/raid1/www/Hosts/bankrupt/TCR_Public/110315.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, March 15, 2011, Vol. 15, No. 73
Headlines
15-35 HEMPSTEAD: Taps Joel Zaslow as Accountant
15-35 HEMPSTEAD: Hearing on Ch.11 Trustee Appointment on March 28
15-35 HEMPSTEAD: Taps Saligman-Decker as Property Manager
1744 PROPERTIES: Voluntary Chapter 11 Case Summary
610-630 E.: Case Summary & Largest Unsecured Creditor
A-111 VENTURE: Case Summary & 3 Largest Unsecured Creditors
A-2 VENTURE: Case Summary & 2 Largest Unsecured Creditors
ACTION ENERGY: Completes Cavalon Deal & Cuts Debt by C1.88MM
AEGIS-EL MONTE: Case Summary & 6 Largest Unsecured Creditors
ALABAMA AIRCRAFT: Seeks to Cut Wages, Throw Out Contract
ALEKSANDRA OSTOJIN-ROVCANIN: N.J. Ct. Rules on Betal Lawsuit
ALTON SQUARE: Goes Into Receivership Following Foreclosure Suit
ANCHOR BLUE: Gets Nod to Tap Streambank as IP Sale Consultant
ANCHOR BLUE: Can Hire Hilco Real Estate as Real Estate Consultant
APPLIED DNA: Incurs $1.34-Mil. Net Loss in Dec. 31 Quarter
BERNARD L MADOFF: Trustee Wins Approval of Hadassah Settlement
BERNARD L MADOFF: Court to Rule on Release of Employees' Names
BLOCKBUSTER INC: Warner Bro.'s Wants Immediate Payment of Debt
BLOCKBUSTER INC: Sony Wants Assurance of Payment from DVD Sales
BLOCKBUSTER INC: Allows Donaldson Case to Proceed on Appeal
BOART LONGYEAR: Moody's Assigns 'Ba2' Corporate Family Rating
CAPRIUS INC: Vintage Capital Has Warrant to Buy 16.64MM Shares
CARPENTER CONTRACTORS: Hires Crowe Horwath as Auditors
CARPENTER CONTRACTORS: Shaw Gussis Bills $14T for Dec-Feb Work
CATHOLIC CHURCH: Dist. Court Affirms Ruling in Suit vs. Insurers
CATHOLIC CHURCH: Del. Court Gives 18th Order on PIA Withdrawals
CB HOLDING: $10-Mil. Sale of Bugaboo Creek Outlets Approved
CF INDUSTRIES: Moody's Upgrades Corporate Family Rating to 'Ba1'
CF INDUSTRIES: Fitch Upgrades Long-Term Issuer Default Rating
CHARLESTON ASSOCIATES: Committee Hires Brinkman as Counsel
CHARLESTON ASSOCIATES: Committee Hires Womble as Delaware Counsel
CITADEL BROADCASTING: Cumulus Media Deal Won't Move Moody's Rating
CJS HOLDINGS: Bankruptcy Filing Stays Checkers Lawsuit
CLAIRE'S STORES: Bank Debt Trades at 3% Off in Secondary Market
CLAIRE'S STORES: Moody's Upgrades Ratings on Senior Loan to 'B3'
CLEAR CHANNEL: Bank Debt Trades at 12% Off in Secondary Market
CMB III: Taps Mariscal as Counsel in Int'l Cruise Action
CMS ENERGY: Fitch Affirms 'BB+' Long-Term Issuer Default Rating
COMCAM INT'L: Pinnacle Had $1.34-Mil. in Assets when Acquired
COMMERCIAL VEHICLE: Computershare Rights Agreement Terminates
CONSTELLATION ENTERPRISES: S&P Assigns 'B' Corporate Credit Rating
CONSTRUCTORA CJ: Case Summary & 20 Largest Unsecured Creditors
COUNTERPATH CORP: Posts $491,200 Net Loss in Jan. 31 Quarter
CUMULUS MEDIA: Bank Debt Trades at 1% Off in Secondary Market
DEX MEDIA EAST: Bank Debt Trades at 22% Off in Secondary Market
DEX MEDIA WEST: Bank Debt Trades at 10% Off in Secondary Market
DOO WOP: Case Summary & 20 Largest Unsecured Creditors
DRYSHIPS INC: Ocean Rig to Hold Shareholders Meeting on April 15
DOUMULIN SOLUTIONS: Pursues Reorganization Case in Canada
DYNEGY INC: Inks Consulting Pact and Release With Ex-CFO
DYNEGY INC: Seneca and Icahn Name New Members to Board
DYNEGY INC: Waives Section 203 of General Corporation Law
EV ENERGY: Moody's Assigns 'B1' Corporate Family Rating
FANNIE MAE: Former Exec. Receives Wells Notice From SEC
FIBRE CRAFT: Case Summary & 20 Largest Unsecured Creditors
FIRST NATIONAL: Closed; Pauls Valley National Assumes All Deposits
FIVE STAR FOODS: Voluntary Chapter 11 Case Summary
FLINT TELECOM: Delays Registration of 12-Mil. Kodiak Shares
FORBES ENERGY: S&P Raises Corporate Credit Rating to 'CCC+'
FOREVER CONSTRUCTION: Status Hearing on May 5
FREDDIE MAC: EVP Bisenius to Step Down Effective April 1
GARRYAVE, LLC: Case Summary & 2 Largest Unsecured Creditors
GENERAL GROWTH: Court Allows WTC to Continue Holding $14.66-Mil.
GENERAL GROWTH: Gen. Trust Requests for $598,337 Admin. Claim
GENERAL GROWTH: GGP Wants Cure Objections Deemed Resolved
GENERAL MOTORS: Internal Revenue Service's Claims Resolved
GMX RESOURCES: BlackRock Discloses 4.94% Equity Stake
HAMPTON ROADS: Incurs $211.34 Million Net Loss in 2010
HCA HOLDINGS: Registers Add'l 2.53MM Shares of Common Stock
HCA HOLDINGS: Two Directors Do Not Own Any Securities
HCA HOLDINGS: To Issue 87,719,300 Add'l Common Shares
HEALTHY FAST: Recurring Losses Cue Going Concern Doubt
HEARTLAND AUTOMOTIVE: Quad-C Buys Connecticut Jiffy Lube Operator
HERCULES OFFSHORE: Incurs $134.59 Million Net Loss in 2010
HERCULES OFFSHORE: Pellegrin's Annual Salary Hiked to $250,000
HILLMAN GROUP: Moody's Assigns 'B3' Rating to $50 Mil. Notes
HILLMAN GROUP: S&P Affirms 'CCC+' Rating on Senior Unsec. Debt
HOLLIFIELD RANCHES: Court Approves Garald Price as Accountant
HOTEL SOLUTIONS: Dumoulin Unit Wants US Recognition of CCAA Case
HOTEL SOLUTIONS: Chapter 15 Case Summary
HRAF HOLDINGS: Wants Plan Exclusivity Extended Until Sept. 4
HUME BANK: Former President Sentenced to Six Years in Jail
IMPLANT SCIENCES: Restates 2010 Financials Due to Errors
INNKEEPERS USA: Lehman, Five Mile to Lead May 2 Auction
INTRACOASTAL HOSPITALITY: Water Club Seeks Ch. 11 Amid Eviction
IPICO INC.: Ontario Court OKs Interim Loan Facility
ISLAND ONE: Panel Taps Bush Ross as Bankruptcy Counsel
JAG MANAGEMENT: Case Summary & 3 Largest Unsecured Creditors
JAISUEL CONTRACTOR: Case Summary & Largest Unsecured Creditor
JEFFERSON COUNTY: Outlines Strategy to Address $3.2 Billion Debt
JEFFERSON COUNTY: Ending Jobs Tax May Force Bankruptcy Filing
JOY LANE: Voluntary Chapter 11 Case Summary
JUMA TECHNOLOGY: Gets $350,000 From Sale of Note to Vision
K-V PHARMACEUTICAL: Incurs $34.6-Mil. Net Loss in Fiscal Q1
KIMHYO, LLC: Voluntary Chapter 11 Case Summary
KINDRED HEALTHCARE: S&P Assigns 'B+' Corporate Credit Rating
LANIER LODGE: May Recover Nominal Damages in Manton Suit
LEGACY BANK: Closed; Seaway Bank and Trust Co Assumes All Deposits
LIMEHOUSE VILLAGE: Case Summary & 3 Largest Unsecured Creditors
LIZ CLAIBORNE: S&P Cuts Corp. to 'CC' on Below Par Cash Offer
LOAN EXCHANGE: Taps County Law Center as Bankruptcy Counsel
LOMBARD PUBLIC: S&P Cuts Issue Ratings to 'CC' on Distressed Offer
M&S GRADING: IRS Not Required to Ensure Payroll Tax Payments
MAYS PRINTING: Case Summary & 9 Largest Unsecured Creditors
MEDICAL INVESTORS: Case Summary & 16 Largest Unsecured Creditors
MICROVISION INC: Recurring Losses Cue Going Concern Doubt
MOLECULAR INSIGHT: Holders of $200-Mil. in Bonds in Plan Talks
MONEYGRAM INT'L: Inks Recapitalization Pact With Goldman Sachs
MONEYGRAM INT'L: Thomas H. Lee Discloses 54.0% Equity Stake
MONEYGRAM INT'L: Inks Recapitalization Pact With Silver Point
MYLAN INC: Moody's Upgrades Corporate Family Rating to 'Ba2'
NAVISTAR INTERNATIONAL: Reports $6-Mil. Profit in Jan. 31 Qtr.
NBC ACQUISITION: Posts $16.29-Mil. Net Loss in Dec. 31 Qtr.
NCO GROUP: Seeks to Amend $704 Million of Credit Facility
NEW HORIZONS: Case Summary & 15 Largest Unsecured Creditors
NEW STREAM: Files for Chapter 11 with Prepackaged Plan
NEW STREAM: Case Summary & Largest Unsecured Creditors
NEXEN INC: Moody's Confirms 'Ba1' Rating to Subordinated Notes
NEXSTAR BROADCASTING GROUP: Incurs $1.81-Mil. Net Loss in 2010
NW358, LLC: Voluntary Chapter 11 Case Summary
NORTEL NETWORKS: Completes Sale of MSS Business to Ericsson
ORANGE GROVE: Hiring Jerome Cohen as Replacement Ch. 11 Counsel
ORANGE GROVE: Has Go Signal to Hire Special Litigation Counsel
OVERSEAS SHIPHOLDING: Moody's Downgrades Issuer Rating to 'B1'
PHILADELPHIA RITTENHOUSE: Lender iStar Takes Aim at Sale Request
PJ FINANCE: Has Court OK to Hire KCC as Claims Agent
PJ FINANCE: Has Court's Interim Nod to Use Cash Collateral
PJ FINANCE: Section 341(a) Meeting Scheduled for April 6
PJ FINANCE: Wants to Enter Into Financing Arrangement With Gaia
PLATINUM ENERGY: Bradley Radoff Discloses 5.0% Equity Stake
POWERPLUS ELECTRIC: Case Summary & 20 Largest Unsecured Creditors
QA3 LLC: Case Summary & 22 Largest Unsecured Creditors
QUALITY DISTRIBUTION: Incurs $10.68MM Net Loss in Dec. 31 Qtr.
QUEPASA CORP: B. Garrett Has Option to Buy 379,221 Common Shares
QUINTILES TRANSNATIONAL: Moody's Affirms 'B1' Corp. Family Rating
R&G FINANCIAL: Puerto Rico Court Stays Rodriguez Suit
REVIVAL OUTREACH: Case Summary & Largest Unsecured Creditor
REYNOLDS & REYNOLDS: S&P Puts 'BB+' Issue-Level Rating
RIO RANCHO: Files Schedules of Assets & Liabilities
RIO RANCHO: Has Court's Interim Nod to Use Cash Collateral
RIO RANCHO: Section 341(a) Meeting Scheduled for April 5
RIO RANCHO: Taps Law Offices of Lee & Kent as Bankruptcy Counsel
RITE AID: Bank Debt Trades at 4% Off in Secondary Market
ROYAL PROFESSIONAL: Case Summary & 8 Largest Unsecured Creditors
SBARRO INC: Moody's Cuts Probability of Default Rating to 'Ca/LD'
SCENIC VIEW: Case Summary & 16 Largest Unsecured Creditors
SEAGATE TECHNOLOGY: WD AND Hitachi Deal Won't Move Moody's Rating
SIDERA NETWORKS: S&P Assigns 'B' Rating to $310 Mil. Loan
SEAHAWK DRILLING: Receives Final Approval for $35 Million Loan
SEQUENOM INC: Files Form 10-K; Posts $120.8-Mil. Loss in 2010
SOLOMON DWEK: Dist. Court Affirms Ruling Against Uncle's Suit
SONJA TREMONT-MORGAN: May Pursue Appeal on $7 Million Judgment
SUNCAL COS: Residents Raise Doubt Over Project Amid Bankruptcy
SUPER MART: Case Summary & 7 Largest Unsecured Creditors
THORNBURGH RESORT: Case Summary & 20 Largest Unsecured Creditors
TOMAS CONCEPCION: Filing of Claim Does Not Determine Entitlement
TRIBUNE CO: Bank Debt Trades at 30% Off in Secondary Market
UNI-PIXEL INC: Incurs $3.81 Million Net Loss in 2010
UNISYS CORP: Lists 2.25MM Shares of Preferred Stock With NYSE
UNITED CONTINENTAL: Circuit Court Affirms Ruling on Regen Issue
UNITED CONTINENTAL: To Reduce Capacity as Oil Prices Rise
UNITED CONTINENTAL: Makes $224-Mil. Profit-Sharing Payments
VIEW SYSTEMS: Accumulated Losses Cue Going Concern Doubt
VILLAJE DEL RIO: Dist. Court Rules on Andres Holding Dispute
VITESSE SEMICONDUCTOR: Register 2.5-Mil. Shares for Emplyee Plan
W&T OFFSHORE: S&P Changes Ratings on $450 Mil. Senior Notes to 'B'
WASHINGTON MUTUAL: Confirms Release of REIT Series Securities
WILLIE'S PLACE: TCA Makes Winning Offer at $6.4 Million
WILLOW CREEK: Voluntary Chapter 11 Case Summary
WINDSOR RETIREMENT: Workers Promised Outstanding Salary
WORLD'S FOREMOST: Settlement Announced for Bank's Malpractices
W.R. GRACE: District Court Sets Deadline for Plan Appeals
W.R. GRACE: Court Revises CNA Deal Order with BNSF Issue
W.R. GRACE: Wins Approval of Settlement of MassDEP's Claims
W.R. GRACE: Montana & Libby Victims Negotiate $43-Mil. Settlement
WYTHE II CORP: Texas App. Ct. Rules on Stone Fee Dispute
* Means Test Applies to Cases Converted From Chapter 13
* Appellate Panel Shouldn't Make Findings of Fact, Court Says
* New York Community Bank Sells Mortgage on 8 Bronx Buildings
* Lynnette Warman Named Fellow of American College of Bankruptcy
* Large Companies With Insolvent Balance Sheets
**********
15-35 HEMPSTEAD: Taps Joel Zaslow as Accountant
-----------------------------------------------
15-35 Hempstead Properties, LLC, won permission from the
Bankruptcy Court to employ as accountant:
Joel Zaslow, CPA
5 Schenck Avenue, Suite 3E
Great Neck, NY 11021
The Debtor said it needs an accountant to assist in completing its
monthly operating reports. The accountant will be paid $250 per
hour plus reimbursement of costs and expenses.
About 15-35 Hempstead Properties
15-35 Hempstead Properties, LLC, owns real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on
Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi &
Astin, assists 15-35 Hempstead in its restructuring effort.
15-35 Hempstead estimated its assets and debts at $10 million to
$50 million.
Affiliate Jackson 299 Hempstead, LLC, filed a separate Chapter 11
petition (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010.
Jackson 299 Hempstead, LLC, owns a parcel of real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43180) on Oct.
26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin,
assists Jackson 299 in its restructuring effort. Jackson 299
estimated its assets and debts at $10 million to $50 million.
The cases are jointly administered under 15-35 Hempstead
Properties, LLC.
15-35 HEMPSTEAD: Hearing on Ch.11 Trustee Appointment on March 28
-----------------------------------------------------------------
Bankruptcy Judge Gloria M. Burns will resume hearing on March 28,
2011, at 11:30 a.m. in Camden, to consider the request of secured
lender New York Community Bank for appointment of a chapter 11
trustee in the bankruptcy case of 15-35 Hempstead Properties, LLC.
New York Community Bank also has a pending motion for relief from
the automatic stay imposed in the case. That matter is up for
hearing on April 11 at 10:00 a.m.
At the March 28 hearing, the Court will also consider the Debtor's
continued use of cash collateral securing obligations to its
lenders. The Debtor's authority to use the cash collateral
expires that day, absent an extension.
An official committee of unsecured creditors has been appointed in
the case. The committee is represented by:
Joshua T. Klein, Esq.
FOX ROTHSCHILD LLP
2000 Market Street, 20th Floor
Philadelphia, PA 19103-3291
Tel: 215-299-2000
E-mail: jklein@foxrothschild.com
- and -
Michael J. Viscount, Jr., Esq.
FOX ROTHSCHILD, LLP
1301 Atlantic Avenue, Suite 400
Midtown Building
Atlantic City, NJ 08401
Tel: (609) 572-2227
E-mail: mviscount@foxrothschild.com
About 15-35 Hempstead Properties
15-35 Hempstead Properties, LLC, owns real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on
Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi &
Astin, assists 15-35 Hempstead in its restructuring effort.
15-35 Hempstead estimated its assets and debts at $10 million to
$50 million.
Affiliate Jackson 299 Hempstead, LLC, filed a separate Chapter 11
petition (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010.
Jackson 299 Hempstead, LLC, owns a parcel of real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43180) on Oct.
26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin,
assists Jackson 299 in its restructuring effort. Jackson 299
estimated its assets and debts at $10 million to $50 million.
The cases are jointly administered under 15-35 Hempstead
Properties, LLC.
15-35 HEMPSTEAD: Taps Saligman-Decker as Property Manager
---------------------------------------------------------
15-35 Hempstead Properties, LLC, obtained permission from the
Bankruptcy Court to employ Saligman-Decker Associates, LLC, as its
property managers.
In its application, the Debtor said it needs a manager to manage
its property by collecting rents, preparing an annual budget,
overseeing maintenance of the property, overseeing the acquisition
of insurance, keeping property records, preparing records and
overseeing landlord-tenant issues.
The firm will be paid 5% of gross receipts per annum with a
minimum fee of $10,000 per month.
The firm attests that it has no connection with the Debtor, or any
other parties in interest, and is a "disinterested person" within
the meaning of Section 101(14) of the Bankruptcy Code.
About 15-35 Hempstead Properties
15-35 Hempstead Properties, LLC, owns real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43178) on
Oct. 26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi &
Astin, assists 15-35 Hempstead in its restructuring effort.
15-35 Hempstead estimated its assets and debts at $10 million to
$50 million.
Affiliate Jackson 299 Hempstead, LLC, filed a separate Chapter 11
petition (Bankr. D. N.J. Case No. 10-43180) on Oct. 26, 2010.
Jackson 299 Hempstead, LLC, owns a parcel of real property at 101
Boardwalk in Atlantic City, New Jersey. It filed for Chapter 11
bankruptcy protection (Bankr. D. N.J. Case No. 10-43180) on Oct.
26, 2010. Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin,
assists Jackson 299 in its restructuring effort. Jackson 299
estimated its assets and debts at $10 million to $50 million.
The cases are jointly administered under 15-35 Hempstead
Properties, LLC.
1744 PROPERTIES: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: 1744 Properties LLC
1744 M Street
Lincoln, NE 68508
Bankruptcy Case No.: 11-40641
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
District of Nebraska (Lincoln Office)
Debtor's Counsel: David P. Thompson, Esq.
THOMPSON LAW
Windsor Place
330 South 10th Street, Suite 220
Lincoln, NE 68508
Tel: (402) 474-0374
Fax: (402) 474-0375
E-mail: thompsonlaw@windstream.net
Estimated Assets: $1,000,001 to $10,000,000
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 Michael D. Raasch, manager.
610-630 E.: Case Summary & Largest Unsecured Creditor
-----------------------------------------------------
Debtor: 610-630 E. 8th Street, LLC
610-630 E. 8th Street
Los Angeles, CA 90014
Bankruptcy Case No.: 11-20430
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
Central District Of California (Los Angeles)
Judge: Richard M. Neiter
Debtor's Counsel: Jennifer L. Jones, Esq.
THE WESTWOOD LAW GROUP, APC
3335 Keystone Ave #5
Los Angeles, CA 90034
Tel: (619) 913-9818
Fax: (619) 913-9818
E-mail: jdgrad03@yahoo.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The list of 20 largest unsecured creditors contains only one
entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Los Angeles County Tax 2009 & 2010 $20,000
Collector Property Taxes
225 North Hill Street
Los Angeles, CA 90012
The petition was signed by Javid Somekh, managing member.
A-111 VENTURE: Case Summary & 3 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: A-111 Venture LLC
P.O. Box 206
Pacific, WA 98047
Bankruptcy Case No.: 11-41820
Chapter 11 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
Western District of Washington (Tacoma)
Judge: Paul B. Snyder
Debtor's Counsel: Allan L. Overland, Esq.
ALLAN OVERLAND LAW FIRM
901 South I Street, Suite 202
Tacoma, WA 98405
Tel: (253) 383-3053
Fax: (253) 383-3209
Scheduled Assets: $340,000
Scheduled Debts: $2,138,289
A list of the Company's three largest unsecured creditors filed
together with the petition is available for free at:
http://bankrupt.com/misc/wawb11-41820.pdf
The petition was signed by Scott M. Haymond, member.
A-2 VENTURE: Case Summary & 2 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: A-2 Venture LLC
P.O. Box 206
Pacific, WA 98047
Bankruptcy Case No.: 11-41821
Chapter 11 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
Western District of Washington (Tacoma)
Judge: Brian D. Lynch
Debtor's Counsel: Allan L. Overland, Esq.
ALLAN OVERLAND LAW FIRM
901 South I Street, Suite 202
Tacoma, WA 98405
Tel: (253) 383-3053
Fax: (253) 383-3209
Scheduled Assets: $1,700,000
Scheduled Debts: $5,303,219
A list of the Company's two largest unsecured creditors filed
together with the petition is available for free at:
http://bankrupt.com/misc/wawb11-41821.pdf
The petition was signed by Scott M. Haymond, member.
ACTION ENERGY: Completes Cavalon Deal & Cuts Debt by C1.88MM
------------------------------------------------------------
Action Energy Inc. on March 3 said it has completed the
acquisition of Cavalon Capital Partners Inc. and has reduced its
secured indebtedness by approximately C$1.88 million as
contemplated by the Financial Support and Forbearance Agreement
entered into by Action with Cavalon, its secured lender, and
announced on Feb. 18, 2011.
Action completed the acquisition of all of the issued and
outstanding shares of Cavalon for a purchase price of C$1,713,440.
Upon closing, the assets of Cavalon consisted of an interest in a
non-operated oil and gas property located in the area of Clive,
Alberta, and secured indebtedness of Action to Cavalon in an
amount equal to the purchase price for the Cavalon Shares.
Cavalon reduced the outstanding balance of the secured
indebtedness by the amount of the purchase price and by an
additional C$168,100 to be paid to an arm's length third party and
assigned the balance of approximately C$865,064 and related
security to Cavalon Capital Corp. In connection with the
assignment of the remaining secured debt, Cavalon Corp. agreed to
forbear in the enforcement of the security, to terminate the
accrual of interest on the debt and to provide Action with ongoing
financial support as Action undertakes the reorganization and
revitalization of its business and affairs. The acquisition of
the Cavalon Shares and the repayment of indebtedness was completed
using funds received from Action's participation in a
restructuring involving a group of labor and management service
companies which was completed March 1, 2011.
The acquisition of Cavalon was a related party transaction within
the meaning of applicable Canadian securities laws as the
shareholders of Cavalon were Greg Matthews, a director of Action,
and the spouse of David Tonken, a director and officer of Action.
The board of directors (excluding Messrs. Tonken and Matthews)
approved the acquisition on the basis that it was necessary to
reduce Action's secured indebtedness, obtain continued forbearance
in relation to the remaining secured debt and to enable Action to
continue efforts to reorganize its business and affairs.
Additional information relating to exemptions from the valuation
and minority approval requirements applicable to related party
transactions is contained in a material change report to be filed
in accordance with applicable Canadian securities laws. The
acquisition of Cavalon was completed in fewer than 21 days from
the announcement of the Support Agreement to coordinate with the
closing of the LMS Transaction and to enable Action to proceed
expeditiously with efforts to reorganize its affairs.
Calgary, Alberta-based Action Energy Inc. (NEX:AEC.H) is an oil
and gas company engaged in production and exploration activities.
AEGIS-EL MONTE: Case Summary & 6 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Aegis-El Monte Realty LP
2331 W Lincoln Ave
Anaheim, CA 92801
Bankruptcy Case No.: 11-13373
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
Central District Of California (Santa Ana)
Judge: Robert N. Kwan
Debtor's Counsel: Kenneth J. Catanzarite, Esq.
CATANZARITE LAW CORPORATION
2331 W. Lincoln Ave.
Anaheim, CA 92801
Tel: (714) 520-5544
Fax: (714) 520-0680
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
A list of the Company's six largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/cacb11-13373.pdf
The petition was signed by Kenneth J. Catanzarite, president of
general partner.
ALABAMA AIRCRAFT: Seeks to Cut Wages, Throw Out Contract
--------------------------------------------------------
Dow Jones' DBR Small Cap reports that Alabama Aircraft Industries
Inc. is asking a Delaware bankruptcy judge to let it reject a
collective-bargaining agreement with its workers so it can cut
wages by 15% and take the first steps toward terminating the
Company's pension plan.
According to the report, the measure, executives said in court
documents, would help keep the Company from going out of business.
"The underlying cause of these problems is a demographic problem
that is all too familiar to industrial America: the Pension Plan
has more than 2,800 participants and the [company employs]
approximately 325 active workers to support it," the Company said
in court documents filed with the U.S. Bankruptcy Court in
Wilmington, Del., the report notes.
About Alabama Aircraft
Alabama Aircraft Industries Inc. --
http://www.alabamaaircraft.com/-- provides aircraft maintenance
and modification services for the U.S. government and military
customers. Its 190-acre facility, including its corporate
offices, is located at the Birmingham International Airport in
Birmingham, Alabama. The Company currently has 92 salaried
employees and 234 hourly employees. About 251 hourly employees
were furloughed since Jan. 1, 2010.
Alabama Aircraft Industries, Inc., filed for Chapter 11 bankruptcy
protection (Bankr. D. Del. Case No. 11-10452) on Feb. 15, 2011.
Two subsidiaries also filed -- Alabama Aircraft Industries, Inc.-
Birmingham (Case No. 11-10453) and Pemco Aircraft Engineering
Services, Inc. (Case No. 11-10454).
The Company said that the primary goal of the Chapter 11 filing is
to address long-term indebtedness and, in particular, long-term
pension obligations under the terms of its pension plan.
The Company said it would likely cease operations by April 15,
2011, absent the elimination of its obligations under the pension
plan. The Company owes $68.5 million to the Pension Benefit
Guaranty Corp.
Joel A. Waite, Esq., and Kenneth J. Enos, Esq., at Young, Conaway,
Stargatt & Taylor, in Wilmington, Delaware, serve as counsel to
the Debtors.
Alabama Aircraft estimated assets and debts of $1 million to
$10 million as of the Chapter 11 filing.
ALEKSANDRA OSTOJIN-ROVCANIN: N.J. Ct. Rules on Betal Lawsuit
------------------------------------------------------------
Betal Enterprises, Inc., appeal from summary judgment dismissal by
the Law Division of their legal malpractice complaint against
Hedinger & Lawless, LLC. The Betal parties argue there was, at a
minimum, a genuine issue of material fact as to whether an
attorney-client relationship existed that would withstand summary
judgment. Hedinger cross-appeals, arguing that even if the Betal
parties are correct, summary judgment is still appropriate because
of the Betal parties' inability to establish a prima facie case of
legal malpractice. Judges Francine Axelrad and Jonathan N. Harris
of the Superior Court of New Jersey, Appellate Division, affirmed
the grant of summary judgment based on Hedinger's cross-appeal.
On Jan. 10, 2006, Hedinger filed a complaint against the Betal
parties to recover legal fees for services rendered. A default
judgment was entered, which was vacated by order of Oct. 27, 2006.
On Sept. 26, 2006, the Betal parties filed a complaint against
Hedinger for legal malpractice, alleging negligent representation
in a surety action. At some point the cases were consolidated.
Hedinger moved for summary judgment, which was granted March 19,
2010 following oral argument, and the Betal parties' malpractice
claim was dismissed with prejudice. Based on the Betal parties'
non-appearance at trial on April 19, 2010, and the submission of
an affidavit of amount due, the court entered default judgment
against the Betal parties in the fee action on May 7, 2010, in the
amount of $45,300.96. The Betal parties appealed and Hedinger
filed a protective cross-appeal, claiming, in the event the Betal
parties were successful on appeal, summary judgment should have
been granted on alternate grounds.
Betal Enterprises is a defunct construction and demolition
business that stopped operating sometime in 2004. It performed
asbestos removal, lead abatement, and mold remediation.
The cases are HEDINGER & LAWLESS, LLC, Plaintiff, v. BETAL
ENTERPRISES, INC., a/k/a BETAL ENVIRONMENTAL, CORP., a/k/a BETAL
ENVIRONMENTAL INC., BRANKO ROVCANIN and ALEKSANDRA OSTOJIN,
Defendants; and BETAL ENTERPRISES, INC., BETAL ENVIRONMENTAL,
CORP., BETAL ENVIRONMENTAL, INC., BRANKO ROVCANIN and ALEKSANDRA
OSTOJIN, Plaintiffs-Appellants/Cross-Respondents, v. HEDINGER &
LAWLESS, LLC, Defendant-Respondent/Cross-Appellant, and TOWNSHIP
OF LITTLE FALLS, A&A CONSTRUCTION AND MANAGEMENT CONSULTANTS,
INC., SIMON, INC., NORTHEAST BUILDERS OF AMERICA, INC., J.I.L.
