/raid1/www/Hosts/bankrupt/TCR_Public/090107.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, January 7, 2009, Vol. 13, No. 6
Headlines
AGAINST ALL ODDS: Files for Chapter 11 Protection
AGAINST ALL: Case Summary & Four Largest Unsecured Creditors
ALCOA INC: Reduces 18% of Output; Removes 13% of Workforce
AMERICAN AIRLINES: Bank Loan Sells at Substantial Discount
AMERICAN INT'L: Ex-CEO Wants Explanation on HSB Sale to Munich Re
AMERICAN INTL: Rescinds Ex-CEO Willumstad Restricted Share Award
ARCHWAY COOKIES: Owes Ashland Businesses Almost $1 Million
ATP OIL & GAS: Bank Loan Sells at Substantial Discount
BASELINE OIL: Posts $35MM Net Loss in Quarter Ended Sept. 30
BELL MICROPRODUCTS: Completes Restatement of Financial Reports
BERNARD L. MADOFF: Prosecutors Want Founder Imprisoned
BLOCKBUSTER INC: Bank Loan Sells at 41% Discount
BRTC INVESTMENTS: Case Summary & Six Largest Unsecured Creditors
BRUNSWICK CORP: to Mothball Riverview Boat Plant Amid Slow Demand
BRUNSWICK CORP: To Make More Staff, Production & Expense Cuts
BRUNSWICK CORP: Moody's Confirms 'B2' Corporate Family Rating
CAPITAL AUTOMOTIVE: Bank Loan Sells at 62% Discount
CARDINAL COMMUNICATIONS: Voluntary Chapter 11 Case Summary
CC MEDIA: Clear Channel Bank Loan Sells at Substantial Discount
CHEMTURA CORP: Lenders Relax Financial Covenants for 90 Days
CHESAPEAKE CORP: Mulls Feb. 24 Auction; Irving/Oaktree Lead Bidder
CHESAPEAKE CORP: Court Sets March 30 as Claims Bar Date
CHESAPEAKE CORP: U.S. Trustee Forms Seven-Member Creditor Panel
CHRISTOPHER TAYLOR: Case Summary & 20 Largest Unsecured Creditors
CLEAR CHANNEL: Bank Loan Sells at Substantial Discount
CONSTAR INTL: Court OKs $75MM DIP Loan, Other "First Day" Motions
CONSTAR INTL: Receives Delisting Notice from NASDAQ
DHP HOLDINGS: Organizational Meeting to Form Panel on January 9
DREIER LLP: U.S. Trustee Picks Sheila Gowan as Chapter 11 Trustee
EAST CAMERON: Court Denies Heller as Attys. to Non-Debtor Unit
EAST CAMERON: Files Schedules of Assets and Liabilities
EAST CAMERON: U.S. Trustee Appoints 5-Member Creditors Committee
ELECTRICAL COMPONENTS: Moody's Downgrades Credit Ratings to 'Caa3'
EOS AIRLINES: Court Approves Adequacy of Disclosure Statement
FLAGSTAR BANK: Moody's Withdraws 'D+' Financial Strength Rating
GENERAL GROWTH: Settles Caruso Suit for $48-Mil.
GENERAL MOTORS: December Deliveries Down 31% from 2007 Levels
GLOBAL TEL*LINK: Moody's Affirms Corporate Family Rating at 'B2'
GOODY'S FAMILY: To Liquidate Stores; Seeks Bankruptcy Protection
GREATER OHIO ETHANOL: Seeks Mid-Jan. Auction, Inks NextGen Pact
GREY WOLF: Moody's Withdraws 'Ba3' Corporate Family Rating
HAWAIIAN TELCOM: Committee Opposes Bid to Use Cash Collateral
HIGH RIVER GOLD: In Talks with Lenders on Unit's Covenant Breach
HLMC REALTY: Case Summary & 20 Largest Unsecured Creditors
HRP MYRTLE: Delaware Court Approves Chapter 7 Conversion
INDYMAC BANK: FDIC to Sell Banking Operations to IMB
INTERSTATE BAKERIES: 400 Prepetition Union Claims Resolved
JD CAPITAL: Will Wind Down Hedge Fund After Losses in 2008
KAUPTHING BANK: Committee to Take Legal Action v. U.K. Govt
KP FASHION: Files for Chapter 7 Liquidation
LEINER HEALTH: Declares Chapter 11 Liquidation Plan Effective
LEVITT AND SONS: Court OKs Disc. Statement, Allows Voting on Plan
LITHIUM TECH: Files March 31 & June 30 Qtr. Financial Reports
LUMINENT MORTGAGE: Files Disclosure Statement & 1st Amended Plan
LYONDELL CHEMICAL: Files for Chapter 11, Secures $8-Bil. DIP Loan
LYONDELL CHEMICAL: Access Commits $750MM of $3.25B New Financing
LYONDELL CHEMICAL: Case Summary & 50 Largest Unsecured Creditors
LYONDELL CHEMICAL: Top 5 Creditors Holding Secured Claims
MERISANT WORLDWIDE: Moody's Downgrades Corporate Ratings to 'Ca'
MERRILL LYNCH: Completes Sale to Bank of America
MERRILL LYNCH: Robert McCann Leaves Brokerage Chief Post
MICHAEL VICK: Files Amended Reorganization Plan in Court
MICRON TECHNOLOGY: Moody's Withdraws 'B1' Ratings
NAVISTAR INTL: Files Amendments to 2008 Quarterly Reports
NAVISTAR INTL: October 31 Balance Sheet Upside Down by $1.4BB
NXTV INC: ORIX to Hold Public Auction of Collateral on Jan. 13
NXTV INC: Vogen to Hold Public Auction of Collateral on Jan. 13
ODYNE CORP: Runs Out of Options, to Wind Down Operations
PACIFIC LIFESTYLE: May Obtain DIP Loan of $1,700,000 from K. Wann
PARENT CO: Organizational Meeting to Form Panel on January 8
PLASTECH ENGINEERED: Declares Fifth Amended Plan Effective
PRB ENERGY: Court Approves Adequacy of Disclosure Statement
PRECISION DRILLING: Moody's Affirms, Not Assigns, Ba1 Rating
QUALITY HOME: To Seek Approval of Disc. Statement Jan. 23
RECYCLED PAPER: Can Use $10MM Credit Suisse Facility on Interim
RECYCLED PAPER: Proposes Feb. 16 Plan Confirmation Hearing
REDROLLER HOLDINGS: Wants Case Converted to Chapter 7 Proceeding
ROBERT MCLEAN: Will Receive $750,000 From Country Music
SECO AMERICAN: Case Summary & 20 Largest Unsecured Creditors
SECURUS TECHNOLOGIES: Moody's Downgrades Corp. Ratings to 'Caa2'
SEMGROUP LP: Red Apple to Submit Bankruptcy Plan This Month
SEMGROUP LP: Will Consider Restructuring Bid from Catsimatidis
SEQUOIA HILLS: Case Summary & 20 Largest Unsecured Creditors
SILVER STATE: Files Chapter 7 Petition in Nevada
SKINNY NUTRITIONAL: Posts $1.4MM Net Loss in Qtr. Ended Sept. 30
SLM HOLDINGS: Sept. 30 Balance Sheet Upside Down by $1,552,913
SUN-TIMES MEDIA: Resigning Directors Decide to Stay
SUNWEST MANAGEMENT: Chief Executive Files for Chapter 11
SUPERIOR AIR: Files for Chapter 11 Protection
SUPERIOR AIR: Seeks to Sell All Assets to Textron
TERMOEMCALI LEASING: Fitch Raises Rating on $153.7MM Notes to 'B-'
THORNBURG MORTGAGE: Issues 14,176,464 Shares to Counterparties
TRIBUNE CO: U.S. Trustee Appoints Wilmington to Creditors Panel
TRUMP ENTERTAINMENT: Has Until Jan. 21 to Pay Due on 8.5% Notes
TYSON FOODS: Dick Bond Resigns as President & CEO
US SHIPPING: Moody's Downgrades Corporate Family Rating to 'Ca'
UTSTARCOM INC: To Wind Down Korea BU and Cut 10% of Workforce
VISTEON CORPORATION: Board Elects President and CEO as Chairman
VISTEON CORPORATION: Withdraws Full-year 2008 Financial Guidance
WASHINGTON MUTUAL: Can Hire Robert Williams as President
WHITEHALL JEWELERS: Wants Plan Filing Period Extended to April 20
WINNET COMMUNICATIONS: Files for Chapter 11 Protection
* FTI Acquires Turnaround Management Services Firm CXO LLC
* Manufacturing Sector Fails to Grow for 5th Straight Month
* Non-manufacturing Sector Contracts in December
* Treasury Sends Report on TARP Use; Possible $4BB for GM in Feb.
* Upcoming Meetings, Conferences and Seminars
*********
AGAINST ALL ODDS: Files for Chapter 11 Protection
-------------------------------------------------
Dawn McCarty at Bloomberg News reports that Against All Odds USA
Inc. has filed for Chapter 11 bankruptcy protection in the U.S.
Bankruptcy Court for the District of New Jersey.
Court documents say that Against All Odds listed assets of less
than $50 million and debts of less than $50 million. According to
the documents, Against All Odds' 20 largest creditors without
collateral backing their claims are owed a total of
$10.6 million. Bloomberg relates that Wicked Fashions is listed
as the largest unsecured creditor, holding a $3.9 million claim.
Moonachie, New Jersey-based Against All Odds USA Inc. operates
more than 70 men's apparel stores from New York to California. It
sells clothing and accessories targeted at young men including
lines by Southpole, G Unit, Ecko Unlimited and Converse. It was
founded in 1995.
AGAINST ALL: Case Summary & Four Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Against All Odds USA, Inc.
30 Congress Dr.
Moonachie, NJ 07074
Tel: (201) 641-3700
Bankruptcy Case No.: 09-10117
Type of Business: The Debtor sells clothing apparel, shoes and
accessories.
See: http://www.aao-usa.com/
Chapter 11 Petition Date: January 5, 2009
Court: District of New Jersey (Newark)
Judge: Donald H. Steckroth
Debtor's Counsel: Dwight E. Yellen, Esq.
dyellen@ballonstoll.com
Michael James Sheppeard, Esq.
msheppeard@ballonstoll.com
Ballon, Stoll, Bader & Nadler PC
505 Main St.
Hackensack, NJ 07601
Tel: (201) 342-7808
Fax: (201) 488-5788
Estimated Assets: $10 million to $50 million
Estimated Debts: $10 million to $50 million
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wicked Fashions $3,884,588
222 Bridge Plaza South
Fort Lee, NJ 07024
The CIT Group/Commercial $2,092,289
Services Inc.
PO Box 1036
Charlotte, NC 28201-1036
New Era Cap Co. Inc. $660,217
PO Box 054
Buffalo, NY 14240
The Timberland Company $533,953
PO Box 92550
Chicago, IL 60675
The petition was signed by chief financial officer Hyun Jong Nam.
ALCOA INC: Reduces 18% of Output; Removes 13% of Workforce
----------------------------------------------------------
Alcoa Inc. detailed on Tuesday a series of specific actions to
conserve cash, reduce costs and strengthen the company's
competitiveness during the current economic downturn. The company
said the actions address additional production curtailments, cost
and procurement efficiencies, portfolio streamlining and reduction
of capital expenditures and other liquidity enhancements.
"These are extraordinary times, requiring speed and decisiveness
to address the current economic downturn, and flexibility and
foresight to be prepared for future uncertainties in our markets,"
said Klaus Kleinfeld, President and CEO of Alcoa Inc. "We are
taking a wide-ranging set of aggressive, but prudent, measures to
ensure that Alcoa maintains its competitive lead in today's
challenging markets while also emerging even stronger when the
economy recovers."
Production Curtailments
Further smelting reductions of more than 135,000 metric tons per
year (mtpy) will be implemented resulting in reduction of total
primary aluminum output by more than 750,000 mtpy, or 18% of
annualized output. Alumina production will also be reduced
accordingly across the global refining system to a total of 1.5
million mtpy in response to market conditions. Curtailments will
be fully implemented by the end of the first quarter 2009.
Cost and Procurement Efficiencies
Targeted reductions, curtailments and plant closures and
consolidations will reduce headcount by more than 13,500 employees
or 13% of the company's worldwide workforce by the end of 2009.
An additional 1,700 contractor positions also will be eliminated.
The company has also instituted a global salary and hiring freeze.
Accelerated procurement actions to address major input costs such
as energy, coke, caustic soda, and aluminum fluoride will provide
significant short term cash benefits. Initiatives to secure raw
materials from alternate suppliers globally are providing cost
advantages for several key inputs. The actions are expected to
yield savings of greater than 20% in each of the materials. Lower
market oil and gas prices also are having a positive impact.
Alcoa continued to make progress on its re-powering strategy and
has finalized and signed agreements to supply power through 2040
to three smelters in Quebec that will benefit approximately 25% of
the company's smelting production. Nearly 80% of the company's
capacity is now covered by re-powering agreements and self
generation through 2025 and the company is aggressively pursuing
other efforts across its portfolio.
Portfolio Streamlining
Alcoa and ORKLA ASA (Orkla) have agreed to exchange their stakes
in a Norwegian smelting partnership and a Swedish extrusion joint
venture to focus on their respective areas of expertise and best
practices. Alcoa will receive Orkla's 50% stake in Elkem Aluminum
and Orkla will receive Alcoa's 45% stake in the SAPA extrusion
profiles business.
Elkem Aluminum, which will be 100% owned by Alcoa following the
transaction, includes aluminum smelters in Lista and Mosjoen,
Norway with a combined output of 282,000 metric tons per year
(mtpy). Included in the transaction is Elkem's stake in a newly
opened anode plant in Mosjoen in which Alcoa already holds an
approximate 82% stake.
Alcoa also intends to divest four non-core downstream businesses:
* Electrical and Electronic Systems;
* Global Foil;
* Cast Auto Wheels; and
* Transportation Products Europe.
The businesses to be sold had 2008 combined revenues of $1.8
billion and an estimated after-tax operating loss of approximately
$105 million. The businesses employ a combined 22,600 people at
38 locations. Expected net proceeds for the divestitures are
estimated to be approximately $100 million.
Capital Expenditures and Liquidity
Building on the previously announced initiative to conserve cash
and suspend the company's share repurchase program, the company is
stopping all non-critical capital investment. Capital
expenditures in 2009 are projected to be down to $1.8 billion, a
50% decrease from 2008, and will be $1.5 billion after partner
contributions. Capital spending includes approximately $750
million for the completion of key Brazilian growth projects. The
Sao Luis refinery expansion and the greenfield Juruti bauxite mine
are scheduled to be finished in the first half of 2009.
Impact
Total charges for the 4th quarter 2008 due to restructuring,
impairment and other special charges are expected to be between
$900 and $950 million after tax, or $1.13 to $1.19 per share, of
which approximately 80% is non-cash. The restructuring and
divestiture program is expected to save approximately $450 million
before taxes on an annualized basis.
"Because we recently completed an extensive competitive analysis,
including a strategic review of each business, we have been able
to quickly identify and implement effective responses that
strengthen our market competitiveness and financial staying power
in the economic downturn. We will continue to monitor the dynamic
market situation to ensure that we adjust capacity to meet any
future changes in demand and seize new opportunities that emerge.
These are extraordinary times requiring extraordinary actions,"
said Mr. Kleinfeld.
Alcoa Inc. -- http://www.alcoa.com/-- is the world leader in the
production and management of primary aluminum, fabricated aluminum
and alumina combined. Alcoa serves the aerospace, automotive,
packaging, building and construction, commercial transportation
and industrial markets, bringing design, engineering, production
and other capabilities of Alcoa's businesses to customers. In
addition to aluminum products and components including flat-rolled
products, hard alloy extrusions, and forgings, Alcoa also markets
Alcoa(R) wheels, fastening systems, precision and investment
castings, and building systems. The company operates in 34
countries and has been named one of the top most sustainable
corporations in the world at the World Economic Forum in Davos,
Switzerland.
As of September 30, 2008, Alcoa had $39.0 billion in total assets
and $21.2 billion in total liabilities.
AMERICAN AIRLINES: Bank Loan Sells at Substantial Discount
----------------------------------------------------------
Participations in a syndicated loan under which American Airlines
is a borrower traded in the secondary market at 68.80 cents-on-
the-dollar during the week ended December 26, 2008, according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal. This represents a drops of 2.00 percentage points
from the previous week, the Journal relates. American Airlines
pays interest at 225 points above LIBOR. The bank loan carries
Moody's B2 rating and Standard & Poor's B+ rating.
Headquartered in Forth Worth, Texas, AMR Corporation (NYSE:
AMR) operates with its principal subsidiary, American Airlines
Inc. -- http://www.aa.com/-- a worldwide scheduled passenger
airline. At the end of 2006, American provided scheduled jet
service to about 150 destinations throughout North America, the
Caribbean, Latin America, including Brazil, Europe and Asia.
American is also a scheduled airfreight carrier, providing
freight and mail services to shippers throughout its system.
Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two
regional airlines, American Eagle Airlines Inc. and Executive
Airlines Inc., and does business as "American Eagle." American
Beacon Advisors Inc., a wholly owned subsidiary of AMR, is
responsible for the investment and oversight of assets of AMR's
U.S. employee benefit plans, as well as AMR's short-term
investments.
* * *
As reported in the Troubled company Reporter on August 5, 2008,
the TCR said that Moody's Investors Service downgraded the
Corporate Family and Probability of Default Ratings of AMR Corp.
and its subsidiaries to Caa1 from B2, and lowered the ratings of
its outstanding corporate debt instruments and certain equipment
trust certificates and Enhanced Equipment Trust Certificates of
American Airlines Inc. The company still carries Moody's Negative
Outlook.
AMERICAN INT'L: Ex-CEO Wants Explanation on HSB Sale to Munich Re
-----------------------------------------------------------------
Maurice R. Greenberg, former American International Group Inc. CEO
and a shareholder at the company, has asked for a full explanation
from the company's board of what he described as a "distressed
sale price" of HSB Group Inc., a.k.a. Hartford Steam Boiler.
Mr. Greenberg sent a letter to AIG's board that the amount AIG is
to receive from the sale of HSB could "only be viewed as a
distressed sale price," after the AIG management confirmed that
AIG will sell HSB to Munich Re for $742 million. Liam Pleven at
The Wall Street Journal reports that AIG agreed in December to
sell HSB to Munich Re as it moves to repay a loan of up to
$60 billion it got from the government when it faced possible
bankruptcy, which gave the government an 80% stake in AIG.
According to WSJ, AIG had said that it got a fair price for HSB,
with a range of valuations for other specialty insurers and buyer
Munich Re's agreement to assume $76 million in debt. According to
WSJ, AIG acquired HSB for $1.2 billion in 2000.
Mr. Greenberg said in the letter filed at the Securities and
Exchange Commission that Munich Re Chief Financial Officer Joerg
Schneider said, "The sales price is, considering the profitability
of the acquired company, very low."
Mr. Greenberg wants a full explanation of the sale process that
led to approve the sale of HSB, a major asset, at such a low
value.
WSJ relates that Mr. Greenberg asked what the board did to make
sure that AIG would get "the highest available price" and said
that he might have considered bidding for HSB if he had known it
would be sold for $742 million. The report quoted Mr. Greenberg
as saying, "We believed that it would never be sold for under a
billion plus."
Mr. Greenberg asked who the other interested bidders were, whether
any bidders were omitted from the process, and whether AIG could
accept a higher bid now without penalty or significant break up
fee.
New Officers at AIG Environmental
American International Group has named Russell Johnston as
President and Chief Executive Officer of AIG Environmental, a unit
of AIG Commercial Insurance and a pollution liability insurance
provider. Mr. Johnston assumes management responsibility for AIG
Environmental from Joseph Boren, who has left the company. Mr.
Johnston will report to John Q. Doyle, President and Chief
Executive Officer of AIG Commercial Insurance.
In addition, Kimberly Hanna has been named Executive Vice
President and Chief Operating Officer of AIG Environmental.
Ms. Hanna will report to Russell Johnston.
John Doyle, President and Chief Executive Officer of AIG
Commercial Insurance, said, "Russ Johnston has over 20 years of
underwriting and management experience in the property casualty
industry, which will be a significant advantage for AIG
Environmental as it moves forward. I am excited about Russ and
Kim leading AIG Environmental's senior team, and expect continued
strong performance from that organization."
Mr. Johnston joined AIG in 1990 serving in senior management
positions within AIG's Risk Management Group, including President
of National Accounts, President of Domestic Risk Management and
most recently as President of AIG Risk Management. Mr. Johnston
holds a bachelor's degree from Syracuse University.
Ms. Hanna joined AIG's Canadian operations in 1996. In 2000, she
became a product line manager for AIG Environmental, and has held
positions of increasing responsibility within the Environmental
unit, including her most recent position as Senior Vice President
and Chief Underwriting Officer. Ms. Hanna holds a bachelor's
degree from McMaster University.
AIG Commercial Insurance Streamlines Casualty Insurance
AIG Commercial Insurance will service all casualty insurance
coverage for the public sector through its Lexington Insurance
Company unit. Specifically, effective as of Jan. 1, 2009,
Lexington's Casualty Division will manage the public entity
commercial umbrella and excess casualty portfolio of AIG Specialty
Excess, a division of AIG Excess Casualty, which along with
Lexington specializes in addressing the risks of public entities,
utilities and transit agencies.
The organizational change streamlines access to excess casualty
insurance through a centralized underwriting and claims resource
for clients and brokers. Lexington, and other AIG Commercial
Insurance units can provide a full selection of insurance products
and services to public entities, including workers' compensation,
excess workers' compensation, environmental, property,
construction, auto liability, executive liability and accident &
health programs.
"Consolidating our underwriting and claims capabilities for public
entities creates synergies to benefit customers and improves
service which brokers will appreciate," said David J. Bresnahan,
Executive Vice President, Lexington Insurance Company. "The move
delivers efficiency without sacrificing product strength, capacity
or important underwriting relationships."
About American International Group
Based in New York, American International Group, Inc. (AIG) is the
leading international insurance organization with operation in
more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the
most extensive worldwide property-casualty and life insurance
networks of any insurer. In addition, AIG companies are leading
providers of retirement services, financial services and asset
management around the world. AIG's common stock is listed on the
New York Stock Exchange, as well as the stock exchanges in Ireland
and Tokyo.
During the third quarter of 2008, requirements to post collateral
in connection with AIG Financial Products Corp.'s credit default
swap portfolio and other AIGFP transactions and to fund returns of
securities lending collateral placed stress on AIG's liquidity.
AIG's stock price declined from $22.76 on Sept. 8, 2008, to $4.76
on Sept. 15, 2008. On that date, AIG's long-term debt ratings
were downgraded by Standard & Poor's, a division of The McGraw-
Hill Companies, Inc., Moody's Investors Service and Fitch Ratings,
which triggered additional requirements for liquidity. These and
other events severely limited AIG's access to debt and equity
markets.
On Sept. 22, 2008, AIG entered into an $85 billion revolving
credit agreement with the Federal Reserve Bank of New York and,
pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000
shares of Series C Perpetual, Convertible, Participating Preferred
Stock to a trust for the benefit of the United States Treasury.
At Sept. 30, 2008, amounts owed under the facility created
pursuant to the Fed Credit Agreement totaled $63 billion,
including accrued fees and interest.
Since Sept. 30, AIG has borrowed additional amounts under the
Fed Facility and has announced plans to sell assets and businesses
to repay amounts owed in connection with the Fed Credit Agreement.
In addition, subsequent to Sept. 30, 2008, certain of AIG's
domestic life insurance subsidiaries entered into an agreement
with the NY Fed pursuant to which the NY Fed has borrowed, in
return for cash collateral, investment grade fixed maturity
securities from the insurance subsidiaries.
On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through
its Troubled Asset Relief Program, $40 billion of newly issued AIG
perpetual preferred shares and warrants to purchase a number of
shares of common stock of AIG equal to 2% of the issued and
outstanding shares as of the purchase date. All of the proceeds
will be used to pay down a portion of the Federal Reserve Bank of
New York credit facility. The perpetual preferred shares will
carry a 10% coupon with cumulative dividends.
AIG and the Fed also agreed to revise the existing FRBNY credit
facility. The loan terms were extended from two to five years to
give AIG time to complete its planned asset sales in an orderly
manner. The equity interest that taxpayers will hold in AIG,
coupled with the warrants, will total 79.9%.
At Sept. 30, 2008, AIG had $1.022 trillion in total consolidated
assets and $950.9 billion in total debts. Shareholders' equity
was $71.18 billion, including the addition of $23 billion of
consideration received for preferred stock not yet issued.
AMERICAN INTL: Rescinds Ex-CEO Willumstad Restricted Share Award
----------------------------------------------------------------
American International Group, Inc., and Robert B. Willumstad,
former chairman and chief executive officer of AIG, rescinded on
December 26, 2008, the grant of Mr. Willumstad's Sign-On
Restricted Share Award, which represented 1,052,406 shares of AIG
Common Stock. Mr. Willumstad retains his previously granted
options to purchase AIG Common Stock -- which have exercise prices
ranging from $23.28 to $68.61. Mr. Willumstad also confirmed his
waiver of roughly $22.5 million in severance under AIG' Executive
Severance Plan.
A full-text copy of the December 26, 2008 agreement between the
parties is available at no charge at:
http://ResearchArchives.com/t/s?3752
Except as modified by December 26 agreement, Mr. Willumstad's
employment letter, including dispute resolution and
indemnification provisions and any other payment or benefit rights
Mr. Willumstad may have, continues in effect.
AIG's stock has been closing at under $3 a share since Dec. 2,
2008.
Based in New York, American International Group, Inc. (AIG) is the
leading international insurance organization with operation in
more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the
most extensive worldwide property-casualty and life insurance
networks of any insurer. In addition, AIG companies are leading
providers of retirement services, financial services and asset
management around the world. AIG's common stock is listed on the
New York Stock Exchange, as well as the stock exchanges in Ireland
and Tokyo.
During the third quarter of 2008, requirements to post collateral
in connection with AIG Financial Products Corp.'s credit default
swap portfolio and other AIGFP transactions and to fund returns of
securities lending collateral placed stress on AIG's liquidity.
AIG's stock price declined from $22.76 on Sept. 8, 2008, to $4.76
on Sept. 15, 2008. On that date, AIG's long-term debt ratings
were downgraded by Standard & Poor's, a division of The McGraw-
Hill Companies, Inc., Moody's Investors Service and Fitch Ratings,
which triggered additional requirements for liquidity. These and
other events severely limited AIG's access to debt and equity
markets.
On Sept. 22, 2008, AIG entered into an $85 billion revolving
credit agreement with the Federal Reserve Bank of New York and,
pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000
shares of Series C Perpetual, Convertible, Participating Preferred
Stock to a trust for the benefit of the United States Treasury.
At Sept. 30, 2008, amounts owed under the facility created
pursuant to the Fed Credit Agreement totaled $63 billion,
including accrued fees and interest.
Since Sept. 30, AIG has borrowed additional amounts under the
Fed Facility and has announced plans to sell assets and businesses
to repay amounts owed in connection with the Fed Credit Agreement.
In addition, subsequent to Sept. 30, 2008, certain of AIG's
domestic life insurance subsidiaries entered into an agreement
with the NY Fed pursuant to which the NY Fed has borrowed, in
return for cash collateral, investment grade fixed maturity
securities from the insurance subsidiaries.
On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through
its Troubled Asset Relief Program, $40 billion of newly issued AIG
perpetual preferred shares and warrants to purchase a number of
shares of common stock of AIG equal to 2% of the issued and
outstanding shares as of the purchase date. All of the proceeds
will be used to pay down a portion of the Federal Reserve Bank of
New York credit facility. The perpetual preferred shares will
carry a 10% coupon with cumulative dividends.
AIG and the Fed also agreed to revise the existing FRBNY credit
facility. The loan terms were extended from two to five years to
give AIG time to complete its planned asset sales in an orderly
manner. The equity interest that taxpayers will hold in AIG,
coupled with the warrants, will total 79.9%.
At Sept. 30, 2008, AIG had $1.022 trillion in total consolidated
assets and $950.9 billion in total debts. Shareholders' equity
was $71.18 billion, including the addition of $23 billion of
consideration received for preferred stock not yet issued.
ARCHWAY COOKIES: Owes Ashland Businesses Almost $1 Million
----------------------------------------------------------
Linda Martz at Mansfield News Journal reports that Archway Cookies
owes businesses in Ashland almost $1 million.
Court documents say that Archway Cookies owed one of its
creditors, Staffing Partners, about $103,727, according to court
records. Mansfield News quoted Staffing Partners spokesperson as
saying, "If we don't get paid, that's quite a serious financial
impact to a small business owner." The report says that Staffing
Partners has started examining whether some of Archway Cookies'
debt can be recovered through Lance Inc., which purchased Archway
Cookies' Ashland plant in December. According to the report,
Ms. Fonseca said, "The part we don't know about yet is how the
purchase is written. If it's a simple bankruptcy, there's really
no hope for us to get anything. We're not secured creditors. We
don't have a lien. ... We're down at the bottom of the list."
Mansfield News relates that the largest single claims from local
businesses were:
-- Cowen Truck Line, Perrysville, about $314,588;
-- Elite Logistics Solutions, Ashland, about $85,434; and
-- CRW Freight Management, Shreve, about $80,726.
According to Mansfield News, Archway Cookies owes Springfield Mold
& Die about $19,824, the ninth highest amount for any local
entity.
Archway Cookies, Mansfield News states, said that the bulk of its
debt -- about $107.35 million in secured debt -- was owed to
Wachovia bank and Catterton Partners, Archway Cookies' largest
shareholder.
Mansfield News reports that Archway Cookies presented a second
list to the court, listing creditors with unsecured debt who have
$2.53 million in priority claims. The list includes:
-- $1.49 million Archway Cookies owed in wages, salaries or
commissions;
-- $95,000 in unpaid payroll garnishments; and
-- $85,000 in other payroll expenses, along with Federal
Insurance Contributions Act payments, and other claims
related to taxes or payroll.
Mansfield News relates that a third list was presented to the
court, disclosing creditors who had unsecured debt and non-
priority claims, totaling $33.08 million. The report says that
almost 70 entities in Richland, Ashland or Wayne counties -- owed
$989,119 -- were included in that list.
Archway Cookies said in its financial statements that it owed the
Ashland County Treasurer about $314,519 in unsecured priority
claims, along with $198,866 in unsecured nonpriority claims.
Citing Ashland County Treasurer Cindy Funk, Mansfield News reports
that Archway Cookies actually owes much less. Ms. Funk said that
when Archway Cookies filed for bankruptcy, it owed the county
about $321,025 in real property and personal property taxes,
Mansfield News states. The report says that Archway Cookies has
paid up $26,304 in its real property taxes. Citing Ms. Funk,
Mansfield News relates that Archway Cookies owes about $297,186 in
personal property taxes and current penalties.
Mansfield News reports that the City of Ashland's municipal income
tax department was listed as being owed a total of $23,308 in
taxes.
Archway Cookies said in financial statements filed in December
that it had $143 million in debt and $92 million in assets.
Archway Cookies said that patents, copyrights, or intellectual
property comprise $41 million of the assets.
About Archway Cookies
Headquartered in Battle Creek, Michigan, Archway Cookies, LLC, --
http://www.archwaycookies.com/-- makes soft-baked cookies. And
crackers. In 1998, Specialty Foods Corp. acquired the Debtors'
for about $100 million.
Parmalat Finanziaria of Italy acquired Mother's Cake and Cookie
Company and Archway Cookies from The Specialty Foods Acquisition
Corporation for $250 million in 2000. Parmalat later sold its
North American Bakery Group, which includes the Archway brands,
Mother's brands and the U.S. and Canadian private label cookie
businesses, to the private equity firm Catterton Partners and
their operating partner Insight Holdings in 2005.
Archway Cookies filed for Chapter 11 protection on Oct. 6, 2008
(Bankr. D. Del. Case No. 08-12323). Its affiliate, Mother's Cake
& Cookie Co. also filed for bankruptcy (Bankr. D. Del. Case No.
08-12326). Michael R. Lastowski, Esq., at Duane Morris, LLP,
represent the Debtors in their restructuring efforts. In their
filing, the Debtors listed estimated assets of between
$50 million and $100 million and estimated debts of between
$500 million and $1 billion.
ATP OIL & GAS: Bank Loan Sells at Substantial Discount
------------------------------------------------------
Participations in a syndicated loan under which ATP Oil & Gas
Corp. is a borrower traded in the secondary market at 56.25 cents-
on-the-dollar during the week ended January 2, 2009, according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal. This represents a drop of 2.08 percentage points
from the previous week, the Journal relates. ATP Oil & Gas pays
interest at 475 points above LIBOR. The bank loan matures on
December 30, 2013. The bank loan is unrated.
ATP Oil & Gas Corp. is an international offshore oil and gas
development and production company with operations in the Gulf of
Mexico and the North Sea. The company trades publicly as "ATPG"
on the NASDAQ Global Select Market. On the Net:
http://www.atpog.com/
BASELINE OIL: Posts $35MM Net Loss in Quarter Ended Sept. 30
------------------------------------------------------------
Baseline Oil & Gas Corp. posted a net loss of $35,005,335 for the
three months ended September 30, 2008, on revenues of $11,845,200.
"During the third quarter of 2008, we incurred expenses totaling
$35.8 million as a result of the conversion of our Convertible
Notes to common equity, as well as due to the restructuring of its
Senior Secured Notes subsequent to our failure to repurchase such
notes on October 6, 2008. Included in this $35.8 million of total
expense was a $15.6 million make-whole premium required to be paid
on the Convertible Notes, $8.7 million of remaining unamortized
deferred loan costs on the Senior Secured Notes,
$3.5 million of unamortized debt discount on the Senior Secured
Notes, $4.5 million of unamortized deferred loan costs on the
Convertible Notes and $3.5 million of premiums paid under the
change of control purchase offer and consent solicitation on the
Senior Secured Notes," Chief Executive Officer Thomas R. Kaetzer
disclosed in a regulatory filing dated November 14, 2008.
On October 31, 2008, the company completed a restructuring of its
debt. As a result of the restructuring, the majority of its debt
will mature on June 15, 2009. "The future of the company is
dependent on its ability to obtain addition capital through debt
or equity offerings or the sale of oil and natural gas properties.
Given the current instability in the financial and equity markets
and current oil and natural gas pricing levels there is no
assurance that the company will be able to raise the capital
needed. These conditions raise substantial doubt about the
company's ability to continue as a going concern," Mr. Kaetzer
said.
"The disruption experienced in U.S. and global credit markets
during the latter half of 2008 has resulted in projected decreases
in demand for oil and natural gas, resulting in a sharp drop in
energy prices, and has affected the availability and cost of
capital. Prolonged negative changes in domestic and global
economic conditions or disruptions of either or both of the
financial and credit markets may have a material adverse effect on
our results from operations, financial condition and liquidity.
At this time, it is unclear whether and to what extent the actions
taken by the U.S. government, including, without limitation, the
passage of the Emergency Economic Stabilization Act of 2008 and
other measures currently being implemented or contemplated, will
mitigate the effects of the financial market turmoil. The impact
of the current difficult conditions on our ability to obtain, and
the cost and terms of, any financing in the future, including
funding for our operations after the earlier expiration of our
existing credit facility, as amended, and the retirement of our
new Senior Secured Notes on June 15, 2009, is unclear."
As of September 30, 2008, the company's balance sheet showed total
assets of $165,043,575, total liabilities of $148,806,654, and
total stockholders' equity of $16,236,921. Accumulated deficit
reached $82,383,104.
A full-text copy of the company's quarterly report is available
for free at: http://researcharchives.com/t/s?3768
About Baseline Oil & Gas Corp.
Baseline Oil & Gas Corp. is an independent exploration and
production company primarily engaged in the acquisition,
development, production and exploration of oil and natural gas
properties onshore in the United States.
BELL MICROPRODUCTS: Completes Restatement of Financial Reports
--------------------------------------------------------------
Bell Microproducts Inc. has completed its restatement of its
financial statements for 2005, 2004 and prior years and has filed
its Annual Report on Form 10-K for the year ended December 31,
2006 with the Securities and Exchange Commission.
"We are pleased to have accomplished this important goal in
December as planned," said W. Donald Bell, President and Chief
Executive Officer. "This is a major step to becoming current with
our SEC reporting obligations. We appreciate the continued
support of our many customers, vendors, lenders, employees and
shareholders who have supported us throughout this challenging
process. While we still have work ahead of us, we are pleased to
move forward with a focus on our competencies gained in 20 years
of industry leadership."
Fiscal 2006 Results and Restatement Summary
Revenues for the fourth quarter of 2006 were a then-current record
$984 million, a 27% increase sequentially and a 21% increase over
the fourth quarter of 2005. The company generated a net loss for
the fourth quarter of $22.1 million, or ($0.69) per share, as
compared to net income of $0.3 million, or $0.01 per share, in the
third quarter of 2006 and a net loss of $11.9 million, or ($0.40)
per share, in the fourth quarter of 2005.
Included in the loss in the fourth quarter of 2006 was an income
tax provision of $23.1 million, or ($0.72) per share, to record an
allowance against certain deferred tax assets.
Revenues for the full year 2006 also reached a then-current record
of $3.37 billion, an increase of 7% over 2005 revenues of $3.14
billion. Including the tax provision in the fourth quarter, the
company recorded a 2006 net loss of $23.1 million, or ($0.75) per
share, as compared to a net loss of $15.6 million, or ($0.53) per
share, in 2005. The company's operating results in 2005 included
a charge of $7.3, million or ($0.24) per share, for the impairment
of goodwill and other intangible assets.
The components of the restatement are outlined in detail in the
company's 2006 Annual Report on Form 10-K. Following are the key
adjustments the company recorded through June 30, 2006, most of
which have been previously announced:
* Non-cash goodwill impairment charges of $33.2 million,
substantially all of which were recorded in the year ended
December 31, 2002, lower than the previously-announced
estimate of $50 million to $70 million;
* Non-cash compensation costs and related payroll tax effect
of approximately $8.8 million in connection with the
company's review of its historical stock option practices
for the period from 1996 through the second quarter of
2006;
* Reversals of certain accounts receivable adjustments of
$12.8 million, which were previously recorded as
reductions of operating expenses in the period January 1,
1997 through June 30, 2006;
* Changes in the classification of certain acquisition-
related earnout payments of approximately $5.8 million
from additional purchase price to compensation expense,
which reduced previously-reported pretax income in the
years ended December 31, 2004 and 2005;
* Reversals of vendor allowances of $8.2 million in
connection with certain transactions over the period
January 1, 2002 through June 30, 2006. The company has
received agreements from the vendors and anticipate
recognizing these related vendor allowances in the quarter
it entered into the agreement;
* Various other accounting adjustments, including adjustments
related to the review of reserves, accruals and other
accounting
estimates, that reduced pre-tax income by $13.1 million
during
the period from January 1, 1999 to June 30, 2006; and
* Aggregate income tax benefits of $14.7 million over the
period
from January 1, 1999 to June 30, 2006.
The company has incurred total outside audit, legal and consultant
fees and expenses in connection with the restatement of
approximately $69.8 million through November 30, 2008. In
addition, the company incurred $11.1 million in fees related to
obtaining covenant waivers due to the late filing of the company's
financial statements, which included an 8.5% special interest
payment of $9.4 million paid in early 2007 under the company's
convertible notes. With the completion of the restatement, the
company expects these expenses to decline significantly in 2009.
Fourth Quarter 2008
The company also noted that changes in foreign currency exchange
rates have been unprecedented in the latter part of 2008. During
the first two months of the fourth quarter, the foreign currencies
in which the company primarily does business have declined
relative to the U.S. dollar, in the aggregate, by approximately
18%. As a result, although the company hedges its foreign
currency exposure, it experienced currency losses of approximately
$6 million in this same period. In addition, changes in currency
exchange rates are expected to result in lower reported
international sales in the fourth quarter.
In the U.S., for the fourth quarter, the company's distribution
business has experienced sales declines, while the company's total
single tier enterprise businesses are expected to experience flat
sales compared to the same period in 2007.
Due to the changes in foreign currency exchange rates described
above and market weakness in most geographies, the company
presently expects to report fourth quarter sales in the range of
approximately $750 million to $800 million. Due to the lower
sales volumes, the company has taken actions to reduce operating
expenses by approximately 7%, or $22 million per year, from that
incurred in the third quarter of 2008. The reduction in operating
expenses was accomplished through a reduction in personnel levels
and other cost-reduction programs.
About Bell Microproducts Inc.
Based in San Jose, California, Bell Microproducts (Other OTC:BELM)
-- http://www.bellmicro.com/-- is an international, value-added
distributor of a wide range of high-tech products, solutions and
services, including storage systems, servers, software, computer
components, and peripherals, as well as maintenance and
professional services. An industry-recognized specialist in
storage products, the company is one of the world's largest
storage-centric value-added distributors.
BERNARD L. MADOFF: Prosecutors Want Founder Imprisoned
------------------------------------------------------
Chad Bray, Amir Efrati, and Kara Scannell at The Wall Street
Journal report that prosecutors including Assistant U.S. Attorney
Marc Litt asked U.S. Magistrate Judge Ronald L. Ellis for the
imprisonment of Bernard Madoff on Monday, after he and his wife
sent more than $1 million of watches, jewelry and other valuables
to his brother, his sons, and a couple in Florida in December.
WSJ relates that Mr. Madoff has been free on a $10 million
personal recognizance bond, after being arrested in December. The
report says that Mr. Madoff is under 24-hour home detention and a
private security firm is monitoring the entrances to his
apartment.
Mr. Litt, according to WSJ, said during a hearing in New York City
that Mr. Madoff's bail should be because he violated an injunction
freezing his assets by giving away the valuables, which Mr.
Madoff's attorney, Ira Sorkin, said include:
-- watches,
-- $25 cuff links given to Mr. Madoff by his granddaughter,
-- pens, and
-- $200 mittens that were a Hanukkah gift.
Mr. Madoff or his wife tried to transfer valuables, with
Mr. Madoff personally sending a handwritten note with at least one
of the items, WSJ says, citing Mr. Litt. According to the report,
the government was able to recover three of the five items.
