/raid1/www/Hosts/bankrupt/TCR_Public/070111.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, January 11, 2007, Vol. 11, No. 9
Headlines
ADVANCED MARKETING: Court Gives Interim Nod on Cash Collateral Use
AEGIS ASSET: Moody's Puts Ba2 Rating on Review and May Downgrade
AJAY SPORTS: Has Interim Access to Comerica's Cash Collateral
AMERICAN MOULDING: Disclosure Statement Hearing Slated for Jan. 31
AMERIQUEST MORTGAGE: Fitch Takes Actions on Various Debentures
AMERIQUEST MORTGAGE: S&P Cuts Ratings on Four Certificate Classes
ARAMARK CORP: S&P Pares Corporate Credit Rating to B+ from BB+
ASARCO LLC: Brings-In LECG LLC as Environmental Consultant
ASARCO LLC: Court Approves TMD & Nord Settlement Agreement
AT HOLDINGS: $695MM Eaton Corp. Deal Cues Moody's Ratings Review
ATSI COMM: Posts $184,000 Net Loss in First Quarter Ended Oct. 31
BEAR STEARNS: Moody's Rates Class I-B-3 Certificates at Ba2
BEAR STEARNS: Moody's Rates Class II-B-5 Certificates at Ba1
BOWNE & CO: Moody's Holds Corporate Family Rating at Ba3
CARROLS CORP: S&P Holds Corporate Credit Rating at B+
COLLINS & AIKMAN: Wants Plan-Filing Period Extended to May 14
CROWN CASTLE: Global Signal Stockholders Vote on Form of Merger
DANA CORP: Court OKs Trailer Axles Amended APA with Hendrickson
DANA CORP: Wants Warehouse Services Agreement with AMI Approved
DELPHI CORP: Highland Proposes Alternative Framework Agreements
DELPHI CORP: Judge Drain Approves Claims Estimation Procedures
DELTA AIR: US Airways Ups Offer to $10.2 Billion
DELTA AIR: Claimholders Want US Airway's Revised Offer Considered
DELTA AIR: S&P Says US Airway's New Offer Won't Affect Ratings
DEUTSCHE ALT-A: S&P Pares Rating on Class M-3 Debt to B from BB
DURA AUTOMOTIVE: Panel Wants Information Access Protocol Okayed
EASTPORT GOLF: Case Summary & 20 Largest Unsecured Creditors
EATZIS LLC: Assigns All Assets to Neligan Foley for Liquidation
EMPLOYEES' BENEFIT: Case Summary & 5 Largest Unsecured Creditors
FINAL ANALYSIS: Selects Whiteford Taylor as Attorneys
FINAL ANALYSIS: Proofs of Claims Must be Submitted by May 7
FIRST HORIZON: Fitch Holds Low-B Ratings on Two Cert. Classes
FORD MOTOR: To Invest $866 Million in Six Michigan Plants
FREMONT HOME: S&P Holds Rating on Class B-2 Debenture at BB+
GLOBAL LEVERAGED: Moody's Rates $25 Million Class I Notes at B2
GOODYEAR TIRE: Workers' Strike Could Result in $350 Million Loss
GOLD KIST INC: Posts $17.7 Million Net Loss in Year Ended Sept. 30
GP INVESTMENTS: Fitch Rates $150 Million Notes at B
GRANITE BROADCASTING: Can Access $25 Mil. DIP Financing from SPCP
GRANITE BROADCASTING: Court Gives Final Nod on Cash Collateral Use
GREGORY ROSE: Case Summary & 20 Largest Unsecured Creditors
GORDON CRAWFORD: Case Summary & Six Largest Unsecured Creditors
HANOVER COMPRESSOR: Completes Partial Redemption of $20.8MM Notes
HEADWATERS INC: Seeking to Amend Senior Secured Credit Agreement
IMC INVESTMENT: Files Amended Disclosure Statement on Ch. 11 Plan
INTERNAL INTELLIGENCE: Taps Weiser LLP as Financial Advisor
ISTAR FINANCIAL: Gets Required Consents to Amend Note Indentures
JEAN COUTU: Earns $72.5 Million in 2007 Fiscal Second Quarter
KINDER MORGAN: S&P Cuts Rating on $10 Million Certificates to BB-
L&T DEVELOPMENT: Case Summary & 2 Largest Unsecured Creditors
LIGAND PHARMA: Amends Purchase Pact with King Pharmaceuticals
LORRAINE MOWAD: Case Summary & Nine Largest Unsecured Creditors
MALDEN MILLS: Case Summary & 30 Largest Unsecured Creditors
MALDEN MILLS: Sells Assets to Gordon Brothers Under Chapter 11
MCKESSON CORP: Directors Vote to Declassify Board
MICHAEL WILSON: Voluntary Chapter 11 Case Summary
MICRON TECH: S&P Lifts Corporate Credit Rating to BB- from B+
MILLS CORP: Shares Rise to Close at $15.47/Share Despite Warning
MILLS CORP: Will Pay Bonuses to CEO and CFO Under Performance Plan
MILLS CORP: Inks Term Sheet With Mills LP & Kan Am on Co-Ventures
MOOG INC: S&P Lifts Corporate Credit Rating to BB+ from BB
NEFF CORP: Good Performance Prompts S&P's Stable Outlook
NEXIA HOLDINGS: Posts $1.2 Mil. Net Loss in Quarter Ended Sept. 30
NICHOLAS-APPLEGATE: Moody's Junks Rating on $10 Mil. Class D Notes
NRG ENERGY: Repays $400 Million of Term Loan B Facility
OWENS CORNING: Files Amended Registration Statement with the SEC
OWENS CORNING: Wants Insurance Companies' Claims Disallowed
PENTON MEDIA: Will Amend 11-7/8% Senior Secured Notes Offering
PILGRIM'S PRIDE: Gets Tenders for 92% of Gold Kist Common Stock
PIMA COUNTY: S&P Lowers Rating on Revenue Bonds to BB from BB+
PINNACLE ENT: Awards $1.5 Million in Bonuses to Four Executives
PRESERVE AT WOODLAND: Michigan Property Auction is January 29
RACHEL GREGG: Case Summary & 20 Largest Unsecured Creditors
RADNOR HOLDINGS: Court Extends Removal Period to February 19
RADNOR HOLDINGS: Has Until March 19 to Decide on Leases
REDPRAIRIE CORP: S&P Holds Corporate Credit Rating at B
RELIABILITY INC: Posts $396,000 Net Loss in 2006 Third Quarter
RESOURCE AMERICA: Earns $19.9 Million for the Year Ended Sept. 30
RITE AID: Glass Lewis et. al Approves Brooks & Eckerd Acquisition
ROGER AGUINAGA: Case Summary & 11 Largest Unsecured Creditors
SANKATY HIGH: Fitch Holds Low-B Rating on $33.5 Million Notes
SECURITY AVIATION: Hires Christianson & Spraker as Counsel
SECURITY AVIATION: Meeting of Creditors Scheduled Today
SEWER ENTERPRISES: Case Summary & Two Largest Unsecured Creditors
SOLUTIA INC: Selling 482-Acre Property to Shintech for $7.1 Mil.
SOLUTIA INC: Projects Rise in Earnings 5 Years After Bankr. Exit
SONTRA MEDICAL: Nasdaq Suspends Common Stock Quotation
STAGE ONE: Voluntary Chapter 11 Case Summary
STRUCTURED ASSET: Moody's Rates Class B1 Certificates at Ba1
SUNCOM WIRELESS: Board Okays Termination of Compensation Plan
SUSAN GREENFIELD: Case Summary & 15 Largest Unsecured Creditors
TERRY ALBERTSEN: Case Summary & 18 Largest Unsecured Creditors
TERWIN MORTGAGE: Losses Prompt Moody's Possible Ratings Downgrade
THERMADYNE HOLDINGS: To Record Impairment Charge on Divestitures
UAP HOLDING: Posts $13.1 Mil. Net Loss in Quarter Ended Nov. 26
US AIRWAYS: Ups Offer for Delta Air to $10.2 Billion
US AIRWAYS: S&P Retains Dev. Watch Despite Revised Delta Offer
USG CORPORATION: IINA Objects to Assume All Contacts Proposal
USG CORPORATION: Court Okays Modification to Discharge Injunction
USP DOMESTIC: UNCN Deal Cues Moody's Ratings Review for Downgrade
VALASSIS COMMS: Defines Hotchkis and Wiley Capital as Investors
WERNER LADDER: Gets Interim OK on Executive Incentive Payment Plan
WERNER LADDER: Court OKs Implementation of Employee Severance Plan
WII COMPONENTS: S&P Affirms 'B' Corporate Credit Rating
* AlixPartners Promotes 12 New Managing Directors
* Baird Opens New Corporate Restructuring Investment Banking Group
* Edward Weisfelner Named 2006 Outstanding Restructuring Lawyer
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
*********
ADVANCED MARKETING: Court Gives Interim Nod on Cash Collateral Use
------------------------------------------------------------------
The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for
the District of Delaware granted, on an interim basis, Advanced
Marketing Services Inc. and its debtor-affiliates authority to use
their secured lenders' cash collateral.
The Debtors relate that it will be an event of default if they use
the Lenders' Cash Collateral without further express, written
consent of the Lenders.
Curtis R. Smith, AMS's vice-president and chief financial officer,
reminded the Court that the Debtors have secured a $75,000,000
postpetition facility from Foothill. In that regard, the Debtors
obtained the express consent of the Senior Lenders to use the
prepetition Cash Collateral in connection with the DIP Loan
Facility.
Restrictions on Use of Cash
Mr. Smith relates that the Senior Facility imposes numerous
restrictions on the Debtors' ability to access their cash.
Before the filing of the bankruptcy case, virtually all of the
Debtors' cash from operations was swept daily into an account
controlled by Foothill and applied to the loans outstanding, then
re-advanced as loans in accordance with the borrowing base formula
as established and adjusted by Foothill from time to time.
As of Dec. 29. 2006, the borrowing base formula under the
Senior Facility totaled $64,764,447. In contrast, Mr. Smith
says, the Senior Lenders are secured by approximately
$147,500,000 in accounts receivable, approximately $72,500,000 in
inventory, as well as other valuable collateral including
Advanced Marketing Services' interests in foreign subsidiaries,
fixed assets and intellectual property.
Loan and Security Agreement
The Loan and Security Agreement dated April 27, 2004, among the
Debtors, Wells Fargo Foothill, Inc., as agent, and a syndicate of
lenders, is secured by a first priority security interest on
substantially all of the Debtors' assets, all products and
proceeds of the assets, and all cash proceeds and all other cash
equivalents and cash collateral.
Prior to filing for bankruptcy, the Debtors were obligated to the
Senior Lenders for the principal amount drawn on the Revolving
Loans plus accrued and unpaid interest and certain additional
unpaid fees and expenses totaling $41,514,347.
Pursuant to an Intercompany Subordination Agreement between the
Debtors and certain of their subsidiaries, as Obligors, and
Foothill, the parties agreed to subordinate the payment of all
indebtedness, liabilities and other obligations of each Obligor
owing to any other Obligor to the payment of the $41,514,347
Indebtedness.
To secure all postpetition obligations due to the Lenders by the
Debtors, the Debtors propose to grant the Lenders a lien with
priority and senior to all other liens, other than validly
perfected prepetition liens that would otherwise be senior and
prior to the Senior Lenders' prepetition liens, on all of the
Debtors' prepetition, present and future assets. Moreover, upon
the occurrence of a Default or Event of Default, each Borrower
waives any right to use Cash Collateral.
Judge Sontchi will convene a hearing to consider approval of the
Debtors' request on a final basis on Jan. 24, 2007, at 10:00 a.m.
Objections, if any, are due January 22.
Based in San Diego, California, Advanced Marketing Services, Inc.
-- http://www.advmkt.com/-- provides customized merchandising,
wholesaling, distribution and publishing services, primarily to
the book industry. The company has operations in the U.S.,
Mexico, the United Kingdom and Australia and employs approximately
1,200 people worldwide.
The company and its two affiliates, Publishers Group Incorporated
and Publishers Group West Incorporated filed for chapter 11
protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos. 06-11480
through 06-11482). Suzzanne S. Uhland, Esq., Austin K. Barron,
Esq., and Alexandra B. Feldman, Esq., at O'Melveny & Myers, LLP,
represent the Debtors. Chun I. Jang, Esq., Mark D. Collins, Esq.,
Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A., are
the Debtors' local counsel. When the Debtors filed for protection
from their creditors, they listed estimated assets and debts of
more than $100 million. The Debtors' exclusive period to file a
chapter 11 plan expires on Apr. 28, 2007. (Advanced Marketing
Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
AEGIS ASSET: Moody's Puts Ba2 Rating on Review and May Downgrade
----------------------------------------------------------------
Moody's Investors Service has placed on review for possible
downgrade a certificate from a deal originated in 2003 by Aegis
Asset Backed Securities Trust.
The actions are based on the analysis of the credit enhancement
provided by subordination, overcollateralization, and excess
spread relative to the expected loss.
These are the rating actions:
* Aegis Asset Backed Securities Trust
-- 2003-1, Class B1, Current Rating Ba2, under review for
possible downgrade
AJAY SPORTS: Has Interim Access to Comerica's Cash Collateral
-------------------------------------------------------------
The Honorable Phillip J. Shefferly of the U.S. Bankruptcy Court
for the Eastern District of Michigan has approved, on an interim
basis, a stipulation allowing Ajay Sports Inc. and its debtor-
affiliates to access cash collateral securing repayment of their
obligations to Comerica Bank.
The Debtors inform the Court that ProGolf International Inc. owed
Comerica Bank pursuant to a Demand Installment Note, $3,475,000,
interest of $50,001, transaction fees of $300,000, plus accrued
and accruing interest, costs, fees and expenses.
The prepetition debt is secured by all of PGI, ProGolf.com Inc.
and ProGolf of America Inc.'s assets. The debt is also secured
by:
-- 1,000 shares of the PGA stock pledged to Bank under a
security agreement; and
-- 5,000,040 shares of Ajay stock and 5,000,000 shares of the
stock of Compusonics Video Corporation pledged by TICO, a
Michigan co-partnership, to Bank.
As adequate protection, Comerica Bank is granted a security
interest and lien in all of the Debtors' property. If the
adequate protection is insufficient to protect Comerica Bank for
the Debtors' use of cash collateral, Comerica Bank's claim will
have priority under Section 507(b) of the Bankruptcy Code over all
administrative expenses incurred in the Debtors' chapter 11
proceedings.
The Debtors will use the cash collateral to fund its business
operations, preserve its goodwill and going concern value, pay
normal operating expenses and purchase supplies.
A copy of the Debtor's cash collateral budget is available for
free at http://researcharchives.com/t/s?1850
Headquartered in Farmington, Mich., Ajay Sports Inc. operates the
franchise segment of its business through Pro Golf International,
a 97% owned subsidiary, which was formed during 1999 and owns 100%
of the outstanding stock of Pro Golf of America, and 80% of the
stock of ProGolf.com, which sells golf equipment and other golf-
related and sporting goods products and services over the
Internet. The company and its affiliates filed for chapter 11
protection on Dec. 27, 2006 (Bankr. E.D. Mich. Case Nos. 06-529289
through 06-529292). Arnold S. Schafer, Esq., and Howard M. Borin,
Esq., at Schafer and Weiner, PLLC, represent the Debtor in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they estimated assets less than $10,000 and debts
between $1 million to $100 million.
AMERICAN MOULDING: Disclosure Statement Hearing Slated for Jan. 31
------------------------------------------------------------------
The Honorable Christopher M. Klein of the U.S Bankruptcy Court for
the Eastern District of California will convene a hearing on
Jan. 31, 2007, 9:30 a.m., at Sacramento Courtroom 35, to consider
approval on American Moulding & Millwork Company's Disclosure
Statement explaining its Chapter 11 Plan of Reorganization.
Judge Klien established Jan. 17, 2007, as deadline for objection
to confirmation of the Plan.
Overview of the Plan
The Debtor tells the Court that the Plan is designed to:
-- complete the orderly disposition of all of the assets
of the Debtor that was largely accomplished during the
bankruptcy case;
-- provide for the funding of an investigation of a
potential malpractice action against the Debtor's former
accountants; and
-- distribute the proceeds of the liquidation of the estate
and the litigation to creditors consistent with the
requirements of the Bankruptcy Code and orders of the
Court entered in this case.
Treatment of Claims
Administrative Claims will be paid in full under the Plan. In
addition, Deferred Administrative Claims will be paid pursuant to
Section 6.3.3 of the Plan.
Holders of Priority Claims will be paid the allowed amount.
Prepetition Tax Claims will be paid on a pro rata basis, unless
the claimant and the Debtor agreed to a different treatment.
Wells Fargo Bank, a secured claim holder and the Debtor's
revolving and term lender, will be paid in full. All of Wells
Fargo's payments during the bankruptcy case are ratified.
Other Secured Claims will be permitted to remove under the Plan.
General Unsecured Claims will be paid in full including
postpetition interests. These claims will accrue an interest
rate of 10% per annum.
Appalachian Wood Products, Unsecured Claim holder, who is also
a member of the Official Committee of Unsecured Creditors, will be
paid pro rata with the holders of general unsecured claims.
However, if AWP's claim is less than 15% of the total proceeds,
AWP will be paid 15% of all funds paid to the holders of general
unsecured claims.
Shareholders Claims will be paid a pro rata distribution of the
residual amount after the liquidation of the Debtor's assets.
A full-text copy of American Moulding & Millwork Company's
Disclosure Statement is available for a fee at:
http://www.researcharchives.com/bin/download?id=070110002116
Headquartered in Sanford, North Carolina, American Moulding
and Millwork Company -- http://www.amfurniture.com/-- is a
supplier of real wood furniture and cabinetry. The company
filed for chapter 11 protection on Oct. 6, 2005 (Bankr. E.D.
Calif. Case No. 05-34431). Thomas A. Willoughby, Esq., at
Felderstein Fitzgerald Willoughby & Pascuzzi LLP represents
the Debtor in its restructuring efforts. Lawyers at Parkinson
Phinney represent the Official Committee of Unsecured Creditors.
When the Debtor filed for protection from its creditors, it listed
$17,663,776 in assets and $18,481,093 in debts.
AMERIQUEST MORTGAGE: Fitch Takes Actions on Various Debentures
--------------------------------------------------------------
Fitch has taken rating actions on Ameriquest Mortgage Securities
Inc.'s home equity issues:
AMSI, series 2003-2
-- Class M1 affirmed at 'AA';
-- Class M2 affirmed at 'A';
-- Class M3 downgraded to 'BB-' from 'BBB-'; and
-- Class M4 downgraded to 'CCC/DR5' from 'BB'.
AMSI, series 2004-R4
-- Class A affirmed at 'AAA';
-- Class M1 affirmed at 'AA';
-- Class M2 affirmed at 'A';
-- Class M3 affirmed at 'A-';
-- Class M4 rated 'BBB+' placed on Rating Watch Negative;
-- Class M5 downgraded to 'BBB-' from 'BBB'; and
-- Class M6 downgraded to 'BB-' from 'BBB-'.
AMSI, series 2004-R12
-- Class A affirmed at 'AAA';
-- Class M1 affirmed at 'AA+';
-- Class M2 affirmed at 'AA';
-- Class M3 affirmed at 'AA-';
-- Class M4 affirmed at 'A+';
-- Class M5 affirmed at 'A';
-- Class M6 affirmed at 'A-';
-- Class M7 affirmed at 'BBB+';
-- Class M8 affirmed at 'BBB';
-- Class M9 affirmed at 'BBB-'; and
-- Class M10 affirmed at 'BB+'.
The affirmations, affecting approximately $833.7 million of the
outstanding balances, are taken due to a satisfactory relationship
of credit enhancement to expected losses.
In AMSI series 2003-2, classes M3 and M4 are downgraded due to
monthly losses exceeding the available excess spread in recent
months, which has caused deterioration in the
overcollateralization amount.
As of the December 2006 distribution, the OC amount of
$1.1 million is below the target amount of $2 million. Monthly
losses have exceeded excess spread by an average of $135,000 over
the last six months and based on this projection, Fitch estimates
approximately eight months before class M4 starts to be written
down. As of the cut-off date, the collateral for series 2003-2
had a weighted average original loan-to-value of 80.82%, and
virtually all of the loans from the trust were for the purpose of
refinance. The balance of collateral in states which have
averaged annual home price appreciation below the national average
has increased from 35% of current balance at origination to 60% of
current balance in December.
In AMSI series 2004-R4, class M4 is placed on Rating Watch
Negative and classes M5 and M6 are downgraded due to monthly
losses exceeding the available excess spread in recent months,
which has caused deterioration in the OC amount. As of the
December 2006 distribution, the OC amount of $9.6 million is below
the target amount of $13 million. As of the cut-off date, the
collateral for series 2004-R4 had a weighted average OLTV of 79%,
and all of the loans from the trust were for the purpose of
refinance. The balance of collateral in states which have
averaged annual home price appreciation below the national average
has increased from 35% of current balance at origination to 57% of
current balance in December.
For all three transactions, the underlying collateral consists of
fully amortizing 15- to 30-year fixed- and adjustable-rate
mortgages secured by first liens extended to subprime borrowers.
As of the December distribution date, the transactions listed
above are seasoned from 26 to 45 months. The pool factors range
approximately from 12% to 42%.
The Ameriquest Securities loans, the retail sector for Ameriquest
Mortgage Securities Inc., were either originated or acquired by
Ameriquest Mortgage Company. Ameriquest Mortgage Company serves
as the servicer for the loans and is rated 'RPS2+' by Fitch.
AMERIQUEST MORTGAGE: S&P Cuts Ratings on Four Certificate Classes
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on four
classes from three series of mortgage pass-through certificates
issued by Ameriquest Mortgage Securities Inc.; the four ratings
remain on CreditWatch with negative implications.
In addition, the ratings on class MF-3 and MV-3 from series 2003-1
were placed on CreditWatch negative. Concurrently, the ratings on
six other classes from the same three series were affirmed.
The downgrades and negative CreditWatch placements reflect the
adverse performance of the collateral pools. Monthly net losses
have been consistently outpacing monthly excess interest for these
three transactions, reducing the overcollateralization amounts
below their respective targets. As of the December 2006
distribution period, the O/C levels for series 2002-4, 2003-1,
and 2003-2, were 0.38%, 0.24%, and 0.19%, respectively, compared
with a target of 0.5% for each series.
In addition, cash flow projections indicate further erosion of the
O/C amount as monthly net losses are projected to continue
exceeding monthly excess interest.
Series 2002-4 has cumulative realized losses of 1.31% and total
delinquencies of 27.1%, with approximately half, 14.48%, in the
severely delinquent category. This transaction is 48 months
seasoned and has a pool factor of 8.44%. Series 2003-1 has
cumulative realized losses of 1.64% and total delinquencies of
28.50%, with 16.74% severely delinquent; the pool factor for this
transaction is 10.51% and it is 45 months seasoned.
The cumulative realized losses and total delinquencies for series
2003-2 are 1.72% and 30.98%, respectively, with about half of
total delinquencies, 14.85%, in the severely delinquent category.
This transaction is 45 months seasoned and has a pool factor of
11.20%.
Standard & Poor's will continue to closely monitor the performance
of these transactions. If losses slow to a point at which they no
longer exceed excess interest, and the level of O/C has not been
further eroded, Standard & Poor's will affirm the ratings and
remove them from CreditWatch.
Conversely, if losses continue to exceed excess interest and
further erode O/C, Standard & Poor's will likely take further
negative rating actions.
The affirmations reflect adequate actual and projected credit
support percentages and the shifting interest structure of the
transactions.
Credit support is provided by subordination, O/C, and excess
spread. The collateral consists of 30-year, adjustable-rate,
fully amortizing, subprime mortgage loans secured by first liens
on one- to four-family residential properties.
Ratings Lowered And Placed On Creditwatch Negative
Ameriquest Mortgage Securities Inc.
Mortgage Pass-Through Certificates
Rating
------
Series Class To From
------ ----- -- ----
2002-4 M-4 BB/Watch Neg BBB-/Watch Neg
2003-1 M-4 B/Watch Neg BB/Watch Neg
2003-2 M-3 BB/Watch Neg BBB/Watch Neg
2003-2 M-4 B/Watch Neg BBB-/Watch Neg
Ratings Placed On Creditwatch Negative
Ameriquest Mortgage Securities Inc.
Mortgage Pass-Through Certificates
Rating
------
Series Class To From
------ ----- -- ----
2003-1 MF-3, MV-3 BBB/Watch Neg BBB
Ratings Affirmed
Ameriquest Mortgage Securities Inc.
Mortgage Pass-Through Certificates
Series Class Rating
------ ----- ------
2002-4 M-2 AA-
2002-4 M-3 BBB
2003-1 M-1 AA+
2003-1 M-2 A+
2003-2 M-1 AA+
2003-2 M-2 A+
ARAMARK CORP: S&P Pares Corporate Credit Rating to B+ from BB+
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on ARAMARK Corporation and subsidiary ARAMARK Services Inc.
to 'B+' from 'BB+'. The rating on ARAMARK's existing senior
unsecured debt was lowered to 'B-' from 'BB+', reflecting the
junior position of the unsecured debt relative to the firm's new
secured debt.
At the company's request, the preliminary ratings on ARAMARK's
shelf debt have been withdrawn. All ratings were removed from
CreditWatch, where they were originally placed with negative
implications May 1, 2006, after the initial proposal to take the
company private.
The rating outlook is negative.
At the same time, Standard & Poor's assigned its loan and recovery
ratings to ARAMARK's $4.51 billion senior secured credit
facilities, consisting of a $600 million revolver, a
$3,660 million term loan, and a $250 million synthetic letter of
credit facility. The facilities were rated 'B+' with a recovery
rating of '2', indicating the expectation for substantial recovery
of principal in the event of a payment default.
In addition, Standard & Poor's assigned a 'B-' rating to the
company's proposed $1.7 billion senior unsecured notes due 2014
and to the proposed $570 million of subordinated debt due 2017.
Both the senior unsecured and subordinated debt will be issued
under Rule 144A with registration rights.
Net proceeds from the company's term loan and senior unsecured and
subordinated debt offerings, together with about $2.1 billion of
equity, will be used to finance the acquisition of ARAMARK by a
group of investors led by its chairman and CEO, Joseph Neubauer,
for a transaction value of about $8.7 billion, which includes the
repayment of about $1.7 billion of ARAMARK's
outstanding debt.
Pro forma for the transaction, Philadelphia, Pennsylvania-based
ARAMARK will have approximately $6.5 billion of debt outstanding.
"The 'B+' rating reflects ARAMARK's highly leveraged financial
profile following its acquisition, which will result in pro forma
total debt to EBITDA exceeding 7x at closing and significant cash
flow requirements to fund interest and capital expenditures," said
Standard & Poor's credit analyst Jean Stout.
"However, due to the company's satisfactory business profile,
ARAMARK can support higher-than-typical leverage for the rating.
Rating support is provided by the company's good position in the
competitive fragmented markets for food and support services, as
well as uniform and career apparel. These positions translate
into a sizable stream of recurring revenues and healthy cash flow
generation."
ASARCO LLC: Brings-In LECG LLC as Environmental Consultant
----------------------------------------------------------
The Hon. Richard S. Schmidt of the U.S. Bankruptcy Court for the
Southern District of Texas in Corpus Christi authorizes ASARCO LLC
to employ LECG LLC as its environmental consultant, nunc pro tunc
to Sept. 5, 2006.
The Court prohibits LECG from testifying either on behalf of or
against ASARCO or The Doe Run Resources Corporation and neither
party is authorized from using LECG's work product developed in
connection with ASARCO's Chapter 11 case in any litigation in
which they are adverse to each other unless otherwise agreed to by
both parties.
The Court directs LECG and A.J. Gravel to continue providing
services to Doe Run with respect to litigations with parties other
than ASARCO.
The LECG employees working on the matter for the Viburnum Trend
Haul Roads Site Claimants will not perform any work or provide any
services to ASARCO in connection with the estimation of the VTHR
Claimants' claims, and LECG will take appropriate measures to
ensure that there is no disclosure of ASARCO's confidential
information to the VTHR Experts.
Judge Schmidt also authorizes ASARCO to enter into conflict waiver
agreements relating to LECG and NewFields Companies, LLC.
As reported in the Troubled Company Reporter on Dec. 4, 2006, LECG
will:
-- testify as an expert;
-- provide expert services relating to the estimation of
ASARCO's potential environmental liabilities; and
-- evaluate natural resource damages claim matters and other
related matters.
ASARCO will pay LECG according to the firm's customary hourly
rates. ASARCO expects these LECG professionals to take the lead
in providing consulting services:
Professional Hourly Rates
------------ ------------
J. Zelikson, expert $425
T. Devitt, director $410
R. White, director $410
N. Brody, director $325
A.J. Gravel, director $325
L.Walsh, principal $325
Other LECG professionals who may render their services to ASARCO
will also be paid in their customary hourly rates:
Professional Hourly Rates
------------ ------------
Senior Professional Staff $175 to $300
Professional Staff $100 to $175
Case Associates $65 to $95
Marvin Tenenbaum, Esq., general counsel of LECG, assures the
Court that his firm does not represent any interest adverse to
ASARCO and its estate.
About ASARCO LLC
Tucson, Ariz.-based ASARCO LLC -- http://www.asarco.com/-- is an
integrated copper mining, smelting and refining company. Grupo
Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company
filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex.
Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq.,
and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel
Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble,
Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the
Debtor in its restructuring efforts. Lehman Brothers Inc.
provides the ASARCO with financial advisory services and
investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and
$1 billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered
with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case
was converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7
Trustee.
ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).
(ASARCO Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
ASARCO LLC: Court Approves TMD & Nord Settlement Agreement
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
approved the settlement agreement among ASARCO LLC, TMD
Acquisition Corp., and Nord Resources Corp.
Pursuant to the settlement, TMD and Nord Resources withdrew Claim
No. 8004 against ASARCO. All matters in dispute among ASARCO,
TMD, and Nord Resources have been resolved.
The Court also dismissed, with prejudice, an adversary proceeding
TMD filed, seeking determination whether an asset purchase
agreement dated March 2005 selling ASARCO LLC's mining operation
in Tennessee to TMD Acquisition Corporation is an executory
contract and whether ASARCO is liable under the APA.
Additionally, TMD filed a proof of claim for $47,416,803 against
ASARCO in connection with the APA.
As reported in the Troubled Company Reporter on Dec. 27, 2006,
Timothy P. Dowling, Esq., at Gary, Thomasson, Hall & Marks, P.C.,
in Corpus Christi, Texas, noted that ASARCO's liability under the
APA will be raised in the Adversary Proceeding and possibly, in an
objection to TMD's proof of claim that ASARCO will surely file.
Since the Adversary Proceeding and the objection to TMD's proof of
claim raise similar issues, Mr. Dowling asserted that ASARCO's
objection to TMD's proof of claim be consolidated and tried in the
Adversary Proceeding.
About ASARCO LLC
Tucson, Ariz.-based ASARCO LLC -- http://www.asarco.com/-- is an
integrated copper mining, smelting and refining company. Grupo
Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company
filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex.
Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq.,
and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel
Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble,
Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the
Debtor in its restructuring efforts. Lehman Brothers Inc.
provides the ASARCO with financial advisory services and
investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and
$1 billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered
with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case
was converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7
Trustee.
ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).
(ASARCO Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
AT HOLDINGS: $695MM Eaton Corp. Deal Cues Moody's Ratings Review
----------------------------------------------------------------
Moody's Investors Service placed its ratings of AT Holdings
Corporation, the parent of Argo-Tech Corporation, on review for
possible upgrade.
Moody's has placed AT Holdings Corporation's corporate family
rating at B2.
The review was prompted by the disclosure that Eaton Corporation
will be purchasing AT Holdings for total consideration of
$695 million, which includes the assumption of existing debt.
The review of AT Holdings' ratings will focus on the probability
and nature of support from Eaton Corporation. Bank lines at AT
Holding's wholly owned subsidiary, Argo-Tech, are secured. Moody's
anticipates that Argo-Tech's 9.25% bonds and bank credit
facilities as well as the parent company's senior discount notes
carry more restrictive and costly terms than those available to
Eaton itself. As a result, Moody's considers it likely that at
least some of AT Holdings' debt will be repaid subsequent to the
acquisition.
If a meaningful volume of debt remains at AT Holding or Argo-Tech,
Moody's will assess the availability of formal support provided by
Eaton. The degree and form of support will be a primary
determining factor in assessing risk and assigning a rating.
Should no formal support be provided and should independent
financial statements for AT Holdings or Argo-Tech not remain
available, Moody's will withdraw its ratings assigned to debt
issued by those entities.
AT Holdings Corporation, based in Cleveland, Ohio, through its
wholly-owned subsidiary Argo-Tech Corporation, designs,
manufactures and services high performance fuel flow devices
primarily for the aerospace industry. Products include main
engine fuel pumps, air-frame fuel pumps, aerial refueling systems,
components for ground-fueling systems and industrial cryogenic
pumps and components.
ATSI COMM: Posts $184,000 Net Loss in First Quarter Ended Oct. 31
-----------------------------------------------------------------
ATSI Communications Inc. reported $184,000 net loss on
$6.5 million of revenues for the first quarter ended Oct. 31,
2006, compared with $1.2 million of net income on $2.3 million of
revenues for the same period in 2005.
Carrier services revenue increased $4.2 million due to the
increase in customers over the last twelve months. The increase
in revenues was however offset by a $3.8 million increase in cost
of services which was a direct result of the increase in carrier
services revenue.
The $1.2 million net income during the first quarter ended
Oct. 31, 2005, was mainly due to a gain on disposal of
discontinued operations of $1.6 million related to the sale of
ATSI's ownership in ATSIMex Personal S.A de C.V. Absent said
gain, the company would have incurred a net loss of $412,000.
At Oct. 31, 2006, the company's balance sheet showed $1.4 million
in total assets and $4.5 million in total liabilities, resulting
in a $3.1 million stockholders' deficit.
The company's balance sheet at Oct. 31, 2006, also showed strained
liquidity with $1.3 million in total current assets available to
pay $4.3 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the year ended Oct. 31, 2006, are available for
free at http://researcharchives.com/t/s?183e
Going Concern Doubt
Malone & Bailey PC, in Houston, Texas, expressed substantial doubt
about Atsi Communications Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended July 31, 2006, and 2005. The auditing firm pointed to
the company's working capital deficit, recurring losses, and
stockholders' deficit.
About ASTI Communications
Based in San Antonio, Texas, ASTI Communications Inc. (OTC BB:
ATSX.OB) -- http://www.atsi.net-- through its subsidiaries,
provides international telecommunications services to carriers and
telephony resellers worldwide. It offers digital voice
communications over the internet using voice-over-Internet-
protocol. The company's services include carrier, network, and
communication. The company was founded in 1993 as American
TeleSource International Inc. and changed its name to ATSI
Communications Inc. in 2003.
BEAR STEARNS: Moody's Rates Class I-B-3 Certificates at Ba2
-----------------------------------------------------------
Moody's Investors Service has assigned a rating of Aaa to the
senior certificates issued by Bear Stearns Alt-A Trust 2006-8, and
ratings ranging from Aa1 to Ba2 to the mezzanine and subordinate
certificates in the deal.
The securitization is backed by adjustable-rate, Alt-A mortgage
loans acquired by EMC Mortgage Corporation and originated by EMC,
Mid America Bank, fsb for Groups I and II, Wells Fargo Bank, N.A.
for Group III and various other originators, none of which
originated more than 10% of the mortgage loans. The ratings are
based primarily on the credit quality of the loans and on the
protection from subordination.
In addition, the ratings for Group I are also based on the
protection from overcollateralization and excess spread. Moody's
expects collateral losses to range from 1.45% to 1.65% for Group
I, 0.95% to 1.15% for Group II, and collateral losses to range
from 0.65% to 0.85% for Group III.
EMC, HSBC Mortgage Corporation, Wells Fargo Bank, N.A., Mid
America Bank, fsb, and EverHome Mortgage Company will service the
loans. Wells Fargo Bank, N.A. will act as master servicer.
Moody's has assigned EMC its servicer quality ratings of SQ2 as a
primary servicer of prime loans. Moody's has also assigned Wells
Fargo Bank, N.A. its top servicer quality rating of SQ1 as primary
servicer of prime loans and master servicer.
These are the rating actions:
* Bear Stearns Alt-A Trust 2006-8
* Mortgage Pass- Through Certificates, Series 2006-8
Class I-A-1, Assigned Aaa
Class I-A-2, Assigned Aaa
Class I-M-1, Assigned Aa2
Class I-M-2, Assigned A2
Class I-B-1, Assigned Baa2
Class I-B-2, Assigned Baa3
Class I-B-3, Assigned Ba2
Class II-A-1, Assigned Aaa
Class II-A-2, Assigned Aa1
Class II-X-1, Assigned Aaa
Class II-B-1, Assigned Aa2
Class II-BX-1,Assigned Aa2
Class II-B-2, Assigned A2
Class II-BX-2,Assigned A2
Class II-B-3, Assigned Baa2
Class III-A-1,Assigned Aaa
Class III-A-2,Assigned Aaa
Class III-X-1,Assigned Aaa
Class III-B-1,Assigned Aa2
Class III-B-2,Assigned A2
Class III-B-3,Assigned Baa2
BEAR STEARNS: Moody's Rates Class II-B-5 Certificates at Ba1
------------------------------------------------------------
Moody's Investors Service has assigned an Aaa rating to the senior
certificates issued by Bear Stearns Mortgage Funding Trust 2006-
AR5, and ratings ranging from Aaa to Ba1 to the subordinate
certificates in the deal.
The securitization is backed by first lien, adjustable-rate,
negative amortization Alt-A mortgage loans originated by Bear
Stearns Residential Mortgage Corp. and EMC Mortgage Corporation.
The ratings are based primarily on the credit quality of the
loans, and on protection against losses from subordination,
overcollateralization, and excess spread. Moody's expects
collateral losses to range from 1.15% to 1.35% for Group I and
collateral losses to range from 1% to 1.2% for Group II.