TRANSPORT, LLC, BLEEKER ARCHITECTURAL GROUP, LLC, BOROUGH OF EAST
RUTHERFORD, H&B ARCHITECTS AND ENGINEERS, MASON TECH, LLC, GMS
CONSTRUCTION, INC., AMERICAN APPLICATION SYSTEMS, INC., TOWNSHIP
OF INDEPENDENCE, CAM DESIGN GROUP ARCHITECTS, STE PAINTING, NORTH
HUDSON COMMUNITY ACTION CORPORATION, RIVARDO SCHNITZER CAPAZZI,
AIA, MAINO ELECTRIC INC., BOROUGH OF BUTLER, DICARA RUBINO
ARCHITECTS, LORENZO ELECTRICAL CONTRACTORS, TOWNSHIP OF SANDYSTON,
WESTVIEW CONTRACTING, INC., FIRST JERSEY EXTERIOR, UNITED
BROTHERHOOD OF CARPENTERS LOCAL 124, and ALLEN FROST, II,
Defendants, No. A-4797-09T3 (N.J. Super. Ct.).
A copy of the Superior Court's March 10, 2011 ruling is available
at http://is.gd/vIcyDDfrom Leagle.com.
About Aleksandra Ostojin-Rovcanin
Aleksandra Ostojin-Rovcanin, a resident of Wayne, New Jersey,
filed for Chapter 11 bankruptcy (Bankr. D. N.J. Case No. 06-14136)
on May 11, 2006, represented by Stuart D. Gavzy, Esq., in Little
Falls, New Jersey. In her petition, Ms. Ostojin-Rovcanin
disclosed assets between $1 million and $10 million.
ALTON SQUARE: Goes Into Receivership Following Foreclosure Suit
---------------------------------------------------------------
Sanford J. Schmidt at The Telegraph reports that Alton Square
Mall, in Alton, Illinois, is in receivership and under the
direction of a St. Louis company as a result of a foreclosure
lawsuit filed by a lending institution. The report relates that
an unnamed spokeswoman said shoppers should not expect any changes
in the way the mall is operated.
Under the terms of an agreement as the foreclosure suit is
pending, according to The Telegraph, the receiver is to operate
the mall to keep it maintained and to ensure that routine business
continues, according to court documents.
The owners, Coyote Alton Mall, have agreed to the receivership
while the suit goes forward, the report notes. Property owners in
foreclosure may be able to redeem the loan and have the case
dismissed, The Telegraph discloses.
The lender, Marquette Capital Realty, claims in its suit that the
owners borrowed about US$26.2 million when they bought the mall in
August 2007, the report recounts.
The Telegraph says that the owners were in default on the regular
payments as of Aug. 4, 2010. The report relates that the owners
still owed about $13 million in principal, plus fees and expenses.
Coyote bought the 32-year-old mall from Simon Property Group of
Indianapolis, the report notes. The sale did not include the
restaurants or the Sears buildings, the report adds.
Alton Square Mall is being operated by Cassidy, Turley, Midwest, a
commercial real estate firm. Alton Square Mall is a 630,000
square-foot regional center anchored by Macy's, Sears, JCPenney,
and 60 other shops and restaurants.
ANCHOR BLUE: Gets Nod to Tap Streambank as IP Sale Consultant
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has granted
Anchor Blue Holding Corp., et al., permission to employ
Streambank, LLC, as the Debtors' intellectual property disposition
consultant, nunc pro tunc to Jan. 31, 2011.
Streambank will be compensated in accordance with the terms of the
Retention Letter without the necessity of Streambank filing
interim and final fee applications or otherwise complying with the
monthly, quarterly or final compensation procedures applicable to
professionals.
The Debtors have agreed to pay Streambank a commission equal to a
percentage of the aggregate gross proceeds paid to the Debtors for
the sale or assignment of the Intellectual Property.
To the best of the Debtors' knowledge, Streambank is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code, and Streambank does not hold or represent
any interest adverse to the Debtors' estates.
About Anchor Blue
Anchor Blue is a specialty retailer of casual apparel and
accessories for the teenage market. Founded in 1972, the Company
has 117 stores located in nine western and southwestern states:
Arizona, California, Colorado, New Mexico, Oregon, Texas, Utah and
Washington. The Company employs 1,400 full and part-time
employees in their stores and their corporate headquarters in
Corona, California. Anchor Blue is an indirect affiliate of Sun
Capital Partners, a Florida-based investment firm.
Anchor Blue Holding Corp., together with Anchor Blue Inc., filed
for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No.
11-10110) on Jan. 11, 2011. As of Jan. 1, 2011, the Debtors'
books and records reflected total combined assets of roughly
$24.7 million (book value) and total combined liabilities of
roughly $38.5 million.
Neil Herman, Esq., and Rachel Mauceri, Esq., at Morgan Lewis, in
Philadelphia, Pennsylvania, serve as counsel to the Debtors. Epiq
Bankruptcy Solutions, LLC, is the claims and notice agent. The
Official Committee of Unsecured Creditors is represented by
Eric R. Wilson, Esq., at Kelley Drye & Warren LLP, in New York.
The prepetition first lien lender is represented by Julia Frost-
Davies, Esq., at Bingham McCutchen LLP, in Boston, Massachusetts,
and Regina Stango Kelbon, Esq., at Blank Rome LLP, in
Philadelphia, Pennsylvania. The prepetition second lien lenders
are represented by Thomas E. Patterson, Esq., at Klee, Tuchin,
Bogdanoff & Stern LLP, in Los Angeles, California. The Debtors'
prepetition subordinated lender is represented by James Stempel,
Esq., at Kirkland & Ellis LLP, in Chicago, Illinois.
ANCHOR BLUE: Can Hire Hilco Real Estate as Real Estate Consultant
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has granted
Anchor Blue Holding Corp., et al., authority to employ Hilco Real
Estate, LLC, as real estate consultant, nunc pro tunc to Jan. 13,
2011.
The Debtors are authorized to pay Hilco 100% of the amount due
upon submission of its invoices to the Debtors, subject to the
parties' rights to seek a resolution in the Court in the event of
a dispute.
Hilco will advise and assist in identifying any value in the
leases pertaining to all their retail locations, marketing,
negotiating potential extensions of time to assume or reject the
leases, as needed, and ultimately disposing (through termination,
rejection or assumption and assignment) of the leases.
To the best of the Debtors' knowledge, the officers and employees
of Hilco do not have any connection with the creditors or any
other party in interest, are "disinterested persons" as that
phrase is defined under Section 101(14) of the Bankruptcy Code,
and do not hold or represent an interest adverse to the Debtors'
estates.
For their professional services, Hilco will bill:
a) Disposition Fees. To the extent that a leased property is
sold, assigned, subleased, terminated or otherwise disposed
of, Hilco will earn a fee, upon disposition, equal to 5% of
the gross cash value received by the estates.
b) Expenses. Hilo will be entitled to reimbursement from the
Debtors for all reasonable and necessary out of pocket
expenses not to exceed $10,000.
Abut Anchor Blue
Anchor Blue is a specialty retailer of casual apparel and
accessories for the teenage market. Founded in 1972, the Company
has 117 stores located in nine western and southwestern states:
Arizona, California, Colorado, New Mexico, Oregon, Texas, Utah and
Washington. The Company employs 1,400 full and part-time
employees in their stores and their corporate headquarters in
Corona, California. Anchor Blue is an indirect affiliate of Sun
Capital Partners, a Florida-based investment firm.
Anchor Blue Holding Corp., together with Anchor Blue Inc., filed
for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No.
11-10110) on Jan. 11, 2011. As of Jan. 1, 2011, the Debtors'
books and records reflected total combined assets of roughly
$24.7 million (book value) and total combined liabilities of
roughly $38.5 million.
Neil Herman, Esq., and Rachel Mauceri, Esq., at Morgan Lewis, in
Philadelphia, Pennsylvania, serve as counsel to the Debtors.
Epiq Bankruptcy Solutions, LLC, is the claims and notice agent.
The Official Committee of Unsecured Creditors is represented by
Eric R. Wilson, Esq., at Kelley Drye & Warren LLP, in New York.
The prepetition first lien lender is represented by Julia Frost-
Davies, Esq., at Bingham McCutchen LLP, in Boston, Massachusetts,
and Regina Stango Kelbon, Esq., at Blank Rome LLP, in
Philadelphia, Pennsylvania. The prepetition second lien lenders
are represented by Thomas E. Patterson, Esq., at Klee, Tuchin,
Bogdanoff & Stern LLP, in Los Angeles, California. The Debtors'
prepetition subordinated lender is represented by James Stempel,
Esq., at Kirkland & Ellis LLP, in Chicago, Illinois.
APPLIED DNA: Incurs $1.34-Mil. Net Loss in Dec. 31 Quarter
----------------------------------------------------------
Applied DNA Sciences, Inc., filed its quarterly report on Form 10-
Q, reporting a net loss of $1.34 million on $317,817 of revenue
for the three months ended Dec. 31, 2010, compared with a net loss
of $1.80 million on $72,715 of revenue for the same period during
the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $1.77 million
in total assets, $3.57 million in total liabilities and a
stockholders' deficit of $1.80 million. The Company has an
accumulated deficit of $152.68 million as of Dec. 31, 2010.
A full-text copy of the Form 10-Q filed with the U.S. Securities
and Exchange Commission is available for free at:
http://ResearchArchives.com/t/s?74ff
Going Concern Doubt
As reported in the Troubled Company Reporter on Dec. 21, 2010,
RBSM LLP, in New York, expressed substantial doubt about Applied
DNA Sciences' ability to continue as a going concern, after
auditing the Company's financial statements for fiscal year ended
Sept. 30, 2010. The independent auditors noted that the Company
has suffered recurring losses and does not have significant cash
or other material assets, nor does it have an established source
of revenues sufficient to cover its operations.
The Company reported a net loss of $7.91 million on $519,844 of
sales for fiscal 2010, compared with net income of $3.94 million
on $295,162 of sales for fiscal 2009.
About Applied DNA
Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally
devoted to developing DNA embedded biotechnology security
solutions in the United States.
BERNARD L MADOFF: Trustee Wins Approval of Hadassah Settlement
--------------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
Women's Zionist Organization of America Inc., better known as
Hadassah, was given a 42% discount in agreeing to a $45 million
settlement with the trustee for Bernard L. Madoff Investment
Securities Inc. The settlement was approved last week by the
bankruptcy judge in New York.
According to Mr. Rochelle, Hadassah and its sister organization
Hadassah Medical Relief Association Inc. had accounts with Madoff
since 1988. Over the years, they took out $77 million in
fictitious profits, according to the Madoff trustee's court
filing. The trustee agreed to let Hadassah off the hook in return
for paying $45 million.
Rather than being sued, Hadassah agreed to an extension of the
time for the trustee to file a lawsuit. Hadassah made financial
disclosure to the trustee, who said in his court filing that the
organization didn't have enough assets and "free cash" both to pay
a judgment and "continue to meet its charitable mission
domestically and abroad."
The trustee noted that Hadassah is beginning a $363 million
hospital-building project in Israel.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
As of Feb. 18, 2011, a total of US$6.85 billion in claims by
investors has been allowed, with US$791.1 million to be paid by
the Securities Investor Protection Corp. Investors are expected
to receive additional distributions from money recovered by
Mr. Picard from lawsuits or settlements.
BERNARD L MADOFF: Court to Rule on Release of Employees' Names
--------------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
several major financial institutions are opposing requests by
media for disclosure of the identities of employees mentioned in
complaints filed by the Madoff trustee.
In February, the New York Times and several television outlets of
NBC Universal LLC petitioned the bankruptcy judge to unseal the
remainder of the Madoff trustee's complaints against financial
institutions. Previously, the complaints filed in December were
unsealed except for the names of people who worked for the
defendant banks.
The bankruptcy judge told the banks to submit statements last week
setting out their positions on revealing the identities of their
personnel whose names appear in the complaints.
Citibank NA, UBS AG, and Natixis urge the judge to keep their
employees' identities secret. Citibank said the names "will add
nothing material to the public's understanding of this action."
UBS believes the names are "of virtually no importance to the
judicial process." UBS contends that disclosing names will expose
the individuals to "harassment, threats, stigmatization, or
worse."
Paris-based Natixis is concerned with the consequences of
disclosure of names to the French press. It says "the French
public is even more likely to believe that the Natixis employees
participated in fraudulent activity."
Reliance International Research LLC wants to maintain secrecy
about "the identity of one of its owners."
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
As of Feb. 18, 2011, a total of US$6.85 billion in claims by
investors has been allowed, with US$791.1 million to be paid by
the Securities Investor Protection Corp. Investors are expected
to receive additional distributions from money recovered by
Mr. Picard from lawsuits or settlements.
BLOCKBUSTER INC: Warner Bro.'s Wants Immediate Payment of Debt
--------------------------------------------------------------
Warner Home Video, a division of Warner Bros. Home Entertainment
Inc., asks the Bankruptcy Court to (i) compel immediate payment of
its administrative expense Claim pursuant to Sections 105(a),
363(b) and 503(b) of the Bankruptcy Code or, in the alternative,
(ii) grant relief from automatic stay pursuant to Section 362(d)
of the Bankruptcy Code to permit reclamation of its goods.
WHV, a principal supplier of filmed entertainment products to the
Debtors, entered into an agreement to supply products under
extended payment terms, Larry D. Henin, Esq., at Edwards Angell
Palmer & Dodge LLP, in New York -- lhenin@eapdlaw.com -- informs
the Court. Under the terms of the Supply Agreement, the Debtors
agreed to pay certain "Up Front Fees" and, within an extended
payment term of 90 days, a "Minimum Guaranty" recoupable against
WHV's portion of the revenues generated by the Debtors in their
use of the associated WHV product. Generally this has resulted,
after the Minimum Guaranty has been recouped, in WHV being owed
"overages," which the Debtors are required to pay to WHV in
accordance with the terms of the agreement, he explains.
While WHV has fully performed under the Supply Agreement, the
Debtors have not, Mr. Henin contends. He discloses that on
Jan. 25, 2011, the Debtors, apparently at the behest of their
lenders, verbally informed WHV that the Debtors are not able to
pay the amounts owed to WHV under the Supply Agreement.
Concurrently, the Debtors abandoned their reorganization efforts
and consented to a liquidation sale of their assets. Mr. Henin
notes that notwithstanding the DIP Order, none of the $125 million
in revolving credit is presently owed by the Debtors, and instead,
that line of credit has been terminated by the Debtors' lenders at
no loss to themselves and after reaping the gain of millions of
dollars in fees.
In short, the Debtors or perhaps more accurately their lenders
have decided to "pull the plug" on these cases, despite earlier
assurances to WHV, other creditors, and the Court, to the
contrary, Mr. Henin argues. He points out that the effect on WHV
has been profoundly prejudicial, and while it is true that the
Debtors paid WHV's prepetition claims, the net effect of WHV's
entering into the Supply Agreement has been to greatly increase
its exposure, from approximately $14 million prior to the Petition
Date to $20,472,526, as of Feb. 1, 2011, of which $3,237,491 is
past due.
Mr. Henin asserts that the amount of the WHV Claim may be expected
to change over time. He says that the Claim does not include
overages arising during the current calendar year that have not
yet been reported to WHV, and which may not yet be due, under the
terms of the Supply Agreement. Accordingly, WHV reserves its
right to amend the amount of the WHV Claim.
WHV is crucial to the Debtors' ability to operate and, by entering
into and performing under the Supply Agreement, WHV has
contributed substantial value to the bankruptcy estates, to the
benefit of the Debtors and their lenders, but to its own
substantial detriment, Mr. Henin contends. Hence, WHV asks the
Court to require the Debtors to pay WHV's undisputed
administrative expenses, rather than permit the Debtors and their
lenders to finance an orderly liquidation on the involuntary backs
of WHV and similarly situated administrative creditors.
The Court will convene a hearing on April 21, 2011, to consider
the request. Objections are due on April 15.
About Blockbuster Inc.
Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA,
BLOKB) -- http://www.blockbuster.com/-- is a global provider of
rental and retail movie and game entertainment. It has a library
of more than 125,000 movie and game titles.
Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11
bankruptcy proceedings with a pre-arranged reorganization plan
in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23,
2010. It disclosed assets of $1 billion and debts of $1.4 billion
at the time of the filing.
Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil,
Gotshal & Manges, serve as counsel to the Debtors. Rothschild
Inc. is the financial advisor. Alvarez & Marsal is the
restructuring advisor with A&M managing director Jeffery J.
Stegenga as chief restructuring officer. Kurtzman Carson
Consultants LLC is the claims and notice agent.
A steering group of senior secured noteholders is represented by
James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin
LLP. U.S. Bank National Association as trustee and collateral
agent for the senior secured notes is represented by David
McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter
& Hampton LLP. BDO Consulting is the financial advisor for U.S.
Bank.
Lenders led by Wilmington Trust FSB are providing the DIP
financing. The DIP Agent is represented by Peter Neckles, Esq.
and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York.
The Official Committee of Unsecured Creditors has retained Cooley
LLP as its counsel.
Blockbuster's non-U.S. operations and its domestic and
international franchisees, all of which are legally separate
entities, were not included in the filings and are not parties to
the Chapter 11 proceedings.
In its latest monthly operating report filed with the
Bankruptcy Court, Blockbuster disclosed $1.066 billion in
assets, $422.2 million in liabilities not subject to compromise
and $1.165 billion in liabilities subject to compromise, and a
deficit of $533.8 million as of Nov. 28, 2010.
BLOCKBUSTER INC: Sony Wants Assurance of Payment from DVD Sales
---------------------------------------------------------------
Sony Pictures Home Entertainment Inc. asks the U.S. Bankruptcy
Court to order Blockbuster Inc. to provide adequate protection on
SPHE's personal property that is subject to an unexpired lease,
or, alternatively, grant SPHE relief from the automatic stay to
permit reclamation of its goods.
Pamela K. Webster, Esq., at Buchalter Nemer, in Los Angeles,
California -- pwebster@buchalter.com -- contends that the request
is brought by SPHE because of the steeply declining value of DVDs
of SPHE's movie titles leased to Blockbuster, Inc., pursuant to
the parties' Fifth Revenue Sharing Agreement, effective as of June
1, 2009, as amended.
Pursuant to the RSA, SPHE leases its DVD titles to Blockbuster,
which in turn rents those leased DVDs to consumers and sells some
of the used ones as authorized. SPHE and Blockbuster share the
revenue generated by consumer rentals and sales during each
title's lease period.
Because of the nature of the industry and the rental properties at
issue, SPHE's property becomes significantly less valuable over
the duration of each title's lease period, Ms. Webster contends.
She asserts that a substantially greater portion of revenue is
generated by the leased DVDs closer to the "street date" when a
title is first made available to the public. She notes that the
value of a given DVD title declines from its street date and each
week thereafter.
In his affidavit supporting the request, Michael Schillo, SPHE's
vice president for Credit and Customer Finance, relates that until
late January 2011, SPHE and Blockbuster continued their business
relationship unchanged, with SPHE leasing DVDs to Blockbuster, and
Blockbuster renting those DVDs to consumers and paying to SPHE the
share of revenue to which SPHE is entitled. However, in late
January 2011, Blockbuster informed SPHE that, as purportedly
instructed by its DIP lenders, Blockbuster would not be turning
over more than $24 million in revenue due or coming due to SPHE
pursuant to the RSA.
Ms. Webster argues that the leased DVD titles will generate more
than $5.5 million over the next several months. "Blockbuster's
latest actions indicate that there is at least a significant risk,
if not a complete certainty, that Blockbuster will not turn over
the revenue to SPHE," she points out.
Hence, SPHE seeks an order from the Court for adequate protection
of its property, including a requirement that Blockbuster
sequester funds generated by the rental and sales of SPHE's leased
DVDs to pay SPHE its share of the revenue.
A hearing will be held on March 17, 2011, to consider the request.
Objections are due on March 10.
About Blockbuster Inc.
Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA,
BLOKB) -- http://www.blockbuster.com/-- is a global provider of
rental and retail movie and game entertainment. It has a library
of more than 125,000 movie and game titles.
Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11
bankruptcy proceedings with a pre-arranged reorganization plan
in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23,
2010. It disclosed assets of $1 billion and debts of $1.4 billion
at the time of the filing.
Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil,
Gotshal & Manges, serve as counsel to the Debtors. Rothschild
Inc. is the financial advisor. Alvarez & Marsal is the
restructuring advisor with A&M managing director Jeffery J.
Stegenga as chief restructuring officer. Kurtzman Carson
Consultants LLC is the claims and notice agent.
A steering group of senior secured noteholders is represented by
James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin
LLP. U.S. Bank National Association as trustee and collateral
agent for the senior secured notes is represented by David
McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter
& Hampton LLP. BDO Consulting is the financial advisor for U.S.
Bank.
Lenders led by Wilmington Trust FSB are providing the DIP
financing. The DIP Agent is represented by Peter Neckles, Esq.
and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York.
The Official Committee of Unsecured Creditors has retained Cooley
LLP as its counsel.
Blockbuster's non-U.S. operations and its domestic and
international franchisees, all of which are legally separate
entities, were not included in the filings and are not parties to
the Chapter 11 proceedings.
In its latest monthly operating report filed with the
Bankruptcy Court, Blockbuster disclosed $1.066 billion in
assets, $422.2 million in liabilities not subject to compromise
and $1.165 billion in liabilities subject to compromise, and a
deficit of $533.8 million as of Nov. 28, 2010.
BLOCKBUSTER INC: Allows Donaldson Case to Proceed on Appeal
-----------------------------------------------------------
Blockbuster Inc., Carolee Donaldson and Paul Wortman entered into
a Bankruptcy court-approved stipulation to agree to the conditions
relating to the modification of the automatic stay in resolution
of the request.
Prepetition, Ms. Donaldson and Mr. Wortman commenced an action
alleging personal injuries from a slip and fall accident in one of
the Debtors' stores. On May 20, 2009, the jury in the State Court
Litigation issued its verdict, awarding her $406,137. Blockbuster
subsequently filed a notice of appeal of the Judgment. On June
25, 2009, Blockbuster Inc. filed a supersedeas bond with the Trial
Court in the amount of $673,789 as a condition of the Appeal, with
Travelers Casualty and Surety Company as surety on the Supersedeas
Bond.
Under their stipulation, the parties agree that the automatic stay
will be modified so that the Appellate Court may schedule and
conduct oral argument in the Appeal, and may issue in the Appeal
its orders, decision, judgment, remittitur, and mandate as
otherwise provided by law without regard to the Stay.
The Plaintiffs may enforce and execute upon the Final Judgment,
against Travelers under the Supersedeas Bond, to the extent the
enforcement or execution (a) is consistent with the terms,
conditions and limitations of the stipulation, and (b) is
consistent with the terms, conditions and limitations of the
Supersedeas Bond.
Except as expressly set forth in the stipulation, the Plaintiffs
will not take any action outside the Bankruptcy Court to collect
any amount from Blockbuster, the other Debtors or their
properties.
To the extent not otherwise satisfied, the Plaintiffs may assert
any prepetition claim against Blockbuster arising from the
Judgment or the Final Judgment solely by filing by the applicable
bar date a proof of claim in the Bankruptcy Court evidencing
Blockbuster's asserted indebtedness to the Plaintiffs.
The parties further agree that the Appellate Court will have
exclusive jurisdiction over them with respect to any matters
related to or arising in the Appeal. The Trial Court will have
exclusive jurisdiction over the parties and Travelers with respect
to any matters related to or arising in connection with
enforcement of the Final Judgment against Travelers under the
Supersedeas Bond. The Court will retain jurisdiction over the
parties with respect to any other matters related to or arising
from the request or the implementation of the stipulation.
About Blockbuster Inc.
Based in Dallas, Texas, Blockbuster Inc. (Pink Sheets: BLOKA,
BLOKB) -- http://www.blockbuster.com/-- is a global provider of
rental and retail movie and game entertainment. It has a library
of more than 125,000 movie and game titles.
Blockbuster Inc. and 12 U.S. affiliates initiated Chapter 11
bankruptcy proceedings with a pre-arranged reorganization plan
in Manhattan (Bankr. S.D.N.Y. Case No. 10-14997) on Sept. 23,
2010. It disclosed assets of $1 billion and debts of $1.4 billion
at the time of the filing.
Martin A Sosland, Esq., and Stephen Karotkin, Esq., at Weil,
Gotshal & Manges, serve as counsel to the Debtors. Rothschild
Inc. is the financial advisor. Alvarez & Marsal is the
restructuring advisor with A&M managing director Jeffery J.
Stegenga as chief restructuring officer. Kurtzman Carson
Consultants LLC is the claims and notice agent.
A steering group of senior secured noteholders is represented by
James P. Seery, Esq., and Paul S. Caruso, Esq., at Sidley Austin
LLP. U.S. Bank National Association as trustee and collateral
agent for the senior secured notes is represented by David
McCarty, Esq., and Kyle Mathews, Esq., at Sheppard Mullin Richter
& Hampton LLP. BDO Consulting is the financial advisor for U.S.
Bank.
Lenders led by Wilmington Trust FSB are providing the DIP
financing. The DIP Agent is represented by Peter Neckles, Esq.
and Alexandra Margolis, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York.
The Official Committee of Unsecured Creditors has retained Cooley
LLP as its counsel.
Blockbuster's non-U.S. operations and its domestic and
international franchisees, all of which are legally separate
entities, were not included in the filings and are not parties to
the Chapter 11 proceedings.
In its latest monthly operating report filed with the
Bankruptcy Court, Blockbuster disclosed $1.066 billion in
assets, $422.2 million in liabilities not subject to compromise
and $1.165 billion in liabilities subject to compromise, and a
deficit of $533.8 million as of Nov. 28, 2010.
Bankruptcy Creditors' Service, Inc., publishes BLOCKBUSTER
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by Blockbuster Inc. and its units.
(http://bankrupt.com/newsstand/or 215/945-7000)
BOART LONGYEAR: Moody's Assigns 'Ba2' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service assigned Ba2 corporate family and
probability of default ratings to Boart Longyear Limited. At
the same time, Moody's assigned a Ba2 rating to the company's
$250 million of senior unsecured notes and an SGL-2 speculative
grade liquidity rating. The rating outlook is stable. This is
the first time Moody's has rated Boart.
Ratings Rationale
The Ba2 corporate family rating reflects Boart's position as a
leading global supplier of drilling services and drilling
products, principally to the mineral mining industry but also to
the environmental and infrastructure industries. While the
company provides drilling services for a number of metals, gold
remains the largest exposure, accounting for approximately 40% of
drilling services revenue, with copper, nickel, and iron ore also
being important. In addition, while drilling services accounts
for the majority of revenue, the company's products segment, which
manufactures and provides drilling consumables and drilling rigs
for a number of other companies and contributed approximately 27%
of revenue in 2010, provides a degree of diversification, although
end markets served are comparable.
The rating also acknowledges the company's improving financial
metrics and relatively low leverage as measured by the debt/EBITDA
ratio of approximately 1.1x at year-end December 31, 2010. This
follows a significant deleveraging of the company in 2009 when the
company raised just under $700 million in equity and repaid
approximately $647 million of debt. Moody's expect these
improving trends to continue through 2011 and 2012 given the level
of exploration and development activity in the mining sector, as
evidenced by Boart's strengthening rig utilization trends and
order inflow.
However, the rating also considers the company's sensitivity to
mining and metals fundamentals, the cyclicality of the major
industry it serves, and its relatively small size. For example,
Boart's performance in 2009 reflected the impact of a significant
pull back in exploration and drilling activity in the mining
industry with revenues falling about 47% and EBITDA dropping 73%
to about $96 million before Moody's standard adjustments.
Reflecting the benefits of a corporate restructuring undertaken
the last several years to reduce costs and increase efficiency, as
well as the increase in drilling activity in 2010, Boart's
performance rebounded significantly in 2010. Given Moody's
expectations for increasing investment activity in the mining
industry, Moody's anticipate that Boart's performance will
continue to strengthen over the next two years.
The stable outlook incorporates Moody's view that fundamentals for
Boart's business will continue strong in the near- to mid-term as
drilling activity in the mining and other industries served
increases following the curtailments taken in 2009 and given the
need to continue to replace depleting resources and production.
The outlook also anticipates that the company will continue to be
more disciplined in the management of its capital structure with
more manageable debt levels than in the past. However, Moody's do
expect working capital requirements to grow given the growing
revenue base.
The SGL-2 speculative grade liquidity rating reflects Moody's
expectation that Boart should be able to cover the majority of
expenditure requirements over the next twelve months from internal
funds with only minimal need to access the revolver. The company
currently has an $85 million unsecured revolver maturing February
2012 and a $200 million unsecured revolver expiring April 2012.
Both facilities contain a debt/EBITDA covenant and an
EBITDA/interest covenant as well as covenants stipulating that at
least 70% of consolidated EBITDA be generated by the borrowers and
guarantors. Covenants are tested twice a year and Boart remains
comfortably in compliance. Moody's expect that the company will
renegotiate its revolving credit facilities in advance of their
expiration dates thus ensuring liquidity over the medium term.
All debt is unsecured with the exception of some minimal lease
facilities.
Cyclicality in the company's business, industry concentration, and
size are limiting factors to an upgrade. However, should the
company be able to sustain debt/EBITDA below 2.5x, EBITDA minus
capex/interest of at least 4x and be free cash flow generative, an
outlook or rating change could be considered.
Downward pressure could result should the company significantly
relever such that debt/EBITDA exceeded 3.5x, or EBITDA less
capex/interest fall below 3x. Downward pressure would also result
from an erosion in the company's core business should there be a
shift in the competitive environment in which the company
operates.
The notes are rated at the same level as the corporate family
rating as all debt in the capital structure is unsecured.
Assignments:
Issuer: Boart Longyear Pty Limited
* Probability of Default Rating, Assigned Ba2
* Speculative Grade Liquidity Rating, Assigned SGL-2
* Corporate Family Rating, Assigned Ba2
* Senior Unsecured Regular Bond/Debenture, Assigned a Ba2; LGD4 -
56%
Headquartered in South Jordan, Utah, Boart Longyear is
incorporated in Australia and listed on the Australian Securities
Exchange Limited. The company provides drilling services, and
drilling products and equipment principally for the mining and
metals industries. Revenues for the year ended December 31, 2010,
were $1.5 billion.
CAPRIUS INC: Vintage Capital Has Warrant to Buy 16.64MM Shares
--------------------------------------------------------------
In a Form 3 filing with the U.S. Securities and Exchange
Commission, Vintage Capital Group, LLC disclosed that it has
warrant to purchase 16,647,173 shares of common stock of Caprius
Inc. The Fred C. Sands Children's Trust owns 15% of the
membership interests of Vintage Capital Group, LLC. Fred C. Sands
is the trustee of the Children's Trust. The Fred C. Sands Family
Revocable Trust owns 85% of the membership interests of Vintage.
