------
The Northern Trust Co. 2 0 0
State Street Bank 1 0 0
Automatic Data Processing 50 2 2
The Bank of New York 1 0 1
Class C Votes Amount Percent
------- ----- ------ -------
Acceptances 54 $11,577,000 78.39%
Rejections 2 3,191,000 21.61%
In Class E, representing $573,156, only one out of 10 ballots
was not counted due to an unstated amount.
For Class G, representing $4,851,682, PHRD received two
ballots from holders of equity securities issued by the Debtor
and 13 master ballots for equity securities holders, together
totaling 289 votes. 223 voted to accept the Plan. Three of
the master ballots, with one vote each, were not counted
because they were duplicate ballots, Ms. Morrison says.
Ballots totaling 26 were also not counted since it did not
indicate acceptance or rejection of the Plan. The total
number of shares in Class G voting to accept the Plan was only
1.38% below the number required for class acceptance under
Section 1126(c).
I. The treatment of Administrative Claims and Priority Non-Tax
Claims under Sections 3.1 and 4.1 of the Plan satisfies the
requirements of Sections 1129(a)(9)(A) and (B), and the
treatment of Priority Tax Claims under Section 3.5 of the Plan
satisfies the requirements of Section 1129(a)(9)(C). There
are sufficient funds in the Estate to pay these Claims.
J. Class C, an impaired class, has accepted the Plan, determined
without including any acceptance of the Plan by any insider.
Section 1129(a)(10) is satisfied.
K. The Plan provides for the liquidation of all Estate property.
The evidence introduced at the Confirmation Hearing
establishes that Vesta, through the Plan Trustee, will be able
to perform its obligations under the Plan and that the Plan
offers a reasonable prospect of success. The Plan is
feasible, satisfying Section 1129(a)(11).
L. Article 3.4 of the Plan provides that all fees due to the
Bankruptcy Administrator will be paid, and there are
sufficient funds for Vesta to pay the fees. Section
1129(a)(12) is satisfied.
M. The Debtor did not provide any retiree benefits before the
Petition Date. Section 1129(a)(13) does not apply.
N. Sections 1129(a)(14) to (16) does not apply to the Plan.
O. With respect to Class D Junior Debenture Claims and Class G
Shareholder Interests, no Holders of Claims or Shareholder
Interests junior to the Holders of Class D and Class G will
receive or retain any property under the Plan on account of
the Claims or Shareholder Interests, unless and until Class D
and Class G have been paid in full.
As established by the uncontroverted evidence introduced at
the Confirmation Hearing, no class of Claims or Shareholder
Interests senior to Class D and Class G is receiving more than
full payment on account of the Claims or Shareholder
Interests. Therefore, the Plan is fair and equitable and does
not discriminate unfairly, as required by Section 1129(b).
Plan Provisions Approved
Judge Bennett rules that, except as otherwise provided in the
Plan, Vesta will continue to exist after the Effective Date as a
separate corporate legal entity, with all the powers of a
corporation under applicable law in the District of Delaware and
pursuant to the Certificate of Incorporation and Bylaws or other
organizational documents in effect before the Effective Date as
amended by the amended corporate document.
The stay in the Debtor's case pursuant to Sections 105 and 362(a)
will remain in full force and effect and will apply to the Debtor
and all Estate Property until all Estate Property has been
distributed and the Debtor has been dissolved, except as
otherwise provided in the Plan.
The Court also approves of the Debtor's execution and performance
of the access and services agreement and the clawback agreement.
The Plan Trustee will execute and deliver, and perform all of its
obligations under the Services Agreement and the Clawback
Agreement between Vesta, J. Gordon Gaines, Inc., and the
Receivership Estates -- Vesta Fire Insurance Corp., Vesta
Insurance Corp., Shelby Casualty Insurance Co., The Shelby
Insurance Co., Texas Select Lloyd's Insurance Co., and Select
Insurance Services, Inc. -- acting through Prime Tempus, Inc., as
the Special Deputy Receiver appointed to oversee the Receivership
Estates.
Gaines has agreed to provide Vesta and the Receivership Estates
post-confirmation access to various records prepared by Gaines
and various electronic information contained on the Gaines
computer system and to provide post-confirmation certain services
to Vesta and the Receivership Estates on the terms and conditions
of a Post-Confirmation Access and Services Agreement.
If consummation of the Plan does not occur, then the Plan, any
settlement or compromise embodied in the Plan, the assumption or
rejection of executory contracts or leases effected by the Plan,
and any document or agreement executed pursuant to the Plan will
be null and void, Judge Bennett declares.