EMC will service the loans. Moody's has assigned EMC its servicer
quality rating of SQ2 as primary servicer of prime loans.
These are the rating actions:
* Bear Stearns Mortgage Funding Trust 2006-AR5
* Mortgage Pass-Through Certificates, Series 2006-AR5
Class I-A-1, Assigned Aaa
Class I-A-2, Assigned Aaa
Class I-A-3, Assigned Aaa
Class II-A-1,Assigned Aaa
Class II-A-2,Assigned Aaa
Class II-A-3,Assigned Aaa
Class I-X, Assigned Aaa
Class I-B-1, Assigned Aaa
Class I-B-2, Assigned Aa1
Class I-B-3, Assigned Aa1
Class I-B-4, Assigned Aa2
Class I-B-5, Assigned Aa3
Class I-B-6, Assigned A1
Class I-B-7, Assigned A3
Class I-B-8, Assigned Baa2
Class I-B-9, Assigned Baa3
Class II-B-1,Assigned Aaa
Class II-B-2,Assigned Aa3
Class II-B-3,Assigned A3
Class II-B-4,Assigned Baa1
Class II-B-5,Assigned Ba1
BOWNE & CO: Moody's Holds Corporate Family Rating at Ba3
--------------------------------------------------------
Moody's Investors Service affirmed the Ba3 corporate family rating
and all other ratings of Bowne & Co. Inc.
The outlook remains positive, indicating the potential for an
upgrade within the next 12 to 18 months, notwithstanding continued
share repurchase, the cash acquisition of Vestcom, and capital
expenditures related to headquarters relocation.
Bowne's Ba3 corporate family rating continues to reflect concerns
over its inability to generate free cash flow, exposure to the
capital markets cycle, some vulnerability to the reduction in
demand for printed products, and some execution and acquisition
risk. Strong liquidity, moderate leverage, and a considerable
stream of recurring revenue support the ratings.
Moody's would consider an upgrade with evidence of EBITDA margin
improvement from the current approximately 11% level and clear
progress toward a free cash flow-to-debt ratio in excess of 5%.
These are the rating actions:
* Bowne & Co., Inc.
-- Affirmed Ba3 corporate family rating
-- Affirmed Ba3 probability of default rating
-- Affirmed B2 Convertible Subordinated Notes Rating,
LGD5, 87%
Headquartered in New York, New York, Bowne & Co., Inc. provides
services to help companies produce and manage their investor
communications, including regulatory and compliance documents, and
also markets business communications, personalized statements,
enrollment books and sales and marketing collateral. Its annual
revenue is approximately $800 million.
CARROLS CORP: S&P Holds Corporate Credit Rating at B+
-----------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on Syracuse, New York-based Carrols Corp., and
removed its ratings from CreditWatch, where they had been placed
with positive implications on Oct. 16, 2006.
In addition, Standard & Poor's upgraded the company's bank loan
ratings to 'BB-' from 'B+'. The recovery ratings were raised to
'1' from '2'.
"The removal from CreditWatch and bank loan ratings revision
follows the company's successful IPO of its common stock for $65.4
million--less than the potential $210 million originally
expected," said Standard & Poor's credit analyst Jackie Oberoi.
All proceeds from the IPO are expected to be used to reduce the
company's term loan.
"While resulting leverage remains high at about 6x, the debt
reduction results in an improvement in expected recovery of
principal in the event of payment default," said Ms. Oberoi.
Carrols is the largest Burger King franchisee in the U.S., with
330 restaurants in 13 states in the Northeast, Midwest and
Southeast U.S. The company also operates and is a franchisor of
239 Pollo Tropical restaurants, primarily in Florida, and Taco
Cabana restaurants, primarily in Texas.
COLLINS & AIKMAN: Wants Plan-Filing Period Extended to May 14
-------------------------------------------------------------
Collins & Aikman Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Eastern District of Michigan to further
extend:
-- their exclusive period to file a plan of reorganization
from Jan. 12, 2007, through and including May 14, 2007;
and
-- their exclusive period to solicit acceptances of the plan
from March 14, 2007 through and including July 12, 2007,
without prejudice to the their rights to seek additional
extensions.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, New
York, tells the Court, since the latest extension of the
Exclusivity Periods, and in connection with the pursuit of a
cooperative sale process, the Debtors recently negotiated a
customer agreement with their principal customers and the senior,
secured lenders' agent, JPMorgan Chase Bank, N.A.
As a result of the Customer Agreement's interim approval, the
Debtors filed their first amended Chapter 11 Plan and Disclosure
Statement on Dec. 22, 2006. JPMorgan and the Customers
agreed to support the Plan.
Mr. Schrock relates, upon information and belief, JPMorgan and
the Official Committee of Unsecured Creditors will soon reengage
in negotiations regarding the Plan. Accordingly, more time is
needed to negotiate the terms of a consensual plan with the
Creditors Committee and to incorporate the terms into the Amended
Plan for the Court's approval, he asserts.
The Debtors are also continuing their efforts to market and sell
substantially all of their assets, Mr. Schrock relates. Pursuant
to the Customer Agreement, the Debtors intend to complete the
process by the end of June 2007.
The Debtors believe that it is important to the stability of
their bankruptcy cases that they maintain their exclusive right
to propose and file a Chapter 11 Plan, and to solicit and obtain
acceptances of the Plan. An extension does not harm parties-in-
interest, Mr. Schrock maintains. On the other hand, he contends,
the termination of the Exclusivity Periods could expose the
Debtors' Chapter 11 cases to needless disruption that could
jeopardize the significant progress that the Debtors have made to
date.
Moreover, the size and complexity of the Debtors' Chapter 11
cases alone constitute sufficient cause for an extension,
Mr. Schrock argues.
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. 49;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
CROWN CASTLE: Global Signal Stockholders Vote on Form of Merger
---------------------------------------------------------------
Crown Castle International Corp. and Global Signal Inc. reported
preliminary results of elections made by Global Signal stock-
holders regarding their preferences as to the form of merger
consideration they will receive in the pending acquisition of
Global Signal by Crown Castle.
The election deadline for Global Signal stockholders to have made
merger consideration elections in connection with the proposed
merger expired at 5:00 p.m., New York City time, on Jan. 8, 2007.
Of the approximately 70,713,364 shares of Global Signal common
stock outstanding and eligible to make elections as of
Jan. 8, 2007:
- 68,790,391 shares, or approximately 97.3%, elected to
receive cash;
- 1,844,662 shares, or approximately 2.6%, elected to
receive Crown Castle common stock; and
- 78,311 shares, or approximately 0.1%, did not make a
valid election.
The elections with respect to approximately 6,342,572 of the
foregoing shares electing to receive cash and approximately
113,777 of the foregoing shares electing to receive stock were
made pursuant to the notice of guaranteed delivery procedure,
which requires the delivery of Global Signal shares to the
exchange agent for the merger by 5:00 p.m., New York City time,
today, Jan. 11, 2007. If the exchange agent does not receive the
required share certificates or book-entry transfer of shares by
this guaranteed delivery deadline, the Global Signal shares
subject to such election will be treated as shares that did not
make a valid election.
After the final results of the election process are determined,
the actual merger consideration and the allocation of the merger
consideration will be computed using the formula in the merger
agreement. The aggregate amount of cash that will be paid in the
merger is capped at $550 million and will be reduced on a dollar-
for-dollar basis to the extent of certain cash dividends and other
cash distributions declared or paid by Global Signal or any of its
subsidiaries after Oct. 5, 2006 and prior to the effective time of
the merger. No such cash dividends or other cash distributions
have been declared or paid as of Jan. 8, 2007.
About Crown Castle
Crown Castle International Corp. -- http://www.crowncastle.com/
-- engineers, deploys, owns and operates shared wireless
infrastructure, including extensive networks of towers. Crown
Castle offers wireless communications coverage to 68 of the top
100 United States markets and to substantially all of the
Australian population. Crown Castle owns, operates and manages
over 10,600 and over 1,300 wireless communication sites in the
U.S. and Australia, respectively.
* * *
As reported in the Troubled Company Reporter on Dec. 1, 2006,
Fitch placed a BB+ rating on Crown Castle's $249,000,000 class F
Series 2006-1 commercial mortgage pass-through certificates and a
BB rating to the company's $83,000,000 Class G Series 2006-1
commercial mortgage pass-through certificates.
DANA CORP: Court OKs Trailer Axles Amended APA with Hendrickson
---------------------------------------------------------------
The Hon. Burton R. Lifland of the U.S. Bankruptcy Court for the
Southern District of New York approves Dana Corp. and its debtor-
affiliates' amended asset purchase agreement with Hendrickson USA
LLC for the sale of the Trailer Axles Business.
Hendrickson will pay approximately $32,500,000 for the Business.
The Debtors and Hendrickson amended their APA to reflect that:
* Hendrickson will pay $20,740,000, plus or minus adjustments
for the domestic assets of Trailer Axles;
* Hendrickson will purchase the Canadian assets for $9,760,000
and the China assets for $2,000,000;
* The Debtors will pay an $812,500 Termination Fee to
Hendrickson if an Alternative Transaction is contemplated;
and
* The Debtors will reimburse Hendrickson up to $162,500 for
out-of-pocket expenses.
The Debtors also filed a revised proposed order, which provides
that they and Dana Canada Corporation are not authorized to sell
or assign any interests in any of the equipment that GE Canada
Asset Financing Holding Company leases to Dana Canada pursuant to
a Master Lease Agreement, dated June 27, 2003, and Schedules 001
and 002.
Dana Canada's obligations to GE Canada under the Lease or Dana
Corp.'s guaranty will not be affected by the proposed sale.
Enterprise Welding Sought Clarification
The Debtors and Enterprise Welding and Fabricating Inc. are
parties to a Trade Agreement under which Enterprise manufactures
components pursuant to exacting standards and specifications and
in accordance with a timetable to comply with the Debtors' "just
in time" production model.
According to Steven B. Beranek, Esq., at Corsaro & Associates
Co., LPA, in Westlake, Ohio, Enterprise had not been granted any
assurance that it will continue to be a supplier to the
successful bidder or that it will not be forced to pay for the
sub-components it ordered in anticipation of the Debtors'
demands.
Mr. Beranek noted that Hendrickson USA LLC is a competitor of
the Debtors, thus, it is possible that instead of continuing the
Debtors' line of trailer axles, Hendrickson will retire the line
to increase demand for its own brand of trailer axles. Should
Hendrickson do this, it will not need the components manufactured
by Enterprise since Hendrickson's trailer axles are significantly
different than the Debtors' axles. Mr. Beranek said there is a
great uncertainty as to when any demand for Enterprise's
components will cease.
Mr. Beranek asserted that if Enterprise is not given sufficient
advance notice of the cessation of demand for the component
parts, Enterprise will experience financial distress because it
will need to pay the sub-component parts and raw materials that
it ordered in advance to meet the Debtors' needs.
Before their bankruptcy filing, the Debtors have indicated that
their demand for component parts from Enterprise will increase.
The increased orders, however, have not materialized, leaving
Enterprise with excess inventory.
Mr. Beranek added that if Enterprise fails to perform its
obligations under the Trade Agreement, it maybe required to
refund the payments previously made by the Debtors. The payments
were necessary for Enterprise's business, and if it is compelled
to return them, it would cause great financial distress.
Thus, Enterprise asked the Court to direct the Debtors to clarify
its responsibilities under the Trade Agreement whether it must
still provide the same level of service as it did prepetition.
Enterprise also asked the Court to direct the Debtors to assure
that:
(a) it will be reimbursed for the financial commitments it was
required to make to fulfill the Debtors' production
requirement; or
(b) Hendrickson or another successful bidder will purchase the
components that Enterprise has already committed or will
provide Enterprise with at least six months' advance
notice prior to the cessation of purchasing its products.
About Dana Corp.
Toledo, Ohio-based Dana Corp. -- http://www.dana.com/-- designs
and manufactures products for every major vehicle producer in the
world, and supplies drivetrain, chassis, structural, and engine
technologies to those companies. Dana employs 46,000 people in
28 countries. Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.
The company and its affiliates filed for chapter 11 protection on
Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of Sept. 30,
2005, the Debtors listed $7,900,000,000 in total assets and
$6,800,000,000 in total debts.
Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in
Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors. Henry S. Miller at
Miller Buckfire & Co., LLC, serves as the Debtors' financial
advisor and investment banker. Ted Stenger from AlixPartners
serves as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP,
represents the Official Committee of Unsecured Creditors. Fried,
Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the
Official Committee of Equity Security Holders. Stahl Cowen
Crowley, LLC serves as counsel to the Official Committee of
Non-Union Retirees.
The Debtors' exclusive period to file a plan expires on Sept. 3,
2007. They have until Nov. 2, 2007, to solicit acceptances to
that plan. (Dana Corporation Bankruptcy News, Issue No. 29;
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).
DANA CORP: Wants Warehouse Services Agreement with AMI Approved
---------------------------------------------------------------
Dana Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court
for the Southern District of New York to approve a settlement
agreement and to assume an amended and modified services agreement
with American Materials Inc.
Pursuant to a Warehouse Services Agreement, the Debtors lease
warehouse space at a facility owned by American Materials Inc.
located in Henderson, Kentucky. AMI also provides the Debtors
with basic services relating to the transfer, inventory and
storage of the Debtors' goods.
In exchange for the AMI Services, the Debtors pay $34,650 every
month. The Debtors make additional payments as additional
services are provided. The Services Agreement will expire on
Oct. 19, 2009, and is not terminable by the Debtors except
upon a default by AMI.
In September 2006, AMI filed a proof of claim asserting $217,685.
In November and December 2006, the Debtors paid an aggregate of
$57,274 on account of certain postpetition charges under the
Services Agreement.
In October 2006, AMI asked the Court to compel the Debtors to
surrender the Henderson Facility and pay AMI's administrative
claims. The Debtors asserted that the Services Agreement is not
an unexpired nonresidential real property lease, but rather is an
executory contract that had not yet been assumed nor rejected.
The Debtors have reviewed the Services Agreement and determined
that the AMI Services are not necessary for the entire remaining
term of the Services Agreement; the Debtors, however, require
uninterrupted access to the AMI Services at the AMI Facility in
the short term.
Corinne Ball, Esq., at Jones Day, in New York, says the Debtors
are in the process of implementing their strategic plan to
streamline their supply chain, including reducing their reliance
on outside warehousing services, like those provided by AMI, and
utilizing excess space in other Dana-owned facilities.
Based on their projections for the implementation of the
streamlining plan, the Debtors believe that the AMI Services will
be needed only until the end of 2007.
Ms. Ball says that if AMI's Motion to Compel is granted and the
Services Agreement deemed rejected, the Debtors would experience
disruption in their business operations due to a lack of a
suitable substitute for the AMI Services or the ability to
complete a smooth transition to another warehouse services
provider.
Although the Debtors believe that the Services Agreement properly
is considered an executory contract that need not be assumed or
rejected until the confirmation of any plan of reorganization,
Ms. Ball adds that there is no guarantee that the Debtors would
prevail in a litigation.
Thus, to mitigate the risk and provide other benefits to their
estates, the Debtors worked with AMI to explore possible
resolutions to the parties' disputes relating to the Services
Agreement.
The parties entered into a Settlement Agreement, which provides
that:
(a) The parties will shorten the remaining term of the
Services Agreement until Dec. 31, 2007;
(b) Payment terms are extended from 30 days to net 35 days.
The late fees for all invoices issued under the Services
Agreement will be increased from 1% to 2% of the invoice
amount and payments for any past due amounts will be made
immediately after the Debtors receive written notice of
payment default from AMI.
(c) The Debtors will assume the Services Agreement, as amended
and modified.
(d) The Debtors will pay $67,010 to AMI as cure, in full
satisfaction of their obligations under the Services
Agreement.
(e) AMI will be granted an allowed general unsecured
non-priority claim against the Debtors for $325,000.
(f) The parties mutually release all claims they may have
against each other arising from the Services Agreement.
(g) AMI will withdraw its Motion to Compel.
Toledo, Ohio-based Dana Corp. -- http://www.dana.com/-- designs
and manufactures products for every major vehicle producer in the
world, and supplies drivetrain, chassis, structural, and engine
technologies to those companies. Dana employs 46,000 people in
28 countries. Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.
The company and its affiliates filed for chapter 11 protection on
Mar. 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of Sept. 30,
2005, the Debtors listed $7,900,000,000 in total assets and
$6,800,000,000 in total debts.
Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in
Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors. Henry S. Miller at
Miller Buckfire & Co., LLC, serves as the Debtors' financial
advisor and investment banker. Ted Stenger from AlixPartners
serves as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP,
represents the Official Committee of Unsecured Creditors. Fried,
Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the
Official Committee of Equity Security Holders. Stahl Cowen
Crowley, LLC serves as counsel to the Official Committee of
Non-Union Retirees.
The Debtors' exclusive period to file a plan expires on Sept. 3,
2007. They have until Nov. 2, 2007, to solicit acceptances to
that plan. (Dana Corporation Bankruptcy News, Issue No. 29;
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).
DELPHI CORP: Highland Proposes Alternative Framework Agreements
---------------------------------------------------------------
Highland Capital Management LP asks the U.S. Bankruptcy Court for
the Southern District of New York to deny Delphi Corp. and its
debtor-affiliates' request to enter into an equity purchase and
commitment agreement and a plan framework support agreement or, in
the alternative, reschedule a hearing on the motion on or before
Jan. 22, 2006, to allow Delphi's board of directors adequate time
to review the Highland Commitment.
Judith Elkin, Esq., at Haynes and Boone, LLP, in New York,
contends that the Appaloosa Framework Agreements are
fundamentally unfair to the common stockholders of Delphi
Corporation and are not in Delphi's best interests for these
reasons:
-- The Appaloosa Plan Investors will receive a 1.75%
Commitment Fee worth $20,000,000 to purchase Preferred
Stock that they are only offering to themselves;
-- The Appaloosa Plan Investors' exclusive right to acquire
Preferred Stock gives them disproportionate control of the
board of directors and exclusive approval rights over
future business decisions of the reorganized Company;
-- Under the Appaloosa Framework Agreements, unsecured
creditors will be overpaid by approximately $232,200,000
and junior creditors will be overpaid by approximately
$129,000,000 since common stock will be used to partially
pay creditor claims at lower than market values;
-- The Plan Investors require Delphi to pay a $100,000,000
Break-up Fee; and
-- The Debtors filed their motion to enter into the Appaloosa
Framework Agreements on December 18, 2006.
The Motion should not be heard on an expedited basis especially
when its review and consideration is set to occur during and
shortly after a holiday period when many financial and other
necessary parties are unavailable or have limited availability,
Ms. Elkin argues.
Consequently, Highland Capital Management, LP, informs the Court
that it delivered a commitment letter to Delphi's board of
directors on Dec. 21, 2006. Under its Commitment Letter,
Highland proposes to invest up to $4,700,000,000 in new Common
Stock of reorganized Delphi in a transaction similar to the
proposed Appaloosa Framework Agreements, but consistent with the
principles of fairness embodied in the Bankruptcy Code, Ms. Elkin
says. The Highland Commitment Letter also specifies the terms of
and support for a plan of reorganization that is based on Highland
Capital's investment in the Delphi Common Stock.
According to Ms. Elkin, the Highland Commitment will provide
these benefits:
-- The ability of the present board of directors to submit a
proposal to the Court that is consistent with its fiduciary
duties to all of its stakeholders and should garner the
support of the Official Committee of Equity Security
Holders.
-- Delphi's ability to obtain $4,700,000,000 of capital
without offering a $1,200,000,000 preferred stock deal to
the Appaloosa Plan Investors that significantly dilutes the
existing stockholders, allows the Appaloosa Plan Investors
to take control of the Company through its preferential
acquisition of almost 30% of the Delphi's equity and grants
special veto rights to the Appaloosa Plan Investors on
significant Delphi transactions in the future.
-- The ability to proceed with a rights offering that does not
guarantee an allocation of 6,300,000 shares to the
Appaloosa Plan Investors.
-- The ability to endorse the management of the Company, as
announced on December 18, 2006, while at the same time
ensuring that the management will report to an independent
board of directors that is not subject to the whims of and
controlled by the Appaloosa Plan Investors.
-- A transaction that accepts the negotiated deal between the
Company and General Motors Corporation, which should be
equally supported by GM and the statutory committees.
-- A transaction that offers existing stockholders the ability
to capture the economic value of the enterprise, rather
than allowing the Appaloosa Plan Investors to take that
value in violation of the spirit and letter of the
Bankruptcy Code.
-- A transaction that will be embraced by the market because
it is reflective of, and enhances, the current value of the
Company.
The market recognizes the inherent fairness of the Highland
Commitment because common shares are trading 30% higher after the
Highland Commitment was announced, Ms. Elkins says.
More Objections
1. U.S. Trustee
The United States Trustee opposes the Equity Purchase and
Commitment Agreement and the Plan Framework Support Agreement on
two grounds:
(i) The EPCA calls for the payment of millions of dollars of
fees and expenses, as allowed administrative claims under
Section 503(b)(1) of the Bankruptcy Code, to non-retained
professionals for the entities that will fund the Debtors'
emergence from bankruptcy. Those fees and expenses will
be paid with no oversight by the statutory committees, the
Fee Committee, the U.S. Trustee or the Bankruptcy Court,
Alicia M. Leonhard, Esq., in New York, points out.
(ii) The PSA appears to be a sub rosa plan of reorganization
that circumvents the disclosure statement and plan
confirmation approval process set forth in Section 1123,
1125 and 1129 of the Bankruptcy Code. The PSA also
restricts the rights of creditors and parties-in-interest
to meaningfully participate in plan negotiations. "The
[PSA] is no more than a term sheet for a plan that has yet
to be filed. It should only be considered in the context
of continued plan negotiations," Ms. Leonhard contends.
As administrative claimants, the professionals of the Plan
Investors should file applications under Section 503, rather than
obtain blanket approval of retroactive and prospective fees and
expenses without any review by parties-in-interest or the Court,
Ms. Leonhard asserts.
With respect to all of the professionals except Appaloosa
Management L.P., without more information, the U.S. Trustee
cannot determine whether the fees and expenses are reasonable,
"actual and necessary," subject to Section 503(b)(4), or a
reasonable exercise of the Debtors' business judgment, Ms.
Leonhard emphasizes. Moreover, Appaloosa must demonstrate that
it made a substantial contribution to the Debtors' cases in
representing an Ad Hoc committee of Equity Security Holders under
Section 503(b)(4), Ms. Leonhard adds.
Thus, the U.S. Trustee asks the Court to order the Plan
Investors' professionals to file applications under Section 503
for review and approval under the appropriate standard prior to
any payment of fees and expenses under the EPCA.
Ms. Leonhard notes that the PSA dictates many of the terms of the
plan. It determines the maximum aggregate of allowed unsecured
claims. It codifies a settlement of General Motors' claim
apparently without the agreement of the Official Committee of
Unsecured Creditors or the Official Committee of Equity Security
Holders.
Under the PSA, the parties have determined the value of the
shares of stock for plan distribution purposes. The parties have
also decided how much is needed to resolve the pension
obligations in an agreement that does not include the Pension
Benefit Guaranty Corporation. However, there has been no
disclosure as to the how the terms were derived or opportunity
for those affected to vote, Ms. Leonhard cites.
Accordingly, the U.S. Trustee asks the Court to disapprove the
PSA as a sub rosa plan.
2. IUOE Locals
The terms of the EPCA and the PSA and the rights afforded the
Plan Investors will have a substantial impact on employee claims
and the Section 1113 and 1114 proceedings, Barbara S. Mehlsack,
Esq., at Gorlick, Kravitz & Listhaus, P.C., in New York, avers.
Accordingly, the International Union of Operating Engineers Local
Union Nos. 18S, 101S and 832S seek to protect the claims of their
members and their rights under their collective bargaining
agreements.
The IUOE Locals represent 21 employees in three facilities of
Delphi, located in Rochester, New York; Olathe, Kansas; and
Columbus, Ohio.
The IUOE Locals complain that the payment of $76,000,000 in
Commitment Fees and $13,000,000 in Transaction Expenses under the
EPCA is justified solely on the bare bones recital that the
Investors would not otherwise have entered into the terms of the
EPCA.
Under the EPCA, the Plan Investors' obligation to consummate the
contemplated transactions are conditioned on the Debtors reaching
consensual agreements with its major labor union by January 31,
2007, including terms and conditions affecting plant closings,
asset dispositions and resolution of union claims.
"In view of [Delphi's] insistence on 'pattern bargaining' with
the IUOE Locals, seeking to bind them to the terms of the major
union contracts, for all practical purposes the fate of the IUOE
Locals' agreements are in the hands of the Plan Investors," Ms.
Mehlsack asserts.
The IUOE Locals have sought to negotiate with Delphi a spin off
of assets and liabilities attributable to IUOE represented plan
participants to a well-funded multi-employer plan but have been
stone walled by the Debtors, according to Ms. Mehlsack. The PSA,
however, provides that Delphi will do a spin off of plan assets
and liabilities without regard to Delphi's collective bargaining
obligations regarding the Pension Plan for Hourly Employees, Ms.
Mehlsack notes.
The PSA also provides that all employee-related obligations are
flow through claims that will be unimpaired but excludes
collective bargaining-related employee claims from flow though
status, Ms. Mehlsack argues.
Thus, the IUOE Locals ask the Court to deny the Debtors' Motion
as currently proposed.
3. IBEW and IAMAW
The International Brotherhood of Electrical Works Local 663 and
International Association of Machinists and Aerospace Workers
District 10 do not oppose the introduction of new equity through
an appropriate equity purchase agreement. IBEW and IAM, however,
complain that the EPCA and the PSA, as drafted, inappropriately
interfere with Section 1113 and 1114 negotiations.
"The Agreements, in their present form, inappropriately
predetermine the plan of reorganization to the detriment of
employees represented by the IBEW and IAM in comparison to
unrepresented employees, while providing exorbitant fees to Plan
Investors, and specified recoveries to, without specified
commitment by, General Motors," Marianne Goldstein Robbins, Esq.,
at Previant, Goldberg, Uelmen, Gratz, Miller & Brueggeman, S.C.,
in Milwaukee, Wisconsin, argues.
IBEW and IAM complain that the $76,000,000 in Commitment Fees and
the $100,000,000 Alternative Transaction Fee under the ECPA are
exorbitant and utilize resources, which could otherwise be
funding the Debtors' contractual obligations to their employees.
The Alternate Transaction Fee will also prevent appropriate
consideration of alternate sources of equity, Ms. Robbins
asserts. From the filing of objecting parties, it appears that
there are alternative sources of equity, which should be
considered before exorbitant fees are incurred, Ms. Robbins
notes.
Moreover, since Debtors have insisted that the IBEW and IAM agree
to provisions negotiated with the UAW, the authority for
negotiating agreements between the Debtors and the IBEW and IAM
is transferred to the UAW and the Investors, in violation of the
provisions of Sections 1113 and 1114 of the Bankruptcy Code.
The PSA defines what general unsecured creditors will receive --
claims will be limited to $1,700,000,000. However, the amount of
general unsecured claims has not been determined and these may
include claims of union represented employees and retirees, Ms.
Robbins points out.
Appaloosa, et al., Join In Debtors' Request
Appaloosa Management L.P., A-D Acquisition Holdings, LLC,
Harbinger Capital Partners, LLC, Harbinger Del-Auto Investments
Company, Ltd., and the rest of the Appaloosa Plan Investors
support the Debtors' request and assert that the Appaloosa
Framework Agreements are in the best interests of the Debtors and
their estates.
Troy, Mich.-based Delphi Corporation -- http://www.delphi.com/--
is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology. The company's technology and
products are present in more than 75 million vehicles on the road
worldwide. The company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtor in
its restructuring efforts. Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtor's balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts. (Delphi Corporation Bankruptcy News, Issue No. 53;
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).
DELPHI CORP: Judge Drain Approves Claims Estimation Procedures
--------------------------------------------------------------
Delphi Corp. and its debtor-affiliates obtained permission from
the Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York to:
(a) schedule special hearings to consider contested claims
matters;
(b) establish certain procedures governing the filing and
contents of responses of claimants to omnibus claims
objections;
(c) establish certain procedures for the service of omnibus
claims objections;
(d) establish certain procedures governing the adjudication of
contested claims matters; and
(e) limit the service of orders by Kurtzman Carson
Consultants, LLC, the Debtors' claims and noticing agent,
entered with respect to omnibus claims objections to avoid
unnecessary costs to the Debtors' estates.
In particular, the Court rules that any response to a claims
objection or an omnibus claims objection must:
-- be in writing;
-- conform to the Federal Rules of Bankruptcy Procedure, the
Local Bankruptcy Rules for the Southern District of New
York, and the Oct. 26, 2006, Amended Eighth Supplemental
Case Management Order;
-- be filed with the Court in accordance with General
Order M-242;
-- be submitted in hard copy form directly to the chambers of
Judge Drain; and
-- be served upon the Debtors and their counsel.
Every Response must contain, at a minimum:
-- the title of the claims objection to which the Response is
directed;
-- the name of the claimant and a brief description of the
basis for the claim amount;
-- a concise statement setting forth the reasons why the claim
should not be disallowed, expunged, reduced, or
reclassified;
-- unless already set forth in the proof of claim previously
filed with the Court, documentation sufficient to establish
a prima facie right to payment
-- to the extent that the claim is contingent or fully or
partially unliquidated, the amount that the claimant
believes would be the allowable amount of its claim upon
liquidation of the claim or occurrence of the contingency,
as appropriate; and
-- the addresses to which the Debtors must return any reply to
the Response, if different from the addresses presented in
the claim.
All contested claims for which a timely Response is filed will be
automatically adjourned to a future hearing, the date of which
will be determined by the Debtors, in their sole discretion, by
serving the Claimant with a notice, Judge Drain states.
If the amount in dispute for a Contested Claim exceeds $1,000,000
or a Contested Claim asserts unliquidated claims; the Claimant or
the Claimant's principal place of business, as applicable, is
located within 90 miles of Troy, Michigan; and that Contested
Claim is scheduled by the Debtors for a Claims Objection Hearing,
the Debtors and the Claimant will hold an in-person meet and
confer at a neutral location in Troy, Michigan, or another
agreeable location.
If a Contested Claim is scheduled by the Debtors for a Claims
Objection Hearing, and if the amount in dispute for the Contested
Claim is less than or equal to $1,000,000; the Contested Claim
asserts unliquidated claims and the Claimant irrevocably agrees
in writing that the allowed Claim Amount will be limited to a
maximum of $1,000,000; or the Claimant or the Claimant's
principal place of business, as applicable, is located more than
90 miles from Troy, Michigan, the Debtors and the Claimant will
hold a telephonic meet and confer within 10 business days of
service of the Notice of Claims Objection Hearing.
The Court rules that the Claims Estimation Procedures will not
apply to these claimants:
* Cadence Innovation LLC,
* Pension Benefit Guaranty Corporation,
* Robert Bosch GmbH,
* Technology Properties, Ltd.,
* The State of California Environmental Protection Agency,
* The State of Michigan Environmental Protection Agency,
* The State of Ohio Environmental Protection Agency, and
* The United States Environmental Protection Agency.
The Claims Estimation Procedures will also not apply to nine
additional claimants with respect to these claims:
Claimant Claim No.
-------- ---------
Banc of America Securities LLC 10758
Barclays Capital Inc. 11658
Bear, Stearns & Co. Inc. 10732
Citigroup Global Markets, Inc. 10731
Credit Suisse Securities (USA) LLC 10763
Merrill Lynch, Peirce, Fenner & Smith Inc. 10761
Morgan Stanley & Co. Inc. 10762
UBS Securities LLC 10759
Wachovia Capital Markets, LLC 10760
The Excluded Parties or the Debtors are not precluded from
seeking to establish appropriate alternative claims resolution
procedures, Judge Drain clarifies.
The Court permits Gary Whitney and NuTech Plastics Engineering,
Inc., to submit a request to lift the stay subject to the
Debtors' right to object to the request.
A number of the Excluded Parties objected to the Debtors'
request. Other Objecting Creditors include:
* ATEL Leasing Corp.,
* Electronic Data Systems Corporation,
* H.E. Services Company,
* Hitachi Chemical (Singapore) Pte. Ltd.,
* InPlay Technologies, Inc.,
* Kilroy Realty, L.P.,
* Kyocera Industrial Ceramics Corporation,
* L&W Engineering Co.,
* Motion Industries, Inc.,
* Omega Tool Corp.,
* ORIX Warren, LLC, and
* U.S. Timken Co.
The Objections have been resolved, overruled, or withdrawn.
The Claims Estimation Procedures will hasten claims
reconciliation and administration, John Wm. Butler, Jr., Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois,
avers.
Troy, Mich.-based Delphi Corporation -- http://www.delphi.com/--
is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology. The company's technology and
products are present in more than 75 million vehicles on the road
worldwide. The company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtor in
its restructuring efforts. Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtor's balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts. (Delphi Corporation Bankruptcy News, Issue No. 53;
Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).
DELTA AIR: US Airways Ups Offer to $10.2 Billion
------------------------------------------------
US Airways Group, Inc. disclosed Wednesday that it has increased
its offer to merge with Delta Air Lines, Inc.
Under the revised proposal:
* Delta's unsecured creditors would receive $5.0 billion in
cash and 89.5 million shares of US Airways stock.
* When applying the same valuation methodology and
assumptions as described in Delta's Disclosure Statement,
US Airways' advisor Citigroup estimates this new proposal
will provide between $12.7 and $15.4 billion in value to
Delta's unsecured creditors, which represents a significant
premium over the $9.4 to 12.0 billion valuation that Delta
places on its stand-alone plan.
* Based on the closing price of US Airways stock as of
Tuesday, Jan. 9, 2007, the new proposal has a current market
value of approximately $10.2 billion.
The merger is expected to be accretive to US Airways' earnings per
share in the first full year after completion of the merger.
The increased offer is set to expire on Feb. 1, 2007 unless there
is affirmative creditor support for commencement of due diligence,
making the required filings under Hart-Scott-Rodino, as well as
the postponement of Delta's hearing on its Disclosure Statement
scheduled for Feb. 7, 2007.
US Airways has committed financing from Citigroup and Morgan
Stanley for the proposed transaction for $8.2 billion,
representing $5.0 billion to fund the cash portion of the offer
and $3.2 billion in refinancing existing obligations at both US
Airways and Delta.
US Airways Chairman and Chief Executive Officer Doug Parker
stated, "While our original proposal offered substantially more
value to Delta's unsecured creditors than the Delta stand-alone
plan, we are making this revised offer to eliminate any doubt that
a merger with US Airways offers Delta's unsecured creditors
significantly more value. Without the support of the creditors,
our offer is set to expire on Feb. 1. It is time for this process
to move forward. We continue to believe that this is the right
time to create a better airline that provides more choice to
consumers, increased job security for both airlines' employees and
generates more value for all of our stakeholders."
Consumers across the nation will benefit from greater choice and
lower fares from the "New" Delta. Since the combination of
America West and US Airways in 2005, US Airways has lowered
leisure and business fares by up to 83 percent in about 1,000
markets. Every domestic destination served today by either US
Airways or Delta will continue to be served by the New Delta,
which will provide consumers across the nation access to a larger
network that connects them to more people and places.
Employees also will benefit from working for a larger and more
competitive airline. As US Airways has already announced,
frontline employees of the New Delta will move to the higher cost
structure of the combined airlines, and there will be no furloughs
of frontline employees of either Delta or US Airways. The
combination of US Airways and America West, which was accomplished
without any involuntary mainline furloughs despite capacity
reductions of 15 percent, demonstrates that a merger can be in the
best interests of employees, not just shareholders.
"This is a transaction that makes sense for US Airways
stockholders, Delta creditors, the employees and customers of both
companies, and the communities that we serve," said Mr. Parker.
The revised US Airways proposal retains the same conditions as the
original offer and is conditioned on satisfactory completion of a
due diligence investigation, which the company believes can be
completed expeditiously, approval by Delta's Bankruptcy Court of a
mutually agreeable plan of reorganization that would be predicated
upon the merger, regulatory approvals, and the approval of the
shareholders of US Airways.
Citigroup Corporate and Investment Banking is acting as financial
advisor to US Airways, and Skadden, Arps, Slate, Meagher & Flom
LLP is acting as primary legal counsel, with Fried, Frank, Harris,
Shriver & Jacobson LLP as lead antitrust counsel to US Airways.
About US Airways
Headquartered in Arlington, Virginia, US Airways Group Inc.'s
(NYSE: LCC) -- http://www.usairways.com/-- primary business
activity is the ownership of the common stock of:
* US Airways, Inc.,
* Allegheny Airlines, Inc.,
* Piedmont Airlines, Inc.,
* PSA Airlines, Inc.,
* MidAtlantic Airways, Inc.,
* US Airways Leasing and Sales, Inc.,
* Material Services Company, Inc., and
* Airways Assurance Limited, LLC.
Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts. In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts.
The Debtors' chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date.
US Airways, US Airways Shuttle, and US Airways Express operate
approximately 3,800 flights per day and serve more than
230 communities in the U.S., Canada, Europe, the Caribbean, and
Latin America. The new US Airways is a member of the Star
Alliance, which provides connections for customers to
841 destinations in 157 countries worldwide.
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 AIR: Claimholders Want US Airway's Revised Offer Considered
-----------------------------------------------------------------
In response to US Airways Group, Inc.'s revised offer to purchase
Delta Air Lines, Inc., the Unofficial Committee of Unsecured
Claimholders of Delta Air Lines, Inc. called upon the company to
provide thoughtful and unbiased consideration to US Airways'
enhanced offer.
The Unofficial Committee believes that it is in the best interests
of Delta and its stakeholders for Delta to immediately take these
steps:
1. Provide reasonable and customary access for US Airways to
perform its due diligence in a manner consistent with
similar transactions.
2. Fully cooperate with US Airways to make the required
filings under HSR.
3. Postpone Delta's Disclosure Statement hearing currently
scheduled for February 7, 2007 to allow Delta to fully
evaluate US Airways' proposal.