Mr. Sands is the trustee of the Family Trust. Each of Mr. Sands,
the Children's Trust and the Family Trust may be deemed to share
beneficial ownership of the shares beneficially owned by Vintage.
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 Dec. 31, 2010 showed $1.58 million
in total assets, $9.34 million in total liabilities and a
$7.76 million stockholders' deficiency.
Marcum LLP, in New York, expressed substantial doubt about the
Company's ability to continue as a going concern following the
Company's results for fiscal years ended Sept. 30, 2009 and 2010.
The independent auditors noted that the Company has a working
capital deficiency and has substantial recurring losses from
operations. In addition, under the terms of the Loan Facility
Agreement with Vintage Capital Group LLC, the Company was obliged
to fulfill certain defined covenants and achieve specific
milestones, including those relating to unit sales and the
relocation of manufacturing. To date, these aforementioned
covenants and milestones have not been met and the Company has
been put on notice by Vintage of these defaults, Marcum said in
its report attached to the Form 10-K for the fiscal year ended
Sept. 30, 2010.
CARPENTER CONTRACTORS: Hires Crowe Horwath as Auditors
------------------------------------------------------
Carpenter Contractors of America Inc., dba R&D Thiel, and CCA
Midwest Inc. seek permission from the Bankruptcy Court to employ
Crowe Horwath LLP pursuant to a general retainer, nunc pro tunc to
the petition date to perform auditing services. Scott L. Spencer,
CPA, will lead the engagement.
Among other things, the firm will audit and report on the
consolidated financial statements of the Debtor as of and for the
fiscal year ending January 30, 2011.
The firm attests that it does not have any connection with the
creditors or other parties-in-interest or their attorneys, and
does not represent any interest adverse to the Debtor. As a
condition of representation, Crowe is waiving a prepetition claim
of $13,755.
Pompano Beach, Florida-based Carpenter Contractors of America,
Inc., dba R&D Thiel, filed for Chapter 11 bankruptcy protection
(Bankr. S.D. Fla. Case No. 10-42604) on Oct. 25, 2010. The Debtor
estimated its assets at $50 million to $100 million and debts at
$10 million to $50 million. No official committee has been
appointed in the case to date.
CARPENTER CONTRACTORS: Shaw Gussis Bills $14T for Dec-Feb Work
--------------------------------------------------------------
Shaw Gussis Fishman Glantz Wolfson & Towbin LLC, serving as
special counsel to Carpenter Contractors of America Inc., dba R&D
Thiel, and CCA Midwest Inc., filed its first interim application
for compensation, seeking payment of $14,580 in fees and
reimbursement of $43.09 in expenses for the period from Dec. 7,
2010, to Feb. 22, 2011.
Shaw Gussis' engagement was terminated effective Feb. 17,
according to the case's docket. The firm's engagement was led by:
Peter J. Roberts, Esq.
SHAW GUSSIS FISHMAN GLANTZ WOLFSON & TOWBIN LLC
321 North Clark St #800
Chicago, IL 60654
Tel: (312) 276-1322
E-mail: proberts@shawgussis.com
In January, the Debtors won won permission from the Bankruptcy
Court to employ Brian L. Shaw, Esq., and the Law Firm of Shaw
Gussis Fishman Glantz Wolfson & Towbin, LLC, as Special Counsel
for union and pension matters in Illinois.
Pompano Beach, Florida-based Carpenter Contractors of America,
Inc., dba R&D Thiel, filed for Chapter 11 bankruptcy protection
(Bankr. S.D. Fla. Case No. 10-42604) on Oct. 25, 2010. The Debtor
estimated its assets at $50 million to $100 million and debts at
$10 million to $50 million. No official committee has been
appointed in the case to date.
CATHOLIC CHURCH: Dist. Court Affirms Ruling in Suit vs. Insurers
----------------------------------------------------------------
The U.S. District Court for the District of Alaska adopted in
their entirety the proposed findings of fact and conclusions of
law submitted by the U.S. Bankruptcy Court for the District of
Alaska with respect to the second motion for partial summary
judgment and the motion to compel arbitration filed by Catholic
Mutual Relief Society of America in the adversary proceeding
commenced by the Catholic Bishop of Northern Alaska against
Catholic Mutual and other insurers.
In line with the recommendations in the Proposed Findings,
District Court Judge Ralph R. Beistline ruled that:
-- Catholic Mutual's second motion for partial summary
judgment is granted;
-- Catholic Mutual has no duty to defend the Diocese or Robert
L. Berger, in his capacity as the Settlement Trustee, with
respect to the 22 Proofs of Claim that are based on sexual
abuse alleged to have occurred during the period from
April 15, 1979, to April 15, 1983;
-- Catholic Mutual's motion to compel arbitration and stay
proceedings related to post-1990 abuse claims pending
arbitration is granted, in part, and denied, in part;
-- all claims based on acts of sexual abuse that are alleged
to have occurred on or after July 1, 1990, must be
submitted to arbitration in accordance with the provisions
of the insurance certificate issued by Catholic Mutual for
the period from July 1, 2008, through July 1, 2009; and
-- Catholic Mutual's request for a stay pending arbitration is
denied, without prejudice to renewal should the
circumstances materially change.
About the Diocese of Fairbanks
The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic
Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka
The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/--
filed for Chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska
Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady
LLP represents the Debtor in its restructuring efforts. Michael
R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's
local counsel and Cook, Schuhmann & Groseclose Inc. as its special
counsel. Judge Donald MacDonald, IV, of the United States
Bankruptcy Court for the District of Alaska presides over
Fairbanks' Chapter 11 case. In its schedules, the Debtor
disclosed total assets of $13,316,864 and total liabilities of
$1,838,719 as of the Petition Date.
The Bankruptcy Court entered its order confirming the "Debtor's
and the Official Committee of Unsecured Creditors' Third Amended
and Restated Joint Plan of Reorganization for the Catholic Bishop
of Northern Alaska" on February 17, 2010. The effective date of
the Plan occurred on March 19, 2010.
In November 2010, Judge Donald MacDonald IV entered a final decree
and order closing the Chapter 11 case of the Catholic Bishop of
Northern Alaska.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
CATHOLIC CHURCH: Del. Court Gives 18th Order on PIA Withdrawals
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Catholic Diocese of Wilmington, Inc., on an eighteenth 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
Cemeteries 581,985
Charities 407,413
Children's Home 352,741
Siena Hall 330,211
Corpus Christi 287,662
Seton Villa 278,553
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 $13,373,738
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 Diocese filed for Chapter 11 on Oct. 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.
The bankruptcy filing automatically stayed eight consecutive abuse
trials scheduled in Delaware scheduled to begin October 19, 2009.
There were 131 cases filed against the Diocese, with 30 scheduled
for trial, as of the bankruptcy filing.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
CB HOLDING: $10-Mil. Sale of Bugaboo Creek Outlets Approved
-----------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
the owner of Charlie Brown's Steakhouse was authorized by the
bankruptcy court on March 11 to sell the 12 Bugaboo Creek stores
following an auction where the price more than tripled.
RRGK LLC won the auction with a final bid of $10.05 million. The
first bid from an affiliate of Landry's Restaurants Inc. was
$3.175 million.
According to the report, the 20 Charlie Brown's locations go up
for auction April 6. The first bid of $5.2 million will be made
by an affiliate of Praesidian Capital Opportunity Fund III-A LP.
Charlie Brown's previously sold the seven The Office Restaurants
for $4.675 million.
Mr. Rochelle relates that Charlie Brown's, the official creditors'
committee and the principal lender have an agreement in principle
giving part of sale proceeds to unsecured creditors. Financing
for the Chapter 11 case, which has been increased to $5.5 million,
required quick sales. Expiration of the financing was extended to
May 1.
About CB Holding
New York-based CB Holding Corp. operated 20 Charlie Brown's
Steakhouse, 12 Bugaboo Creek Steak House, and seven The Office
Beer Bar and Grill restaurants when it filed for bankruptcy
protection. The Company closed 47 locations before filing for
Chapter 11.
Following a bankruptcy auction, CB Holding sold its The Office
restaurant chain to winning bidder Villa Enterprises Ltd. for
$4.68 million.
The Debtor has signed a $5.2 million contract for an affiliate of
Praesidian Capital Opportunity Fund III-A LP to buy the 20 Charlie
Brown's locations absent a higher bid at auction in March. There
will be a hearing in bankruptcy court on March 9 to approve
auction and sale procedures.
CB Holding and its affiliates filed for Chapter 11 bankruptcy
protection on Nov. 17, 2010 (Bankr. D. Del. Case No. 10-13683).
Christopher M. Samis, Esq., and Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., assist the Debtors in their
restructuring effort. The Garden City Group, Inc., is the
Debtors' notice, claims and solicitation agent. Jeffrey N.
Pomerantz, Esq., Jason S. Pomerantz, Esq., and Bradford J.
Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the
Official Committee of Unsecured Creditors. CB Holding estimated
its assets at $100 million to $500 million and debts at
$50 million to $100 million.
* * *
According to the Troubled Company Reporter on Feb. 11, 2011, CB
Holding received an order from Bankruptcy Judge Mary Walrath
extending its exclusive periods to file and secure support for a
Chapter 11 plan. The exclusive time for the Debtor to file a plan
of reorganization has been extended to June 15. The Debtor has
until Aug. 12 to solicit support for the plan. The order is
without prejudice for a request by the Debtor for another
extension.
CF INDUSTRIES: Moody's Upgrades Corporate Family Rating to 'Ba1'
----------------------------------------------------------------
Moody's Investors Service upgraded CF Industries Holdings, Inc.
Corporate Family Rating to Ba1 from Ba3. Moody's also raised
the ratings on the underlying debt issues: guaranteed senior
secured credit facilities, which includes the remaining
$341.1 million term loan expected to be paid down in March 2011
and the $500 million revolver, to Baa1 from Ba1. Also raised
were the $800 million unsecured notes due 2018 to Ba1 from B1,
and the $800 million unsecured notes due 2020 to Ba1 from B1.
The outlook is stable.
Ratings Rationale
The Ba1 Corporate Family Rating reflects improved market positions
and cash flows gained through the Terra merger combined with
healthy market conditions, particularly for the nitrogen industry
over the intermediate term. The rating is positively impacted by
the strong liquidity position, meaningful debt reduction over the
past two quarters, and management's demonstrated conservative
financial philosophy. The rating is tempered by the existing
secured revolver in the capital structure and that the merger
marks a material change to CF's history of being debt free. The
unadjusted leverage ratio (Debt/EBITDA) of 1.5x is already in
management's target range, and with Moody's Standard Adjustments
this ratio is 1.7x as of December 31, 2010. A final factor in the
upgrade is the prospect of a multi-year time frame for a final
decision on a potential expansion in Peru.
An upward move to the rating could be considered if free cash flow
to debt in excess of ten percent is maintained on a sustainable
basis. Additionally Moody's would look for an elimination of
security provisions on the bank borrowing arrangements, as is
typical of investment grade rated entities. Downward pressure to
the rating is unlikely at this time. Pressure to the rating could
occur if an unexpected and significant debt financed acquisition
or other initiative is considered. The stable outlook reflects
Moody's expectation that the company will manage future cash
balances in a manner consistent with investment grade ratings and
establish a more definitive track record as a larger combined
entity (after the Terra acquisition).
These ratings were upgraded:
CF Industries Holdings, Inc.
* Corporate Family Rating to Ba1 from Ba3
* Probability of Default Rating to Ba1 from Ba3
CF Industries, Inc.
* $1,200 million guaranteed senior secured term loan B-1 due 2015
-- to Baa1 (LGD1, 7%) from Ba1 (LGD2, 22%)
* $500 million guaranteed senior secured term revolver, due 2015 -
- to Baa1 (LGD1, 7%) from Ba1 (LGD2, 22%)
* $800 million 6.875% senior unsecured notes -- to Ba1 (LGD4, 60%)
from B1 (LGD5, 76%)
* $800 million 7.125% senior unsecured notes -- to Ba1 (LGD4, 60%)
from B1 (LGD5, 76%)
These ratings were maintained:
* Speculative Grade Rating -- SGL-1
Moody's most recent announcement concerning the ratings for CF was
on April 26, 2010, at which time the outlook was changed to
positive.
CF Industries Holdings, Inc., headquartered in Deerfield,
Illinois, is a leading global producer of nitrogen based and
phosphate fertilizers. In April 2010 the company acquired Terra
Industries for approximately $4.7 billion in a combination of
cash, assumed debt, and equity. CF generated annual revenues of
$4.0 billion for the year ending December 31, 2010.
CF INDUSTRIES: Fitch Upgrades Long-Term Issuer Default Rating
-------------------------------------------------------------
Fitch Ratings has upgraded the long-term debt and Issuer Default
Ratings of CF Industries Holdings, Inc., and CF Industries, Inc.
The Rating Outlook is Stable.
CF has benefited from a strong tailwind in food demand and farm
economics. This produced enough cash flow to let the company
repay approximately $1.2 billion in debt since last year's
acquisition of Terra Industries Inc. Cash flow from operations
totaled almost $1.2 billion in 2010 with only nine months of
Terra's business included. CF held capital expenditures to
$258 million versus $236 million for CF alone in the prior year.
After dividends free cash flow was over $900 million.
Leverage fell to 1.5 times gross debt/EBITDA at the end of last
year from 2.9x at the end of the prior June. By the close of the
upcoming first quarter, CF will have repaid all of its term loan
debt, leaving only the $1.6 billion in senior unsecured notes that
it issued to finance the Terra acquisition plus some Terra notes
that were assumed. CF's nearest debt maturity is a nominal
$13 million in old Terra notes that come due in 2017 followed by
$800 million of 6.875% unsecured notes due in 2018.
In addition to $800 million in cash and equivalents on its balance
sheet, CF has an undrawn $500 million secured revolver that
matures in 2015. This will be CF's only secured debt after the
term loan is repaid. Financial tests within the revolver include
an interest coverage ratio of 3.0x and a maximum leverage ratio of
3.50x stepping down to 3.25x.
Fitch expects another good season for CF in 2011. Fitch believes
that low natural gas prices will combine with a strong demand for
nitrogen and phosphate based fertilizers to produce a record cash
flow. Demand is being pulled along by good farm economics owing
to high grain prices, pulled in turn by the growing demand for
food in less developed economies and corn-for-ethanol production
here in the United States. As a result gross debt/EBITDA should
contract further to less than 1.0x, and cash flow after capital
expenditures should exceed $1.5 billion.
Fitch upgrades these:
CF Holdings
-- IDR to 'BBB-' from 'BB+'.
CF Industries
-- IDR to 'BBB-' from 'BB+';
-- Senior Secured Revolver to 'BBB' from 'BBB-';
-- Senior Secured Term Loan to 'BBB' from 'BBB-';
-- Senior Unsecured Notes to 'BBB-' from 'BB+'.
CHARLESTON ASSOCIATES: Committee Hires Brinkman as Counsel
----------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
bankruptcy case of Charleston Associates, LLC, seeks permission
from the Bankruptcy Court to employ Brinkman Portillo Ronk, PC, as
its Chapter 11 counsel.
The Committee was appointed on Feb. 3, 2011. The Committee is
comprised of Stephen Black of Asylum Design, LLC; Walter Cornier
of Sunshine Valley Landscape; and Randy Clark of Young Electric
Sign Company.
The Committee has selected BPR to serve as counsel and Womble
Carlyle Sandridge & Rice, PLLC, to serve as its Delaware counsel.
Among other things, BPR will provide legal advice as necessary
with respect to the Committee's powers and duties as an official
committee appointed under 11 U.S.C. Sec. 1102; assist the
Committee in investigating the acts, conduct, assets, liabilities,
and financial condition of the Debtor, the operation of the
Debtor's business, potential claims, and any other matters
relevant to the case, to the sale of assets or to the formulation
of a plan of reorganization; and participate in the formulation of
a Plan.
BPR's hourly rates are:
Professional Hourly Rate
------------ -----------
Daren R. Brinkman, Partner $545
Laura J. Portillo, Partner $455
Kevin C. Ronk, Partner $355
Associate Attorneys $295
Paralegals and Law Clerks $100-$180
Daren R. Brinkman, Esq., a partner of BPR, said there are no
amounts due to BPR from Debtor on account of any prepetition
services rendered. Mr. Brinkman also attested that BPR represents
no other entity in connection with this case, is a "disinterested
person" as that term is defined in 11 U.S.C. Sec. 101(14), and
does not hold or represent any interest adverse to the Committee
with respect to the matters upon which it is to be employed.
About Charleston Associates
Based in Las Vegas, Nevada, Charleston Associates, LLC, aka
FDBA Boca Fashion Village Syndications Group, LLC, and aka
FDBA Boca Fashion Village, LLC, is the successor by merger to Boca
Fashion Village Syndications Group. It owns a portion of a large
community shopping center located in Las Vegas. The entire
shopping center is known as The Shops at Boca Park. It
encompasses almost 55 acres and is situated at the northeast
corner of the intersection of Charleston Boulevard and Rampart
Boulevard. Charleston's current portion of the shopping center
consists of a 20.4 acre parcel located at 700-750 S. Rampart
Boulevard, Las Vegas, that is commonly known as Boca Fashion
Village. Boca Fashion contains, among other things, a 130,000+
square foot parcel of real estate that is currently leased to
Sears Roebuck & Company.
Charleston Associates filed for Chapter 11 (Bankr. D. Del. Case
No. 10-11970) on June 17, 2010. Judge Kevin J. Carey presides
over the case. Bradford J. Sandler, Esq., at Pachulski Stang
Ziehl & Jones LLP, assists the Company in its restructuring
effort. The Company listed $10 million to $50 million in assets
and $50 million to $100 million in liabilities.
CHARLESTON ASSOCIATES: Committee Hires Womble as Delaware Counsel
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
bankruptcy case of Charleston Associates, LLC, has hired as its
Delaware bankruptcy counsel:
Thomas M. Horan, Esq.
WOMBLE CARLYLE SANDRIDGE & RICE, PLLC
222 Delaware Avenue, Suite 1501
Wilmington, DE 19801
Tel: (302) 252-4339
Fax: (302) 661-7707
E-mail: thoran@wcsr.com
The Committee is also seeking to employ Brinkman Portillo Ronk,
PC, as its Chapter 11 counsel.
The Committee was appointed on Feb. 3, 2011. The Committee is
comprised of Stephen Black of Asylum Design, LLC; Walter Cornier
of Sunshine Valley Landscape; and Randy Clark of Young Electric
Sign Company.
About Charleston Associates
Based in Las Vegas, Nevada, Charleston Associates, LLC, aka
FDBA Boca Fashion Village Syndications Group, LLC, and aka
FDBA Boca Fashion Village, LLC, is the successor by merger to Boca
Fashion Village Syndications Group. It owns a portion of a large
community shopping center located in Las Vegas. The entire
shopping center is known as The Shops at Boca Park. It
encompasses almost 55 acres and is situated at the northeast
corner of the intersection of Charleston Boulevard and Rampart
Boulevard. Charleston's current portion of the shopping center
consists of a 20.4 acre parcel located at 700-750 S. Rampart
Boulevard, Las Vegas, that is commonly known as Boca Fashion
Village. Boca Fashion contains, among other things, a 130,000+
square foot parcel of real estate that is currently leased to
Sears Roebuck & Company.
Charleston Associates filed for Chapter 11 (Bankr. D. Del. Case
No. 10-11970) on June 17, 2010. Judge Kevin J. Carey presides
over the case. Bradford J. Sandler, Esq., at Pachulski Stang
Ziehl & Jones LLP, assists the Company in its restructuring
effort. The Company estimated $10 million to $50 million in
assets and $50 million to $100 million in liabilities as of the
Chapter 11 filing.
CITADEL BROADCASTING: Cumulus Media Deal Won't Move Moody's Rating
------------------------------------------------------------------
Moody's Investors Service says that Citadel Broadcasting
Corporation's (Ba2 Corporate family rating) announcement that it
has entered into a definitive merger agreement with Cumulus Media
Inc. (Caa1 Corporate Family rating -- on review for upgrade) under
which Cumulus will acquire Citadel in a cash and stock transaction
valued at about $2.4 billion, creating the second largest radio
broadcaster in the US after Clear Channel Communications (Caa2
Corporate Family rating), will not cause a downgrade of Citadel's
debt. "If not for the change of control protection (typical for
bank debt but sometimes absent from bond indentures), Citadel's
debt would be placed on review and likely face a downgrade of its
credit ratings given the weaker credit profile of Cumulus", stated
Neil Begley, a Moody's Senior Vice President. "However, as the
acquisition will trigger a put back of Citadel's debt, Cumulus is
expected to arrange refinancing to repay Citadel's debt at the
close of the transaction", added Begley. As a result, Moody's
will maintain the current ratings and stable outlook for Citadel's
debt until they are repaid at the close at which time the ratings
will be withdrawn. The transaction is expected to close by year
end 2011.
The last rating was on November 26, 2010, when Moody's assigned
the company's first-lien bank facility a Baa3 senior secured
rating and a Ba3 to its proposed new senior unsecured notes.
Citadel Broadcasting Corporation, with its headquarters in Las
Vegas, Nevada, is a radio broadcaster comprised of 166 FM and 59
AM stations in more than 50 markets. For the LTM period ended
September 30, 2010, Citadel generated revenues of $741 million.
CJS HOLDINGS: Bankruptcy Filing Stays Checkers Lawsuit
------------------------------------------------------
District Judge Virginia M. Hernandez Covington stays proceedings
in the suit, CHECKERS DRIVE-IN RESTAURANTS, INC., a Delaware
corporation, Plaintiff, v. CJS HOLDINGS, INC., a Florida
corporation, et al., Defendants, Case No. 8:11-cv-264-T-33MAP
(M.D. Fla.), following bankruptcy filed by defendants Juliet
Shukitis and Charles Shukitis, and CJS Holdings, Inc., (Bankr.
M.D. Fla. 11-_____) on March 3, 2011.
A copy of the District Court's March 9, 2011 order is available at
http://is.gd/v6HRqbfrom Leagle.com.
CLAIRE'S STORES: Bank Debt Trades at 3% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Claire's Stores,
Inc., is a borrower traded in the secondary market at 96.66 cents-
on-the-dollar during the week ended Friday, March 11, 2011, a drop
of 0.54 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 275 basis points above LIBOR to borrow
under the facility. The bank loan matures on May 29, 2014, and
carries Moody's 'Caa1' rating and Standard & Poor's 'B' rating.
The loan is one of the biggest gainers and losers among 180 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Claire's Stores
Claire's Stores, Inc. -- http://www.clairestores.com/-- is a
specialty retailer offering accessories and jewelry for kids,
tweens, teens, and young women in the 3 to 27 age range. The
Company is organized based on its geographic markets, which
include North American division and European division. As of Jan.
30, 2010, it operated a total of 2,948 stores, of which 1,993 were
located in all 50 states of the United States, Puerto Rico,
Canada, and the United States Virgin Islands (its North American
division) and 955 stores were located in the United Kingdom,
France, Switzerland, Spain, Ireland, Austria, Germany,
Netherlands, Portugal, and Belgium (its European division). Its
stores operate under the trade names Claire's and Icing. In
addition, as of Jan. 30, 2010, it franchised 195 stores in the
Middle East, Turkey, Russia, South Africa, Poland, Greece,
Guatemala and Malta under franchising agreements. It also
operates 211 stores in Japan through its Claire's Nippon 50:50
joint venture with AEON Co. Ltd.
The Company's balance sheet at Oct. 30, 2010, showed $2.79 billion
in total assets, $218.86 million in total current liabilities,
$2.62 billion in long-term debt, and a stockholders' deficit of
$47.89 million. Claire's Stores carries 'Caa2' corporate family
and probability of default ratings, with 'positive' outlook, from
Moody's Investors Service, and 'B-' issuer credit ratings, with
'stable' outlook, from Standard & Poor's.
Moody's Investors Service in December 2010 upgraded Claire's
Stores' ratings, including its Corporate Family Rating and
Probability of Default Rating, to Caa2 from Caa3. The upgrade
reflects a decrease in Claire's probability of default given that
the company can now fully cover its interest expense. This is due
to earnings improvement from solid comparable store sales growth,
improved merchandise margins, and continued expense discipline.
Claire's Caa2 Probability of Default Rating reflects Moody's view
that although Claire's credit metrics have improved, they remain
very weak as a result of its heavy debt load. For the twelve
months ending October 30, 2010, Claire's debt to EBITDA was very
high at 9.3 times.
CLAIRE'S STORES: Moody's Upgrades Ratings on Senior Loan to 'B3'
----------------------------------------------------------------
Moody's Investors Service upgraded Claire's Stores, Inc.'s senior
secured bank credit facilities to B3 from Caa1 and its Speculative
Grade Liquidity Rating to SGL-2 from SGL-3. All other ratings
were affirmed including Claire's Caa2 Corporate Family Rating.
The rating outlook is positive.
Ratings Rationale
The upgrade of Claire's first lien bank facilities is in response
to the repayment of $245 million of the term loan B which reduced
the amount of senior secured first lien bank debt in the capital
structure. The upgrade also reflects Claire's recently issued
$450 million second lien notes which provide additional support to
the first lien bank facilities. Claire's Speculative Grade
Liquidity rating was raised to SGL-2 to reflect the full pay down
of the company's $194 million revolving credit facility along with
Moody's expectation that during the next 12 to 18 months the
company will not need to borrow under its revolver.
Rating upgraded:
* $200 million senior secured revolver expiring 2013 at B3 (LGD 3,
30%) from Caa1 (LGD 3, 34%)
* $1.2 billion senior secured term loan B due 2014 at B3 (LGD 3,
30%) from Caa1 (LGD 3, 34%)
* Speculative Grade Liquidity rating to SGL-2 from SGL-3
Ratings affirmed and LGD point estimates revised:
* Corporate Family Rating at Caa2
* Probability of Default Rating at Caa2
* $450 million senior secured second lien notes due 2019 at Caa3
(LGD 4, to 62% from 63%)
* $236 million senior unsecured notes due 2015 at Caa3 (LGD 4, to
62 from 67%)
* $360 million senior subordinated notes due 2017 at Ca (LGD 6,
94%)
Claire's Caa2 CFR balances the company's good liquidity, ability
to cover interest expense, and self fund growth capital
expenditures, against its very high leverage. Although Moody's
expects Claire's earnings to improve, leverage will likely remain
between 8 and 9 times over the near term. This could make it
difficult for the company to refinance its remaining $1.2 billion
term loan that matures in May 2014, or refinance on favorable
terms. Moody's estimates that Claire's will need to improve
EBITDA by nearly 30% to bring leverage to around 7.5 times, a
level that Moody's believes could make it easier for the company
to refinance its $1.2 billion term loan. Additionally, any
refinancing could result in higher annual interest costs and more
restrictive financial covenants. Claire's low cost of debt
capital is currently an important component of the company's
ability to fully cover its interest expense and to generate
modestly positive free cash flow. The company is not currently
subject to any restrictive financial covenants.
The ratings are supported by Claire's value positioned price
points, international geographic presence, well known brand name,
and high margins relative to specialty retail peers.
The positive outlook reflects Moody's view that Claire's sales and
earnings will improve, which could lead to a higher rating over
time. Claire's can self fund new store openings which will drive
earnings growth as will its value price points which continue to
resonate with consumers. The positive outlook also reflects
Moody's view that Claire's current expense discipline will
continue.
Claire's CFR could be upgraded if the company's operating
performance improves to levels such that a refinancing of its debt
maturities is likely and the company could fully cover its
interest expense, even if interest expense were to increase.
Quantitatively, EBITA to interest expense would need to remain
meaningfully above 1.0 time. Claire's CFR could be downgraded
should operating performance or liquidity deteriorate, interest
coverage weaken, or if for any reason the overall probability of
default were to increase.
The last rating action on Claire's Stores, Inc. was on February
16, 2011 the second lien notes were rated Caa3 and Corporate
Family Rating and Probability of Default Rating were affirmed.
Claire's Stores, Inc., headquartered in Hoffman Estates, IL,
is the leading specialty retailer of value-priced jewelry and
fashion accessories for pre-teens, teenagers, and young adults.
It operates 2,981 stores and franchises 395 stores in North
America and Europe. Annual revenues are about $1.4 billion.
CLEAR CHANNEL: Bank Debt Trades at 12% Off in Secondary Market
--------------------------------------------------------------
Participations in a syndicated loan under which Clear Channel
Communications, Inc., is a borrower traded in the secondary market
at 88.29 cents-on-the-dollar during the week ended Friday, March
11, 2011, a drop of 3.24 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 365 basis points above
LIBOR to borrow under the facility. The bank loan matures on
Jan. 30, 2016, and carries Moody's 'Caa1' rating and Standard &
Poor's 'CCC+' rating. The loan is one of the biggest gainers and
losers among 180 widely quoted syndicated loans with five or more
bids in secondary trading for the week ended Friday.
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.
CC Media's balance sheet at Dec. 31, 2010 showed $17.48 billion in
total assets, $1.25 billion in current liabilities, $20.61 billion
in long-term liabilities and a $7.20 billion shareholders'
deficit.
* * *
CC Media Holdings carries 'CCC+' issuer credit ratings from
Standard & Poor's. 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 in November 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.
In February 2011, Standard & Poor's affirmed its 'CCC+' corporate
credit rating and positive outlook on CC Media Holdings and
operating subsidiary Clear Channel, which S&P views on a
consolidated basis. S&P said the 'CCC+' CCR on CC Media Holdings
reflects the risks surrounding the longer-term viability of the
company's capital structure--in particular, refinancing risk
relating to sizable secured debt maturities in 2014 ($3.2 billion
pro forma for the transaction) and 2016 ($10.4 billion). In S&P's
view, the Company has a satisfactory business risk profile, due to
its position as the largest radio and global outdoor advertising
operator, its good geographic and market diversity, and moderate
long-term growth prospects at the outdoor business. S&P views the
financial risk profile as highly leveraged, given the Company's
significant refinancing risk, roughly break-even EBITDA coverage
of interest expense, and slim discretionary cash flow.
CMB III: Taps Mariscal as Counsel in Int'l Cruise Action
--------------------------------------------------------
C.M.B. III, L.L.C., seeks permission from the Bankruptcy Court to
employ Mariscal Weeks McIntyre & Friedlander, P.A., nunc pro tunc,
as special counsel for purposes of its prosecution of certain
litigation pending in Maricopa County Superior Court, Case No.
2009-028786. The action seeks recovery from International Cruise
& Excursion Gallery, LLC, for damages to personal property owned
by C.M.B.