On the Effective Date, the VIG Committee will dissolve and its
members, professionals, and agents will be released from any
further duties and responsibilities in Vesta's Chapter 11 case
and under the Bankruptcy Code, except with respect to:
-- obligations arising under the confidentiality agreements,
joint interest agreements, and protective orders entered
during the Case, which will remain in full force and
effect according to the terms;
-- applications for professional compensation;
-- requests for compensation and reimbursement of expenses
pursuant to Section 503(b) of the Bankruptcy Code for
making a substantial contribution in the Case; and
-- any motions or other actions seeking enforcement or
implementation of the provisions of the Plan or the
Order.
The Court approves the formation of the Plan Committee. The
Court also approves the assumption of executory contracts and
unexpired leases identified in the Plan.
The Debtor is authorized and directed to make all payments and
disbursements as contemplated by the Plan, including payments of
all allowed Indenture Trustee fees.
Judge Bennett rules that all persons who have held, hold or may
hold Claims against or Shareholder Interests in the Debtor are
permanently enjoined from:
(a) commencing or continuing, in any manner or in any place,
any action or other proceeding, other than actions or
proceedings commenced by a Governmental Unit to enforce
its police or regulatory authority over the Debtor to the
extent excepted from the automatic stay provisions of
Section 362, but not against Estate Property;
(b) enforcing, attaching, collecting or recovering in any
manner any judgment, award, decree or order;
(c) creating, perfecting or enforcing any Lien;
(d) asserting any setoff, right of subrogation or recoupment
of any kind against any debt, liability or obligation due
the Debtor; or
(e) commencing or continuing, in any manner or in any place,
any action that does not comply with or is inconsistent
with the provisions of the Plan.
A full-text copy of Vesta's Clawback Agreement can be accessed
for free at http://ResearchArchives.com/t/s?17da
A full-text copy of Vesta's Service Agreement can be accessed for
free at http://ResearchArchives.com/t/s?17db
A full text copy of Vesta's Amended Certificate of Incorporation
is available for free at http://ResearchArchives.com/t/s?17dc
A full-text copy of the Confirmation Order is available for free
at http://ResearchArchives.com/t/s?17dd
About Vesta Insurance
Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.
Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
Company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517). Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors. In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.
J. Gordon Gaines, Inc., is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers. The Company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts. In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.
On Aug. 1, 2006, the District Court of Travis County, Texas
entered the Order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc. (Vesta
Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
VESTA INSURANCE: Court Confirms Gaines' Third Amended Plan
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama
confirms J. Gordon Gaines, Inc.'s Third Amended Chapter 11 Plan of
Liquidation.
The Plan was effective as of Dec. 26, 2006.
The Third Amended Plan provides non-material modifications to
Gaines' Second Amended Plan. The Third Amended Plan also
provides that the employee-related agreements relating to Norman
Gayle and Donald Thornton, Vesta and Gaines executives, will be
deemed rejected on the later to occur of the Effective Date or
January 1, 2007. To satisfy one of the Special Deputy Receiver's
objections, the Plan provides these terms:
-- Members of the Plan Committee serve without compensation
but may be reimbursed for their reasonable out-of-pocket
expenses.
-- Post-Confirmation Professionals may be retained by the
Plan Committee in the ordinary course of business and
without prior approval of the Bankruptcy Court; provided,
however, that Post-Confirmation Professionals retained by
the Plan Committee will not be entitled to be compensated
from funds available in the Estate except for services
rendered in order to facilitate the Plan Committee's
discharge of its authority provided for in the Plan.
-- The Post-Confirmation Professionals will file with the
Bankruptcy Court their statements for services rendered
and expenses incurred, and the fees and expenses will be
subject to review and objection by any party-in-interest.
-- Any objection to the fees and expenses will be resolved
by the Bankruptcy Court, but the filing of any objection
will not operate to defer the payment of any the fees and
expenses.
A full-text copy of Gaines' Third Amended Plan of Liquidation is
available for free at http://ResearchArchives.com/t/s?17de
The Hon. Thomas Bennett rules that the modifications to the Plan
meet the requirements of Sections 1127(a) and (c) of the
Bankruptcy Code, and do not adversely change the treatment of the
Claim of any creditor or Shareholder Interest of any equity
security holder within the meaning of Bankruptcy Rule 3019, and no
further solicitation or voting is required.
The Special Deputy Receiver has withdrawn its objection to the
Plan.
The Court rules that each of the objections to the Plan, and all
reservations of rights included therein, that have not been
withdrawn, waived, or settled, are hereby resolved by the
Confirmation Order or otherwise overruled on the merits.
Steps to Confirmation Satisfied
Judge Bennett finds that the Third Amended Plan satisfies the 16
statutory requirements necessary to confirm a plan pursuant to
Section 1129 of the Bankruptcy Code:
A. The Plan complies with the applicable provisions of Section
1129(a)(l), which encompasses the requirements of Sections
1122 and 1123 governing classification of claims and
interests and contents of the Plan.
The Plan provides for the specific treatments of claims under
the impaired and unimpaired classes. Articles 3 through 5 of
the Plan also provide for the same treatment for each Claim or
Shareholder Interest within a particular class, unless the
holder agrees to a less favorable treatment of the Claim or
Shareholder Interest.
