/raid1/www/Hosts/bankrupt/TCR_Public/101126.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, November 26, 2010, Vol. 14, No. 328
Headlines
3 G PROPERTIES: Southern Community Bank's Foreclosure Bid Denied
335 HOSPITALITY: Case Summary & 2 Largest Unsecured Creditors
407 EAST: Case Summary & 2 Largest Unsecured Creditors
A ONE MANAGEMENT: No Basis for Revoking Confirmed Plan
ABBEY LOCKSMITH: Case Summary & 20 Largest Unsecured Creditors
ABINGDON ORTHOPEDICS: Involuntary Chapter 11 Case Summary
ACCENTIA BIOPHARMACEUTICALS: Has Emerged from Chapter 11
AK STEEL: S&P Changes Outlook to Negative, Affirms 'BB' Rating
ALVA WATSON: Case Summary & 20 Largest Unsecured Creditors
AMERICAN INT'L: Pays $161.5MM to Swap 4.9MM Shares for Corp. Units
AMERICAN MEDIA: Moody's Assigns 'B3' Corporate Family Rating
AMERICANWEST BANCORP: Gets Short Extension for $2-Mil. Loan
AMERITYRE CORP: Posts $303,000 Net Loss in September 30 Quarter
ANTHONY HOLGUIN: Case Summary & 7 Largest Unsecured Creditors
ARVINMERITOR INC: Board Promotes Treasurer to Controller
ARVINMERITOR INC: Inks 5-Year $10-Mil. Credit Deal With Citicorp
AURORA OIL: Mich. Oil & Gas Pacts Treated As Unexpired Leases
BERRY PLASTICS: Issues $800 Million in Second Lien Notes Due 2021
BLUEKNIGHT ENERGY: Charlesbank Consummates Change of Control
BONDS.COM GROUP: Posts $1.78-Mil. Net Loss in Sept. 30 Quarter
BTC CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
CABLEVISION SYSTEMS: Board Allows Survey of Rainbow Media Spin-Off
CAPRIUS INC: Hikes Vintage Securities Deal to $5 Million
CARIS DIAGNOSTICS: S&P Downgrades Corporate Credit Rating to 'B'
CATHOLIC CHURCH: Wilm. Gets Nod Add'l $12.9MM from Pooled Accounts
CATHOLIC CHURCH: Wilm. Panel Wants to Retain Schnader for Suit
CATHOLIC CHURCH: Wilm. Removal Period Extended Until January 26
CATHOLIC CHURCH: Wilmington Facing Objections to Plan Outline
CC MEDIA: Nets $5-Mil. from Sale of 706,000 Shares to Pittman
CCM MERGER: Moody's Downgrades Corporate Family Rating to 'Caa2'
CHARLENE RODGERS: Case Summary & 20 Largest Unsecured Creditors
CHEMTURA CORP: Reaches Deal to Cut St. Charles Claim to $550K
CHRISTIAN MESSNER: Case Summary & 7 Largest Unsecured Creditors
CICERO INC: Posts $1.1 Million Net Loss in September 30 Quarter
CLEAN DIESEL: Posts $1.5 Million Net Loss in September 30 Quarter
CLEAR CHANNEL: Broadcasting Amends Contract With CEO John Hogan
COOPERAGE FOREST: Case Summary & 7 Largest Unsecured Creditors
CUSTOM FOOD: Suit vs. Tipper Tie Reopened Over Service Error
DEBUT BROADCASTING: Posts $100,326 Net Income in Sept. 30 Quarter
DELPHI CORP: Asks Court to Resolve Remaining Cure Objections
DELPHI CORP: BP Microsystems Opposes Plea for Amended Complaints
DELPHI CORP: Committees Reach Deal on Trust Amendments
DIAMOND RANCH: Swings to $107,900 Net Profit in Sept. 30 Quarter
DISCOVERY LABS: Restates 10-K to Reflect Warrants Reclassification
DMCT LLC: Hearing on Substantial Asset Sale Set for Dec. 2
DYNEGY INC: Fitch Junks Issuer Default Rating From 'B-'
EARTHBOUND HOLDING: Moody's Assigns 'B2' Corporate Family Rating
EDMUND ANDERSON: Case Summary & 10 Largest Unsecured Creditors
EMPIRE RESORTS: Stockholder Lends $35-Mil. for Debt Refinancing
ESSAR STEEL: S&P Puts 'B-' Rating on CreditWatch Negative
EVANS CONVENIENCE: Case Summary & 4 Largest Unsecured Creditors
FIRST BANCORP: Fitch Downgrades Issuer Default Rating to 'CC'
FONTAINEBLEAU LV: $13.9 Mil. in Claims Changed Hands in September
FONTAINEBLEAU LV: $323 Million in Claims Changed Hands in August
FONTAINEBLEAU LV: Ch. 7 Trustee Takes Appeal of MDL Final Judgment
FORD MOTOR: Conversion Offers Reduce Debt by $1.9 Billion
FORD MOTOR: Financing Arm to Redeem NYSE-Listed Notes
FORD MOTOR: Reduces Stake in Mazda Motor to 3.5%
FRED LEIGHTON: Esmerian, Charged with Fraud, Released on Bail
GARIBALDI'S, INC.: Case Summary & 20 Largest Unsecured Creditors
GENERAL MOTORS: Asbestos Panel Wants Discovery to Estimate Claims
GENERAL MOTORS: Old GM Plan Outline Hearing Rescheduled to Dec. 2
GENERAL MOTORS: New GM IPO Proceeds Add $11.7 Bil. to TARP Funds
GENERAL MOTORS: New GM Raises $20.1 Billion From IPO
GENERAL MOTORS: Saudi Prince Pledges $500 Mil. in IPO
GENERAL MOTORS: Seeks Estimation of Asbestos Claim Liability
GEOS COMMUNICATIONS: Posts $2.6 Million Net Loss in Q3 2010
GOODYEAR TIRE: S&P Gives Stable Outlook, Affirms 'BB-' Rating
GREEN PLANET: Posts $2.9 Million Net Loss in September 30 Quarter
GROUP 1: S&P Raises Corporate Credit Rating to 'BB-'
GSC GROUP: Lenders Fight $235-Mil. Sale to Black Diamond
GURNEY'S INN: Benjamin Suit Dismissed for Improper Venue
HARLAN LABORATORIES: S&P Downgrades Corporate Credit Rating to 'B'
HEATHER CREEK: Case Summary & 20 Largest Unsecured Creditors
IA GLOBAL: Lowers Net Loss to $20,943 in Fiscal Q2
J CREW: S&P Downgrades Corporate Credit Rating to 'BB-'
JACKSON HEWITT: Refund Anticipation Loan Document Now Due Dec. 17
JERSON ALVAREZ: Case Summary & 11 Largest Unsecured Creditors
JAMES WALLACE, JR: Bank's Payment Demand Forced Ch. 11 Filing
JOHNNY NGUYEN: Case Summary & 20 Largest Unsecured Creditors
JONES SODA: Posts $5 Million Net Loss in Quarter Ended Sept. 30
KOPPERS INC: S&P Raises Corporate Credit Rating to 'BB-'
LAND VENTURES: Alabama Court Won't Void Pittman Judgment
LASER EYE: In Chapter 11; To Close by End of November
LDK SOLAR: Has Exchange Offer to Avoid 2011 Repurchase Obligation
LIONS GATE: Icahn Asks for Dismissal of Lawsuit
LOCAL INSIGHT: Gets Interim OK to Incur $7.5MM DIP Financing
LODGENET INTERACTIVE: PAR Investment Manager Joins Board
LONGYEAR PROPERTIES: Can Sell Unit D-102 to Hampers for $1.95-Mil.
LPATH INC: Closes $4.9 Million Equity Financing
MACK-CALI REALTY: Fitch Affirms Preferred Stock Rating at 'BB+'
MANGIA PIZZA: Financial Woes Prompt Chapter 11 Filing
MARTIN CADILLAC: Taps Storch, Miller for Causes of Action
MAVERICK ENGINEERING: Case Summary & Creditors List
MESA AIR: BofA Transfers Claims to Embraer Units
METROPOLITAN 885: Court OKs Garden City as Claims & Noticing Agent
METROPOLITAN 885: Taps Blank Rome as Bankruptcy Counsel
MF GLOBAL: Fitch Keeps BB+ Preferred Stock Rating on Watch Neg.
MICHAEL F COX: Case Summary & 20 Largest Unsecured Creditors
MICHAEL WAYNE COX: Case Summary & 20 Largest Unsecured Creditors
MICHAELS STORES: Incurs $12 Million Net Loss for October 31 Qtr.
MIGHTY FORTRESS: Case Summary & 8 Largest Unsecured Creditors
MMM HOLDINGS: Moody's Assigns 'B1' Rating on Senior Secured Debt
MOHEGAN TRIBAL: S&P Junks Issuer Credit Rating From 'B'
MXENERGY HOLDINGS: Amends Certificate of Incorporation
NAI ENTERTAINMENT: Moody's Assigns 'B1' Corporate Family Rating
NASSER NASSER: Voluntary Chapter 11 Case Summary
NATIONAL AMUSEMENTS: S&P Assigns 'B+' Corporate Credit Rating
NORTEL NETWORKS: To Seek OK to Enforce Price on VoIP Asset Sale
NPS PHARMACEUTICALS: Former Eli Lilly VP Added to Board
NYC OFF-TRACK: Creditor Wants Competitive Bidding for Unit
OTTAWA BUS: Voluntary Chapter 11 Case Summary
OXFORD INDUSTRIES: Oxford Apparel Sale Won't Move Moody's Rating
PARAMOUNT RESOURCES: Raises $29.97-Mil. from Public Offering
PARAMOUNT RESOURCES: Moody's Gives Neg. Outlook, Keeps 'B3' Rating
PATIENT SAFETY: Signs 3-Year Contract With CEO Brian Stewart
PHILOSOPHY INC: Coty-Carlyle Deal Won't Affect Moody's B2 Rating
PILOT TRAVEL: Moody's Affirms 'Ba2' Corporate Family Rating
POINT BLANK: Looks to Sell Assets at Auction for at Least $14MM
PRODIGY HEALTH: Moody's Affirms 'B2' Corporate Family Rating
RADIO ONE: S&P Raises Corporate Credit Rating to 'CCC+'
RADIO ONE: Completes Refinancing Transactions, Cures Loan Defaults
REGIONS FINANCIAL: S&P Cuts Counterparty Credit Ratings to 'BB+/B'
RENAL ADVANTAGE: Moody's Assigns 'B2' Corporate Family Rating
RH DONNELLEY: Adrian & Assoc. Claim Discharged Under Plan
RICHARD JOAQUIM: Voluntary Chapter 11 Case Summary
RITE WAY: Case Summary & 20 Largest Unsecured Creditors
ROSEAU DEVELOPMENT: Voluntary Chapter 11 Case Summary
ROSEWOOD INVESTMENTS: Case Summary & 20 Largest Unsec Creditors
RWN-158 GAY: Case Summary & 2 Largest Unsecured Creditors
RWN-235 HOLLIDAY: Case Summary & 4 Largest Unsecured Creditors
SABINE PASS: Moody's Downgrades Ratings on Senior Notes to 'B3'
SAM & REALTY: Case Summary & 10 Largest Unsecured Creditors
SCF PROPERTIES: Case Summary & 17 Largest Unsecured Creditors
SECURUS TECHNOLOGIES: Sverica Deal Won't Affect Moody's Rating
SEMGROUP LP: To Pay $775,000 to Executive as SERP Claim Settlement
SHUBH HOTELS PITTSBURGH: Wyndham Deal Okayed Despite Objection
SPUR ENTERPRISES: Case Summary & 6 Largest Unsecured Creditors
STILLWATER MINING: To Proceed With Two Mine Projects in Montana
SUSAN MCKENZIE: Case Summary & 10 Largest Unsecured Creditors
SWIFT TRANSPORTATION: Moody's Raises Corp. Family Rating to 'B3'
TC GLOBAL: Walter Schoenfeld Resigns as Director
TELKONET INC: Shareholders OK All Proposals at Annual Meeting
TEMPUS RESORTS: Wants to Use Resort Finance's Cash Collateral
TERESA DIAZ: Voluntary Chapter 11 Case Summary
TERRESTAR NETWORKS: Gets OK for Fraser Milner as Canadian Counsel
TERRESTAR NETWORKS: Gets OK for Stikeman as Canadian Counsel
TERRESTAR NETWORKS: Wins Approval for Akin Gump as Bankr. Counsel
TEXAS COMPETITIVE: Completes Issuance of $885-Mil. 2nd Lien Notes
TIERRA DEL SOL: Case Summary & Largest Unsecured Creditor
TIMBERLAKE FINANCIAL: S&P Downgrades Rating on Notes to 'BB'
TOYS 'R' US: Fitch Retains Positive Watch on 'B' Issuer Rating
TRADE SECRET: Awaiting Dismissal Ruling, Gets Add'l Exclusivity
TRANS-LUX CORPORATION: Posts $1.2 Million Net Loss in Q3 2010
TRIBUNE CO: Committee Wants to Recover $18MM From Advisors, Attys.
TRIBUNE CO: Plan Proponents Attack Each Other's Plans
TRIBUNE CO: JPM, et al., Want Contempt Order vs. Step One Lenders
TRIBUNE CO: Step One Lenders Want JPM Forced to Record Loan Trades
TRIDIMENSION ENERGY: Authorized for $32 Million Asset Sale
TYRONE HOSPITAL: Gary Fickes' Claim Has Been Discharged
UNIFRAX I: Moody's Raises Corporate Family Rating to 'B2'
UNIVERSAL BIOENERGY: Delays Filing of Form 10-Q for Sept. 30 Qtr.
US AIRWAYS: ALPA-Represented Express Pilots Form Alliance
US AIRWAYS: Pilots Protest Slow Contract Negotiations
US AIRWAYS: To Add 500 Crew Members in 2011
USG CORP: Board Approves CEO's Annual Base Salary Increase
VAQUERIA EL VERDOR: Case Summary & 5 Largest Unsecured Creditors
VERENIUM CORP: Posts $39.7-Mil. Net Income in Sept. 30 Quarter
VERTIS HOLDINGS: To Present Plan for Confirmation on Dec. 16
VERTIS HOLDINGS: Gets Temporary Approval to Incur DIP Financing
VIASPACE INC: Incurs $770,000 Net Loss in September 30 Quarter
VIEW SYSTEMS: Incurs $35,463 Net Loss in Third Quarter
VM ASC: Gets Court's Nod to Appoint Chapter 11 Trustee
WARNER MUSIC: Verdict on Shareholder Suit vs. Vivendi on Jan. 21
WASTE2ENERGY HOLDINGS: Delays Filing of Quarterly Report
WATCH CENTRAL: Voluntary Chapter 11 Case Summary
WENTWORTH ENERGY: Posts $2.94MM Net Loss in Third Quarter
WESTLAND PARCEL: Gets Court's Interim Nod to Use Cash Collateral
WESTLAND PARCEL: Taps Jeffrey S. Shinbrot as General Counsel
WESTMORELAND COAL: Unit Extends First Bank Revolver by 30 Days
WII COMPONENTS: S&P Withdraws 'B-' Corporate Credit Rating
WINDSTREAM CORP: Moody's Raises Speculative Grade Liquidity Rating
WIZZARD SOFTWARE: Posts $770,724 Net Loss in Third Quarter
WJO INC: Taps Ciardi Ciardi as Bankruptcy Counsel
XODTEC LED: Yuan-Fu Cheng Resigns as Chief Financial Officer
ZAVALA JAVIER: Case Summary & 4 Largest Unsecured Creditors
* Muni Issuers May Face Default 'Crunch,' Lehmann Says
* BOOK REVIEW: Working Together - 12 Principles for Achieving
Excellence in Managing Projects, Teams, and
Organizations
*********
3 G PROPERTIES: Southern Community Bank's Foreclosure Bid Denied
----------------------------------------------------------------
The Hon. J. Rich Leonard denies Southern Community Bank & Trust's
motion for relief from the automatic stay to exercise its rights
on 3 G Properties LLC's properties. Southern is unmistakably an
undersecured creditor. However, Judge Leonard says, the record
before the court suggests that at worst Southern's collateral will
maintain value going forward. In addition, the Debtor has the
exclusive right to propose a plan of reorganization. While a plan
has yet to be filed, the Debtor has sufficiently shown that the
property is necessary for an effective reorganization and that
such reorganization is possible within a reasonable time.
A copy of Judge Leonard's order, dated November 5, 2010, is
available at http://is.gd/hK9zxfrom Leagle.com.
Wake Forest, North Carolina-based 3 G Properties, LLC, dba
Granville Park Partners, LLC, Lake Glad Road Commercial, LLC, dba
Lake Glad Road Partners, LLC, filed for Chapter 11 bankruptcy
protection on June 14, 2010 (Bankr. E.D. N.C. Case No. 10-04763).
Gregory B. Crampton, Esq., and Kevin L. Sink, Esq., at Nicholls &
Crampton, P.A., represent the Company in its restructuring effort.
The Company estimated its assets and debts at $10 million to
$50 million as of the Petition Date.
335 HOSPITALITY: Case Summary & 2 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: 335 Hospitality, LLC
810 Wilson Dr
Lancaster, PA 17603
Bankruptcy Case No.: 10-30196
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Jean K. FitzSimon
Debtor's Counsel: Dexter K. Case, Esq.
CASE, DIGIAMBERARDINO & LUTZ, P.C.
845 North Park Road, Suite 101
Wyomissing, PA 19610
Tel: (610) 372-9900
Fax: (610) 372-5469
E-mail: dkc@cdllawoffice.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $500,001 to $1,000,000
A list of the Company's two largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/paeb10-30196.pdf
The petition was signed by Gus P. Photis, managing member.
407 EAST: Case Summary & 2 Largest Unsecured Creditors
------------------------------------------------------
Debtor: 407 East Saratoga Garage, LLC
11200 Rockville Pike, Suite 502
Rockville, MD 20852
Bankruptcy Case No.: 10-36704
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
District of Maryland (Greenbelt)
Judge: Paul Mannes
Debtor's Counsel: Bradford F. Englander, Esq.
J. Daniel Vorsteg, Esq.
WHITEFORD TAYLOR & PRESTON, L.L.P.
3190 Fairview Park, Suite 300
Falls Church, VA 22042
Tel: (703) 280-9081
Fax: (703) 280-3370
E-mail: benglander@wtplaw.com
jvorsteg@wtplaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's two largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/mdb10-36704.pdf
The petition was signed by Sidney M. Bresler, president of
Holliday Manager, Inc.
Debtor-affiliates that filed separate Chapter 11 petitions:
Entity Case No. Petition Date
------ -------- -------------
Jersey Island Owner, LLC 10-22970 06/09/10
Northbrook Development Parcel Owner, LP 10-22983 06/09/10
Westbury Owner, LLC 10-30951 09/12/10
RWN-158 Gay Street, LLC 10-36709 11/23/10
RWN-235 Holliday Street, LLC 10-36702 11/23/10
A ONE MANAGEMENT: No Basis for Revoking Confirmed Plan
------------------------------------------------------
The Hon. Joel B. Rosenthal says A One Management I, Inc., has
presented no basis for a revocation of confirmation for the
Bankruptcy Plan already confirmed. The Debtor had more than ample
time and opportunity to file a proper Disclosure Statement and a
confirmable Plan of Reorganization.
A copy of Judge Rosenthal's November 4, 2010, is available at
http://is.gd/hKcfofrom Leagle.com.
Brooklyn, New York-based A One Management I, Inc., filed for
Chapter 11 protection on Sept. 24, 2009 (Bankr. E.D.N.Y. Case No.
09-48331). M David Graubard, Esq., at Kera & Graubard, in New
York -- zaidiekgh@aol.com -- serves as counsel to the Debtor.
ABBEY LOCKSMITH: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Abbey Locksmith, Inc.
1558 2nd Avenue
New York, NY 10028-3923
Bankruptcy Case No.: 10-16292
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Sean H. Lane
Debtor's Counsel: Salvatore LaMonica, Esq.
LAMONICA HERBST & MANISCALCO
3305 Jerusalem Avenue
Wantagh, NY 11793
Tel: (516) 826-6500
Fax: (516) 826-0222
E-mail: sl@lhmlawfirm.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/nysb10-16292.pdf
The petition was signed by Leonard Geffner, president.
ABINGDON ORTHOPEDICS: Involuntary Chapter 11 Case Summary
---------------------------------------------------------
Alleged Debtor: Abingdon Orthopedics Associates, P.C.
613 Campus Drive, Suite 200
Abingdon, VA 24210
Bankruptcy Case No.: 10-72803
Involuntary Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Western District of Virginia (Roanoke)
Judge: William F. Stone, Jr.
Debtor's Counsel: Pro Se
Petitioner's Counsel: John M. Lamie, Esq.
BROWNING LAMIE & GIFFORD
P.O. Box 519
Abingdon, VA 24212-0519
Tel: (276) 628-6165
E-mail: jlamie@blglaw.us
Creditors who signed the Chapter 11 petition:
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
Bank of Marion Note $159,000
P.O. BOX 1067
MARION, VA 24354
Joint Leasing, LLC Rent $20,000
P.O. Box 807
Abingdon, VA 24212
Melvin Heiman, M.D. Wages $20,000
23019 Montego Bay Road
Abingdon, VA 24211
ACCENTIA BIOPHARMACEUTICALS: Has Emerged from Chapter 11
--------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Tampa Division, on November 2, 2010, entered its order confirming
Accentia Biopharmaceuticals, Inc., and its subsidiaries' First
Amended Joint Plan of Reorganization under Chapter 11 of the
Bankruptcy Code, which approved and confirmed the Plan, as
modified by the Confirmation Order.
In a regulatory filing Tuesday, the Debtors disclosed that they
emerged from Chapter 11 protection, and the Plan became effective,
on November 17, 2010.
Under the Plan, stockholders retained their common shares.
Effective as of the Effective Date and issued as of the
Determination Date, the Company became obligated to make cash
distributions in the amount of roughly $2.4 million to unsecured
creditors holding Class 10 claims under the Plan (the "Class 10
Plan Distributions"). The Class 10 Plan Distributions mature on
the date that is forty (40) months following the Effective Date
and the outstanding principal together with all accrued but unpaid
interest is due on such date.
Unsecured creditors holding a total of $6,681,354 in Class 10
claims elected to convert those Class 10 claims into Company
common stock (the "Class 10 Plan Distribution Shares") valued at
the average market price for the Company's common stock over the
ten trading days preceding the Effective Date, and the Company
issued 4,912,772 Class 10 Plan Distribution Shares to these Class
10 creditors at a conversion price equal to $1.36 per share.
About Accentia BioPharmaceuticals
Headquartered in Tampa, Florida, Accentia BioPharmaceuticals Inc.
(OTC QB: ABPI) -- http://www.accentia.net/-- is committed to
advancing the autoimmune disease therapy, Revimmune(TM), as a
comprehensive system of care and drug regimen designed for the
treatment of autoimmune diseases. Revimmune therapy includes an
ultra-high-dose regimen of cyclophosphamide (HiCy). Clinical
trials for Revimmune are being planned for the treatment of
multiple autoimmune indications.
Accentia holds a majority-ownership stake in Biovest
International, Inc. (OTC QB: "BVTI"), an emerging leader in the
field of active personalized immunotherapies. In collaboration
with the National Cancer Institute, Biovest has developed a
patient-specific, cancer vaccine, BiovaxID(R), with three clinical
trials completed including a Phase II study for the treatment of
mantle cell lymphoma and Phase II and Phase III studies for the
treatment of follicular non-Hodgkin's lymphoma.
Accentia BioPharmaceuticals and nine affiliates filed for
Chapter 11 protection on November 10, 2008 (Bankr. M.D. Fla. Lead
Case No. 08-17795). Charles A. Postler, Esq., and Elena P.
Ketchum, Esq., at Stichter, Riedel, Blain & Prosser, in Tampa,
Florida; and Jonathan B. Sbar, Esq., at Rocke, McLean & Sbar,
P.A., represent the Debtors as counsel. Adam H. Friedman, Esq.,
at Olshan Grundman Frome Rosenzweig, and Paul J. Battista, Esq.,
at Genovese Joblove & Battista PA, represent the official
committee of unsecured creditors as counsel. In their bankruptcy
petition, the Debtors disclosed assets of $134,919,728 and debts
of $77,627,355 as of June 30, 2008.
At September 30, 2010, Accentia BioPharmaceuticals' balance sheet
showed total assets of $5,020,410, current liabilities of
$7,201,329, liabilities subject to compromise of $142,886,695, and
Series A convertible redeemable preferred stock, $1.00 par value
of $7,528,640.
AK STEEL: S&P Changes Outlook to Negative, Affirms 'BB' Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its rating
outlook on West Chester, Ohio-based AK Steel Holding Corp. to
negative from stable. At the same time, S&P affirmed the
company's ratings, including its 'BB' corporate credit rating.
"The outlook revision reflects S&P's expectation that AK Steel's
operating results will likely worsen during the next several
quarters because of weaker-than-expected steel demand, and high
iron ore costs that the company has been unable to fully recover
in pricing," said Standard & Poor's credit analyst Marie Shmaruk.
Given S&P's assessment of the company's fair business risk
profile, S&P expects total adjusted debt to EBITDA to average
around 4x and funds from operations to total adjusted debt to
average around 20% through a cycle. With subpar operating
performance during the third quarter of 2010 and expectations for
a seasonally weak fourth quarter, in S&P's view, AK Steel is
unlikely to approach these ratios until the end of 2011 at the
earliest. Without the combination of better order entry and
pricing, the company's financial profile could deteriorate
further. However, S&P expects, based on its economists' forecast
for GDP growth of 2.5% in 2011 and around a 13% increase in light
vehicle sales for the year, that improved economic activity should
support healthier steel industry demand as 2011 progresses.
The ratings on AK Steel reflect what S&P considers to be the
company's fair business profile and significant financial risk
profile. The ratings also reflect its good market positions in a
number of higher value-added steel products, improved capital
structure, and adequate liquidity. These positive factors are
somewhat offset by its relatively small size, high cost position
as an integrated steelmaker, lack of backward integration, limited
diversity, high exposure to the automotive market, and improved
but still significant legacy costs.
ALVA WATSON: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Joint Debtors: Alva Joseph Watson
Vanessa Lynn Watson
P.O. Box 4240
Vienna, WV 26105
Bankruptcy Case No.: 10-40369
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Southern District of West Virginia (Parkersburg)
Judge: Ronald G. Pearson
Debtors' Counsel: Joseph W. Caldwell, Esq.
CALDWELL & RIFFEE
P.O. Box 4427
Charleston, WV 25364-4427
Tel: (304) 925-2100
Fax: (304) 925-2193
E-mail: joecaldwell@verizon.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $100,001 to $500,000
A list of the Joint Debtors' 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/wvsb10-40369.pdf
AMERICAN INT'L: Pays $161.5MM to Swap 4.9MM Shares for Corp. Units
------------------------------------------------------------------
American International Group, Inc., on Wednesday announced the
final results of its offer to exchange up to 74,480,000 of its
Equity Units consisting of Corporate Units for consideration per
Corporate Unit equal to 0.09867 shares of its common stock plus
$3.2702 in cash. The exchange offer expired at 11:59 p.m., New
York City time, on November 23, 2010.
AIG has been advised by Global Bondholder Services Corporation,
the information and exchange agent for the exchange offer, that
49,474,600 Corporate Units have been validly tendered and not
withdrawn as of the expiration of the exchange offer, all of which
have been accepted for exchange by AIG.
In accordance with the terms of the exchange offer, AIG will
deliver approximately 4,881,667 shares of its common stock and pay
approximately $161.8 million in cash in exchange for the tendered
and accepted Corporate Units. The consideration will be delivered
promptly by the information and exchange agent.
Following the completion of the exchange offer, a total of
28,925,400 Corporate Units will remain outstanding.
BofA Merrill Lynch, Citi, Deutsche Bank Securities, J.P. Morgan,
BNP PARIBAS, Credit Suisse, Morgan Stanley and UBS Investment Bank
are acting as dealer managers for the exchange offer. Global
Bondholder Services Corporation is acting as information and
exchange agent for the exchange offer. Information concerning the
terms of the exchange offer, including answers to questions
regarding the payment of the exchange consideration, may be
obtained by contacting BofA Merrill Lynch at 888-292-0070 (toll-
free) or 980-683-3215 (collect) or Citi at 800-558-3745 (toll-
free) or 212-723-6106 (collect).
About AIG
American International Group, Inc. -- http://www.aig.com/-- is an
international insurance organization with operations in more than
130 countries and jurisdictions. AIG companies serve commercial,
institutional and individual customers through one of the most
extensive worldwide property-casualty networks of any insurer. In
addition, AIG companies are leading providers of life insurance
and retirement services around the world. AIG common stock is
listed on the New York Stock Exchange, as well as the stock
exchanges in Ireland and Tokyo.
In September 2008, AIG experienced a liquidity crunch when its
credit ratings were downgraded below "AA" levels by Standard &
Poor's, Moody's Investors Service and Fitch Ratings. AIG almost
collapsed under the weight of bad bets it made insuring mortgage-
backed securities. The Company, however, was bailed out by the
Federal Reserve, but even after an initial infusion of
$85 billion, losses continued to grow. The later rescue packages
brought the total to $182 billion, making it the biggest federal
bailout in U.S. history.
AIG has been working to protect and enhance the value of its key
businesses, execute an orderly asset disposition plan, and
position itself for the future. AIG has sold a number of its
subsidiaries and other assets to pay down loans received from the
U.S. government, and continues to seek buyers of its assets.
AMERICAN MEDIA: Moody's Assigns 'B3' Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service assigned a B3 Corporate Family Rating,
B3 Probability of Default Rating, and instrument ratings in
connection with American Media Operations, Inc.'s proposed Chapter
11 exit financing, as detailed below. The proposed exit financing
will reduce funded debt by an estimated 40% to $525 million
through conversion of existing 14% senior subordinated notes and 8
7/8% senior subordinated notes into common stock. In addition,
existing 9% senior PIK notes could be be converted into a portion
of the new second lien notes. The company plans to utilize net
proceeds and a portion of cash balances to repay existing bank
debt facilities as well as to fund transaction fees and related
expenses.
Assignments:
Issuer: American Media Operations, Inc
-- Corporate Family Rating, Assigned B3
-- Probability of Default Rating, Assigned B3
-- New First Lien Senior Secured Notes, Assigned a B2, LGD3 -
40%
-- New 2nd lien, Senior Secured Notes, Assigned a Caa2, LGD5 -
89%
-- Speculative Grade Liquidity Rating, Assigned SGL-3
Outlook Actions:
Issuer: American Media Operations, Inc
-- Outlook, Assigned Stable
Ratings Rationale
American Media filed a voluntary petition for reorganization under
Chapter 11 of the U.S. Bankruptcy Code on November 17, 2010. The
company expects its plan for reorganization to become effective in
approximately 60 days. Under the plan, senior debt will be taken
out completely, with senior subordinated notes absorbing the loss.
The reorganization will significantly reduce the company's debt
and interest expense providing more financial and operating
flexibility.
Moody's ratings assume that proposed conditions are met and that
the company's debt structure after emerging from bankruptcy will
consist of an undrawn $40 million super-priority senior secured
revolver (unrated), $385 million of first lien senior secured
notes and $140 million of second lien senior secured notes. The
rating assignments are subject to a review of the final terms and
conditions of the debt instruments, and the company's liquidity
position including headroom under financial maintenance covenants.
Upon emergence from Chapter 11 and completion of the proposed new
debt issuances, American Media's B3 CFR reflects secular trends
negatively impacting circulation of weekly celebrity tabloids and
monthly magazines, the challenging market for magazine
advertising, its high 4.9x total debt-to-EBITDA leverage ratio
(including Moody's adjustments for standard items and rack
amortization), and competition from deep-pocketed rivals. After
emerging from Chapter 11, the company needs to reduce total debt-
to-EBITDA leverage ratios below the initial 4.9x level to maintain
its B3 CFR. Ratings are supported by the reputation and reader
loyalty of its flagship titles including National Enquirer, Star,
Shape, and Muscle & Fitness, improved free cash flow-to-debt
ratios due to significantly lowered cash interest expense, as well
as the ability to partially offset declining newsstand and
subscription revenues with price increases and optimizing
reductions in manufacturing and distribution costs through
strategic rate base cuts. Liquidity is adequate and enhanced by
the proposed $40 million revolver which is expected to be largely
undrawn. Although revenues are expected to be negatively impacted
by continued circulation decreases, Moody's expect credit metrics
including debt-to-EBITDA leverage and interest coverage ratios to
improve as free cash flow is applied to reduce note balances or
enhance liquidity.
The stable rating outlook reflects Moody's expectation that annual
circulation revenues will continue to decline 2-3% in the near
term and American Media will perform in line with its plan and
apply free cash flow to reduce debt balances or enhance liquidity.
Moody's also expect debt-to-EBITDA leverage ratios will remain
below 5.50x (including Moody's standard adjustments). Management
states that it is focused on increasing free cash flow and
reducing leverage. Moody's recognize that American Media's
leading celebrity magazines experienced a lower decline in
advertising page count compared to a number of its peers; however,
Moody's expect the company will continue to rely on cover price
increases to offset ongoing declines in newsstand and subscription
revenues. Also incorporated in the outlook is Moody's expectation
that the company will maintain adequate liquidity and contain
costs resulting in EBITDA margins of 25-27% over the rating
horizon.
Ratings could be upgraded if improved advertising demand,
incremental service revenue or cover price increases results in
greater free cash flow generation, further debt reduction and
debt-to-EBITDA ratios being sustained comfortably below 4.25x
(including Moody's standard adjustments). Ratings could be
lowered if higher than expected circulation declines or reduced
advertising demand deteriorates free cash flow to the point that
the company is no longer able to reduce debt balances or meet
financial maintenance covenants. Ratings could also be lowered if
acquisitions or other leveraging events result in debt-to-EBITDA
ratios that are contrary to management's plan to reduce leverage.
Moody's last rating action for American Media was on November 17,
2010 when its PDR was downgraded to D following the company's
announcement that it filed a voluntary petition for reorganization
under Chapter 11 of the U.S. Bankruptcy Code. All ratings were
subsequently withdrawn.
Headquartered in Boca Raton, Fl, American Media is a leading
publisher of celebrity journals as well as health and fitness
magazines. The company also provides publishing services to other
publishers and arranges for the placement of owned publications
and third party publications with retailers. Given continued
declines in subscription, newsstand and advertising revenues, the
company has been challenged to reduce debt balances since its
January 2009 restructuring. On November 17, 2010, American Media
filed a pre-packaged plan of reorganization under Chapter 11.
American Media is expected to emerge from Chapter 11 protection in
approximately 60 days with an estimated 40% lower debt load. The
company reported sales of approximately $404 million for the 12
months ended September 30, 2010.
AMERICANWEST BANCORP: Gets Short Extension for $2-Mil. Loan
-----------------------------------------------------------
In connection with its bankruptcy filing, AmericanWest
Bancorporation entered into a $2 million Superpriority Debtor-in-
Possession Credit Agreement, dated October 28, 2010, between the
Company, as borrower, and SKBHC Hawks Nest Acquisition Corp., as
lender.
The DIP financing requires a quick sale of all of the issued and
outstanding shares of common stock of the Debtor's wholly-owned
subsidiary, AmericanWest Bank.
AmericanWest has received approval from the Bankruptcy Court to
conduct an auction where SKBHC Hawks Nest Acquisition Corp. would
start the bidding. The Bankruptcy Court will consider the sale of
the assets to SKBHC or the winning bidder at a hearing on December
9 at 1:30 p.m. (prevailing Pacific Time). Objections, if any, are
due five days prior to the sale hearing.
On November 17, 2010, the Borrower and the Lender entered into
Amendment No. 1 to the DIP Credit Agreement. Amendment No. 1
provides, among other changes, for the extension of the maturity
date of the debtor-in-possession financing facility from
December 12, 2010, to December 13, 2010, with such maturity date
remaining subject to extension to December 27, 2010, upon written
request by the Borrower and satisfaction of certain conditions.
Amendment No. 1 also extends the period in which the Lender is
committed to provide a loan to the Borrower from November 15,
2010, to November 22, 2010. The Lender's commitment to lend to
the Borrower remains subject to the satisfaction of certain
conditions, including, among other things, receipt of all
necessary governmental authorizations.
On November 18, 2010, the Bankruptcy Court approved an order
authorizing the DIP Financing Facility, as amended pursuant to
Amendment No. 1 thereto.
SKBHC, a private investor led by banking professionals, and an
affiliated entity, has signed an Asset Purchase Agreement with
AmericanWest to acquire all of the common stock of the Bank for a
cash payment of $6.5 million, subject to a competitive bidding
process. Absent higher and better bids, the agreement calls for
SKBHC to recapitalize the Bank with additional capital of up to
$200 million as required to satisfy the capital requirements
imposed by the Bank's federal and state regulators.
About AmericanWest Bancorporation
Headquartered in Spokane, Washington, AmericanWest Bancorporation
(OTC BB: AWBC) -- http://www.awbank.net/-- is a bank holding
company whose principal subsidiary is AmericanWest Bank, which
includes Far West Bank in Utah operating as an integrated division
of AmericanWest Bank. AmericanWest Bank is a community bank with
58 financial centers located in Washington, Northern Idaho and
Utah.
AmericanWest Bancorporation filed for Chapter 11 protection on
Oct. 28, 2010 (Bankr. E.D. Wash. Case No. 10-06097). The banking
subsidiary was not including in the Chapter 11 filing.
Christopher M. Alston, Esq., and Dillon E. Jackson, Esq., at
Foster Pepper Shefelman PLLC, in Seattle, Washington, serve as
bankruptcy counsel. G. Larry Engel, Esq., at Morrison & Foerster
LLP, also serve as counsel.
The Debtor estimated assets of $1 million to $10 million and debts
of $10 million to $50 million in its Chapter 11 petition.
AmericanWest Bancorporation's estimates exclude its banking unit's
assets and debts. In its latest Form 10-Q filed with the
Securities and Exchange Commission, AmericanWest Bancorporation
reported consolidated assets -- including its bank unit's -- of
$1.536 billion and consolidated debts of $1.538 billion as of
Sept. 30, 2010.
AMERITYRE CORP: Posts $303,000 Net Loss in September 30 Quarter
---------------------------------------------------------------
Amerityre Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $303,013 on 917,646 of revenue for the
three months ended September 30, 2010, compared with a net loss of
$280,056 on $1.14 million of revenue for the three months ended
September 30, 2009.
The Company has historically incurred significant losses which
have resulted in a total retained deficit of $56.35 million at
September 30, 2010.
The Company's balance sheet at September 30, 2010, showed
$3.23 million in total assets, $1.48 million in total liabilities,
and stockholders' equity of $1.75 million.
As reported in the Troubled Company Reporter on October 4, 2010,
HJ & Associates, LLC, in Salt Lake City, Utah, expressed
substantial doubt about the Company's ability to continue as a
going concern, following the Company's results for the fiscal year
ended June 30, 2010. The independent auditors noted that the
Company has suffered recurring losses from operations that have
resulted in an accumulated deficit.
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?6f9d
About Amerityre Corporation
Boulder City, Nev.-based Amerityre Corporation (OTC BB: AMTY.OB) -
- http://www.amerityre.com/-- is engaged in the research and
development of technologies related to the formulation of
polyurethane compounds and the manufacturing process for producing
tires from polyurethane.
ANTHONY HOLGUIN: Case Summary & 7 Largest Unsecured Creditors
-------------------------------------------------------------
Joint Debtors: Anthony Holguin
Sylvia Holguin
6512 Sapphire Street
Alta Loma, CA 91701
Bankruptcy Case No.: 10-47995
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Central District Of California (Riverside)
Judge: Deborah J. Saltzman
Debtor's Counsel: Thomas P. Giordano, Esq.
LAW OFFICE OF THOMAS P. GIORDANO
18101 Von Karman Ave., Suite 560
Irvine, CA 92612
Tel: (714) 912-7810
Fax: (714) 912-7860
E-mail: tohmahso@aol.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Joint Debtors' seven largest unsecured
creditors filed together with the petition is available for
free at http://bankrupt.com/misc/cacb10-47995.pdf
ARVINMERITOR INC: Board Promotes Treasurer to Controller
--------------------------------------------------------
ArvinMeritor Inc. announced on November 18, 2010 that its Board of
Directors appointed Kevin Nowlan as Controller, which is the
principal accounting officer of ArvinMeritor, effective
December 16, 2010. In connection with his appointment as
controller, Mr. Nowlan will receive a 5% increase in his annual
base salary.
Mr. Nowlan was Treasurer of ArvinMeritor from July 2009 until
his appointment as Controller and from 2008 to 2009 served as
Assistant Treasurer and from 2007 to 2008 served as vice president
of Shared Services of ArvinMeritor. Prior to that, he was
director of Capital Planning for General Motors Acceptance Corp.
from 2006 to 2007 and worked in various roles at GMAC and General
Motors Company since 1995.
In view of the appointment of Mr. Nowlan as Controller, the Board
of Directors appointed Mary Lehmann, formerly Senior Vice
President, Strategic Initiatives, as Senior Vice President,
Treasury and Corporate Development effective December 16, 2010.
About ArvinMeritor
Based in Troy, Michigan, ArvinMeritor, Inc. --
http://www.arvinmeritor.com/-- supplies integrated systems,
modules and components to the motor vehicle industry. The Company
celebrated its centennial anniversary in 2009. The Company serves
commercial truck, trailer and specialty original equipment
manufacturers and certain aftermarkets, and light vehicle
manufacturers.
The Company's balance sheet at Sept. 30, 2010, showed
$2.87 billion in total assets, $1.39 billion in total current
liabilities, $1.029 billion in long-term debt, $1.16 billion in
retirement benefits, $321 million in other liabilities, and a
stockholders' deficit of $1.054 billion. Stockholders' deficit
was $909.0 million at June 30, 2010.
ArvinMeritor has 'B3' corporate family and probability of default
ratings from Moody's Investors Service. In July 2010, when
Moody's raised the ratings to 'B3' from 'Caa1', it noted that
about 52% of the company's fiscal 2010 revenues to date are from
North America, where demand is expected to strengthen in the
second half of the year. But with 21% of the Company's revenue
from Europe, a slower pace of economic recovery is expected to
constrain overall growth. Tight credit markets also may limit
near-term growth in commercial vehicle purchases, Moody's said.
ARVINMERITOR INC: Inks 5-Year $10-Mil. Credit Deal With Citicorp
----------------------------------------------------------------
On November 18, 2010, ArvinMeritor Inc. entered into (i) a five-
year Credit Agreement with Citicorp USA, Inc., as administrative
agent and issuing bank, the other lenders party thereto and the
Bank of New York Mellon, as paying agent and (ii) a Continuing
Agreement for Standby Letters of Credit with Citibank, N.A.
Under the terms of Credit Agreement and the LC Agreement, the
Company has the right to obtain the issuance, renewal, extension
and increase of letters of credit up to an aggregate availability
of $10 million. The Credit Facility contains covenants and events
of default generally similar to those existing in ArvinMeritor's
public debt indentures.
A full-text copy of the Credit Agreement is available for free
at http://ResearchArchives.com/t/s?6fb0
A full-text copy of the LC Agreement is available for free
At http://researcharchives.com/t/s?6fc2
About ArvinMeritor
Based in Troy, Michigan, ArvinMeritor, Inc. --
http://www.arvinmeritor.com/-- supplies integrated systems,
modules and components to the motor vehicle industry. The Company
celebrated its centennial anniversary in 2009. The Company serves
commercial truck, trailer and specialty original equipment
manufacturers and certain aftermarkets, and light vehicle
manufacturers.
The Company's balance sheet at Sept. 30, 2010, showed
$2.87 billion in total assets, $1.39 billion in total current
liabilities, $1.029 billion in long-term debt, $1.16 billion in
retirement benefits, $321 million in other liabilities, and a
stockholders' deficit of $1.054 billion. Stockholders' deficit
was $909.0 million at June 30, 2010.
ArvinMeritor has 'B3' corporate family and probability of default
ratings from Moody's Investors Service. In July 2010, when
Moody's raised the ratings to 'B3' from 'Caa1', it noted that
about 52% of the company's fiscal 2010 revenues to date are from
North America, where demand is expected to strengthen in the
second half of the year. But with 21% of the Company's revenue
from Europe, a slower pace of economic recovery is expected to
constrain overall growth. Tight credit markets also may limit
near-term growth in commercial vehicle purchases, Moody's said.
AURORA OIL: Mich. Oil & Gas Pacts Treated As Unexpired Leases
-------------------------------------------------------------
Under Michigan law, WestLaw reports, oil and gas agreements
executed prepetition by a Chapter 11 debtor and an energy company
constituted unexpired "leases" within the meaning of the
Bankruptcy Code. The agreements recited that prior to their
execution, the company was the owner of a subsurface mineral
estate. The agreements plainly granted the debtor exclusive
possession and control for a defined period of time, namely, the
initial term and thereafter so long as oil and gas were produced
in "paying quantities." The company conveyed an interest to the
debtor in exchange for consideration in the form of rents and
royalty payments, which were akin to "rents and profits" in the
parlance of the common law. At the termination of the agreements
the interests conveyed to the debtor reverted to the company. In
sum, the property interests transferred under the agreements were
not interests in oil and gas per se, but merely the right to
extract oil and gas from the company's reversionary estate, which,
under Michigan law, was an interest in the real estate, though
less than a fee interest. In re Aurora Oil & Gas Corp., --- B.R.
----, 2010 WL 4642698 (Bankr. W.D. Mich.) (Dales, J.).
A copy of the Honorable Scott W. Dales' summary judgment decision
in Frontier Energy, LLC v. Aurora Energy, Ltd., Adv. Pro. No. 09-
80518 (W.D. Mich.), is available at:
http://www.miwb.uscourts.gov/Opinions/pdfs/098010653552[1].pdf
About Aurora Oil & Gas
Based in Traverse City, Michigan, Aurora Oil & Gas Corporation
(Pink Sheets: AOGS) is an independent energy company focused on
unconventional natural gas exploration, acquisition, development
and production, with its primary operations in the Antrim Shale of
Michigan, the New Albany Shale of Indiana and Kentucky.
The Company and one affiliate sought Chapter 11 protection (Bankr.
W.D. Mich. Case Nos. 09-08254 and 09-08255) on July 12, 2009.
Stephen B. Grow, Esq., at Warner Norcross & Judd, LLP, in Grand
Rapids, Mich., and Joel H. Levitin, Esq., and Richard A.
Stieglitz, Jr., at Cahill Gordon & Reindel LLP in New York City,
serve as the Debtors' counsel. Aurora estimated its assets and
debts at $100 million to $500 million at the time of the filing.
The Bankruptcy Court confirmed a chapter 11 plan paying less than
10 cents-on-the-dollar to unsecured creditors in Dec. 2009.
BERRY PLASTICS: Issues $800 Million in Second Lien Notes Due 2021
-----------------------------------------------------------------
Berry Plastics Corporation, an Apollo Management, L.P. and Graham
Partners portfolio company, issued $800,000,000 in aggregate
principal amount of 9.75% Second Priority Senior Secured Notes due
2021, which mature on January 15, 2021, pursuant to an indenture,
dated as of November 19, 2010, by and among Berry, the guarantors
named therein, and U.S. Bank National Association, as trustee.
In addition, pursuant to its previously announced tender offers
and consent solicitations, Berry received tenders and consents
from the holders of:
i) $502,719,000 aggregate principal amount, or approximately
95.76%, of its 8 7/8% Second Priority Senior Secured Fixed
Rate Notes due 2014 issued under an indenture dated as of
September 20, 2006, and
ii) $247,638,000 aggregate principal amount, or approximately
99.06%, of its 8 7/8% Second Priority Senior Secured Notes
due 2014 issued under an indenture dated as of November
12, 2009 by the expiration of the consent payment
deadline, November 18, 2010 at 5:00 p.m., New York City
time.
The consents received exceeded the number needed to approve the
proposed amendments to each indenture under which the Notes were
issued. The complete terms and conditions of the tender offers
and consent solicitations for the Notes are detailed in Berry's
Offer to Purchase and Consent Solicitation Statement dated
November 4, 2010 and the related Consent and Letter of
Transmittal.
Berry has elected to exercise its right to accept for early
payment all the 2006 Notes and the 2009 Notes validly tendered
prior to the Consent Date. Each holder who validly tendered its
Notes and delivered consents to the Proposed Amendments prior to
the Consent Date will receive the total consideration of:
1) $1,047.50 per $1,000 principal amount of 2006 Notes or
2009 Notes tendered, which includes $1,017.50 as the
tender offer consideration, and
2) $30.00 as a consent payment.
In addition, Berry will pay accrued interest up to, but not
including, the date of payment on all for validly tendered Notes
accepted for early payment.
Under the terms of the tender offers, Berry and the trustee under
each Indenture have entered into supplemental indentures that
effect the Proposed Amendments to each Indenture governing each
series of the Notes. The Proposed Amendments eliminate
substantially all of the material restrictive covenants, eliminate
or modify certain events of default and eliminate or modify
related provisions in the Indentures governing the Notes. The
supplemental indentures became effective upon Berry's acceptance
of a majority in principal amount of the applicable series of
Notes for payment under the early acceptance terms in the tender
offers.
Notwithstanding Berry's exercise of its early acceptance rights,
each tender offer will remain open until 12:00 midnight, New York
City time, on December 3, 2010, unless extended or earlier
terminated. Because the Consent Date has passed, tendered Notes
may no longer be withdrawn and consents may no longer be revoked
at any time, except to the extent that Berry is required by law to
provide additional withdrawal rights. Holders who validly tender
their Notes and deliver their consents after the Consent Date and
prior to the Expiration Date will receive only the tender offer
consideration and will not be entitled to receive a consent
payment if such Notes are accepted for purchase pursuant to the
tender offers. In addition, as disclosed in the Tender Offer
Documents, Berry intends to redeem any of the 2006 Notes and 2009
Notes that remain outstanding after the completion of the tender
offers in accordance with the terms of the applicable Indenture.
On November 19, 2010, Berry provided notice to the trustee under
each indenture of such redemptions and irrevocably deposited cash
with the trustee in respect of such notes in an amount sufficient
to redeem any notes outstanding on such redemption date.
All the conditions set forth in the Tender Offer Documents remain
unchanged. If any of the conditions are not satisfied, Berry may
terminate the tender offers and return tendered Notes that have
not already been accepted for payment. Berry has the right to
waive any of the foregoing conditions with respect to the Notes
of any or all series and to consummate any or all of the tender
offers and the consent solicitations. In addition, Berry has the
right, in its sole discretion, to terminate the tender offers
andor the consent solicitations at any time, subject to applicable
law.
About Berry Plastics
Berry Plastics Corporation manufactures and markets plastic
packaging products, plastic film products, specialty adhesives and
coated products. At January 2, 2010 the Company had more than 80
production and manufacturing facilities, primarily located in the
United States. Berry is a wholly-owned subsidiary of Berry
Plastics Group, Inc. Berry Group is primarily owned by affiliates
of Apollo Management, L.P. and Graham Partners. Berry, through
its wholly owned subsidiaries operates five reporting segments:
Rigid Open Top, Rigid Closed Top, Flexible Films, Tapes/Coatings
and Specialty Films. The Company's customers are located
principally throughout the United States, without significant
concentration in any one region or with any one customer.
On December 3, 2009, Berry Plastics obtained control of 100% of
the capital stock of Pliant upon Pliant's emergence from
reorganization pursuant to a proceeding under Chapter 11 for a
purchase price of $602.7 million. Pliant is a leading
manufacturer of value-added films and flexible packaging for food,
personal care, medical, agricultural and industrial applications.
The acquired business is primarily operated in Berry's Specialty
Films reporting segment.
The Company's balance sheet at July 3, 2010, showed $5.71 billion
in total assets, $5.44 billion in total liabilities, and
$268.5 million in stockholders' equity.
* * *
Berry Plastics has a 'B3' corporate family rating, with stable
outlook, from Moody's Investors Service. Moody's said in April
2010 that Berry's B3 CFR reflects weakness in certain credit
metrics, financial aggressiveness and acquisitiveness and a
continued difficult operating and competitive environment
especially in the flexible plastics and tapes segments. The
rating also reflects the Company's exposure to more cyclical end
markets, relatively weak contracts with customers and a high
percentage of commodity products.
Standard & Poor's Ratings Services said that it assigned a debt
rating of 'CCC' (two notches below the 'B-' corporate credit
rating) and a recovery rating of '6' to Berry Plastic Corp.'s
proposed offering of $800 million second-priority senior secured
notes due 2020. These ratings indicate S&P's expectation of
negligible (0%-10%) recovery in the event of a payment default.
BLUEKNIGHT ENERGY: Charlesbank Consummates Change of Control
------------------------------------------------------------
According to a filing with the Securities and Exchange Commission,
as contemplated by a Global Transaction Agreement entered into on
October 25, 2010, by and among Blueknight Energy Partners, L.P.
(the "Partnership"), Blueknight Energy Partners G.P., L.L.C., the
general partner of the Partnership (the "General Partner"),
Blueknight Energy Holding, Inc. ("Vitol Holding") and CB-
Blueknight, LLC ("Charlesbank Holding"), on November 12, 2010, the
General Partner purchased 433,758 General Partner Units in the
Partnership to maintain the General Partner's approximate 2%
general partner interest in the Partnership in exchange for
aggregate consideration of approximately $2.8 million. The
General Partner Units were issued and sold in a private
transaction exempt from registration under Section 4(2) of the
Securities Act of 1933, as amended, and certain rules and
regulations promulgated under that section.
Changes in Control
As previously announced, Vitol Holding and Charlesbank Holding
entered into an agreement whereby Charlesbank Holding would
purchase 50% of the membership interests in the entity that
controls the General Partner and 50% of the Partnership's
outstanding subordinated units representing limited partner
interests in the Partnership from Vitol Holding. The Partnership
has been informed that the transactions contemplated by the Vitol-
Charlesbank Agreement were consummated on November 12, 2010 (the
"Change of Control"). Charlesbank Holding is owned indirectly by
Charlesbank Capital Partners, LLC. Vitol Holding is indirectly
owned by Vitol Holding B.V. ("Vitol") and continues to own 50% of
the membership interests in the entity that controls the General
Partner and own 50% of the Subordinated Units.
Departure of Officers
In connection with the Change of Control, Messrs. Michael R.
Eisenson and Jon M. Biotti, both of whom are affiliated with
Charlesbank, were appointed to the Board of Directors of the
General Partner on November 12, 2010. In addition, on such date,
Messrs. Javed Ahmed and Christopher G. Brown resigned from the
Board. As such, the Board now consists of two directors, Messrs.
Eisenson and Biotti, who are affiliated with Charlesbank, two
directors, Messrs. Miguel A. ("Mike") Loya and James C. Dyer, IV,
who are affiliated with Vitol, and three independent directors,
Messrs. Duke R. Ligon, Steven M. Bradshaw and John A. Shapiro.
Mr. Eisenson is a Managing Director and Chief Executive Officer of
Charlesbank, which is a Boston-based private equity firm. Prior
to co-founding Charlesbank in 1998, Mr. Eisenson was the president
of Harvard Private Capital Group. He began his tenure at Harvard
Management Company in 1986 as managing director. Before joining
Harvard Management Company, Mr. Eisenson was with The Boston
Consulting Group, a corporate strategy consulting firm. Mr.
Eisenson serves on the board of directors of Animal Health
International and several privately held Charlesbank portfolio
companies. Mr. Eisenson was also a board member of Regency Gas
Services, representing Charlesbank which was Regency's founding
equity investor. He is a graduate of Williams College, with a
Bachelors degree in economics, and holds an MBA and a Juris
Doctorate degree from Yale University.
Mr. Biotti is a Managing Director of Charlesbank, which he joined
in 1998 after graduating from Harvard Business School where he was
an entrepreneurial studies fellow. Mr. Biotti also worked as a
banking associate at Brown Brother Harriman. Mr. Biotti serves on
the board of directors of several privately held Charlesbank
portfolio companies, including Southcross Energy, LLC. Mr. Biotti
was also a board member of Regency Gas Services, representing
Charlesbank which was Regency's founding equity investor.
Educated at Harvard, Mr. Biotti received a Bachelors degree in
government and sociology, an MBA and an MA in public
administration.
Change of Control Payments
The Change of Control resulted in a change of control under the
employment agreements of each of (i) J. Michael Cockrell,
President and Chief Operating Officer of the General Partner, (ii)
Alex G. Stallings, Chief Financial Officer and Secretary of the
General Partner, (iii) James R. Griffin, Chief Accounting Officer
of the General Partner, and (iv) Jerry A. Parsons, Executive Vice
President-Products of the General Partner.
The Change of Control resulted in a change of control under Mr.
Cockrell's employment agreement. Pursuant to such agreement,
during the period from 2010 to 2013, Mr. Cockrell is entitled to
certain deferred payments as compensation for long-term incentive
awards which he forfeited upon leaving his prior employer, which
payments total $2,080,377, and may be made in the form of cash or
equity incentives. Pursuant to the agreement, any unpaid deferred
payments were accelerated upon the Change of Control and are
payable within 10 days following such Change of Control in a lump
sum payment to Mr. Cockrell. As such, deferred payments equal to
$1,912,303 have been accelerated and are payable to Mr. Cockrell.
The Change of Control resulted in a change of control under the
employment agreements of Messrs. Stallings, Griffin and Parsons.
If within one year after the Change of Control any such officer is
terminated by the General Partner without Cause (as defined below)
or such officer terminates the agreement for Good Reason (as
defined below), he will be entitled to payment of any unpaid base
salary and vested benefits under any incentive plans, a lump sum
payment equal to 24 months of base salary and continued
participation in the General Partner's welfare benefit programs
for the longer of the remainder of the term of the employment
agreement or one year after termination. Upon such an event,
Messrs. Stallings, Griffin and Parsons would be entitled to lump
sum payments of $600,000, $420,000 and $500,000, respectively, in
addition to continued participation in the General Partner's
welfare benefit programs and the amounts of unpaid base salary and
benefits under any incentive plans.
About Blueknight Energy
Blueknight Energy Partners, L.P. (Pink Sheets: BKEP)
-- http://www.bkep.com/-- owns and operates a diversified
portfolio of complementary midstream energy assets consisting of
approximately 8.2 million barrels of crude oil storage located in
Oklahoma and Texas, approximately 6.7 million barrels of which are
located at the Cushing Oklahoma Interchange, approximately 1,300
miles of crude oil pipeline located primarily in Oklahoma and
Texas, approximately 185 crude oil transportation and oilfield
services vehicles deployed in Kansas, Colorado, New Mexico,
Oklahoma and Texas and approximately 7.2 million barrels of
combined asphalt and residual fuel storage located at 45 terminals
in 22 states. BKEP provides integrated terminalling, storage,
processing, gathering and transportation services for companies
engaged in the production, distribution and marketing of crude oil
and asphalt product. BKEP's general partner is controlled by
Vitol Holding B.V. and its affiliates, which are engaged in the
global physical supply and distribution of crude oil, petroleum
products, coal, natural gas and other commodities. BKEP is based
in Oklahoma City, Oklahoma and Tulsa, Oklahoma.