Judge Ellis denied the prosecutors' request, and asked that they
file papers on the motion, says WSJ.
Citing a source, WSJ reports that Mr. Madoff's sons, Mark and
Andrew Madoff, said that they received three packages from their
parents on Dec. 30 and 31. Mr. Madoff, according to the report,
hasn't contacted his sons since confessing his fraud. The report
states that the brothers informed their lawyers, who then
contacted the U.S. attorney's office in Manhattan about the
packages.
The items were sent "innocently" on Dec. 24 to Mr. Madoff's
brother Peter, his sons, a daughter-in-law, and a couple in
Florida, WSJ says, citing Mr. Sorkin. WSJ relates that Mr. Sorkin
said the Madoffs have tried getting the items back after they were
advised by lawyers that they shouldn't have sent the items.
Prosecutors weren't aware of some of the transfers until Mr.
Madoff's attorneys informed them on Monday, WSJ reports, citing
Mr. Sorkin.
Judge Ellis said that he was concerned about the government's
argument of potential "economic harm" to the community as enough
reason to revoke bail, WSJ states.
Kara Scannell at WSJ relates that the Securities and Exchange
Commission and other regulators have investigated Bernard L.
Madoff Investment Securities LLC at least eight times in 16 years.
Mr. Madoff, says WSJ, was interviewed at least twice by the SEC.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks. The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties. It also performed clearing and
settlement services. Clients included brokerages, banks, and
other financial institutions. In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.
The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.
As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm. The estimated
losses from Madoff's fraud were at least $50 billion.
BLOCKBUSTER INC: Bank Loan Sells at 41% Discount
------------------------------------------------
Participations in a syndicated loan under which BlockBuster is a
borrower traded in the secondary market at 58.80 cents-on-the-
dollar during the week ended January 2, 2009, according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. This represents an increase of 1.30 percentage points
from the previous week, the Journal relates. BlockBuster pays
interest at 375 points above LIBOR. The bank loan matures on
August 20, 2011. The bank loan carries Moody's B1 rating and
Standard & Poor's B rating.
Headquartered in Dallas, Texas, Blockbuster Inc. (NYSE: BBI,
BBI.B) -- http://www.blockbuster.com/-- is a provider of in-home
movie and game entertainment, with over 7,800 stores throughout
the Americas, Europe, Asia and Australia. The company maintains
operations in Brazil, Mexico, Denmark, Italy, Taiwan, and
Australia.
* * *
In August 2008, Moody's Investors Service downgraded Blockbuster
Inc.'s probability of default rating to Caa1 from B3. The
company's Caa1 corporate family rating, Caa2 senior subordinated
note rating, and SGL-4 speculative grade liquidity rating were
affirmed. At the same time, Moody's raised the company's secured
bank facilities to B1 from B3. Moody's said that the outlook
remains negative.
In December 2007, Fitch Ratings affirmed Blockbuster Inc.'s long-
term Issuer Default Rating at 'CCC' and the senior subordinated
notes at 'CC/RR6'. Fitch said that the rating outlook is stable.
BRTC INVESTMENTS: Case Summary & Six Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: BRTC Investments LP a Texas Limited Partnership
6360 La Punta Drive
Los Angeles, CA 90068
Bankruptcy Case No.: 09-10080
Chapter 11 Petition Date: January 5, 2009
Court: Central District Of California (Los Angeles)
Judge: Thomas B. Donovan
Debtor's Counsel: William G. Barrett, Esq.
419 N. Larchmont #91
Los Angeles, CA 90004
Tel: (914) 522-8540
Fax: (760) 322-2391
Estimated Assets: $10 million to $50 million
Estimated Debts: $10 million to $50 million
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
HH Investments unsecured loan $402,072
6217 Franklin #553
Hollywood, CA 90028
Tel: (323) 460-4015
Roslyn Millet unsecured loan $400,000
11400 Olympic Blvd., 9th flr.
Los Angeles, CA 90068
Tel: (310) 489-4100
BFT unsecured loan $254,884
6317 Franklin #553
Tel: (760) 325-1877
Diversified Collection unsecured $416
Services Inc. creditor
211 Investments LP unsecured debt $250
Mt. Laurel Investments unsecured debt $200
The petition was signed by manager D. Bailey.
BRUNSWICK CORP: to Mothball Riverview Boat Plant Amid Slow Demand
-----------------------------------------------------------------
Brunswick Corporation will mothball its Riverview boat
manufacturing facility near Knoxville, Tenn., and take additional
actions aimed at reducing its work force, production and expenses.
One of three manufacturing facilities in the Knoxville area,
Riverview makes Sea Ray boats and will wind down production during
the first quarter of the year. To better utilize Brunswick's
overall boat making capacity, production at Riverview will be
moved to nearby plants in Knoxville and Vonore, Tenn., which will
remain in operation. In addition, production of certain models
will be transferred to Brunswick's Palm Coast manufacturing
facility in Florida, and a Brunswick plant in Reynosa, Mexico.
The final impact of these production shifts on staff levels at
those locations, if any, is still being determined.
At year-end 2008, Brunswick employed about 1,500 people in the
Knoxville area. Approximately 300 production and support
positions at Riverview will be idled by this action over the
coming months. The company said it will work diligently to
transfer as many Riverview employees as possible to the nearby
Knoxville and Vonore manufacturing facilities. By mothballing this
facility, Brunswick retains the option of restoring production
should market conditions reverse and improve.
In addition, Brunswick plans to reduce up to 275 additional
positions throughout Sea Ray manufacturing and product development
facilities as well as at Sea Ray's Knoxville headquarters by
Friday, Jan. 9. Further, all Sea Ray manufacturing facilities in
Tennessee and Florida have scheduled at least a week of production
furloughs each month through the end of June to reduce production
rates. To be observed generally during the third week of each
month, these furloughs will also provide the flexibility needed to
integrate the models moving between facilities throughout early
2009. The company said it has the option to cancel or modify
furlough periods, should marine market demand improve or pipeline
inventory be depleted quicker than anticipated.
"We have taken a number of actions over the past few years in an
effort to mitigate persistent difficult conditions in the global
marine market and economy," said Brunswick Chairman and Chief
Executive Officer Dustan E. McCoy. "These actions have included
reduced production rates, as well as virtually halting production
during periodic furloughs. The three plants near Knoxville have
recently completed a production furlough, which has helped reduce
our overall marine pipeline, but the global marine market remains
in a severe downturn because of the weakening economies here and
abroad and anxious consumer sentiment. These conditions have led
to the difficult decision to mothball the Riverview facility.
"This decision does not reflect upon the Riverview work force or
product, but is the result of our need to develop a more efficient
manufacturing footprint that is appropriate to the marketplace,"
Mr. McCoy added. "In addition to Riverview, we have closed,
mothballed or sold 14 other North American boat plants since 2006
in response to these difficult economic conditions."
About Brunswick Corp.
Headquartered in Lake Forest, Illinois, Brunswick Corporation
(NYSE:BC) -- http://www.brunswick.com/-- is a manufacturer and
marketer of recreation products, including boats, marine engines,
fitness equipment, and bowling and billiards equipment. It has
four segments: Boat, Marine Engine, Fitness, and Bowling &
Billiards. It owns and operates Brunswick bowling centers in the
United States and other countries.
* * *
As reported by the Troubled Company Reporter on November 27, 2008,
Moody's Investors Service downgraded the rating on Brunswick's
corporate family rating and probability of default rating to B2
from Ba2 due to the rapidly deteriorating discretionary consumer
spending environment and Moody's belief that Brunswick could
possibly violate a leverage covenant in the fourth quarter of
2008. At the same time, the rating on the unsecured notes was
downgraded to Caa1 from Ba3. The ratings remain under review. LGD
assessments are subject to change, but are not under review.
The TCR reported November 13, 2008, Standard & Poor's Ratings
Services lowered its corporate credit and issue-level ratings on
Brunswick. The corporate credit rating was lowered to 'B-' from
'BB-', based on a likely bank covenant violation in the fourth
quarter. The rating outlook is negative. S&P kept the issue-
level rating on Brunswick Corp.'s senior unsecured debt on
CreditWatch with negative implications, reflecting S&P's concern
that a proposed amendment to the company's revolving credit
facility could possibly change its status from an unsecured debt
obligation to a secured debt obligation. This would impair
recoveries for existing unsecured noteholders in the event of a
payment default. S&P will review its issue-level and recovery
ratings once the company has completed its negotiations with
lenders and details of the amendment are available. Total debt
outstanding at Brunswick was $726.7 million as of Sept. 27, 2008.
BRUNSWICK CORP: To Make More Staff, Production & Expense Cuts
-------------------------------------------------------------
Brunswick Corporation will mothball its Riverview boat
manufacturing facility near Knoxville, Tennessee, and take
additional actions aimed at reducing its work force, production
and expenses. One of three manufacturing facilities in the
Knoxville area, Riverview makes Sea Ray boats and will wind down
production during the first quarter of the year. To better
utilize Brunswick's overall boat making capacity, production at
Riverview will be moved to nearby plants in Knoxville and Vonore,
Tenn., which will remain in operation. In addition, production of
certain models will be transferred to Brunswick's Palm Coast
manufacturing facility in Florida, and a Brunswick plant in
Reynosa, Mexico. The final impact of these production shifts on
staff levels at those locations, if any, is still being
determined.
At year-end 2008, Brunswick employed about 1,500 people in the
Knoxville area. Approximately 300 production and support
positions at Riverview will be idled by this action over the
coming months. The company said it will work diligently to
transfer as many Riverview employees as possible to the nearby
Knoxville and Vonore manufacturing facilities. By mothballing
this facility, Brunswick retains the option of restoring
production should market conditions reverse and improve.
In addition, Brunswick plans to reduce up to 275 additional
positions throughout Sea Ray manufacturing and product development
facilities as well as at Sea Ray's Knoxville headquarters by
Friday, Jan. 9. Further, all Sea Ray manufacturing facilities in
Tennessee and Florida have scheduled at least a week of production
furloughs each month through the end of June to reduce production
rates. To be observed generally during the third week of each
month, these furloughs will also provide the flexibility needed to
integrate the models moving between facilities throughout early
2009. The company said it has the option to cancel or modify
furlough periods, should marine market demand improve or pipeline
inventory be depleted quicker than anticipated.
"We have taken a number of actions over the past few years in an
effort to mitigate persistent difficult conditions in the global
marine market and economy," said Brunswick Chairman and Chief
Executive Officer Dustan E. McCoy. "These actions have included
reduced production rates, as well as virtually halting production
during periodic furloughs. The three plants near Knoxville have
recently completed a production furlough, which has helped reduce
our overall marine pipeline, but the global marine market remains
in a severe downturn because of the weakening economies here and
abroad and anxious consumer sentiment. These conditions have led
to the difficult decision to mothball the Riverview facility.
"This decision does not reflect upon the Riverview work force or
product, but is the result of our need to develop a more efficient
manufacturing footprint that is appropriate to the marketplace,"
Mr. McCoy added. "In addition to Riverview, we have closed,
mothballed or sold 14 other North American boat plants since 2006
in response to these difficult economic conditions."
About Brunswick
Headquartered in Lake Forest, Illinois, Brunswick Corporation --
http://www.brunswick.com-- endeavors to instill "Genuine
Ingenuity"(TM) in all its leading consumer brands, including
Mercury and Mariner outboard engines; Mercury MerCruiser
sterndrives and inboard engines; MotorGuide trolling motors;
Teignbridge propellers; Arvor, Bayliner, Bermuda, Boston Whaler,
Cabo Yachts, Crestliner, Cypress Cay, Harris, Hatteras, Kayot,
Lowe, Lund, Maxum, Meridian, Ornvik, Princecraft, Quicksilver,
Rayglass, Sea Ray, Sealine, Triton, Trophy, Uttern and Valiant
boats; Attwood marine parts and accessories; Land 'N' Sea, Kellogg
Marine, Diversified Marine and Benrock parts and accessories
distributors; IDS dealer management systems; Life Fitness, Hammer
Strength and ParaBody fitness equipment; Brunswick bowling
centers, equipment and consumer products; Brunswick billiards
tables; and Dynamo, Tornado and Valley pool tables, Air Hockey and
foosball tables.
According to the TCR on Nov. 13, 2008, Standard & Poor's Ratings
Services lowered its corporate credit and issue-level ratings on
Brunswick Corp. The corporate credit rating was lowered to 'B-'
from 'BB-', and it was removed from CreditWatch, where it was
placed with negative implications on Oct. 10, 2008, based on a
likely bank covenant violation in the fourth quarter. S&P said
that the rating outlook is negative.
BRUNSWICK CORP: Moody's Confirms 'B2' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service confirmed Brunswick's ratings (B2 CFR
and PDR and Caa1 senior unsecured notes) following the company's
recent announcement that it had amended its revolving credit
facility and joint venture agreement with General Electric. At
the same time, Moody's assigned an SGL 2 speculative grade
liquidity rating. These actions conclude a review for possible
downgrade initiated on November 25, 2008, which was the last
rating action. The rating outlook is negative.
"The rating confirmation reflects more stability in the company's
liquidity profile following the amendment of its revolver, which
reduced the size of the revolving credit facility to $400 million,
eliminated quarterly maintenance financial covenants and changed
the agreement into an asset backed facility" said Kevin Cassidy,
Senior Credit Officer at Moody's Investors Service. The ratings
confirmation also reflects Moody's expectation that Brunswick will
continue to take all steps necessary to ensure its ongoing
viability in the midst of extreme uncertainty and volatility in
discretionary consumer spending through its aggressive cost
cutting initiatives and reduction in its marine production.
Moody's believes that Brunswick will likely generate free cash
flow in 2009 as it continues to reduce working capital. However,
overall profitability and debt protection measurements will remain
stressed in the foreseeable future given low expectations for
demand for its products. The company's sucess in amending both
the revolver and the GE joint venture agreement should provide the
company with a buffer to withstand further demand deterioration,
in Moody's view.
The negative outlook reflects the ongoing deterioration in
discretionary consumer spending and the uncertainty in the capital
markets. The negative outlook also reflects Moody's view that
discretionary spending will continue to deteriorate for the
foreseeable future due to the continuing financial crises and that
this may put additional pressure on the company's dealership
network and its liquidity position.
The SGL 2 speculative grade liquidity rating reflects Moody's view
that Brunswick will maintain a good liquidity profile over the
next twelve months. Brunswick's liquidity profile is highlighted
by cash balances of around $300 million, no near term debt
maturities, access to an undrawn $400 million asset based credit
facility, the lack of any maintenance financial covenants (the
amended credit agreement and GE joint venture agreement both
contain a 1.1x fixed charge coverage ratio covenant if
availability under the $400 million revolver falls to $60 million
or less), and the ability to monetize selected assets. The
company's liquidity profile is constrained by the high degree of
uncertainty in discretionary consumer spending and possible cash
outlays to support its dealership network if consumer demand is
significantly less than expected.
Ratings confirmed include:
-- Corporate family rating at B2;
-- Probability of default rating at B2;
-- Senior unsecured notes at Caa1 (LGD 5, 79%)
Ratings assigned include:
-- Speculative grade liquidity rating at SGL 2
Brunswick is headquartered in Lake Forest, Illinois. The company
manufactures marine engines, pleasure boats, bowling capital
equipment and fitness equipment, and operates retail bowling
centers. Sales for the twelve months ended September 2008
approximated $5.3 billion.
CAPITAL AUTOMOTIVE: Bank Loan Sells at 62% Discount
---------------------------------------------------
Participations in a syndicated loan under which Capital Automotive
REIT is a borrower traded in the secondary market at 38.20 cents-
on-the-dollar during the week ended January 2, 2009, according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal. This represents a drop of 1.00 percentage points
from the previous week, the Journal relates. Capital Automotive
REIT pays interest at 175 points above LIBOR. The bank loan
matures on December 16, 2010. The bank loan carries Moody's Ba1
rating and Standard & Poor's BB rating.
As reported by the Troubled Company Reporter on December 23, 2008,
participations in the bank loan traded in the secondary market at
39.75 cents-on-the-dollar during the week ended December 19, 2008
-- an increase of 2.85 percentage points from the previous week.
As reported by the TCR on December 2, participations in the bank
loan traded in the secondary market at 41.90 cents-on-the-dollar
during the week ended November 28, 2008, representing a drop of
6.10 percentage points from the previous week.
Capital Automotive -- http://www.capitalautomotive.com/--
headquartered in McLean, Virginia, is a self-administered, self-
managed real estate investment trust. Formed in 1997, Capital
Automotive acquires real property and improvements used by
operators of multi-site, multi-franchised automotive dealerships
and related businesses. The specialty finance company has more
than $3.8 billion invested in more than 590 automotive franchise
facilities, and more than 17.5 million square feet of buildings on
more than 3,100 acres in 38 states and Canada.
Capital Automotive common shareholders voted on December 14, 2005,
to approve the Agreement and Plan of Merger among the company,
Capital Automotive L.P., Flag Fund V LLC, a Delaware limited
liability company, CA Acquisition REIT, a Maryland real estate
investment trust, and CALP Merger LP, a Delaware limited
partnership, and approve the merger, pursuant to which Flag Fund
will acquire the company and its subsidiaries.
CARDINAL COMMUNICATIONS: Voluntary Chapter 11 Case Summary
----------------------------------------------------------
Debtor: Cardinal Communications, Inc.
105 N. 5th St., Ste. 200
Canadian, TX 79014
Bankruptcy Case No.: 08-20693
Chapter 11 Petition Date: December 31, 2008
Court: United States Bankruptcy Court
Northern District of Texas (Amarillo)
Judge: Robert L. Jones
Debtor's Counsel: Roger S. Cox, Esq.
Sanders Baker PC
P.O. Box 2667
Amarillo, TX 79105-2667
Tel.: (806) 372-2020
Fax : (806) 342-5679
Email: bankruptcy@sandersbaker.com
Estimated Assets: $100,000 to $1,000,000
Estimated Debts: $1,000,000 to $100,000,000
The Debtor did not file a list of 20 largest unsecured creditors.
The petition was signed by Edouard A. Garneau, President of the
company.
CC MEDIA: Clear Channel Bank Loan Sells at Substantial Discount
---------------------------------------------------------------
Participations in a syndicated loan under which Clear Channel
Communications is a borrower traded in the secondary market at
49.80 cents-on-the-dollar during the week ended January 2, 2009,
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. This represents a drop of 1.87
percentage points from the previous week, the Journal relates.
Clear Channel Communications pays interest at 365 points above
LIBOR. The bank loan matures on December 30, 2015. The bank loan
carries Moody's B1 rating and Standard & Poor's B rating.
According to Standard & Poor's, Clear Channel is the No. 1 radio
operator in the U.S., in terms of revenue and number of stations,
and it has approximately a 90% ownership interest (through Clear
Channel Holdings) in Clear Channel Outdoor Inc., the largest
global outdoor advertiser. Clear Channel's radio segment has
significant geographic and format diversity, and is ranked No. 1
or No. 2 in terms of market share in all of the top 10 markets and
in roughly 70% of the top 25 markets.
Clear Channel Communications is the operating subsidiary of San
Antonio, Texas-based CC Media Holdings Inc.
CHEMTURA CORP: Lenders Relax Financial Covenants for 90 Days
------------------------------------------------------------
Chemtura Corporation entered into an amendment and waiver
agreement on December 30, 2008, with the lenders under its senior
credit facility, as well as with the providers of its U.S.
accounts receivable securitization facility. The company intends
to replace its U.S. accounts receivable securitization facility
before the end of January 2009.
The amendment and waiver agreement with the lenders under its
senior credit facility required, among other matters, a permanent
reduction in the facility commitments from $740 million to $500
million and a grant of a security interest in the company's U.S.
inventory, subject to certain limitations as provided under the
company's bond indentures. Certain of those lenders have
expressed their non-binding intention to subscribe to a
replacement accounts receivable securitization facility with up to
$150 million of capacity and a three-year term, subject to the
completion of a field audit, execution of mutually satisfactory
definitive agreements and certain other conditions. The lenders'
and the company's desire is to enter into this new facility before
the end of January 2009. Lenders who participate will reduce
their commitments to the senior credit agreement pro-rata to their
participation in the new securitization facility.
The company has also entered into an amendment and waiver
agreement with the providers of its U.S. accounts receivable
securitization facility. Among other matters, the agreement
provides for a 90-day waiver -- until March 30, 2009 -- of its
compliance with the financial maintenance covenants under the
senior credit agreement and a permanent reduction in the facility
size from $275 million to $100 million. The facility will
terminate upon the effectiveness of the replacement U.S. accounts
receivable securitization facility.
During the Waiver Period, advances outstanding under the Credit
Agreement are not permitted to exceed:
$180 million from the commencement of the Waiver Period
until December 31, 2008,
$195 million from January 1, 2009 to January 31, 2009, and
$190 million from February 1, 2009 until the end of the
Waiver Period.
During the Waiver Period, letters of credit are not permitted to
exceed $97 million.
During the Waiver Period, (i) the margin added to calculate
interest rates has been increased from 0.60% to 2.60% per annum
for base rate advances and from 1.60% to 3.60% per annum for
eurocurrency rate advances and (ii) the unused commitment fee has
been increased from 0.40% to 1.00% per annum (prior to the Waiver
Period, the margins and the unused commitment fee were based upon
Chemtura's public debt rating, and Chemtura was paying margin and
commitment fees at the highest rate). In addition, during the
Waiver Period, certain of the covenants in the Credit Agreement
have been amended to substantially restrict Chemtura's ability to
incur debt or liens, dispose of assets, and make investments.
Further, a restricted payments covenant has been added to the
Credit Agreement, restricting the ability of Chemtura to make cash
dividends and repurchase its equity during the Waiver Period,
subject to certain limited exceptions.
Citibank, N.A. is administrative agent for the senior credit
facility. The Royal Bank of Scotland, plc (as successor to ABN
AMRO N.V.), is administrative agent for the U.S. accounts
receivable securitization facility. Citibank Global Markets Inc.
is arranger for the replacement U.S. accounts receivable
securitization facility.
Chemtura entered into a Sixth Amendment and Waiver Agreement to
the Fourth Amended and Restated Receivables Sale Agreement dated
as of September 28, 2006, by and among Crompton & Knowles
Receivables Corporation, as seller, Chemtura, as the initial
collection agent, Royal Bank of Scotland, as agent, and various
other banks and liquidity providers. The Receivables Agreement
provides for the sale by the Seller to certain financial
institutions of an undivided interest in receivables originally
owed to Chemtura, Chemtura USA Corporation, Great Lakes Chemical
Corporation or Bio-Lab, Inc. Pursuant to the Sixth RA Amendment,
the Purchasers agreed to waive until the earlier to occur of (i)
March 30, 2009, or (ii) the date on which certain specified events
or if the amendment to the credit facility -- Second CA Amendment
-- will cease to be effective occur, certain provisions of the
Receivables Agreement which permit the Purchasers to terminate
their commitments to purchase additional undivided interests in
future receivables or exercise certain other remedies. In
addition, the Sixth RA Amendment, among other things, provides
for:
(i) a decrease in the aggregate purchase commitments of the
Purchasers from $275 million to $100 million,
(ii) shortening the scheduled expiration date of the
Purchasers' purchase commitments from August 30, 2010
to March 30, 2009,
(iii) an increase in the margin payable on the investment of
the Purchasers in the receivables from 1.25% to 2.5% per
annum prior to February 1, 2009 and 3.5% per annum
thereafter, and
(iv) an increase in the fee payable on the Purchasers' unused
commitments from 0.6% to 1.50% per annum (prior to the
date of the Sixth RA Amendment, the margin and the unused
commitment fee were based upon Chemtura's public debt
rating, and Chemtura was paying margin and commitment
fees at the highest rate).
Craig A. Rogerson, Chairman, President and CEO, commented: "As the
recession takes hold, the deterioration in business conditions has
impacted Chemtura's financial performance and outlook. We are
grateful for the support and prompt action by our lenders to
address the immediate impact of these changes."
Mr. Rogerson continued, "The amendments and waivers provide
Chemtura with the time we need to continue the orderly progress of
our asset sales process and to implement actions to reduce our
costs and manage cash flow. Further, we will have more clarity as
to the underlying customer demand as their inventory reduction
actions work through the global supply chain."
Like many companies, Chemtura saw order volumes decline sharply in
November and December as its customers experienced, or
anticipated, reductions in demand from the industries they serve.
These order reductions primarily related to Chemtura's Polymer
Additives and Performance Specialties business segments in
electronic, polyolefin, building and construction and general
industrial applications. With significant reductions in sales
volume and higher manufacturing variances, the company concludes
that it will report an operating loss for the fourth quarter,
2008. In light of this deterioration in financial performance, the
company requested, and its lenders have granted, a 90-day waiver
of its compliance with the financial maintenance covenants under
its senior credit facility.
In light of reduced demand and with the expectation the
implementation of an upgraded management system will improve the
efficiencies of business and management processes, Chemtura is
implementing the restructuring initiative it previously announced
on December 11, 2008, to reduce cash fixed costs by approximately
$50 million on an annualized basis. This initiative involves a
worldwide reduction in its professional and administrative staff
by approximately 500 staff, which represents a reduction of about
20% of the professional and administrative population.
The company is also adjusting its plant production rates to align
with customer demand and its inventory reduction goals and is
modifying work hours, furloughing or reducing production personnel
as required. As a result, a significant number of the company's
Polymer Additives facilities have been idled in the latter part of
December. These actions are providing additional cost reductions.
Production at these facilities will be restored as customer demand
dictates.
The changes in financial performance during the fourth quarter
2008 and the outlook in 2009 have led the company to conclude an
impairment has occurred to the carrying value of its goodwill.
The company will quantify and record a non-cash goodwill
impairment charge in its fourth quarter 2008 financial results,
together with charges related to its new restructuring program and
the expenses related to the above-mentioned amendment and waiver
agreements.
Chemtura expects to release its fourth quarter and full year
financial results in late February 2009.
Based in Middlebury, Connecticut, Chemtura Corporation --
http://www.chemtura.com/-- with 2007 sales of $3.7 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
CHESAPEAKE CORP: Mulls Feb. 24 Auction; Irving/Oaktree Lead Bidder
------------------------------------------------------------------
Chesapeake Corp and its affiliated debtors seek approval from the
U.S. Bankruptcy Court for the Eastern District of Virginia to sell
substantially all of their assets and businesses to entities
controlled by Irving Place Capital Management L.P., and Oaktree
Capital Management, L.P., or through another party providing for a
higher and better offer for the assets.
Chesapeake has already signed an asset purchase agreement with
Irving/Oaktree, under which Chesapeake will receive consideration
of $485 million, subject to reductions. Chesapeake, however, will
entertain competing bids for its assets, but will grant
Irving/Oaktree bid protections as stalking-horse bidder.
Chesapeake will conduct an auction on Feb. 24, 2009, if it timely
receives additional qualified bids for its assets.
Chesapeake engaged in negotiations with a number of parties
including holders of 70% of its subordinated notes regarding the
terms of a potential restructuring or sale. Chesapeake had
retained Goldman Sachs & Co., and Alvarez & Marsal prepetition to
help it evaluate alternatives.
Asset Purchase Agreement
The assets Irving/Oaktree's Baltimore US Inc., has proposed to
acquire include substantially all operating assets of the Debtors
and the outstanding capital stock or other equity securities of
Chesapeake's foreign subsidiaries.
The parties also agreed that the purchase price will be computed
based on the $485,000,0000 "transaction value" deducted by
$181,000,000 on account of foreign pension obligations and the
amounts outstanding under Chesapeake's prepetition credit
facility, which had Wachovia Bank, N.A., as admin. Agent., among
other things.
Baltimore US has agreed to purchase the company as a going concern
and have agreed to offer employment to all active employees of
Chesapeake.
Baltimore US may terminate the Agreement if the Bankruptcy Court
fails to approve the bid procedures by Jan. 12.
Irving Place Capital Management, L.P., OCM Principal Opportunity
Fund IV, L.P., and OCM European Principal Opportunity Fund II,
L.P. or their investing affiliates will be the equity sponsors of
Baltimore.
Proposed Bid Procedures
Chesapeake will market test the assets through an auction to make
sure that it will obtain the highest and best offer for the
assets. Chesapeake asks the Court to approve these procedures:
-- Interested parties must, by Feb. 12, 2009, and must, among
other things, sign a confidentiality agreement, and show
proof of financial ability to close the sale.
-- Potential bidders who have complied with the Feb. 12
requirements will be granted access to due diligence
materials.
-- Bidders must submit their initial bids by Feb. 20, 2009 at
12:00 p.m. to, among other parties,
A. Counsel for the Debtors,
Hunton & Williams LLP,
Riverfront Plaza, East Tower,
951 East Byrd Street,
Richmond, VA 23219
Attn: Benjamin C. Ackerly, Esq., and Hunton & Williams
200 Park Avenue, New York, NY 10166
Attn: Peter S. Partee, Esq.
B. Counsel for Irving/Oaktree
Kirkland and Ellis LLP,
153 East 53rd Street,
New York, NY 10022,
Attn: Michael T. Edsall, Esq. and Lisa
Laukitis, Esq., and McGuireWoods LLP, One James
Center, 901 East Cary Street,
Richmond, Virginia 23219,
Attn: Dion W. Hayes, Esq.
-- Minimum bids must exceed the purchase price offered by
Irving/Oaktree plus the break-up fee plus $5,000,000.
-- Irving/Oaktree will receive a $16 million break-up fee and
expense reimbursement of up to $5,000,000 if Chesapeake
completes a sale with another party. After the Court's
approval of the Bid Procedures, Irving/Oaktree will receive
$1,000,000 as security for the payment of postpetition
expenses plus $503,440 as an expense true-up for their
prepetition unpaid expenses.
-- If a qualified bid, in addition to Irving/Oaktree's is
timely received, an auction will be held on Feb. 24, 2009,
at the offices of Hunton & Williams in New York.
-- Chesapeake will seek approval of the sale to Irving/Oaktree
or the winning bidder at a hearing on Feb. 26, 2009.
The Bankruptcy Court will convene a hearing to consider approval
of the Bid Procedures on Jan. 12. Objections are due Feb. 9.
A copy of the Bid Protocol and the Irving/Oaktree APA is available
for free at:
http://bankrupt.com/misc/Chesapeake_Sale_Protocol_APA.pdf
About Chesapeake Corp.
Chesapeake Corporation protects and promotes the world's great
brands as a leading international supplier of value-added
specialty paperboard and plastic packaging. Headquartered in
Richmond, Va., the company is one of Europe's premier suppliers of
folding cartons, leaflets and labels, as well as plastic packaging
for niche markets. Chesapeake has 44 locations in Europe, North
America, Africa and Asia and employs approximately 5,400 people
worldwide.
As of September 30, 2008, Chesapeake's consolidated balance sheets
showed $936.4 million in total assets, including $340.7 million in
current assets; and $937.1 million in total liabilities, including
$469.2 million in current liabilities, resulting in $500,000 in
stockholders' deficit.
Chesapeake Corporation, and 18 affiliates filed Chapter 11
petitions (Bankr. E.D. Virginia, Lead Case No. 08-336642) on
Dec. 29, 2008. Benjamin C. Ackerly, Esq., Jason W. Harbour, Esq.,
Peter S. Partee, Esq., at Hunton & Williams LLP, are the proposed
bankruptcy counsel. Chesapeake has also tapped Alvarez and Marsal
North America LLC, and Goldman Sachs & Co. as financial advisors.
It also brought along Tavenner & Beran PLC as conflicts counsel
and Hammonds LLP as special counsel. Its claims agent is Kurtzman
Carson Consultants LLC.
CHESAPEAKE CORP: Court Sets March 30 as Claims Bar Date
-------------------------------------------------------
The Hon. Frank J. Santoro of the United States Bankruptcy
Court for the Eastern District of Virginia set March 30, 2009, as
deadline for creditors of Chesapeake Corporation and its debtor-
affiliates to file proofs of claim.
Deadline for all governmental units is 180 days after the Debtors'
bankruptcy filing.
About Chesapeake Corporation
Headquartered in Richmond, Virginia, Chesapeake Corporation (NYSE:
CSK) -- http://www.cskcorp.com-- supplies specialty paperboard
packaging products in Europe and an international supplier of
plastic packaging products to niche end-use markets. The Debtors
have 44 locations in Europe, North America, Africa and Asia and
employs approximately 5,400 people worldwide. The company
directly owns 100% of each of the other Debtors.
The company owns, directly or indirectly, 100% of each of the non-
debtor subsidiaries except: (i) Chesapeake Plastics Kft, a
Hungarian joint venture which is 49% owned by Chemark Kft; and
(ii) Rotam Boxmore Packaging Co. Ltd., a British Virgin Islands
company which is 50% owned by Canada Rotam International Co. Ltd.
The company's certificate of authorization authorizes the issuance
of 60,000,000 shares of common stock. About 20,559,115 shares of
common stock are issued and outstanding with par value of $1.00
per share as of Dec. 26, 2008. Moreover, the company's
certificate allows the issuance of 500,000 shares of preferred
stock, and no shares are outstanding.
As of Dec. 31, 2007, Dimensional Fund Advisors LLP owns 7.98% of
the company; T. Rowe Price Associates Inc., 8.4%; and Wells Fargo
& Company, 14.71%. Edelmann GmbH & Co. KG and Joachim W. Dziallas
owns 13.5% of the company as of Sept. 19, 2008.
New York Stock Exchange suspended the listing of the company's
common stock effective Oct. 8, 2008, due to its inability to meet
the global market capitalization requirements for continued
listing on the exchange. Subsequently, the company's stock began
to be quoted on the over-the-counter bulletin board under the
trading symbol "CSKE.PK."
The company and 18 of its affiliates filed for Chapter 11
protection on Dec. 29, 2008 (Bankr. E.D. Va. Lead Case No.
08-36642). Benjamin C. Ackerly, Esq., Jason W. Harbour, Esq., and
Peter S. Partee, Esq., at Hunton & Williams LLP, represent the
Debtors in their restructuring efforts. The Debtors proposed
Alvarez and Marsal North America LLC, and Goldman Sachs & Co. as
financial advisor; Tavenner & Beran PLC as conflicts counsel;
Kurtzman Carson Consultants LLC as claims agent; and Hammonds LLP
as special counsel. When the Debtors filed for protection from
their creditors, they listed $936,600,000 in total assets and
$937,100,000 in total debt as of Sept. 28, 2008.
CHESAPEAKE CORP: U.S. Trustee Forms Seven-Member Creditor Panel
---------------------------------------------------------------
The United States Trustee for Region 4 appointed seven creditors
to serve on an Official Committee of Unsecured Creditors for the
Chapter 11 cases of Chesapeake Corporation and its debtor-
affiliates.
The creditors committee members are:
a) US Bank National Association, as Indenture
Trustee
Attn: Sandra Spivey
2300 West Sahara- 2nd Floor
Las Vegas, NV 89102
Tel: (702) 291-1696
Fax: (702) 291-1657
sandra.spivey@usbank.com
b) The Bank of New York Mellon
Attn: Donna J. Parisi
6525 West Campus Oval
New Albany, OH 43054
Tel: (614) 775-5279
Fax: (614) 775-5636
donna.parisi@bnymellon.com
c) Peter R. Chiericozzi
2255 Oregon Rd
Salvisa, KY 40372
Tel & Fax: (859) 865-1114
pbasn@aol.com
d) Thomas H. Johnson
P.O. Box 421549
Atlanta, GA 30342
Tel: (770) 955-3483
Fax: (770) 955-3061
thjoh@att.net
e) Samual J. Taylor
2900 Park Ridge Rd
Midlothian, VA 23113
Tel: (804) 330-4166
sjandcj@verizon.net
f) Robert S. Argabright, II
8011 River Rd.
Richmond, VA 23229
Tel: (804) 288-3287
Fax: (804) 288-1966
rargabright@verizon.net
g) Jack L. Creech
2291 Charleston Place
Richmond, IN 47374
Tel: (765) 966-4701
marjack85@aol.com
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense. They may investigate the Debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
About Chesapeake Corporation
Headquartered in Richmond, Virginia, Chesapeake Corporation (NYSE:
CSK) -- http://www.cskcorp.com-- supplies specialty paperboard
packaging products in Europe and an international supplier of
plastic packaging products to niche end-use markets. The Debtors
have 44 locations in Europe, North America, Africa and Asia and
employs approximately 5,400 people worldwide. The company
directly owns 100% of each of the other Debtors.
The company owns, directly or indirectly, 100% of each of the non-
debtor subsidiaries except: (i) Chesapeake Plastics Kft, a
Hungarian joint venture which is 49% owned by Chemark Kft; and
(ii) Rotam Boxmore Packaging Co. Ltd., a British Virgin Islands
company which is 50% owned by Canada Rotam International Co. Ltd.
The company's certificate of authorization authorizes the issuance
of 60,000,000 shares of common stock. About 20,559,115 shares of
common stock are issued and outstanding with par value of $1.00
per share as of Dec. 26, 2008. Moreover, the company's
certificate allows the issuance of 500,000 shares of preferred
stock, and no shares are outstanding.
As of Dec. 31, 2007, Dimensional Fund Advisors LLP owns 7.98% of
the company; T. Rowe Price Associates Inc., 8.4%; and Wells Fargo
& Company, 14.71%. Edelmann GmbH & Co. KG and Joachim W. Dziallas
owns 13.5% of the company as of Sept. 19, 2008.
New York Stock Exchange suspended the listing of the company's
common stock effective Oct. 8, 2008, due to its inability to meet
the global market capitalization requirements for continued
listing on the exchange. Subsequently, the company's stock began
to be quoted on the over-the-counter bulletin board under the
trading symbol "CSKE.PK."
The company and 18 of its affiliates filed for Chapter 11
protection on Dec. 29, 2008 (Bankr. E.D. Va. Lead Case No.
08-36642). Benjamin C. Ackerly, Esq., Jason W. Harbour, Esq., and
Peter S. Partee, Esq., at Hunton & Williams LLP, represent the
Debtors in their restructuring efforts. The Debtors proposed
Alvarez and Marsal North America LLC, and Goldman Sachs & Co. as
financial advisor; Tavenner & Beran PLC as conflicts counsel;
Kurtzman Carson Consultants LLC as claims agent; and Hammonds LLP
as special counsel. When the Debtors filed for protection from
their creditors, they listed $936,600,000 in total assets and
$937,100,000 in total debt as of Sept. 28, 2008.
CHRISTOPHER TAYLOR: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Christopher R. Taylor
20875 N. Pima Road, #04
Scottsdale, AZ 85255
Bankruptcy Case No.: 08-19088
Chapter 11 Petition Date: December 31, 2008
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: George B. Nielsen Jr.
Debtor's Counsel: Robert M. Cook, Esq.
Law Offices of Robert M. Cook PLLC
219 W. Second Street
Yuma, AZ 85364
Tel.: (928) 782-7771
Fax : (928) 782-7778
Email: robertmcook@yahoo.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/azb08-19088.pdf
The petition was signed by Christopher R. Taylor.
CLEAR CHANNEL: Bank Loan Sells at Substantial Discount
------------------------------------------------------
Participations in a syndicated loan under which Clear Channel
Communications is a borrower traded in the secondary market at
49.80 cents-on-the-dollar during the week ended January 2, 2009,
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. This represents a drop of 1.87
percentage points from the previous week, the Journal relates.
Clear Channel Communications pays interest at 365 points above
LIBOR. The bank loan matures on December 30, 2015. The bank loan
carries Moody's B1 rating and Standard & Poor's B rating.
According to Standard & Poor's, Clear Channel is the No. 1 radio
operator in the U.S., in terms of revenue and number of stations,
and it has approximately a 90% ownership interest (through Clear
Channel Holdings) in Clear Channel Outdoor Inc., the largest
global outdoor advertiser. Clear Channel's radio segment has
significant geographic and format diversity, and is ranked No. 1
or No. 2 in terms of market share in all of the top 10 markets and
in roughly 70% of the top 25 markets.
Clear Channel Communications is the operating subsidiary of San
Antonio, Texas-based CC Media Holdings Inc.
CONSTAR INTL: Court OKs $75MM DIP Loan, Other "First Day" Motions
-----------------------------------------------------------------
Constar International Inc. received approval of its operational
"first day" motions by the U.S. Bankruptcy Court for the District
of Delaware on December 31, 2008. The company received, among
other things, interim Bankruptcy Court approval of its
$75 million debtor-in-possession financing. The DIP financing
includes the option for the company to convert it into a three-
year exit financing facility, subject to satisfying certain
conditions. The DIP and exit financing are being provided by the
company's existing bank lenders. Constar will use the interim DIP
financing and cash generated from its operations to continue to
pay vendors and to provide operational and financial stability as
it proceeds with its restructuring. The final DIP hearing is
scheduled for January 20, 2009.
The company also announced that it received Bankruptcy Court
approval to, among other things, pay pre-petition employee wages,
health benefits and other employee obligations during its
restructuring under Chapter 11. Additionally, the company is
authorized to pay its ordinary course of business post-petition
expenses and to continue to honor all of its current customer
contracts without seeking further Bankruptcy Court approval.
"With the prompt approval of our DIP and exit financing and first
day motions, we are moving forward while maintaining normal
operations," said Michael Hoffman, President and Chief Executive
Officer of Constar. "Throughout this process, we will continue to
operate our business without interruption, including paying
employee wages and purchasing the goods and services necessary to
provide our customers with high quality PET containers and
dependable service."
About Constar International
Philadelphia-based Constar International Inc. (NASDAQ: CNST) --
http://www.constar.net/-- produces polyethylene terephthalate
plastic containers for food, soft drinks and water. The company
provides full-service packaging services. The company and five of
its debtor-affiliates filed separate petitions for Chapter 11
relief on Dec. 30, 2008 (Bankr. D. Del. Lead Case No. 08-13432).
Andrew N. Goldman, Esq., and Eric R. Markus, Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP are the Debtors' proposed
counsel. Neil B. Glassman, Esq., and Jamie Edmonson, Esq., at
Bayard, P.A., are Debtors' proposed Delaware counsel. The Debtors
selected Greenhill & Co., LLC as their financial advisor and
investment banker. On Dec. 31, 2008, the Court approved the
employment of Epiq Bankruptcy Solutions, LLC as the Debtors'
claims, noticing and balloting agent. In its petition, Constar
International, Inc. listed total assets of $420,000,000 and total
debts of $538,000,000 as at Nov. 30, 2008.