The Plan provides for adequate and proper means for its
implementation, satisfying Section 1123(a)(5). Section 7.2 of
the Plan provides that the Certificate of Incorporation will
be amended to include a provision prohibiting the issuance of
non-voting equity securities, thus satisfying Section
1123(a)(6).
The Plan Trustee will serve as the sole officer and director
of the Debtor, and the existing officers and directors will be
deemed removed from their respective positions on the
Effective Date. The Plan complies with Section 1123(a)(7).
The provisions of the Plan are appropriate and consistent with
the applicable provisions of the Bankruptcy Code; Section
1123(b) is satisfied.
B. The Debtor, as the proponent of the Plan, has complied with
the applicable provisions of the Bankruptcy Code. Section
1129(a)(2) is satisfied.
C. The Plan satisfies Section 1129(a)(3). The Plan has been
proposed in good faith and not by any means forbidden by law.
The Plan has been proposed with the legitimate and honest
purpose of providing for an orderly liquidation and
distribution of the estate property to maximize the return to
the Debtor's creditors. The Plan was formulated and drafted
with the active participation of and arm's-length negotiations
between the Debtor and its Official Committee of Unsecured
Creditors, and the Plan is supported by the Committee.
D. The Plan complies with Section 1129(a)(4). All payments made
or promised by the Debtor have been approved or, if to be
fixed after Plan confirmation, will be subject to the Court's
approval to the extent required by the Plan.
E. The identity, qualifications and affiliations of the
management of the Debtor and of the assets of the Estate under
the Plan, after Plan confirmation, have been fully disclosed.
Kevin O'Halloran will serve as the Plan Trustee, and as the
sole officer and director of Gaines, on the Effective Date.
The identity of any insider that will be employed or retained
by the Plan Trustee or Gaines and the nature of compensation
also has been disclosed. Section 1129(a)(5) is satisfied.
F. There is no regulatory agency or commission with jurisdiction
over the Debtor's rates. Section 1129(a)(6) does not apply.
G. The Plan satisfies Section 1129(a)(7). Each Holder of an
impaired Claim or Shareholder Interest has either accepted the
Plan or will receive under the Plan, on account of the Claim
or Shareholder Interest, property of a value, as of the
Effective Date, that is not less than the amount that the
Holder will receive under a Chapter 7 liquidation.
H. Section 1128(a)(8) has not been satisfied, but the Plan may
still be confirmed under Section 1129(b).
Vesta Fire Insurance Corporation, through the Special Deputy
Receiver, had applied to the Court to allow its Claim for
voting purposes. Accordingly, the Special Deputy Receiver has
withdrawn its vote rejecting the Plan as a Class C member,
therefore, the Plan has been accepted by the affirmative vote
of the requisite majorities, in number and amount, by the
Class C Holders. The Voting Agent received no ballot from the
one holder of equity interests in Class E.
I. The treatment of Administrative Claims and Priority Non-Tax
Claims under Sections 3.1 and 4.1 of the Plan satisfies the
requirements of Sections 1129(a)(9)(A) and (B)of the
Bankruptcy Code, and the treatment of Priority Tax Claims
under Section 3.5 of the Plan satisfies the requirements of
Section 1129(a)(9)(C) of the Bankruptcy Code.
J. At least one class of Claims against the Debtor that is
impaired under the Plan has accepted the Plan, determined
without including any acceptance of the Plan by any insider,
thus satisfying the requirements of Section 1129(a)(10).
K. The Plan provides for the liquidation of all Estate Property.
The evidence introduced at the Confirmation Hearing is
persuasive and credible, has not been controverted by other
evidence, and establishes that the Debtor, through the Plan
Trustee, will be able to perform its obligations under the
Plan and that the Plan offers a reasonable prospect of
success. Accordingly, the Plan is feasible, and Section
1129(a)(11) of the Bankruptcy Code is satisfied.
L. Section 1129(a)(12) has been satisfied. Article 3.4 of the
Plan provides that all fees due the Bankruptcy Administrator
will be paid, and there are sufficient funds for the Debtor to
pay these fees.
M. Section 1129(a)(13) does not apply. By Order entered on
October 10, 2006, the Court authorized the Debtor to terminate
its only retiree benefits plan, and, therefore, the Debtor is
not obligated to provide any retiree benefits.
N. Sections 1129(a)(14), (15) and (16) do not apply to the Plan.
O. The Plan is fair and equitable and does not discriminate
unfairly, as required by Section 1129(b).
With respect to Class C, no Holders of Claims or Shareholder
Interests junior to the Holders of Class C General Unsecured
Claims will receive or retain any property under the Plan on
account of the Claims or Shareholder Interests, unless and
until the Class C General Unsecured Claims have been paid in
full, and, as established by the uncontroverted evidence
introduced at the Confirmation Hearing, no class of Claims or
Shareholder Interests senior to Class C is receiving more than
full payment on account of the Claims or Shareholder
Interests.