4. Include the active participation and input of the
Unofficial Committee's advisors with respect to the US
Airways' proposal and other strategic alternatives.
5. Desist from taking actions intended to deter other
companies from proposing transactions with Delta that may
result in greater creditor recoveries than under a stand-
alone Chapter 11 plan.
On its face, the revised offer by US Airways represents a
substantial increase from its prior bid, and, more importantly,
represents a significant premium to the valuation Delta itself
places on its stand-alone plan. The increased US Airways' offer
merits Delta's careful attention at this time in keeping with the
board's fiduciary duty to maximize value for Delta's stakeholders,
including members of the Unofficial Committee.
Only after Delta adequately considers the revised US Airways'
proposal and any other strategic alternative that may present
itself, will the members of the Unofficial Committee be in a
position to determine whether to support Delta's stand-alone
reorganization plan.
The Unofficial Committee's financial advisor is Jefferies &
Company, Inc., and its legal counsel is Paul, Weiss, Rifkind,
Wharton & Garrison LLP.
Delta's Board to Review Revised Proposal
Delta issued this preliminary statement based on its initial
assessment of the revised, unsolicited merger proposal from US
Airways:
"Delta's Board of Directors will fulfill its fiduciary duty to
review the revised unsolicited merger proposal announced today by
US Airways. On its face, the revised proposal does not address
significant concerns that have been raised about the initial US
Airways proposal and, in fact, would increase the debt burden of
the combined company by yet another $1 billion."
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. The Debtors filed
their Chapter 11 Plan and Disclosure Statement on Dec. 19, 2006.
A hearing to consider the adequacy of the Disclosure Statement is
set on Feb. 7, 2007.
DELTA AIR: S&P Says US Airway's New Offer Won't Affect Ratings
--------------------------------------------------------------
US Airways Group Inc. raised its acquisition bid for Delta to
$5 billion of cash and stock valued currently at $5.2 billion,
raising pressure on Delta, whose management seeks to reorganize as
an independent entity.
Standard & Poor's Ratings Services said its ratings on Delta,
including the 'D' corporate credit rating, are not affected.
Ratings on enhanced equipment trust certificates remain on
CreditWatch with developing implications, excepting 'AAA' rated,
insured EETCs, which are not on CreditWatch.
US Airways' revised bid would expire Feb. 1, 2007, unless the
Delta creditors' committee supports commencement of due diligence,
making required filings under the Hart-Scott-Rodino Act, and
postponement of Delta's Feb. 7, 2007, hearing on its disclosure
statement.
"The offer is likely to increase support among unsecured creditors
for exploring the acquisition bid, but Delta's [and possibly US
Airways'] labor groups are likely to continue to oppose the
merger, and any transaction would have to clear federal antitrust
review," said Standard & poor's credit analyst
Philip Baggaley.
"The increased US Airways' offer may also prompt competing
bids from other airlines, most likely UAL Corp. [B/Stable/--] or
possibly Northwest Airlines Corp. [rated 'D'], which, like Delta,
is in Chapter 11 but also expected to emerge in the second or
third quarter of 2007."
DEUTSCHE ALT-A: S&P Pares Rating on Class M-3 Debt to B from BB
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class
M-3 from Deutsche Alt-A Securities Inc. Mortgage Loan Trust Series
2003-4XS to 'B' from 'BB'.
Additionally, the ratings on the class M-2 and M-3 certificates
remain on CreditWatch with negative implications, where they were
placed Sept. 6, 2006. At the same time, the ratings on the
remaining classes from this transaction were affirmed.
The lowered rating on class M-3 reflects realized losses that have
outpaced excess spread. During the past seven remittance periods,
realized losses have outpaced excess spread by approximately 2x.
The failure of excess spread to cover monthly losses has caused a
continuous erosion of overcollateralization. As of the December
2006 distribution date, overcollateralization represented 0.15% of
the original pool balance, which is
below the target balance of 0.35%. Severely delinquent loans
represent 4.71% of the current pool balance, and cumulative
realized losses represent 0.72% of the original pool balance.
If losses continue to outpace excess spread, Standard & Poor's
will likely take additional negative rating actions.
Conversely, if excess spread increases to cover losses and
overcollateralization builds toward its target balance,
Standard & Poor's will affirm the ratings and remove them from
CreditWatch.
The affirmations are based on credit support percentages that are
sufficient to maintain the current ratings.
Credit support is provided by subordination,
overcollateralization, and excess spread. The underlying
collateral consists of conventional fixed-rate residential
mortgage loans secured by first liens on one- to four-family
residential properties. The mortgage loans have original terms to
maturity that are no greater than 30 years.
Rating Lowered And Remaining On Creditwatch Negative
Deutsche Alt-A Securities Inc.
Mortgage Loan Trust Series 2003-4XS
Rating
------
Class To From
----- -- ----
M-3 B/Watch Neg BB/Watch Neg
Rating Remaining On Creditwatch Negative
Deutsche Alt-A Securities Inc.
Mortgage Loan Trust Series 2003-4XS
Class Rating
----- ------
M-2 A/Watch Neg
Ratings Affirmed
Deutsche Alt-A Securities Inc.
Mortgage Loan Trust Series 2003-4XS
Class Rating
----- ------
A-4, A-5, A-6A, A-6B AAA
M-1 AA
DURA AUTOMOTIVE: Panel Wants Information Access Protocol Okayed
---------------------------------------------------------------
The Official Committee of Unsecured Creditors in DURA Automotive
Systems Inc. and its debtor affiliates' bankruptcy cases asks the
U.S. Bankruptcy Court for the District of Delaware to approve
procedures that will not require it to disseminate confidential
and privileged information to general unsecured creditors.
On April 20, 2005, as part of the Bankruptcy Abuse Prevention &
Consumer Protection Act of 2005, Congress enacted the new Section
1102(b)(3) of the Bankruptcy Code. Section 1102(b)(3) states, a
statutory creditors' committee appointed under Section 1102(a)
will "provide access to information for creditors who (i) hold
claims of the kind represented by that committee; and (ii) are not
appointed to the committee." Section 1102(b)(3)(B) provides that
the committee will also "solicit and receive comments from those
creditors.
Representing the Official Committee of Unsecured Creditors, M.
Blake Cleary, Esq., at Young Conaway Stargatt and Taylor LLP, in
Wilmington, Delaware, notes that Section 1102(b)(3) does not
indicate how a statutory creditors' committee should provide
"access," what "information" should be provided, or what it means
to "solicit and receive comments" from creditors. There is no
legislative history to Section 1102(b)(3) to provide guidance on
the application of this new provision, he adds.
The lack of specificity in Section 1102(b)(3) creates significant
issues for debtors and creditors committees, Mr. Cleary avers. He
relates that a debtor typically will share non-public information
with a creditors committee and its retained professionals.
Creditors committees use this information to assess, among other
things, a debtor's capital structure, opportunities for the
restructuring of the debtor's business in Chapter 11, the results
of any revised operations of the debtor in the bankruptcy case,
and the debtor's overall prospects for reorganization under a
Chapter 11 plan.
Statutory creditors committees are typically governed by
confidentiality provisions contained in their bylaws, which
prohibit its members from disclosing non-public information,
Mr. Cleary notes. Because of these bylaws or other arrangements
made with a debtor regarding confidentiality, a debtor can ensure
that the committee members will keep its information confidential
and will not use confidential information, except in connection
with the Chapter 11 case.
The enactment of Section 1102(b)(3) raises the issue of whether a
statutory creditors committee could be required to share a
debtor's confidential information or otherwise privileged
information with any creditor represented by that committee,
Mr. Cleary tells the Court.
The Creditors Committee also asks the Court to deem its members
and its advisors to be in compliance with Section 1102(b)(3) as a
result of the implementation of procedures that will govern the
dissemination of information to its constituency.
Pursuant to the Procedures, the Creditors Committee will establish
and maintain a Web site to make certain non-Confidential
Information and non-Privileged Information available to unsecured
creditors.
The information available on the Committee Web site will include:
* the Petition Date;
* the case number that relates to the Chapter 11 Cases;
* the contact information for the Debtors (and any
information hotlines that they establish), the Debtors'
counsel and the Committee's counsel;
* the date by which unsecured creditors must file their
proofs of claim;
* the voting deadline with respect to any Chapter 11 plan
filed in the Debtors' cases;
* access to the claims docket as and when established by the
Debtors or any claims and noticing agent retained in
the Debtors' cases;
* a general overview of the Chapter 11 process;
* press releases (if any) made by the Debtors or the
Committee;
* filings made by the Debtors with the Securities Exchange
Commission;
* the Debtors' monthly operating reports;
* a list of upcoming omnibus hearing dates;
* available transcripts from all hearings in the Chapter 11
cases;
* important pleadings and orders filed in the Chapter 11
cases;
* answers to frequently asked questions;
* links to other relevant Web sites; and
* any other information that the Committee, in its sole and
absolute discretion, deems appropriate which may include
contact information for entities that have appeared as
transferees of claims under Rule 3001(e)(2).
In addition to establishing the Web site, the Creditors Committee
will establish an e-mail address to allow unsecured creditors to
send questions and comments in connection with the Chapter 11
Cases. A link to this e-mail address will be made available on
the Web site.
Pursuant to the Procedures, within five business days of the
creation of the Web site, the Committee will work with the
Debtors' notice, claims and balloting agent, Kurtzman Carson
Consultants LLC, to serve a notice of the Procedures on those
parties listed in the Debtors' creditor matrix maintained by
Kurtzman.
The Creditor Notice will advise creditors of the of the entry of
the order approving the Procedures, the address of the Committee
Web site and the e-mail address established to allow unsecured
creditors to send questions and comments in connection with the
Chapter 11 Cases.
The Procedures will not authorize or require the Creditors
Committee to provide to any creditor or any other entity, access
to non-public information, including, without limitation,
(i) non-public information concerning the Debtors' assets,
liabilities, business operations, business practices,
business plans, intellectual property and trade secrets,
financial projections, financial and business analysis and
compilations and studies relating to the foregoing, unless
the information becomes generally available to the public
or is or becomes available to the Committee on a non-
confidential basis, in each case to the extent that the
information became so available other than by a known
violation of contractual, legal or fiduciary obligation to
the Debtors; and
(ii) Confidential Information -- communications among Committee
members in their capacity as such, including information
regarding specific positions taken by members and
communications among or between Members and Committee-
retained professionals.
In addition, the Procedures will not authorize or require the
Creditors Committee to provide any creditor or other entity with
any information subject to the attorney-client privilege or
similar state, federal or other jurisdictional law privilege,
whether the privilege is solely controlled by the Committee or is
a joint privilege with the Debtors or some other party; provided,
however, the Committee will be permitted, but not required, to
provide access to Privileged Information to any party provided
that:
(a) the Privileged Information is not Confidential
Information, and
(b) the relevant privilege is held and controlled solely by
the Committee.
The Procedures will not require the Creditors Committee to provide
access to information or solicit comments from any entity that has
not demonstrated to the satisfaction of the Committee, that it
holds claims of the kind described in Section 1102(b)(3) of the
Bankruptcy Code.
The proposed Procedures, Mr. Cleary asserts, will allow the
Creditors Committee to satisfy its obligation to provide access to
information for general unsecured creditors and to solicit
comments from the creditors, thereby allowing the Committee to
perform its statutory function.
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).
EASTPORT GOLF: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Eastport Golf Club, Inc.
4355 Eastport Boulevard
Little River, SC 29566
Bankruptcy Case No.: 07-00085
Type of Business: The Debtor operates a golf course.
Chapter 11 Petition Date: January 4, 2007
Court: District of South Carolina (Columbia)
Judge: John E. Waites
Debtor's Counsel: Julio E. Mendoza, Jr., Esq.
Nexsen Pruet Adams Kleemeier, LLC
1441 Main Street, Suite 1500
Columbia, SC 29201
Tel: (803) 771-8900
Fax: (803) 253-8277
Total Assets: $3,397,663
Total Debts: $2,390,823
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Fireman's Fund Insurance $2,354
Dept. CH 10284
Palatine, IL 60055
Accident Fund Insurance $516
Company of America
P.O. Box 77000
Dept. 77125
Detroit, MI 48277-0125
Eastport Community Assoc. Homeowner's $400
c/o Premier Group Association Fees
P.O. Drawer 2117
Myrtle Beach, SC 295782117
Estate Management Services Lake maintenance $291
305 Indigo Drive services
Brunswick, GA 31525
Waste Management Trade Creditor $259
P.O. Box 105453 (waste disposal)
Atlanta, GA 30348
Orkin Pest Control $44
P.O. Box 2586
Myrtle Beach, SC 29578
AT&T Phone Service Unknown
P.O. Box 9001310
Louisville, KY 40290-1310
Barry Hitchner, CPA Accounting Services Unknown
P.O. Box 470636
Charlotte, NC 28247
Bellamy Law Firm Legal Fees Unknown
P.O. Box 1901
Myrtle Beach, SC 29578
Farm Plan Trade Creditor Unknown
P.O. Box 4450 (equipment parts
Carol Stream, IL 601974450 and repairs)
Grand Strand Power Equipment Trade Creditor Unknown
1606 Plaza Place (repairs and
Myrtle Beach, SC 29577 maintenance on
golf course
equipment)
Helena Chemical Company Trade Creditor Unknown
P.O. Box 198153 (chemicals for golf
Atlanta, GA 30384 course)
Horry County Treasurer Hospitality Fee Unknown
1301 Second Avenue
Conway, SC 29526
Lady Bug Courier Service, Trade Creditor Unknown
Inc. (courier services)
4147 Fairway Drive
Little River, SC 29566
Lance, Inc. Trade Creditor Unknown
214634 Dist# 116 (snack bar supplies)
P.O. Box 473837
Charlotte, NC 28247
Lesco Trade Creditor Unknown
P.O. Box 530955
Atlanta, GA 30353
Little River Water & Sewer Water and Sewer Unknown
P.O. Box 68 Service
Little River, SC 295660068
Mid Atlantic Alarm & Trade Creditor Unknown
Surveillance, Inc. (alarm service)
P.O. Box 371
Chadbourn, NC 28431
NAPA AP - Little River Trade Creditor Unknown
4323 Old Hwy 17
Little River, SC 29566
Nash Oil Company, Inc. Trade Creditor Unknown
P.O. Box 161
North Myrtle Beach, SC 29597
EATZIS LLC: Assigns All Assets to Neligan Foley for Liquidation
---------------------------------------------------------------
Eatzi's LLC has assigned all of its assets to Patrick J. Neligan,
Jr., Esq., at Neligan Foley LLP for liquidation and distribution
to creditors.
Creditors have until Apr. 17, 2007, to submit consent to the
assignment and until June 17, 2007, to file proofs of claim
against Eatzi's.
The consent and proof of claim forms must be filed with the
assignee at this address:
Patrick J. Neligan, Jr. Esq.ss
Neligan Foley LLP
Suite 2600
1700 Pacific Avenue
Dallas, TX 75201
For questions, contact Kathy Gradick at (214) 840-5300.
Headquartered in Carrollton, Texas, Eatzi's LLC operates gourmet
food outlets under eatZi's Market & Bakery. The company has a
selection of wines, cheeses, and dairy products.
EMPLOYEES' BENEFIT: Case Summary & 5 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Employees' Benefit Association
2235 Northwest Savier
Portland, OR 97210
Bankruptcy Case No.: 06-34147
Chapter 11 Petition Date: December 29, 2006
Court: District of Oregon (Portland)
Judge: Elizabeth L. Perris
Debtor's Counsel: Albert N. Kennedy, Esq.
Tonkon Torp LLP
888 Southwest, 5th Avenue #1600
Portland, OR 97204
Tel: (503) 802-2013
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $100,000 to $1 Million
Debtor's Five Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Standard Insurance Co. Insurance premium $13,543
920 Southwest Sixth Avenue
Portland, OR 97204
SAIF Corporation Insurance premium $559
400 High Street Southeast
Salem, OR 97312
City of Portland Utilities Utilities $450
P.O. Box 4216
Portland, OR 97208
Integra Telecom Utilities $150
P.O. Box 3034
Portland, OR 97208
Comcast Utilities $50
9605 Southwest Nimbus Avenue
Portland, OR 97008
FINAL ANALYSIS: Selects Whiteford Taylor as Attorneys
-----------------------------------------------------
Final Analysis Communication Services Inc. asks the United States
Bankruptcy Court for the District of Maryland for permission to
employ Whiteford, Taylor & Preston LLP as its attorneys.
The professional services Whiteford Taylor is expected to perform
for the Debtor include:
a) providing the Debtor legal advice with respect to its
powers and duties as a debtor-in-possession and in the
operation of its business and management of its property;
b) representing the Debtor in defense of any proceedings
instituted to reclaim property or to obtain relief from
the automatic stay under Section 362(a) of the Bankruptcy
Code;
c) preparing any necessary applications, answers, orders,
reports and other legal papers, and appearing on the
Debtor's behalf in proceedings instituted by or against
the Debtor;
d) assisting the Debtor in the preparation of schedules,
statement of financial affairs, and any amendments thereto
which the Debtor may be required to file;
e) assisting the Debtor in the preparation of a plan and a
disclosure statement;
f) assisting the Debtor with other legal matters, including,
among others, securities, corporate, real estate, tax,
intellectual property, employee relations, general
litigation, and bankruptcy legal work; and
g) performing all of the legal services for the Debtor which
may be necessary or desirable.
Documents filed with the Court do not indicate how much Whiteford
Taylor will be paid for its services.
The Debtor submits that Whiteford Taylor does not represent any
interest adverse to the Debtor or its estate and is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Final Analysis
New York Satellite Industries, LLC, holds a majority interest in
Final Analysis Communication Services, Inc. Nader Modanlo, who
filed for Chapter 11 protection on July 22, 2005, owns NYSI.
Lanham, Md.-based Final Analysis filed a voluntary Chapter 11
petition on Dec. 29, 2006 (Bankr. D. Md. Case No. 06-18520) J.
Daniel Vorsteg, Esq., Paul M. Nussbaum, Esq., and Martin T.
Fletcher, Esq., at Whiteford, Taylor & Preston, LLP, represent the
Debtor. When it filed for bankruptcy, the Debtor estimated its
assets at more than $100 million and debts at $1 million to
$100 million.
FINAL ANALYSIS: Proofs of Claims Must be Submitted by May 7
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland set
May 7, 2007, as the deadline for all creditors owed money by Final
Analysis Communication Services Inc. to file formal written proofs
of claim on account of claims arising before Dec. 29, 2006.
Creditors must deliver their claim forms to the:
Clerk of the Bankruptcy Court
District of Maryland, Greenbelt Division
Suite 300
6500 Cherrywood Lane
Greenbelt, MD 20770
Tel: (301)344-8018
Governmental entities have until June 27, 2007, to file their
proofs of claim.
About Final Analysis
New York Satellite Industries, LLC, holds a majority interest in
Final Analysis Communication Services, Inc. Nader Modanlo, who
filed for Chapter 11 protection on July 22, 2005, owns NYSI.
Lanham, Md.-based Final Analysis filed a voluntary Chapter 11
petition on Dec. 29, 2006 (Bankr. D. Md. Case No. 06-18520)
J. Daniel Vorsteg, Esq., Paul M. Nussbaum, Esq., and Martin T.
Fletcher, Esq., at Whiteford, Taylor & Preston, LLP, represent the
Debtor. When it filed for bankruptcy, the Debtor estimated its
assets at more than $100 million and debts at $1 million to
$100 million.
FIRST HORIZON: Fitch Holds Low-B Ratings on Two Cert. Classes
-------------------------------------------------------------
Fitch Ratings affirms First Horizon Home Loan Mortgage Trust's
issues:
Series 2002-8:
-- Class A affirmed at 'AAA';
Series 2002-9:
-- Class A affirmed at 'AAA';
Series 2003-2:
-- Class A affirmed at 'AAA';
Series 2003-3:
-- Class A affirmed at 'AAA';
Series 2003-4:
-- Class A affirmed at 'AAA';
Series 2003-6:
-- Class A affirmed at 'AAA';
Series 2003-9:
-- Class A affirmed at 'AAA';
Series 2003-10:
-- Class A affirmed at 'AAA';
-- Class B1 upgraded to 'AAA' from 'AA';
-- Class B2 upgraded to 'AA-' from 'A';
-- Class B3 upgraded to 'A-' from 'BBB';
-- Class B4 upgraded to 'BBB' from 'BB'; and
-- Class B5 upgraded to 'B+' from 'B';
Series 2003-AR1:
-- Class A affirmed at 'AAA';
Series 2003-AR2:
-- Class A affirmed at 'AAA';
Series 2003-AR3:
-- Class A affirmed at 'AAA';
Series 2003-AR4:
-- Class A affirmed at 'AAA';
-- Class B-1 affirmed at 'AA+';
-- Class B-2 affirmed at 'A+';
-- Class B-3 affirmed at 'BBB+';
-- Class B-4 affirmed at 'BB+'; and
-- Class B-5 affirmed at 'B+'.
The mortgage loans consist of conventional 15- and 30-year fixed-
rate mortgages extended to prime borrowers and are secured by
first liens on one- to four-family residential properties. As of
the December 2006 distribution date, the transactions are seasoned
from a range of 37 to 49 months and the pool factors range from
approximately 9% to 65%. All of the above deals were acquired and
are serviced by First Horizon Home Loan Corporation, rated 'RPS2'
by Fitch.
The affirmations reflect credit enhancement consistent with future
loss expectations and affect approximately $1.410 billion of
outstanding certificates. The upgrades reflect an improvement in
the relationship between CE and future loss expectations and
affect approximately $5 million of outstanding certificates. The
CE levels for all the classes affected by the upgrades have at
least doubled their original enhancement levels since closing.
There have been no collateral losses to date.
Fitch will closely monitor these transactions.
FORD MOTOR: To Invest $866 Million in Six Michigan Plants
---------------------------------------------------------
Ford Motor Co. is producing more fuel-efficient vehicles by
investing $866 million to raise six Michigan plants, the
Associated Press reports.
Under the investment, $130 million would be spent for a stamping
and assembly plant in Wayne, $320 million for a transmission plant
in Van Dyke, $88 million for a transmission plant in Livonia,
$89 million for Woodhaven Stamping, $31 million for Dearborn
Stamping, and $208 million at a Dearborn plant.
In addition, Ford would receive state incentives of up to
$151 million and could get that amount matched by local
governments.
According to AP, the $151 million in tax abatements and other
incentives offered by the Michigan Economic Development Corp. is
based on Ford's billion-dollar commitment. The company has
reportedly said in August that it plans to invest up to
$1 billion in its Detroit operations.
Local governments also have considered offering another
$150 million to $170 million in incentives, AP adds.
Citing Ford President Mark Fields, AP relates that the investment
in new products and infrastructure will help the plants become an
avenue to build the best vehicles in the world.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures and distributes automobiles
in 200 markets across six continents. With more than 324,000
employees worldwide, including Mexico, the company's core and
affiliated automotive brands include Aston Martin, Ford, Jaguar,
Land Rover, Lincoln, Mazda, Mercury and Volvo. Its automotive-
related services include Ford Motor Credit Company and The Hertz
Corp.
* * *
As reported in the Troubled Company Reporter on Dec. 12, 2006,
Standard & Poor's Ratings Services affirmed its 'B' bank loan
and '2' recovery ratings on Ford Motor Co. after the company
increased the size of its proposed senior secured credit
facilities to between $17.5 billion and $18.5 billion, up
from $15 billion.
As reported in the Troubled Company Reporter on Dec. 7, 2006,
Fitch Ratings downgraded Ford Motor Company's senior unsecured
ratings to 'B-/RR5' from 'B/RR4' due to the increase in size of
both the secured facilities and the senior unsecured convertible
notes being offered.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Moody's Investors Service assigned a Caa1, LGD4, 62% rating to
Ford Motor Company's $3 billion of senior convertible notes
due 2036.
FREMONT HOME: S&P Holds Rating on Class B-2 Debenture at BB+
------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on five
classes from two transactions issued by Fremont Home Loan Trust.
At the same time, the ratings were affirmed on the remaining
classes from these transactions.
The raised ratings are the result of an updated loan-by-loan
analysis performed on the mortgage pool. The loss coverage levels
derived from the new loan-by-loan analyses were significantly
lower than the original levels at issuance, primarily because of
loan seasoning, updated FICO scores, and adjusted lower loan-to-
value ratios, due to property value appreciation. As a result,
Standard & Poor's raised certain ratings to reflect the credit
support provided at the new, lower loss coverage levels.
The affirmations are based on loss coverage percentages that are
sufficient to maintain the current ratings. Standard & Poor's
will continue to monitor these transactions to ensure the assigned
ratings accurately reflect the risks associated with them.
Ratings Raised
Fremont Home Loan Trust
Rating
------
Series Class To From
------ ----- -- -----
2004-1 M-2 AAA AA+
2004-1 M-3 AA+ AA
2004-2 M-1 AAA AA+
2004-2 M-2 AA+ AA
2004-2 M-3 AA AA-
Ratings Affirmed
Fremont Home Loan Trust
Series Class Rating
------ ----- ------
2004-1 M-1 AAA
2004-1 M-4 AA-
2004-1 M-5 A+
2004-1 M-6 A
2004-1 M-7 A-
2004-1 M-8 BBB+
2004-1 M-9 BBB
2004-1 B BBB-
2004-2 II-A3 AAA
2004-2 M-4 A+
2004-2 M-5 A
2004-2 M-6 A-
2004-2 M-7, M-8 BBB+
2004-2 M-9 BBB
2004-2 B-1 BBB-
2004-2 B-2 BB+
GLOBAL LEVERAGED: Moody's Rates $25 Million Class I Notes at B2
---------------------------------------------------------------
Moody's Investors Service assigned these ratings to Notes and
Combination Securities issued by Global Leveraged Capital Credit
Opportunity Fund I:
-- Aaa to $265,000,000 Class A First Priority Senior Notes Due
2018;
-- Aa2 to $39,000,000 Class B Second Priority Senior Notes Due
2018;
-- A2 to $40,500,000 Class C Third Priority Subordinated
Deferrable Notes Due 2018;
-- Baa2 to $23,750,000 Class D Fourth Priority Subordinated
Deferrable Notes Due 2018;
-- Ba2 to $18,500,000 Class E-1 Fifth Priority Subordinated
Deferrable Notes Due 2018;
-- Ba2 to $7,750,000 Class E-2 Fifth Priority Subordinated
Deferrable Notes Due 2018;
-- B2 to $25,000,000 Class I Combination Notes Due 2018;
-- Aaa to $1,000,000 Class P-1 Principal Protected Notes Due
2018; and
-- Aa3 to SGD13,200,000 Class P-2 Principal Protected Notes
Due 2018.
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 Moody's rating of the
Combination Notes addresses the ultimate receipt of the initial
Class I Combination Note Outstanding Balance and payments of the
Class I Combination Note Notional Interest Rate and the Moody's
ratings of the Principal Protected Notes address only the ultimate
receipt of the Notes' Rated Balance.
The ratings reflect the risks due to the diminishment of cash flow
from the underlying portfolio consisting primarily of senior
secured loans, mezzanine obligations, distressed obligations due
to defaults, the transaction's legal structure and the
characteristics of the underlying assets.
Global Leveraged Capital, LLC will manage the selection,
acquisition and disposition of collateral on behalf of the Issuer.
This transaction was underwritten by Merrill Lynch.
GOODYEAR TIRE: Workers' Strike Could Result in $350 Million Loss
----------------------------------------------------------------
The Goodyear Tire & Rubber Co. disclosed that a recent strike at
12 of its U.S. tire factories would result in a loss of at least
$350 million, BBC News reports.
About 15,000 workers refused to work for two months, protesting
threats to jobs and health benefits. The dispute, which may have
cost the company up to $35 million a week in lost production and
sales, was settled in early January, BBC states.
However, Goodyear's shares rose by 1% after the company revealed
that it expects to save $610 million in the wake of new worker
contracts, BBC relates.
"We recognize that there were short-term negatives from the
strike," Goodyear CEO Robert Keegan said. "However, on balance,
the improvements in our system far outweigh those negatives."
According to the report, the company will set up a fund to pay for
healthcare for retired staff under the deal agreed by unions
earlier this month, but will probably close a plant in Texas by
2008.
Goodyear warned that the full financial brunt of the strike will
be reflected in its fourth quarter results due to be published in
February. Experts predict a substantial loss for the three-month
period, BBC reports.
Headquartered in Akron, Ohio, The Goodyear Tire & Rubber Company
(NYSE: GT) -- http://www.goodyear.com/-- is the world's largest
tire company. The company manufactures tires, engineered rubber
products and chemicals in more than 90 facilities in 28 countries.
Goodyear Tire has marketing operations in almost every country
around the world including Chile, Colombia, Guatemala and Peru in
Latin America. Goodyear employs more than 80,000 people
worldwide.
* * *
As reported in the Troubled Company Reporter on Jan. 9, Fitch
Ratings affirmed its ratings on Goodyear Tire & Rubber Co. and
removed them from Rating Watch Negative where they were placed on
Oct. 18, 2006, when the company announced a $975 million drawdown
of its bank revolver. Fitch affirmed Goodyear's Issuer Default
Rating at B. Fitch said the Rating Outlook is Negative.
GOLD KIST INC: Posts $17.7 Million Net Loss in Year Ended Sept. 30
------------------------------------------------------------------
Gold Kist Inc. reported net sales of $2.1 billion for the fiscal
year ended Sept. 30, 2006, a decline of 7.7%, compared with net
sales of $2.3 billion for the fiscal year ended Oct. 1, 2005.
Net operating loss for fiscal 2006 was $27.5 million compared with
net operating income of $205.6 million for the year ended Oct. 1,
2005.
Net loss for the fiscal year ended Sept. 30, 2006, was
$17.7 million, compared with net income of $112.2 million for
fiscal year 2005. Adjusted net loss for the fiscal year ended
Sept. 30, 2006, was $11 million.
Adjusted net loss is a non-GAAP measure that excludes share-based
compensation expense, costs associated with the unsolicited
acquisition proposal, and exploration of strategic alternatives
and proceeds from antitrust settlements incurred or received
during the fiscal year.
"Conditions in the poultry industry changed significantly in
fiscal 2006 following the two best years in the company's
history," president and chief executive officer John Bekkers said.
"In fiscal 2006, an oversupply of broilers and competing meats led
to a decline in broiler prices. The decrease in net sales was due
to a decline of 8.3 percent in average broiler prices for fiscal
2006. We believe concern about avian influenza in export markets
was the primary cause for reduced consumption in those markets,
which further contributed to greater domestic supply and lower
sales prices for the year.
"Processing costs continued to increase for the fiscal year due to
higher utilities, freight and packaging costs," Bekkers added.
"Total feed costs were slightly lower in fiscal 2006 due to a
10.8% decrease in soybean meal costs, which offset a 5.1% increase
in the cost of corn. Feed costs are expected to increase in the
first half of fiscal 2007 due to higher corn prices resulting from
the increased demand for alternative energy production and the
reduction in corn crop estimates by the USDA.
"We continue to believe that our strategy of increasing value-
added and private-label products, along with improving
productivity, will help offset some of the impact of the latest
industry downturn.
"With the opening in November 2006 of a $70 million,
180,000-square-foot expansion at our poultry processing facility
in Live Oak, Florida, and the September 2006 opening of our
$30 million, 80,000-square-foot expansion in Guntersville,
Alabama, we mark the completion of two important steps in the
execution of our strategic capital expenditure plan. Both of
these plants add substantial capacity for producing value-added
products and products that will be sold at retail markets under
private labels."
About Gold Kist
Based in Atlanta, Georgia, Gold Kist Incorporated (NASDAQ: GKIS)
-- http://www.goldkist.com/-- operates a fully integrated chicken
production, processing and marketing business. Gold Kist's
production operations include nine divisions located in Alabama,
Florida, Georgia, North Carolina and South Carolina
* * *
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Standard & Poor's Ratings Services reported that its 'B+'
corporate credit rating and other ratings on poultry processor
Gold Kist Inc. remain on CreditWatch with positive implications,
where they were originally placed Aug. 21, 2006.
GP INVESTMENTS: Fitch Rates $150 Million Notes at B
---------------------------------------------------
Fitch rates GP Investments Ltd. as:
-- Foreign currency Issuer Default rating 'B'; and,
-- Intended issue of $150 million of perpetual notes
'B/RR4'.
The Rating Outlook is Stable.
GP's ratings are supported by conservative leverage levels, the
franchise of the company and the experience of the management team
which bodes well for positive prospects going forward. The
ratings are constrained, however, by the highly concentrated
nature of the intended investment portfolio, the negative cash
flow implied by recurring fixed expenses versus recurring income,
and the uncertainty related to the maturation period of the
investment portfolio and GP's ability to realize investment gains.
GP is a Bermuda exempted company that consolidates the activities
of a private equity business and an asset management business in
Brazil. The company's activities started in 1993 as an asset
manager dedicated to private equity activities, managed by
partners with substantial experience in the Brazilian market. A
major corporate reorganization was completed in 2005 in
preparation to an IPO of the company during year 2006. The
company is listed on the Luxembourg Stock Exchange and also has a
BDS program on the Brazilian Stock Market.
Since 1993, GP has built up a successful track record in the
Brazilian private equity market, having invested more than
$1.4 billion in 40 companies in Brazil as of December 2006. Over
time the company has refined its investment strategies. It
currently looks to acquire investments only with control or joint
control positions, with a preference for larger companies, and
will not invest in start-ups and green field projects; while some
limits regarding maximum exposures by company or sector are in
place, GP's investment portfolio is, and will remain, highly
concentrated.
As of end September 2006, GP managed a portfolio of two
investments and has reported the subscription of 4 additional
investments. The significant reduction in the size of the
investment portfolio down to $83 million at end-September 2006, is
the result of the reorganization process completed in 2006, where
the company spun off the bulk of its previous investments in three
other private equity funds and also completed the subscription of
$308 million in new capital through the successful IPO in the
Brazilian and Luxembourg stock market. The proceeds are expected
to be used to fund new investments in the private equity business.
In addition to its private equity business, the company through
its subsidiary GP Asset offers services focused on creating and
managing alternative fixed-income, equity and multi-asset funds to
institutional clients, financial intermediaries, private clients
and investment vehicles in Brazil. This business provides an
important portion of the recurring income of the company, though
historically total recurring income has not been sufficient to
cover operating expenses, which have been funded through the
income generated by the positive results of the valuation and
exits in the investment portfolio and the maintenance of liquidity
on hand for these purposes.
Given the unpredictable nature of the results and timing of
capital gains in the investment portfolio or of the possible
positive results in future exits of those investments and the
concentration of the portfolio, Fitch Ratings believes that a more
ample array of recurring income would be needed to sustain current
operating expenses, which will include debt service after the
issue, and enhance the risk profile of the company.
The perpetual notes will have no fixed final maturity date and
will be repaid only in the event that the Issuer redeems the notes
or upon acceleration due to an event of default. The notes will
be general unsubordinated obligations of the Issuer and will rank
'pari passu' with the issuer's unsubordinated indebtedness. The
obligations of the Issuer under the notes will be secured by a
first priority pledge by the Issuer of shares representing 100% of
the currently outstanding shares of GP Private Equity Ltd., and
liquidity will be supported by an 18 month coupon payment reserve
which will be deposited in a trustee. The rating of the issuance
recognizes the liquidity implicit in the coupon reserve, augmented
by substantial cash currently on hand, nevertheless, the concern
is that the latter is intended to be used for investments, and its
availability at any point during the life of the debt instrument
is difficult to predict.
GRANITE BROADCASTING: Can Access $25 Mil. DIP Financing from SPCP
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved, on a final basis, Granite Broadcasting Corp. and its
debtor-affiliates' request to obtain secured postpetition
financing of up to $25,000,000 from SPCP Group III LLC and SPCP
Group LLC.
The Debtors are authorized to immediately obtain the DIP loans,
pursuant to the terms of the final order and subject to the terms
of the DIP loan documents. Available financing and advances
under the DIP financing agreement will be made to fund ongoing
working capital requirements of the Debtors.
Adequate Protection
As adequate protection for the use of the prepetition collateral,
including the cash collateral, the Debtors grant valid, perfected,
second priority postpetition security interests in and liens on
all of the collateral to:
(1) the Existing Senior Collateral Agent, for the Existing
Senior Lenders' benefit; and
(2) the Existing Senior Noteholder Trustee, for the Existing
Senior Noteholders' benefit.
The existing senior replacement liens will only be and remain
subject and subordinate to:
(i) the postpetition liens and payment of any DIP Obligations
on its account;
(ii) the permitted priority liens; and
(iii) during the occurrence and continuance of an event of
default, the payment of the carve-out.
The Existing Senior Replacement Liens granted to the Existing
Senior Collateral Agent are pari passu with the Existing Senior
Replacement Liens granted to the Existing Senior Noteholder
Trustee, with the exception of the Binghamton collateral that
will be determined in accordance with the existing senior debt
documents.
The Existing Senior Replacement Liens will not at any time prior
to the full satisfaction in cash of all DIP Obligations and
existing senior adequate protection obligations be made subject
or subordinated to, or be made pari passu with any other lien,
security interest or claim other than the permitted priority
liens, or be subject to any lien or security interest that is
avoided and preserved for the benefit of the Debtors' estates.
To the extent of the existing senior collateral value diminution,
if any, the Existing Senior Agents and the Existing Senior
Noteholder Trustee are also granted an allowed superpriority
administrative claims, having priority over any other claims,
which will be:
-- payable from and have recourse to all property of the
Debtors and all its proceeds, including those recovered in
connection with any avoidance actions or other actions
arising under Chapter 5 of the Bankruptcy Code;
-- junior in priority only to the Superpriority Claim held by
Silver Point Finance, LLC, as DIP Agent, for the benefit
the DIP Lenders; and
-- subject only to the payment of the DIP Obligations and
during the occurrence and continuance of an Event of
Default, payment of the Carve-Out.