The Company's balance sheet at Sept. 30, 2010, showed
$295.96 million in total assets, $444.02 million in current
liabilities, $4.69 million in long-term payable to related
parties, and a partners' deficit of $152.75 million.
* * *
PricewaterhouseCoopers LLP, in Tulsa, Okla., in its report on the
Partnership's financial statements for the year ended December 31,
2009, expressed substantial doubt about its ability to continue as
a going concern. The independent auditors noted that the
Partnership has substantial long-term debt, a deficit in partners'
capital, and significant litigation uncertainties.
BONDS.COM GROUP: Posts $1.78-Mil. Net Loss in Sept. 30 Quarter
--------------------------------------------------------------
Bonds.com Group, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $1,781,178 for the three months ended
September 30, 2010, compared with net loss of $2,764,145 for the
same period a year ago.
The Company's balance sheet at September 30, 2010, showed
$1,565,132 in total assets, $9,823,058 in total liabilities, and a
stockholders' deficit of $8,257,925.
The Company reported revenues of $599,964 for the three months
ended September 30, 2010, compared with revenues of $959,793 for
the same period a year ago.
Since its inception, the Company has generated limited revenues
and has incurred a cumulative net loss of $23,619,174. As of
September 30, 2010, the Company has a working capital deficit of
$5,796,898, including approximately $1,050,000 and $82,000 of
outstanding notes payable to related parties and other,
respectively, and $22,153 of outstanding convertible notes payable
due within the next twelve months. Management commenced
operations in December of 2007 utilizing additional capital raised
throughout the years ended December 31, 2009, 2008 and 2007.
Operations during the year ended December 31, 2009, and the nine
months ended September 30, 2010, have also been funded using
proceeds received from the issuance of convertible notes to
related and unrelated parties, secured promissory notes to related
and unrelated parties and the issuance of common stock. If the
Company does not obtain additional capital in the near term, its
ability to continue to implement its business plan may be limited.
The Company faces a liquidity crisis. Historically, the Company
has satisfied its funding needs primarily through equity and debt
financings, and it needs to raise additional funding promptly or
it risks a cessation or interruption in its business. As of
November 9, 2010, the Company had cash on hand and liquid deposits
with clearing organizations in the total amount of approximately
$1.2 million which includes the proceeds from the recent
financings. The Company intends to use the majority of these
funds for working capital purposes. Management anticipates that
its current liquidity, along with cash generated from revenues,
will be sufficient for sustaining its operating activities only
until approximately the end of December 2010. While the Company
is actively negotiating for additional equity investments by
existing and new investors, there is no assurance that it will be
successful in raising additional capital. If the Company is
unable to raise sufficient capital in the very near term, it may
experience an interruption or cessation of its business and may be
forced to seek reorganization or liquidation under U.S. bankruptcy
laws. For these reasons and others, there is substantial doubt
about the Company's ability to continue as a going concern.
The Company is actively pursuing additional equity capital from
existing and new investors. These potential investors have
discussed potential terms of their investments which include,
among other things, a valuation of the Company that would
significantly dilute the ownership stake of existing stockholders
and result in such investors potentially owning at least a
majority of the Company's Common Stock. The final terms of any
investment -- including the valuation of the Company -- have not
been determined. Nevertheless, it appears that the Company will
not be able to raise additional equity capital, if at all, except
at a valuation that will be significantly dilutive to existing
investors. Dilution to existing stockholders pursuant to any
equity financing will be exacerbated as a result of the
anticipated lower price per share triggering full-ratchet
antidilution protection of certain outstanding convertible
securities, unless the Company obtains waivers.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?6fbf
About Bonds.com Group
Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG)
-- http://www.bonds.com/-- through its subsidiary Bonds.com,
Inc., serves institutional fixed income investors by providing a
comprehensive zero subscription fee online trading platform. The
Company designed the BondStation and BondStationPro platforms to
provide liquidity and competitive pricing to the fragmented Over-
The-Counter (OTC) Fixed Income marketplace.
The Company differentiates itself by offering through Bonds.com,
Inc. an inventory of over 35,000 fixed income securities from more
than 175 competing sources. Asset classes currently offered on
BondStation and BondStationPro, the Company's fixed income trading
platforms, include municipal bonds, corporate bonds, agency bonds,
certificates of deposit, emerging market debt, structured products
and U.S. Treasuries.
BTC CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: BTC Construction Company
fdba Barger Tanner Construction
1647 Malllory Lane, #200
Brentwood, TN 37027
Bankruptcy Case No.: 10-12852
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Middle District of Tennessee (Nashville)
Judge: Marian F. Harrison
Debtor's Counsel: Steven L. Lefkovitz, Esq.
LAW OFFICES LEFKOVITZ & LEFKOVITZ
618 Church Street, Suite 410
Nashville, TN 37219
Tel: (615) 256-8300
Fax: (615) 255-4516
E-mail: slefkovitz@lefkovitz.com
Scheduled Assets: $2,138,433
Scheduled Debts: $1,529,604
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/tnmb10-12852.pdf
The petition was signed by Russell W. Barger, president.
CABLEVISION SYSTEMS: Board Allows Survey of Rainbow Media Spin-Off
------------------------------------------------------------------
Cablevision Systems Corporation's board of directors has
authorized management to explore a potential leveraged spin-off of
its Rainbow Media Holdings LLC business to Cablevision's
stockholders, which would be structured as a tax-free pro rata
distribution to stockholders.
In addition, the Board has approved filing the necessary documents
with the Internal Revenue Service to seek a private letter ruling
with respect to the transaction's tax-free status.
Cablevision said it is confident of the strength of the Rainbow
business, which houses an attractive portfolio of programming
assets, and believes that the spin-off has the potential to
enhance the value of that business and Cablevision, thereby
providing each company with greater flexibility to pursue
strategic objectives. If the transaction moves forward, it is
anticipated that a new, public Rainbow company would include:
* National programming networks: AMC, WE tv, IFC, Sundance
Channel and Wedding Central;
* IFC Entertainment, an independent film business that consists
of multiple brands -- including IFC Films, IFC Productions and
the IFC Center -- devoted to bringing the best of specialty
films to a large audience; and
* Rainbow Network Communications (RNC), a full service network
programming origination and distribution company, supplying an
array of services to the cable, satellite and broadcast
industries.
Businesses that are expected to remain a part of Cablevision,
should the Rainbow spin-off occur, include the cable and
telecommunications business, Newsday, News 12 Networks, MSG
Varsity and Clearview Cinemas.
The company would target mid-year 2011 for completion of the
proposed spin-off, which is subject to a number of factors,
including receipt of a private letter ruling from the IRS and
approval by the board of directors. Cablevision notes that there
can be no assurance that a transaction will be consummated.
The company is not considering the sale of Rainbow or its cable
and telecommunications business.
* * *
As reported in the Troubled Company Reporter on November 10, 2010,
Rainbow National Services LLC and its subsidiaries has $1.337
billion in assets, $1.831 billion in debts and a member's
deficiency of $493.951 million at Sept. 30, 2010.
Rainbow National Services reported net income of $39.4 million on
$228.16 million of net revenue for three months ended Sept. 30,
2010, compared with net income of $41.50 million on
About Cablevision Systems
Headquartered in Bethpage, New York, Cablevision Systems
Corporation is predominantly a domestic cable TV multiple system
operator serving around 3.1 million subscribers in and around the
New York metropolitan area. Among other entertainment-and media-
related business ventures, the company also owns and distributes
programming to cable television and direct broadcast satellite
providers throughout the United States through its Rainbow
National Services subsidiary.
The Company's balance sheet at June 30, 2010, showed $7.63 billion
in total assets, $13.81 billion in total liabilities, and
a stockholders' deficit $6.19 billion.
Cablevision carries a 'Ba2' long term corporate family rating from
Moody's and 'BB' issuer credit ratings from Standard & Poor's.
Moody's Investors Service said in November 2010 that Cablevision's
Ba2 Corporate Family Rating and SGL1 rating, along with ratings of
company's subsidiaries including CSC Holdings, LLC and Newsday,
LLC, will not be affected by the potential leveraged spin-off of
Rainbow Media Holdings, LLC to the firm's shareholders. At this
time the impact to Rainbow National Services, LLC's (Rainbow) Ba2
CFR and SGL1 ratings are uncertain, pending the proposed structure
of the debt financing and impact on leverage.
CAPRIUS INC: Hikes Vintage Securities Deal to $5 Million
--------------------------------------------------------
As of November 18, 2010, Caprius, Inc. and its subsidiaries
entered into Amendment No. 3 to the Securities Purchase and Sale
Agreement, dated as of September 16, 2009 with Vintage Capital
Group, LLC, whereby the maximum availability thereunder was
increased up to $5.0 million. There were no other material
changes to the terms of Securities Purchase and Sale Agreement,
dated September 16, 2009 as amended in Amendment No. 1 dated
September 8, 2010 and Amendment No. 2 dated November 4, 2010.
Vintage had advanced approximately $4.5 million in cash to the
Company, exclusive of amounts related to capitalized obligations.
The Company will use the proceeds of the funding under the
Amendment for working capital, production and further marketing of
the SteriMed Systems, as well as the settlement of certain
outstanding obligations.
A full-text copy of the Purchase And Sale Agreement is available
for free at http://ResearchArchives.com/t/s?6fb6
About Caprius, Inc.
Paramus, N.Y.-based Caprius, Inc., is engaged in the infectious
medical waste disposal business, through its wholly-owned
subsidiary M.C.M. Environmental Technologies, Inc., which
developed, markets and sells the SteriMed and SteriMed Junior
compact systems that simultaneously shred and chemically disinfect
regulated medical waste, utilizing its proprietary, EPA
registered, bio-degradable chemical known as Ster-Cid.
The Company's balance sheet at June 30, 2010, showed $1.66 million
in total assets, $5.87 million in total liabilities, and a
$4.22 million stockholders' deficit.
* * *
Marcum LLP, in New York City, expressed substantial doubt about
the Company's ability to continue as a going concern after
auditing the Company's financial results for fiscal 2009. The
independent auditors noted of the Company's working capital
deficiency and substantial recurring losses from operations.
CARIS DIAGNOSTICS: S&P Downgrades Corporate Credit Rating to 'B'
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
corporate credit rating on Irving, Texas-based Caris Diagnostics
to 'B' from 'B+'. At the same time, S&P lowered the issue-level
rating on the company's senior secured bank credit facility to 'B'
from 'B+'. The recovery rating remains unchanged at '3'. S&P
also placed the corporate credit rating on CreditWatch with
negative implications.
The downgrade on Caris reflects tighter liquidity associated with
weaker than expected earnings in its hematology business together
with a covenant stepdown at Sept. 30, 2010. S&P believes there is
less than 10% cushion under the company's total leverage covenant
and there are additional covenant step-downs at Dec. 31, 2010 and
March 31, 2011. Those additional step-downs could result in a
possible breach of the leverage covenant in the absence of any
remedy or earnings improvement.
The company's leverage, for bank covenant compliance purposes, was
3.23x at Sept. 30, 2010. This leverage is relatively low,
especially for the rating category. Given this relatively low
leverage, and the fact that all of the debt is under a first-lien
senior secured credit facility, S&P believes that the company has
a reasonable chance of obtaining relief to provide more cushion.
The speculative-grade rating on Caris reflects the company's
narrow operating focus, early-stage status, relatively small
scale, potential for reimbursement pressure, and the near-term
risks associated with its large expansion projects.
S&P will resolve the CreditWatch once S&P has a better
understanding of the company's progress in coping with the
increasing liquidity hurdles.
CATHOLIC CHURCH: Wilm. Gets Nod Add'l $12.9MM from Pooled Accounts
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Catholic Diocese of Wilmington, Inc., on a fifteenth interim
basis, to make certain withdrawals from the pooled investment
account for the benefit of the Diocese and certain pooled
investors.
Subject to the terms of the Custody Agreement, Judge Sontchi
authorized the Diocese to make withdrawals from the pooled
investment account and to process withdrawal requests of non-
debtor pooled investors without further Court order, up to these
applicable amounts:
Pooled Investor Aggregate Cap
--------------- -------------
Diocese $9,400,000
Foundation 1,450,656
Charities 407,413
Children's Home 352,741
Siena Hall 330,211
Cemeteries 302,750
Seton Villa 278,553
Corpus Christi 164,000
Holy Family 135,897
Holy Cross 50,000
Our Lady of Lourdes 40,000
Cathedral of St. Peter 25,000
Our Mother of Sorrows 23,620
St. Ann (Wilmington) 10,000
---------
Total $12,970,841
Notwithstanding any other provision of the Interim Order, the
Custodian will have no liability for, or otherwise be in violation
of the Interim Order, for acting in accordance with the Custody
Agreement or processing any withdrawal or investment requests made
by the Diocese.
Judge Sontchi also authorized the Diocese to continue to invest
and deposit funds into the pooled investment account in accordance
with its prepetition practices, without the need for a bond or
other collateral as required by Section 345(b) of the Bankruptcy
Code. The entities with which the Diocese's pooled investment
funds are deposited and invested will be excused from full
compliance with the requirements of Section 345(b) until 45 days
following the docketing of a final order directing compliance with
Section 345(b) as to specific accounts following the next hearing
on the requested relief.
Nothing contained in the Interim Order will prevent the Diocese
from establishing any additional sub-funds within the Pooled
Investment Account as it may deem necessary and appropriate, and
the Account's Custodian is authorized to process the Diocese's
request to account for transactions with respect to the sub-fund.
In the event Pooled Investment Funds or their proceeds transferred
by the Diocese to a non-debtor Pooled Investor pursuant to the
Interim Order are determined to have been property of the
bankruptcy estate at the time of transfer, the transfer will be
presumed to have been an unauthorized postpetition transfer within
the meaning of Section 549(a)(2)(B) of the Bankruptcy Code,
provided that the presumption may be rebutted by a showing that
the transfer was made in the ordinary course of business within
the meaning of Section 363(c)(1) of the Bankruptcy Code.
About the Diocese of Wilmington
The Diocese of Wilmington covers Delaware and the Eastern Shore of
Maryland and serves about 230,000 Catholics. The Delaware diocese
is the seventh Roman Catholic diocese to file for Chapter 11
protection to deal with lawsuits for sexual abuse. Previous
filings were by the dioceses in Spokane, Washington; Portland,
Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and
San Diego, California.
The bankruptcy filing automatically stayed eight consecutive abuse
trials scheduled in Delaware scheduled to begin October 19. There
are 131 cases filed against the Diocese, with 30 scheduled for
trial.
The Diocese filed for Chapter 11 on October 18, 2009 (Bankr. D.
Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Diocese. The Ramaekers
Group, LLC, is the financial advisor. The petition says assets
range $50,000,001 to $100,000,000 while debts are between
$100,000,001 to $500,000,000. (Catholic Church Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
CATHOLIC CHURCH: Wilm. Panel Wants to Retain Schnader for Suit
--------------------------------------------------------------
The Official Committee of Unsecured Creditors in the bankruptcy
case of the Catholic Diocese of Wilmington, Inc., filed a
complaint on December 18, 2009, against the Diocese and certain
non-debtor defendants, including The Diocese of Wilmington
Schools, Inc., Catholic Cemeteries, Inc., and Siena Hall, Inc.,
seeking a determination that the assets in the Diocese's Pooled
Investment Account were not held in trust and that the Defendants
should be substantively consolidated, among other relief.
The U.S. Bankruptcy Court for the District of Delaware bifurcated
the adversary case for discovery and trial. After the conclusion
of the trial on Phase I, the Court entered (i) an order partially
granting and partially denying the Creditors Committee's request
for declaratory relief, (ii) a final judgment on the matter, and
(iii) an opinion explaining the Court's ruling. Pursuant to the
Order, Final Judgment and Opinion, the Court found that funds
deposited in the PIA were property of the Diocese's bankruptcy
estate.
As a result of the Ruling, the Creditors Committee believes the
assets of the estate available for distribution to the victims of
sex abuse and the Diocese's other unsecured creditors increased by
over $100 million because the Ruling determined that approximately
$75 million of assets in the PIA were property of the estate. The
Creditors Committee also believes the Ruling makes it impossible
for the Diocese to trace the so-called restricted funds it
contends are invested in the PIA, which funds are alleged to
exceed $25 million.
The Diocese and the Non-Debtor Defendants are proceeding with a
direct appeal of the Ruling before the United States Court of
Appeals for the Third Circuit.
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware, avers that if the Defendants are successful
with their challenge to the Ruling on Appeal, then the assets
available for distribution to the victims of sex abuse and other
unsecured creditors will be reduced by approximately $100 million.
By this application, the Creditors Committee seeks the Court's
authority to retain Schnader Harrison Segal & Lewis LLP as its
special appellate counsel, nunc pro tunc to October 20, 2010, to
assist the Creditors Committee in defending the Ruling upon appeal
before the Third Circuit.
The PIA is the single largest asset of the estate by a very
substantial margin, Ms. Jones contends. The Creditors Committee
believes that preserving the Court's Ruling is critical to ensure
a fair distribution to the unsecured creditors of the estate.
The Creditors Committee believes that the input and participation
of Honorable Timothy K. Lewis, a former judge of the Third Circuit
and now serving as the co-chair of the Appellate Practice Group of
Schnader, in the preparation of the principal Appeal brief and
oral argument before the Third Circuit panel, will be invaluable.
The professional services that Schnader will render in connection
with the Appeal include assisting and advising the Creditors
Committee and its primary counsel with respect to the preparation
of the appellee brief and oral argument, and advising and
consulting with them with respect to other aspects of the Appeal.
Schnader will be paid based on its hourly rates, and reimbursed
for its actual, necessary expenses and other charges.
The firm's current hourly rates are:
Professional Rate
------------ ----
Timothy K. Lewis $850
Nancy Winkelman $625
Schnader's other members $250 to $450
Ms. Jones asserts that the Creditors Committee's counsel,
Pachulski Stang Ziehl & Jones LLP, intends to work closely with
Schnader to ensure that there is no unnecessary duplication of
services performed or charged to the estate.
Judge Lewis assures the Court neither Schnader nor any of its
partners or other attorneys represent any interest adverse to the
Diocese and parties-in-interest in the matters upon which Schnader
is to be engaged. He adds that Schnader is a "disinterested
person," within the meaning of Section 101(14) of the Bankruptcy
Code.
Objections
A. Diocese
The Diocese agrees that the Appeal is an important issue in the
bankruptcy case, but disagrees that the retention of a special
appellate counsel is necessary or appropriate, particularly given
that the Creditors Committee has, thus far, been ably represented
by Pachulski Stang in connection with the PIA litigation.
While the Diocese notes that Schnader has graciously agreed to
reduce its hourly rates in connection with the proposed
engagement, the primary attorneys on the engagement will still
cost $625 to 850 per hour, and will necessarily be brought up to
speed on by Pachulski Stang partners and of counsel, who are
charging, as they have throughout the duration of the case, 100%
of their normal rates, Robert S. Brady, Esq., at Young Conaway
Stargatt & Taylor, LLP, in Wilmington, Delaware -- rbrady@ycst.com
-- contends.
Although the Creditors Committee represents that Pachulski Stang
and Schnader will endeavor to avoid duplication of efforts, there
will inevitably be a duplication of effort bringing a new firm up
to speed on matters that Pachulski Stang litigated extensively
before the Court, Mr. Brady argues. He notes that the Diocese is
concerned about the mounting costs of the case.
The Creditors Committee has selected sophisticated, qualified
bankruptcy counsel to represent it "in connection with any
litigation, disputes or other matters that may arise in connection
with this case," which should have obviated the hiring of special
counsel to handle every substantial legal issue that manifests
itself, Mr. Brady contends. He adds that there is simply no need
to add another professional to the rolls in the case.
If the Court is inclined to grant the Application, then the
Diocese suggests that a reasonable limit be imposed upon
Schnader's aggregate compensation and expense reimbursement.
B. Employee Committee
The Official Committee of Lay Employees argues that the Creditors
Committee's Application should be denied because the employment of
Judge Lewis and Schnader is not necessary.
While Judge Lewis is a well respected former judge of the Third
Circuit, his experience in adjudicating matters before the Third
Circuit does not necessitate his employment, Donald J. Detweiler,
Esq., at Greenberg Traurig, LLP, in Wilmington, Delaware, tells
Judge Sontchi.
Mr. Detweiler contends that at least two of Pachulski Stang's
attorneys identified on the pleadings before the Court are
admitted to practice in the Third Circuit and are experienced and
qualified counsel. The two attorneys are Laura Davis Jones, Esq.,
and Ken Brown, Esq.
A brief search on the Westlaw database also reveals that Pachulski
Stang has also participated in at least 261 matters in the Third
Circuit, excluding numerous other federal and state court appeals
that the firm has presumably handled, Mr. Detweiler also asserts.
He insists that the Application fails to explain why Pachulski
Stang's experience in practicing before the Third Circuit, and its
participation and prosecution of the underlying litigation, is
insufficient to represent the interests of the bankruptcy estate.
The fact that a large sum of money is at issue does not satisfy
the "necessity" requirements of Rule 2014 of the Federal Rules of
Bankruptcy Procedure, and hence, the Application should be denied,
Mr. Detweiler argues.
If the Court is inclined to allow the Creditors Committee to
retain Schnader, then, the Employee Committee asks that the firm's
fees and expenses be capped at $50,000, and the amount be paid
from the Abuse Survivors' distribution, if any.
About the Diocese of Wilmington
The Diocese of Wilmington covers Delaware and the Eastern Shore of
Maryland and serves about 230,000 Catholics. The Delaware diocese
is the seventh Roman Catholic diocese to file for Chapter 11
protection to deal with lawsuits for sexual abuse. Previous
filings were by the dioceses in Spokane, Washington; Portland,
Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and
San Diego, California.
The bankruptcy filing automatically stayed eight consecutive abuse
trials scheduled in Delaware scheduled to begin October 19. There
are 131 cases filed against the Diocese, with 30 scheduled for
trial.
The Diocese filed for Chapter 11 on October 18, 2009 (Bankr. D.
Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Diocese. The Ramaekers
Group, LLC, is the financial advisor. The petition says assets
range $50,000,001 to $100,000,000 while debts are between
$100,000,001 to $500,000,000. (Catholic Church Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
CATHOLIC CHURCH: Wilm. Removal Period Extended Until January 26
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended to
January 26, 2011, the period within which the Catholic Diocese of
Wilmington, Inc., may remove various civil actions pending as of
the Petition Date.
About the Diocese of Wilmington
The Diocese of Wilmington covers Delaware and the Eastern Shore of
Maryland and serves about 230,000 Catholics. The Delaware diocese
is the seventh Roman Catholic diocese to file for Chapter 11
protection to deal with lawsuits for sexual abuse. Previous
filings were by the dioceses in Spokane, Washington; Portland,
Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and
San Diego, California.
The bankruptcy filing automatically stayed eight consecutive abuse
trials scheduled in Delaware scheduled to begin October 19. There
are 131 cases filed against the Diocese, with 30 scheduled for
trial.
The Diocese filed for Chapter 11 on October 18, 2009 (Bankr. D.
Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Diocese. The Ramaekers
Group, LLC, is the financial advisor. The petition says assets
range $50,000,001 to $100,000,000 while debts are between
$100,000,001 to $500,000,000. (Catholic Church Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
CATHOLIC CHURCH: Wilmington Facing Objections to Plan Outline
-------------------------------------------------------------
The Official Committee of Unsecured Creditors in the bankruptcy
case of the Catholic Diocese of Wilmington, Inc., tells the U.S.
Bankruptcy Court for the District of Delaware that the Disclosure
Statement explaining the Diocese's Plan of Reorganization does not
enable a creditor to decide whether to accept or reject the Plan.
With regard to estimating claims in order to make an early
distribution to the Diocese's affiliates, the Disclosure Statement
fails to discuss the duplicative expenses of the proposed motion
to estimate claims and it ignores the futility of the request,
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware, contends.
The Disclosure Statement also does not discuss the impact on
distributions if the Diocese wins its argument that numerous
significant assets are not property of the bankruptcy estate, Ms.
Jones asserts. She points out that in estimating the distribution
on the Personal Injury Tort Claims, the Disclosure Statement
relies on actual pay outs in selective bankruptcy cases without
explaining why those particular pay outs are relevant to potential
pay outs in the case and what are the insurance assets or
insurance proceeds available to pay creditors in those cases.
Ms. Jones also argues that the liquidation analysis in the
Disclosure Statement is inaccurate. She adds, among other things,
that the settlements with the Non-Debtor Catholic Entities are
also not fully disclosed in the Disclosure Statement.
Accordingly, the Creditors Committee asks the Court not to approve
the Disclosure Statement and find that the Plan is patently
unconfirmable on its face.
The Creditors Committee also seeks leave from the Court to file
its Objection that exceeds the 40-page limit for briefs
established under Rule 7007-2 of the Local Rules of Bankruptcy
Practice and Procedure of the United States Bankruptcy Court for
the District of Delaware. The Creditors Committee asserts that
the Objection will materially aid the Court, and parties-in-
interest, in preparing for and addressing the Creditors
Committee's concerns and objections to the Disclosure Statement
during the December 6, 2010 Disclosure Statement Hearing.
Unofficial Committee Joins Objection
Jacobs & Crumplar, P.A., and The Neuberger Firm, P.A., join in the
Creditors Committee's Objection.
The two law firms represent many unsecured creditors asserting a
personal injury claim against the Diocese.
On behalf of the Unofficial Committee of 91 State Court Abuse
Survivors, the Firms tell the Court that they also oppose any
disclosure statement or plan that does not include the contingent
value of the entire Pooled Investment Account and appraised value
of the 58 Parishes of the Diocese to ascertain the fairness of the
disclosure and proposed plan.
In addition, the inclusion of all 58 Parishes for a de minimis
contribution in contrast to their value of about $140 million,
including insurance, is against the interests of these survivors,
who have direct claims against 27 parishes, whose assets
themselves are in excess of $50 million with insurance, the Firms
assert.
Other Parties Object
Other parties also objected to the Disclosure Statement. The
objectors include the Official Committee of Lay Employees;
insurers Allianz S.p.A., Fireman's Fund Insurance Company, Granite
State Insurance Company, and Insurance Company of the State
of Pennsylvania; Wilmington Trust Company; and Susan S. Phoebus.
The Lay Employees Committee says that while it supports the
general structure of the Plan, the Plan has "several problems".
The Employee Committee insists that the Disclosure Statement has
inadequate disclosure with respect to various issues, including:
-- the proposed Third Party Releases;
-- the Liquidation Analysis; and
-- the assets that will vest in the Reorganized Debtor.
Allianz S.p.A. and Fireman's Fund, which issued certain insurance
policies to the Diocese, says the Disclosure Statement fails to
provide adequate information regarding insurance-related issues
that affect the Insurers and holders of Claims, and is materially
misleading with respect to the effects of confirmation of the Plan
on insurance coverage upon which the Diocese relies to pay Claims.
Wilmington Trust Company, the indenture trustee for holders of
variable rate revenue bonds issued by the Debtor to pay for a
$12.5 million loan from the Delaware Economic Development
Authority, says its reserves rights and those of the holders and
pledgee of the bonds regarding, inter alia, (i) all rights and
remedies of a holder or pledgee of the bonds for the receipt of
principal, interest, and other payments owing under the Indenture
or the bonds, (ii) the exclusive right to receive restricted or
pledged funds, (iii) the vesting under the Indenture of all rights
and remedies of the bond holders in the Indenture Trustee,
(iv) the exclusive right to receive distributions from the estate
on account of, among other things, the bonds, and (v) the
Indenture Trustee's right to apply distributions to its fees and
expenses in accordance with the terms of the Indenture.
In a letter addressed to the Clerk of the U.S. Bankruptcy Court
for the District of Delaware, Susan S. Phoebus asks that the
proposed Plan of Reorganization filed by the Catholic Diocese of
Wilmington, Inc., be denied. Ms. Phoebus asks that the Plan
should not be approved for these reasons:
(1) Priests are allowed to keep their full pension, but lay
employees are being paid only 44.5% of their pensions;
(2) A $3.2 million dollar "restricted" fund is being left
untouched to continue to pay priest pensions when the fund
could be used to fully pay lay employee pensions;
(3) Priests are being allowed to vote to approve the Plan when
their claims are 100% unimpaired. This dilutes the vote
of the lay employees, who are being hurt by the Plan; and
(4) The Plan is being approved before the Court has appointed
or paid for an attorney to represent the Official
Committee of Lay Employees, which means that the lay
employees' interests are not being protected.
Copies of the Amended Plan and Disclosure Statement, as well as
the blacklined portions of the Amended Plan and Disclosure
Statement, may be accessed for free at:
* http://bankrupt.com/misc/Church_W_2ndAmdPlan_110110.pdf
* http://bankrupt.com/misc/Church_W_AmendedDS_110110.pdf
* http://bankrupt.com/misc/Church_W_Plan_DS_Blined_110110.pdf
The Court will convene a hearing on December 6, 210, at
10:00 a.m., prevailing Eastern Time, to consider the adequacy of
the Disclosure Statement. Objections are due on November 22.
About the Diocese of Wilmington
The Diocese of Wilmington covers Delaware and the Eastern Shore of
Maryland and serves about 230,000 Catholics. The Delaware diocese
is the seventh Roman Catholic diocese to file for Chapter 11
protection to deal with lawsuits for sexual abuse. Previous
filings were by the dioceses in Spokane, Washington; Portland,
Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and
San Diego, California.
The bankruptcy filing automatically stayed eight consecutive abuse
trials scheduled in Delaware scheduled to begin October 19. There
are 131 cases filed against the Diocese, with 30 scheduled for
trial.
The Diocese filed for Chapter 11 on October 18, 2009 (Bankr. D.
Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Diocese. The Ramaekers
Group, LLC, is the financial advisor. The petition says assets
range $50,000,001 to $100,000,000 while debts are between
$100,000,001 to $500,000,000. (Catholic Church Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
CC MEDIA: Nets $5-Mil. from Sale of 706,000 Shares to Pittman
-------------------------------------------------------------
On November 15, 2010, CC Media Holdings Inc. issued and sold
706,215 shares of its Class A Common Stock to Pittman CC LLC, a
Delaware limited liability company, for $5,000,000 in cash,
pursuant to a Stock Purchase Agreement dated November 15, 2010 by
and among the Company, Pittman CC LLC, Clear Channel Capital IV,
LLC and Clear Channel Capital V, L.P..
About CC Media and Clear Channel
Clear Channel Communications, Inc. -- http://www.clearchannel.com/
-- is a diversified media company with three primary business
segments: radio broadcasting, outdoor advertising and live
entertainment. Clear Channel (OTCBB:CCMO) is the operating
subsidiary of San Antonio, Texas-based CC Media Holdings, Inc.
* * *
Clear Channel Carries a Caa2 corporate family rating from Moody's
Investors Service and an issuer default rating of 'CCC' from Fitch
Ratings.
Fitch said on November 22, 2010, that its ratings concerns center
on the company's highly leveraged capital structure, with
significant maturities in 2014 and 2016; the considerable interest
burden that pressures free cash flow generation; technological
threats and secular pressures in radio broadcasting; and the
company's exposure to cyclical advertising revenue. The ratings
are supported by the company's leading position in both the
outdoor and radio industries, as well as the positive fundamentals
and digital opportunities in the outdoor advertising space.
The Company's balance sheet at June 30, 2010, showed
$17.287 billion in assets, $24.496 billion in total liabilities
and a shareholders' deficit of $7.209 billion.
CCM MERGER: Moody's Downgrades Corporate Family Rating to 'Caa2'
----------------------------------------------------------------
Moody's Investors Service downgraded CCM Merger, Inc.'s Corporate
Family and Probability of Default ratings to Caa2 from Caa1. The
company's senior secured term loan and revolver were also
downgraded, to Caa1 from B3. The Caa3 rating on CCM's senior
unsecured notes due 2013 was confirmed. These actions conclude
the review for possible downgrade initiated on August 25, 2010.
The rating outlook is negative.
Ratings downgraded:
-- Corporate Family Rating to Caa2 from Caa1
-- Probability of Default Rating to Caa2 from Caa1
-- $70 million senior secured revolver expiring July 2011 to
Caa1 (LGD 3, 33%) from B3 (LGD 3, 33%)
-- $547 million senior secured term loan maturing July 2012 to
Caa1 (LGD 3, 33%) from B3 (LGD 3, 33%)
Rating confirmed:
-- $273 million senior unsecured notes due August 2013 at Caa3
(LGD 5, 87%)
Ratings Rationale
The ratings downgrade reflects Moody's view that with debt/EBITDA
continuing at 7.4 times, limited intermediate-term growth
prospects, and covenant compliance challenges, CCM could find it
difficult to obtain covenant relief, refinance its revolver
expiring July 2011, and/or refinance its July 2012 term loan
maturity without an additional equity contribution -- or in the
absence of additional equity -- some impairment to bondholders.
The company has announced that it intends to pursue a
comprehensive refinancing of its outstanding debt, and Marian
Ilitch, the company's owner, has supported the company with cash
equity contributions in the past. However, there is no formal
requirement or any form of assurance that Ms. Ilitch will
contribute additional cash equity to support the company, if
necessary.
CCM's $70 million senior secured first lien revolver expires in
less than 9 months and the company could face a liquidity event
without an extension because the company is reliant on the
revolver to back Letters of Credit. While CCM can cover its
interest payments and debt amortization, about $50 million of the
revolver acts as a backstop that secures the principal and
interest payments for CCM's $50 million Michigan Strategic Fund
bonds due 2039. If the expiration date of the revolver is not
extended, this would cause a liquidity event as CCM would have to
either repay the MSF bonds or find an alternative LOC provider.
Separately, in Moody's opinion, CCM's operating results are not
likely to improve enough in the short term to achieve covenant
compliance. If CCM is not able to obtain covenant relief, Moody's
believes the company will be out of compliance in the quarter
ended Sept. 30, 2011, when the total leverage covenant contained
in the company's bank agreement steps down significantly.
The negative ratings outlook reflects the compressed time frame in
which CCM has to address what Moody's believes to be significant
capital structure issue. An outlook revision to stable would
likely require that the company obtain longer-term covenant relief
and a significantly more relaxed debt maturity profile. A higher
rating, however, would require a capital structure that Moody's
believes is sustainable over the longer-term, with debt/EBITDA at
or below 6.5 times.
CCM Merger, Inc., indirectly owns and operates the MotorCity
Casino in Detroit, Michigan. The company generates approximately
$460 million of annual net revenue.
CHARLENE RODGERS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Charlene A. Rodgers
P.O. Box 60122
Las Vegas, NV 89160
Bankruptcy Case No.: 10-31994
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Mike K. Nakagawa
Debtor's Counsel: Steven L. Yarmy
1500 E. Tropicana Ave., Ste. 103
Las Vegas, NV 89119
Tel: (702) 586-3513
Fax: (702) 586-3690
E-mail: sly@stevenyarmylaw.com
Scheduled Assets: $623,720
Scheduled Debts: $1,886,071
A list of the Debtor's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/nvb10-31994.pdf
CHEMTURA CORP: Reaches Deal to Cut St. Charles Claim to $550K
-------------------------------------------------------------
Chemtura Corporation, et al., ask the U.S. Bankruptcy Court for
the Southern District of New York to approve a stipulation
resolving St. Charles Parish School Board's claim.
St. Charles Parish asserted that as of the Petition Date, Chemtura
owed St. Charles Parish $3,566,866 for unpaid sales and use taxes,
interest, penalties, and other charges allowed under State and
local law.
The Debtors sought to reduce the claim to $940,716 based on an
initial reconciliation of the Debtors' books and records, and
further review of the claim.
St. Charles Parish agreed, for purposes of the settlement, that
its claim against the Debtor be limited to and allowed as a
priority tax claim in the amount of $550,000 without further need
for any action by the Reorganized Debtors.
Pursuant to the stipulation, Chemtura agreed to pay the Allowed
Claim, in full, by December 31, 2010. If the $550,000 Allowed
Claim is not paid as a priority tax claim by December 31, the
Allowed Claim will be increased to $940,716, plus interest, and
said amount will be and remain binding on the parties hereto and
will be paid in full, with interest, in accordance with the terms
and conditions of the Plan on the next Distribution Date.
The Court will convene a hearing on November 29, at 12:00 p.m.
(ET), to consider approval of the stipulation. Objections, if
any, are due November 29 at 11:30 a.m.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC. As of
December 31, 2008, the Debtors had total assets of $3.06 billion
and total debts of $1.02 billion.
CHRISTIAN MESSNER: Case Summary & 7 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Christian Messner
1002 Tam Oshanter Drive
Las Vegas, NV 89101
Bankruptcy Case No.: 10-32015
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Mike K. Nakagawa
Debtor's Counsel: C. Andrew Wariner, Esq.
823 Las Vegas Blvd., Suite 500
Las Vegas, NV 89101
Tel: (702) 953-0404
Fax: (702) 989-5388
E-mail: awariner@lvbklaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's seven largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/nvb10-32015.pdf
CICERO INC: Posts $1.1 Million Net Loss in September 30 Quarter
---------------------------------------------------------------
Cicero Inc. filed its quarterly report on Form 10-Q, reporting a
net loss of $1.06 million on $565,000 of revenue for the three
months ended September 30, 2010, compared with a net loss of
$599,000 on $546,000 of revenue for the same period of 2009.
The Company's balance sheet as of September 30, 2010, showed
$5.08 million in total assets, $13.85 million in total
liabilities, and a stockholders' deficit of $8.77 million.
The Company has incurred losses of $1.28 million and $823,000 for
the years ended December 31, 2009 and 2008, respectively, and has
experienced negative cash flows from operations for each of the
past three years. For the nine months ended September 30, 2010,
the Company incurred a net loss of $2.57 million, and had a
working capital deficiency of $10.92 million as of September 30,
2010.
"The Company anticipates that it will raise additional funds in
the next several months however, there can be no assurance the
Company will be able to do so. Despite the recent additions of
several new clients, the Company continues to struggle to gain
additional sources of liquidity on terms that are acceptable to
the Company. As such, there is substantial doubt of the Company's
ability to continue as a going concern."
A full-text copy of the Form 10-Q is available for free at
http://researcharchives.com/t/s?6f9c
Cary, N.C.-based Cicero, Inc., provides business integration
software solutions and also provides technical support, training
and consulting services as part of its commitment to providing
customers with industry-leading solutions.
The Company focuses on the customer experience management market
with emphasis on desktop integration and business process
automation with its Cicero XM(TM) products. Cicero XM enables the
flow of data between different applications, regardless of the
type and source of the application, eliminating redundant entry
and costly mistakes.
CLEAN DIESEL: Posts $1.5 Million Net Loss in September 30 Quarter
-----------------------------------------------------------------
Clean Diesel Technologies, Inc., filed its quarterly report on
Form 10-Q, reporting a net loss of $1.49 million on $341,000 of
revenue for the three months ended September 30, 2010, compared
with a net loss of $1.94 million on $253,000 of revenue for the
corresponding period last year.
The Company's balance sheet at September 30, 2010, showed
$6.05 million in total assets, $1.23 million in total liabilities,
and stockholders' equity of $4.82 million.
As reported in the Troubled Company Reporter on November 25, 2010,
Clean Diesel completed the merger of its wholly owned subsidiary,
CDTI Merger Sub, Inc., with and into Catalytic Solutions, Inc., a
manufacturer and distributor of emissions control systems and
products, focused in the heavy-duty diesel and light-duty vehicle
markets, on October 15, 2010.
CSI has suffered recurring losses and negative cash flows from
operations since inception, and prior to the merger, CSI's working
capital was severely limited. As of September 30, 2010, CSI had
an accumulated deficit of roughly $152 million and a working
capital deficit of $6.3 million.
CSI's auditors' report for fiscal year 2009 included an
explanatory paragraph that expresses substantial doubt about CSI's
ability to continue as a "going concern."
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?6fa1
Clean Diesel Technologies, Inc. (Nasdaq: CDTI)
-- http://www.cdti.com/-- is, with the recent business
combination with Catalytic Solutions, Inc., a vertically
integrated global manufacturer and distributor of emissions
control systems and products, focused in the heavy duty diesel
(HDD) and light duty vehicle (LDV) markets. CDT is headquartered
in Ventura, California, along with its wholly-owned subsidiary,
CSI, and currently has operations in the U.S., Canada, U.K.,
France, Japan and Sweden as well as an Asian joint venture.
CLEAR CHANNEL: Broadcasting Amends Contract With CEO John Hogan
---------------------------------------------------------------
On November 18, 2010, Clear Channel Broadcasting Inc., an indirect
wholly-owned subsidiary of Clear Channel Communications, Inc.,
entered into an amended and restated employment agreement with
John E. Hogan, President and Chief Executive Officer, Clear
Channel Radio, which amends and restates the existing employment
agreement dated June 29, 2008 between CCB and Mr. Hogan.
Pursuant to the terms of the Amended And Restated Employment
Agreement, Mr. Hogan will (i) receive an annual base salary of
$1,000,000, (ii) be eligible to receive an annual bonus with a
bonus target equal to 120% of his base salary and (iii) be
eligible to participate in employee welfare benefit plans
consistent with other comparable positions.
About CC Media and Clear Channel
Clear Channel Communications, Inc. -- http://www.clearchannel.com/
-- is a diversified media company with three primary business
segments: radio broadcasting, outdoor advertising and live
entertainment. Clear Channel (OTCBB:CCMO) is the operating
subsidiary of San Antonio, Texas-based CC Media Holdings, Inc.
* * *
Clear Channel Carries a Caa2 corporate family rating from Moody's
Investors Service and an issuer default rating of 'CCC' from Fitch
Ratings.
Fitch said on November 22, 2010, that its ratings concerns center
on the company's highly leveraged capital structure, with
significant maturities in 2014 and 2016; the considerable interest
burden that pressures free cash flow generation; technological
threats and secular pressures in radio broadcasting; and the
company's exposure to cyclical advertising revenue. The ratings
are supported by the company's leading position in both the
outdoor and radio industries, as well as the positive fundamentals
and digital opportunities in the outdoor advertising space.
The Company's balance sheet at June 30, 2010, showed
$17.287 billion in assets, $24.496 billion in total liabilities
and a shareholders' deficit of $7.209 billion.
COOPERAGE FOREST: Case Summary & 7 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Cooperage Forest, LLC
740 Chestnut Street
Manchester, NH 03104
Bankruptcy Case No.: 10-15013
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
District of New Hampshire (Manchester)
Debtor's Counsel: William S. Gannon, Esq.
WILLIAM S. GANNON PLLC
889 Elm Street, 4th Floor
Manchester, NH 03101
Tel: (603) 621-0833
Fax: (603) 621-0830
E-mail: bgannon@gannonlawfirm.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's seven largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/nhb10-15013.pdf
The petition was signed by Romeo D. Danais, Jr., manager.
CUSTOM FOOD: Suit vs. Tipper Tie Reopened Over Service Error
------------------------------------------------------------
Judge Peter Walsh grants Tipper Tie, Inc.'s request to (i) reopen
the adversary proceeding commenced by Charles A. Stanziale, as the
liquidating trustee of Custom Food Products, Inc., and (ii) set
aside the default judgment entered in the proceeding. Judge Walsh
says the Trustee's attempt to effect service of process by sending
the Summons and Complaint to Tipper Tie's remittance address
failed to comply with Federal Rule of Bankruptcy Procedure
7004(b)(3). The remittance address was to a lockbox at Bank of
America, and Bank of America was not authorized to receive service
of process. Furthermore, the Trustee knew Tipper Tie's business
address. Without effective service of process, the Default
Judgment is void.
The case is Charles A. Stanziale, in his capacity as Liquidating
Trustee of CFP Liquidating Estate, Plaintiff, v. Tipper Tie, Inc.,
Defendant, Adv. Pro. No. 09-50478 (Bankr. D. Del.). The Trustee
sued on March 19, 2009, to recover allegedly preferential payments
made to Tipper Tie. A copy of Judge Walsh's memorandum opinion,
dated November 4, 2010, is available at http://is.gd/hKfZJfrom
Leagle.com.
Custom Food Products, Inc., was in the business of developing,
manufacturing, and marketing pre-cooked meat products to packaged
food manufacturers and national fast-food restaurant chains. CFP
filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Del.
Case No. 07-10495) on April 13, 2007. Pursuant to the court-
confirmed Joint Plan of Reorganization, Charles A. Stanziale, Jr.,
was appointed Liquidating Trustee.
DEBUT BROADCASTING: Posts $100,326 Net Income in Sept. 30 Quarter
-----------------------------------------------------------------
Debut Broadcasting Corporation, Inc., filed its quarterly report
on Form 10-Q, reporting net income of $100,326 for the three
months ended September 30, 2010, compared with net income of
$166,510 for the same period a year ago.
The Company's balance sheet at September 30, 2010, showed
$4,646,466 in total assets, $4,816,281 in total liabilities, and a
$169,816 stockholders' deficit.
The Company reported net revenue of $566,743 for the three months
ended September 30, 2010, compared with net revenue of $525,802
for the same period last year.
The continuation of Debut Broadcasting as a going concern is
dependent upon the continued financial support from its
shareholders, the ability of Debut Broadcasting to obtain
necessary equity financing to continue operations, and the
attainment of profitable operations. As of September 30, 2010,
Debut Broadcasting has accumulated losses since inception. These
factors raise substantial doubt regarding Debut Broadcasting's
ability to continue as a going concern. These financial
statements do not include any adjustments to the recoverability
and classification of recorded asset amounts and classification of
liabilities that might be necessary should Debut Broadcasting be
unable to continue as a going concern.
The Company's ability to continue as a going concern is dependent
on obtaining adequate capital to fund operating losses until it
becomes profitable. If the Company is unable to obtain adequate
capital, it could be forced to cease operations. In order to
continue as a going concern, the Company will need, among other
things, additional capital resources. The Company's plan is to
aggressively grow revenue in order to meet minimal operating
expenses and seeking equity and debt financing. However the
Company cannot provide any assurances that it will be successful
in accomplishing any of its plans.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?6fc0
About Debut Broadcasting
Debut Broadcasting Corporation, Inc. (OTC BB: DBTB) --
http://www.debutbroadcasting.com/-- is a radio broadcasting and
syndication company that produces and distributes syndicated radio
programming to radio stations in the United States and Canada.
The company maintains radio syndication in Nashville, Tenn., and
produces and distributes 15 radio programs, which are broadcasted
over approximately 1,400 radio station affiliates. It owns and
operates five broadcast radio stations, which include WIQQ FM
102.3 MHz in Leland, WBAQ FM 97.9 MHz and WNIX AM 1330 kHz in
Greenville, and WNLA FM 105.5 MHz and WNLA AM 1380 kHz in
Indianola, Miss. The company is based in Nashville, Tenn.
DELPHI CORP: Asks Court to Resolve Remaining Cure Objections
------------------------------------------------------------
DPH Holdings Inc. and its units ask the Bankruptcy Court to:
(A) overrule the objections to cure amounts under the Original
Plan of Reorganization filed by DGC-Plastic Molding Inc.,
Magneti Marelli Powertgrain, Digi-Key Corporation, and
Sanyo Electronic Device Corp.; and
(B) deny the cure proposals submitted by Georgia Power
Company, TR Butterfield Trail Corporation, and Spartech
Corporation with respect to the assumption of their
contracts under the First Amended Joint Plan of
Reorganization, as modified.
DGC-Plastic and Magneti opposed the designated $0 cure amount for
the applicable contracts to be assumed and assigned, and asserted
objections that sought to convert their general unsecured claims,
which were transferred to Liquidity Solutions, Inc., into a cure
claim. The Reorganized Debtors maintain that:
-- the amounts asserted in DGC-Plastic's Claim No. 4843 do not
relate to contract D0550028628 assumed under the Plan;
-- contract D0550005859 and contract D0550054402 do not relate
to the amounts asserted in Magneti's Claim No. 5743;
-- their books and records do not reflect any cure amount
owing in connection with the assumption and assignment of
contract D0550028628, contract D0550005859 or contract
D0550054402.
The Reorganized Debtors further note that the cure objections
filed by Digi-Key and Sanyo have been resolved, but the
counterparties have not filed formal withdrawals of their
objections. Thus, out of an abundance of caution, the
Reorganized Debtors are including those cure objections in their
current motion so that the Objections can be formally resolved
and the register of asserted cure claims can be clarified. The
Reorganized Debtors point out that:
-- Digi-Key has received an aggregate cure payment of $250
relating to contracts 705648 and 707306. Digi-Key
represented to the Reorganized Debtors in an e-mail dated
February 16, 2010, that its Digi-Key Cure Objection is
fully resolved; and
-- Sanyo filed its notice of withdrawal of objection that
fully its Sanyo's Cure Objection. However, the Notice of
Withdrawal inadvertently identified the Sanyo Electronic
Cure Objection as having been filed at Docket No. 12375,
the docket number corresponding to the Debtors' Notice of
Cure Amount, instead of Docket No. 12701.
The Reorganized Debtors also do not believe that the cure
proposals filed by Georgia Power and TR Butterfield relate to
contracts that were assumed and assigned pursuant to the First
Amended Plan and the Modified Plan and thus, no cure amounts are
owed to those counterparties. Specifically, Georgia Power filed
its cure claim with respect to assumption of a Master Contract
for Electric Power Service under the Modified Plan. The Debtors
note that they closed the Fitzgerald Battery Plant associated
with the Master Contract for Electric Power Service and then
terminated the Master Contract. TR Butterfield submitted an
undocketed cure proposal requiring the Debtors to pay $32,627 as
defaults under a Warehouse Lease agreement. However, the
Warehouse Lease expired on December 31, 2008, and was not renewed.
Moreover, the Reorganized Debtors note that Spartech's cure
proposal has been withdrawn but Spartech has not formally
withdrawn its cure proposal. Spartech asserted that the Debtors
owe it $1,832,945 for contracts to be assumed under the 1st
Amended Plan. Spartech later objected to the Modified Plan,
asserting the same contracts and revised its cure amount to
$236,453. Only one contract of Spartech was assumed and assigned
with a cure amount of $4,581, the Reorganized Debtors aver.
Spartech's other contracts were either expired contracts or
postpetition contracts not subject to the cure procedures.
Against this backdrop, Spartech agreed with the Cure Amounts set
forth in the Debtors' books and records and notified counsel for
the Debtors by e-mail that Spartech would not pursue its Section
365 Objection.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is a global supplier of electronics and
technologies for automotive, commercial vehicle and other market
segments. Delphi operates major technical centers, manufacturing
sites and customer support facilities in 30 countries.
The Company filed for Chapter 11 protection on October 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represented the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represented the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court confirmed Delphi's plan on January 25, 2008. The Plan
was not consummated after a group led by Appaloosa Management,
L.P., backed out from their proposal to provide US$2,550,000,000
in equity financing to Delphi. At the end of July 2009, Delphi
obtained confirmation of a revised plan, build upon a sale of the
assets to a entity formed by some of the lenders who provided
$4 billion of debtor-in-possession financing, and General Motors
Company.
On October 6, 2009, Delphi Corp.'s Chapter 11 plan of
reorganization became effective. A Master Disposition Agreement
executed among Delphi Corporation, Motors Liquidation Company,
General Motors Company, GM Components Holdings LLC, and DIP Holdco
3, LLC, divides Delphi's business among three separate parties --
DPH Holdings LLC, GM Components, and DIP Holdco 3.
Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will
remain responsible for the post-Effective Date administration and
eventual closing of the Chapter 11 cases as well as the
disposition of certain retained assets and payment of certain
retained liabilities as provided under the Modified Plan.
Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Delphi
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
DELPHI CORP: BP Microsystems Opposes Plea for Amended Complaints
----------------------------------------------------------------
DPH Holdings and certain of its affiliated debtors are seeking
permission from the Bankruptcy Court to file amended complaints
in certain adversary proceedings.
In response, on behalf of BP Microsystems, L.P., Christopher B.
Block, Esq., at Gordon & Rees LLP, in New York --
CBlock@GordonRees.com -- reminds the Bankruptcy Court that it
entered an order granting in part First Wave Motions to Dismiss,
which stated that the DPH Holdings Inc. and its affiliates have
abandoned any claim in all of the adversary proceedings against
any defendant that received transfers from the Debtors with an
aggregate value to or for the benefit of the transferee that is
less than $250,000 during the 90 days preceding the Petition Date,
and all those claims in the Adversary Proceedings are dismissed.
In abrogation of the First Wave Order, the Reorganized Debtors
sought leave to file amended complaints, seeking to recover
transfers from BP Microsystems totaling less than $250,000, which
were dismissed by the First Wave Order, Mr. Block stresses.
Thus, BP Microsystems asks the Court to deny the Reorganized
Debtors' request for leave to filed amended complaints as to the
company, as all claims alleged against the company in the First
Amended Complaint were dismissed.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is a global supplier of electronics and
technologies for automotive, commercial vehicle and other market
segments. Delphi operates major technical centers, manufacturing
sites and customer support facilities in 30 countries.
The Company filed for Chapter 11 protection on October 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represented the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represented the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court confirmed Delphi's plan on January 25, 2008. The Plan
was not consummated after a group led by Appaloosa Management,
L.P., backed out from their proposal to provide US$2,550,000,000
in equity financing to Delphi. At the end of July 2009, Delphi
obtained confirmation of a revised plan, build upon a sale of the
assets to a entity formed by some of the lenders who provided
$4 billion of debtor-in-possession financing, and General Motors
Company.
On October 6, 2009, Delphi Corp.'s Chapter 11 plan of
reorganization became effective. A Master Disposition Agreement
executed among Delphi Corporation, Motors Liquidation Company,
General Motors Company, GM Components Holdings LLC, and DIP Holdco
3, LLC, divides Delphi's business among three separate parties --
DPH Holdings LLC, GM Components, and DIP Holdco 3.
Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will
remain responsible for the post-Effective Date administration and
eventual closing of the Chapter 11 cases as well as the
disposition of certain retained assets and payment of certain
retained liabilities as provided under the Modified Plan.
Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Delphi
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
DELPHI CORP: Committees Reach Deal on Trust Amendments
------------------------------------------------------
The VEBA Committee for the Delphi Salaried Retirees Association
Benefit Trust and the Official Committee of Eligible Salaried
Retirees submitted to the Court an agreement resolving outstanding
issues between them.
The parties agree that these amendments are adopted to the DSRA
VEBA Trust Agreement:
(i) Staggered elections of the trustees by the beneficiaries
starting in the first quarter of 2011, before the end of
March, with three new trustees taking office in April
2011; and
(ii) Open nomination process and by mutual agreement, none of
the current or former trustees may stand for election
during the first three annual elections. The voting
provisions of the trust agreement may not simply be
modified later by the trustees, and a two-thirds
supermajority vote is required to remove trustees.
The Retirees Committee and the VEBA Committee believe those
provisions will give the beneficiaries a meaningful vote and the
power to elect and replace the board of the VEBA and that those
changes are responsive to the Court's instruction that no group
should seek to perpetuate itself as the board of the VEBA.
In the meantime, one concerning development has occurred, counsel
to the Retirees Committee, Neil A. Goteiner, Esq., at Farella
Braun & Martel LLP, in San Francisco, California, tells the
Court. He says the provisions of the American Recovery and
Reinvestment Act under which (i) the Court authorized formation
of the VEBA; and (ii) the VEBA's benefits are deemed qualifying
coverage for purposes of the Health Coverage Tax Credit subsidy,
will expire on December 31, 2010, if the U.S. Congress does not
extend the legislation.
Mr. Goteiner states that although the legislation extending the
provisions of the ARRA is expected to pass, it may not pass
before the end of the year, and the Internal Revenue Service has
sent notices that the subsidies for the VEBA's benefit program
will otherwise end after January 2011.
Against this backdrop, the VEBA Committee has asked the Retirees
Committee to work with the Reorganized Debtors to file a motion
with the Court seeking to designate the VEBA's benefit as in lieu
of certain disputed lifetime continuation coverage rights under
Consolidated Omnibus Reconciliation Act or "COBRA" those retirees
might otherwise have been able to assert under Sections 1163(6)
and 1162(2)(A)(iii) of Title 29 of the U.S. Code. This
designation may make it easier for the VEBA Committee to obtain a
private letter ruling, Mr. Goteiner notes.
Except for the request by the VEBA Committee for designation, the
Retirees Committee is done with the adoption of the amendments to
the Trust Agreement.
The Retirees Committee thus asks the Court to delay its
disbandment only until the opportunity to rule on a motion to
designate the VEBA benefit as in lieu of certain COBRA
continuation coverage rights.
A full-text copy of the Amended Trust Agreement is available for
free at http://bankrupt.com/misc/Delphi_AmVEBATrustPact.pdf
Timothy T. Brock, Esq., at Satterlee Stephens Burke & Burke LLP,
in Indianapolis, Indiana, counsel to the VEBA Committee, informed
Judge Drain about the agreement reached between the VEBA
Committee and the Retirees Committee even before a copy of the
Amended Trust Agreement was filed with the Court.
The VEBA Committee consented to the telephonic appearance of Dean
M. Gloster, Esq., counsel to the Retirees Committee, and asked
the Court to allow Patricia Beaty, Esq., counsel to the VEBA
Committee, to appear telephonically at a scheduled November 18,
2010 hearing.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is a global supplier of electronics and
technologies for automotive, commercial vehicle and other market
segments. Delphi operates major technical centers, manufacturing
sites and customer support facilities in 30 countries.
The Company filed for Chapter 11 protection on October 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represented the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represented the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court confirmed Delphi's plan on January 25, 2008. The Plan
was not consummated after a group led by Appaloosa Management,
L.P., backed out from their proposal to provide US$2,550,000,000
in equity financing to Delphi. At the end of July 2009, Delphi
obtained confirmation of a revised plan, build upon a sale of the
assets to a entity formed by some of the lenders who provided
$4 billion of debtor-in-possession financing, and General Motors
Company.
On October 6, 2009, Delphi Corp.'s Chapter 11 plan of
reorganization became effective. A Master Disposition Agreement
executed among Delphi Corporation, Motors Liquidation Company,
General Motors Company, GM Components Holdings LLC, and DIP Holdco
3, LLC, divides Delphi's business among three separate parties --
DPH Holdings LLC, GM Components, and DIP Holdco 3.
Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings will
remain responsible for the post-Effective Date administration and
eventual closing of the Chapter 11 cases as well as the
disposition of certain retained assets and payment of certain
retained liabilities as provided under the Modified Plan.
Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Delphi
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
DIAMOND RANCH: Swings to $107,900 Net Profit in Sept. 30 Quarter
----------------------------------------------------------------
Diamond Ranch Foods Ltd. filed its quarterly report on Form 10-Q,
reporting net income of $107,913 on $1.93 million of revenues for
the three months ended Sept. 30, 2010, compared with a net loss of
$89,952 on $1.87 million of revenues for the same period a year
ago.
The Company's balance sheet at Sept. 30, 2010, showed
$1.29 million in total assets, $6.12 million in total liabilities,
and a stockholders' deficit of $4.82 million.