Mariscal has represented C.M.B. in the Litigation both prior to
the filing of C.M.B.'s petition, and since that date.
Timothy J. Thomason, Esq., at Mariscal attests that his firm has
no known connection with C.M.B., its creditors, or any other party
in interest, their respective attorneys and accountants, the
United States Trustee, or any person employed in the office of the
United States Trustee.
Attorneys for Union Fidelity Life Insurance Company are:
Isaac M. Gabriel, Esq.
Arturo A. Thompson, Esq.
QUARLES & BRADY LLP
Renaissance One
Two North Central Avenue
Phoenix, AZ 85004-2391
E-mail: isaac.gabriel@quarles.com
arturo.thompsonA@quarles.com
Attorney for Maricopa County is:
Barbara Lee Caldwell, Esq.
CALDWELL PADISH & WELLS
7333 E. Doubletree Ranch Road, Suite 255
Scottsdale, AZ 85258
E-mail: bcaldwell@cpwlawyers.com
About C.M.B. III
Phoenix, Arizona-based C.M.B. III, L.L.C., owns a mixed-use
commercial complex located at 13450-13610 N. Black Canyon Freeway,
Phoenix, Arizona. It filed for Chapter 11 bankruptcy protection
(Bankr. D. Ariz. Case No. 10-30496) on September 23, 2010.
Richard M. Lorenzen, Esq., Perkins Coie Brown & Bain P.A., serves
as the Debtor's bankruptcy counsel. The Debtor estimated its
assets and debts at $10 million to $50 million as of the Chapter
11 filing.
As reported by the TCR on Feb. 15, 2011, C.M.B. III, L.L.C., has
filed a Plan of Reorganization and disclosure statement. The Plan
will be funded by a combination of the Debtor's cash on hand as of
the Effective Date, the equity contribution, and cash that is
collected or generated by the Reorganized Debtor after the
Effective Date. Holders of general unsecured claims other than
Union deficiency claims may see an 80% recovery on allowed claims.
A copy of the disclosure statement is available for free at
http://bankrupt.com/misc/CMBIII_DS.pdf
CMS ENERGY: Fitch Affirms 'BB+' Long-Term Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has affirmed the long-term ratings for CMS Energy
Corp., CMS Energy Trust I and Consumers Energy Company.
Approximately $7.2 billion of debt is affected by the rating
actions. The Rating Outlooks for CMS and Consumers Energy are
Stable.
CMS Energy Corp.
-- Issuer Default Rating at 'BB+';
-- Senior secured debt at 'BBB-';
-- Senior unsecured debt at 'BB+'.
CMS Energy Trust I
-- Trust preferred at 'BB-'.
Consumers Energy
-- IDR at 'BBB-';
-- Senior secured debt at 'BBB+';
-- Senior unsecured debt at 'BBB';
-- Preferred stock at 'BB+'.
-- Ratings Withdrawn: CMS Energy preferred securities -
securities were redeemed.
CMS' ratings and Stable Outlook reflect these:
-- Ownership of Consumers Energy, a regulated electric and
natural gas utility that contributes more than 90% of
operating income.
-- Consolidated credit metrics that remain consistent with
Fitch's Comparative Operating Risk ratio guidelines for an
integrated utility.
-- A sufficient consolidated liquidity position with
approximately $1.14 billion of available liquidity including
$247 million of cash on hand.
Rating concerns relate to:
-- CMS' sizeable stand-alone long-term debt of approximately
$2.3 billion, which is structurally subordinated to that of
its subsidiaries. Fitch expects the amount of stand-alone
long-term debt to remain at slightly higher than current
levels for the next two years.
-- The pending delay related to self-implementation of rates in
an annual gas rate case filed by Consumers Energy in August
2010.
-- The significant five-year capital investment plan of $6.4
billion at Consumers Energy.
-- Exposure to a local economy with low growth expectations and
high unemployment.
CMS' credit quality is supported by the financial strength of
Consumers Energy, which benefits from credit metrics that are
above average for Fitch's 'BBB-' rating guidelines for integrated
utilities and a relatively supportive regulatory environment in
Michigan, including timely commodity cost recovery and a revenue
decoupling mechanism to mitigate changes in sales volume.
Consumers Energy's ratios of EBITDA-to-interest, debt-to-EBITDA,
and funds from operations-to-interest were at 5.4 times, debt 3.1x
and 4.9x, respectively for the year ended Dec. 31, 2010. Fitch
notes Consumers' stand-alone rating would be higher than 'BBB-',
but the utility's credit profile continues to be constrained by
that of its parent company.
CMS' cash flow based metrics are currently consistent with Fitch's
guidelines for 'BB+' utility parent companies, with the ratios of
EBITDA-to-interest at 3.4x, debt-to-EBITDA at 4.9x; FFO-to-
interest at 3.3x; and, debt-to-capital at 72% as of Dec. 31, 2010.
Fitch expects cash flow credit metrics at CMS to remain consistent
with its current ratings. The main drivers of future financial
performance will be the outcome of rate orders at the utility and
long-term debt levels at CMS.
At fiscal year end Dec. 31, 2010, CMS reported $2.3 billion in
stand-alone long-term debt and in 2010 raised its common dividend,
indicating to Fitch that reducing the substantial parent debt is
not a current management priority. CMS is dependent on cash
distributions from Consumers Energy to meet its debt service and
common dividend obligations.
In August 2010 Consumers Energy filed its annual gas rate case
with the Michigan Public Service Commission, and the MPSC is
required to issue a final decision within 12 months. In February
2011 (six-months post-filing), the utility is permitted to self
implement an interim rate case, subject to refund with interest
180 days post-final decision. On Feb. 8, 2011, the MPSC required
Consumers Energy to indefinitely delay its plans for self
implementation. The MPSC staff's initial guidance is for a rate
increase of $5.1 million (0.2%) and return on equity of 10.1%;
representing a significant delta from the utility's revised budget
to self implement a rate increase of $29.5 million (1.1%). CMS
management has verbally interpreted the delay as procedural.
Fitch will monitor for developments on the annual gas rate case,
in addition to further rate cases to be filed with the MPSC.
Consumers Energy's capital investment plan is focused primarily on
investments in its distribution and generation operations, in
addition to environmental and renewable projects. In August 2010
Consumers Energy reduced its five-year capital investment plan by
$1 billion, and in May 2010 deferred indefinitely the development
of an 830 MW coal-fueled plant. Fitch expects CMS to downstream
equity distributions to support Consumers Energy's capital
spending budget, and for Consumers Energy to access external
capital markets for further funding needs.
Fitch's credit concerns are partially offset by consolidated
liquidity which is sufficient to meet near-term funding
requirements, including manageable consolidated debt maturities of
$439 million in 2011, $429 million in 2012 and $590 million in
2013. Fitch expects maturing debt to be met with a combination of
internal cash generation and external debt financings. At Dec.
31, 2010, consolidated liquidity was $1.14 billion, including $897
million of availability under credit facilities, and $247 million
in cash and cash equivalents. Fitch expects the $550 million CMS
credit facility due in April 2012 and the $500 million Consumers
Energy facility due in March 2012 to be renewed in the first half
of 2011. The $150 million Consumers Energy credit facility
matures in August 2013. At FYE Dec. 31, 2010, Consumers Energy
had $250 million in availability under its Accounts Receivable
Program. Furthermore, Fitch expects Consumers Energy will
continue to make cash distributions to CMS to support parent debt
and other cash obligations.
CMS is a utility holding company whose primary subsidiary is
Consumers Energy, a regulated electric and gas utility serving
more than 3.5 million customers in Michigan's Lower Peninsula.
CMS also has operations in natural gas pipelines and independent
power production.
COMCAM INT'L: Pinnacle Had $1.34-Mil. in Assets when Acquired
-------------------------------------------------------------
ComCam International, Inc., filed on March 9, 2011, Amendment No.
2 to its annual report on Form 10-K/A-2 for the fiscal year ended
Dec. 31, 2009, to (i) include historical financial statements of
Pinnacle Integrated Systems separate from those of the Company,
and (ii) expand the Company's narrative discussion of material
changes and year to date comparisons to address the pre-
acquisition results of operations of Pinnacle Integrated Systems.
Pinnacle Integrated Systems was acquired by the Company on
Dec. 30, 2009.
Pinnacle's revenue for the period ended Dec. 30, 2009, increased
to $6,373,947 from $948,900 for the year ended Dec. 31, 2008, an
increase of 572%. Pinnacle' net income for the period ended
Dec. 30, 2009, was $650,543 as compared to net loss of $286,344
for the year ended Dec. 31, 2008.
Pinnacle's balance sheet at Dec. 30, 2009, showed $1,344,632 in
total assets, $980,433 in total liabilities, all current, and
stockholders' equity of $364,199.
A full-text copy of the Form 10-K/A is available for free at:
http://researcharchives.com/t/s?7504
A full-text copy of Pinnacle's audited financial statements is
available for free at http://researcharchives.com/t/s?7505
About ComCam International
West Chester, Pa.-based ComCam International, Inc. is both a
network solutions innovator and a provider of fusion technologies
for security products and modern networks. The Company's
proprietary digital wireless camera systems and security
integration solutions address complex command-and-control
applications for rapid-deployment military situations, borders,
ports, airports, and detention facilities.
ComCam International's balance sheet at Sept. 30, 2010, showed
$2.1 million in total assets, $2.5 million in total liabilities,
and a stockholders' deficit of $438,243.
* * *
As reported in the Troubled Company Reporter on April 24, 2010,
Pritchett, Siler & Hardy, P.C., in Salt Lake City, expressed
substantial doubt about ComCam International's ability to continue
as a going concern, following its 2009 results. The independent
auditors noted of the Company's substantial losses and working
capital deficit.
COMMERCIAL VEHICLE: Computershare Rights Agreement Terminates
-------------------------------------------------------------
On March 8, 2011, the Board of Directors of Commercial Vehicle
Group, Inc., adopted, and the Company entered into, Amendment No.
1 to the Company's Stockholder Rights Plan as set forth in the
Rights Agreement, dated as of May 21, 2009, between the Company
and Computershare Trust Company, N.A. The Amendment amended and
accelerated the Final Expiration Date to March 8, 2011.
As a result of the Amendment, (i) the Rights Agreement was
terminated on March 8, 2011, the Final Expiration Date, (ii) the
rights to purchase shares of Series A Preferred Stock, par value
$.01 per share, of the Company pursuant to the Rights Agreement
expired on March 8, 2011, (iii) since the Final Expiration Date,
no Rights are associated with or attached to any outstanding
shares of the Company's common stock, par value $0.01 per share,
and (iv) since the Final Expiration Date, no person has any rights
under the Rights Agreement.
A full-text copy of Amendment No. 1 to Rights Agreement is
available for free at http://ResearchArchives.com/t/s?74f5
About Commercial Vehicle Group
New Albany, Ohio-based Commercial Vehicle Group, Inc., (Nasdaq:
CVGI) supplies fully integrated system solutions for the global
commercial vehicle market, including the heavy-duty truck market,
the construction and agricultural markets, and the specialty and
military transportation markets. The Company has facilities
located in the United States in Arizona, Indiana, Illinois, Iowa,
North Carolina, Ohio, Oregon, Tennessee, Virginia and Washington
and outside of the United States in Australia, Belgium, China,
Czech Republic, Mexico, Ukraine and the United Kingdom.
The Company's balance sheet at Dec. 31, 2010 showed
$286.21 million in total assets, $286.32 million in total
liabilities, and a $112,000 stockholders' deficit.
* * *
Commercial Vehicle carries a 'Caa1' Corporate Family Rating from
Moody's Investors Service. It has 'CCC+' issuer credit ratings
from Standard & Poor's.
In mid-October 2010, Moody's Investors Service upgraded Commercial
Vehicle Group's Corporate Family Rating to 'Caa1' from 'Caa2', and
revised the ratings outlook to positive from negative. These
positive actions recognize the continuing improvement in the build
rates for commercial vehicles and the realized benefits of the
company's operating and capital restructurings. According to
Moody's, the 'Caa1' CFR reflects modest size, high debt leverage,
and exposure to highly cyclical commercial vehicle end markets.
Demand for commercial vehicle components is sensitive to both
economic cycles and regulatory implementation schedules.
CONSTELLATION ENTERPRISES: S&P Assigns 'B' Corporate Credit Rating
------------------------------------------------------------------
Standard & Poor's Rating Services assigned its 'B' corporate
credit rating to Ohio-based Constellation Enterprises LLC
(Constellation) and a 'B' issue-level rating to the company's new
$130 million senior secured notes due 2016. The recovery rating
on this debt is '4', indicating S&P's expectation of average
recovery (30%-50%) in a default scenario. The outlook is stable.
"The ratings on Constellation reflect its highly leveraged
financial risk profile, marked by substantial leverage, and S&P's
expectation that its credit measures, while satisfactory for the
rating based on the proposed refinancing transaction, could remain
volatile," said Standard & Poor's credit analyst Peter Kelly.
"These factors are partially tempered by the company's relative
end-market diversity, its well-established position as a custom
supplier to various niche industrial sectors, and S&P's
expectation that revenues and operating profits should increase
over the next few years amid improving demand fundamentals in key
segments and operating efficiencies."
The outlook is stable. S&P expects the company's operating
performance to improve in 2011 amid gradual recovery in key
markets, such as railcar manufacturing. The ratings incorporate
S&P's expectation of revenue growth in the mid-teens in 2011 along
with adjusted operating margins (before depreciation and
amortization) expanding from the low-teen to the mid-teen
percentage area. S&P believes this should lead to gradually
strengthening credit measures towards levels that are comfortable
for the rating, including adjusted debt to EBITDA improving
towards 4x, providing some flexibility for weaker-than-expected
operating performance.
"S&P could lower the ratings if subpar operating performance,
higher-than-expected cash outflows and/or debt-financed activities
adversely affect the company's liquidity or result in a
significant deterioration of credit measures," Mr. Kelly
continued, "for example, if debt to EBITDA is meaningfully higher
than 5x for an extended period. On the other hand, if the long-
term competitiveness of Constellation's businesses remains
healthy, if its credit measures are sustained at less than 4x
adjusted debt to EBITDA, and if its liquidity and financial
policies support a higher rating, S&P could, consider a one-notch
upgrade.
CONSTRUCTORA CJ: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Constructora CJ & M Inc.
P.O. Box 1410
Aguada, PR 00602
Tel: (787) 823-2175
Bankruptcy Case No.: 11-02074
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Luis E. Correa Gutierrez, Esq.
FIRSTBANK PUERTO RICO
P.O. Box 194089
San Juan, PR 00919
Tel: (787) 296-9500
Fax: (787)-296-9510
E-mail: lcorrea@lvvlaw.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/prb11-02074.pdf
The petition was signed by Carlos Moreno Gonzalez, president.
COUNTERPATH CORP: Posts $491,200 Net Loss in Jan. 31 Quarter
------------------------------------------------------------
CounterPath Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $491,260 on $3.0 million of revenue for
the three months ended Jan. 31, 2011, compared with a net loss of
$1.7 million on $1.4 million of revenue for the same period of the
prior fiscal year.
The Company's balance sheet at Jan. 31, 2011, showed $14.8 million
in total assets, $4.7 million in total liabilities, and
stockholders' equity of $10.1 million.
BDO Canada LLP, in Vancouver, Canada, expressed substantial doubt
about CounterPath's ability to continue as a going concern,
following the Company's results for the fiscal year ended
April 30, 2010. The independent auditors noted that the Company
had an accumulated deficit of $39.8 million at April 30, 2010, and
incurred a net loss for the year then ended of $5.4 million.
A full-text copy of the Form 10-Q is available for free at:
http://researcharchives.com/t/s?7509
About CounterPath Corporation
Based in Vancouver, British Columbia, Canada, CounterPath
Corporation (OTC BB: CPAH; TSX-V: CCV) focuses on the design,
development, marketing and sales of desktop and mobile application
software, gateway server software and related professional
services, such as pre and post sales, technical support and
customization services.
CUMULUS MEDIA: Bank Debt Trades at 1% Off in Secondary Market
-------------------------------------------------------------
Participations in a syndicated loan under which Cumulus Media Inc.
is a borrower traded in the secondary market at 98.79 cents-on-
the-dollar during the week ended Friday, March 11, 2011, an
increase of 0.43 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 175 basis points above
LIBOR to borrow under the facility. The bank loan matures on June
11, 2014, and carries Moody's 'Caa1' rating and Standard & Poor's
'B-' rating. The loan is one of the biggest gainers and losers
among 180 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Cumulus Media
Based in Atlanta, Georgia, Cumulus Media Inc. (NASDAQ: CMLS) --
http://www.cumulus.com/-- is the second largest radio broadcaster
in the United States based on station count, controlling 350 radio
stations in 68 U.S. media markets. In combination with its
affiliate, Cumulus Media Partners, LLC, the Company believes it is
the fourth largest radio broadcast company in the United States
when based on net revenues.
The Company's balance sheet at Sept. 30, 2010, showed
$324.06 million in total assets, $673.31 million in total
liabilities, and a stockholders' deficit of $349.25 million.
Cumulus Media carries a 'Caa1' corporate family rating, and 'Caa2'
probability-of-default rating, with 'stable' outlook, from Moody's
Investors Service. It has 'B-' issuer credit ratings, with
'stable' outlook, from Standard & Poor's.
In February 2011, Standard & Poor's revised its rating outlook on
Cumulus Media Inc. to positive from stable. "The positive outlook
revision reflects the asset and cash flow diversification benefits
that Cumulus will gain in acquiring Cumulus Media Partners LLC,"
said Standard & Poor's credit analyst Andy Liu.
Moody's on Jan. 31, 2011, said that there is no operational nor
immediate credit impact upon closing of Cumulus Media Inc.'s
acquisition of Cumulus Media Partners. Cumulus has operated CMP's
radio stations since it was formed in 2006 so there are no
meaningful changes to operations.
DEX MEDIA EAST: Bank Debt Trades at 22% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media East LLC
is a borrower traded in the secondary market at 78.00 cents-on-
the-dollar during the week ended Friday, March 11, 2011, a drop of
0.89 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 250 basis points above LIBOR to borrow
under the facility, which matures on Oct. 24, 2014. The debt is
not rated. The loan is one of the biggest gainers and losers
among 180 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Dex Media East
Based in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun &
Bradstreet Corp. (NYSE: RHD) -- 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. The
Official Committee of Unsecured Creditors tapped Ropes & Gray LLP
as its counsel, Cozen O'Connor as Delaware bankruptcy co-counsel,
J.H. Cohn LLP as its financial advisor and forensic accountant,
and The Blackstone Group, LP, as its financial and restructuring
advisor.
The Debtors emerged from Chapter 11 bankruptcy proceedings at the
end of January 2010.
DEX MEDIA WEST: Bank Debt Trades at 10% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media West LLC
is a borrower traded in the secondary market at 89.88 cents-on-
the-dollar during the week ended Friday, March 11, 2011, a drop
of 1.73 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 450 basis points above LIBOR to borrow
under the facility, which matures on Oct. 24, 2014. The bank loan
is not rated. The loan is one of the biggest gainers and losers
among 180 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Dex Media West
Dex Media West LLC is a subsidiary of Dex Media West, Inc., and an
indirect wholly owned subsidiary of Dex Media, Inc. Dex Media is
a direct wholly owned subsidiary of R.H. Donnelley Corporation.
Dex Media West is the exclusive publisher of the official yellow
pages and white pages directories for Qwest Corporation, the local
exchange carrier of Qwest Communications International, Inc., in
Arizona, Idaho, Montana, Oregon, Utah, Washington, and Wyoming.
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 represented the Debtors in their
restructuring efforts. Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP, in
Wilmington, Delaware, served as the Debtors' local counsel. The
Debtors' financial advisor was Deloitte Financial Advisory
Services LLP while its investment banker was Lazard Freres & Co.
LLC. The Garden City Group, Inc., was claims and noticing agent.
The Official Committee of Unsecured Creditors tapped Ropes & Gray
LLP as its counsel, Cozen O'Connor as Delaware bankruptcy co-
counsel, J.H. Cohn LLP as its financial advisor and forensic
accountant, and The Blackstone Group, LP, as its financial and
restructuring advisor.
The Debtors emerged from Chapter 11 bankruptcy proceedings at the
end of January 2010.
DOO WOP: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------
Debtor: Doo Wop, LLC
dba Happy Bays Car Wash
2137 E. Lensfield Pl
Fayetteville, AR 72701
Bankruptcy Case No.: 11-71114
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
Western District of Arkansas (Fayetteville)
Judge: Ben T. Barry
Debtor's Counsel: Stanley V. Bond, Esq.
BOND LAW OFFICE
P.O. Box 1893
Fayetteville, AR 72701-1893
Tel: (479) 444-0255
Fax: (479) 444-7141
E-mail: attybond@me.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/arwb11-71114.pdf
The petition was signed by Robert Lewis, manager.
DRYSHIPS INC: Ocean Rig to Hold Shareholders Meeting on April 15
----------------------------------------------------------------
Ocean Rig UDW Inc., DryShips Inc.'s subsidiary, expects that a
special meeting of shareholders will be held on April 15, 2011, at
16:00 local time at the Company's offices located at 10 Skopa
Street, Tribune House, 2nd Floor, Office 202, CY 1075, Nicosia,
Cyprus. It is expected that Ocean Rig UDW Inc. shareholders of
record at the close of business on March 10, 2011 will be entitled
to receive notice and to vote at the special meeting or any
adjournments or postponements thereof.
Formal notice of the special meeting and the Company's proxy
statement containing the proposals that shareholders will be asked
to consider and vote upon will be sent to shareholders of the
Company when available. Shareholders are urged to read the proxy
statement when available because it will contain important
information.
About DryShips Inc.
Based in Greece, DryShips Inc. -- http://www.dryships.com/--
-- owns and operates drybulk carriers and offshore oil
deep water drilling units that operate worldwide. As of September
10, 2010, DryShips owns a fleet of 40 drybulk carriers (including
newbuildings), comprising 7 Capesize, 31 Panamax and 2 Supramax,
with a combined deadweight tonnage of over 3.6 million tons and
6 offshore oil deep water drilling units, comprising of 2 ultra
deep water semisubmersible drilling rigs and 4 ultra deep water
newbuilding drillships.
DryShips's common stock is listed on the NASDAQ Global Select
Market where it trades under the symbol "DRYS".
The Company's balance sheet at Sept. 30, 2010, showed
US$5.80 million in total assets, US$1.90 million in total current
liabilities, US$1.10 million in total noncurrent liabilities, and
stockholders' equity of US$2.80 million.
On November 25, 2010, DryShips Inc. entered into a waiver letter
for its US$230.0 million credit facility dated September 10, 2007,
as amended, extending the waiver of certain covenants through
Dec. 31, 2010.
As reported in the Troubled Company Reporter on Sept. 29, 2010,
the Company said it is currently in negotiations with its lenders
to obtain waivers, waiver extensions or to restructure its debt.
As of June 30, 2010, the Company's theoretical exposure (current
portion of long-term debt less cash and cash equivalents less
restricted cash) amounted to US$761.4 million.
DOUMULIN SOLUTIONS: Pursues Reorganization Case in Canada
---------------------------------------------------------
Quebec, Canada-based Dumoulin Solutions Inc., and its units
commenced on Feb. 22, 2011 in the District of Montreal, Province
of Quebec under the Companies' Creditors Arrangement Act.
Dumoulin is the largest Canadian-owned and operated retailer of
electronics, computers, cameras, communication and gaming
products. Dumoulin currently operates 15 corporate retail
locations situated in the provinces of Quebec and Ontario and has
90 franchise locations across Canada operating under the
"Dumoulin" (in Quebec) or "Audiotronic" (outside Quebec) banners.
It has 343 employees working in its corporate retail stores, head
office and warehouses.
Hotel Solutions USA, Inc., a unit of Doumulin, filed a Chapter 15
petition in Dallas, Texas, on March 10, 2011. Hotel Solutions
estimated assets and debts of $1 million to $10 million as of the
Chapter 15 filing.
Hotel Solutions seeks the U.S. Court's recognition of the
voluntary reorganization proceeding (Case No. 500-11-040345-114)
that the company, its parent, and its affiliates Dumoulin Electric
Group Inc., and Dumoulin Franchise Management Inc., commenced on
Feb. 22, 2011, in the District of Montreal, Province of Quebec
under the Companies' Creditors Arrangement Act.
Michel Levasseur, chief financial officer of Hotel Solutions,
relates in a court filing that over the last few years, the
Dumoulin Entities shifted their primarily retail business model to
one which included a sizeable business-to-business component and
growing cross-border activities. The Dumoulin Entities, through
the Debtor, have developed business as a key supplier of flat
panel televisions, mounting brackets and other electronics in the
Canadian and United States' hospitality markets. The Debtor's
primary customers are large hotel operators and developers.
The Bank of Montreal is owe C$4,820,000 under a credit facility
provided to the Dumoulin Entities. Ingram Micro Inc., which
provides inventory management services to the Debtor, is owed
$1,752,463. Various trade suppliers are owed a total of
$22,851,984.
"Over the past three years, the Debtor's financial performance
has suffered due to declining prices on some key products,
declining sales volume, and reductions of financing.
Additionally, the Debtor has been impacted by the 2008 and 2009
recession," Mr. Levasseur explains.
The Debtor asks the U.S. Court to recognize that the CCAA
proceedings "as the foreign main proceeding". It also filed an
emergency motion with the U.S. Court to enforce the automatic stay
pending the determination of the verified petition for
recognition.
The Debtor is defendant to a lawsuit by Samsung (D. N.J. Case No.
2:10-cv-05819-KSH) seeking injunctive relief against the Debtor's
assets located in the United States. The Debtor has also received
a notice of repossession from Ingram Micro Inc. Worldwide
Sourcing Solutions, Inc., a unit of Wyndham Worldwide Corporation,
also wants to terminate a sourcing agreement.
Dominic Deslandes, on behalf of Raymond Chabot Inc., the foreign
representative, signed the petition. Raymond Chabot, a Canadian
restructuring firm, is the monitor appointed in the CCAA cases.
DYNEGY INC: Inks Consulting Pact and Release With Ex-CFO
--------------------------------------------------------
On Feb. 23, 2011, Dynegy Inc. filed a current report on Form 8-K
that announced that effective March 11, 2011 Holli C. Nichols will
resign as Executive Vice President and Chief Financial Officer.
Ms. Nichols will receive a $250,000 lump sum payment for limited
consulting services to Dynegy. On March 8, 2011, Dynegy entered
into a consulting agreement and release with Ms. Nichols that
provides for such consulting services from March 12, 2011 through
May 12, 2011. In consideration of the payment under the
Consulting Agreement, Ms. Nichols agreed to release claims related
to any matter related to her employment with, separation from, or
affiliation with the Company. In consideration for the consulting
services to be provided by Ms. Nichols, Dynegy agreed to release
claims arising from Ms. Nichols employment relationship with
Dynegy.
A full-text copy of the Consulting Agreement and Release is
available for free at http://ResearchArchives.com/t/s?74f0
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE:DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
The Troubled Company Reporter has chronicled Dynegy's attempts to
sell itself. In August 2010, Dynegy struck a deal to be acquired
by an affiliate of The Blackstone Group at $4.50 a share or
roughly $4.7 billion. That offer was raised to $5.00 a share in
November. Through Icahn and Seneca's efforts, shareholders
thumbed down both offers. On December 22, 2010, an affiliate of
IEP commenced a tender offer to purchase all of the outstanding
shares of Dynegy common stock for $5.50 per share in cash, or
roughly $665 million in the aggregate.
Goldman, Sachs & Co. and Greenhill & Co., LLC, are serving as
financial advisors and Sullivan & Cromwell LLP is serving as legal
counsel to Dynegy.
The Company's balance sheet at Dec. 31, 2010, showed
$10.013 billion in total assets, $7.267 billion in total
liabilities, and stockholders' equity of $2.746 billion.
Ernst & Young LLP, in Houston, said that Dynegy projects that it
is likely that it will not be able to comply with certain debt
covenants throughout 2011. "This condition and its impact on
Dynegy Inc.'s liquidity raises substantial doubt about Dynegy
Inc.'s ability to continue as a going concern."
The Company reported a net loss of $234 million on $2.323 billion
of revenues for 2010, compared with a net loss of $1.262 billion
on $2.468 billion of revenues for 2009.
* * *
As reported by the Troubled Company Reporter on Nov. 26, 2010,
Fitch Ratings 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'; and Dynegy Capital Trust I
preferred to 'C/RR6' from 'CCC/RR6'. 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.
In October 2010, Moody's Investors Service lowered the ratings of
Dynegy Holdings, including its Corporate Family Rating, to 'Caa1'
from 'B3' along with the ratings of various affiliates or parent
company Dynegy Inc. The rating action followed the expiration of
the 40-day "go shop" period, according to Moody's, increasing the
probability that Dynegy will be acquired by an affiliate of The
Blackstone Group L.P.. Moody's said Dynegy's financial profile is
expected to be quite fragile, particularly during 2011 and 2012,
when the company is projected to generate both negative operating
cash flow and negative free cash flow due to weak operating
margins and the required funding of their capital investment
programs. To the extent that the transactions with Blackstone and
NRG are not completed, Moody's said downward rating pressure at
DHI and Dynegy will continue to exist given the weak financial
prospects for the company over the next few years coupled with the
liquidity concerns.
In December 2010, Moody's said its ratings and negative rating
outlook for Dynegy, Inc., and its subsidiary, Dynegy Holdings
(Caa1 Corporate Family Rating) will remain unchanged following
announcement of the Icahn deal.
DYNEGY INC: Seneca and Icahn Name New Members to Board
------------------------------------------------------
Dynegy Inc.'s Board of Directors has elected Thomas W. Elward, E.
Hunter Harrison, Vincent J. Intrieri and Samuel Merksamer to the
Dynegy Board, effective March 9, 2011. Mr. Harrison was nominated
by Seneca Capital. Mr. Intrieri and Mr. Merksamer were nominated
by Icahn Associates, and Mr. Elward was independently identified.
The four new directors have been named as the sole members of the
Board's Governance and Nominating Committee, which has been tasked
with the responsibility of searching for a permanent Chief
Executive Officer and additional qualified director nominees to
stand for election at the Company's Annual Meeting of
Stockholders. In addition, the four new directors will serve on
the Board's Special Committee for Finance and Restructuring. Mr.
Harrison will lead the Governance and Nominating Committee. Mr.
Intrieri will lead the Special Committee for Finance and
Restructuring.