The Debtors filed a Joint Chapter 11 Plan of Reorganization and a
Disclosure Statement explaining that Plan together with their
bankruptcy petitions. The Debtors expect to emerge from Chapter
11 as early as Feb. 28, 2009, or at the latest, by March 30, 2009.
On the Petition Date, the Debtors promptly requested that the U.S.
Bankruptcy Court for the District of Delaware set a hearing date
to approve the Disclosure Statement explaining their Joint Chapter
11 Plan of Reorganization and to confirm the Plan. If the Plan is
confirmed, the Effective date of the Plan is projected to be
approximately 10 days after the date the Court enters the
Confirmation order.
CONSTAR INTL: Receives Delisting Notice from NASDAQ
---------------------------------------------------
Constar International Inc., was given a notice by The NASDAQ Stock
Market on December 30, 2008, that in connection with the Company's
filing of Chapter 11 cases that day, and in accordance with
Marketplace Rules 4300, 4450(f) and IM-4300, the Nasdaq staff
determined that the Company's common stock will be delisted from
The Nasdaq Stock Market. Trading will be suspended at the opening
of business on January 8, 2009. The Company does not intend to
appeal the Nasdaq staff's determination and therefore expects that
the Company's common stock will be delisted after completion by
Nasdaq of application to the Securities and Exchange Commission.
About Constar International
Philadelphia-based Constar International Inc. (NASDAQ: CNST) --
http://www.constar.net/-- produces polyethylene terephthalate
plastic containers for food, soft drinks and water. The company
provides full-service packaging services. The company and five of
its debtor-affiliates filed separate petitions for Chapter 11
relief on Dec. 30, 2008 (Bankr. D. Del. Lead Case No. 08-13432).
Andrew N. Goldman, Esq., and Eric R. Markus, Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP are the Debtors' proposed
counsel. Neil B. Glassman, Esq., and Jamie Edmonson, Esq., at
Bayard, P.A., are Debtors' proposed Delaware counsel. The Debtors
selected Greenhill & Co., LLC as their financial advisor and
investment banker. On Dec. 31, 2008, the Court approved the
employment of Epiq Bankruptcy Solutions, LLC as the Debtors'
claims, noticing and balloting agent. In its petition, Constar
International, Inc. listed total assets of $420,000,000 and total
debts of $538,000,000 as at Nov. 30, 2008.
The Debtors filed a Joint Chapter 11 Plan of Reorganization and a
Disclosure Statement explaining that Plan together with their
bankruptcy petitions. The Debtors expect to emerge from Chapter
11 as early as Feb. 28, 2009, or at the latest, by March 30, 2009.
On the Petition Date, the Debtors promptly requested that the U.S.
Bankruptcy Court for the District of Delaware set a hearing date
to approve the Disclosure Statement explaining their Joint Chapter
11 Plan of Reorganization and to confirm the Plan. If the Plan is
confirmed, the Effective date of the Plan is projected to be
approximately 10 days after the date the Court enters the
Confirmation order.
DHP HOLDINGS: Organizational Meeting to Form Panel on January 9
---------------------------------------------------------------
Roberta A. DeAngelis, the Acting United States Trustee for Region
3, will hold an organizational meeting on January 9, 2009, at
10:00 a.m. in the bankruptcy cases of bankruptcy cases of DHP
Holdings II Corporation. The meeting will be held at J. Caleb
Boggs Federal Building 844 King Street, Room 2112, in Wilmington,
Delaware.
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtor's cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
Headquartered in Bowling Green, Kentucky, DHP Holdings II
Corporation is the parent of DESA Heating, which sells and
distributes heating commercial products in Europe and Mexico under
brand names including ReddyHeater, Comfort Glow and Master
Portable Heaters. The company has manufacturing, storage and
distribution facilities in Alabama and California.
DHP Holdings II and six of its affiliates filed for Chapter 11
protection on December 29, 2008 (Bankr. D. Del. Lead Case No. 08-
13422). The company's international arm, HIG-DHP Barbados, has
not filed for bankruptcy. HIG-DHP Barbados holds 100% of the
equity of all foreign nondebtor subsidiaries, which manufacture,
distribute and sell commercial and consumer goods in Europe,
Mexico, and Canada.
Bruce Grohsgal, Esq., Laura Davis Jones, Esq., and Timothy P.
Cairns, Esq., at Pachulski, Stang, Ziehl Young & Jones LLP,
represent the Debtors. The Debtor proposed AEG Partners as
restructuring consultants, and Craig S. Dean as chief
restructuring officer and Kevin Willis as assistant chief
restructuring officer. The Debtora also proposed Epiq Bankruptcy
Solutions LLC as claims agent. When the Debtors filed for
protection from their creditors, they listed assets and debts
between $100 million to $500 million each. According to Reuters,
as of Nov. 29, the company, along with its nondebtor subsidiaries
and affiliates, had assets of $132.5 million and liabilities of
$133.2 million.
DESA Holdings Corporation and DESA International LLC filed
voluntary petitions on June 8, 2002. HIG-DESA Acquisition nka
DESA LLC acquired on Dec. 13, 2002, substantially all assets of
the DESA Entities for $198 million comprised of $185 million in
cash plus unsecured subordinated notes in the original aggregate
amount of $13 million priced at 10% per annum due payable on
Dec. 24, 2007. The sale closed on Dec. 24, 2002.
The Chapter 11 cases of the form DESA Entities is still
active; However, activity occurring in those cases consists of
limited claims resolution, and required filing of necessary
postconfirmation reports and payment of postconfirmation fees. No
claims of ther issues remain open between the Debtors and the
former DESA Entities.
According to the Troubled company Reporter on April 22, 2005,
the Hon. Walter Shapero of the United States Bankruptcy Court
for the District of Delaware confirmed the Second Amended Joint
Plan of Liquidation of DESA Holdings Corporation and its debtor-
affiliate -- DESA International LLC. The Court confirmed the Plan
on April 1, 2005, and Plan took effect the same day.
Kirkland & Ellis, LLP, and Pachulski, Stang, Ziehl Young Jones &
Weintraub, P.C., represented the DESA entities.
DREIER LLP: U.S. Trustee Picks Sheila Gowan as Chapter 11 Trustee
-----------------------------------------------------------------
The United States Trustee for Region 2, Diana Adams, asked the
Hon. Stuart Bernstein of the United States Bankruptcy Court for
the Southern District of New York for permission to appoint
Diamond McCarthy partner Sheila M. Gowan as Chapter 11 trustee to
oversee the Chapter 11 bankruptcy case of Dreier LLP, Joel
Rosenblatt of Bloomberg News reports.
The Troubled Company Reporter said on Dec. 19, 2008, Mark F.
Pomerantz, the appointed receiver for Marc Dreier's assets
including his interest in Dreier LLP and other entities, declined
to be a candidate to serve as Chapter 11 trustee for the firm's
estates.
Mr. Pomerantz was named receiver after the Securities and Exchange
Commission filed charges and asked the District Court to freeze
the firm's assets. He placed the firm in Chapter 11 before the
Court, saying an "orderly liquidation" could not take place
otherwise. He asked the Court to appoint a Chapter 11 trustee to
oversee the liquidation of the Debtor.
Marc Dreier's Arrest for Fraud
To recall, the United States Attorney for the Southern District of
New York filed a criminal complaint alleging that Mr. Dreier
committed securities and wire fraud. The Federal authorities
arrested Mr. Dreier on Dec. 7, 2008. The criminal complaint was
unsealed and Mr. Dreier was presented before a United States
Magistrate judge the following day. Mr. Dreier has been ordered
detained pending trial.
Mr. Dreier was earlier arrested on Dec. 2, 2008, by the Canadian
authorities for impersonating a lawyer with the Ontario Teachers'
Pension Fund but he was bailed on the charges three days later.
On Dec. 8, 2008, the U.S. Securities and Exchange Commission filed
a suit, alleging that Mr. Dreier made fraudulent offers and sales
of securities in several cities, selling fake promissory notes to
hedge and other private investment funds. The SEC asserted that
Mr. Dreier also distributed phony financial statements and audit
opinions, and recruited accomplices in connection with that
scheme.
Moreover, Wachovia Bank N.A. said it wants to recover cash the
firm owed under a $14.5 million credit agreement and seeks to
foreclose on its collateral for the loan. According to the bank,
the complaint alleges default under a term note and a revolving
credit note issued under the agreement that make the entire
outstanding amount due and payable.
The bank asserted that it is entitled to foreclose on its alleged
security interest in and lien on all accounts of the firm --
including accounts receivable, and general intangibles consist of
unbilled time and disbursements of the firm.
About Dreier LLP
Headquartered in New York, Dreier LLP -- http://www.dreierllp.com/
-- is a law firm, which was found in 1996 by Marc Dreier. Dreier
LLP filed for Chapter 11 on Dec. 16, 2008 (Bankr. S. D. N.Y., Case
No. 08-15051). Judge Robert E. Gerber handles the case. Stephen
J. Shimshak, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison
LLP, has been retained as counsel. The Debtor listed assets
between $100 million to $500 million, and debts between $10
million to $50 million in its filing.
EAST CAMERON: Court Denies Heller as Attys. to Non-Debtor Unit
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Louisiana
denied East Cameron Partners, LP's request to employ Heller,
Draper, hayton, Patrick & Horn, LLC as special counsel to
Louisiana Offshore Holding, LLC.
The Court ruled that although the Debtor holds a 100% ownership
interest in Louisiana Offshore Holding, LLC, LOH is a distinct
legal entity that is not a debtor in the case. The Court states
that while the Debtor has filed an adversary proceeding seeking to
bring certain assets of LOH within the bankruptcy estate, the
Debtor has not established any grounds for disregarding the
separate existence of LOH -- a defendant in the adversary
proceeding -- at this point in the case.
In addition, the Court says, although the Debtor is responsible
for managing the business and affairs of LOH pursuant to LOH's
Limited Liability Company Agreement, the Debtor's authority to act
on behalf of LOH is limited by the LLC Agreement, which gives
Frank Bilotta, LOH's "Independent Member", certain powers to act
on behalf of and in the name of LOH. Mr. Bilotta has objected to
the Application, and contends that interests of LOH in the
adversary proceeding are adverse to the estate.
As reported in the Troubled Company Reporter on Oct. 17, 2008, the
Debtor asked the Court to issue a temporary injunction to stop
investors and lenders from taking away its assets held on paper by
what's referred to as a "bankruptcy remote vehicle."
The Debtor said that prior to filing for bankruptcy it obtained
refinancing through a "sukuk," an issued bond that complies with
Islamic Shariah religious law. East Cameron Gas Co., a "sukuk-
issuing" special purpose vehicle of the Debtor, issued $165.67
million in sukuk certificates and then advanced the proceeds to
Louisiana Offshore Holding, LLC. An overriding royalty interest
collateralized the sukuk offering.
The Debtor wanted the Court to rule that the overriding royalty
interest in the properties belongs to it and not to related
entities that aren't in bankruptcy.
Based in Lafayette, Louisiana, East Cameron Partners, LP --
http://www.eastcameronpartners.com/-- is an independent oil and
gas exploration and production company. The company filed for
Chapter 11 relief on Oct. 16, 2008 (Bankr. W.D. La. Case No.
08-51207). Benjamin W. Kadden, Esq., Christopher T. Caplinger,
Esq., and Stwart F. Peck, Esq., at Lugenbuhl, Wheaton, Peck,
Rankin & Hubbard, represent the Debtor as counsel. When the
Debtor filed for protection from its creditors, it listed assets
and debts of more than $100 million each.
EAST CAMERON: Files Schedules of Assets and Liabilities
-------------------------------------------------------
East Cameron Partners, LP, filed with the U.S. Bankruptcy Court
for the Western District of Louisiana its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- ------------
A. Real Property Unknown
B. Personal Property $12,830,525
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $161,580,562
E. Creditors Holding
Unsecured Priority
Claims
F. Creditors Holding
Unsecured Non-priority
Claims $2,248,220
----------- ------------
TOTAL Unknown $163,828,782
Based in Lafayette, Louisiana, East Cameron Partners, LP --
http://www.eastcameronpartners.com/-- is an independent oil and
gas exploration and production company. The company filed for
Chapter 11 relief on Oct. 16, 2008 (Bankr. W.D. La. Case No.
08-51207). Benjamin W. Kadden, Esq., Christopher T. Caplinger,
Esq., and Stwart F. Peck, Esq., at Lugenbuhl, Wheaton, Peck,
Rankin & Hubbard, represent the Debtor as counsel. When the
Debtor filed for protection from its creditors, it listed assets
and debts of more than $100 million each.
EAST CAMERON: U.S. Trustee Appoints 5-Member Creditors Committee
----------------------------------------------------------------
R. Michael Bolen, the United States Trustee for Region 5,
appointed five creditors to serve on the Official Committee of
Unsecured Creditors in East Cameron Partners LP's Chapter 11 case.
The Creditors Committee members are:
a) Halliburton Energy Services, Inc.
Attn: Tony L. Singer
10200 Bellaire Boulevard
25E-26B
Houston, TX 77072-5299
Tel: (713) 409-5834
b) Energy Logistics, Inc.
Attn: Richard E. Johnston
401 Whitney Avenue, Suite 135
Gretna, LA 70056
Tel: (504) 366-5553
Fax: (504) 366-5559
c) Pride International, Inc.
Attn: Stephen D. Oldham
5847 San Felipe, Suite 3300
Houston, TX 77057
Tel: (713) 789-1400
Fax: (713) 278-4430
d) Candy Fleet Corporation
Attn: Kenneth I. Nelkin
P.O. Box 2444
Morgan City, LA 70381
Tel: (985) 384-5835
Fax: (985) 384-2721
e) Energy Cranes, LLC
Attn: William R. Williams
6707 Northwinds Drive
Houston, TX 77041
Tel: (713) 896-0002
Fax: (713) 896-5105
Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtor's expense. They may investigate the Debtor's business
and financial affairs. Importantly, official committees serve
as fiduciaries to the general population of creditors they
represent. Those committees will also attempt to negotiate the
terms of a consensual Chapter 11 plan -- almost always subject
to the terms of strict confidentiality agreements with the
Debtors and other core parties-in-interest. If negotiations
break down, the Committee may ask the Bankruptcy Court to
replace management with an independent trustee. If the
Committee concludes reorganization of the Debtor is impossible,
the Committee will urge the Bankruptcy Court to convert the
Chapter 11 cases to a liquidation proceeding.
Based in Lafayette, Louisiana, East Cameron Partners, LP --
http://www.eastcameronpartners.com/-- is an independent oil and
gas exploration and production company. The company filed for
Chapter 11 relief on Oct. 16, 2008 (Bankr. W.D. La. Case No.
08-51207). Benjamin W. Kadden, Esq., Christopher T. Caplinger,
Esq., and Stwart F. Peck, Esq., at Lugenbuhl, Wheaton, Peck,
Rankin & Hubbard, represent the Debtor as counsel. When the
Debtor filed for protection from its creditors, it listed assets
and debts of more than $100 million each.
ELECTRICAL COMPONENTS: Moody's Downgrades Credit Ratings to 'Caa3'
------------------------------------------------------------------
Moody's Investors Service downgraded Electrical Components
International, Inc.'s Corporate Family and Probability of Default
Rating to Caa3 from Caa2. Moody's downgraded the company's senior
secured bank credit facility to Caa2 from Caa1 and its second lien
term loan to Ca from Caa3. The outlook is negative.
The downgrades reflect the company's operating performance below
Moody's expectations as the result of the continued economic
pressures that ECI faces from the severe downturn in the domestic
and Western European housing markets, the main drivers of the
company's revenues. Deteriorating sales of white goods are likely
to further constrain demand well into 2009 for the company's wire
harnesses, which are used in various household appliances and
industrial products. The negative trend in operating performance
is expected to result in future credit metrics more commensurate
with the lower rating. Even though ECI amended its covenants in
September 2008, Moody's believes that the deterioration in the
company's operating performance will likely result in further
pressure on covenant compliance under the bank credit facilities,
especially as the leverage covenant becomes more restrictive
beginning with 1Q09.
The negative outlook anticipates the continued weakening of ECI's
credit metrics as it contends with the global economic turmoil and
the resulting severity in the domestic and Western European
housing markets.
These ratings/assessments were affected by this action:
-- Corporate family rating lowered to Caa3 from Caa2;
-- Probability of default lowered to Caa3 from Caa2;
-- $264 million senior secured bank credit facility downgraded
to Caa2 from Caa1, but its loss given default assessment
remains (LGD3, 38%); and,
-- $60 million second lien term loan due 2014 downgraded to Ca
from Caa3, but its loss given default assessment remains
(LGD5, 80%).
The last rating action was on October 29, 2008 at which time
Moody's confirmed ECI's corporate family rating at Caa2.
Electrical Components International, Inc., headquartered in St.
Louis, Missouri, designs, manufactures and markets wire harnesses
and provides assembly services primarily for major white goods
appliance manufacturers in North America and Europe.
EOS AIRLINES: Court Approves Adequacy of Disclosure Statement
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved on Dec. 18, 2008, the adequacy of the disclosure
statement explaining Eos Airlines, Inc. and the Official Committee
of Unsecured Creditors' Joint Plan of Liquidation.
Following approval of the Disclosure Statement, Eos Airlines may
begin soliciting votes on, and subsequently seek confirmation of,
the Plan.
The voting deadline has been set for Jan. 21, 2009, at 5:00 p.m.,
Pacific Time, and the hearing on confirmation of the Plan has been
set for Jan. 28, 2009, at 11:00 a.m., Eastern Time.
Objections to the Plan must be filed with the Court so as to be
served no later than 4:00 p.m., Eastern Time, on Jan. 23, 2009.
Plan Summary
On the Effective Date of the Plan, a liquidating trustee will be
appointed to liquidate all of the Debtor's remaining non-cash
assets, if any, and to distribute the Debtor's cash assets, net of
the costs of administration, to the Debtor's creditors in
accordance with the Bankruptcy Code and the Plan.
Pursuant to the Plan, all equity interests in the Debtor will be
cancelled, terminated, extinguished and void. Interest holders
will neither receive nor retain any property on account of their
Equity Interests under the Plan, are deemed to reject the Plan,
and are not entitled to vote to accept or reject the Plan.
Holders of equity related claims will likely receive no
distribution under the Plan and are, therefore, deemed to have
rejected the Plan.
Secured Claims will receive (i) the collateral securing the claim;
(ii) if the collateral is sold for cash, proceeds in the amount of
the allowed claim; or (iii) other consideration as is necessary to
render the allowed secured claim as unimpaired.
Allowed priority non-tax claims will be paid by the Liquidating
Trustee from cash held by the Trust within 10 days after the
allowance date.
Allowed unsecured Warn Act claims will be treated in accordance
with the terms of the settlement agreement reached by the parties.
Holders of Unclassified Claims, Secured Claims, and Allowed
Priority Non-Tax Claims are unimpaired under the Plan and are
deemed to have accepted the Plan without voting. Holders of
Allowed Unsecured WARN Act Claims are deemed to have accepted the
Plan.
Each holder of an allowed general unsecured claim in Class 4 will
receive its pro rata share of the available cash on each
distribution date until the Trust has been fully administered, all
Estate Property completely liquidated and all resulting Trust Cash
Distributed. For purposes of the Plan, and in accordance with the
Bankruptcy Code, holders of General Unsecured Claims are impaired
and is the only Class entitled to vote on the Plan.
The Debtor and the Committee believe that the transactions
contemplated by the Plan will yield a recovery to creditors
greater than the return that could be achieved through other
liquidation alternatives or liquidation under Chapter 7 of the
Bankruptcy Code.
Claims and Equity Interests
The Plan segregates the claims and equity interests into 5
classes:
Class 1 - Secured Claims Unimpaired Not entitled to
Claims vote. Deemed to
accept the Plan.
Class 2 - Allowed Priority Unimpaired Non entitled to
Non-Tax Claims vote. Deemed to
accept the Plan.
Class 3 - Allowed Unsecured Impaired Entitled to vote.
WARN Act Claims Pursuant to the
Terms of the WARN
Act Settlement
Agreement, holders
of Allowed WARN Act
Claims are deemed to
have voted in favor
of the Plan.
Class 4 - General Unsecured Impaired Entitled to vote on
Claims the Plan.
Class 5 - Equity Interests Impaired Not entitled to vote.
and Equity Deemed to reject the
Related Claims Plan.
Cramdown
If the Plan is not accepted by all impaired classes of allowed
claims or equity interests, the Debtor reserves the right to ask
the Court to confirm the Plan under Sec. 1129(b) of the Bankruptcy
Code.
A full-text copy of the Disclosure Statement in support of EOS
Airlines, Inc. and the Official Committee of Unsecured Creditors'
Joint Plan of Liquidation is available for free at:
http://bankrupt.com/misc/EOSAirlines_DS.pdf
About EOS Airlines
Based in Purchase, New York, EOS Airlines, Inc. --
http://www.eosairlines.com/-- is a transatlantic airline. The
company filed for Chapter 11 relief on April 26, 2008 (Bankr.
S.D.N.Y. Case No.08-22581). Tim J. Robinson, Esq., and Nicholas
J. Brannick, Esq., at Squire, Sanders & Dempsey L.L.P., in
Columbus, Ohio; and Christine M. Pierpont, Esq., at Squire,
Sanders & Dempsey L.L.P, in Cleveland, Ohio, represent the Debtor
as counsel. Kurztman Carson Consultants LLC acts as the Official
Claims Agent for the maintenance and recordation of claims. The
U.S. Trustee for Region 2 appointed creditors to serve on an
Official Committee of Unsecured Creditors. Joseph M. Vann, Esq.,
and Robert A. Boghosian, Esq., at Cohen Tauber Spievack & Wagner
P.C., in New York, represent the Creditors Committee as counsel.
Alvarez & Marsal in New York is the Financial Advisor for the
Debtor.
Menzies Corporate Restructuring has been appointed as joint
administrators in the U.K.
In its schedules, EOS Airlines, Inc. listed total assets of
$57,707,999 and total debts of $16,409,993.
FLAGSTAR BANK: Moody's Withdraws 'D+' Financial Strength Rating
---------------------------------------------------------------
Moody's Investors Service withdrew its ratings for Flagstar Bank,
FSB (bank financial strength at D+, deposits at Ba1/Not-Prime) for
business reasons.
Flagstar Bancorp, Inc., headquartered in Troy, Michigan, reported
total assets of $14.2 billion at September 30, 2008.
The last rating action was on January 5, 2009 when the ratings
were confirmed and a negative outlook was assigned.
Outlook Actions:
Issuer: Flagstar Bank, FSB
-- Outlook, Changed To Rating Withdrawn From Negative
Withdrawals:
Issuer: Flagstar Bank, FSB
-- Bank Financial Strength Rating, Withdrawn, previously rated
D+
-- Issuer Rating, Withdrawn, previously rated Ba1
-- OSO Rating, Withdrawn, previously rated NP
-- Deposit Rating, Withdrawn, previously rated NP
-- OSO Senior Unsecured OSO Rating, Withdrawn, previously rated
Ba1
-- Senior Unsecured Deposit Rating, Withdrawn, previously rated
Ba1
GENERAL GROWTH: Settles Caruso Suit for $48-Mil.
------------------------------------------------
General Growth Properties, Inc. (NYSE:GGP) said that the lawsuit
brought by Caruso Affiliated Holdings LLC relating to Glendale
Galleria, a California mall owned by the company's GGP/Homart II
joint venture, has been settled for $48 million. The company will
not be reimbursed for any portion of this payment by its 50% joint
venture partner in GGP/Homart II, and it will also reimburse
$5.5 million of costs to the joint venture partner in connection
with the settlement.
The lawsuit, which was being appealed by General Growth, was
commenced by Caruso in February 2004 and resulted in a judgment of
$89.2 million in compensatory and punitive damages in December
2007. The company paid the settlement and costs using a portion
of the cash collateral held as security for the appeal.
As a result of the settlement, previously recorded expenses equal
to the judgment amount and certain related expenses will be
reversed to the extent necessary to reflect the settlement. The
adjustments will result in an increase in Funds From Operations of
approximately $0.16 per fully diluted share and an increase in
earnings per share - diluted of approximately $0.19 for the fourth
quarter of 2008.
Adam Metz, interim Chief Executive Officer of General Growth,
stated that, "Settlement allows us to put this matter behind us
and focus on the Company's ongoing operations and
strategic evaluations."
GGP also announced that MB Capital Units LLC, pursuant to the
Rights Agreement dated July 27, 1993, converted 42,350,000 common
partnership units held in the company's operating partnership, GGP
Limited Partnership, into 42,350, 000 shares of GGP common stock.
As a result of this conversion, there are approximately
311.3 million shares of GGP common stock issued and outstanding.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc.
(NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S.
mall owner with 200-plus shopping malls in 44 states. General
Growth is a self-administered and self-managed real estate
investment trust. General Growth owns, manages, leases and
develops retail rental property, primarily shopping centers.
Substantially all of its properties are located in the United
States, but the company also has retail rental property operations
and property management activities -- through unconsolidated joint
ventures -- in Brazil and Turkey. Its Master Planned Communities
segment includes the development and sale of residential and
commercial land, primarily in large-scale projects in and around
Columbia, Maryland; Houston, Texas; and Summerlin, Nevada, as well
as the development and sale of its one residential condominium
project located in Natick (Boston), Massachusetts.
General Growth said in a regulatory filing Sept. 30 that its
potential inability to address its 2008 or 2009 debt maturities in
a satisfactory fashion raises substantial doubts as to its ability
to continue as a going concern. General Growth had
$29.6 billion in total assets and $27.3 billion in total
liabilities as at Sept. 30.
* * *
As reported by the Troubled Company Reporter on Dec. 11, 2008,
Fitch Ratings, has downgraded the Issuer Default Ratings and
outstanding debt ratings of General Growth Properties to 'C' from
'B'.
GENERAL MOTORS: December Deliveries Down 31% from 2007 Levels
-------------------------------------------------------------
General Motors dealers in the United States delivered 221,983
vehicles in December, down 31 percent compared with a year ago.
However, total deliveries were 67,000 vehicles more than
November's result, up more than 43 percent month over month. GM
December car sales of 87,506 were off 25 percent and truck sales
of 134,477 were down 35 percent compared with a year ago.
For the year, GM delivered 2,980,688 vehicles while maintaining an
expected market share just above 22 percent. Annual deliveries
were down 23 percent compared with 2007, largely due to building
weakness in the marketplace throughout the year spurred by
economic headwinds such as the dramatic reduction in credit
availability experienced in the fourth quarter, coupled with
historically low levels of consumer confidence. Additionally, the
American Axle strike and several supply disruptions impacted GM's
performance in the first half of the year.
"Given the ongoing challenges and the difficult market
environment, we were very encouraged to see a volume rebound for
GM in December compared with both October and November," said Mark
LaNeve, vice president, GM North America Vehicle Sales, Service
and Marketing. "We are building more vehicles than ever that
provide great value and Americans enjoy owning. That is why, for
the year, we are seeing our market share holding steady at just
above 22 percent. That's 5 percentage points more and 760,000
vehicles more than our nearest competitor.
"Our outstanding cars, trucks and crossovers are enabling us to
hold the leadership position in a very difficult market. Our Red
Tag Event was well-received, and the ability to offer some 0%
financing through our partner GMAC in the last week of the month
also helped," LaNeve added.
Despite the weak market in December, Chevrolet Malibu continued
its solid performance with total sales up 43 percent compared with
last December. For 2008, Malibu sales of more than 178,000
vehicles were up 39 percent, making it the highest percentage
gainer in the top 20 vehicles sold in America with a volume
increase compared with 2007. With its six-speed transmission and
four-cylinder engine combination, the Malibu delivers an EPA-
estimated 33 mpg highway - tops in the industry's mid-car segment.
The Malibu Hybrid also offers the lowest-priced hybrid in the
segment. Additionally, with 4,500 retail vehicles delivered, the
Chevrolet Traverse crossover nearly doubled its retail volume
compared with November.
"We're really pleased about the strength of our Chevrolet brand,
with the Malibu continuing to perform very well, and the Traverse
crossover off to a strong start," LaNeve added. "Also, with a
harsh winter and lower gas prices, our trucks and SUVs are
continuing to perform well in their segments. With GMAC now able
to provide more financing capacity, and with all the exciting new
car and crossover launches including the Cadillac CTS Sport Wagon
and SRX, Chevy Camaro and Equinox, and Buick LaCrosse in 2009, we
are optimistic that with an overall market recovery we can begin
to capitalize on the well-recognized product renaissance of all
our brands."
A total of 2,555 GM hybrid vehicles were delivered in the month.
Hybrid sales included: 981 Chevrolet Tahoe, 442 GMC Yukon and 306
Cadillac Escalade 2-mode hybrid SUVs delivered. There were 454
Chevrolet Malibu, 34 Saturn Aura and 338 Vue hybrids sold in
December. In 2008, GM sold a total of 14,439 hybrid vehicles.
GM inventories dropped compared with a year ago. In December, only
about 872,000 vehicles were in stock, down about 36,000 vehicles
(or 4 percent) compared with last year. There were about 397,000
cars and 475,000 trucks (including crossovers) in inventory at the
end of December.
Certified Used Vehicles
December 2008 sales for all certified GM brands, including GM
Certified Used Vehicles, Cadillac Certified Pre-Owned Vehicles,
Saturn Certified Pre-Owned Vehicles, Saab Certified Pre-Owned
Vehicles, and HUMMER Certified Pre-Owned Vehicles, were 43,070
vehicles, up 21 percent from December 2007.
GM Certified Used Vehicles, the industry's top-selling certified
brand, posted December sales of 37,632 vehicles, up 24 percent
from December 2007. Saturn Certified Pre-Owned Vehicles sold 888
vehicles, down 24 percent. Cadillac Certified Pre-Owned Vehicles
sold 3,740 vehicles, up 11 percent. Saab Certified Pre-Owned
Vehicles sold 548 vehicles, up 14 percent, and HUMMER Certified
Pre-Owned Vehicles sold 262 vehicles, up 85 percent.
Total 2008 sales for all certified GM brands were 485,279
vehicles, down 5 percent from 2007. Annual sales for GM Certified
Used Vehicles were 422,114 vehicles, down 6 percent. Saturn
Certified Pre-Owned Vehicles sold 11,573 vehicles in 2008, down 9
percent. Cadillac Certified Pre-Owned Vehicles finished 2008 with
sales of 41,598 vehicles, up 7 percent from 2007, while Saab
Certified Pre-Owned Vehicles posted sales of 7,705 vehicles, up 6
percent, and HUMMER Certified Pre-Owned Vehicles sold 2,289
vehicles, up 71 percent.
"December sales for certified GM programs were strong, with GM
Certified Used Vehicles up 24 percent over last December, as
shoppers continue to seek value and peace of mind in a challenging
economy," said LaNeve. "GM Certified finished 2008 as the sales
leader among all manufacturer-certified pre-owned brands for the
seventh consecutive year, and our Cadillac, Saab and HUMMER luxury
certified brands each posted strong year-to-year sales increases."
GM North America Reports December, 2008 Production; Q1 2009
Production Forecast at 420,000 Vehicles
In December, GM North America produced 249,000 vehicles (105,000
cars and 144,000 trucks). This is down 3,000 vehicles or 1 percent
compared with December 2007 when the region produced 252,000
vehicles (71,000 cars and 181,000 trucks). (Production totals
include joint venture production of 10,000 vehicles in December
2008 and 15,000 vehicles in December 2007.)
GM North America built 823,000 vehicles (371,000 cars and 452,000
trucks) in the fourth-quarter of 2008. This is down 219,000
vehicles or 21 percent compared to fourth-quarter of 2007 when the
region produced 1.042 million vehicles (358,000 cars and 684,000
trucks). Additionally, the region's 2009 first-quarter production
forecast is now 420,000 vehicles (143,000 cars and 277,000
trucks), which is down about 53 percent compared with a year ago,
and about 180,000 fewer than the previous forecast. GM North
America built 885,000 vehicles (360,000 cars and 525,000 trucks)
in the first-quarter of 2008. First quarter 2008 production was
reduced nearly 100,000 vehicles due to the strike at American
Axle.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units. GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela. GM LAAM markets vehicles under the Buick,
Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and
Suzuki brands.
As reported in the Troubled Company Reporter on Nov. 10,
2008, General Motors Corporation's balance sheet at
Sept. 30, 2008, showed total assets of US$110.425 billion, total
liabilities of US$170.3 billion, resulting in a stockholders'
deficit of US$59.9 billion.
* * *
As reported in the Troubled Company Reporter on Nov. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on General Motors Corp. to 'CCC+'
from 'B-' and removed them from CreditWatch, where they had been
placed with negative implications on Oct. 9, 2008. S&P said that
the outlook is negative.
Fitch Ratings, as reported in the Troubled Company Reporter on
Nov. 11, 2008, placed the Issuer Default Rating of General Motors
on Rating Watch Negative as a result of the company's rapidly
diminishing liquidity position. Given the current liquidity level
of US$16.2 billion and the pace of negative cash flows, Fitch
expects that GM will require direct federal assistance over the
next quarter and the forbearance of trade creditors in order to
avoid default. With virtually no further access to external
capital and little potential for material asset sales, cash
holdings are expected to shortly reach minimum required operating
levels. Fitch placed these on Rating Watch Negative:
-- Senior secured at 'B/RR1';
-- Senior unsecured at 'CCC-/RR5'.
As reported in the Troubled Company Reporter on June 24, 2008,
DBRS has placed the ratings of General Motors Corp. and General
Motors of Canada Limited Under Review with Negative Implications.
The rating action reflects the structural deterioration of the
company's operations in North America brought on by high oil
prices and a slowing U.S. Economy.
GLOBAL TEL*LINK: Moody's Affirms Corporate Family Rating at 'B2'
----------------------------------------------------------------
Moody's Investors Service affirmed the B2 corporate family rating
of Global Tel*Link Corporation in light of the announced sale of
the company to Veritas Capital and GS Direct (a unit of Goldman
Sachs Group). The proposed transaction results in incremental
debt of approximately $75 million and an amendment to the existing
facility, but Moody's believes GTEL can sustain its B2 rating
despite the increase in debt based on better than expected
performance in 2008, expectations that the company will continue
to generate positive free cash flow, and management's track
record.
Moody's also changed GTEL's probability of default rating to B2
from B3 and upgraded the rating on the first lien bank debt to B1
from B2, in accordance with Moody's Loss Given Default
methodology.
Global Tel*Link Corporation
-- Affirmed B2 Corporate Family Rating
-- Senior Secured First Lien Bank Credit Facility, Upgraded to
B1, LGD3, 35% from B2
-- Probability of Default Rating, Upgraded to B2 from B3
-- Outlook: Stable
The B2 corporate family rating continues to reflect high leverage,
primarily the result of acquisitions and shareholder returns;
GTEL's lack of scale and narrow business focus; and some
regulatory risk. Furthermore, low operating margins suggest an
intense competitive environment, which Moody's does not expect to
change materially over the near-term despite industry
consolidation. Strong market share within its targeted
correctional telecommunications industry, a track record of
successful integration of acquisitions, and the high retention
rate and long term contracts support the rating.
Moody's changed GTEL's PDR to B2 from B3 and shifted to an average
(50%) recovery assumption from an above average (65%) recovery
assumption. The proposed transaction includes $95 million of
(unrated) bonds, compared to the existing all bank debt capital
structure. Moody's also upgraded the ratings on the first lien
bank debt to B1 from B2, as the proposed transaction includes some
repayment of first lien debt, and lenders now benefit from the
junior capital provided the bonds. However, the LGD assessment on
GTEL's first lien bank debt worsens slightly, moving to LGD3, 35%,
from LGD3, 32%, as the impact of the lower overall recovery
assumption offsets the cushion provided by bonds. In Moody's
view, all bank capital structures generally have a higher
probability of default, due to lenders' ability to influence (and,
specifically, to accelerate) the timing of a default event by
exercising control provisions within the credit facility prior to
more material erosion of enterprise value. GTEL's proposed debt
capital structure consists of both bank debt and bonds, leading to
a lower probability of default, but also a lower recovery, in
Moody's opinion.
Moody's most recent rating action concerning GTEL ratings occurred
on April 11, 2008, at which time Moody's affirmed all ratings.
Global Tel*Link Corporation, based in Mobile, Alabama, provides
telecommunications services to correctional facilities. GTEL
acquired the former MCI corrections division from Verizon on
July 18, 2007, to become the largest such provider in the United
States, serving 1,400 facilities and approximately 1 million
inmates.
GOODY'S FAMILY: To Liquidate Stores; Seeks Bankruptcy Protection
----------------------------------------------------------------
Karen Talley at The Wall Street Journal reports that Goody's
Family Clothing Inc. will liquidate its operations, closing its
282 stores.
Ashley M. Heher at The Associated Press relates that the
liquidation will start on Friday and will end by March.
According to The AP, the decision was made less than four months
after Goody's Family emerged from Chapter 11 bankruptcy
protection. The AP says that Goody's Family is working with its
vendors and its parent, PGDYS Lending LLC.
The AP states that Goody's Family has now sought bankruptcy
protection for the second time and executives with the company are
offering some of its stores to rivals. Citing sources, The New
York Post relates that Goody's Family is being forced into
liquidation by skittish lenders, after weeks of negotiations to
keep the company operating. After Goody's Family failed to
restructure terms with its creditors, it started seeking bids to
liquidate its inventory and other assets, WSJ relates, citing
Cathy Hershcopf, a bankruptcy attorney at Cooley Godward Kronish
LLP. The report quoted Ms. Hershcopf as saying, "They weren't as
capitalized as they need to be to weather this economic storm.
Management tried very hard to make it work."
Goody's Family runs 282 stores in the Southeast and has about
10,000 workers. Hoover's business information service says that
sales for fiscal 2007 were $904.7 million.
About Goody's Family
Headquartered in Knoxville, Tennessee, Goody's Family Clothing
Inc. -- http://www.shopgoodys.com/-- operates chains of clothing
stores. The company is owned by Goody's Holdings Inc., a non-
debtor entity.
GREATER OHIO ETHANOL: Seeks Mid-Jan. Auction, Inks NextGen Pact
---------------------------------------------------------------
Greater Ohio Ethanol, formerly known as Goe Lima LLC, will seek
approval from the U.S. Bankruptcy Court for the District of Ohio
to sell certain its assets to NextGen Energy LLC. NextGen's
offer, according to Bloomberg's Bill Rochelle is $5 million cash
and a note for $15.05 million.
The Bankruptcy Court previously set a Dec. 15 deadline for
submitting bids for the Debtor's assets. The Debtor, however,
wasn't able to identify acceptable bids.
The Court will convene a hearing today to consider the new auction
procedures, which will have NextGen as lead bidders. Greater Ohio
proposes a Jan. 14 deadline for competing bids, and a Jan. 16
auction. The Debtor will seek the Court's approval of the sale or
present the results of the auction on Jan. 21.
Plant Sale Extended
Bryan Sims at Ethanol Producer Magazine reports that lawyers and
lenders for Greater Ohio Ethanol LLC are still seeking for a buyer
for the firm's idled corn-based ethanol plant in Lima, Ohio, after
two rounds of extension deadlines.
According to Ethanol Producer, Greater Ohio Ethanol's attorneys
and creditors asked the Hon. Mary Ann Whipple in the U.S.
Bankruptcy Court for the Northern District of Ohio to extend the
sale to mid-January. The attorneys for Greater Ohio Ethanol also
asked that the bid deadline be set for Jan. 14 and the auction
date set for Jan. 16, Ethanol Producer states. The report says
that Judge Whipple gave temporary approval to the extension. A
hearing will be held on Jan. 7, when attorneys would provide
further details of the sale and funding structure and when the
bidding and auction date would be finalized, according to the
report.
Ethanol Producer relates that the attorneys for Greater Ohio
Ethanol estimated the plant's sale price to be $18 million, less
than the $90 million owed to major investors.
About Greater Ohio
Headquartered in Lima, Ohio, GOE Lima LLC -- http://www.go-
ethanol.com/ -- operates an ethanol production facility. The
company filed for protection on Oct. 14, 2008 (Bankr. N.D. Ohio
Case No. 08-35508). Taft Stettinius & Hollister LLP is the
Debtor's proposed bankruptcy counsel. When the Debtor filed for
protection from its creditors, its listed assets and debts between
$100 million to $500 million each.
GREY WOLF: Moody's Withdraws 'Ba3' Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service has withdrawn Grey Wolf, Inc.'s Ba3
corporate family rating and probability of default rating
following Precision Drilling Trust's acquisition of Grey Wolf on
December 23, 2008. Grey Wolf's outstanding 3.75% senior unsecured
convertible notes will continue to be rated B1 (LGD5, 88%). Grey
Wolf is now a subsidiary of Precision Drilling Trust.
Moody's last rating action on Grey Wolf was to place its ratings
under review for possible upgrade on August 25, 2008 following its
announcement that it had agreed to be acquired by Precision
Drilling Trust. Moody's last rating action on Precision Drilling
Corporation, a subsidiary of Precision Drilling Trust, was to
lower its CFR to Ba2 from Ba1 and assign a negative outlook on
December 22, 2008.
Precision Drilling Corporation and Grey Wolf, Inc are subsidiaries
of Precision Drilling Trust, a Calgary, Alberta-based income trust
engaged in the provision of energy services to the oil and gas
industry in North America.
HAWAIIAN TELCOM: Committee Opposes Bid to Use Cash Collateral
-------------------------------------------------------------
The Official Committee of Unsecured Creditors in Hawaiian Telcom
Communications' bankruptcy case, joined by Pacific Investment
Management Company LLC and Capital Research and Management
Company, representing the Debtors' largest unsecured creditors,
oppose the Debtors' request to use the cash collateral securing
obligations to their prepetition lenders.