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?6fb5
About Diamond Ranch
Diamond Ranch Foods, Ltd. -- http://www.diamondranchfoods.com/--
is a meat processing and distribution company now located in the
Hunts Point Coop Market, Bronx, New York. The Company's
operations consist of packing, processing, labeling, and
distributing products to a customer base, including, but not
limited to; in-home food service businesses, retailers, hotels,
restaurants, and institutions, deli and catering operators, and
industry suppliers.
Gruber & Company LLC, in Lake Saint Louis, Missouri, expressed
substantial doubt about Diamond Ranch Foods Ltd.'s ability to
continue as a going concern, noting that the Company has suffered
recurring losses from operations after the firm audited the
Company's balance sheet as of March 31, 2010, and 2009.
DISCOVERY LABS: Restates 10-K to Reflect Warrants Reclassification
------------------------------------------------------------------
Discovery Laboratories filed on November 15, 2010, Amendment No. 2
on Form 10-K/A to its annual report on Form 10-K for the year
ended December 31, 2009, which was filed with the Securities and
Exchange Commission on March 10, 2010, to reflect the
reclassification of certain warrants from equity to liabilities.
The Company has historically accounted for warrants, which prior
to May 2009 were issued in private transactions, as equity
instruments.
"After extensive discussion, the Audit Committee, together with
our management and in consultation with Ernst & Young and our
outside legal advisors, determined that, notwithstanding the
highly-remote and theoretical possibility of net cash settlement,
the warrants identified above should have been recorded as
liabilities, measured at fair value calculated using the Black
Scholes option pricing model on the date of issue, with changes in
the fair values recognized in our quarterly statement of
operations in our quarterly financial reports."
"Accordingly, the Audit Committee also concluded on November 8,
2010, that our previously-filed consolidated financial statements
for the year ended December 31, 2009, on Form 10-K; Ernst &
Young's reports on the financial statements and the effectiveness
of internal control over financial reporting for the year ended
December 31, 2009; each of the consolidated financial statements
included in our quarterly reports on Form 10-Q for the periods
ended June 30, 2009, and September 30, 2009; and all related
earnings releases and similar communications that we issued with
respect to the foregoing, should no longer be relied upon."
The Company reported a net loss (restated) of $29.9 million on $0
revenue for 2009, compared with a net loss of $39.1 million on
$4.6 million of revenue for 2008.
As restated, the Company's balance sheet at December 31, 2009,
showed $21.4 million in total assets, $20.1 million in total
liabilities, and stockholders' equity of $1.3 million.
A full-text copy of the Form 10-K/A is available for free at:
http://researcharchives.com/t/s?6f9e
About Discovery Laboratories
Warrington, Pa.-based Discovery Laboratories, Inc. (Nasdaq: DSCO)
-- http://www.Discoverylabs.com/-- is a biotechnology company
developing KL4 surfactant therapies for respiratory diseases.
As reported in the Troubled Company Reporter on March 15, 2010,
Ernst & Young LLP, in Philadelphia, expressed substantial doubt
about the Company's ability to continue as a going concern,
following the Company's 2009 results. The independent auditors
noted of the Company's recurring operating losses and negative
cash flows from operations since inception.
The report is dated March 10, 2010, except for the effects of the
material weakness in internal controls over the classification of
and subsequent accounting for registered warrants, as to which the
date is November 12, 2010.
DMCT LLC: Hearing on Substantial Asset Sale Set for Dec. 2
----------------------------------------------------------
DMCT, L.L.C., filed its Emergency Motion to Sell Substantially all
of the Debtor''s Assets and to Assume and Assign Certain Executory
Contracts and Unexpired Leases Thereto on Oct. 29, 2010, asking
the Bankruptcy Court for authority to sell substantially all of
its Assets and Contracts (as those terms are defined in the
Motion). A copy of the Motion describing the Assets and Contracts
is available from the Debtor's Counsel:
Scott R. Goldberg Esq.
Schian Walker
3550 North Central Avenue, Suite 1700
Phoenix, AZ 85012
Telephone: 602-277-1501
E-mail: sgoldberg@swazlaw.com
The Honorable Randolph J. Haines has scheduled a hearing to
consider the asset sale for Dec. 2, 2010, at 9:00 a.m. in Phoenix,
Ariz.
Notice of the filing of the Emergency Motion and hearing was
published in the Arizona Republic on Thanksgiving Day, Nov. 25,
2010.
DMCT, LLC, sought chapter 11 protection (Bankr. D. Ariz. Case No.
10-32577) on Oct. 8, 2010. A copy of the Debtor's petition is
available at http://bankrupt.com/misc/azb10-32577.pdfat no
charge.
DYNEGY INC: Fitch Junks Issuer Default Rating From 'B-'
-------------------------------------------------------
Fitch Ratings has removed from Rating Watch Evolving and
downgraded the ratings of Dynegy Inc. and its subsidiaries:
Dynegy Inc.
-- Issuer Default Rating to 'CCC' from 'B-'.
Dynegy Holdings, Inc.
-- IDR to 'CCC' from 'B-';
-- Secured bank credit facilities and notes to 'B+/RR1' from BB-
/RR1;
-- Senior unsecured to 'CCC/RR4' from 'B/RR3'.
Dynegy Capital Trust I
-- Trust preferred to 'C/RR6' from 'CCC/RR6'.
The Rating Outlook is Negative.
The downgrade reflects Fitch's belief that the rejection of The
Blackstone Group's bid to acquire Dynegy for $5/share will likely
lead to another transaction and capital restructuring by Dynegy's
management as activist stockholders seek to maximize shareholder
values.
The downgrade also reflects the underperformance of Dynegy's
merchant generation operations. There is a high correlation of
Dynegy's future financial performance to improvement in power
prices, shrinkage in the reserve capacity margins in the wholesale
markets Dynegy owns and operates its generating plants, and
improvement in electricity demand. Fitch believes these macro
market factors will improve, albeit too slowly in the near term,
for Dynegy to generate sufficient cash flow for its capital and
operating needs. Operating EBITDA and cash flow at Dynegy
continues to be negatively impacted by the decline in hedged
electricity and fuel commodity margins, largely affected by the
low electricity and fuel commodity prices. Fitch believes that
Dynegy has taken steps to increase the stability of its earnings
and cash flow in 2011 by contracting for 95% of its expected
volumetric baseload output, however, credit metrics are forecasted
to remain weak and are more appropriate to the lower ratings
level.
Fitch had placed Dynegy on Rating Watch Evolving following
Blackstone's announcement that it would acquire Dynegy for $4.7
billion, including assumption of debt. The Rating Watch Evolving
reflected the uncertainty regarding the final profile and capital
structure of the company following the close of the acquisition
and sale of the assets, and disposition and application of sale
proceeds. The sale of California and Maine power plants to NRG
Energy, Inc. for approximately $1.4 billion was contingent upon
acceptance of the Blackstone offer.
Dynegy's current liquidity position remain relatively stable and
is sufficient in the near term, but continuous capital
requirements and projected declining cash flow from operations
will force Dynegy to access capital markets under more stressful
conditions. As of Nov. 8, 2010, Dynegy had $2 billion in
available liquidity, consisting of $640 million in cash and
$1.4 billion in available bank facilities. The available line of
credit was reduced by $53 million due to covenant limitations and
is expected to be reduced further if financial ratios do not
improve by Dec. 31, 2010. An additional $150 million in the
letter of credit facility is available contingent upon increases
in spark spreads and the wholesale power prices. The bank
facility will expire in 2012. Continued weakness in power and
natural gas prices, and Dynegy's environmental capital spending
plans will pressure the capital structure and liquidity position.
In Fitch's view, with decreasing operating cash flow, Dynegy's
asset valuations have declined and the current leverage would lead
to weak recoveries for unsecured debtholders in case of default.
Fitch assigns Recovery Ratings (RRs) to issuers with IDRs in the
'B' category or below. For competitive generating companies like
Dynegy, Fitch generates a theoretical distressed enterprise value
based on the projected EBITDA multiple. Based on Fitch's EBITDA
multiple enterprise value, secured debt holders could expect
strong recovery of claims in case of a default which is reflective
of the RR1 rating on Dynegy's secured debt. The RR4 rating on
Dynegy's unsecured notes indicates average recovery prospects in a
default situation (31-50%) due to the subordinated nature of the
issue and significantly lower asset valuations. RR6 rating on
Dynegy's trust preferred notes reflect poor recovery prospects (0-
10%)given the deep subordination of the securities.
Fitch expects that without significant improvement in electricity
prices, Dynegy's interest coverage ratio, based on funds from
operations, for 2011 and 2012 will fall below 1 times and
leverage, also based on FFO, may increase up to 14x. Year-end
2010 interest coverage and leverage, based on FFO, are expected to
be 1.4x and 8.6x, respectively.
The Negative Outlook reflects Fitch's expectations that Dynegy's
credit measures will likely deteriorate into next year and a
corporate transaction and capital restructuring are likely.
Dynegy is engaged in the generation and sale of wholesale electric
power. Dynegy owns approximately 12,200 megawatts of wholesale
power assets.
EARTHBOUND HOLDING: Moody's Assigns 'B2' Corporate Family Rating
----------------------------------------------------------------
Moody's Investors Service has assigned a B2 corporate family
rating to Earthbound Holding III, LLC, and a B1 rating to its
proposed $250 million senior credit facilities. Proceeds from the
proposed refinancing are expected to be used primarily to retire
existing debt and pay a dividend. The rating outlook is stable.
These ratings have been assigned subject to review of final
documentation:
-- B2 corporate family rating;
-- B2 probability of default rating;
-- B1 (LGD3, 39%) to the proposed $25 million senior secured
revolving credit facility due 2015; and
-- B1 (LGD3, 39%) to the proposed $225 million senior secured
term loan facility due 2016.
Ratings Rationale
The B2 corporate family rating reflects Earthbound's stable
operating performance, strong brand equity and leadership position
in the niche organic packaged salad industry. Further, the rating
benefits from the company's exclusive grower network and limited
availability of US$A certified organic fields and processing
facilities in North America. Conversely, the rating reflects its
small scale relative to rating peers, high post-refinancing
leverage, historically owner friendly financial policies,
geographic concentration of its supply base, limited category
diversification and exposure to external event risk.
The stable outlook reflects Moody's expectation that the company
will maintain an adequate liquidity profile supported by
substantial availability of its revolver and modest cash
generation over the next twelve months. The outlook also
incorporates the expectation that dividends will be limited to
cover owner tax distributions and that acquisitions, if any, will
be small in scale.
The proposed credit facilities are expected to be secured by an
all asset first lien security interest. In addition, the
facilities are expected to benefit from upstream and downstream
guarantees and will be subject to two financial maintenance
covenants set with adequate headroom. The capital structure is
also expected to contain an unrated $85 million mezzanine loan
facility and roughly $40 million of holding company PIK preferred
stock, which contains an optional put right beginning in 2015.
The ratings and/or outlook could face positive pressure if the
company executes on its strategy to permanently reduce debt while
maintaining conservative financial policies. Adjusted leverage
permanently reduced below 4.0x would be viewed positively.
Moody's anticipates that post-refinancing leverage, before
consideration of preferred stock, will be roughly 4.7x including
operating leases. The ratings could be downgraded if the company
were to execute a debt financed acquisition or liquidity were to
deteriorate leading to leverage approaching 6.0x
Earthbound is engaged in the processing and sale of organic
salads, fruits, vegetables, and specialty salads under the
trademark Earthbound Farm. Earthbound's products are sold through
a diversified group of retailers and foodservice companies in
North America. Revenues for the twelve months ending
September 30, 2010, were roughly $425 million.
EDMUND ANDERSON: Case Summary & 10 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Edmund Lincoln Anderson
1932 Rochester Circle
Los Angeles, CA 90018
Bankruptcy Case No.: 10-95101
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
Northern District of Georgia (Atlanta)
Judge: C. Ray Mullins
Debtor's Counsel: Dorna Jenkins Taylor, Esq.
TAYLOR & ASSOCIATES, LLC
1401 Peachtree Street, Suite 500
Atlanta, GA 30309
Tel: (404) 870-3560
Fax: (404) 745-0136
E-mail: dorna.taylor@taylorattorneys.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Debtor's 10 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/ganb10-95101.pdf
EMPIRE RESORTS: Stockholder Lends $35-Mil. for Debt Refinancing
---------------------------------------------------------------
Empire Resorts Inc. has entered into a loan agreement with Kien
Huat Realty III Limited, the company's largest stockholder,
pursuant to which Kien Huat has provided the Company with a loan
in the aggregate principal amount of $35 million.
The Company said it used the proceeds of the Loan, together with
available funds, to repay in full the company's obligations under
its 5.5% convertible senior notes due 2014. The repayment of the
Notes from the proceeds of the Loan was made in accordance with
the terms of that certain settlement agreement entered into by
the Company on September 23, 2010 among the trustee under the
indenture governing the Notes and the beneficial owners of the
Notes party thereto. In connection with the repurchase of the
Notes, the Company and the beneficial owners of the Notes have
resolved all outstanding claims and the beneficial owners of the
Notes have agreed to release all liens on the Company's assets.
Empire Resorts Chairman of the Board Emanuel R. Pearlman
commented, "The Board of Directors is pleased to have closed this
loan and repurchased our notes. It is an important initial step
and leaves us well positioned to move the company forward."
The Loan bears interest at the rate of 5% per annum, payable
monthly. The loan matures on the earlier to occur of the
consummation of the Company's proposed rights offering and June
30, 2011, subject to extension under certain circumstances. The
Company intends to conduct a rights offering upon terms to be
determined by the board of directors of the Company. In the
rights offering, if conducted, the Company would distribute to all
holders of the Company's common stock a non-transferrable right to
purchase additional shares of the Company's common stock at a
price of $0.8837 per share, which is equivalent to the conversion
price of the restated notes that would have been issued pursuant
to the settlement agreement if the Notes had not been repurchased.
Kien Huat has committed to exercise all of its basic rights to
purchase additional shares allocated to Kien Huat with respect to
its current ownership of the Company's common stock. If, upon the
completion of the rights offering, the proceeds of the rights
offering are insufficient to repay in full all amounts outstanding
on the Loan, the full amount remaining unpaid will be extended
for a term of two years at an interest rate of 5% per annum
convertible into the Company's common stock at a price equal to
the $0.8837 per share exercise price of the rights to be issued in
the rights offering.
Empire Resorts CEO Joseph D'Amato added, "The restructuring of our
indebtedness is an important milestone for Empire Resorts. As a
result of this transaction, the company has over $7 million in
working capital. We look forward to focusing on the completion of
our rights offering which will further enhance the company's
financial position. We are optimistic that resolving these
financing matters will allow Empire Resorts to focus on our
ongoing efforts to enhance shareholder value."
A full-text copy of the loan agreement is available for free
at http://ResearchArchives.com/t/s?6fb8
About Empire Resorts
Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY)
-- http://www.empireresorts.com/-- owns and operates Monticello
Casino & Raceway, a video gaming machine and harness racing track
and casino located in Monticello, New York, 90 miles northwest of
New York City.
The Company's balance sheet at Sept. 30, 2010, showed
$74.91 million in total assets, $63.20 million in total
liabilities, and stockholders' equity of $11.71 million.
Auditor Friedman LLP, in New York, after auditing the Company's
2009 results, said Empire Resorts' ability to continue as a going
concern depends on the Company's ability to fulfill its
obligations with respect to its $65 million of 5-1/2% senior
convertible notes. Friedman also noted of the Company's
continuing net losses and negative cash flows from operating
activities.
ESSAR STEEL: S&P Puts 'B-' Rating on CreditWatch Negative
---------------------------------------------------------
Standard & Poor's Ratings Services said it placed its ratings,
including its 'B-' long-term corporate credit rating, on Sault
Ste. Marie, Ontario-based Essar Steel Algoma Inc. on CreditWatch
with negative implications.
"The CreditWatch placement follows what S&P views as a likely
deterioration in the company's liquidity," said Standard & Poor's
credit analyst Donald Marleau. "S&P believes that a potentially
large impending payment to a key supplier could consume most of
the company's current liquidity amid higher working-capital
requirements," Mr. Marleau added.
ESA's profitability has been improving along with higher steel
prices since early 2010, but S&P believes that this belies the key
credit risks stemming from the prospective arbitration of a
pricing dispute with its main supplier of iron ore, Cliffs Natural
Resources Inc. (BBB-/Stable/--).
S&P expects that resolution of the dispute will come at a cost to
ESA -- as high as US$175 million -- potentially consuming a
meaningful portion of its liquidity. The amount that ESA will
ultimately pay reflects the difference between the December 2009
price for iron ore that it paid and the arbitrated 2010 price
for volumes consumed to date. With C$16 million in cash and
C$220 million available on its revolving credit facility at the
end of the second quarter of this fiscal year, ESA's liquidity
could deteriorate to below S&P's key C$100 million threshold for
rating pressure. In addition, higher contractual prices for iron
ore will reduce the company's profitability amid continuing
uncertainty about steel prices.
The ratings on ESA reflect what Standard & Poor's views as the
company's limited operating diversity, the volatility of its end
markets, and its large debt burden. In Standard & Poor's opinion,
these risks are counterbalanced by the cost efficiency of the
company's assets.
S&P views the rating on ESA as sensitive to potentially weak steel
market conditions and their effect on liquidity. Although market
conditions support a modest year-over-year improvement in
profitability, cash flow and liquidity will remain weak,
particularly after incorporating the arbitration settlement. The
company's working-capital investment will increase along with the
higher expected iron ore price, although this will be muted by
ESA's seasonally slower inventory build in the winter. The
company's costs for volumes consumed in calendar 2010 will be
adjusted, contributing to weaker trailing earnings and cash flow
measures, although S&P believes this is a less important risk
because of the absence of maintenance financial covenants in its
borrowings.
Standard & Poor's expects to resolve this CreditWatch when the
arbitration outcome is clear, likely very late in 2010 or early in
2011.
EVANS CONVENIENCE: Case Summary & 4 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Evans Convenience & Carwash, LLC
dba 7-11 Store No. 39036A
Evans Quality Carwash
fdba Evans Quality Convenience
7506 Plateau Road
Greeley, CO 80634
Bankruptcy Case No.: 10-39726
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
District of Colorado (Denver)
Judge: Howard R. Tallman
Debtor's Counsel: Arthur Lindquist-Kleissler, Esq.
950 S. Cherry Street, Suite 710
Denver, CO 80246
Tel: (303) 691-9774
E-mail: Arthuralklaw@gmail.com
Scheduled Assets: $1,206,700
Scheduled Debts: $1,664,304
A list of the Company's four largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/cob10-39726.pdf
The petition was signed by Wanchai & Ruayrin Hongdoxmai, managing
members.
FIRST BANCORP: Fitch Downgrades Issuer Default Rating to 'CC'
-------------------------------------------------------------
Fitch Ratings has removed from Rating Watch Negative and
downgraded the long-term Issuer Default Ratings of First BanCorp
and its main subsidiary, Firstbank Puerto Rico to 'CC'. Fitch's
rating actions are mainly predicated on the company's publicly
disclosed capital plans and how these are viewed under Fitch's
rating criteria and definitions. These actions do not take into
consideration any nonpublic information.
FBP announced a series of initiatives to bolster its balance
sheet. These mainly entail improving the common equity component
of its overall capitalization. FBP's capital strategies encompass
three actions: 1) the conversion of the company's $550 million
perpetual preferred stock which was completed on Aug. 30, 2010;
2) raising additional common stock of up to $500 million, which is
presently ongoing; and 3) the conversion of the U.S. Treasury's
Capital Purchase Program preferred shares, which is contingent
upon the raising the additional equity. Taken together, and if
successful, FBP estimates that pro forma tangible common equity
ratio will increase to 10%.
The rating actions primarily reflects Fitch's view that the
capital strategies First Bancorp has pursued are necessitated by
its weakened financial condition and reflective of heightened
credit risk compared to historical performance. While the
conversion of preferred stock into common serves to improve
tangible common ratios, coupled with the U.S. Treasury's agreement
to convert its CPP investment into common upon additional outside
equity raises, is indicative of an institution which requires
external support in order to remain viable. As such, under
Fitch's Individual Rating definitions and scale, this is
consistent with an Individual Rating of 'E', which indicates a
bank with very serious problems, which either requires or is
likely to require external support. Further, as Fitch noted in
its press release dated June 25, 2010, when all of FBP's ratings
were placed on Rating Watch Negative, any event that would be
viewed by Fitch as providing support above and beyond that which
has been provided to others in order for FBP to continue to
operate, Fitch will deem this a failure under its criteria.
If FBP is successful in recapitalizing itself, Fitch recognizes
that this would be a positive development for the institution as
it would provide more absorption for potential losses. Moreover,
FBP has materially reduced its balance sheet by $2.8 billion from
year-end 2009, which serves to further improve the company's
balance sheet. Moreover, the improved balance sheet strengthens
the company's tangible common equity position, which provides the
company cushion to absorb losses due to the weakened real estate
conditions in Puerto Rico and South Florida as well as challenging
macro conditions in Puerto Rico. Even without the additional
equity raise, FBP has already improved its tangible common equity
ratio to 5.21% for 3Q'10 from 2.57% at 2Q'10, through the
aforementioned conversion of preferred stock. Fitch recognizes
that FBP continues to comply with the Consent Order with new
minimum capital requirements to be achieved overtime of Leverage
of 8%, a Tier 1 Risk Based Capital of 10%, and Total RBC of 12%.
Fitch's rating actions are the result of a focused review of
Fitch's 'Master Global Financial Institutions Criteria' dated
Aug. 16, 2010. This review concentrated in particular on
capitalization. In performing its analysis of Recovery Ratings,
Fitch employed some assumptions that were more conservative than
those outlined in its criteria 'Recovery Ratings for Financial
Institutions' dated Dec. 30, 2009. Some of the recovery rates for
certain loan categories were assumed to be lower to reflect the
current distressed credit environment.
Fitch has downgraded and removed from Rating Watch Negative these
ratings:
First BanCorp
-- Long-term IDR to 'CC' from 'B-';
-- Individual to 'E' from 'D/E'.
FirstBank Puerto Rico
-- Long-term IDR to 'CC' from 'B-';
-- Long-term deposit obligations to 'CCC/RR3' from 'B+/RR2';
-- Individual to 'E' from 'D/E';
-- Short-term IDR to 'C' from 'B';
-- Short-term Deposits at 'C' from 'B'.
These ratings remain unchanged:
First BanCorp
-- Short-term IDR 'C';
-- Support '5';
-- Support floor 'NF'.
FirstBank Puerto Rico
-- Support '5';
-- Support floor 'NF'.
FONTAINEBLEAU LV: $13.9 Mil. in Claims Changed Hands in September
-----------------------------------------------------------------
The Clerk of the Bankruptcy Court recorded the transfer of six
claims totaling $13,942,580 for the period September 1 -
September 30, 2010. The claims are:
Transferor Transferee Claim No. Amount
---------- ---------- --------- ------
Avenue CLO II Cantor Fitzgerald -- $3,098,351
Limited Securities
Avenue CLO III Cantor Fitzgerald -- 3,098,351
Limited Securities
Avenue CLO Fund Cantor Fitzgerald -- 3,098,351
Limited Securities
Avenue CLO Fund Cantor Fitzgerald 379 1,549,175
Limited Securities
Avenue CLO II Cantor Fitzgerald 635 1,549,175
Limited Securities
Avenue CLO III Cantor Fitzgerald 694 1,549,175
Limited Securities
There has been a significant drop in Fontainebleau's claim
transfers for September 2010 as compared to August 2010.
The Clerk of the Bankruptcy Court previously recorded the transfer
of 96 claims totaling $323,788,166 for the period from August 1 -
August 31, 2010.
Susan Gutierrez, the Court's Deputy Clerk, notifies parties-in-
interest that pursuant to Rule 3001(e) of the Federal Rules of
Bankruptcy Procedure, evidences of complete or partial transfer of
the transferred claims have been filed with the Court.
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is
constructing a luxury resort, Fontainebleu Las Vegas, on the
northern end of the Las Vegas Strip.
Fontainebleau Las Vegas Holdings, LLC and its units filed for
Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case
No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena
Price & Axelrod LLP, represented the Debtors in their
restructuring effort. The Debtors' claims agent is Kurtzman
Carson Consulting LLC. Attorneys at Genovese Joblove & Battista,
P.A., and Fox Rothschild, LLP, represent the Official Committee of
Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than
$1 billion in debt and a similar amount in assets, while each of
Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas
Holdings, LLC, listed less than $50,000 in assets and more than
$1 billion in debts.
In February 2010, Icahn Enterprises L.P. acquired from
Fontainebleau Las Vegas and certain affiliated entities, the
Fontainebleau property and improvements thereon located in Las
Vegas, Nevada, for an aggregate purchase price of around
$150 million. The bankruptcy case was subsequently converted to
Chapter 7.
Soneet R. Kapila has been named the trustee for the Chapter 7 case
of Fontainebleau Las Vegas.
FONTAINEBLEAU LV: $323 Million in Claims Changed Hands in August
----------------------------------------------------------------
The Clerk of the Bankruptcy Court recorded the transfer of 96
claims totaling $323,788,166 for the period August 1 - August 31,
2010. The largest claims include:
Transferor Transferee Claim No. Amount
---------- ---------- --------- ------
Bombard Electric JMB Capital 881 $163,903,675
LLC Partners Master
Fund, LP
Desert Fire JMB Capital 882 17,086,377
Protection Partners Master
Fund, LP
Bombard Mechanical JMB Capital 879 9,525,710
LLC Partners Master
Fund, LP
Cantor Fitzgerald Sola Ltd. - 9,115,755
Securities
Cantor Fitzgerald Solus Core - 7,765,273
Securities Opportunities
Master Fund Ltd.
Duane Street Cantor Fitzgerald - 4,666,666
CLO IV Ltd. Securities
Fidelity Central Cantor Fitzgerald - 4,615,708
Investment Securities
Portfolio LLC
Cantor Fitzgerald Sola Ltd. 767 4,384,244
Securities
Wexford Spectrum Morgan Stanley 587 4,348,395
Investors LLC Senior Funding Inc.
Cantor Fitzgerald Solus Core 370 3,734,726
Securities Opportunities Master
Fund Ltd.
Centurion CDO Cantor Fitzgerald - 2,563,181
VII Ltd. Securities
A copy of the complete list of claim transfers for August 2010 is
available for free at:
http://bankrupt.com/misc/FB_ClaimTransfers_August2010.pdf
Although the number of Fontainebleau's claim transfers has dropped
in August 2010, the amount of the transferred claims is much
bigger than that of the previous month.
The Clerk of the Bankruptcy Court previously recorded the transfer
of 134 claims totaling $260,871,886 for the period from July 1 -
July 31, 2010.
Susan Gutierrez, the Court's Deputy Clerk, notifies parties-in-
interest that pursuant to Rule 3001(e) of the Federal Rules of
Bankruptcy Procedure, evidences of complete or partial transfer of
the transferred claims have been filed with the Court.
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is
constructing a luxury resort, Fontainebleu Las Vegas, on the
northern end of the Las Vegas Strip.
Fontainebleau Las Vegas Holdings, LLC and its units filed for
Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case
No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena
Price & Axelrod LLP, represented the Debtors in their
restructuring effort. The Debtors' claims agent is Kurtzman
Carson Consulting LLC. Attorneys at Genovese Joblove & Battista,
P.A., and Fox Rothschild, LLP, represent the Official Committee of
Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than
$1 billion in debt and a similar amount in assets, while each of
Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas
Holdings, LLC, listed less than $50,000 in assets and more than
$1 billion in debts.
In February 2010, Icahn Enterprises L.P. acquired from
Fontainebleau Las Vegas and certain affiliated entities, the
Fontainebleau property and improvements thereon located in Las
Vegas, Nevada, for an aggregate purchase price of around
$150 million. The bankruptcy case was subsequently converted to
Chapter 7.
Soneet R. Kapila has been named the trustee for the Chapter 7 case
of Fontainebleau Las Vegas.
FONTAINEBLEAU LV: Ch. 7 Trustee Takes Appeal of MDL Final Judgment
------------------------------------------------------------------
Soneet R. Kapila, Fontainebleau Las Vegas Holdings' Chapter 7
Trustee, notified the U.S. District Court for the Southern
District of Florida that he will take an appeal to the United
States Court of Appeals for the Eleventh Circuit from the District
Court's final judgment entered on September 20, 2010, in the
Debtors' multidistrict litigation, as well as from the order of
dismissal with prejudice entered on the same day in the MDL, and
from all adverse orders entered on or prior to that date,
including the District Court's August 26, 2009 decision and order
denying partial summary judgment to Fontainebleau Las Vegas LLC in
its lawsuit against the Revolving Lenders.
The District Court entered on September 20 the Final Judgment
against Mr. Kapila on his claims against the Revolving Lenders for
their failure to fund Fontainebleau's Notices of Borrowing dated
March 2 and March 3, 2009, in breach of the Fontainebleau Credit
Agreement. At Mr. Kapila's behest, the District Court also
dismissed Fontainebleau's claims against the Revolving Lenders so
he can commence an appeal.
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is
constructing a luxury resort, Fontainebleu Las Vegas, on the
northern end of the Las Vegas Strip.
Fontainebleau Las Vegas Holdings, LLC and its units filed for
Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case
No. 09-21481). Scott L Baena, Esq., at Bilzin Sumberg Baena
Price & Axelrod LLP, represented the Debtors in their
restructuring effort. The Debtors' claims agent is Kurtzman
Carson Consulting LLC. Attorneys at Genovese Joblove & Battista,
P.A., and Fox Rothschild, LLP, represent the Official Committee of
Unsecured Creditors. Fontainebleau Las Vegas LLC listed more than
$1 billion in debt and a similar amount in assets, while each of
Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas
Holdings, LLC, listed less than $50,000 in assets and more than
$1 billion in debts.
In February 2010, Icahn Enterprises L.P. acquired from
Fontainebleau Las Vegas and certain affiliated entities, the
Fontainebleau property and improvements thereon located in Las
Vegas, Nevada, for an aggregate purchase price of around
$150 million. The bankruptcy case was subsequently converted to
Chapter 7.
Soneet R. Kapila has been named the trustee for the Chapter 7 case
of Fontainebleau Las Vegas.
FORD MOTOR: Conversion Offers Reduce Debt by $1.9 Billion
---------------------------------------------------------
Ford Motor Company on Wednesday unveiled the results of conversion
offers that will reduce the Company's Automotive debt by more than
$1.9 billion, further strengthening its balance sheet and lowering
annualized interest costs by about $180 million.
Including the conversion offers, the recent $3.6 billion
prepayment on VEBA Note B and net debt reductions over the first
nine months of 2010, Ford has reduced its Automotive debt by
$12.8 billion this year, lowering its annualized interest costs by
nearly $1 billion.
"These successful conversion offers represent another significant
step toward our goal of reducing our Automotive debt and improving
our balance sheet," said Lewis Booth, Ford executive vice
president and chief financial officer. "We had previously said
that even without the conversion offers, we expected our
Automotive cash to be about equal to Automotive debt by the end of
this year, well ahead of our earlier expectations. With the
conversion offers, we will be clearly net cash positive by year-
end 2010."
Ford launched the conversion offers Oct. 26, 2010, offering to pay
a premium in cash to induce the holders of any and all of its
outstanding 4.25% Senior Convertible Notes due December 15, 2036
and 4.25% Senior Convertible Notes due November 15, 2016 to
convert their Convertible Notes into shares of Ford's common
stock.
The conversion offers each expired at midnight, New York City
time, Nov. 23, 2010. As of the Expiration Date, $554 million
principal amount of the 2036 Convertible Notes and $1.992 billion
principal amount of the 2016 Convertible Notes were validly
tendered and accepted for purchase, according to information
provided by Computershare, Inc., the Exchange Agent with respect
to the conversion offers. The carrying values of the tendered
notes on Sept. 30, 2010 were $399 million and $1.544 billion for
the 2036 and 2016 Convertible Notes, respectively.
This will result in the issuance of an aggregate of 274 million
shares of Ford's common stock and the payment of an aggregate of
$534 million in cash premiums on the expected settlement date of
Nov. 30, 2010. The cash premiums reflect in large part the
present value of the interest payments that would have been made
on the tendered 2036 and 2016 Convertible Notes to the first date
(Dec. 20, 2013, and Nov. 20, 2014, respectively) on which Ford
could have terminated holders' conversion rights under the
Convertible Notes. The shares of Ford common stock to be issued
on the settlement date with respect to the conversion offers have
been included in Ford's calculation of diluted earnings per share
since the beginning of the year. In addition to the shares of
Ford common stock and cash premiums, Ford will pay accrued and
unpaid interest on tendered Convertible Notes for the period from
the last interest payment date to (but excluding) the settlement
date, which will total $14 million.
Upon settlement of the conversion offers, $25 million principal
amount and $883 million principal amount of the 2036 and 2016
Convertible Notes, respectively, will remain outstanding. After
settlement, the carrying values of the remaining notes outstanding
will be $18 million and $688 million for the 2036 and 2016
Convertible Notes, respectively.
Holders of the 2036 Convertible Notes who validly tendered and did
not withdraw their Convertible Notes by midnight, New York City
time, on the Expiration Date and whose Convertible Notes were
accepted for purchase will receive, for each $1,000 principal
amount of the 2036 Convertible Notes converted, 108.6957 shares of
Ford's common stock, plus $190 in cash, plus the applicable
accrued and unpaid interest.
Holders of the 2016 Convertible Notes who validly tendered and did
not withdraw their Convertible Notes by midnight, New York City
time, on the Expiration Date and whose Convertible Notes were
accepted for purchase will receive, for each $1,000 principal
amount of the 2016 Convertible Notes converted, 107.5269 shares of
Ford's common stock, plus $215 in cash, plus the applicable
accrued and unpaid interest.
The conversion offers will result in a fourth quarter 2010 special
item charge of approximately $960 million reflecting the cash
premiums and non-cash losses (reflecting the difference between
the carrying and fair values of the debt) for the tendered 2036
and 2016 Convertible Notes.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
across six continents. With about 200,000 employees and about 90
plants worldwide, the company's automotive brands include Ford,
Lincoln, Mercury and Volvo. The Company provides financial
services through Ford Motor Credit Company.
Ford's balance sheet at Sept. 30, 2010, showed $177.07 billion in
total assets, $178.81 billion in total liabilities, and a
stockholders' deficit of $1.77 billion.
* * *
As reported by the Troubled Company Reporter on October 12, 2010,
Moody's Investors Service raised the Corporate Family Rating of
Ford Motor to Ba2 from B1. Other ratings that were raised include
Probability of Default to Ba2 from B1; senior secured credit
facility to Baa3 from Ba1; senior unsecured to Ba3 from B2; and,
preferred stock to B1 from B3. Moody's also raised the CFR and
senior unsecured ratings of Ford Motor Credit Company LLC, FCE
Bank Plc, and Ford Credit Canada Limited to Ba2 from Ba3. The
rating outlook for Ford and Ford Credit is stable.
Moody's said Ford's operating performance exceeded expectations
during the first half of 2010. Moody's believe that Ford is well
positioned to continue generating strong earnings and cash flow
through 2011, and to further strengthen its balance sheet. Ford's
ability to achieve this progress will be supported by the much
healthier industry fundamentals that have resulted from the
extensive restructuring of the US automotive sector during the
past two years, and by Ford's highly competitive product
portfolio.
As reported by the TCR in August 2010, Dominion Bond Rating
Service upgraded the Issuer Rating of Ford Motor to BB (low) from
B; Fitch Ratings upgraded Ford's and Ford Motor Credit's Issuer
Default Ratings to 'BB-' from 'B'; and Standard & Poor's Ratings
Services raised its corporate credit rating on Ford Motor and Ford
Motor Credit LLC to 'B+' from 'B-'. The rating agencies cited
Ford's strong financial performance and substantial debt reduction
accomplished in the second quarter of 2010.
FORD MOTOR: Financing Arm to Redeem NYSE-Listed Notes
-----------------------------------------------------
Ford Motor Credit Company intends to redeem all of its outstanding
7-3/8% Notes due October 15, 2031 (NYSE: "FCZ") and all of its
outstanding 7.60% Notes due March 1, 2032 (NYSE: "FCJ") on
December 23, 2010.
The redemption price for each of the Notes will be equal to 100%
of the principal amount of such Notes outstanding, plus accrued
and unpaid interest thereon to the Redemption Date.
The Bank of New York Mellon is the trustee for each of the Notes
and will act as the redemption agent for these transactions. The
Bank of New York Mellon's address is P.O. Box 396, Attn: Debt
Processing Unit (ACT), East Syracuse, NY 13057.
The 2031 Notes and the 2032 Notes will each become due and
payable, at the Redemption Price, upon presentation and surrender
of the respective Notes, on or after the Redemption Date at the
office of the Trustee.
The 2031 Notes (FCZ) were originally issued on October 11, 2001
and October 24, 2001 in the aggregate principal amount of
$750,000,000, all of which principal amount remains outstanding.
The 2032 Notes (FCJ) were originally issued on February 27, 2002
and March 7, 2002 in the aggregate principal amount of
$562,500,000, all of which principal amount remains outstanding.
Holders of Notes with questions regarding the details of the
redemption may call The Bank of New York Mellon Bondholder
Relations Department at 1-800-254-2826.
Ford Motor Credit Company LLC is one of the world's largest
automotive finance companies and has provided dealer and customer
financing to support the sale of Ford Motor Company products since
1959. Ford Credit is an indirect, wholly owned subsidiary of
Ford.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
across six continents. With about 200,000 employees and about 90
plants worldwide, the company's automotive brands include Ford,
Lincoln, Mercury and Volvo. The Company provides financial
services through Ford Motor Credit Company.
Ford's balance sheet at Sept. 30, 2010, showed $177.07 billion in
total assets, $178.81 billion in total liabilities, and a
stockholders' deficit of $1.77 billion.
* * *
As reported by the Troubled Company Reporter on October 12, 2010,
Moody's Investors Service raised the Corporate Family Rating of
Ford Motor to Ba2 from B1. Other ratings that were raised include
Probability of Default to Ba2 from B1; senior secured credit
facility to Baa3 from Ba1; senior unsecured to Ba3 from B2; and,
preferred stock to B1 from B3. Moody's also raised the CFR and
senior unsecured ratings of Ford Motor Credit Company LLC, FCE
Bank Plc, and Ford Credit Canada Limited to Ba2 from Ba3. The
rating outlook for Ford and Ford Credit is stable.
Moody's said Ford's operating performance exceeded expectations
during the first half of 2010. Moody's believe that Ford is well
positioned to continue generating strong earnings and cash flow
through 2011, and to further strengthen its balance sheet. Ford's
ability to achieve this progress will be supported by the much
healthier industry fundamentals that have resulted from the
extensive restructuring of the US automotive sector during the
past two years, and by Ford's highly competitive product
portfolio.
As reported by the TCR in August 2010, Dominion Bond Rating
Service upgraded the Issuer Rating of Ford Motor to BB (low) from
B; Fitch Ratings upgraded Ford's and Ford Motor Credit's Issuer
Default Ratings to 'BB-' from 'B'; and Standard & Poor's Ratings
Services raised its corporate credit rating on Ford Motor and Ford
Motor Credit LLC to 'B+' from 'B-'. The rating agencies cited
Ford's strong financial performance and substantial debt reduction
accomplished in the second quarter of 2010.
FORD MOTOR: Reduces Stake in Mazda Motor to 3.5%
------------------------------------------------
Ford Motor Company said it will change its stake in Mazda Motor
Corporation to 3.5% from 11%. The transaction is expected to be
completed Friday.
Ford said the decision to reduce its ownership stake in Mazda
allows it to increase flexibility as it continues to pursue growth
in key emerging markets. Ford said it plans to remain one of
Mazda's largest shareholders and remains committed to its
strategic partnership with Mazda, which spans more than 30 years.
Ford and Mazda will continue to cooperate in areas of mutual
benefits such as key joint ventures and exchange of technology
information, Ford said.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
across six continents. With about 200,000 employees and about 90
plants worldwide, the company's automotive brands include Ford,
Lincoln, Mercury and Volvo. The Company provides financial
services through Ford Motor Credit Company.
Ford's balance sheet at Sept. 30, 2010, showed $177.07 billion in
total assets, $178.81 billion in total liabilities, and a
stockholders' deficit of $1.77 billion.
* * *
As reported by the Troubled Company Reporter on October 12, 2010,
Moody's Investors Service raised the Corporate Family Rating of
Ford Motor to Ba2 from B1. Other ratings that were raised include
Probability of Default to Ba2 from B1; senior secured credit
facility to Baa3 from Ba1; senior unsecured to Ba3 from B2; and,
preferred stock to B1 from B3. Moody's also raised the CFR and
senior unsecured ratings of Ford Motor Credit Company LLC, FCE
Bank Plc, and Ford Credit Canada Limited to Ba2 from Ba3. The
rating outlook for Ford and Ford Credit is stable.
Moody's said Ford's operating performance exceeded expectations
during the first half of 2010. Moody's believe that Ford is well
positioned to continue generating strong earnings and cash flow
through 2011, and to further strengthen its balance sheet. Ford's
ability to achieve this progress will be supported by the much
healthier industry fundamentals that have resulted from the
extensive restructuring of the US automotive sector during the
past two years, and by Ford's highly competitive product
portfolio.
As reported by the TCR in August 2010, Dominion Bond Rating
Service upgraded the Issuer Rating of Ford Motor to BB (low) from
B; Fitch Ratings upgraded Ford's and Ford Motor Credit's Issuer
Default Ratings to 'BB-' from 'B'; and Standard & Poor's Ratings
Services raised its corporate credit rating on Ford Motor and Ford
Motor Credit LLC to 'B+' from 'B-'. The rating agencies cited
Ford's strong financial performance and substantial debt reduction
accomplished in the second quarter of 2010.
FRED LEIGHTON: Esmerian, Charged with Fraud, Released on Bail
-------------------------------------------------------------
Patricia Hurtado at Bloomberg News reports that Ralph O. Esmerian,
the former owner of Fred Leighton Holdings Inc., was charged with
bank fraud and other crimes for allegedly pledging the same $40
million of jewels as collateral on multiple loans from Merrill
Lynch & Co. Inc. and other lenders.
According to the report, Manhattan U.S. Attorney Preet Bharara
said Mr. Esmerian, 70, borrowed $210 million against the jewels to
help finance his businesses. About $177 million was borrowed from
Merrill Lynch Mortgage Capital Inc. to buy Fred Leighton Holding
Inc., a rare antique and vintage jewelry dealer.
After borrowing the funds, began to sell collateral pledged to
Merrill without notifying the lender, according to court papers.
He also "double-pledged" the items to obtain other loans,
including $40 million from Acorn Capital Group LLC, prosecutors
said.
Bloomberg relates U.S. Magistrate Judge Theodore Katz in New York
agreed to release Mr. Esmerian on a $3.5 million bond secured by
the Manhattan apartment of his girlfriend, Bonnie Selfe.
About Fred Leighton
Fred Leighton Holding, Inc. -- http://www.fredleighton.com/-- is
a New York-based jewelry retailer owned by Ralph O. Emerian. Fred
Leighton has decked countless red-carpet-dwellers in diamonds,
including Sarah Jessica Parker, Nicole Kidman, and Catherine Zeta-
Jones.
Fred Leighton and its affiliates filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code on April 15, 2008
(Bankr. S.D.N.Y., Case No. 08-11363). Joshua Joseph Angel, Esq.,
and Frederick E. Schmidt, Esq., at Herrick, Feinstein LLP, in New
York, represent the Debtors. The Official Committee of Unsecured
Creditors has retained Michael Z. Brownstein, Esq., and Rocco A.
Cavaliere, Esq., at Blank Rome LLP, as counsel. Fred Leighton
listed total assets of $128,551,467 and total liabilities of
$134,814,367 in its schedules.
The Bankruptcy Court approved in November 2009 the sale of Fred
Leighton Holding Inc.'s business operations for $25.8 million in
cash to investors including a group of private equity firms and
estate jewelry seller Windsor Jewelers Inc.
GARIBALDI'S, INC.: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Garibaldi's, Inc.
2346 West Higgins Road
Hoffman Estates, IL 60169
Bankruptcy Case No.: 10-52394
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Susan Pierson Sonderby
Debtor's Counsel: Joseph E. Cohen, Esq.
COHEN & KROL
105 West Madison, Suite 1100
Chicago, IL 60602
Tel: (312) 368-0300
E-mail: jcohen@cohenandkrol.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/ilnb10-52394.pdf
The petition was signed by Gary Mednicov, president.
Debtor-affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Gary Mednicov 10-15645 04/08/10
GENERAL MOTORS: Asbestos Panel Wants Discovery to Estimate Claims
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors Holding Asbestos-
Related Claims in General Motors Corp.'s Chapter 11 cases seeks
the Bankruptcy Court's permission to commence discovery for
purposes of estimating the value of the Debtors' aggregate
liability for pending and future claims for asbestos-related
personal injury and wrongful death pursuant to Rule 2004 of the
Federal Rules of Bankruptcy Procedure.
The Debtors intend to file an amended Chapter 11 plan that will
provide for a trust to be established for processing,
liquidating, and paying present and future claims for asbestos-
related personal injury and wrongful death. The Debtors have
acknowledged that the Amended Plan will require estimation of
their aggregate liability for Asbestos Claims.
A reliable estimate of the Debtors' liability for Asbestos Claims
will require analysis and explication in the context of other
documentary evidence and testimony that will shed light on the
trends and patterns that shaped the Debtors' historical claims
experience and thus make possible a reasonable forecast of the
number, timing, and value of future claims expected to be
asserted over the next several decades, Trevor W. Swett III,
Esq., at Caplin & Drysdale, Chartered, in Washington, D.C.,
relates.
To that end, the Asbestos Committee wishes to examine the Debtors
and General Motors LLC and to obtain production of their
documents relevant to estimation of the Debtors' liability for
Asbestos Claims, a list of which is available for free at:
http://bankrupt.com/misc/gm_asbestoscommdocrequests.pdf
The ACC also seeks the Court's permission to issue subpoenas ad
testificandum to the Debtors and New GM. These subpoenas will
require these companies to designate individuals to testify on
their behalf regarding specified subject matters, a list of which
is available for free at:
http://bankrupt.com/misc/gm_asbestoscommsubjectmatters.pdf
Mr. Swett notes that the Official Committee of Unsecured
Creditors has represented in its Rule 2004 Motion that the
information sought from individuals with claims against certain
asbestos personal injury trusts was vital to its efforts to
prove, among other things, that GM was a "peripheral" defendant
that suffered a temporary "spike" in asbestos-related
expenditures because of the bankruptcies of those seven
"traditional" asbestos defendants. To refute the Creditors'
Committee's simplistic view, the Asbestos Committee wishes to
take third-party discovery of the same kinds of claims data and
payment information from these asbestos defendants:
* ArvinMeritor, Inc.
* BorgWarner, Inc.
* Carlisle Cos., Inc.
* Cooper Indus., Inc.
* Crane Co.
* Dana Companies, LLC
* ExxonMobil Corporation
* Ford Motor Company
* Georgia Pacific Corporation
* Goodyear Tire & Rubber Company
* Kelley Moore Paint Co., Inc.
* Pneumo-Abex LLC
* Owens-Illinois, Inc
* Tenneco Inc.
* Union Carbide Corporation
* Volkswagen Group of America, Inc.
Those defendants include manufacturers or friction products, as
well as other companies whose experience in resolving asbestos
claims may be compared and contrasted to that of Old GM, Mr.
Swett explains.
The Asbestos Committee seeks information these co-defendants
maintain in electronic form about:
(i) the plaintiffs in all asbestos personal injury cases filed
against GM before the Petition Date in which any plaintiff
alleged that he or she suffered from mesothelioma who have
brought asbestos personal injury claims against the co-
defendant;
(ii) information about the claims of the Mesothelioma
Claimants, including claim status; and
(iii) the amounts that these co-defendants have paid to settle
or otherwise resolve claims of the Mesothelioma Claimants.
This discovery would be subject to the current Confidentiality
Order and Anonymity Protocol, with appropriate modifications as
needed, Mr. Swett assures the Court.
The Asbestos Committee also seeks the Court's authority to issue
subpoenas duces tecum and ad testificandum to the GM Asbestos Co-
Defendants, a full-text copy of which is available for free at:
http://bankrupt.com/misc/gm_asbestos_codefendantsdocreqs.pdf
The Asbestos Committee also seeks the Court's permission to
serve, without further order of the Court, additional discovery
requests upon any person as the Asbestos Committee may deem
appropriate for the purposes of estimating the Debtors' aggregate
liability for Asbestos Claims, subject to the right of persons
receiving those requests to raise objections and be heard for
resolution of the same.
The Court will consider the Asbestos Committee's request on
December 2, 2010. Objections are due November 30.
Debtors and New GM Object
Counsel to the Debtors, Stephen Karotkin, Esq., at Weil, Gotshal
& Manges LLP, in New York, argues that the Asbestos Committee
fails to meet its burden of establishing good cause for the broad
discovery it seeks.
Mr. Karotkin says the Rule 2004 Motion seeks the production of 38
categories of documents and deposition from the Debtors and New
GM. However, the Debtors and New GM have provided the Asbestos
Committee all of the information necessary to estimate the
Debtors' liability for Asbestos Personal Injury Claims, he points
out. The Debtors and New GM have provided this information
pursuant to a written agreement with the Asbestos Committee and
orders of the Court specifying detailed discovery and
confidentiality protocols, he states. At best, the Rule 2004
Motion fails to state a legitimate need for the further discovery
it seeks, and, much of what it seeks from the Debtors has already
been produced, he insists.
Mr. Karotkin further notes that all of the retained experts in
the Debtors' Chapter 11 cases have all of the information they
need to conduct an estimation of the Debtors' liability for
Asbestos Personal Injury Claims. Under these circumstances, the
only logical assumption is that the Rule 2004 Motion is designed
to delay the administration of these Chapter 11 cases to obtain
some leverage in the process, he contends. This should not be
sanctioned by the Court, and the Debtors' estates should be
spared the unwarranted cost and delay that necessarily will be
attendant to the broad discovery sought in the Rule 2004 Motion,
he tells the Court.
Mr. Karotkin also argues that the Rule 2004 Motion is
procedurally improper. To the extent any further discovery
regarding estimation is at all appropriate, it should be
requested pursuant to the applicable Federal Rules of Civil
Procedure and the terms of the Debtors' Motion to Estimate
Asbestos Liability, he asserts.
In connection with the Debtors' Objection, counsel to New GM,
Joseph R. Sgroi, Esq., at Honigman Miller Schwartz and Cohn LLP,
in Detroit, Michigan -- jsgroi@honigman.com --- insists that the
documents and information already produced by New GM and the
Debtors under various agreements with the Asbestos Committee and
pursuant to certain orders of the Court, have provided the
Asbestos Committee with all of the information necessary to
complete the estimation of the Asbestos Personal Injury Claims.
Mr. Sgroi argues that the additional information sought by the
Asbestos Committee will provide little benefit in connection with
the estimation proceeding. In fact, the additional discovery
sought by the Asbestos Committee far exceeds the breadth and
detail of discovery sought when the Debtors were actually
litigating their asbestos-related claims, he asserts. He
emphasizes that locating, organizing and reviewing documents
potentially responsive to the Asbestos Committee would require a
monumental undertaking by New GM, spanning nearly every
organization in the company. New GM estimates that it would be
required to spend at a minimum hundreds of work-hours to respond,
he states.
The minimal benefit the Asbestos Committee could derive from the
proposed additional discovery is overshadowed by the significant
costs and burdens to New GM in responding to the Asbestos
Committee's requests, Mr. Sgroi maintains.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company -- http://www.gm.com/-- is one of the world's largest
automakers. GM employs 205,000 people in every major region of
the world and does business in some 157 countries. GM and its
strategic partners produce cars and trucks in 31 countries, and
sell and service these vehicles through the following brands:
Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang,
Opel, Vauxhall and Wuling. GM's largest national market is China,
followed by the United States, Brazil, Germany, the United
Kingdom, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. is 60.8% owned by the U.S. Government. It was
formed to acquire the operations of General Motors Corporation
through a sale under 11 U.S.C. Sec. 363 following Old GM's
bankruptcy filing. The deal was closed on July 10, 2009, and Old
GM changed its name to Motors Liquidation Co. Old GM remains
subject to a pending Chapter 11 reorganization case before the
U.S. Bankruptcy Court for the Southern District of New York.
At June 30, 2010, GM had US$131.899 billion in total assets,
US$101.00 billion in total liabilities, US$6.998 billion in
preferred stock, and US$23.901 billion in stockholders' equity.
New GM has a 'BB-' corporate credit rating from Standard & Poor's
and a 'BB-' issuer default rating from Fitch.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM is
also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP serve as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long serve as counsel regarding
supplier contract matters. FTI Consulting, Inc., serves as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represents the Asbestos
Committee. Legal Analysis Systems, Inc., serves as asbestos
valuation analyst.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: Old GM Plan Outline Hearing Rescheduled to Dec. 2
-----------------------------------------------------------------
Judge Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York rescheduled a hearing on the
adequacy of the Disclosure Statement explaining the Joint Chapter
11 Plan of Reorganization of Motors Liquidation Company and its
debtor affiliates to December 2, 2010, Tiffany Kary of Bloomberg
News reported on November 22, 2010.
The adjournment comes as the U.S. Government and creditors failed
to agree on the budget for the trusts in the wind-down of the
former automaker, Ms. Kary related.
Judge Gerber conditionally approved the Disclosure Statement on
October 21, 2010, pending certain amendments to be made to the
Disclosure Statement. According to a notice filed with the Court,
Judge Gerber continued the hearing on the Disclosure Statement
until November 22. The notices revealed that the matter is going
forward as a status conference only.
At the November 22 hearing, Thomas Moers Mayer, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, counsel to the Official
Committee of Unsecured Creditors, told Judge Gerber that the
creditors and the U.S. Department of the Treasury also could not
agree on several other issues, Bloomberg relates.
"If we can't reach an agreement on Dec. 2 or shortly thereafter,
we will ask your honor for court time in January to deal with
issues of principle," Mr. Mayer stated.
In other concerns, the report related that creditors agreed to
limit their probe of asbestos data to Motors Liquidation and
General Motors LLC, or "New GM."
"This effort to move the asbestos wars into my courtroom and fight
agendas here has the result of delaying distribution to literally
thousands of innocent creditors," Bloomberg quoted Judge Gerber as
saying at the November 22 hearing.
The Debtors' counsel, Stephen Karotkin, Esq., at Weil, Gotshal &
Manges LLP, in New York, told the Court that thousands of dollars
for the Debtors' estates' wind-down budget has already been spent
on disputes over how to protect the identity of individuals in the
asbestos probe. Bloomberg noted that the U.S. and Canada
Governments set aside a wind-down budget for the Debtors as part
of a plan that repays their loans to GM.
The pace of talks with creditors is frustrating, David Jones,
Esq., a lawyer for the U.S. Government, commented, Bloomberg
noted. According to Mr. Karotkin, the chief sticking point was
the budget for a trust that would distribute stock and warrants in
New GM to creditors, Bloomberg stated.
Ms. Kary said other trusts in the wind-down include one to set
aside $773 million to resolve Old GM's environmental liabilities
to the federal government and certain states. Ms. Kary further
related that GM intends to set up a trust to pay tort claims.
She noted that while GM estimated asbestos liability to be at
$648 million, the Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims believes that the liability could
be five to 10 times as much.
"Why don't you guys redouble your efforts to put these issues to
bed," Judge Gerber told the lawyers at the November 22 hearing,
Bloomberg added.
The Chapter 11 Plan
Motors Liquidation Company, formerly General Motors Corporation;
MLC of Harlem, Inc.; MLCS, LLC; MLCS Distribution Corporation;
Remediation and Liability Management Company, Inc.; and
Environmental Corporate Remediation Company, Inc., delivered on
August 31 to Judge Robert Gerber of the U.S. Bankruptcy Court for
the Southern District of New York their Joint Chapter 11 Plan of
Reorganization and a Disclosure Statement explaining the Plan.
The Plan, provides a framework for the environmental remediation
of the remaining "Old GM" properties and the distribution of "New
GM" stock and warrants to unsecured creditors.
If the Plan is confirmed, substantially all of the Debtors' assets
and liabilities will be transferred to four trusts:
(1) the Environmental Remediation Trust, or "ERT," that
provides funds for the continuing environmental
remediation of the Debtors' remaining properties;
(2) the General Unsecured Creditors Trust, that will be
responsible for resolving the outstanding claims of the
Debtors' unsecured creditors and distributing the General
Motors Company common stock and warrants owned by MLC to
those unsecured creditors whose claims are allowed;
(3) the Asbestos Trust that will handle both present and
future asbestos-related claims against the Debtors; and
(4) the Avoidance Action Trust that will deal with certain
litigation-related claims of the Debtors.
MLC presently owns 10% of General Motors' common stock, plus
warrants that are exercisable for a further 15% of General Motors'
common stock on a fully diluted basis. MLC will be issued up to
an additional 2% of General Motors' common stock if the final
estimated aggregate amount of the Debtors' unsecured claims
exceeds certain thresholds.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company -- http://www.gm.com/-- is one of the world's largest
automakers. GM employs 205,000 people in every major region of
the world and does business in some 157 countries. GM and its
strategic partners produce cars and trucks in 31 countries, and
sell and service these vehicles through the following brands:
Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang,
Opel, Vauxhall and Wuling. GM's largest national market is China,
followed by the United States, Brazil, Germany, the United
Kingdom, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. is 60.8% owned by the U.S. Government. It was
formed to acquire the operations of General Motors Corporation
through a sale under 11 U.S.C. Sec. 363 following Old GM's
bankruptcy filing. The deal was closed on July 10, 2009, and Old
GM changed its name to Motors Liquidation Co. Old GM remains
subject to a pending Chapter 11 reorganization case before the
U.S. Bankruptcy Court for the Southern District of New York.
At June 30, 2010, GM had US$131.899 billion in total assets,
US$101.00 billion in total liabilities, US$6.998 billion in
preferred stock, and US$23.901 billion in stockholders' equity.
New GM has a 'BB-' corporate credit rating from Standard & Poor's
and a 'BB-' issuer default rating from Fitch.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM is
also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP serve as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long serve as counsel regarding
supplier contract matters. FTI Consulting, Inc., serves as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represents the Asbestos
Committee. Legal Analysis Systems, Inc., serves as asbestos
valuation analyst.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: New GM IPO Proceeds Add $11.7 Bil. to TARP Funds
----------------------------------------------------------------
The U.S. Government says taxpayers recovered more than
$250 billion from funds used to bail out companies with the
proceeds of the initial public offering of General Motors Co., Dow
Jones Newswires reported.
The report said the U.S. Department of the Treasury updated its
recovery of Troubled Asset Program funds with the formal
announcement of the delivery of $11.7 billion in net proceeds from
the GM IPO.
The U.S. Government extended a total of $49.5 billion loans to GM
to usher the carmaker through bankruptcy reorganization. The
report noted that the taxpayer funds, provided under the TARP, are
credited by government officials with saving the company from
collapse and guiding through a quick bankruptcy restructuring that
ended in 2009.
The Treasury, according to the report, said with the GM proceeds,
there has been $252 billion in TARP funds returned to taxpayers.