"Today's director elections demonstrate the Board's commitment to
an expeditious and orderly transfer of leadership at Dynegy," said
Patricia A. Hammick, Chairman of Dynegy Inc. "The Board has
recognized the desire of our stockholders to pursue a different
path for the Company. The new directors will take the lead in
charting a course forward for Dynegy, both in selecting new Board
members and new executive leadership."
In addition, Dynegy announced that the 2011 Annual Meeting of
Stockholders will be held on June 15, 2011, in Houston. The
Governance and Nominating Committee will consider suggestions from
stockholders for director candidates up to April 1, 2011, which
will be shortly before the time when Dynegy will announce its
proposed slate of nominees for the 2011 Annual Meeting. As
previously announced, Dynegy directors Patricia A. Hammick, David
W. Biegler, Victor E. Grijalva, Howard B. Sheppard and William L.
Trubeck do not intend to stand for reelection at the Annual
Meeting of Stockholders.
Thomas W. Elward, age 63, served as President and Chief Operating
Officer of CMS Enterprises from March 2003 to July 2008. Mr.
Elward previously served in various roles with CMS Generation, a
subsidiary of CMS Enterprises, including President and Chief
Operating Officer from March 2003 to July 2008; President and
Chief Executive Officer from January 2002 to February 2003; Senior
Vice President - Operations and Asset Management from July 1998 to
December 2001; and Vice President - Operations from March 1990 to
June 1998. Prior to CMS Enterprises, he held roles of increasing
responsibility at Consumers Power, advancing to the position of
Plant Manager.
E. Hunter Harrison, age 65, is currently a private investor. Mr.
Harrison served as the President and Chief Executive Officer of
Canadian National Railway Company from January 2003 until December
2009 and as its Chief Operating Officer from 1998 until 2003.
Prior to joining Canadian National Railway, Mr. Harrison was the
President and Chief Executive Officer of Illinois Central Railroad
from 1993 until February 1998 and its Chief Operating Officer from
1989 to 1993. Mr. Harrison served on the Board of Directors of
Canadian National Railway from December 1999 until December 2009.
Mr. Harrison also served on the boards of The American Association
of Railroads, The Belt Railway of Chicago, Terminal Railway,
Wabash National Corporation (NYSE:WNC), Illinois Central Railroad
and TTX Company.
Vincent J. Intrieri, age 54, has been a Senior Managing Director
of Icahn Capital LP since November 2004. Since January 2005, Mr.
Intrieri has been Senior Managing Director of Icahn Associates
Corp. and High River Limited Partnership. Mr. Intrieri has been a
director since July 2006 of Icahn Enterprises G.P. Inc. From
April 2005 through September 2008, Mr. Intrieri was the President
and Chief Executive Officer of Philip Services Corporation. Since
December 2007, Mr. Intrieri has been the Chairman of the Board and
a director of PSC Metal, Inc. Since August 2005, Mr. Intrieri has
served as a director of American Railcar Industries, Inc. From
March 2005 to December 2005, Mr. Intrieri was a Senior Vice
President, Treasurer and Secretary of ARI. Since April 2003, Mr.
Intrieri has been Chairman of the Board and a director of Viskase
Companies, Inc. From November 2006 to November 2008, Mr. Intrieri
served on the Board of Lear Corporation. From August 2008 to
September 2009, Mr. Intrieri was a director of WCI Communities,
Inc. Mr. Intrieri also serves on the boards of the following
companies: National Energy Group, Inc., XO Holdings, Inc.,
WestPoint International Inc. and Federal-Mogul Corporation. With
respect to each company mentioned above, Carl C. Icahn, directly
or indirectly, either (i) controls such company or (ii) has an
interest in such company through the ownership of securities. Mr.
Intrieri was a certified public accountant.
Samuel Merksamer, age 30, has served as an investment analyst at
Icahn Capital LP, a subsidiary of Icahn Enterprises L.P., since
May 2008. Mr. Merksamer is responsible for identifying, analyzing
and monitoring investment opportunities and portfolio companies
for Icahn Capital. Mr. Merksamer serves as a director of Viskase
Companies, Inc., PSC Metals Inc. and Federal-Mogul Corporation.
Viskase Companies, PSC Metals and Federal-Mogul are each, directly
or indirectly, controlled by Carl C. Icahn. From 2003 until 2008,
Mr. Merksamer was an analyst at Airlie Opportunity Capital
Management, a hedge fund management company, where he focused on
high yield and distressed investments.
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE:DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
The Troubled Company Reporter has chronicled Dynegy's attempts to
sell itself. In August 2010, Dynegy struck a deal to be acquired
by an affiliate of The Blackstone Group at $4.50 a share or
roughly $4.7 billion. That offer was raised to $5.00 a share in
November. Through Icahn and Seneca's efforts, shareholders
thumbed down both offers. On December 22, 2010, an affiliate of
IEP commenced a tender offer to purchase all of the outstanding
shares of Dynegy common stock for $5.50 per share in cash, or
roughly $665 million in the aggregate.
Goldman, Sachs & Co. and Greenhill & Co., LLC, are serving as
financial advisors and Sullivan & Cromwell LLP is serving as legal
counsel to Dynegy.
The Company's balance sheet at Dec. 31, 2010, showed
$10.013 billion in total assets, $7.267 billion in total
liabilities, and stockholders' equity of $2.746 billion.
Ernst & Young LLP, in Houston, said that Dynegy projects that it
is likely that it will not be able to comply with certain debt
covenants throughout 2011. "This condition and its impact on
Dynegy Inc.'s liquidity raises substantial doubt about Dynegy
Inc.'s ability to continue as a going concern."
The Company reported a net loss of $234 million on $2.323 billion
of revenues for 2010, compared with a net loss of $1.262 billion
on $2.468 billion of revenues for 2009.
* * *
As reported by the Troubled Company Reporter on Nov. 26, 2010,
Fitch Ratings 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'; and Dynegy Capital Trust I
preferred to 'C/RR6' from 'CCC/RR6'. 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.
In October 2010, Moody's Investors Service lowered the ratings of
Dynegy Holdings, including its Corporate Family Rating, to 'Caa1'
from 'B3' along with the ratings of various affiliates or parent
company Dynegy Inc. The rating action followed the expiration of
the 40-day "go shop" period, according to Moody's, increasing the
probability that Dynegy will be acquired by an affiliate of The
Blackstone Group L.P.. Moody's said Dynegy's financial profile is
expected to be quite fragile, particularly during 2011 and 2012,
when the company is projected to generate both negative operating
cash flow and negative free cash flow due to weak operating
margins and the required funding of their capital investment
programs. To the extent that the transactions with Blackstone and
NRG are not completed, Moody's said downward rating pressure at
DHI and Dynegy will continue to exist given the weak financial
prospects for the company over the next few years coupled with the
liquidity concerns.
In December 2010, Moody's said its ratings and negative rating
outlook for Dynegy, Inc., and its subsidiary, Dynegy Holdings
(Caa1 Corporate Family Rating) will remain unchanged following
announcement of the Icahn deal.
DYNEGY INC: Waives Section 203 of General Corporation Law
---------------------------------------------------------
On March 8, 2011, Icahn Partners Master Fund LP and its affiliates
entered into a letter agreement with Dynegy Inc. pursuant to which
the Company waived Section 203 of the Delaware General Corporation
Law in order to allow Icahn to own and acquire voting stock of the
Company up to, but not exceeding, 19.99999% of the outstanding
voting stock of Dynegy.
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE:DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
The Troubled Company Reporter has chronicled Dynegy's attempts to
sell itself. In August 2010, Dynegy struck a deal to be acquired
by an affiliate of The Blackstone Group at $4.50 a share or
roughly $4.7 billion. That offer was raised to $5.00 a share in
November. Through Icahn and Seneca's efforts, shareholders
thumbed down both offers. On December 22, 2010, an affiliate of
IEP commenced a tender offer to purchase all of the outstanding
shares of Dynegy common stock for $5.50 per share in cash, or
roughly $665 million in the aggregate.
Goldman, Sachs & Co. and Greenhill & Co., LLC, are serving as
financial advisors and Sullivan & Cromwell LLP is serving as legal
counsel to Dynegy.
The Company's balance sheet at Dec. 31, 2010, showed
$10.013 billion in total assets, $7.267 billion in total
liabilities, and stockholders' equity of $2.746 billion.
Ernst & Young LLP, in Houston, said that Dynegy projects that it
is likely that it will not be able to comply with certain debt
covenants throughout 2011. "This condition and its impact on
Dynegy Inc.'s liquidity raises substantial doubt about Dynegy
Inc.'s ability to continue as a going concern."
The Company reported a net loss of $234 million on $2.323 billion
of revenues for 2010, compared with a net loss of $1.262 billion
on $2.468 billion of revenues for 2009.
* * *
As reported by the Troubled Company Reporter on Nov. 26, 2010,
Fitch Ratings 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'; and Dynegy Capital Trust I
preferred to 'C/RR6' from 'CCC/RR6'. 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.
In October 2010, Moody's Investors Service lowered the ratings of
Dynegy Holdings, including its Corporate Family Rating, to 'Caa1'
from 'B3' along with the ratings of various affiliates or parent
company Dynegy Inc. The rating action followed the expiration of
the 40-day "go shop" period, according to Moody's, increasing the
probability that Dynegy will be acquired by an affiliate of The
Blackstone Group L.P.. Moody's said Dynegy's financial profile is
expected to be quite fragile, particularly during 2011 and 2012,
when the company is projected to generate both negative operating
cash flow and negative free cash flow due to weak operating
margins and the required funding of their capital investment
programs. To the extent that the transactions with Blackstone and
NRG are not completed, Moody's said downward rating pressure at
DHI and Dynegy will continue to exist given the weak financial
prospects for the company over the next few years coupled with the
liquidity concerns.
In December 2010, Moody's said its ratings and negative rating
outlook for Dynegy, Inc., and its subsidiary, Dynegy Holdings
(Caa1 Corporate Family Rating) will remain unchanged following
announcement of the Icahn deal.
EV ENERGY: Moody's Assigns 'B1' Corporate Family Rating
-------------------------------------------------------
Moody's Investors Service assigned first time ratings to EV
Energy Partners, L.P., in conjunction with its planned
$250 million senior unsecured note offering. The assigned
ratings are: a B1 Corporate Family Rating, a B3 rating to its
proposed offering of $250 million of senior unsecured notes due
2019 and a SGL-3 Speculative Grade Liquidity rating. The rating
outlook is stable.
Ratings Rationale
"EV Energy's durable property base, geographically diversified
portfolio of oil and natural gas properties, and seasoned
management supports its B1 rating," stated Francis J. Messina,
Moody's Vice President. "However, the rating also reflects the
partnership's small production scale and its master limited
partnership structure and distribution burden to its unit
holders."
The partnership's property base is anchored by its recently
acquired Barnett Shale and Mid-Continent holdings, which produces
primarily natural gas and accounted for approximately 48% of total
proved reserves at December 31, 2010. This proved reserve
concentration is bolstered by production from oil and liquids
producing properties located in the Austin Chalk, San Juan,
Permian, and Barnett. For the full year 2010, EV Energy's
production was approximately 30% liquids with total proved
developed reserves approximately 71%. The company has plans to
increase its total proved developed reserves to 80% over the near-
term resulting in a robust capital spending plan. Since 2006, EV
Energy has completed $1.3 billion of acquisitions, 64% financed
with equity and cash flow, which helps to bolster its relatively
moderate leverage compared to some of its B1 rated peers.
EV Energy's strengths are tempered by its master limited
partnership structure that accordingly distributes a high
proportion of its operating cash flow. The partnership also has
relatively modest production volumes, which at approximately
19,000 Boe (including the recent Barnett acquisition) per day is
among the smallest of all B1 rated independent exploration and
production companies. EV Energy's leverage as measured on
production volumes is relatively high.
The SGL-3 rating is based on Moody's expectation that EV Energy
will have adequate liquidity over the next twelve months. The
proceeds of the senior unsecured notes offering will be used
to repay borrowings under the partnership's senior secured
revolving credit facility. Availability at December 31, 2010,
was $81 million. Pro forma for this debt and the recent equity
offering plus a corresponding reduction to its borrowing base, EV
Energy's availability on its $700 million borrowing base revolver
will approximate $423 million. Additionally, the partnership's
revenues are supported by a policy of consistently hedging a high
proportion of production, which provides predictability to its
cash flows, supports the borrowing base for its revolver, and
should help maintain adequate headroom under its bank covenants.
Moody's expect the borrowing base revolver's availability to be
more than adequate to fund the forecasted slightly negative free
cash flow over the course of 2011 and into 2012.
The B3 senior unsecured notes rating reflects both the overall
probability of default of EV Energy, to which Moody's assigns a
PDR of B1, and a loss given default of LGD 5 (87%). The proposed
senior notes are unsecured and guaranteed by the restricted
subsidiaries on a senior unsecured basis. The revolving credit
facility has a borrowing base of $700 million and a senior secured
claim to a significant portion of the company's assets. The size
of the credit facility's potential priority claim in comparison to
the senior notes results in the notes being rated two notches
beneath EV Energy's B1 CFR, in accordance with Moody's Loss Given
Default Methodology.
The stable outlook reflects Moody's expectation that EV Energy
will grow production and reserves to support its cash flow
distributions and capital growth program without any increase in
leverage. To be considered for a positive rating action, the
company's production should exceed 40,000 Boe per day with
consistent debt to average daily production under $20,000 per Boe
given its MLP structure. Nevertheless, at that level EV Energy
would continue to be among the smallest of all Ba3 rated
independent exploration and production companies. A negative
rating action is a possibility if leverage, production or
operating costs deteriorate from its current level.
EV Energy Energy Partners L.P. is an independent exploration and
production master limited partnership headquartered in Houston,
Texas.
FANNIE MAE: Former Exec. Receives Wells Notice From SEC
-------------------------------------------------------
Nick Timiraos, writing for The Wall Street Joural, reports that
Daniel Mudd, the former chief executive of Fannie Mae, said he has
received a Wells notice from the Securities and Exchange
Commission. According to the Journal, Mr. Mudd said in a
statement provided to Bloomberg News that he had received the
formal notification from the SEC that it plans to pursue civil
claims against him. The development was first reported by
Bloomberg News.
The Journal recounts Mr. Mudd took the helm of Fannie in 2004 in
the midst of an accounting scandal and oversaw its financial-
reporting restatement with the SEC. He was sacked by the
government when it took control of the mortgage firm in 2008 and
agreed to inject unlimited sums as ballooning loan losses wiped
away thin capital reserves. In August 2009, he became CEO of New
York-based hedge fund Fortress Investment Group LLC.
A Wells notice indicates that the SEC staff is preparing to
recommend civil enforcement actions and gives individuals the
opportunity to persuade regulators against such an action.
Mr. Mudd plans to submit a written response, he said in the
statement provided to Bloomberg.
* * *
Mr. Timiraos, in a separate report, says Republican lawmakers are
preparing this week to introduce a series of legislative proposals
to gradually reduce the role of Fannie Mae and Freddie Mac. The
effort represents a tactical shift from the comprehensive approach
for a speedier wind-down of the mortgage-finance giants that
Republicans backed during last year's negotiations on the Dodd-
Frank Act. The report notes one measure would accelerate the
wind-down of the firms' combined $1.5 trillion mortgage
portfolios, which are already set to decline by 10% annually.
Other measures would eliminate the firms' federal affordable-
housing goals and gradually raise the guarantee fees that Fannie
and Freddie charge lenders, a decision now made by the firms and
their federal regulator.
About Fannie Mae
Federal National Mortgage Association, aka Fannie Mae, is a
government-sponsored enterprise that was chartered by U.S.
Congress in 1938 to support liquidity, stability and affordability
in the secondary mortgage market, where existing mortgage-related
assets are purchased and sold.
The Company's balance sheet at Dec. 31, 2010 showed
$3.222 trillion in total assets, $3.224 trillion in total
liabilities and a $2.52 billion total deficit.
Fannie Mae has been under conservatorship, with the Federal
Housing Finance Agency acting as conservator, since September 6,
2008. As conservator, FHFA succeeded to all rights, titles,
powers and privileges of the company, and of any shareholder,
officer or director of the company with respect to the company and
its assets. The conservator has since delegated specified
authorities to Fannie Mae's Board of Directors and has delegated
to management the authority to conduct day-to-day operations.
The U.S. Department of the Treasury owns Fannie Mae's senior
preferred stock and a warrant to purchase 79.9% of its common
stock, and Treasury has made a commitment under a senior preferred
stock purchase agreement to provide Fannie with funds under
specified conditions to maintain a positive net worth.
FIBRE CRAFT: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Fibre Craft Corporation
fdba Fibre Craft of Tennessee, Inc.
P.O. Box 1415
Dandridge, TN 37725
Bankruptcy Case No.: 11-31108
Chapter 11 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
Eastern District of Tennessee (Knoxville)
Judge: Richard Stair Jr.
Debtor's Counsel: Keith L. Edmiston, Esq.
P.O. Box 425
Knoxville, TN 37902
Tel: (865) 384-2827
E-mail: keith.edmiston@gmail.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/tneb11-31108.pdf
The petition was signed by Walt Rosin, president.
FIRST NATIONAL: Closed; Pauls Valley National Assumes All Deposits
------------------------------------------------------------------
The First National Bank of Davis of Davis, Okla., was closed on
Friday, March 11, 2011, by the Office of the Comptroller of the
Currency, which appointed the Federal Deposit Insurance
Corporation as receiver. To protect the depositors, the FDIC
entered into a purchase and assumption agreement with The Pauls
Valley National Bank of Pauls Valley, Okla., to assume all of the
deposits of The First National Bank of Davis.
The sole office of The First National Bank of Davis will reopen
under normal business hours as a branch of The Pauls Valley
National Bank. Depositors of The First National Bank of Davis
will automatically become depositors of The Pauls Valley National
Bank. Deposits will continue to be insured by the FDIC, so there
is no need for customers to change their banking relationship in
order to retain their deposit insurance coverage up to applicable
limits. Customers of The First National Bank of Davis should
continue to use their existing branch until they receive notice
from The Pauls Valley National Bank that it has completed systems
changes to allow other The Pauls Valley National Bank branches to
process their accounts as well.
As of Dec. 31, 2010, The First National Bank of Davis had around
$90.2 million in total assets and $68.3 million in total deposits.
In addition to paying a premium of 7.5% to assume all of the
deposits of the failed bank, The Pauls Valley National Bank agreed
to purchase around $28.5 million of The First National Bank of
Davis' assets. The FDIC will retain the remaining assets for
later disposition.
Customers who have questions about the transaction can call the
FDIC toll-free at 1-800-613-0523. Interested parties also can
visit the FDIC's Web site at
http://www.fdic.gov/bank/individual/failed/firstnatldavis.html
The FDIC estimates that the cost to the Deposit Insurance Fund
will be $26.5 million. Compared to other alternatives, The Pauls
Valley National Bank's acquisition was the least costly resolution
for the FDIC's DIF. The First National Bank of Davis is the 24th
FDIC-insured institution to fail in the nation this year, and the
second in Oklahoma. The last FDIC-insured institution closed in
the state was The First State Bank, Camargo, on January 28, 2011.
FIVE STAR FOODS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Five Star Foods, Inc.
275 Veterans Boulevard
Rutherford, NJ 07070
Bankruptcy Case No.: 11-17073
Chapter 11 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
District of New Jersey (Newark)
Judge: Morris Stern
Debtor's Counsel: David Edelberg, Esq.
NOWELL AMOROSO KLEIN BIERMAN, P.A.
155 Polifly Road
Hackensack, NJ 07601
Tel: (201) 343-5001
Fax: (201) 343-5181
E-mail: dedelberg@njbankruptcy.com
Estimated Assets: $1,000,001 to $10,000,000
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 Rudolph S. Volpe, president.
FLINT TELECOM: Delays Registration of 12-Mil. Kodiak Shares
-----------------------------------------------------------
Flint Telecom Group Inc. filed an amended Form S-1 with the U.S.
Securities and Exchange Commission regarding the resale of up to
12,000,000 shares of the Company's common stock, par value $0.01
per share, by Kodiak Capital Group, LLC, the selling shareholder.
The shares of common stock offered by Kodiak are issuable to
Kodiak pursuant to the Investment Agreement entered into by and
between Kodiak and the Flint Telecom Group, Inc., dated Nov. 26,
2010, as amended and restated on Jan. 19, 2011. The Company will
not receive any proceeds from the sale of these shares by Kodiak.
The registration statement covers only a portion of the shares of
common stock that may be issuable pursuant to the IA. The Company
may file subsequent registration statements covering the resale of
additional shares of common stock issuable pursuant to the IA with
Kodiak. The Company will bear all costs associated with this
registration statement.
The Company amended the Registration Statement as may be necessary
to delay its effective date until the Company will file a further
amendment which specifically states that this Registration
Statement will thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until
the Registration Statement will become effective on such date as
the Securities and Exchange Commission, acting pursuant to Section
8(a), may determine.
About Flint Telecom
Overland Park, Kan.-based Flint Telecom Group, Inc. (OTC BB: FLTT)
-- http://www.flinttelecomgroup.com/-- operates its business
through six wholly-owned subsidiaries, Cable and Voice
Corporation, Phone House, Inc., Flint Prepaid, Inc. (previously
named Wize Communications, Inc.), Digital Phone Solutions, Inc.,
Ingedigit International, Inc. and Gotham Ingedigit Financial
Processing Corp. dba Power2Process. The Company provides next
generation turnkey voice, data and wireless services through
partner channels primarily in the United States.
The Company's balance sheet at Dec. 31, 2010, showed $10.2 million
in total assets, $17.7 million in total liabilities, $4.9 million
in redeemable equity securities, and a stockholders' deficit of
$12.4 million.
As reported in the Troubled Company Reporter on October 26, 2010,
L.L, Bradford & Company, LLC, in Las Vegas, Nev., expressed
substantial doubt about Flint Telecom'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 losses from operations, negative cash flows
from operations and current liabilities exceed current assets.
FORBES ENERGY: S&P Raises Corporate Credit Rating to 'CCC+'
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Houston-based Forbes Energy Services LLC to 'CCC+' from
'CCC'. The outlook is developing.
"The upgrade reflects the continued improvement in Forbes'
operating performance and cash flows and expectations that this
performance will continue given improving demand for oil-related
oilfield services," said Standard & Poor's credit analyst Paul
Harvey. Based on current industry trends, S&P expects Forbes to
have sufficient cash flow to fund near-term spending requirements,
including interest payments totaling roughly $24 million through
February 2012, without impairing liquidity. Further, S&P expects
Forbes to maintain very modest capital spending to ensure
sufficient free cash flow generation. Nevertheless, Forbes
remains highly susceptible to a market downturn given its high
debt and interest burdens. In particular, Forbes' exposure to
natural gas focused drilling which is expected to ebb from current
levels in the second half of 2011, gives pause for concern.
Forbes will need to fully benefit from the growing focus on
liquids-rich plays such as the Eagle Ford shale. In addition, if
equipment demand falls, Forbes could face competition from
stronger competitors such as Key Energy Services and Nabors
Industries. Finally, the lack of a credit facility, material cash
reserves, or other source of secondary liquidity beyond operating
cash flows, leaves Forbes highly exposed to a sudden weakening in
market conditions.
The developing outlook reflects the potential for positive or
negative rating actions depending on the sustainability of Forbes'
improved operating performance and liquidity. A downgrade could
occur if market conditions or financial policies change such that
Forbes has difficulty maintaining sufficient liquidity to cover
future interest payments. An upgrade could occur if S&P is
confident that industry conditions will remain robust, and that
Forbes will be able to build sufficient liquidity, likely $20
million or greater, to weather a period of weaker market
fundamentals.
FOREVER CONSTRUCTION: Status Hearing on May 5
---------------------------------------------
According to docket information in the bankruptcy case of Forever
Construction, Inc., Judge Jack B. Schmetterer will hold a status
hearing on related to the Debtor's exit plan and disclosure
statement on May 5, 2011, at 10:30 a.m. at 219 South Dearborn,
Courtroom 682, in Chicago, Illinois.
In December, the judge extended the Debtor's exclusive periods for
filing a plan and disclosure statement and for obtaining
acceptances of plan. Pursuant to that order, the Debtor was
required to file a Chapter 11 Plan by Feb. 26. The Disclosure
Statement is due by March 24. The Debtor were given until
April 26 to solicit plan votes.
Pursuant to the docket, a plan has yet to be filed. On Feb. 26,
the Debtor instead filed a motion seeking an extension of its
exclusive periods.
Waukegan, Illinois-based Forever Construction, Inc., filed for
Chapter 11 on July 27, 2010 (Bankr. N.D. Ill. Case No. 10-33276).
Joel A. Schechter, Esq., assists the Debtor in its restructuring
effort. The Debtor estimated its assets and debts at $10 million
to $50 million in its Chapter 11 petition. No creditors committee
has been appointed in the case.
FREDDIE MAC: EVP Bisenius to Step Down Effective April 1
--------------------------------------------------------
Nick Timiraos, writing for The Wall Street Journal, reports that
Donald J. Bisenius, a 19-year veteran of Freddie Mac, who
currently serves as the executive vice president in charge of the
firm's single-family credit guarantee business, will leave Freddie
on April 1.
* * *
Mr. Timiraos, in a separate report, says Republican lawmakers are
preparing this week to introduce a series of legislative proposals
to gradually reduce the role of Fannie Mae and Freddie Mac. The
effort represents a tactical shift from the comprehensive approach
for a speedier wind-down of the mortgage-finance giants that
Republicans backed during last year's negotiations on the Dodd-
Frank Act. The report notes one measure would accelerate the
wind-down of the firms' combined $1.5 trillion mortgage
portfolios, which are already set to decline by 10% annually.
Other measures would eliminate the firms' federal affordable-
housing goals and gradually raise the guarantee fees that Fannie
and Freddie charge lenders, a decision now made by the firms and
their federal regulator.
About Freddie Mac
Based in McLean, Virginia, the Federal Home Loan Mortgage
Corporation, known as Freddie Mac (OTCBB: FMCC) --
http://www.FreddieMac.com/-- was established by Congress in
1970 to provide liquidity, stability and affordability to the
nation's residential mortgage markets. Freddie Mac supports
communities across the nation by providing mortgage capital to
lenders. Over the years, Freddie Mac has made home possible for
one in six homebuyers and more than five million renters.
Freddie Mac is under conservatorship and is dependent upon the
continued support of Treasury and the Federal Housing Finance
Agency acting as conservator to continue operating its
business.
GARRYAVE, LLC: Case Summary & 2 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: GARRYAVE, LLC
1761 E. Garry Avenue, 2nd Floor
Santa Ana, CA 92705
Bankruptcy Case No.: 11-13422
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Linda B. Riegle
Debtor's Counsel: David J. Winterton, Esq.
DAVID J. WINTERTON & ASSOC., LTD.
211 N. Buffalo Drive, #A
Las Vegas, NV 89145
Tel: (702) 363-0317
E-mail: david@davidwinterton.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/nvb11-13422.pdf
The petition was signed by Matthew Peterson, partner.
GENERAL GROWTH: Court Allows WTC to Continue Holding $14.66-Mil.
----------------------------------------------------------------
Judge Allan L. Gropper of the U.S. Bankruptcy Court for the
Southern District of New York issued an interim order on GGP,
Inc. and its debtor affiliates' objection to Wilmington Trust
FSB's request for payment of fees.
Judge Gropper ruled that, pending further order of the Court,
Wilmington Trust will continue to hold in escrow the amount of
$14,658,203 deposited by General Growth Properties, Inc. with
Wilmington Trust on the Effective Date of the Third Amended Joint
Plan of Reorganization for certain purposes, including possible
payment of reasonable fees, expenses, costs and any other
liabilities payable from distributions pursuant to the Plan and
the Exchangeable Notes Indenture as ultimately determined by the
Court after further notice and hearing.
Judge Gropper further ruled that Wilmington Trust's charging lien
pursuant to Section 2.6 of the Plan and Sections 7.08 and 8.07 of
the Exchangeable Notes Indenture, and other applicable
provisions, will be deemed to attach to $10,480,113 of the GGP
Escrow, subject to the right of any party to challenge the
attachment of that charging lien upon the filing a proper motion
with the Court, and upon on notice and opportunity for an
evidentiary a hearing, with all parties' rights reserved.
Wilmington Trust will retain the Charging Lien Amount in escrow
subject to its charging lien for appropriate disposition pursuant
to further Court order, including possible payment of the
Investors' pro rata share of any reasonable fees, expenses,
costs, and any other liabilities payable from distributions
pursuant to the Plan, the Exchangeable Notes Indenture or
otherwise, Judge Gropper stated
Judge Gropper also ordered Wilmington Trust to distribute to the
holders of Exchangeable Notes Claims from whom cash distributions
were withheld the sum of $8,165,230, ratably, and will retain in
escrow, pending further Court order, and possible resolution by
the Court of the matters raised in the Reorganized Debtors'
Objection, Magnetar Financial LLC's Cross Motion, the adversary
proceeding initiated by Moelis and Company, and all other matters
concerning liabilities payable from distributions pursuant to the
Exchange Notes Indenture, or by the settlement of the parties,
the sum of $7,677,723.
Judge Gropper clarified that the Interim Order will not affect
the rights and obligations of General Growth or any other party
in connection with any matter not expressly addressed in the
Interim Order, including under the Exchangeable Notes Indenture
or the Plan.
Judge Gropper said he will retain jurisdiction to decide and
determine all matters concerning the fee disputes identified in,
among others, the Objection, the Cross Motion, Wilmington's
statement, the responses, the reply and any other pleadings
relating to, among other things, the amounts held by Wilmington
Trust in the GGP Escrow and the Note Holders' Reserve including
resolution of the parties' obligations and related rights to
which, if any, amounts maintained in the GGP Escrow or the Note
Holders' Reserve are subject to any charging lien under the
Exchangeable Notes Indenture, which determination will be on
notice to all interested parties, treated as a contested matter
and set down for evidentiary hearing upon further notice, and all
rights, if any, of all persons in connection with the matters not
specifically determined in the Interim Order are reserved.
Judge Gropper further clarified that nothing in the Interim Order
will imply that there is any obligation to pay out of any escrow
or deemed escrow, or pursuant to a Charging Lien, unreasonable
fees or expenses.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 protection on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, serve as bankruptcy counsel. Kirkland &
Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been
engaged as claims agent. The Company also hired AlixPartners LLP
as financial advisor and Miller Buckfire Co. LLC, as investment
bankers. The Debtors disclosed $29,557,330,000 in assets and
$27,293,734,000 in debts as of Dec. 31, 2008.