On the Committee's behalf, Christopher J. Muzzi, Esq., at Moseley
Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii, contends that
the Debtors seek to protect Prepetition Lenders, whose lien does
not extend to a substantial portion of the Debtors' assets, and
even to the Cash Collateral. The Debtors seem to seek substantial
protections for the Prepetition Lenders that will help insulate
them from any challenge to their liens and claims, he points out.
Specifically, Mr. Muzzi notes, the Cash Collateral Motion
contemplates that the Prepetition Lenders will be paid all
interests and fees, including undisclosed transaction fees with
financial advisors, that became due after Hawaiian Telcom's
bankruptcy filing.
Mr. Muzzi argues that the Prepetition Lenders should not be
entitled to payments because the Debtors have failed to
demonstrate that the Prepetition Lenders' collateral is declining
in value. Moreover, he points out, the Debtors' pleadings before
the United States Bankruptcy Court for the District of Hawaii
suggest that the Prepetition Lenders are unsecured and thus, are
not entitled to payments under the Bankruptcy Code.
The Committee asserts that the Debtors' postpetition use of their
substantial unencumbered assets through their business operations
enhances the value of the Prepetition Lenders' collateral. Hence,
the Committee maintains, the Prepetition Lenders do not appear to
be in need of any adequate protection.
In light of these contentions, the Committee proposes that the
Final Cash Collateral Order be amended to reflect these terms:
(a) The Prepetition Lenders' adequate protection liens and
superpriority claims should not attach to avoidance
actions or the proceeds of those actions.
(b) The waiver of the Debtors' rights to seek a surcharge
under Section 506(c) of the Bankruptcy Code should be
eliminated.
(c) Restrictions on the Committee's rights use of the Cash
Collateral should be eliminated. The restrictions include
a $50,000 budget to perform an investigation and the
inability to use any of the alleged Cash Collateral to
commence and prosecute any action. The Committee should
also be provided with express standing to commence any
action against the Prepetition Lenders, and the
Committee's investigation period should be substantially
extended.
(d) The trigger Termination Events, including the suggested
"Outside Date of March 31, 2009," should be eliminated or
pared back substantially.
(e) The Final Order should contain an express provision
providing that if the Court finds that the Prepetition
Lenders do not have a lien on the Debtors' cash, all
protections provided under the Final Order will be deemed
null and void.
Hewlett-Packard Company and HYP Media Finance LLC also filed
separate responses to the Cash Collateral Motion.
Hewlett-Packard says it does not object to the Debtors' request
for cash collateral use, but seeks to preserve its rights and
remedies under its agreements with the Debtors in law or in
equity, including its rights of setoff or recoupment.
Hewlett-Packard opposes the automatic default provision in the
Cash Collateral Motion when parties seek relief from the automatic
stay, to the extent that such provision is used as a shield to
prevent parties from obtaining stay relief.
Hewlett-Packard adds that the Final Cash Collateral Order should
clarify that any liens, security interests, or superpriority
claims granted to the Prepetition Agent, in connection with the
use of the Cash Collateral, do not impact or impair its rights of
set-off or recoupment.
HYP Media Finance also seeks to reserve its rights and interests
with respect to certain accounts receivables for advertising
charges, which are billed by the Debtors on behalf of HYP Media.
Edward C. Dolan, Esq., at Hogan & Hartson L.L.P., in Washington,
D.C., asserts that the Accounts Receivables constitute property of
HYP Media, which holds all right, title, and interest in those
Receivables. He maintains that adequate protection offered by the
Debtors through the Adequate Protection Liens are not valid and
perfected security interests in and liens on the Accounts
Receivables.
Mr. Dolan clarifies that the Accounts Receivables do not
constitute collateral under the Cash Collateral Order. He adds
that to the extent that it does constitute Cash Collateral, the
Debtors are not authorized to use, sell or lease those Receivables
without adequate protection, pursuant to the Court's order.
Accordingly, HYP Media asks the Court to recognize its ownership
of the Accounts Receivables, and to determine that any security
interests and liens on the Receivables are not valid or perfected.
About Hawaiian Telecom
Based in Honolulu, Hawaii, Hawaiian Telecom Communications, Inc.
-- http://www.hawaiiantel.com/-- operates a telecommunications
company, which offers an array of telecommunications products and
services including local and long distance service, high-speed
Internet, wireless services, and print directory and Internet
directory services.
The company and seven of its affiliates filed for Chapter 11
protection on Dec. 1, 2008 (Bankr. D. Del. Lead Case No.
08-13086). As reported by the Troubled Company Reporter on
December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court
for the District of Delaware approved the transfer of the Chapter
11 cases to the U.S. Bankruptcy Court for the District of Hawaii
before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005).
Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J.
Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in
their restructuring efforts. The Debtors proposed Lazard Freres &
Co. LLC as investment banker; Zolfo Cooper Management LLC as
business advisor; Deloitte & Touche LLP as independent auditors;
and Kurztman Carson Consultants LLC as notice and claims agent.
An official committee of unsecured creditors has been appointed in
the case. The committee is represented by Christopher J. Muzzi,
Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu,
Hawaii.
When the Debtors filed for protection from their creditors, they
listed total assets of $1,352,000,000 and total debts of
$1,269,000,000 as of Sept. 30, 2008. (Hawaiian Telcom Bankruptcy
News; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000 ).
HIGH RIVER GOLD: In Talks with Lenders on Unit's Covenant Breach
----------------------------------------------------------------
High River Gold Mines Ltd. on Friday provided an update on its
financial situation, on recent personnel changes, and on the
operating status of its four gold mines:
(A) Financial Status
* Cash Position
As of December 31, 2008, High River's head office cash
position totalled approximately $11 million, a lower
than anticipated amount due to the negative impact on
company cashflow from the unexpected operational
difficulties at its Taparko and Berezitovy units.
* Lenders
High River and its operating subsidiaries have three
lenders which comprise the majority of current and long
term debt outstanding.
Approximately one half of the consolidated current and
long term debt outstanding of $193 million, as of
September 30, 2008, is comprised of various loans due to
Nomos Bank by Buryatzoloto and Berezitovy. All scheduled
loan repayments have been made to Nomos Bank, including
a US$15 million loan repayment on November 21, 2008 on
behalf of Berezitovy, and a further US$10 million loan
repayment on December 21, 2008 on behalf of Buryatzoloto
operations.
High River's Somita SA subsidiary, which operates the
Taparko mine, continues to be in breach of loan
covenants pursuant to the US$35 million loan agreement
with Royal Gold Inc. The present balance of the
facility with Royal Gold Inc. is US$30.3 million.
Discussions are ongoing regarding obtaining a waiver of
the covenant breaches.
Standard Bank Plc, with loans to Somita SA and High
River of approximately $27 million, was recently granted
a corporate guarantee from Severstal after completion of
the Severstal private placement in High River. The
repayment date on these facilities has been extended
into 2010.
Total High River consolidated debt at the end of
December 2008 is anticipated to be approximately
US$142 million.
* Trade Creditors
Recently, High River advised Somita SA trade creditors
that it will slow down payments for accounts payable
for a brief period in light of lower than expected
cashflows from the group's operations. Management
plans to pay suppliers for current purchases of goods
and services.
* Actions being taken to meet financial obligations
High River is currently in discussions relating to
additional debt or equity financing arrangements to
meet its financial obligations. It hopes to finalize
these arrangements by January 31, 2009.
(B) Operations Update
* Taparko
After a prolonged mill shutdown, the Taparko mill was
restarted in November 2008. Early indications were
that the mill vibration issue was resolved with the
replacement of the gearbox. However, after several
weeks of operation, the vibrations previously
encountered in the mill drive-train have recently
re-occurred. As a result, throughput for December has
varied from zero to just over 2,000 tonnes per day,
substantially below the planned average throughput rate
of 2,450 tonnes per day. December gold production will
consequently total approximately 4,100 ounces. A
7 to 10 day mill shutdown is scheduled for mid-January
during which operating personnel will undertake action
designed to correct the problem. Remedial action will
include the reinstallation of the electric motor base
plate, and a rotation of the ball mill bull gear
180 degrees about the vertical axis.
* Berezitovy
After the achievement of commercial production on
October 1, 2008, Berezitovy mill throughput regularly
exceeded 85% of the design capacity with satisfactory
recoveries. Recently, throughput and recoveries at the
mill have suffered due to mining in the pit
encompassing the old underground workings, which
resulted in fragments of the old timbers entering the
process plant. Also the mill has been producing too
coarse a grind, which has also adversely affected
recoveries. As a result, gold production during the
month of December is only expected to total roughly
1,400 ounces, with a further 3,200 ounces in material
available for future processing in the furnace.
Operating personnel at the mine are currently planning
remedial action to resolve the issue.
* Buryatzoloto (Zun-Holba and Irokinda)
The Zun-Holba and Irokinda underground gold mines
continue to operate according to plan, and are
currently on track to meet the budgeted 2008 whole
year production target of 145,000 gold ounces (100%
basis).
(C) Personnel Changes
Two officers of High River, Don Whalen, Executive Vice
President, and Mike Kelly, Executive Vice President and
Chief Operating Officer, have left the company. In the
interim, until a permanent replacement can be found,
Chief Operating Officer duties will be shared by High
River CEO, Nikolay Zelenskiy, and the mine managers of
the company's 4 operating mines. As well, Valery
Dmitriev, General Director of Buryatzoloto, has left High
River. Replacing him is Vladimir Baltsat, who previously
worked for Peter Hambro Mining Plc as the mine manager of
the Pokrovsky mine in Russia.
About High River
Based in Toronto, Ontario, High River Gold Mines Ltd. (TSX: HRG) -
- http://www.hrg.ca-- is a gold company with interests in
producing mines, mines under development, and advanced exploration
projects in Burkina Faso and Russia.
HLMC REALTY: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: HLMC Realty Services, LLC
17600 South Pulaski
Country Club Hills, IL 60478
Tel.: (708) 798-2200
Bankruptcy Case No.: 08-35866
Type of Business: Mortgage Bankers and Loan Correspondents
Chapter 11 Petition Date: December 31, 2008
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: A. Benjamin Goldgar
Debtor's Counsel: Thomas W. Toolis, Esq.
Jahnke & Toolis, LLC
9031 West 151st Street, Suite 203
Orland Park, IL 60462
Tel.: (708) 349-9333
Fax : (708) 349-8333
Email: twt@jtlawllc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/ilnb08-35866.pdf
The petition was signed by Rajaei Haddad, Member of the company.
HRP MYRTLE: Delaware Court Approves Chapter 7 Conversion
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware converted
the chapter 11 case of HRP Myrtle Beach Holdings to Chapter 7
liquidation proceedings, according to Bankruptcy Data. The U.S.
Trustee for Region 3 appointed Alfred T. Giuliano as Chapter 7
trustee.
As reported by the Troubled Company Reporter yesterday, Lisa
Fleisher at The Sun News said the Debtor sought Chapter 7
conversion after failing to find a buyer. Court documents say
that, because the bid and sale process has been unsuccessful,
"there exists no reasonable prospect of success in the immediate
future. Regrettably, conversion of [the park's] Chapter 11
bankruptcy cases to cases under Chapter 7 of the bankruptcy code
thus appears to be the only remaining means of allowing the
debtors' assets to be liquidated and potential causes of action to
be pursued and monetized for the benefit of creditors."
Based in Myrtle Beach, South Carolina, HRP Myrtle Beach Holdings,
LLC -- owns and operates Hard Rock Park, a rock-n-roll theme park
in Myrtle Beach, South Carolina, under a long-term license
agreement with Hard Rock Cafe International (USA), Inc. The
company and six of its affiliates filed for Chapter 11 protection
on Sept. 24, 2008 (Bankr. D. Del. Lead Case No. 08-12193). Steven
Goodwin will serve as the Debtors' chief executive officer. The
U.S. Trustee for Region 3 has not appointed creditors to serve on
an Official Committee of Unsecured Creditors. Richards, Layton &
Finger represents the Debtors as counsel. Dorsey & Whitney LLP
represents the Officiala Committee of Unsecured Creditors as
counsel. When the Debtors filed for protection from their
creditors, they listed assets and debts of between $100 million
and $500 million each.
INDYMAC BANK: FDIC to Sell Banking Operations to IMB
----------------------------------------------------
The Federal Deposit Insurance Corporation signed on Dec. 31, 2008,
a letter of intent to sell the banking operations of IndyMac
Federal Bank, FSB, Pasadena, California, to a thrift holding
company controlled by IMB Management Holdings LP, a limited
partnership. The FDIC's Board of Directors approved the agreement
to sell IndyMac Federal to the investor group.
"The current economic climate is challenging for selling assets,
but this agreement achieves the goals that were set out by the
Chairman and Board when the FDIC was named conservator of IndyMac
in July," said FDIC Deputy Director James Wigand, the lead
negotiator for the transaction. "Unfortunately, as expected,
IndyMac's liability structure, combined with aggressive real
estate lending in California, had a significant impact on losses."
Prior to the IndyMac failure on July 11, 2008, the bank relied
heavily on higher cost, less stable, brokered deposits, as well as
secured borrowings, to fund its operations and focused on stated
income and other aggressively underwritten loans in areas with
rapidly escalating home prices, particularly in California and
Florida. Since the FDIC has operated the institution, it has
restructured funding to focus on more stable core deposits and on
improving the value of the loans.
IMB Management Holdings LP and the investor group will inject a
substantial amount of capital into a newly formed thrift holding
company, which will own and operate IndyMac Federal. IMB
Management Holdings LP has agreed to bring in an experienced
senior management team to run the day-to-day operations of the
thrift.
Despite the challenges of selling assets in today's current
economic climate, the FDIC received considerable initial interest
from potential bidders. It was determined that the bid from IMB
Management Holdings, LP, was the least costly to the Deposit
Insurance Fund of all competing bids.
The agreement with IMB Management Holdings is not the first time
private equity firms have participated in acquiring failed
institutions. In the early 1990s, the FDIC tapped private equity
when it sold New Bank of New England and CrossLand Federal Savings
Bank.
The streamlined loan modification program introduced at IndyMac by
the FDIC in late August has provided total estimated savings of
$423 million based on a comparison of the projected net present
value of the modified loans to the net present value of
foreclosure. The continuation of the loan modification program
will be a condition for the FDIC to provide any type of loss-
sharing on IndyMac's assets.
"The FDIC and IndyMac staff accomplished a tremendous amount of
work in a short period of time to help thousands of struggling
homeowners stay in their homes and maximize value for both the
Deposit Insurance Fund and mortgage investors," said John Bovenzi,
CEO of IndyMac Federal and FDIC Chief Operating Officer.
The transaction is expected to close in late January or early
February, at which time full details of the agreement will be
provided. It is estimated that the cost to the FDIC's DIF for
resolving IndyMac Bank will be between $8.5 billion and
$9.4 billion, in line with previous loss estimates. Costs include
prepayment fees of $341.4 million to the Federal Home Loan Bank of
San Francisco, on the payoff of $6.3 billion in FHLB advances.
"It is unfortunate that many of the banks that have failed last
year had a heavy reliance on Federal Home Loan Bank advances," Mr.
Bovenzi said. "These secured borrowings and the associated
prepayment penalties have the effect of increasing the costs to
the FDIC and to uninsured depositors."
About FDIC
Congress created the Federal Deposit Insurance Corporation --
http://www.fdic.gov-- in 1933 to restore public confidence in the
nation's banking system. The FDIC insures deposits at the
nation's 8,384 banks and savings associations and it promotes the
safety and soundness of these institutions by identifying,
monitoring and addressing risks to which they are exposed. The
FDIC receives no federal tax dollars -- insured financial
institutions fund its operations.
About Indymac
Based in Pasadena, California, IndyMac Bancorp Inc. (NYSE:IMB) --
http://www.indymacbank.com/-- is the holding company for IndyMac
Bank FSB, a hybrid thrift/mortgage bank that originated mortgages
in all 50 states of the United States. Through its hybrid thrift-
mortgage bank business model, IndyMac designed, manufactured, and
distributing cost-efficient financing for the acquisition,
development, and improvement of single-family homes. IndyMac also
provided financing secured by single-family homes to facilitate
consumers' personal financial goals and strategically invests in
single-family mortgage-related assets.
On July 11, 2008, the Office of Thrift Supervision closed IndyMac
Bank and appointed FDIC as the bank's receiver. Thacher Proffitt
& Wood LLP was engaged as counsel to the FDIC.
Indymac Bancorp filed for Chapter 7 bankruptcy protection on
July 31, 2008 (Bankr. C.D.Calif., Case No. 08-21752).
Representing the Debtor are Dean G. Rallis, Jr., Esq., and John C.
Weitnauer, Esq. Bloomberg noted that Indymac had about
$32.01 billion in assets as of July 11, 2008. In court documents,
IndyMac disclosed estimated assets of $50 million to $100 million
and estimated debts of $100 million to $500 million.
INTERSTATE BAKERIES: 400 Prepetition Union Claims Resolved
----------------------------------------------------------
In a status report of prepetition union grievances filed with the
U.S. Bankruptcy Court for the Western District of Missouri dated
December 29, 2008, J. Eric Ivester, Esq., at Skadden Arps Slate
Meagher & Flom, LLP, in Chicago, Illinois, disclosed on behalf of
Interstate Bakeries Corp. that since IBC's bankruptcy filing,
approximately 400 prepetition union claims have been resolved,
aggregating $270,000.
The Debtors' status report is in accordance with the Court's order
requiring them to file, every 60 days, a summary statement of the
number of prepetition union grievances that have been resolved and
the aggregate amount of grievance resolutions.
About Interstate Bakeries
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh-baked
bread and sweet goods, under various national brand names,
including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and
Drake's(R). Currently, IBC employs more than 25,000 people and
operates 45 bakeries, as well as approximately 800 distribution
centers and approximately 800 bakery outlets throughout the
country.
The company and eight of its subsidiaries and affiliates filed for
chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6% senior subordinated convertible notes due Aug. 15, 2014) in
total debts.
The Debtors first filed their Chapter 11 Plan and Disclosure
Statement on Nov. 5, 2007. On Jan. 30, 2008, the Debtors received
court approval of the disclosure statement explaining their first
amended plan. IBC did not receive any qualifying alternative
proposals for funding its plan in accordance with the court-
approved alternative proposal procedures.
The Debtors, on Oct. 4, 2008, filed another Plan, which
contemplates IBC's emergence from Chapter 11 as a stand-alone
company. The filing of the Plan was made in connection with the
plan funding commitments, on Sept. 12, 2008, from an affiliate of
Ripplewood Holdings L.L.C. and from Silver Point Finance, LLC, and
Monarch Master Funding Ltd.
On December 5, 2008, the Bankruptcy Court confirmed IBC's Amended
New Joint Plan of Reorganization. The plan was filed October 31,
2008. The exit financings that form the basis for the Plan are
reflected in corresponding debt and equity commitments.
As reported by the Troubled Company Reporter on December 30, 2008,
Interstate Bakeries' Chief Executive Officer Craig D. Jung and
Chief Financial Officer J. Randall Vance said IBC is still
focusing on negotiating and finalizing all documentation for the
Exit Financings and satisfying the remaining conditions precedent
to closing of the various transactions contemplated under the
Plan. Although progress has been made, significant issues remain
to be resolved, the IBC Officers said.
(Interstate Bakeries Bankruptcy News; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
JD CAPITAL: Will Wind Down Hedge Fund After Losses in 2008
----------------------------------------------------------
Joseph Checkler at The Wall Street Journal reports that Goldman
Sachs veteran J. David Rogers has decided to wind down his JD
Capital Management LLC's Tempo Master Fund, after reporting big
losses in 2008.
Citing a person familiar with the matter, WSJ states that Tempo
Master had as much as $1.3 billion in assets in 2007. The source
said that poor-performing strategies in 2008 included ones
involving convertible arbitrage and distressed loans, WSJ says.
WSJ relates that Tempo Master found itself down more than 40% for
2008. Mr. Rogers, according to WSJ, said that he will continue
running a volatility fund that he began in June 2008, which has
$100 million in assets.
WSJ quoted Mr. Rogers as saying, "We've decided to focus on what
has been one of our core strengths all along, and that is the
volatility business."
JD Capital Management LLC is a hedge-fund firm founded by Goldman
Sachs veteran J. David Rogers in 2001.
KAUPTHING BANK: Committee to Take Legal Action v. U.K. Govt
-----------------------------------------------------------
Reuters reports that the Resolution Committee of Kaupthing Bank hf
will take legal action against the British government over a
decision to place Kaupthing Singer and Friedlander in
administration.
The Treasury, Reuters recounts, placed Kaupthing's UK unit in
administration on Oct. 8, in a move to protect British retail
depositors.
However, Reuters relates that according to Iceland, Britain's
actions helped bring about Kaupthing's failure prematurely.
"The Resolution Committee of Kaupthing has decided to sue the
British Government and has the full support of the government," a
press release from the Icelandic prime minister's office obtained
by Reuters said.
A Treasury spokesman meanwhile said the Treasury was not aware of
any legal action, noting the Financial Services Authority had
judged Kaupthing's UK subsidiary to be unable to meet its
obligations to depositors, Reuters discloses.
About Kaupthing Bank
Headquartered in Reykjavik, Iceland, Kaupthing Bank --
http://www.kaupthing.com-- is engaged in the provision of
financial services, such as private banking, asset management,
pension services, brokerage services, investment banking, as well
as corporate and retail banking. The Bank's offer is targeted at
companies, institutional investors and individuals. The Bank is
operational in thirteen countries, including Luxembourg,
Switzerland, the Nordic countries, the United Kingdom and the
United States. The main subsidiaries include Kaupthing Singer &
Friedlander and FIH Erhvervsbank.
* * *
On Nov. 30, 2008, Kaupthing Bank hf. filed a voluntary petition
under Chapter 15 of the US Bankruptcy Code, in order to
seek US recognition of the bank's moratorium, which has been
granted by the District Court of Reykjavik, Iceland.
Citing a court filing by Olafur Gardarsson, a court-appointed
assistant who is managing the bank's reorganization, Reuters
discloses Kaupthing has about US$14.8 billion of principal assets,
including $222 million located in the United States, and
$26 billion of principal indebtedness.
KP FASHION: Files for Chapter 7 Liquidation
-------------------------------------------
Bob Van Voris at Bloomberg News reports that KP Fashion Co. has
filed for Chapter 7 liquidation in the U.S. Bankruptcy Court for
the Southern District of New York.
According to Bloomberg, KP Fashion said in December that it would
close almost all of its 12 stores. Court documents say that the
company listed $9.7 million in assets and $54.4 million in debt.
Bloomberg's Bill Rochelle notes that KP Fashion didn't even
attempt to reorganize or control their own liquidation in Chapter
11.
Bloomberg states that Sergei Plastinin said he spent about
$80 million to set up stores for his daughter, Kira Plastinina.
Ms. Plastinina has about 70 stores in Russia, which are excluded
in the Chapter 7 bankruptcy filing.
Court documents say that Lendero Ltd., a Cyprus company controlled
by Mr. Plastinin is KP Fashion's biggest creditor, with a
$29.9 million loan.
Bloomberg states that KP Fashion's U.S. Web site shows most of the
clothes being sold at a 75% discount.
Los Angeles-based KP Fashion Co. is a company set up by the Sergei
Plastinin for his 16-year-old Russian fashion designer daughter
Kira Plastinina to sell her clothes in the U.S. The company
offered jeans, t-shirts, dresses, pants, shoes, and accessories.
LEINER HEALTH: Declares Chapter 11 Liquidation Plan Effective
-------------------------------------------------------------
Bankruptcy Data reports that Leiner Health Products's Joint Plan
of Liquidation has become effective, and the company emerged from
Chapter 11 protection.
As reported by the Troubled Company Reporter on July 23, 2008, the
plan contemplates the liquidation of the each of the Debtors'
assets, the appointment of a liquidating trustee, and the creation
of a three-member liquidating trust committee, which consist of
one representative selected by the Debtors and two members
appointed by the Official Committee of Unsecured Creditors.
Furthermore, the plan provides the creation of a liquidating trust
for, among other things, (i) resolving all disputed claims, (ii)
pursuing the causes of action, and (iii) making all distribution
to the beneficiaries provided under the plan.
On July 14, 2008, NBTY Inc., the designated stalking-horse bidder,
completed the sale of the Debtors' assets for $371,000,000 in
cash, plus the assumption of about $30,000,000 of trade payables
and a purchase price adjustment. According to court documents,
the sale proceeds may be sufficient to satisfy the claims of the
Debtors' senior secured lender in full, but it may not be enough
to provide a recovery to unsecured creditors.
The plan projects a 6% recovery to allowed general unsecured
claims. Equityholders are out of the money.
As reported by the Troubled Company Reporter on October 17, 2008,
the Hon. Kevin J. Carey confirmed the Plan, finding that the Plan
meets the requirements under Section 1129 of the United States
Bankruptcy Code.
On December 3, 2008, the TCR said plan's effective date has been
delayed because the Debtors and NBTY Acquisitions LLC, which
purchased the Debtors' assets, were unable to resolve the working
capital adjustment as set forth in an amended and restated asset
purchase agreement.
About Leiner Health
Based in Carson, California, Leiner Health Products Inc. nka
Supplements LT Inc. -- http://www.leiner.com/-- manufactures and
supplies store brand vitamins, minerals and nutritional
supplements products, and over-the-counter pharmaceuticals in the
US food, drug and mass merchant and warehouse club retail market.
In addition to its primary VMS and OTC products, they provide
contract manufacturing services. During the fiscal year ended
March 31, 2007, the VMS business comprised approximately 61% of
net sales. On March 20, 2007, they voluntarily suspended the
production and distribution of all OTC products manufactured,
packaged or tested at its facilities in the US.
The company filed for Chapter 11 protection on March 10, 2008
(Bankr. D. Del. Lead Case No.08-10446). Jason M. Madron, Esq.,
and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A.,
represent the Debtors. The Debtors selected Garden City Group
Inc. as noticing, claims and balloting agent. The U.S. Trustee
for Region 3 appointed creditors to serve on an Official Committee
of Unsecured Creditors in these cases. The Committee selects Saul
Ewing LLP as its counsel.
As reported in the Troubled Company Reporter on April 10, 2008,
the Debtors' schedules of assets and liabilities showed total
assets of $133,412,547 and total debts of $477,961,526.
LEVITT AND SONS: Court OKs Disc. Statement, Allows Voting on Plan
-----------------------------------------------------------------
Judge Raymond B. Ray of the U.S. Bankruptcy Court for the Southern
District of Florida held that the revised Second Amended
Disclosure Statement dated December 18, 2008, explaining the
Second Amended Plan of Liquidation filed by Levitt and Sons LLC
and its official unsecured creditors committee, complies with all
the aspects of Section 1125 of the Bankruptcy Code.
Judge Ray approved the revised Second Amended Disclosure Statement
on December 29, 2008, as containing adequate information as
defined by Section 1125(a).
Any objections to the approval of the Second Amended Disclosure
Statement that were not resolved or otherwise withdrawn are
deemed overruled.
The Plan Proponents are authorized to serve, no later than
January 15, 2009, copies of the Second Amended Disclosure
Statement, the Plan and the Disclosure Statement Order and other
related documents in the Solicitation Package to creditors
entitled to vote on the Plan and certain notice parties. The
Solicitation Package will also include a cover letter from the
Debtors describing contents of the Solicitation Package; a cover
letter from each of the Deposit Holders' Committee and the
Official Committee of Unsecured Creditors urging its constituents
to vote to accept the Plan; and the appropriate form of ballot
and instructions on how to complete the ballot.
The Court also approved the proposed Solicitation and Voting
Procedures in connection with the Plan.
The Voting Record Date is set as December 23, 2008.
Creditors should accomplish and send in their ballots to be
received by the Balloting Agent no later than February 9, 2009,
at 5:00 p.m., Pacific Time.
Judge Ray will convene a confirmation hearing on the Plan on
February 20, 2009, Eastern Time. The hearing may be continued
from time to time without further notice other than the
announcement of the adjournment in open court or a notice of
adjournment filed with the Court and served on the Master Service
List and the Plan objectors. Parties-in-interest have until 5:00
p.m., Eastern Standard Time, on February 4, 2009, to file any
objections to the confirmation of the Plan.
The Court set January 30, 2009, as the deadline for the filing of
all final applications for compensation and reimbursement of
expenses for bankruptcy professionals in the Debtors' cases. The
Plan Proponents will serve a notice on February 4, 2009, of all
final fee applications requested. The notice will be served on
all creditors, all equity security holders and all other parties-
in-interest as required by the Bankruptcy Rules and the Local
Bankruptcy Rules, including those listed on a Master Service List
required to be filed pursuant to Local Rule 2002-1(K) of the
Bankruptcy Court for the Southern District of Florida.
The deadline for the filing of objections to claims will be 180
days after the Effective Date of the Plan, Judge Ray ruled.
A full-text copy of the Final Disclosure Statement Order,
including the Ballot forms, is available at no charge at:
http://ResearchArchives.com/t/s?375a
The Plan Proponents delivered to the Court on January 2, 2009,
final blacklined version of their Second Amended Disclosure
Statement, as revised, a full-text copy of which is available for
free at:
http://ResearchArchives.com/t/s?375b
The Plan Proponents delivered to the Court on January 2, 2009,
final blacklined version of their Second Amended Chapter 11
Liquidating Plan, as revised, a full-text copy of which is
available for free at:
http://ResearchArchives.com/t/s?375c
The Plan Proponents also filed a corrected version of their
Liquidation Analysis, a full-text copy of which can be accessed
for free at:
http://ResearchArchives.com/t/s?3759
About Levitt and Sons
Headquartered in Fort Lauderdale, Florida, Levitt and Sons LLC --
http://www.levittandsons.com/-- is the homebuilding subsidiary of
Levitt Corporation (NYSE:LEV). Levitt Corp. --
http://www.levittcorporation.com/-- together with its
subsidiaries, operates as a homebuilding and real estate
development company in the southeastern United States. The
company operates in two divisions, homebuilding and land. The
homebuilding division primarily develops single and multi-family
homes for adults and families in Florida, Georgia, Tennessee, and
South Carolina. The land division engages in the development of
master-planned communities in Florida and South Carolina.
Levitt and Sons LLC and 38 of its homebuilding affiliates filed
for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead
Case No. 07-19845). Paul Singerman, Esq. and Jordi Guso, Esq., at
Berger Singerman, P.A., represent the Debtors in their
restructuring efforts. The Debtors chose AP Services, LLC as
their crisis managers, and Kurtzman Carson Consultants, LLC as
their claims and noticing agent. Levitt Corp., the parent
company, is not included in the bankruptcy filing.
(Levitt and Sons Bankruptcy News; Bankruptcy Creditors' Service
Inc.; http://bankrupt.com/newsstand/or 215/945-7000 ).
LITHIUM TECH: Files March 31 & June 30 Qtr. Financial Reports
-------------------------------------------------------------
Lithium Technology Corp. delivered to the Securities and Exchange
Commission its Form 10-Qs for the quarters ended March 31, 2008,
and June 30, 2008.
As of March 31, 2008, the company's balance sheet showed total
assets of $15,186,000 and total liabilities of $19,558,000,
resulting in total stockholders' deficit of $4,372,000. As of
March 31, the company's working capital deficit was $13,528,000 as
compared to $25,444,000 on December 31, 2007. The company
reported net income of $3,521,000 for the three months ended March
31.
As of June 30, 2008, the company's balance sheet showed total
assets of $14,127,000 and total liabilities of $23,838,000
(consisting of all current liabilities), resulting in total
stockholders' deficit of $9,711,000. As of June 30, the company's
working capital deficit was $18,698,000. The company posted a net
loss of $5,343,000 for the three months ended June 30. The
company expects to incur substantial operating losses as it
continues its commercialization efforts.
"Since inception, we have incurred substantial operating losses
and expect to incur additional operating losses over the next
several years. As of June 30, 2008, we had an accumulated deficit
of approximately $132,881,000. We have financed our operations
since inception primarily through equity financings, loans from
shareholders and other related parties, loans from silent partners
and bank borrowings secured by assets. We have recently entered
into a number of financing transactions and are continuing to seek
other financing initiatives. We will need to raise additional
capital to meet our working capital needs and to complete our
product commercialization process. Such capital is expected to
come from the sale of securities and debt financing. No assurances
can be given that such financing will be available in sufficient
amounts or at all. Continuation of our operations in the future
is dependent upon obtaining such further financing. These
conditions raise substantial doubt about our ability to continue
as a going concern," Chief Executive Officer Theo M. M. Kremers
disclosed in a regulatory filing.
A full-text copy of the company's quarterly reports for the period
ended March 31, 2008, is available for free at:
http://researcharchives.com/t/s?3748
A full-text copy of the company's quarterly reports for the period
ended June 30, 2008, is available for free at:
http://researcharchives.com/t/s?3747
About Lithium Technology Corp.
Lithium Technology Corp. is a global manufacturer of Li-ion cells
and a global provider of power solutions for diverse applications.
LTC is especially well positioned in the fast growing markets of
electrical cars and stationary power. The company expects results
to substantially improve in the near future.
LUMINENT MORTGAGE: Files Disclosure Statement & 1st Amended Plan
----------------------------------------------------------------
Luminent Mortgage Capital, Inc., and its debtor-affiliates
delivered to the U.S. Bankruptcy Court for the District of
Maryland on Dec. 31, 2008, a Disclosure Statement explaining their
First Amended Joint Plan.
The Debtors believe that absent the consideration being provided
by secured creditors --- known as the ACC Parties -- under their
plan support agreement, there is little or no likelihood that
there would be unencumbered assets available. Thus, the Debtors
believe that acceptance of the Plan is in the best interests of
creditors.
Plan Summary
The Plan provides for:
-- The consummation of the transactions contemplated by the
Exit Financing Agreement on the Effective Date of the Plan,
the proceeds of which will be used to make a number of the
payments contemplated by the Plan;
-- The conversion of Debtor Luminent Mortgage Capital, Inc.,
from a publicly traded real estate investment trust into a
private asset management company and the issuance of the
Reorganized Equity Units and the Reorganized Preferred
Equity Units to certain classes of Creditors;
-- the payment in full of all allowed other secured claims;
-- the payment in full of all allowed priority non-tax claims;
-- the payment in full of all allowed unclassified claims;
-- The distribution of the stock of the reorganized Debtor; and
-- The cancellation of all outstanding interests in the
Debtors.
Summary of Treatment of Allowed Claims and Interests
In accordance with Sec. 1123(a)(1) of the Bankruptcy Code,
administrative claims and priority tax claims are not classified
under the Plan.
Administrative claimants will receive 100% payment in cash.
Holders of priority tax claims will receive (i) the amount of the
allowed claim in one cash payment or (ii) payment of the allowed
claim over a period not to exceed 5 years with interest.
The Plan segregates the allowed claims and interests into eight
classes.
Priority non-tax claims under Class 1 are unimpaired under the
Plan. Allowed Class 1 claims will be paid in full in cash.
Secured Claims of ACC Parties under Class 2, with estimated
Allowed Claims of $28,883,346, are impaired under the Plan.
Holders of Allowed Class 2 Claims will receive (i) 51% of the
stock of reorganized Luminent, (ii) $1,300,000, (iii) the
preferred stock of reorganized Luminent, and (iv) other
consideration as is provided under the terms of the Plan Support
Agreeement.
Other secured claims, classified under Class 3, are unimpaired
under the Plan. Allowed Class 3 claims will be paid in full.
General unsecured claims against Luminent under Classes 4(a) and
(b), with estimated allowed Claims of $297,054,107, are impaired
under Plan. Holders of Allowed 4(a) Claims will receive their
ratable portion of (i) of the fund allocated for unsecured
creditors, and (ii) 41% of the stock of reorganized Luminent.
Holders of Allowed Class 4(b) Claims will receive their ratable
portion of 41% of the stock of reorganized Luminent, taking into
account the holders of allowed claims in Classes (4)(a) and 5(b)
to determine the ratable portion.
Convenience class claims against Luminent under Classes 5(a) and
(b), with estimated Allowed Claims of $2,300,000, are impaired
under the Plan. Holders of Allowed Class 5(a) Claims will receive
their Ratable Portion of the Convenience Class Fund. Holders of
Allowed Class 5(b) Claims will receive their Ratable Portion of
41% of the Reorganized Equity Units, taking into account the
Holders of Allowed Claims in Classes (4)(a) and 4(b) to determine
such Ratable Portion.
Subordinated TRUPS Claims under Class 6, with estimated Allowed
Claims of $92,788,000, are impaired under the Plan. Allowed Class
6 Claims will not receive any property under the Plan.
Subsidiary Debtor Unsecured Claims under Class 7 are impaired
under the Plan. Allowed Class 7 Claims will not receive any
property under Plan.
Class 8 Interests are impaired under the Plan. Allowed Class 8
Interests will not receive any property under the Plan and will be
cancelled on the Effective Date.
Who May Vote
Only holders of claims in Classes 2, 4(a) and (b), and 5(a) and
5(b) are entitled to vote under the Plan.
Priority non-tax claims under Class 1 and Other Secured Claims
under Class 3 are not entitled to vote
Subordinated TRUPS Claims in Class 6, subsidiary debtor unsecured
claims in class 7, and interests in Class 8 are deemed to have
voted to reject the Plan.
Cramdown
Pursuant to the "cramdown" provisions of the Bankruptcy Code, the
Debtors may seek confirmation of the Plan, despite the non-
acceptance of one or more impaired Classes of Claims and or
Interests, as set forth in Sec. 1129(b) of the Bankruptcy Code.
Means of Implementation of the Plan
On the Effective Date, the Reorganized Debtors shall execute the
documents required to close and perform the transactions
contemplated by the Exit Financing Agreement. Proceeds from the
Exit Financing Agreement will be used to (i) repay the Debtors'
obligations to Arco under the DIP Facility, (ii) fund the
distribution to the ACC Parties required under the Plan, and
(iii) provide the Reorganized Debtors with working capital for
their business operations. In addition, on the Effective Date,
the ACC Parties shall fund the (i) Unsecured Distribution Fund
and (ii) the Convenience Class Fund, which amounts shall be
distributed by the Debtors to the Holders of Allowed Claims in
Classes 4(a) and 5(a) under the Plan.
Effective as of the Effective Date, the existing Interests of
Luminent shall be cancelled and Luminent shall issue both the
Reorganized Equity Units and the Reorganized Preferred Equity
Units and Luminent shall take such steps as are necessary to
memorialize the conversion from a public to a private company.
The Reorganized Equity Units shall be distributed as follows: (i)
51% to Arco, or its designee, on account of Arco's Allowed Class 2
Claims; (ii) 41% to Holders of Allowed Unsecured Claims in Classes
4(a), 4(b) and 5(b), or to the Disputed Claims Reserve to the
extent that Disputed Unsecured Claims exist; and (iii) 8% to
Reorganized Luminent to be distributed in accordance with the
employee incentive program described in the Plan Support
Agreement. All of the Reorganized Preferred Equity Units shall be
distributed to Arco, or its designee, in accordance with the Plan
Support Agreement and the Plan.
A full-text copy of the Debtors' Disclosure Statement, dated
Dec. 31, 2008, explaining the Debtors' First Amended Plan, is
available for free at:
http://bankrupt.com/misc/LuminentMortgageDS.pdf
About Luminent Mortgage
Luminent Mortgage Capital, Inc. (OTCBB: LUMCE) is a real estate
investment trust, or REIT, which, together with its subsidiaries,
has historically invested in two core mortgage investment
strategies. Under its Residential Mortgage Credit strategy, the
company invests in mortgage loans purchased from selected high-
quality providers within certain established criteria as well as
subordinated mortgage-backed securities and other asset-backed
securities that have credit ratings below AAA. Under its Spread
strategy, the company invests primarily in U.S. agency and other
highly-rated single-family, adjustable-rate and hybrid adjustable-
rate mortgage-backed securities.
Luminent and nine subsidiaries filed on Sept. 5, 2008, for relief
under Chapter 11 of the U.S Bankruptcy Code in the United States
Bankruptcy Court for the District of Maryland, Baltimore Division
(Lead Case No. 08-21389). Immediately prior to the filing, the
Debtor executed a Plan Support and Forbearance Agreement with
secured creditor Arco Capital Corp., Ltd., WAMU Capital Corp. and
convertible noteholders representing 100% of the outstanding
principal amount of its convertible notes.
Joel I. Sher, Esq., at Shapiro Sher Guinot & Sandler, represents
the Debtors as counsel. The U.S. Trustee for Region 4 appointed
creditors to serve on an Official Committee of Unsecured
Creditors. Jeffrey Neil Rothleder, Esq., at Arent Fox LLP,
represents the Creditors Committee as counsel.
In its operating report for the month of September 2008, Luminent
Mortgage Capital, Inc. reported $1,960,516 in total assets and
$374,868,632 in total liabilities, resulting in a $372,908,116
stockholders' deficit. Full-text copies of the Debtors' operating
report for September 2008 are available for free at:
http://researcharchives.com/t/s?345b
At March 31, 2008, Luminent Mortgage Capital, Inc.'s consolidated
balance sheet showed $3,757,205,000 in total assets,
$3,980,417,000 in total liabilities, and $223,212,000 in
stockholders' deficit.
Luminent and its debtor-subsidiaries continue to operate their
business as debtors-in-possession under the jurisdiction of the
Bankruptcy Court and in accordance with the applicable provisions
of the Bankruptcy Code and orders of the Bankruptcy Court.
LYONDELL CHEMICAL: Files for Chapter 11, Secures $8-Bil. DIP Loan
-----------------------------------------------------------------
LyondellBasell Industries' U.S. operations and one of its European
holding companies have filed voluntary petitions to reorganize
under Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009,
to facilitate a restructuring of the company's debts.
"We have been working collaboratively with our creditors and our
equity holder on a financial restructuring that reflects the
realities of today's market environment and positions us for the
future," said Volker Trautz, Chief Executive Officer.
"During the past two quarters, we have seen a dramatic softening
in demand for our products and unprecedented volatility in raw
materials costs. December was particularly difficult, as many of
our customers postponed orders to reduce their inventories.
Though we currently anticipate this situation to be short-term and
expect customers to increase their purchasing in 2009, we made the
decision to file Chapter 11 in order to provide the company with
the time and resources necessary to facilitate an orderly
restructuring and position the business for the long term.