A report from The Detroit News related that U.S. President Obama
and the Treasury's Secretary Timothy Geithner praised the GM IPO
but sidestepped the government's losses on its larger-than-
expected sale of GM common stock.
The Detroit News noted that the Treasury will sell up to 45% or
412 million shares of its holdings. The Treasury previously sold
358 million shares of GM common stock, priced at $33 per share --
incurring a $3.8 billion loss, the report disclosed. For the
government to break even on the $49.5 billion GM bailout, it must
sell the remaining shares at least $50 per each, the report said.
The Detroit News further reported that senior administration
officers will continue to monitor GM "albeit at a somewhat reduced
level." "The Treasury -- which has been actively engaged for
months in determining how many shares to sell will return to its
pre-IPO mode," the report added.
In a separate report, Bill Vlasic and Michael J. de la Merced of
The New York Times related that the three days before the actual
IPO, the Treasury had a hard time deciding on the price of its
shares of GM common stock to be sold at the IPO.
The NY Times recalled that James B. Lee Jr. of JPMorgan Chase, a
senior GM advisor and other bankers from Morgan Stanley, told Ron
Bloom of the Treasury that there was a huge demand from investors
-- more than $150 billion worth of orders at that point. The
bankers wanted to increase the IPO price to as high as $33, an
increase from the previously estimated $26 to $29 per share, NY
Times noted.
The newspaper added that while that's good news for taxpayers who
will get a more payback, a higher offering price risked driving
some potential investors away from the offering. The report
further noted that the shares would tank soon after their debut.
For Mr. Bloom, the decision over the IPO price was a gamble that
could define the success or failure of the government's
$49.5 billion bailout, NY Times noted.
"Keeping it at the low end would not give us a fair price," Mr.
Bloom told the NY Times. "So we coalesced at $32 to $33," Mr.
Bloom added.
What began in the spring as cautious discussions under the code
name Project Dawn would become on November 18 a $23.1 billion
stock offering, the NY Times said.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company -- http://www.gm.com/-- is one of the world's largest
automakers. GM employs 205,000 people in every major region of
the world and does business in some 157 countries. GM and its
strategic partners produce cars and trucks in 31 countries, and
sell and service these vehicles through the following brands:
Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang,
Opel, Vauxhall and Wuling. GM's largest national market is China,
followed by the United States, Brazil, Germany, the United
Kingdom, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. is 60.8% owned by the U.S. Government. It was
formed to acquire the operations of General Motors Corporation
through a sale under 11 U.S.C. Sec. 363 following Old GM's
bankruptcy filing. The deal was closed on July 10, 2009, and Old
GM changed its name to Motors Liquidation Co. Old GM remains
subject to a pending Chapter 11 reorganization case before the
U.S. Bankruptcy Court for the Southern District of New York.
At June 30, 2010, GM had US$131.899 billion in total assets,
US$101.00 billion in total liabilities, US$6.998 billion in
preferred stock, and US$23.901 billion in stockholders' equity.
New GM has a 'BB-' corporate credit rating from Standard & Poor's
and a 'BB-' issuer default rating from Fitch.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM is
also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP serve as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long serve as counsel regarding
supplier contract matters. FTI Consulting, Inc., serves as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represents the Asbestos
Committee. Legal Analysis Systems, Inc., serves as asbestos
valuation analyst.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: New GM Raises $20.1 Billion From IPO
----------------------------------------------------
General Motors Inc. raised an estimated $20.1 billion at the
automaker's initial public offering on November 18, 2010, at the
New York Stock Exchange. The IPO, according a company statement,
is the largest U.S. IPO of 2010 and amongst the largest in
history.
To mark the occasion, the company statement related that GM Chief
Executive Officer Dan Akerson rang The NYSE Opening Bell with the
sound of the horn of its 2011 Chevrolet Camaro SS model.
GM also announced the pricing of the public offering of common
stock and mandatory convertible junior preferred stock on
November 17. GM said it expects the total offering size to be
$20.1 billion or $23.1 billion if the underwriters' over-allotment
options are fully-exercised.
The issue included 478 million shares of common stock, for a total
of $15.77 billion, and 87 million shares of mandatory convertible
junior preferred stock, for a total of $4.35 billion. The
underwriters have a 30-day option to purchase up to 71.7 million
additional shares of common stock from the selling stockholders,
for a total of $2.37 billion, and an additional 13 million shares
of mandatory convertible junior preferred stock from the company
on the same terms and conditions, for a total of $650 million, to
cover over-allotments, if any.
The common stock has been priced at $33.00 per share. On the
mandatory conversion date, December 1, 2013, each share of
mandatory convertible junior preferred stock, unless previously
converted, will automatically convert into shares of common stock.
The Series B mandatory convertible junior preferred stock will
have a 4.75% dividend rate and a liquidation preference of $50 per
share.
In a November 16 statement, GM said it increased the estimated
price range for the IPO of 365 million shares of common stock to
be sold by certain of its stockholders to $32.00 to $33.00 per
share from the previously estimated price range of $26.00 to
$29.00 per share. The company also said it has increased the
proposed size of its Series B mandatory convertible junior
preferred stock offering from $3 billion to $4 billion, consisting
of 80 million shares, excluding the amount that the underwriters
have the option to purchase to cover over-allotments, if any.
GM's common stock began trading on November 18, 2010, on the NYSE
under the ticker symbol "GM" and on the Toronto Stock Exchange
under the symbol "GMM."
The mandatory convertible junior preferred stock began trading on
November 18, 2010, subject to official notice of issuance, on the
New York Stock Exchange under the symbol "GM Pr B."
The common stock and preferred stock offerings are expected to
close on November 23, 2010. The closing of the mandatory
convertible junior preferred stock offering is conditional upon
the closing of the offering for GM's common stock.
A registration statement relating to these securities was declared
effective by the U.s. Securities and Exchange Commission on
November 17.
Morgan Stanley and J.P. Morgan, as representatives of the
underwriters, Bank of America Corp., Merrill Lynch, Pierce, Fenner
& Smith Incorporated, Citicorp, Goldman, Sachs & Co., Barclays
Capital, Credit Suisse, Deutsche Bank Securities and RBC Capital
Markets will be the joint book-running managers for the IPO.
IPO Could Reach $22.1 Bil.
Although the final value of the GM IPO is undetermined for now,
strong demand clauses could send it beyond $22.1 billion, the
current record set by the initial public offering of Agricultural
Bank of China in July of this year, The Associated Press reported.
"It seems as if investors are viewing the auto stocks as a one-way
bet right now because they think that the industry is at the
bottom of the cycle and there is a lot of promise," Jeremy Anwyl,
head of automotive site Edmunds.com told AP. However, Mr. Anwyl
cautioned that several significant risks remain, AP noted. Among
other things, Mr. Anwyl pointed out that GM's management is still
untested and the company's track record of profitability is
anything but long, AP related.
Mr. Anwyl further told AP that Europe is also a trouble spot
because of its weak economy, especially since GM has not yet
tackled meaningful restructuring there to address overcapacity,
labor costs and the limited growth inherent in a mature market.
AP also noted that GM is not expected to regain the title of top-
selling global automaker which it lost to Toyota in 2008. Despite
that, GM stands to gain from its spectacular growth in China,
where it sells more vehicles than in the U.S. through its
partnership with Shanghai Automotive Industry Corporation, the
report added.
A separate related report from Bloomberg News noted that the IPO
may boost GM's image to vehicle buyers, citing Moody's Investors
Service. Moody's Analyst Bruce Clark wrote in a research note,
that "U.S. consumers who don't know about over-allocation options
or the need for strong liquidity knew that something exceptionally
good has happened to GM last week." Mr. Clark further noted that
that knowledge makes it more likely that they will consider buying
a GM car and possibly buy one, Bloomberg related.
Trading of GM Common Stock Remains Volatile
Trading of General Motors Company's common stock gyrated between
positive and negative territory on November 22, 2010 to close at a
loss as it started its first full week of trading as a reborn
company, Tom Krisher of The Associated Press reported.
According to analysts, the stock movement is a combination of
hedge funds taking profits and other investors jumping in as the
price dips, and they expect volatility to last for several more
days, Mr. Krisher related.
Mr. Krisher noted that the GM Common Stock closed on November 22,
2010, at $34.08, down 18 cents per share, or 0.5%. He continued
that the GM Common Stock dropped as much as 45 cents to $33.81 in
the morning of November 22, but it rebounded to a gain and
continued to move above and below break-even all day. He also
observed that at one point, the GM Common Stock hit 22 cents above
November 18's close of $34.26. Volume was around 36 million
shares, far below from the 400 million, trades in the GM Common
Stock on November 18, he added.
The stock movement comes just two days after GM pulled off an IPO
worth $15.8 billion, signaling the surprising resurrection of an
American corporate icon that collapsed into bankruptcy protection
and was rescued with a $50 billion bailout from the U.S.
taxpayers, Mr. Krisher commented.
Volatility will likely continue for at least a few more days
because stock markets have been unstable of late and as hedge
funds continue to take profits and other traders search for
bargains, Joe Phillippi, president of New Jersey-based AutoTrends
Consulting, told AP. Mr. Phillippi continued that investors could
be buying with the expectation of a pop in the price because GM
should make its way back into the Standard & Poor's 500 index
shortly, the report added. Mr. Krisher explained that membership
in the S&P index is important because many mutual funds buy shares
based on it.
Mr. Krisher further noted that trading on November 22 was similar
to but not as dramatic as November 19's trading. At the opening
bell on November 19, the stock fell $1.08 to $33.11 as investors
sold to lock in profits, he related. The stock recovered after
nearing the IPO price of $33 per share, leading some analysts to
speculate that large investors stepped in to stop it from hitting
$33, a price that could trigger computerized "stop loss" orders to
sell, he pointed out. Analysts said November 19's early drop also
could have been halted by investors who jumped in to buy at a
relatively low price, he related. It ended November 19 up 7
cents, or 0.2 percent, at $34.26, he added.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company -- http://www.gm.com/-- is one of the world's largest
automakers. GM employs 205,000 people in every major region of
the world and does business in some 157 countries. GM and its
strategic partners produce cars and trucks in 31 countries, and
sell and service these vehicles through the following brands:
Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang,
Opel, Vauxhall and Wuling. GM's largest national market is China,
followed by the United States, Brazil, Germany, the United
Kingdom, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. is 60.8% owned by the U.S. Government. It was
formed to acquire the operations of General Motors Corporation
through a sale under 11 U.S.C. Sec. 363 following Old GM's
bankruptcy filing. The deal was closed on July 10, 2009, and Old
GM changed its name to Motors Liquidation Co. Old GM remains
subject to a pending Chapter 11 reorganization case before the
U.S. Bankruptcy Court for the Southern District of New York.
At June 30, 2010, GM had US$131.899 billion in total assets,
US$101.00 billion in total liabilities, US$6.998 billion in
preferred stock, and US$23.901 billion in stockholders' equity.
New GM has a 'BB-' corporate credit rating from Standard & Poor's
and a 'BB-' issuer default rating from Fitch.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM is
also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP serve as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long serve as counsel regarding
supplier contract matters. FTI Consulting, Inc., serves as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represents the Asbestos
Committee. Legal Analysis Systems, Inc., serves as asbestos
valuation analyst.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: Saudi Prince Pledges $500 Mil. in IPO
-----------------------------------------------------
Kingdom Holding Co. disclosed that the firm and its chairman
Saudi Arabia's billionaire Prince Alwaleed Bin Talal subscribed
$500 million toward General Motors Company's initial public
offering, Summer Said of Dow Jones Newswires reports.
Kingdom Holding said in an e-mailed statement that the transaction
represents 1% of the value of GM subscriptions, Ms. Said notes.
"The decision of Kingdom Holding and Prince Alwaleed to invest in
GM was based on the global strength of the General Motors brand,
the relatively attractive offering price, and the company's growth
prospects in Brazil and China, Ms. Said quotes from the e-mailed
statement.
GENERAL MOTORS: Seeks Estimation of Asbestos Claim Liability
------------------------------------------------------------
General Motors Corp., now known as Motors Liquidation Co., and its
affiliates ask the Bankruptcy Court to estimate their aggregate
liability with respect to all present and future asbestos-related
personal injury claims within a proposed timeline.
About 28,500 Asbestos PI Claims were filed against the Debtors.
Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, in New
York, tells the Court that estimating the Debtors' aggregate
liability for Asbestos PI Claims is required pursuant to an
amended plan the Debtors to be filed with the Court. Pursuant to
that Amended Plan, an "Asbestos Trust Claim" determines the
appropriate ratable distribution to be made to a post-confirmation
trust to which all Asbestos Personal Injury Claims will be
channeled.
The Asbestos Trust Claim is the claim in the amount of the
Debtors' aggregate liability for Asbestos Personal Injury Claims
in an amount that is either:
(i) mutually agreed upon by the Debtors, the Official
Committee of Unsecured Creditors, the Official Committee
of Unsecured Creditors Holding Asbestos Personal Injury
Claims, and Dean Trafelet, the Legal Representative for
Future Asbestos Claimants; or
(ii) ordered by the Court.
The Asbestos Trust will, among other things, (i) direct the
processing, liquidation, and payment of all Asbestos Personal
Injury Claims in accordance with the Plan and the Asbestos Trust
Distribution Procedures; and (ii) preserve, hold, manage, and
maximize the assets of the Asbestos Trust for use in paying and
satisfying Asbestos Personal Injury Claims.
In anticipation of the request for an estimation proceeding, the
parties have retained professionals to estimate the Debtors'
liability for Asbestos Personal Injury Claims. Specifically, the
Debtors have retained Hamilton, Rabinovitz, & Associates, Inc.;
the Creditors' Committee has retained Bates White, LLC; the
Asbestos Committee has retained Legal Analysis Systems, Inc.; and
the FCR has retained Analysis Research Planning Corporation.
Mr. Smolinsky says that while the Debtors have been hopeful that
the aggregate allowed amount of the Asbestos Personal Injury
Claims could be set through negotiations among the relevant
parties, these ongoing discussions have not resulted in a
settlement. As the Debtors move closer to confirming the Plan,
the estimation of aggregate liability for Asbestos Personal
Injury Claims is imperative to assure the efficient and
expeditious administration of the Debtors' estates, he stresses.
Against this backdrop, the Debtors propose these procedures and
schedule for the asbestos estimation proceeding:
(a) The parties will each be permitted one asbestos expert.
(b) All fact discovery demands will be served by
December 6, 2010, all responses in connection with any
fact discovery demands will be filed by December 24, 2010,
and all fact depositions will be completed by
December 31, 2010.
(c) The parties will file and serve opening expert reports
regarding the estimated amount of the Debtors' aggregate
liability for Asbestos PI Claims by January 11, 2011.
(d) The parties will file and serve rebuttal reports regarding
the estimated amount of the Debtors' aggregate liability
for Asbestos PI Claims by January 21, 2011.
(e) Each party will make its expert available to be deposed,
with depositions to be completed by January 31, 2011.
(f) Any pre-trial briefs shall be filed by February 8, 2011.
(g) The parties will exchange copies of all exhibits to be
offered at the hearing on the estimation of the Debtors'
aggregate liability for Asbestos PI Claims and provide
copies of any of those exhibits to the Court five days
before the commencement of the estimation hearing.
(h) The Debtors will schedule a hearing to estimate their
aggregate liability for Asbestos PI Claims for the
purposes of the Plan, which they propose to be a date in
mid- to late February 2011.
Section 502(c) of the Bankruptcy Code authorizes the Court to
estimate "any contingent or unliquidated claim, the fixing or
liquidation of which, as the case may be, would unduly delay the
administration of the case."
Specifically, by estimating the Debtors' aggregate liability for
Asbestos Personal Injury Claims, the Court will not be
determining the distribution to be made under the Plan to each
individual holder of an Asbestos Personal Injury Claim, and each
holder will be free to liquidate the ultimate allowance of his or
her claim following confirmation of the Plan in accordance with
the Asbestos Trust Distribution Procedures, Mr. Smolinsky
asserts. To the extent that the aggregate liability for Asbestos
Personal Injury Claims has not been estimated, appropriate
ratable shares cannot be determined and distributions to holders
of allowed claims cannot be made, he stresses. To avoid undue
delay in distributions under the Amended Plan, estimation of the
liability is of paramount importance, he insists.
"The estimation is the only rational and logical way to proceed
and will not prejudice any party in interest," Mr. Smolinsky
maintains.
The Court will consider the Debtors' request on December 2, 2010.
Objections are due November 24.
Asbestos Committee Comments
The Asbestos Committee agrees that a contested proceeding for the
estimation of the Debtors' aggregate liability for Asbestos
Personal Injury Claims should commence.
Trevor W. Swett III, Esq., at Caplin & Drysdale, Chartered, in
Washington, D.C., relates that the parties in the Debtors' Chapter
11 cases have engaged in limited informal discovery to prepare for
estimation. He notes that the Asbestos Committee is evaluating
the extent to which formal discovery may be needed. Based on
three key assumptions, the Asbestos Committee does not anticipate
the estimation of the Asbestos Personal Injury Claims to be
extensive or inordinately time-consuming. Those key assumptions,
he says, are:
(a) that the parties will not litigate in these Chapter 11
cases issues going to the merits of asbestos claims
against General Motors, including contentions that
chrysotile asbestos does not cause mesothelioma or that
the asbestos contained in friction products does not emit
sufficient asbestos fibers to cause disease;
(b) that neither the Debtors nor the Creditors' Committee will
take positions or raise issues that would fairly require
the Debtors to waive otherwise applicable privileges or
the Court to deem those privileges waived or pierced; and
(c) that the UCC's Rule 2004 application is withdrawn or
reconsidered and overruled and the related subpoenas to
settlement trusts withdrawn or quashed, which in turn will
enable the Asbestos Committee to withdraw its Rule 2004
request for correlative discovery aimed at solvent
asbestos defendants unrelated to the Debtors or to General
Motors LLC.
If those assumptions are sound, the Asbestos Committee
anticipates that its needs for formal fact discovery will be
narrow, targeted, and limited, Mr. Swett states. He further
notes that the Asbestos Committee will confer with the Debtors,
the Creditors' Committee, and the FCR to arrive at a joint
scheduling proposal for presentation to the Court. The Asbestos
Committee expects that a key issue will be the provision of
adequate time for the experts to prepare rebuttal reports to
whatever analyses put forward by the Creditors' Committee and the
FCR from a sample of 650 asbestos litigation files from General
Motors' defense attorneys.
Subject to those assumptions, the schedule for that proceeding
should be expeditious but must not sacrifice considerations of
fundamental fairness, the Asbestos Committee tells the Court.
FCR Opposes Proposed Schedule
The FCR agrees that it is appropriate to achieve a reliable
estimate of the Debtors' aggregate liability for the Asbestos
Personal Injury Claims. However, the FCR complains that the
Debtors' proposed scheduling order is completely unrealistic and
violates its due process right to be heard in a meaningful manner.
Even a cursory analysis of the Debtors' proposed schedule reveals
that its primary purpose is not to facilitate a reliable estimate
of the Debtors' aggregate current and future asbestos liability,
but instead to prevent the FCR's expert, Analysis, Research &
Planning Corporation, from fully and fairly analyzing the true
extent of the Debtors' aggregate asbestos liabilities, Sander L.
Esserman, Esq., at Stutzman, Bromberg Esserman & Plifka, in
Dallas, Texas, stresses. For one, the Debtors propose a
truncated, fast track schedule that gives ARPC little or no time
for written discovery and limits ARPC's ability to properly
evaluate the data that the Debtors and New GM are still providing
in response to the FCR's requests under Rule 2004 of the Federal
Rules of Bankruptcy Procedure that were served in July 2010, he
points out.
"The Debtors cannot be permitted to run roughshod over the due
process and fundamental fairness rights of the FCR and the other
parties to the estimation proceedings," Mr. Esserman maintains.
The FCR thus asks the Court to deny the Debtors' proposed
schedule.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company -- http://www.gm.com/-- is one of the world's largest
automakers. GM employs 205,000 people in every major region of
the world and does business in some 157 countries. GM and its
strategic partners produce cars and trucks in 31 countries, and
sell and service these vehicles through the following brands:
Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang,
Opel, Vauxhall and Wuling. GM's largest national market is China,
followed by the United States, Brazil, Germany, the United
Kingdom, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. is 60.8% owned by the U.S. Government. It was
formed to acquire the operations of General Motors Corporation
through a sale under 11 U.S.C. Sec. 363 following Old GM's
bankruptcy filing. The deal was closed on July 10, 2009, and Old
GM changed its name to Motors Liquidation Co. Old GM remains
subject to a pending Chapter 11 reorganization case before the
U.S. Bankruptcy Court for the Southern District of New York.
At June 30, 2010, GM had US$131.899 billion in total assets,
US$101.00 billion in total liabilities, US$6.998 billion in
preferred stock, and US$23.901 billion in stockholders' equity.
New GM has a 'BB-' corporate credit rating from Standard & Poor's
and a 'BB-' issuer default rating from Fitch.
About Motors Liquidation
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq.,
and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP,
assist the Debtors in their restructuring efforts. Al Koch at AP
Services, LLC, an affiliate of AlixPartners, LLP, serves as the
Chief Executive Officer for Motors Liquidation Company. GM is
also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is
providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured Creditors
Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis
& Frankel LLP serve as bankruptcy counsel to the Creditors
Committee. Attorneys at Butzel Long serve as counsel regarding
supplier contract matters. FTI Consulting, Inc., serves as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represents the Asbestos
Committee. Legal Analysis Systems, Inc., serves as asbestos
valuation analyst.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GEOS COMMUNICATIONS: Posts $2.6 Million Net Loss in Q3 2010
-----------------------------------------------------------
Geos Communications, Inc., filed its quarterly report on Form
10-Q, reporting a net loss of $2.58 million on $31,992 of revenue
for the three months ended September 30, 2010, compared with a net
loss of $4.17 million on $0 revenue for the corresponding period
last year.
The Company has an accumulated deficit of $67.58 million as of
September 30, 2010.
The Company's balance sheet at September 30, 2010, showed
$6.82 million in total assets, $18.80 million in total
liabilities, $5.56 in convertible preferred shares, and a
stockholders' deficit of $17.54 million.
"The Company has not generated positive cash flows from operations
and has accumulated losses since inception, which raises
substantial doubt about its ability to continue as a going
concern," the Company said in the filing.
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?6fa0
Southlake, Tex.-based Geos Communications, Inc., is a developer
and distributor of mobile applications and services. On June 17,
2010, the Company's board of directors approved a plan by which
the Company discontinued offering its VoIP and telephony services
directly to consumer and enterprise customers. Under the plan the
Company implemented a reduction-in-force and closed its network
switching operations located in Atlanta, Georgia. The Company is
in negotiations for the sale of its telephony network assets.
On February 19, 2010, the Company acquired Shoot It!, LLC, which
expanded the Company's product portfolio applications and
technologies for the global mobile communications market. On
March 1, 2010, the Company acquired D Mobile, Inc., which provides
the Company with a platform for mobile content distribution in
China, the world's largest mobile communications market, and
expands the Company's global presence. D Mobile, which operates
under the brand name Duo Guo, is a retail channel for the
discovery and download of licensed mobile media content in China.
GOODYEAR TIRE: S&P Gives Stable Outlook, Affirms 'BB-' Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services said it has revised its outlook
on The Goodyear Tire & Rubber Co. to stable from negative and
affirmed all its ratings on the company, including the 'BB-'
corporate credit rating.
"The outlook revision is based on S&P's expectations that
Goodyear's credit measures will continue to show steady
improvement during 2011," said Standard & Poor's credit analyst
Lawrence Orlowski. Consumer and commercial tire demand around the
world has boosted Goodyear's sales and profits in 2010. The
company has been able to raise tire prices and more than offset
volatile raw material prices. Moreover, the company continues to
rationalize its operations and is benefiting from lower unabsorbed
fixed costs as utilization increases at its manufacturing
facilities. S&P expects Goodyear to use discretionary cash flow
in 2010 and 2011 but not to exceed $200 million in 2011.
In the third quarter, sales rose 13% year over year because of an
increase in global tire demand, a better price mix, and higher
sales in other tire-related businesses. The commercial tire
business showed double-digit growth in North America and in
Europe, the Middle East, and Africa. Furthermore, higher
production contributed to better manufacturing utilization and
therefore lower unabsorbed fixed costs.
The company aims to lower manufacturing capacity by 15 million to
25 million units by early 2011 and has already announced plans to
reduce capacity by about 8 million units. S&P expects Goodyear to
realize cost savings of about $350 million in 2010 and about
$650 million during the next two years. S&P believes many costs
will be lower as a result, even if commodity price increases
offset some of the savings.
The ratings on Goodyear reflect S&P's opinion that Goodyear's
financial risk profile is aggressive, as characterized by weak
earnings in North America and substantial debt. S&P believes the
company's business risk profile is fair, reflecting tough tire
industry conditions globally and S&P's view of the company's high
fixed-cost structure. These factors offset the company's business
strengths, which include its position as one of the three largest
tire manufacturers in the world, good geographic diversity, strong
distribution channels, and a well-recognized brand name.
In S&P's view, Goodyear has adequate liquidity under its criteria.
Liquidity as of Sept. 30, 2010, consisted of about $1.7 billion in
cash and $2.4 billion available under long-term credit facilities.
S&P estimates that the company requires about $1 billion for
seasonal working-capital expansion, which normally peaks during
the third quarter. S&P expects capital expenditures to increase
to $1 billion to $1.1 billion as Goodyear modernizes existing
manufacturing facilities and expands production capacity in Latin
America and China.
The outlook is stable. S&P expects consumer and commercial tire
demand around the world to continue boosting Goodyear's sales and
profits in 2011 and 2012. The company has been able to raise tire
prices and more than offset the increase in raw material prices.
Moreover, the company continues to rationalize its operations.
Consequently, S&P expects key credit measures to continue
improving, even if discretionary cash flow is negative in 2010 and
possibly 2011. S&P could raise the ratings if the company began
generating strong free operating cash flow and its adjusted debt
to EBITDA fell below 3.5x on a sustained basis. This could occur
if revenue grows more than 15% and gross margins exceed 20% in
2011.
S&P assumes the company will use significant free cash flow for
the next year or more because of higher capital expenditures and
rising pension contributions. S&P could lower the ratings if the
company uses more than $200 million in free cash flow in 2011.
Moreover, for the current rating, S&P expects adjusted debt to
EBITDA to fall to about 4x on a sustained basis. This could occur
if, for instance, revenue grew above 15% and gross margins rose
19% in 2011. As evidence the company was making progress toward
this goal, S&P would expect its leverage to fall below 5x by the
end of 2011.
GREEN PLANET: Posts $2.9 Million Net Loss in September 30 Quarter
-----------------------------------------------------------------
Green Planet Group, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $2.87 million on $10.31 million of revenue
for the three months ended September 30, 2010, compared with a net
loss of $1.55 million on $16.41 million of revenue for the three
months ended September 30, 2009.
The Company has an accumulated deficit of $41.12 million and a
working capital deficit of $16.79 million as of September 30,
2010.
The Company's balance sheet at September 30, 2010, showed
$13.93 million in total assets, $38.66 million in total
liabilities, and a stockholders' deficit of $24.73 million.
As reported in the Troubled Company Reporter on July 20, 2010,
Semple, Marchal & Cooper, LLP, in Phoenix, Ariz., expressed
substantial doubt about the Company's ability to continue as a
going concern, following the Company's results for the fiscal year
ended March 31, 2010. The independent auditors noted that the
Company has significant operating losses and negative working
capital.
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?6fbe
About Green Planet
Scottsdale, Ariz.-based Green Planet Group, Inc. (OTC BB: GNPG)
-- http://www.greenplanetgroup.com/-- is engaged in the
research, development, manufacturing and distribution of a variety
of products that improve overall energy efficiency with a specific
concentration on petroleum based energy sources. The Company
currently has four wholly owned operating subsidiaries, EMTA Corp,
XenTx Lubricants, Inc., White Sands, L.L.C., and Lumea, Inc.
GROUP 1: S&P Raises Corporate Credit Rating to 'BB-'
----------------------------------------------------
Standard & Poor's Ratings Services said it has raised its
corporate credit rating on Houston, Texas-based Group 1 Automotive
Inc. to 'BB-' from 'B+'. The outlook is stable.
At the same time, S&P raised the issue-level ratings on the
company's debt issues.
"The upgrade reflects S&P's belief that Group 1's creditworthiness
has improved because of its resilient business model, including a
high level of variable costs, and stabilization of the U.S. retail
auto markets," said Standard & Poor's credit analyst Nancy Messer.
"The upgrade also reflects the company's demonstrated ability to
improve its credit measures and S&P's belief that Group 1 will
maintain that improvement," she continued.
In recent quarters, the company's EBITDA margins and cash flow
have improved since the depths of the recession because of
aggressive cost-side initiatives. S&P believes the company will
sustain this more focused cost base. In addition, the company
preserved cash by minimizing capital investment in dealerships and
refrained from making large acquisitions.
Group 1 is one of several large consolidators in the highly
competitive U.S. auto retailing industry. S&P assumes new-vehicle
sales in the U.S. have stabilized and should expand in the year
ahead, and that Group 1's financial policy will enable the company
to continue reducing leverage and maintain a highly disciplined
use of cash for acquisitions and capital spending. S&P expects
the company to increase its acquisition activity using a
combination of free cash flow and mortgage financing. Still, S&P
also assumes the company will maintain balance sheet discipline,
balancing acquisitions and credit measures, or forgoing
acquisitions if EBITDA and cash flow weaken.
The ratings reflect S&P's view of Group 1's business risk profile
as fair because S&P expects the company's resilient business
model, with its diverse revenue stream and variable cost
structure, to support continued good profitability in the next two
years.
S&P views Group 1's liquidity as adequate under its criteria. As
of Sept. 30, 2010, Group 1 had $96.2 million in cash on hand, in
addition to $57.9 million of available investment in a floorplan
offset account that S&P views as highly liquid.
The outlook is stable, reflecting S&P's assumption that Group 1's
improved performance through operating efficiencies, in
combination with its diverse revenue stream and brand mix, will
enable the company to generate discretionary free cash flow (i.e.,
after capital expenditures and dividends) and maintain credit
ratios consistent with the 'BB-' rating, even if the U.S. economy
remains lackluster in the year ahead. S&P assume Group 1 will
pursue a financial policy that will balance business expansion and
shareholder returns leading to credit measures appropriate for the
'BB-' rating and continued free cash flow generation. S&P expects
lease-adjusted leverage in of 3.0x to 4.0x and FFO to total debt
of 20% or better.
S&P could lower the rating if aggressive financial policies lead
to leverage exceeding 4.5x or FFO to total debt falling below 20%,
and if S&P believed the company would not report free cash flow in
the year ahead. This could occur if aggressive debt-financed
acquisitions and/or investment in dealer upgrades leads to higher
debt and adjusted EBITDA remains near the $185 million that S&P
estimate for 2010. S&P could also lower the rating if the slow
economic recovery reverses course and EBITDA declines because the
company is not able to offset revenue declines with cost controls.
Alternatively, S&P could raise the rating if S&P believed Group 1
could achieve and sustain improved credit measures or if S&P's
view of the business risk profile improved. For an upgrade, S&P
would look for sustainable improved credit measures to include
lease-adjusted total debt to EBITDA near 3.0x and FFO to total
debt of 25% or better. An improved business risk profile
assessment would necessitate that the company permanently improve
profitability.
GSC GROUP: Lenders Fight $235-Mil. Sale to Black Diamond
--------------------------------------------------------
A group of lenders is objecting to fellow lender Black Diamond
Capital Management LLC's offer to purchase hedge fund GSC Group
Inc. for $235 million, Dow Jones' Small Cap reports.
As reported in the Troubled Company Reporter on November 2, 2010,
Black Diamond Capital Management, L.L.C. and its affiliate Black
Diamond Commercial Finance, LLC, as agent for a lender group,
emerged -- following a three-day auction -- the winning bidder for
substantially all of the investment management business and
related assets of GSC Group.
A hearing to consider approval of the sale to Black Diamond-led
group is scheduled for 6, 2010.
About GSC Group
Florham Park, New Jersey-based GSC Group, Inc. --
http://www.gsc.com/-- is a private equity firm specializing in
mezzanine and fund of fund investments. It filed for Chapter 11
bankruptcy protection on August 31, 2010 (Bankr. S.D.N.Y. Case No.
10-14653). Michael B. Solow, Esq., at Kaye Scholer LLP, assists
the Debtor in its restructuring effort. Epiq Bankruptcy
Solutions, LLC, is the Debtor's notice and claims agent. Capstone
Advisory Group, LLC, is the Debtor's financial advisor. The
Debtor estimated its assets at $1 million to $10 million and debts
at $100 million to $500 million.
GURNEY'S INN: Benjamin Suit Dismissed for Improper Venue
--------------------------------------------------------
District Judge Robert W. Sweet dismisses LINDA BENJAMIN,
Plaintiff, v. THOMAS CARUSONA, CHRISTOPHER BENNETT, LOLA COOPER
MONTEMARANO, and KEITH COOPER, as Trustees of GURNEY'S INN CORP.
LIQUIDATING TRUST, and LCM SPA & RESORT CONSULTANTS LLC,
Defendants, and GURNEY'S INN RESORT & SPA LTD., Nominal Defendant,
case no. 09-cv-9722 (S.D.N.Y.), at the Trust Defendants' behest,
for improper venue. Gurney's motion to dismiss or transfer the
action is denied as to Gurney's, Carusona, and Bennett. The Court
also issued other rulings in the suit.
Ms. Benjamin filed her initial complaint on November 23, 2009,
alleging a violation of Section 720(b) of the New York Business
Corporation Law and common law breach of fiduciary duty, and
seeking a declaratory judgment, an injunction, reorganization of
the board of directors, an accounting and damages. The original
complaint named the Liquidating Trust as a defendant, but the
action against the Liquidating Trust was voluntarily dismissed
without prejudice on February 8, 2010.
A copy of the Court's opinion, dated November 5, 2010, is
available at http://is.gd/hJRBzfrom Leagle.com.
Gurney's is a popular resort, spa, restaurant and conference
center founded in 1926. Gurney's filed for Chapter 11 bankruptcy
in 1994 and was reorganized in 1999.
HARLAN LABORATORIES: S&P Downgrades Corporate Credit Rating to 'B'
------------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Indianapolis-based Harlan Laboratories Inc. to
'B' from 'B+'. At the same time, S&P lowered the senior secured
debt rating on Harlan's credit facility to 'B' from 'BB-', and
revised the recovery rating on the debt to '3' from '2'. The '3'
recovery rating indicates expectations for meaningful (50%-70%)
recovery in the event of a default. The outlook is negative.
"The ratings on Harlan, a provider of lab research models and
preclinical services, reflect the company's aggressive debt
leverage, tight covenants, an operating focus in markets that
include some larger competitors," said Standard & Poor's credit
analyst Arthur Wong, "and recently, the ongoing, difficult
conditions in the pharmaceutical outsourced research services
industry." The company's global reach, customer diversity, and
longer term macroeconomic trends that support spending on its
services partially offset these factors.
HEATHER CREEK: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Heather Creek Foods, LLC
12485 Commissioner Drive
North Jackson, OH 44451
Bankruptcy Case No.: 10-44358
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
Northern District of Ohio (Youngstown)
Judge: Kay Woods
Debtor's Counsel: Richard G. Zellers, Esq.
RICHARD G. ZELLERS & ASSOCIATES
3810 Starrs Centre Drive
Canfield, OH 44406
Tel: (330) 702-0780
Fax: (330) 702-0788
E-mail: zellersesq@cs.com
Scheduled Assets: $884,026
Scheduled Debts: $2,068,877
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/ohnb10-44358.pdf
The petition was signed by Thomas Lisko, vice president.
IA GLOBAL: Lowers Net Loss to $20,943 in Fiscal Q2
--------------------------------------------------
IA Global Inc. filed its quarterly report on Form 10-Q, reporting
a net loss of $20,943 on $2.13 million of revenue for the three
months ended Sept. 30, 2010, compared with a net loss of
$4.89 million on zero revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2010, showed
$4.65 million in total assets, $3.30 million in total current
liabilities, $2.79 million in long-term debt, and a stockholders'
deficit of $1.45 million.
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?6fb4
As reported in the Troubled Company Reporter on July 20, 2010,
Sherb & Co., LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern, following
the Company's results for the fiscal year ended March 31, 2010.
The independent auditors noted that the Company has incurred
significant operating losses, and has a working capital deficit as
of March 31, 2010.
About IA Global
San Francisco, Calif.-based IA Global, Inc. (OTCQB: IAGI.OB)
-- http://www.iaglobalinc.com/-- is a global services and
outsourcing company focused on growing existing businesses and
expansion through global mergers and acquisitions. The Company is
utilizing its current partnerships to acquire growth businesses in
target sectors and markets at discounted prices. The Company is
actively engaging in discussions with businesses that would
benefit from our business acumen and marketing expertise,
knowledge of Asian Markets, and technology infrastructure.
J CREW: S&P Downgrades Corporate Credit Rating to 'BB-'
-------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on New York City-based J. Crew Group two notches to
'BB-' from 'BB+' and placed the rating on CreditWatch with
negative implications. The rating action is a result of the
company's agreement to be acquired by TPG Capital and Leonard
Green & Partners. This transaction will materially weaken J.
Crew's credit protection metrics because S&P believes it will add
a significant amount of debt.
The downgrade and concurrent CreditWatch placement follows the
announcement that the company is being acquired by TPG Capital and
Leonard Green & Partners for approximately $3 billion. The deal
includes a "go shop" agreement which allows the company to
solicit, receive, evaluate, and enter into negotiations with
respect to alternative proposals through Jan. 15, 2011.
"In S&P's opinion, a meaningfully debt-financed transaction would
weaken J. Crew's credit protection metrics considerably from
current levels with the result that the highest rating S&P could
see pro forma for the acquisition is 'BB-'," said Standard &
Poor's credit analyst David Kuntz. Depending on the amount of
debt to be used, the rating could be in the 'B' category. As of
third-quarter 2010, the company's debt to EBITDA was 1.1x and
interest coverage was 9.0x. Currently, S&P views the company's
business risk as fair and the financial risk profile as highly
leveraged.
JACKSON HEWITT: Refund Anticipation Loan Document Now Due Dec. 17
-----------------------------------------------------------------
On April 30, 2010, Jackson Hewitt Tax Service Inc. and certain of
its subsidiaries entered into a Fourth Amendment to their Amended
and Restated Credit Agreement, originally dated as of October 6,
2006, with Wells Fargo Bank, N.A., as Administrative Agent, and
the lenders. The Amendment added a number of events of default to
the Credit Agreement, including with respect to the continuation
and funding of 100% of the Company's refund anticipation loan
("RAL") program for the 2011 tax season ("RAL Requirements").
On November 19, 2010, the Company and the Lenders entered into a
Letter Agreement modifying the RAL Requirements whereby:
i) the date by which the Borrowers are required to deliver
definitive documentation with respect to its RAL program
for the 2011 tax season in accordance with Section 9.1(o)
of the Credit Agreement is amended from December 10, 2010
to December 17, 2010; and
ii) any prior Default or Event of Default resulting from the
Borrowers' failure to have complied with the RAL
Requirements in Sections 9.1(m) and 9.1(n) of the Credit
Agreement are waived.
The Company believes that it is unlikely that it will meet the RAL
Requirements on or prior to December 17, 2010 and is in
discussions with the Administrative Agent with respect to an
amendment of these provisions of the Credit Agreement. However,
while the Company believes that it should be successful in its
efforts to amend the Credit Agreement or obtain another waiver or
forbearance arrangement from the Lenders, there can be no
assurance that the Company will be.
Failure to meet the RAL Requirements would be a default under the
Credit Agreement and could result in the Lenders declaring an
event of default under the Credit Agreement. Such an event of
default would allow the Lenders to, among other things, terminate
their commitments to lend any additional amounts to the Company
and declare all borrowings outstanding, together with accrued and
unpaid interest, to be immediately due and payable.
About Jackson Hewitt
Jackson Hewitt Tax Service Inc. (NYSE: JTX)
-- http://www.jacksonhewitt.com/-- provides computerized
preparation of federal, state and local individual income tax
returns in the United States through a nationwide network of
franchised and company-owned offices operating under the brand
name Jackson Hewitt Tax Service(R). The Company provides its
customers with convenient, fast and quality tax return preparation
services and electronic filing. In connection with their tax
return preparation experience, the Company's customers may select
various financial products to suit their needs, including refund
anticipation loans ("RALs") in the offices where such financial
products are available.
Jackson Hewitt Tax Service Inc. was incorporated in Delaware in
February 2004 as the parent corporation. Jackson Hewitt Inc.
("JHI") is a wholly-owned subsidiary of Jackson Hewitt Tax Service
Inc. Jackson Hewitt Technology Services LLC is a wholly-owned
subsidiary of JHI that supports the technology needs of the
Company. Company-owned office operations are conducted by Tax
Services of America, Inc. ("TSA"), which is a wholly-owned
subsidiary of JHI. The Company is based in Parsippany, New
Jersey.
JERSON ALVAREZ: Case Summary & 11 Largest Unsecured Creditors
-------------------------------------------------------------
Joint Debtors: Jerson S. Alvarez, Sr.
Sonia Iveth Alvarez
14442 W. Mauna Loa
Surprise, AZ 85379
Bankruptcy Case No.: 10-37863
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Randolph J. Haines
Debtor's Counsel: James I. Webster, Esq.
JAMES PORTMAN WEBSTER, PLLC
935 E Main St., Suite 204
Mesa, AZ 85203
Tel: (480) 464-4667
Fax: (888) 214-8293
E-mail: jim@jpwlegal.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000.000
A list of the Joint Debtors' 11 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/azb10-37863.pdf
JAMES WALLACE, JR: Bank's Payment Demand Forced Ch. 11 Filing
-------------------------------------------------------------
Wayne Faulkner at StarNewsOnline.com reports that Jim Wallace,
president of Intracoastal Realty Corp., sought bankruptcy
protection after a bank demanded Mr. Wallace to immediately
fulfill a loan in its entirety.
The Troubled Company Reporter on November 25, 2010, published a
voluntary Chapter 11 case summary for James E. Wallace, Jr., who
filed for Chapter 11 protection on November 23 (Bankr. E.D. N.C.
Case No. 10-09677). George M. Oliver, Esq., at Oliver & Friesen,
PLLC, in New Bern, N.C., represents the Debtor.
The Debtor estimated assets of $10,000,001 to $50,000,000 and
debts of $50,000,001 to $100,000,000 in his Chapter 11 petition.
Atop the list of 20 largest unsecured creditors is Raleigh-based
RBC, owed $7.8 million. First Bank, which took over Cooperative
Bank after the Wilmington bank failed last year, is also on the
list with a $5.46 million claim.
JOHNNY NGUYEN: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Joint Debtors: Johnny Lai Nguyen
Nancy Hanh Nguyen
dba Mexican Brother Market
1697 Mountaire Lane
San Jose, CA 95138
Bankruptcy Case No.: 10-62072
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Northern District of California (San Jose)
Judge: Charles Novack
Debtor's Counsel: Michael H. Luu, Esq.
LAW OFFICES OF MICHAEL H. LUU
1340 Tully Rd. #309
San Jose, CA 95122
Tel: (408) 425-6221
E-mail: mikeluu63@yahoo.com
Scheduled Assets: $3,529,758
Scheduled Debts: $6,069,837
A list of the Joint Debtors' 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/canb10-62072.pdf
JONES SODA: Posts $5 Million Net Loss in Quarter Ended Sept. 30
---------------------------------------------------------------
Jones Soda Co. filed its quarterly report on Form 10-Q, reporting
a net loss of $578,000 on $5,125,000 in revenues for the three
months ended September 30, 2010, compared with a net loss of
$1,482,000 on $7,156,000 in revenues for the same period in 2009.
The Company reported a net loss of $4,264,000 on $14,383,000 for
nine months ended September 30, compared with a net loss of
$6,050,000 on $21,710,000 revenues for the same period in 2009.
The Company's balance sheet showed total assets of $10,089,000,
total liabilities of $2,404,000, and shareholders' equity of
$7,685,000.
As already reported in the Troubled Company Reporter, Deloitte &
Touche LLP, in Seattle, expressed substantial doubt about the
Company's ability to continue as a going concern, following the
Company 2009 results. The independent auditors noted of the
Company's recurring losses from operations, negative cash flows
from operating activities, accumulated deficit, significant
uncertainties in the Company's ability to meet their 2010
operating plan, and the need to obtain additional equity or debt
financing, during 2010 or early 2011.
In the Form 10-Q, the Company disclosed that it intends to
continually monitor and adjust its business plan as necessary to
respond to developments in its business, its markets and the
broader economy. However, the Company may no longer have
sufficient margin in its plan to absorb further declines against
its expectations with regard to the economy or its business. The
Company believes its operating plan already includes the majority
of attainable cost cutting measures, which places greater emphasis
on the need to meet its case sales projections in order to
effectively operate its business. The economic conditions in 2009
and in 2010 have made forecasting demand for its products
extremely difficult, so there is continued uncertainty regarding
its ability to meet its revised case sales projections. These
uncertainties, together with its inability to implement further
meaningful cost containment measures beyond those it has already
undertaken and the difficult environment in which to obtain
additional equity or debt financing, continue to raise substantial
doubt about its ability to continue as a going concern.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?6fb9
About Jones Soda Co.
Headquartered in Seattle, Washington, Jones Soda Co.
(NASDAQ: JSDA) -- http://www.jonessoda.com/-- markets and
distributes premium beverages under the Jones Soda, Jones Pure
Cane Soda(TM), Jones 24C(TM), Jones GABA(R), Whoopass Energy
Drink(R) brands and sells through its distribution network in
markets primarily across North America.
KOPPERS INC: S&P Raises Corporate Credit Rating to 'BB-'
--------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its
corporate credit rating on Pittsburgh-based Koppers Inc. and its
parent company Koppers Holdings Inc. to 'BB-' from 'B+'. The
outlook is stable.
At the same time, S&P raised the issue-level rating on the
$300 million senior unsecured notes due 2019 to 'B+' (one notch
below the 'BB-' corporate credit rating) from 'B'. The recovery
rating is '5', indicating S&P's expectation for modest (10%-30%)
recovery in the event of default.
"The upgrade reflects S&P's expectation that favorable business
conditions and operating trends within Koppers' carbon materials
and railroad segments in 2011 will continue to support strong
liquidity and a significant financial risk profile consistent with
the ratings," said Standard & Poor's credit analyst Henry Fukuchi.
The ratings on Pittsburgh-based Koppers reflect the company's fair
business risk profile supported by the consistency of operating
results and the preservation of credit metrics in line with the
current ratings. Standard & Poor's expects the current economic
and industry conditions to produce modestly improving operating
results in the near term. The railroad and utility products
segment will likely show improvement in 2011 supported by
gradually improving demand growth. Although the company
experienced soft operating results in its railroad and utility
segment in 2010, S&P expects results to improve somewhat in 2011,
as Class 1 railroads are likely to increase their purchases to
catch up with some delays in crosstie placement this year.
LAND VENTURES: Alabama Court Won't Void Pittman Judgment
--------------------------------------------------------
Chief District Judge Mark E. Fuller denies Windham Todd Pittman's
motion for relief from the Court's final judgment entered against
him on August 30, 2010.
On April 30, 2009, Land Ventures for Two, LLC entered into an
agreement with Farm Credit of Northwest Florida which modified the
terms of a previously negotiated loan transaction. Farm Credit
required an individual to cosign the Note Modification Agreement,
and Mr. Pittman did so. In March 2010, Land Ventures filed for
Chapter 11 Bankruptcy, and Farm Credit filed the suit against Mr.
Pittman, as cosigner, to collect on the NMA. Mr. Pittman
answered, pleading several affirmative defenses including waiver,
estoppel, laches, and statute of limitations. He raised neither
the defense of fraud nor misrepresentation in his Answer. Farm
Credit filed a Motion for Summary Judgment in June 2010, to which
Mr. Pittman did not respond. The Court granted that motion and
entered a Final Judgment against Mr. Pittman for $741,114.
On July 2, 2010, Land Ventures filed suit against Farm Credit,
alleging a violation of the bankruptcy court's automatic stay. In
August 2010, Land Ventures amended its complaint to allege fraud
claims against Farm Credit. Mr. Pittman is concerned that in the
event Land Ventures succeeds in its fraud claims against Farm
Credit, Mr. Pittman will be liable on a note found void in another
legal proceeding. To prevent that perceived injustice and
inconsistency, Mr. Pittman filed the motion for relief.
Judge Fuller says Mr. Pittman could not claim that the NMA he
cosigned is voidable as to him. The kind of fraudulent
misrepresentations alleged by Land Ventures against Farm Credit
would make a contract voidable, not void. "Even if a jury finds
that Farm Credit made misrepresentations to Land Ventures (through
Pittman as agent) during the formation of the NMA, the agreement
is still enforceable against Pittman. Therefore, regardless of
the outcome reached in the suit between Land Ventures and Farm
Credit, that result will not be inconsistent with the final
judgment entered in this case," Judge Fuller says.
The case is FARM CREDIT OF NORTHWEST FLORIDA, ACA, Plaintiff, v.
WINDHAM TODD PITTMAN, Defendant, Case No. 10-cv-0352 (M.D. Ala.).
A copy of Judge Fuller's Memorandum Opinion and Order, dated
November 3, 2010, is available at http://is.gd/hJZcjfrom
Leagle.com.
Based in Defuniak Springs, Florida, Land Ventures for 2, LLC,
filed for chapter 11 bankruptcy protection (Bankr. M.D. Ala. Case
No. 10-30651) on March 16, 2010. Judge William R. Sawyer presides
over the case. Michael A. Fritz, Sr., Esq., at Fritz & Hughes,
LLC, in Montgomery, Alabama, serves as the Debtor's bankruptcy
counsel. In its schedules, the Company disclosed $3,162,500 in
assets and $1,294,980 in debts.
LASER EYE: In Chapter 11; To Close by End of November
-----------------------------------------------------
Rachel Fields at Becker's ASC Review reports that Laser Eye
Center of Hawaii in Honolulu filed for Chapter 11 bankruptcy after
its announcement that it would close at the end of the month.
Laser Eye Center operates Laser Eye Center facility in Hawaii.
The center blamed its woes on the economy.
The Troubled Company Reporter published a case summary for
Honolulu-based Laser Eye Center of Hawaii LLC on November 25,
2010.
Laser Eye filed for Chapter 11 protection on November 22, 2010
(Bankr. D. Hawaii Case No. 10-03546). Jerrold K. Guben, Esq.
O'Connor Playdon & Guben, serves as counsel to the Debtor.
The Debtor estimated assets and debts of $500,001 to $1,000,000.
According to Becker's ASC Review, the Debtor's officials do not
anticipate being able to make payments to unsecured creditors,
which include two physicians, owed $64,350, and $31,150, AMO Sales
and Services, owed $67,120 and Pan Am I, owned $20,370 in rent.
LDK SOLAR: Has Exchange Offer to Avoid 2011 Repurchase Obligation
-----------------------------------------------------------------
LDK Solar Co., Ltd., has commenced an offer to exchange up to
$300 million in aggregate principal amount of its currently
outstanding 4.75% Convertible Senior Notes due 2013 (CUSIP Nos.
50183L AA 5 and 50183L AB 3) for an equal aggregate principal
amount of a newly issued class of 4.75% Convertible Senior Notes
due 2013 and cash in an amount not greater than $85 nor less than
$60.
LDK Solar is conducting the Exchange Offer to reduce the aggregate
principal amount of its outstanding Existing Notes under which
holders may require LDK Solar to repurchase all or a portion of
their Existing Notes on April 15, 2011 prior to maturity.
The Exchange Offer is not conditioned on the tender of any minimum
aggregate principal amount of Existing Notes. The Exchange Offer
is, however, subject to certain other conditions.
For each $1,000 principal amount of Existing Notes, holders will
receive $1,000 principal amount of New Notes plus the Cash
Consideration. The amount of Cash Consideration will be
determined by the modified "Dutch Auction" procedure described in
an Exchange Offer Memorandum dated November 24, 2010.
In addition, holders of Existing Notes whose Existing Notes are
accepted for exchange in the Exchange Offer will be paid cash in
an amount equal to the accrued and unpaid interest on the Existing
Notes up to, but excluding, the settlement date of the Exchange
Offer.
As of November 24, 2010, roughly $395 million in aggregate
principal amount of the Existing Notes were outstanding.
LDK Solar is relying on Section 3(a)(9) of the Securities Act of
1933, as amended, to exempt the New Notes portion of the Exchange
Consideration from the registration requirements of the Securities
Act.
LDK Solar is also relying on Section 18(b)(4)(C) of the Securities
Act to exempt the New Notes portion of the Exchange Consideration
from the registration and qualification requirements of the state
securities laws. LDK Solar has no contract, arrangement or
understanding relating to, and will not, directly or indirectly,
pay any commission or other remuneration to any broker, dealer,
salesperson, agent or any other person for soliciting tenders of
Existing Notes in the Exchange Offer.
The portion of the Exchange Consideration consisting of the Cash
Consideration will be paid for with cash on hand.
The Exchange Offer is subject to the terms and conditions set
forth in a Schedule TO (including the Exchange Offer Memorandum
and related Letter of Transmittal) filed by LDK Solar with the
Securities and Exchange Commission.
The Exchange Offer is scheduled to expire at 11:59 p.m., New York
City time, on December 22, 2010, unless the Exchange Offer is
extended. Tendered Existing Notes may be withdrawn at any time on
or prior to the expiration date of the Exchange Offer.
If the amount of Existing Notes validly tendered and not properly
withdrawn on or prior to the expiration date at or below the Cash
Consideration exceeds the Exchange Offer Amount, LDK Solar will
accept for payment the Existing Notes that are validly tendered
and not properly withdrawn from the Exchange Offer at or below the
Cash Consideration on a pro rata basis from among such tendered
Existing Notes. In all cases LDK Solar will make appropriate
adjustments to avoid exchanges of Existing Notes in a principal
amount other than an integral multiple of $1,000.
The financial advisor for the Exchange Offer is Piper Jaffray &
Co., the information agent for the Exchange Offer is Georgeson
Inc. and the exchange agent for the Exchange Offer is The Bank of
New York Mellon.
Georgeson Inc., serves as information agent for the Exchange
Offer.
Holders of the Existing Notes who have questions or would like
additional copies of the Exchange Offer documents may call the
information agent at (888) 337-7699. Banks and brokerage firms
may call (212) 616-2180.
Going Concern Doubt
As reported by the Troubled Company Reporter-Asia Pacific on
July 6, 2010, LDK Solar said in its annual report on Form 20-F for
the year ended December 31, 2009, that at yearend, the Company had
a working capital deficit of US$833.6 million and an accumulated
deficit of US$32.8 million. The Company said, "During the year
ended December 31, 2009, we incurred a net loss of US$234.2
million [attributable to LDK Solar Co., Ltd. shareholders]. As of
December 31, 2009, we had cash and cash equivalents of US$384.8
million, most of which are held by subsidiaries in China. Most of
our short-term bank borrowings and current installments of our
long-term debt totaling US$978.6 million are the obligations of
these subsidiaries. We may also be required by the holders of our
convertible senior notes to repurchase all or a portion of such
convertible senior notes with an aggregate principal amount of
US$400.0 million on April 15, 2011. These factors initially
raised substantial doubt as to our ability to continue as a going
concern. We are in need of additional funding to sustain our
business as a going concern, and we have formulated a plan to
address our liquidity problem."
The Company cautioned that "we cannot assure you that we will
successfully execute our liquidity plan. If we do not
successfully execute such plan, we may have substantial doubt as
to our ability to continue as a going concern."
The Company reported a net loss of US$234.0 million on US$1.098
billion of revenue for the year ended December 31, 2009, compared
with net income of US$66.4 million on US$1.643 billion of revenue
for the year ended December 31, 2008. The revenue decrease was
primarily due to the decline in the average selling price of the
Company's wafers, although there was significant growth in the
Company's wafer sales volume and processing volume.
The Company's balance sheet at December 31, 2009, showed
US$4.384 billion in assets, US$3.507 billion of liabilities, and
US$876.9 million of stockholders' equity.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?65de
About LDK Solar
LDK Solar Co., Ltd. (NYSE: LDK) -- http://www.ldksolar.com/--
manufactures photovoltaic products and multicrystalline wafers.
LDK Solar's headquarters and manufacturing facilities are located
in Hi-Tech Industrial Park, Xinyu City, Jiangxi Province in the
People's Republic of China. LDK Solar's office in the United
States is located in Sunnyvale, California.
LIONS GATE: Icahn Asks for Dismissal of Lawsuit
-----------------------------------------------
Linda Sandler and Patricia Hurtado at Bloomberg News report that
Carl Icahn asked a federal judge to dismiss a lawsuit by Lions
Gate Entertainment Corp. alleging the financier was "secretly
plotting" to merge the company with Metro-Goldwyn-Mayer Inc.
According to the report, Mr. Icahn said in a filing in U.S.
District Court in Manhattan that Lions Gate's claims that Icahn
failed to disclose his plans should be dismissed because "there
was no duty to disclose, and in any case, the required disclosures
were made."
The Company's allegations that Icahn misled shareholders by buying
MGM debt while criticizing the prospect of a merger of the two
studios "are not true," Icahn said.
Icahn acquired a sufficiently large position in both companies "at
depressed prices to ensure that he maximized his own profits,"
Lions Gate said, the report relates.
According to Bloomberg, Lions Gate sought to rescind the purchases
of all of its shares acquired by Icahn. Lions Gate also asked the
judge to bar Icahn from buying more of its shares and to grant the
studio unspecified damages caused by his alleged interference in
its proposed deals.
The case is Lions Gate Entertainment Corp., v. Icahn, 10-CV-8169,
filed in the Southern District of New York (Manhattan).
About Metro-Goldwyn-Mayer
MGM on November 3, 2010, filed a Chapter 11 petition and a
prepackaged plan of reorganization, which is based on a
contribution of assets by Spyglass Entertainment. MGM rejected a
competing bid by Lions Gate, which offered about $1.7 billion in
stock and debt to MGM creditors, representing a 55% stake in the
combined company.
Mr. Icahn, who is Lions Gate's largest shareholder and owns about
10% of MGM's debt, in October, asked MGM creditors to reject
approval Spyglass Prepackaged Plan when votes were solicited
before the bankruptcy filing. However, on November 3, Icahn
announced that he is supporting the Prepackaged Plan after
reaching a deal with MGM. The settlement with Icahn required
amendments to the Plan to provide that MGM will not acquire the
Cypress film library and, according to Mr. Icahn, "will have a
strong corporate governance structure, including the ability of
stockholders to call special meetings, and there will be
restrictions on poison pills and staggered boards." Mr. Icahn
will also have the right to designate a member on the MGM Board
following its emergence from bankruptcy.
About Lions Gate
British Columbia-domiciled and Santa Monica, California-
headquartered Lions Gate is an independent producer and
distributor of motion pictures, home entertainment, television
programming and animation worldwide and holds a majority interest
in the pioneering CinemaNow VOD business.