General Growth Properties on Nov. 9, 2010, successfully completed
the final steps of its financial restructuring and emerged from
Chapter 11. GGP successfully restructured approximately
$15 billion of project-level debt Recapitalized with $6.8 billion
in new equity capital Paid all creditor claims in full achieved
substantial recovery for equity holders.
As part of its plan of reorganization, GGP has split itself into
two separate and independent publicly traded corporations. GGP
shareholders as of the record date of Nov. 1, 2010, received
common stock in both companies. The new GGP, which will commence
trading Nov. 10 on The New York Stock Exchange under the ticker
symbol "GGP," is the second-largest shopping mall owner and
operator in the country, with more than 183 regional malls in 43
states. The spin-off company, The Howard Hughes Corporation,
consists of GGP's portfolio of master planned communities and
other strategic real estate development opportunities. This
company will trade under the ticker symbol "HHC" on The New York
Stock Exchange.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL GROWTH: Gen. Trust Requests for $598,337 Admin. Claim
-------------------------------------------------------------
Pursuant to Sections 503(b)(3)(D) and 503(b)(3)(F) of the
Bankruptcy Code, General Trust Company asks the Court to allow its
administrative expense claim for $598,337.
GTC's designee, Steven H. Shepsman, executive managing director
of New World Real Estate Advisors, LLC, acted as chairman of the
Official Committee of Equity Security Holders.
GTC hired NWRA to provide financial advisory services from
Dec. 22, 2009, to March 24, 2010 and real estate services from
Feb. 9, 2011 to Oct. 26, 2010, to the Equity Committee.
NWRA incurred $264,050 for financial advisory services and
$334,287 for real estate advisory services for the period
Dec. 22, 2009 to Oct. 26, 2010.
John Jerome, Esq., at Saul Ewing LLP, in New York, asserts that
GTC incurred expenses for NWRA's services that enabled the Equity
Committee to fully and meaningfully participate in the Plan
process and to assist in maximizing value to equity in the
Reorganized Debtors' Chapter 11 cases. Indeed, the financial
advisory services provided by NWRA were necessary to fill in a
temporary gap left by the employment by the Reorganized Debtors'
initial financial advisor, he points out. Similarly, the real
estate advisory services were necessary to provide crucial
expertise as to the value, quality and structure of the
Reorganized Debtors' assets, including those being spun-off to
equity by the Reorganized Debtors, he asserts.
These additional services were over and above the considerable
services which GTC, through NWRA, provided and paid for
incidental to its service as a member of the Equity Committee and
as a shareholder, Mr. Jerome continues. The Additional Services
totaling $598,337 for which payment is sought assisted in
bringing substantial value to the Reorganized Debtors' Chapter 11
cases by informing the Equity Committee and thus facilitating the
support of equity holders at crucial times, ultimately leading to
the consensual plan that maximized recovery for all stakeholders,
he stresses.
Essentially, the expenses incurred by GTC in providing the
Additional Services were actual and necessary, were incurred in
the performance of the Equity Committee's statutory duties, and
made a substantial contribution to the case and equity's
recovery, Mr. Jerome insists. Accordingly, GTC's reimbursement
request satisfies the Section 503(b)(3)(F) and 503(b)(3)(D) and
should thus be allowed, he maintains.
General Trust filed the fee application on March 4, 2011 as
stipulated with the Reorganized Debtors.
Subsequently, General Trust filed an amended application to
correct a signature block previously filed on March 4, 2011.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 protection on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, serve as bankruptcy counsel. Kirkland &
Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been
engaged as claims agent. The Company also hired AlixPartners LLP
as financial advisor and Miller Buckfire Co. LLC, as investment
bankers. The Debtors disclosed $29,557,330,000 in assets and
$27,293,734,000 in debts as of Dec. 31, 2008.
General Growth Properties on Nov. 9, 2010, successfully completed
the final steps of its financial restructuring and emerged from
Chapter 11. GGP successfully restructured approximately
$15 billion of project-level debt Recapitalized with $6.8 billion
in new equity capital Paid all creditor claims in full achieved
substantial recovery for equity holders.
As part of its plan of reorganization, GGP has split itself into
two separate and independent publicly traded corporations. GGP
shareholders as of the record date of Nov. 1, 2010, received
common stock in both companies. The new GGP, which will commence
trading Nov. 10 on The New York Stock Exchange under the ticker
symbol "GGP," is the second-largest shopping mall owner and
operator in the country, with more than 183 regional malls in 43
states. The spin-off company, The Howard Hughes Corporation,
consists of GGP's portfolio of master planned communities and
other strategic real estate development opportunities. This
company will trade under the ticker symbol "HHC" on The New York
Stock Exchange.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL GROWTH: GGP Wants Cure Objections Deemed Resolved
---------------------------------------------------------
GGP, Inc. and its debtor affiliates ask Judge Allan L. Gropper of
the U.S. Bankruptcy Court for the Southern District of New York
to deem resolved all of the Reorganized Debtors' pending lease
assumption cure amounts raised by certain tenants and anchors for
purposes of these Chapter 11 cases.
A schedule of the unresolved cure objections filed by the Tenants
and Anchors is available for free at:
http://bankrupt.com/misc/ggp_TenantCureObjs.pdf
Each of the Tenants and Anchors is a party to at least one lease
or unexpired Property Document with the Reorganized Debtors that
was in effect as of the Petition Date.
The Plan Debtors filed plan supplements containing schedules of
executory contracts and unexpired Shopping Center Documents that
they sought to assume in these Chapter 11 cases, including the
Shopping Center Documents. The Plan Supplements also specified
the cure amount proposed by the applicable Plan Debtor for each
Shopping Center Document identified.
The Tenants and Anchors have timely responded, either informally
or through a formal objection, and either disputed the
Reorganized Debtors' proposed cure amounts or preserved their
rights to do so pending an attempted resolution of those cure
amounts.
To resolve these Cure Objections, the Reorganized Debtors have
been engaged in active negotiations with the Tenants and Anchors
to determine the appropriate cure amounts in connection with the
Plan Debtors' assumption of these Shopping Center Documents.
Indeed, of the more than 20,000 Shopping Center Documents assumed
by the Reorganized Debtors in their Chapter 11 cases, less than
800 remain subject to a pending Cure Objection, Marcia L.
Goldstein, Esq., at Weil, Gotshal & Manges LLP, in New York,
tells the Court.
Despite the Reorganized Debtors' efforts to resolve the Cure
Objections, each Cure Amount is disputed or remains contingent,
unliquidated, or otherwise unknown, Ms. Goldstein relates. The
Reorganized Debtors intend to pay the Cure Amounts in the
ordinary course of business if and when the obligations asserted
by the Tenants and Anchors become due and owing, and when the
Reorganized Debtors and the Tenants and Anchors resolve all
disputes related to that Cure Amount, she says.
Accordingly, the Reorganized Debtors filed this motion deeming
the Cure Objections resolved in these Chapter 11 cases. This
will not only reduce the costs being incurred by the Reorganized
Debtors, but will get them one step closer to fully administering
the claims register and closing the chapter 11 cases, Ms.
Goldstein reasons.
Ms. Goldstein continues that the Bankruptcy Court is not most the
efficient forum for the resolution of the Cure Objections.
Indeed, many of the Cure Objections will resolve themselves in
the ordinary course of business as the Reorganized Debtors and
the Tenants and Anchors reconcile their books and records, she
says. In the event that the Reorganized Debtors and the Tenants
and Anchors are unable to resolve any issues related to the Cure
Objections, the Shopping Center Documents and applicable state
law provide for a forum in which the parties can resolve any
remaining disputes, she notes.
Ms. Goldstein clarifies that the Reorganized Debtors are not
seeking to impinge upon the Tenants' and Anchors' right to
payment of any Cure Amounts, and the Reorganized Debtors are not
seeking to impair or otherwise affect the Tenants' and Anchors'
rights to seek relief in an alternative forum in the ordinary
course of business. Rather, the Reorganized Debtors are trying
to move resolution of these matters outside of the bankruptcy
process in order to make reconciliation and resolution proceed
swiftly, while eliminating the attendant costs of resolving such
objection in the Court, she insists.
Given the Reorganized Debtors' strong financial condition upon
emergence, the Tenants and Anchors should not require further
adequate assurance of future performance, Ms. Goldstein assures
the Court.
The Court will consider the Reorganized Debtors' Motion on
April 14, 2011. Objections are due no later than April 4.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 protection on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, serve as bankruptcy counsel. Kirkland &
Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been
engaged as claims agent. The Company also hired AlixPartners LLP
as financial advisor and Miller Buckfire Co. LLC, as investment
bankers. The Debtors disclosed $29,557,330,000 in assets and
$27,293,734,000 in debts as of Dec. 31, 2008.
General Growth Properties on Nov. 9, 2010, successfully completed
the final steps of its financial restructuring and emerged from
Chapter 11. GGP successfully restructured approximately
$15 billion of project-level debt Recapitalized with $6.8 billion
in new equity capital Paid all creditor claims in full achieved
substantial recovery for equity holders.
As part of its plan of reorganization, GGP has split itself into
two separate and independent publicly traded corporations. GGP
shareholders as of the record date of Nov. 1, 2010, received
common stock in both companies. The new GGP, which will commence
trading Nov. 10 on The New York Stock Exchange under the ticker
symbol "GGP," is the second-largest shopping mall owner and
operator in the country, with more than 183 regional malls in 43
states. The spin-off company, The Howard Hughes Corporation,
consists of GGP's portfolio of master planned communities and
other strategic real estate development opportunities. This
company will trade under the ticker symbol "HHC" on The New York
Stock Exchange.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: Internal Revenue Service's Claims Resolved
----------------------------------------------------------
To resolve their claims disputes, Motors Liquidation CO., General
Motors LLC and the United States of America, on behalf of the
Internal Revenue Service sought and obtained approval of the U.S.
Bankruptcy Court for the Southern District of New York a
stipulation resolving the IRS's claims against the Debtors.
The Debtors agree to withdraw the 15th Omnibus Claims Objection
to the IRS's Claim nos. 70162, 70163, 70164, 70165, 70166, 70167,
and 31233. The Debtors also withdraw the 205th Omnibus Objection
as to Claim Nos. 70502, 70503, 70505, 70506, 70507, and 70512.
In turn, the IRS withdraws Claim Nos. 70162, 70163, 70164, 70165,
70166, 70167, 31233, 70502, 70503, 70505, 70506, 70507 and 70512
from the Debtors' claims register.
New GM agrees that, pursuant and subject to the terms of the
Master Purchase Agreement, it has assumed the type of tax
liabilities associated with Claim Nos. 70502, 70503, 70505,
70506, 70507 and 70512 -- Proofs of Claim. New GM and the U.S.
Government reserve all of their statutory, judicial and
administrative rights with respect to the Assumed Tax
Liabilities. New GM stands in the shoes of the Debtors for all
purposes with respect to the Assumed Tax Liabilities, and that
New GM retains the right to dispute the amount and type of the
Assumed Tax Liabilities.
The IRS's withdrawal of the Proofs of Claim pursuant to this
stipulation will not provide a basis for New GM to challenge or
disclaim its assumption of the Assumed Tax Liabilities.
The parties reserve all of their rights with respect to any right
of setoff or counterclaims held by the U.S. Government pursuant
to Section 553 of the Bankruptcy Code or applicable law. Nothing
in the Parties' Stipulation will discharge, release or otherwise
preclude any valid right of setoff or recoupment that the U.S.
Government, its agencies, departments or agents may have.
The Debtors agree that pursuant to the Master Purchase Agreement,
they transferred to New GM their interest in the tax refund
action General Motors Corporation & Saturn Corporation v. United
States of America, No. 2:07-cv-14464-VAR-SDP, pending in the
United States District Court for the Eastern District of
Michigan, and disclaim an interest in any proceeds of the GM FICA
Action, whether those proceeds arise from a judgment in favor of
the plaintiffs or a settlement. Any proceeds arising out of the
GM FICA Action will accrue to New GM, and nothing in the Parties'
Stipulation will discharge, release, or otherwise preclude the
U.S. Government's Setoff and Recoupment Rights with respect to
those proceeds.
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 Sept. 30, 2010, GM had US$137.238 billion in total assets,
US$106.522 billion in total liabilities, US$6.998 billion in
preferred stock, US$971 million in non-controlling interest, and
US$23.718 billion in total 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. Garden City Group is the claims and notice
agent of the Debtors.
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)
GMX RESOURCES: BlackRock Discloses 4.94% Equity Stake
-----------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, BlackRock, Inc., disclosed that it
beneficially owns 2,588,950 shares of common stock of GMX
Resources Inc. representing 4.94% of the shares outstanding.
As of March 10, 2011, there were 56,415,790 shares of the
Company's common stock outstanding, including 2,640,000 shares
under a share lending agreement that will be returned to the
Company upon conversion or maturity of certain outstanding
convertible notes and 688,822 shares of unvested restricted stock.
About GMX Resources
GMX Resources Inc. -- http://www.gmxresources.com/-- is an
independent natural gas production company headquartered in
Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas &
Louisiana, 24 proved developed non-producing reservoirs, 48 proved
undeveloped locations and several hundred other development
locations. GMXR has 9,000 net acres on the Sabine Uplift of East
Texas. GMXR has 7 producing wells in New Mexico. The Company's
strategy is to significantly increase production, revenues and
reinvest in increasing production. GMXR's goal is to grow and
build shareholder value every day.
The Company reported a net loss of $138.29 million on
$96.52 million of oil and gas sales for the year ended Dec. 31,
2010, compared with a net loss of $181.08 million on $94.29
million of oil and gas sales during the prior year.
As reported by the Troubled Company Reporter on Feb. 4, 2011,
Standard & Poor's Ratings Services said it assigned its
preliminary 'B-' corporate credit rating to GMX Resources Inc.
The outlook is stable. "The ratings on Oklahoma City-based GMX
Resources Inc. reflect the company's limited scale of operations,
meaningful exposure to weak natural gas prices, a very aggressive
near-term spending plan, limited liquidity beyond 2011, and
elevated debt leverage," said Standard & Poor's credit analyst
Paul B. Harvey. Near-term credit quality will benefit from the
liquidity provided by GMX's proposed $200 million senior unsecured
note issuance and concurrent $100 million common equity offering,
as well as expectations for growing production from its
Haynesville Shale development.
HAMPTON ROADS: Incurs $211.34 Million Net Loss in 2010
------------------------------------------------------
Hampton Roads Bankshares, Inc. reported a net loss of $34.28
million on $28.58 million of interest income for the fourth
quarter ended Dec. 31, 2010, compared with a net loss of
$152.21 million on $34.80 million of interest income for the same
period during the prior year.
The Company also reported a net loss of $211.34 million on $122.20
million of interest income for the twelve months ended Dec. 31,
2010, compared with a net loss of $201.45 million on
$149.44 million of interest income during the prior year.
During the fourth quarter, the Company completed the remainder of
its $295 million capital raise, resulting in an additional
$60 million of equity capital during the quarter. "As one of the
few financial institutions successfully recapitalized in 2010, we
are pleased to have our capital raise completed," said John A. B.
"Andy" Davies, Jr., President and Chief Executive Officer. "This
is the beginning of a new era for the Company, its shareholders,
loyal customers and our team members."
A full-text copy of the press release announcing the financial
results is available for free at:
http://ResearchArchives.com/t/s?750a
About Hampton Roads Bankshares
Hampton Roads Bankshares, Inc. (NASDAQ: HMPR)
-- http://www.hamptonroadsbanksharesinc.com/-- is a bank holding
company that was formed in 2001 and is headquartered in Norfolk,
Virginia. The Company's primary subsidiaries are Bank of Hampton
Roads, which opened for business in 1987, and Shore Bank, which
opened in 1961. Currently, Bank of Hampton Roads operates twenty-
eight banking offices in the Hampton Roads region of southeastern
Virginia and twenty-four offices in Virginia and North Carolina
doing business as Gateway Bank & Trust Co. Shore Bank serves the
Eastern Shore of Maryland and Virginia through eight banking
offices and fifteen ATMs.
Yount, Hyde & Barbour, P.C., in Winchester, Va., 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 the year ended Dec. 31, 2009. The
independent auditors noted that quantitative measures established
by regulation to ensure capital adequacy require the Company and
its subsidiary banks to maintain minimum amounts and ratios of
total and Tier I capital to risk-weighted assets, and Tier I
capital to average assets. In addition, the Company has suffered
recurring losses from operations and declining levels of capital.
Hampton Roads Bankshares reported a net loss of $84.5 million on
$17.9 million of net interest income for the three months ended
Sept. 30, 2010, compared with a net loss of $13.4 million on
$26.5 million of net interest income for the same period last
year.
Effective June 17, 2010, the Company and its banking subsidiary,
Bank of Hampton Roads ("BOHR"), entered into a written agreement
with the Federal Reserve Bank of Richmond and the Bureau of
Financial Institutions of the Virginia State Corporation
Commission. The Company's other banking subsidiary, Shore Bank,
is not a party to the Written Agreement.
Under the terms of the Written Agreement, among other things, BOHR
agreed to develop and submit for approval plans to (a) strengthen
board oversight of management and BOHR's operations, (b)
strengthen credit risk management policies, (c) improve BOHR's
position with respect to loans, relationships, or other assets in
excess of $2.5 million which are now, or may in the future become,
past due more than 90 days, are on BOHR's problem loan list, or
adversely classified in any report of examination of BOHR, (d)
review and revise, as appropriate, current policy and maintain
sound processes for determining, documenting, and recording an
adequate allowance for loan and lease losses, (e) improve
management of BOHR's liquidity position and funds management
policies, (f) provide contingency planning that accounts for
adverse scenarios and identifies and quantifies available sources
of liquidity for each scenario, (g) reduce the Bank's reliance on
brokered deposits, and (h) improve BOHR's earnings and overall
condition.
The Company said in its Form 10-Q for the Sept. 30, 2010 quarter
that due to its financial results, the substantial uncertainty
throughout the U.S. banking industry, and the Written Agreement
the Company and BOHR have entered into, doubts existed regarding
the Company's ability to continue as a going concern through the
second quarter of 2010. However, management believes this concern
has been mitigated by the initial closing of the Private Placement
that occurred on Sept. 30, 2010.
HCA HOLDINGS: Registers Add'l 2.53MM Shares of Common Stock
-----------------------------------------------------------
HCA Holdings, Inc. disclosed in a Form S-1 filing with the U.S.
Securities and Exchange Commission that it intends to register
additional 2,530,000 shares of the Company's common stock. The
Company previously registered 142,600,000 shares of its common
stock at an aggregate offering price not to exceed $4,278,000,000
on Form S-1, which registration statement was declared effective
by the Securities and Exchange Commission on March 9, 2011.
About HCA Inc.
Headquartered in Nashville, Tennessee, HCA is the nation's largest
acute care hospital company with 162 hospitals and 104
freestanding surgery centers (including eight hospitals and eight
freestanding surgery centers that are accounted for using the
equity method) as of Sept. 30, 2010. For the twelve months
ended Sept. 30, 2010, the company recognized revenue in excess
of $30 billion.
The Company's balance sheet at Dec. 31, 2010 showed $23.85 billion
in total assets, $34.64 billion in total liabilities and
$10.79 billion in stockholders' deficit.
* * *
In November 2010, Moody's Investors Service confirmed the existing
ratings of HCA, including the 'B2' Corporate Family and
Probability of Default Ratings. Moody's assigned a Caa1 (LGD6,
96%) rating to HCA, Inc.'s proposed offering of $1.525 billion of
senior unsecured notes due 2021 to be issued at a parent holding
company.
HCA's 'B2' Corporate Family Rating anticipates that the company
will continue to operate with significant leverage. Pro forma for
the proposed debt financed distribution Moody's estimate that
adjusted leverage would have been 5.2 times at Sept. 30, 2010.
Furthermore, the company has large maturities in 2012 and 2013
that will likely need to be refinanced in the capital markets.
However, the rating acknowledges the company's progress in
systematically extending its maturity profile. Finally, the
rating reflects HCA's solid EBITDA growth, which has benefited the
credit metrics and demonstrated the company's ability to weather
industry pressures.
HCA HOLDINGS: Two Directors Do Not Own Any Securities
-----------------------------------------------------
In separate Form 3 filings with the U.S. Securities and Exchange
Commission, Jay O. Light and Geoffrey G. Meyers, directors at HCA
Holdings, Inc., disclosed that they do not own any securities of
the Company.
About HCA Inc.
Headquartered in Nashville, Tennessee, HCA is the nation's largest
acute care hospital company with 162 hospitals and 104
freestanding surgery centers (including eight hospitals and eight
freestanding surgery centers that are accounted for using the
equity method) as of Sept. 30, 2010. For the twelve months
ended Sept. 30, 2010, the company recognized revenue in excess
of $30 billion.
The Company's balance sheet at Dec. 31, 2010 showed $23.85 billion
in total assets, $34.64 billion in total liabilities and
$10.79 billion in stockholders' deficit.
* * *
In November 2010, Moody's Investors Service confirmed the existing
ratings of HCA, including the 'B2' Corporate Family and
Probability of Default Ratings. Moody's assigned a Caa1 (LGD6,
96%) rating to HCA, Inc.'s proposed offering of $1.525 billion of
senior unsecured notes due 2021 to be issued at a parent holding
company.
HCA's 'B2' Corporate Family Rating anticipates that the company
will continue to operate with significant leverage. Pro forma for
the proposed debt financed distribution Moody's estimate that
adjusted leverage would have been 5.2 times at Sept. 30, 2010.
Furthermore, the company has large maturities in 2012 and 2013
that will likely need to be refinanced in the capital markets.
However, the rating acknowledges the company's progress in
systematically extending its maturity profile. Finally, the
rating reflects HCA's solid EBITDA growth, which has benefited the
credit metrics and demonstrated the company's ability to weather
industry pressures.
As reported by the Troubled Company Reporter on March 14, 2011,
Moody's Investors Service commented that the completion of the IPO
by HCA Holdings, Inc., has no immediate impact on the company's B2
Corporate Family Rating. The outlook for the ratings remains
positive. While Moody's believes that the completion of the IPO
is a credit positive since proceeds are expected to be used to
repay outstanding debt, the estimated $2.6 billion of proceeds to
the company won't meaningfully reduce HCA's $28.2 billion debt
load.
HCA HOLDINGS: To Issue 87,719,300 Add'l Common Shares
-----------------------------------------------------
HCA Holdings, Inc. is offering an aggregate of 124 million shares
of common stock consisting of 87,719,300 shares of its common
stock to be offered by the Company, and 36,280,700 shares that may
be resold by existing shareholders. The Company will not receive
any proceeds from the sale of the shares by the selling
stockholders.
This is an initial public offering of the Company's common stock.
Since November 2006 and prior to this offering, there has been no
public market for the Company's common stock. The Company
currently expects the initial public offering price will be
between $27.00 and $30.00 per share. The Company has applied to
list the common stock on the New York Stock Exchange under the
symbol "HCA."
To the extent that the underwriters sell more than 124,000,000
shares of common stock, the underwriters have the option to
purchase up to an additional 18,600,000 shares from the selling
stockholders at the initial price to the public less the
underwriting discount.
About HCA Inc.
Headquartered in Nashville, Tennessee, HCA is the nation's largest
acute care hospital company with 162 hospitals and 104
freestanding surgery centers (including eight hospitals and eight
freestanding surgery centers that are accounted for using the
equity method) as of Sept. 30, 2010. For the twelve months
ended Sept. 30, 2010, the company recognized revenue in excess
of $30 billion.
The Company's balance sheet at Dec. 31, 2010 showed $23.85 billion
in total assets, $34.64 billion in total liabilities and
$10.79 billion in stockholders' deficit.
* * *
In November 2010, Moody's Investors Service confirmed the existing
ratings of HCA, including the 'B2' Corporate Family and
Probability of Default Ratings. Moody's assigned a Caa1 (LGD6,
96%) rating to HCA, Inc.'s proposed offering of $1.525 billion of
senior unsecured notes due 2021 to be issued at a parent holding
company.
HCA's 'B2' Corporate Family Rating anticipates that the company
will continue to operate with significant leverage. Pro forma for
the proposed debt financed distribution Moody's estimate that
adjusted leverage would have been 5.2 times at Sept. 30, 2010.
Furthermore, the company has large maturities in 2012 and 2013
that will likely need to be refinanced in the capital markets.
However, the rating acknowledges the company's progress in
systematically extending its maturity profile. Finally, the
rating reflects HCA's solid EBITDA growth, which has benefited the
credit metrics and demonstrated the company's ability to weather
industry pressures.
As reported by the Troubled Company Reporter on March 14, 2011,
Moody's Investors Service commented that the completion of the IPO
by HCA Holdings, Inc., has no immediate impact on the company's B2
Corporate Family Rating. The outlook for the ratings remains
positive. While Moody's believes that the completion of the IPO
is a credit positive since proceeds are expected to be used to
repay outstanding debt, the estimated $2.6 billion of proceeds to
the company won't meaningfully reduce HCA's $28.2 billion debt
load.
HEALTHY FAST: Recurring Losses Cue Going Concern Doubt
------------------------------------------------------
Healthy Fast Food, Inc., filed on March 10, 2011, its annual
report on Form 10-K for the fiscal year ended Dec. 31, 2010.
L.L. Bradford & Company, LLC, in Las Vegas, expressed substantial
doubt about the Company's ability to continue as a going concern.
The independent auditors noted that Company has incurred recurring
losses and lower-than-expected sales.
The Company reported a net loss of $663,783 on $2.6 million of
revenues for 2010, compared with a net loss of $2.4 million on
$1.3 million of revenues for 2009.
The Company's balance sheet at Dec. 31, 2010, showed $2.8 million
in total assets, $772,259 in total liabilities, and stockholders'
equity of $2.0 million.
A full-text copy of the Form 10-K is available for free at:
http://researcharchives.com/t/s?750c
Henderson, Nev.-based Health Fast Food, Inc., currently owns and
operates six U-Swirl Frozen Yogurt cafes in the Las Vegas
metropolitan area, and has six franchised locations in operation
in Reno and Henderson, Nevada, Meridian, Idaho, and Mesa and
Scottsdale, Arizona.
HEARTLAND AUTOMOTIVE: Quad-C Buys Connecticut Jiffy Lube Operator
-----------------------------------------------------------------
Dow Jones' DBR Small Cap reports that Heartland Automotive
Services Inc., the Jiffy Lube franchisee backed by Quad-C
Management Inc., has acquired Jiffy Lube service-center operator
Constitution Lube Inc.
Constitution Lube's service centers are located in Hartford, New
Haven and Fairfield, giving Heartland entry into a new market,
according to DBR. The report relates that the terms of the deal
weren't disclosed and mark a buying streak for the Irving, Texas-
based Heartland.
Last month Heartland purchased Empire Lube Inc., which operates
Jiffy Lubes in the New York City region, the report notes. Also
in February, DBR says that Heartland announced a deal to acquire
Texas Oil X-Change Inc., which operates quick-lube service centers
throughout the northern part of the state.
And in January, Heartland said it would acquire Nebraska Lube LLC,
which operates six service centers in Omaha and Lincoln. Heartland
operates more than 440 Jiffy Lube locations in the U.S., the
report adds.
About Heartland
Heartland is the largest franchisee of Jiffy Lube service center.
Quad-C bought the assets of Heartland out of bankruptcy in
February 2009.
Quad-C invests in buyouts, recapitalizations, and industry
consolidations of firms valued from $50 million to $500 million.
Its current portfolio includes interests Heartland Automotive (the
largest franchisee of Jiffy Lube service centers).
Heartland filed for Chapter 11 protection on Jan. 7, 2008 (Bank.
N.D. Tex. Lead Case No. 08-40057). Thomas E. Lauria, Esq.,
Patrick Mohan, Esq., Gerard Uzzi, Esq., and Lisa Thompson, Esq.,
at White & Case LLP; and Jeff P. Prostok, Esq., at Forshey &
Prostok, LLP, represented the Debtors in their restructuring
efforts. Cadwalader, Wickersham & Taft LLP, and Munsch, Hardt,
Kopf & Harr, PC represented the Official Committee of Unsecured
Creditors.
HERCULES OFFSHORE: Incurs $134.59 Million Net Loss in 2010
----------------------------------------------------------
Hercules Offshore, Inc., filed its annual report on Form 10-K with
the U.S. Securities and Exchange Commission reporting a net loss
of $134.59 million on $657.48 million of revenue for the year
ended Dec. 31, 2010, compared with a net loss of $91.73 million on
$742.85 million of revenue during the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $1.99 billion
in total assets, $1.14 billion in total liabilities and
$853.13 million in stockholders' equity.
John T. Rynd, Chief Executive Officer and President of Hercules
Offshore, stated, "Last year presented a number of significant
challenges for our company and the entire drilling industry that
stemmed from the Macondo incident, followed by the ensuing
regulatory uncertainties that still plague our business today. In
spite of these difficulties, our employees pulled together to
maintain the quality of our service and improve our safety
performance. During the fourth quarter of 2010 we generated
positive operating income, on an adjusted basis, for the first
time since the second quarter of 2009. These are significant
accomplishments under the current market conditions and I am very
proud of the entire Hercules team for their perseverance and
professionalism in an extremely difficult environment."
A full-text copy of the press release announcing the financial
results is available for free at:
http://ResearchArchives.com/t/s?750b
A full-text copy of the annual report on Form 10-K is available
for free at http://ResearchArchives.com/t/s?74f1
About Hercules Offshore
Hercules Offshore Inc. (NASDAQ: HERO) --
http://www.herculesoffshore.com/-- provides shallow-water
drilling and marine services to the oil and natural gas
exploration and production industry in the United States, Gulf of
Mexico and internationally. The Company provides these services
to integrated energy companies, independent oil and natural gas
operators and national oil companies. The Company operates in six
business segments: Domestic Offshore, International Offshore,
Inland, Domestic Liftboats, International Liftboats and Delta
Towing.
The Troubled Company Reporter reported on Nov. 17, 2010, that
Moody's Investors Service downgraded the Corporate Family Rating
of Hercules Offshore Inc. and the Probability of Default Rating to
'Caa1' from 'B2'. Moody's also downgraded Hercules' 10.5% senior
secured notes due 2017, its senior secured revolving credit
facility due 2012, and its senior secured term loan B due 2013,
all to Caa1 with LGD3, 45%. The outlook remains negative.
"The inability of Hercules to generate meaningful free cash flow
despite limited reinvestment in its aging fleet of rigs is cause
for concern," commented Stuart Miller, Moody's Senior Analyst.