"During the reorganization period, our goal is for the company to
continue its operations and its relationships with customers and
suppliers in the normal course," said Mr. Trautz.
The Chapter 11 filing applies to LyondellBasell's operations in
the United States and one of its European holding companies,
Basell Germany Holdings GmbH.
Mr. Trautz said that the company began taking steps to control
costs as demand began to weaken and raw material costs started to
fluctuate. "Over the past several months, we announced plans to
significantly reduce headcount and also reduced capital
expenditures and working capital," he said. "We have also idled
certain facilities and reduced production and processing at
others. We are aggressively exploring additional ways to lower our
costs and streamline operations in response to a very difficult
global economic environment.
"Our core businesses -- fuels, chemicals, plastics and technology
-- are fundamental to the global economy," Trautz said.
LyondellBasell's products are used in a broad range of
applications and in numerous products including: transportation,
fuels (gasoline and diesel), rigid and flexible packaging, plastic
pipe, detergents, cosmetics, electronics, appliances, automotive
parts, paints and coatings, furnishings, construction and building
materials and many other industrial and consumer goods
applications.
$8-Bil. DIP Financing
Pending Bankruptcy Court approval, the company has made
arrangements for up to $8 billion in debtor-in-possession
financing to fund continuing operations. Of this total, $3.25
billion consists of new funding; $3.25 billion represents a
refinancing of certain obligations under LyondellBasell's existing
senior secured credit facilities; and $1.515 billion represents
replacement of existing working capital facilities.
Lyondell has filed a motion before the Bankruptcy Court seeking
approval of the proposed DIP financing. An evidentiary hearing on
has been proposed for January 7, 2009, at 4:00 p.m. prevailing New
York time.
The DIP Facility consists of:
-- $1.515 billion of revolving credit secured by receivables
and inventory;
-- $3.25 billion of available term loans, secured by priming
liens; and
-- a modified roll-up of $3.25 billion in existing senior
secured debt, which will be secured by a priming lien junior
to the liens granted to lenders under the new revolving and
term loans and which will be subject to restructuring
pursuant to a plan of reorganization.
The maturity date of the facilities will be the earliest of: (i)
stated maturity, which will be December 15, 2009, (ii) the
effective date of any Chapter 11 plan of any Debtor, (iii) the
date that is 30 days after entry of an interim order approving hte
DIP loans if the Court has not granted final approval by that
date; and (iv) the acceleration of the loans or termination of the
commitments under either of the Facilities, including, without
limitation, as a result of the occurrence of an event of Default.
Plan Filing By May 2009
The docket for Lyondell's Chapter 11 cases provide that Lyondell's
Chapter 11 plan of liquidation or reorganization and the
explanatory disclosure statement is due by May 6, 2009. The
initial case conference will be on Feb. 5, 2009.
Kevin McShea Appointed CRO
As reported by the Jan. 4 issue of the Troubled Company Reporter,
pursuant to an agreement with lenders, the company's board has
approved the retention Kevin M. McShea of AlixPartners, LLP as
chief restructuring officer upon Lyondell's Chapter 11 filing.
Alix's subsidiary, AP Services LLC, will also provide temporary
staff and services to the company during its restructuring
process.
Aside from naming the attorneys and advisors the company will seek
to engage in the Chapter 11 process, the Board resolution
recommending the Chapter 11 filing also said that Alan S. Bigman
will be appointed as vice president of the company.
Non-U.S. Operating Entities Not Included
Seventy-nine Lyondell entities, including Equistar Chemicals, LP,
Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt
Industries, Inc., have filed for Chapter 11. LyondellBasell,
which is not part of the bankruptcy filing, notes that the Chapter
11 filing triggers an "automatic stay" that prevents anyone from
collecting debts owed by the company prior to the filing of the
Chapter 11 petition, such as payments to creditors and
bondholders.
LyondellBasell's non-U.S. operating entities are also not included
in the Chapter 11 filing. The non-U.S. entities, according to the
company, will continue their business operations without
supervision from the U.S. courts. They will not be subject to the
Chapter 11 requirements of the U.S. Bankruptcy Code.
$19 Billion in Debts
In the bankruptcy petition, Lyondell Chemicals estimated that
consolidated assets total $27.12 billion and debts total $19.34
billion as of the petition date.
Lyondell Chemical says that these entities directly or indirectly
own 10% or more of any class of its equity interests:
* LBIH LLC
* LyondellBasel1 Finance Company
* Basell Funding S.a.r.l.
* LyondellBasel1 Industries AF S.C.A.
* BI S.a.r.l.
* Nell Limited
* Leonard Blavatnik
* NAG Investments LLC
* AI Petrochemicals LLC
According to Bloomberg News, Apollo Management LP, is among the
largest creditors of Lyondell Chemical. Apollo, according to the
report, is part of the lender group providing Lyondell with the $8
billion in DIP financing.
Bloomberg recounts that Apollo bought Lyondell bank loans from
Citigroup Inc. in April, bankers familiar with the sale said at
the time. Citigroup sold about $1.9 billion of the debt, about a
fifth of a $9.45 billion term loan, Bloomberg adds, citing a
CreditSights Inc. report on April 29.
Out of Court Restructuring Difficult
Prior to LyondellBasell's filing for Chapter 11, analysts
including that of Credit Sights, as reported by Reuters, said that
LyondellBasell would mostly likely be going bankrupt. As reported
by the Troubled Company Reporter on Jan. 6, 2009, Societe Generale
mentioned LyondellBasell's possible bankruptcy in the next week or
two.
Reuters related that LyondellBasell has no near-term debt
maturities but "little room for maneuver," with the scale of its
debt and illiquid credit markets. According to the report, asset
sales would be time-consuming and wouldn't be sold at full value
in the current economic climate. The analysts, the report stated,
said that LyondellBasell would be able to save money through an
out-of-court restructuring but would it be difficult due to
falling cashflows, and securing agreement from diverse
stakeholders would be hard.
According to a filing with the Securities and Exchange Commission,
LyondellBasell said that softening demand combined with an
unprecedented fall in commodity prices had placed severe demands
on its liquidity. Citing Credit Sights analysts, Reuters reports
that LyondellBasell's liquidity has declined to $639 million
currently, from $1.67 billion at the end of the third quarter
2008, which is less than the quarterly cash requirements for
interest expenses and maintenance capex.
Lyondell filed for bankruptcy after the current financial crisis
reduced demands for plastics and chemicals used in homes and
automobiles. "They have no pricing power and volumes are down,"
said Gene Pisasale, who helps oversee about $13 billion at PNC
Capital Advisors in Baltimore, according to the Bloomberg report.
"With that combination, you're heading into the trough."
About LyondellBasell
LyondellBasell Industries -- http://www.lyondellbasell.com/-- is
a refiner of crude oil; a significant producer of gasoline
blending components; a global manufacturer of chemicals and
polymers, including polyolefins and advanced polyolefins; and the
leading developer and licensor of technologies for the production
of polymers.
Following the acquisition of Lyondell in 2007, LyondellBasell
became the world's largest independent producer of polypropylene
and advanced polyolefins products, a leading supplier of
polyethylene, and a global leader in the development and licensing
of polypropylene and polyethylene processes and related catalyst
sales. The group is estimated to generate 2007 revenues of US$44
billion and EBITDA of US$4.1 billion reflecting strong performance
of Lyondell and Basell businesses at the top of the cycle.
LyondellBasell is saddled with debt as part of its $12.7 billion
merger in 2007. As reported by the Troubled Company Reporter, the
company has brought on board Kevin M. McShea of AlixPartners, LLP
as Chief Restructuring Officer of LyondellBasell and its
subsidiaries. The company also has hired advisers, including
Evercore and New York law firm Cadwalader, Wickersham & Taft LLP,
to advise it on its restructuring efforts.
Lyondell disclosed in its latest quarterly results that it has
$27.12 billion in assets and $228 million stockholders' deficit as
of Sept. 30, 2008. It incurred a $232 million net loss in the
three months ended Sept. 30, 2008, compared to a $206 million net
profit during the same period in 2007.
Headquartered in Houston, Texas, Equistar Chemicals LP, is a
wholly owned subsidiary of Lyondell Chemical Company, which
produces ethylene, propylene and polyethylene in North America and
ethylene oxide, ethylene glycol, high value-added specialty
polymers and polymeric powder. For three months ended Sept. 30,
2008, Equistar Chemicals posted net loss of $271 million compared
to net income of $22 million for the same period in the previous
year. At Sept. 30, 2008, Equistar Chemicals' balance sheet showed
total assets of $9.0 billion and total liabilities of $19.0
billion, resulting in a partners' deficit of $9.9 billion.
* * *
As reported by the Troubled Company Reporter on Nov. 18, 2008,
Moody's Investors Service downgraded the Corporate Family Rating
of LyondellBasell Industries AF SCA to B3 from B1. The ratings on
the first lien facilities have been downgraded to B1/ LGD 2(27)
and the ratings on the legacy notes of Basell and Lyondell have
been downgraded to Caa2, with various LGD rates. LBI has
rearranged its USD 8 billion second lien facility into
US$5.5 billion second lien facilities and USD 2.5 billion third
lien facility. The new facilities have been rated Caa1/ LGD 5
(73) and Caa2/ LGD 5 (86) respectively. The outlook on the
ratings remains negative.
As reported by the TCR Europe on Nov. 26, 2008, Fitch Ratings
downgraded Netherlands-based petrochemicals company Lyondell
Basell Industries AF SCA's Long-term Issuer Default rating to
'B-'(B minus) from 'B+' while maintaining a Negative Outlook. At
the same time, Fitch affirmed LBI's Short-term IDR at 'B'.
LYONDELL CHEMICAL: Access Commits $750MM of $3.25B New Financing
----------------------------------------------------------------
Access Industries has committed to provide $750 million of the
total $3.25 billion of new money debtor-in-possession financing
arranged by LyondellBasell in conjunction with the filing of
LyondellBasell's U.S. operations as well as one European entity
for relief under Chapter 11 of the United States Bankruptcy Code.
As reported in today's Troubled Company Reporter, the bankrupt
LyondellBasell units have made arrangements for up to $8 billion
in DIP financing to fund continuing operations. Of this total,
$3.25 billion consists of new funding; $3.25 billion represents a
refinancing of certain obligations under LyondellBasell's existing
senior secured credit facilities; and $1.515 billion represents
replacement of existing working capital facilities
Access Industries' commitment demonstrates full support for
LyondellBasell's efforts to restructure its balance sheet amid the
global economic crisis and industry downturn and to reposition the
company for long-term success.
Contributing $750 million in funding makes Access one of the
largest contributors of new money funding raised as part of the
DIP facility. The Company's Chapter 11 petition remains subject
to Bankruptcy Court approval.
Access' commitment of $750 million represents one of the largest
DIP financing commitments by an owner of an independent industrial
concern over the past year. The scale of the financing reflects
Access' belief that LyondellBasell's underlying business is strong
and that the Company will be able to successfully emerge from
Chapter 11 in a competitive position.
Len Blavatnik, founder and Chairman of Access Industries, said:
"Access is committed to help LyondellBasell position for long-term
success by addressing the challenges caused by the global economic
crisis. Access' continued financial support reflects its
commitment to LyondellBasell and to the interests of the Company's
lenders, employees, customers and suppliers. We also appreciate
the strong support that the banks have provided the Company during
this difficult period."
Market conditions, which have negatively impacted both
LyondellBasell and the broader chemicals and petrochemicals
sectors, are expected to remain challenging in the near term.
LyondellBasell is undertaking a Chapter 11 restructuring to
position itself for recovery once stability returns to the credit
markets, raw materials pricing and global demand.
Upon approval from the Bankruptcy Court, LyondellBasell will use
the DIP financing to help fund the Company's ongoing operations as
it restructures its debt and improves its financial position.
LyondellBasell expects to retain its status as one of the world's
largest polymers, petrochemicals and fuels companies and the
world's third largest independent chemical company.
About Access Industries
Access Industries is a privately held, U.S.-based industrial group
with long-term holdings worldwide. Access was founded in 1986 by
Chairman, Len Blavatnik, an American industrialist. Access'
industrial focus spans three key sectors: natural resources and
chemicals; telecommunications and media; and real
About LyondellBasell
LyondellBasell Industries -- http://www.lyondellbasell.com/-- is
a refiner of crude oil; a significant producer of gasoline
blending components; a global manufacturer of chemicals and
polymers, including polyolefins and advanced polyolefins; and the
leading developer and licensor of technologies for the production
of polymers.
Following the acquisition of Lyondell in 2007, LyondellBasell
became the world's largest independent producer of polypropylene
and advanced polyolefins products, a leading supplier of
polyethylene, and a global leader in the development and licensing
of polypropylene and polyethylene processes and related catalyst
sales. The group is estimated to generate 2007 revenues of US$44
billion and EBITDA of US$4.1 billion reflecting strong performance
of Lyondell and Basell businesses at the top of the cycle.
LyondellBasell is saddled with debt as part of its $12.7 billion
merger in 2007. As reported by the Troubled Company Reporter, the
company has brought on board Kevin M. McShea of AlixPartners, LLP
as Chief Restructuring Officer of LyondellBasell and its
subsidiaries. The company also has hired advisers, including
Evercore and New York law firm Cadwalader, Wickersham & Taft LLP,
to advise it on its restructuring efforts.
Lyondell disclosed in its latest quarterly results that it has
$27.12 billion in assets and $228 million stockholders' deficit as
of Sept. 30, 2008. It incurred a $232 million net loss in the
three months ended Sept. 30, 2008, compared to a $206 million net
profit during the same period in 2007.
Headquartered in Houston, Texas, Equistar Chemicals LP, is a
wholly owned subsidiary of Lyondell Chemical Company, which
produces ethylene, propylene and polyethylene in North America and
ethylene oxide, ethylene glycol, high value-added specialty
polymers and polymeric powder. For three months ended Sept. 30,
2008, Equistar Chemicals posted net loss of $271 million compared
to net income of $22 million for the same period in the previous
year. At Sept. 30, 2008, Equistar Chemicals' balance sheet showed
total assets of $9.0 billion and total liabilities of $19.0
billion, resulting in a partners' deficit of $9.9 billion.
* * *
As reported by the Troubled Company Reporter on Nov. 18, 2008,
Moody's Investors Service downgraded the Corporate Family Rating
of LyondellBasell Industries AF SCA to B3 from B1. The ratings on
the first lien facilities have been downgraded to B1/ LGD 2(27)
and the ratings on the legacy notes of Basell and Lyondell have
been downgraded to Caa2, with various LGD rates. LBI has
rearranged its USD 8 billion second lien facility into
US$5.5 billion second lien facilities and USD 2.5 billion third
lien facility. The new facilities have been rated Caa1/ LGD 5
(73) and Caa2/ LGD 5 (86) respectively. The outlook on the
ratings remains negative.
As reported by the TCR Europe on Nov. 26, 2008, Fitch Ratings
downgraded Netherlands-based petrochemicals company Lyondell
Basell Industries AF SCA's Long-term Issuer Default rating to
'B-'(B minus) from 'B+' while maintaining a Negative Outlook. At
the same time, Fitch affirmed LBI's Short-term IDR at 'B'.
LYONDELL CHEMICAL: Case Summary & 50 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Lyondell Chemical Company
1221 McKinney Street
Houston, TX 77010
Bankruptcy Case No.: 09-10023
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Basell Finance USA Inc. 09-10021
HOISU Ltd. 09-10022
LBIH LLC 09-10025
Lyondell Europe Holdings Inc. 09-10026
LeMean Property Holdings Corporation 09-10027
Lyondell Houston Refinery Inc. 09-10028
Lyondell LP4 Inc. 09-10029
Lyondell Petrochemical L.P. Inc. 09-10030
Millennium America Inc. 09-10031
Circle Steel Corporation 09-10032
Basell USA Inc. 09-10033
Basell North American Inc. 09-10034
Duke City Lumber Company, Inc. 09-10035
Equistar Chemicals, LP 09-10036
Glidco Leasing, Inc. 09-10037
Houston Refining LP 09-10038
H.W. Loud Co. 09-10039
Glidden Latin America Holdings Inc. 09-10040
HPT 28 Inc. 09-10042
HPT 29 Inc. 09-10043
ISB Liquidating Company 09-10044
LBI Acquisition LLC 09-10045
IMWA Equities II, Co., L.P. 09-10047
Lyondell Asia Pacific Ltd.
Lyondell Chemical Delaware Company
Lyondell Chemical Espana Co.
Lyondell Chemical Europe Inc.
Lyondell Chemical International Co.
Lyondell Chemical Nederland Ltd.
Lyondell Chemical Products Europe LLC
Lyondell Chemical Properties LP
Lyondell Chemical Technology Management Inc.
Lyondell Chemical Technology 1 Inc.
Lyondell Chemical Technology LP
Lyondell Chimie France LLC
Lyondell-Equistar Holdings Partners
Lyondell Greater China Ltd.
Lyondell LP3 GP LLC
Lyondell LP3 Partners LP
Lyondell (Pelican) Petrochemical LP 1 Inc.
Lyondell Refining Company LLC
Lyondell Refining I LLC
LyondellBasell Advanced Polyolefins USA inc.
LyondellBasell Finance Company
MHC Inc.
Millennium America Holdings Inc.
Millennium Chemicals Inc.
Millennium Holdings LLC
Millennium Petrochemicals GP LLC
Millennium Petrochemicals Inc.
Millennium Petrochemicals LP LLC
Millennium Petrochemicals Partners LP
Millennium Realty Inc.
Millennium Specialty Chemicals Inc.
Millennium US Op Co. LLC
Millennium Worldwide Holdings I Inc.
MWH South America LLC
National Distillers & Chemical Corporation
NDCC International II Inc.
Nell Acquisition (US) LLC
Penn Export Company Inc.
Penn Navigation Company
Penn Shipping Company Inc.
PH Burbank Holdings Inc.
Power Liquidating Company Inc.
Quantum Acceptance Corporation
SCM Plants Inc.
Suburban Propane GP Inc.
Tiona Ltd.
UAR Liquidatiing Inc.
USI Chemicals International Inc.
USI Credit Corp.
USI Puerto Rico Properties Inc.
Walter Kidde & Company Inc.
Wyatt Industries Inc.
Type of Business: The Debtors are refiner of crude oil; a
significant producer of gasoline blending
components; a global manufacturer of chemicals
and polymers, including polyolefins and advanced
polyolefins; and the leading developer and
licensor of technologies for the production
of polymers.
Following the acquisition of Lyondell in 2007,
LyondellBasell became the world's largest
independent producer of polypropylene and
advanced polyolefins products, a leading
supplier of polyethylene, and a global leader in
the development and licensing of polypropylene
and polyethylene processes and related catalyst
sales. The group is estimated to generate 2007
revenues of US$44 billion and EBITDA of US$4.1
billion reflecting strong performance of
Lyondell and Basell businesses at the top of the
cycle.
http://www.lyondellbasell.com/
Chapter 11 Petition Date: January 6, 2009
Court: Southern District of New York (Manhattan)
Judge: Robert E. Gerber
Debtor's Counsel: Deryck A. Palmer, Esq.
deryck.palmer@cwt.com
Cadwalader, Wickersham & Taft LLP
One World Financial Center LLP
New York, NY 10281
Tel: (212)504-6000
Fax: (212)504-6666
Financial Advisor: Evercore Partners
55 East 52nd Street
New York, NY 10055
http://www.evercore.com
Tel: 212.857.3100
Fax: 212.857.3101
Restructuring
Advisor: Alix Partners and its subsidiary AP
Services LLC
Chief
Restructuring
Officer: Kevin M. McShea
AlixPartners, LLP
9 West 57th Street
Suite 3420
New York, New York 10019
http://www.alixpartners.com
Tel: 212.490.2500
Fax: 212.490.1344
Restructuring
Advisor to
European entities: Clifford Chance LLP
Total Assets: $27,117,000,000 as of Nov. 13, 2008
Total Debts: $19,337,000,000 as of Nov. 13, 2008
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York LyondellBasell $615,000,000
as Indenture Trustee Industries AF SCA EUR500,000,000
One Canada Square
48th Floor London
E14 5AL
England
Global Trust Services
Tel: 44-207-570-1784
Fax: 44-207-964-6030
The Bank of New York Millennium $241,395,000
as Indenture Trustee America Inc.
Attn: Christopher Greene 7.625% Senior
101 Barclay Street, 8 West unsecured notes
New York, NY 10286 due 2026
Tel: (212) 815-2923
Fax: (212) 815-2704
Petroles Der Venezuela SA trade debt $233,631,019
Attn: Alexis Reyes Balza
Edif Padvsa Torre Dests
Caracas, Venezuela
Tel: 58-212-708-1893
Fax: 58-212-708-3944
BASF Corp judgment $206,407,918
Attn: Christopher Landau
Kirkland & Ellis LLP
655 15th St., NW, Suite 1200
Washington, DC 20005
Tel: (202) 879-5087
Fax: (202) 879-5200
Sonatrach trade debt $206,407,918
Attn: F. Benouzid
Djenane El Malik Hydra
Algiers, Algeria 16035
Tel: (213) 2154-8011
Fax: (213) 2154-7700
GIM Channelview Congeneration trade debt $93,237,221
8580 Sheldon Road
Houston, Texas 77049
Tel: (212) 325-2542
Fax: (212) 322-2882
Linde Gas LLC trade debt $15,120,054
Attn: Ruth Ann Pruitt
Enterprises Texas Pipeline
889760 Expedite Way
Chicago, Il 60695
Tel: (713) 767-4136
Fax: (713) 767-4150
Calpine Corporation trade debt $12,000,000
Attn: Shirley Matthews
12000 Lawndale
Houston, TX 77017
Tel: (713) 456-1331
Fax: (713) 456-1335
Castor Americas Inc. trade debt $10,909,397
360 Madison Avenue, 19th flr.
New York, NY 10017
Enterprises Texas Pipeline trade debt $10,543,050
LLC
Attn: Mike Stevens
1100 Louisiana
Houston, TX 77002
Tel: (713) 381-6900
Fax: (713) 381-6573 or
(713) 381-788
Chevron Phillips Chemical trade debt $10,276,934
Co.
Attn: Erin Lane
10001 Six Pines Drive
The Woodlands, TX 77381
Tel: (832) 813-4839
Fax: (832) 813-6051
Air Products LLC trade debt $8,940,466
Attn: Ralph Alva
Dept. CH10200
Palatine, IL 60055
Tel: (713) 964-4054
Fax: (800) 545-4548
Air Liquide America Corp. trade debt $8,940,466
1091 PPG Drive
Westlake, LA 70669
Tel: (713) 896-2173
Fax: (713) 642-8030
SAP America Inc. trade debt $7,206,052
3999 W. Chester Pike
New Square, PA 19073
Tel: (610) 661-1000
Fax: (610) 661-4013
Jacobs Filed Services North trade debt $6,800,086
America
Attn: Mike Wagner
1401 Elm Street
Dallas, TX 75202
Tel: (713) 669-8400
Fax: (713) 321-6216
BASF Corporation trade debt $6,673,978
Attn: Gerald Flood
100 Campus Drive
Florham Park, NJ 07932
Tel: (713) 759-3092
Fax: (800) 634-9105
Wyatt Field Service Company trade debt $6,535,171
2060 North Loop West
Houston, TX 77018
Tel: (713) 684-4573
Fax: (713) 937-0931
Kirby Inland Marine trade debt $6,177,481
PO Box 200788
Houston, TX 77216-0788
Tel: (713) 435-1000
Fax: (713) 435-1515
Morris Congeneration LLC trade debt $5,033,947
Attn: Carolyn Gibson
33 South Grand Avenue
Suite 1570
Los Angeles, CA 90071
Tel: (815) 941-0765
Fax: (815) 941-1375
Veolia Environment Services trade debt $4,974,965
Attn: Vance Whatley
PO Box 70610
Chicago, IL 60673
Tel: (713) 307-2113
Fax: (713) 321-6001
Arco Midcon LLC trade debt $4,860,683
Attn: Janet Sabio
15600 JFK Blvd., Suite 300
Houston, TX 77032
Tel: (281) 366-4757
Fax: (713) 986-5426
Union Pacific Railroad trade debt $4,508,100
12567 Collections Center
Drive
Chicago, IL 60693
Tel: (402) 544-0211
Fax: (402) 501-0027
BEELINE.COM Inc. trade debt $3,941,868
12724 Gran Bay Pkwy.
W. Suite 200
Jacksonville, FL 32258
Tel: (713) 309-3203
Fax: (904) 527-5827
Brock Services Ltd. trade debt $3,915,346
Attn: Paul Brown
2022 Humble Place Drive
Humble, TX 77338
Tel: (409) 838-2282
Fax: (713) 321-4582
Chemtrade Refinery Services trade debt $3,765,034
Inc.
Attn: Diana Piva
PO Box 30
Beaumont, TX 77704
Tel: (416) 496-4148
Fax: (281) 446-1729
Norfolk Southern trade debt $3,744,752
Attn: Bridget Baldwin
PO Box 532729
Atlanta, GA 30353
Tel: (404) 529-2209
Fax: (404) 589-6740
Arcardis trade debt $3,570,657
4815 Prospectus Drive
Durham, NC 27713
Tel: (919) 544-4535
Fax: (281) 497-7258
Computer Services Corp. trade debt $3,509,883
3179 Fairview Park Dr.
Falls Church, VA 22042
Tel: (703) 876-1000
Fax: (703) 641-3990
Westlake Petrochemical trade debt $3,500,314
Corporation
Attn: Peter Kestner
2801 Post Oak Blvd.
Houston, TX 77056
Tel: (713) 585-2921
Fax: (337) 583-4996
Kellog, Brown & Root trade debt $3,410,715
Industrial
PO Box 951009
Dallas, TX 75395
Tel: (214) 752-8300
Fax: (214) 752-8366
Chevron Products Company trade debt $3,403,234
Attn: Valerie Booth
Chevron Products
1400 Smith St.
Houston, TX 77002
Tel: (713) 372-5286
Fax: (281) 582-5732
S&B Engineering & trade debt $3,312,809
Contractors
7825 Park Place Blvd.
Houston, TX 77087
Tel: (713) 845-4024
Fax: (713) 847-5327
Austin Industrial trade debt $3,295,071
PO Box 87888
Houston, TX 77287
Tel: (713) 641-3400
Fax: (713) 641-2424
Catalyst Service Inc. trade debt $3,206,830
Attn: Paul Chaskey
PO Box 201143
Dallas, TX 75320
Tel: (281) 471-5522
Fax: (281) 478-2693
Stolt Tankers trade debt $3,155,250
800 Connecticut Avenue
4th Floor East
Norwalk, CT 06854
Tel: (203) 838-7100
Fax: (281) 860-5145
CIBO Specialty Chemicals trade debt $3,152,745
Attn: Kendal Goodell
PO Box 3475
Tulsa, OK 74101
Tel: (918) 615-7941
Fax: (918) 615-7023
JV Industrial Companies Ltd. trade debt $3,119,377
2221 Sens Road
La Porte, TX
Tel: (281) 842-9353
Fax: (281) 471-9353
A. Schulman Inc. trade debt $3,101,798
3550 W. Market Street
Suite 300
Akron, OH 44333
Tel: (248) 643-6100
Fax: (248) 643-7839
BP Products North American trade debt $3,089,011
Inc.
PO Box 3092
Houston, TX 77253
Tel: (281) 366-4331
Fax: (281) 366-7546
Tauber Oil Inc. trade debt $3,024,000
PO Box 4645
Houston, TX 77210
Tel: (713) 869-8700
Fax: (713) 879-8069
Burlington Northern Santa Fe trade debt $2,966,815
Attn: Todd Whitmore
3115 Solutions Center
Chicago, IL 60677
Tel: (785) 435-3637
Fax: (785) 436-6767
Basic Industries trade debt $2,847,272
PO Box 1334
Houston, TX 77251
Tel: (225) 756-7660
Fax: (713) 675-8691
ExxonMobil Chemical Co. trade debt $2,847,272
Attn: Deanna Foltyn
13501 Katy Freeway
Houston, TX 77079
Tel: (281) 870-6848
Fax: (304) 747-2154
Sunoco Chemicals trade debt $2,732,611
8811 Strang Road
La Porte, TX 77571
Tel: (281) 476-0303
Fax: (281) 930-2070
CDI Engineering Group Inc. trade debt $2,717,576
PO Box 88924
Chicago, IL 60695-1924
Tel: (713) 354-0602
Fax: (713) 309-2086
Marathon Petroleum Company trade debt $2,705,279
LLC
PO Box 3128
Houston, TX 77253
Tel: (713) 629-6600
Fax: (419) 421-4565
Methanex Methanol Company trade debt $2,674,473
15301 Dallas Pkwy, Suite 1150
Addison, TX 75001
Tel: (972) 308-0412
Fax: (972) 960-7908
Centerpoint Energy Gas Rec. trade debt $2,630,177
LLC-CGSI
Attn: Mary Trevino
PO Box 200905
Houston, TX 77216
Tel: (713) 207-3503
Fax: (713) 951-1689
The petition was signed by vice-president Alan S. Bigman.
LYONDELL CHEMICAL: Top 5 Creditors Holding Secured Claims
---------------------------------------------------------
Lyondell Chemical Inc. has submitted a list of parties holding the
five largest secured claims against it:
ABN AMRO Bank N.V. $3,472,260,851 Certain material
Beethovenstrasse 33, CH-8002 assets of certain
P.O. Box 5239 of the Debtors
Zurich, N.L. Switzerland
Tel: 001-31-20-629-1665
UBS Loan Finance LLC $2,704,352,101 Certain material
677 Washington Blvd. assets of certain
Stamford, CT 06901 of the Debtors
Tel: 203-719-4308
Citibank, N.A. $2,647,354,259 Certain material
320 Park Avenue, 30th Floor assets of certain
New York, NY 10043 of the Debtors
Tel: 302-894-6059
Merrill Lynch Capital $2,155,377,543 Certain material
Corporation assets of certain
250 Vesey Street of the Debtors
New York, NY 10281
Tel: 212-449-7839
LeverageSource III S.a.r.l. $2,028,215,736 Certain material
1 Manhattanville Road asserts of certain
Suite 201 of the Debtors
Purchase, NY 10577
MERISANT WORLDWIDE: Moody's Downgrades Corporate Ratings to 'Ca'
----------------------------------------------------------------
Moody's Investors Service lowered the ratings of Merisant
Worldwide, Inc., including the company's probability of default
and corporate family ratings to Ca from Caa3. The ratings of the
first lien bank facilities of subsidiary Merisant Company were
also downgraded. These rating actions are based on Moody's
concern that, given the current bank credit markets and the
company's weak credit metrics, Merisant may not be able to
refinance its revolving credit agreement and term loan A, which
mature on January 11, 2009. These maturities increase the
likelihood of a distressed exchange or bankruptcy filing. The
rating outlook is negative.
Ratings lowered, and certain LGD percentages adjusted:
Merisant Worldwide, Inc.
-- Corporate family rating to Ca from Caa3
-- Probability of default rating to Ca from Caa3
-- $137 million (accreted value) 12.25% senior subordinated
discount notes maturing May 2014 to C (LGD6,90%) from Ca
(LGD6,91%)
Merisant Company
-- $35 million senior secured revolving credit expiring in
January 2009 to Caa1 (LGD2,16%) from B3 (LGD2,16%)
-- Senior secured Term Loan A (current balance approximately
$7.4 million) maturing in January 2009 to Caa1 (LGD2,16%)
from B3 (LGD2,16%)
-- Senior secured Term Loan B (current balance approximately
$174 million) maturing in January 2010 to Caa1 (LGD2,16%)
from B3 (LGD2,16%)
Rating affirmed:
Merisant Company
-- $225 million 9.5% senior subordinated notes maturing in July
2013 at Ca (LGD4,63)
Global competition from well capitalized Splenda(R)(produced by a
subsidiary of Johnson & Johnson) has eroded sales and market share
over the past several years. Leverage also increased in 2003 to
fund an equity distribution. For the twelve months ended
September 30, 2008 debt to EBITDA was unsustainable at
approximately 25 times. The company's weak credit metrics
severely limit its financial flexibility, especially in the
current credit market.
However, Merisant does have growth prospects with the recently
launched PureVia(TM), an all natural zero calorie sweetener. A
Merisant subsidiary has a partnership with PepsiCo to jointly own
the PureVia(TM) trademark and market the brand globally.
Merisant's Whole Earth subsidiary owns the trademark for tabletop
sweeteners and PepsiCo for beverages and certain food categories.
The U.S. Food and Drug Administration recently issued a no
objection letter with respect to Rebaudioside A, the stevia
extract used in PureVia(TM). Given the potential for PureVia(TM)
to offset the decline in Merisant's aspartame-based sweeteners,
Moody's anticipates that recovery levels in any default would be
average.
Moody's most recent rating action on April 4, 2008 withdrew the
ratings on Merisant Company's proposed new bank agreements, when
the transactions were withdrawn from the market, and affirmed all
other ratings.
Headquartered in Chicago, Merisant Worldwide, Inc. is a leading
global producer and marketing of low-calorie and zero calorie
tabletop sweeteners, including Equal(R) and PureVia(TM). Equal(R)
is sweetened with aspartame. Sales were approximately
$277 million for the twelve months ended September 30, 2008.
MERRILL LYNCH: Completes Sale to Bank of America
------------------------------------------------
Bank of America Corporation has completed its purchase of Merrill
Lynch & Co., Inc., creating a premier financial services franchise
with significantly enhanced wealth management, investment banking
and international capabilities.
As reported by the Troubled Company Reporter on Dec. 1, 2008, BofA
agreed to acquire Merrill for roughly $44 billion -- or $29 a
share. The agreed price for Merrill is about two-thirds of its
value last year and half its all-time peak value of early 2007.
BofA Chairperson and CEO Ken Lewis said, "We created this new
organization because we believe that wealth management and
corporate and investment banking represent significant growth
opportunities, especially when combined with our leading
capabilities in consumer and commercial banking. We are now
uniquely positioned to win market share and expand our leadership
position in markets around the world."
BofA will have the largest wealth management business in the world
with approximately 20,000 financial advisors and more than $2
trillion in client assets. Global investment management
capabilities will include approximately 50% ownership in BlackRock
Inc., which at September 30 had $1.26 trillion in assets under
management. BofA had $564 billion in assets under management in
the same period.
The combination strengths in debt and equity underwriting, sales
and trading, and merger and acquisition advice, creating
significant opportunities to deepen relationships with corporate
and institutional clients around the globe.
Under terms of the agreement, shareholders of Merrill Lynch
received about 0.8595 shares of BofA common stock for each common
share of Merrill Lynch.
As previously disclosed, Bank of America expects to achieve
$7 billion in pre-tax expense savings, fully realized by 2012.
Cost reductions will come from a range of sources, including the
elimination of positions announced on December 11, and the
reduction of overlapping technology, vendor and marketing
expenses. In addition, the company is expected to benefit by
leveraging its broad product set to deepen relationships with
existing Merrill Lynch customers.
About Merrill Lynch
Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth
management, capital markets and advisory companies with offices in
40 countries and territories. As an investment bank, it is a
leading global trader and underwriter of securities and
derivatives across a broad range of asset classes and serves as a
strategic advisor to corporations, governments, institutions and
individuals worldwide. Merrill Lynch owns approximately half of
BlackRock, one of the world's largest publicly traded investment
management companies with more than $1 trillion in assets under
management. Merrill Lynch's operations are organized into two
business segments: Global Markets and Investment Banking (GMI) and
Global Wealth Management (GWM). GMI provides service global
markets and origination products and services to corporate,
institutional, and government clients around the world. GWM
creates and distributes investment products and services for
individuals, small- and mid-size businesses, and employee benefit
plans.
As reported by the Troubled Company Reporter on September 15,
2008, Merrill has had tens of billions of dollars worth of risky,
illiquid assets carried on balance sheets that were leveraged at a
debt-to-equity ratio of more than 20 to one in the past 15 months.
The Wall Street Journal said that when the crisis started, the
assets kept deteriorating in value and couldn't easily be sold,
eating into the firm's capital cushion. Merrill's balance sheet
topped $900 billion recently, WSJ added. As reported by the TCR
on October 21, 2008, Merrill disclosed a
net loss from continuing operations for the third quarter of 2008
of $5.1 billion, compared with a net loss from continuing
operations of $2.4 billion for the third quarter of 2007.
Merrill's net loss for the third quarter of 2008 was
$5.2 billion, compared with a net loss of $2.2 billion, for the
year-ago quarter.
MERRILL LYNCH: Robert McCann Leaves Brokerage Chief Post
--------------------------------------------------------
Randall Smith and Susanne Craig at The Wall Street Journal report
that Robert McCann, Merrill Lynch & Co.'s brokerage chief has
decided to resign from the firm, after its acquisition by Bank of
America Corp. was completed.
Dan Sontag, a top deputy, would take Mr. McCann's post, WSJ says.
As reported by the Troubled Company Reporter on Dec. 1, 2008, Bank
of America Corp. agreed to acquire Merrill Lynch for $44 billion.
The agreed price for Merrill is about two-thirds of its value last
year and half its all-time peak value of early 2007. WSJ relates
that the takeover closed on Jan. 1, 2009.
According to WSJ, people familiar with the matter wondered if the
cost-conscious culture of BofA would blend with Merrill's big-
spending Wall Street culture. The report says that Merrill caters
to rich clients.
WSJ relates that Mr. McCann has been working for Merrill for 26
years, leading the 16,850-member brokerage force. According to
the report, he was recently the vice chairperson and president of
global wealth management, and came up with a successful retention
package to urge brokers to stay on after the acquisition.
Mr. McCann's responsibilities, WSJ reports, narrowed slightly in a
new lineup set in October 2008 by BofA, which said at that time
that a new executive will handle a higher-ranking "global wealth
and investment management" job.
WSJ states that tensions between John Thain and Mr. McCann
surfaced publicly after the deal with BofA was reached. Mr. Thain
was Merrill's CEO until becoming president of the combined
company's global banking, securities and wealth-management
division, WSJ says.
About Merrill Lynch
Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth
management, capital markets and advisory companies with offices in
40 countries and territories. As an investment bank, it is a
leading global trader and underwriter of securities and
derivatives across a broad range of asset classes and serves as a
strategic advisor to corporations, governments, institutions and
individuals worldwide. Merrill Lynch owns approximately half of
BlackRock, one of the world's largest publicly traded investment
management companies with more than $1 trillion in assets under
management. Merrill Lynch's operations are organized into two
business segments: Global Markets and Investment Banking (GMI) and
Global Wealth Management (GWM). GMI provides service global
markets and origination products and services to corporate,
institutional, and government clients around the world. GWM
creates and distributes investment products and services for
individuals, small- and mid-size businesses, and employee benefit
plans.
As reported by the Troubled Company Reporter on September 15,
2008, Merrill has had tens of billions of dollars worth of risky,
illiquid assets carried on balance sheets that were leveraged at a
debt-to-equity ratio of more than 20 to one in the past 15 months.
The Wall Street Journal said that when the crisis started, the
assets kept deteriorating in value and couldn't easily be sold,
eating into the firm's capital cushion. Merrill's balance sheet
topped $900 billion recently, WSJ added. As reported by the TCR
on October 21, 2008, Merrill disclosed a
net loss from continuing operations for the third quarter of 2008
of $5.1 billion, compared with a net loss from continuing
operations of $2.4 billion for the third quarter of 2007.
Merrill's net loss for the third quarter of 2008 was
$5.2 billion, compared with a net loss of $2.2 billion, for the
year-ago quarter.
MICHAEL VICK: Files Amended Reorganization Plan in Court
--------------------------------------------------------
Savannahnow.com reports that Michael Vick's attorneys have filed a
revised reorganization plan in the U.S. Bankruptcy Court for the
Eastern District of Virginia.
As reported by the Troubled Company Reporter on Dec. 12, 2008, Mr.
Vick submitted to the U.S. Bankruptcy Court for the Eastern
District of Virginia a Chapter 11 plan and a disclosure statement
explaining the plan. Under the plan, Mr. Vick will pay creditors
from his assets and earnings if he is reinstated by the NFL.
Mr. Vick's major creditors filed an objection on his disclosure
statement, claiming that it lacks sufficient detail about the
debtor's finances and prospects of returning to the NFL.
A committee representing Michael Vick's creditors endorsed the
amended Plan and asked the creditors to vote for its confirmation,
Savannahnow.com relates.
Savannahnow.com says that under the Plan, would have to keep a
court official informed about his attempts to be reinstated by the
National Football League, after his release from prison.
Michael Vick filed for Chapter 11 protection on July 7, 2008
(Bankr. E.D. Va. Case No. 08-50775). Dennis T. Lewandowski, Esq.,
and Paul K. Campsen, Esq., at Kaufman & Canoles, P.C., represent
Mr. Vick in his bankruptcy case. Mr. Vick listed assets of
$16.1 million and debts of $20.4 million in his bankruptcy filing.
MICRON TECHNOLOGY: Moody's Withdraws 'B1' Ratings
-------------------------------------------------
Moody's Investors Service has withdrawn these ratings for Micron
Technology, Inc.:
* Corporate Family Rating - B1
* Probability of Default Rating -- B1
* Senior Unsecured Shelf Registration -- (P)B2 (LGD-4, 62%)
* Subordinated Shelf Registration -- (P)B3 (LGD-6, 96%)
* Speculative Grade Liquidity -- SGL-3
Moody's has withdrawn these ratings for business reasons as this
issuer's shelf registrations are either fully utilized or expired,
and the issuer has no rated debt outstanding.
Micron's ratings were assigned by evaluating factors Moody's
believe are relevant to the credit profile of the issuer, such as:
(i) the business risk and competitive position of the company
versus others within the industry; (ii) the capital structure and
financial risk of the company; (iii) the projected performance of
the company over the near-to-intermediate term; and (iv)
management's track record and tolerance for risk. These
attributes were compared against other issuers both within and
outside of Micron's core industry and Micron's ratings are
believed to be comparable to those of other issuers of similar
credit risk.
The last rating action was on October 15, 2008 when the Corporate
Family Rating was lowered to B1 from Ba3 and the Speculative Grade
Liquidity Rating was lowered to SGL-3 from SGL-2. At that time,
Moody's maintained the negative ratings outlook.