On December 15, 2006, immediate payment in cash of all accrued
and unpaid fees, costs and expenses in respect of the existing
senior loan indebtedness and the existing senior noteholder
indebtedness, and all other fees, costs and disbursements accrued
and unpaid under any of the Existing Senior Debt Documents as of
December 15, and the reasonable fees and expenses of counsel to
the Existing Senior Agents and the Existing Senior Noteholder
Trustee. All the fees, costs and expenses, other than the fees
and expenses of counsel for the Existing Senior Agents and the
Existing Senior Noteholder Trustee, will be deemed fully earned,
nonrefundable, and irrevocable as of December 15.
The Existing Senior Agents and the Existing Senior Noteholder
Trustee will receive current cash payment of their fees, costs
and expenses, including Milbank, Emmet, Marvin & Martin LLP, and
one financial advisor to the Existing Senior Administrative
Agent. The payment of all accrued fees, costs, and expenses will
not be subject to challenge, recharacterization or reduction.
Any objections to the fees must be made in writing to the
Existing Senior Agents and the Existing Senior Noteholder Trustee
immediately after the delivery of their invoices.
Limitations on Professional Expenses
Any official committee of unsecured creditors and any party-in-
interest will be entitled until March 6, 2007, to investigate the
validity, perfection, enforceability, and extent of the Existing
Senior Liens and the Existing Senior Loan Indebtedness and any
potential claims of the Debtors or their estates against the
Existing Senior Agents, the Existing Senior Lenders, the Existing
Senior Noteholder Trustee, and the Existing Senior Noteholders.
The carve-out expenses, cash collateral, and proceeds of the DIP
loans may be used only up to $50,000 in the aggregate for the
payment of any fees of the Creditors Committee incurred in
connection with their investigation.
In no event during the course of the Debtors' Chapter 11 cases
will actual payments of the aggregate fees and expenses of all
professional persons retained by the Creditors Committee exceed
$450,000 in the aggregate. If a committee of equity security
holders is appointed but a Creditors Committee is not, then the
Creditors Committee Expense Cap will apply to the Equity
Committee and its professionals and that Equity Committee will be
entitled to the entire $50,000 of the Committee litigation fund.
In the event that both an Equity Committee and a Creditors
Committee are appointed, then the $450,000 Creditors Committee
Expense Cap will apply to both Committees, divided based on an
allocation agreed to by both or approved by the Court. The
$50,000 Creditors Committee Investigation Fund will apply first
to the fees and expenses of the Creditors Committee and second to
the Equity Committee.
Under all circumstances, the Creditors Committee Investigation
Fund will be deducted from, and will reduce dollar-for-dollar the
Creditors Committee Expense Cap, irrespective of whether the
funds are used by the Creditors Committee, the Equity Committee,
or both.
Any challenge to the Existing Senior Liens or the assertion of
any other claims or causes of action of the Debtors or their
estates against any of the Existing Senior Agents, the Existing
Senior Lenders, the Existing Senior Noteholder Trustee, or the
Existing Senior Noteholders must be made by commencing an
adversary proceeding on or before the investigation termination
date.
No action, inaction or acquiescence by the DIP Agent, the DIP
Lenders, the Existing Senior Agents, the Existing Senior Lenders,
the Existing Senior Noteholder Trustee, or the Existing Senior
Noteholders will be deemed to be evidence of any of their alleged
consent to a charge against the Collateral. The DIP Agent, the
DIP Lenders, the Existing Senior Agents, the Existing Senior
Lenders, the Existing Senior Noteholder Trustee or the Existing
Senior Noteholders will not be subject in any way to the
equitable doctrine of "marshaling" or any similar doctrine with
respect to the Collateral.
Injunction
Until the DIP Obligations and the Existing Senior Adequate
Protection Obligations are indefeasibly paid in full, in cash,
and completely satisfied, the Debtors will be enjoined and
prohibited from granting liens on the Collateral or any portion
of it to any other parties, which liens are:
* senior to, pari passu with, or junior to the liens granted
to the DIP Agent, for the DIP Lenders' benefit; or
* senior to, pari passu with, or junior to the liens granted
to the Existing Senior Collateral Agent, for the Existing
Senior Lenders' benefit, and to the Existing Senior
Noteholder Trustee for the Existing Senior Noteholders'
benefit.
Any objections that have not previously been withdrawn or
resolved are overruled on their merits.
About Granite Broadcasting
Headquartered in New York, Granite Broadcasting Corp.
-- http://www.granitetv.com/-- owns and operates, or provides
programming, sales and other services to 23 channels in 11
markets: San Francisco, California; Detroit, Michigan; Buffalo,
New York; Fresno, California; Syracuse, New York; Fort Wayne,
Indiana; Peoria, Illinois; Duluth, Minnesota-Superior, Wisconsin;
Binghamton, New York; Utica, New York and Elmira, New York. The
company's channel group includes affiliates of NBC, CBS, ABC, CW
and My Network TV, and reaches approximately 6% of all U.S.
television households.
The company and five of its debtor-affiliates filed for chapter 11
protection on Dec. 11, 2006 (Bankr. S.D.N.Y. Case No. 06-12984).
Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP,
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, it estimated
assets of $443,563,020 and debts of $641,100,000. (Granite
Broadcasting Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
GRANITE BROADCASTING: Court Gives Final Nod on Cash Collateral Use
------------------------------------------------------------------
The Hon. Allan Gropper of the United States Bankruptcy Court for
the Southern District of New York authorized Granite Broadcasting
Corp. and its debtor-affiliates, on a final basis, to use cash
collateral, which will terminate on the occurrence, at the
earliest of:
(a) regardless of whether or not the DIP loan documents are
effective at the time:
* the Debtors' breach of any covenant under the DIP Loan
Documents, which is not cured within its terms; or
* an event of default will have occurred under the DIP
Loan Documents;
(b) the earlier date on which the DIP Loans will become due
and payable; and
(c) the date on which all commitments have been terminated
under the Final Order and the DIP Loan Documents.
The Debtors are authorized and directed to remit to Silver Point
Finance, LLC, as DIP Agent, or the DIP Lenders 100% of all
collections on, and proceeds of, the Collateral, including all
accounts receivable collections, proceeds of sales of inventory,
fixed assets, or any other assets, and all other cash or cash
equivalents which will at any time come into the possession or
control of the Debtors, or to which the Debtors will become
entitled at any time.
The automatic stay provisions are modified to permit the DIP
Agent or the DIP Lenders to retain and apply all Collateral
collections, remittances, and proceeds in accordance with the
Final Order in connection with making any investigation.
Any challenge to the Existing Senior Liens or the assertion of
any other claims or causes of action of the Debtors or their
estates against any of the Existing Senior Agents, the Existing
Senior Lenders, the Existing Senior Noteholder Trustee, or the
Existing Senior Noteholders, must be made by commencing an
adversary proceeding before the investigation termination date.
Financing Agreements
As reported in the Troubled Company Reporter on Dec. 15, 2006,
Prior to filing for bankruptcy, the Debtors were parties to two
secured financing arrangements:
(1) a senior note indenture among Granite, certain
of its subsidiaries, and The Bank of New York, dated
December 22, 2003, under which 9.75% Debentures in the
aggregate principal amount of $405,000,000 are due on
December 1, 2010; and
(2) a credit and guaranty agreement with various financial
institutions, Bank of New York, and Silver Point Finance,
LLC, which provides for a $40,000,000 Tranche A term loan
and a $30,000,000 convertible Tranche B term loan.
As of its bankruptcy filing, the Debtors owe:
-- not less than $405,000,000, plus accrued and unpaid
interest of at least $20,899,582, plus fees, costs, and
expenses incurred under the Senior Notes Indenture; and
-- not less than $70,000,000 plus accrued and unpaid interest
of at least $273,287, plus fees, costs, and expenses
incurred under the Senior Credit Agreement.
Bank of New York is the indenture trustee of the Existing Senior
Notes and is the collateral agent for the existing senior lenders
under the Existing Senior Credit Agreement.
Silver Point is the administrative agent for the Existing Senior
Lenders.
Cash Collateral
The Debtors granted first priority liens and security interests
in favor of Bank of New York, as the Existing Senior Noteholder
Trustee and as the Existing Senior Collateral Agent, on a
prepetition collateral.
With the exception of the Binghamton assets, the Existing Senior
Lender liens are pari passu with the Existing Senior Noteholder
liens.
The Debtors require the use of the cash collateral pledged to
secure repayment of their debt obligations to make payroll and to
satisfy other working capital and operational needs.
Pursuant to Section 363(c)(2) of the Bankruptcy Code, a
debtor-in-possession may not use cash collateral without the
consent of the secured party or court approval.
Monthly Cash Budget
The Debtors will limit their use of cash collateral to amounts
specified in a Monthly Budget commencing with the calendar month
ending Dec. 31, 2006. A copy of that Budget is available at
no charge at http://ResearchArchives.com/t/s?1707
The existing senior agents and the existing senior lenders
consent to the Debtors' use of Cash Collateral and the priming of
their liens, subject to the adequate protection liens and
payments.
Adequate Protection
The Debtors propose to grant Bank of New York replacement liens
that will be, and remain subject and subordinate to:
(i) postpetition liens and payment of any Debtor-in-Possession
obligations on its account;
(ii) permitted priority liens; and
(iii) during the occurrence and continuance of an event of
default payment of the carve-out.
The Existing Senior Replacement Liens granted to the Existing
Senior Collateral Agent are pari passu with the Existing Senior
Replacement Liens granted to the Existing Senior Noteholder
Trustee, except that with respect to the Binghamton collateral,
the priority of the Existing Senior Replacement Liens among the
Existing Senior Collateral Agent and the Existing Senior
Noteholder Trustee will be determined in accordance with the
existing senior debt documents.
Furthermore, the Debtors propose to grant the Existing Senior
Agents, the Existing Senior Lenders, the Existing Senior
Noteholder Trustee and the Existing Senior Noteholders:
* valid, perfected second priority postpetition security
interests in and liens on all of the Collateral, to secure
an amount equal to the aggregate diminution in the value
or amount of their respective interests in the Prepetition
Collateral;
* an allowed super-priority administrative expense claim, as
provided for in Section 507(b), subject only to the
payment of the Debtors' DIP Financing obligations, and (b)
during the occurrence and continuance of an Event of
Default, payment of the Carve-Out;
* immediate cash payment of all accrued and unpaid fees,
costs and expenses, including reasonable fees and expenses
4of the Existing Senior Agents' and the Existing Senior
Noteholder Trustee's counsel;
* interest on the Existing Senior Loan Indebtedness or other
unpaid amounts to accrue at a default rate set forth in
the Existing Senior Credit Agreement if the aggregate
value of the Prepetition Collateral provided for the
Existing Senior Lenders exceeds the aggregate value of the
Existing Senior Loan Indebtedness; and
* interest on the Existing Senior Notes Indebtedness or
other unpaid amounts to accrue at the default rate set
forth in the Existing Senior Notes Indenture, and
prepayment premiums owing under the Existing Senior Notes
Indenture, to the extent the aggregate value of the
Prepetition Collateral provided to the Existing Senior
Noteholders exceeds the aggregate value of the Existing
Senior Notes Indebtedness.
About Granite Broadcasting
Headquartered in New York, Granite Broadcasting Corp.
-- http://www.granitetv.com/-- owns and operates, or provides
programming, sales and other services to 23 channels in 11
markets: San Francisco, California; Detroit, Michigan; Buffalo,
New York; Fresno, California; Syracuse, New York; Fort Wayne,
Indiana; Peoria, Illinois; Duluth, Minnesota-Superior, Wisconsin;
Binghamton, New York; Utica, New York and Elmira, New York. The
company's channel group includes affiliates of NBC, CBS, ABC, CW
and My Network TV, and reaches approximately 6% of all U.S.
television households.
The company and five of its debtor-affiliates filed for chapter 11
protection on Dec. 11, 2006 (Bankr. S.D.N.Y. Case No. 06-12984).
Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP,
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, it estimated
assets of $443,563,020 and debts of $641,100,000. (Granite
Broadcasting Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
GREGORY ROSE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Gregory Allen Rose
aka Electrum, Inc.
aka Rockwood Environmental Systems, Inc.
aka Spectrum Electric
aka Sunset Marine
aka SCRAGR, LLC
2050 Vista, Suite 100
Salem, OR 97302
Bankruptcy Case No.: 06-62681
Chapter 11 Petition Date: December 26, 2006
Court: District of Oregon (Eugene)
Judge: Albert E. Radcliffe
Debtor's Counsel: Loren S. Scott, Esq.
Muhlheim Boyd
88 East Broadway
Eugene, OR 97401
Tel: (541) 868-8005
Fax: (541) 868-8004
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Service Lighting Joint Venture $600,000
P.O. Box 3880
Central Point, OR 97502
Willamette Electric Group, Inc. Breach of Contract $500,000
888 Southwest Canyon Road
Suite 110
Portland, OR 97225
Steve Hunt Loan $200,000
P.O. Box 3880
Central Point, OR 97502
Synergy Construction, Inc. Breach of Contract $118,436
14040 Northeast 181st Street
Woodinville, WA 98072
Tom Fergusson Loan $90,000
15120 Southwest Chrisden Court
Salem, OR 97302
Jim Strauch $85,000
Weston Group Lawsuit $85,000
George M. Roth Wage Lawsuit $65,904
Tim Albers Breach of Contract $43,077
John Rice Loan $35,000
MNOP Oil & Gas Co. Gas Cards $35,000
Chuck Dunn Loan $30,000
Ronald A. Leffner Wage Lawsuit $26,299
Dennis R. Hauserman Wage Lawsuit $23,096
David Bloom Loan $15,000
Josh Bowe Wage Lawsuit $12,960
Corey L. Cox Wage Lawsuit $12,291
Jana K. Michelson Wage Lawsuit $8,375
Cory Redding Lease Payments $4,181
Stewart Hanes, CPA Accountant Fees $4,000
GORDON CRAWFORD: Case Summary & Six Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Gordon Lee Crawford, II
dba Crawford Enterprises
fdba Western Sand and Gravel, LLC
16304 Morrison Road
Oakdale, CA 95361
Bankruptcy Case No.: 06-90848
Chapter 11 Petition Date: December 22, 2006
Court: Eastern District of California (Modesto)
Judge: Robert S. Bardwil
Debtor's Counsel: Malcolm D. Gross, Esq.
214 East F Street, Suite 203
Oakdale, CA 95361
Tel: (209) 847-7061
Fax: (209) 847-3622
Total Assets: $5,888,540
Total Debts: $2,535,909
Debtor's Six Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Bobby Crawford $28,000
16304 Morrison Road
Oakdale, CA 95361
Internal Revenue Service $22,409
MS 5114-SLC
50 South 200 East
Salt Lake City, UT 84111-1617
OMC Finance $10,000
Dale Olstrander
1031 McHenry Avenue, Suite 1
Modesto, CA 95350
Bill Bartha $6,000
701 5th Street
Modesto, CA 95351
Aspen Survey $5,500
1121 Oakdale Road, Suite 5
Modesto, CA 95355
Bank of America $2,000
Visa - Alaska Airlines
P.O. Box 60069
City of Industry, CA 91716-0069
HANOVER COMPRESSOR: Completes Partial Redemption of $20.8MM Notes
-----------------------------------------------------------------
Hanover Compressor Co. reported completion of the partial
redemption of $20,871,000 aggregate principal amount of
Convertible Junior Subordinated Debentures Due 2029.
All of the Debentures are owned by Hanover Compressor Capital
Trust and the Trust was required to use the proceeds received from
such redemption to redeem $20,245,000 aggregate liquidation amount
of its 7-1/4% Convertible Preferred Securities and $626,000
aggregate liquidation amount of its 7-1/4% Convertible Common
Securities.
The company owns all of the Common Securities of the Trust.
The Debentures were called on Dec. 15, 2006, for redemption on
Thursday, Jan. 4, 2007.
Of the $20,245,000 of TIDES Preferred Securities called,
$20,052,700 was converted into 1,121,800 shares of Hanover Common
Stock. Hanover expects its related annual interest expense to be
reduced by approximately $1.5 million.
Hanover Compressor Company (NYSE:HC) -- http://www.hanover-co.com/
-- is a full service natural gas compression and provider of
service, fabrication, and equipment for oil and natural gas
production, processing and transportation applications. Hanover
sells and rents this equipment and provides complete operation and
maintenance services, including run-time guarantees for both
customer-owned equipment and its fleet of rental equipment.
* * *
On Oct. 20, 2006, Moody's Investors Service upgraded the rating of
Hanover Compressor Company's 8.625% Senior Unsecured Gtd. Notes
Due 2010; 9% Senior Unsecured Gtd. Notes Due 2014; and
7.5% Senior Unsecured Gtd. Notes Due 2013 to B2.
HEADWATERS INC: Seeking to Amend Senior Secured Credit Agreement
----------------------------------------------------------------
Headwaters Inc. is seeking a technical amendment to its senior
secured credit agreement to provide the company with additional
flexibility with respect to certain restricted payments, including
a $15 million basket for the payments, and for non-speculative
hedging transactions.
Headquartered in South Jordan, Utah, Headwaters Incorporated
(NYSE:HW) -- http://www.hdwtrs.com/-- is a diversified growth
company providing products, technologies and services to the
energy, construction and home improvement industries. Through its
alternative energy, coal combustion products, and building
materials businesses, the company earns a growing revenue
stream that provides the capital needed to expand and acquire
synergistic new business opportunities.
* * *
As reported in the Troubled Company Reporter on Aug 1, 2006,
Standard & Poor's Ratings Services affirmed its 'BB-' senior
secured bank loan and '2' recovery ratings on Headwaters Inc.'s
$700 million credit facility and removed them from CreditWatch,
where they were placed with positive implications on June 20,
2006.
IMC INVESTMENT: Files Amended Disclosure Statement on Ch. 11 Plan
-----------------------------------------------------------------
IMC Investment Properties Inc. delivered an amended disclosure
statement describing its Chapter 11 Plan of Reorganization with
the U.S. Bankruptcy Court for the Northern District of Texas.
Treatment of Claims
Pursuant to the Amended Disclosure Statement, each holder of an
Allowed Priority Unsecured Claim will be paid in one cash payment
on the later of:
1) the effective date of the Plan or when the claim is first
due and payable; and
2) 15 business days following the date the Claim is allowed by
final order.
The Class 2A Claims of Taxing Authorities are entitled to a
secured claim and a lien on the Debtor's multi-purpose office
building located at 6221 Riverside Drive in Las Colinas, Texas and
all rents on that property in the order of priority as existed on
the Debtor's bankruptcy filing.
(b) Class 2B and 2C - Compass Bank Secured Claim.
On or before the effective date of the Plan, the Reorganized IMC
Investment, which will refer to the Debtor post-confirmation as
owned by David F. Hoff, will execute and deliver a reorganization
note to Compass Bank. The principal amount of the Compass
Reorganization Note will be equal to the total amount owed to
Compass Bank on the Debtor's bankruptcy filing, plus all accrued
and unpaid postpetition interest, and all reasonable postpetition
attorneys' fees, costs of collection, and other amounts owed under
the loan documents and applicable law, without discount, through
the date of the Compass Reorganization Note.
Interest will accrue on the Compass Reorganization Note at the
fixed rate of 7.83% per annum. The principal balance of the
Compass Reorganization Note will be no more than $7,658,519 as of
Feb. 1, 2007, subject to final reconciliation by the Debtor. The
principal balance plus attorneys' fees accruing after Dec. 1,
2006, up to a total of $20,000 additional attorneys' fees.
Plains Capital Bank's claims will receive the following treatment:
i) Plains Capital's Third Lien Secured Claim has been paid in
full prior to confirmation of the Plan and the lien has been
extinguished. Accordingly, such lien will not survive
confirmation of the Plan.
ii) As of Nov. 16, 2006, Plains Capital's Fourth Lien Secured
Claim is allowed in the amount of at least $2,084,154, plus
additional amounts. The allowed amount of Plains' Fourth
Lien Secured Claim will be adjusted to take into account
any payments received by Plains prior to the effective date
of the Plan, as well as additional accrued but unpaid
interest through the effective date of the Plan, and all
unpaid amounts owed.
iii) On or before the effective date of the Plan, the Reorganized
Debtor will execute and deliver to Plains a reorganization
note in the principal amount equal to the allowed amount of
Plains' Fourth Lien Secured Claim. The outstanding
Principal balance of the Plains Reorganization Note will
bear interest at the fixed rate of 7.5% per annum.
iv) The Plains Reorganization Note will be secured by valid,
properly perfected liens in the Reorganized Debtor's assets
to the same extent and priority as the Plains Fourth Lien
Secured Claim had prior to the confirmation of the Plan.
This lien will survive date of confirmation of the Plan.
The Class 2F Claim of Crocker & Reynolds Construction LP will
receive an allowed secured claim which is secured by a valid
perfected lien on the Debtor's Las Colinas multi-purpose office
building all rents on that property in the order of priority as
such lien existed on the Debtor's bankruptcy filing. Crocker &
Reynolds' Secured Claim will accrue interest from the confirmation
date of the Plan at the rate of 7% and will be paid in 23 monthly
installments of $1,500 per month with the remaining balance on the
allowed Secured Claim due and payable on the twenty-fourth month
after confirmation of the Plan.
Holders of Class 3 Allowed General Unsecured Claims will receive
pro rata share of $50,000, which will be paid from the cash
contributed by Mr. Hoff or an entity under his control to be
contributed to the Debtor under the Plan in an amount not less
than $1,575,000 plus the extinguishment of the Plains Third Lien
Secured Claim. If causes of actions result in the collection of
cash, the Class 3 Claims will share the proceeds pro rata subject
only to the costs of litigation.
Class 4 Insider Claims will receive nothing under the Plan while
each then-issued and outstanding equity interest in any of the
Debtor will be deemed cancelled and extinguished.
Full-text copy of IMC Investment's Amended Disclosure Statement is
available for a fee at:
http://www.researcharchives.com/bin/download?id=070110011247
Based in Dallas, Texas, IMC Investment Properties Inc. filed for
chapter 11 protection on July 3, 2006 (Bankr. N.D. Tex. Case
No. 06-32754). Edwin Paul Keiffer, Esq., at Hance Scarborough
Wright Ginsberg and Brusilow, LLP, and Keith Miles Aurzada, Esq.,
at Powell Goldstein LLP, represent the Debtor in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in this case. When the Debtor filed for protection from
its creditors, it estimated assets and debts between $10 million
and $50 million.
INTERNAL INTELLIGENCE: Taps Weiser LLP as Financial Advisor
-----------------------------------------------------------
Internal Intelligence Service Inc. asks the U.S. Bankruptcy Court
for the District of New Jersey for authority to employ Weiser LLP
as accountant and financial advisor, nunc pro tunc to Dec. 28,
2006.
Weiser LLP's services will include:
a) the preparation of complied, reviewed or audited financial
statement reports;
b) the preparation of federal, state and local income tax,
sales tax, payroll tax and other tax returns;
c) the review of all financial information prepared by the
Debtor, including a review of the Debtor's financial
statements as of the filing of the petition date, showing
in detail all assets and liabilities as well as priority
and secured creditors;
d) monitoring of the Debtor's activities regarding cash
expenditures, receivable collections, asset sales and
projected cash requirements;
e) attendance at meetings including the Debtor, creditors,
their attorneys and consultants, if required;
f) the review of the Debtor's periodic operating and cash
flow statements;
g) the review of the Debtor's books and records for
intercompany transactions, related party transactions,
potential preferences, fraudulent conveyances and other
potential prepetition investigations;
h) conducting investigations with respect to the prepetition
acts, conduct, property, liabilities and financial
condition of the Debtor, its management and creditors
including the operation of its business and as
appropriate, avoidance actions;
i) the review and analysis of proposed transactions for
which the Debtor seeks Court approval;
j) assisting in a sale process of the Debtor collectively or
in segments, if any;
k) assisting the Debtor in developing, evaluating,
structuring and negotiating the terms and conditions of
all potential plans of reorganization including
the preparation of a liquidation analysis;
l) the analysis of claims filed;
m) providing expert testimony on the results of its findings;
n) assisting the Debtor in developing alternative plans,
including contacting plan sponsors, if appropriate; and
o) providing the Debtor with other and further accounting and
financial advisory services, including valuation,
accounting system and process consulting and general
restructuring and advice with respect to financial
business and economic issues as may arise during the
course of the Debtor's case;
The standard hourly rates for Weiser LLP's professionals are:
Designation Hourly Rate
----------- -----------
Partners/Directors $312 to $400
Senior Managers $264 to $312
Managers $204 to $264
Seniors $168 to $204
Assistants $108 to $132
Paraprofessionals $72 to $132
James Horgan, Esq., a partner at Weiser LLP, assures the Court
that his firm does not hold or represent any interest adverse to
the Debtor or its estate.
Newark, New Jersey-based Internal Intelligence Service Inc.
provides security and investigative services. The Debtor filed
for Chapter 11 protection on Dec. 20, 2006 (Bankr. D. N.J.
Case No.:06-22824) Jonathan I. Rabinowitz, Esq., at Booker,
Rabinowitz, Trenk, Lubetkin, Tully, DiPasquale & Webster, P.C.,
represents the Debtor. No Committee of Unsecured Creditors has
been appointed in the Debtor's case. When the Debtor filed for
bankruptcy, it estimated its assets and debts at $1 million to
$100 million.
ISTAR FINANCIAL: Gets Required Consents to Amend Note Indentures
----------------------------------------------------------------
iStar Financial Inc. has received the requisite consents to adopt
the proposed amendments to the indentures governing certain series
of its outstanding senior Notes.
Securities Amount Outstanding % Consenting
---------- ------------------ ------------
7.000% Notes due 2008 $185,000,000 95.82 %
4.875% Notes due 2009 $350,000,000 94.57 %
6.000% Notes due 2010 $350,000,000 93.57 %
5.125% Notes due 2011 $250,000,000 94.46 %
6.500% Notes due 2013 $150,000,000 99.41 %
5.700% Notes due 2014 $367,022,000 96.87 %
Adoption of the proposed amendments required the consent of
holders of at least a majority of the aggregate principal amount
of the outstanding Notes of each series under the indentures. The
proposed amendments will conform most of the covenants to the
Company's investment grade bond covenants.
iStar and U.S. Bank Trust National Association, the trustee under
the indentures, executed the supplemental indentures adopting the
proposed amendments on Jan. 9, 2007. In addition, the consent
solicitation expired at 5:00 p.m. of the same date. The
amendments will not become operative until iStar Financial accepts
and pays for all consents received.
Citigroup Corporate and Investment Banking acted as the
solicitation agent for the Consent Solicitation. Global
Bondholder Services Corporation acted as the information and
tabulation agent.
iStar Financial (NYSE: SFI) -- http://www.istarfinancial.com/--
is a publicly traded finance company focused on the commercial
real estate industry. The company provides custom-tailored
financing to high-end private and corporate owners of real estate
nationwide, including senior and junior mortgage debt, senior and
mezzanine corporate capital, and corporate net lease financing.
* * *
iStar Financial Inc.'s preferred stock carry Moody's Investors
Service's Ba1 rating with a stable outlook.
Fitch Ratings raised the company's preferred stock rating to
'BB+' from 'BB' in January 2006. Fitch said the Rating Outlook is
Stable.
JEAN COUTU: Earns $72.5 Million in 2007 Fiscal Second Quarter
-------------------------------------------------------------
The Jean Coutu Group Inc. reported its financial results for the
second quarter and first half of fiscal 2007 ended Nov. 25, 2006.
For the second quarter of fiscal 2007, net earnings were
$72.5 million compared with $30.8 million for the second quarter
of the previous fiscal year.
Canadian and U.S. network sales performance continues to improve,
driven by strong pharmacy sales. U.S. network front-end sales
showed improvement in all categories, but continue to be impacted
by the decline in the photo category.
"The Jean Coutu Group's second quarter results were positively
impacted by stronger sales performance in both the Canadian and
U.S. networks," president and chief executive officer Jean Coutu
said.
"We are seeing the results of our focus on sales growth and
efficient operations in both networks. In addition, we recognized
various components of the Rite Aid-Jean Coutu Group transaction
during the quarter. We now expect the Rite Aid-Jean Coutu Group
transaction to close shortly after the end of the third quarter,
which ends on March 3, 2007."
On Aug. 23, 2006, the company entered into a definitive agreement
with Rite Aid Corporation whereby the company would dispose of its
network in the United States. The company expects to close this
transaction, subject to certain usual conditions, shortly after
the end of the third quarter, which ends on March 3, 2007.
However, Generally Accepted Accounting Principles require that the
company recognizes certain components of this transaction earlier.
The after-tax impairment loss recognized during the first quarter
of fiscal 2007 amounted to $120 million.
During the second quarter of fiscal 2007, the company reversed a
$12 million portion of the original loss due principally to an
increase in the value of Rite Aid shares to be received as
consideration. The year-to-date after tax impairment loss amounts
to $108 million.
As a result of the disposal transaction announced on Aug. 24,
2006, the company no longer amortizes the assets related to its
U.S. operations since they are classified as assets held for sale.
There were no U.S. operations amortization charges recorded during
the second quarter of fiscal 2007 compared with $54.2 million for
the first quarter of fiscal 2007.
Earnings before specific items were $60.8 million compared with
$29.0 million for the second quarter of the previous fiscal year.
The first half net loss was $36.3 million compared with net
earnings of $41.9 million for the corresponding period last year.
First half earnings before specific items were $78.6 million
compared with $41.3 million for the corresponding period last year
due to the fact that there were no US operations amortization
charges recorded during the second quarter of fiscal 2007.
Revenues
Total revenues of the company's Canadian operations for the second
quarter reached $478.4 million compared with $413.4 million for
the second quarter of fiscal 2006, an increase of $65 million or
15.7%. Second quarter Canadian revenues increased by 10.4% year-
over-year, excluding the impact of currency exchange rate
fluctuations. The 26-week revenue figure reached $913.9 million,
an increase of $135.8 million or 17.5% year-over-year (or 9.8% in
local currency).
The company's U.S. operations generated total revenues of
$2.355 billion, up 2.6% from the second quarter of fiscal 2006,
due principally to improving pharmacy and front-end sales.
Pharmacy sales were impacted by the conversion of branded drugs to
generics, which generally have a lower selling price, but higher
gross margins for the drugstore retailer. The 26-week revenue
figure increased to $4.706 billion for the period ended Nov. 25,
2006, up $91.4 million or 2% from last year.
Total revenues for the second quarter of fiscal 2007 increased by
$124.1 million or 4.6% to $2.833 billion, from $2.709 billion for
the same quarter during fiscal 2006. Year-to-date revenues
increased by $227.2 million or 4.2% to $5.620 billion for the
26-week period ended Nov. 25, 2006, compared with $5.392 billion
for the corresponding period in fiscal 2006.
Retail sales
Retail sales growth percentages quoted herein are calculated in
local currency in order to exclude the impact of currency rate
fluctuations. As of Aug. 1, 2005, the company began to report
same-store sales for the Eckerd drugstores acquired on July 31,
2004, and publishes this information for both the Canadian and US
networks on a monthly basis.
For the second quarter of fiscal 2007, both of the company's
networks showed an increase in sales.
During the second quarter, the company's Canadian franchise
network were up 6.9%, pharmacy sales gained 8.3% and front-end
sales increased 5.4% year-over-year in terms of comparable stores.
The network showed a 7.5% increase in retail sales compared with
the same period of fiscal 2006. Retail sales for the quarter were
$673.7 million.
The U.S. corporate pharmacy network retail sales increased 2.7%,
pharmacy sales increased 2.9% and front-end sales increased 1.9%
compared with the same quarter of fiscal 2006 in terms of
comparable stores. The impact of generic drugs replacing branded
drugs on U.S. pharmacy sales growth was 356 basis points for the
period. Front-end sales growth was negatively impacted by the
decline in the photo category. The network posted a 2.8% increase
in retail sales when compared with the same quarter of fiscal
2006. Retail sales for the quarter were $2.352 billion.
OIBA
OIBA decreased for the second quarter of fiscal 2007 to $121.3
million from $125.1 million for the corresponding period of fiscal
2006. OIBA decreased by $3.8 million compared to the
corresponding period of fiscal 2006 and, as a percentage of
revenues, ended the quarter at 4.3% compared with 4.6% for the
same period of 2006.
Fiscal 2007 second quarter OIBA was impacted by certain
restructuring charges principally related to the transition pay
program associated with the announced transaction. OIBA before
restructuring charges amounted to $131 million during the second
quarter of fiscal 2007 and ended the second quarter at 4.6%, the
same level as the second quarter of fiscal 2006.
OIBA as a percentage of revenues ended the 26-week period at 3.9%
compared with 4.3% for the same period in fiscal 2006. OIBA
before restructuring charges as a percentage of revenues ended the
first half at 4.3%, the same level as the first half of fiscal
2006.
Outlook
With the announcement of the Rite Aid-Jean Coutu Group
transaction, the company will be well positioned to capitalize on
the growth in the North American drugstore retailing industry.
Demographic trends in Canada and the United States are expected to
contribute to growth in the consumption of prescription drugs, and
to the increased use of pharmaceuticals as the primary
intervention in individual healthcare. Management believes that
these trends will continue and that the company will achieve sales
growth through differentiation and quality of offering and service
levels in its drugstore networks.
The company operates its Canadian and US networks with a focus on
sales growth, its real estate program and operating efficiency.
Management expects that the announced transaction with Rite Aid,
which is expected to close shortly after the end of the third
quarter, which ends on March 3, 2007, will help create shareholder
value.
The Jean Coutu Group will optimize its US presence by transforming
its investment in a regional drugstore chain into the leading
ownership position of a major national chain with enhanced scale
to better compete in the US drugstore industry. The company's 32%
equity interest in the expanded Rite Aid will allow shareholders
to participate in the economic benefits of expected synergies.
The cash proceeds from the transaction will be used to retire
debt, enhancing financial flexibility.
Dividend
The Board of Directors of The Jean Coutu Group declared a
quarterly dividend of $CDN0.03 per share. This dividend is
payable on Feb. 8, 2007, to all holders of Class A subordinate
voting shares and holders of Class B shares listed in the
company's shareholder ledger as of Jan. 25, 2007.
About Jean Coutu
Headquartered in Longueuil, Quebec, The Jean Coutu Group Inc.
(TSX: PJC.A) -- http://www.jeancoutu.com/-- has a combined
network of 2,175 corporate and franchised drugstores (under the
banners of Brooks and Eckerd Pharmacy, PJC Jean Coutu, PJC
Clinique and PJC Sante Beaute) in North America. The Group's
United States operations employ 46,000 people and comprise 1,853
corporate owned stores located in 18 states of the Northeastern,
mid-Atlantic and Southeastern United States. The Group's Canadian
operations and franchised drugstores in its network employ over
14,000 people and comprise 322 PJC Jean Coutu franchised stores in
Quebec, New Brunswick and Ontario.
* * *
As reported in the Troubled Company Reporter on Oct. 30, 2006,
in connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology for the US & Canadian Retail sector, the rating agency
downgraded its B3 Corporate Family Rating for The Jean Coutu
Group Inc.
KINDER MORGAN: S&P Cuts Rating on $10 Million Certificates to BB-
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
$10 million Corporate Backed Trust Certificates Kinder Morgan
Debenture-Backed Series 2002-6 Trust to 'BB-' from 'BBB', and
removed it from CreditWatch, where it was placed with negative
implications June 1, 2006.
The lowered rating reflects the Jan. 5, 2007 downgrade of the
underlying securities, consisting of $11 million 7.45% senior
debentures issued by Kinder Morgan Inc. due March 1, 2098, and the
removal of the rating from CreditWatch negative.
Corporate Backed Trust Certificates Kinder Morgan Debenture-Backed
Series 2002-6 Trust is a swap-independent synthetic transaction
that is weak-linked to the underlying collateral, which consists
of $11 million 7.45% Kinder Morgan Inc. senior debentures.
L&T DEVELOPMENT: Case Summary & 2 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: L&T Development, LLC
41 W. Kings Highway
Haddonfield, NJ 08033
Bankruptcy Case No.: 07-10161
Debtor affiliate filing separate chapter 11 petitions:
Entity Case No.
------ --------
M&T Marine Group, L.L.C. 07-10163
Chapter 11 Petition Date: January 4, 2007
Court: District of New Jersey (Camden)
Debtors' Counsel: Albert A. Ciardi, III, Esq.
Ciardi & Ciardi, P.C.
One Commerce Square
2005 Market Street, Suite 2020
Philadelphia, PA 19103
Tel: (215) 557-3550
Fax: (215) 557-3551
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
L&T Development LLC's 2 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Sea Coast National Bank $9,046,710
P.O. Box 9012
815 Colorado Avenue
Stuart, FL 34994
Thomas R. Tomei Trust $3,047,337
c/o WM E Howe & Co. CPA's
Suite 340 MS 44
2 International Plaza
Philadelphia, PA 19113
LIGAND PHARMA: Amends Purchase Pact with King Pharmaceuticals
-------------------------------------------------------------
Ligand Pharmaceuticals Incorporated executed an amendment to its
purchase agreement with King Pharmaceuticals Inc. and King
Pharmaceuticals' wholly owned subsidiary, King Pharmaceuticals
Research and Development, Inc.
The company also executed a letter agreement with King relative to
the amendment to the purchase agreement. The Side Letter provides
that the company will repay the Loan, with interest then due on
Jan. 8, 2007, and, if the Closing occurs before Feb. 29, 2007, the
interest will be refunded to Ligand at the Closing. The interest
refund would be in addition to any credits due under the Purchase
Agreement at Closing, including Ligand's $37.75 million
termination payment to Organon Pharmaceuticals USA in October
2006, for which the Loan proceeds were used.
Under the Amendment, the parties agreed that King could make
offers, contingent on the closing, to the Ligand sales
representatives, plus its regional business managers starting on
Nov. 30,2006. The Parties agreed on certain related termination,
bonus and severance terms to those sales representatives and
regional business managers that did not receive offers from King.
The parties further amended the Purchase Agreement to move the
Closing from Dec. 31, 2006 to Feb. 28, 2007.