The Court approves the appointment of Mr. O'Halloran as Plan
Trustee and Gaines' execution and performance of the retention
agreement.
Judge Bennett approves of the access and services agreement, and
clawback agreement among Gaines; Vesta Insurance Group, Inc.; and
the receivership estates of Vesta Fire, Vesta Insurance Corp.,
Shelby Casualty Insurance Co., The Shelby Insurance Co., Texas
Select Lloyd's Insurance Co., and Select Insurance Services,
Inc., acting through the Special Deputy Receiver, Prime Tempus,
Inc.
Vesta and the Receivership Estates each has requested Gaines to
provide post-confirmation access to various records prepared by
Gaines and various electronic information contained on the Gaines
computer system and to provide post-confirmation certain services
to Vesta and the Receivership Estates, and Gaines has agreed to
provide access and the services on the terms and conditions of
the Access Agreement.
On the Effective Date, Gaines' Official Committee of Unsecured
Creditors will dissolve automatically. The Court approves the
formation, on the Effective Date, of the Plan Committee with its
duties, rights and obligations limited to those specifically
enumerated in the Plan.
A full-text copy of the Confirmation Order is available for free
at http://ResearchArchives.com/t/s?17df
About Vesta Insurance
Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.
Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
Company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517). Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors. In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.
J. Gordon Gaines, Inc., is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers. The Company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts. In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.
On Aug. 1, 2006, the District Court of Travis County, Texas
entered the Order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc. (Vesta
Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
WINSTAR COMMS: Wants to Reclaim Proceeds of Escrowed Accounts
-------------------------------------------------------------
Winstar Holdings LLC asks authority from the U.S. Bankruptcy Court
for the District of Delaware to obtain proceeds of escrowed
amounts relating to:
(a) a dispute with Nextel Communications, Inc.; and
(b) leases for the premises located at:
* 600 West Broadway, in San Diego, California; and
* 2001 6th Avenue, in Seattle, Washington.
David Albalah, Esq., at Bracewell & Giuliani LLP, in New York,
says that although Winstar believes it can recover the amounts
without the Court's authorization, it is asking for permission as
a precautionary measure.
Mr. Albalah relates that Winstar has not received any cure
notices with respect to the Properties or the Nextel Dispute. He
notes that these are the aggregate approximate amounts with
respect:
Escrow Account Amount
-------------- -------
The San Diego Property $90,551
The Seattle Property 4,656
The Nextel Dispute 45,000
With regards the San Diego Property, Winstar contacted the
landlord and his counsel, and learned that the Property has been
sold twice since the December 2001 Asset Purchase Agreement with
the Debtors. Winstar has not received any responses to its
inquiries from the current and previous landlords of any claims
they may have against the San Diego Escrow, Mr. Albalah says.
The lease with regards the Seattle Property, on the other hand,
was terminated in February 2005 pursuant to a termination
agreement with Winstar Communications LLC. Under the Termination
Agreement, Winstar agreed to perform delineated work to the
premises, Mr. Albalah informs the Court. Sixth & Virginia, the
Seattle landlord, informed Winstar that it was owed $2,695 for
work performed in accordance with the Agreement. Mr. Albalah
deduces it was unclear to the Seattle landlord whether the work
performed was even contemplated and covered by the Termination
Agreement.
Mr. Albalah says the Termination Agreement's terms:
* bear no relation to the Seattle Escrow and cannot offset
for any amounts purportedly owed;
* do not make any reference to or even contemplate the
Seattle Escrow; and
* do not grant for the cost of repairs because the Seattle
Escrow was created to provide for rent disputes arising
from Winstar's assumption of the Seattle Property.
Mr. Albalah asserts that the proceeds of the Seattle Escrow
should be returned to Winstar because the Seattle Landlord has
not communicated or attempted to recover it.
The Nextel Dispute involved a disagreement between Nextel and
Winstar on phone usage charges before Winstar established its own
account in 2002, Mr. Albalah continues. He adds that at that
time, Winstar paid Nextel the undisputed portion of the amounts
owed and created the Nextel Escrow as a good faith gesture to
reach a compromise with the remaining balance.
Mr. Albalah argues that the proceeds of the Nextel Escrow should
be returned to Winstar because:
* since 2002, Winstar has not received communications from
Nextel as to whether Nextel intends to, or has a right to,
assert any claims against the Nextel Escrow; and
* Winstar believes it does not owe Nextel any of the amounts
held in the Nextel Escrow.
About Winstar Communications
Headquartered in New York, New York, Winstar Communications, Inc.,
provides broadband services to business customers. The company
and its debtor-affiliates filed for chapter 11 protection on April
18, 2001 (Bankr. D. Del. Case Nos. 01-01430 through
01-01462). The Debtors obtained the court's approval converting
their case to a chapter 7 liquidation proceeding in January 2002.