NAVISTAR INTL: Files Amendments to 2008 Quarterly Reports
---------------------------------------------------------
Management of Navistar International Corporation, with the
concurrence of the company's Audit Committee, concluded on
December 23, 2008, that the company's previously issued unaudited
financial statements as of and for the three and nine months ended
July 31, 2008, should no longer be relied upon because of errors
that when restated would modestly increase the company's net
income for the three and nine months ended July 31, 2008. The
company further stated that its review process was continuing and
may extend to the first and second quarters of 2008.
On December 29, 2008, management, with the concurrence of the
Audit Committee, further concluded that the matters extended into
the first and second quarter of 2008 and, as such, the company's
previously issued unaudited financial statements as of and for the
three months ended January 31, 2008, and as of and for the three
and six months ended April 30, 2008, should no longer be relied
upon because of the errors within the company's Truck segment
relating to accounting for inventory, accounts payable and costs
of products sold.
Management and the Audit Committee have discussed these matters
with the company's Independent Registered Public Accounting Firm,
KPMG LLP.
On December 31, 2008, Navistar filed with the Securities and
Exchange Commission amendments to its report for:
-- the quarterly period ended July 31, 2008, a full-text copy
of which is available at no charge at:
http://ResearchArchives.com/t/s?3753
Navistar says the changes to the Third Quarter Form 10-Q
have the effect of increasing net income by $59 million
and $43 million for the three and nine months ended
July 31, 2008, respectively.
-- the quarterly period ended April 30, 2008, a full-text copy
of which is available at no charge at:
http://ResearchArchives.com/t/s?3754
Navistar says the amendments to the Second Quarter Form
10-Q have the effect of decreasing net income by $4 and
$16 million for the three and six months ended
April 30, 2008, respectively.
-- the quarterly period ended January 31, 2008, a full-text
copy of which is available at no charge at:
http://ResearchArchives.com/t/s?3755
Navistar says the corrections to the First Quarter Form
10-Q have the effect of increasing net loss by $12 million
for the three months ended January 31, 2008.
About Navistar International Corporation
Based in Warrenville, Illinois, Navistar International Corporation
(NYSE: NAV) produces International(R) brand commercial and
military vehicles, MaxxForce(TM) brand diesel engines, IC brand
school and commercial buses, and Workhorse(R) brand chassis for
motor homes and step vans, and is a private label designer and
manufacturer of diesel engines for the pickup truck, van and SUV
markets. Navistar is also a provider of truck and diesel engine
parts. Another affiliate offers financing services.
NAVISTAR INTL: October 31 Balance Sheet Upside Down by $1.4BB
-------------------------------------------------------------
Navistar International Corporation reported near record earnings
excluding asset impairment charges and record revenues for the
fiscal year that ended October 31, 2008, as the company continued
to execute its strategy, delivering strong financial results.
Revenues increased 20% to $14.7 billion from $12.3 billion a year
ago primarily driven by increases in sales to the U.S. military of
$3.5 billion. Despite a continuing weak truck industry, Navistar
reported a profit for 2008 compared with a loss in fiscal 2007,
demonstrating that its overall strategy is working.
Navistar had $10.3 billion in total assets and $11.7 billion in
total liabilities, resulting in $1.4 billion in stockholders'
deficit as of October 31. The company also had $2.3 billion in
accumulated deficit as of October 31.
"Our strategy of building great products, achieving a more
competitive cost structure and finding profitable growth
opportunities has enabled us to fundamentally change our
profitability even in these turbulent economic times," said Daniel
C. Ustian, Navistar chairman, president and chief executive
officer.
According to Mr. Ustian, major factors in the company's 2008
performance were increased sales to the military, increased market
share in the Class 8 segment, led by the International(R)
ProStar(R) with industry-leading fuel efficiency, growth in South
American engine sales and expansion into global markets.
"We have achieved this substantial progress by diversifying and
expanding into new business opportunities with little capital
investment as well as leveraging our core strengths and the
strengths of companies that have become our partners," he said.
Navistar reported a loss for the current fourth quarter of
$343 million, compared with a loss of $103 million, in the fourth
quarter a year ago. For the full fiscal year ended Oct. 31, 2008,
the company demonstrated solid progress in its business strategy
by delivering net income of $134 million, and manufacturing
segment profit of $719 million, compared with a loss of $120
million, and manufacturing segment profit of
$426 million in fiscal 2007. Included in its 2008 fourth quarter
and full year results are asset impairment charges of
$358 million and other costs of $27 million and $37 million, for
the quarter and full year respectively, related to its diesel
engine business for Ford pickups.
Excluding the asset impairment charges and other costs related to
the company's diesel engine business with Ford, net income for
fiscal 2008 were $529 million, and manufacturing segment profit
was $1.1 billion, which would reflect near record earnings for the
company in a tough North American truck market.
Throughout fiscal 2008, Navistar has taken significant actions to
enhance its liquidity in the midst of the broad credit crisis.
"Our fiscal 2008 results are reflective of the company's sound
execution of our three-pillar strategy of great products,
competitive cost structure and profitable growth and has put us on
the right path to successfully navigate through this severe
economic downturn and expected continued weakness in the North
American truck market," said Terry M. Endsley, Navistar executive
vice president and chief financial officer.
A full-text copy of Navistar's Form 10-K for fiscal year ended
October 31, 2008, is available at no charge at:
http://ResearchArchives.com/t/s?3756
About Navistar International Corporation
Based in Warrenville, Illinois, Navistar International Corporation
(NYSE: NAV) produces International(R) brand commercial and
military vehicles, MaxxForce(TM) brand diesel engines, IC brand
school and commercial buses, and Workhorse(R) brand chassis for
motor homes and step vans, and is a private label designer and
manufacturer of diesel engines for the pickup truck, van and SUV
markets. Navistar is also a provider of truck and diesel engine
parts. Another affiliate offers financing services.
NXTV INC: ORIX to Hold Public Auction of Collateral on Jan. 13
--------------------------------------------------------------
ORIX Venture Finance LLC will conduct a public sale on Jan. 13,
2009, at the offices or Richards Kibbe & Orbe LLP, One World
Financial Center, 29th Floor, in New York, without reserve of all
right, title and interest of NxTV, Inc., in and to certain
accounts, inventory, equipment, general intangibles (including
intellectual property and deposit accounts), Investment property
and other property held by ORIX as collateral in connection with
outstanding indebtedness owed to it by NxTV, Inc., in the
principal amount of not less than $4,401,253.
The sale of the Collateral is subject to certain bidding
procedures and any prospective bidder must enter into a
confidentiality agreement with the Lender in order to be eligible
to receive any due diligence materials or to participate and bid
at the sale.
The Lender makes no representation as to the Collateral. All
sales will be without recourse or warranty. The Collateral may be
sold in bulk or in separate lots.
The Lender reserves the right to bid for and purchase the
Collateral and to credit the purchase price therefrom against the
respective debts owing to the Lender and any costs of the sale.
The Lender also reserves the right to amend, adjourn, postpone or
cancel the sale with respect to all or part of the Collateral
without notice.
All questions and inquiries concerning the sale should be
addressed to:
Larry G. Halperin, Esq.
Richards Kibbe & Orbe, LLP
One World Financial Center
29th Floor, New York
New York 10281
Tel: (212) 530-1800
Based in Los Angeles, NxTV, Inc., is a provider of digital in-room
entertainment, voice and data services to the worldwide luxury
hotel market. The company serves many of the most prestigious
hospitality brands in the world including Four Seasons, Peninsula,
W Hotels, St. Regis, Le Meridien, Omni, Raffles, JW Marriott,
Harrah's and Kerzner International. NxTV has international
offices in Hong Kong and London.
NXTV INC: Vogen to Hold Public Auction of Collateral on Jan. 13
---------------------------------------------------------------
Vogen Funding, L.P., a Delaware limited partnership, will conduct
on Jan. 13, 2009, at the offices or Richards Kibbe & Orbe LLP, One
World Financial Center, 29th Floor, in New York, a public sale
without reserve of all right, title and interest of NxTV, Inc., in
and to certain equipment, accounts, general intangibles and other
property held by Vogen as collateral in connection with
outstanding indebtedness owed to it by NxTV, Inc., in the
principal amount of not less than $6,100,000.
The sale of the Collateral is subject to certain bidding
procedures and any prospective bidder must enter into a
confidentiality agreement with Vogen in order to be eligible to
receive any due diligence materials or to participate and bid at
the sale.
Vogen makes no representation as to the Collateral. All sales
will be without recourse or warranty. The Collateral may be sold
in bulk or in separate lots.
Vogen reserves the right to bid for and purchase the Collateral
and to credit the purchase price therefrom against the respective
debts owing to the Lender and any costs of the sale. The Lender
also reserves the right to amend, adjourn, postpone or cancel the
sale with respect to all or part of the Collateral without notice.
All questions and inquiries concerning the sale should be
addressed to:
Scott A. Josephson, Esq.
Horwood Marcus & Berk Chartered
280 North LaSalle Street, Suite 3700
Chicago, Illinois 60601
Tel: (312) 606-3200
Based in Los Angeles, NxTV, Inc. is a provider of digital in-room
entertainment, voice and data services to the worldwide luxury
hotel market. The company serves many of the most prestigious
hospitality brands in the world including Four Seasons, Peninsula,
W Hotels, St. Regis, Le Meridien, Omni, Raffles, JW Marriott,
Harrah's and Kerzner International. NxTV has international
offices in Hong Kong and London.
ODYNE CORP: Runs Out of Options, to Wind Down Operations
--------------------------------------------------------
Odyne Corporation will be suspending operations. In October 2008,
Odyne retained Matrix USA, LLC to explore strategic alternatives.
These efforts have not been successful. The company said that,
after careful consideration, it has determined to wind-down its
operations, terminate substantially all of its employees,
discontinue its operating leases, resolve its outstanding
liabilities and liquidate its remaining assets.
Odyne Corporation (ODYC) -- http://www.odyne.com/-- in Happaugue,
New York, is a clean technology company that develops and
manufactures propulsion systems for advanced Plug-in Hybrid
Electric Vehicles (PHEV), specifically medium and heavy-duty
trucks and buses. The company has developed a proprietary system
combining electric power conversion, power control and energy
storage technology, with standard electric motors, storage
batteries and other off the shelf components that enables vehicles
to have lower fuel, operating and maintenance costs with
substantially lower emissions.
Odyne had $5.6 million in total assets, $4.4 million in total
liabilities, and $13.1 million in accumulated deficit as of
September 30, 2008.
PACIFIC LIFESTYLE: May Obtain DIP Loan of $1,700,000 from K. Wann
-----------------------------------------------------------------
The U.S. Bankruptcy for the Western District of Washington granted
Pacific Lifestyle Homes, Inc. authority to obtain a debtor-in-
possession loan in the amount of $1,700,000 from Kevin and Nicki
Wann, husband and wife, to pay operating expenses, including
property taxes, utility costs, maintenance costs and general
overhead, in accordance with a Budget.
The Debtor told the Court that it is unable to obtain unsecured
credit allowable under either Sections 364(b) and 503(b)(1) of the
Bankruptcy code, or Sec. 364(c)(1) of the Bankruptcy Code.
The DIP Loan, and any accrued and unpaid interest, shall be due
and payable on the earlier of (a) Nov. 30, 2009, (b) the entry of
an order converting the case to one under Chapter 7 of the
Bankruptcy Code, (c) the entry of an order dismissing the case,
(d) the entry of an order appointing a trustee or examiner for the
Debtor, or (e) the entry of an order confirming a plan of
reorganiation in the Debtor's Chapter 11 case.
Interest will be at 5.75% p.a, payable on the first day of each
month.
Kevin and Nicki Wann are granted an allowed super-priority
administrative claim pursuant to Sec. 364(c) of the Bankruptcy
Code, over any and all administrative expenses, subject to a
Carve-Out for (a) amounts payable pursuant to Title 28 Sec.
1930(a)(6) of the U.S. Code and fees payable to the clerk of the
Court; and (b) allowed, unpaid postpetition fees and expenses of
attorneys, accountants, and other professionals retained in the
case by Debtor or the Official Committee of Unsecured Creditors.
The allowed superpriority claims of Kevin and Nicki Wann shall be
payable from and have recourse to all prepetition and postpetition
property of the Debtor.
As collateral for the DIP Loan, Kevin and Nicki Wann are granted
first priority liens on and security interests in all now owned or
hereafter acquired assets and property of the Debtor that are not
otherwise subject to liens, and junior liens on and security
interests in all now owned or herafter acquired assets and
property of the Debtor that are subject to liens, provided that
all DIP liens shall be subject to the aforementioned Carve-Out.
The liens and security interests granted to secure the DIP Loan
shall include, without limitation, all proceeds, products,
accessions, rents and profits with respect to any collateral, but
shall not include avoidance claims and causes of action under
Chapter 5 of the Bankruptcy Code.
Based in Vancouver, Washington, Pacific Lifestyle Homes, Inc.,
claims to be one of the largest homebuilders in Southwest
Washington and Northern Oregon. The company filed for Chapter 11
relief on Oct. 16, 2008 (Bankr. W.D. Wash. Case No. 08-45328).
Steven M. Hedberg, Esq., Brian A. Jennings, Esq., and Jeanette L.
Thomas, Esq., at Perkins Coie LLP, in Portland, Oregon, represent
the Debtor as counsel. When the Debtor filed for protection from
its creditors, it listed assets and debts of between $50 million
and $100 million each.
PARENT CO: Organizational Meeting to Form Panel on January 8
------------------------------------------------------------
Roberta A. DeAngelis, the Acting United States Trustee for Region
3, will hold an organizational meeting on January 8, 2009, at 1:00
p.m. in the bankruptcy cases of bankruptcy cases of The Parent
Company, eToys Direct, LLC, and their debtor-affiliates. The
meeting will be held at J. Caleb Boggs Federal Building 844 King
Street, Room 2112, in Wilmington, Delaware.
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtor's cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
Headquartered in Denver, Colorado The Parent Company --
http://www.etoys.com-- sells toys and children's products through
its Web sites. Debtor-affiliate Parent Company is publicly traded
on the NASDAQ under the ticker symbol KIDS. The Debtors lease two
distribution centers in Blairs, Virginia, which holds inventory
and ship products, and Ringgold, Virginia, which is used primarily
for ship-alone items off-site storage. The company and eight of
its affiliates, including EToys Direct 1, LLC, filed for Chapter
11 protection on December 28, 2008 (Bankr. D. Del. Lead Case No.
08-13412). Laura Davis Jones,
Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl & Jones
LLP, represent the Debtors. The Debtors hired Clear Thinking
Group LLC as financial advisor; Omni Management Group LLC as
claims agent; and Gibson & Rechan LLC as restructuring advisors.
Parent Co., as of August 2, 2008, had $95,582,085 in total assets,
and $30,073,056 in total liabilities. The company also had
$82,220,324 in accumulated deficit. The company reported a
$7,583,774 net loss for the three months ended, and $13,964,356
net loss for the six months ended August 2, 2008.
In papers filed with the bankruptcy court, the Debtors disclosed
$20,633,447 in total assets, and $35,722,280 in total liabilities
as of December 22, 2008.
PLASTECH ENGINEERED: Declares Fifth Amended Plan Effective
----------------------------------------------------------
Plastech Engineered Products Inc.'s confirmed Fifth Amended Joint
Plan of Liquidation became effective in accordance with its terms
on December 31, 2008, Gregg M. Galardi, Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in Wilmington, Delaware, disclosed.
The U.S. Bankruptcy Court for the Eastern District of Michigan
(Detroit) ordered the dissolution of Plastech Engineered Products,
Inc., and debtor-affiliates LDM Technologies, Inc., Plastech
Frenchtown, Inc., Plastech Decorating Systems, Inc., Plastech
Exterior Systems, Inc., Plastech Romulus, Inc., MBS Polymet, Inc.,
LDM Holding Canada, Inc., and LDM Holding Mexico, Inc., effective
December 31.
The dissolution will not affect the validity of any pre-
dissolution liens or security interests, Judge Phillip J.
Shefferly said.
Prior to entry of the Dissolution Order, the Debtors sought and
obtained the concurrence of parties-in-interest to the
dissolution request.
All administrative claims arising after May 30, 2008, must be
delivered to and received by Donlin Recano & Company, Inc. no
later than 5:00 p.m., March 2, 2009:
(a) by mail to:
Donlin, Recano & Company, Inc.,
Agent for the United States Bankruptcy Court
Re: Plastech Engineered Products, Inc., et al.,
Claims Processing
P.O. Box 899, Madison Square Station
New York, NY 10010;
or
(b) by hand-delivery or overnight courier:
Donlin, Recano & Company, Inc.
Agent for the United States Bankruptcy Court
Re: Plastech Engineered Products, Inc., et al.,
Claims Processing
419 Park Avenue South, Suite 1206
New York, NY 10016
Administrative Claimants must also serve their claim on the
Debtors' Liquidating Trustee, the Debtors' counsel, Skadden,
Arps, Slate, Meagher & Flom LLP, and Allard & Fish, P.C., counsel
for the Liquidating Trustee; and Clark Hill PLC, counsel for the
Post-Effective Date Committee.
All final requests for payment of professional fee claims
pursuant to Sections 327, 328, 330, 331, 503(b), or 1103 of the
Bankruptcy Code must be filed with the Court no later than
February 16, 2009. Objections, if any, to the Final Fee
Applications must be filed and served on (i) the Debtors'
Liquidating Trustee, (ii) Skadden, Arps, Slate, Meagher & Flom
LLP, and Allard & Fish, P.C., (iii) Clark Hill PLC,(iv) the
requesting Professional; and (v) the Office of the U.S. Trustee
for the Eastern District of Michigan, so as to actually be
received no later than 20 days from the date on which each of the
Final Fee Application is served and filed.
Moreover, if the rejection of an executory contract or unexpired
lease pursuant to the Debtors' Liquidation Plan gives rise to a
claim, that Claim will be forever barred and will not be
enforceable against the applicable Debtor or its Estate, the
Liquidating Trust, or their successors or properties unless a
proof of claim is filed with Donlin Recano by January 31, 2009.
About Plastech Engineered
Based in Dearborn, Michigan, Plastech Engineered Products, Inc. --
http://www.plastecheng.com/-- is a full-service automotive
supplier of interior, exterior and underhood components. It
designs and manufactures blow-molded and injection-molded plastic
products primarily for the automotive industry. Plastech's
products include automotive interior trim, underhood components,
bumper and other exterior components, and cockpit modules.
Plastech's major customers are General Motors, Ford Motor Company,
and Toyota, as well as Johnson Controls, Inc.
Plastech is a privately held company and is the largest family-
owned company in the state of Michigan. The company is certified
as a Minority Business Enterprise by the state of Michigan.
Plastech maintains more than 35 manufacturing facilities in the
midwestern and southern United States. The company's products are
sold through an in-house sales force.
The company and eight of its affiliates filed for Chapter 11
protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08-
42417). Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher &
Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C.,
represent the Debtors in their restructuring efforts. The Debtors
chose Jones Day as their special corporate and litigation counsel.
Lazard Freres & Co. LLC serves as the Debtors' investment bankers,
while Conway, MacKenzie & Dunleavy provide financial advisory
services. The Debtors also employed Donlin, Recano & Company as
their claims and noticing agent. Joel D. Applebaum, Esq., at Clark
Hill PLC, represents the Official Committee of Unsecured
Creditors.
The Debtors filed their Plan of Liquidation on August 11, 2008.
As of Dec. 31, 2006, the company's books and records reflected
assets totaling $729,000,000 and total liabilities of
$695,000,000. (Plastech Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
PRB ENERGY: Court Approves Adequacy of Disclosure Statement
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado has
approved the adequacy of the Disclosure Statement submitted in
support of PRB Energy, Inc., and PRB Oil & Gas, Inc.'s Modified
Second Amended Joint Plan of Reorgnization, dated Dec. 3, 2008,
filed Dec. 8, 2008.
Any objection to the confirmation of the Plan shall be filed with
the Court on or before Jan. 9, 2009.
A hearing for consideration of confirmation of the Plan and any
objections to the confirmation of the Plan will be held on
Jan. 16, 2009, at 10:30 a.m.
PRB Energy Inc. said that pursuant to the Plan, all of the
company's outstanding common stock will be canceled, Reuters
reported Wednesday. In exchange for its claims against PRB, West
Coast Opportunity Fund LLC would be issued 90% of new PRM Energy
common stock, while certain unsecured creditors will be issued the
remaining 10%.
PRB Energy added that West Coast Opportunity Fund, LLC, has agreed
to provide the company $1.5 million in exit financing once the
Plan is confirmed.
About PRB Energy
Headquartered in Denver, PRB Energy, Inc. formerly PRB Gas
Transportation, Inc. -- http://www.prbenergy.com/-- operates as
independent energy companies engaged in the acquisition,
exploitation, development and production of natural gas and
oil. In addition, PRB Energy provides gas gathering, processing
and compression services for properties it operates and for third-
party producers. PRB Energy operates as two business segments
through two wholly-owned subsidiaries, PRB Oil and Gas, Inc., a
gas and oil exploitation and production company, and PRB
Gathering, Inc., a gathering and processing company, formed in
August 2006. The company conducts its business activities in
Wyoming, Colorado and Nebraska. The Debtor, PRB Oil & Gas, Inc.
and PRB Gathering, Inc. filed separate petitions for Chapter 11
relief on March 5, 2008 (Bankr. D. Colo. Lead Case No. 08-12658).
Faegre & Benson LLP; Donald D. Allen, Esq., Edward M. Hepenstall,
Esq., James T. Markus, Esq., Jennifer M. Salisbury, Esq., and John
F. Young, Esq., at Block, Markus & Williams LLC represent the
Debtors in their restructuring efforts. Daniel J. Garfield, Esq.
and Michael J. Pankow, Esq., at Brownstein Hyatt Farber Schreck,
P.C. represent the Official Committee of Unsecured Creditors as
counsel. The Debtor listed assets of between
$50 million and $100 million and liabilities of between
$10 million and $50 million.
PRECISION DRILLING: Moody's Affirms, Not Assigns, Ba1 Rating
------------------------------------------------------------
Rating actions for Precision Drilling Corporation's Senior Secured
Bank Credit Facility appeared incorrectly in the December 22, 2008
press release. The Senior Secured rating should have been
affirmed at Ba1 (not assigned at Ba2). Additionally, the
Corporate Family Rating was downgraded to Ba2 from Ba1 (not
assigned at Ba2).
Moody's Revised Release
Moody's Investors Service lowered both the Corporate Family Rating
and Probability of Default Rating of Precision Drilling
Corporation, a subsidiary of Precision Drilling Trust to Ba2 from
(P)Ba1. The senior secured debt rating is unchanged at Ba1 (LGD-
3, 37%). The senior unsecured debt rating was withdrawn. The
SGL-2 speculative grade liquidity rating, indicating good
liquidity, is unchanged. The rating outlook is negative.
The lowering of the CFR to Ba2 reflects the increases in debt and
interest expense associated with the ongoing negotiation of the
rated secured credit facilities and the unrated US$400 million
senior unsecured bridge loan, coupled with the depreciation of the
Canadian dollar. Since assigning the ratings on October 23, 2008,
the estimated initial revolver draw, net of cash, has increased to
about US$60 million from the anticipated closing cash amount of
approximately C$100 million. Factoring in the decline in the
Canadian dollar, total debt has increased by approximately
C$400 million. Additionally, annual interest expense has
increased considerably as a result of the higher interest rates
needed to syndicate the debt. This action also considers the
recent sharp reductions in North American E&P company capex
budgets, which are a reaction to both lower oil and gas prices and
a contraction of credit markets. Lower capital spending will
result in decreased demand for drilling services of companies like
Precision leading to reduced cash flow. The negative outlook
reflects that Precision will remain exposed to potentially higher
interest rates, fees and discount on all of the secured debt as
the syndication of the revolver and Term Loan A continues.
Precision's Ba2 CFR reflects its pro-forma size and scale,
reasonable pro-forma leverage and history of conservative fiscal
management, good operating margins, and the geographic diversity
of its pro-forma drilling rig fleet throughout North America. The
rating is tempered by the inherent volatility of contract
drilling, concentration in North American land drilling,
integration risks related to the acquisition of Grey Wolf, unit
holder distributions as a Canadian income trust, and internal
growth and acquisition strategies. The rating considers
Precision's and Grey Wolf's leading market positions in North
America, longstanding customer relationships and quality rig
fleet. Precision's completion business also adds an element of
greater stability to the business mix.
The ratings of Grey Wolf will remain under review for possible
upgrade pending the closing of its acquisition by Precision. The
rating on Grey Wolf's 3.75% senior unsecured convertible debt will
remain at B1 for the portion of the convertible debt that remains
outstanding after the acquisition closes. Grey Wolf's Ba3 CFR will
be withdrawn when the Precision acquisition closes.
Precision is expected to acquire Grey Wolf on a fully diluted
basis for aggregate consideration of approximately US$1.12 billion
in cash and approximately 42 million Precision trust units, funded
in part by the proposed issuance by Precision of a US$400 million
senior secured term loan A, $400 million senior secured term loan
B and by drawings under a US$400 million bridge facility. The
final composition of debt will not be determined until after the
closing of the acquisition when the amount of Grey Wolf
convertible debt holders exercising their change of control puts
are known.
Downgrades:
Issuer: Precision Drilling Corporation
-- Probability of Default Rating, Downgraded to Ba2 from (P)Ba1
-- Corporate Family Rating, Downgraded to Ba2 from (P)Ba1
Affirmed:
Issuer: Precision Drilling Corporation
-- Senior Secured Bank Credit Facility, Affirmed Ba1
Upgrades:
Issuer: Precision Drilling Corporation
-- Senior Secured Bank Credit Facility, Upgraded to LGD3, 37%
from LGD3, 38%
Outlook Actions:
Issuer: Precision Drilling Corporation
-- Outlook, Changed To Negative From Stable
Withdrawals:
Issuer: Precision Drilling Corporation
-- Senior Unsecured Regular Bond/Debenture, Withdrawn,
previously rated (P)Ba2, LGD5, 88%
Moody's last rating action on Precision was to assign a (P)Ba1 CFR
and (P)Ba1 senior secured ratings on October 22, 2008. A (P)Ba2
senior unsecured rating was also assigned at that time. Moody's
last rating action on Grey Wolf was to place its ratings under
review for possible upgrade on August 25, 2008 following its
announcement that it had agreed to be acquired by Precision. The
Grey Wolf ratings under review are the Ba3 CFR, the Ba3 PDR, and
the B1 (LGD 4, 61%) rating on the senior unsecured convertible
notes.
Precision Drilling Corporation is a subsidiary of Precision
Drilling Trust, a Calgary, Alberta-based income trust engaged in
the provision of energy services to the oil and gas industry in
North America.
Grey Wolf, Inc. is a Houston, Texas-based company engaged in the
provision of oil and gas.
QUALITY HOME: To Seek Approval of Disc. Statement Jan. 23
---------------------------------------------------------
David Gould, the appointed Chapter 11 trustee for Quality Home
Loans, and the Official Committee of Unsecured Creditors delivered
to the Hon. Geraldine Mund of the United States Bankruptcy Court
for the Central District of California a joint disclosure
statement explaining a joint Chapter 11 plan dated Dec. 24, 2008,
for the Debtor.
The Trustee and Committee will present the plan on Jan. 23, 2009,
at 9:00 a.m., at 21041 Burbank Boulevard in Courtroom 303 in
Woodland Hills, California.
Overview of the Plan
The plan contemplates the liquidation of the Debtor's assets to
distribute cash and proceeds to creditors and interest holders.
The plan will be funded by cash on hand as of the effective date
and future cash received by the Debtor.
The settlement agreement dated Nov. 11, 2008, by and among the
Debtor; the trustee; QHL Holdings Fund Ten LLC; Golden State TD
Investments LLC; California TD Investments LLC; Pacificor LLC;
Alim Kassam, Lathaam & Watkins LLP; Klien estate; and the class
plaintiffs in a certain foreman adversary. The agreement resolved
certain pending disputes between the parties. Furthermore, the
Debtors stand to receive in excess of $2,975,570 in cash in
addition to amount already received under the agreement.
The plan classifies interests against and liens in the Debtor in
eight groups. The classification of treatments of interests and
claims are:
Treatment of Claims
Class Type of Claims Treatment
----- -------------- ---------
NA administrative
NA priority tax
1 secured and priority
2 Pacificor impaired
3 Funds impaired
4 Cal TD impaired
5 Plaintiffs impaired
6 General Unsecured impaired
7 Subordinated
8 Equity Holders
On the plan's effective date, allowed administrative and priority
tax claims will be paid in full. The proponents estimate that
administrative claims payable will total about $2,800,000.
There are no secured claims payable under the plan.
On the effective date of the settlement agreement, Pacificor
will be paid at least $17,484,866 as of Oct. 31, 2008, from
the Debtor's cash under the Plan. Thereafter, for the first
$10,000,000 in NIM Proceeds received after June 30, 2008,
Pacificor will be paid 57.5%, or $5,750,000. For any NIM Proceeds
received in excess of $10,000,000, Pacificor will be paid 33.33%
of such amount until such time as Pacificor may receive
$42,000,000.
The Funds will not receive distributions under the Plan,
except for an initial distribution of $1,316,675 as of Oct. 31,
2008 from cash on hand held by the Trustee.
Cal TD will not receive distribution from the Debtor on account of
its claim.
The Plaintiffs will not receive distributions under the Plan. The
sole source of payment and satisfaction of and distributions on
account of any claims asserted by the Plaintiffs against the
proponents and the Estates, will be from any litigation recoveries
obtained on account of the pending class action complaint, and the
derivative claims, among other things.
Class 6 General unsecured claims will receive a pro rata share of
remaining cash on hand at time that estate representative
determines that postconfirmation estate is fully administered.
The estate representative may make an interim distribution in its
absolute discretion. A recovery analysis showing the
range of potential distributions based on variables such as the
gross amount of allowed unsecured claims ranging from $6.6 million
to $7.1 million.
Class 7 holders will receive payment after full payment, plus
interest at 3% per annum from the plan's effective date, to
all Class 6 creditors under the Plan.
Equity holders will not receive distributions under the plan.
A full-text copy of the joint disclosure statement is available
for free at http://ResearchArchives.com/t/s?3757
A full-text copy of the joint Chapter 11 plan is available for
free at http://ResearchArchives.com/t/s?3758
Headquartered in Agoura Hills, California, Quality Home Loans --
http://www.qualityhomeloans.com -- is an equity lender. The
company and three of its affiliates filed for Chapter 11
protection on August 2007 (Bankr. C.D. Calif. Lead Case No.
07-13006). Mike D. Neue, Esq., at Irell & Manella, L.L.P.,
represents the Debtors in their restructuring efforts. Alan J
Friedman, Esq., at Irell & Manella, L.L.P., represents David
Gould, the Chapter 11 Trustee. The U.S. Trustee for Region 16
appointed creditors to serve on an Official Committee of Unsecured
Creditors. Winston & Strawn LLP represents the Committee. When
the Debtors filed for protection from their creditors, they listed
asset between $1 million and $100 million, and debts of more than
$100 million.
RECYCLED PAPER: Can Use $10MM Credit Suisse Facility on Interim
---------------------------------------------------------------
The Hon. Kevin J. Gross of the United States Bankruptcy Court for
the District of Delaware authorized Recycled Paper Greetings Inc.
and its debtor-affiliates to obtain, on an interim basis, up to
$10 million in postpetition financing under the senior secured
superpriority debtor in possession credit agreement dated
Dec. 30, 2008, with Credit Suisse Cayman Islands Branch, as
administrative agent for American Greetings Corporation together
with other financial institutions.
Judge Gross also authorized the Debtors to access cash collateral
securing repayment of secured loan to the lenders.
Proceeds of the facility will be used for working capital,
general corporate purposes and to fund the Debtors' Chapter 11
cases. Under the credit agreement, the DIP financing will incur
interest:
a) non-Eurodollar borrowings at a rate per annum equal to the
greater of:
-- the prime rate;
-- the Federal Funds Effective Rate plus 0.5%;
-- the LIBO Rate plus statutory reserves plus 1%; and
-- 4% plus 5% per annum;
b) Eurodollar borrowings at a rate per annum equal to, but
less than 3%, the LIBO rate plus statutory reserves plus 6%
per annum.
The facility will mature by May 31, 2009. The credit agreement
contains customary and appropriate events of default including,
among other things:
-- dismissal or conversion to Chapter 7 proceeding;
-- appointment of a trustee or an examiner;
-- failure to obtain final DIP order within 21 days after the
entry of the interim order;
-- failure to obtain court approval of the disclosure
statement explaining a plan by Feb. 2, 2009, and
confirmation of that plan by Feb. 23, 2009; and
-- cross-default to other postpetition material indebtedness.
The DIP facility is subject to a $300,000 carve-out to pay certain
fees or expenses incurred by professionals retained by the
Debtors.
As part of the transaction, the Debtors agreed to pay (i) $200,000
to the DIP lenders; (ii) $325,000 to the DIP agent; and (iii)
unused line fee payable to the DIP lenders on the last business
day of each month equal to 3% per annum of the average daily
unused amount of the revolving credit commitment of the lender
during the preceding month.
To secure their DIP obligations, the lenders will receive a
replacement and additional security interest in and liens upon the
collateral including avoidance actions, superpriority claims, and
immediate payment of all accrued and unpaid fees, costs and
expenses owed under the agreement.
A hearing is set for Jan. 23, 2009, at 2:00 p.m., to consider
final approval of the Debtors' request.
Prepetition Indebtedness
The Debtors entered on Dec. 5, 2009, into a first lien credit
agreement with Credit Suisse, as administrative and collateral
agent; and the second lien credit agreement with Wells Fargo Bank
National Association and certain lenders. The credit agreements
were amended and modified several times between Dec. 5, 2005, to
March 31, 2008.
A. First Lien Credit Agreement
The first lien credit agreement provides for (i) a $20 million
revolving credit facility and (ii) $120 million term loan
facility. Obligations under the agreements are guaranteed by RPG
Holdings, Recycled Greetings Canada Inc. and Barnyard Industries
Inc. As of the Debtors' bankruptcy filing, there is about
$134.5 million outstanding under the agreement consist of:
-- $15.5 million revolving credit loan;
-- $109.3 million tranche B term loan;
-- all accrued and unpaid interest;
-- obligations under outstanding letters of credit issued
under the first lien credit agreement in the aggregate
amount of $490,020; and
-- termination obligations under certain outstanding interest
rate swaps.
B. Second Lien Credit Agreement
The second line credit agreement provides up to $77 million term
loan facility, which is also guaranteed by RPG Holdings, Recycled
Paper Greetings Canada Inc., and Barnyard Industries Inc. As of
the Debtors' bankruptcy filing, there is approximately $90 million
outstanding under agreement consist of:
-- $81.8 million term loan; and
-- all accrued and unpaid interest.
In connection with the prepetition credit agreements, the Debtors
granted liens and executed security agreements in favor of the
prepetition lenders in substantially all of the Debtors' assets.
A full-text copy of the senior secured superpriority debtor in
possession credit agreement dated Dec. 30, 2008, is available for
free at http://ResearchArchives.com/t/s?376a
About Recycled Paper
Headquartered in Chicago, Illinois, Recycled Paper Greetings Inc.
designs, manufactures, and distributes greetings cards and social
expression products throughout the U.S. and Canada. RPG is the
third largest greeting card company in North America. The company
and three of its affiliates filed for Chapter 11 protection on
Jan. 2, 2009 (Bankr. D. Del. Lead Case No. 09-10002). Michael F.
Walsh, Esq. and Rachel Ehrlich Albanese, Esq., at Weil, Gotshal &
Manges LLP, represent as the Debtors' bankruptcy counsel. Mark D.
Collins, Esq., Chun I. Jang, Esq., and Lee E. Kaufman, Esq., at
Richards, Layton & Finger, P.A., represents as the Debtors' local
counsel. The Debtor proposed Rothschild Inc. as financial and
restructuring advisor and Kurtzman Carson Consultants LLC as
claims and noticing agent. When the Debtors filed for protection
from their creditors, they listed assets and debts between
$100 million to $500 million each.
RECYCLED PAPER: Proposes Feb. 16 Plan Confirmation Hearing
----------------------------------------------------------
Recycled Greetings Inc. filed with U.S. Bankruptcy Court for the
District of Delaware a plan of reorganization and disclosure
statement together with its Chapter 11 petition on Jan. 2. The
Plan is premised on the acquisition of the company's assets by
American Greetings Corp.
Recycled Paper proposed a Feb. 16 combined hearing to consider
approval of the disclosure statement and confirmation of the Plan.
According to Bloomberg's Bill Rochelle, before Recycled Paper's
bankruptcy filing, the reorganization plan was unanimously-
accepted by the holders of the first- and second-lien debt.
Unsecured creditors are to be paid in full, aren't impaired by the
plan, and didn't vote, the report added.
The terms of the Plan are:
-- Holders of first lien debt will receive $12.4 million
cash and notes for $34.4 million;
-- Second lien lenders will receive notes for $13.15 million.
American Greetings will pay as much as $18.4 million cash and
$54.7 million in 7.375% notes. The acquisition includes a
$44.2 million investment American Greetings made in July.
About Recycled Paper
Headquartered in Chicago, Illinois, Recycled Paper Greetings Inc.
designs, manufactures, and distributes greetings cards and social
expression products throughout the U.S. and Canada. RPG is the
third largest greeting card company in North America behind
Hallmark Cards and American Greetings. The company is controlled
by private equity firm, Monitor Clipper Partners.
The company and three of its affiliates filed for Chapter 11
protection on Jan. 2, 2009 (Bankr. D. Del. Lead Case No. 09-
10002). Michael F. Walsh, Esq. and Rachel Ehrlich Albanese, Esq.,
at Weil, Gotshal & Manges LLP, represent as the Debtors'
bankruptcy counsel. Mark D. Collins, Esq., Chun I. Jang, Esq.,
and Lee E. Kaufman, Esq., at Richards, Layton & Finger, P.A.,
represents as the Debtors' local counsel. The Debtor proposed
Rothschild Inc. as financial and restructuring advisor and
Kurtzman Carson Consultants LLC as claims and noticing agent.
When the Debtors filed for protection from their creditors, they
listed assets and debts between $100 million to $500 million each.
REDROLLER HOLDINGS: Wants Case Converted to Chapter 7 Proceeding
----------------------------------------------------------------
Bloomberg News reports that RedRoller Holdings asked the United
States Bankruptcy Court to convert its Chapter 11 restructuring
case to a Chapter 7 liquidation proceeding.
Bloomberg says William Van Wyck, Ronald Rose and Robert J. Crowell
step down as directors of the company.
Headquartered in Stamford, Connecticut, RedRoller Holdings Inc.
filed for protection on November 13, 2008 (Bankr. D. Conn. Case
No. 08-51101). James Berman, Esq., at Zeisler and Zeisler,
represents the Debtor. When the Debtor filed for protection from
its creditors, it listed assets between $1 million and
$10 million, and debts between $500,000 and $1 million.
ROBERT MCLEAN: Will Receive $750,000 From Country Music
-------------------------------------------------------
The Associated Press reports that Robert Waldschmidt, the trustee
for Robert McLean's bankruptcy estate, has reached a settlement
with the Country Music Foundation, which runs the Country Music
Hall of Fame and Museum, after more than a year of negotiations.
Mr. Waldschmidt, according to The AP, wanted to recover about
$1.54 million from Country Music Hall, but museum director Kyle
Young said it didn't have the money. The instruments at the
museum, like all of its collection, are held in trust for the
benefit of the public, the report states. The settlement was
filed in the U.S. Bankruptcy Court for the Middle District of
Tennessee.
The AP states that the Country Music Hall will pay $750,000 to
Mr. McLean's bankruptcy estate to keep historic instruments from
Bill Monroe, Johnny Cash, and Mother Maybelle Carter. According
to the report, Mr. McLean donated two Johnny Cash guitars to the
museum, each valued last year at $125,000 in 2008, and pledged
money that let the museum enter confidential purchase agreements
for these other instruments:
-- Monroe's 1923 Gibson mandolin, once priced at
$1.1 million; and
-- Carter's 1928 Gibson guitar, once priced at $575,000.
The money from Country Music Hall will be used to help pay back
Mr. McLean's creditors, The AP says.
According to The AP, the settlement is subject to court approval.
Under the settlement, Country Music Hall will write off the
$870,850 unpaid balance of Mr. McClean's pledges, The AP reports.
Robert McLean is an investor from Murfreesboro who was accused of
swindling victims of more than $67 million in a Ponzi scheme. He
committed suicide after being accused of defrauding investors of
millions of dollars. Fred C. Goad and retired Murfreesboro
neurosurgeon Warren F. McPherson filed an involuntary Chapter 7
petition in July 2007 against Mr. McLean, claiming that they were
owed a combined $11.4 million.
SECO AMERICAN: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Seco American Corporation
P.O. Box 29
Perth Amboy, NJ 08862
Bankruptcy Case No.: 08-35823
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
American Wrecking Corporation 08-35824
of New Jersey
Phoenix Recycling Corporation 08-35827
Phoenix Remediation Corporation 08-35830
Type of Business: Repair Shops and Related Services
Chapter 11 Petition Date: December 30, 2008
Court: United States Bankruptcy Court
District of New Jersey (Trenton)
Judge: Kathryn C. Ferguson
Debtor's Counsel: David L. Bruck, Esq.
Greenbaum, Rowe, Smith, et al.
P.O. Box 5600
Woodbridge, NJ 07095
Tel.: (732) 549-5600
Fax : (732) 549-1881
Email: bankruptcy@greenbaumlaw.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/njb08-35823.pdf
The petition was signed by William D. Spector, President of the
company.
SECURUS TECHNOLOGIES: Moody's Downgrades Corp. Ratings to 'Caa2'
----------------------------------------------------------------
Moody's Investors Service downgraded Securus Technologies Inc.'s
Corporate Family Rating, its Probability of Default Rating, and
the rating for its Second Priority Senior Secured notes, all to
Caa2 from Caa1. The outlook for all ratings remains negative.