The company and king entered the Purchase Agreement on
Sept. 6, 2006, pursuant to which King has agreed to acquire all of
the company's rights in and to Avinza(R) (morphine sulfate
extended-release capsules) in the U.S., its territories and
Canada, including all Avinza inventory, equipment, records and
related intellectual property, and assume certain liabilities as
set forth in the Purchase Agreement.
In addition, King agreed to offer employment following the closing
of the Transaction to certain of the company's existing sales
representatives that support the sale of Avinza or otherwise
reimburse the company for certain agreed upon severance
arrangements offered to any non-hired representatives. Each party
had the right to terminate the Purchase Agreement if the Closing
had not occurred by Dec. 31, 2006.
In connection with the Transaction, King committed to loan the
company $37.75 million, which was drawn on Oct. 12, 2006, and is
subject to certain market terms, including a 9.5% interest rate
and a security interest in the assets that comprise Avinza and
certain of the proceeds of the company's sale of certain other
assets.
Under the original terms of the Loan, if the Closing occurred by
Jan. 8, 2007, accrued interest on the Loan would be forgiven and
the outstanding principal amount due would be credited against the
Closing Payment. If the Loan were drawn by the company and the
Closing did not occur by Jan. 8, accrued interest and the
outstanding principal amount due would become due on Jan. 1, 2007.
The company also entered, on Sept. 6, 2006, into a contract sales
force agreement, pursuant to which King has agreed to conduct a
detailing program to promote the sale of Avinza for an agreed fee.
As part of the Amendment, the parties agreed that termination of
the Sales Agreement would be subject to 60 days advance notice,
instead of the original 30 days.
A full text-copy of Amendment Number 1 to Purchase Agreement may
be viewed at no charge at http://ResearchArchives.com/t/s?1831
A full text-copy of the Side Letter to the Purchase Agreement may
be viewed at no charge at http://ResearchArchives.com/t/s?1832
Ligand Pharmaceuticals Incorporated (NASDAQ:LGND)
-- http://www.ligand.com/-- discovers, develops and markets new
drugs that address critical unmet medical needs of patients in the
areas of cancer, pain, skin diseases, men's and women's hormone-
related diseases, osteoporosis, metabolic disorders, and
cardiovascular and inflammatory diseases. Ligand's proprietary
drug discovery and development programs are based on gene
transcription technology, primarily related to intracellular
receptors.
* * *
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Ligand Pharmaceuticals Incorporated's balance sheet at
Sept. 30, 2006, showed $231,867,000 in total assets and
$470,712,000 in total liabilities, resulting in a $251,190,000
stockholders' deficit. At June 30, 2006, the company had a
stockholders' deficit of $238.5 million.
LORRAINE MOWAD: Case Summary & Nine Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Lorraine Ann Mowad
3585 Lost Creek Boulevard
Austin, TX 78735
Bankruptcy Case No.: 06-12119
Type of Business: The Debtor filed for chapter 11
protection on December 5, 2005
(Bankr. W.D. Tex. Case No.05-20078).
Chapter 11 Petition Date: December 30, 2006
Court: Western District of Texas (Austin)
Judge: Frank R. Monroe
Debtor's Counsel: Stephen W. Sather, Esq.
Barron & Newburger, P.C.
1212 Guadalupe, Suite 104
Austin, TX 78701
Tel: (512) 476-9103 Ext. 220
Fax: (512) 476-9253
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's Nine Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Kocher, AnnMarie and Joel Judgment $340,000
28610 Founders Place
Spicewood, TX 78669
Bruce Wilpon $0
IRS General Counsel's Office
301 East 6th, Room 601
Austin, TX 78701
Walter Thurmond $0
Barrett, Burke, Wilson, Castle
Daffin & Frappier
1900 St. James Place, Suite 500
Houston, TX 77056
Smit, Steven Graves, Dougherty $0
Hearon & Moody
Tom W. Sharp $0
Koons, Glenn & Jeannie Loan $0
Gray Jolink Legal Fees $0
Internal Revenue Service Taxes $0
City of Austin Utility Service $0
MALDEN MILLS: Case Summary & 30 Largest Unsecured Creditors
-----------------------------------------------------------
Lead Debtor: Malden Mills Industries, Inc.
46 Stafford Street
Lawrence, MA 01842
Bankruptcy Case No.:
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
ADS Properties LLC 07-10049
AES Properties LLC 07-10050
Malden Mills Distributors 07-10051
Malden Mills GmbH Holding, Inc. 07-10052
Type of Business: Malden Mills develops, manufactures, and
markets Polartec(R) performance fabrics.
Polartec(R) products range from lightweight
wicking base layers to insulation to extreme
weather protection and are utilized by the best
clothing brands in the world. In addition,
Polartec(R) fabrics are used extensively by all
branches of the United States military
including the Army, Navy, Marine Corps, Air
Force, and Special Operations Forces. The
company also has operations in Germany,
Spain, France and the U.K. See
http://www.polartec.com/
Chapter 11 Petition Date: January 10, 2007
Court: District of Delaware (Delaware)
Judge: Kevin Gross
Debtors' Counsel: Laura Davis Jones, Esq.
Michael Seidl, Esq.
Pachulski, Stang, Ziehl Young,
Jones & Weintraub, PC
919 North Market Street 17th Floor
Wilmington, DE 19899-8705
Tel: (302) 652-4100
Fax: (302) 652-4400
Estimated Assets Estimated Debts
---------------- ---------------
Malden Mills Industries, $1 Million to More than
Inc. $100 Million $100 Million
ADS Properties LLC $1 Million to More than
$100 Million $100 Million
AES Properties LLC $1 Million to More than
$100 Million $100 Million
Malden Mills Distributors $10,000 to More than
$100,000 $100 Million
Malden Mills GmbH Holding, Less than $10,000 More than
Inc. $100 Million
Debtors' Consolidated List of 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Rechtsanwalt Harald Bubhardt Note $5,562,000
Ebersbach Gewerbering 8
02828 Gorlitz, Germany
Tel: 13581-38-52-0
Fax: 49-(0) 351-88527-40
Aaron Feuerstein Contract Claim $1,560,516
300 Kent Street
Brookline, MA
Fax: (617) 574-4112
City of Methuen Utility $1,492,933
41 Pleasant Street
Methuen, MA 01844-0397
Attn: Office of Tax Collector
Fax: (978) 794-3240
Caterpillar Inc. Deficiency $1,161,928
c/o Holland & Knight LLP
10 St. James Avenue
Boston, MA 02116
Attn: Tara Myslinski
Fax: (617) 523-6850
Unifi Textured Polyster LLC Trade $304,254
P.O. Box 404617
Atlanta, GA 30384-4617
Attn: Terry Gore
Tel: (336) 316-5634
Fax: (336) 316-5607
Outside Magazine Services $168,588
National Grid Utility $97,336
Rodale Services $67,914
Solar Turbines Inc. Trade $64,602
Avery Dennison Ris Trade $58,669
Grant Thornton LLP Professional Fees $52,833
BASF Corporation Trade $51,510
Consoltex Inc. Utility $44,897
The Crosby Group Services $44,530
AV Sportswear Inc. Trade $43,839
Advanced Computer Equipment Lease $42,746
Services Inc.
Sapona Manufacturing Trade $40,511
Company Inc.
Nail Communications Inc. Services $39,416
Lowe Alpine Services $39,270
Exeltor Corp. Utility $28,592
Boehme Filatex Inc. Trade $28,455
Sierra Magazine Services $27,482
Alliance Airport Advertising Services $26,989
Foster-Miller Inc. Trade $24,920
UPS Supply Solutions Freight $22,996
MDP Realty Associates LLC Trade $22,365
Adco 131448 Canada Inc. Services $21,750
Blue Fox Ned Graphics Inc. Trade $21,727
Groz-Beckert USA Inc. Utility $21,108
Backbone Media Services $20,815
MALDEN MILLS: Sells Assets to Gordon Brothers Under Chapter 11
--------------------------------------------------------------
Malden Mills Industries, Inc. disclosed Wednesday that its board
of directors has unanimously voted to approve the sale of the
company to Gordon Brothers Group of Boston, Massachusetts, for
$44 million. Malden Mills will continue normal manufacturing
operations at both its facilities in Lawrence, Massachusetts, and
Hudson, New Hampshire.
In order to implement the sale, Malden Mills Industries filed
voluntary petitions for reorganization under Chapter 11 of the
U.S. Bankruptcy Code with the U.S. Bankruptcy Court for the
District of Delaware.
The Chapter 11 process will provide an efficient environment for
completion of the sale. The sale is subject to higher and better
offers, and completion of the sale is expected by the end of
February 2007, subject to court approval.
GE Commercial Finance will be providing a debtor-in-possession
financing facility, which ensures that the company has the working
capital required for a seamless transition in operations to new
ownership.
Malden Mills CEO Michael Spillane said, "Over the past three years
we have worked diligently to improve every aspect of the
operational side of the business. Our on-time delivery,
manufacturing quality, and product innovation have never been
better. The sale of Malden Mills to Gordon Brothers Group
transitions the company into a state of permanent ownership and
financial stability. This financial transaction will
significantly improve the Company's balance sheet enabling Malden
Mills to continue to serve our customers in both the commercial
and military markets."
Malden Mills Industries, Inc. -- http://www.polartec.com/--
develops, manufactures, and markets Polartec(R) performance
fabrics. Polartec(R) products range from lightweight wicking base
layers to insulation to extreme weather protection and are
utilized by the best clothing brands in the world. In addition,
Polartec(R) fabrics are used extensively by all branches of the
United States military including the Army, Navy, Marine Corps, Air
Force, and Special Operations Forces. The company has operations
in Germany, Spain, France and the U.K.
MCKESSON CORP: Directors Vote to Declassify Board
-------------------------------------------------
McKesson Corporation's board of directors has voted to declassify
the Board so that all directors are elected annually. The
declassification is subject to approval by its stockholders at the
2007 Annual Meeting scheduled for July 25, 2007.
Currently, the company's Board is divided into three classes.
Each year, one class is elected to serve a term of three years.
If the change is approved, all directors will stand for election
for one-year terms beginning with the 2008 annual stockholders
meeting.
The Board also amended the company's by-laws to implement a
majority vote standard in uncontested director elections in place
of the plurality vote standard, which will continue to apply for
contested elections. Consequently, in uncontested elections, a
director nominee will be elected only if the number of votes cast
"for" the nominee exceeds the number of votes cast "against" the
nominee. If an incumbent director does not receive the necessary
vote for re-election, the Board, acting on the recommendation of
the Committee on Directors and Corporate Governance, must
determine whether or not to accept the director's required
resignation no later than 90 days following the certification of
the stockholder vote.
The Board also amended the company's Stockholder Rights Plan,
commonly known as a "poison pill" and as a result the rights plan
will automatically expire at close of business on Jan. 31, 2007.
"These actions demonstrate our Board's continuing commitment to
strong, stockholder-focused, contemporary corporate governance
practices which we believe are consistent with our goal of
creating long-term, sustainable value for McKesson stockholders,"
John H. Hammergren, chairman and chief executive officer, said.
Headquartered in San Francisco, California, McKesson Corp.
(NYSE: MCK) -- http://www.mckesson.com/-- is a Fortune 15
healthcare services and information technology company dedicated
to helping its customers deliver high-quality healthcare by
reducing costs, streamlining processes and improving the quality
and safety of patient care. Over the course of its 172-year
history, McKesson has grown by providing pharmaceutical and
medical-surgical supply management across the spectrum of care;
healthcare information technology for hospitals, physicians,
homecare and payors; hospital and retail pharmacy automation; and
services for manufacturers and payors designed to improve outcomes
for patients.
* * *
Moody's Investors Service affirmed McKesson Corporation's Junior
subordinated notes at Ba1; Sr. subordinated shelf at (P) Ba1;
Subordinated shelf at (P) Ba1; Junior subordinated shelf at (P)
Ba1; and Preferred shelf at (P)Ba1.
MICHAEL WILSON: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Michael Allen Wilson, Sr.
863 County Road 106
Florence, AL 35633
Bankruptcy Case No.: 07-80048
Chapter 11 Petition Date: January 5, 2007
Court: Northern District of Alabama (Decatur)
Judge: Jack Caddell
Debtor's Counsel: Garland C. Hall, III, Esq.
Chenault, Hammond & Hall, P.C.
P.O. Box 1906
Decatur, AL 35602
Tel: (256) 353-7031
Fax: (256) 353-8701
Estimated Assets: Unknown
Estimated Debts: Unknown
The Debtor did not file a list of his 20 largest unsecured
creditors.
MICRON TECH: S&P Lifts Corporate Credit Rating to BB- from B+
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Micron Technology Inc. to 'BB-' from 'B+'.
The outlook is stable.
"The upgrade reflects the company's improving business diversity,
good operating performance, and sustained satisfactory
capitalization," said Standard & Poor's credit analyst Bruce
Hyman.
The ratings on Boise, Idaho-based Micron reflect the challenges of
supplying capital- and technologically-intensive products in an
environment of severe price pressures and aggressive competition,
tempered by the company's moderate financial policies and good
industry position. Micron has been
diversifying its business away from the commodity dynamic random
access memory industry, used in PCs. Micron also supplies
specialty DRAMs for servers, networking and wireless applications;
NAND flash memories for music players through a joint venture with
Intel Corp.; and is the leading supplier
of complementary metal-oxide semiconductors image sensors for
phones.
Micron is the fifth-largest DRAM supplier, holding about a 10%
share of the global market, after Samsung Electronics Co. Ltd.,
Qimonda AG, Hynix Semiconductor Inc., and Elpida Memory Inc.
Micron has substantially reduced its position in the highly
challenging commodity DRAM market. Commodity DRAM margins are now
well below the low-20% corporate average, while most other
products' gross margins are in the 40% area. About 20%-25% of
wafers entering production are for imaging, a similar amount are
specialty DRAM, 15%-20% NAND, and about 40% commodity PC DRAM; the
percentages vary seasonally. PC DRAMs had been 75% of wafer
starts in the November 2004 quarter.
IM Flash Technologies LLC, Micron's 51%-owned NAND joint venture
with Intel Corp., began operations in January 2006. The business
will supply a significant portion of Apple Computer Corp.'s iPod
memory needs in addition to merchant market sales. IM operates a
300 millimeter wafer fabrication plant in Virginia, and uses some
capacity in Micron's Idaho plant. Micron's NAND market share was
in the low single digits entering 2006. Total NAND output could
double by year-end as a Utah plant comes on line, and the company
plans to produce NAND chips in Singapore in 2008.
MILLS CORP: Shares Rise to Close at $15.47/Share Despite Warning
----------------------------------------------------------------
The Mills Corp.'s shares rose in yesterday's trading after
investors learned of the company's bankruptcy warning, the
Associated Press reports.
The company's stock closed at $15.47. It traded between $12.27
and $44.50 in a 52-week span.
Morgan Stanley analyst Matthew Ostrower told the AP that the
warning brings risk, but the probability of bankruptcy is slim.
The company issued the warning in a Securities and Exchange
Commission filing saying that it needs to sell sufficient assets
to pay-off its Senior Term Loan, to recapitalize, or sell the
company.
In a TCR report on Jan. 10, the Audit Committee of the company's
Board of Directors said it completed its investigation into
various issues related to the historical accounting policies and
practices of the company and The Mills Limited Partnership.
The company said that it is actively exploring strategic
alternatives. It said that completion of the Audit Committee
investigation and extension of its senior term loan with Goldman
Sachs Mortgage Company, as administrative agent, are important
components to complete the process.
Headquartered in Chevy Chase, Maryland, The Mills Corporation
(NYSE:MLS) -- http://www.themills.com/-- develops, owns,
manages retail destinations including regional shopping malls,
market dominant retail and entertainment centers, and
international retail and leisure destinations. The Company owns
42 properties in the U.S., Canada and Europe, totaling 51
million square feet. In addition, The Mills has various
projects in development, redevelopment or under construction
around the world.
* * *
As reported in the Troubled Company Reporter on March 24, 2006,
The Mills Corporation disclosed that the Securities and Exchange
Commission has commenced a formal investigation. The SEC
initiated an informal inquiry in January after the Company
reported the restatement of its prior period financials.
Mills is restating its financial results from 2000 through 2004
and its unaudited quarterly results for 2005 to correct accounting
errors related primarily to certain investments by a wholly owned
taxable REIT subsidiary, Mills Enterprises, Inc., and changes in
the accrual of the compensation expense related to its Long-Term
Incentive Plan.
MILLS CORP: Will Pay Bonuses to CEO and CFO Under Performance Plan
------------------------------------------------------------------
The Mills Corp.'s Executive Compensation Committee has determined
that the 2006 bonuses under its annual short-term performance
incentive plan for Mark S. Ordan, chief executive officer and
president and Richard J. Nadeau, executive vice president and
chief financial officer would be paid at the 2006 target award
level for each under the Plan.
In addition, the Committee has determined that the bonuses, which
amount to $382,250 for Mr. Ordan and $209,250 for Mr. Nadeau,
would be paid in two equal installments, with the first 50% to be
paid in 2006 and the second 50% to be paid during the first
quarter of 2007.
Headquartered in Chevy Chase, Maryland, The Mills Corporation
(NYSE:MLS) -- http://www.themills.com/-- develops, owns,
manages retail destinations including regional shopping malls,
market dominant retail and entertainment centers, and
international retail and leisure destinations. The company owns
42 properties in the U.S., Canada and Europe, totaling 51
million square feet. In addition, The Mills has various
projects in development, redevelopment or under construction
around the world.
* * *
As reported in the Troubled Company Reporter on Jan. 10, 2007,
The Mills Corp. issued a warning in a Securities and Exchange
Commission filing saying that it could file for bankruptcy
protection if it cannot sell all or part of the company amidst
accounting errors and speculations of possible executive
misconduct.
As reported in the Troubled Company Reporter on March 24, 2006,
The Mills Corporation disclosed that the Securities and Exchange
Commission has commenced a formal investigation. The SEC
initiated an informal inquiry in January after the Company
reported the restatement of its prior period financials.
Mills is restating its financial results from 2000 through 2004
and its unaudited quarterly results for 2005 to correct accounting
errors related primarily to certain investments by a wholly owned
taxable REIT subsidiary, Mills Enterprises, Inc., and changes in
the accrual of the compensation expense related to its Long-Term
Incentive Plan.
MILLS CORP: Inks Term Sheet With Mills LP & Kan Am on Co-Ventures
-----------------------------------------------------------------
The Mills Corp. and The Mills Limited Partnership entered on
Dec. 29, 2006, into a binding omnibus term sheet, dated Dec. 27,
2006, with Kan Am reflecting the parties' agreement on a number of
issues involving the projects in which they are co-venturers.
As expressed in the Term Sheet, with the exception of certain
items, the Term Sheet is a complete resolution of all material
financial disputes known to the parties with respect to each of
the Joint Venture Properties.
The material terms of the Term Sheet are:
-- Kan Am approved the refinancing of the St. Louis Mills
secured debt held by Goldman Sachs Mortgage Company on
substantially the terms set forth in an exhibit to the
Term Sheet and ratified the Nov. 30, 2006, refinancing of
the Discover Mills secured debt formerly held by GSMC.
-- The Company and Mills LP agreed to make a capital
contribution of no more than $60 million but no less than
$55 million to the St. Louis Mills partnership to pay down
the existing secured debt, which contribution, made in the
amount of approximately $56.4 million, will be treated as
subordinate capital and accrue a priority return,
subordinate to the payment of Kan Am's return on capital and
return of capital.
-- The preferred returns owed to Kan Am for St. Louis Mills and
Discover Mills (totaling approximately $10.5 million) will
be paid quarterly through Dec. 31, 2007, with the company
and Mills LP required to contribute capital to the St. Louis
Mills or Discover Mills partnerships, as appropriate, if
necessary to pay such amounts. The company and Mills LP
will receive capital account and unreturned capital
contribution account credit for any amounts so contributed
and will earn a priority return with respect to any such
amounts.
-- The parties agreed to limit the payment to the company or
Mills LP of amounts owed to them by St. Louis Mills and
Discover Mills to certain items set forth in the Term Sheet,
with all other amounts owed to the company or Mills LP,
which are not expected to be material, to be converted to
capital (with no preferred return to accrue or be paid to
the company or Mills LP on account of such capital).
-- The company and Mills LP agreed to make representations and
warranties to St. Louis Mills and Discover Mills with regard
to third party payables as of the closing date of the
relevant construction loan refinancing and to be directly
liable and indemnify St. Louis Mills and Discover Mills for
undisclosed payables for a period of one year from the
closing of their respective refinancings.
-- The company and Mills LP agreed to make additional capital
contributions totaling $20 million to the St. Louis Mills
and Discover Mills partnerships to reduce debt or fund
project improvements in the reasonable discretion of Kan Am.
The company and Mills LP will receive capital account and
unreturned capital contribution account credit for, and will
earn a priority return with respect to, these contributions.
The company and Mills LP were released from certain
development, leasing and other guarantees with respect to
St. Louis Mills, Discover Mills, and Pittsburgh Mills.
-- The company and Mills LP agreed to make an additional
capital contribution totaling $15 million to St. Louis Mills
to fund certain tenant improvements. The company and Mills
LP will receive capital account and unreturned capital
contribution account credit for and earn a priority return
with respect to these contributions.
-- In lieu of reconciling and repaying amounts that otherwise
might be due to Kan Am with respect to certain FoodBrand
lease modifications and charge-backs of corporate overhead
costs, the company and Mills LP agreed to make a payment of
$4 million to affiliates of Kan Am.
-- The company and Mills LP agreed to make additional capital
contributions totaling $564,000 to Grapevine Mills; no
preferred return will accrue or be paid on such capital
contribution and such capital contribution will not be
returned upon a major capital event.
-- The company and Mills LP agreed to make an additional
capital contribution of $1.5 million to Colorado Mills to
make the company's and Mills LP's capital account equal to
Kan Am's $25.5 million capital account. The company and
Mills LP will receive capital account and unreturned capital
contribution account credit for, and shall earn a priority
return with respect to, the additional capital contribution.
-- The parties agreed that the Katy Mills partnership will use
the proceeds from a pending land sale first, to repay an
approximate $20 million inter-company loan made by the
company and Mills LP and next, to pay Kan Am one year of its
priority return, with any remaining funds to be treated in
accordance with the waterfall provisions in the partnership
agreement. In the event the net proceeds from the land sale
and available distributable cash are insufficient to repay
the loan made by the company and Kan Am's one year priority
return, the shortfall will be allocated equally to the
company and Kan Am and deducted from the amounts otherwise
described in the Term Sheet.
-- The parties revised the waterfall provisions of the Discover
Mills, St. Louis Mills, and Katy Mills partnerships to limit
the amount paid by those partnerships to the company or
Mills LP on account of their respective partner loans to no
more than 60% of adjusted cash flow and to require the
distribution to the partners of no less than 40% of adjusted
cash flow.
The company and Mills LP have a long-standing relationship with
Kan Am, a German syndicator of closed and open-end real estate
funds, and its affiliates. Since 1994, Kan Am has invested
approximately $1 billion in equity in various projects with Mills
LP.
Kan Am currently has two representatives on the company's Board of
Directors: James Braithwaite and Franz von Perfall.
A full-text copy of the term sheet is available for free at:
http://ResearchArchives.com/t/s?1845
Pittsburgh Mills
Its joint venture partners redeemed on Dec. 28, 2006, Mills LP's
ownership interest in Pittsburgh Mills for net total consideration
of approximately $8.5 million.
As a result of the redemption of Mills LP's ownership interest,
the company and Mills LP expect to take a charge in 2006 for an
impairment related to Pittsburgh Mills of approximately
$46 million.
The company and Mills LP did not make a material infusion of
capital before the sale. The net proceeds from the redemption
were used to pay the $4 million Settlement Payment, with the
balance used to pay down the Senior Term Loan with Goldman Sachs.
As a result of the redemption, the company's consolidated debt was
reduced by the amount of the Pittsburgh mortgage loan of
$123.7 million.
Headquartered in Chevy Chase, Maryland, The Mills Corporation
(NYSE:MLS) -- http://www.themills.com/-- develops, owns,
manages retail destinations including regional shopping malls,
market dominant retail and entertainment centers, and
international retail and leisure destinations. The Company owns
42 properties in the U.S., Canada and Europe, totaling 51
million square feet. In addition, The Mills has various
projects in development, redevelopment or under construction
around the world.
* * *
As reported in the Troubled Company Reporter on Jan. 10, 2007,
The Mills Corp. issued a warning in a Securities and Exchange
Commission filing saying that it could file for bankruptcy
protection if it cannot sell all or part of the company amidst
accounting errors and speculations of possible executive
misconduct.
As reported in the Troubled Company Reporter on March 24, 2006,
The Mills Corporation disclosed that the Securities and Exchange
Commission has commenced a formal investigation. The SEC
initiated an informal inquiry in January 2006 after the company
reported the restatement of its prior period financials.
Mills is restating its financial results from 2000 through 2004
and its unaudited quarterly results for 2005 to correct accounting
errors related primarily to certain investments by a wholly owned
taxable REIT subsidiary, Mills Enterprises Inc. and changes in the
accrual of the compensation expense related to its Long-Term
Incentive Plan.
MOOG INC: S&P Lifts Corporate Credit Rating to BB+ from BB
----------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Moog
Inc., including raising the corporate credit rating to 'BB+' from
'BB'. The outlook is stable.
"The upgrade reflects an improving financial profile despite
higher debt levels to fund acquisitions, and solid demand in key
end markets," said Standard & Poor's credit analyst Christopher
DeNicolo.
Revenues in fiscal 2006 increased 24% as a result of strength in
all segments, as well as acquisitions. Improved operating
margins in the industrial and component segments have offset lower
aircraft earnings, resulting in a modest increase in segment
margins. Consolidated operating margins increased to 16.6% from
16% in 2005. Most credit measures improved in
2006 and are generally better than average for the rating with
EBITDA interest coverage of 8x, funds from operations to debt
around 40%, and debt to EBITDA of 2.5x. Further improvement is
likely in 2007 due to solid demand in key markets, better
operating efficiencies, and some debt reduction. Further
debt-financed acquisitions are possible and could result in a
temporary deterioration in credit protection measures. However,
financial ratios would likely remain appropriate for the rating
even with a mid-sized acquisition with satisfactory profitability
and appropriate valuation.
The ratings on Moog reflect participation in the cyclical and
competitive commercial aerospace and industrial markets, the
likelihood of debt-financed acquisitions, and the associated
integration risk. Ratings benefit somewhat from leading positions
in niche markets and generally above-average-for-the-rating
financial measures. East Aurora, New York-based Moog
is a leading provider of highly engineered motion control systems
for critical applications, including aircraft flight controls and
industrial processes.
Overall, credit protection measures are expected to be appropriate
for current ratings, including the impact of possible additional
mid-sized debt-financed acquisitions. The outlook could be
revised to negative if leverage increases significantly to fund an
acquisition and is not restored to previous levels in a reasonable
period.
NEFF CORP: Good Performance Prompts S&P's Stable Outlook
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on Miami-
based equipment rental company Neff Corp., including its 'B+'
corporate credit rating.
In addition, Standard & Poor's removed all ratings from
CreditWatch where they were placed with positive implications on
May 31, 2006.
The outlook is stable.
"The action reflects the decreased likelihood that Neff will
complete an IPO that it filed in May 2006 in the near term," said
Standard & Poor's credit analyst John R. Sico.
The CreditWatch had reflected that proceeds from an IPO used for
debt repayment, concurrent with the improved operating
performance, would enhance the company's credit profile and
possibly lead to a modest upgrade.
Neff is currently demonstrating improved operating performance, as
should be expected during the cyclical upswing in the industry.
Absent the IPO, upside to the ratings is limited as the company
does not generate sufficient free cash flow to materially reduce
high debt levels as a consequence of the
2005 recapitalization.
Additionally, if the company pursued a more aggressive financial
policy, specifically acquisitions or dividends, it would risk a
downgrade or outlook revision to negative.
NEXIA HOLDINGS: Posts $1.2 Mil. Net Loss in Quarter Ended Sept. 30
------------------------------------------------------------------
Nexia Holdings Inc. recorded net losses of $1,294,898 and $198,918
for the three and nine-month periods ended Sept. 30, 2006, as
compared with net losses of $242,941 and $3,802 for the comparable
periods in 2005.
The increase in the three-month net losses of $1,051,957, or 433%,
compared to the same period in 2005 is attributable primarily to
the expense of prepaid consulting costs in the sum of $1,077,857
recognized during the quarter ended Sept. 30, 2006, and other
investor relations expenses paid by the company during the current
quarter.
Gross revenues for the three and nine month periods ended
Sept. 30, 2006, were $434,575 and $1,111,127 as compared with
$46,880 and $254,702 for the same periods in 2005. The increases
in the three and nine month revenues of $387,695 and $856,425, or
827% and 336% respectively, are due to inclusion of sales revenue
from the operation of the Landis Salon and Black Chandelier retail
sales in the sums of $383,072 and $971,059 for the three and nine-
month periods ended Sept. 30, 2006, respectively.
The company's balance sheet at Sept. 30, 2006, showed $4,983,157
in total assets, $3,828,234 in total liabilities, minority
interest of $94,116 and stockholders' equity of $1,060,807.
A full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?184f
Going Concern Doubt
De Joya Griffith & Company LLC raised substantial doubt about the
company's ability to continue as a going concern after auditing
the company's financial statements for the year ended Dec. 31,
2005. The auditor pointed to the company's cumulative operating
losses and negative working capital.
About Nexia Holdings
Based in Salt Lake City, Utah, Nexia Holdings Inc. (OTCBB: NEXH)
-- http://www.nexiaholdings.com/-- engages in the acquisition,
lease, management, and sale of real estate properties in the
continental United States, through its subsidiaries. It operates,
owns, or has interests in a portfolio of commercial, industrial,
and residential properties. The company's commercial properties
comprise Wallace-Bennett Building, and a one-story retail building
in Salt Lake City, Utah; and an office building in Kearns, Utah.
Its residential property comprises a condominium unit located in
close proximity to Brian Head Ski Resort and the surrounding
resort town in southern Utah. The company's industrial property
includes Parkersburg Terminal in Parkersburg, West Virginia. It
also owns parcels of undeveloped land in Utah and Kansas.
NICHOLAS-APPLEGATE: Moody's Junks Rating on $10 Mil. Class D Notes
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings on these classes
of notes issued by Nicholas-Applegate CBO I Limited:
* $12,830,000 Class C Participating Notes, Due 2012
-- Prior Rating: Baa3, on watch for possible downgrade
-- Current Rating: Ba3
* $10,690,000 Class D Floating Rate Notes, Due 2012
-- Prior Rating: B1, on watch for possible downgrade
-- Current Rating: Caa3
Moody's has also confirmed the ratings on these classes of notes
issued by Nicholas-Applegate CBO I Limited:
* $23,700,000 Class B-1 Floating Rate Notes, Due 2012
-- Prior Rating: A3, on watch for possible downgrade
-- Current Rating: A3
* $2,500,000 Class B-2 Fixed Rate Notes, Due 2012
-- Prior Rating: A3, on watch for possible downgrade
-- Current Rating: A3
Moody's noted that the rating action was primarily due to
deterioration in the transaction's credit quality as measured by
the weighted average rating factor and decline in the weighted
average coupon , as well as the higher than covenanted
concentration of securities rated Caa1 or below by Moody's.
Furthermore, the transaction's underhedged position poses interest
rate risk that could possibly have a negative impact on the
transaction's performance in the future.
NRG ENERGY: Repays $400 Million of Term Loan B Facility
-------------------------------------------------------
NRG Energy Inc. repaid $400 million of its term loan B facility
and completed the debt reduction portion of its capital allocation
program. The company used cash on hand to fund the repayment.
As reported in the Troubled Company Reporter on Aug. 4, 2006, the
company disclosed a $750 million share repurchase program, which
will be implemented in two phases.
Phase One was a $500 million common share repurchase program to be
completed over the course of 2006. In addition, the sale of the
Australian business is expected to provide approximately
$400 million in net cash proceeds that NRG intends to use to pay
down its Term B loan in the first quarter of 2007. Consolidated
project level debt associated with Australia is $177 million,
bringing total expected debt reduction to $577 million.
Phase Two of the share repurchase plan, which will be initiated
after the expected step up in the company's restricted payment
capacity at the end of the first quarter 2007, is an additional
$250 million common share buyback.
Based in Princeton, New Jersey, NRG Energy Inc. (NYSE: NRG) --
http://www.nrgenergy.com/-- presently owns and operates a diverse
portfolio of power-generating facilities, primarily in Texas and
the Northeast, South Central and Western regions of the United
States. Its operations include baseload, intermediate, peaking,
and cogeneration facilities, thermal energy production and energy
resource recovery facilities. NRG also has ownership interests in
generating facilities in Australia and Germany.
* * *
As reported in the Troubled Company Reporter on Nov. 7, 2006,
Fitch affirmed NRG Energy's Senior secured term loan B at
'BB'/'RR1'; Senior secured revolving credit facility at
'BB'/'RR1'; Senior notes to 'B+'/'RR3'; Convertible preferred
stock at 'CCC+'/'RR6'; Issuer default rating (IDR) at 'B' ratings
of following the company's announced hedge reset and capital
allocation program. The Rating Outlook is Stable.
OWENS CORNING: Files Amended Registration Statement with the SEC
----------------------------------------------------------------
Reorganized Owens Corning filed an amended registration statement
with the Securities and Exchange Commission indicating the number
of shares certain shareholders may sell from time to time.
Pursuant to the Prospectus, shareholders may offer and sell, from
time to time, an aggregate of up to 83,751,633 shares of
Reorganized Owens Corning common stock.
David T. Brown, chief executive officer of Reorganized Owens
Corning, says that shares of the company's common stock may be
sold at fixed prices, prevailing market prices at the times of
sale, prices related to the prevailing market prices, varying
prices determined at the times of sale, or negotiated prices.
Mr. Brown notes that Reorganized Owens Corning will not receive
any of the proceeds from the sale of the shares of the common
stock sold by the selling stockholders.
Reorganized Owens Corning's common stock is listed for trading on
the New York Stock Exchange under the symbol "OC." The number of
stockholders of record of Owens Corning's common stock as of
December 6 was 100.
A full-text copy of the Amended Registration Statement may be
viewed at no charge at http://ResearchArchives.com/t/s?1842
Headquartered in Toledo, Ohio, Owens Corning (OTC: OWENQ.OB)
-- http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts. The company filed for chapter
11 protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 147; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
As reported in the Troubled Company Reporter on Oct. 9, 2006, the
Honorable John P. Fullam, Sr., of the U.S. District Court for the
Eastern District of Pennsylvania affirmed on Sept. 28, 2006, the
order of the Honorable Judith Fitzgerald of the U.S. Bankruptcy
Court for the District of Delaware, confirming Owens Corning's
Sixth Amended Plan of Reorganization. The Plan took effect on
Oct. 31, 2006, marking the company's emergence from Chapter 11.
OWENS CORNING: Wants Insurance Companies' Claims Disallowed
-----------------------------------------------------------
Reorganized Owens Corning and its affiliates assert that American
Home Assurance Company, et al.'s request, for their administrative
claims to be allowed, should be denied.
Anna P. Engh, Esq., at Covington & Burling in Washington, D.C.,
relates that the U.S. Bankruptcy Court for the District of
Delaware's order confirming Owens Corning's Chapter 11 Plan makes
clear that "no request for payment of an administrative claim need
be filed with respect to an administrative claim that is paid or
payable by a Debtor in the ordinary course of business."
Ms. Engh notes that the Insurers' request fails to identify any
insurance premiums, deductibles, retentions, or other costs that
are outstanding or owed.
Ms. Engh contends that the Insurers' request is seeking an
extension to provide information with respect to identifying
amounts allegedly due under insurance policies in which the
Debtors' obligations were entitled to administrative priority.
The Reorganized Debtors do not believe that any amounts are due
and owing under the policies.
The Insurers' request that unspecified payments be deemed as
allowable administrative expenses is not properly supported,
Ms. Engh says.
Moreover, a request to classify the status of any payments paid or
payable in the ordinary course of business is unnecessary,
Ms. Engh states.
As reported in the Troubled Company Reporter on Nov 24, 2006,
several insurance companies that provided coverage or other
services to Owens Corning and its debtor-affiliates ask the
Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for the
District of Delaware to allow their administrative expense claims:
(1) American Home Assurance Company;
(2) American Home Assurance Company-Canada;
(3) American International Specialty Lines Insurance
Company;
(4) AIU Insurance Company;
(5) AIU North America, Inc.;
(6) Commerce and Industry Insurance Company;
(7) Illinois National Insurance Company;
(8) Lexington Insurance Union Fire Insurance Company of
Pittsburgh, PA;
(9) New Hampshire Insurance Company;
(10) Starr Excess Liability Insurance International Limited-
United Kingdom; and
(11) certain other affiliates of American International
Group, Inc.
Headquartered in Toledo, Ohio, Owens Corning (OTC: OWENQ.OB)
-- http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts. The company filed for chapter
11 protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 147; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
As reported in the Troubled Company Reporter on Oct. 9, 2006, the
Honorable John P. Fullam, Sr., of the U.S. District Court for the
Eastern District of Pennsylvania affirmed on Sept. 28, 2006, the
order of the Honorable Judith Fitzgerald of the U.S. Bankruptcy
Court for the District of Delaware, confirming Owens Corning's
Sixth Amended Plan of Reorganization. The Plan took effect on
Oct. 31, 2006, marking the company's emergence from Chapter 11.
PENTON MEDIA: Will Amend 11-7/8% Senior Secured Notes Offering
--------------------------------------------------------------
Penton Media Inc. has received the requisite consents to amend (i)
the indenture governing the 2007 Notes and (ii) the indenture
governing the 2011 Notes, in connection with its cash tender
offers and consent solicitations for (i) any and all of its
outstanding 11-7/8% Senior Secured Notes due 2007 and (ii) any and
all of its outstanding 10-3/8% Senior Subordinated Notes due 2011,
The company and U.S. Bank National Association, the trustee under
the indenture governing the 2007 Notes, intend to enter into a
supplemental indenture, which will amend the indenture under which
the 2007 Notes were issued. The supplemental indenture will not
become operative unless and until the 2007 Notes that have been
validly tendered on or prior to the Expiration Date
are accepted for payment and paid for by the Company. The
supplemental indenture will, if it becomes operative, amend the
indenture governing the 2007 Notes to, among other things,
eliminate substantially all of the restrictive covenants, certain
events of default and other related provisions and release the
security interest benefiting the holders of 2007 Notes.