Lions Gate Entertainment Corp. reported total assets of
$1,592,874,000 against total liabilities of $1,594,454,000,
resulting in total deficiency of $1,580,000 as of June 30, 2010.
As reported by the Troubled Company Reporter on March 10, 2010,
Standard & Poor's Ratings Services revised its rating outlook on
Lions Gate to negative from stable. At the same time, S&P
affirmed ratings on Lions Gate, including the 'B-' corporate
credit rating.
Lions Gate carries Moody's "B2" corporate family rating and
probability of default rating.
Standard & Poor's Ratings Services revised the CreditWatch
implications on its 'B-' corporate credit rating for British
Columbia, Canada-domiciled and Santa Monica, Calif.-headquartered
Lions Gate Entertainment Corp. and its subsidiary, Lions Gate
Entertainment Inc., to developing from negative. S&P initially
placed the rating on CreditWatch with negative implications on
March 24, 2010, in response to investor Carl Icahn's unsolicited
tender offer to acquire all outstanding shares of the
entertainment company's common stock.
LOCAL INSIGHT: Gets Interim OK to Incur $7.5MM DIP Financing
------------------------------------------------------------
The Hon. Kevinn Gross of the U.S. Bankruptcy Court for the
District of Delaware authorized Local Insight Media Holdings,
Inc., et al., to:
-- obtain $7.5 million on the interim basis, and on the final
basis, up to $25 million in aggregate principal amount of
secured postpetition financing on superpriority priming lien
basis from JPMorgan Chase Bank, N.A., as administrative
agent; and
-- use cash collateral of prepetition secured lenders.
Regatta Investor LLC and its direct and indirect subsidiaries
guaranty the Debtors' obligations in respect of the DIP Financing.
A final hearing on the Debtors' request for DIP loan and cash
collateral use will be held on December 13, 2010, at 1:00
p.m.(prevailing Eastern Time). Objections, if any, are due
December 6 at 4:00 p.m.
As of the Petition Date, the Debtors were indebted to the
prepetition secured lenders:
i) in the aggregate principal amount of not less than
$337,000,300 in respect of loans made under the prepetition
credit agreement;
ii) $19,000 in undrawn available amounts under the letters of
credit issued pursuant to the prepetition credit agreement;
and
iii) amounts owed under Specified Hedge Agreements with the
qualified counterparties plus accrued and unpaid interest
and fees with respect to the obligations.
The Debtors would use the DIP financing and the cash collateral to
continue operations of their businesses. The Debtors were unable
to obtain financing on more favorable terms from sources other
than the DIP lenders.
As adequate protection for any diminution in value of the lenders'
collateral, the Debtors will grant the prepetition secured lenders
(i) replacement liens on all intangible and tangible property in
which the loan parties have an interest; (ii) superpriority
administrative expense claim status, subject to certain carve out
expenses.
As adequate protection to the interest of prepetition agent and
secured lenders in their collateral, the Debtor will grant
adequate protection liens on all of the DIP collateral.
A full-text copy of the Budget is available for free at:
http://bankrupt.com/misc/LocalInsight_Budget.pdf
* * *
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Local Insight Regatta Holdings Inc. has $7.5 million
in interim financing and will have a $25 million loan, assuming it
doesn't sue the lenders based on an alleged defect in the security
interest providing collateral for a $337 million pre-bankruptcy
loan. The final hearing on financing will be Dec. 13.
According to Mr. Rochelle, Local Insight said the lenders failed
to file a financing statement until less than 90 days before the
Chapter 11 filing on Nov. 17. The Company therefore has the right
to sue the lenders, aiming to void the security interest as a
preference. Although the bankruptcy judge in Delaware approved
the $7.5 million interim loan at a Nov. 19 hearing, there will be
a default on the loan if Local Insight sues. The company will
have 20 days to secure replacement financing.
About Local Insight Media Holdings
Wilmington, Delaware-based Local Insight Media Holdings, Inc., is
a publisher of print and online yellow page directories in the
United States. It filed for Chapter 11 bankruptcy protection on
November 17, 2010, (Bankr. D. Del. Case No. 10-13677).
Affiliates Local Insight Media Holdings II, Inc. (Bankr. D. Del.
Case No. 10-13679), Local Insight Media Holdings III, Inc. (Bankr.
D. Del. Case No. 10-13682), LIM Finance Holdings, Inc. (Bankr. D.
Del. Case No. 10-13680), LIM Finance, Inc. (Bankr. D. Del. Case
No. 10-13681), LIM Finance II, Inc. (Bankr. D. Del. Case No. 10-
13687), Local Insight Regatta Holdings, Inc. (Bankr. D. Del. Case
No. 10-13686), The Berry Company LLC (Bankr. D. Del. Case No. 10-
13678), Local Insight Listing Management, Inc. (Bankr. D. Del.
Case No. 10-13685), Regatta Investor Holdings, Inc. (Bankr. D.
Del. Case No. 10-13725), Regatta Investor Holdings II, Inc.
(Bankr. D. Del. Case No. 10-13741), Regatta Investor LLC (Bankr.
D. Del. Case No. 10-13684), Regatta Split-off I LLC (Bankr. D.
Del. Case No. 10-13721), Regatta Split-off II LLC (Bankr. D. Del.
Case No. 10-13753), Regatta Split-off III LLC (Bankr. D. Del. Case
No. 10-13737), Regatta Holding I, L.P. (Bankr. D. Del. Case No.
10-13748), Regatta Holding II, L.P. (Bankr. D. Del. Case No. 10-
13715), and Regatta Holding III, L.P. (Bankr. D. Del. Case No. 10-
13745) filed separate Chapter 11 petitions.
Richard M. Cieri, Esq., Christopher J. Marcus, Esq., and Ross M.
Kwasteniet, Esq., at Kirkland & Ellis LLP, assist the Debtors in
their restructuring efforts. Curtis A. Hehn, Esq., Laura Davis
Jones, Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl &
Jones LLP, are the Debtors' co-counsel.
The Debtors' investment banker and financial advisor is Lazard
Freres & Co. LLC. The Debtors' independent auditor is Deloitte &
Touche LLP. The Debtors' interim management and restructuring
advisors are Alvarez & Marsal North America, LLC, and Avarez &
Marsal Private Equity Performance Improvement Group, LLC.
Kurtzman Carson Consultants LLC is the Debtors' notice and claims
agent.
Local Insight Media Holdings estimated assets of less than $50,000
and liabilities of $100 million to $500 million in its Chapter 11
petition. In its latest Form 10-Q with the Securities and
Exchange Commission, Local Insight Regatta reported consolidated
assets of $796,270,000 against consolidated debts of $669,612,000
as of September 30, 2010.
LODGENET INTERACTIVE: PAR Investment Manager Joins Board
--------------------------------------------------------
LodgeNet Interactive Corporation announced the addition of Edward
L. Shapiro to its Board of Directors. With the appointment of
Mr. Shapiro, LodgeNet increases the size of its Board to nine
directors. Mr. Shapiro will stand for election by the stockholders
at the time of the Company's 2011 Annual Meeting.
Mr. Shapiro is a partner at PAR Capital Management, Inc., a
Boston-based investment management firm specializing in
investments in travel, media and Internet-related companies.
Prior to joining PAR Capital in 1997, Mr. Shapiro was a Vice
President at Wellington Management Company, LLP and before that an
Analyst at Morgan Stanley & Co. PAR Capital has been a long-time
investor in LodgeNet, currently holding both common and preferred
stock.
"Ed Shapiro is an astute and analytical investor with substantial
expertise in creating value within travel, media and technology
businesses," said Scott C. Petersen, Chairman and CEO of LodgeNet.
"We are extremely pleased to welcome Ed to our Board. He will be
a great resource for our company as we continue to build upon our
leadership position in providing media and connectivity solutions
for hospitality and healthcare businesses."
"I have followed LodgeNet since its IPO in 1993 and I am extremely
proud to join its Board of Directors," said Shapiro. "LodgeNet is
in the midst of an exciting transformation and I am eager to begin
working with the Board and management to help achieve its goals."
Mr. Shapiro is currently on the board of three private companies:
Legend 3-D, a leading digital media technology company, Row 44, an
in-flight broadband company and Lumexis Corp, a manufacturer of
advanced in-flight entertainment and connectivity systems. Mr.
Shapiro is also on the Trust Board for Children's Hospital Boston.
He previously served on the board of US Airways from 2005-2008.
Mr. Shapiro earned his BS in economics from the University of
Pennsylvania's Wharton School in 1986 and an MBA from UCLA's
Anderson School of Management in 1990.
About LodgeNet Interactive
Sioux Falls, South Dakota-based LodgeNet Interactive Corporation
(Nasdaq:LNET) -- http://www.lodgenet.com/-- provides media and
connectivity solutions designed to meet the unique needs of
hospitality, healthcare and other guest-based businesses.
LodgeNet Interactive serves more than 1.9 million hotel rooms
worldwide in addition to healthcare facilities throughout the
United States. The Company's services include: Interactive
Television Solutions, Broadband Internet Solutions, Content
Solutions, Professional Solutions and Advertising Media Solutions.
LodgeNet Interactive Corporation owns and operates businesses
under the industry leading brands: LodgeNet, LodgeNetRX, and The
Hotel Networks.
The Company's balance sheet at Sept. 30, 2010, showed
$454.88 million in total assets, $509.32 million in total
liabilities, and a stockholder's deficit of $54.44 million
* * *
Lodgenet carries a 'B3' long term corporate family rating and a
'Caa1' probability of default rating, with 'stable' outlook, from
Moody's. It has 'B' long term foreign and local issuer credit
ratings, with 'stable' outlook, from Standard & Poor's.
"In Moody's opinion, continued cautious investment from LodgeNet's
hotel customers will hamper intermediate term growth in its core
hospitality services business, and over the long term competing
forms of entertainment will pressure this revenue stream as the
company seeks to defend its relevance to both hotel operators and
hotel guests. The B3 corporate family rating incorporates these
weak growth prospects, mitigated somewhat by the company's
moderately high financial risk profile and demonstrated capacity
to generate positive free cash flow throughout challenging
economic conditions, along with a measure of stability from the
monthly fees it receives from hotels regardless of occupancy,"
Moody's said in October 2010.
LONGYEAR PROPERTIES: Can Sell Unit D-102 to Hampers for $1.95-Mil.
------------------------------------------------------------------
The Hon. Frank J. Bailey of the U.S. Bankruptcy Court for the
District of Massachusetts authorized Longyear Properties, LLC, to
sell Private Sale Unit D-102 to Hampers Family Trust for
$1,950,000 in cash.
The sale of Unit D-102 located in 120 D Seaver Street, Brookline,
Massachusetts will be free and clear of liens, claims and
encumbrances.
The Debtor is authorized to disburse at closing the following:
a) payment of usual and customary seller's closing costs and
adjustments incurred in connection with the proposed sale of
Unit D-102, including deed stamps and filing fees, but
excluding the broker's commission as the commission was
incurred prepetition;
b) repayment of the DIP loan to Robert McGinty in the amount of
$25,000, plus interest;
c) payment of $193,335 to the Twon of Brookline for FY2010 and
the first two quarters of FY2011;
d) payment of condominium fees due to the Lonyear at Fisher
Hill Condominium Trust which the Condo Association claims a
priority lien over the Citizens' Mortgage in the amount of
$71,917;
e) escrow of $200,000 of the sale proceeds of Unit D-102
pending further order of the Court; and
f) after payment of the amounts, and the escrow of the amounts,
remit the balance of the sale proceeds to Citizens.
About Longyear Properties, LLC
Norwood, Massachusetts-based Longyear Properties, LLC, filed for
Chapter 11 bankruptcy protection on September 22, 2010 (Bankr. D.
Mass. Case No. 10-20326). Heather Zelevinsky, Esq., at Stewart F.
Grossman, Esq., at Looney & Grossman LLP, represents the Debtor.
The Company disclosed $14,790,980 in assets and $13,576,208 in
liabilities as of the Petition Date.
LPATH INC: Closes $4.9 Million Equity Financing
-----------------------------------------------
Lpath Inc. has closed a private placement sale of 6,978,128 shares
of Class A common stock at $0.70 per share for gross proceeds of
$4.9 million.
Each investor will also receive warrants to purchase the number of
shares of Class A common stock equal to 50% of the number of
common shares they purchased in this financing. The warrants have
a two-year term and are immediately exercisable at a price of
$1.00 per share into restricted shares of Class A common stock.
As part of this transaction, Lpath has agreed to file a
registration statement covering the resale of the shares of Class
A common stock sold in this financing, as well as those shares
issuable upon conversion of the warrants.
The net proceeds received by the company are expected to be
approximately $4.7 million, after deducting commissions, legal
fees, and certain deal-related expenses payable by the company.
Griffin Securities, Inc., Musket Research Associates, Inc., and
Andrew Garrett, Inc. served as placement agents for the financing.
Proceeds from the funding will be primarily used to move Lpath's
drug candidate, iSONEP into Phase 2 clinical trials, as well as
further develop Lpath's other therapeutic programs. iSONEP is a
monoclonal antibody that will be further tested as a treatment for
wet AMD and RPE detachment, a complication secondary to wet AMD.
Results from these clinical trials are expected in the third
quarter of 2011 for RPE detachment and in 2012 for wet AMD.
iSONEP also holds promise as a treatment for other ocular
disorders, such as dry AMD and diabetic retinopathy.
"This funding enables us to continue to advance our iSONEP program
through the clinical trial process, while allowing us to continue
to explore various strategic opportunities that have presented
themselves," said Lpath president and CEO, Scott R. Pancoast. "We
appreciate the confidence expressed by our new and existing
investors in the potential of our leading drug candidates and our
underlying ImmuneY2 technology."
A full-text copy of the Registration Agreement is available for
free at http://ResearchArchives.com/t/s?6fa9
A full-text copy of the Securities Purchase Agreement is available
for free at http://ResearchArchives.com/t/s?6faa
About Lpath
San Diego, Calif.-based Lpath, Inc. is a biotechnology company
focused on the discovery and development of lipidomic-based
therapeutics, an emerging field of medical science whereby
bioactive lipids are targeted to treat human diseases.
According to the Company's 2009 annual report on Form 10-K, Moss
Adams LLP, in San Diego, Calif., expressed substantial doubt about
the Company's ability to continue as a going concern. The
independent auditors noted that the Company had incurred
significant cash losses from operations since inception and
expects to continue to incur cash losses from operations in 2010
and beyond.
At September 30, 2010, Lpath had total assets of $4,915,794, total
liabilities of $5,891,142, and a stockholders' deficit of
$975,348.
MACK-CALI REALTY: Fitch Affirms Preferred Stock Rating at 'BB+'
---------------------------------------------------------------
Fitch Ratings has affirmed these ratings for Mack-Cali Realty
Corporation and Mack-Cali Realty L.P.:
Mack-Cali Realty Corp.
-- Issuer Default Rating at 'BBB';
-- Preferred stock at 'BB+'.
Mack-Cali Realty, LP
-- IDR at 'BBB';
-- Unsecured revolving credit facility at 'BBB';
-- Senior unsecured notes at 'BBB'.
The Rating Outlook is Stable.
The affirmation reflects the company's credit strengths, including
its manageable debt maturity and lease expiration schedules,
granular tenant base and the company's maintenance of leverage and
coverage ratios appropriate for the rating category, despite the
weak operating environment. The Stable Outlook reflects Mack-
Cali's strong liquidity and unencumbered asset coverage of
unsecured debt, offset by expected soft property-level
fundamentals.
The company's portfolio benefits from tenant diversification with
the top 10 tenants representing 14.6% of annual base rent (ABR) as
of Sept. 30, 2010. Five of the 10 largest tenants are considered
investment grade by Fitch.
Mack-Cali's leverage ratio remains consistent with a 'BBB' IDR, as
the company's net debt divided by recurring operating EBITDA was
4.9 times for the 12 months ended Sept. 30, 2010, compared with
4.8x and 5.3x during 2009 and 2008, respectively. The slight
increase in leverage over the past nine months stems from a
decline in recurring EBITDA. Mack-Cali is adequately capitalized,
measured by the book based risk-adjusted capitalization ratio.
The company's risk-adjusted capitalization ratio of 1.07x is flat
over the prior year.
Credit concerns are focused on fragile fundamentals, with high
unemployment continuing to reflect limited prospects for positive
absorption in the near term. Mack-Cali's portfolio is
concentrated in New Jersey with approximately 70.5% of its rental
revenue coming from submarkets within the state. The top five
submarkets are Hudson County (20.5% of base rental revenue as of
Sept. 30, 2010), Bergen County (12.5%), Morris County (12.4%),
Westchester, New York (13.9%), and Essex County (5.9%). While
Fitch is generally concerned with office fundamentals for these
submarkets, Hudson and Bergen Counties are expected to rebound
earlier than others due to their proximity to and affordability
relative to Manhattan.
As a result of the company's geographic concentration in markets
with generally soft fundamentals, the portfolio experienced a 7.5%
decline in same property cash net operating income (NOI) in the
third quarter of 2010 as compared to the same period last year.
Rental rates are expected to continue to roll down to market
levels upon lease expiration, maintaining negative pressure on NOI
growth. Despite this roll down, market research provider Property
& Portfolio Research projects improved asking rents and occupancy
in all of Mack-Cali's submarkets by 2012, giving some indication
that stabilization in these markets is near.
While occupancy and rent deterioration since 2008 have challenged
Mack-Cali's operations, fixed charge coverage remains at a level
that is appropriate for the rating category. Fixed charge
coverage (defined as recurring operating EBITDA less recurring
capital expenditures less straight line rent adjustments, divided
by interest expense, capitalized interest and preferred dividends)
was 2.3x for the 12 months ended Sept. 30, 2010, as compared to
2.5x for the year ended Dec. 31, 2009. Additional stress to
fixed charge coverage includes higher interest expense due to a
bond offering issued in the third quarter of 2009 at an above
average coupon of 7.75%. Fixed charge coverage is expected to
improve in December 2010 with Mack-Cali's announced redemption
of $300 million of notes, which also carry a 7.75% coupon. The
company intends to fund the note redemption with a mixture of
cash proceeds and draws from its revolving credit facility.
The Stable Outlook reflects Mack-Cali's large unencumbered
property pool, which gives the company financial flexibility
as a source of contingent liquidity. Unencumbered asset
coverage of unsecured debt (based on annualized unencumbered
property NOI for the six months ending Sept. 30, 2010 divided
by an 8% capitalization rate reflective of the portfolio) was
2.5x, which is solid for the 'BBB' IDR. Moreover, covenants
within the company's unsecured revolving line of credit agreement
and bond indenture do not currently restrict Mack-Cali's financial
flexibility.
Mack-Cali's liquidity position is strong for the rating category.
Sources of liquidity (unrestricted cash, availability under the
company's unsecured revolving credit facility, expected retained
cash flows from operating activities after dividends and
distributions) divided by uses of liquidity (pro rata debt
maturities and expected recurring capital expenditures) for
Oct. 1, 2010 to Dec. 31, 2012 result in a liquidity coverage
ratio of 1.5x, and 1.9x accounting for the company's intention
to redeem notes next month. Further, the company's debt maturity
schedule is well laddered with no more than 16% of debt maturing
annually over the next five years.
The two-notch differential between Mack-Cali's IDR and its
preferred stock rating is consistent with Fitch's criteria for
corporate entities with a 'BBB' IDR. Based on Fitch's report,
'Equity Credit for Hybrids and Other Capital Securities' (dated
Dec. 29, 2009, and available at 'www.fitchratings.com'), Mack-Cali
Realty Corp.'s preferred units are 75% equity-like and 25% debt-
like since they are perpetual and have no covenants but have a
cumulative deferral option in a going concern. Net debt plus 25%
of preferred stock to recurring operating EBITDA was 5.0x as of
Sept. 30, 2010, compared with 4.8x and 5.3x, as of Dec. 31, 2009
and Dec. 31, 2008, respectively.
Guidelines for Further Rating Actions:
These factors may have a positive impact on Mack-Cali's ratings:
-- Maintaining a fixed charge coverage ratio above 2.7x (for the
12 months ended Sept. 30, 2010, fixed charge coverage was
2.3x);
-- Maintaining leverage (net debt to recurring operating EBITDA)
in a range below 4.5x. (for the 12 months ended Sept. 30,
2010, leverage was 4.9x);
-- Improved market fundamentals.
Going forward, these factors may have a negative impact on Mack-
Cali's ratings:
-- Declining fixed charge coverage to levels below 2.0x;
-- Increasing leverage to above 5.5x.
MANGIA PIZZA: Financial Woes Prompt Chapter 11 Filing
-----------------------------------------------------
Mangia Pizza Investments, LP, which operates about four deep dish
pizzerias in Austin, Texas, filed for Chapter 11 bankruptcy on
November 19 (Bankr. W.D. Texas Case No. 10-13235).
Mangia Pizza estimated as having less than $50,000 in assets and
$500,000 to $1,000,000 in debts in its Chapter 11 petition. The
Company said it owes $143,000 to the Internal Revenue Service, and
$75,000 to the Texas Comptroller.
According to reporting by Jacob Dirr at the Austin Business
Journal, the Company's lawyer stated that the Company has been
consistently losing money at its Round Rock location and will
likely close that restaurant. Remaining locations on Guadalupe
Street, Mesa Drive and Austin-Bergstrom International Airport will
remain open.
The Debtor is represented by
Lynn H. Butler, Esq.
BROWN, MCCARROLL, LLP
111 Congress Avenue, Suite 1400
Austin, TX 78701
Tel: (512) 472-5456
Fax: (512) 479-1101
E-mail: lbutler@brownmccarroll.com
MARTIN CADILLAC: Taps Storch, Miller for Causes of Action
---------------------------------------------------------
Martin Cadillac, LLC, asks the U.S. Bankruptcy Court for the
District of New Jersey for permission to employ Storch Amini &
Munves PC and Miller, Canfield, Paddock & Stone, P.L.C., as
special counsel.
SAM and MC will investigate, analyze and, if warranted, and
prosecute certain potential causes of action. SAM and MC will
coordinate their efforts with the Debtor's other counsel to avoid
duplication of efforts.
Pursuant to the Engagement Agreement, SAM and MC propose to be
compensated on an hourly basis. However, because the Debtor will
not be paying for the representation, SAM and MC seek to be
relieved of the obligation to make application for payment of
compensation and reimbursement of expenses. Instead, SAM and MC
propose to file quarterly statements with Court showing any
amounts billed and paid, well as describing the work performed by
SAM & MC during the applicable period. Pursuant to the Engagement
Letter, Timothy Martin and not the Debtor will responsible for all
the reimbursement.
To the best of the Debtor's knowledge, members and associates of
SAM or MC are "disinterested" as that term is defined in Section
101(14) of the Bankruptcy Code.
SAM can be reached at:
STORCH AMINI & MUNVES PC
Bonnie A. Tucker, Esq.
Bijan Amini, Esq.
Avery Samet, Esq.
2 Grand Central Tower, 25th Floor
140 East 45th Street
New York, NY 10017
Tel: (212) 490-4100
The Court will convene a hearing on November 30, 2010, at
11:00 a.m., to consider the Debtor's request to employ SAM and MC.
About Martin Cadillac, LLC
Englewood Cliffs, New Jersey-based Martin Cadillac, LLC, filed for
Chapter 11 bankruptcy protection on June 25, 2010 (Bankr. D.N.J.
Case No. 10-29520). Gregory S. Kinoian, Esq., and Paul S.
Hollander, Esq., at Okin, Hollander & DeLuca, LLP, represents the
Debtor. The Company estimated assets and debts at $10 million to
$50 million.
MAVERICK ENGINEERING: Case Summary & Creditors List
---------------------------------------------------
Debtor: Maverick Engineering Inc
11490 Westheimer Road, Suite 1000
Houston, TX 77077
Bankruptcy Case No.: 10-40571
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Southern District of Texas (Houston)
Judge: Karen K. Brown
Debtor's Counsel: Theresa D. Mobley, Esq.
CAGE HILL ET AL
5851 San Felipe, Suite 950
Houston, TX 77057
Tel: (713) 789-0500
Fax: (713) 974-0344
E-mail: tmobley@cagehill.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/txsb10-40571.pdf
The petition was signed by Martin Walrath, executive vice
president.
MESA AIR: BofA Transfers Claims to Embraer Units
------------------------------------------------
In an evidence of transfer filed with the Court, Dawn L. Kinney,
senior vice president of Bank of America, N.A., notifies the
Court that Bank of America, as successor to Fleet National Bank,
unconditionally and irrevocably sells, transfers and assigns to
Refine, Inc., solely as trustee pursuant to a certain Trust
Agreement by and among Refine, Inc., Table, Inc., and Rolls-Royce
plc, dated November 5, 2010, its right, title, interest, claim
and causes of action in and to, or arising under or in connection
with, 20 claims filed against Mesa Air Group, Inc., and Mesa
Airlines, Inc.
Refine, Inc. is a wholly owned subsidiary of Embraer-Empresa
Brasileira de Aeronautica S.A. Table, Inc. is a wholly owned
subsidiary of Embraer.
A list of the Assigned Claims is available at no charge at:
http://bankrupt.com/misc/Mesa_CTBoA-EmbraerClms.pdf
Among other things, Bank of America waives any objection to the
transfer of the Assigned Claims to Refine, Inc., and also waives
to the fullest extent permitted by law any notice or right to a
hearing as may be imposed by Rule 3001 of the Federal Rules of
Bankruptcy Procedure, the Bankruptcy Code, applicable local
bankruptcy rules or applicable law.
In another filing, Vas Aero Services, LLC, fka Volvo Aero
Services Corp., transfers a portion of Claim No. 540 for
$111,605, of which $69,905 is an Allowed Administrative Expense
Claim, to TRC Optimum Fund LLC. Only the allowed portion of the
claim is transferred.
.
About Mesa Air Group
Mesa currently operates 130 aircraft with approximately 700 daily
system departures to 127 cities, 41 states, Canada, and Mexico.
Mesa operates as Delta Connection, US Airways Express and United
Express under contractual agreements with Delta Air Lines, US
Airways and United Airlines, respectively, and independently as
Mesa Airlines and go! Mokulele. This operation links Honolulu to
the neighbor island airports of Hilo, Kahului, Kona and Lihue. The
Company, founded by Larry and Janie Risley in New Mexico in 1982,
has approximately 3,500 employees.
Mesa Air Group Inc. and its units filed their Chapter 11 petitions
Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing
assets of $976 million against debt totaling $869 million as of
Sept. 30, 2009.
Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, serve as local counsel.
Imperial Capital LLC is the investment banker. Epiq Bankruptcy
Solutions is claims and notice agent.
Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings undertaken
by Mesa Air Group Inc. and its units.
(http://bankrupt.com/newsstand/or 215/945-7000).
METROPOLITAN 885: Court OKs Garden City as Claims & Noticing Agent
------------------------------------------------------------------
Metropolitan 885 Third Avenue Leasehold, LLC, sought and obtained
authorization from the Hon. Shelley C. Chapman of the U.S.
Bankruptcy Court for the Southern District of New York to employ
The Garden City Group, Inc., as claims and noticing agent.
Garden City will, among other things:
a. notify potential creditors of the filing of the bankruptcy
petition and of the setting of the first meeting of
creditors;
b. assist with and maintain an official copy of the Debtor's
schedules of assets and liabilities and statements of
financial affairs, listing the Debtor's known creditors
and the amounts owed thereto;
c. maintain a post office box for the purpose of receiving
claims; and
d. docket claims received, maintaining the official claims
register for the Debtor on behalf of the Clerk, and making
the claims register available on its Web site.
Garden City will be paid based on the rates of its professionals:
Administrative & Date Entry $45-$55
Mailroom and Claims Control $55
Customer Service Representatives $57
Project Administrators $70-$85
Quality Assurance Staff $80-$125
Project Supervisors $95-$110
Systems & Technology Staff $100-$200
Graphic Support for Web site $125
Project Managers $125-$175
Directors, Senior Consultants and Assistant VP $200-$295
Vice President and above $295
Gardens City's retention agreement with the Debtor is available
for free at:
http://bankrupt.com/misc/METROPOLITAN_885_claimsagentpact.pdf
Jeffrey S. Stein, Garden City's Vice President, assures the Court
that the firm is a "disinterested person" as that term defined in
Section 101(14) of the Bankruptcy Code.
New York-based Metropolitan 885 Third Avenue Leasehold, LLC, was
organized in 2007 as a Delaware limited liability company and is
wholly owned by Metropolitan 885 Third Avenue Leasehold Sub Junior
Mezz LLC, a Delaware limited liability company. Metropolitan 885
owns the leasehold interest on a 34 story Class A office building
located on the eastside of Third Avenue between 53rd and 54th
Streets in New York City.
Metropolitan 885 filed for Chapter 11 bankruptcy protection on
November 16, 2010 (Bankr. S.D.N.Y. Case No. 10-16103). In its
schedules, the Debtor disclosed $139,878,012 in total assets and
$210,337,682 in total debts. Marc E. Richards, Esq., at Blank
Rome, LLP, serves as counsel to the Debtor.
METROPOLITAN 885: Taps Blank Rome as Bankruptcy Counsel
-------------------------------------------------------
Metropolitan 885 Third Avenue Leasehold, LLC, asks for
authorization from the U.S. Bankruptcy Court for the Southern
District of New York to employ Blank Rome LLP as bankruptcy
counsel.
Blank Rome will, among other things:
a. assist the Debtor in the administration and prosecution of
its Chapter 11 case, including taking necessary actions to
protect and preserve the Debtor's estate, which actions
include prosecution of adversary proceedings, defense of
actions commenced against the Debtor, commencement and
prosecution of objections of claims and assisting the
Debtor in the claims reconciliation process;
b. prepare motions, applications, orders and other pleadings
to be filed with the Court, and counsel the Debtor
regarding the preparation of schedules, statements and
operating reports in connection with the administration of
the Debtor's estate;
c. represent the Debtor at hearings held before the Court
concerning its Chapter 11 cases and at statutory
creditors' meetings conducted by the Office of the United
States Trustee; and
d. assist the Debtor in the formulation and negotiation of a
Chapter 11 plan of reorganization or liquidation and
related disclosure statement and confirmation of the plan,
and represent the Debtor during the confirmation process.
Blank Rome will be paid based on the rates of its professionals:
Partners $350-$855
Counsel $350-$855
Associates $260-$525
Paraprofessionals $150-$305
Marc E. Richards, Esq., a partner at Blank Rome, assures the Court
that the firm is a "disinterested person" as that term defined in
Section 101(14) of the Bankruptcy Code.
New York-based Metropolitan 885 Third Avenue Leasehold, LLC, was
organized in 2007 as a Delaware limited liability company and is
wholly owned by Metropolitan 885 Third Avenue Leasehold Sub Junior
Mezz LLC, a Delaware limited liability company. Metropolitan 885
owns the leasehold interest on a 34 story Class A office building
located on the eastside of Third Avenue between 53rd and 54th
Streets in New York City.
Metropolitan 885 filed for Chapter 11 bankruptcy protection on
November 16, 2010 (Bankr. S.D.N.Y. Case No. 10-16103). In its
schedules, the Debtor disclosed $139,878,012 in total assets and
$210,337,682 in total debts. The Garden City Group, Inc., is the
Debtor's claims agent.
MF GLOBAL: Fitch Keeps BB+ Preferred Stock Rating on Watch Neg.
---------------------------------------------------------------
Fitch Ratings has maintained the ratings of MF Global Holdings
Ltd. on Rating Watch Negative where they were placed on March 23,
2010, and maintained on Sept. 22, 2010.
Profitability and revenue generation remain the main rating
constraints for MFG. Earnings and revenue generation have been
weaknesses over the past several periods, reflecting mostly the
low interest rate environment and MFG's sensitivity to
fluctuations in clearing transaction volumes and client account
balances. Incremental principal trading activities, the recent
purchase of the Washington Research Group, and the introduction of
select new products and services are part of MFG's efforts to
diversify and grow revenue. Additionally, management recently
initiated a number of cost-cutting measures while also reducing
balance sheet leverage and enhancing the quality and carry cost of
the firm's capital structure. Still, profitability has remained
elusive. After a marginally profitable 1Q11, MF reported a loss
for 2Q11, albeit influenced by a number of non-operating items.
Fitch looks to management to provide a detailed plan to generate
consistent positive earnings. Subsequent rating actions will
consider the potential impact of the charted course on the firm's
overall risk profile.
The resolution of the Rating Watch could take a number of paths.
The articulation of an achievable path to sustained profitability
could result in a ratings affirmation, albeit with a Negative
Rating Outlook as the company executes its plan. Alternatively,
the ratings could be downgraded, potentially by multiple notches,
if in Fitch's view management's plan is not likely to be
achievable and/or entails a level of risk not commensurate with
the current ratings.
These ratings of MF Global Holdings Ltd. are maintained on Rating
Watch Negative:
-- Long-term Issuer Default Rating 'BBB';
-- Short-term IDR 'F2';
-- Senior debt 'BBB';
-- Preferred stock affirmed 'BB+'.
MF Global Holdings Ltd. is a leading futures and options broker
with subsidiaries in major financial hubs. Main subsidiaries are
registered futures commissions merchants and broker/dealers. MF
Global is heavily regulated as a member of commodities, futures,
and securities exchanges in the U.S., Europe and the Asia-Pacific
region.
MICHAEL F COX: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Joint Debtors: Michael F. Cox
Junie J. Cox
10553 Martinique Isle Drive
Tampa, FL 33647
Bankruptcy Case No.: 10-28262
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Debtor's Counsel: Buddy D. Ford, Esq.
115 N. MacDill Avenue
Tampa, FL 33609-1521
Tel: (813) 877-4669
Fax: (813) 877-5543
E-mail: Buddy@tampaesq.com
Scheduled Assets: $2,077,652
Scheduled Debts: $5,063,571
A list of the Joint Debtors' 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/flmb10-28262.pdf
MICHAEL WAYNE COX: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Joint Debtors: Michael Wayne Cox
Aimee Claire Norwood
40670 Lenah Run
Aldie, VA 20105
Bankruptcy Case No.: 10-19865
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Stephen S. Mitchell
Debtor's Counsel: James P. Campbell, Esq.
CAMPBELL FLANNERY, P.C.
19 East Market Street
Leesburg, VA 20176
Tel: (703) 771-8344
Fax: (703) 777-1485
E-mail: jcampbell@cmzlaw.com
Scheduled Assets: $832,334
Scheduled Debts: $1,524,961
A list of the Joint Debtors' 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/vaeb10-19865.pdf
MICHAELS STORES: Incurs $12 Million Net Loss for October 31 Qtr.
----------------------------------------------------------------
Michaels Stores Inc. reported a net loss of $12 million for three
months ended Oct. 31, 2010, compared to net income of $15 million
for the same quarter in 2009. Total sales for third quarter of
2010 were $968 million, a 4.2% increase from fiscal 2009 third
quarter sales of $929 million. Same-store sales for the comparable
13-week period increased 2.9%.
As of Oct. 30, 2010, the Company's cash balance was $115 million.
Third quarter debt levels declined $146 million to $3.765 billion
compared to $3.911 billion as of the end of third quarter of
fiscal 2009. As of November 17, 2010, availability under the
revolving credit facility was $849 million.
The Company's balance sheet at Oct. 31, 2010, showed $1.78 billion
in total assets, $4.54 billion in total liabilities, and a
stockholders' deficit of $2.76 billion.
John Menzer, Chief Executive Officer, said, "We're very pleased to
announce another quarter of record level sales performance. Our
strongest performers for the quarter were our bakeware, kids
crafts and ribbon categories. Notably, our ribbon category is
comprised of greater than 70% of our own private brand
merchandise. We finished the quarter with a strong sell through
of Halloween inventory which when combined with a focus on pricing
and promotion initiatives and increased direct import penetration
allowed us to drive record operating income for the quarter."
A full-text copy of the earnings release is available for free
at http://ResearchArchives.com/t/s?6fad
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?6fae
As reported by the Troubled Company Reporter on October 8, 2010,
Moody's assigned Caa1 rating to Michaels Stores, Inc.'s proposed
$750 million senior unsecured bonds due 2018. Proceeds from the
note offering will be used to tender for an existing $750 million
series of unsecured notes. The refinancing, while improving the
maturity profile of the company, has no impact on Michaels'
current capital structure or ratings.
Headquartered in Irving, Texas, Michaels Stores, Inc., is the
largest arts and crafts specialty retailer in North America. As
of March 9, 2009, the Company operated 1,105 "Michaels" retail
stores in the United States and Canada and 161 Aaron Brothers
Stores.
MIGHTY FORTRESS: Case Summary & 8 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Mighty Fortress International Ministries, Inc.
aka Mighty Fortress Church
6400 85th Ave N
Brooklyn Park, MN 55445-3000
Bankruptcy Case No.: 10-48691
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
District of Minnesota (Minneapolis)
Judge: Dennis D. O'Brien
Debtor's Counsel: David E. Flowers, Esq.
FLOWERS LAW OFFICE
7616 Currell Blvd., Suite 200
Woodbury, MN 55125
Tel: (651) 735-1530
Fax: (651) 846-5298
E-mail: davidFlowers@flowerslawoffice.com
Scheduled Assets: $6,015,941
Scheduled Debts: $6,891,839
A list of the Company's eight largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/mnb10-48691.pdf
The petition was signed by Brenda Colston, secretary.
MMM HOLDINGS: Moody's Assigns 'B1' Rating on Senior Secured Debt
----------------------------------------------------------------
Moody's Investors Service has assigned a B1 senior secured debt
rating to MMM Holdings, Inc.'s and NAMM Holdings, Inc.'s proposed
shared $423 million senior secured credit facility. At the close
of the amendment, it is estimated that the credit facility will
consist of a $363 million term loan due in April 2015 and a five-
year $60 million revolver. The proposed amendment would result in
a projected $100 million increase in the existing term loan, with
the net proceeds being used to pay a dividend to the group's
stockholders, as well as general corporate purposes. The rating
agency also assigned Ba1 insurance financial strength ratings to
two of the companies' operating subsidiaries, MMM Healthcare,
Inc., and PrimeCare Medical Network, Inc. The outlook on the
ratings is stable.
Ratings Rationale
Moody's stated that under the credit facility agreement, MMM
Holdings and NAMM Holdings will continue to be equal co-borrowers.
The credit facility will have a guarantee from Aveta Inc.
(unrated), the parent company of MMM Holdings and NAMM Holdings,
together with cross-guarantees between its unregulated
subsidiaries. The facilities will be secured with the pledge of
the assets of Aveta, as well as the pledge of stock of each of the
borrowers and their subsidiaries and all assets of the non-
regulated entities.
The rating agency said that the B1 senior debt rating reflects
Aveta's leveraged capital structure, including the large amount of
goodwill on the balance sheet; high concentration in Puerto Rico;
and the company's dependence on Medicare Advantage (MA) products.
Moody's Senior Vice President, Steve Zaharuk, stated that, "The
major concern with MA business is the change in government
reimbursement levels under the healthcare reform act. It is not
clear how current MA members will respond to the resulting benefit
and premium changes that will likely result from the reduced
reimbursement levels over the next several years." However, the
rating agency noted that since 2011 reimbursements to managed care
companies are being held level with 2010, membership growth
prospects look to be promising for the current open enrollment
period, especially for MMM in Puerto Rico, where its margins
provide the company with flexibility in enhancing benefit
offerings without raising premiums. The increased net margins
over the last several years reflect MMM's improved medical
management initiative, led by its development of exclusive
independent practice association relationships.
The rating agency commented that while the amendment to the
credit facility would increase the amount of outstanding debt by
$100 million to approximately $363 million at year end 2010, the
company's leverage and coverage metrics remain relatively strong
for the company's rating level. At the increased debt level, the
rating agency expects the company's debt to EBIT ratio will remain
below 1.5 times during 2011, with an earnings coverage ratio
(EBIT/Interest expense) above 6 times. While both metrics are
better than expected for the companies' ratings, the rating agency
noted it projects that proforma financial leverage (debt/capital,
where debt includes operating leases) would increase to above 60%
during 2011, which is at the high end of rating expectations.
Moody's said that if on a consolidated basis the group achieves
net income margins above 4%, demonstrates consistent annual
Medicare Advantage net membership growth of 3%, continues
expansion of its non-Puerto Rico operations and improves its NAIC
risk-based capital ratio on a sustained basis of at least 125% of
company action level, then the ratings could be upgraded.
However, if annual net margins fall below 1%, if membership
declines in any year by 25% or more, if the RBC ratio declines
below 50% CAL, or if there is a breach in any of the financial
covenants in its credit agreement, then the ratings could be
downgraded.
These ratings were assigned with a stable outlook:
* MMM Holdings, Inc. -- senior secured debt rating at B1,
corporate family rating at B1;
* NAMM Holdings, Inc. -- senior secured debt rating at B1;
* MMM Healthcare, Inc. -- insurance financial strength rating at
Ba1;
* PrimeCare Medical Network, Inc. -- insurance financial strength
rating at Ba1.
Aveta Inc., the parent company of MMM Holdings and NAMM Holdings,
is a privately-owned company incorporated in Delaware and
headquartered in Fort Lee, New Jersey. As of September 30, 2010,
Aveta reported stockholders' equity of approximately $240 million
and approximately 224,000 Medicare members. For the first nine
months of 2010, total revenues were $1.8 billion.
Moody's insurance financial strength ratings are opinions of the
ability of insurance companies to pay punctually senior
policyholder claims and obligations.
MOHEGAN TRIBAL: S&P Junks Issuer Credit Rating From 'B'
-------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Uncasville, Connecticut-based Mohegan Tribal Gaming Authority; the
issuer credit rating was lowered to 'CCC' from 'B'. At the same
time, S&P placed the ratings on CreditWatch with negative
implications.
"The ratings downgrade and CreditWatch listing reflect weaker-
than-expected operating performance in the fiscal year ended
Sept. 30, 2010, in addition to substantial refinancing needs
beginning in 2012, when MTGA's $675 million bank credit facility
and $250 million senior subordinated notes mature," said Standard
& Poor's credit analyst Melissa Long.
MTGA reported an adjusted EBITDA decline of 6.5% for the fiscal
year, driven primarily by declines at its Mohegan Sun property in
Connecticut. S&P had previously cited its expectation that EBITDA
would be relatively flat in fiscal 2010. S&P estimates that
leverage, as measured by total adjusted debt (including about
$110 million in Tribal debt, which is serviced through a priority
distribution from casino earnings) to EBITDA (which S&P measures
after relinquishment payments to its former developers) was more
than 7.5x at Sept. 30, 2010.
Given recently reported operating performance and MTGA's highly
leveraged capital structure, as well as limited clarity around
refinancing plans and timing, S&P believes it is becoming
increasingly likely MTGA will seek to restructure is capital
structure in a manner that results in some debtholders being
offered less than par value. MTGA also recently hired Blackstone
to assist the Authority with its capital structure challenges.
In resolving the CreditWatch listing, S&P will monitor
management's progress in refinancing and will assess MTGA's
capital structure once a refinancing plan is announced. In the
event that MTGA moves forward with a restructuring that would
result in any debtholders being offered less than par, S&P expects
to lower its rating further.
MXENERGY HOLDINGS: Amends Certificate of Incorporation
------------------------------------------------------
On November 17, 2010, MxEnergy Holdings Inc. adopted a fourth
amended and restated certificate of incorporation.
The Certificate of Incorporation authorizes 200,000,000 shares of
common stock, par value $0.01 per share consisting of 50,000,000
shares of Class A Common Stock, 10,000,000 shares of Class B
Common Stock, 40,000,000 shares of Class C Common Stock and
100,000,000 shares of Class D Common Stock. The Certificate of
Incorporation and the Bylaws contain customary provisions
including provisions relating to certain approval rights,
preemptive rights, restrictions on transfer, rights of first
refusal, tag-along rights, drag-along rights and other customary
provisions.
The recent amendments to the Company's certificate of
incorporation, among other things:
i) change the Company's registered agent and registered
office,
ii) provide that the levels of compensation for directors and
committee members specified in the Company's Third Amended
and Restated Certificate of Incorporation, dated as of July
27, 2010, apply to all non-management directors and
iii) clarify that a director will only be paid one meeting
attendance fee per day regardless of the number of board
or Board committee meetings attended by such director on a
given day.
Specifically, the Certificate of Incorporation changes the
registered office of the Company to Corporation Trust Center, 1209
Center Street, Wilmington, Delaware 19801, and the name of the
registered agent of the Company in the State of Delaware to The
Corporation Trust Company.
Effective as of September 22, 2009, the Company will pay each
director who is not an employee of the Company for his or her
service on the Board and any Board committee in accordance with
the levels of compensation for directors and committee members
specified in the Company's Certificate of Incorporation. For the
avoidance of doubt, the Chairman of the Board will not be
considered an employee of the Company for the purposes of the
definition of Non-Management Director solely by virtue of holding
the office of Chairman.
The Company also will pay each Non-Management Director for
attendance in person or by telephone at each regular or special
meeting of the Board or Board committee of which such director is
a member in accordance with the meeting attendance fee provisions
in the Certificate of Incorporation; provided, however, that no
director shall be paid more than one meeting attendance fee per
day, regardless of the number of regular or special Board or Board
committee meetings attended in person or by telephonic conference
by such director on such day. The Company will reimburse each of
its directors for all reasonable travel and other out-of-pocket
costs and expenses relating to his or her attendance at any
regular or special meeting of the Board or any Board committee of
which such director is a member or otherwise incurred by such
director in connection with the performance of his or her duties
as a director of the Company.
About MxEnergy Holdings
MxEnergy Holdings Inc. was founded in 1999 as a retail energy
marketer. The two principal operating subsidiaries of Holdings
are MxEnergy Inc. and MxEnergy Electric Inc. which are engaged in
the marketing and supply of natural gas and electricity,
respectively. Holdings and its subsidiaries operate in 39 market
areas located in 14 states in the United States and in two
Canadian provinces.
MxEnergy carries 'Caa3' long term corporate family and 'Ca/LD'
probability of default ratings from Moody's Investors Service.
The Company's balance sheet at Sept. 30, 2010, showed
$178.29 million in total assets, $114.69 million in total
liabilities, and stockholders' equity of $63.60 million.
NAI ENTERTAINMENT: Moody's Assigns 'B1' Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service assigned a B1 corporate family rating
and a B2 probability of default rating to NAI Entertainment
Holdings LLC, a wholly-owned subsidiary of National Amusements
Inc. (a private media holding company owned by the Redstone
family). As part of the rating action, Moody's assigned B1
ratings to NAI's new senior secured notes, which, among other
things, refinance pre-existing debts at National Amusements. NAI
was also assigned an SGL-2 speculative grade liquidity rating
(indicating good liquidity). The rating outlook is stable. NAI
holds nearly all of National Amusements' cinema assets plus a
portion of its equity interests in CBS Corp. and Viacom Inc.
These summarizes NAI's ratings and the rating actions:
Assignments:
Issuer: NAI Entertainment Holdings LLC
-- Corporate Family Rating, Assigned B1
-- Probability of Default Rating, Assigned B2
-- Senior Secured Regular Bond/Debenture, Assigned B1 (LGD3,
32%)
-- Speculative Grade Liquidity Rating, Assigned SGL-2
Ratings Rationale
On one hand, NAI is a small cinema operator with weak financial
performance, little free cash flow, and a complex legal entity and
management structure. However, NAI is also an investment company
with -- in proportion to its debt -- considerable asset value
stemming from holdings in CBS and Viacom; there is also the
associated incoming dividend. The B1 CFR and B2 PDR reflect the
relatively high default risk resulting from NAI's weak cash flow
generating capability, while also reflecting outsized recovery
prospects in the event of a default. The CBS and Viacom holdings
also augment the security package which includes NAI's cinema
operations and real estate holdings. The ratings also reflect
NAI's very small aggregate scale and relatively poor operating
margins. As well, a majority of the company's EBITDA stream is
derived from foreign operations and the periodic repatriation of
foreign cash flow provides a level of complexity that augments
risk. So too does the "carve-out" of NAI from National
Amusements; NAI is an artificial entity whose assets are legally
but perhaps not operationally separable and whose management is
provided under a services contract that also addresses National
Amusements. Cinema operation is characterized by relatively
stable demand and the business model is recession-tested. While
Moody's have concerns about competition from alternative
exhibition media, declining attendance and limited price
elasticity, these dynamics allow ratings for industry participants
to tolerate somewhat more financial leverage than would otherwise
be the case. Moody's anticipate NAI will have solid liquidity
arrangements comprised of reasonable levels of operating cash
flow, a substantial committed revolving credit facility (access to
which is not expected to be limited by financial covenant
compliance issues), and the ability to monetize components of the
substantial collateral package.
Rating Outlook
The stable rating outlook is predicated on Moody's expectation
that the company will allocate de-levering potential towards
discretionary growth capital expenditures and that, as a result,
leverage will remain relatively constant in the mid-to-high 6x
range (on a fully adjusted basis) over the rating horizon.
What Could Change the Rating -- Up
A rating upgrade is not contemplated within the rating horizon.
However, among other things, Moody's would consider an upgrade or
positive outlook if FCF/TD was expected to be maintained around 5%
and TD/EBITDA was expected to be sustained below 6x (in both
cases, incorporating Moody's standard adjustments). A rating
upgrade would also have to involve assurance of solid liquidity
arrangements and positive industry fundamentals.
What Could Change the Rating -- Down
Moody's would consider a ratings downgrade if free cash flow
generation was expected to be nominal or negative for a prolonged
period and if TD/EBITDA was expected to be in excess of 7x, once
again, on a sustained basis, or if FCF, excluding incoming
dividends and the like, were minimal or negative. Any of a debt-
financed acquisition (of more than nominal size), adverse
liquidity developments, or deteriorating industry fundamentals
could also cause downwards rating pressure. As well, should the
estimated after-tax asset value provided by the security package
erode below (approximately) 1.5x, the rating would also be subject
to downwards rating pressure.
Company Profile
NAI Entertainment Holdings LLC is a wholly-owned subsidiary of
National Amusements Inc. (a Norwood, Massachusetts-based private
media holding company owned by the Redstone family). NAI holds
nearly all of National Amusements' cinema assets plus a minority
of its equity interests in CBS Corp. and Viacom Inc.
NAI'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 its 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 NAI's's core industry and NAI's ratings are believed to
be comparable to those of other issuers of similar credit risk.
NASSER NASSER: Voluntary Chapter 11 Case Summary
------------------------------------------------
Joint Debtors: Nasser I. Nasser
aka Victor Nasser
Esperance Nasser
5600 E Rio Verde Vista Dr
Tucson, AZ 85750
Bankruptcy Case No.: 10-37692
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
District of Arizona (Tucson)
Judge: Eileen W. Hollowell
Debtor's Counsel: Eric Slocum Sparks, Esq.
ERIC SLOCUM SPARKS PC
110 S Church Ave #2270
Tucson, AZ 85701
Tel: (520) 623-8330
Fax: (520) 623-9157
E-mail: eric@ericslocumsparkspc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Joint Debtors did not file a list of its largest unsecured
creditors together with its petition.
NATIONAL AMUSEMENTS: S&P Assigns 'B+' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned Norwood,
Massachusetts-based movie exhibitor National Amusements Inc.
and its subsidiary, NAI Entertainment Holdings LLC, its
preliminary 'B+' corporate credit rating. (S&P analyzes NAI
and NAIE on a consolidated basis for purposes of the corporate
credit rating.) The rating outlook is stable.
At the same time, S&P assigned NAIE's proposed $390 million Rule
144A privately placed seven-year senior secured notes S&P's
preliminary 'BB' rating (two notches higher than its preliminary
'B+' corporate credit rating on the company). S&P's preliminary
recovery rating on this debt is '1', indicating its expectation of
very high (90% to 100%) recovery for noteholders in the event of a
payment default.
The loan will be guaranteed on a senior secured basis by NAIE's
existing and future wholly owned domestic restricted subsidiaries,
but not by parent NAI. In addition, the notes will be secured by
a first-priority lien on all shares of Viacom Inc. class A common
stock and CBS Corp. class A common stock owned by NAIE and the
guarantors, and by a second-priority lien on substantially all
other assets owned by the issuer or the guarantors. There is no
explicit credit support by CBS or Viacom, nor does S&P impute any
support in S&P's consolidated analysis that underlies the
corporate credit rating. NAIE plans to distribute net proceeds of
the notes issue, along with borrowings under its new (unrated)
$50 million revolving credit facility, to NAI so that the parent
may repay all amounts outstanding under its existing margin loan.
"The preliminary 'B+' corporate credit rating on NAI reflects
S&P's expectation that the company will continue to be subject to
long-term industrywide declines in theater attendance--
notwithstanding the intermediate-term boost of 3D premium ticket
pricing -- high leverage and interest costs, and a weak EBITDA
margin compared to movie exhibitor peers'," said Standard & Poor's
credit analyst Deborah Kinzer.
NAI's and NAIE's combined voting equity stake in Viacom and CBS is
an important support to the asset coverage of debt and overall
flexibility. S&P views National Amusements' business risk profile
as vulnerable because of its below peer average operating
measures, and its financial risk profile as aggressive because of
its heavy debt burden.
The consolidated company is a midsize cinema operator, but a major
Northeast U.S. player, with 77 movie theaters and 944 screens,
primarily located in the Northeast, as well as in the U.K.,
Brazil, and Argentina. NAIE operates 72 of the theaters, with 876
screens. For this reason, S&P regards NAIE as a core subsidiary
of the parent.
NORTEL NETWORKS: To Seek OK to Enforce Price on VoIP Asset Sale
---------------------------------------------------------------
American Bankruptcy Institute reports that Nortel Networks Corp.
will seek a bankruptcy judge's approval to enforce the
$179.5 million purchase price of its Carrier voice-over-Internet-
protocol and application solutions asset sale to private equity-
backed buyer Genband Inc.
GENBAND and Nortel have been in a dispute with respect to a
purchase price adjustment. Nortel is claiming that Genband has
improperly reduced its offer to purchase the Company's Voice over
Internet Protocol and application solutions unit to $142.9
million.
As reported in the Troubled Company Reporter on November 24, 2010,
GENBAND Inc., is asking the U.S. Bankruptcy Court for the District
of Delaware to grant relief from automatic stay to allow
arbitration to commence; and compel the commencement of
arbitration between Nortel Networks and GENBAND pursuant to the
terms of the asset sale agreement dated as of December 22, 2009.
GENBAND proposes a hearing on December 8, 2010, at 10:00 a.m., to
consider its motion to commence arbitration on purchase price
adjustment. Objections, if any, are due December 1 at 4:00 p.m.
About Nortel Networks
Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/--
delivers communications capabilities that make the promise of
Business Made Simple a reality for the Company's customers. The
Company's next-generation technologies, for both service provider
and enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help
eliminate the barriers to efficiency, speed and performance by
simplifying networks and connecting people to the information they
need, when they need it.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. The Nortel Companies related in
a press release that Nortel Networks UK Limited and certain
subsidiaries of the Nortel group incorporated in the EMEA region
have each obtained an administration order from the English High
Court of Justice under the Insolvency Act 1986. The applications
were made by the EMEA Subsidiaries under the provisions of the
European Union's Council Regulation (EC) No. 1346/2000 on
Insolvency Proceedings and on the basis that each EMEA
Subsidiary's centre of main interests is in England. Under the
terms of the orders, representatives of Ernst & Young LLP have
been appointed as administrators of each of the EMEA Companies and
will continue to manage the EMEA Companies and operate their
businesses under the jurisdiction of the English Court and in
accordance with the applicable provisions of the Insolvency Act.
Several entities, particularly, Nortel Government Solutions
Incorporated have material operations and are not part of the
bankruptcy proceedings.
As of September 30, 2008, Nortel Networks Corp. reported
consolidated assets of US$11.6 billion and consolidated
liabilities of US$11.8 billion. The Nortel Companies' U.S.
businesses are primarily conducted through Nortel Networks Inc.,
which is the parent of majority of the U.S. Nortel Companies. As
of September 30, 2008, NNI had assets of about US$9 billion and
liabilities of US$3.2 billion, which do not include NNI's
guarantee of some or all of the Nortel Companies' about
US$4.2 billion of unsecured public debt.
NPS PHARMACEUTICALS: Former Eli Lilly VP Added to Board
-------------------------------------------------------
NPS Pharmaceuticals appointed of Pedro Granadillo to its board of
directors. Mr. Granadillo served as senior vice president of
global manufacturing and human resources at Eli Lilly and Company
until 2004 when he retired after 34 years of service.
"[Mr. Granadillo] brings a wealth of industry leadership to the
NPS board of directors," said Peter G. Tombros, chairman of NPS
Pharmaceuticals. "His prior leadership positions and extensive
experience in the pharmaceutical industry will be extremely
valuable as we conclude Phase 3 trials and prepare for regulatory
filings and potential commercial launches of GATTEX and NPSP558.
It is a pleasure to welcome Pedro and we look forward to his
contributions to our future success."
Mr. Granadillo brings more than 30 years of pharmaceutical
industry experience to the NPS board of directors. At Eli Lilly
and Company, he served as vice president of human resources, vice
president of pharmaceutical manufacturing, executive director of
operations and director of manufacturing strategy development. As
the company's top executive for manufacturing and human resources,
Mr. Granadillo was a member of the executive committee and
responsible for managing an extensive network of pharmaceutical
manufacturing facilities and for policies affecting the company's
global workforce of more than 43,000 employees.
Mr. Granadillo received a B.S. in industrial engineering from
Purdue University. He currently serves as a director of Dendreon
Corporation, Haemonetics Corporation, and Nile Therapeutics and
previously served as a director of Noven Pharmaceuticals and First
Indiana Bank.
About NPS Pharmaceuticals
Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq:
NPSP) -- http://www.npsp.com/-- is developing new treatment
options for patients with rare gastrointestinal and endocrine
disorders.
NPS noted in its Form 10-K for the year ended Dec. 31, 2009, it
has not been profitable since its inception in 1986. As of
December 31, 2009, it had an accumulated deficit of
$922.7 million. "Currently, we are not a self-sustaining business
and certain economic, operational and strategic factors may
require us to secure additional funds." The Company though
believes its existing capital resources at December 31, 2009,
along with the receipt of $38.4 million from the sale of its
REGPARA royalty stream, should be sufficient to fund its current
and planned operations through at least January 1, 2011.
The Company's balance sheet at Sept. 30, 2010, showed
$228.82 million in total assets, $378.65 million in total
liabilities, and a stockholders' deficit of $149.82 million.
NYC OFF-TRACK: Creditor Wants Competitive Bidding for Unit
----------------------------------------------------------
New York City Off-Track Betting Corp.'s proposed transfer of its
Internet and telephone gambling business to certain creditors
should be subject to a competitive bidding process, according to a
fellow New York state horse-wagering organization, Dow Jones'
Small Cap reports.
According to the report, Catskill Regional Off-Track Betting Corp.
on filed court papers questioning the appropriateness of an NYC
OTB restructuring plan that satisfies the claims of certain
unsecured creditors with the transfer of the wagering unit while
treating other unsecured creditors like itself "far less
favorably."
Under NYC OTB's restructuring plan, the organization proposes to
transfer the wagering unit to its key creditors -- New York Racing
Association, Yonkers Racing Corp., Empire Resorts/Monticello
Raceway and Finger Lakes Racing Association, all horse-track
operators, the report relates. The tracks are owed approximately
$65 million.