Christine C. Shubert serves as the Debtors' chapter 7 trustee.
When the Debtors filed for bankruptcy, they listed $4,975,437,068
in total assets and $4,994,467,530 in total debts. (Winstar
Bankruptcy News, Issue No. 76; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
WOODWIND & BRASSWIND: Court Approves $25 Million LaSalle Financing
------------------------------------------------------------------
The Hon. Harry C. Dees, Jr., of the U.S. Bankruptcy Court for the
Northern District of Indiana approved on Dec. 29, 2006, Dennis
Bamber Inc. dba The Woodwind & the Brasswind's request to obtain a
$25 million debtor-in-possession financing from LaSalle Bank, the
Boston Business Journal reports. LaSalle is the Debtor's senior
lender and is still owed $22 million.
The financing comes as the Debtor prepares to auction its business
on Jan. 24, 2007, the Boston Business Journal relates.
As reported in the Troubled Company Reporter on Dec. 21, 2006,
Steinway Musical Instruments, Inc. has been named the lead bidder
in the auction.
Headquartered in South Bend, Indiana, The Woodwind & the Brasswind
-- http://www.wwbw.com/-- sells musical instruments and
accessories. The Company filed for chapter 11 protection on
Nov. 24, 2006 (Bankr. N.D. Ind. Case No. 06-31800). Chad H.
Gettleman, Esq., Henry B. Merens, Howard L. Adelman, Esq., and
Nathan Q. Rugg, Esq., at Adelman, Gettleman, Ltd., represent the
Debtor in its restructuring efforts. The Official Committee of
Unsecured Creditors appointed in the Debtors' cases has selected
James M. Carr, Esq., at Baker & Daniels LLP as its counsel. When
the Debtor filed for protection from its creditors, they estimated
assets and debts between $1 million and $100 million.
* Law Firms Arent Fox and O'Brien Abeles Merges
-----------------------------------------------
Arent Fox and Los Angeles-based O'Brien Abeles combined their
firms on Jan. 1, 2007.
The merger is spurred, in part, by the firms' common client
relationships as well as by Arent Fox clients expressing a desire
for the firm to have a West Coast presence.
"We have been searching for a merger candidate in LA with an
excellence and culture that is compatible with ours," said Marc
Fleischaker, chairman of Arent Fox. "The quality of the lawyering
at O'Brien Abeles, their outstanding ethics, and the commitment
they have demonstrated to both their clients and the individuals
in the firm convinced us that this would be a successful merger.
We are ecstatic about this combination and look forward to
significant growth in California."
"Arent Fox has a terrific reputation as a leading firm with
seasoned lawyers," Robert O'Brien, the founding partner at O'Brien
Abeles, echoed Fleischaker's comments. "After getting to know the
principals of the firm, we are excited by the potential. This is
a win-win situation."
"Our clients have always come first," said Jerry Abeles, an
O'Brien Abeles partner. "But this merger will only increase our
responsiveness and allow us to expand our menu of services."
The Los Angeles office will see immediate growth with the addition
of four lawyers to O'Brien Abeles's current roster of nine.
Ambassador Pierre-Richard Prosper, former U.S. ambassador-at-
large, joined Arent Fox LLP on Jan. 1, 2007. While with the State
Department, Ambassador Prosper was a presidential adviser who
formulated U.S. policy responses to atrocities, conflicts and the
War on Terror; additionally, he managed and coordinated the U.S.
interagency and U.S. embassies on policy. In addition to his
focus on the firm's international practice in areas such as trade
regulation, intellectual property protection and arbitration,
Ambassador Prosper, who served as an assistant U.S. attorney in
Los Angeles before joining the State Department, will counsel
corporate clients on internal investigations and compliance
issues.
Also joining the newly merged firm will be Steven Bledsoe. Mr.
Bledsoe, formerly a share partner with Kirkland & Ellis's LA
office, represents clients from a variety of industries in high-
stakes litigation matters. His arrival will add further depth to
a litigation team that includes Mr. O'Brien, Mr. Abeles, and well-
known entertainment and IP litigator Bela Lugosi Jr.
Two current Arent Fox partners, Wayne Matelski and Michael Cryan,
complete the foursome. Mr. Matelski is a Washington partner who
co-chairs the firm's regulatory department and is the senior
pharmaceutical and medical device attorney in Arent Fox's food and
drug practice. Mr. Cryan, a litigator whose practice focuses on
intellectual property and general business, is relocating from the
New York office.
Arent Fox is a full-service law firm with offices in Washington,
DC, and New York. O'Brien Abeles -- which focuses on litigation
and counseling for a variety of industries, including media and
entertainment -- is based in Los Angeles.
About Arent Fox
Arent Fox -- a dynamic, diversified law firm with 26 practice
groups -- is a recognized leader in areas including intellectual
property, real estate, health care, life sciences and litigation.