If the 2007 Notes are accepted for payment by the company, the
consideration to be paid for each 2007 Note validly tendered and
not validly withdrawn prior to 5:00 p.m., New York City time, on
Jan. 8, 2007, is $1,002.50 per $1,000 principal amount of 2007
Notes, which includes a consent payment of $10.00 per $1,000
principal amount of 2007 Notes.
The consideration to be paid for each Note validly tendered and
not validly withdrawn after the Consent Date but prior to 9:00
a.m., New York City time, on Jan. 31, 2007, unless extended by the
Company in its sole discretion is $992.5 per $1,000 principal
amount of 2007 Notes, which will exclude any consent payment. At
5:00 p.m. on the Consent Date, $122,454,000 aggregate principal
amount of 2007 Notes had been validly tendered and not withdrawn,
representing approximately 77.75% of the aggregate principal
amount of the 2007 Notes then outstanding.
The company and The Bank of New York Trust Company, N.A., the
trustee under the indenture governing the 2011 Notes, intend
to enter into a supplemental indenture, which will amend the
indenture under which the 2011 Notes were issued. The
supplemental indenture will not become operative unless and
until the 2011 Notes that have been validly tendered on or prior
to the Expiration Date are accepted for payment and paid for by
the Company. The supplemental indenture will, if it becomes
operative, amend the indenture governing the 2011 Notes to, among
other things, eliminate substantially all of the restrictive
covenants, certain events of default and other related provisions.
If the 2011 Notes are accepted for payment by the company, the
consideration to be paid for each 2011 Note validly tendered and
not validly withdrawn on the Consent Date is $1,054.38 per $1,000
principal amount of 2011 Notes, which includes a consent payment
of $10.00 per $1,000 principal amount of 2011 Notes. The
consideration to be paid for each Note validly tendered and not
validly withdrawn after the Consent Date but prior to the
Expiration Date is $1,044.38 per $1,000 principal amount of
011 Notes, which will exclude any consent payment. At 5:00 p.m.
on the Consent Date, $155,050,000 aggregate principal amount
of 2011 Notes had been validly tendered and not withdrawn,
representing approximately 99.84% of the aggregate principal
amount of the 2011 Notes then outstanding.
Headquartered in Cleveland, Ohio, Penton Media Inc. (OTCBB:PTON)
provides media products that deliver propriety business
information to owners, operators, managers and professionals in
the industries it serves.
* * *
As reported in the Troubled Company Reporter on Nov. 7, 2006,
Standard & Poor's Ratings Services placed all of its ratings on
Prism Business Media Inc., including the 'B' corporate credit
rating, on CreditWatch with negative implications. At the
same time, Standard & Poor's placed all its ratings on Penton
Media Inc., including the 'CCC+' corporate credit rating, on
CreditWatch with developing implications, indicating upward
or downward movement of the rating in the near future.
PILGRIM'S PRIDE: Gets Tenders for 92% of Gold Kist Common Stock
---------------------------------------------------------------
Pilgrim's Pride Corporation completed the subsequent offering
period of its tender offer to acquire all of the outstanding
shares of Gold Kist Inc. common stock for $21 per share in cash.
The company disclosed that as of 5:00 p.m. New York City Time on
Jan. 5, 2007, a total of 47,149,479 shares, representing
approximately 92% of Gold Kist outstanding common stock, have been
tendered into Pilgrim's Pride's initial tender offer and during
the subsequent offering period.
All Gold Kist shares validly tendered during the subsequent
offering period have been accepted for payment. Pilgrim's Pride
accepted shares tendered during the initial offer period on
Dec. 27, 2006.
Pilgrim's Pride intends to complete the acquisition of the
remaining shares of Gold Kist through a merger of the acquisition
vehicle, Protein Acquisition Corporation, into Gold Kist, in which
all Gold Kist shares not tendered into Pilgrim's Pride's initial
tender offer and subsequent offering period (other than shares
held in the treasury of Gold Kist or held by Pilgrim's Pride or
any of its subsidiaries) will be converted into the right to
receive $21 per share.
Following the merger, Gold Kist will be a wholly owned subsidiary
of Pilgrim's Pride. Under applicable law, the merger is not
subject to the approval of the remaining Gold Kist stockholders.
Pilgrim's Pride further disclosed that, it has also completed its
tender offer to purchase and related consent solicitation for Gold
Kist's outstanding 10-1/4% Senior Notes due March 15, 2014. The
company received tenders and related consents with respect to 100%
of the aggregate principal amount of the outstanding Gold Kist
Notes, all of which were accepted for payment.
As reported in the Troubled Company Reporter on Dec. 5, 2006,
Pilgrim's Pride Corporation and Gold Kist Inc. entered into a
definitive merger agreement. The transaction was unanimously
approved by the boards of directors of both Pilgrim's Pride and
Gold Kist and has a total equity value of approximately
$1.1 billion, plus the assumption of approximately $144 million of
Gold Kist's debt.
Baker & McKenzie LLP and Morris, Nichols, Arsht & Tunnell, LLP are
acting as legal counsel and Credit Suisse, Legacy Partners Group
LLC and Lehman Brothers Inc. are acting as financial advisors to
Pilgrim's Pride. Innisfree M&A Incorporated is acting as
information agent for Pilgrim's Pride's offer.
About Gold Kist
Based in Atlanta, Georgia, Gold Kist Incorporated (NASDAQ: GKIS)
-- http://www.goldkist.com/-- operates a fully integrated chicken
production, processing and marketing business. Gold Kist's
production operations include nine divisions located in Alabama,
Florida, Georgia, North Carolina and South Carolina.
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corp.
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the United
States, Mexico and in Puerto Rico. Pilgrim's Pride employs
approximately 40,000 people and has major operations in Texas,
Alabama, Arkansas, Georgia, Kentucky, Louisiana, North Carolina,
Pennsylvania, Tennessee, Virginia, West Virginia, Mexico and
Puerto Rico, with other facilities in Arizona, Florida, Iowa,
Mississippi and Utah.
* * *
Moody's Investors Service's held its Ba2 Corporate Family Rating
for Pilgrim's Pride Corp. In addition, Moody's revised or held
its probability-of-default ratings and assigned loss-given-default
ratings on the company's note issues, including an LGD6 rating on
its $100 million 9.25% Sr. Sub. Global Notes Due Nov. 15, 2013,
suggesting noteholders will experience a 95% loss in the event of
a default.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Standard & Poor's Ratings Services reported that its 'BB'
corporate credit rating and other ratings on the second-largest
U.S. poultry processor, Pilgrim's Pride Corp., remain on
CreditWatch with negative implications, where they were originally
placed Aug. 21, 2006.
PIMA COUNTY: S&P Lowers Rating on Revenue Bonds to BB from BB+
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Pima
County Industrial Development Authority, Arizona's series 2003A
and 2006 education revenue bonds, supported by Paragon Management
Inc., to 'BB' from 'BB+'.
The outlook is negative.
The downgrade is based on the school's poor management of its
funds, which has led to a decline in cash and unrestricted net
assets and the violation of the bond covenant related to a minimum
fund balance.
The negative outlook reflects uncertainty and challenges related
to the implementation of the proposed action plan and the return
to a stable financial condition.
Fiscal 2006 results indicate an operating deficit of roughly
$475,000--mainly due to a lack of expenditure controls.
Unrestricted net assets at the end of fiscal 2006 totaled a paltry
$7,292, which is significantly below the estimated $700,000
required by the bond covenants. Lax expenditure controls, coupled
with a concentration of budgetary power,
resulted in excessive nonbudgeted expenditures, including the
hiring of nonbudgeted personnel and expenditures related to a
possible school expansion.
The trustee, however, has agreed to waive its right to accelerate
loan payments. As a result, there have been noteworthy changes
made to the bylaws of the school--specifically related to
financial reporting and expenditure approvals.
In addition, the CEO, who was also chairman of the board of
directors, has resigned his position. An action plan has been
drafted by school management and adopted by the board. The plan
is projected to have a positive budgetary impact of roughly
$275,000 for fiscal 2007, with future savings of roughly $865,000
annually.
Should financial difficulties continue and reserve levels not
rebound to an adequate and required level, the rating could be
lowered further. In addition, while the possible expansion of the
school to include a high school has apparently been put on hold,
the current rating reflects the uncertainty regarding the
potential expansion's size and the school's ability to increase
enrollment to a level that would produce adequate debt service
coverage related to the issuance of additional bonds--particularly
if the new expansion is situated at a separate location from its
current site. The addition of a substantial amount of debt in a
relatively short period would pose challenges
related to facility and growth management.
For fiscal 2007, management is projecting a surplus of roughly
$260,000. To assist with cash flow needs during the fiscal year,
however, a short-term loan has been obtained in the amount of
$600,000, payable within 18 months.
PINNACLE ENT: Awards $1.5 Million in Bonuses to Four Executives
---------------------------------------------------------------
Pinnacle Entertainment Inc.'s compensation committee has approved
the 2006 cash bonuses and deferred bonuses, totaling $1,595,000,
for certain executive officers of the company not including Daniel
R. Lee, chairman and chief executive officer, whose bonus will be
determined by the Compensation Committee at a later time, based on
achievement of previously established objective performance goals.
The 2006 deferred bonuses were awarded under the Deferred Bonus
Plan. The deferred bonuses are deferred and paid in three equal
annual installments beginning January 2008. All cash bonuses were
paid on Jan. 4, 2007, except for amounts that any executive
officer may have elected to defer under the company's benefit
plans.
Wade W. Hundley, president, was awarded $360,000 in cash bonus and
a deferred bonus of $120,000. Stephen H. Capp, executive vice
president and chief financial officer was awarded a cash bonus of
$337,500 and a deferred bonus of $112,500. Alain Uboldi, chief
operating officer, was awarded a cash bonus of $255,000 and a
deferred bonus of $85,000. John A. Godfrey, executive vice
president, secretary and general counsel was awarded a cash bonus
of $243,750 and a deferred bonus of $81,250.
Headquartered in Las Vegas, Nevada, Pinnacle Entertainment Inc.
(NYSE: PNK) -- http://www.pnkinc.com/-- owns and operates casinos
in Nevada, Louisiana, Indiana and Argentina, owns a hotel in
Missouri, receives lease income from two card club casinos in the
Los Angeles metropolitan area, has been licensed to operate a
small casino in the Bahamas, and owns a casino site and has
significant insurance claims related to a hurricane-damaged casino
previously operated in Biloxi, Mississippi. Pinnacle opened a
major casino resort in Lake Charles, Louisiana in May 2005 and a
new replacement casino in Neuquen, Argentina in July 2005.
* * *
As reported in the Troubled Company Reporter on Oct. 4, 2006,
Moody's Investors Service's confirmed Pinnacle Entertainment
Inc.'s B2 Corporate Family Rating.
At the same time, Standard & Poor's Ratings Services affirmed its
'BB-' rating and '1' recovery rating following Pinnacle
Entertainment Inc.'s $250 million senior secured bank facility
add-on.
PRESERVE AT WOODLAND: Michigan Property Auction is January 29
-------------------------------------------------------------
Preserve at Woodland Harbor LLC and Woodland Harbor Holdings LLC
will sell an existing marina and clubhouse in South Haven,
Michigan, at an auction at 12:00 p.m. on Jan. 29, 2007.
The auction will be held at the offices of Grubb, & Ellis, 500
West Monroe Street, 29th Floor, in Chicago, Ill.
The Michigan property, known as the Project, will be sold free and
clear of all liens, claims, encumbrances, and interest.
The Debtors anticipate that an adjacent land to the Project will
be developed for single-family homes and town houses.
All written bids for the Project must be submitted on or before
12:00 p.m. on Jan. 26, 2007, and served to:
Thomas E. Springer, Esq.
Springer, Brown, Covey, Gaertner & Davis, LLC
400 South County Farm Road, Suite 330
Wheaton, IL 80187
Tel: (630) 510-0000
-- and --
Dirk Riekse, Esq.
Grubb & Ellis
100 North Riverside Plaza, 21st Floor
Chicago, IL 60606
Tel: (312) 224-3102
The Honorable Carol A. Doyle of the U.S. Bankruptcy Court for the
Northern District of Illinois, Eastern Division, will convene a
hearing at 1:30 p.m. on Feb. 1, 2007, for the approval of the
sale.
Preserve at Woodland Harbor LLC and Woodland Harbor Holdings LLC
are real estate developers. Four petitioners filed involuntary
petition against the Debtors on Oct. 2, 2006 (Bankr. N.D. Ill.
Case Nos. 06-12478 & 06-12479). Timothy W. Brink, Esq., at Lord
Bissell & Brook LLP represents the petitioners. Thomas E.
Springer, Esq., at Springer, Brown, Covey, Gaertner & Davis, LLC,
and Dirk Riekse, Esq., at Grubb & Ellis represents the Debtors.
RACHEL GREGG: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Rachel M. Gregg
dba Preferred Services, LLC
dba Preferred Cleaners
dba Preferred Cleaners of Riverview
dba Preferred Cleaners of E. Brainerd
fdba Collegedale Cleaners
5905 Crestview Drive
Hixson, TN 37343
Bankruptcy Case No.: 07-10054
Chapter 11 Petition Date: January 5, 2007
Court: Eastern District of Tennessee (Chattanooga)
Judge: R. Thomas Stinnett
Debtor's Counsel: David J. Fulton, Esq.
Wooden, Fulton & Scarborough, P.C.
737 Market Street, Suite 620
Chattanooga, TN 37402
Tel: (423) 756-9972
Fax: (423) 756-9943
Estimated Assets: Less than $10,000
Estimated Debts: $1 Million to $100 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Chris & Alice Shaia $50,000
184 Wood Dale Circle
Cedar Hills, TX 35104
Capital Bank $34,000
P.O. Box 2146
Fort Oglethorpe, GA 30742
Southern Adventist University $33,233
P.O. Box 370
Collegedale, TN 37315
Buston Family Partnership, L.P. $25,000
James R. Hughes $15,000
Jenkins Road Partners, LLC $14,661
Innovative Bank $14,400
Metalprogetti USA $12,355
Chattanooga Gas $10,601
The Hartford $4,769
Complete Bookkeeping Services $3,853
Water Works Plumbing $3,570
First Franklin Loan Services $3,234
Talk Radio 102.3 $2,950
Greenearth Cleaning $2,750
Diversified Companies, LLC $2,179
Edyth & John Buxton $2,021
Memorial Hospital $1,516
Phenix Supply Company $1,454
Bellsouth $1,406
RADNOR HOLDINGS: Court Extends Removal Period to February 19
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
until Feb. 19, 2007, the period during which Radnor Holdings Corp.
and its debtor-affiliates can file notices of removal with respect
to prepetition actions pursuant to Bankruptcy Rules 9006 and 9027.
The Debtors inform the Court that they were parties to several
different judicial and administrative proceedings pending in
various courts and administrative agencies.
The actions, the Debtors say, include a variety of claims,
specifically, discrimination, workers' compensation and product
liability claims.
In addition, the Debtors devoted their time on preparing a going
concern sale of their businesses and maintaining the value of
their businesses. Thus, they were unable to complete their review
of the actions. The extension will allow the Debtors to determine
any actions to be removed.
Headquartered in Radnor, Pennsylvania, Radnor Holdings Corporation
-- http://www.radnorholdings.com/-- manufactures and distributes
a broad line of disposable food service products in the United
States, and specialty chemicals worldwide. The Debtor and its
affiliates filed for chapter 11 protection on Aug. 21, 2006
(Bankr. D. Del. Case No. 06-10894). Gregg M. Galardi, Esq., and
Mark L. Desgrosseilliers, Esq., at Skadden, Arps, Slate, Meagher,
represent the Debtors. Donald J. Detweiler, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP, serves the
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they listed total assets of
$361,454,000 and total debts of $325,300,000.
RADNOR HOLDINGS: Has Until March 19 to Decide on Leases
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
extended until March 19, 2007, the period within which Radnor
Holdings Corporation and its debtor-affiliates must move to
assume, assume and assign, or reject unexpired leases of non-
residential real property.
The Debtors tell the Court that they have been unable to make a
thorough examination of their unexpired leases because they had
focused their attention to the sale of substantially all of their
assets to TR Acquisition Co., LLC. The sale to TR Acquisition
closed in November 2006. The Debtors also need more time to
analyze their remaining leases in conjunction with their
development of a liquidating plan.
The Debtors say that the requested extension will be subject to
each lessor's right to request, upon appropriate notice and
motion, for the Court to shorten the extension period for their
respective leases.
Headquartered in Radnor, Pennsylvania, Radnor Holdings Corporation
-- http://www.radnorholdings.com/-- manufactures and distributes
a broad line of disposable food service products in the United
States, and specialty chemicals worldwide. The Debtor and its
affiliates filed for chapter 11 protection on Aug. 21, 2006
(Bankr. D. Del. Case No. 06-10894). Gregg M. Galardi, Esq., and
Mark L. Desgrosseilliers, Esq., at Skadden, Arps, Slate, Meagher,
represent the Debtors. Donald J. Detweiler, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP, serves the
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they listed total assets of
$361,454,000 and total debts of $325,300,000.
REDPRAIRIE CORP: S&P Holds Corporate Credit Rating at B
-------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Waukesha, Wisconsin-based RedPrairie Corp.
The outlook is stable.
Standard & Poor's also affirmed the existing ratings on the senior
secured first-lien and second-lien bank loans, including the $20
million term loan B added to the facility, to provide for the
acquisition of StorePerform Technologies.
The ratings on RedPrairie reflect its narrow product focus within
a highly competitive and consolidating marketplace, moderately
acquisitive growth strategy, and high debt leverage. These are
only partly offset by a largely recurring revenue base, supported
by a broad customer base and relatively stable operating margins.
RedPrairie is a global provider of supply chain execution software
and services for warehouse, labor and transportation management
activities, coordinating interaction between manufacturers,
distributors, wholesalers and retailers. Pro forma for the
proposed bank facilities, RedPrairie will have
approximately $215 million of operating lease-adjusted total debt.
The market for supply chain execution software is highly
fragmented, with no clear market leader. In addition to competing
with other supply chain specialist vendors such as Manhattan
Associates, RedPrairie also competes with tier-one players such as
Oracle and SAP, each of whom possesses greater scale and broader
product breadth, in addition to being much better capitalized. A
relatively broad and diverse customer base, along with retention
rates in the high-90% area, support revenue visibility over the
intermediate term; however, a continued focus on improving product
functionality and servicing
capabilities will be a key to RedPrairie maintaining, or
improving, its competitive position over the longer term.
"The acquisition of StorePerform Technologies bolsters
RedPrairie's presence on the front end of the supply chain
process, namely within the retail store, providing functionality
around such activities as workforce management," said
Standard & Poor's credit analyst Stephanie Crane Mergenthaler.
"RedPrairie has been acquisitive over the past few years,
growing revenues from about $70 million in 2003 to a pro forma
revenue base expected to exceed $200 million in 2006. However,
RedPrairie's acquisitions have been less frequent than some of its
peers, and integration success is more apparent."
While the rating incorporates our expectation for continued
moderate acquisition activity in this rapidly consolidating
market, Standard & Poor's expects acquisitions to be modestly
sized over the next several quarters.
Despite a very narrow product focus and exposure to a highly
competitive and consolidating marketplace, a broad and diverse
customer base, along with relatively stable operating margins
provide ratings stability. A revision of the outlook to negative
could follow increased acquisition activity or any shareholder
initiatives, while a revision of the outlook to positive would
likely be a function of substantial, and sustained, improvement to
the company's debt leverage profile, likely the result of
successful integration of BlueCube and continued progress in
growing the customer base.
RELIABILITY INC: Posts $396,000 Net Loss in 2006 Third Quarter
--------------------------------------------------------------
Reliability Inc. reported a $396,000 net loss on $8,000 of
revenues for the quarter ended Sept. 30, 2006, compared with a
$717,000 net loss on $187,000 of revenues for the same period in
2005.
The decline in revenues was due to no system upgrades during the
third quarter of 2006. Revenues came from spare parts sales and
field service support activities.
Gross margin decreased $22,000 during the quarter ended Sept. 30,
2006, as a result of lower volume, changes in product mix, a
$53,000 reduction in payroll and payroll related expenses, an
$85,000 decrease in reserve accruals for excess and obsolete
inventory, and a $37,000 reduction in general operating expenses
offset by the reduction in revenues.
The decrease in net loss is mainly due to the $305,000 decrease in
marketing, general and administrative expenses, the $80,000
research and development expenses in the 2005 third quarter,
versus nil in 2006, partly offset by the decrease in gross profit
margins, and the $113,000 increase in loss from discontinued
operations of the company's former automotive, power sources, and
services divisions.
Marketing, general and administrative expense reductions were
primarily the result of a $232,000 decrease in labor cost due to
staff reductions, a $41,000 decrease in general operating expenses
due to lower business activity and reductions in staffing, and a
$35,000 reduction in depreciation due mainly to the
reclassification of the company's headquarters to assets held for
sale and no longer subject to depreciation.
As part of cost cutting measures implemented in August of 2005,
the company suspended all research and development activities.
At Sept. 30, 2006, the company's balance sheet showed $2.8 million
in total assets, $479,000 in total liabilities and $2.3 million in
total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?184b
Going Concern Doubt
As reported in the Troubled Company Reporter on July 12, 2006,
Fitts, Roberts & Co. P.C., expressed substantial doubt about
Reliability Inc.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
Dec. 31, 2005. The auditing firm pointed to the company's
recurring losses and negative cash flows from operating
activities.
About Reliability Inc.
Reliability Incorporated is principally engaged in the design,
manufacture, market and support of high performance equipment used
to test and condition integrated circuits. The company has been
providing capital equipment to integrated circuit manufacturers
and users to burn-in integrated circuits since 1975 and to
functionally test ICs during burn-in since 1980.
RESOURCE AMERICA: Earns $19.9 Million for the Year Ended Sept. 30
-----------------------------------------------------------------
Resource America Inc. reported income from continuing operations
of $3.9 million and $17.3 million for the fourth quarter and
fiscal year ended Sept. 30, 2006, respectively, as compared with
$793,000 and $5.4 million for the fourth quarter and fiscal year
ended Sept. 30, 2005, respectively, an increase of $3.1 million
and $11.9 million, respectively.
Net income was $4.1 million and $19.9 million for the fourth
quarter and fiscal year ended Sept. 30, 2006, respectively, as
compared to a net loss of $1.2 million and net income of
$16.5 million, for the fourth quarter and fiscal year ended Sept.
30, 2005, respectively.
Discontinued operations for fiscal 2005 include nine months of
operations and spin-off costs related to Atlas America Inc., the
company's former 80% owned energy subsidiary, prior to its tax-
free distribution to shareholders on June 30, 2005. The fourth
quarter ended Sept. 30, 2005, included $144,000 of spin-off costs
while the fiscal year ended Sept. 30, 2005, reflected
$16.5 million of Atlas America income from discontinued
operations, net of tax, including $2.7 million of spin-off costs.
Assets under management increased to $12.1 billion at Sept. 30,
2006, from $7.1 billion at Sept. 30, 2005, an increase of $5
billion.
At Sept. 30, 2006, the company's balance sheet showed
$416.8 million in total assets, $223.7 million in total
liabilities, and $193.1 million in total stockholders' equity.
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?1843
Resource America Inc. (NASDAQ: REXI) --
http://www.resourceamerica.com/-- is a specialized asset
management company that uses industry specific expertise to
generate and administer investment opportunities for its own
account and for outside investors in the financial fund
management, real estate and commercial finance sectors.
* * *
Moody's Investors Service placed Resource America Inc.'s senior
unsecured rating at Caa1.
RITE AID: Glass Lewis et. al Approves Brooks & Eckerd Acquisition
-----------------------------------------------------------------
Rite Aid Corp. reported that Institutional Shareholder Services
and Glass Lewis & Co., both recommend that Rite Aid stockholders
vote "FOR" the issuance of 250 million shares of Rite Aid common
stock to The Jean Coutu Group Inc. as part of Rite Aid's purchase
of the Brooks and Eckerd drugstore chains. Stockholders will vote
on the proposal at the company's special meeting of stockholders
on Jan. 18, 2007.
Both firms also recommend that Rite Aid stockholders vote to amend
the company's restated certificate of incorporation to increase
the number of authorized shares of common stock from 1 billion
shares to 1.5 billion shares and to approve the company's 2006
Omnibus Equity Plan.
On Aug. 24, 2006, Rite Aid had entered into a definitive agreement
to acquire approximately 1,850 Brooks and Eckerd drugstores and
distribution centers from The Jean Coutu Group for 250 million
shares of Rite Aid common stock, $1.45 billion in cash and the
intended assumption of $850 million of The Jean Coutu Group's long
term debt. Closing of the transaction, which is expected shortly
after Rite Aid's fourth quarter is dependent upon Rite Aid
stockholder approval, review under the Hart-Scott Rodino Act and
other customary closing conditions.
Rite Aid and The Jean Coutu Group are currently responding to
a request for additional information from the Federal Trade
Commission for the Hart-Scott Rodino review.
Mary Sammons, Rite Aid president and CEO, commented: "We are
pleased that such leading proxy advisory firms as ISS and Glass
Lewis both recognize that the acquisition of the Brooks and Eckerd
chains is a unique opportunity for Rite Aid and its stockholders.
The transaction will significantly expand the size of our company
with good stores in attractive locations and give us the scale we
need to compete more effectively. With approximately 5,000
stores, we'll be better able to take advantage of the growth
opportunities in the retail drugstore sector as well as be better
able to withstand competitive challenges to our business."
Institutional Shareholder, which issued its report to clients
Jan. 5, 2007, said it supported the acquisition "based upon the
compelling strategic rationale, the significant synergy potential
and the market enthusiasm for the deal."
Institutional Shareholder also said in its report: "We note that
the Rite Aid share price has appreciated 18% since the deal's
announcement, outperforming both of its primary peers CVS and
Walgreen. One reasonable interpretation of this positive relative
performance-a rarity for a company making a large acquisition-is
that the market believes the proposed transaction will create
value." The firm added that "acquirers who experience short-term
market outperformance tend to create value over the long-term as
well."
Glass Lewis, which issued its report to clients Dec. 21, 2006,
said it believes the transaction is beneficial because it "will
bolster the company's growth, provides economies of scale and be
accretive to Rite Aid's earnings in the second year post-closing."
Glass Lewis also said: "We also note that the transaction will
allow the company to remain competitive during a period of
aggressive deal making in the pharmaceutical retail industry."
About Rite Aid
Headquartered in Camp Hill, Pennsylvania, Rite Aid Corporation
(NYSE, PCX: RAD) -- http://www.riteaid.com/-- runs a drugstore
chain with 2005 annual revenues of $17.3 billion and 3,320 stores
in 27 states and the District of Columbia.
* * *
As reported in the Troubled Company Reporter on Oct. 25, 2006,
Moody's Investors Service confirmed the ratings of Rite Aid
Corporation's $300 million 2nd-lien secured notes due 2011 and
$357 million 2nd-lien secured notes due 2011 at B2.
ROGER AGUINAGA: Case Summary & 11 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Roger Aguinaga
10821 Berry Avenue
Anaheim, CA 92804
Bankruptcy Case No.: 07-10057
Chapter 11 Petition Date: January 8, 2007
Court: Central District Of California (Santa Ana)
Judge: Theodor Albert
Debtor's Counsel: Richard L. Barnett, Esq.
Barnett & Rubin
Jeffrey Corporate Centre
5450 Trabuco Road
Irvine, CA 92620
Tel: (949) 261-9700
Fax: (949) 261-9799
Total Assets: $10,874,800
Total Debts: $5,174,725
Debtor's 11 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Elin Hulstrom Personal Loan to $200,000
7 Terracima Business
Irvine, CA 92620
Bank of America Business Credit $100,000
14222 Culver Drive Line
Costa Mesa, CA 92626
Griswald Industries, Inc. Lease of Land for $44,000
2803 Barranca Avenue Business
Irvine, CA 92618
State Board of Equalization Sales Tax $42,000
Mollis & Mollis, Esq. Legal Fees $41,000
Baker Canyon Recycling Purchase of $38,217
Inventory
SBC Yellow Pages Advertising $20,000
Pending Litigation
Statewide Labor Corp. Labor $13,000
Thunderbolt & Lightfoot Mechanical Repairs $10,000
Gama Trucking Trucking Costs $6,100
Steel Unlimited, Inc. Steel Materials $4,438
SANKATY HIGH: Fitch Holds Low-B Rating on $33.5 Million Notes
-------------------------------------------------------------
Fitch affirms all classes of notes issued by Sankaty High Yield
Partners III, L.P.
These affirmations are the result of Fitch's review process and
are based on trustee information as of Nov. 30, 2006.
These rating actions are effective immediately:
--$95,000,000 class A-1A first senior secured variable-funding
notes affirmed at 'AAA';
--$105,000,000 equivalent class A-1B first second senior
secured variable-funding multi-currency notes affirmed at
'AAA';
--$35,000,000 class A-1C first senior secured variable-funding
swingline notes affirmed at 'AAA';
--$220,000,000 class A-1 first senior secured floating-rate
notes affirmed at 'AAA';
-- $22,500,000 second senior loans affirmed at 'AA';
-- $14,000,000 class A-2 second senior secured floating-rate
notes affirmed at 'AA';
-- $29,500,000 class B third senior secured fixed-rate notes
affirmed at 'A';
-- $11,000,000 class B third senior secured floating-rate
notes affirmed at 'A';
-- $7,500,000 class C senior subordinated secured fixed-rate
notes affirmed at 'BBB';
-- $43,000,000 class C senior subordinated secured floating-
rate notes affirmed at 'BBB';
-- $3,500,000 class D subordinated secured fixed-rate notes
affirmed at 'BB';
-- $17,500,000 class D subordinated secured floating-rate
notes affirmed at 'BB'; and,
-- $12,500,000 class E junior subordinated secured floating-
rate notes affirmed at 'B'
Sankaty High Yield Partners III L.P. is structured as a market
value collateralized debt obligation, which invests the proceeds
of its note issuance in a diverse portfolio of bank loans, high
yield securities, and mezzanine and special situation investments.
Founded in 1998, Sankaty Advisors, LLC is the credit affiliate of
Bain Capital Inc.
The ratings are based upon the asset pool, the advance rates
applicable to those assets and the credit enhancement provided to
the various rated classes of debt through subordination and
unrated equity capital. The ratings assigned to all classes of
notes address the likelihood that the investors will receive
timely payment of interest and ultimate payment of principal.
SECURITY AVIATION: Hires Christianson & Spraker as Counsel
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Alaska gave Security
Aviation Inc. permission to employ Christianson & Spraker as its
bankruptcy counsel.
Christianson & Spraker will:
(a) prepare the necessary schedules of assets and liabilities
and related pleadings;
(b) attend creditors' meetings;
(c) resolve issues concerning the rights of secured, priority
and unsecured creditors;
(d) pursue causes of action where appropriate;
(e) prepare and obtain court approval of a disclosure statement
and plan of reorganization; and
(f) assist the Debtor on other matters relative to the
administration of this estate.
Cabot Christianson, Esq., a partner at Christianson & Spraker,
discloses that he will bill $285 per hour for his work. The
firm's other professionals bill:
Professional Hourly Rate
------------ -----------
Gary Spraker, Esq. $220
Paralegals $75
Mr. Christianson assures the Court that his firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Headquartered in Anchorage, Arkansas, Security Aviation, Inc. --
http://www.securityaviation.biz/-- provides air charter services.
The Debtor filed for chapter 11 protection on Dec. 21, 2006
(Bankr. D. Ala. Case No. 06-00559). Cabot C. Christianson, Esq.,
at Christianson & Spraker, represents the Debtor in its
restructuring efforts. No Committee of Unsecured Creditors has
been appointed in the Debtor's case. When the Debtor filed for
bankruptcy, it estimated assets between $10 million to $50 million
and debts between $1 million to $10 million.
SECURITY AVIATION: Meeting of Creditors Scheduled Today
-------------------------------------------------------
The U.S. Trustee for Region 18 will convene a meeting of Security
Aviation Inc.'s creditors at 10:00 a.m., today, Jan. 11, 2007, at
room 250 E, Old Federal Building, 605 West Fourth Avenue, in
Anchorage, Alaska.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Anchorage, Arkansas, Security Aviation, Inc. --
http://www.securityaviation.biz/-- provides air charter services.
The Company filed for chapter 11 protection on Dec. 21, 2006
(Bankr. D. Ala. Case No. 06-00559). Cabot C. Christianson, Esq.,
at Christianson & Spraker, represents the Debtor. When the Debtor
filed for protection from its creditors, it estimated assets
between $10 million to $50 million and debts between $1 million to
$10 million.
SEWER ENTERPRISES: Case Summary & Two Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Sewer Enterprises, Ltd.
P.O. Box 933
St. John, VI 00831
Bankruptcy Case No.: 06-30015
Chapter 11 Petition Date: December 20, 2006
Court: District Court of the Virgin Islands
Judge: Judith K. Fitzgerald
Debtor's Counsel: Samuel H. Hall, Esq.
Hall & Griffith
No. 91- B-1 Estate Solberg
P.O. Box 305587
St. Thomas, VI 00803-5587
Tel: (340) 715-2945
Fax: (340) 776-8416
Petitioning
Creditor: Joan C. Oat
Secured Creditor and Minority Shareholder
c/o A. J. Weiss & Associates
6934 Vessup Lane, VI 00802
Tel: (340) 777-3011
Petitioning
Creditor's
Counsel: A. Jeffrey Weiss, Esq.
A.J. Weiss & Associates
6934 Vessup Lane
St. Thomas, VI 00802
Tel: (340) 777-3011
Fax: (340) 777-3019
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's Two Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Joan C. Oat Loan $654,612
6934 Vessup Lane, VI 00802
Tel: (340) 777-3011
Hall & Griffith Contract for $125,726
c/o Samuel H. Hall, Jr. Legal Services
P.O. Box 305587
St. Thomas, VI 00803
SOLUTIA INC: Selling 482-Acre Property to Shintech for $7.1 Mil.
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Solutia Inc. and its debtor-affiliates to sell their
approximately 482 acres of undeveloped flat land in Alvin, Texas,
to Shintech Incorporated for $7,109,500.
The property is a part of the Debtors' approximately 3,000-acre
land called the Chocolate Bayou Property where the Debtors operate
a chemical manufacturing plant on only 300 of the 3,000 acres. Of
the remaining 2,700 acres, 370 acres are leased to a third party,
245 acres are covered by a reservoir and the remaining 2,085
acres are unoccupied and undeveloped flat land.
J.V. Industrial Companies, Ltd. asserted a secured Claim No. 319
predicated on a perfected statutory mechanic's and materialmen's
lien against Solutia. J.V. informally objected to the motion
arguing that the J.V. Claim would not be adequately protected
following the closing of the proposed sale.
Solutia and J.V. entered into a Court-approved stipulation to
resolve the objection and to allow the J.V. Claim as a secured
claim in the Debtors' Chapter 11 cases.
Fluor Corporation has also asserted Claim No. 4593 against
Solutia, secured by a valid perfected mechanic's and
materialmen's lien on the Chocolate Bayou property, including the
sale property. The Fluor Claim was subsequently transferred to
Longacre Master Fund, Ltd. on June 5, 2006.
The Court approved the stipulation entered into by Solutia and
Longacre and authorized Solutia to pay to Longacre all amounts
due on account of the Fluor Claim from the proceeds of the sale.
Longacre will retain the Fluor Lien on the remainder of the
Chocolate Bayou property. The Sale proceeds will be deposited
into a segregated interest-bearing account maintained by Solutia,
and will only be released pursuant to the terms of the Longacre
stipulation. Solutia will not deposit any additional funds into
the Segregated Account, or use the funds in the Account for any
other unauthorized purpose.
Stipulation with J.V.
The J.V. Claim asserted a secured claim against Solutia and arose
from labor and materials furnished, and improvements and repairs
to Solutia's Chocolate Bayou Facility.
J.V. informally objected to the motion as it did not adequately
protect the interest of J.V., as required by Section 363 of the
Bankruptcy Code. Upon review of its books and records, Solutia
has determined that the amounts asserted by J.V. in its Claim are
accurate for the goods and services provided. The J.V. Lien has
also been determined to be valid and perfected, and fully secures
payment of the Claim.
The stipulation between Solutia and J.V. states that:
* J.V. consents to the relief sought in the Motion and
agrees to refrain from taking further action with regard
to the sale of the Property;
* The J.V. Claim is allowed as a fully secured claim against
Solutia in the amount of $467,693, plus applicable
interest; and
* If an alternate plan of reorganization is proposed by
Solutia or any other party is confirmed, the Claim will
receive the same treatment as all other fully secured
claims or allowed fully secured mechanic's lien claims, if
classified separately.
The Claim will be paid in full on the earlier of the
effective date of the confirmed Chapter 11 plan; other
date that unpaid allowed fully secured claims in the case
are paid; a date agreed on by the parties; or as directed
by the Bankruptcy Court.
Stipulation with Longacre
Before the Debtors' bankruptcy filing, Solutia entered into a
contract with Fluor for the construction of an accylonitrile plant
located at Solutia's Chocolate Bayou plant in Alvin, Brazoria
County, Texas.
Certain disputes arose; Fluor sued Solutia before the U.S.
District Court for the Southern District of Texas regarding the
Fluor Contract and the work on the AN-7 plant. Solutia and Fluor
subsequently decided on a consensual resolution and Solutia
agreed to pay $20,000,000 to Fluor.