"Without a significant de-leveraging of its balance sheet,
Hercules is following a path that could lead to financial hardship
at the first sign of a market softening." Hercules' Caa1 CFR
rating reflects its highly leveraged balance sheet and limited
ability to generate free cash flow. The Caa1 rating on the senior
secured notes reflects their pari passu secured position in
Hercules' capital structure relative to the senior secured credit
facilities.
HERCULES OFFSHORE: Pellegrin's Annual Salary Hiked to $250,000
--------------------------------------------------------------
On March 6, 2011, the Compensation Committee of the Board of
Directors of Hercules Offshore, Inc., approved an increase to the
annual base salary for Todd A. Pellegrin, Vice President,
Worldwide Liftboat Operations, from $216,000 to $250,000,
effective immediately. The Committee also approved modifications
to the target payouts in 2012 under the Company's Cash Performance
Incentive and Retention Plan for Stephen M. Butz, Senior Vice
President, Chief Financial Officer, and Treasurer, and Lisa W.
Rodriguez, Vice President, Human Resources, based upon their
respective annual base salaries. The target payout for Mr. Butz
was increased from $180,000 to $216,000, while the target payout
for Ms. Rodriguez was reduced from $349,200 to $180,000.
Also on March 6, 2011, the Committee approved equity grants for
certain of its executive officers. The Annual Equity Grants were
annual grants made by the Committee pursuant to the Company's
Policy Regarding the Granting of Equity-Based Compensation Awards,
which provides for approval by the Committee of annual equity
grants at its meeting during the first or second quarter of each
year.
The Annual Equity Grants were made pursuant to the Company's 2004
Long-Term Incentive Plan to each of John T. Rynd, Chief Executive
Officer and President, James W. Noe, Senior Vice President,
General Counsel and Chief Compliance Officer, Terrell L. Carr,
Vice President, Worldwide Operations, Mr. Butz, Mr. Pellegrin, and
Ms. Rodriguez. Each of the executive officers received restricted
stock awards, which vest 1/3 per year and have no performance
criteria, and performance-based restricted stock awards, which
vest 1/3 per year, subject to the achievement of company
performance objectives with respect to two metrics in 2011.
Threshold, target and stretch performance objectives have been
established for each metric, with the officer vesting 33% more
shares at the stretch level, 33% less shares at the threshold
level, with vesting pro rated between levels, and no shares will
be issued with respect to a particular metric if the threshold
performance objective is not met with respect to such metric. At
the target level, the restricted stock awards and the performance-
based stock awards are 44% and 56%, respectively, of the total
target grant. The number of shares issuable to each of the
executive officers if the target objectives are achieved with
respect to each metric is as set forth below:
Non-Performance Performance-Based Total
Name Based Grant Target Grant Target Grant
---- --------------- ----------------- ------------
John T. Rynd 93,026 118,026 211,052
Stephen M. Butz 55,815 70,815 126,630
James W. Noe 55,815 70,815 126,630
Terrell L. Carr 55,815 70,815 126,630
Lisa Rodriguez 22,326 28,326 50,632
Todd Pellegrin 27,908 35,408 63,316
About Hercules Offshore
Hercules Offshore Inc. (NASDAQ: HERO) --
http://www.herculesoffshore.com/-- provides shallow-water
drilling and marine services to the oil and natural gas
exploration and production industry in the United States, Gulf of
Mexico and internationally. The Company provides these services
to integrated energy companies, independent oil and natural gas
operators and national oil companies. The Company operates in six
business segments: Domestic Offshore, International Offshore,
Inland, Domestic Liftboats, International Liftboats and Delta
Towing.
The Company's balance sheet at Dec. 31, 2010 showed $1.99 billion
in total assets, $1.14 billion in total liabilities and $853.13
million in total stockholders' equity.
The Troubled Company Reporter reported on Nov. 17, 2010, that
Moody's Investors Service downgraded the Corporate Family Rating
of Hercules Offshore Inc. and the Probability of Default Rating to
'Caa1' from 'B2'. Moody's also downgraded Hercules' 10.5% senior
secured notes due 2017, its senior secured revolving credit
facility due 2012, and its senior secured term loan B due 2013,
all to Caa1 with LGD3, 45%. The outlook remains negative.
"The inability of Hercules to generate meaningful free cash flow
despite limited reinvestment in its aging fleet of rigs is cause
for concern," commented Stuart Miller, Moody's Senior Analyst.
"Without a significant de-leveraging of its balance sheet,
Hercules is following a path that could lead to financial hardship
at the first sign of a market softening." Hercules' Caa1 CFR
rating reflects its highly leveraged balance sheet and limited
ability to generate free cash flow. The Caa1 rating on the senior
secured notes reflects their pari passu secured position in
Hercules' capital structure relative to the senior secured credit
facilities.
HILLMAN GROUP: Moody's Assigns 'B3' Rating to $50 Mil. Notes
------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to The Hillman
Group, Inc.'s proposed $50 million add-on note offering and
affirmed its B2 corporate family and probability of default
ratings. Hillman expects to use proceeds to fund an acquisition,
and the transaction does not have a material impact on credit
metrics. Moody's also affirmed the Ba3 rating on the senior
secured bank credit facility, and the outlook remains stable.
Hillman intends to issue the notes under the same indenture as its
$150 million senior unsecured notes due 2018 (B3) and use proceeds
from the offering primarily to fund the acquisition of TagWorks,
LLC, as well as to pay down borrowings under its revolving credit
facility. The expected purchase price consists of a $40 million
upfront payment, along with an additional $12.5 million deferred
payment in October 2011, and a contingent earnout of $12.5 million
payable in 2012.
The transaction modestly reduces leverage on an immediate basis
due to Tagworks' strong earnings and the deferred nature of a
portion of the purchase price. The acquisition enhances Hillman's
footprint within the engraving business and brings strong
operating margins.
Moody's also lowered Hillman's speculative grade liquidity rating
to SGL-3 from SGL-2 reflecting somewhat weaker, albeit still
adequate, liquidity. The increase in debt adds approximately
$5 million annual cash interest, and the incremental $12.5 million
purchase payment to occur later this year will consume some
liquidity.
A summary of the actions:
The Hillman Group, Inc.
* Corporate Family Rating at B2;
* Probability of Default Rating at B2;
* Senior unsecured Notes due June 2018, Assigned B3;
* Senior secured revolving credit facility due May 2015 affirmed
at Ba3 (LGD2, 23%);
* Senior secured term loan due May 2016 affirmed at Ba3 (LGD2,
23%);
* Senior unsecured notes due June 2018 affirmed at B3 (LGD5, 71%);
* Speculative grade liquidity rating, lowered to SGL-3 from SGL-2
Ratings Rationale
High leverage (approaching 7 times debt-to-EBITDA pro forma for
the transaction and including the addition of Tagworks) drives
Hillman's B2 corporate family rating, which also incorporates low
tangible asset coverage and modest size. Notwithstanding Moody's
expectation for modestly positive free cash flow generation,
Moody's believe Hillman's growth orientation limits the potential
for material intermediate term debt reduction. The company's
leading market position, strong margins, and established
relationships with a diverse customer base support the rating.
Furthermore, the replenishment nature and low price point of its
products limits the company's susceptibility to changes in
discretionary consumer spending and provides relative earnings
stability.
The stable outlook reflects Moody's expectation for modest revenue
growth and positive free cash flow generation. Notwithstanding
concerns over increases in input costs, Moody's expects Hillman to
exhibit some EBITDA growth in 2011, benefiting from the recent
acquisitions of Tagworks and Servalite.
Sustained erosion in operating margins, sustained negative free
cash flow, material debt funded acquisitions, or deterioration of
liquidity could negatively impact the B2 rating. Specifically,
leverage sustained above 7.5 times debt-to-EBITDA could result in
a downgrade.
The magnitude of improvement in credit metrics required to sustain
a higher rating and somewhat aggressive fiscal policy constrain
upward momentum. An upgrade is unlikely absent an equity funded
acquisition or contribution used to paydown that materially
improved the credit profile. Specific metrics required for a
higher rating include debt to EBITDA below 4.5 times and free cash
flow to debt approaching 10%.
The Hillman Companies, Inc., provides hardware-related products
and related merchandising services to retail markets in North
America. Revenue for the twelve months ended September 30, 2010,
approximated $456 million.
HILLMAN GROUP: S&P Affirms 'CCC+' Rating on Senior Unsec. Debt
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its
'CCC+' senior unsecured debt rating for Cincinnati, Ohio-based The
Hillman Group Inc.'s proposed $50 million senior notes due June 1,
2018. The proposed note issuance is an add-on to the existing
$150 million 10.875% senior notes due June 1, 2018. The recovery
rating remains '6', indicating expectations for minimal (0 to 10%)
recovery in the event of default.
Hillman has stated it will use the proceeds from these notes to
pay for its acquisition of TagWorks, L.L.C., and repay borrowings
under its credit facility. The company has entered into an
agreement to acquire TagWorks for an initial purchase price of
$40 million in cash upon closing and will pay an additional amount
of $12.5 million on October, 31, 2011. TagWorks is a provider of
pet tags to Petsmart using a unique technology and will expand the
company's existing pet tag business. The transaction is subject
to Hillman's ability to raise adequate financing and is expected
to close in March 2011. On a pro forma basis, S&P expects debt to
EBITDA leverage to increase slightly, but remain in the mid-6x
area.
The ratings on Hillman reflect the company's financial risk
profile, which S&P characterize to be highly leveraged reflecting
the company's aggressive financial policy, high leverage and thin
coverage metrics. In addition, S&P views the company's business
risk profile is weak, particularly given its narrow business focus
and high concentration among its leading customers. However, the
company benefits from generally steady demand for its lower price-
point hardware and related products.
The 'B' corporate credit rating on Hillman Group remains
unchanged.
Ratings List
Hillman Group Inc. (The)
Corporate credit rating B/Stable/--
Rating Affirmed
$200 mil. sr unsec debt due 2018 CCC+
Recovery 6
HOLLIFIELD RANCHES: Court Approves Garald Price as Accountant
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Ohio authorized
Hollifield Ranches Inc. to employ Garald Price & Associates PA as
its accountant.
The firm will:
a) establish a bookkeeping system which complies with the order
of this Court in relationship to accounting procedures;
b) prepare and file the Debtor's income tax returns for current
and previous years, and prepare any returns required to be
filed during the pendency of this Chapter 11 bankruptcy; and
c) perform any other accounting services necessary or required
by the debtor in the operation of its business, and to
ensure compliance with the operating guidelines established
for a Chapter 11 bankruptcy.
The firm will charge the Debtor based on its hourly rates:
Services Hourly Rates
-------- ------------
Accounting $112
Tax preparation $128
Mr. Garald Price charges $80.00 per hour for bookkeeping; $65 per
hour for accounting services, $75 per hour for tax preparation and
$50 per hour for bookkeeping for Mr. Price's assistant.
About Hollifield Ranches, Inc.
Hansen, Idaho-based Hollifield Ranches, Inc., filed for Chapter 11
bankruptcy protection on September 9, 2010 (Bankr. D. Idaho Case
No. 10-41613). Brent T. Robinson, Esq., in Rupert, Idaho,
represents the Debtor. The Debtor estimated assets and debts at
$10 million to $50 million as of the Chapter 11 filing.
Robert D. Miller, Jr. ,the United States Trustee for Region 18,
has appointed three creditors to serve as members of the Unsecured
Creditors' Committee in the Chapter 11 case of Hollifield Ranches,
Inc. J. Justin May, Esq., at May, Browning & May represents the
Official Committee of Unsecured Creditors.
HOTEL SOLUTIONS: Dumoulin Unit Wants US Recognition of CCAA Case
----------------------------------------------------------------
Quebec, Canada-based Dumoulin Solutions Inc., and its units
commenced on Feb. 22, 2011 in the District of Montreal, Province
of Quebec under the Companies' Creditors Arrangement Act.
Dumoulin is the largest Canadian-owned and operated retailer of
electronics, computers, cameras, communication and gaming
products. Dumoulin currently operates 15 corporate retail
locations situated in the provinces of Quebec and Ontario and has
90 franchise locations across Canada operating under the
"Dumoulin" (in Quebec) or "Audiotronic" (outside Quebec) banners.
It has 343 employees working in its corporate retail stores, head
office and warehouses.
Hotel Solutions USA, Inc., a unit of Doumulin, filed a Chapter 15
petition in Dallas, Texas, on March 10, 2011. Hotel Solutions
estimated assets and debts of $1 million to $10 million as of the
Chapter 15 filing.
Hotel Solutions seeks the U.S. Court's recognition of the
voluntary reorganization proceeding (Case No. 500-11-040345-114)
that the company, its parent, and its affiliates Dumoulin Electric
Group Inc., and Dumoulin Franchise Management Inc., commenced on
Feb. 22, 2011, in the District of Montreal, Province of Quebec
under the Companies' Creditors Arrangement Act.
Michel Levasseur, chief financial officer of Hotel Solutions,
relates in a court filing that over the last few years, the
Dumoulin Entities shifted their primarily retail business model to
one which included a sizeable business-to-business component and
growing cross-border activities. The Dumoulin Entities, through
the Debtor, have developed business as a key supplier of flat
panel televisions, mounting brackets and other electronics in the
Canadian and United States' hospitality markets. The Debtor's
primary customers are large hotel operators and developers.
The Bank of Montreal is owe C$4,820,000 under a credit facility
provided to the Dumoulin Entities. Ingram Micro Inc., which
provides inventory management services to the Debtor, is owed
$1,752,463. Various trade suppliers are owed a total of
$22,851,984.
"Over the past three years, the Debtor's financial performance
has suffered due to declining prices on some key products,
declining sales volume, and reductions of financing.
Additionally, the Debtor has been impacted by the 2008 and 2009
recession," Mr. Levasseur explains.
The Debtor asks the U.S. Court to recognize that the CCAA
proceedings "as the foreign main proceeding". It also filed an
emergency motion with the U.S. Court to enforce the automatic stay
pending the determination of the verified petition for
recognition.
The Debtor is defendant to a lawsuit by Samsung (D. N.J. Case No.
2:10-cv-05819-KSH) seeking injunctive relief against the Debtor's
assets located in the United States. The Debtor has also received
a notice of repossession from Ingram Micro Inc. Worldwide
Sourcing Solutions, Inc., a unit of Wyndham Worldwide Corporation,
also wants to terminate a sourcing agreement.
Dominic Deslandes, on behalf of Raymond Chabot Inc., the foreign
representative, signed the petition. Raymond Chabot, a Canadian
restructuring firm, is the monitor appointed in the CCAA cases.
HOTEL SOLUTIONS: Chapter 15 Case Summary
----------------------------------------
Chapter 15 Debtor: Hotel Solutions USA, Inc.
2130, Dagenais Boulevard West
Laval, Quebec H7L 5X9
Canada
Chapter 15 Case No.: 11-31691
Chapter 15 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Harlin DeWayne Hale
About the Debtor: The Debtor is an electronics retailer based in
Canada that provides solutions to hotels who
want to upgrade their audio/video products.
Quebec, Canada-based Dumoulin Solutions Inc.,
and its units, including Hotel Solutions,
commenced on Feb. 22, 2011 in the District of
Montreal, Province of Quebec under the
Companies' Creditors Arrangement Act.
Debtor's Counsel: Holland N. O'Neil, Esq.
Michael S. Haynes, Esq.
GARDERE,WYNNE AND SEWELL
1601 Elm Street, Suite 3000
Dallas, TX 75201
Tel: (214) 999-4961
Fax: (214) 999-4667
E-mail: honeil@gardere.com
mhaynes@gardere.com
Foreign
Representative: Dominic Deslandes, on behalf of Raymond Chabot
Inc., the monitor appointed in the CCAA cases.
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
HRAF HOLDINGS: Wants Plan Exclusivity Extended Until Sept. 4
------------------------------------------------------------
HRAF Holdings LLC and Harbor Real Asset Fund LP ask the U.S.
Bankruptcy Court for the District of Utah to extend their
exclusive period to solicit acceptances of their Chapter 11 plan
of reorganization from March 7, 2011, to Sept. 4, 2011.
A hearing is set for April 26, 2011, at 11:00 a.m., to consider
the Debtors request for extension. Objections, if any, are due
March 17, 2011.
The Debtors tell the Court that there is cause exists to extend
the exclusive period in that, among other things, they and their
largest creditor, Bank of America, N.A., have been engaged in
complicated, serious, good faith negotiations regarding the terms
of the Debtors' joint plan of reorganization and the bank's
treatment thereunder. These negotiations are ongoing. To date,
however, the negotiations neither have resulted in a stipulated
plan, nor have the negotiations resulted in stalemate or failure.
Once the negotiations conclude, whether in success or failure, the
Debtors anticipate filing an amended plan and amended disclosure
statement, and proceeding with the plan confirmation process.
However, Bofa believes that the requested extension of 180 days is
excessive and that, under the present circumstances, particularly
in light of the fact that the negotiations are mature and nearing
either a mutual agreement or an impasse, an extension of the
exclusive period of 120 days would be more than adequate to
accomplish the Debtors' objectives in these cases. Accordingly,
BofA objects to the Debtors' joint motion and, proposes, in the
alternative, that a more limited extension of 120 days be
authorized by the Court.
David E. Leta, Esq, at Snell & Wilmer, represents the bank.
According to the Troubled Company Reporter on Sept. 23, 2010, the
Debtor have filed a Joint Plan of Reorganization and disclosure
statement with the Court.
Through the Plan, the Debtors propose to repay creditors in full
with the proceeds of the liquidation of its real estate portfolio.
The Debtors propose to liquidate their remaining real estate
holdings in an orderly process designed to maximize returns to all
stakeholders. The Debtors will pay Bank of America, N.A., in full
not less than two years after the effective date of the Plan.
Other secured creditors will be paid in full not less than three
years after the effective date.
With respect to the holders of unsecured claims, the Debtors have
proposed to immediately pay certain relatively small claims (less
than $3,000) 80% of the face amount of the claims. Other holders
of unsecured claims will be paid in full under the Plan not later
than the end of the final sales period.
Copies of the Plan and disclosure statement are available for free
at:
http://bankrupt.com/misc/HRAF_HOLDINGS_plan.pdf
http://bankrupt.com/misc/HRAF_HOLDINGS_ds.pdf
Midvale, Utah-based HRAF Holdings, LLC, filed for Chapter 11
bankruptcy protection on September 9, 2010 (Bankr. D. Utah Case
No. 10-32433).
Affiliate Harbor Real Asset Fund L.P. filed for Chapter 11
bankruptcy protection on September 9, 2010 (Bankr. D. Utah Case
No. 10-32436).
The two cases are consolidated and jointly administered under the
case of HRAF.
George B. Hofmann, Esq., at Parsons Kinghorn & Harris, assists the
Debtors in their restructuring efforts. The Debtors estimated
their assets and debts at $10 million to $50 million each, as of
the Petition Date.
HUME BANK: Former President Sentenced to Six Years in Jail
----------------------------------------------------------
The Associated Press reports that the former president of Hume
Bank in Bates County will go to prison for a fraud scheme that
pushed the bank into insolvency.
The AP relates that Jeffrey W. Thompson was sentenced on March 9
in federal court to six years, six months in prison without
parole. He also was ordered to forfeit $300,000, or his home.
He pleaded guilty last October, the AP adds.
According to the AP, Mr. Thompson admitted in his plea that for
more than three years he covered up the fraud by lying to bank
regulators about problem loans and altering bank records.
Due mostly to bad loans originated by Mr. Thompson, the AP says,
the bank was declared insolvent and closed in March 2008. The
Federal Deposit Insurance Corp. insurance fund lost $4.3 million.
On March 7, 2008, Hume Bank, in Hume, Missouri, was closed by the
Missouri Division of Finance and the Federal Deposit Insurance
Corporation was named receiver.
IMPLANT SCIENCES: Restates 2010 Financials Due to Errors
--------------------------------------------------------
Implant Sciences Corporation filed an amendment its Quarterly
Report on Form 10-Q for the quarter ended March 31, 2010,
initially filed with the Securities and Exchange Commission on
May 19, 2010, to restate its consolidated financial statements at,
and for the three and nine months ended March 31, 2010 and the
notes related thereto and the related sections of the Management's
Discussion and Analysis of Financial Condition and Results of
Operations.
On Oct. 14, 2010, the Audit Committee of the Company's Board of
Directors, in consultation with the Company's management,
determined that the condensed consolidated financial statements
included in the Company's Quarterly Report on Form 10-Q for the
fiscal quarters ended Sept. 30, 2009, Dec. 31, 2009 and March 31,
2010 should no longer be relied on due to issues raised by the
Company's independent accountants, Marcum LLP, regarding errors in
the Company's adoption of Accounting Standards Codification 815-
40-15 "Derivatives and Hedging" related to the non-cash accounting
treatment of financial instruments which are not deemed to be
indexed to the Company's common stock. ASC 815-40-15 requires
issuers to record, as liabilities, financial instruments that
provide for reset provisions as an adjustment mechanism to the
relevant exercise or conversion price, since they are not deemed
to be indexed to the Company's common stock. Further, the Company
is restating the aforementioned quarters to record, as of July 1,
2009 and August 31, 2009, the commitment dates of the Company's
Series F Convertible Preferred Stock, to record the deemed
dividend resulting from the beneficial conversion feature
contained in the Series F Convertible Preferred Stock.
On Dec. 10, 2008, the Company entered into a note and warrant
purchase agreement with DMRJ Group LLC, pursuant to which the
Company issued a senior secured convertible promissory note in the
principal amount of $5,600,000 and a warrant to purchase 1,000,000
shares of the Company's common stock. The promissory note and
warrant were each amended and restated as of March 12, 2009. Both
the promissory note and the warrant contain reset provisions, in
the event that the Company issue additional shares of common stock
at a price below the amended conversion price then in effect, the
conversion price of the promissory note and the exercise price of
the warrant will be automatically adjusted to equal the price per
share at which such shares are issued or deemed to be issued. The
Company determined that the conversion option and the warrant
derivative liability should initially and subsequently be measured
at fair value with changes in fair value recorded in earnings in
each reporting period and will record a cumulative-effect
adjustment to the opening balance of accumulated deficit at
July 1, 2009.
On July 1, 2009, the Company adopted the provisions of ASC 815-40-
15. In accordance with ASC 815-40-15, the cumulative effect of
the change in accounting principle recorded by the Company in
connection with a warrant to purchase shares of the Company's
common issued to DMRJ and the reset provision contained in the
senior secured promissory note the Company issued to DMRJ, was
recorded as an adjustment of the opening balance of accumulated
deficit. Upon adoption of ASC 815-40-15 at July 1, 2009, the
Company recorded a fair value note conversion option liability of
$1,183,000 resulting in a $802,000 adjustment to the opening
balance of accumulated deficit
On July 1, 2009, in connection with the issuance of the $1,000,000
senior secured promissory note, the Company also issued 871,763
shares of the Company's Series F Convertible Preferred Stock to
DMRJ, and agreed that, if the Company were unable to obtain net
proceeds of at least $3,000,000 from the issuance of debt or
equity securities by Aug. 31, 2009, the Company would issue
774,900 additional shares of Series F Preferred Stock to DMRJ.
DMRJ later extended this deadline until Oct. 1, 2009. The Company
did not satisfy this requirement and issued such additional shares
to DMRJ. In accordance with Accounting Standards Codification
470-20 "Debt", a conversion feature is beneficial, or "in the
money," when the conversion rate of the convertible security is
below the market price of the underlying common stock. The
beneficial conversion feature is treated as a deemed dividend to
the preferred shareholders.
The Company's management identified a deficiency in the Company's
internal controls over financial reporting, specifically in the
Company's controls over the adoption of Accounting Standards
Codification 815-40-15 - "Derivatives and Hedging." related to the
non-cash accounting treatment of financial instruments which are
not deemed to be indexed to the Company's common stock. Further,
the Company is restating the aforementioned quarters to record, as
of July 1, 2009 and Aug. 31, 2009, the commitment dates of the
Company's Series F Convertible Preferred Stock, the deemed
dividend resulting from the beneficial conversion feature
contained in the Series F Convertible Preferred Stock, as required
under Accounting Standards Codification 470-20 "Debt." As a
result of this material weakness, the Company's Chief Executive
Officer and Chief Financial Officer, concluded that, the Company
did not maintain effective internal control over financial
reporting as of March 31, 2010 and further concluded that, as of
such date, the Company's disclosure controls and procedures were
not effective at the reasonable assurance level. A material
weakness is a deficiency, or combination of control deficiencies,
in internal control over financial reporting, such that there is a
reasonable possibility that a material misstatement of the
Company's annual or interim financial statements will not be
prevented or detected on a timely basis.
The Company's restated statement of operations showed net income
of $3.53 million on $728,000 of revenue for the three months ended
March 31, 2010, compared with net loss of $2.04 million on
$728,000 of revenue as originally reported.
The Company's balance sheet at March 31, 2010 showed $6.22 million
in total assets, $28.05 million in total liabilities, $5 million
in commitments and contingencies, $26.83 million in total
stockholders' deficit, as compared with $6.22 million of total
assets, $15.34 million in total liabilities, $5 million in
commitments and contingencies, and $14.12 million in total
stockholders' deficit.
A full-text copy of the Quarterly Report as restated is available
for free at http://ResearchArchives.com/t/s?74ef
About Implant Sciences
Implant Sciences Corporation (OBB: IMSC.OB) --
http://www.implantsciences.com/-- develops, manufactures and
sells sensors and systems for the security, safety and defense
(SS&D) industries.
The Company's balance sheet at June 30, 2010 showed $4.96 million
in total assets, $30.10 million in total liabilities and $25.14
million in total stockholders' deficit.
The audit report issued by the Company's independent registered
public accounting firm issued on the Company's audited financial
statements for the fiscal year ended June 30, 2010 contains a
qualification regarding the Company's ability to continue as a
going concern. This qualification indicates there is substantial
doubt on the part of the Company's independent registered public
accounting firm as to its ability to continue as a going concern
due to the risk that the Company may not have sufficient cash and
liquid assets at June 30, 2010, to cover the Company's operating
capital requirements for the next twelve-month period and if
sufficient cash cannot be obtained the Company would have to
substantially alter its operations, or it may be forced to
discontinue operations.
INNKEEPERS USA: Lehman, Five Mile to Lead May 2 Auction
-------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
Innkeepers USA Trust won permission hold an auction where the
first bid to acquire all but seven of the 72 properties will be
made by Lehman Ali Inc. and Five Mile Capital Partners LLC.
Competing bids are due by April 25, in advance of the auction on
May 2. A competing bid must have an equity component of at least
$356.2 million.
According to Mr. Rochelle, to obviate objection from preferred
shareholders, the buyout proposal was modified last week to drop
seven hotels from those the buyers would acquire when a Chapter 11
plan is confirmed. There will be an auction to test if there is a
better bid.
Mr. Rochelle adds that the buyers sweetened the offer just before
the hearing by eliminating a $7 million breakup fee if someone
else wins the auction.
Early in the case, the bankruptcy judge refused to approve a
proposal where equity in reorganized Innkeepers would have been
shared by Lehman and Apollo Investment Corp., Innkeepers' current
owner. The original plan was opposed by the trustee for holders of
$825 million in secured debt against 45 hotels.
Five Mile-Lehman Plan
As reported in the Jan. 25, 2011 edition of the Troubled Company
Reporter, the Debtor filed a Chapter 11 plan based where Five Mile
Capital Partners and Lehman Ali Inc. would bankroll Innkeepers'
exit and turn the Company over to creditors, absent higher and
better offers.
According to Mr. Rochelle, Innkeepers hashed out a revised plan as
during the past two weeks with help from conferences with U.S.
Bankruptcy Judge Shelley C. Chapman. The new reorganization plan,
to be filed in April, is designed to satisfy most objections from
the creditors' committee and preferred shareholders. Under the
new proposal, as with the prior version from January, Lehman Ali
Inc. and Five Mile Capital Partners LLC will acquire the new
equity, assuming no better bid appears at auction.
According to Mr. Rochelle, the terms of the revised plan are:
* Lehman and Five Mile no longer will be buying seven hotel
properties. Those hotels will be dealt with through a
separate Chapter 11 plan.
* The preferred shareholders will be free to craft a separate
plan for the seven hotels that aren't subject to the blanket
mortgages that Lehman and Midland Loan Services Inc. have on
the 65 other properties. Preferred shareholders had objected
that the prior version of the plan would have forced them to
take $5.9 million cash in exchange for their shares. They
claimed that there was more equity in the seven hotels.
* As in January, Five Mile and Lehman Ali, a subsidiary of
Lehman Brothers Holdings Inc., together will provide
$174.1 million of equity capital and convert $200.3 million of
Lehman's debt into equity. Five Mile is the provider of
$53 million in secured financing for the Chapter 11 case, and
Lehman is the holder of $238 million in floating-rate
mortgages on 20 of Innkeepers' 72 properties.
* Midland, as servicer for $825 million of fixed-rate mortgage
debt on 45 properties, will emerge from Chapter 11 with
mortgages for $622.5 million on revised terms.
* As before, Lehman is to receive 50 percent of the new
equity plus $26.2 million cash in exchange for all its debt.
The secured loans for the Chapter 11 case will be paid in
full. For its equity contribution, Five Mile is to have the
other half of the new equity.
* Unsecured creditors previously were offered $2.5 million in
cash in return for voting in favor of the plan. To garner
their support, the pot was increased to $3.75 million so
unsecured creditors can recover as much as 65 percent. Secured
lenders' deficiency claims won't participate in the
distribution to unsecured creditors. Also, preference suits
against unsecured creditors will be waived.
* Apollo Investment Corp., Innkeepers' current owner, is to
receive releases of claims from the company and creditors in
return for supplying $375,000 of the pot for unsecured claims.
An auction will be held in about two months to test whether there
is a better offer for the 65 hotels. The change of ownership
after the auction would take place when a Chapter 11 plan is
confirmed for the properties. Innkeepers says the transaction for
the 65 hotels is valued at $971 million, including $622.5 million
in debt and $348.2 million of equity.
With Lehman and Midland, the plan is supported by holders of more
than $1 billion of $1.29 billion of pre-bankruptcy secured debt.
If someone else bids at auction, the offer must contain enough
cash so Lehman is paid at least $200.3 million in cash.
Any competing bid must be at least $363.2 million in cash, to take
advantage of the Midland financing and cover all the items in the
Lehman-Midland sponsored plan, plus an overbid.
About Innkeepers USA Trust
Innkeepers USA Trust is a self-administered Maryland real estate
investment trust with a primary business focus on acquiring
premium-branded upscale extended-stay, mid-priced limited service,
and select-service hotels.
Innkeepers, through its indirect subsidiaries, owns and operates
an expansive portfolio of 72 upscale and mid-priced extended-stay
and select-service hotels, consisting of approximately 10,000
rooms, located in 20 states across the United States.