The rating actions reflect Moody's views that although Securus has
progressed in its turnaround efforts over the past year to
stabilize its operations and shore up its liquidity, the company's
current run-rate revenues and cash flows may not be sufficient to
support its current capital structure, as the accretion on the 17%
PIK subordinated notes has been growing faster than the company's
cash flows. In addition, Moody's believes that while the
potential improvements in the company's operations may begin to
materialize towards the end of 2009, tightening covenants in the
first lien senior secured facility increase the possibility of a
covenant breach within the next 12-15 months.
Downgrades:
Issuer: Securus Technologies, Inc.
-- Probability of Default Rating, Downgraded to Caa2 from Caa1
-- Corporate Family Rating, Downgraded to Caa2 from Caa1
-- Senior Secured Regular Bond/Debenture, Downgraded to Caa2
from Caa1
Upgrades:
Issuer: Securus Technologies, Inc.
-- Senior Secured Regular Bond/Debenture, Upgraded to LGD3, 43%
from LGD3, 47%
The Caa2 corporate family rating reflects Securus' high leverage
resulting from a slate of acquisitions since 2004, weak free cash
flow generation relative to the CLECs that Moody's rates, and the
uncertain time frame to implement its turnaround plan prior to a
potential covenant violation and/or liquidity shortfall. Although
Moody's recognizes that the market for inmate telecommunications
providers has been consolidating over the past couple of years, it
still remains a tight field with competitive negotiations during
contract renewals, leading to ongoing margin pressure. Securus'
offender management software segment provides an opportunity for
revenue and cash flow growth, although in Moody's opinion the
positive impact from this business is unlikely to come in the near
term.
Moody's believes that Securus' high debt levels, rising with the
accreting subordinated PIK notes, may not be sustainable over the
long term. Moreover, Moody's views a payment default over the
next two years, or some form of distressed exchange of at least a
portion of Securus' debt as increasingly more likely.
Moody's also maintained Securus' SGL-4 liquidity rating,
constrained mainly by ongoing risk of a technical default for
prospective failure to comply with financial maintenance
covenants. Moody's recognizes, however, the near-term improvement
in the company's liquidity profile, aided by the signing of a new
credit facility in September 2008, which in Moody's opinion
provides the company with some added operating flexibility over
the ensuing 12 months.
Moody's last rating action was on October 1, 2007, when Securus'
Corporate Family and Second Priority Senior Secured ratings were
lowered to Caa1, from B3 and B2, respectively, following the
company's announcement of its expected substantial shortfall of
third quarter earnings relative to previous guidance.
Based in Dallas, Texas, Securus Technologies, Inc. is one of the
largest providers of inmate telecommunication services to
correctional facilities in the United States and Canada.
SEMGROUP LP: Red Apple to Submit Bankruptcy Plan This Month
-----------------------------------------------------------
John A. Catsimatidis, chairman of Red Apple Group, said he intends
to develop a plan of reorganization for bankrupt petroleum
provider, SemGroup L.P. and its affiliates. Reuters reported on
December 17, 2008, that Mr. Catsimatidis will have the
reorganization plan for SemGroup ready by January 2009.
According to various reports, Mr. Catsimatidis obtained five of
the nine seats on SemGroup G.P., L.L.C.'s Management Committee,
equivalent of SemGroup L.P.'s board of directors.
"I strongly believe that reorganization will deliver far more
value to SemGroup's creditors than liquidation," Mr. Catsimatidis
said in a press release. "SemGroup has a tremendous portfolio of
assets that can be revitalized with a renewed commitment to the
company's core businesses. The problem with liquidation is there
will likely be nothing left once the assets have been sold - if
they can be sold at all in this environment."
Mr. Catsimatidis, according to the Tulsa World, met with SemGroup
employees, managers and reporters on December 23, 2008, and
announced that he intends to preserve majority of the SemGroup
jobs, with a possibility of even hiring more. He also announced
that he plans to maintain SemGroup's headquarters in Tulsa,
Oklahoma.
Mr. Catsimatidis, owner of Red Apple supermarkets, acquired
gasoline refinery United Refining Co., in 1986 and rescued it
from bankruptcy in 1988. The Tulsa World said Mr. Catsimatidis
might even merge United Refining with SemGroup to strengthen
SemGroup's chances of survival.
The Tulsa World said Mr. Catsimatidis has the support of Ritchie
Capital, which controls one seat of the Management Committee, but
has not gained the support of Carlyle/Riverstone, which controls
three seats.
"I am very pleased with the spirit of cooperation demonstrated by
everyone I have met so far," Mr. Catsimatidis said in a press
release. "We have been reaching out to obtain input from
SemGroup's management team and certain of its creditors."
"Although I have not yet had any discussions with Bank of
America, in its capacity as Administrative Agent for the Senior
Secured Lenders, it has been stated to me that the bank will
consider with its lender group any proposal that I make,"
Mr. Catsimatidis added.
About SemGroup
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-
11525). These represent the Debtors' restructuring efforts: John
H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq.
at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P.
Kessler, Esq. and Sherri L. Toub, Esq. at Weil, Gotshal & Manges
LLP; and Martin A. Sosland, Esq. and Sylvia A. Mayer, Esq. at Weil
Gotshal & Manges LLP. Kurtzman Carson Consultants L.L.C. is the
Debtors' claims agent. The Debtors' financial advisors are The
Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
Nov. 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
SEMGROUP LP: Will Consider Restructuring Bid from Catsimatidis
--------------------------------------------------------------
SemGroup, L.P. says its management committee and its officers are
committed to maximizing recoveries for its creditors and equity
holders, as required by the Bankruptcy Code.
To ensure a successful reorganization, the company will consider
all restructuring proposals, including any plan that may be
forthcoming from a group led by John Catsimatidis. The company
will also continue to market its assets and evaluate offers
received in light of the company's stated objective of maximizing
value for its creditors and equity holders.
The company and its advisors will continue to conduct a process
that gives transparent, equal and fair consideration to all
potential alternatives for the company's businesses and assets.
If and when Mr. Catsimatidis makes a formal restructuring
proposal, it will receive the same consideration as any other
proposal.
The company appreciates and encourages interested parties to
participate in this process. To date, the company has not
received a formal restructuring proposal from Mr. Catsimatidis.
The current economic environment makes the plight of the company's
employees of special concern to the members of the Management
Committee and its officers. Wherever possible and consistent with
obligations under the Bankruptcy Code, any restructuring or sale
of the company's businesses and assets will also seek to protect
the interests of the company's employees.
Today's Troubled Company Reporter says John A. Catsimatidis,
chairman of Red Apple Group, intends to develop a plan of
reorganization for SemGroup L.P. and its affiliates. Reuters
reported on December 17, 2008, that Mr. Catsimatidis will have the
reorganization plan for SemGroup ready by January 2009. According
to various reports, Mr. Catsimatidis obtained five of the nine
seats on SemGroup G.P., L.L.C.'s Management Committee, equivalent
of SemGroup L.P.'s board of directors. Mr. Catsimatidis, according
to the Tulsa World, met with SemGroup employees, managers and
reporters on December 23, 2008, and announced that he intends to
preserve majority of the SemGroup jobs, with a possibility of even
hiring more.
The Tulsa World said Mr. Catsimatidis has the support of Ritchie
Capital, which controls one seat of the Management Committee, but
has not gained the support of Carlyle/Riverstone, which controls
three seats.
About SemGroup
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-
11525). These represent the Debtors' restructuring efforts: John
H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq.
at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P.
Kessler, Esq. and Sherri L. Toub, Esq. at Weil, Gotshal & Manges
LLP; and Martin A. Sosland, Esq. and Sylvia A. Mayer, Esq. at Weil
Gotshal & Manges LLP. Kurtzman Carson Consultants L.L.C. is the
Debtors' claims agent. The Debtors' financial advisors are The
Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
Nov. 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
SEQUOIA HILLS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Sequoia Hills Ranch LLC
8364 Westlawn Ave.
Los Angeles, CA 90045
Tel.: (310) 417-5145
Bankruptcy Case No.: 08-32845
Type of Business: General Animal Farm
Chapter 11 Petition Date: December 30, 2008
Court: United States Bankruptcy Court
Central District Of California (Los Angeles)
Judge: Alan M. Ahart
Debtor's Counsel: Michael Jay Berger, Esq.
9454 Wilshire Blvd., 6th Flr.
Beverly Hills, CA 90212-2929
Tel.: (310) 271-6223
Fax : (310) 271-9805
Email: mikeberger@aol.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/cacb08-32845.pdf
The petition was signed by Matthew Kot, Managing Member of the
company.
SILVER STATE: Files Chapter 7 Petition in Nevada
------------------------------------------------
Bankruptcy Data reports that Silver State Bancorp filed for
Chapter 7 protection with the U.S. Bankruptcy Court in the
District of Nevada, case number 09-10069. The company is
represented by Brigid M. Higgins of Gordon & Silver, the report
says.
On Sept. 5, 2008, Silver State Bank, the wholly-owned subsidiary
of Silver State Bancorp, was closed by the State of Nevada,
Department of Business and Industry, Financial Institutions
Division and the Federal Deposit Insurance Corporation was
appointed as receiver of the Bank.
As reported in the Troubled Company Reporter on Sept. 9, 2008, to
protect the depositors, the FDIC entered into a Purchase and
Assumption Agreement with Nevada State Bank, Las Vegas, Nevada, to
assume the Insured Deposits of Silver State Bank.
The appointment of a receiver for Silver State Bank has resulted
in an event of default under the terms of the Company's
outstanding junior subordinated debt securities and related trust
preferred securities of:
-- Silver State Capital Trust V. As a result, the entire
outstanding balance and all accrued, but unpaid, interest
relating to the trust preferred securities of Silver State
Capital Trust V became immediately due and payable. As of
Sept. 5, 2008, the outstanding balance of trust preferred
securities of Silver State Capital Trust V was $7.5 million,
plus accrued but unpaid distributions of $81,557.06 as of
that date; and
-- Silver State Capital Trust IV, which allows the holders of
the trust preferred securities to cause an acceleration of
the outstanding balance plus accrued but unpaid interest. As
of Sept. 5, 2008, the outstanding balance of trust preferred
securities of Silver State Capital Trust IV was $20 million,
plus accrued but unpaid distributions of $154,022.16 as of
that date.
The acceleration of the junior subordinated debt securities
relating to the trust preferred securities of Silver State Capital
Trust V has also resulted in an event of default under the terms
of the company's outstanding junior subordinated debt securities
and related trust preferred securities of Silver State Capital
Trust II, Silver State Capital Trust III and Silver State Capital
Trust VI, which allows the respective holders of these trust
preferred securities to cause an acceleration of the outstanding
balances plus accrued but unpaid interest. As of Sept. 5, 2008,
the aggregate outstanding balance of the trust preferred
securities of these Trusts was $40 million, plus accrued but
unpaid distributions of $339,825.43 as of that date.
On Aug. 26, 2008, Silver State Bancorp appointed Phillip C.
Peckman to its company's audit committee after Andrew K. McCain
resigned. The company is now in full compliance with the Nasdaq
audit committee composition requirements under the Nasdaq Stock
Market Marketplace Rule 4350.
Silver State said on its Web site that:
* All insured non-brokered deposit accounts at the Nevada
branches have been transferred to Nevada State Bank, Las
Vegas, NV.
* All insured non-brokered deposit accounts at the Arizona
branches have been transferred to National Bank of Arizona.
The company's board related that the company's primary assets
-- excluding investment in Silver State Bank and its investments
in Silver State Capital Trusts II, III, IV, V and VI, which
investments are expected to be written off completely -- consist
primarily of cash and cash equivalents of $490,000, as of Sept.
16, 2008. The company's liabilities comprised primarily of junior
subordinated debt of $69.6 million, accrued and unpaid interest of
$575,400 and known accounts payable of as much as $214,000, the
board continued.
The company's consolidated balance sheets at June 30, 2008, showed
total assets of $1,961,417,000 and total liabilities of
$1,892,633,000 resulting in a $68,784,000 stockholders' equity.
The company reported a $73,194,000 net loss on total interest
income of $29,053,000 for the three months ended June 30, 2008,
compared to a $3,641,000 net loss on total interest income of
$34,343,000 for the same period a year ago.
Headquartered in Henderson, Nevada, Silver State Bancorp (NASDAQ:
SSBX) -- http://www.silverstatebank.com/-- through its wholly-
owned subsidiary, Silver State Bank, currently operates 13 full
service branches in southern Nevada and four full service branches
in the Phoenix/Scottsdale market area. Silver State Bank also
operates loan production offices located in Nevada, California,
Washington, Oregon, Utah, Colorado and Florida.
SKINNY NUTRITIONAL: Posts $1.4MM Net Loss in Qtr. Ended Sept. 30
----------------------------------------------------------------
Skinny Nutritional Corp.'s net losses were $1,477,110 for the
three months ended September 30, 2008 as compared to a loss of
$934,703 for the three months ended September 30, 2007. The net
loss includes general and administrative expenses related to the
costs of start-up operations and a significant amount of marketing
expenses related to establishing the company's brand in the
market. In addition, the net loss includes a significant amount
of public company expenses incurred to become a reporting company
and transition the company from the pink sheets to the OTC
Bulletin Board.
In a regulatory filing dated November 14, 2008, Donald J.
McDonald, the company's chief executive officer and chief
financial officer at that time, disclosed that the company has
incurred losses since its inception and has not yet been
successful in establishing profitable operations. "These factors
raise substantial doubt about the ability of the company to
continue as a going concern. In this regard, management is
proposing to raise any necessary additional funds through sales of
its common stock or through loans from shareholders. There is no
assurance that the company will be successful in raising
additional capital or achieving profitable operations."
"To date, we have needed to rely upon selling equity and debt
securities in private placements to generate cash to implement our
plan of operations. We have an immediate need for cash to fund our
working capital requirements and business model objectives and we
intend to either undertake private placements of our securities,
either as a self-offering or with the assistance of registered
broker-dealers, or negotiate a private sale of our securities to
one or more institutional investors. We are currently seeking to
raise up to $2,000,000 in additional capital through a common
stock financing in the fourth quarter of 2008. However, we
currently have no firm agreements with any third-parties for such
transactions and no assurances can be given that we will be
successful in raising sufficient capital from any proposed
financings."
As of September 30, 2008, the company's balance sheet showed total
assets of $1,906,548, total liabilities of $1,521,190, and total
stockholders' equity of $385,358. Accumulated deficit reached
$15,606,712.
A full-text copy of the company's quarterly report is available
for free at: http://researcharchives.com/t/s?3767
New CEO
On December 1, 2008, Skinny Nutritional entered into an employment
relationship with Ronald D. Wilson, who will serve as the
President and Chief Executive Officer of the company effective
immediately. Contemporaneously with Mr. Wilson's appointment as
the President and Chief Executive Officer of the company, the
Board elected Mr. Wilson to serve on the company's Board of
Directors for a period of one year or until his successor is
elected and qualified. Mr. Wilson's appointment was made following
the resignation of Mr. Donald McDonald as the company's President
and Chief Executive Officer. Mr. McDonald will continue to serve
on the company's Board of Directors and as the company's Chief
Financial Officer.
Pursuant to an offer letter Mr. Wilson entered into with the
company, the company will pay and provide to Mr. Wilson:
(a) base salary of $150,000 per annum;
(b) grant of 2,000,000 shares of restricted common stock;
(c) grant of warrants to purchase 2,000,000 shares of common
stock which will be immediately exercisable on the date of
grant for a period of five years at an exercise price
equal to the closing price of the company's common stock
on the date of grant;
(d) subject to the approval of the company's stockholders of a
new equity compensation plan, options to purchase
2,000,000 shares of common stock, exercisable for a period
of five years and which options will vest in full on the
first anniversary of the grant date and have an exercise
price equal to the fair market value of the company's
common stock, as determined in accordance with the new
equity compensation plan, on the date that such plan is
approved by the company's stockholders;
(e) a car allowance of $700 per month;
(f) reimbursement of health benefits or cash equivalent in an
amount not to exceed $1,000 per month; and
(g) $2,000 per month for a rental lease for housing for 1 year
period.
"I'm excited about this opportunity to take Skinny Water to the
next level," says Mr. Wilson. "In less than six months Skinny
Water has been embraced by millions of customers who are searching
for great tasting flavored water that provides functional
benefits, and most importantly zero calories and zero sugar. As
we go forward, we'll expand our flavor offerings, and look to use
the Skinny trademark in other beverage categories, such as ready-
to-drink teas and coffees."
Mr. Wilson entered the soft drink industry in 1969 as route
salesman for Pepsi-Cola, and worked his way up to branch manager.
He joined the Coca-Cola family in 1977 as a financial analyst with
Coca-Cola Bottling Company of New York. Over the years, Mr.
Wilson held various positions within Coca-Cola Bottling Company,
rising from division manager to Vice President/General Manager of
the New Jersey division. In 1985, he became the President and
Chief Operating Officer of The Philadelphia Coca-Cola Bottling
Company. Mr. Wilson led the company to become the fourth largest
Coca-Cola bottler in the country. While at the helm, Mr. Wilson
was also President of The Coca-Cola Bottlers' Association and a
Vice President of The Dr. Pepper Bottlers' Association. He is
currently the Vice Chair for the Board of Overseers at his alma
mater, Rutgers University, and is an advisor to Rutgers School of
Business in Camden, N.J. In October 2008, Mr. Wilson was inducted
into the Beverage World Soft Drink Hall of Fame.
"The appointment of Ron Wilson as the President and CEO represents
the transition of the company from the start-up phase to a growth
and operational phase," says Don McDonald, former President and
CEO of Skinny Nutritional Corp. "Ron's experience and leadership
will be invaluable, and we know he'll take the company to new
levels of profitability."
Mr. McDonald will now serve as Chief Financial Officer of Skinny
Nutritional Corp., and will focus on investor relations to
introduce the company to a variety of institutional bankers.
"Ron Wilson's tenacity for detail and years of beverage experience
brings the financial disciplines and leadership to build the
Skinny brand into a beverage powerhouse," says Pat Croce, member
of the Board of Advisors. "As an emerging company, it's a real
triumph to get a veteran executive of this magnitude to join our
company."
Private Offering
As of December 22, 2008, Skinny Nutritional consummated closings
in its private offering pursuant to which it is raising capital in
an aggregate gross amount of up to $1,875,000, inclusive of an
oversubscription right of $375,000. As of that date, the company
has closed on subscriptions in the aggregate amount of $994,465
and has issued investors a total of 16,574,417 shares of common
stock.
About Skinny Nutritional Corp.
Headquartered in Bala Cynwyd, Pa., Skinny Nutritional Corp. is the
exclusive worldwide distributor of Skinny Water(R), a zero-
calorie, zero-sugar, zero-sodium and zero-preservative multi-
functional water that helps aid in weight loss.
SLM HOLDINGS: Sept. 30 Balance Sheet Upside Down by $1,552,913
--------------------------------------------------------------
SLM Holdings, Inc., and its wholly owned subsidiary, Sales Lead
Management, Inc., generated revenue of $83,644 for the three
months ended September 30, 2008, as compared to $42,912 for the
three months ended September 30, 2007. "The increase in revenues
from that three month period in 2008 to 2007 was primarily due to
increase in marketing, which has generated more revenue," Jason
Bishara, principal executive officer and principal financial
officer, disclosed in a regulatory filing dated November 14, 2008.
Mr. Bishara added that for the three months ended September 30,
2008, the company's total operating expenses were $318,304, as
compared to total operating expenses of $1,489,919 for the three
months ended September 30, 2007. "The decrease in total operating
expenses was due primarily to the decrease in stock-based
compensation of approximately $1,100,000, as well as a decrease in
consulting fees of approximately $75,000."
The company posted a net loss of $274,614 for the three months
ended September 30, 2008, compared with a net loss of $1,619,428
for the same period a year earlier.
As of September 30, 2008, the company's balance sheet showed total
assets of $1,555,292 and total liabilities of $3,108,205,
resulting in total stockholders' deficit $1,552,913. Accumulated
deficit reached $17,195,125.
The company had cash of $1,131 and accounts receivable of $10,466
as of September 30, 2008, together with $6,000 of prepaid expenses
making its total current assets $17,597. On the other hand, total
current liabilities were $2,729,917.
"To date we have funded our operations primarily from multiple
sales of the private placement of our securities to accredited
investors, loans from accredited investors including a Board
advisor and an Institutional placement of a senior loan with the
Aegis New York State Venture Capital Fund. Our Executive Chairman
has also loaned the Company $100,000. We have raised
approximately $5,050,000 to date," Mr. Bishara said.
Mr. Bishara stated, "To date, we have incurred substantial losses,
and will require financing for working capital to meet our
operating obligations. We anticipate that we will require
financing on an ongoing basis for possibly the last quarter of
2008 and the first quarter of 2009, which we will seek. There can
be no assurance that such financing will be available. We intend
to seek to raise up to $5,000,000 in additional funding through
the private issuance of common stock or through the private
issuance of notes. The net proceeds from the offering will be
used to pay down any non-converted Notes including Aegis Capital
and leave the Company in excess of $3,000,000 of net proceeds to
operate and grow sales and earnings for the next twenty-four
months. SLM may also utilize the funds along with its shares to
acquire several other possible private software companies that
management has identified to have compelling synergies to SLM and
our product line. We have not entered into any agreements with
any entity or banker for such financing and there can be no
assurance that we will be able to do so."
"The company has a limited operating history and has incurred
losses from operations since its inception. These circumstances
raise substantial doubt about the company's ability to continue as
a going concern. Management's plans with regard to these matters
include continued development and marketing of its products as
well as seeking additional financing arrangements," Mr. Bishara
said.
A full-text copy of the company's quarterly report is available
for free at: http://researcharchives.com/t/s?3769
Departures
On November 19, 2008, AJ Patel, Brian Byrne, and Doug Zindulka
submitted their resignation from the Board of Directors of SLM
Holdings effectively immediately. The resignation letter submitted
by each of Mr. Patel, Mr. Byrne and Mr. Zindulka stated that their
departure was not caused by any disagreement with the Company on
any matter relating to the Company's operations, policies and
practices.
On November 11, 2008, the Company sent notice to Jon Finkelstein
stating that his services as the Company's Chief Operating Officer
and as a member of the Company's Board of Directors are being
terminated effective on Mr. Finkelstein's receipt of the notice.
The notification sent to Mr. Finkelstein did not reference any
disagreement with the Company on any matter relating to the
Company's operations, policies and practices.
About SLM Holdings
SLM Holdings Inc. is the holding company for its operating
subsidiary, Sales Lead Management, Inc. SLM has developed
software tools and data files which are provided via an
application service provider model to a variety of sales
professionals throughout the country. SLM has devoted
substantially all its efforts to raising capital.
SUN-TIMES MEDIA: Resigning Directors Decide to Stay
---------------------------------------------------
Sun-Times Media Group, Inc., disclosed in a regulatory filing with
the Securities and Exchange Commission that Gordon A. Paris,
Graham W. Savage and Raymond G. H. Seitz, who had stated their
intentions to resign from the company's board of directors
effective Dec. 31, 2008, have agreed to remain on the board of
directors until the time the company is able to recruit and
appoint new directors.
This change was made necessary by the uncertainty engendered by
the consent solicitation process initiated by Davidson Kempner
Capital Management LLC, which has hampered the company's
recruitment of new directors. Subsequent developments in the
contested solicitation of consents initiated by Davidson Kempner
have delayed efforts by the company to recruit and evaluate
candidates for its board of directors. These efforts are ongoing
and will continue with the goal of appointing new director
candidates soon as possible.
Headquartered in Chicago, Sun-Times Media Group Inc. (NYSE: SVN)
-- http://www.thesuntimesgroup.com/-- is a newspaper publisher.
Its media properties include the Chicago Sun-Times and
Suntimes.com as well as newspapers and Web sites serving more than
200 communities throughout the Chicago area.
The Troubled company Reporter reported on Aug. 14, 2008, that at
June 30, 2008, Sun-Times Media Group Inc.'s consolidated balance
sheet showed $721.2 million in total assets and $870.8 million in
total liabilities, resulting in a roughly $149.5 million
stockholders' deficit. The company reported a net loss in the
second quarter of 2008 of $37.8 million, versus net income of
$528.0 million in the same period in 2007.
On Aug. 1, 2007, Hollinger Inc. -- http://www.hollingerinc.com/--
Which owns approximately 70.0% voting and 19.7% equity interest in
Sun-Times Media Group Inc., along with two affiliates, 4322525
Canada Inc. and Sugra Limited, filed separate Chapter 15 petitions
(Bankr. D. Del. Case Nos. 07-11029 through 07-11031). Hollinger
also initiated Court-supervised restructuring under the Companies'
Creditors Arrangement Act (Canada) on the same day.
As reported in the Troubled company Reporter on Nov. 26, 2008,
Sun-Times Media Group, Inc.'s balance sheet at Sept. 30, 2008,
showed total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.
Sun-Times Media reported a net loss in the third quarter ended
Sept. 30, 2008, of $168.8 million compared with a loss of
$192.4 million in the same period in 2007.
* * *
The Troubled Company Reporter said on Nov. 26, 2008, that Sun-
Times Media Group, Inc.'s balance sheet at Sept. 30, 2008, showed
total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.
SUNWEST MANAGEMENT: Chief Executive Files for Chapter 11
--------------------------------------------------------
Sunwest Management Inc. Chief Executive Jon M. Harder filed a
personal chapter 11 petition before the U.S. Bankruptcy Court for
the District of Oregon.
According to Bloomberg's Bill Rochelle, Mr. Harder joins 20
Sunwest entities that are already in bankruptcy protection. Mr.
Harder personally guaranteed much of the Sunwest companies' $1.8
billion in secured debt.
Sunwest has 280 senior living facilities providing care for
18,000 residents. The report notes that the properties together
are worth $2 billion, and that unsecured creditors are valued at
$76 million. Annual revenue is $500 million.
The case is Jon M. Harder, 08-37225, U.S. Bankruptcy Court,
District of Oregon (Portland).
As reported by the Nov. 26 issue of the Troubled Company Reporter,
which cited Bloomberg News, Sunwest Management was authorized by
the U.S. Bankruptcy Court for the Middle District of Tennessee
(Nashville) on Nov. 20 to sell seven facilities in North and South
Carolina for $44 million to Five Star Quality Care Inc.
Sunwest Management Inc. reached a deal with Boston-based senior
housing company Five Star Quality Care, The Oregonian reports.
The sale -- which includes Sunwest Management's seven retirement
communities in North and South Carolina -- has a price that is
short of the $56 million Sunwest Management owes to its largest
lender, GE Business Financial Services Inc., the report notes.
Sunwest owes another $31.2 million to two other secured creditors.
Salem, Oregon-based Sunwest Management Inc. --
http://www.sunwestmanagement.com/-- manages 275 assisted-living
facilities in 36 states. Sunwest Management was founded in 1991
with a portfolio of three properties: two retirement communities
and one skilled nursing community. It has a network of regional
managers that handles various services from accounting to
operations.
Sunwest Management has put 10 assisted living centers -- two in
Oregon -- into Chapter 11 bankruptcy. Briarwood Retirement and
Assisted Living Community LLC, which owns a retirement center in
Springfield, and Century Fields Retirement and Assisted Living
Community LLC, which owns a center in Lebanon, filed for Chapter
11 on Aug. 19, 2008. On Aug. 17, 2008, eight Sunwest-affiliated
LLCs filed
SUPERIOR AIR: Files for Chapter 11 Protection
---------------------------------------------
Paul Bertorelli at AVweb reports that Superior Air Parts, Inc.,
has filed for Chapter 11 protection in the U.S. Bankruptcy Court
for the Northern District of Texas.
According to AVweb, Superior Air said it is continuing to fill and
ship orders and that Textron Lycoming is continuing the
acquisition of most of its assets. The report says that Textron
Lycoming didn't buy Superior Air's Millennium cylinder line for
Teledyne-Continental engines which, presumably, represent yet
another asset Superior Air can sell.
Superior Air's Kent Abercrombie told AVweb that Superior Air is
maintaining sufficient staff to accept and fill orders, after
laying off staff following its Dec. 31 bankruptcy filing.
AVweb relates that Superior Air's XP experimental engine program
will continue, but its owner-build program for homebuilders has
been temporarily suspended.
When Superior Air's parent company, Thielert Aero Engines, filed
for insolvency in Germany, Superior Air's shipments of its
Millennium cylinder line were disrupted, AVweb states. Citing
Mr. Abercrombie, AVWeb reports that Superior Air has continued to
deliver cylinders, but at a slower pace. Mr. Abercrombie said
that cylinder delivery lead times have been improved over the past
couple of months, the report says.
Coppell, Texas-based Superior Air Parts, Inc. --
http://www.superiorairparts.com-- makes aircraft piston for
Lycoming and Continental engines. The company filed for Chapter
11 protection on Dec. 31, 2008 (Bankr. N.D. Texas Case No. 08-
36705). Stephen A. Roberts, Esq., at Strasburger & Price, LLP,
assists the company in its restructuring effort. The company
listed assets of $10 million to $50 million and debts of
$10 million to $50 million.
SUPERIOR AIR: Seeks to Sell All Assets to Textron
-------------------------------------------------
Superior Air Parts Inc. seeks permission from the U.S. Bankruptcy
Court for the Northern District of Texas to sell substantially all
of its assets to Avco Corporation, or to another party with a
higher bid.
Avco, a subsidiary of Textron, Inc., has offered to purchase
Superior Air for $11.5 million.
Road to Sale of Business
On April 30, 2008, Thielert AG, Superior Air's owner, filed an
insolvency proceeding in Hamburg, Germany and Dr. Achim Ahrendt
was appointed as the preliminary Insolvency Administrator.
Thielert Aircraft Engines GmbH, which had been providing engine
parts to Superior on credit, also filed an insolvency proceeding
in Germany. D r. Ahrendt determined that it was in the best
interest of Thielert and Superior to sell Superior or its
assets. In June 2008, Superior hired Corporate Finance Partners
Midcap GmbH, a German investment company based in Berlin, Germany
to serve as its investment advisor and to seek possible suitors
for Superior.
CFP canvassed the market, negotiated with numerous potential
purchasers, and enabled interested parties to conduct substantial
due diligence.
As a result of those efforts, Superior entered into the APA with
Avco Corporation, a wholly owned subsidiary of Textron Inc., the
highest bidder to date, pursuant to which Avco Corp. has agreed to
buy substantially all of Superior's assets for $11.5 million,
subject to adjustments for inventory reductions after Oct. 31,
2008.
One of the conditions of the purchase agreement was that the
purchase be consummated through a Chapter 11 bankruptcy
proceeding.
Feb. 24 Sale Hearing
According to the Debtor, the Chapter 11 case was filed to
liquidate the assets of Superior and to obtain the highest and
best price for creditors, either through the purchase agreement
with Textron Inc. or a public auction.
The Debtor, however, seeks a fast-tracked sale of its assets.
Superior Air said that due to the nature of its business, it is
not feasible for the Debtor to continue to assemble and sell small
engines or to sell parts when the sale of substantially all of its
assets is pending. The longer the Debtor must continue to operate
in this mode, the less funds will be available to pay creditors.
The Debtor is still accepting bids and will conduct an auction if
qualified bids are received. The Debtor will seek approval of the
sale at a hearing on Feb. 24, 2009. Avco may terminate the APA if
the Court does not approve the sale by March 31.
About Superior Air
Superior Air Parts, Inc. is a Texas corporation with its offices
and operating facilities located in Coppell, Dallas County, Texas.
It was founded in 1967 in order to supply the United States Air
Force and commercial customers with replacement parts for piston
powered aircraft engines. Superior is one of the largest
suppliers of parts under Federal Aviation Administration's Parts
Manufacturer Approval regulations for piston engines. It provides
Superior-brand parts for engines created by two primary original
equipment manufacturers, the Continental division of Teledyne,
Inc. and the Lycoming division of Textron Inc. Its customers are
companies that perform maintenance and overhaul work in the
general aviation industry. Superior is also an OEM for the 180-
horsepower Vantage Engine and owner-built XM-360 engines for
various aircraft companies.
In 2006, 100% of the ownership interests of Superior was acquired
by Thielert, AG, a German corporation based out of Hamburg,
Germany. Also in 2006, Thielert purchased the debt of Superior's
senior secured lender and subordinated lenders secured by
substantially all of the Debtor's assets.
Superior Air Parts filed for Chapter 11 on Dec. 31, 2008 (Bankr. ,
N.D. Tex., Case No. 08-36705). Judge Barbara J. Houser handles
the case. The Debtor's counsel is Stephen A. Roberts, Esq., at
Strasburger & Price, LLP, in Austin Texas. In its bankruptcy
petition, the Debtor estimated assets and debts of $10 million to
$50 million each.
TERMOEMCALI LEASING: Fitch Raises Rating on $153.7MM Notes to 'B-'
------------------------------------------------------------------
Fitch Ratings has upgraded the rating of Termoemcali's
$153.7 million restructured senior secured notes due 2019 to 'B-'
from 'CCC'; the Rating Outlook is Stable.
The rating action reflects Termoemcali's improved flexibility to
meet its debt service obligations primarily from expected
reliability payments and to a lesser extent from gas sales. The
rating action also considers the reduced dependence on the
capacity (Tranche E) payments from Emcali (rated 'CCC', Stable
Outlook by Fitch), which constrained the previous rating. To
date, the project's operational performance has been stable.
Towards the end of 2006, the Colombian electric sector changed the
way to pay for hydraulic and thermal plants' systems, changing
from capacity payments to reliability payments. This meant that
the system would acknowledge the energy the generator is committed
to deliver, resulting in higher revenues. This payment is
dependent on certain plant characteristics such as capacity,
availability, fuel flexibility, and fuel supply and transportation
contracts.
As certified by the Colombian electric sector, Fitch understands
that the plant's assessed capacity for 2008 and 2009 is 170
megawatts resulting in approximately $20 million in reliability
payments for the respective years. Termoemcali's reliability
payments are determined through a bidding process; to date, the
project has been awarded reliability payments beginning in 2011
through 2013 ranging from $22 million to $24 million annually.
Given the need for new capacity in the Colombian electric sector,
Fitch expects reliability payments to be stable beyond 2013.
Although Termoemcali has long term fixed-price fuel supply
contracts, as a peaking unit it generates minimal electricity,
resulting in reduced fuel usage. Excess fuel is sold to a third
party under a fixed price agreement, generating positive cash flow
which is viewed favorably by Fitch. Termoemcali has fixed price
contracts for natural gas supply with Ecopetrol (rated 'BB+',
Stable Outlook by Fitch) through Jan. 1, 2015 and for #2 fuel oil
with Exxon Mobil (rated 'AAA' by Fitch) until 2014. Fitch views
that even in the absence of Tranche E payments from Emcali,
cashflows from reliability payments and gas sales should be able
to meet the debt service obligations.
To date, Emcali has honored the Tranche E payments on a monthly
basis to Termoemcali, in accordance with the 2005 debt
restructuring. For 2008 through September, the debt service
coverage ratio was approximately 2.15 times, inclusive of Tranche
E payments, and 1.07x without the Tranche E payments. Fitch
believes that the ongoing financial performance of the project
will continue to remain stable.
Termoemcali Leasing, Ltd. is engaged in the ownership of certain
equipments that have been incorporated into a natural gas-fired,
233.8 (net) MW electric generating facility constructed near
Santiago de Cali, Colombia (rated 'BB+', Stable Outlook by Fitch).
Termoemcali I S.A. E.S.P. has developed the Facility and has
leased equipment from Leaseco. The debt was issued on behalf of
Leaseco and the company by Termoemcali Funding corp.
THORNBURG MORTGAGE: Issues 14,176,464 Shares to Counterparties
-------------------------------------------------------------
Thornburg Mortgage Inc. said in a filing with the Securities and
Exchange Commission that it issued warrants exercisable into an
aggregate 14,176,464 shares of common stock. Pursuant to the
Amended and Restated Override Agreement, the warrants are
immediately exercisable at an exercise price of $0.01 per share
and expire on Dec. 18, 2013.
A full-text copy of the Amended And Restated Override Agreement is
available for free at http://ResearchArchives.com/t/s?3680
Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages. It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets. Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.
As reported by the Troubled Company Reporter on Nov. 20, 2008,
Thornburg has not paid the interest payment due on Nov. 15, 2008,
on its 8% Senior Notes, because it currently does not have
available funds to do so. The company is in active negotiations
with the counterparties to the Override Agreement and expects to
pay the $12.2 million interest payment once an amended and
restated agreement has been reached with the counterparties to the
Override Agreement and within the 30-day grace period under the
indenture.
* * *
As reported in the Troubled Company Reporter on Dec. 22, 2008,
Standard & Poor's Ratings Services raised its counterparty credit
rating on Thornburg Mortgage Inc. to 'CC' from 'D'. At the same
time, S&P also raised its rating on Thornburg's senior notes to
'CC' from 'D'. The outlook is negative.
TRIBUNE CO: U.S. Trustee Appoints Wilmington to Creditors Panel
---------------------------------------------------------------
Roberta A. DeAngelis, acting United States Trustee for Region 3,
appointed Wilmington Trust Company, in its capacity as successor
indenture trustee, as the ninth member to the Official Committee
of Unsecured Creditors in Tribune Co.'s bankruptcy case.
The Creditors Committee now consists of:
(1) JPMorgan Chase Bank, N.A.
Attn: Miriam Kulnis
277 Park Avenue, 8th Floor
New York, NY 10172
Tel: 212-622-4526
Fax: 212-622-4556
(2) Merrill Lynch Capital Corporation
Attn: Michael O'Brien
4 World Financial Center
250 Vesey Street
New York, NY 10080
Tel: 212-449-0948
Fax: 212-738-1186
(3) Deutsche Bank Trust Company Americas
Attn: Stanley Burg
60 Wall Street
New York, NY 10005
Tel: 212-250-5280
Fax: 212-797-8610
(4) Warner Bros. Television
Attn Wayne M. Smith
4000 Warner Boulevard
Building 156, Room 5158
Burbank, CA 91522
Tel: 818-954-6007
Fax: 818-954-5434
(5) Vertis, Inc.
Attn: John V. Howard, Jr., Esq.
250 West Pratt Street
Baltimore, MD 21201
Tel: 303-305-2025
Fax: 410-454-8460
(6) William Niese
6061 Lake Vista Dr.
Bonsall, CA 92003
Tel: 760-758-7101
(7) Pension Benefit Guaranty Corporation
Attn: Craig Yamaoka
1200 K Street, NW
Washington, D.C. 20005
Tel: 202-326-4000 x 3614
Fax: 202-842-2643
(8) Washington-Baltimore Newspaper Guild
Local 32035
Attn: Robert E. Paul or William Salganik
1100 15th Street, N.W., Suite 350
Washington, D.C. 20005
Tel: 202-785-3650
Fax: 202-785-3659
(9) The Wilmington Trust Co.
1100 North Market Street
Wilmington, DE 19890
Tel: (302) 636-6391
Fax: (302) 636-4149
JP Morgan Chase, Merrill Lynch, Deutsche Bank, and Warner Bros.
are listed as one of the Debtors' largest unsecured creditors:
JP Morgan $1,482,000,000
Merrill Lynch 2,037,000,000
Deutsche Bank 2,898,000,000
Warner Bros. 23,000,000
Mr. Niese is former senior vice president and general counsel of
The Times Mirror Company, which was acquired by Sam Zell in 2000.
Headquartered in Chicago, Illinois, Tribune Company --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball
team. The company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No.
08-13141). The Debtors proposed Sidley Austion LLP as their
counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware
counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as
financial advisors; and Epiq Bankruptcy Solutions LLC as claims
agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in
total assets and $12,972,541,148 in total debts. (Tribune
Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
TRUMP ENTERTAINMENT: Has Until Jan. 21 to Pay Due on 8.5% Notes
---------------------------------------------------------------
Trump Entertainment Resorts Holdings, L.P., disclosed in a
regulatory filing that it has obtained a forbearance agreement
from the holders of an aggregate of approximately 70% of the
outstanding principal amount of the 8.5% senior secured notes due
2015.
To recall, the company and its unit, Trump Entertainment Resorts
Funding, Inc. did not make the interest payment due Dec. 1, 2008,
on the Senior Notes.
Pursuant to the Forbearance Agreement, the Senior Noteholders have
agreed to forbear from exercising their rights and remedies under
the indenture governing the Notes relating to the missed interest
payment, and from directing the trustee under the indenture from
exercising any such rights and remedies on the holders' behalf,
until Jan. 21, 2009, unless certain events occur.
In addition, Trump has obtained a forbearance agreement from the
lenders under its $490 million senior secured term loan agreement,
pursuant to which the lenders have agreed to forbear from
exercising certain of their rights and remedies that may exist as
a result of the missed interest payment on the Notes, until
Jan. 21, 2009, unless certain events occur.
The company remains in discussions with its lenders and certain
Note holders regarding a possible restructuring of the company's
capital structure. There can be no assurance that any agreement
with respect to any restructuring will be reached or, if any
agreement is reached, as to the terms thereof.
About Trump Entertainment Resorts Inc.
Based in Atlantic City, New Jersey, Trump Entertainment Resorts
Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and
operates three casino hotel properties in Atlantic City, New
Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza
Hotel and Casino, and Trump Marina Hotel Casino. The company
conducts gaming activities and provides customers with casino
resort and entertainment.
Donald Trump is a shareholder of the company and, as its non-
executive Chairman, is not involved in the daily operations of the
company. The company is separate and distinct from Mr. Trump's
privately held real estate and other holdings, which the company
understands encompasses substantially all of his net worth.
As reported in the Troubled Company Reporter on Nov. 12, 2008,
Trump Entertainment Resorts, Inc. reported that for three months
ended Sept. 30, 2008, its net loss was 139.1 million compared to
net income of $6.6 million for the same period in the previous
year.
For nine months ended Sept. 30, 2008, the company's net loss was
$187.6 million compared to net loss of $15.0 million for the same
period in the previous year.
At Sept. 30, 2008, the company's balance sheet showed total assets
of $2.07 billion, total liabilities of $2.03 billion and
shareholders' deficit of about $44.8 million.