General unsecured creditors, owed nearly $17 million, are slated
to share in a pool of up to $3.4 million, the report notes.
About NYC Off-Track Betting
New York City Off-Track Betting Corporation is a public benefit
corporation, which operates an off-track pari-mutuel betting
system on thoroughbred and harness horse races held at all 11 race
tracks located in New York State and certain race tracks located
outside of the State. Since NYC OTB's inception in 1971, it has
made payments of nearly $2 billion to the State horse racing
industry, more than $1.4 billion to New York City and nearly
$600 million to the State. In 2008 alone, NYC OTB made statutory
contributions in an aggregate amount of $128.6 million to the
State horse racing industry, the State, the City, and other local
municipalities. NYC OTB's operations are regulated by the State.
NYC OTB sought protection under Chapter 9 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 09-17121) on December 3, 2009. NYC
OTB is represented by Richard Levin, Esq., at Cravath, Swaine &
Moore LLP., in New York City, and Michael S. Fox, Esq., Herbert C.
Ross, Esq., David Y. Wolnerman, Esq., at Olshan Grundman Frome
Rosenzweig & Wolosky LLP in New York City.
At September 30, 2009, NYC OTB disclosed $18,468,147 in total
assets, $74,912,742 in total current liabilities, $6,982,887 in
long-term liabilities, and $201,020,000 in long-term post
employment benefits.
OTTAWA BUS: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Ottawa Bus Service, Inc.
dba Crossroad Tours
1320 W. 149th Street
Olathe, KS 66061-6814
Bankruptcy Case No.: 10-24011
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
District of Kansas (Kansas City)
Debtor's Counsel: Timothy E. Keck, Esq.
ARNOLD & KECK
525 E Kansas City Road
Olathe, KS 66061
Tel: (913) 764-8500
E-mail: tkeck@arnoldkeck.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
OXFORD INDUSTRIES: Oxford Apparel Sale Won't Move Moody's Rating
----------------------------------------------------------------
Moody's Investors Service stated that the announced agreement of
Oxford Industries, Inc., to sell its Oxford Apparel operating
group does not impact its B1 Corporate Family Rating and stable
outlook.
Headquartered in Atlanta, Georgia, Oxford Industries, Inc., is a
producer and marketer of branded and private label apparel. Major
brands include Tommy Bahama and Ben Sherman. The company
distributes products such as dress shirts, sports shirts and
casual slacks through national chains, specialty catalogs, mass
merchants, department stores, specialty stores and Internet
retailers, and also operates retail stores for some of its brands.
PARAMOUNT RESOURCES: Raises $29.97-Mil. from Public Offering
------------------------------------------------------------
Paramount Resources Ltd. has completed its previously announced
public offering of 1,100,000 Class A Common Shares issued on a
"flow-through" basis in respect of Canadian exploration expenses
at a price of $27.25 per share for gross proceeds of $29,975,000.
The shares were sold through a syndicate of underwriters led by
BMO Capital Markets.
Paramount has also completed its previously announced private
placement of 1,020,000 Common Shares issued on a "flow-through"
basis in respect of Canadian development expenses at a price of
$24.50 per share and 150,000 Common Shares issued on a "flow-
through" basis in respect of Canadian exploration expenses at a
price of $27.25 per share for total gross proceeds of $29,077,500.
About Paramount Resources
Paramount Resources Ltd. is a Calgary, Alberta based exploration
and production company that produced approximately 11,000 barrels
of oil equivalent per day (net) in 2009. Production was primarily
natural gas.
* * *
Paramount Resources carries 'B' issuer credit ratings from
Standard & Poor's.
Paramount carries a 'B3' corporate family rating from Moody's
Investors Service. As reported in the TCR on July 16, 2010,
Moody's said the upgrade to 'B3' reflects Paramount's demonstrated
ability to navigate challenging industry and capital market
conditions and maintain a base level of production through prudent
capital and liquidity management. The upgrade also reflects
Paramount's substantial alternate liquidity through the value in
its equity investments. Paramount's operating environment,
however, will remain challenging given the company's very high F&D
and operating cost profile, according to Moody's.
PARAMOUNT RESOURCES: Moody's Gives Neg. Outlook, Keeps 'B3' Rating
------------------------------------------------------------------
Moody's Investors Service changed Paramount Resources Ltd.'s
rating outlook to negative from stable and affirmed the company's
B3 Corporate Family Rating. At the same time, Moody's assigned a
Caa2 rating to Paramount's proposed C$250 million senior unsecured
notes. Moody's also assigned a (P)Caa2 senior unsecured rating to
Paramount's Base Shelf Prospectus dated October 29, 2010, with
respect to the C$250 million proposed senior unsecured notes being
issued thereunder. The proceeds of the new notes issue will be
used to repay the company's existing US$90.2 million senior
secured notes and to prefund capital expenditures for 2011.
Assignments:
Issuer: Paramount Resources LTD
-- Senior Unsecured Regular Bond/Debenture, Assigned a range of
82 - LGD5 to Caa2
-- Senior Unsecured Shelf, Assigned (P)Caa2
Outlook Actions:
Issuer: Paramount Resources LTD
-- Outlook, Changed to Negative From Stable
Ratings Rationale
"The negative outlook reflects a significant increase in
Paramount's near term leverage and the considerable execution risk
surrounding the plan to rapidly grow upstream natural gas
production in 2011 and 2012 in tandem with the expansion of
midstream gas processing capacity"" said Moody's Senior Vice
President, Terry Marshall. "The production growth will
materialize over time and after significant incremental debt has
been incurred, leaving leverage (on a debt to production basis)
elevated in the near term. Furthermore, the company is ramping up
production at a time when natural gas prices are expected to
remain under pressure due to soft demand and continued rapid
growth in shale gas production in North America."
Paramount plans to spend over $100 million in building midstream
facilities and considerably more in drilling, completion and tie-
in costs in pursuit of almost tripling its current upstream
production (13,200 barrels of oil equivalent (boe)net of royalties
in Q3, 2010) over the next two years. In recent years, the
company has been unable to show organic growth, and has not proven
to be a cost effective operator of E&P assets.
Due to heavy upfront capital expenditures, Paramount will also
experience steady erosion in liquidity until early 2012, when
production reaches a higher plateau and elevated capital spending
needs dissipate. However, the company will have the flexibility
to pare back spending in the event of protracted weak natural gas
prices, as both midstream and upstream development is expected to
occur in modular fashion. In the past, the company has also shown
the willingness to monetize its equity holdings to improve
liquidity and repay debt.
Pro forma for the notes, the C$60 million equity issue in November
2010, and anticipated debt repayments, Paramount had approximately
C$241 of cash and C$143 million of available borrowing capacity
(after excluding C$17 million LCs outstanding) under its
C$160 million borrowing base revolving credit facility as of
September 30, 2010. There is a high likelihood that the company
will have used up most of this liquidity by the end of 2011. The
company would then need additional external financing to fund a
portion of its growth capex. To meet this liquidity need, Moody's
would expect Paramount to expand its reserves-based borrowing base
revolver following the addition of significant amounts of proved
developed producing reserves.
Moody's notes that Paramount has substantial alternate liquidity
through the value in its equity investments. The combined market
value of Paramount's quoted investment portfolio was approximately
C$444 million at Sept 30, 2010. Paramount's bank lenders have a
first charge over the producing assets of Paramount, but not the
equity investments. (Include in this value are approximately
12.8 million Trilogy Energy Corp. shares, which are currently
pledged to the C$90 million secured notes, and will be released
when these notes are repaid.) The investment portfolio represents
an important pool of liquidity to Paramount.
Paramount's B3 CFR is supported by its substantial alternate
liquidity and historically low leverage, which has weakened
substantially following the new debt issue, but is expected to
improve over the next 18 months as new production comes on-stream
and reserves are added. The rating also considers the more than
50 percent management ownership. The rating is constrained by the
company's poor operating track record, and small production and
reserves base (19.2 million boe total proved), and high full-cycle
costs (US$75/boe) that have limited organic reserves replacement.
The rating could be downgraded to Caa1 if Paramount is unable to
attain production growth within its projected capex and timeline
causing leverage to remain elevated over a longer period, or if
the company runs into liquidity problems. The outlook would
return to stable if the company can lower leverage as measured by
debt to production below US$20,000 per boe on a sustainable basis
while bringing production and capital expenditures to a more
steady state.
The Caa2 rating on the proposed senior unsecured notes is two
notches lower than the B3 CFR due to the substantial amount of
existing and anticipated secured debt in the capital structure.
Moody's assume that secured debt will increase from current levels
as the company will need to raise additional external liquidity to
fund its planned growth.
Paramount Resources Ltd. is a Calgary, Alberta based predominantly
natural gas producing E&P company with principal properties in
Alberta, the Northwest Territories, British Columbia, Montana, and
North Dakota.
PATIENT SAFETY: Signs 3-Year Contract With CEO Brian Stewart
------------------------------------------------------------
On November 15, 2010, Patient Safety Technologies Inc. entered
into an employment agreement, effective as of June 24, 2010, with
Brian E. Stewart, President, Chief Executive Officer and director
of the Company, regarding his employment with the Company.
The term of the Agreement is three years from the Effective Date,
and automatically extends for additional one-year terms thereafter
unless either party delivers written notice of non-extension to
the other party at least ninety days prior to the extension of the
term. Mr. Stewart's annual base salary is $200,000, to be
increased to $245,000 for the remainder of the term upon a
Positive Operating Income Determination (as defined in the
Agreement). He is also eligible to participate in the Company's
executive bonus plan, under which the minimum target bonus
opportunity is 25% of his annual base salary. The Company granted
him a stock option for 2,000,000 shares of the Company's common
stock, 500,000 of which vest as of the date of the grant. An
additional 250,000 stock options will vest and become exercisable
six months from the Effective Date, and the remaining shares will
vest over a 42-month period at a rate of 1/48th of the total
shares per month, with 100% of the option becoming exercisable on
the fourth anniversary of the Effective Date. The exercise price
will be set at the weighted average trading price of the Company's
common stock on the Executive's first day of employment, but not
less than $0.75 per share. Based on that formula, the exercise
price was established at $0.75 per share.
The Agreement provides certain benefits in connection with
termination without cause or resignation for good reason and
changes of control of the Company.
A full-text copy of the Employment Agreement is available for free
at http://ResearchArchives.com/t/s?6fa8
About Patient Safety Technologies
Patient Safety Technologies, Inc. (OTC: PSTX) --
http://www.surgicountmedical.com/-- through its wholly owned
operating subsidiary SurgiCount Medical, Inc., provides the
Safety-Sponge(TM) System, a system designed to improve the
standard of patient care and reduce health care costs by
preventing the occurrence of surgical sponges and other retained
foreign objects from being left inside patients after surgery.
RFOs are among one of the most common surgical errors.
* * *
In its March 31, 2010 report, Squar, Milner, Peterson, Miranda &
Williamson, LLP, in San Diego, California, noted that the
Company's significant recurring net losses through December 31,
2009, and significant working capital deficit as of December 31,
2009, raise substantial doubt about the Company's ability to
continue as a going concern.
The Company's balance sheet at Sept. 30, 2010, showed $12.02
million in total assets, $10.10 million in total liabilities, and
a stockholders' equity of $1.92 million.
PHILOSOPHY INC: Coty-Carlyle Deal Won't Affect Moody's B2 Rating
----------------------------------------------------------------
Moody's Investors Service said that Philosophy, Inc.'s
announcement that Coty Inc. (not rated by Moody's) has agreed
to acquire it from The Carlyle Group does not affect Philosophy's
B2 corporate family rating, nor the existing ratings. The ratings
outlook remains stable. The transaction is expected to close by
year-end. Financial terms of the transaction were not disclosed.
It is expected that Philosophy's debt will be repaid upon closing
of the acquisition. Upon consummation of the acquisition and full
repayment of rated debt, the ratings will be withdrawn.
This summarizes the current ratings:
Philosophy Acquisition Company, Inc.
-- Corporate family rating at B2;
-- Probability-of-default rating at B2.
Philosophy, Inc.
-- $35 million senior secured revolving credit facility due 2013
at B2 (LGD3, 46%);
-- $214 million first lien senior secured term loan due 2014 at
B2 (LGD3, 46%).
The last rating action was on March 11, 2010, when Moody's
affirmed Philosophy's B2 corporate family rating, the B2
probability-of-default rating, and the B2 rating on the first lien
senior secured credit facilities.
Philosophy Acquisition Company, Inc., is the parent company of
Philosophy, Inc. and BioTech Research Laboratories, Inc.,
headquartered in Phoenix, Arizona. Philosophy develops,
manufactures and markets premium personal care products under the
Philosophy brand.
PILOT TRAVEL: Moody's Affirms 'Ba2' Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service affirmed all ratings of Pilot Travel
Centers, LLC, including its Ba2 Corporate Family and Probability
of Default Ratings. Moody's also affirmed Pilot's Ba2 (LGD 4,
59%) rating on its senior secured bank credit facility. In
addition, Moody's changed Pilot's outlook to positive from stable.
"The change in outlook to positive reflects Moody's view that
Pilot's debt protection metrics are relatively strong and will
continue to improve as management focuses on debt reduction and
operating performance will remain stable" stated Bill Fahy, Senior
Analyst at Moody's. "The positive outlook also reflects Moody's
expectation that Pilot successfully integrates the acquisition of
Flying J Travel Centers and maintains good liquidity" commented
Fahy.
Ratings affirmed and LGD point estimates adjusted are:
-- Corporate Family Rating of Ba2
-- Probability of Default Rating of Ba2
-- $500 million senior secured revolving credit expiring 2014 at
Ba2 (LGD 4, 59% from LGD 4, 55%)
-- $500 million senior secured term loan A due 2014 at Ba2 (LGD
4, 59% from LGD 4, 55%)
-- $666.5 million senior secured term loan B due 2016 at Ba2
(LGD 4, 59% from LGD 4, 55%)
-- $345 million senior secured term Loan C at 2017, rated Ba2
(LGD 4, 59% from LGD 4, 55%)
The outlook was changed to positive from stable
The Ba2 Corporate Family Rating reflects Pilot's relatively strong
debt protection measures, good liquidity, meaningful scale,
geographic reach, and relatively diverse profit stream. The
ratings are constrained by the reliance on high volume, low margin
fuel sales, the risk associated with the integration of the Flying
J acquisition, some regional concentration, and the inherent risk
of additional acquisitions in a consolidating industry.
Factors that could result in an upgrade include a sustained
improvement in debt protection metrics driven in part by stronger
operating performance of its fuel business, with gross margins
from Pilot's non- fuel businesses remaining stable. A higher
ratings would also require a financial policy and growth strategy
that remained balanced and supported the credit profile required
of a higher rating, as well as the successful integration of the
Flying J acquisition and good liquidity. Quantitatively, an
upgrade would require debt to EBITDA of below 4.0 times, EBITA
coverage of interest of above 2.5 times, and retained cash flow to
net debt of over 14%.
A downgrade could occur in the event that debt protection measures
weaken or liquidity deteriorate. An inability to successfully
integrate the Flying J acquisition or the adoption of an
aggressive financial policy or growth strategy that negatively
impacted debt protection metrics or liquidity could also pressure
the ratings. Specifically, ratings could be downgraded if debt to
EBITDA exceeded 4.5 times, EBITA coverage of interest fell below
1.75 times, or liquidity deteriorated.
The last rating action for Pilot was on November 17, 2009 when the
initial ratings were assigned, Corporate Family rating of Ba2 and
a stable outlook.
Pilot Travel Centers LLC is a partnership that owns and operates
approximately 438 truck stops across the U.S. In addition to fuel,
Pilot locations have convenience stores, fast food restaurants,
and other amenities. Annual revenues are approximately
$17 billion.
Moody's adopts all necessary measures so that the information it
uses in assigning a credit rating is of sufficient quality and
from sources Moody's considers to be reliable including, when
appropriate, independent third-party sources. However, Moody's is
not an auditor and cannot in every instance independently verify
or validate information received in the rating process.
POINT BLANK: Looks to Sell Assets at Auction for at Least $14MM
---------------------------------------------------------------
Point Blank Solutions Inc. is commencing an expeditious sale
process, saying it has no other option but to try to sell its
assets by the end of the year, Dow Jones' Small Cap reports.
Headquartered in Pompano Beach, Florida, Point Blank Solutions,
Inc. -- http://www.pointblanksolutionsinc.com/-- designs and
produces body armor systems for the U.S. Military, Government and
law enforcement agencies, as well as select international markets.
The Company maintains facilities in Pompano Beach, Florida, and
Jacksboro, Tennessee.
The Company's former chief executive officer and chief operating
officer were convicted in September 2010 of orchestrating a
$185 million fraud.
Point Blank Solutions, formerly DHB Industries, filed for
Chapter 11 protection on April 14, 2010 (Bankr. D. Del. Case No.
10-11255). Laura Davis Jones, Esq., and Timothy P. Cairns, Esq.,
at Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel
to the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP
serves as corporate counsel. T. Scott Avila of CRG Partners Group
LLC is the restructuring officer. Epiq Bankruptcy Solutions
serves as claims and notice agent.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Equity Security
Holders in the case. The Equity Committee has tapped Morrison
Cohen LLP, and The Bayard, P.A., as counsel. Robert M. Hirsh,
Esq., and Heike M. Vogel, Esq., at Arent Fox LLP, serve as counsel
to the Creditors Committee, and Frederick B. Rosner, Esq., and
Brian L. Arban, Esq., at Messana Rosner & Stern LLP, serve as co-
counsel.
PRODIGY HEALTH: Moody's Affirms 'B2' Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service has affirmed the B2 corporate family
rating of Prodigy Health Group, Inc., and changed the outlook to
positive from stable based on the company's improving financial
results and metrics. The rating agency also affirmed the B2
senior secured rating of Prodigy's secured 1st lien credit
facility ($171 million term loan and $20 million revolver) and the
Caa1 senior secured rating of Prodigy's $75 million 2nd lien
secured credit facility. The outlook on the credit facility
ratings was also changed to positive from stable.
Moody's said the positive outlook reflects the company's improving
EBITDA and earnings margins. In 2009, the company reported EBITDA
of about $54 million and positive net earnings for the first time.
Through the first nine months of 2010, the company has reported
EBITDA of a little over $42 million and a net income margin of
4.5%. Steve Zaharuk, Senior Vice President at Moody's, commented,
"As Prodigy continues to grow, realize synergies from its
acquisitions and improve its operating efficiency, it is expected
that EBITDA and net margins will be continue to improve and place
upward pressure on ratings."
Despite the improved results, the rating agency noted that the
overall B2 corporate family rating and the B2/Caa1 bank credit
ratings continue to reflect the company's weak financial
flexibility: high leverage (Adjusted Debt to EBITDA of 4.2x where
debt incudes an adjustment for operating leases), low coverage
ratio (EBITDA less cap ex interest coverage of 3.6x), and a
private ownership structure, which limits its capital markets
access. However, mitigating these factors is the company's
position as one of the largest independent health plan managers
with a national geographic base and over one million covered
lives.
The rating agency stated that Prodigy has been very acquisitive
over the last few years, including the purchase of several small
TPA's and medical management companies during 2008. While
acquisitions have slowed down over the last two years the company
did complete one acquisition in 2009 and one in 2010. Synergies
obtained from these acquisitions have been instrumental in
increasing Prodigy's EBITDA.
The rating agency stated that the ratings could move up if debt to
EBITDA is reduced to at least 3.5x, EBITDA interest coverage is at
least 4x, and the combined company achieves annual organic
earnings growth of at least 3.5% while maintaining current
earnings margin levels. However, if the company becomes involved
in a large acquisition involving additional debt, if EBITDA
interest coverage falls below 1x , if free cash flow to debt is
below 2.5%, or if there is an annual decline in revenue of 10% or
greater, then the ratings could be moved down.
These ratings were affirmed with a positive outlook:
* Prodigy Health Group, Inc. -- corporate family rating at B2; 1st
lien senior secured rating at B2; 2nd lien senior secured rating
at Caa1.
Prodigy Health Group, Inc., a health services holding company that
provides self--funded health plan administration to employers,
claims processing to managed care companies, and medical
management to health plan payers, is headquartered in New York,
New York. Although Prodigy sells health benefit plans to
employers, it does not assume any underwriting risk and it is not
subject to insurance regulations. As of September 30, 2010 the
company reported shareholders' equity of $95 million. Total
revenue for the first nine months of 2009 was $157 million.
Moody's corporate family rating is an opinion of a corporate
family's ability to honor all of its financial obligations and is
assigned to a corporate family as if it had a single class of debt
and a single consolidated legal entity structure.
RADIO ONE: S&P Raises Corporate Credit Rating to 'CCC+'
-------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term corporate
credit rating on U.S. radio broadcaster Radio One Inc. to 'CCC+'
from 'SD' (selective default). The rating outlook is positive.
In addition, S&P assigned ratings to the company's amended and
extended credit facilities. The senior secured facilities now
consist of a $27.6 million term loan A, a $323 million term loan
B, and a $38.8 million revolving credit facility split into three
different tranches. S&P assigned the facilities its issue-level
rating of 'B-' (one notch higher than the 'CCC+' corporate credit
rating on the company) with a recovery rating of '2', indicating
S&P's expectation of substantial (70% to 90%) recovery for lenders
in the event of a payment default.
S&P also assigned ratings to the company's new 12.5%/15% senior
subordinated notes due 2016. S&P rated these notes 'CCC-' with a
recovery rating of '6', indicating S&P's expectation of negligible
(0% to 10%) recovery for noteholders in the event of a payment
default.
In addition, S&P raised its issue-level rating on the remaining
portion of the company's existing 6.375% senior subordinated notes
due 2013 to 'CCC-' from 'D'. At the same time, S&P affirmed its
'CCC-' issue-level rating on the remaining portion of the
company's existing 8.875% senior subordinated notes due 2011 and
removed this rating from CreditWatch. For both issues, the
recovery rating was left unchanged at '6'.
The rating action reflects Radio One's successful amendment of its
senior secured credit facilities and an exchange offer for its
subordinated debt. The transaction, in S&P's view, eliminates
near-term refinancing risk of its senior secured debt, which was
set to mature Jan. 1, 2011, if the company was unable to refinance
its 8.875% senior subordinated notes prior to that date.
Following the amendment, the company will be able to cure the
default on its 6.375% senior subordinated notes by paying its
missed Aug. 15, 2010 interest payment. S&P views the transaction
as a temporary remedy, as the company must address the June 30,
2012 maturity of its senior secured credit facilities over the
next 12 months. In addition, assuming the company elects that
interest be paid in kind on the new exchange notes, interest
expense will rise by over 70% pro forma for the transaction, and
nearly 60% assuming the company pays interest in cash. In 2011,
where visibility remains limited, the company must grow revenue
and EBITDA to support the increased interest burden.
S&P views Radio One's business risk profile as weak, given
negative secular trends in radio, advertising cyclicality, and
weakness in key markets that has led to the company's
underperformance. S&P views the financial profile as highly
leveraged given the company's high lease-adjusted debt to EBITDA
and low interest coverage pro forma for the amendment and exchange
offer.
Radio One is primarily a radio broadcaster targeting the African-
American audience, with a portfolio of about 53 radio stations in
16 of the top 50 African American markets. Within its radio
segment, there is revenue concentration risk among four markets --
Houston, Texas; Washington, D.C.; Atlanta, Georgia; and Baltimore,
Maryland -- which together account for 50.1% of radio revenue. In
addition to a current 37% interest in TV One, the company has a
53.5% ownership interest in REACH Media Inc., a programming
syndication business that is in a transition to a new ad sales
representation arrangement, which S&P believes will adversely
affect near-term profitability at the segment. Interactive One,
the company's online unit, is currently generating an EBITDA loss
and might not break even until at least 2012 under S&P's base case
scenario. The ratings do not incorporate potential future
transactions aimed at increasing the company's ownership interest
in TV One.
RADIO ONE: Completes Refinancing Transactions, Cures Loan Defaults
------------------------------------------------------------------
Radio One Inc. completed the exchange offer relating to its
8-7/8% Senior Subordinated Notes due 2011 and its 6-3/8% Senior
Subordinated Notes due 2013. The Company retired roughly
$296.2 million in aggregate principal amount of the Existing
Notes, comprised of roughly $97.0 million, or roughly 95.5%,
in aggregate principal amount of the 2011 Notes and roughly
$199.3 million, or roughly 99.6%, in aggregate principal amount
of the 2013 Notes.
The Company's pending amendment to its senior secured credit
facility has also become effective. As a result of the
effectiveness of the senior secured credit facility amendment, all
prior defaults under the senior secured credit facility have been
cured or waived.
As reported by the Troubled Company Reporter on November 16, 2010,
Radio One amended certain of the terms of its exchange offer
relating to its 8-7/8% Senior Subordinated Notes due 2011 and its
6-3/8% Senior Subordinated Notes due 2013 to reduce the minimum
tender condition relating to its 2011 Notes to provide that a
minimum of 90% in aggregate principal amount outstanding of the
2011 Notes be validly tendered and not withdrawn. The previous
hurdle was at least 95% in aggregate principal amount of the 2011
Notes be validly tendered and not withdrawn.
Radio One kept the other minimum tender condition -- that at least
95% of the combined aggregate principal amount outstanding of the
2011 Notes and the 2013 Notes be validly tendered and not
withdrawn -- in place.
The TCR on November 16 also reported that the financial
institutions holding the majority of Radio One's outstanding loans
and commitments under its senior secured credit facility have
approved the proposed amendment to its credit facility. The
effectiveness of the Credit Facility Amendment is conditioned on
the completion of the Exchange Offer.
In August 2010, Radio One warned in a regulatory filing that it
may have to file for bankruptcy absent an extension of a
forbearance agreement or waiver from its lenders.
As reported by the TCR on November 11, the amendment to the Credit
Facility will, among other things:
i) establish new financial covenant levels;
ii) permit the Amended Exchange Offer and the payment of
interest on the 2013 Notes that was otherwise due and
payable on August 16, 2010;
iii) waive any existing default or event of default that may
have arisen under the Credit Facility prior to the
effectiveness of the Credit Facility Amendment;
iv) replace $323.0 million of outstanding revolving loans
with a new term loan;
v) provide revolving credit borrowings of up to $20.0
million that the Company can utilize for working capital
and general corporate purposes and an additional $18.8
million that can only be used for certain specified
purposes, in each case subject to certain conditions and
limitations; and
vi) effect other amendments to permit the Amended Exchange
Offer to occur in accordance with the terms set forth in
the Amended Offering Memorandum.
The Company negotiated the terms of the Credit Facility Amendment
with Wells Fargo Bank, N.A.
BNY Mellon Shareowner Services is acting as exchange agent and
information agent and may be contacted at (800) 777-3674 or (201)
680-6579.
The new securities issued pursuant to the Amended Exchange Offer
have not been registered under the Securities Act of 1933, as
amended, or any state securities laws. Therefore, the new
securities may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements of the Securities Act and any applicable state
securities laws.
A full-text copy of the Agreement dated November 12, 2010, with
certain noteholders is available for free at
http://ResearchArchives.com/t/s?6fac
About Radio One
Based in Washington, Radio One, Inc. (Nasdaq: ROIAK and ROIA) --
http://www.radio-one.com/-- is a diversified media company that
primarily targets African-American and urban consumers. The
Company is one of the nation's largest radio broadcasting
companies, currently owning 53 broadcast stations located in 16
urban markets in the United States. Radio One operates
syndicated programming including the Russ Parr Morning Show, the
Yolanda Adams Morning Show, the Rickey Smiley Morning Show, CoCo
Brother Live, CoCo Brother's "Spirit" program, Bishop T.D. Jakes'
"Empowering Moments", the Reverend Al Sharpton Show, and the
Warren Ballentine Show.
The Company also owns a controlling interest in Reach Media, Inc.
-- http://www.blackamericaweb.com/-- owner of the Tom Joyner
Morning Show and other businesses associated with Tom Joyner.
Radio One owns Interactive One -- http://www.interactiveone.com/
-- an online platform serving the African-American community
through social content, news, information, and entertainment,
which operates a number of branded sites, including News One,
UrbanDaily, HelloBeautiful, Community Connect Inc. --
http://www.communityconnect.com/-- an online social networking
company, which operates a number of branded Web sites, including
BlackPlanet, MiGente, and Asian Avenue and an interest in TV One,
LLC -- http://www.tvoneonline.com/-- a cable/satellite network
programming primarily to African-Americans.
* * *
Ernst & Young LLP, in Baltimore, Maryland, expressed substantial
doubt about the Company's ability to continue as a going concern
in its report on the Company's restated consolidated financial
statements for 2009. The independent auditors noted that in June
and July 2010 the Company violated certain covenants of its loan
agreements, which ultimately may result in significant amounts of
outstanding debt becoming callable by lenders.
Moody's Investors Service has repositioned Radio One Inc.'s
Probability of Default Rating to Caa2/LD, from Caa2, following
expiration of the 30-day grace period under the indenture
governing the company's 6.375% senior subordinated notes due 2013.
The August interest payment was not made in accordance with the
scheduled terms, and Moody's treats the failure to meet the
original contractual terms as a limited default. All of Radio
One's debt ratings remain under review for possible downgrade,
including Radio One's Caa1 corporate family rating.
REGIONS FINANCIAL: S&P Cuts Counterparty Credit Ratings to 'BB+/B'
------------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its ratings on
Regions Financial Corp., including the counterparty credit rating
to 'BB+/B' from 'BBB-/A-3'. The outlook is negative. At the same
time, S&P also lowered its rating on the company's primary bank
subsidiary, Regions Bank, to 'BBB-/A-3' from 'BBB/A-2'.
S&P primarily based the rating action, which follows its full
annual review of the company's financial performance, on S&P's
view that net losses are likely to persist longer than S&P had
previously anticipated. As a result, S&P sees continued pressure
in the near term on the company's capital ratios, which S&P
currently views as somewhat aggressive after taking into
consideration its high commercial real estate exposures and
unfavorable geographic concentrations.
"Furthermore, S&P thinks the company's financial flexibility has
decreased somewhat in recent weeks, which could hurt its ability
to access the debt and equity markets on favorable terms," said
Standard & Poor's credit analyst Robert Hansen.
S&P thinks net losses at Regions will remain significant over the
next several quarters given S&P's expectations of ongoing elevated
loan-loss provisions. While the company's financial performance
improved somewhat in the first half of this year, the most recent
quarter largely undid this progress, particularly as it relates to
asset quality, and remains weak in S&P's opinion. In third-
quarter 2010, operating losses remained high, hurt by a sequential
rebound in loan-loss provisions resulting from elevated problem
asset dispositions. These dispositions resulted in $233 million
of incremental net charge-offs. Also, the company is still seeing
declines in commercial property valuations within its geographic
footprint based on updated real estate appraisals. Moreover, the
company fared poorly in S&P's credit stress testing, which was
updated with slightly higher loss assumptions for a number of loan
portfolios at Regions.
The negative outlook reflects S&P's belief that the rating could
remain under pressure, primarily given Regions' large CRE loan
exposures and unfavorable geographic concentrations. If loan
performance or capital ratios deteriorate meaningfully from
current levels or if operating losses do not moderate, S&P could
lower the rating. More specifically, the rating may come under
further pressure if NPAs, including past-due and restructured
loans, exceeds 7.5% of total loans or if the tangible common
equity ratio declines significantly below 6%. Alternatively, if
financial performance improves materially, S&P could revise the
outlook to stable.
RENAL ADVANTAGE: Moody's Assigns 'B2' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family and
Probability of Default Rating to Renal Advantage Holdings, Inc.
Moody's also assigned a Ba3 (LGD2, 27%) rating to the company's
proposed credit facility, consisting of a $50 million revolving
credit facility and a $350 million term loan. Moody's understands
that the proceeds of the facility, along with $206 million of
unrated subordinated mezzanine debt and an equity contribution
from KRG Capital Partners, LLC, Bain Capital Ventures, LLC and
others will be used to purchase the company from existing
shareholders, including Welsh Carson Anderson & Stowe, and
refinance the company's existing debt. The ratings outlook is
stable. The existing ratings of Renal Advantage Holdings, Inc.
will be withdrawn at the close of the transaction.
Following is a summary of ratings assigned:
Renal Advantage Holdings, Inc.:
-- $50 million senior secured revolving credit facility due
2015, Ba3 (LGD2, 27%)
-- $350 million senior secured term loan due 2016, Ba3 (LGD2,
27%)
-- Corporate Family Rating, B2
-- Probability of Default Rating, B2
These ratings are unchanged and will be withdrawn at the close of
the transaction:
Renal Advantage Holdings, Inc.:
-- $60 million senior secured revolving credit facility due
2015, Ba3 (LGD2, 29%)
-- $245 million senior secured term loan due 2015, Ba3 (LGD2,
29%)
-- Corporate Family Rating, B2
-- Probability of Default Rating, B2
Ratings Rationale
Renal Advantage's B2 rating reflects the expectation that the
company will operate with a considerable amount of financial
leverage following the transaction. Moody's believes that Renal
Advantage will have the highest pro forma adjusted leverage of the
rated peer group of dialysis providers, estimated at approximately
6.3 times at September 30, 2010, including management's
anticipated synergies. Moody's believe this level of leverage
limits financial flexibility in this period in which the company,
and the industry, will be adjusting to changes in the
reimbursement environment. However, Moody's also considered the
company's improvement in operations since its inception and the
relatively stable business profile of the dialysis sector
characterized by increasing incidences of end stage renal disease
and the medical necessity of the service provided.
The stable rating outlook reflects Moody's expectation that the
company should continue to see stable non-acquired growth, which
should provide opportunity to reduce leverage through both EBITDA
expansion and free cash flow generation. The stable outlook also
considers that the company will be able to adjust to the changes
in Medicare reimbursement that will be implemented on January 1,
2011 without significant detriment to the credit metrics.
Given the expectation of initially weak credit metrics for the
rating category, Moody's do not anticipate a near term upgrade of
the ratings. However, if the company can realize the expected
synergies, continue to realize robust growth rates, and materially
reduce leverage through a combination of debt repayment and
increased profitability, Moody's could consider upward pressure on
the ratings. More specifically, the company would have to be
expected to sustain adjusted debt to EBITDA approaching 5.0 times
before considering a change in the outlook to positive or an
upgrade of the ratings.
Conversely, the rating could be downgraded if the company's credit
metrics do not improve as a result of either the inability to
recognize expected synergies or the incurrence of additional debt
for acquisitions or shareholder initiatives. Additionally,
negative pressure on the ratings would be considered if the
bundled prospective payment system has an unfavorable impact on
Renal Advantage's business model.
This is the first time ratings are being assigned to Renal
Advantage Holdings, Inc.
Renal Advantage'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 its 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 of tolerance for risk. These
attributes were compared against other issuers both within and
outside of Renal Advantage's core industry and Renal Advantage's
ratings are believed to be comparable to those other issuers of
similar credit risk.
Headquartered in Brentwood, TN, Renal Advantage is a provider of
outpatient dialysis services to patients with chronic kidney
failure. As of September 30, 2010 Renal Advantage is the third
largest for-profit outpatient dialysis provider with 149 centers
and one laboratory in 19 states. The company recognized
approximately $504 million in revenue for the twelve months ended
September 30, 2010.
RH DONNELLEY: Adrian & Assoc. Claim Discharged Under Plan
---------------------------------------------------------
District Judge Martha Vazquez grants the Motion to Dismiss with
Prejudice Claims Discharged in Bankruptcy, filed by Dex Media,
Inc., d/b/a Qwest Dex on April 26, 2010, in Adrian & Associates,
P.C., v. Qwest Corporation, and Dex Media, Inc. d/b/a Qwest Dex,
case no. 08-205 (D. N.M.). Judge Vazquez finds that the claims
the Plaintiff brought against Dex in the suit have been forever
discharged pursuant to the Confirmation Order and section 1141 of
the Bankruptcy Code and that the Plaintiff cannot continue
prosecution of the action.
The lawsuit was originally filed in the Second Judicial District,
Bernalillo County, New Mexico, and was removed to the District
Court in February 2008. Adrian & Associates seeks damages based
on the failure to print the Plaintiff's paid and unpaid listing in
the white and yellow pages of the telephone book and failure to
correctly list the Plaintiff with directory assistance.
On March 17, 2008, Dex filed a Motion to Compel Arbitration and
Stay Proceedings and the Magistrate Judge issued Proposed Findings
and Recommended Disposition concerning the Motion on October 3,
2008. On February 18, 2009, the Court entered a Memorandum
Opinion and Order in which it adopted the Magistrate Judge's
Recommended Disposition and granted Dex's Motion to Compel
Arbitration and Stay Proceedings as to Dex. At the time Dex filed
for bankruptcy, the Plaintiff had not filed a demand for
arbitration and was precluded from doing so thereafter because of
the bankruptcy stay.
The Plaintiff has not filed a Proof of Claim in the bankruptcy
case.
A copy of the Court's Memorandum Opinion and Order dated
October 29, 2010, is available at http://is.gd/hJRBzfrom
Leagle.com.
About R.H. Donnelley
Based in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun
& Bradstreet Corp. (OTC: RHDCQ) -- http://www.rhdonnelley.com/--
publishes and distributes print and online directories in the
U.S. It offers print directory advertising products, such as
yellow pages and white pages directories. R.H. Donnelley Inc.,
Dex Media, Inc. and Local Launch, Inc., are the company's only
direct wholly owned subsidiaries.
Dex Media East, LLC, is a publisher of the official yellow pages
and white pages directories for Qwest Communications International
Inc. (Qwest) in the states, where Qwest is the primary incumbent
local exchange carrier, such as Colorado, Iowa, Minnesota,
Nebraska, New Mexico, North Dakota and South Dakota.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex
Media East LLC, Dex Media West LLC and Dex Media Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852), after missing a $55 million interest
payment on its senior unsecured notes due April 15. James F.
Conlan, Esq., Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq.,
Jeffrey E. Bjork, Esq., and Peter K. Booth, Esq., at Sidley Austin
LLP, in Chicago, Illinois represent the Debtors in their
restructuring efforts. Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP, in
Wilmington, Delaware, serve as the Debtors' local counsel. The
Debtors' financial advisor is Deloitte Financial Advisory Services
LLP while its investment banker is Lazard Freres & Co. LLC. The
Garden City Group, Inc., is claims and noticing agent.
As of March 31, 2009, the Company had $929,829,000 in total
assets and $1,023,526,000 in total liabilities, resulting in
$93,697,000 in total shareholders' deficit.
RICHARD JOAQUIM: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Joint Debtors: Richard Ralph Joaquim
Nancy Reis Joaquim
5600 N Saguaro Rd
Paradise Valley, AZ 85253
Bankruptcy Case No.: 10-37930
Chapter 11 Petition Date: November 24, 2010
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Charles G. Case II
Debtor's Counsel: Stanford E. Lerch, Esq.
LERCH & DEPRIMA PLC
4000 N Scottsdale Rd, Suite 107
Scottsdale, AZ 85251
Tel: (480) 212-0700
Fax: (480) 212-0705
E-mail: slerch@ldlawaz.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by the Joint Debtors.
The Joint Debtors did not file its list of largest unsecured
creditors when it filed its petition.
RITE WAY: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Rite Way Mechanical Installations, Inc.
dba Rite Way Manufacturing, Inc.
2364 Highwary 7
Lester Prairie, MN 55354
Bankruptcy Case No.: 10-48716
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
District of Minnesota (Minneapolis)
Judge: Robert J. Kressel
Debtor's Counsel: Thomas Flynn, Esq.
LARKIN HOFFMAN DALY & LINDGREN
7900 Xerxes Ave South, Suite 1500
Bloomington, MN 55431
Tel: (952) 896-3362
E-mail: tflynn@larkinhoffman.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/mnb10-48716.pdf
The petition was signed by Denise Johnson, vice president.
ROSEAU DEVELOPMENT: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Roseau Development Company LLC
6375 Imperial Avenue
San Diego, CA 92114
Bankruptcy Case No.: 10-20770
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Debtor's Counsel: Sallie Blackman, Esq.
110 West C Street, Suite 1300
San Diego, CA 92101
Tel: (619) 334-6060
E-mail: blackmangill@yahoo.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by James H. Smith, chief executive
officer.
ROSEWOOD INVESTMENTS: Case Summary & 20 Largest Unsec Creditors
---------------------------------------------------------------
Debtor: Rosewood Investments LLC
126 Dobbin Ave.
Fayetteville, NC 28305
Bankruptcy Case No.: 10-09631
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: Randy D. Doub
Debtor's Counsel: Ocie F Murray, Jr., Esq.
MURRAY CRAVEN & INMAN LLP
P.O. Drawer 53007
Fayetteville, NC 28305-3007
Tel: (910) 483-4990
Fax: (910) 483-6822
E-mail: rebekah@mcilaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/nceb10-09631.pdf
The petition was signed by Timothy Jackson, manager.
RWN-158 GAY: Case Summary & 2 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: RWN-158 Gay Street, LLC
11200 Rockville Pike, Suite 502
Rockville, MD 20852
Bankruptcy Case No.: 10-36709
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
District of Maryland (Greenbelt)
Judge: Thomas J. Catliota
Debtor's Counsel: Bradford F. Englander, Esq.
J. Daniel Vorsteg, Esq.
WHITEFORD TAYLOR & PRESTON, L.L.P.
3190 Fairview Park, Suite 300
Falls Church, VA 22042
Tel: (703) 280-9081
Fax: (703) 280-3370
E-mail: benglander@wtplaw.com
jvorsteg@wtplaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's two largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/mdb10-36709.pdf
The petition was signed by Sidney M. Bresler, president of
Holliday Manager, Inc.
Debtor-affiliates that filed separate Chapter 11 petitions:
Entity Case No. Petition Date
------ -------- -------------
Jersey Island Owner, LLC 10-22970 06/09/10
Northbrook Development Parcel Owner, LP 10-22983 06/09/10
Westbury Owner, LLC 10-30951 09/12/10
RWN-235 Holliday Street, LLC 10-36702 11/23/10
407 East Saratoga Garage, LLC 10-36704 11/23/10
RWN-235 HOLLIDAY: Case Summary & 4 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: RWN-235 Holliday Street, LLC
11200 Rockville Pike, Suite 502
Rockville, MD 20852
Bankruptcy Case No.: 10-36702
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
District of Maryland (Greenbelt)
Judge: Wendelin I. Lipp
Debtor's Counsel: Bradford F. Englander, Esq.
J. Daniel Vorsteg, Esq.
WHITEFORD TAYLOR & PRESTON, L.L.P.
3190 Fairview Park, Suite 300
Falls Church, VA 22042
Tel: (703) 280-9081
Fax: (703) 280-3370
E-mail: benglander@wtplaw.com
jvorsteg@wtplaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's four largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/mdb10-36702.pdf
The petition was signed by Sidney M. Bresler, president of
Holliday Manager, Inc.
Debtor-affiliates that filed separate Chapter 11 petitions:
Entity Case No. Petition Date
------ -------- -------------
Jersey Island Owner, LLC 10-22970 06/09/10
Northbrook Development Parcel Owner, LP 10-22983 06/09/10
Westbury Owner, LLC 10-30951 09/12/10
RWN-158 Gay Street, LLC 10-36709 11/23/10
407 East Saratoga Garage, LLC 10-36704 11/23/10
SABINE PASS: Moody's Downgrades Ratings on Senior Notes to 'B3'
---------------------------------------------------------------
Moody's Investors Service downgraded Sabine Pass LNG, LP's to B3
from B2 for its senior secured notes due 2013 and 2016 and placed
the rating under review for possible downgrade.
Downgrades:
Issuer: Sabine Pass LNG, L.P.
-- Senior Secured Regular Bond/Debenture, Downgraded to B3 from
B2
Outlook Actions:
Issuer: Sabine Pass LNG, L.P.
-- Rating Under Review for Possible Downgrade
Ratings Rationale
Sabine Pass is 91% indirectly owned by Cheniere Energy Inc. (not
rated) and Sabine Pass's credit quality remains closely linked to
Cheniere since Sabine Pass represents most of Cheniere's
consolidated cash flows and operating assets for the foreseeable
future and has extensive contractual agreements.
The rating action reflects the debt put options and maturities
at Cheniere and Sabine Pass over the next several years. In
August 2011, Cheniere faces a put option on a $247 million
secured term loan while Cheniere's $298 million secured term
loan and $205 million of convertible senior unsecured notes both
mature in 2012. Afterwards, Sabine Pass has $550 million in
senior secured notes due in 2013 followed by $1.67 billion of
senior secured notes due in 2016. Moody's understands that
Cheniere has been in dialogue with the lenders to Cheniere's 2011
and 2012 debt facilities and those discussions are continuing.
Moody's views the multiple upcoming debt maturities as a
substantial challenge to Cheniere especially given Cheniere's
negative free cash flow of around $45-55 million on an annualized
basis, Cheniere's unrestricted cash balance of around $82 million
on a consolidated basis as of September 30, 2010, Cheniere's
extremely high consolidated leverage and multiple group of
creditors with differing security positions and maturities. While
Cheniere's debt put option in 2011 and debt maturities in 2012 are
not recourse to Sabine Pass, the close linkage between Cheniere
and Sabine serves as a strong incentive to bring Sabine Pass into
a possible bankruptcy of Cheniere in order for Cheniere to better
control its estate and enable a comprehensive debt restructuring.
Sabine Pass's rating remains supported by its long term contract
with subsidiaries of Chevron and Total SA for approximately 50% of
Sabine Pass's capacity. Based solely on these stable cash flows,
Sabine Pass's interest coverage ratio was around 1.25 times for
the last twelve months ended September 2010 according to Moody's
calculations. These contracted cash flows support a likely above
average recovery in a potential default though Moody's does not
view these contracted cash flows sufficient to result in full
recovery of the senior secured bonds.
Moody's views Cheniere's plan to develop a natural gas
liquefaction facility next to the existing Sabine Pass LNG
regasification and storage facilities as not having credit
implications at this time given the large execution risk
associated with such a project and long lead time before potential
operation. The liquefaction facility requires FERC approval that
could occur by 2012 and commercial operation of the potential
liquefaction plant is not expected until 2015. If the
liquefaction project receives all necessary approvals and advances
to construction, the liquefaction plant could have positive or
negative implications to Sabine depending upon the liquefaction
plant's final contractual arrangements, financing structure and
impact to Cheniere's consolidated credit profile.
During the review period, Moody's will consider Cheniere's
progress on resolving the upcoming debt maturities and the
ultimate outcome of the debt put option on the $247 million term
loan. The lender to the $247 million term loan must provide
notice to exercise the put option no later than June 16, 2011.
The rating could stabilize or improve if Cheniere and Sabine Pass
are able to comprehensively address its upcoming debt maturities
or if Cheniere substantially improved its credit profile on a
standalone basis. Resolution of the debt put option on the
$247 million term loan without a comprehensive resolution of the
other debt maturities could result in a change in outlook to
negative given the 2012 debt maturities at Cheniere.
The rating could be revised downward if Cheniere's credit quality
deteriorates further, if Cheniere or Sabine Pass is not able to
address any of its upcoming debt maturities, if the Project
experiences prolonged operating issues or if Sabine Pass's
financial metrics weaken.
Sabine Pass's rating 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 its 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 the issuer's core industry and the issuer's ratings are
believed to be comparable to those of other issuers of similar
credit risk.
Sabine Pass LNG L.P. was formed in 2004 to construct, own and
operate a liquefied natural gas receiving terminal with an
aggregate regasification capacity of 4 Bcf/d. Sabine has signed
three 20-year Terminal Use Agreements for 100% of its
regasification capacity on a "take or pay" basis. Sabine is
90.6%, indirectly-owned by Cheniere Energy, Inc (not rated).
The last rating action on Sabine Pass occurred on September 9,
2008, when the rating on Project's rating was affirmed at B2.
SAM & REALTY: Case Summary & 10 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Sam & Realty, LLC
1820 Ridge Road, Suite 217
Homewood, IL 60430
Bankruptcy Case No.: 10-52220
Chapter 11 Petition Date: November 23, 2010
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: A. Benjamin Goldgar
Debtor's Counsel: Abraham Brustein, Esq.
DIMONTE & LIZAK, LLC
216 W. Higgins Road
Park Ridge, IL 60068
Tel: (847) 698-9600 Ext. 221
Fax: (847) 698-9623
E-mail: abrustein@dimonteandlizak.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 10 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/ilnb10-52220.pdf
The petition was signed by Sam Fakhouri, manager.
SCF PROPERTIES: Case Summary & 17 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: SCF Properties,LLC
219 Hollywood Drive
Metairie, LA 70005
Bankruptcy Case No.: 10-14339
Chapter 11 Petition Date: November 22, 2010
Court: United States Bankruptcy Court
Eastern District of Louisiana (New Orleans)
Judge: Jerry A. Brown
Debtor's Counsel: Phillip K. Wallace, Esq.
PHILIP K. WALLACE, PLC
2027 Jefferson Street
Mandeville, LA 70448
Tel: (985) 624-2824
Fax: (985) 624-2823
E-mail: PhilKWall@aol.com
Scheduled Assets: $2,621,561
Scheduled Debts: $3,147,737
A list of the Company's 17 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/laeb10-14339.pdf
The petition was signed by Sean C. Foto, managing member.
SECURUS TECHNOLOGIES: Sverica Deal Won't Affect Moody's Rating
--------------------------------------------------------------
Moody's Investors Service said that Securus Technologies, Inc.'s
ratings are not affected by the company's sale of Syscon to
private equity firm Sverica International for an undisclosed
amount of cash during the third quarter of 2010, but positive
rating momentum could develop if the company uses the cash to pay
down debt.
The last rating action on Securus Technologies, Inc. was an
upgrade of the company's CFR rating to B3 from Caa2 on April 29,
2010.
Based in Dallas, TX, Securus Technologies, Inc., is one of the
largest providers of inmate telecommunication services to
correctional facilities, with a presence in 44 states and Canada.
The company generated $363 million of revenue for the fiscal year
ended December 31, 2009.
SEMGROUP LP: To Pay $775,000 to Executive as SERP Claim Settlement
------------------------------------------------------------------
The Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware approved the settlement agreement entered
between SemGroup L.P., et al., and William James McCarthy
resolving the claims asserted by Mr. McCarthy.
Mr. McCarthy, an executive, asserted an entitlement of $2 million
arising out of the executive's participation in the SemGroup
Supplement Executive Retirement Plan.
The settlement provides that, among other things:
-- in full and final satisfaction of the claims, Mr. McCarthy
will be allowed a general unsecured claim of $775,000 in
accordance with the terms and conditions of the Fourth
Amended Plan of Affiliated Debtors;
-- in return for the consideration, Mr. McCarthy agreed to
discharge the Debtors from any and all claims; and
-- Mr. McCarthy also agreed not to file a lawsuit of any kind
against the Debtors.
About SemGroup, L.P.
SemGroup, L.P. -- http://www.semgrouplp.com/-- is a midstream
service company that provides diversified services for end users
and consumers of crude oil, natural gas, natural gas liquids and
refined products. Services include purchasing, selling,
processing, transporting, terminalling and storing energy.
SemGroup serves customers in the United States, Canada, Mexico and
Wales.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection (Bankr. D. Del. Case No. 08-11525) on July 22, 2008.
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, represent the Debtors
in their restructuring efforts. 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.
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.
SemGroup, LP, won confirmation from the Bankruptcy Court of its
Fourth Amended Plan of Reorganization on October 28, 2008. The
Plan, distributing more than $2.5 billion in value to
stakeholders, was declared effective on November 30, 2008.
SHUBH HOTELS PITTSBURGH: Wyndham Deal Okayed Despite Objection
--------------------------------------------------------------
An operator of a downtown Pittsburgh hotel that once bore the
Hilton name secured bankruptcy-court approval to rebrand the hotel
as a Wyndham Grand, Dow Jones' Small Cap reports.
According to the report, Judge Jeffery A. Deller of the U.S.
Bankruptcy Court in Pittsburgh authorized Shubh Hotels Pittsburgh
LLC, which is in bankruptcy and which currently operates the 713-
room hotel with "no prominent flag," to enter into a franchise
agreement with Wyndham Hotels and Resorts LLC.
In an opinion, the report notes, the judge acknowledged that Shubh
Hotels Pittsburgh's secured lender objected to the proposed
franchise transaction out of concern that the deal was part of a
scheme by Dr. Kiran Patel, the new man behind Shubh, and his
associates to "kill" the lender's interests.
The judge also noted that Shubh's transactions with Patel and his
associates "raise some eyebrows," the report says.
Evidence introduced during the bankruptcy proceedings, Judge
Deller said, suggests that Patel and his associates controlled the
hotel operations before Shubh entered bankruptcy, the report adds.
Boca Raton, Florida-based Shubh Hotels Pittsburgh, LLC, owns and
operates the Pittsburgh Hilton Hotel. It filed for Chapter 11
bankruptcy protection on September 7, 2010 (Bankr. W.D. Pa. Case
No. 10-26337). Scott M. Hare, Esq., in Pittsburgh, Pennsylvania,
and attorneys at Rudov & Stein, P.C., serve as co-counsel. The
Debtor estimated its assets at $10 million to $50 million and
debts at $50 million to $100 million.
Shubh Hotels Detroit, LLC, filed for Chapter 11 protection on
October 21, 2010 (Bankr. S.D. Fla. Case No. 10-42163). Susan D.
Lasky, Esq., at Susan D. Lasky, PA, in Wilton Manors, Florida,
represents the Debtor. The Debtor estimated up to $50,000 in
assets and debts of $10,000,001 to $50,000,000 in the Chapter 11
petition.
SPUR ENTERPRISES: Case Summary & 6 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Spur Enterprises, LP
aka Mowod Enterprises, Inc.
aka Mowod Enterprises, LP
aka Spurs Enterprises, Inc.
aka Spur Enterprises, LP
aka Spur Enterprises, Inc.
2773 Sidney Street
Pittsburgh, PA 15203
Bankruptcy Case No.: 10-28293
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Western District of Pennsylvania (Pittsburgh)
Debtor's Counsel: Donald R. Calaiaro, Esq.
CALAIARO & CORBETT, P.C.
Grant Building, Suite 1105
310 Grant Street
Pittsburgh, PA 15219-2230
Tel: (412) 232-0930
Fax: (412) 232-3858
E-mail: dcalaiaro@calaiarocorbett.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's six largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/pawb10-28293.pdf
The petition was signed by Roy D. Davis, president.
STILLWATER MINING: To Proceed With Two Mine Projects in Montana
---------------------------------------------------------------
Stillwater Mining Company said it plans to proceed with two mine
resource delineation and development projects along the Stillwater
Complex: the Graham Creek Project, immediately to the west of the
Company's East Boulder Mine, and the Blitz Project, immediately to
the east of the Company's Stillwater Mine.
Both projects lie within the boundaries of existing mining
permits, and each would initially be serviced from existing mine
infrastructure. Based on indications from historical surface
delineation drilling in these areas, both proposed projects are
viewed by the Company as having a high probability of ultimately
adding significantly to the Company's probable PGM reserves.
Announcement of these projects fits well with the Company's
pending acquisition of the Marathon PGM/Copper project located
near the town of Marathon, Ontario, Canada, located at the north
end of Lake Superior. As was announced earlier this week, the
Marathon acquisition was overwhelmingly approved by Marathon
shareholders at a general shareholder meeting this past Monday.
Completion of planned permitting and development efforts at
Marathon is expected to take about three years.
Over the next several years, the Graham Creek project aims to
extend development of the East Boulder Mine ore resource about
7,900 feet further to the west. East Boulder Mine's tunnel boring
machine, which was used about a decade ago to develop initial
access to the JM Reef and then the west footwall lateral access
paralleling the mineralized JM reef, has recently been re-
commissioned for this new project. Initial work will assess the
continuity and structural controls related to the JM Reef in this
area on the far western end of the Stillwater Complex.
Based upon historical surface drilling and production experience
to date at East Boulder, the project potentially could develop
over time up to 6 million additional tons of ore grading on the
order of 0.41 in-situ ounces per ton. Once the initial
development is completed, any future mining in this area would
require adding ventilation raises and additional infrastructure
prior to beginning ore production. Costs to complete the TBM
development drive and assess the PGM resource for the Graham Creek
area are projected at about $8 million over the next five years.
The project is expected to yield information on the Graham Creek
resource as diamond drilling work is completed behind the TBM
drive.
The Blitz project at the Stillwater Mine is designed to explore
and define the PGM resource along the far eastern extent of the JM
Reef. It will extend some 13,500 feet to the east of the existing
Stillwater Mine via two conventionally driven footwall laterals
from the 5000 and 5600 levels. Diamond drilling and geologic
evaluation will be concurrent with footwall lateral advance on
both levels.
Once the Blitz assessment project is completed, additional
development will require excavating new ventilation raises to
support bulk sampling, final pre-production development and
eventual ore production. Based upon production experience to date
and historical surface drilling, we believe the project has the
potential over time to define up to 9.5 million additional tons of
resource grading on the order of 0.71 ounces per ton. The project
will begin to yield resource results within its first couple of
years. Initial development and resource evaluation costs for the
Blitz area are expected to total about $60 million to be spent
over the next five or six years.
Commenting on the projects, Francis R. McAllister, Stillwater's
Chairman and CEO, said, "Earlier this year we produced and
published in our annual report an analysis entitled, The Case for
Palladium. Based upon the report's conclusions regarding the
outlook for palladium, we have taken a number of actions,
including commissioning an internal engineering team to study
tactical and strategic opportunities to develop new production
along the Stillwater Complex.
"Historical surface drilling along the 28-mile extent of the
Stillwater Complex confirmed continuous palladium and platinum
mineralization essentially along the full extent of the JM Reef,
but extensive portions of the reef still await more detailed
delineation. The team reviewed the historical data and identified
several potential resource development projects along the
Stillwater Complex, of which the Graham Creek and Blitz projects
were considered the most promising."
Concluding, McAllister added, "These two projects, coupled with
the recent acquisition of the Marathon PGM/Copper project in
Canada and the new recycling facilities commissioned in 2010
provide a robust growth profile for Stillwater over the next few
years."
About Stillwater Mining
Billings, Montana-based Stillwater Mining Company --
http://www.stillwatermining.com/-- is the only U.S. producer of
palladium and platinum and is the largest primary producer of
platinum group metals outside of South Africa and Russia. The
Company's shares are traded on the New York Stock Exchange under
the symbol "SWC."
The Company's balance sheet at $778.23 million in total assets,
$287.90 million in total liabilities, and stockholder's holders
equity of $490.33 million.
Stillwater carries 'Caa1' corporate family and probability of
default ratings, with 'stable' outlook, from Moody's Investors
Service. It has 'B' issuer credit ratings from Standard & Poor's.
SUSAN MCKENZIE: Case Summary & 10 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Susan Boston McKenzie
P.O. Box 1553
Pinehurst, NC 28370
Bankruptcy Case No.: 10-82145
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Middle District of North Carolina (Durham)
Debtor's Counsel: Gregory Byrd Crampton, Esq.