Solutia paid the first $10,000,000 of the settlement amount. The
remainder was to be paid in semi-annual installments of
$1,666,667. The obligation to pay was secured by a mechanic's
and materialmen's lien on the AN-7 Plant and the Chocolate Bayou
Property. The Lien is deemed to be perfected as of November 8,
2000.
Solutia made the first two installment payments. Fluor filed a
secured Claim No. 4593 for the aggregate amount of the remaining
Installment Payments in the amount of $6,731,277, plus accruing
interests and other costs and expenses against Solutia in its
Chapter 11 cases.
The Claim was transferred to Longacre on June 5, 2006. To obtain
Longacre's consent to the Property Sale, Solutia and Longacre
stipulate and agree that:
* Longacre will not object to the approval of the motion or
the Sale, however, Longacre will retain its Lien on the
AN-7 Plant and the Chocolate Bayou Property other than the
Sale Property;
* The Fluor Claim will be deemed to be an allowed secured
claim and will not be subject to any objection, offset,
defense, or counterclaims, and no party may contest
Longacre's right to the allowed Fluor Claim and the
payment;
* Longacre's Lien will attach to the Sale Proceeds held in
the Segregated Account;
* Solutia will obtain the consent of the debtors-in-
possession lenders to pay the Allowed Fluor Claim in full
in conjunction with the anticipated amendment of the DIP
agreement in January 2007;
* The Sale Proceeds will remain in the Segregated Account
until released solely in accordance with the stipulation;
pursuant to a written agreement between Solutia and
Longacre; or pursuant to Court order;
* Upon full satisfaction of the Allowed Fluor Claim, the
balance of the Segregated Account will be released to
Solutia;
* If payment is not made during the pendency of Solutia's
Chapter 11 cases, Solutia will, on the effective date of a
plan, assign, transfer, deliver, and pay over to Longacre,
by wire transfer of immediately available funds to an
account specified by Longacre, the balance of the
Segregated Account; and
* To the extent the effective date account transfer does not
satisfy the Allowed Fluor Claim in full, Longacre will be
paid in full in cash on account of the remaining amount
due on the Allowed Fluor Claim on effective date, or soon
as practicable of any plan of reorganization in the
Solutia's Chapter 11 cases.
The Sale Process
As reported in the Troubled Company Reporter on Dec. 18, 2006,
James T. Strehl, general manager of the Basic Chemicals Group at
Solutia, told the Court that in April 2006, the company was
approached by an agent acting on behalf of an anonymous buyer,
later revealed to be Shintech. Houston, Texas-based Shintech is
the largest producer of the chemical polyvinyl chloride in the
United States. Shintech sought to purchase a parcel of the
Unoccupied Chocolate Bayou Property to construct a chemical
manufacturing plant.
Shintech is a subsidiary of the Japanese diversified chemicals
company, Shin-Etsu Chemical Co., Ltd. Shintech initially offered
to purchase approximately 900 acres of the Unoccupied Chocolate
Bayou Property for $6,200 per acre, for a total purchase price of
$5,580,000.
To evaluate the offer, in July 2006, Solutia hired American
Appraisal Associates to perform an appraisal of the 900 acres of
Unoccupied Chocolate Bayou Property. American Appraisal
submitted an appraisal report to Solutia, dated September 1,
2006, which concluded that Shintech's initial offer of $6,200 per
acre exceeded the appraised value of the land.
The Appraisal Report assumed it would take Solutia 12 to 24
months to sell the land for the appraised amount.
After the Parties executed a letter of intent and Shintech began
its due diligence, the Parties engaged in good faith, arm's-
length negotiations. These negotiations resulted in the Parties
agreeing that Shintech would purchase only 482 acres of the
Unoccupied Chocolate Bayou Property for $14,750 an acre, or a
total price of $7,109,500. The Purchase Price represents an
increase of $8,550 per acre over Shintech's initial offer,
Mr. Henes noted.
The Purchase Agreement
Pursuant to the CB Land Purchase Agreement, Shintech will pay the
$7,109,500 purchase price at closing in cash. Shintech also
agreed to allow Solutia to continue to run its underground pipes
and above ground transportation over the Sale Property.
Other terms of the CB Land Purchase Agreement are:
Earnest Money: Shintech paid Solutia a $25,000 non-refundable
deposit, which will be credited against the
Purchase Price. Shintech also deposited
$475,000 with Stewart Title Company, as Escrow
Agent. This amount will be credited against
the Purchase Price, or in the event the Sale
is not consummated, it will be distributed
pursuant to the terms of the Escrow Agreement.
Title/
Permitted
Encumbrances: Solutia presently has and will convey to
Shintech good and indefeasible title to the
Property on the Closing Date subject only to:
(i) general real estate taxes for the
current year,
(ii) local, state and federal laws,
ordinances or governmental regulations,
(iii) any title matter approved, or caused, by
Shintech,
(iv) existing easements and other rights-of-
way affecting the Property, and
(v) the Ancillary Agreements.
Covenants: Solutia agrees to use good faith efforts to
obtain approval of the Sale by December 28,
2006. The Parties will use good faith efforts
to negotiate the terms of the Ancillary
Agreements.
Conditions
to Closing: The Conditions to Shintech's Obligation to
Close are typical for a transaction of this
type, including:
(i) all of Solutia's representations and
warranties will be true and correct,
(ii) no encumbrances or title defects other
than Permitted Encumbrances,
(iii) all of Solutia's covenants performed,
(iv) no material adverse change in the
condition of the Property,
(v) the Parties have agreed upon the terms
of the Ancillary Agreements, and
(vi) to preserve the December 29, 2006
closing date, an Approval Order obtained
by no later than December 28, 2006.
The Conditions to Solutia's Obligation to
Close are typical for a transaction of this
type, including:
(i) all of Shintech's representations and
warranties will be true and correct,
(ii) Shintech will have performed all
covenants,
(iii) Approval Order will be obtained by
March 31, 2007 and
(iv) the Parties will have agreed upon the
terms of the Ancillary Agreements.
Proration of
Taxes: General real estate taxes for the current year
relating to the Property will be allocated
between Solutia and Shintech based on the
Closing Date.
Attorneys'
Fees &
Legal
Expenses: If either party institutes any action or
proceeding related to the CB Land Purchase
Agreement, the prevailing party is entitled
to receive all reasonable attorneys' fees and
court costs from the losing party.
Right of
First
Refusal: In the event Shintech acquires the Sale
Property, but does not construct a chemical
manufacturing facility on it, and subsequently
decides to sell all or part of the Property,
it will provide Solutia the right to meet a
bona fide third-party offer for the purchase
of the Property.
About Solutia Inc.
Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in the
manufacture and sale of chemical-based materials, which are used
in consumer and industrial applications worldwide. The company
and 15 debtor-affiliates filed for chapter 11 protection on
Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the
Debtors filed for protection from their creditors, they listed
$2,854,000,000 in assets and $3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., at Kirkland &
Ellis. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel
J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the
Official Committee of Unsecured Creditors, and Derron S. Slonecker
at Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Debtors' exclusive period to
file a plan expires on Jan. 15, 2007. (Solutia Bankruptcy News,
Issue No. 75; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
SOLUTIA INC: Projects Rise in Earnings 5 Years After Bankr. Exit
----------------------------------------------------------------
Solutia Inc. expects its earnings to rise in the next five years
following its exit from chapter 11, according to its revised
business plan provided to certain holders of 6.72% notes due
Oct. 15, 2037, or the 7.375% notes due Oct. 15, 2027, it issued
pursuant to an Indenture dated Oct. 1, 1997.
Solutia presented the business plan, which includes both
historical and projected financial information, to Noteholders
pursuant to the terms of a confidentiality agreement entered into
on Dec. 8, 2006.
Solutia's net income of $8,000,000, including a $44,000,000 gain
from one-time items, for the year 2006 changed little from 2005.
Solutia expects its profit from continuing operations, which
excludes some items, to be $79,000,000 in 2007; $124,000,000 in
2008; $166,000,000 in 2009; $197,000,000 in 2010; and
$228,000,000 in 2011.
Solutia's financial projections assume emergence from Chapter 11
on December 31, 2006. Each quarter delay in emergence accounts
for an additional cash outlay of $25,000,000 for lack of OPEB
funding and reorganization professional fees. Total cash paid at
emergence is assumed to be $301,000,000:
-- $152,000,000 for exit related costs; and
-- $149,000,000 to fund the 2007 domestic pension plan.
A full-text copy of the Dec. 8, 2006 draft business plan is
available for free at http://researcharchives.com/t/s?184c
About Solutia Inc.
Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in the
manufacture and sale of chemical-based materials, which are used
in consumer and industrial applications worldwide. The company
and 15 debtor-affiliates filed for chapter 11 protection on
Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the
Debtors filed for protection from their creditors, they listed
$2,854,000,000 in assets and $3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., at Kirkland &
Ellis. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel
J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the
Official Committee of Unsecured Creditors, and Derron S. Slonecker
at Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Debtors' exclusive period to
file a plan expires on Jan. 15, 2007. (Solutia Bankruptcy News,
Issue No. 75; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
SONTRA MEDICAL: Nasdaq Suspends Common Stock Quotation
------------------------------------------------------
In connection with Sontra Medical Corporation's decision to
voluntarily delist from the Nasdaq Capital Market, the quotation
of the company's common stock was suspended by Nasdaq on
January 8.
Although the quotation of Sontra's common stock has been
suspended, the company will remain subject to Nasdaq rules until
its delisting is effective on Jan. 18, 2007.
As of Jan. 8, 2007, the company's quotation for its common stock
is expected to appear in the "Pink Sheets" under the symbol
"SONT." The company's common stock may also be quoted in the
future on the OTC Bulletin Board provided a market maker files the
necessary application with the NASD and such application is
cleared.
Following its delisting from Nasdaq, the company expects to remain
a public company and to continue to make its required SEC filings.
Based in Franklin, Massachusetts, Sontra Medical Corporation
(Nasdaq: SONT) -- http://www.sontra.com/-- develops platform
technology for transdermal science. In addition, the company owns
technology for transdermal delivery of large molecule drugs and
vaccines.
As reported in the Troubled Company Reporter on Dec. 29, 2006, the
company disclosed that it will cease operations because it has
been unable to raise additional capital. The company has also
elected to voluntarily delist from the Nasdaq Capital Market. The
company has provided a voluntary delisting notice to the Nasdaq
Stock Market.
STAGE ONE: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: Stage One, Inc.
P.O. Box 2597
Chattanooga, TN 37409
Bankruptcy Case No.: 06-14567
Chapter 11 Petition Date: December 29, 2006
Court: Eastern District of Tennessee (Chattanooga)
Judge: John C. Cook
Debtor's Counsel: Bruce C. Bailey, Esq.
Harold L North, Jr., Esq.
Chambliss, Bahner and Stophel, P.C.
Two Union Square, Suite 1000
Chattanooga, TN 37402
Tel: (423) 756-3000
Fax: (423) 265-9574
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $100,000 to $1 Million
The Debtor did not file a list of its 20 Largest Unsecured
Creditors.
STRUCTURED ASSET: Moody's Rates Class B1 Certificates at Ba1
------------------------------------------------------------
Moody's Investors Service has assigned an Aaa rating to the senior
certificates issued by Structured Asset Securities Corporation
2006-Z, and ratings ranging from Aa2 to Ba1 to the subordinate
certificates in the deal.
The securitization is backed by Option One Mortgage Corporation,
BNC Mortgage, Inc and various other originators originated,
adjustable-rate and fixed-rate, subprime loans. The ratings are
based primarily on the credit quality of the loans, and on the
protection from subordination, excess spread, and
overcollateralization. The ratings also benefit from an interest-
rate swap agreement provided by HSBC Bank USA, N.A.
Moody's expects collateral losses to range from 7.65% to 8.15%.
Option One Mortgage Corporation, JP Morgan Chase Bank, National
Association, Wells Fargo Bank, N.A. and Aurora Loan Services LLC
will service the loans. Aurora Loans Services LLC will also act
as master servicer. Moody's has assigned its top servicer quality
rating of SQ1 to Option One Mortgage Corporation, JP Morgan Chase
Bank, National Association, Wells Fargo Bank, N.A. as a primary
servicer of subprime loans. Moody's has assigned Aurora Loan
Services LLC its servicer quality rating of SQ1- as a master
servicer.
These are the rating actions:
* Structured Asset Securities Corp 2006-Z
* Mortgage Pass- Through Certificates, Series 2006-Z
Class A1, Assigned Aaa
Class A2, Assigned Aaa
Class M1, Assigned Aa2
Class M2, Assigned Aa3
Class M3, Assigned A2
Class M4, Assigned Baa1
Class M5, Assigned Baa2
Class M6, Assigned Baa3
Class B1, Assigned Ba1
The certificates were sold in privately negotiated transactions
without registration under the Securities Act of 1933 under
circumstances reasonably designed to preclude a distribution
thereof in violation of the Act. The issuance has been designed
to permit resale under Rule 144A.
SUNCOM WIRELESS: Board Okays Termination of Compensation Plan
-------------------------------------------------------------
SunCom Wireless Holdings Inc.'s board of directors, pursuant to a
unanimous written consent dated as of Dec. 29, 2006, approved the
termination of its nonqualified deferred compensation plan
effective as of Dec. 31, 2006.
The board also directed the company's management to amend the Plan
to distribute all accumulated benefits under the Plan in 2007 in
accordance with transition guidance under Section 409A of the
Internal Revenue Code.
The termination was recommended by the company's management
because of the limited participation in the Plan.
The company disclosed that the unfunded aggregate accumulated
deferrals accrued at Nov. 30, 2006 were approximately $300,000, a
portion of which represent stock compensation that it expects will
be paid-out in the form of shares of the company's Class A common
stock.
The Plan was implemented in June 2004 for the benefit of certain
management employees and members of the company's Board of
Directors.
Based in Berwyn, Pennsylvania, SunCom Wireless Holdings Inc.
(NYSE: TPC) -- http://www.suncom.com/-- offers digital wireless
communications services to more than one million subscribers in
the southeastern United States, Puerto Rico and the U.S. Virgin
Islands. SunCom is committed to delivering Truth in Wireless by
treating customers with respect, offering simple, straightforward
plans and by providing access to the largest GSM network and the
latest technology choices.
SunCom Wireless' balance sheet showed a stockholders' deficit of
$378,099,000 at Sept. 30, 2006, compared with a deficit of
$338,223,000 at June 30, 2006.
SUSAN GREENFIELD: Case Summary & 15 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Susan P. Greenfield
dba Servicargo, Miami
1580 Sandpiper Circle
Weston, FL 33327
Bankruptcy Case No.: 07-10076
Type of Business: The Debtor filed for chapter 11
protection on November 15, 2006
(Bankr. S.D. Fla. Case No. 06-15885).
Chapter 11 Petition Date: January 5, 2007
Court: Southern District of Florida (Fort Lauderdale)
Judge: Raymond B. Ray
Debtor's Counsel: Sherri B. Simpson, Esq.
Sherri B. Simpson, P.A.
517 Soutwest 1 Avenue
Fort Lauderdale, FL 33301
Tel: (954) 524-4141
Fax: (954) 763-5117
Estimated Assets: $100,000 to $1 Million
Estimated Debts: $1 Million to $100 Million
Debtor's 15 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Honk Food Final Judgment $2,068,827
International, S. de R.L.
c/o Robert Goldman, Esq.
1 East Broward Boulevard
Suite 700
Fort Lauderdale, FL 33301
Florida Department of Court Ordered $72,169
Corrections Restitution
Court Ordered Payments
P.O. Box 12300
Tallahassee, FL 32317-2300
Bank of America Charge Account $14,420
P.O. Box 1598
Norfolk, VA 23501
Amex Credit Card Purchase $11,381
Maria Conde Vehicle Loan $9,000
B-Line, LLC Debt to Citibank $6,410
MBNA America Credit Card Purchase $3,404
Afni, Inc. Collection $1,533
Merchant's Credit Guide Co. Collection for $1,194
Shell Oil
Central Financial Control Collection Cleveland $890
Clinic Hospital
Sterling & King, Inc. Collection $801
CBE Group Collection Dish $746
Network
KCA Financial Services Collection - MCI $600
Professional Adjustment Collection $377
Internal Revenue Service Audit Unknown
TERRY ALBERTSEN: Case Summary & 18 Largest Unsecured Creditors
--------------------------------------------------------------
Debtors: Terry A. Albertsen
Kathryn L. Albertsen
dba Albertsen's Home Furnishings
dba Sofa And Mattress Center
aka Terance A. Albertsen
3961 El Dorado Road
Placerville, CA 95667
Bankruptcy Case No.: 07-20060
Chapter 11 Petition Date: January 3, 2007
Court: Eastern District of California (Sacramento)
Judge: Christopher M. Klein
Debtors' Counsel: David M. Meegan, Esq.
Meegan, Hanschu & Kassenbrock
1545 River Park Drive, Suite 550
Sacramento, CA 95815-4615
Tel: (916) 925-1800
Total Assets: $4,175,784
Total Debts: $3,060,542
Debtors' 18 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Thor Credit Corporation Bank Loan $175,000
P.O. Box 91826 Secured:
Los Angeles, CA 90051-6126 $135,000
Unsecured:
$40,000
California State Board of Trade Debt $31,426
Equalization
P.O. Box 942879
Sacramento, CA 94279-0029
Dreamlounger 3559 Trade Debt $12,518
P.O. Box 1507
Sherwood, OR 97140
Yellow Book USA Trade Debt $7,424
Pro Style Publishing Trade Debt $6,528
Wells Fargo Mastercard Trade Debt $6,035
Goodman & Associates Bank Loan $5,931
Samuel Lawrence Trade Debt $5,760
Williams & Shedd Trade Debt $4,537
WFS Financial Bank Loan $24,000
Secured:
$20,000
Unsecured:
$4,000
Transworld Systems, Inc. Trade Debt $3,237
Internal Revenue Service Trade Debt $1,920
Simmons Mattress Trade Debt $1,870
Trend Manor Trade Debt $1,152
Apria Healthcare Medical Expense $1,087
Winners Only Trade Debt $871
California Furniture Trade Debt $617
Valley Yellow Pages Trade Debt $104
TERWIN MORTGAGE: Losses Prompt Moody's Possible Ratings Downgrade
-----------------------------------------------------------------
Moody's Investors Service has placed the ratings of three classes
from Terwin Mortgage Trust on review for possible downgrade. The
collateral backing these classes consists of second lien
residential mortgage loans.
The ratings are being reviewed based upon the recent pace of
losses accompanied by deterioration of credit enhancement.
These are the rating actions:
* Terwin Mortgage Trust 2005-1SL
-- Class B-4, Currently Ba2, on review for possible
downgrade
* Terwin Mortgage Trust 2005-3SL
-- Class B-6-PI, Currently Ba2, on review for possible
downgrade
* Terwin Mortgage Trust 2006-2HGS
-- Class B-7, Currently Ba3, on review for possible
downgrade
THERMADYNE HOLDINGS: To Record Impairment Charge on Divestitures
----------------------------------------------------------------
Thermadyne Holdings Corporation concluded that an impairment
charge, estimated to be between $10 million and $13 million
primary related to the writing off of goodwill and intangible
assets as a result of its divestitures of Maxweld and Thermadyne
South Africa, is required.
The impairment charge is to be recorded in the fourth quarter of
fiscal 2006 and the company expects it to be offset by cash
received in the transaction. In addition, the company estimates
that less than $100,000 of the impairment charge will result in
future cash expenditures.
The company does not expect to incur any material costs or charges
in connection with the divestitures, other than the impairment
charge.
The company's board of directors and management previously
committed to divest from its South African subsidiaries, Maxweld &
Braze Pty. Ltd. and Thermadyne South Africa (Pty.) Ltd., as part
of its evaluation of its non-core operations. Maxweld is a
wholesaler with an outlet in Johannesburg, South Africa, and
Thermadyne South Africa is a retailer with a network of stores
throughout South Africa.
The company expects to receive a combined total of between
$19 million and $20 million from the two divestitures. The
companyt expects that at least 75% of the sale proceeds will be
paid in cash at the closing, which it anticipates could occur in
the middle of the first quarter of 2007. The Company also expects
that the balance, as adjusted for foreign currency fluctuations,
would likely be paid within three years.
The company intends to use the proceeds from the proposed
divestitures to further reduce debt.
Based in St. Louis, Missouri, Thermadyne Holdings Corporation
(Pink Sheets: THMD) -- http://www.Thermadyne.com/-- markets
cutting and welding products and accessories under a variety of
brand names including Victor(R), Tweco(R), Arcair(R), Thermal
Dynamics(R), Thermal Arc(R), Stoody(R), and Cigweld(R). Its
common shares trade under the symbol THMD.PK.
* * *
As reported in the Troubled Company Reporter on Oct. 30, 2006,
Moody's Investors Service, in connection with the implementation
of its new Probability-of-Default and Loss-Given-Default rating
methodology for the U.S. manufacturing sector, confirmed the Caa1
Corporate Family Rating for Thermadyne Holdings Corporation, as
well as the Caa2 rating on the company's $175 Million 9.25% Senior
Subordinate Notes due Feb. 1, 2014. Those debentures were
assigned an LGD5 rating suggesting noteholders will experience a
73% loss in the event of default.
UAP HOLDING: Posts $13.1 Mil. Net Loss in Quarter Ended Nov. 26
---------------------------------------------------------------
UAP Holding Corp. submitted its quarterly report on Form 10-Q to
the Securities and Exchange Commission on Jan. 4, 2007.
The company reported a $13.1 million net loss for the third
quarter ended Nov. 26, 2006, compared with a net loss of
$5.2 million for the same quarter 2005.
Operating loss was $9.9 million for the quarter ended Nov. 26,
2006, versus an operating loss of $3.7 million for the comparable
quarter in 2005.
Net sales increased 16.3% to $375.7 million for the quarter ended
Nov. 26, 2006, compared with $323.1 million for the same period in
2005. Chemical sales related to the acquisition of UAP Timberland
were $37.9 million.
Gross profit was $40.6 million for the quarter ended Nov. 26,
2006, compared with $50.5 million in the same quarter in 2005.
Gross margin was 10.8% for the quarter, compared with 15.6% in the
comparable quarter of 2005.
At Nov. 26, 2006, there was $371.9 million of borrowings
outstanding under the senior secured asset based revolving credit
facility and United Agri Products, Inc. had additional borrowing
capacity of $287.7 million after giving effect to $15.4 million of
letters of credit under the sub-facility. At Nov. 27, 2005, the
company had $148.9 million debt outstanding under its prior
revolving credit facility, which was refinanced on June 1, 2006.
A full text-copy of the company's quarterly report on Form 10-Q
may be viewed at no charge at http://ResearchArchives.com/t/s?183f
UAP Holding Corp. (Nasdaq: UAPH) -- http://www.uap.com/-- is the
holding company of United Agri Products, Inc., an independent
distributor of agricultural and non-crop inputs in the United
States and Canada. United Agri Products markets a line of
products, including crop protection chemicals, seeds and
fertilizers, to growers and regional dealers. United Agri
Products also provides an array of value-added services, including
crop management, biotechnology advisory services, custom blending,
inventory management and custom applications of crop inputs.
United Agri Products maintains a network of approximately 330
distribution and storage facilities and three formulation and
blending plants, strategically located throughout the United
States and Canada.
* * *
Moody's Investors Service upgraded UAP Holding Corp.'s corporate
family rating to Ba3 from B1. Moody's also assigned a Ba2 rating
to United Agri Products, Inc.'s senior secured $675 million
revolving credit due 2011. UAP's $175 million senior secured term
loan due 2012 was assigned a Ba3 rating.
US AIRWAYS: Ups Offer for Delta Air to $10.2 Billion
----------------------------------------------------
US Airways Group, Inc. disclosed Wednesday that it has increased
its offer to merge with Delta Air Lines, Inc.
Under the revised proposal:
* Delta's unsecured creditors would receive $5.0 billion in
cash and 89.5 million shares of US Airways stock.
* When applying the same valuation methodology and
assumptions as described in Delta's Disclosure Statement,
US Airways' advisor Citigroup estimates this new proposal
will provide between $12.7 and $15.4 billion in value to
Delta's unsecured creditors, which represents a significant
premium over the $9.4 to 12.0 billion valuation that Delta
places on its stand-alone plan.
* Based on the closing price of US Airways stock as of
Tuesday, Jan. 9, 2007, the new proposal has a current market
value of approximately $10.2 billion.
The merger is expected to be accretive to US Airways' earnings per
share in the first full year after completion of the merger.
The increased offer is set to expire on Feb. 1, 2007 unless there
is affirmative creditor support for commencement of due diligence,
making the required filings under Hart-Scott-Rodino, as well as
the postponement of Delta's hearing on its Disclosure Statement
scheduled for Feb. 7, 2007.
US Airways has committed financing from Citigroup and Morgan
Stanley for the proposed transaction for $8.2 billion,
representing $5.0 billion to fund the cash portion of the offer
and $3.2 billion in refinancing existing obligations at both US
Airways and Delta.
US Airways Chairman and Chief Executive Officer Doug Parker
stated, "While our original proposal offered substantially more
value to Delta's unsecured creditors than the Delta stand-alone
plan, we are making this revised offer to eliminate any doubt that
a merger with US Airways offers Delta's unsecured creditors
significantly more value. Without the support of the creditors,
our offer is set to expire on Feb. 1. It is time for this process
to move forward. We continue to believe that this is the right
time to create a better airline that provides more choice to
consumers, increased job security for both airlines' employees and
generates more value for all of our stakeholders."
Consumers across the nation will benefit from greater choice and
lower fares from the "New" Delta. Since the combination of
America West and US Airways in 2005, US Airways has lowered
leisure and business fares by up to 83 percent in about 1,000
markets. Every domestic destination served today by either US
Airways or Delta will continue to be served by the New Delta,
which will provide consumers across the nation access to a larger
network that connects them to more people and places.
Employees also will benefit from working for a larger and more
competitive airline. As US Airways has already announced,
frontline employees of the New Delta will move to the higher cost
structure of the combined airlines, and there will be no furloughs
of frontline employees of either Delta or US Airways. The
combination of US Airways and America West, which was accomplished
without any involuntary mainline furloughs despite capacity
reductions of 15 percent, demonstrates that a merger can be in the
best interests of employees, not just shareholders.
"This is a transaction that makes sense for US Airways
stockholders, Delta creditors, the employees and customers of both
companies, and the communities that we serve," said Mr. Parker.
The revised US Airways proposal retains the same conditions as the
original offer and is conditioned on satisfactory completion of a
due diligence investigation, which the company believes can be
completed expeditiously, approval by Delta's Bankruptcy Court of a
mutually agreeable plan of reorganization that would be predicated
upon the merger, regulatory approvals, and the approval of the
shareholders of US Airways.
Citigroup Corporate and Investment Banking is acting as financial
advisor to US Airways, and Skadden, Arps, Slate, Meagher & Flom
LLP is acting as primary legal counsel, with Fried, Frank, Harris,
Shriver & Jacobson LLP as lead antitrust counsel to US Airways.
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.
About US Airways
Headquartered in Arlington, Virginia, US Airways Group Inc.'s
(NYSE: LCC) -- http://www.usairways.com/-- primary business
activity is the ownership of the common stock of:
* US Airways, Inc.,
* Allegheny Airlines, Inc.,
* Piedmont Airlines, Inc.,
* PSA Airlines, Inc.,
* MidAtlantic Airways, Inc.,
* US Airways Leasing and Sales, Inc.,
* Material Services Company, Inc., and
* Airways Assurance Limited, LLC.
Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts. In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts.
The Debtors' chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date.
US Airways, US Airways Shuttle, and US Airways Express operate
approximately 3,800 flights per day and serve more than
230 communities in the U.S., Canada, Europe, the Caribbean, and
Latin America. The new US Airways is a member of the Star
Alliance, which provides connections for customers to
841 destinations in 157 countries worldwide.
US AIRWAYS: S&P Retains Dev. Watch Despite Revised Delta Offer
--------------------------------------------------------------
Standard & Poor's Ratings Services stated that its ratings on US
Airways Group, including the 'B-' corporate credit ratings on US
Airways Group and its major operating subsidiaries America West
Holdings Corp., America West Airlines Inc., and US Airways Inc.,
remain on CreditWatch with developing implications, where they
were initially placed on Nov. 15, 2006.
US Airways revised its proposal to merge with Delta Air Lines
Inc., under which both companies would combine upon Delta's
emergence from bankruptcy, expected in the first half of 2007.
The revised proposal, for which US Airways already has
$8.2 million of committed financing, would provide approximately
$10 billion in cash and stock to Delta's unsecured creditors, an
approximate 19% increase over the previous proposal. The
combination would result in one of the world's largest airlines
and US Airways still estimates annual revenue/cost synergies of
$1.7 billion when fully phased in over a two-year period. The
revised proposal will expire on Feb. 1, 2007, unless there is
affirmative creditor support for commencement of due diligence, a
Hart Scott Rodino filing, and a postponement of Delta's scheduled
Feb. 7, 2007, bankruptcy disclosure statement hearing. Delta's
official creditor committee, the principal group whose approval is
needed for the merger, has hired airline industry veteran Gordon
Bethune as its advisor, a development that US Airways' views as
positive.
"If US Airways is successful in completing the merger with Delta
and realizing US Airways' expected synergies, ratings could be
raised modestly," said Standard & Poor's credit analyst Betsy
Snyder.
"If US Airways completes the merger but encounters problems with
integrating both airlines, particularly among the different labor
groups, ratings could be lowered."
Standard & Poor's will assess the combined entity's operational
synergies and the effect of the increased level of debt on its
financial profile in resolving the CreditWatch.
USG CORPORATION: IINA Objects to Assume All Contacts Proposal
-------------------------------------------------------------
Indemnity Insurance Company of North America objects to USG
Coporation and its debtor affiliates proposal to assume all of
their executory contracts pursuant to their Chapter 11 Plan.
In October 2006, the Reorganized Debtors served IINA with a notice
regarding the assumption of an insurance policy identified by the
Reorganized Debtors as USG ID No. 1291.
On behalf of IINA, James C. Carignan, Esq., at Pepper Hamilton
LLP, in Wilmington, Delaware, informs the Court that although the
investigation is not yet complete, it appears that IINA and its
affiliates have issued various insurance policies to the
Reorganized Debtors over the years, and may have entered into
other related agreements with one or more of the Reorganized
Debtors.
IINA objects to the Reorganized Debtors' proposed assumption of
the Insurance Policy because:
(1) the Reorganized Debtors failed to list all the executory
contracts between the parties that have existed in the
past. IINA asserts that to the extent other executory
contracts exist, the Reorganized Debtors must assume them;
(2) the Notice fails to give any meaningful detail as to the
insurance policy to be assumed; and
(3) the Reorganized Debtors do not propose to cure any
existing defaults, provide any assurance of a cure, or
provide adequate assurance of future performance.
IINA and its affiliates reserve the right to amend or supplement
the objection as their investigation reveals additional
information relating to contracts between the parties.
Based in Chicago, Ill., USG Corporation -- http://www.usg.com/--
through its subsidiaries, manufactures and distributes building
materials producing a wide range of products for use in new
residential, new nonresidential and repair and remodel
construction, as well as products used in certain industrial
processes.
The company filed for chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094). David G. Heiman, Esq., Gus
Kallergis, Esq., Brad B. Erens, Esq., Michelle M. Harner, Esq.,
Mark A. Cody, Esq., and Daniel B. Prieto, Esq., at Jones Day
represent the Debtors in their restructuring efforts. Lewis
Kruger, Esq., Kenneth Pasquale, Esq., and Denise Wildes, Esq.,
represent the Official Committee of Unsecured Creditors. Elihu
Inselbuch, Esq., and peter Van N. Lockwood, Esq., at Caplin &
Drysdale, Chartered, represent the Official Committee of Asbestos
Personal Injury Claimants. Martin J. Bienenstock, Esq., Judy G.
Z. Liu, Esq., Ralph I. Miller, Esq., and David A. Hickerson, Esq.,
at Weil Gotshal & Manges LLP represent the Statutory Committee of
Equity Security Holders. Dean M. Trafelet is the Future Claimants
Representative. Michael J. Crames, Esq., and Andrew A. Kress,
Esq., at Kaye Scholer, LLP, represent the Future Claimants
Representative. Scott Baena, Esq., and Jay Sakalo, Esq., at
Bilzen Sumberg Baena Price & Axelrod LLP, represent the Asbestos
Property Damage Claimants Committee.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. The
Debtors emerged from bankruptcy protection on June 20, 2006. (USG
Bankruptcy News, Issue No. 127; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
USG CORPORATION: Court Okays Modification to Discharge Injunction
-----------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware grants the Reorganized USG Coporation
and its debtor affiliates request, to modify their joint plan of
reorganization and the confirmation order, in its entirety and
rules that the Bankruptcy Court will have exclusive jurisdiction
to resolve any controversy relating to the Claims and the Class
Action, subject to the right of any party to request the
modification of the Discharge Injunction to liquidate the Claims
in a different forum.
The Reorganized Debtors ask the Court to modify their Joint Plan
of Reorganization and the Confirmation Order with regard to
injunction against pursuing liquidation of claims in a forum other
than the Bankruptcy Court.
The Reorganized Debtors seek to modify the Discharge Injunction
solely to permit the South Carolina Circuit Court of Hampton
County, South Carolina, to approve the settlement agreement
between United States Gypsum Company and Anderson Memorial
Hospital.
U.S. Gypsum Co. and Anderson, on behalf of itself and other
similarly situated members, entered into a settlement agreement
with respect to various asbestos property damage claims subject to
a prepetition class action in the Circuit Court.
Pursuant to the Settlement Agreement, and if approved by the
Circuit Court:
(a) The Reorganized Debtors will pay a lump sum, with
interest, in complete satisfaction of the claims;
(b) Anderson's Claim Nos. 5697, 5698, 6286, and 6289 will be
allowed in Class 8 under the Plan in the amount of the
Settlement Fund;
(c) The claims filed by other plaintiffs in the Class Action
will be subsumed within Anderson's Claims, and disallowed
and expunged; and
(d) Distribution of the Settlement Fund will be a part of the
Class Action. In return, the Debtors will receive a
release of all the Asbestos Property Damage Claims of the
class and a right of indemnification.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
P.A., in Wilmington, Delaware, relates that the Settlement
Agreement is contingent upon the Circuit Court approving it
without modification.
The parties have agreed that the Discharge Injunction will be
modified solely to the extent necessary to obtain the Circuit
Court's approval of the Settlement Agreement.
The parties further agreed that if the Circuit Court does not
approve the Settlement Agreement, the Discharge Injunction will be
reinstated, all proceedings before the Circuit Court will cease
and be stayed, and the parties will be returned to the status quo
that existed as of the date of the Settlement Agreement.
Mr. DeFranceschi notes that the Reorganized Debtors may terminate
the Settlement Agreement if, among other things:
-- it is disapproved or modified by the Circuit Court or by
any appellate court;
-- dismissal of the Class Action with prejudice as to the
Reorganized Debtors cannot be accomplished;
-- a final judgment on the Settlement Agreement's terms is
not entered; or
-- it is not fully consummated and effected.
Mr. DeFranceschi emphasizes that the Reorganized Debtors are not
seeking the Court's approval of the Settlement Agreement, but they
are only requesting the Court to modify the Discharge Injunction
on a limited basis to permit the parties to seek the Circuit
Court's approval of the Settlement Agreement, which will result in
the liquidation of the asbestos property damage claims.
Based in Chicago, Ill., USG Corporation -- http://www.usg.com/--
through its subsidiaries, manufactures and distributes building
materials producing a wide range of products for use in new
residential, new nonresidential and repair and remodel
construction, as well as products used in certain industrial
processes.
The company filed for chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094). David G. Heiman, Esq., Gus
Kallergis, Esq., Brad B. Erens, Esq., Michelle M. Harner, Esq.,
Mark A. Cody, Esq., and Daniel B. Prieto, Esq., at Jones Day
represent the Debtors in their restructuring efforts. Lewis
Kruger, Esq., Kenneth Pasquale, Esq., and Denise Wildes, Esq.,
represent the Official Committee of Unsecured Creditors. Elihu
Inselbuch, Esq., and peter Van N. Lockwood, Esq., at Caplin &
Drysdale, Chartered, represent the Official Committee of Asbestos
Personal Injury Claimants. Martin J. Bienenstock, Esq., Judy G.
Z. Liu, Esq., Ralph I. Miller, Esq., and David A. Hickerson, Esq.,
at Weil Gotshal & Manges LLP represent the Statutory Committee of
Equity Security Holders. Dean M. Trafelet is the Future Claimants
Representative. Michael J. Crames, Esq., and Andrew A. Kress,
Esq., at Kaye Scholer, LLP, represent the Future Claimants
Representative. Scott Baena, Esq., and Jay Sakalo, Esq., at
Bilzen Sumberg Baena Price & Axelrod LLP, represent the Asbestos
Property Damage Claimants Committee.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. The
Debtors emerged from bankruptcy protection on June 20, 2006.
(USG Bankruptcy News, Issue No. 127; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
USP DOMESTIC: UNCN Deal Cues Moody's Ratings Review for Downgrade
-----------------------------------------------------------------
Moody's Investors Service placed the ratings for USP Domestic
Holdings Inc. under review for possible downgrade after the recent
disclosure that its parent entered into an agreement to merge with
UNCN Acquisition Corp., an affiliate of private equity firm Welsh
Carson, Anderson & Stowe.
Holdings is a wholly-owned subsidiary of United Surgical Partners
International, Inc., the ultimate parent company. Under the terms
of the merger agreement, holders of USPI common stock will receive
$31.05 per share in cash for their shares in a transaction valued
at $1.8 billion, including the assumption of USPI debt.
Moody's expects that Welsh Carson will re-leverage USPI's balance
sheet as a consequence of taking the company private. The rating
agency also expects that existing debt instruments of USPI will be
refinanced as part of this transaction. If this transpires, the
ratings will be withdrawn at the time of close of the new
financing. It is Moody's understanding that a permanent
refinancing plan has not yet been completed.