With more than 300 lawyers, Arent Fox has a wide range of
expertise in corporate securities and transactions, financial
restructuring and bankruptcy, government relations and regulation,
labor and employment, finance, tax, corporate compliance and the
global business market. The firm provides services to Fortune 500
companies, government agencies, trade associations, foreign
governments, long-term care facilities, start-up companies and
other entities.
About O'Brien Abeles
Founded in 1999 as a litigation boutique, O'Brien Abeles serves
national and international corporations and individuals throughout
California and the nation. The firm has developed a reputation
for obtaining significant legal victories for its clients in
complex intellectual property, entertainment and commercial
litigation and international arbitration matters.
* S. Wickouski Named One of 2005 Outstanding Restructuring Lawyers
------------------------------------------------------------------
M. Stephanie Wickouski, Co-Chair of the Corporate Restructuring
and Financial Institutions Practice Group of Gardner Carton &
Douglas LLP and Managing Partner of the firm's New York office,
has been selected among the "Outstanding Restructuring Lawyers -
2006" by Turnarounds & Workouts, a nationally prominent bi-monthly
newsletter for professionals tracking distressed businesses in the
United States and Canada.
Ms. Wickouski is cited by Turnarounds & Workouts for her counsel
to indenture trustees in the following notable bankruptcies of
Northwest Airlines FLYi, Mirant Generation, Loral Space, and WHX
Corp. and Tower Automotive. It also notes Ms. Wickouski's service
as counsel to the largest creditors in the UAL bankruptcy and her
authorship of the definitive treatise, Bankruptcy Crimes, which
will be published in early 2007.
Ms. Wickouski is currently Managing Partner of the New York City
office and Co-Chair of the firm's Corporate Restructuring and
Financial Institutions Practice Group. Ms. Wickouski has more
than 20 years of experience in complex reorganization cases before
federal bankruptcy courts throughout the country, and in
counseling clients on all aspects of credit and financial
relationships. In 2004, Ms. Wickouski was recognized as one of
the best bankruptcy lawyers in Washington, DC by Washingtonian
magazine and by The Best Lawyers in America.
In addition to her upcoming publication, Bankruptcy Crimes, she
also has a national reputation in health care insolvency and is a
frequent lecturer, author and commentator on bankruptcy subjects.
Her articles have appeared in The National Law Journal, ABA
Litigation Magazine, Legal Times, Washington Business Journal and
official publications of the District of Columbia, New Jersey, and
Pennsylvania State Bar Associations. She is a frequent
commentator in The Washington Post on bankruptcy issues, and has
appeared on national television in connection with recent high-
profile bankruptcy cases. Ms. Wickouski has taught creditors'
rights at the Catholic University School of Law and was formerly a
law clerk to the Hon. Roger M. Whelan, former U.S. Bankruptcy
Judge for the District of Columbia.
About Gardner Carton
Founded nearly 100 years ago, Gardner Carton & Douglas LLP is a
leading national law firm with offices in Chicago, Washington, DC,
New York, Milwaukee and Albany. The firm has more than 200
lawyers and advisors practicing in corporate law, corporate
restructuring, customs and international trade, government
relations, health law, HR law (employee benefits and employment),
intellectual property, litigation and dispute resolution, real
estate and environmental law, and wealth planning and
philanthropy. GCD is the byinvitation firm representing Chicago
in the World Law Group, a global consortium of firms in large
cities worldwide, and the Midwest home of the MIT Enterprise
Forum, a nationwide volunteer organization that promotes world-
class business innovation. On Jan. 1, 2007, the firm merged with
Drinker Biddle & Reath LLP to form one of the 70 largest US law
firms, with more than 650 attorneys practicing in eight states
nationwide.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
January 11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Lender's Panel
University Club, Jacksonville, FL
Contact: http://www.turnaround.org/
January 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Lender's Panel Breakfast
Westin Buckhead, Atlanta, GA
Contact: http://www.turnaround.org/
January 17, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
January 17-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Distressed Investing Conference
Wynn, Las Vegas, NV
Contact: http://www.turnaround.org/
January 19-21, 2007
AMERICAN BANKRUPTCY INSTITUTE
3rd Annual Corporate Restructuring Competition
Kellogg School of Management, Chicago, IL
Contact: http://www.abiworld.org/
January 23, 2007
TURNAROUND MANAGEMENT ASSOCIATION
2007 Outlook on Healthcare Restructuring
Center Club, Baltmore, MD
Contact: http://www.turnaround.org/
January 24, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Year 2007 Kick-Off Party
Oak Hill Country Club, Rochester, NY
Contact: 716-440-6615 or http://www.turnaround.org/
January 25-27, 2007
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Hyatt Regency, Denver, CO
Contact: 1-703-739-0800 or http://www.abiworld.org/