* * *
Trump Entertainment Resorts Inc.'s 8-1/2% senior secured notes due
2015 carry Moody's Investors Service's Caa1 rating which was
placed in April 2008 and Standard & Poor's CCC+ rating which was
placed in May 2008.
TYSON FOODS: Dick Bond Resigns as President & CEO
-------------------------------------------------
Dick Bond, president and chief executive officer of Tyson Foods,
Inc. said on Monday that he is leaving the company, effective
immediately. Leland Tollett, former chairperson and CEO of Tyson
Foods, has agreed to return to the company to take Mr. Bond's
place on an interim basis until a permanent successor has been
chosen.
"After seven years of helping lead or leading the world's largest
meat company, I have decided it is in both my best interest
personally, and the best interest of the company for me to move on
and pursue other interests," Mr. Bond said. "I have a lot of both
my time and personal finances invested in Tyson Foods, so I wish
the company all the best for future success."
Additionally, Donnie Smith, longtime Tyson executive, is being
named senior group vice president of Poultry and Prepared Foods,
and will have overall responsibility for those divisions of the
company.
Founded in 1935 with headquarters in Springdale, Arkansas, Tyson
Foods, Inc. (NYSE: TSN) -- http://ir.tyson.com-- is the world's
largest processor and marketer of chicken, beef and pork, the
second-largest food production company in the Fortune 500 and a
member of the S&P 500. The company produces a wide variety of
protein-based and prepared food products and is the recognized
market leader in the retail and foodservice markets it serves.
Tyson provides products and service to customers throughout the
United States and more than 90 countries. The company has
approximately 107,000 Team Members employed at more than 300
facilities and offices in the United States and around the world.
Tyson Foods disclosed $10.8 billion in total assets, including
$4.3 billion in current assets; $5.8 billion in total liabilities,
including 44.3 billion in current liabilities for the quarter
ended September 30, 2008.
As reported by the Troubled Company Reporter on Dec. 22, 2008,
Moody's Investors Service affirmed the ratings of Tyson Foods,
Inc., including its corporate family at Ba3, its probability of
default ratings at Ba3, and its speculative grade liquidity rating
of SGL-4. These rating actions incorporate the recent amendment
to Tyson's revolving credit agreement which provides covenant
relief over the next several quarters and greater collateral for
certain debt instruments. Moody's said that the rating outlook
remains negative.
On September 4, 2008, Standard & Poor's downgraded the credit
rating applicable to the company's senior notes due April 1, 2016,
from "BBB-" to "BB." This downgrade increased the interest rate
on the 2016 Notes from 6.85% to 7.35%, effective beginning with
the six month interest payment due October 1, 2008.
US SHIPPING: Moody's Downgrades Corporate Family Rating to 'Ca'
---------------------------------------------------------------
Moody's Investors Service downgraded its debt ratings of U.S.
Shipping Partners L.P. -- corporate family to Ca from Caa3,
probability of default to D from Caa3, first lien senior secured
to Caa3 from Caa2 and second priority senior secured to C from Ca.
The downgrades follow USS' January 5, 2009 disclosure in a Form 8-
K that it did not pay the principal or interest due on December
31, 2008 under its senior secured credit agreement. USS also
disclosed that the failure to make these scheduled payments
constitutes an event of default under its interest rate swap
agreements. The outlook is negative.
The probability of default rating of D reflects that the timely
payment of interest and principal amortization did not occur.
Moody's observes that, pursuant to Section 8.1.1 of the Third
Amended and Restated Credit Agreement dated August 7, 2006, the
Credit Agreement's terms do not provide a grace period for a
payment default (interest or principal) related to the revolver or
term loan, while a five day grace period is provided for a payment
default related to any other Obligation (as defined).
USS also disclosed that it has entered into a Forbearance
Agreement with credit facility lenders in which lenders have
agreed to not take any action nor exercise any right or remedy
with respect to the missed payment of principal and interest prior
to 5.00 pm Eastern time on February 10, 2009. However, the
occurrence of any other event of default pursuant to the Credit
Agreement's terms or USS not negotiating in good faith with the
administrative agent regarding restructuring and strategic
alternatives would result in the early termination of the
Forbearance Agreement. The Forbearance Agreement precludes the
administrative agent from foreclosing on USS' assets during its
term, which prevents any other secured party from initiating a
foreclosure while the Forbearance Agreement remains in effect.
USS also disclosed that the current waiver of any potential
defaults under the Credit Agreement's financial covenants will
expire on January 31, 2009; and, absent an additional waiver by
the lenders, the Forbearance Agreement will terminate on that
date. The next interest payment on the $100 million of 13.0%
Second Priority Senior Secured Notes due August 15, 2014 is due on
February 15, 2009.
Moody's believes that the expected family recovery rate is not
materially different from the standard 50% assumption of its Loss
Given Default Rating Methodology. Moody's applied a four times
multiple to its estimate of 2009 run rate EBITDA that USS' fleet
of ATB's and chemical or petroleum tankers (aggregate of eight
vessels, including one ATB still under construction) would
generate to assess the enterprise value of a reorganized USS.
Moody's also considered the liquidation value of these eight
vessels and the four remaining ITB (integrated tug-barge) vessels
in the event USS does not continue to operate. Each supports
Moody's belief of about a 50% expected family recovery rate. The
LGD-3 Loss Given Default Assessment of the senior secured credit
facility indicates that the potential exists for lenders to
receive less than a full recovery. The LGD-5 Loss Given Default
Assessment of the second priority senior secured notes implies a
significant loss on these notes.
The previous rating action for USS was on May 13, 2008, when
Moody's downgraded the company's ratings; corporate family rating
to Caa3 from Caa1, fist lien senior secured to Caa2 from B3 and
second lien senior secured to Ca from Caa3.
Downgrades:
Issuer: U.S. Shipping Partners LP
* Probability of Default Rating, Downgraded to D from Caa3
* Corporate Family Rating, Downgraded to Ca from Caa3
* Senior Secured Bank Credit Facility, Downgraded to Caa3 from
Caa2
* Senior Secured Regular Bond/Debenture, Downgraded to C from Ca
U.S. Shipping Partners L.P., based in Edison, New Jersey, is a
leading, U.S. Jones Act qualified, provider of marine
transportation of petroleum and petroleum based products.
UTSTARCOM INC: To Wind Down Korea BU and Cut 10% of Workforce
-------------------------------------------------------------
UTStarcom, Inc., disclosed a series of corporate initiatives that
are expected to reduce its annualized operating expenses by more
than 25% or greater than $100 million. The majority of these
measures will have been initiated by the end of January 2009 and a
significant portion of the savings will be recognized in the first
half of 2009.
The actions disclosed represent a continuation of the strategic
plan UTStarcom outlined in September of 2007. Since the beginning
of 2008, the company has divested a number of non-core business
units and increased its net cash position by $150 million.
"Over the past twelve months, we have achieved a year-over-year
OPEX reduction of 20% and streamlined our business to improve our
competitive and financial position," said Peter Blackmore,
UTStarcom's CEO and president. "These additional measures will
reduce our annualized expense base by another 25% or $100 million.
Importantly, these actions will advance our strategic goals by
increasing our focus on our IP-based portfolio targeting the
developing regions of the world."
Rationalization of Non-Core Businesses
On Dec. 16, 2008, UTStarcom initiated actions to wind down its
Korea-based handset manufacturing operation whose principal
activity is supplying handsets to Personal Communications Devises
LLC. This wind down will occur over the next six months to enable
the company to meet current customer commitments in North America
and the process will be complete by July 2009.
The company's Handset segment will continue to supply handsets to
the China market.
Additionally, the company has initiated actions to disband its
Custom Solutions Business Unit by the end of the first quarter
2009.
Additional 10% Savings Through Headcount and SG&A Reductions
In the fourth quarter 2008 and first quarter 2009 the company will
reduce its worldwide employee base by approximately 10%. This
reduction is in addition to the employees impacted by the
identified non-core business rationalizations.
In addition, the company also disclosed that the non-executive
members of the board have agreed to a reduction in their board
retainers for a period of one year. Furthermore, Peter Blackmore,
UTStarcom's CEO and president, and other executive officers have
voluntarily agreed to decline their cash bonuses for 2008.
Although each geographic region and business will be affected,
management's plan will protect the most strategically important
R&D investments, customer relationships and product areas.
Consolidation of Back Office Functions in China
Over the past twelve months the company has implemented a number
of IT systems and operational enhancements. With the improved
operational capability, the company is now able to eliminate
functional duplication and consolidate a number of back office
functions into our China operations. This process will start in
the first quarter of 2009 and be executed over the first three
quarters of 2009.
Restructuring Charge
In connection with the wind down of the Korea-based handset
manufacturing business the company expects to incur a
restructuring charge of approximately $10 million, consisting of
write-downs of assets and one-time severance benefits. This
charge is expected to be taken in the fourth quarter of 2008.
The company also expects to incur a restructuring charge in
connection with the worldwide reduction in workforce not related
to the wind down of the Korea-based handset manufacturing of
approximately $8 million comprised of one-time severance benefits.
This charge is also expected to be taken in the fourth quarter of
2008.
About UTStarcom Inc.
Headquartered in Alameda, California, UTStarcom Inc. (Nasdaq:
UTSI) -- http://www.utstar.com/-- provides IP-based, end-to-end
networking solutions and international service and support. The
company develops, manufactures and markets its broadband,
wireless, and terminal solutions to network operators in both
emerging and established telecommunications markets worldwide.
UTStarcom was founded in 1991 and is headquartered in Alameda,
California. The company has research and development centers in
the USA, Canada, China, Korea and India.
The net loss for the third quarter of 2008 was $55.9 million as
compared to a net loss of $55.3 million in the third quarter of
2007.
Net cash and cash equivalents as of Sept. 30, 2008, was
$331.0 million compared to $180.0 million on Dec. 31, 2007. The
increase reflects proceeds from the sale of PCD and certain short
term investments partially offset by operating usage of cash.
At Sept. 30, 2008, the company's balance sheet showed total assets
of $1.4 billion, total liabilities of $902.1 million and
stockholders' equity of $539.0 million.
Going Concern Doubt
PricewaterhouseCoopers LLP, in San Jose, California, expressed
substantial doubt about UTStarcom Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2007. The auditing firm
pointed to the company's recurring net losses, negative cash flows
from operations and significant debt obligations.
VISTEON CORPORATION: Board Elects President and CEO as Chairman
---------------------------------------------------------------
The board of directors of Visteon Corporation has elected
president and CEO Donald J. Stebbins to the additional position of
chairman of the board, effective Dec. 1, 2008. Mr. Stebbins
succeeds Michael F. Johnston, who will retire as executive
chairman November 30 after eight years in senior leadership
positions with the global automotive supplier.
Mr. Stebbins joined Visteon in 2005 as president and chief
operating officer, and was elevated to CEO by the board on June 1,
2008. He has more than 20 years of leadership experience in
global operations and finance, including 13 years in senior
leadership positions with Lear Corporation before joining Visteon.
His election as chairman is aligned with Visteon's long-term
executive succession planning process.
"[Mr.] Stebbins has the experience, drive and foresight to lead
through tough economic times and steer Visteon into the future,"
Mr. Johnston said. "[Mr. Stebbins] has done an excellent job
leading the organization and spearheading the execution of our
restructuring plan. His commitment to operational excellence has
helped improve Visteon's cost structure, expand our capabilities
in growth markets such as Asia Pacific, and enhance performance in
areas ranging from product quality to employee safety."
"I look forward to continuing Visteon's transformation, and
capitalizing on our talented workforce and global capabilities to
deliver on our commitments to customers, shareholders and
employees," Mr.Stebbins said.
Mr. Johnston joined Visteon in September 2000 as chief operating
officer and president, and was elected CEO in June 2004. He
became chairman and CEO in June 2005. He has served as executive
chairman since June 1, when Mr. Stebbins was elected CEO as part
of a planned transition. Mr. Johnston is credited with guiding
Visteon from a North America-focused components supplier that was
heavily dependent on one automaker, to a worldwide engineering and
manufacturing company with a focused product portfolio and a
diversified customer base. He has served on Visteon's board of
directors since April 2002 and will leave the board upon his
retirement.
"The board expresses its appreciation and gratitude to [Mr.]
Johnston for his leadership and steadfast commitment to
positioning Visteon for success in an increasingly competitive
global market," William H. Gray III, chairman of the corporate
governance and nominating committee of Visteon's board of
directors, said. "Visteon took a number of strategic steps under
Mike's leadership that have provided a critical foundation for the
company's long-term future."
Mr. Stebbins joined Visteon from Lear Corporation, where he was
president and chief operating officer of operations in Europe,
Asia and Africa. Before that, he was president and chief
operating officer of Lear's operations in the Americas. He joined
Lear in 1992 as vice president and treasurer, and held various
financial positions of increasing responsibility, including senior
vice president and chief financial officer. He held positions at
Bankers Trust Co. and Citibank.
Mr. Stebbins has a bachelor's degree from Miami University in
Oxford, Ohio, where he is a member of the Business Advisory
Council. He holds a master's degree in business administration
from the University of Michigan. He has served on Visteon's board
of directors since December 2006. He is a member of the board of
directors of WABCO Holdings Inc. and the board of trustees of
Detroit Country Day School.
About Visteon Corporation
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is an automotive supplier
that designs, engineers and manufactures innovative climate,
interior, electronic and lighting products for vehicle
manufacturers, and also provides a range of products and services
to aftermarket customers. The company also has corporate offices
in Shanghai, China; and Kerpen, Germany; the company has
facilities in 26 countries and employs approximately 38,500
people.
As reported in the Troubled Company Reporter on Nov. 4, 2008,
Visteon Corporation's balance sheet at Sept. 30, 2008, showed
total assets of $5.9 billion and total liabilities of
$6.4 billion, resulting in shareholders' deficit of roughly
$530 million.
The company reported a net loss of $188 million on total sales of
$2.11 billion. For third quarter 2007, Visteon reported a net
loss of $109 million on sales of $2.55 billion.
Visteon reported a net loss of $335 million for the first nine
months of 2008, compared with a net loss of $329 million for the
same period a year ago.
* * *
TCR reported on Nov. 27, 2008, that Moody's Investors Service
lowered Visteon Corporation's corporate family and probability of
default ratings to Caa2, and Caa1, respectively. In a related
action, Moody's also lowered the ratings of Visteon's senior
secured term loan to B3 from Ba3, unguaranteed senior unsecured
notes to Caa3 from Caa2, and guaranteed senior unsecured notes to
Caa2 from Caa1. Visteon's Speculative Grade Liquidity remains
SGL-3. The outlook is negative.
VISTEON CORPORATION: Withdraws Full-year 2008 Financial Guidance
----------------------------------------------------------------
Visteon Corporation disclosed in a filing with the Securities and
Exchange Commission that it has withdrawn its full-year 2008
financial guidance in light of the larger-than-anticipated
declines in worldwide vehicle production and overall industry
uncertainty.
"Given that ongoing economic pressures have continued to
significantly reduce our customers' production schedules across
the world, Visteon is withdrawing its issued 2008 financial
guidance," Donald J. Stebbins, chairman and chief executive
officer, said. "We have taken aggressive actions over the past
three years to restructure and improve our business," Mr. Stebbins
said, "and we continue to take the actions necessary to align our
manufacturing capacity and cost structure with the rapidly
changing economic and market environment."
In a separate filing, Visteon disclosed that it has received a
notification from the New York Stock Exchange that it had fallen
below a continued listing standard that requires the company's
average total market capitalization over a consecutive 30 trading-
day period to equal or exceed $75 million and, at the same time,
total reported stockholders' equity to equal or exceed
$75 million.
Under NYSE rules, Visteon has 45 days from receipt of this notice
to submit a plan to the NYSE to demonstrate its ability to achieve
compliance with the continued listing requirements within
18 months. Visteon intends to submit such a plan. If the NYSE
accepts Visteon's plan, Visteon's common stock will continue to be
listed on the NYSE during the cure period, subject to ongoing
monitoring and the company's compliance with other NYSE continued
listing requirements.
Visteon's business operations, SEC reporting requirements, credit
agreements and other debt obligations are not otherwise affected
by this notification.
On Nov. 20, 2008, Visteon also received notification from the NYSE
that the company had fallen below its continued listing standard,
which requires a minimum average closing price of $1.00 per share
over 30 consecutive trading days.
Visteon plans to notify the NYSE that it intends to cure the
deficiency. The company has a period of six months to bring its
average share price back above $1.00. Under NYSE rules, Visteon's
common stock will continue to be listed on the NYSE during the
cure period, subject to the company's compliance with other NYSE
continued listing requirements.
About Visteon Corporation
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is an automotive supplier
that designs, engineers and manufactures innovative climate,
interior, electronic and lighting products for vehicle
manufacturers, and also provides a range of products and services
to aftermarket customers. The company also has corporate offices
in Shanghai, China; and Kerpen, Germany; the company has
facilities in 26 countries and employs approximately 38,500
people.
As reported in the Troubled Company Reporter on Nov. 4, 2008,
Visteon Corporation's balance sheet at Sept. 30, 2008, showed
total assets of $5.9 billion and total liabilities of
$6.4 billion, resulting in shareholders' deficit of roughly
$530 million.
The company reported a net loss of $188 million on total sales of
$2.11 billion. For third quarter 2007, Visteon reported a net
loss of $109 million on sales of $2.55 billion.
Visteon reported a net loss of $335 million for the first nine
months of 2008, compared with a net loss of $329 million for the
same period a year ago.
* * *
TCR reported on Nov. 27, 2008, that Moody's Investors Service
lowered Visteon Corporation's corporate family and probability of
default ratings to Caa2, and Caa1, respectively. In a related
action, Moody's also lowered the ratings of Visteon's senior
secured term loan to B3 from Ba3, unguaranteed senior unsecured
notes to Caa3 from Caa2, and guaranteed senior unsecured notes to
Caa2 from Caa1. Visteon's Speculative Grade Liquidity remains
SGL-3. The outlook is negative.
WASHINGTON MUTUAL: Can Hire Robert Williams as President
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Washington Mutual Inc. and WMI Investment Corp. to hire Robert J.
Williams as president nunc pro tunc to November 10, 2008.
The Debtors have noted, in consultation with the Official
Committee of Unsecured Creditors, that Mr. Williams' employment
will ensure the successful completion of outstanding and
important tasks with respect to the disaggregating of their
operations, assets and liabilities.
Since 2005, Mr. Williams served as WaMu's treasurer and chief
financial planner who became responsible for, among other things,
maintaining and revising WaMu's capital structure, arranging for
the issuance of the Company's debt securities, and planning for
the Company's diversified funding investments.
In addition, Mr. Williams managed WaMu's assets and liabilities
profile and oversaw its cash management system, while serving on
WaMu's pension plan and investment plan committees. He also
oversaw the management of WaMu's investments in its bank-owned
life insurance and corporate-owned life insurance.
Given his substantial role in WaMu's operations, Mr. Williams had
maintained contact with the Office of Thrift Supervision and has
first-hand knowledge of the events concerning WaMu up to the
Petition Date. In this regard, the Debtors believe that the
employment of Mr. Williams will result in the effective
administration of their estates, Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware, avers.
Terms of Mr. William's Employment
As President to WaMu, Mr. Williams is expected to work in
collaboration with William C. Kosturos, the Debtors' chief
restructuring officer, and with the members of Alvarez and Marsal
North America, LLC, as the Debtors' financial restructuring
advisors.
Mr. Williams will also work with former WaMu employees to gather
and disseminate information regarding the Debtors' cases,
negotiate resolutions with JPMorgan Chase Bank, N.A., as acquirer
of Washington Mutual Bank, and help formulate a plan of
reorganization.
The Debtors will pay for Mr. Williams' services on a monthly
basis, pro rated from the time he began his employment.
Essentially, he will be paid according to these periods:
(1) Critical Period, or from November 13, 2008 to March 12,
2009, Mr. Williams will receive $175,000 per month and
will serve as full-time officer and employee of WaMu.
(2) Transition Period, or from March 13, 2009 to November 13,
2009, Mr. Williams will receive $75,000 per month and will
serve as president on a part-time capacity.
(3) Consulting Period, or from November 14, 2009 to March 14,
2010, Mr. Williams will be paid $50,000 monthly and will
serve as president or in other office as may be designated
by WaMu's board of directors, in a part-time capacity.
Mr. Collins relates that the Debtors, in consultation with the
Official Committee of Unsecured Creditors, believe that Mr.
Williams' employment will ensure the successful completion of
outstanding and important tasks with respect to the
disaggregating of the Debtors and their subsidiaries' operations,
assets and liabilities.
The Debtors maintain that Mr. Williams is the best person to fill
the role as president of WaMu because of his historical and
institutional knowledge of the Company, as well as his
familiarity with the Debtors' financial structure.
Mr. Collins notes that Mr. Williams' knowledge of the Debtors'
cash management system will help in reconstructing relationships
among WaMu, its non-debtor subsidiaries, and WMB to better
understand where assets are currently being held. His
relationship with WaMu's regulatory agencies will also ensure a
productive dialogue regarding information access and asset
collection, Mr. Collins avers.
WHITEHALL JEWELERS: Wants Plan Filing Period Extended to April 20
-----------------------------------------------------------------
Whitehall Jewelers Holdings, Inc., and Whitehall Jewelers, Inc.,
ask the U.S. Bankruptcy Court for the District of Delaware to
further extend their exclusive periods to:
a) file a plan through and including April 20, 2009; and
b) solicit acceptances with respect to plan, through and
including June 22, 2009.
This is the Debtors' second extension request of their exclusive
periods to file and solicit votes on a Chapter 11 plan. The
Debtors tell the court that they will use the requested extension
to complete the wind down of their estates in an orderly and
efficient manner without the distraction, delay and costs
associated with competing plans.
Headquartered in Chicago, Illinois, Whitehall Jewelers Holdings,
Inc. -- http://www.whitehalljewellers.com/-- through its
subsidiary, Whitehall Jewelers, Inc., operates as a specialty
retailer of fine jewelry in the United States. It offers a
selection of merchandise, including diamonds, gold, precious and
semi-precious jewelry, and watches. As of June 23, 2008, it
operated 373 stores in regional and super-regional shopping malls
under the names Whitehall and Lundstrom.
The company and Whitehall Jewelers, Inc., filed for Chapter 11
relief on June 23, 2008 (Bankr. D. Del. Lead Case No. 08-11261).
James E. O'Neill, Esq., and Laura Davis Jones, Esq., at Pachulski,
Stang Ziehl & Jones, LLP; Scott Rutsky, Esq., Peter Antoszyk,
Esq., Adam T. Berkowitz, Esq., and Jesse I. Redlener, Esq., at
Proskauer Rose LLP, represent the Debtors in their restructuring
efforts. Epiq Bankruptcy Solutions LLC is their claims, noticing
and balloting agent.
In its schedules, Whitehall Jewelers, Inc. listed total assets of
$246,571,775 and total debts of $173,694,918.
WINNET COMMUNICATIONS: Files for Chapter 11 Protection
------------------------------------------------------
Business First of Louisville reports that WinNet Communications
Inc. has filed for Chapter 11 bankruptcy protection in the U.S.
Bankruptcy Court for the Western District of Kentucky.
WinNet Communications listed $500,001 to $1 million in debts and
$0 to $50,000 in assets, says WinNet Communications. According to
the report, WinNet Communications said it has 100 to 199
creditors. Court documents say that it owes:
-- its largest creditor, AT&T, and the company's various
subsidiaries about $225,000; and
-- L&N Federal Credit Union about $41,420.81.
Louisville, Kentucky-based WinNet Communications Inc. is the
parent company of Internet service provider Win.Net --
http://www.win.net,which serves customers in Louisville, Central
Kentucky, and Southern Indiana.
* FTI Acquires Turnaround Management Services Firm CXO LLC
----------------------------------------------------------
FTI Consulting, Inc., has acquired substantially all of the assets
of CXO, L.L.C., an interim and turnaround management services
firm. Terms of the transaction were not disclosed.
Based in Dallas, Texas and led by principals Michael Katzenstein,
Brian Kushner and Stephen Dube, CXO specializes in bankruptcy
debtor advisory, interim management, crisis management, turnaround
consulting, operational due diligence, creditor advisory, and
financial/operational restructuring. CXO provides a complete
range of consulting, management, and advisory services to
companies in crisis or seeking to improve performance in specific
financial or operational areas. The firm has extensive experience
serving clients in service, manufacturing and technology
businesses, with a particular focus on the Telecom, Cable and
Media sectors. CXO will bring 12 senior level personnel, all of
whom have served in interim management executive positions, and
will join the Communications & Media practice within the Corporate
Finance/Restructuring segment of FTI.
Jack Dunn, President and CEO of FTI, commented: "We are very
pleased to welcome the outstanding professionals of CXO into our
company. The professionals of CXO are the right fit at the right
time for FTI. They are market leaders that are well known for the
turn-around and interim management services they provide to
challenged companies. They will bring additional senior expertise
to our restructuring practice, which has once again been ranked as
the clear leader in the industry at a time when demand for our
services continues to rise. They enhance our capabilities in
interim management and build on our domain expertise in the
Communications & Media sector, which is currently facing
structural and cyclical challenges in today's economic
environment. Most importantly, we have worked extensively in the
past with their well-respected professionals, so we expect a
seamless transition into our company."
"FTI now has the largest specialized team of professionals focused
on the Communications & Media industries among any of the
restructuring or turnaround firms," said Carlyn Taylor, FTI's
Communications & Media leader, "and we are extremely pleased to
have CXO join us and enhance our team to over 45 people."
Michael Katzenstein of CXO, said: "We are delighted to be joining
FTI, a global leader in the marketplace. As part of FTI, we will
be able to leverage our senior professionals through FTI's scale,
global network and resources, providing us with additional
opportunities for growth that we would not have had otherwise."
As part of the transaction CXO's key principals, Mike Katzenstein,
Brian Kushner and Stephen Dube have joined FTI as Senior Managing
Directors. In addition, Chad Coben, Seth Davis, Bob Gary, John
Debus, and Glenn Tobias have joined the company as Managing
Directors.
About FTI Consulting
Based in West Palm Beach, Florida, FTI Consulting, Inc., is a
global business advisory firm dedicated to helping organizations
protect and enhance enterprise value in an increasingly complex
legal, regulatory and economic environment. With more than 3,000
employees located in most major business centers in the world, FTI
works closely with clients every day to anticipate, illuminate,
and overcome complex business challenges in areas such as
investigations, litigation, mergers and acquisitions, regulatory
issues, reputation management and restructuring. On the Net:
http://www.fticonsulting.com/
* Manufacturing Sector Fails to Grow for 5th Straight Month
-----------------------------------------------------------
Economic activity in the manufacturing sector failed to grow in
December for the fifth consecutive month, and the overall economy
contracted for the third consecutive month, say the nation's
supply executives in the latest Manufacturing ISM Report On
Business(R).
The report was issued Jan. 2 by Norbert J. Ore, C.P.M., chair of
the Institute for Supply Management(TM) Manufacturing Business
Survey Committee. "Manufacturing activity continued to decline at
a rapid rate during the month of December. The decline covers the
full breadth of manufacturing industries, as none of the
industries in the sector report growth at this time. New orders
have contracted for 13 consecutive months, and are at the lowest
level on record going back to January 1948. Order backlogs have
fallen to the lowest level since ISM began tracking the Backlog of
Orders Index in January 1993. Manufacturers are reducing
inventories and shutting down capacity to offset the slower rate
of activity."
In December, none of the manufacturing industries reported growth.
The industries reporting contraction in December - listed in order
- are: Nonmetallic Mineral Products; Wood Products; Fabricated
Metal Products; Printing & Related Support Activities; Textile
Mills; Plastics & Rubber Products; Paper Products; Transportation
Equipment; Machinery; Primary Metals; Electrical Equipment,
Appliances & Components; Chemical Products; Computer & Electronic
Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco
Products; and Furniture & Related Products. Two industries
reported no change in activity compared to last month: Apparel,
Leather & Allied Products; and Petroleum & Coal Products.
Manufacturing contracted in December as the PMI registered 32.4%
percent, 3.8 percentage points lower than the 36.2 percent
reported in November. This is the lowest reading since June 1980
when the PMI registered 30.3 percent. A reading above 50 percent
indicates that the manufacturing economy is generally expanding;
below 50 percent indicates that it is generally contracting.
A PMI in excess of 41.1 percent, over a period of time, generally
indicates an expansion of the overall economy. Therefore, the PMI
indicates contraction in both the overall economy and the
manufacturing sector. Ore stated, "The past relationship between
the PMI and the overall economy indicates that the average PMI for
January through December (45.6 percent) corresponds to a 1.4
percent increase in real gross domestic product (GDP). In
addition, if the PMI for December (32.4 percent) is annualized, it
corresponds to a 2.7 percent decrease in real GDP annually."
* Non-manufacturing Sector Contracts in December
------------------------------------------------
Economic activity in the non-manufacturing sector contracted in
December, say the nation's purchasing and supply executives in the
latest Non-Manufacturing ISM Report On Business(R).
The report was issued today by Anthony Nieves, C.P.M., CFPM, chair
of the Institute for Supply Management(TM)Non-Manufacturing
Business Survey Committee; and senior vice president - supply
management for Hilton Hotels Corporation. "The NMI (Non-
Manufacturing Index) registered 40.6 percent in December, 3.3
percentage points higher than the 37.3 percent registered in
November, indicating contraction in the non-manufacturing sector
for the third consecutive month, but at a slightly slower rate.
The Non-Manufacturing Business Activity Index increased 6.6
percentage points to 39.6 percent. The New Orders Index increased
4.5 percentage points to 39.9 percent, and the Employment Index
increased 3.4 percentage points to 34.7 percent. The Prices Index
decreased 0.6 percentage point to 36 percent in December,
indicating a decrease in prices from November. This is the lowest
level for the index since it was first reported in 1997.
According to the NMI, one non-manufacturing industry reported
growth in December. Respondents' comments reflect concern about
the overall decline in business, lack of funding, budget cuts and
lower employment."
The one industry reporting growth in December based on the new NMI
composite index is Retail Trade. The 17 industries reporting
contraction in December -- listed in order -- are: Wholesale
Trade; Professional, Scientific & Technical Services; Mining;
Utilities; Transportation & Warehousing; Educational Services;
Agriculture, Forestry, Fishing & Hunting; Other Services; Arts,
Entertainment & Recreation; Management of Companies & Support
Services; Public Administration; Finance & Insurance;
Accommodation & Food Services; Construction; Real Estate, Rental &
Leasing; Health Care & Social Assistance; and Information.
ISM's Non-Manufacturing Business Activity Index in December
registered 39.6%, an increase of 6.6 percentage points when
compared to the 33 percent registered in November. One industry
reported increased business activity, and 13 industries reported
decreased activity for the month of December. Four industries
reported no change from November. Comments from respondents
include: "Slowdown in general"; "Less disposable income"; and
"People eating out less, grocery shopping more."
The industry reporting growth of business activity in December is
Retail Trade. The industries reporting decreased business activity
in December are: Professional, Scientific & Technical Services;
Wholesale Trade; Educational Services; Mining; Other Services;
Utilities; Transportation & Warehousing; Public Administration;
Arts, Entertainment & Recreation; Health Care & Social Assistance;
Accommodation & Food Services; Information; and Finance &
Insurance.
* Treasury Sends Report on TARP Use; Possible $4BB for GM in Feb.
-----------------------------------------------------------------
The U.S. Treasury says that in response to the current financial
crisis, it has acted quickly and creatively to implement several
programs under the $700-billion Troubled Asset Relief Program.
A copy of the Treasury's congressional report on the TARP for the
period Dec. 1 to 31, 2008 is available for free at:
http://researcharchives.com/t/s?376b
$177.5B Sent to for Financial Institutions
In December 2008, the Treasury continued to make significant
investments in United States financial institutions through the
Capital Purchase Program. As of December 31, 2008, Treasury has
invested $177.5 billion in United States financial institutions
through the CPP, providing support to small and large financial
institutions, as well as Community Development Financial
Institutions, in over 40 states and Puerto Rico. Treasury has
committed an additional $10 billion with a deferred settlement
date.
"These investments have improved the capitalization of these
institutions, which is essential to improving the flow of credit
to businesses and consumers and boosting the confidence of
depositors, investors, and counterparties alike. With higher
capital levels and restored confidence, banks can continue to play
their vital role as lenders in our communities, a necessary
requisite for economic recovery and a return to prosperity."
The Associated Press notes that the U.S. government has provided
$15 billion to seven banks from its $700 billion rescue fund. The
AP notes that the biggest payment was PNC Financial Services Group
Inc., which totaled about $7.58 billion.
Add'l $4-Bil. Loan to GM in February
In December, the Treasury also moved swiftly and thoughtfully to
support auto makers and auto financing companies through the newly
established Automotive Industry Financing Program (AIFP).
On December 29, Treasury agreed to loan up to $1 billion to
General Motors to assist the company in supporting the
reorganization as a bank holding company of GMAC LLC, a financing
company that supports GM. The Treasury also invested $5 billion
directly in GMAC pursuant to its reorganization as a bank holding
company. On Dec. 31, Treasury loaned an additional $4 billion to
GM and committed to an additional loan of $5.4 billion in January
2009, with an additional loan of $4 billion possible in February.
"Under each of these arrangements, the company has agreed to
rigorous restrictions on executive privileges and compensation and
other terms designed to protect the taxpayer. These steps will
facilitate the restructuring of the domestic auto industry and
prevent disorderly bankruptcies during a time of economic
difficulty."
Date Institution Transaction Amount
---- ----------- ------------ ------
12/29/08 GMAC LLC Pref. Stock w/ Warrants $5.0 Billion
12/29/08 General Motors Debt Obligation $1.0 Billion
12/31/08 General Motors Debt Oblig. w/ Warrants $9.4 Billion
$20-Bil. Investment in Citigroup
The Treasury also said it made a significant investment in
Citigroup on December 31, 2008, purchasing $20 billion in
preferred stock and warrants. Treasury announced its plans to
make this investment in November 2008. The investment is part of
a new Targeted Investment Program (TIP), which is designed to
preserve confidence in financial institutions and foster financial
market stability, thereby strengthening the economy, protecting
American jobs, savings, and retirement security.
Treasury will consider financial institutions for participation in
the TIP on a case-by-case basis, based on criteria in the TIP
program guidelines.
Asset Guarantee Program
Not Widely Available
In addition to making these investments, the Treasury transmitted
a report to Congress on an insurance program, known as the Asset
Guarantee Program, as required by section 102 of the Emergency
Economic Stabilization Act of 2008 (EESA). This program provides
guarantees for assets held by systemically significant financial
institutions that face a high risk of losing market confidence due
in large part to a portfolio of distressed or illiquid assets.
This program will be applied with extreme discretion in order to
improve market confidence in the systemically significant
institution and in financial markets broadly. Treasury does not
anticipate making the program widely available.
At the same time that TARP programs are being designed and
executed, Treasury is continuing to build the Office of Financial
Stability, focusing on hiring a highly-qualified staff,
implementing a comprehensive process for monitoring contractors,
and establishing a strong compliance program. Treasury also has
robust controls in place to ensure that the use of TARP funds
under section 115 of the EESA does not exceed the current limit of
$350 billion.
The Treasury said it has made significant progress since the TARP
was launched in October, and many challenges lie ahead. We will
continue to remain vigilant, ready to respond and to manage
unpredictable events as they occur, with economic recovery as the
first priority.
Firms Tapped for TARP
The Treasury sought the services of various firms in connection
with the implementation of the TARP:
Date
Approved
or Renewed Transaction Vendor Purpose
---------- ----------- ----- --------
10/10/2008 BPA Simpson, Thacher & Bartlett Legal Services
10/11/2008 BPA EnnisKnupp Investment and
Advisory Svcs.
10/14/2008 Fin'l Agent Bank of New York Mellon Custodian and
Cash Mangement
10/16/2008 BPA PricewaterhouseCoopers Internal Control
Services
10/18/2008 BPA Ernst & Young Accounting Svcs.
10/23/2008 IAA GSA - Turner Consulting Archiving Svcs.
10/29/2008 BPA Hughes Hubbard & Reed Legal Services
10/29/2008 BPA Squire Sanders & Dempsey Legal Services
10/31/2008 Contract Lindholm & Associates* Human Resources
Services
11/7/2008 BPA Thacher Proffitt & Wood Legal Services
12/3/2008 IAA Trade & Tax Bureau - Treas IT Services
12/10/2008 BPA Thacher Proffitt & Wood Legal Services
12/18/2008 BPA Kirkland and Ellis, LLP Legal Services
Private-Sector Initiatives
Meanwhile, in response to recent initiatives to further enhance
liquidity in the U.S. Treasury market, Acting Assistant Secretary
for Financial Markets Karthik Ramanathan, said Treasury supports
private-sector initiatives, such as the measures announced by the
Treasury Markets Practice Group this week, to further enhance the
depth and liquidity of the United States Treasury market.
"We commend the TMPG members for their efforts as well as those of
the Securities Industry and Financial Markets Association and the
Depository Trust and Clearing Corporation in working to implement
these protocols in a timely manner.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Jan. 21-22, 2009
TURNAROUND MANAGEMENT ASSOCIATION
Corporate Governance Meetings
Bellagio, Las Vegas, Nevada
Contact: www.turnaround.org
Jan. 22-23, 2009
TURNAROUND MANAGEMENT ASSOCIATION
Distressed Investing Conference
Bellagio, Las Vegas, Nevada
Contact: www.turnaround.org
Jan. 22-24, 2009
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Westin Tabor Center, Denver, Colorado
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 5-7, 2009
AMERICAN BANKRUPTCY INSTITUTE
Caribbean Insolvency Symposium
Westin Casurina, Grand Cayman Island, AL
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 25-27, 2009
AMERICAN BANKRUPTCY INSTITUTE
Valcon
Four Seasons, Las Vegas, Nevada
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 13, 2009
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Battleground West
Beverly Wilshire, Beverly Hills, California
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 14-16, 2009
AMERICAN BANKRUPTCY INSTITUTE
Conrad Duberstein Moot Court Competition
St. John's University School of Law, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 1-4, 2009
AMERICAN BANKRUPTCY INSTITUTE
27th Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 16-19, 2009
COMMERICAL LAW LEAGUE OF AMERICA
2009 Chicago/Spring Meeting
Westin Hotel on Michigan Ave., Chicago, Ill.
Contact: (312) 781-2000; http://www.clla.org/
Apr. 17-18, 2009
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
NABT Spring Seminar
The Peabody, Orlando, Florida
Contact: http://www.nabt.com/
Apr. 20, 2009
AMERICAN BANKRUPTCY INSTITUTE
Consumer Bankruptcy Conference
John Adams Courthouse, Boston, Massachusetts
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 27-28, 2009
TURNAROUND MANAGEMENT ASSOCIATION
Corporate Governance Meetings
Intercontinental Hotel, Chicago, Illinois
Contact: www.turnaround.org
Apr. 28-30, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Intercontinental Hotel, Chicago, Illinois
Contact: www.turnaround.org
May 1, 2009
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners
Alexander Hamilton Custom House, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
May 4, 2009
AMERICAN BANKRUPTCY INSTITUTE
New York City Bankruptcy Conference
New York Marriott Marquis, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
May 7-8, 2009
RENASSANCE AMERICAN MANAGEMENT, INC.
6th Annual Conference on
Distressted Investing - Europe
The Le Meridien Piccadilly Hotel, London, U.K.
Contact: 1-903-595-3800 or
http://www.renaissanceamerican.com/
May 7-10, 2009
AMERICAN BANKRUPTCY INSTITUTE
27th Annual Spring Meeting
Gaylord National Resort & Convention Center
National Harbor, Maryland
Contact: http://www.abiworld.org/
May 12-15, 2009
AMERICAN BANKRUPTCY INSTITUTE
Litigation Skills Symposium
Tulane University, New Orleans, La.
Contact: http://www.abiworld.org/
May 14-16, 2009
ALI-ABA
Chapter 11 Business Reorganizations
Langham Hotel, Boston, Massachusetts
Contact: http://www.ali-aba.org
June 11-14, 2009
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa
Traverse City, Michigan
Contact: http://www.abiworld.org/
June 21-24, 2009
INTERNATIONAL ASSOCIATION OF RESTRUCTURING, INSOLVENCY &
BANKRUPTCY PROFESSIONALS
8th International World Congress
TBA
Contact: http://www.insol.org/
July 16-19, 2009
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Mt. Washington Inn
Bretton Woods, New Hampshire
Contact: http://www.abiworld.org/
July 29-Aug. 1, 2009
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Conference
The Westin Hilton Head Island Resort & Spa,
Hilton Head Island, S.C.
Contact: http://www.abiworld.org/
Aug. 6-8, 2009
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Conference
Hotel Hershey, Hershey, Pa.
Contact: http://www.abiworld.org/
Sept. 10-11, 2009
AMERICAN BANKRUPTCY INSTITUTE
Complex Financial Restructuring Program
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Sept. 10-12, 2009
AMERICAN BANKRUPTCY INSTITUTE
17th Annual Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Oct. 2, 2009
AMERICAN BANKRUPTCY INSTITUTE
ABI/GULC "Views from the Bench"
Georgetown University Law Center, Washington, D.C.
Contact: http://www.abiworld.org/
Oct. 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
Oct. 20, 2009
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Paris Las Vegas, Las Vegas, Nev.
Contact: http://www.abiworld.org/
Dec. 3-5, 2009
AMERICAN BANKRUPTCY INSTITUTE
21st Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 29-May 2, 2010
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 17-20, 2010
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 7-10, 2010
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Ocean Edge Resort, Brewster, Massachusetts
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2010
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Conference
The Ritz-Carlton Amelia Island, Amelia, Fla.
Contact: http://www.abiworld.org/
Aug. 5-7, 2010
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
Dec. 2-4, 2010
AMERICAN BANKRUPTCY INSTITUTE
22nd Annual Winter Leadership Conference
Camelback Inn, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 31-Apr. 3, 2011
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 9-12, 2011
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa
Traverse City, Michigan
Contact: http://www.abiworld.org/
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
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. Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa,
Luke Caballos, Sheryl Joy P. Olano, Carlo Fernandez, Christopher
G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2009. 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 ***