3700 Glenwood Ave., Ste. 500
Raleigh, NC 27612
Tel: (919) 781-1311
Fax: (919) 782-0465
E-mail: gcrampton@nichollscrampton.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $100,001 to $500,000
A list of the Debtor's 10 largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/ncmb10-82145.pdf
SWIFT TRANSPORTATION: Moody's Raises Corp. Family Rating to 'B3'
----------------------------------------------------------------
Moody's Investors Service raises its ratings for Swift
Transportation Co, LLC, corporate family rating to B3 from
Caa1. Swift's ratings have a positive outlook.
Upgrades:
Issuer: Swift Transportation Co., LLC
-- Probability of Default Rating, Upgraded to B3 from Caa1
-- Corporate Family Rating, Upgraded to B3 from Caa1
-- Senior Secured Bank Credit Facility, Upgraded to B2 from B3
-- Senior Secured Regular Bond/Debenture, Upgraded to Caa2 from
Caa3
Ratings Rationale
The ratings were raised in recognition of the company's
strengthening financial performance, which can be attributed to
improvements in Swifts trucking operations as well as to an
improving trend in industry freight volumes and yields that are
now taking traction. As industry conditions improve, Swift should
be able to expand operating margins, while generating cash to
support fleet investments and debt service. However, the B3
rating also takes into account the sizeable debt levels resident
in the company's current capital structure. As of September 30,
2010, Swift had total debt (including Moody's standard
adjustments, primarily relating to operating expenses) of almost
$3 billion, which represents over 100% of the company's annual
revenues. For the LTM September 2010 period, the company showed
Debt to EBITDA of approximately 5.6 times, Retained Cash Flow to
Debt of 6%, and EBIT to Interest of less than 1.0 time. These
figures are somewhat weak for the B3 rating, but are expected to
improve through 2011 in a modest growth and yield environment to
levels supportive of the current rating.
The positive ratings outlook is primarily a reflection on the
potential for substantial debt reduction that would ensue from the
company's planned initial public offering of equity. As announced
in recent public filings and company releases, Swift intends to
use all proceeds from a contemplated $1 billion IPO, along with an
unspecified amount of a new senior secured credit facility and
senior notes, to repay existing debt. Once completed, the
application of a substantial majority of the IPO proceeds (less
payment of transaction fees and to settle interest rate swaps
relating to existing debt) towards debt repayment would likely
result in a substantial amount of deleveraging at Swift. Moody's
expects that the new debt raised in the refinancing will also
lengthen Swift's debt maturity profile. With the potential for
total debt to be reduced by nearly one-third, pro forma ratings
could improve to levels that would support a B2 corporate family
rating.
Ratings could be raised if Swift were to complete the IPO as
planned, arranging new debt financing, and reducing debt by at
least $600 million. Under that scenario, pro forma the IPO and
debt restructuring, Swift's Debt to EBITDA could be lowered to
under 4.5 times and EBIT to Interest increased to over 1.3 times.
However, if the company does not complete the IPO and refinancing,
the ratings outlook would likely be changed to stable from
positive with the B3 CFR affirmed, since Moody's believes that
credit metrics could not improve materially enough over the near
term for further ratings upgrades under the company's current debt
structure.
Swift'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 its industry, ii) the capital structure and
financial risk of the company, iii) Moody's projections of the
company's performance 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 Swift's core industry and Swift's ratings are believed
to be comparable to those of other issuers of similar credit risk.
The last rating action was on September 15, 2010, when Moody's
changed the ratings outlook to positive from negative.
Swift Transportation Co, LLC, headquartered in Phoenix, Arizona,
is one of the largest providers of truckload transportation
services in the United States, with line-haul, dedicated and
inter-modal freight services.
TC GLOBAL: Walter Schoenfeld Resigns as Director
------------------------------------------------
TC Global Inc., dba Tully's Coffee, said that Walter Schoenfeld
resigned as a director effective November 17, 2010, for personal
reasons.
About Tully's Coffee
Headquartered in Seattle, Washington, TC Global, Inc., dba Tully's
Coffee -- http://www.tullyscoffeeshops.com/-- is a specialty
coffee retailer and wholesaler. Through company owned, licensed
and franchised specialty retail stores in Washington, Oregon,
California, Arizona, Idaho, Montana, Colorado, Wyoming and Utah,
throughout Asia with Tully's Coffee International, and with its
global alliance partner Tully's Coffee Japan, Tully's premium
coffees are available at 545 branded retail locations globally.
TC Global also has the rights to distribute Tully's coffee through
all wholesale channels internationally, outside of North America,
the Caribbean and Japan.
The Company's balance sheet at Sept. 30, 2010, showed
$10.13 million in total assets, $15.94 million in total
liabilities, and a stockholders' deficit of $5.82 million.
TC Global reported a net loss of $1.59 million on $9.20 million of
net sales for the thirteen weeks ended Sept. 26, 2010, compared
with a net loss of $1.27 million of $9.78 million for the thirteen
weeks ended Sept. 27, 2009.
TELKONET INC: Shareholders OK All Proposals at Annual Meeting
-------------------------------------------------------------
Telkonet Inc. held its Annual Meeting of Stockholders on November
17, 2010. The Company provided these information regarding the
results of the matters voted on by stockholders at the Annual
Meeting:
a) Election of four Directors to serve for the ensuing year and
until their successors are elected:
Director Nominee Votes For Votes Withheld Broker Non-votes
---------------- --------- -------------- ----------------
Anthony J. Paoni 31,363,739 1,703,792 54,366,044
Jason L. Tienor 32,092,565 974,966 54,366,044
Joseph D. Mahaffey 32,095,935 971,596 54,366,044
William H. Davis 31,735,171 1,332,360 54,366,044
b) Approval of an amendment to the Telkonet, Inc. Amended and
Restated Articles of Incorporation, as amended, to increase the
number of authorized shares of Company common stock from
155,000,000 to 190,000,000
-- 78,367,129 shares in favor, 8,298,672 shares against, and
767,774 shares abstaining.
c) Approval of the Telkonet, Inc. 2010 Stock Option and Incentive
Plan
-- 30,456,885 shares in favor, 2,119,039 shares against,
491,607 abstaining, and 54,366,044 Broker Non-votes.
d) Ratification of the appointment of RBSM, LLP as the Company's
independent registered public accounting firm for the year
ended December 31, 2010
-- 83,229,618 shares in favor, 1,236,575 shares against, and
2,967,382 shares abstaining.
About Telkonet
Milwaukee, Wisconsin-based Telkonet, Inc. is a clean technology
company that develops and manufactures proprietary energy
efficiency and smart grid networking technology.
The Company's balance sheet at Sept. 30, 2010, showed $16.33
million in total assets, $6.15 million in total liabilities, $2.79
million in total long-term liabilities, and stockholders' equity
of $5.95 million.
RBSM LLP, in New York, expressed substantial doubt about the
Company's ability to continue as a going concern, following the
Company's 2009 results. The independent auditors noted that of
the Company's significant operating losses in the current year and
in the past.
TEMPUS RESORTS: Wants to Use Resort Finance's Cash Collateral
-------------------------------------------------------------
Tempus Resorts International, Ltd., et al., seek authority from
the U.S. Bankruptcy Court for the Middle District of Florida to
use of Resort Finance America's cash collateral.
The Debtor owes RFA approximately $17,081,898. RFA asserts that
it holds a lien, in part, on leases, rents, and income related to
certain of the Debtor's inventory. RFA doesn't consent to the
Debtors' use of cash collateral, and demands for sequestration of
the cash collateral.
Jimmy D. Parrish, Esq., at Baker & Hostetler LLP, explained that
the Debtors need to use $64,099 of cash collateral until February
20, 2011 to fund their Chapter 11 case, pay suppliers and other
parties. The Debtors will use the collateral pursuant to a
budget, a copy of which is available for free at:
http://bankrupt.com/misc/TEMPUS_RESORTS_budget.pdf
In exchange for using the cash collateral, the Debtors propose to
grant RFA a replacement lien to the same validity, extent, and
priority as their respective prepetition liens.
As additional adequate protection, the Debtors will provide
regular financial reports including: (i) any reports required
under the respective loan documents with RFA; and (ii) a summary
reports of actual cash flows compared to the budget with
explanations of material variances to be provided on Wednesday for
the prior calendar week.
RFA is represented by Shutts & Bowen LLP.
Orlando, Florida-based Tempus Resorts International, Ltd., filed
for Chapter 11 bankruptcy protection on November 19, 2010 (Bankr.
M.D. Fla. Case No. 10-20709). Elizabeth A. Green, Esq., at Baker
& Hostetler LLP, assists the Debtor in its restructuring effort.
It estimated its assets and debts at $100 million to $500 million.
Affiliates Tempus Palms International, Ltd. (Bankr. M.D. Fla. Case
No. 10-20712); Tempus Golf Development, LLC (Bankr. M.D. Fla. Case
No. 10-20714); Tempus Select, LLC (Bankr. M.D. Fla. Case No. 10-
20715); Backstage Myrtle Beach, LLC (Bankr. M.D. Fla. Case No. 10-
20716); Tempus Resorts Management, Ltd. (Bankr. M.D. Fla. Case No.
10-20717); Tempus Resorts Realty, LLC (Bankr. M.D. Fla. Case No.
10-20718); Tempus International Marketing Enterprises, Ltd.
(Bankr. M.D. Fla. Case No. 10-20719); and Time Retail, LLC (Bankr.
M.D. Fla. Case No. 10-20720) filed separate Chapter 11 petition.
Tempus Resorts estimated its assets and debts at $100,000 to
$500,000. Tempus Golf Debt. Estimated its assets and debts at
$1 million to $10 million. Tempus Palms International estimated
its assets at $100 million to $500 million.
TERESA DIAZ: Voluntary Chapter 11 Case Summary
----------------------------------------------
Joint Debtors: Teresa L. Diaz
Jeffrey A. Diaz
1293 Donahue Court
Pleasanton, CA 94566
Bankruptcy Case No.: 10-73470
Chapter 11 Petition Date: November 22, 2010
Court: U.S. Bankruptcy Court
Northern District of California (Oakland)
Judge: Roger L. Efremsky
Debtors' Counsel: Joel K. Belway, Esq.
LAW OFFICES OF JOEL K. BELWAY
235 Montgomery Street, #668
San Francisco, CA 94104
Tel: (415) 788-1702
E-mail: belwaypc@pacbell.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Joint Debtors did not file a list of creditors together with
its petition.
TERRESTAR NETWORKS: Gets OK for Fraser Milner as Canadian Counsel
-----------------------------------------------------------------
TerreStar Networks Inc. and its units obtained approval from the
U.S. Bankruptcy Court for authority to employ Fraser Milner
Casgrain LLP as their Canadian counsel to represent them on all
Canadian issues in connection with their ongoing restructuring
efforts in the Chapter 11 cases and the proceedings pursuant to
the Companies' Creditors Arrangement Act in the Ontario Superior
Court of Justice (Commercial List) in Toronto, Ontario, Canada,
nunc pro tunc to the Petition Date.
The Debtors relate that they have selected Fraser Milner as their
Canadian counsel because of the firm's institutional knowledge of
their businesses and financial affairs and the firm's recognized
expertise in cross-border reorganizations.
Fraser Milner will render these professional services on behalf
of the TerreStar Canada Debtors, as applicable, among others:
(a) represent TerreStar Networks, Inc. as the proposed foreign
representative in the Canadian Proceeding;
(b) advise the Debtors with respect to Canadian issues
impacting their rights, powers and duties in the Chapter
11 cases and the Canadian Proceeding;
(c) assist and advise the Debtors and take all necessary or
appropriate actions at the Debtors' direction with respect
to Canadian issues that relate to protecting and
preserving the Debtors' estates, including the defense of
any actions commenced against the Debtors in Canada, and
the negotiation of Canadian disputes in which the Debtors
are involved;
(d) draft all necessary or appropriate motions, applications,
answers, orders, reports, and other papers in connection
with the administration of the Canadian Proceeding;
(e) represent the Debtors in negotiations with Canadian
governmental or quasigovernmental authorities or other
parties-in-interest as it relates to Canadian issues
affecting the estates;
(f) appear on behalf of TerreStar Networks Inc. as the
proposed foreign representative at all hearings and other
proceedings in the Canadian Proceeding;
(g) assist and advise the Debtors with respect to any legal
issue which may arise in the context of their relationship
with the TerreStar Canada Debtors;
(h) take all necessary or appropriate actions as directed by
the Debtors in connection with developing and negotiating
a plan or plans of reorganization and related disclosure
statements and all related documents, and other further
actions as may be required in connection with the
administration of the Debtors' estates and the Canadian
Proceeding; and
(i) perform other legal services as the Debtors may require in
connection with the Chapter 11 cases and the Canadian
Proceeding.
The Debtors propose to pay Fraser Milner according to the firm's
standard hourly rates, which currently are:
-- $475 to $1,000 for partners and senior consultants;
-- $310 to $500 for associates; and
-- $100 to $320 for paraprofessionals, including articling
students.
The current hourly rates for the Fraser Milner lawyers with
primary responsibility in the Debtors' cases are:
Professional Position Hourly Rate
------------ -------- -----------
Alex L. MacFarlane Partner - Insolvency $750
and Restructuring
Michael J. Wunder Partner - Insolvency $750
and Restructuring
Ryan C. Jacobs Counsel - Insolvency $600
and Restructuring
Kirsten Embree Partner - Communications $525
Jarvis Hetu Associate - Insolvency $310
and Restructuring
In addition, the Debtors seek to reimburse Fraser Milner for the
firm's all actual and necessary out-of-pocket expenses incurred,
including, but not limited to, photocopying services, printing,
delivery charges, filing fees, postage, and computer research
time.
Michael J. Wunder, Esq., a partner at Fraser Milner, assures the
Court that his firm is a "disinterested person" as the term is
defined under Section 101(14) of the Bankruptcy Code.
About TerreStar Networks
Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.
TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices. This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure. The
Company intends to provide multiple communications applications,
including voice, data and video services.
As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc. Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.
TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).
The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.
The Garden City Group, Inc., will act as claims and noticing agent
in the Chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq.,
and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira
Dizengoff, Esq., Arik Preis, Esq., and Ashleigh Blaylock, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, serve as bankruptcy
counsel to the Debtors. Blackstone Advisory Partners LP is the
financial advisor.
Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TERRESTAR NETWORKS: Gets OK for Stikeman as Canadian Counsel
------------------------------------------------------------
TerreStar Networks Inc. and its U.S. affiliates received approval
from the U.S. Bankruptcy Court to employ Stikeman Elliott LLP as
Canadian counsel for the TerreStar Canada Debtors nunc pro tunc to
the Petition Date.
The TerreStar U.S. Debtors note that they are contemporaneously
seeking to retain Fraser Milner Casgrain LLP as their Canadian
counsel to represent them -- other than the TerreStar Canada
Debtors -- on all Canadian issues in connection with their
ongoing restructuring efforts in the Chapter 11 cases and the
Canadian Proceeding, as well as to act as counsel to TerraStar
Networks, Inc. as the proposed foreign representative in the
Canadian Proceeding.
The TerreStar Canada Debtors -- TerreStar Networks Holdings
(Canada) Inc. and TerreStar Networks (Canada) Inc. -- are not
majority owned nor controlled by TSN. TSN has a minority
interest in the TerreStar Canada Debtors. Accordingly, the
TerreStar Canada Debtors need Stikeman as Canadian counsel to
provide them independent legal advice in connection with the
Chapter 11 cases and in the Canadian Proceeding.
The representation of the TerreStar Canada Debtors by distinct
Canadian counsel is required and appropriate in the circumstances
given, inter alia, that the TerreStar Canada Debtors and the
other Debtors do not have the same majority and controlling
shareholders, Jeffrey Epstein, TerreStar Networks, Inc.'s
president and chief executive officer, relates. "The appointment
of a distinct Canadian counsel is required for the proper
exercise of the fiduciary duties of the directors of the
TerreStar Canada Debtors."
The TerreStar Canada Debtors relate that they have selected
Stikeman as their Canadian counsel because of the firm's
institutional knowledge of their businesses and financial affairs
and the firm's recognized expertise in cross-border
reorganizations.
As Canadian Counsel, Stikeman Elliott will:
(a) advise the TerreStar Canada Debtors with respect to
Canadian issues impacting their rights, powers and duties
in these cases and in the Canadian Proceeding;
(b) assist and advise the TerreStar Canada Debtors and take
all necessary or appropriate actions at the TerreStar
Canada Debtors' direction with respect to Canadian issues
that relate to protecting and preserving the TerreStar
Canada Debtors' estates, including the defense of any
actions commenced against the TerreStar Canada Debtors in
Canada, and the negotiation of disputes in Canada in which
the TerreStar Canada Debtors are involved;
(c) represent the TerreStar Canada Debtors in negotiations
with Canadian governmental or quasi-governmental
authorities or other parties-in-interest as it relates to
Canadian issues affecting their estates;
(d) assist and advise the TerreStar Canada Debtors with
respect to any legal issue which may arise in the context
of their relationship with TSN, including, without
limitation, as shareholder of the TerreStar Canada
Debtors;
(e) take all necessary or appropriate actions as directed by
the TerreStar Canada Debtors in connection with developing
and negotiating a plan or plans of reorganization and
related disclosure statement(s) and all related documents,
and further actions as may be required in connection with
the administration of the TerreStar Canada Debtors'
estates in the cases and in the Canadian Proceeding; and
(f) perform other legal services as the TerreStar Canada
Debtors may require in connection with the cases and in
the Canadian Proceeding.
The Debtors propose to pay Stikeman Elliott's services at the
firm's standard hourly rates, which currently are:
-- C$475 to C$1,000 for partners and senior counsel;
-- C$240 to C$700 for associates; and
-- C$150 to C$390 for paraprofessionals including articling
students.
The current hourly rates for the Stikeman lawyers with primary
responsibility for the matter are:
Professional Position Hourly Rate
------------ -------- -----------
Sidney M. Horn Partner - Corporate C$925
and Commercial
Sean F. Dunphy Partner - Insolvency C$940
and Restructuring
Claire Zikovsky Partner - Corporate C$650
and Commercial
Guy P. Martel Partner - Insolvency C$625
and Restructuring
Claire Zikovsky, Esq., a member of Stikeman Elliott, assures the
Court that her firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
About TerreStar Networks
Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.
TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices. This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure. The
Company intends to provide multiple communications applications,
including voice, data and video services.
As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc. Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.
TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).
The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.
The Garden City Group, Inc., will act as claims and noticing agent
in the Chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq.,
and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira
Dizengoff, Esq., Arik Preis, Esq., and Ashleigh Blaylock, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, serve as bankruptcy
counsel to the Debtors. Blackstone Advisory Partners LP is the
financial advisor.
Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TERRESTAR NETWORKS: Wins Approval for Akin Gump as Bankr. Counsel
-----------------------------------------------------------------
TerreStar Networks Inc. and its units sought and obtained the U.S.
Bankruptcy Court for the Southern District of New York's authority
to employ Akin Gump Strauss Hauer & Feld LLP as their attorneys
nunc pro tunc to the Petition Date.
Jeffrey Epstein, TerreStar Networks, Inc.'s president and chief
executive officer, relates that the Debtors have selected Akin
Gump to serve as their attorneys because of the firm's knowledge
of their business and financial affairs and the firm's extensive
general experience and institutional knowledge, and, in
particular, its recognized expertise with business
reorganizations under Chapter 11 of the Bankruptcy Code.
The Debtors propose to employ Akin Gump to render these services:
a. Advise the Debtors with respect to their powers and duties
as debtors-in-possession in the continued operation of
their business and the management of their properties;
b. Advise the Debtors and take all necessary or appropriate
actions at the Debtors' direction with respect to
protecting and preserving the Debtors' estates, including
the defense of any actions commenced against the Debtors,
the negotiation of disputes in which the Debtors are
involved, and the preparation of objections to claims filed
against the Debtors' estates;
c. Draft all necessary or appropriate motions, applications,
answers, orders, reports, and other papers in connection
with the administration of the Debtors' estates on behalf
of the Debtors;
d. Represent the Debtors in negotiations with all other
creditors, equity holders, and other parties-in-interest,
including governmental authorities;
e. Advise the Debtors with respect to the cross-border issues
in the Chapter 11 cases;
f. Take all necessary or appropriate actions in connection
with a plan or plans of reorganization and related
disclosure statement and all related documents, and the
further actions as may be required in connection with the
administration of the Debtors' estates; and
g. Perform and advise the Debtors as to all other necessary
legal services in connection with the Chapter 11 cases,
including, without limitation, any general corporate legal
services.
Akin Gump will work closely with Fraser Milner Casgrain LLP and
Stikeman Elliot LLP, Canadian counsel to the Debtors, and any
other professionals that may be employed by the Debtors. Akin
Gump will take whatever steps are necessary and appropriate to
avoid any unnecessary duplication of services with other
professionals.
The Debtors propose to pay Akin Gump at its standard hourly rates
which currently are:
-- $525 to $1,150 for partners,
-- $475 to $835 for counsel,
-- $325 to $600 for associates, and
-- $125 to $290 for paraprofessionals.
The current hourly rates for Akin Gump's attorneys with primary
responsibility in the Debtors' Chapter 11 cases are:
-- Ira S. Dizengoff, Partner for Finc'l. Restructuring, $950
-- Russell W. Parks Jr., Partner for Corporate, $880
-- Arik Preis, Counsel for Financial Restructuring, $675
-- Joanna Newdeck, Counsel for Financial Restructuring), $575
-- Ashleigh L. Blaylock, Associate-Finc'l Restructuring, $430
-- Kelly Labritz, Senior Attorney-Corporate, $575
In addition, the Debtors seek to reimburse all of Akin Gump's
actual and necessary expenses that are incurred in connection
with the contemplated representation, including, but not limited
to, photocopying services, printing, delivery charges, filing
fees, postage, and computer research time.
Ira S. Dizengoff, Esq., a member of Akin Gump, assures the Court
that his firm is a "disinterested person" within the meaning of
Section 101(14) of the Bankruptcy Code.
About TerreStar Networks
Reston, Va.-based TerreStar Corporation (NASDAQ: TSTR)
-- http://www.terrestar.com/-- is in the mobile communications
business through its ownership of TerreStar Networks, its
principal operating subsidiary, and TerreStar Global.
TerreStar Networks, in cooperation with its Canadian partners,
TerreStar Canada and TerreStar Solutions, majority-owned
subsidiaries of Trio 1 and 2 General Partnerships, plans to launch
an innovative wireless communications system to provide mobile
coverage throughout the United States and Canada using integrated
satellite-terrestrial smartphones and other devices. This system
build out will be based on an integrated satellite and ground-
based technology intended to provide communication service in most
hard-to-reach areas and will provide a nationwide interoperable,
survivable and critical communications infrastructure. The
Company intends to provide multiple communications applications,
including voice, data and video services.
As of June 30, 2010, the Company had four wholly owned
subsidiaries, MVH Holdings Inc., Motient Holdings Inc., TerreStar
Holdings Inc., and TerreStar New York Inc. Motient Ventures
Holding Inc., a wholly owned subsidiary of MVH Holdings Inc.,
directly holds approximately 89.3% and 86.5% interest in TerreStar
Networks and TerreStar Global, respectively.
TerreStar Networks Inc. and Its affiliates filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in Manhattan (Bankr. S.D.N.Y. Lead Case No.
10-15446).
The Debtors' parent, TerreStar Corporation (NASDAQ: TSTR), is not
among the Chapter 11 filers.
The Garden City Group, Inc., will act as claims and noticing agent
in the Chapter 11 cases. Michel Wunder, Esq., Ryan Jacobs, Esq.,
and Jarvis Hetu, Esq. at Fraser Milner Casgrain LLP and Ira
Dizengoff, Esq., Arik Preis, Esq., and Ashleigh Blaylock, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, serve as bankruptcy
counsel to the Debtors. Blackstone Advisory Partners LP is the
financial advisor.
Bankruptcy Creditors' Service, Inc., publishes TerreStar
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by TerreStar Networks Inc. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TEXAS COMPETITIVE: Completes Issuance of $885-Mil. 2nd Lien Notes
-----------------------------------------------------------------
Texas Competitive Electric Holdings Company LLC, as issuer, a
wholly-owned subsidiary of Energy Future Competitive Holdings
Company, and TCEH Finance, Inc., a direct, wholly-owned subsidiary
of TCEH, completed on November 15, 2010, a private exchange
transaction pursuant to an Exchange Agreement among the Issuer,
EFCH, the subsidiary guarantors named therein and an institutional
investor.
In the Exchange Transaction, the Issuer issued approximately
$885 million aggregate principal amount of its 15% Senior Secured
Second Lien Notes due 2021, Series B in exchange for the surrender
by certain funds and accounts managed by the Exchange Holder of
approximately $1.27 billion aggregate principal amount of the
Issuer's 10.25% Senior Notes due 2015 and 10.50%/11.25% Senior
Toggle Notes due 2016. The notes received by the Issuer in the
Exchange Transaction have been retired and canceled.
On November 12, 2010, Texas Competitive Electric Holdings Company
LLC and TCEH Finance Inc., a direct, wholly-owned subsidiary of
TCEH, entered into an agreement with an institutional investor
pursuant to which the Companies agreed to exchange approximately
$884 million aggregate principal amount of its 15% Senior Secured
Second Lien Notes due 2021, Series B plus accrued and unpaid
interest on certain of the Old Notes for approximately $1.27
billion aggregate principal amount of the the Companies' 10.25%
Senior Notes due 2015, the the Companies' 10.25% Senior Notes due
2015, Series B, and the the Companies' 10.50%/11.25% Senior Toggle
Notes due 2016 held by certain managed funds and accounts of the
Exchange Holder. The closing of the exchange is subject to
customary closing conditions.
The New Notes will be issued pursuant to the Indenture, dated as
of October 6, 2010, as supplemented by the First Supplemental
Indenture thereto, dated as of October 20, 2010, and as it will be
supplemented by the Second Supplemental Indenture thereto to be
dated as of the closing date of the exchange, in each case, among
the Issuer, the guarantors party thereto and The Bank of New York
Mellon Trust Company, N.A., as trustee.
The terms of the New Notes will be identical in all material
respects to the the Companies' outstanding 15% Senior Secured
Second Lien Notes due 2021, Series B. A description of the
material terms of the Series B Notes is contained in the Form 8-K
filed by Energy Future Holdings Corp. and Energy Future
Competitive Holdings Company with the Securities and Exchange
Commission on October 26, 2010.
About Energy Future
Energy Future Holdings Corp. (formerly TXU Corp.), is a Dallas-
based energy company that manages a portfolio of competitive and
regulated energy businesses in Texas. EFH Corp. is a holding
company conducting its operations principally through its
subsidiaries, Texas Competitive Electric Holdings Company LLC
(formerly TXU Energy Company LLC), Oncor Electric Delivery Company
LLC and their subsidiaries.
* * *
According to the Troubled Company Reporter on Oct. 20, 2010,
Fitch Ratings has assigned a rating of 'B/RR2' to Texas
Competitive Electric Holdings Company LLC's issuance of
$350 million 15% senior secured second lien notes due 2021, series
B. The Rating Outlook is Negative.
TIERRA DEL SOL: Case Summary & Largest Unsecured Creditor
---------------------------------------------------------
Debtor: Tierra Del Sol Apartments, LLC
631 S. Olive Street, Suite 860
Los Angeles, CA 90014
Bankruptcy Case No.: 10-59984
Chapter 11 Petition Date: November 22, 2010
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Alan M. Ahart
Debtor's Counsel: Steven E. Glass, Esq.
1870 Verdugo Loma Drive, Suite C
Glendale, CA 91208
Tel: (818) 243-6776
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Shashikant Jogani, general partner of
Westview, L.P., manager.
The list of unsecured creditors filed together with its petition
contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Saumil Dave Services Rendered $15,000
631 S. Olive Street, Suite 860
Los Angeles, CA 90014
TIMBERLAKE FINANCIAL: S&P Downgrades Rating on Notes to 'BB'
------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its rating
on the notes issued by Timberlake Financial LLC to 'BB' from 'BBB'
and removed the rating from CreditWatch, where it was placed on
Aug. 18, 2010, with negative implications.
This rating action reflects S&P's view that Timberlake, a wholly
owned subsidiary of Reinsurance Co. of Missouri (a subsidiary of
Reinsurance Group of America Inc.), is at risk of missing a
scheduled payment. Because of investment losses -- both realized
and on a mark-to-market basis -- Timberlake Re has less cushion to
absorb unfavorable performance of the ceded term life insurance
policies. Since issuance, the actual mortality of these policies
has been somewhat higher than expected, and lapses have been lower
than expected, both of which are modestly adverse to the
performance of the transaction.
When the structure is run through the baseline scenario (i.e.,
mortality, lapsation, asset defaults, and investment income emerge
as expected), Timberlake does not miss any payments on the notes.
However, when the structure is run through certain stress
scenarios (mortality slightly higher than expected, lapses
slightly lower than expected, 100% lapse at the end of the level
term of the policy), scheduled payments are missed. The model
indicated that the lack of future profitability related to 100% of
lapses at the end of the level term did have a significant impact
on the results. Although this scenario might be considered
extreme, failing this test is inconsistent with an investment-
grade rating.
S&P will monitor the transaction to see how performance develops.
If the actual experience is less severe than the modeled stress
tests, S&P could consider raising the rating. However, any
upgrade would likely be at least two years away.
At closing, Timberlake purchased from Timberlake Re a surplus
note. Payments received under the note are used to make payments
on the rated notes. Because of the reinsurance obligations of
Timberlake Re, the company can retain funds to meet these
obligations thus not use them to make payments on the surplus
note. The notes are wrapped by a financial guarantee insurance
policy issued by Ambac Assurance Corp., which is currently rated
'R'. As a result, S&P does not foresee any ratings enhancement
from this policy.
Ratings List
CreditWatch/Outlook Action
Timberlake Financial LLC
To From
-- ----
Senior Secured Debt BB BBB/Watch Neg
TOYS 'R' US: Fitch Retains Positive Watch on 'B' Issuer Rating
--------------------------------------------------------------
Fitch Ratings maintains the Rating Watch Positive for Toys 'R' Us,
Inc., and its various subsidiary entities pending the outcome of
the company's initial public offering announced in May 2010. The
IPO registration is currently active although Fitch expects the
timing of the IPO will be likely postponed to 2011 given the
approaching holiday season and its importance to Toys' business as
approximately 43% of sales and almost 100% of operating profit are
generated in the fourth quarter.
The estimated size of around $800 million and the expected use of
the net proceeds have not changed. In connection with the IPO,
the company and its equity sponsors (Bain Capital Partners LLC,
Kohlberg Kravis Roberts & Co., L.P., and Vornado Realty Trust)
intend to terminate the advisory agreement in which the sponsors
provided management and advisory services to Toys. The agreement
was put in place at the closing of the 2005 acquisition. Upon the
completion of the IPO, Toys will pay a termination fee to the
sponsors. The remaining balance of the net proceeds of the
offering will be used primarily for debt repayment, which Fitch
expects will result in leverage (adjusted debt/EBITDAR) decreasing
to below 5.5 times for fiscal 2011 ending Jan. 28, 2012, from 6.4x
at July 31, 2010.
With the completion of the IPO, Fitch expects the IDRs could be
upgraded to 'B+' as a substantial portion of the proceeds are
expected to be used for debt reduction. In addition, certain of
the recovery ratings will be adjusted to reflect a higher recovery
rate for the remaining debt securities in the capital structure.
The ratings continue to reflect Toys' successful operating
strategy which resulted in improved operating results and credit
metrics in the last 12 months ending July 31, 2010 despite the
challenging operating environment. The ratings also reflect
Fitch's expectation for further strengthening of credit metrics in
fiscal 2010 and fiscal 2011 with positive free cash flow
generation and improved liquidity. This is balanced by the
intense competition in the toy retailing sector and the highly
seasonal nature of Toys' business.
Toys' first half fiscal 2010 revenues increased 2.6% compared to
the first half fiscal 2009 ending Aug. 1, 2009. The increased
penetration of higher margin private label products combined with
inventory controls resulted in a 30 basis points improvement in
the gross margin to 36.8% year over year. This combined with a
debt reduction of $212 million caused LTM leverage (adjusted
debt/EBITDAR) to decline year over year to 6.4x from 6.9x.
Fitch expects Toys' adjusted debt/EBITDAR will continue to improve
in fiscal 2010 to below 6.0x based on the assumption of around 1%-
2% sales growth and a 20 basis point operating EBIT margin
expansion. This is expected to be achieved through the company's
continued rollout of side-by-side store conversions, expansion of
its internet business by integrating online and store capabilities
and launching e-commerce sites in international markets, and the
continued implementation of holiday pop-up stores. Also, Toys'
profit margins should continue to benefit from an increase in
exclusive and private label products, ongoing supply chain
efficiencies such as direct sourcing and cost control efforts such
as the alignment of store staffing hours with traffic into the
stores.
Toys' liquidity is supported by $176 million of cash and cash
equivalents as of July 31, 2010 and $1.3 billion of availability
under its various revolvers. Although the cash balance decreased
from the end of the first quarter of fiscal 2010 as the company
used it for seasonal working capital needs, Toys generated
positive free cash flow of $328 million in the LTM period.
Of concern is the strong competition in the toy retailing
business. Toys competes with a number of retailers, including
other toy retailers, discounters, and catalog and internet
businesses. During the holiday season, retailers dedicate more
shelf space to the toy category and offer competitive prices to
drive traffic into the stores. In addition, Toys' business is
highly seasonal with more than 40% of its net sales and almost all
of its earnings generated in the fourth quarter over the last
three fiscal years.
The ratings on the specific securities reflect Fitch's recovery
analysis based on the enterprise value of the company. The
enterprise value of $3.4 billion is based on a distressed EBITDA
of $680 million and a market multiple of 5x in a distressed
scenario. Applying this value (after subtracting the values
associated with the notes at the property companies as described
below) across the capital structure results in outstanding
recovery prospects (91%-100%) for the asset-based revolvers, which
are rated 'BB/RR1'. The revolvers are secured by inventory,
receivables and certain Canadian real estate in North America and
all assets in Europe. The secured term loan and senior secured
notes are secured by intellectual property and second liens on
accounts receivable and inventory of TOY-Delaware and the
guarantors. They have below-average recovery prospects (11%-30%)
and are rated 'B-/RR5'. The senior unsecured notes at TOY-
Delaware have poor recovery prospects (less than 10%) and are
rated 'CCC/RR6'. The senior unsecured notes at the holding
company level are structurally subordinated, and are rated
'CC/RR6', also reflecting poor recovery prospects (less than 10%)
in a distressed case.
The ratings on the notes at the property companies reflect a net
operating income approach to assigning a value to the underlying
assets whereby a capitalization rate is applied to the NOI of the
properties to determine a going-concern valuation. This approach
is consistent with how Fitch views recovery for other types of
property companies such as REITs. Based on this analysis, the
senior notes at Toys 'R' Us Property Company I have outstanding
recovery prospects (91%-100%) and are rated 'BB/RR1'. These notes
benefit from being the landlord of 359 locations leased by Toys
Delaware. The senior notes at Toys 'R' Us Property Company II
have superior recovery prospects (71%-90%) and are rated 'BB-
/RR2'. They benefit from being the landlord of 129 locations
leased by Toys Delaware.
Fitch maintains the Rating Watch Positive for these ratings:
Toys 'R' Us, Inc.
-- IDR 'B';
-- Senior unsecured notes 'CC/RR6'.
Toys 'R' Us - Delaware, Inc.
-- IDR 'B';
-- Secured revolver 'BB/RR1';
-- Secured term loan 'B-/RR5';
-- Senior secured notes 'B-/RR5';
-- Senior unsecured notes 'CCC/RR6'.
Toys 'R' Us Property Co. I, LLC (previously known as TRU 2005 RE
Holding Co. I, LLC)
-- IDR 'B';
-- Senior unsecured notes 'BB/RR1'.
Toys 'R' Us Property Co. II, LLC (previously known as Giraffe
Holdings, LLC)
-- IDR 'B';
-- Senior unsecured notes 'BB-/RR2'.
Toys 'R' Us Europe, LLC (previously known as Toys 'R' Us (UK)
Ltd.)
-- IDR 'B';
-- Secured revolver 'BB/RR1'.
TRADE SECRET: Awaiting Dismissal Ruling, Gets Add'l Exclusivity
---------------------------------------------------------------
Dow Jones' Small Cap reports that Trade Secret Inc. won a Feb. 1
extension of the exclusive period to propose a Chapter 11 plan and
a March 31 extension of the period to solicit votes for the plan.
According to the report, Trade Secret succeeded in securing extra
time to control its bankruptcy case while it waits for a verdict
on its request to dismiss the proceedings. While Trade Secret has
no intention of proposing a plan of liquidation in the case and is
seeking to have its proceedings dismissed, it maintains that the
extension is necessary to maintain order in the case.
"Termination of the debtors' exclusive periods would adversely
impact the interest of the debtors' estates," Trade Secret said in
its exclusivity request, filed earlier this month, Dow Jones says.
About Premier Salons
Premier Salons Beauty Inc., Trade Secret Inc., and six affiliates
filed for bankruptcy protection on July 6 (Bankr. D. Del. Lead
Case No. 10-12153). The Chapter 11 petitions of Premier Salons
and Trade Secret each estimated assets of up to $50,000 and debts
of up to $50 million.
Trade Secret and its affiliates currently own and operate
approximately 612 retail and salon locations in shopping malls and
strip centers throughout the United States and Puerto Rico, on a
collective basis. The Trade Secret Group consists of stores
operating primarily under four trade names: Trade Secret, Beauty
Express, BeautyFirst, and PureBeauty(R).
Joseph M. Barry, Esq., at Young, Conaway, Stargatt & Taylor,
represents the Debtors in their Chapter 11 effort. Epiq
Bankruptcy Solutions, LLC, is claims agent to the Debtors.
Non-debtor affiliates Premier Salons, Inc. and Premier Salons Ltd.
and its U.S. and Canadian corporate affiliates own and operate 340
hair and cosmetic service salons throughout North America, with
locations in specialty stores such as Saks, Sears, and Macy's.
TRANS-LUX CORPORATION: Posts $1.2 Million Net Loss in Q3 2010
-------------------------------------------------------------
Trans-Lux Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $1.23 million on $7.08 million of revenue
for the three months ended September 30, 2010, compared with a net
loss of $782,000 on $8.01 million of revenue for the same
period of 2009.
The Company incurred a net loss of $5.26 million for the nine
months ended September 30, 2010, and has a working capital
deficiency of $17.17 million as of September 30, 2010.
The Company did not make the December 1, 2009 required sinking
fund payment of $105,700 on its 9 1/2% Subordinated debentures due
2012 and the June 1, 2010 interest payment of $50,200. In
addition, the Company did not make the March 1, 2010 and
September 1, 2010 interest payments totaling $835,600 on its
8 1/4% Limited convertible senior subordinated notes due 2012.
The Company's balance sheet as of September 30, 2010, showed
$35.43 million in total assets, $33.30 million in total
liabilities, and stockholders' equity of $2.13 million.
As reported in the Troubled Company Reporter on April 24, 2010,
UHY LLP, in Hartford, Connecticut, expressed substantial
doubt about the Company's ability to continue as a going concern,
following the Company's 2009 results. The independent auditors
noted that the Company has incurred significant recurring losses
from continuing operations and has a significant working capital
deficiency. Further, the Company is in default of the indenture
agreements governing its outstanding 9 1/2% Subordinated
Debentures and its 8 1/4% Limited Convertible Senior Subordinated
Notes.
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?6fa2
About Trans-Lux Corporation
Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a
designer and manufacturer of digital signage display solutions for
the financial, sports and entertainment, gaming and leasing
markets.
TRIBUNE CO: Committee Wants to Recover $18MM From Advisors, Attys.
------------------------------------------------------------------
The Official Committee of Unsecured Creditors for Tribune Co.
seeks leave, standing and authority to toll or commence,
prosecute, settle, and recover certain causes of action on behalf
of the Debtors' estates arising under Sections 547 and 550 of the
Bankruptcy Code against certain of the Debtors' professionals who
received payments in the 90 days prior to the Petition Date.
The Preference Defendants are:
* Sidley Austin LLP
* McDermott Will & Emery
* PricewaterhouseCoopers
* Jenner & Block LLP
* Paul, Hastings, Janofsky & Walker LLP
* Seyfarth Shaw LLP
* King, Blackwell, Downs & Zehnder, P.A.
* Davis Wright & Tremaine
* Levine Sullivan Koch & Schulz, LLP
The Committee tells the Court that the Preference Defendants
received in excess of $18 million from the Debtors that may be
subject to avoidance and recovery as preferential payments.
According to the Committee, there are inherent conflicts that make
it very difficult, if not impossible, for the Debtors to preserve
or vigorously pursue actions against their current professional
advisors.
To ensure efficient and appropriate use of the estate resources,
if a Preference Action is not tolled with the Preference
Defendants for any reason, the Committee proposes that, after they
have been filed and served, the Preference Action will be stayed
pending a resolution of the proposed plans of reorganization. The
Committee maintains that this stay is important because certain
plans currently propose to release, limit recoveries, or otherwise
moot certain of the claims that would be brought against
identified Preference Defendants.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
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 Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to
the Official Committee of Unsecured Creditors. AlixPartners LLP
is the Committee's financial advisor. Landis Rath Moelis &
Company serves as the Committee's investment banker. Thomas G.
Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware,
represents the Committee in connection with the lawsuit filed
against former officers and shareholders for the 2007 LBO of
Tribune.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Plan Proponents Attack Each Other's Plans
-----------------------------------------------------
Tribune Company and its debtor affiliates, the Official Committee
of Unsecured Creditors, Angelo, Gordon & Co., L.P., Oaktree
Capital Management, L.P., and JPMorgan Chase Bank, N.A., object to
approval of the Disclosure Statements explaining the Plans of
Reorganization separately proposed by:
(a) Aurelius Capital Management, L.P., Deutsche Bank Trust
Company Americas, Law Debenture Trust Company of New York,
and Wilmington Trust Company or the "Pre-LBO Debtholder
Plan Proponents;"
(b) King Street Acquisition Company, LLC, King Street Capital,
L.P., and Marathon Asset Management, L.P. or the "Bridge
Plan Proponents;" and
(c) a group of holders of so-called Step One Senior Loan
Claims or the "Step One Plan Proponents."
The Debtors, et al., relate that the Pre-LBO Debtholder Plan
Proponents tout the Pre-LBO Debtholders Plan as one that will be
able to go effective expeditiously and with fewer conditions than
the other plans of reorganization that have been proposed in the
Debtors' Chapter 11 cases. The Debtors, et al., complain that the
Pre-LBO Debtholders Plan Disclosure Statement glosses over or
misstates a number of material facts and risks to creditors,
including:
* inability to describe creditor recoveries;
* risk associated with the Aurelius vote buying scheme;
* risk and potential value degradation due to reserves;
* Federal Communications Commission risks and issues;
* forced acceptance of the Pre-LBO Debtholders Plan by the
Debtors; and
* failure to classify securities litigation claims against
subsidiaries.
According to the Debtors, et al., the Pre-LBO Debtholders Plan
Responsive Statements are filled with over-the-top rhetoric,
allegations, and inflammatory innuendo.
The Debtors, et al., also complain that the Bridge Plan Disclosure
Statement is seriously misleading for:
-- failure to disclose recoveries and risks under Litigation
Plan scenario;
-- lack of disclosure regarding Bridge Plan Settlements; and
-- mischaracterization of the Settlement Plan.
The Bridge Plan Responsive Statement, the Debtors, et al., assert
fails to disclose or discuss the fact that the Bridge Plan is
highly likely to revert to something identical to the Pre-LBO
Debtholders Plan.
The Debtors, et al., further complain that the Step One Plan
Disclosure Statement is missing several critical categories of
information, without which it is impossible for creditors to
understand the proposed settlement offered by the Step One
Proponents or the consequences of confirmation of that Plan:
-- failure to disclose nature of or basis for sharing
provision reserve amount;
-- FCC risks and issues;
-- misstatements and omissions regarding settlement plan; and
-- misstatements regarding Debtor preparation of Step One
Plan materials.
The Step One Responsive Statement is also misleading and must be
corrected in several instances, the Debtors, et al., argue.
Step One Proponents
The Step One Proponents object to the Disclosure Statements
explaining the Plans of Reorganization proposed by each of (i) the
Debtors, et al., (ii) the Pre-LBO Debtholder Plan Proponents, and
(iii) the Bridge Plan Proponents.
The Step One Proponents maintain that given how profoundly the
Debtors' Plan varies from the conclusions expressed in the
Examiner's Report, their Disclosure Statement must provide the
rationale for those variations.
The Step One Proponents specifically complain that the Debtors'
Plan fails to explain why the nominal settlement amount it
proposed with respect to the LBO-Related Causes of Action against
the Step Two Loans is remotely sufficient, given the conclusions
in the Examiner's Report that it is "highly likely" that the Step
Two Loans are avoidable as constructive fraudulent transfers and
"somewhat likely" that they are avoidable as intentional
fraudulent transfers.
The Step One Proponents further complain that the Debtors'
Disclosure Statement fails to provide adequate information:
-- regarding the basis for the ratable sharing of distributions
and the ratable sharing of the settlement amount with
respect to the Step One Loans and the Step Two Loans in
light of the Examiner's findings that it is "highly
unlikely" that the Step One Loans are avoidable as
fraudulent transfers;
-- as to why Step One Loan Claims and the Step Two Loan Claims
should be classified in the same class, despite the
fundamental dissimilarities between the Step One Loan and
the Step Two Loan Claims;
-- regarding the third party releases in favor of the Step Two
Lenders and the Senior Loan Agent, including the
consideration being provided by the Step Two Lenders and the
Senior Loan Agent for those releases;
-- regarding the uses of the Senior Lender Holdback and the
payment of Senior Lender fees and expenses due under the
Senior Loan Agreement; and
-- regarding the nature and the amount of claims against the
Debtors held by Angelo, Gordon & Co., L.P., Oaktree Capital
Management, L.P., and JPMorgan Chase Bank, N.A. This
information is critical for creditors to understand
potential conflicts of interests in connection with
negotiation of the Debtors' Plan.
The Step One Proponents assert that without adequate disclosure
concerning the Examiner's conclusion or explanation of why the
Examiner is incorrect, it would be materially misleading for the
Pre-LBO Debtholder Plan Proponents to solicit creditors on the
current basis. The Step One Proponents relate that in the
Litigation Disclosure Statement, there is not a single mention of
the Examiner's conclusions regarding the probability of succeeding
on the avoidance of Step One Transactions. If the Pre-LBO
Debtholder Plan Proponents would like to continue to lure Senior
Noteholders with prospects of highly unlikely 100% recoveries, its
Disclosure Statement must disclose the Examiner's conclusions
regarding these "potential litigation outcomes," the Step One
Proponents aver.
The Step One Proponents also assert that the Bridge Lender
Disclosure Statement lacks adequate information explaining what
theory in the Examiner's Report supports a cash recovery of 7.7%
for the subordinated Bridge Lender Claims. The Bridge Lender
Disclosure Statement should also provide information explaining
the basis for paying Senior Noteholders 138% of the distributable
value of Tribune in cash, the Step One Proponents assert. Unless
the Bridge Lenders can provide adequate information supporting the
basis for each of the recoveries proposed in the Bridge Lender
Plan settlements, the Bridge Lender Disclosure Statement should
not be used to solicit unknowing creditors, the Step One
Proponents aver.
The Step One Plan Proponents are certain holders of Step One
Senior Loan Claims totaling approximately $812,000,000 in the
principal amount.
The Step One Credit Agreement Lenders are composed of:
-- Alden Global Distressed Opportunities Fund, L.P.;
-- Alden Global Distressed Opportunities Master Fund, L.P.;
-- Arrowgrass Distressed Opportunities Fund Limited;
-- Arrowgrass Master Fund Ltd.;
-- Bennett Offshore Restructuring Fund, Inc.;
-- Bennett Restructuring Fund, L.P.;
-- BRF Senior Income, L.P.;
-- CFIP Master Fund, Ltd.;
-- DeBello Investors LLC;
-- Greywolf Capital Overseas Master Fund;
-- Greywolf Capital Partners II LP;
-- Greywolf CLO I, Ltd.;
-- Scoggin Worldwide Fund Ltd; and
-- Wexford Spectrum Investors LLC.
Pre-LBO Debtholders
Aurelius Capital Management, LP, Deutsche Bank Trust Company
Americas, Law Debenture Trust Company of New York and Wilmington
Trust Company, or the "Pre-LBO Debtholder Plan Proponents," object
to approval of the Disclosure Statements accompanying the Plans of
Reorganization separately proposed by the Debtors, et al., the
Step One Plan Proponents, and the Bridge Plan Proponents.
The Pre-LBO Debtholder Plan Proponents complain that the Debtors'
Plan conceals information necessary to evaluate fully their
proposed Plan. Specifically, the Pre-LBO Debtholder Plan
Proponents complain that the Debtors' Disclosure Statement:
-- fails to disclose necessary information regarding the
settlement of LBO-related causes of action;
-- fails to explain why senior lenders are entitled to recover
from the proceeds of LBO-Related Causes of Action;
-- fails to disclose the basis for the allocation of value
among the Tribune Entities and the Terms of the
Intercompany Claims Settlement;
-- mischaracterizes the Examiner's Report;
-- omits critical risk factor;
-- omits the Debtors Plan Proponents' Claims Holdings;
-- misrepresents breadth of creditor support;
-- fails to disclose the effect of the Proposed Bar Order;
-- contains inadequate disclosure with respect to the
unilateral resolution of the PHONES Notes dispute;
-- contains inadequate disclosure regarding the treatment of
Creditors' Claims;
-- lacks adequate disclosure with respect to the Trust
"Preferences;" and
-- contains inadequate disclosure on releases and exculpation.
The Pre-LBO Debtholder Plan Proponents also complains that the
Step One Lender Disclosure Statement suffers from many of the same
disclosure-related infirmities as the Debtors' Disclosure
Statement, in large because the Step One Lender Plan is a carbon
copy of that the of Debtors' Plan in most respects. The Pre-LBO
Debtholders Plan Proponents note that the Step One Disclosure
Statement also suffers from these defects:
-- fails to provide adequate disclosure of the parties being
released under the Step One Lender Plan; and
-- the Step One Lender Disclosure Statement should disclose
each specific Step Two LBO-Related Cause of Action that
would be transferred to the Litigation Trust.
According to the Pre-LBO Debtholders Plan Proponents, the primary
fault with the Bridge Lender Disclosure Statement is that it
inadequately discloses the treatment and expected recoveries for
Classes of Claims under the Bridge Lender Plan if one or more of
the three plan settlements contemplated by the Bridge Lender Plan
is not approved by the U.S. Bankruptcy Court for the District of
Delaware. In addition, the Pre-LBO Debtholders Plan Proponents
relate, the Bridge Lender Disclosure Statement also must provide
additional disclosure regarding releases, Creditors' Trust
Interests, Disgorgement, Subordination, Trusts Structure and
Governance, Claims Purchaser, Intercompany Claims, Allocation of
Value.
The Pre-LBO Debtholders Plan Proponents also object to the
responsive statements filed by the Plan Proponents contending that
the statements are inaccurate and misleading. The Responsive
Statements, according to the Pre-LBO Debtholders Plan Proponents:
-- use of misleading and self-serving terms to define the
Competing Plans;
-- overstates the amount of settlement consideration provided
to Senior Noteholders;
-- the Recovery Table contains a number of inaccuracies;
-- lacks adequate disclosure with respect to the first
$90 million of Trust Proceeds "Relinquished" by the Senior
Lenders;
-- lacks adequate disclosure regarding the application of the
Creditor Subordination provisions to other Parent Claims;
-- misleads creditors on future ownership of Reorganized
Tribune;
-- lacks adequate disclosure with respect to the Debtors'
Co-Proponents; and
-- mischaracterizes numerous features of the Pre-LBO
Noteholder Plan.
November 29 Disclosure Statement Hearing
The Court will convene a hearing to consider the adequacy of the
Disclosure Statement on November 29, 2010, at 10:00 a.m.
Objections are due November 19.
The proponents of the four competing plans of reorganization for
Tribune Company and its debtor affiliates separately filed with
the U.S. Bankruptcy Court for the District of Delaware their
responsive statements that they propose to include in the Master
Disclosure Document. The Master Disclosure Document will contain
a general disclosure statement, specific disclosure documents
filed by each of the Plan Proponents and the Plan Proponents'
responsive statements.
At the Court's directives, these groups filed statements urging
applicable classes of creditors to vote for their reorganization
plans:
* Tribune Company and its debtor affiliates, the Official
Committee of Unsecured Creditors, Oaktree Capital Management,
L.P., Angelo, Gordon & Co. L.P., and JPMorgan Chase Bank;
* Aurelius Capital Management, LP, on behalf of its managed
entities; Deutsche Bank Trust Company Americas, in its
capacity as successor indenture trustee for certain series
of senior notes; Law Debenture Trust Company of New York, in
its capacity as successor indenture trustee for certain
series of senior notes; and Wilmington Trust Company, in its
capacity as successor indenture trustee for the PHONES
notes;
* certain holders of Step One Senior Loan Claims; and
* King Street Acquisition Company, LLC, King Street Capital,
L.P. and Marathon Asset Management, L.P., on behalf of
certain funds and managed accounts, in their capacity as
Bridge Loan Lenders.
A. Debtors, et al.
The Debtors urge all Holders of Claims to vote in favor of the
Settlement Plan. The Debtors assert that the Settlement Plan
provides for substantial initial distributions to creditors and a
significant reduction in post-emergence litigation through fair
and reasonable settlements that are in the best interests of the
Estates and the parties-in-interest in the Chapter 11 cases. A
full-text copy of the Debtors' Statement is available for free
at http://bankrupt.com/misc/Tribune_DebtorsStmt.pdf
The Committee asks unsecured creditors to vote for the Settlement
Plan because it provides them with substantially greater initial
recoveries and more certainty than the Competing Plans. A full-
text copy of the Committee's Statement is available for free
at http://bankrupt.com/misc/Tribune_CommitteeStmt.pdf
Angelo, Gordon & Co., L.P. Oaktree Capital Management, L.P. and
JPMorgan Chase Bank, N.A. maintain that the Settlement Plan
provides Senior Lenders and other creditors with substantial
immediate distributions upon plan effectiveness. To ensure a
clear path to immediate recovery, the Senior Lenders must support
the Settlement Plan and, just as importantly, vote against the
Competing Plans, Angelo, Gordon, et al., avers. A full-text copy
of their statement is available for free at:
http://bankrupt.com/misc/Tribune_AngeloStmt.pdf
B. Step One Plan Proponents
The Step One Plan Proponents ask the Step One Lenders not to be
fooled by Oaktree, et al.'s attempt to settle "highly likely"
fraud claims against the Step Two Lenders for pennies on the
dollar. The Step Two Lenders are the lenders in Step Two
Transactions. Step Two Transactions refer to (a) the Merger,
(b) the execution, delivery, and performance of the Bridge Credit
Agreement, (c) the making of advances under an Incremental Credit
Agreement Facility, (d) all other transactions necessary to effect
or incidental to the transactions, and (e) the payment of fees,
costs and expenses related to the transactions.
According to the Step One Plan Proponents, the Step Two Lenders
should be knocked out entirely, not merely inconvenienced with a
nominal settlement payment, and no distributions payable to Step
One Lenders should be surcharged under the inapplicable Sharing
Provisions for the benefit of the Step Two Lenders.
The Step One Plan Proponents likewise urge the Step One Lenders
not to be fooled by Aurelius Plan's and Bridge Plan's fantastic
promises of huge recoveries from the Step One Lenders.
The Step One Plan Proponents assert that their Plan promises no
more and no less than what the Examiner's Report concluded was
appropriate in the Debtors' case -- a fair distribution on the
Effective Date to the Step One Lenders and to all legitimate
creditors and a fair chance to recover a second distribution upon
the successful challenge to the fraudulent Step Two Transactions.
A full-text copy of the Step One Plan Proponents' Statement is
available for free at:
http://bankrupt.com/misc/Tribune_StepOneStmt.pdf
C. Pre-LBO Debtholder Plan Proponents
Aurelius Capital, et al., filed an appeal to Tribune's non-LBO
creditors to "do the right thing and not let the LBO Lenders hold
Tribune hostage in bankruptcy to extort an unfair settlement."
Aurelius Capital, et al., relates that their plan is fairer
because it would maintain a level playing field with regard to the
LBO-related litigation.
"We are confident that on a level playing field, with a litigation
trust run by a real fiduciary rather than a shill, the LBO Lenders
will end up paying far more than they now propose and will thereby
be held accountable rather than be emboldened to imperil other
companies," Aurelius Capital, et al., maintains.
A full-text copy of Aurelius, et al.'s Statement is available for
free at http://bankrupt.com/misc/Tribune_AureliusStmt.pdf
D. Bridge Plan Proponents
The Bridge Plan Proponents urge creditors to vote to accept the
Bridge Plan and to reject the other Competing Plans. The Bridge
Plan Proponents are confident that their Plan is most likely to be
confirmed because, unlike the other Competing Plans, it is the
reorganization plan that provides a reasonable and balanced path
towards the Debtors' emergence from their protracted and expensive
Chapter 11 cases by embodying a good faith restructuring and
settlement proposal that is fair to all constituencies.
A full-text copy of the Bridge Plan Proponents' Statement is
available for free at:
http://bankrupt.com/misc/Tribune_BridgeStmt.pdf
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
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 Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to
the Official Committee of Unsecured Creditors. AlixPartners LLP
is the Committee's financial advisor. Landis Rath Moelis &
Company serves as the Committee's investment banker. Thomas G.
Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware,
represents the Committee in connection with the lawsuit filed
against former officers and shareholders for the 2007 LBO of
Tribune.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: JPM, et al., Want Contempt Order vs. Step One Lenders
-----------------------------------------------------------------
JPMorgan Chase Bank, N.A., Merrill Lynch Capital Corporation,
Citicorp North America, Inc., and Bank of America, N.A., ask the
U.S. Bankruptcy Court for the District of Delaware to find the
a group of lenders known as the Step One Credit Agreement Lenders
in contempt of the Court's order appointing mediator and the
automatic stay provisions of Section 362 of the Bankruptcy Code.
JPMorgan contends that the filing by the SOCALs of a complaint in
the Supreme Court of the State of New York is a clear violation of
the Mediation Order and the automatic stay.
The SOCALs filed a complaint in the Supreme Court against
JPMorgan, et al., asserting claims and seeking relief with respect
to issues arising out of the LBO-Related Causes of Action that are
before the Court on October 29, 2010.
The Debtors join in the Motion for Contempt. The Debtors agree
with the Arrangers that the commencement and prosecution of the
New York Action violate the express terms of the Mediation Order,
and that the New York Action should therefore be stayed in
accordance with that Order, at least during the pendency of the
Mediation, which is still ongoing.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
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 Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to
the Official Committee of Unsecured Creditors. AlixPartners LLP
is the Committee's financial advisor. Landis Rath Moelis &
Company serves as the Committee's investment banker. Thomas G.
Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware,
represents the Committee in connection with the lawsuit filed
against former officers and shareholders for the 2007 LBO of
Tribune.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Step One Lenders Want JPM Forced to Record Loan Trades
------------------------------------------------------------------
Certain Step One Credit Agreement Lenders ask the U.S. Bankruptcy
Court for the District of Delaware to either:
(i) acknowledge that the Step One plaintiffs are entitled to
seek injunctive relief in an action pending in the New
York State Court compelling JPMorgan Chase Bank N.A., as
administrative agent under the Senior Loan Agreement, to
record all pending and prospective loan trades; or
(ii) in the alternative, enter an order compelling JPMorgan to
record all pending and prospective loan trades.
Either way, the Step One Lenders further request that the
Bankruptcy Court not schedule a record date for plan voting
purposes until JPMorgan has recorded all relevant loan trades.
A number of Step One Lenders commenced a lawsuit in New York State
Court against JPMorgan, among others. The New York Action alleges
breach of contract claims under the Senior Loan Agreement --
certain Credit Agreement, dated as of May 17, 2007, among Tribune
Company; the lenders thereto; JPMorgan, as administrative agent;
Merrill Lynch Capital Corporation, as syndication agent; and
Citicorp North America, Inc. and Bank of America, N.A., as co-
documentation agents -- against JPMorgan, both as agent and as an
initial Lender in connection with the Step Two Transactions.
JPMorgan has responded in two ways:
(1) by seeking sanctions in the Bankruptcy Court for the
commencement by the Step One Plaintiffs of the New York
Action; and
(2) by informing a number of the Step One Plaintiffs
that it either has rejected their existing trades or
will not record any future trades for any Step One
Plaintiff.
Daniel B. Butz, Esq., at Morris, Nichols, Arsht, & Tunnell LLP, in
Wilmington, Delaware, avers that JPMorgan's wrongful refusal to
record trades threatens harm to the Step One Lenders by reducing
the amount of the claims that the relevant Step One Lenders can
vote with respect to the four competing plans of reorganization.
Given the timing of votes on the plans, including the Debtors'
proposed setting of a November 9 record date for voting purposes
with respect to all four proposed plans, it is critical that this
matter be resolved on an emergency basis by the Supreme Court for
the State of New York, or, if the Bankruptcy Court holds that it
has jurisdiction to do so, by the Bankruptcy Court, Mr. Butz
avers.
In separate filings, Lucy K. Galbraith, vice president at Bennett
Management Corporation, an investment management company and
Jack Doyle, a partner at Wexford Capital LP, an investment
advisor, filed with the Court declarations in support of the Step
One Motion.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
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 Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to
the Official Committee of Unsecured Creditors. AlixPartners LLP
is the Committee's financial advisor. Landis Rath Moelis &
Company serves as the Committee's investment banker. Thomas G.
Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware,
represents the Committee in connection with the lawsuit filed
against former officers and shareholders for the 2007 LBO of
Tribune.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIDIMENSION ENERGY: Authorized for $32 Million Asset Sale
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that TriDimension Energy LP was authorized by the
bankruptcy judge on Nov. 19 to sell the assets for $32.125
million. The price rose more than $4 million at auction.
TriDimension owes prepetition $37.5 million to secured lenders led
by Amegy Bank NA, as agent. The lenders are owed an additional
$5.6 million on terminated hedges. TriDimension also owes $6
million to general unsecured creditors, not including the
deficiency claim of the secured lenders, Chief Financial Officer
Kenneth A. Gregg.
About TriDimension Energy
TriDimension Energy, L.P., and its operating subsidiaries, TDE
Property Holdings, LP, Axis E&P, LP, Axis Onshore, LP, Axis
Marketing, LP, and Ram Drilling, LP, are engaged in the
acquisition, development, exploration, production, and sale of oil
and natural gas in Louisiana and Mississippi. The Company leases
approximately 165,218 gross acres of oil and gas property, and
have proven reserves of approximately 5.1 million barrels of oil
based on fourth quarter 2009 data. Tridimension Energy disclosed
$37,211,921 in assets and $45,389,239 in liabilities.
TriDimension Energy, L.P. and seven of its affiliated companies
filed for Chapter 11 on May 21, 2010 (Bankr. N.D. Tex. Case No.
10-33565). The Company has retained Vinson & Elkins LLP as their
lead bankruptcy counsel, Ottinger Hebert, L.L.C. as their special
counsel, FTI Consulting, Inc. as their financial advisors, and
Stephens Inc. as their investment bankers.
TYRONE HOSPITAL: Gary Fickes' Claim Has Been Discharged
-------------------------------------------------------
District Judge Kim R. Gibson rules that Gary L. Fickes' disputed
unsecured claim against Tyrone Hospital was untimely and has been
discharged.
The case is GARY L. FICKES, Plaintiff, v. TYRONE HOSPITAL,
Defendant, case no. 2004-cv-85 (W.D. Pa.). A copy of the Court's
Memorandum Opinion and Order of Court, dated October 29, 2010, is
available at http://is.gd/hK2xKfrom Leagle.com.
Tyrone Hospital filed for Chapter 11 bankruptcy protection (Bankr.
W.D. Pa. Case No. 06-70759) on Sept. 29, 2006. James R. Walsh,
Esq., at Spence, Custer, Saylor, Wolfe & Rose, L.L.C. --
jgula@spencecuster.com -- served as counsel. It estimated less
than $10,000 in assets and between $500,001 and $1 million in
debts. A copy of the Debtor's bankruptcy petition is available
at http://bankrupt.com/misc/pawb06-70759.pdf
By order dated June 10, 2010, the Hon. Jeffery A. Deller signed an
Order of Court whereby the Plan of Reorganization, as modified,
was approved.
UNIFRAX I: Moody's Raises Corporate Family Rating to 'B2'
---------------------------------------------------------
Moody's Investors Service raised Unifrax I LLC's Corporate Family
Rating to B2 from B3, as well as the ratings on the $180 million
Senior Secured Term Loan B due 2013 and $50 million Senior Secured
Revolver due 2012 to Ba3 from B1. The upgrade reflects Unifrax's
lower leverage position, strong liquidity, and improved market
conditions. The outlook is stable.
This summarizes the ratings changes:
Ratings upgraded:
Unifrax I LLC
* Corporate Family Rating -- B2 from B3
* Probability of default rating -- B2 from B3
* $180 million Senior Secured Term Loan B due 2013, Ba3 (LGD2,
27%) from B1 (LGD2, 27%)
* $50 million Senior Secured Revolver due 2012, Ba3 (LGD2, 27%)
from B1 (LGD2, 27%)
* Outlook: Stable
Ratings Rationale
The ratings upgrade reflects the improvement in Unifrax's credit
metrics, good liquidity and expectations for further growth in
sales and profitability. Sales have shown steady growth in 2010
compared to prior year periods. Acquisitions and exposure to
faster growing emerging markets have helped revenue, even as sales
volumes to the automobile industry and certain industrial
applications in the US and Europe remain below peak levels and
pricing remains stable. Profits have benefited from restructuring
activity, operating leverage realized with higher production
volumes and contributions from acquisitions. The company most
recently bought Brightcross, a ceramic fiber products manufacturer
in the UK, and is expected to continue look for opportunities to
grow through acquisitions as it seeks to increase exposure in new
and faster growing markets.
Unifrax's liquidity benefits from its large cash balances, its
undrawn revolver and expectations for positive free cash flow in
2011. It is expected to continue to make modest bolt-on
acquisitions without compromising its liquidity. The company
benefits from not having any near-term maturities and is expected
to remain in compliance with its financial covenants.
The stable outlook reflects the improved operating environment,
Moody's expectations for continued growth in Unifrax's markets and
good liquidity. Unifrax's modest size, significant debt (Debt to
Sales of >1x), limited operational diversity, variability of
profitability during economic downturns, limited financial
disclosure and unique risks temper its CFR despite the strong
financial metrics. The company's ratings could be upgraded should
its end markets and sales volumes continue to grow, Debt / EBITDA
remains below 3.8x and Free Cash Flow / Debt remains above 8% on a
sustained basis.
Unifrax I LLC, based in Niagara Falls, New York, is a leading
producer of heat resistant ceramic fiber products, primarily for
automotive, fire protection, and industrial furnace-related
applications. Revenues were $287 million for the twelve months
ended September 30, 2010.
UNIVERSAL BIOENERGY: Delays Filing of Form 10-Q for Sept. 30 Qtr.
-----------------------------------------------------------------
Universal Bioenergy Inc. said it could not timely file its Form
10-Q for the quarter ended Sept. 30, 2010, because of delays in
completing the preparation of its financial statements and its
management discussion and analysis.
Universal Bioenergy reported a net loss of $439,402 on $14.0
million of revenue for the three months ended June 30, 2010,
compared to a net loss of $474,486 on zero revenue for the same
period of 2009.
The Company's balance sheet at June 30, 2010, showed $2.9 million
in total assets, $3.7 million in total liabilities, and a
stockholders' deficit of $768,333.
S.E.Clark & Company, P.C., in Tucson, Arizona, expressed
substantial doubt about the Company's ability to continue as a
going concern, following its 2009 results. The independent
auditors noted that the Company has net losses for the period from
inception (August 13, 2004) to December 31, 2009, of
$14.8 million. Further, the Company has inadequate working
capital to maintain or develop its operations, and is dependent
upon funds from private investors and the support of certain
stockholders.
Universal Bioenergy Inc., is an alternative energy company
headquartered in Irvine, California. The Company's new strategic
direction is to develop and market a diverse product line of
alternative and natural energy products including, natural gas,
solar, biofuels, wind, wave, tidal, and green technology products.
US AIRWAYS: ALPA-Represented Express Pilots Form Alliance
---------------------------------------------------------
US Airways Express pilots represented by the Air Line Pilots
Association, Int'l (ALPA) this week formalized an alliance that
promotes and maintains the highest level of safety in the US
Airways Express brand, improves pilot contract standards, and
protects pilot jobs at "express-level" airlines. The US Airways
Express Pilots Alliance ("Alliance") includes ALPA pilots from Air
Wisconsin, Colgan, Mesa Air Group, Piedmont Airlines, PSA
Airlines, and Trans States Airlines.
"ALPA pilots are not competitors, and we will not be whipsawed
against one another by undercutting our peers," said ALPA
President Capt. John Prater. "By working across company lines,
the US Airways Express pilots have demonstrated the courage and
leadership necessary to maintain and enhance the safety, work
rules and jobs within the US Airways family. Their work will also
go beyond that brand and have a tremendous impact on our
profession, our industry, and the customers that we serve."
Pilot leaders of the Alliance have been coordinating over the past
several months to standardize the express carriers' goals for the
US Airways system. Specifically, they are working to coordinate
operational programs amongst the ALPA express carriers in order to
provide the highest level of safety, training and professionalism.
The Alliance also implemented a means to improve contract
standards. All six members of the Alliance are in contract
negotiations currently with their respective companies. Through
the Alliance, the pilot groups established a process to support
each of their respective negotiating committees; this approach
fosters information sharing and ensures implementation of group
goals in their individual contract negotiations.
Protecting and enhancing pilots' job security is another focus of
the Alliance, and members took a significant step toward achieving
that goal. It is not uncommon for express flying to be shifted
from one carrier to another, and while one pilot group may benefit
from this shift, the other may suffer. As such, members of the
Alliance each committed to reviewing shifts in flying to determine
the effects it may have on the pilot groups, and if necessary,
meet with management promptly in an effort to negotiate provisions
for the affected pilots that address jobs, longevity, and other
career protections.
ALPA represents 53,000 pilots at 38 airlines in the U.S. and
Canada, including the approximately 3,000 pilots flying as US
Airways Express for Air Wisconsin, Colgan, Mesa Air Group,
Piedmont Airlines, PSA Airlines, and Trans States Airlines. For
more information, visit http://www.alpa.org
About US Airways
US Airways -- http://www.usairways.com/-- along with US Airways
Shuttle and US Airways Express, operates more than 3,000 flights
per day and serves more than 190 communities in the U.S., Canada,
Mexico, Europe, the Middle East, the Caribbean, Central and South
America.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another Chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represented the
Debtors in their restructuring efforts. The USAir II bankruptcy
plan became effective on September 27, 2005. The Debtors
completed their merger with America West on the same date. (US
Airways Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
* * *
US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp.
family rating and probability of default rating. Outlook is
negative.
US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer
Credit rating and LT Local Issuer credit rating. Outlook is also
negative.
US Airways Group carries Fitch's "CCC" LT Issuer default rating
and "C" Senior unsecured debt rating. Outlook is also negative.
US AIRWAYS: Pilots Protest Slow Contract Negotiations
-----------------------------------------------------
The US Airline Pilots Association (USAPA), representing the pilots
of US Airways, picketed at the Ronald Reagan Washington National
Airport to bring attention to what it believes to be US Airways'
efforts to take advantage of its pilots, already the
lowest-compensated pilot group among the major airlines.
The picketing event is a continuation of the pilots' public
display of frustration with what USAPA believes to be US Airways
management's deliberate efforts to slow the pace of contract
negotiations since 2005.
In October, US Airways reported a third quarter net profit of
$240 million, the highest third quarter net profit in its history.
The company has also reported record traffic and leading metrics
in on-time performance and customer satisfaction during the last
few months.
"Our pilots have made significant sacrifices in our salaries,
pensions and benefits to help US Airways during its times of
need," said Captain Mike Cleary, president of USAPA. "Those
concessions have left our pilots the lowest paid in our industry.
Our reward for investing in this airline and posting leading
performance numbers is to remain the lowest-compensated pilots
among our peers. By dragging negotiations out for more than five
years, US Airways is effectively extending those concessions
indefinitely. Considering that US Airways is reporting record
profits and 60% increases in management costs since 2006, it is no
surprise that our pilots are angry."
"We firmly believe that US Airways management is taking advantage
of us by abusing the latitude afforded them in the Railway Labor
Act (RLA)," added Mr. Cleary. "However, under specific
circumstances, the RLA also permits job actions."
"It is important that the public realize that we have always tried
to work with US Airways management to seek joint solutions, and we
are committed to doing so in our contract negotiations," Mr.
Cleary continued. "However, after five years of Management's
stalling tactics, we have to consider what is best for our
membership. Our negotiating positions are reasonable, and we
think that our passengers understand our unwillingness to being
taken advantage of. Everyone has their breaking point, and we are
prepared to strike as soon as we are legally permitted to do so by
the Railway Labor Act."
The picketing event was held on the north end of the upper
ticketing level at Washington National Airport.
About USAPA
Headquartered in Charlotte, N.C., the US Airline Pilots
Association (USAPA) represents the more than 5,000 mainline
pilots who fly for US Airways. USAPA's mission is to ensure safe
flights for airline passengers by guaranteeing that their lives
are in the hands of only the most qualified, competent and well-
equipped pilots. USAPA will fight against any practices that may
jeopardize its pilots' training, equipment, workplace
environment, compensation or work/life balance, or that
compromise its pilots' ability to execute the optimal flight.
Visit the USAPA website at www.USAirlinePilots.org.
About US Airways
US Airways -- http://www.usairways.com/-- along with US Airways
Shuttle and US Airways Express, operates more than 3,000 flights
per day and serves more than 190 communities in the U.S., Canada,
Mexico, Europe, the Middle East, the Caribbean, Central and South
America.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another Chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represented the
Debtors in their restructuring efforts. The USAir II bankruptcy
plan became effective on September 27, 2005. The Debtors
completed their merger with America West on the same date. (US
Airways Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
* * *
US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp.
family rating and probability of default rating. Outlook is
negative.
US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer
Credit rating and LT Local Issuer credit rating. Outlook is also
negative.
US Airways Group carries Fitch's "CCC" LT Issuer default rating
and "C" Senior unsecured debt rating. Outlook is also negative.
US AIRWAYS: To Add 500 Crew Members in 2011
-------------------------------------------
US Airways announced that it will need 500 crew members next year
primarily in anticipation of planned retirements and attrition,
which will be filled by recalling employees currently on furlough,
as well as through hiring new crew members. The majority of these
returning and new pilots and flight attendants will be flying by
July.
"This is great news for our workforce and the communities we
serve," said US Airways President, Scott Kirby. "We look forward
to welcoming our colleagues back to US Airways, and bringing new
crew members onto the team."
"Our crew member hiring needs are being driven primarily by
planned retirements and attrition, as well as international
growth. Today's announcement is consistent with our previously
announced plan to keep our domestic capacity flat in 2011 while
growing international capacity by 8 percent."
The 2011 crew member plan includes filling 420 flight attendant
positions and 80 pilot positions. The Company will first offer
these positions to employees currently on furlough status, and
once this process is complete will begin hiring new employees.
After the recall, US Airways will have no flight attendants on
furlough, and may have up to 100 pilots remaining on furlough.
When the recall and new hire process is complete, the airline will
have approximately 4,970 active pilots and 7,300 active flight
attendants.
About US Airways
US Airways -- http://www.usairways.com/-- along with US Airways
Shuttle and US Airways Express, operates more than 3,000 flights
per day and serves more than 190 communities in the U.S., Canada,
Mexico, Europe, the Middle East, the Caribbean, Central and South
America.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another Chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represented the
Debtors in their restructuring efforts. The USAir II bankruptcy
plan became effective on September 27, 2005. The Debtors
completed their merger with America West on the same date. (US
Airways Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
* * *
US Airways Group carries Moody's "Caa1" Long-Term rating, LT Corp.
family rating and probability of default rating. Outlook is
negative.
US Airways Group carries Standard & Poor's "B-" LT Foreign Issuer
Credit rating and LT Local Issuer credit rating. Outlook is also
negative.
US Airways Group carries Fitch's "CCC" LT Issuer default rating
and "C" Senior unsecured debt rating. Outlook is also negative.
USG CORP: Board Approves CEO's Annual Base Salary Increase
----------------------------------------------------------
In connection with the election of James S. Metcalf as President
and Chief Executive Officer of the USG Corporation, effective
January 1, 2011, on November 12, 2010, the Company's Board of
Directors approved the increase of Mr. Metcalf's annual base
salary to $825,000, also effective January 1, 2011.
About USG Corp.
USG Corporation, headquartered in Chicago, Illinois, is a leading
producer and distributor of building materials in the Unites
States, Canada and Mexico. The company manufactures and markets
gypsum wallboard and operates a specialty distribution business
that sells to professional contractors. It also manufactures
ceiling tiles and ceiling grids used primarily in commercial
applications. Revenues for the last 12 months through March 31,
2010, totaled approximately $3.1 billion.
* * *
As reported by the Troubled Company Reporter on November 8, 2010,
Moody's Investors Service assigned a B2 rating to USG
Corporation's new senior unsecured notes, and affirmed its Caa1
Corporate Family Rating and Caa1 Probability of Default Rating.
USG's speculative grade liquidity rating remains SGL-3. The
outlook is stable.
The Caa1 Corporate Family Rating results from weak operating
performance. Low capacity utilization rates of approximately 45%
at its gypsum manufacturing facilities make it difficult for USG
to overcome its high fixed costs. Moody's projects that potential
demand increases for wallboard from North American new home
construction and repair and remodeling will not be adequate to
generate sufficient volumes and operating profits to cover USG's
interest expense over the intermediate term. Furthermore, the
non-residential construction end market, which accounts for about
30% of USG's revenues, is expected to face stagnant growth well
into 2011. The amount of profits derived from the company's
worldwide ceilings business is not enough to make up shortfalls in
the gypsum and distribution businesses. For the last twelve
months through September 30, 2010, operating margins remain
substandard at negative 4.9% and leverage is very high at debt-to-
EBITDA of 27.2 times. The company's inability to generate
positive earnings will result in very weak credit metrics for the
foreseeable future and will require cash to fund operating
shortfalls.
VAQUERIA EL VERDOR: Case Summary & 5 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Vaqueria El Verdor, Inc.
Carr. 119 Km 10.5 Bo Cienaga, Camuy PR
P.O. Box 1319 SABANA HOYOS
Arecibo, PR 00688
Tel: (787) 846-4658
Bankruptcy Case No.: 10-11011
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Winston Vidal-Gambaro, Esq.
WINSTON VIDAL LAW OFFICE
P.O. Box 193673
San Juan, PR 00919-3673
Tel: (787) 751-2864
Fax: (787) 763-6114
E-mail: wvidal@prtc.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's five largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/prb10-11011.pdf
The petition was signed by Jose Gabriel Cordero Jimenez,
president.
VERENIUM CORP: Posts $39.7-Mil. Net Income in Sept. 30 Quarter
--------------------------------------------------------------
Verenium Corporation reported net income of $39.71 million on
$12.57 million of revenue for the three months ended Sept. 30,
2010, compared with a net loss of $2.29 million on $11.92 million
of revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2010, showed
$113.12 million in total assets, $107.49 million in total
liabilities, and stockholders' equity of $5.63 million.
"I am pleased with the significant progress made across the
business over the last quarter; we continue to see solid progress
growing and diversifying our product sales and improved
performance at the gross margin level," said Carlos A. Riva,
President and Chief Executive Officer of Verenium. "Further, we
remain committed to using our financial resources to accelerate
the development of our current products and our pipeline."
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?6e35
A full-text copy of the earnings release is available for free
at http://ResearchArchives.com/t/s?6e36
About Verenium Corporation
Cambridge, Mass.-based Verenium Corporation (NASDAQ: VRNM) --
http://www.verenium.com/-- is a pioneer in the development and
commercialization of high-performance enzymes for use in
industrial processes. Verenium currently sells enzymes developed
using its R&D capabilities to industrial customers globally for
use in markets including biofuels, animal health and oil seed
processing
As reported in the Troubled Company Reporter on March 19, 2010,
Ernst & Young LLP, in San Diego, Calif., expressed substantial
doubt about the Company's ability to continue as a going concern.
The independent auditors noted that of the Company's recurring
operating losses and accumulated deficit of $630.0 million at
December 31, 2009.
VERTIS HOLDINGS: To Present Plan for Confirmation on Dec. 16
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Vertis Holdings Inc. scheduled a confirmation hearing
on Dec. 16 for approval of the prepackaged reorganization begun
Nov. 17. The bankruptcy judge in New York also gave interim
approval for most of a $200 million loan, according to the report.
Vertis filed together with its Chapter 11 petition a prepackaged
plan of reorganization, which will reduce its total debt by
approximately 60%, or $700 million, while substantially lowering
interest costs, extending maturities and increasing liquidity.
Vertis has secured a commitment for a $200 million debtor-in-
possession Revolving Credit Facility from GE Capital Corp.. The
DIP facility will provide Vertis the necessary financing to
complete the confirmation of its Plan of Reorganization within 45
to 60 days and ensure that it is able to uphold its commitments to
clients, employees, and suppliers.
Vertis also said it has already received commitments for $600
million in financing to be implemented under the Plan of
Reorganization, including a $425 million Term Loan from Morgan
Stanley Senior Funding, Inc. and a $175 million Revolving Credit
Facility from GE Capital. Vertis has also received commitments
for up to $100 million of new common equity, pursuant to its
previously announced Private Placement and the associated
backstops.
About Vertis Holdings
Vertis -- http://www.thefuturevertis.com/-- is a marketing
communications company that delivers advertising, direct marketing
and interactive solutions to prominent brands across North
America.
Baltimore, Maryland-based Vertis Holdings, Inc., filed for Chapter
11 bankruptcy protection on November 17, 2010 (Bankr. S.D.N.Y.
Case No. 10-16170). The Debtor estimated its assets and debts at
more than $1 billion. Affiliates also filed separate Chapter 11
petitions -- American Color Graphics, Inc. (Bankr. S.D.N.Y. Case
No. 10-16169), Vertis Holdings, Inc. (Bankr. S.D.N.Y. Case No. 10-
16170), Vertis, Inc. (Bankr. S.D.N.Y. Case No. 10-16171), ACG
Holdings, Inc. (Bankr. S.D.N.Y. Case No. 10-16172), Webcraft, LLC
(Bankr. S.D.N.Y. Case No. 10-16173), and Webcraft Chemicals, LLC
(Bankr. S.D.N.Y. Case No. 10-16174).
Mark A. McDermott, Esq., and Kenneth S. Ziman, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, serve as counsel to the Debtors.
Kurtzman Carson Consultants is the claims and notice agent.
Perella Weinberg Partners is the investment banker and financial
advisor. FTI Consulting Inc. is the restructuring and financial
advisor.
This is not the Debtors' first journey through chapter 11. On
July 15, 2008, Vertis and American Color Graphics, each commenced
prepackaged chapter 11 cases (Bankr. D. Del. Case No. 08-11460) to
complete a merger. In August 2008, Vertis emerged from
bankruptcy, completing a merger with ACG.
VERTIS HOLDINGS: Gets Temporary Approval to Incur DIP Financing
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized, on an interim basis, Vertis Holdings, Inc., et al.,
to:
-- obtain senior secured postpetition financing of up to an
aggregate principal or face amount not to exceed
$185 million, from a syndicate of lenders, as Tranche A
Lenders, led by General Electric Capital Corporation, as
administrative agent and collateral agent; and
-- use cash collateral that constitutes revolving priority
collateral of ABL lenders, prepetition term loan lenders and
prepetition second lien noteholders.
A final hearing on the Debtors' request to incur debt will be held
December 16, 2010.
As reported in the Troubled Company Reporter on November 22, the
DIP lenders have committed to provide up to $200 million on a
final basis. A copy of the DIP financing agreement is available
for free at:
http://bankrupt.com/misc/VERTIS_HOLDINGS_creditpact.pdf
The Debtors will use a portion of the proceeds from the DIP
Credit Facility upon entry of the DIP interim court order (a) to
pay in full, in cash, as a condition to closing the DIP Credit
Facility, the outstanding balance of the revolving credit
advances; (b) to pay and reimburse the Prepetition ABL Agent for
all unpaid fees, costs and expenses incurred by the Prepetition
ABL Agent under the Prepetition ABL Credit Documents, whether
incurred prior or subsequent to the Petition Date, at the time and
in the manner due under the Prepetition ABL Credit Documents, and
to pay the Prepetition ABL Agent for such indemnification rights
or claims that it has or may have under the Prepetition ABL Credit
Documents, whether incurred prior or subsequent to the Petition
Date, at the time and in the manner due under the Prepetition ABL
Credit Documents; and (c) other uses.
In the event of default, the Debtors will pay an additional 2%
default interest per annum.
The DIP facility will mature six months after the closing date of
the DIP Credit Agreement.
The DIP lien is subject to a certain carve-out expenses.
A copy of the budget is available for free at:
http://bankrupt.com/misc/VERTIS_HOLDINGS_budget.pdf
As adequate protection for any diminution in value of the lenders'
collateral, the Debtors will grant the DIP Agent, for the benefit
of itself and the DIP Lenders, replacement liens on the personal
and real property and assets of the Debtors and each guarantor.
The DIP Liens will have first-priority security interests in and
liens upon all DIP Collateral that is not otherwise subject to any
valid, perfected, enforceable and non-avoidable lien in existence
as of the Petition Date. The DIP Agent and the DIP Lenders will
have claims for the repayment of all obligations under the DIP
Credit Facility and the claims will be entitled to administrative
superpriority status.
The Prepetition ABL Agent and Prepetition ABL Lenders will
receive as adequate protection: (i) the repayment of the
Prepetition ABL Credit Agreement Obligations outstanding on the
Petition Date; (ii) a replacement lien on the DIP Collateral,
equal in priority to the DIP Liens, to secure claims for any
diminution in the value of their interests in the Prepetition
Collateral; and (iii) superpriority administrative expense claims.
Additionally, the Prepetition ABL Agent will receive ongoing
payment of the Prepetition ABL Expenses.
The Prepetition Term Loan Agent and Prepetition Term Loan Lenders
will receive as adequate protection (i) payment of an amount equal
to accrued and unpaid interest at the non-default rate as and when
due under the Prepetition Term Loan Credit Agreement; (ii) payment
or reimbursement of reasonable fees and expenses of counsel to the
Prepetition Term Loan Agent, and (iii) to the extent of any
diminution in value of the collateral securing the Prepetition
Term Loans (a) Section 507(b) Claims and (b) replacement liens, in
each case.
The Prepetition Second Lien Noteholders will receive as adequate
protection, to the extent of any diminution in value of the
collateral securing the claims of the Second Lien Noteholders:
(a) Section 507(b) and (b) replacement liens.
About Vertis Holdings, Inc.
About Vertis Holdings
Vertis -- http://www.thefuturevertis.com/-- is a marketing
communications company that delivers advertising, direct marketing
and interactive solutions to prominent brands across North
America.
Baltimore, Maryland-based Vertis Holdings, Inc., filed for Chapter
11 bankruptcy protection on November 17, 2010 (Bankr. S.D.N.Y.
Case No. 10-16170). The Debtor estimated its assets and debts at
more than $1 billion. Affiliates also filed separate Chapter 11
petitions -- American Color Graphics, Inc. (Bankr. S.D.N.Y. Case
No. 10-16169), Vertis Holdings, Inc. (Bankr. S.D.N.Y. Case No. 10-
16170), Vertis, Inc. (Bankr. S.D.N.Y. Case No. 10-16171), ACG
Holdings, Inc. (Bankr. S.D.N.Y. Case No. 10-16172), Webcraft, LLC
(Bankr. S.D.N.Y. Case No. 10-16173), and Webcraft Chemicals, LLC
(Bankr. S.D.N.Y. Case No. 10-16174).
Mark A. McDermott, Esq., and Kenneth S. Ziman, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, serve as counsel to the Debtors.
Kurtzman Carson Consultants is the claims and notice agent.
Perella Weinberg Partners is the investment banker and financial
advisor. FTI Consulting Inc. is the restructuring and financial
advisor.
This is not the Debtors' first journey through chapter 11. On
July 15, 2008, Vertis and American Color Graphics, each commenced
prepackaged chapter 11 cases (Bankr. D. Del. Case No. 08-11460) to
complete a merger. In August 2008, Vertis emerged from
bankruptcy, completing a merger with ACG.
VIASPACE INC: Incurs $770,000 Net Loss in September 30 Quarter
--------------------------------------------------------------
VIASPACE Inc. reported financial results for the third quarter
ended September 30, 2010. Net loss for the quarter was $770,000
compared to a net loss in third-quarter 2009 of $664,000. Net
loss for third-quarter 2010 and third-quarter 2009 was less than
$0.01 per share in each quarter.
The Company's balance sheet at Sept. 30, 2010, showed
$17.95 million in total assets, $2.79 million in total current
liabilities, $4.26 long-term liabilities due to Sung Hsien Chang,
and stockholders' equity of $10.89 million.
Total revenue for the quarter was $912,000 which included $855,000
from Inter-Pacific Arts and $57,000 from U.S. military contracts
for security products with the U.S. Navy and U.S. Army. Total
revenue for third-quarter 2009 was $1.235 million and included
$1.06 million from IPA and $171,000 from U.S. military contracts
for security products.
For the quarter, cost of revenues was $682,000, compared to
$762,000 in third-quarter 2009. Gross profit for the quarter was
$230,000, compared to gross profit of $473,000 for third-quarter
2009.
Total operating expenses for the quarter were $982,000, including
$928,000 of selling, general and administrative expense and
$54,000 for operations. SG&A included $480,000 in stock-based
compensation. Total operating expenses for third-quarter 2009
were $1.047 million and included $1.041 million in SG&A and $6,000
for operations. SG&A in third-quarter 2009 included $458,000 in
stock-based compensation. Operating loss for the quarter was
$752,000, compared to an operating loss of $574,000 in third-
quarter 2009.
Third-quarter 2010 other expense, net, was $18,000, compared to
other expense, net, of $90,000 for third-quarter 2009.
VIASPACE Chief Executive Dr. Carl Kukkonen commented: "Third-
quarter results were affected by lower consumer spending, with
retailers' orders for artwork declining from prior year levels.
However, IPA sales for the quarter were 38% higher than second-
quarter 2010. Also, the impact of lower revenues was partially
mitigated by continuing control of operating expenses, which
remains a tactic to conserve resources.
"I just returned from spending most of October in Asia where I
visited the plantation and conducted several tours for potential
customers. Visiting the plantation and seeing Giant King Grass in
person is an important part of their due diligence. Most of our
business discussions are covered by confidentiality agreements and
we are not free to name specific companies. We only offer
plantation tours to qualified parties that have signed a
confidentiality agreement."
Kukkonen continued," I believe that Giant King Grass exceeded the
expectations of the potential customers that visited the
plantation. Seeing is believing. No customer has seen an energy
crop that is anywhere near as productive as Giant King Grass.
Furthermore, our agronomists are very familiar with switchgrass,
miscanthus, Arundo Donax, sugarcane, bana and elephant grass.
Giant King Grass has much higher yield in terms of tons per acre
than any of these. High yield means low cost, and this is the
main attraction for customers, along with reliability of supply."
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?6edd
A full-text copy of the earnings release is available for free
at http://ResearchArchives.com/t/s?6ede
About VIASPACE Inc.
Irvine, Calif.-based VIASPACE Inc. (OTC Bulletin Board: VSPC -
News) -- http://www.VIASPACE.com/-- is a clean energy company
providing products and technology for renewable and alternative
energy that reduce or eliminate dependence on fossil and high-
pollutant energy sources. Through its majority-owned subsidiary
VIASPACE Green Energy Inc., the Company grows Giant King Grass as
a low carbon fuel for electricity generating power plants and as a
feedstock for cellulosic biofuels.
VIEW SYSTEMS: Incurs $35,463 Net Loss in Third Quarter
------------------------------------------------------
View Systems, Inc., for the three months ended September 30,
incurred net loss of $35,463 compared with net loss of $140,557
for the same period in 2009. Net revenue was $243,095 in the
three months ended Sept. 30, 2010, compared with $81,384 in the
same period in 2009.
The Company's balance sheet at September 30, 2010, showed
total assets $1,324,731, total liabilities of $1,333,907 and a
stockholders' deficit of $9,176.
A full-text copy of the Quarterly Report is available for free at:
http://ResearchArchives.com/t/s?6f96
Baltimore, Maryland-based View Systems, Inc., develops, produces
and markets computer software and hardware systems for security
and surveillance applications.
Going Concern Doubt
Larry O'Donnell, CPA, P.C., expressed substantial doubt about the
Company's ability to continue as a going concern. Mr. O'Donnell
noted that of the Company's net loss for 2009 and accumulated
deficit of $22.3 million at December 31, 2009.
The Company has incurred, and continues to incur, losses from
operations. For the periods ended June 30, 2010, and December 31,
2009, the Company incurred net losses of $258,602 and
$1.6 million, respectively. In addition, certain notes payable
have come due and the note holders are demanding payment.
VM ASC: Gets Court's Nod to Appoint Chapter 11 Trustee
------------------------------------------------------
VM ASC Partnership sought and obtained approval from the U.S.
Bankruptcy Court for the Western District of Pennsylvania to
appoint a Chapter 11 Trustee.
Stipulations were filed in these nine related cases: Hampton Inn
Altoona, Pennsylvania, LP, Morris Management Real Estate, LP,
Altoona VVB, LP, 200 East Plank Road, LP, Altoona Pizza One, Inc.,
Tyrone PCH, LP, MMFRE Limited Partnership, VenMor Tipton
Partnership and Morris Management Harrisburg, LP, by and between
Gregory S. Morris, Raymond C. Hess and Joseph M. Reilly, Co-
Administrators of the Estate of Joseph B. Ventura and Caroll P.
Osgood, M.D. and Diane S. Osgood. Those Stipulations provide,
inter alia, for the appointment of a Trustee in the nine related
Chapter 11 Cases.
Altoona, Pennsylvania-based VM ASC Partnership filed for Chapter
11 bankruptcy protection on November 12, 2010 (Bankr. W.D. Pa.
Case No. 10-71330). Robert O. Lampl, Esq., who has an office in
Pittsburgh, Pennsylvania, assists the Debtor in its restructuring
effort. The Debtor estimated its assets at $10 million to
$50 million and debts at $1 million to $10 million.
Affiliates 200 East Plank Road, L.P. (Bankr. W.D. Pa. 10-70679),
et al., filed separate Chapter 11 petitions.
WARNER MUSIC: Verdict on Shareholder Suit vs. Vivendi on Jan. 21
----------------------------------------------------------------
As previously disclosed by Warner Music Group Corp., APPAC, a
minority shareholder group of Vivendi Universal, initiated an
inquiry in the Paris Court of Appeal into various issues relating
to Vivendi, including Vivendi's financial disclosures, the
appropriateness of executive compensation, and trading in Vivendi
stock by certain individuals previously associated with Vivendi.
The inquiry has encompassed certain trading by Mr. Bronfman in
Vivendi stock. Several individuals, including Mr. Bronfman and
the former CEO, CFO and COO of Vivendi, had been given the status
of "mis en examen" in connection with the inquiry. Although there
is no equivalent to "mis en examen" in the U.S. system of
jurisprudence, it is a preliminary stage of proceedings that does
not entail any filing of charges.
In January 2009, the Paris public prosecutor formally recommended
that no charges be filed and that Mr. Bronfman not be referred for
trial. On October 22, 2009, the investigating magistrate rejected
the prosecutor's recommendation and released an order referring
for trial Mr. Bronfman and six other individuals, including the
former CEO, CFO and COO of Vivendi. While the inquiry encompassed
various issues, Mr. Bronfman was referred for trial solely with
respect to certain trading in Vivendi stock. The trial concluded
on June 25, 2010. At the trial, the public prosecutor argued that
Mr. Bronfman and all of the other defendants in the trial should
be acquitted.
In addition, the lead civil claimant in the case, APPAC, stated
that it believed Mr. Bronfman should be acquitted. The outcome
of the trial and any subsequent proceedings with respect to Mr.
Bronfman is uncertain at this time. Mr. Bronfman believes that
his trading in Vivendi stock was at all times proper.
The court originally announced that it would deliver its verdict
on November 19, 2010, but later advised that the verdict date was
being postponed. On November 19, 2010, the court announced that
it now intends to deliver its verdict on January 21, 2011.
About Warner Music Group
Based in New York, Warner Music Group Corp. (NYSE: WMG)
-- http://www.wmg.com/-- was formed by a private equity
consortium of investors on November 21, 2003. The Company is the
direct parent of WMG Holdings Corp., which is the direct parent of
WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's
major music-based content companies and the successor to
substantially all of the interests of the recorded music and music
publishing businesses of Time Warner Inc.
The Company classifies its business interests into two fundamental
operations: Recorded Music and Music Publishing. The Company's
Recorded Music business primarily consists of the discovery and
development of artists and the related marketing, distribution and
licensing of recorded music produced by such artists. The
Company's Music Publishing operations include Warner/Chappell, its
global Music Publishing company, headquartered in New York with
operations in over 50 countries through various subsidiaries,
affiliates and non-affiliated licensees.
The Company's balance sheet at June 30, 2010, showed $3.65 billion
in total assets, $3.82 billion in total liabilities, and
a stockholders' deficit of $174 million.
* * *
As reported by the Troubled Company Reporter, Standard & Poor's
Ratings Services on Aug. 13, 2010, revised its rating outlook on
Warner Music Group Corp. to negative from stable. Ratings on the
company, including the 'BB-' corporate credit rating, were
affirmed. "The revised outlook reflects continued revenue and
EBITDA declines amid a light album release schedule and ongoing
challenges in maintaining profitability levels due to the digital
transition taking place within the industry, notwithstanding
vigilant cost management," said Standard & Poor's credit analyst
Michael Altberg.
As reported by the TCR on October 4, 2010, Fitch affirmed these
ratings: Warner Music Group Corp. (IDR at 'BB-'.); WMG Holdings
Corp. (IDR at 'BB-'; and -- Unsecured notes at 'B'); and WMG
Acquisition Corp. (IDR at 'BB-'; Secured notes at 'BB';
Subordinated notes at 'B+').
Fitch's ratings are supported by WMG's market position as the
third largest music distributor/label, with a 20% market share
according to Nielsen SoundScan. Fitch said liquidity is
sufficient, as the company generates sufficient cash to support
operations and capital expenditures. As of June 30, 2010, WMG had
$400 million in consolidated cash and cash equivalents (including
$176 million of cash at the parent holding company). There are no
maturities until 2014, when approximately $900 million in
subordinated debt (including WMG Holdings Corp. notes) are due.
Standard & Poor's Ratings Services lowered its corporate credit
rating on New York City-based Warner Music Group Corp. to 'B+'
from 'BB-'. The rating outlook is stable.
WASTE2ENERGY HOLDINGS: Delays Filing of Quarterly Report
--------------------------------------------------------
Waste2Energy Holdings Inc. said it could not timely file its Form
10-Q for the quarter ended Sept. 30, 2010, because the
compilation, dissemination and review of the information required
to be presented in the report for the relevant period has imposed
time constraints that have rendered timely filing of the Form 10-Q
impracticable without undue hardship and expense to the
registrant.
About Waste2Energy Holdings
Greenville, S.C.-based Waste2Energy Holdings, Inc. (Pink Sheets:
WTEZ) -- http://www.waste2energy.com/-- is a "cleantech"
technology company that designs, builds, installs and sells waste
to energy plants that generate "Renewable Green Power" converting
biomass or other solid waste streams traditionally destined for
landfills into clean renewable energy.
The Company's balance sheet at June 30, 2010, showed $3.4 million
in total assets, $11.7 million in total liabilities, and a
stockholders' deficit of $8.3 million.
As reported in the Troubled Company Reporter on July 19, 2010,
Marcum LLP, in New York, expressed substantial doubt the Company's
ability to continue as a going concern, following its results for
the fiscal year ended March 31, 2010. The independent auditors
noted that the Company has incurred a significant loss from
continuing operations of $11.7 million and used cash of
$5.2 million for continuing operations which resulted in an
accumulated deficit of $30.4 million and a working capital
deficiency of $6.6 million as of March 31, 2010.
Default
On October 30, 2010, a total of $87,500 of principal amount of the
Company's 12% Senior Convertible Debentures became due. On
November 2, 2010, $40,000 of principal amount of the Debentures
became due. The Company did not make the required payment on the
maturity date or by the cure period provided by the Debentures and
as result an Event of Default under the Debentures has occurred.
As a result of the Event of Default, the outstanding principal
amount of the Debentures plus accrued but unpaid interest,
liquidated damages and other amounts owing in respect thereof
through the date of the acceleration will become at the election
of the holder of the Debenture immediately due and payable in cash
at the Mandatory Default Amount.
WATCH CENTRAL: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Watch Central Repair, Inc.
500 Fifth Avenue, Suite 215
New York, NY 10110
Bankruptcy Case No.: 10-16287
Chapter 11 Petition Date: November 24, 2010
Court: U.S. Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Shelley C. Chapman
Debtor's Counsel: Jonathan S. Pasternak, Esq.
RATTET, PASTERNAK & GORDON OLIVER, LLP
550 Mamaroneck Avenue, Suite 510
Harrison, NY 10528
Tel: (914) 381-7400
Fax: (914) 381-7406
E-mail: jsp@rattetlaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Alexander Vileshin, president.
WENTWORTH ENERGY: Posts $2.94MM Net Loss in Third Quarter
---------------------------------------------------------
Wentworth Energy, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $2,940,324 for the quarter ended
September 30, 2010, compared with a net loss of $1,781,897 for the
same period a year ago. Revenue was $110,272 in the three months
ended Sept. 30, 2010, compared with $95,152 in the year before.
The Company's balance sheet at September 30, 2010, showed
$19,823,843 in total assets, $73,880,395 in total liabilities, and
$54,056,552 in stockholders' equity.
As reported in the Troubled Company Reporter on April 21, 2010,
MaloneBailey, LLP, in Houston, Texas issued a going concern
qualification following the Company's 2009 results. The
independent auditors noted that the Company suffered losses from
operations and has a working capital deficiency, which raises
substantial doubt about its ability to continue as a going
concern.
In the Form 10-Q, the Company said its ability to continue as a
going concern is dependent upon achieving profitable operations,
receiving deferrals of the interest payments due and a waiver of
its defaults of the amended debt agreements from its senior
secured convertible note holders and convertible debenture holder,
and injection of additional capital.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?6f81
Wentworth Energy, Inc., is an exploration and production company
engaged in oil and gas exploration, drilling and development. The
Company has oil and gas interests in Anderson County, Freestone
County, and Jones County, Texas.
WESTLAND PARCEL: Gets Court's Interim Nod to Use Cash Collateral
----------------------------------------------------------------
Westland Parcel J Partners, LLC, sought and obtained interim
authorization from the Hon. Peter H. Carroll of the U.S.
Bankruptcy Court for the Central District of California to use the
cash collateral of Pacific Western National Bank and T. Courtney
Dubar through December 15, 2010.
PWNB's claim of approximately $14,520,000 is secured by the
Debtor's ground leasehold and improvements with a current market
value of $17,500,000. The claim of Mr. Dubar, the Debtor's
managing member, of $3,200,000 is secured by the same property as
PWNB.
Jeffrey S. Shinbrot, Esq., at Jeffrey S. Shinbrot, APLC, explained
that the Debtor needs the money to fund its Chapter 11 case, pay
suppliers and other parties. The Debtor will use the collateral
pursuant to a budget, a copy of which is available for free at:
http://bankrupt.com/misc/WESTLAND_PARCEL_budget.pdf
In exchange for using the cash collateral, creditors holding a
secured interest in cash collateral are granted replacement liens
to the same validity and priority as their prepetition date liens.
A final hearing on the use of cash collateral will be held on
December 15, 2010, at 9:30 a.m.
Long Beach, California-based Westland Parcel J Partners, LLC,
filed for Chapter 11 bankruptcy protection on November 15, 2010
(Bankr. C.D. Calif. Case No. 10-58987). Jeffrey S Shinbrot, Esq.,
at The Shinbrot Firm, assists the Debtor in its restructuring
effort. The Debtor estimated its assets and debts at $10 million
to $50 million.
Affiliate David William Neary (Bankr. C.D. Calif. Case No. 10-
39802) filed separate Chapter 11 petition on July 20, 2010.
WESTLAND PARCEL: Taps Jeffrey S. Shinbrot as General Counsel
------------------------------------------------------------
Westland Parcel J Partners, LLC, asks for authorization from the
U.S. Bankruptcy Court for the Central District of California to
employ Jeffrey S. Shinbrot, A professional Law Corporation, as
general insolvency counsel.
The Firm will provide legal advice and guidance with respect to
the powers, duties, rights and obligations of the Debtor as
debtor-in-possession, the formulation and preparation of a plan of
reorganization and disclosure statement, and preparation of legal
documents as may be necessary.
The Firm will be paid based on the rates of its professionals:
Jeffrey S. Shinbrot $425
Paralegals $150
Jeffrey S. Shinbrot, an attorney at the Firm, assures the Court
that the firm is a "disinterested person" as that term defined in
Section 101(14) of the Bankruptcy Code.
Long Beach, California-based Westland Parcel J Partners, LLC,
filed for Chapter 11 bankruptcy protection on November 15, 2010
(Bankr. C.D. Calif. Case No. 10-58987). The Debtor estimated its
assets and debts at $10 million to $50 million.
Affiliate David William Neary (Bankr. C.D. Calif. Case No. 10-
39802) filed separate Chapter 11 petition on July 20, 2010.
WESTMORELAND COAL: Unit Extends First Bank Revolver by 30 Days
--------------------------------------------------------------
On November 12, 2010, Westmoreland Resources Inc., a wholly-owned
subsidiary of Westmoreland Coal Company, entered into a 30-day
extension of its revolving line of credit with First Interstate
Bank, Billings, Montana. All other terms of the borrowing remain
the same during the extension period. Outstanding borrowings at
November 12, 2010 were $12.6 million. During the extension
period, WRI will be working with FIB to finalize the renewal of
the revolving line of credit. As a result of significant
increases in operating profits, a decrease in the Company's
heritage health benefit costs, and an increase in WRI's term debt,
the Company anticipates that its cash from operations and
available borrowing capacity will be sufficient to meet its cash
requirements for the foreseeable future.
The Company projects that the margin by which it will be able to
meet its cash requirements will increase over the remainder of
2010 and into 2011. The Company believes it can satisfy its
liquidity needs for the foreseeable future without relying on
proceeds from sales of assets or securities or other capital-
raising transactions.
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company is an
energy company whose operations include five surface coal mines in
Montana, North Dakota and Texas and two coal-fired power-
generating units with a total capacity of 230 megawatts in North
Carolina. The Company sold 24.3 million tons of coal in 2009.
The Company's two principal operating segments are its coal
segment and its power segment, in addition to two non-operating
segments.
As reported in the Troubled Company Reporter on March 15, 2010,
KPMG LLP, in Denver, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that of the Company's recurring losses from
operations, working capital deficit and net capital deficiency.
WII COMPONENTS: S&P Withdraws 'B-' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services said that it withdrew all of
its preliminary ratings, including its preliminary 'B-' corporate
credit rating, on cabinet components manufacturer WII Components
Inc. because the company's proposed $115 million senior secured
notes offering was not completed.
WINDSTREAM CORP: Moody's Raises Speculative Grade Liquidity Rating
------------------------------------------------------------------
Moody's Investors Service raised Windstream's Speculative Grade
Liquidity Rating back to SGL-1, from SGL-2, due to restoration of
the company's very good liquidity profile following the increase
in capacity under its senior secured revolving credit facility to
$750 million from $500 million. The company expects to use a
portion of the revolving facility to fund the cash needed to close
the pending acquisitions of Kentucky Data Link and Hosted
Solutions.
Moody's most recent rating anouncement for Windstream was on
November 5, 2010. At that time, Moody's affirmed the company's
Ba2 CFR and lowered the SGL rating to SGL-2 from SGL-1.
Windstream, headquartered in Little Rock, AR, is an ILEC providing
telecommunications services in 21 states and generated about
$3.5 billion in annual revenues in the twelve months ended
September 30, 2010.
WIZZARD SOFTWARE: Posts $770,724 Net Loss in Third Quarter
----------------------------------------------------------
Wizzard Software Corporation filed its quarterly report on Form
10-Q, reporting a net loss available to common shareholders of
$770,724 on $1,472,121 revenue for the three months ended
September 30, 2010. This compares to a net loss of $1,508,249 on
$1,384,218 of revenue in the same period in 2009.
The Company's balance sheet at September 30, showed total assets
of $21,811,852, total liabilities of $2,562,303 and stockholders'
equity of $19,249,549.
A full-text copy of the Form 10-Q is available for free at:
http://ResearchArchives.com/t/s?6f97
About Wizzard Software
Pittsburgh, Pa.-based Wizzard Software Corporation provides
software products and services for the speech recognition and
text-to-speech technology. It operates in three segments:
Software, Healthcare, and Media Services. The Software segment
engages in the development, sale, and service of custom and
packaged computer software products. The Media Services segment
provides podcast hosting, content management tools, and
advertising services. The Healthcare segment provides home
healthcare and healthcare staffing services in Wyoming and
Montana.
Going Concern Doubt
Gregory & Associates, LLC, in Salt Lake City, expressed
substantial doubt about the Company's ability to continue as a
going concern after auditing the Company's financial statements
for the year ended December 31, 2009. The independent auditors
noted that the Company has not yet established profitable
operations and has incurred significant losses since its
inception.
WJO INC: Taps Ciardi Ciardi as Bankruptcy Counsel
-------------------------------------------------
WJO, Inc., asks for authorization from the U.S. Bankruptcy Court
for the Eastern District of Pennsylvania to employ Ciardi Ciardi &
Astin as bankruptcy counsel.
Ciardi Ciardi will, among other things:
a. prepare papers and legal documents required to be filed in
connection with the Debtor's bankruptcy proceeding;
b. negotiate with creditors;
c. pursue existing litigation; and
d. participate in the formulation of a plan.
Ciardi Ciardi will be paid based on the rates of its
professionals:
Albert A. Ciardi, III $465
Thomas D. Bielli $275
Holly E. Smith $275
Alex Giuliano, Paralegal $120
Albert A. Ciardi, III, a partner at Ciardi Ciardi, assures the
Court that the firm is a "disinterested person" as that term
defined in Section 101(14) of the Bankruptcy Code.
Bristol, Pennsylvania-based WJO, Inc., operates six family
practices located in Newtown, Bristol, Bensalem, Bustleton, South
Philadelphia, and Bethlehem, Pennsylvania and consists of Board
Certified Osteopathic Physicians specializing in Family Medicine.
WJO filed for Chapter 11 bankruptcy protection on November 15,
2010 (Bankr. E.D. Pa. Case No. 10-19894). The Debtor estimated
its assets and debts at $10 million to $50 million.
XODTEC LED: Yuan-Fu Cheng Resigns as Chief Financial Officer
------------------------------------------------------------
On November 18, 2010, Yuan-Fu Cheng resigned as chief financial
officer of Xodtec LED Inc. for personal reasons. The resignation
of Mr. Cheng did not stem from any disagreement with the Company.
The Company's board of directors appointed Yao-Ting Su, the
Company's chief executive officer, as chief financial officer.
Yao-Ting Su has been the Company's Chairman since April 2009 and
chief executive officer since January 2010. Mr. Su served as the
Company's president, from April 2009 until April 2010. Mr. Su
received a Bachelor's Degree from Soochow University and was the
Valedictorian of the Air Defense Missile School of the United
States Army in Fort Bliss, Texas. Mr. Su also served in the Army
of Taiwan from 1979 to 1981.
Mr. Su does not have an agreement covering his services as chief
executive officer and chief financial officer. Mr. Su presently
receives annual compensation of $120,000 for his services as chief
executive officer.
About Xodtec LED
Headquartered in Jhonghe City, Taiwan, Xodtec LED, Inc. is a
Nevada corporation incorporated on November 29, 2006, under the
name Sparking Events, Inc. On June 28, 2009, the Company's
corporate name was changed to "Xodtec Group USA, Inc." and on
May 17, 2010, the Company's corporate name was changed to "Xodtec
LED, Inc."
The Company, through its subsidiaries, is engaged in the design,
marketing and selling of advanced lighting solutions which are
designed to use less energy and have a longer life than
traditional incandescent, halogen, fluorescent light sources. The
Company's wholly-owned subsidiaries, Xodtec Technology Co., Ltd.;
Targetek Technology Co., Ltd.; UP Technology Co., Ltd., are
organized under the laws of the Republic of China (Taiwan). The
Company also owns a 35% interest in Radiant Sun Development S.A.,
a company organized under the laws of the Independent State of
Samoa.
The Company's balance sheet at August 31, 2010, showed
$1.7 million in total assets, $3.1 million in total liabilities,
and a stockholders' deficit of $1.4 million.
ZAVALA JAVIER: Case Summary & 4 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Zavala Javier
13991 Rancho Dorado Bend
San Diego, CA 92130
Bankruptcy Case No.: 10-20753
Chapter 11 Petition Date: November 23, 2010
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Judge: Margaret M. Mann
Debtor's Counsel: Michael T. Pines, Esq.
PINES AND ASSOCIATES
732 N. Coast Highway 101, Ste B
Encinitas, CA 92024
Tel: (760) 642-0414
E-mail: info@pinesandassociates.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Debtor's four largest unsecured creditors
filed together with the petition is available for free
at http://bankrupt.com/misc/casb10-20753.pdf
* Muni Issuers May Face Default 'Crunch,' Lehmann Says
------------------------------------------------------
Municipal-bond issuers, whose default rate slowed this year, may
face more failures in 2011 as federal economic-stimulus aid
declines and budget pressures jeopardize debt payments, said
Richard Lehmann, publisher of Distressed Debt Securities
Newsletter, according to reporting by Darrell Preston at Bloomberg
News.
Many state and municipal governments still haven't addressed
underlying budget stresses and some borrowed to patch deficits,
meaning issuers may decide not to make promised debt-service
payments, said Mr. Lehmann, 68, who follows defaults.
"Next year may well be the crunch year," Lehmann said Nov. 19 by
telephone from Miami Lakes, Florida. "You may see a new wave of
defaults."
According to Bloomberg News, Mr. Lehmann's data provide that this
year through October, defaulted securities, including those
stemming from missed payments and the "technical" variety, fell to
$2.48 billion, compared with $7.28 billion in 2009 and a record
$8.15 billion in 2008. Technical defaults occur when bond terms
are violated, such as by servicing debt with reserve funds.
* BOOK REVIEW: Working Together - 12 Principles for Achieving
Excellence in Managing Projects, Teams, and
Organizations
-------------------------------------------------------------
Author: James P. Lewis
Publisher: Beard Books
Hardcover: 208 pages
Listprice: $34.95
Review by Henry Berry
Working Together is about the passionate implementation of a set
of management principles that were instrumental in the development
of new airplanes at the Boeing Company and, in particular, the
groundbreaking Boeing 777 aircraft.
The chief engineer of the Boeing 777 program when it was
undertaken in the early 1980s was Alan Mulally. He was soon
promoted to general manager of the project and, in 1986, was named
president of Commercial Airplanes. Mr. Mulally remained with
Boeing for 37 years, eventually leading Boeing Commercial
Airplanes to a turnaround that began in 1996. And if the name
sounds more than familiar, it should: in September 2006, Ford
Motor Company named Mr. Mulally its new President and CEO, citing
his record of success during his long tenure at Boeing. Through
all of those years, Mr. Mulally made the "working together"
principles and practices his gospel. He has been a vocal advocate
of both the principles and this book by James Lewis even during
his highly visible transition to Ford.
Working Together chronicles the application of Mr. Mulally's
leadership principles during his years at Boeing, especially
during the execution of the 777 project. The 12 principles
espoused in "working together" comprise a management philosophy
that enabled Boeing "to dramatically increase production on all of
our airplanes, improve our entire production system, and develop a
number of new airplanes all simultaneously," as Mr. Mulally notes
in the Foreword to the book.
The value and effectiveness of working together is conveyed in a
dramatic way by the author. Lewis introduces the high stakes that
Boeing faced in developing the 777. At first, the company bit off
more than it could chew. Fired by the enthusiasms and passions of
employees exemplified by Mr. Mulally, Boeing pursued an ideal that
exceeded its capacity to meet. At one point, Boeing had to "stop
global production for lack of parts." Boeing was losing money,
risking its future, and disappointing its customers, investors,
and employees.
But the roots of its problems were basically a lack of proper
preparedness and organization. With Mr. Mulally in charge,
operations were revised according to the model of working
together. Work processes were reinforced, reinvigorated, and
closely monitored. Practices such as focused agendas for
meetings, clear assignments, communication among disparate
employee segments, solicitation of input, and keeping a project on
track, were implemented. Boeing underwent a transformation from a
company in danger of permanently damaging its reputation and
competence, to a company that reaffirmed its preeminence in the
field of airplane design and production.
As he took over the reins at Ford, Mr. Mulally observed that many
of the challenges he addressed in commercial airline manufacturing
are analogous to the issues he will now face at the car
manufacturing giant. He stated, "I'm looking forward to working
closely with Bill [Ford] in the ongoing turnaround of this great
company. I'm also eager to begin engagement with the leadership
team. I believe strongly in teamwork and I fully expect that our
efforts will be a productive collaboration."
James P. Lewis is President of Lewis Institute, Inc., a training
and consulting company specializing in project management, which
he founded in 1981. He also teaches seminars on the subject in
the United States, England, and Asia.
*********
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. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard
C. Tolentino, Joseph Medel C. Martirez, Denise Marie Varquez,
Philline Reluya, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R.
Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G.
Patalinghug, and Peter A. Chapman, Editors.
Copyright 2010. 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.
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