January 29, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Men's College Basketball & Networking
Wachovia Center, Philadelphia, PA
Contact: 215-657-5551 or http://www.turnaround.org/
January 30-31, 2007
EUROMONEY INSTITUTIONAL INVESTOR
Korea Securitisation and Structured Credit Summit
JW Marriott Hotel, Seoul, South Korea
Contact: http://www.euromoneyplc.com/
January 31 to February 1, 2007
EUROMONEY INSTITUTIONAL INVESTOR
Asia M&A Forum
Island Shangi-La, Hong Kong
Contact: http://www.euromoneyplc.com/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800 or http://www.abiworld.org/
February 5, 2007
STRATEGIC RESEARCH INSTITUTE
3rd Annual Tranche B & 2nd Lien Financing Summit
Scottsdale, AZ
Contact: http://www.euromoneyplc.com/
February 8-9, 2007
EUROMONEY CONFERENCES
2nd Philippine Investment Conference
Cebu Convention Center, Cebu, Philippines
Contact: http://www.euromoneyplc.com/
February 8-9, 2007
EUROMONEY
Leverage Finance Asia
JW Marriott Hong Kong
Contact: http://www.euromoneyplc.com/
February 8-11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Certified Turnaround Professional (CTP) Training
NY/NJ
Contact: http://www.turnaround.org/
February 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Men's College Basketball & Networking
Wachovia Center, Philadelphia, PA
Contact: 215-657-5551 or http://www.turnaround.org/
February 16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Wharton Restructuring Conference
The Wharton School
Philadelphia, PA
Contact: http://www.turnaround.org/
February 21-22, 2007
EUROMONEY
Euromoney Pakistan Conference
Perceptions & Realities
Marriott Hotel, Islamabad, Pakistan
Contact: http://www.euromoneyplc.com/
February 22, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA PowerPlay - Atlanta Thrashers
Philips Arena, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
February 22, 2007
EUROMONEY
2nd Annual Euromoney Japan Forex Forum
Mandarin Oriental, Tokyo, Japan
Contact: http://www.euromoneyplc.com/
February 25-26, 2007
NORTON INSTITUTES
Norton Bankruptcy Litigation Institute
Marriott Park City, UT
Contact: http://www2.nortoninstitutes.org/
February 27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Devil Rays Turnaround
Centre Club, Tampa, FL
Contact: http://www.turnaround.org/
February 27-28, 2007
EUROMONEY INSTITUTIONAL INVESTOR
5th Annual Corporate Restructuring Summit
Sheraton Park Lane Hotel, London, UK
Contact: http://www.euromoneyplc.com/
March 1, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - West
Regency Beverly Wilshire, Los Angeles, CA
Contact: http://www.abiworld.org/
March 2, 2007
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Bankruptcy Battleground West
Regency Beverly Wilshire, Los Angeles, CA
Contact: http://www.abiworld.org/
March 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Martini Madness Cocktail Reception with Geraldine Ferraro
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
March 15-18, 2007
NATIONAL ASSOCIATION OF BANKRUTPCY TRUSTEES
NABT Spring Seminar
Ritz-Carlton Buckhead, Atlanta, GA
Contact: http://www.NABT.com/
March 18-21, 2007
INSOL
Annual Europe, Africa & Middle East Conference
Cape Town, South Africa
Contact: http://www.insol.org/CapeTown07/
March 21, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
March 21-22, 2007
EUROMONEY
2nd Annual Vietnam Investment Forum
Melia, Hanoi, Vietnam
Contact: http://www.euromoneyplc.com/
March 21-22, 2007
EUROMONEY
Euromoney Indian Financial Market Congress
Grand Hyatt, Mumbai, India
Contact: http://www.euromoneyplc.com/
March 22-23, 2007
EUROMONEY INSTITUTIONAL INVESTOR
Euromoney Indonesian Financial Markets Congress
Bali, Indonesia
Contact: http://www.euromoneyplc.com/
March 27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
"The Six Keys of Sustained Profitable Growth"
Rodney Page, Senior Partner of Blue Springs Partners
Citrus Club, Orlando, FL
Contact: http://www.turnaround.org/
March 27-31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Spring Conference
Four Seasons Las Colinas, Dallas, Texas
Contact: http://www.turnaround.org/
March 29-31, 2007
ALI-ABA
Chapter 11 Business Reorganizations
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 11-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
ABI Annual Spring Meeting
J.W. Marriott, Washington, DC
Contact: 1-703-739-0800; http://www.abiworld.org/
April 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or http://www.turnaround.org/
April 12, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - East
JW Marriott, Washington, DC
Contact: http://www.abiworld.org/
April 20, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast meeting with Chapter President, Bruce Sim
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
April 24, 2007
TURNAROUND MANAGEMENT ASSOCIATION
"Why Prospects Become Clients"
Mark Fitzgerald, President of Sales Training Institute Inc
Centre Club, Tampa, FL
Contact: http://www.turnaround.org/
April 26-27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
1st Annual Credit & Bankruptcy Symposium
Mohegan Sun, Uncasville, CT
Contact: http://www.turnaround.org/
April 26-28, 2007
ALI-ABA
Fundamentals of Bankruptcy Law
Philadelphia, PA
Contact: http://www.ali-aba.org
April 29 - May 1, 2007
INTERNATIONAL BAR ASSOCIATION
International Insolvency Conference
Zurich, Switzerland
Contact: http://www.ibanet.org/
May 4, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - NYC