Once information on the new structure is obtained, Moody's rating
review will primarily focus on the company's financial flexibility
after the leveraged buyout. The most important factors in that
analysis are expected to be the financial structure and legal
entities, the business strategy of the company going forth, the
details surrounding the company's external sources of liquidity
and the level of commitment to debt repayment.
These ratings were placed under review for possible downgrade:
-- $200 million senior secured term loan 'B' due 2013, rated
Ba2, LGD3, 35%
-- Corporate Family Rating, rated Ba2
-- PDR, rated Ba3
United Surgical Partners International, headquartered in Dallas,
Texas, currently has ownership interests in or operates 141
surgical facilities. Of the Company's 138 domestic facilities, 78
are jointly owned with not-for-profit healthcare systems. The
Company also operates three facilities in London, England. For
the last twelve months ended Sept. 30, 2006 the company reported
revenues of $540 million.
VALASSIS COMMS: Defines Hotchkis and Wiley Capital as Investors
---------------------------------------------------------------
Valassis Communications Inc. entered into amendment No. 2 to the
rights agreement, dated as of Sept. 1, 1999, with National City
Corporation, as rights agent.
The Amendment amends the definition of "Investor" to include
Hotchkis and Wiley Capital Management, LLC. The Amendment will
permit Hotchkis and Wiley Capital Management to become the
beneficial owner of up to 20% of the outstanding shares of the
company's common stock without being deemed to be an Acquiring
Person, as defined in the Rights Agreement, and therefore not
triggering any adverse event under the Rights Agreement.
A full text-copy of Amendment No. 2 to the Rights Agreement
between Valassis Communications, Inc. and National City
Corporation, as rights agent may be viewed at no charge at
http://ResearchArchives.com/t/s?184a
Headquartered in Livonia, Michigan, Valassis Communications Inc.
(NYSE: VCI) -- http://www.valassis.com/-- provides marketing
services to consumer-packaged goods manufacturers, retailers,
technology companies and other customers with operations in the
United States, Europe, Mexico and Canada. Valassis' products and
services portfolio includes: newspaper-delivered promotions and
advertisements such as inserts, sampling, polybags and on-page
advertisements; direct-to-door advertising and sampling; direct
mail; Internet-delivered marketing; loyalty marketing software;
coupon and promotion clearing; and promotion planning and analytic
services. Valassis subsidiaries include Valassis Canada,
Promotion Watch, Valassis Relationship Marketing Systems, LLC and
NCH Marketing Services Inc.
* * *
As reported in the Troubled Company Reporter on Nov. 1, 2006,
Moody's Investors Service downgraded Valassis Communications,
Inc.'s senior unsecured note ratings to Ba1 from Baa3. Moody's
also assigned a Ba1 Corporate Family Rating, Ba1 Probability of
Default Rating, and LGD4 loss given default assessments to
Valassis' debt securities. The ratings remain on review for
downgrade.
WERNER LADDER: Gets Interim OK on Executive Incentive Payment Plan
------------------------------------------------------------------
The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware authorized, but did not require, Werner
Holding Co. (DE) Inc. aka Werner Ladder Company and its debtor-
affiliates to:
(i) adopt and implement an executive incentive plan for the
fourth quarter of 2006; and
(ii) make incentive payments related to the revised 2006
budget to eligible executives.
In addition, the Court permitted the Debtors to execute and
perform their obligations under certain non-complete agreements
and pay the eligible executives under those agreements.
Payment of the Debtors' obligations to their prepetition lenders
will be subject to the payment of all the incentive payments and
non-compete payments earned but not yet paid under the executive
incentive plan.
The Court will convene a hearing on the 2007 Executive Incentive
Plan on Jan. 18, 2007, at 2:00 p.m.
Need for Adequate Incentive Program
As a result of the continued demands placed on senior management
and the recent resignations of their CEO Steve Richman and
another executive, the Debtors' board of directors has determined
that it is critical to implement an adequate incentive program
for senior managers and other executives who are able to directly
impact the Debtors' performance, business initiatives and course
of restructuring.
According to Robert S. Brady, Esq., at Young, Conaway, Stargatt &
Taylor, LLP, in Wilmington, Delaware, the executives must have
been recommended by the CEO and approved by the Board, or been
approved previously for participation in the Debtors' Business
Optimization Bonus Plan, to participate in the Executive
Incentive Plan. The EIP replaces the BOB Plan adopted in January
2006.
The EIP provides that the 2007 base salaries of the executives,
excluding the CEO and president, will not be increased by more
than 25% of their 2006 base salary. The 2007 base salary of the
Debtor's president will not be increased by more than 40% of his
2006 base salary.
There are two components of the EIP - the Incentive Payments and
the Non-Complete Agreement.
Executives are eligible to earn incentive payments tied to
operating performance based on earnings before interest, taxes,
depreciation, amortization and reorganization related expenses
(EBITDA), which is measured quarterly starting in the fourth
quarter of 2006 through the fourth quarter of 2007.
If the Debtors' performance in each quarter exceeds by 110% the
projected EBITDA set forth in the revised 2006 budget forecast or
the 2007 budget to be delivered to the DIP Lenders in the near
term, each Executive is eligible to earn up to 20% of his
applicable annual base salary per quarter -- his target bonus.
To the extent the Debtors' performance is between 100% and 110%
of the applicable budget, each Executive would receive 90% of the
Target Bonus. And if the Debtors' performance is equal to or
greater than 80% but less than 100% of the applicable budget,
each Executive would receive 70% of the Target Bonus.
To protect the Debtors from competition from the Executives and
to avoid litigation regarding the enforceability of prepetition
employment agreements, within 30 days of the Court's approval of
the EIP, each Executive identified by the CEO as either Level A
or Level B employee has the option to execute a non-compete
agreement.
The Executive may execute a Non-Compete Agreement for a term of
12 months from the earlier of (i) confirmation of the Debtors'
Chapter 11 Plan, (ii) Court approval of the sale of the Debtors'
assets, and (iii) and termination of the Executive's employment.
In consideration of the Executive's execution of the Non-Compete
Agreement, which the Debtors could assign to a buyer, the
Executive is entitled to a lump sum payment payable upon the
earlier of the date the Court (a) confirms the Debtors' Plan that
addresses substantially all of the Debtors' assets, and (b)
approves a sale of all of the Debtors' assets.
Level A Employees will have a Non-Compete Payment of $150,000,
while Level B Employees will have a Non-Compete Payment of
$100,000. If the Debtors do not emerge from bankruptcy by June
30, 2007, the applicable Non-Compete Payments of the Executives
will be decreased by 50%.
Fifty percent of the actual Bonus earned by an Executive in a
given quarter will be paid 45 days after the end of the quarter
or as soon as reasonably practicable. The 50% portion of each
Bonus earned but not paid will be payable upon the earlier of
March 31, 2008, or the termination without cause of the
Executive.
Mr. Brady notes that the lenders under the first lien credit
agreement dated June 11, 2003, and the second lien credit
agreement dated May 10, 2005, have agreed to "carve out" of their
collateral and superiority claims the amount of any Incentive
Payment or Non-Complete Payment earned but not yet paid with
respect to the Executives. He says that the amounts will not
reduce any "carve outs" provided for in the Debtors' Chapter 11
cases.
The Debtors anticipate that there will be seven participants in
the EIP. Mr. Brady says that under the EIP, an Executive can
earn an equivalent of his annual base salary in Incentive
Payments. And assuming that the Debtors achieve 100% of each
target and that each Level A and Level B Employee elects to enter
into a Non-Compete Agreement, the EIP will have a total cost of
about $2,632,000.
According to Mr. Brady, the cost of the EIP is not only
reasonable and in the best interest of the estates, it is
reasonably modest when compared to the degradation in enterprise
value that is likely to occur if the Debtors cannot properly
incentivize the Executives.
The Debtors believe that the EIP is the most effective and cost-
efficient means of retaining and motivating the Executives while
achieving the best possible outcome for their stakeholders.
Based in Greenville, Pennsylvania, Werner Holding Co. (DE) Inc.
aka Werner Ladder Co. -- http://www.wernerladder.com/--
manufactures and distributes ladders, climbing equipment and
ladder accessories. The company and three of its affiliates filed
for chapter 11 protection on June 12, 2006 (Bankr. D. Del. Case
No. 06-10578). The Debtors are represented by the firm of Willkie
Farr & Gallagher LLP as lead counsel and the firm of Young,
Conaway, Stargatt & Taylor LLP as co-counsel. Rothschild Inc. is
the Debtors' financial advisor. The Official Committee of
Unsecured Creditors is represented by the firm of Winston & Strawn
LLP as lead counsel and the firm of Greenberg Traurig LLP as co-
counsel. Jefferies & Company serves as the Creditor Committee's
financial advisor. At March 31, 2006, the Debtors reported total
assets of $201,042,000 and total debts of $473,447,000. The
Debtors's exclusive period to file a plan expires on Jan. 15,
2007. (Werner Ladder Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service Inc. http://bankrupt.com/newsstand/or
215/945-7000)
WERNER LADDER: Court OKs Implementation of Employee Severance Plan
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Werner Holding Co. (DE), Inc., aka Werner Ladder Company, and
its debtor-affiliates authority to implement a severance plan for
hourly union employees at their facility in Chicago, Illinois,
who will permanently lose their jobs.
In 2005, the Debtors decided to transfer their operations from
the relatively high cost Chicago Facility to their facility in
Juarez, Mexico. At the end of the transition, the Chicago
Facility will be closed and substantially all of the employees
will be terminated. The Debtors anticipate their operational
restructuring to be completed in the first quarter of 2007.
Currently, there are about 432 hourly employees at the Chicago
Facility, of which 429 are members of the Allied Production
Workers Union Local No. 12, AFL, CIO. To insure the continued
productivity at the Chicago Facility, the Debtors and the Chicago
Union had entered into a new collective bargaining agreement to
replace their original CBA that expired on July 17, 2006. The
new CBA took effect on July 18, 2006.
The Troubled Company Reporter on Nov. 27, 2006, relates that Joel
A. Waite, Esq., at Young, Conaway, Stargatt & Taylor, LLP, in
Wilmington, Delaware, told the Court that neither the Original CBA
nor the Current CBA provided the Chicago Union Employees with a
contractual right to severance payments.
Mr. Waite said that pursuant to a Final Settlement and
Recommendation dated Aug. 8, 2006, between the Debtors and the
Chicago Union, the Debtors agreed that in the event of a notice
of mass layoff or plant shutdown under the Worker Adjustment and
Retraining Act of 1998, they would negotiate to implement a
severance program for the Chicago Union Employees.
In September 2006, the Debtors notified their employees at the
Chicago Facility of their intention to cut up to 230 jobs by
November. In October 2006, the Debtors sent another notice
indicating their intention to eliminate up to 100 additional
employees beginning Dec. 17, 2006.
Chicago Union Employee Severance Program
Under the Chicago Union Employee Severance Program, as negotiated
by the parties, calculation of the severance payments due at the
time of separation would be done by multiplying the number of
completed years of service by the appropriate severance
multiplier.
Years of Service Severance Multiplier
---------------- --------------------
<2 $0
2-4 $75
5-7 $75
8-14 $100
15-24 $135
> or = 25 $175
According to Mr. Waite, the total maximum cost of the Chicago
Severance Program would be around $751,240 for the 429 Chicago
Union Employees.
Mr. Waite noted that the Chicago Union Employees are a critical
part of the operational restructuring that is currently underway,
and the most effective way to incentivize them to continue
working for the Debtors is to provide the Severance Payments upon
their termination.
The Debtors also believe that making the Severance Payments to
the employees who will lose their jobs in the near future is
necessary to sustain the morale of the remaining employees who
otherwise might leave during the critical stage of the Debtors'
bankruptcy cases.
Based in Greenville, Pennsylvania, Werner Holding Co. (DE) Inc.
aka Werner Ladder Co. -- http://www.wernerladder.com/--
manufactures and distributes ladders, climbing equipment and
ladder accessories. The company and three of its affiliates filed
for chapter 11 protection on June 12, 2006 (Bankr. D. Del. Case
No. 06-10578). The Debtors are represented by the firm of Willkie
Farr & Gallagher LLP as lead counsel and the firm of Young,
Conaway, Stargatt & Taylor LLP as co-counsel. Rothschild Inc. is
the Debtors' financial advisor. The Official Committee of
Unsecured Creditors is represented by the firm of Winston & Strawn
LLP as lead counsel and the firm of Greenberg Traurig LLP as co-
counsel. Jefferies & Company serves as the Creditor Committee's
financial advisor. At March 31, 2006, the Debtors reported total
assets of $201,042,000 and total debts of $473,447,000. The
Debtors's exclusive period to file a plan expires on Jan. 15,
2007. (Werner Ladder Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service Inc. http://bankrupt.com/newsstand/or
215/945-7000)
WII COMPONENTS: S&P Affirms 'B' Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on St.
Cloud, Minnesota-based WII Components Inc. to negative from
stable.
The company's 'B' corporate credit rating was affirmed.
"The outlook revision reflects the meaningful expected increase in
WII's debt leverage in connection with Olympus Partners' planned
$296 million acquisition of the company amid the housing
downturn," said Standard & Poor's credit analyst Lisa Tilis.
Standard & Poor's have concerns about the duration and severity
of the downturn in residential new construction as well as
continued uncertainty regarding the impact of the slowdown on
remodeling demand. WII began to experience softer earnings in the
third quarter of 2006. If housing markets do not begin to recover
in the second half of 2007, the company's cash flow could
become negative and credit measures could be weaker than expected
for the ratings.
Debt at Sept. 30, 2006, was $130 million.
WII makes solid and engineered wood components for kitchen and
bathroom cabinets, producing primarily solid hardwood cabinet
doors and door components, face frames, and drawer fronts.
"We could lower the ratings if market conditions worsen more than
expected or OEM in-sourcing squeezes earnings and cash flow,"
Ms. Tilis said.
"Alternatively, we could revise the outlook to stable if the
company can generate consistent margins and positive free cash
flow despite a more aggressive capital structure and the market
challenges ahead."
* AlixPartners Promotes 12 New Managing Directors
-------------------------------------------------
AlixPartners has announced the promotions of 12 new managing
directors effective Jan. 1, 2007:
-- Laura Barlow (London),
-- John Castellano (Chicago),
-- Charles Cipione (Dallas),
-- Foster Finley (New York),
-- Barry Folse (Dallas),
-- Andrew Grantham (London),
-- David Hutchinson (London),
-- Doug Jung (New York),
-- Stephen Maurer (Chicago),
-- Stefan Ohl (Munich),
-- Laurent Petizon (Paris), and
-- Detlev Schauwecker (Dusseldorf).
"We are pleased to recognize the superb client service and
leadership capabilities of our new managing directors,"
AlixPartners chief executive officer Michael Grindfors said.
"The promotion of these highly-respected professionals is in
response to the growing demand for the hands-on, consensual
approach that is the hallmark of AlixPartners and which
drives our clients' success."
Ms. Barlow, who is based in London, joined AlixPartners in May
2003 from an interim management role at Marconi plc, where she led
global liquidity initiatives in support of its restructuring. She
was previously a Director in the Corporate Finance and
Restructuring practices at Arthur Andersen.
Ms. Barlow has more than 15 years of experience working with
companies that face significant operational and financial
challenges. She has held interim management and advisory roles,
developing and implementing crisis stabilization, turnaround and
operational improvement plans for public and private companies.
Her experience includes serving as joint Chief Restructuring
Officer at Stolt Offshore SA, a global offshore oil services
business that completed an $844 million restructuring of its debt
and other facilities. She is a graduate of Oxford University, a
Chartered Accountant, and SFA Securities Representative. She is
the co-author of Leading Corporate Turnaround, and a guest
lecturer for the MBA program at London Business School.
Based in Chicago, Mr. Castellano brings a unique set of skills to
AlixPartners from both his experience as a Manager in Strategic
Advisory Services at Ernst & Young and as a Corporate
Budgeting/Planning and Product/Cost Manager for the Sweetheart Cup
Company, Inc.
Since joining the firm in June 1998, he has been an integral part
of such engagements as ANC, Mirant, New World Pasta, Peregrine,
and his current assignment at Calpine Corporation. He specializes
in designing and implementing business turnarounds and providing
crisis interim management, but he also has a strong background in
strategic restructuring and hands-on implementation.
He was graduated from DePaul University with a B.S. degree in
commerce and accounting, and earned his MBA from the Kellogg
School of Management at Northwestern University, with an
emphasis in finance and strategic management. He is also a CPA.
Mr. Cipione joined AlixPartners in April 2001 and is based in the
firm's Dallas office. He has more than 15 years of experience in
designing and implementing technology solutions focused on solving
financial, operational, and litigation problems. He is currently
focusing on implementing litigation technology strategies for
corporate clients.
Mr. Cipione designed a variety of technology solutions for clients
involved in regulatory investigations and litigations. These
solutions include custom-designed, complex data analytics and
reporting, as well as a full suite of electronic discovery
solutions. He has also helped companies such as WorldCom, Kmart,
and Fleming with various aspects of their restructurings.
His career began with Arthur Andersen, and he later formed his own
consulting company, specializing in software development to solve
complex analytical and reporting problems. He received his
bachelor's degree in chemistry and his MBA degree from Texas A&M
University.
Mr. Finley joined AlixPartners' New York office in October 2004.
He has over 20 years of industry and consulting experience.
Before joining the firm, he was a Vice President in the Operations
Service practice with A.T. Kearney, where he co-led their global
supply chain offering. He has a successful track record of
executing high-impact, complex projects and delivering
results for operation-intensive clients. His distinctive
competencies include supply chain strategy, asset effectiveness,
logistics management, and inventory optimization.
Before management consulting, Mr. Finley ran manufacturing
operations for Rockwell Automation in Milwaukee. He holds a
Bachelor of Mechanical Engineering degree from the Georgia
Institute of Technology, and an MBA from Marquette University in
Milwaukee. He is a licensed Professional Engineer and a Certified
Production and Inventory Manager. He is also a member of the
Council of Supply Chain Management Professionals.
Mr. Folse joined the Dallas office of AlixPartners in May 2001.
He is an experienced information technology professional with
expertise in workflow analysis, the redesign and consolidation of
business processes, and the negotiation and resolution of complex
business disputes. He is currently focused on maneuvering large
clients through the Chapter 11 reorganization process. He also
provides testimony and other support for a variety of bankruptcy
issues. His key clients include Cable & Wireless, Calpine
Corporation, Exide, Fleming, Genuity, and Sunterra.
Before joining AlixPartners, he worked for 14 years at DFMC
Corporation, where he was an Executive Vice President/COO/CTO. He
began his career as a programmer/analyst for Trinity Industries,
Inc. Mr. Folse earned a bachelor's degree in business
administration with concentrations in statistical methods and
computer science from Louisiana State University.
Mr. Grantham has been a member of the London office of
AlixPartners since joining in November 2005. He is a financial
expert with more than 15 years of experience as a forensic
accountant and expert witness in valuation, breach of contract and
loss of profits, acquisitions and disposals, minority shareholder
and joint venture disputes, matrimonial disputes and post-
acquisition disputes. He has testified in court and other
tribunals in the UK and in international arbitrations in
connection with significant commercial disputes.
Before joining AlixPartners, he was a director in the Forensic
Department of KPMG and led their Engineering & Construction team.
Previously, he was in the Disputes Analysis & Investigations team
with PricewaterhouseCoopers.
He graduated with honors with a BSC degree in mathematics from
Nottingham University, and is a Fellow of the Institute of
Chartered Accountants in England and Wales as well as a Governor
and the Assistant Treasurer of the Expert Witness Institute.
Before joining the firm's London office in October 2004, Mr.
Hutchinson was with A.T. Kearney and before that Coopers & Lybrand
leading manufacturing and supply chain improvement projects for
global clients. He also served as an Operations Manager for
Phillips Imperial Petroleum and ICI Chemicals & Polymers. He has
over 20 years of industry and consulting experience in operations
management across a range of industry sectors including specialty
chemicals, food and FMCG products, packaging, construction,
pharmaceuticals, refining and petrochemicals.
He obtained a master's degree in engineering science from Oxford
University and is a member of the Institute of Mechanical
Engineers. He has also previously served as a member of the
Operations Excellence Board of global chemicals company, ICI.
Mr. Jung joined the New York office in November 2005. He
possesses a diverse background in investigations due diligence,
audit, finance, and credit with more than 25 years of experience
in various industries such as consumer goods, retail,
distribution, aerospace, heavy manufacturing, telecom,
agriculture, textile and apparel, energy, finance companies, and
healthcare.
He has conducted a variety of financial investigations, reviews of
business operations, and analyses of complex structured
financings. Before joining AlixPartners, he was with JPMorgan as
COO for Chase Business Credit, where he built and managed a
specialized due diligence and asset-based banking group within the
Investment Bank and Credit organizations, providing structuring,
due diligence, asset valuation, and advisory services for
leveraged or distressed clients. He is a CPA and holds a
bachelor's degree in accounting from Syracuse University.
Based in Chicago, Mr. Maurer joined AlixPartners in March 2005.
He is recognized as a subject matter expert in manufacturing, and
has expertise in operations improvement, product development, and
supply chain management across a range of industries including
automotive, manufacturing and food processing.
Before joining AlixPartners, he was a Principal with A.T.
Kearney, where he led the Innovation & Product Development
practice for North America. He has also held positions with the
consulting group George Group, Inc. and Lockheed Martin Tactical
Aircraft Systems. He holds a bachelor's degree and master's
degree in mechanical engineering from the University of Iowa and
an MBA from the College of William and Mary.
Mr. Ohl joined AlixPartners' Munich office in May 2004. With more
than 13 years of global business experience, he provides hands-on
operational consulting to the automotive, assembly, and high-tech
industries. His expertise includes efficiency improvement and
cost management, as well as product development, purchasing, and
supply chain management.
Before joining AlixPartners, he was an Associate Principal with
McKinsey & Co. in Hamburg, Cleveland, and Detroit, where he co-led
its Automotive & Assembly and Operations Effectiveness practices.
Prior to that, he worked with DaimlerChrysler. He also co-founded
the McKinsey cost management initiative and invented the
"Integrated Cost Reduction" approach for reducing and
managing total product cost. He holds a Master of Economic
Engineering degree from the University of Karlsruhe, Germany, and
earned his PhD in "Planning and Forecasting in the Automotive
Industry."
Mr. Petizon was a founding member of the firm's Paris office when
he joined in January 2006, and his ability to manage complex
assignments has helped establish a strong AlixPartners presence in
Paris. He has 15 years of experience in strategy and
organization, research and development, strategic sourcing, and
post-merger integration in industries such as automotive,
assembly, and utilities.
Before joining AlixPartners, he was with A.T. Kearney where he
worked in the firm's Paris, New York, and Detroit offices. While
at A.T. Kearney, he was in charge of the Automotive and Assembly
practice for Southwest Europe. Before that, he worked at ThalSs,
the French electronics defense group. Petizon holds an MSc degree
in electrical engineering and an MBA from HEC Business School in
Paris.
Mr. Schauwecker joined the Dsseldorf office of AlixPartners in
March 2005. His experience includes operational and financial
restructuring, cost management, business planning, liquidity
planning, project management and implementation. He has worked in
a wide array of industries, including information technology,
media, consumer goods, construction and real estate management,
and he has served in a variety of interim roles, such as Chief
Restructuring Officer and Chief Financial Officer.
Before joining AlixPartners, he was a partner with Roland Berger
in Munich. Before that, he was with Kraft Jacobs Suchard (Phillip
Morris Group), serving in a variety of marketing and sales
positions with increasing responsibility. Mr. Schauwecker studied
economics at Westfalische Wilhelms Universitat Munster, and there
he received his Diplom-Kaufmann in marketing.
The firm also announced these promotions to director:
-- In Chicago, Jim Bienias, Andrea Gonzales, Mark Hojnacki, and
Scott Matrenec;
-- In Dallas, Joel Bines, Kyle Braden, John Franks, Brad
Hunter, Robb McWilliams, and Brent Robison;
-- In London, Gary Davies, David Hewish, and Nnenna Ilomechina;
-- In Los Angeles, Trevor Sturges;
-- In Milan, Giacomo Cantu, Dario Duse, Francesco Leone, and
Michele Mauri;
-- In Munich, Jens Haas and Michael Tyroller;
-- In New York, Stacey Hightower, Michael Porter, and Anish
Sheth; and
-- In Southfield, Michigan, Adam Fless, Drew Kendall, Bill
Kocovski, Chris Payne, and Dan Ritter.
About AlixPartners
AlixPartners -- http://www.alixpartners.com/-- is a global
performance improvement, corporate turnaround, and financial
advisory services firm. The AlixPartners' "one-stop-shop" suite
of services range from operational performance improvement and
financial restructuring across all major corporate disciplines
(manufacturing, supply chain, IT, sales and marketing, etc.), to
financial advisory services (including financial reporting,
corporate governance and investigations) to technology-enabled
restructuring and claims management. Headquartered in Southfield,
Michigan, the firm has more than 500 employees, and has offices in
Chicago, Dallas, Detroit, Dsseldorf, London, Los Angeles, Milan,
Munich, New York, Paris, San Francisco and Tokyo.
* Baird Opens New Corporate Restructuring Investment Banking Group
------------------------------------------------------------------
Baird has launched a new Corporate Restructuring Investment
Banking group to provide equity and debt financing and M&A
advisory services to financially distressed companies as they seek
to reorganize.
William G. Welnhofer, formerly a principal at the Chicago-based
investment-banking firm Starshak Welnhofer & Co., has joined the
firm as Managing Director to lead the new effort.
"The addition of the Corporate Restructuring group positions Baird
to provide financial guidance to our clients throughout the
economic cycle," said Steven G. Booth, head of investment banking
for the firm. "Bill and his team bring a long history of
successfully guiding companies through the challenges and
complexities of restructuring which will add terrific value to the
firm and our clients."
"As one of the country's leading middle market investment banking
firms, Baird has terrific resources, an outstanding reputation,
and a fantastic presence across all its markets," Mr. Welnhofer
said.
"Though reorganizations can be challenging, they are also a great
opportunity to add value for clients. I look forward to working
with the team here to help grow the firm's corporate restructuring
capabilities."
Before joining Baird, Mr. Welnhofer spent nearly 17 years with
Starshak Welnhofer, where he managed the bankruptcy
reorganizations of companies like AstroTurf Industries, Inc.,
London Fog Industries, and Dairy Mart Convenience Stores that
collectively involved the sale of numerous businesses and the
restructuring of billions of dollars of debt. Before founding the
firm, Mr. Welnhofer was a partner in the Chicago law firm McBride,
Baker & Coles.
Mr. Welnhofer holds a B.A. in economics, an M.B.A., and a J.D.
degree, all from Northwestern University. He has been a member of
the Illinois Bar since 1980.
About Baird
Baird is an international investment bank focused on the middle
market. More than 100 investment banking professionals in the
U.S. and Europe provide corporations with in-depth market
knowledge and extensive experience in merger and acquisition and
equity financing transactions. Over the past 10 years, Baird has
advised on 380 M&A transactions totaling approximately
$50 billion, with more than 20 % of M&A activity involving cross-
boarder transactions, and has served as lead or co-manager on
approximately 250 equity offerings totaling $34 billion.
Baird is an employee-owned, international wealth management,
capital markets, private equity and asset management firm with
offices in the United States, Europe, and Asia.
Established in 1919, Baird has more than 2,200 associates serving
the needs of individual, corporate, institutional and municipal
clients. Baird oversees and manages client assets of nearly
$70 billion. Baird was recognized as one of FORTUNE magazine's
"100 Best Companies to Work For" in 2004, 2005, 2006, and 2007.
Baird's principal operating subsidiaries are Robert W. Baird & Co.
in the United States and Robert W. Baird Group Ltd. in Europe.
Baird also has an operating subsidiary in Asia supporting Baird's
private equity operations.
Robert W. Baird & Co. is a member of the New York Stock Exchange
and other principal exchanges and the Securities Investor
Protection Corporation. Robert W. Baird Ltd. and Baird Capital
Partners Europe Ltd. are authorized and regulated in the United
Kingdom by the Financial Services Authority.
* Edward Weisfelner Named 2006 Outstanding Restructuring Lawyer
---------------------------------------------------------------
Brown Rudnick Berlack Israels LLP has announced that Edward S.
Weisfelner, Esq., Chair of the firm's Bankruptcy and Corporate
Restructuring Practice Group, has been named to the 2006 list of
Outstanding Restructuring Lawyers by Turnarounds & Workouts.
Recognized for his individual achievements in bankruptcy and
corporate restructuring, Mr. Weisfelner is one of only 12
attorneys in the country to be selected for this prestigious list.
He is also a three-time recipient of this award.
Mr. Weisfelner has extensive experience representing official and
unofficial creditors' and equity holders' committees, individual
creditors, indenture trustees, equity holders, and other parties
in in-court and out-of-court restructurings. He also represents
buyers of assets and claims in Chapter 11 proceedings and has
served as a court appointed mediator and examiner. He is a member
of the American Bankruptcy Institute, the New York and American
Bar Associations, and the Turnaround Management Association.
In 2005/2006, Mr. Weisfelner was involved in, among others, the
following high-profile matters:
-- Mirant Corporation: led a team of Brown Rudnick lawyers in
the representation of the Official Equity Committee,
overcoming an estimated $2 billion alleged shortfall in
creditor recoveries to deliver equity and warrants with an
estimated market value of over $750 million. The stock has
traded up over 26% since it first began trading after
emergence.
-- Adelphia Communications: represents Ad Hoc Committees of
Trade Creditors at both the operating and holding company
levels of the capital structure. Successfully negotiated
for 8% postpetition interest for operating trade creditors
who are the only operating company creditors to have
earned back the entire amount of give-backs to the holding
company creditors in support of consensual plan.
-- Metaldyne Corporation: represents the Ad Hoc Committee of
Subordinated Noteholders in connection with the proposed
$1.2 billion merger with Asahi Tec Corporation.
-- Owens Corning: represents the Ad Hoc Committee of Security
Holders, comprised of institutions that hold a large
percentages of Owens Corning preferred and common equity.
-- GB Holdings: represents affiliates of Carl Icahn in
Chapter 11 proceedings concerning the Sands Hotel and
Casino in Atlantic City.
-- Congoleum Corporation: represents the Ad Hoc Committee of
Noteholders contesting confirmation of Debtors'
10th modified plan of reorganization.
-- US Gypsum: represents the Ad Hoc Committee of Trade
Creditors, comprised of institutions that hold a significant
percentage of the debtors' outstanding trade debt and that
oppose the debtors' proposed plan of reorganization.
-- Global Power Equipment Group: represents the Official
Committee of Equity Security Holders in this Delaware
Chapter 11 case. Global Power Equipment Group provides
power generation equipment for customers in the domestic and
international energy and power infrastructure industries.
The company employs more than 3,000 individuals world wide,
and lists assets exceeding $300 million and liabilities
exceeding $250 million.
-- Le-Nature's, Inc.: represents the Ad Hoc Committee
comprised of institutions holding the vast majority of
senior secured bank debt owed by The Le-Nature's. The
company's bankruptcy case is pending in Pittsburgh.
Published by the Beard Group Inc., Turnarounds & Workouts is a
newsletter dedicated to tracking distressed businesses in the
United States and Canada.
About Brown Rudnick Berlack Israels LLP
Brown Rudnick Berlack Israels LLP -- http://www.brownrudnick.com/
-- is a full-service, international law firm with offices in the
United States and Europe. The firm's attorneys provide
representation across key areas of the law: Bankruptcy & Finance,
Corporate & Securities, Real Estate, Intellectual Property,
Complex Litigation, Government Law & Strategies, Energy, and
Health Care.
The Brown Rudnick Center for the Public Interest --
http://www.brownrudnickcenter.com/-- is a measure of the Firm's
strong commitment to the community and serves as an umbrella
entity encompassing the Firm's pro bono legal work, charitable
giving, community involvement and public interest efforts.
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
-------------------------------------------------------------
Recent chapter 11 cases filed with assets and liabilities below
$1,000,000:
In re 106 Abby Oak, Inc.
Bankr. S.D. Miss. Case No. 06-02917
Chapter 11 Petition filed December 20, 2006
See http://bankrupt.com/misc/mssb06-02917.pdf
In re 2519 Terry Road, Inc.
Bankr. S.D. Miss. Case No. 06-02918
Chapter 11 Petition filed December 20, 2006
See http://bankrupt.com/misc/mssb06-02918.pdf
In re Sang K. Chon
Bankr. N.D. Ga. Case No. 06-76504
Chapter 11 Petition filed December 20, 2006
See http://bankrupt.com/misc/ganb06-76504.pdf
In re Priority Communications Ministries, Inc.
Bankr. D. Del. Case No. 06-11467
Chapter 11 Petition filed December 21, 2006
See http://bankrupt.com/misc/deb06-11467.pdf
In re Grant Avenue Textiles, LLC
Bankr. E.D. Pa. Case No. 06-16061
Chapter 11 Petition filed December 22, 2006
See http://bankrupt.com/misc/paeb06-16061.pdf
In re Kidcare Pediatrics, LLC
Bankr. N.D. Ga. Case No. 06-76674
Chapter 11 Petition filed December 22, 2006
See http://bankrupt.com/misc/ganb06-76674.pdf
In re Lacey's Pub & Grill, Inc.
Bankr. E.D. Pa. Case No. 06-16059
Chapter 11 Petition filed December 22, 2006
See http://bankrupt.com/misc/paeb06-16059.pdf
In re Norman Iain MacDonald
Bankr. D. S.C. Case No. 06-05973
Chapter 11 Petition filed December 27, 2006
See http://bankrupt.com/misc/scb06-05973.pdf
In re Unique Management, LLC
Bankr. D. Md. Case No. 06-18478
Chapter 11 Petition filed December 27, 2006
See http://bankrupt.com/misc/mdb06-18478.pdf
In re The Airporter, Inc.
Bankr. D. Mass. Case No. 06-15023
Chapter 11 Petition filed December 28, 2006
See http://bankrupt.com/misc/mab06-15023.pdf
In re Russell NMN Brown
Bankr. D. S.C. Case No. 06-06051
Chapter 11 Petition filed December 29, 2006
See http://bankrupt.com/misc/scb06-06051.pdf
In re The Lissiak Company, Inc.
Bankr. N.D. Tex. Case No. 06-35784
Chapter 11 Petition filed December 29, 2006
See http://bankrupt.com/misc/txnb06-35784.pdf
In re KP23, LLC
Bankr. M.D. Fla. Case No. 07-00016
Chapter 11 Petition filed January 2, 2007
See http://bankrupt.com/misc/flmb07-00016.pdf
In re KP23 Enterprises, Inc.
Bankr. M.D. Fla. Case No. 07-00015
Chapter 11 Petition filed January 2, 2007
See http://bankrupt.com/misc/flmb07-00015.pdf
In re KP26, LLC
Bankr. M.D. Fla. Case No. 07-00017
Chapter 11 Petition filed January 2, 2007
See http://bankrupt.com/misc/flmb07-00017.pdf
In re A.T. Security Services, Inc.
Bankr. M.D. Pa. Case No. 07-00014
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/pamb07-00014.pdf
In re Glen Eugene Stanley
Bankr. S.D. W.V. Case No. 07-30001
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/wvsb07-30001.pdf
In re Pineview Hospice, LLC
Bankr. N.D. Ala. Case No. 07-70007
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/alnb07-70007.pdf
In re Premium Recharge, Inc.
Bankr. D. Ariz. Case No. 07-00021
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/azb07-00021.pdf
In re Tougher Mechanical, Inc.
Bankr. N.D. N.Y. Case No. 07-10022
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/nynb07-10022.pdf
In re Wreck Tech, Inc.
Bankr. N.D. Ala. Case No. 07-80022
Chapter 11 Petition filed January 3, 2007
See http://bankrupt.com/misc/alnb07-80022.pdf
In re Kirkland Boats, Inc.
Bankr. N.D. Miss. Case No. 07-10037
Chapter 11 Petition filed January 4, 2007
See http://bankrupt.com/misc/msnb07-10037.pdf
In re Bill's Auto & Truck Repair, Inc.
Bankr. D. Md. Case No. 07-10165
Chapter 11 Petition filed January 5, 2007
See http://bankrupt.com/misc/mdb07-10165.pdf
In re Eric C. Smith
Bankr. D. Ariz. Case No. 07-00056
Chapter 11 Petition filed January 5, 2007
See http://bankrupt.com/misc/azb07-00056.pdf
In re Lodge of Ozarks Management, Inc.
Bankr. W.D. Mo. Case No. 07-60016
Chapter 11 Petition filed January 5, 2007
See http://bankrupt.com/misc/mowb07-60016.pdf
In re Scott F. Cunningham
Bankr. E.D. Tex. Case No. 07-40039
Chapter 11 Petition filed January 5, 2007
See http://bankrupt.com/misc/txeb07-40039.pdf
In re Thomas Renfroe Elliott, Jr.
Bankr. N.D. Ala. Case No. 07-00091
Chapter 11 Petition filed January 5, 2007
See http://bankrupt.com/misc/alnb07-00091.pdf
In re Twenty Six Sixteen Main Street, Inc.
Bankr. W.D. N.Y. Case No. 07-00082
Chapter 11 Petition filed January 6, 2007
See http://bankrupt.com/misc/nywb07-00082.pdf
In re J.G.G. Enterprises, Inc.
Bankr. D. Md. Case No. 07-10186
Chapter 11 Petition filed January 7, 2007
See http://bankrupt.com/misc/mdb07-10186.pdf
In re McGinley Square, LLC
Bankr. D. N.J. Case No. 07-10283
Chapter 11 Petition filed January 8, 2007
See http://bankrupt.com/misc/njb07-10283.pdf
In re Sandpiper Resorts Development Corporation
Bankr. D. Ariz. Case No. 07-00008
Chapter 11 Petition filed January 8, 2007
See http://bankrupt.com/misc/azb07-00008.pdf
*********
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, Shimero Jainga, Joel Anthony G.
Lopez, Robert Max Quiblat, Emi Rose S.R. Parcon, Rizande B. Delos
Santos, Cherry A. Soriano-Baaclo, Christian Q. Salta, 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 ***