Alexander Hamilton US Custom House, SDNY
New York, NY
Contact: http://www.abiworld.org/
May 7, 2007
AMERICAN BANKRUPTCY INSTITUTE
9th Annual New York City Bankruptcy Conference
Millennium Broadway Hotel & Conference Center
New York, NY
Contact: http://www.abiworld.org/
May 14, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual TMA Atlanta Golf Outing
White Columns, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
May 16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
June 6-8, 2007
TURNAROUND MANAGEMENT ASSOCIATION
5th Annual Mid-Atlantic Regional Symposium
Borgata Hotel Casino & Spa, Atlantic City, NJ
Contact: http://www.turnaround.org/
June 6-9, 2007
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
23rd Annual Bankruptcy & Restructuring Conference
Westin River North, Chicago, Illinois
Contact: http://www.airacira.org/
June 14-17, 2007
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
June 28 - July 1, 2007
NORTON INSTITUTES
Norton Bankruptcy Litigation Institute
Jackson Lake Lodge, Jackson Hole, WY
Contact: http://www2.nortoninstitutes.org/
July 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or www.turnaround.org
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, RI
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
July 25-28, 2007
AMERICAN BANKRUPTCY INSTITUTE
12th Annual Southeast Bankruptcy Workshop
The Sanctuary, Kiawah Island, SC
Contact: http://www.abiworld.org/
August 9-11, 2007
AMERICAN BANKRUPTCY INSTITUTE
3rd Annual Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay
Cambridge, MD
Contact: http://www.abiworld.org/
September 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Southwest Bankruptcy Conference
Four Seasons
Las Vegas, NV
Contact: http://www.abiworld.org/
September 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or http://www.turnaround.org/
October 16-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
October 30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, FL
Contact: 561-882-1331 or http://www.turnaround.org/
December 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Westin Mission Hills Resort, Rancho Mirage, California
Contact: 1-703-739-0800; http://www.abiworld.org/
December 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
TBA 2008
INSOL
Annual Pan Pacific Rim Conference
Shanghai, China
Contact: http://www.insol.org/
January 10, 2008
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
April 3-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
26th Annual Spring Meeting
The Renaissance, Washington, DC
Contact: http://www.abiworld.org/
June 4-7, 2008
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
24th Annual Bankruptcy & Restructuring Conference
JW Marriott Spa and Resort, Las Vegas, NV
Contact: http://www.airacira.org/
June 12-14, 2008
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, MI
Contact: http://www.abiworld.org/
August 16-19, 2008
AMERICAN BANKRUPTCY INSTITUTE
13th Annual Southeast Bankruptcy Workshop
Ritz-Carlton, Amelia Island, FL
Contact: http://www.abiworld.org/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
October 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
December 4-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
20th Annual Winter Leadership Conference
Westin La Paloma Resort & Spa
Tucson, AZ
Contact: http://www.abiworld.org/
June 21-24, 2009
INSOL
8th International World Congress
TBA
Contact: http://www.insol.org/
October 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, Nevada
Contact: http://www.ncbj.org/
October 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
BEARD AUDIO CONFERENCES
Coming Changes in Small Business Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Real Estate under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changes to Cross-Border Insolvencies
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Healthcare Bankruptcy Reforms
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Calpine's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changing Roles & Responsibilities of Creditors' Committees
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Validating Distressed Security Portfolios: Year-End Price
Validation and Risk Assessment
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Employee Benefits and Executive Compensation
under the New Code
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Dana's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Reverse Mergers - the New IPO?
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Privacy Rights, Protections & Pitfalls in Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
BEARD AUDIO CONFERENCES
When Tenants File -- A Landlord's BAPCPA Survival Guide
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Clash of the Titans -- Bankruptcy vs. IP Rights
Contact: http://www.beardaudioconferences.com
240-629-3300
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
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., Frederick, Maryland,
USA. Marie Therese V. Profetana, Robert Max Victor M. Quiblat II,
Shimero R. Jainga, Joel Anthony G. Lopez, Melvin C. Tabao, Rizande
B. Delos Santos, Cherry A. Soriano-Baaclo, Ronald C. Sy, Jason A.
Nieva, Lucilo M. Pinili, Jr., Tara Marie A. Martin, and Peter A.
Chapman, Editors.
Copyright 2007. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
*** End of Transmission ***