Apollo Investment Corporation acquired Innkeepers in June 2007.
Innkeepers USA Trust and 91 affiliates filed for Chapter 11 on
July 19, 2010 (Bankr. S.D.N.Y. Case No. 10-13800). Paul M. Basta,
Esq., at Kirkland & Ellis LLP, in New York; Anup Sathy, P.C.,
Esq., Marc J. Carmel, Esq., at Kirkland & Ellis in Chicago; and
Daniel T. Donovan, Esq., at Kirkland & Ellis in Washington, DC,
serve as counsel to the Debtors. AlixPartners is the
restructuring advisor and Marc A. Beilinson is the chief
restructuring officer. Moelis & Company is the financial advisor.
Omni Management Group, LLC, is the claims and notice agent.
Attorneys at Morrison & Foerster, LLP, represent the Official
Committee of Unsecured Creditors.
The Company's consolidated assets for 2009 totaled approximately
$1.5 billion. As of July 19, 2010, the Company and its affiliates
have incurred approximately $1.29 billion of secured debt.
INTRACOASTAL HOSPITALITY: Water Club Seeks Ch. 11 Amid Eviction
---------------------------------------------------------------
Nadege Charles, writing for The Miami Herald, reported that The
Water Club restaurant in North Miami Beach closed after filing for
Chapter 11 bankruptcy protection on Feb. 4 -- two days before the
restaurant served its last dinners. Court records show The Water
Club was facing eviction proceedings for not paying rent before it
declared bankruptcy.
According to state records, the restaurant is owned by private
investment firm Intracoastal Hospitality LLC.
According to the Miami Herald, nearly a month later, former
employees say they haven't received their last paychecks and no
one from the restaurant will return their calls because the number
has been disconnected.
According to the report, court documents filed by the landlord
claims the restaurant owe $316,574 in unpaid rent.
The report recounts that the sprawling 42,000-square-foot, indoor-
outdoor waterfront restaurant opened with a buzz in May 2010, with
Top Chef competitor Andrea-Curto Randazzo and her husband Frank
Randazzo at the helm in the kitchen. The Randazzos left in
January.
The case is In Re Intracoastal Hospitality LLC (Bankr. S.D. Fla.
Case No. 11-13069). A copy of the petition is available at
http://bankrupt.com/misc/flsb11-13069.pdf
IPICO INC.: Ontario Court OKs Interim Loan Facility
---------------------------------------------------
IPICO Inc. reported that the Ontario Superior Court of Justice has
approved the terms of the interim loan facility negotiated with
Trilon Bancorp Inc., an affiliate of Brookfield Asset Management
Inc., in connection with IPICO's proposal to its creditors
pursuant to the Bankruptcy and Insolvency Act (Canada) referred to
in its news release of February 18, 2011. The Company is now
utilizing the interim loan facility to carry on its business
during the proposal proceedings. The Company also reported that
its creditors have approved the Company's proposal, including a
reorganization of its debts and capital structure and that the
Company will now seek Court approval of the proposal as soon as
possible.
ISLAND ONE: Panel Taps Bush Ross as Bankruptcy Counsel
------------------------------------------------------
The Official Committee of Unsecured Creditors of Island One, Inc.,
Crescent One, LLC, St. Croix One, LLC, Island One Resorts
Management Corporation, Navigo Vacation Club, Inc., and IOI
Funding I, LLC, has hired Bush Ross, P.A. as its general
counsel.
On Feb. 22, 2011, the Court granted the Committee's motion for an
order clarifying the order approving Bush Ross' employment.
Pursuant to the Clarifying Order, the Debtors are authorized to
pay Bush Ross an amount not to exceed 70% of its fees and 100% of
its costs as they accrue on a monthly basis, which amounts will be
subject tin all respects to the terms of any cash collateral
orders or budgets previously approved by the Court.
About Island One
Orlando, Florida-based Island One, Inc., filed for Chapter 11
bankruptcy protection on September 10, 2010 (Bankr. M.D. Fla. Case
No. 10-16177). Tiffany D. Payne, Esq., Elizabeth A. Green, Esq.,
and Jimmy D. Parrish, Esq., at Baker & Hostetler LLP, in Orlando
Fla., represent the Debtors as counsel. In its schedules, the
Debtor disclosed $155,100,767 in assets and $310,897,452 in
liabilities.
IOI Funding I, LLC, a debtor-affiliate, filed for Chapter 11
bankruptcy protection (Bankr. M.D. Fla. Case No. 10-16189) on
Sept. 10, 2010. The Debtor disclosed total assets of $9,230,309,
and total liabilities of $7,265,160.
The Official Committee of Unsecured Creditors in the Chapter 11
cases of Island One, Inc. has tapped Adam Lawton Alpert, Esq., a
shareholder, and Bush Ross, P.A. as its general counsel.
JAG MANAGEMENT: Case Summary & 3 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: JAG Management LP
217 Plugh Road
Butler, PA 16001
Bankruptcy Case No.: 11-21435
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
Western District of Pennsylvania (Pittsburgh)
Judge: Thomas P. Agresti
Debtor's Counsel: Marvin Leibowitz, Esq.
MARVIN LEIBOWITZ AND ASSOCIATES
619 Corporate Center
One Bigelow Square
Pittsburgh, PA 15219
Tel: (412) 391-1191
Fax: (412) 391-5244
E-mail: marvleibo@yahoo.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 three largest unsecured creditors filed
together with the petition is available for free at:
http://bankrupt.com/misc/pawb11-21435.pdf
The petition was signed by Jeffrey A. Garbinski, president.
Debtor-affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Jeffrey A. and Lynn Garbinski 11-21160 03/02/11
JAISUEL CONTRACTOR: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------------
Debtor: Jaisuel Contractor & Electrical Corp
P.O. Box 1410
Aguada, PR 00602
Tel: (787) 823-2175
Bankruptcy Case No.: 11-02077
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Luis E. Correa Gutierrez, Esq.
FIRSTBANK PUERTO RICO
P.O. Box 194089
San Juan, PR 00919
Tel: (787) 296-9500
Fax: (787) 296-9510
E-mail: lcorrea@lvvlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Carlos Moreno Gonzalez, president.
The list of unsecured creditors filed together with its petition
contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Banco Popular de PR Bank Loan $850,000
c/o Lcda. Gina H. Ferrer
P.O. Box 2342
Mayaguez, PR 00681
JEFFERSON COUNTY: Outlines Strategy to Address $3.2 Billion Debt
----------------------------------------------------------------
Matthew Bigg of Reuters and Jeff Roberts of Reuters Legal reported
that Alabama's Jefferson County has a plan to put its fiscal house
in order. According to the report, county officials said the plan
involves convincing creditors including JP Morgan Chase that the
plan has a chance of success and can be used as leverage as the
county seeks to refinance its $3.2 billion debt.
According to Reuters, the county's new strategy includes these
elements:
-- Hiring a consulting firm, likely FTI Consulting, with a
view to preparing a turnaround plan.
-- County finance director Jeff Hager is conducting audits
for its 2008 and 2009 finances. A 2010 audit will start
later this year. Audits are an essential prerequisite to
any deal with creditors since they provide transparency.
-- Last year, a federal court appointed water executive John
Young as the 'receiver' of the county's sewer system.
Mr. Young is seeking ways to cut costs and maximize
revenue from the sewer system. This will include an
increase to sewer rates.
-- The county is looking for ways to slash its overall
spending in a bid to address its General Fund debt.
-- The county is hiring a manager charged with running its
general operations.
-- For months, local business leaders have worked behind the
scenes to keep lines of communication with creditors open.
According to Reuters, county officials said one likely obstacle is
that creditors are disunited and represent divergent interests,
but even so there are grounds for optimism.
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000. It ended its 2006 fiscal year with a
$42.6 million general fund balance, according to Standard &
Poor's.
Jefferson County is trying to restructure $3.2 billion in sewer
debt. A bankruptcy by Jefferson County stands to be the largest
municipal bankruptcy in U.S. history. It could beat the record of
$1.7 billion set by Orange County, California in 1994.
In September 2010, Alabama Circuit Court Judge Albert Johnson
named John S. Young Jr. LLC as receiver for the sewer system.
* * *
In August 2010, Standard & Poor's Ratings Services withdrew its
underlying rating on Jefferson County, Ala.'s series 2001B general
obligation warrants. S&P lowered the SPUR to 'D' from 'B' on
Sept. 24, 2008, due to the county's failure to make a principal
payment on the bank warrants due Sept. 15, 2008, in accordance
with the terms of the Standby Warrant Purchase Agreement.
The county and the banks entered into a forbearance agreement that
effectively delayed payments due under the SWPA.
In January 2011, American Bankruptcy Institute reported that
officials from debt-laden Jefferson County were scheduled to meet
with representatives from PricewaterhouseCoopers and Alvarez &
Marsal, the first step in a nationwide search for a financial
turnaround firm.
JEFFERSON COUNTY: Ending Jobs Tax May Force Bankruptcy Filing
-------------------------------------------------------------
Jefferson County, Alabama, may be forced to file for bankruptcy if
the state's top court strikes down a jobs tax that provides almost
a third of its annual budget, an aide to County Commissioner James
Stephens said, according to reporting by William Selway at
Bloomberg News.
According to the Bloomberg report, David Hooks, chief of staff for
the commissioner, said FTI Consulting Inc., the firm hired to
create a plan for turning around the county's finances, is
preparing a possible bankruptcy filing as well as a rival plan for
spending cuts should the county be unable to levy the tax.
Mr. Hooks, Bloomberg relates, said the Alabama Supreme Court is
expected within the next several weeks to rule on whether to
strike down a revamped $70.5 million-a-year occupational tax,
potentially dealing a blow to the budget of Alabama's most-
populous county.
"If we do not get new revenue, then bankruptcy is almost
inevitable," Mr. Hooks said March 14 during a panel discussion at
a meeting of the National League of Cities in Washington.
Bloomberg recounts that a state judge ruled in December that a
jobs tax the county enacted was illegal because the Legislature
didn't properly disclose key elements of the bill before the
special session that led to its passage. The county appealed that
ruling to the Supreme Court.
"We've taken a third of our general-fund budget that just
disappeared overnight on top of what we were dealing with before,"
Mr. Hooks said in an interview after his remarks. "What we intend
to do is to have a plan in place to move forward under any
scenario."
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000. It ended its 2006 fiscal year with a
$42.6 million general fund balance, according to Standard &
Poor's.
Jefferson County is trying to restructure $3.2 billion in sewer
debt. A bankruptcy by Jefferson County stands to be the largest
municipal bankruptcy in U.S. history. It could beat the record of
$1.7 billion set by Orange County, California in 1994.
In September 2010, Alabama Circuit Court Judge Albert Johnson
named John S. Young Jr. LLC as receiver for the sewer system.
Jefferson County has hired business advisors FTI Consulting Inc.
to help sort out its massive debts. FTI will recommend ways the
county can restructure debt and help officials negotiate with
creditors, including JPMorgan Chase & Co.
* * *
In August 2010, Standard & Poor's Ratings Services withdrew its
underlying rating on Jefferson County, Ala.'s series 2001B general
obligation warrants. S&P lowered the SPUR to 'D' from 'B' on
Sept. 24, 2008, due to the county's failure to make a principal
payment on the bank warrants due Sept. 15, 2008, in accordance
with the terms of the Standby Warrant Purchase Agreement.
The county and the banks entered into a forbearance agreement that
effectively delayed payments due under the SWPA.
JOY LANE: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: Joy Lane, LLC
3200 Lakeside Village Dr., #201
Prescott, AZ 86301
Bankruptcy Case No.: 11-06062
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Redfield T. Baum PCT Sr.
Debtor's Counsel: Mark W. Roth, Esq.
Wesley Denton Ray, Esq.
POLSINELLI SHUGHART P.C.
One East Washington Street
CityScape Building, Suite 1200
Phoenix, AZ 85004
Tel: (602) 650-2012
Fax: (602) 926-8562
E-mail: mroth@polsinelli.com
wray@polsinelli.com
Estimated Assets: $1,000,001 to $10,000,000
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 Jason J. Gisi, managing member.
Debtor-affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Willow Creek Partners, LLC 11-06060 03/10/11
JUMA TECHNOLOGY: Gets $350,000 From Sale of Note to Vision
----------------------------------------------------------
On March 4, 2011, Juma Technology Corp. entered into a Note and
Warrant Purchase Agreement with Vision Opportunity Master Fund,
Ltd. A copy of the Note Purchase Agreement is available for free
at http://ResearchArchives.com/t/s?750e
Under the Note Purchase Agreement, the Company executed and
delivered to the Purchaser (a) the Company's $350,000 principal
amount, 10% Bridge Note and (b) a Series A Warrant to purchase an
aggregate of 2,333,333 shares of the Company's common stock.
The Company anticipates that the proceeds of $350,000 from the
sale of the Note and Warrant, net of professional fees of
approximately $1,000 incurred in connection with the negotiation,
execution, and delivery of the Note Purchase Agreement and
Warrant, will be used for general corporate purposes.
The sale of the Note and Warrant was made in reliance upon an
exemption from securities registration afforded by the provisions
of Section 4(2) of the Securities Act of 1933, as amended. In this
regard, the Company relied on the representations of the Purchaser
contained in the Note Purchase Agreement.
The Note accrues interest at 10% per annum from the date of
issuance, which interest is payable in cash at the maturity date,
which is the fifth day after demand. The Note does not contain
any conversion provisions. A copy of the Note is available for
free at http://ResearchArchives.com/t/s?750f
The Note contains various events of default such as failing to
make a payment of principal or interest when due, which if not
cured, would require the Company to repay the holder immediately
the outstanding principal sum of and any accrued interest on the
Note. The Note requires the Company to prepay the Note if certain
"Triggering Events" or "Major Transactions" occur while the
particular security is outstanding.
The Purchaser was issued a Series A Warrant by the Company for no
additional consideration. A copy of the Warrant is available for
free at http://ResearchArchives.com/t/s?7510
The Warrant entitles the holder thereof to purchase 2,333,333
shares of the Company's common stock at an exercise price of $0.15
per share; the term of the Warrant expires March 31, 2015.
The holder of the Warrant has agreed to restrict its ability to
exercise the Warrant and receive shares of the Company's common
stock such that the number of shares of common stock held by the
holder and its affiliates in the aggregate after such exercise
does not exceed 4.99% of the then issued and outstanding shares of
common stock.
The holder of the Series A Warrant has been granted certain
piggyback registration rights under the Note Purchase Agreement
and Warrant.
In addition to the above described Note Purchase Agreement, Note,
and Warrant, the Company has entered into an Acknowledgement and
Waiver of Anti-Dilution Adjustments. Under the Acknowledgement,
the Company acknowledged that the price protection provisions of
the Series B Preferred Stock were triggered by the issuance of the
Series A Warrant. By agreement, Vision Opportunity Master Fund,
Ltd. and Vision Capital Advantage Fund, LP, as applicable, agree
to waive the price protections of the Series B Preferred Stock. A
copy of the Acknowledgement is available for free at:
http://ResearchArchives.com/t/s?7511
About Juma Technology
Farmingdale, N.Y.-based Juma Technology Corp. is a highly
specialized convergence systems integrator with a complete suite
of services for the implementation and management of an entity's
data, voice and video requirements.
The Company's balance sheet at Sept. 30, 2010, showed
$4.29 million in total assets, $22.01 million in total
liabilities, and a stockholders' deficit of $17.72 million.
As reported in the Troubled Company Reporter on April 5, 2010,
Seligson & Giannattasio, LLP, in White Plains, N.Y., 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 incurred significant recurring
losses.
K-V PHARMACEUTICAL: Incurs $34.6-Mil. Net Loss in Fiscal Q1
-----------------------------------------------------------
K-V Pharmaceutical Company filed its quarterly report on Form 10-Q
with the U.S. Securities and Exchange Commission reporting a net
loss of $34.60 million on $3.37 million of net revenue for the
three months ended June 30, 2010, compared with a net loss of
$54.95 million on $6.29 million of net revenue for the same period
during the prior year.
The Company's balance sheet at June 30, 2010 showed
$315.48 million in total assets, $488.03 million in total
liabilities and a $172.55 million stockholders' deficit.
As reported in the Troubled Company Reporter on Jan. 3, 2011,
BDO USA, LLP, in Chicago, expressed substantial doubt about K-V
Pharmaceutical'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 suspended the
shipment of all but one of the products manufactured by the
Company and must comply with a consent decree with the Food and
Drug Administration before approved products can be reintroduced
to the market.
A full-text copy of the Quarterly Report is available for free at:
http://ResearchArchives.com/t/s?74f2
About KV Pharmaceutical
KV Pharmaceutical Co., with headquarters in St. Louis, Missouri,
is a specialty pharmaceutical company that develops, manufactures
and markets innovative branded, quality generic/non-branded and
unique specialty ingredient products, utilizing proprietary drug
delivery technologies. In addition to its comprehensive research
& development and manufacturing processes, KV has broad marketing
and sales capabilities through its two wholly owned subsidiaries,
Ther-Rx Corporation, marketing branded products and ETHEX
Corporation, marketing generic/non-branded products.
* * *
The Company reported a net loss of $283.6 million on
$152.2 million of net revenues for fiscal 2010, compared to a net
loss of $313.6 million on $312.3 million of net revenue for fiscal
2009.
KIMHYO, LLC: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Kimhyo, LLC
4101 Atlantic Avenue
Atlantic City, NJ 08401
Bankruptcy Case No.: 11-17340
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of New Jersey (Camden)
Judge: Gloria M. Burns
Debtor's Counsel: Ronald Kinzler, Esq.
564 Shore Road
Somers Point, NJ 08244
Tel: (609) 927-7965
Fax: (609) 927-5191
E-mail: kinzlex@aol.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Soonying Kim Goodlin aka Ryanghee Kim,
president.
KINDRED HEALTHCARE: S&P Assigns 'B+' Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its
preliminary 'B+' corporate credit rating to Kindred Healthcare
Inc. S&P also assigned a preliminary issue-level rating of 'B+'
(the same as the corporate credit rating) and assigned a
preliminary recovery rating of '3' to the company's proposed term
loan. The rating outlook on the company is stable.
"The rating on Kindred Healthcare reflects the reimbursement risk
of the Kindred's businesses as well as the relatively competitive
and fragmented market characteristics for the services they
provide," said Standard & Poor's credit analyst David Peknay.
Moreover, while the acquisition of RehabCare will expand its
position in post-acute care services, the debt required for the
transaction contributes to its aggressive financial risk profile.
S&P expects that after the completion of the RehabCare
acquisition, Kindred will derive about 70% of its revenues from
government sources. Although a major portion of its services are
provided to a large number of third-party facilities through
contractual relationships, the weak business risk profile
incorporates indirect risk to Kindred if possible changes in
regulations or reimbursement hurts its contractual partners. When
considering its facility-based businesses, primarily its 226
skilled nursing facilities and 118 long term acute care hospitals,
S&P considers the risk to its margins of potentially significant,
but currently unforeseen adverse changes to payment rates or
payment methodology by government health reform efforts to limit
health costs. Additionally, the long-term outlook for long term
acute care hospitals may become cloudy if there are large-scale
changes in the regulations and payment methodology for all post-
acute-care services.
LANIER LODGE: May Recover Nominal Damages in Manton Suit
--------------------------------------------------------
In Duke Galish, LLC v. Manton, the Court of Appeals of Georgia
affirmed the grant of summary judgment to appellee John P. "Jack"
Manton and others on the claims for tortious interference with
contract and fraud brought by Duke Galish, LLC and Lanier Lodge,
Inc. Lanier also brought a breach of contract claim against Mr.
Manton, which remained pending in the trial court.
Following Manton I, the trial court granted summary judgment to
Manton on the breach of contract claim. Lanier appeals.
In a decision dated March 9, 2011, Judge Charles B. Mikell
reversed, but held that Lanier is limited to recovering nominal
damages.
The case is Duke Galish, LLC. et al. v. Manton, A10A2272 (Ga. App.
Ct.). A copy of the March 9 decision is available at
http://is.gd/WWMTKgfrom Leagle.com.
Lanier, which was co-owned by the Anglin family and Mr. Manton,
operated a motel in Forsyth County. In 1996, Lanier refinanced
the motel property by obtaining a $2,000,000 loan from Bank of
North Georgia. In 2001, Mr. Manton sold his interest in Lanier to
Anglin for $75,000 in cash and a $415,000 promissory note, which
was secured by a second priority security interest in the motel
property. Lanier ceased operating the motel in January 2003 and
defaulted on its financial obligations. Mr. Manton sued Lanier
and the Anglins for breach of the promissory note in the Superior
Court of Forsyth County. BNG then accelerated Lanier's debt, and
Lanier filed a Chapter 11 bankruptcy petition to avoid
foreclosure.
In 2004, Lanier filed a motion in the bankruptcy court seeking
permission to sell the motel property to Duke Galish, a company
also owned by the Anglins, for $1,700,000. The deal did not
materialize. The trustee opposed the sale for numerous reasons,
including Lanier's failure to satisfy the contingency in the
agreement requiring it to obtain a building permit to redevelop
the motel property. In addition, the trustee determined that the
price was not enough to pay off the secured creditors' claims and
produce any return for the bankruptcy estate. Ultimately,
Lanier's case was converted to Chapter 7, and the automatic stay
was lifted. BNG foreclosed on the motel property.
LEGACY BANK: Closed; Seaway Bank and Trust Co Assumes All Deposits
------------------------------------------------------------------
Legacy Bank of Milwaukee, Wis., was closed on Friday, March 11,
2011, by the Wisconsin Department of Financial Institutions, which
appointed the Federal Deposit Insurance Corporation as receiver.
To protect the depositors, the FDIC entered into a purchase and
assumption agreement with Seaway Bank and Trust Company of
Chicago, Ill., to assume all of the deposits of Legacy Bank.
The sole branch of Legacy Bank will reopen on its normal banking
hours as a branch of Seaway Bank and Trust Company. Depositors of
Legacy Bank will automatically become depositors of Seaway Bank
and Trust Company. Deposits will continue to be insured by the
FDIC, so there is no need for customers to change their banking
relationship in order to retain their deposit insurance coverage
up to applicable limits. Customers of Legacy Bank should continue
to use their existing branch until they receive notice from Seaway
Bank and Trust Company that it has completed systems changes to
allow other Seaway Bank and Trust Company branches to process
their accounts as well.
As of Dec. 31, 2010, Legacy Bank had around $190.4 million in
total assets and $183.3 million in total deposits. In addition to
assuming all of the deposits of the failed bank, Seaway Bank and
Trust Company agreed to purchase about $165.9 million of Legacy
Bank's assets. The FDIC will retain the remaining assets for
later disposition.
The FDIC and Seaway Bank and Trust Company entered into a loss-
share transaction on $120.0 million of Legacy Bank's assets.
Seaway Bank and Trust Company will share in the losses on the
asset pools covered under the loss-share agreement. The loss-
share transaction is projected to maximize returns on the assets
covered by keeping them in the private sector. The transaction
also is expected to minimize disruptions for loan customers. For
more information on loss share, please visit:
http://www.fdic.gov/bank/individual/failed/lossshare/index.html
Customers who have questions about the transaction can call the
FDIC toll-free at 1-800-430-7974. Interested parties also can
visit the FDIC's Web site at
http://www.fdic.gov/bank/individual/failed/legacy-wi.html
The FDIC estimates that the cost to the Deposit Insurance Fund
will be $43.5 million. Compared to other alternatives, Seaway
Bank and Trust Company's acquisition was the least costly
resolution for the FDIC's DIF. Legacy Bank is the 25th FDIC-
insured institution to fail in the nation this year, and the third
in Wisconsin. The last FDIC-insured institution closed in the
state was Badger State Bank, Cassville, on February 11, 2011.
LIMEHOUSE VILLAGE: Case Summary & 3 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Limehouse Village LLC
P.O. Box 671048
Marietta, GA 30066
Bankruptcy Case No.: 11-57604
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Judge: Paul W. Bonapfel
Debtor's Counsel: David G. Bisbee, Esq.
LAW OFFICE OF DAVID G. BISBEE
2929 Tall Pines Way
Atlanta, GA 30345
Tel: (770) 939-4881
Fax: (770) 783-8595
E-mail: bisbeed@bellsouth.net
Scheduled Assets: $8,829,431
Scheduled Debts: $8,957,601
A list of the Company's three largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/ganb11-57604.pdf
The petition was signed by Edward Terry, manager.
Debtor-affiliates that filed separate Chapter 11 petitions:
Petition
Debtor Case No. Date
------ -------- ----
Hampton Homes, Inc 09-87296 10/15/09
Canton Commercial Holdings LLC 10-67891 03/17/10
Duluth 120 Corp 11-56025 02/18/11
LIZ CLAIBORNE: S&P Cuts Corp. to 'CC' on Below Par Cash Offer
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
corporate credit rating on New York City-based Liz Claiborne Inc.
to 'CC' from 'B-'. At the same time, S&P lowered the issue-level
rating on Liz Claiborne's 5% notes due 2013 to 'CC' from 'CCC+'.
The recovery rating on this debt remains '5'. In addition, S&P
placed the corporate credit rating and all issue-level ratings on
CreditWatch with negative implications, meaning that S&P could
lower or affirm the ratings following resolution of the
CreditWatch.
The rating action follows the company's announcement that it plans
to pursue a cash tender offer for up to EUR155 million of its
EUR350 million 5% notes due 2013 at a total consideration of less
than 100% of principal plus accrued interest. Based on S&P's
criteria, S&P views the transaction as a distressed offer. The
tender offer is scheduled to expire on April 5, 2011.
"The CreditWatch listing reflects S&P's expectations to lower the
corporate credit rating to 'SD' (selective default), and lower its
rating on the 5% notes to 'D' (default) upon the consummation of
the tender offer," said Standard & Poor's credit analyst Jeffrey
Burian. In addition, S&P believes the ratings on the company's 6%
convertible notes may be negatively impacted by the addition of
secured debt to fund this transaction which could, in S&P's
opinion, weaken the recovery prospects for these notes, which
could, in turn, result in a lower issue-level rating . The
company has stated it intends to issue new senior secured notes to
fund the tender offer.
Upon completion of the tender offer, S&P would re-evaluate the
company's credit profile given the resulting changes in the
capital structure.
"Based upon currently available information," added Mr. Burian,
"it is its preliminary view that S&P would raise the corporate
credit rating back to 'B-', although this is subject to further
review upon the emergence of more details." The issue-level and
recovery ratings on the remaining 5% notes and 6% convertible
notes would be determined according to their recovery prospects in
the new capital structure.
LOAN EXCHANGE: Taps County Law Center as Bankruptcy Counsel
-----------------------------------------------------------
Loan Exchange Group, A California General Partner, sought and
obtained permission from the Bankruptcy Court to employ Marc A.
Duxbury and County Law Center as bankruptcy counsel:
Marc A. Duxbury, Esq.
1901 Camino Vida Roble, Suite 114
Carlsbad, CA 92008
Tel: 760-438-5291
E-mail: info@countylawcenter.com
The firm is being paid on an hourly basis at these rates:
$350 per hour for Marc A. Duxbury
$185 per hour for paralegal time
The Debtor has paid a $20,000 retainer.
Members of County Law Center represent that they hold no interest
materially adverse to the Debtor or its estate in the matter upon
which they are to be engaged.
About Loan Exchange
Loan Exchange Group, a California General Partnership based in
Westlake Village, California, filed for Chapter 11 bankruptcy
(Bankr. C.D. Calif. Case No. 10-23699) on Oct. 28, 2010. The
Debtor scheduled $12,050,570 in assets and $4,920,968 in debts.
LOMBARD PUBLIC: S&P Cuts Issue Ratings to 'CC' on Distressed Offer
------------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its issue
ratings on Lombard Public Facilities Corp. to 'CC' from 'B-'. The
outlook is negative. At the same time, S&P is assigning a
recovery rating of '4', indicating an average (30%-50%) recovery
of principal if a payment default occurs.
The rating actions result from the LPFC's tender offer to the
bondholders of series 2005 A-1, series 2005 A-2, and series 2005
C. The project will fund the tender offer with proceeds from
series 2011A and series 2011C conference center and hotel
refunding revenue bonds (AA-/Negative). Securing these bonds will
be the Village of Lombard, Ill.'s commitment, subject to
appropriation, under the tax rebate agreement to pay debt service
if the other sources, including a first lien on hotel net
revenues, are exhausted. S&P views this exchange offer as
distressed and equivalent to a default based on S&P's rating
criteria: lenders will not obtain anywhere near the original
amount of the debt tendered, the maturity of the new debt is
longer, and the exchange is not an opportunistic event for LPFC
but an effort to improve the hotel's very limited financial
flexibility while it continues ramp-up. The project now projects
stabilization to occur in 2014, two years later than management
originally expected.
At the same time, S&P assigned a recovery rating of '4' to the
bonds, suggesting an average recovery of between 30% and 50%. In
S&P's simulated default scenario, S&P assumed that the hotel
revenue per available room, declines to $54.00 in 2011, from
$69.35 in 2010. If the project defaults in 2017 as the cash flow
declines, the operating margins will remain at 25%, and the
reserves will be depleted.
LPFC owns the 500-room Westin Hotel & Resorts hotel and conference
center in Lombard. It opened on Aug. 22, 2007. Westin, a
subsidiary of Starwood Hotels & Resorts Worldwide Inc.
(BB+/Stable/--), operates the hotel under a 15-year agreement.
The poor creditworthiness stems from the project's poor
performance. It opened shortly before the recession caused a
severe downturn in the nationwide hospitality market, and the
Lombard market in particular.
The negative outlook reflects S&P's expectation that the project
will not achieve 1.0x coverage of all obligations, including the
furniture, fixture, and equipment deposits, from the project's net
income in 2011.
"While the project has enough liquidity to support series A bond
debt service for more than one and one-half years, S&P could lower
the rating if financial performance remains at this level for
longer than one to two years and the level of liquidity
significantly deteriorates," said Standard & Poor's credit analyst
Jodi Hecht.
S&P may revise the outlook back to stable if S&P sees the project
performance begin to improve, liquidity begins to build, and the
DSCR returns to 2008 levels.
M&S GRADING: IRS Not Required to Ensure Payroll Tax Payments
------------------------------------------------------------
Chief District Judge Joseph F. Bataillon affirmed the bankruptcy
court's grant of summary judgment in favor of the defendants in
the suit, CONTRACTORS, LABORERS, TEAMSTERS & ENGINEERS HEALTH &
WELFARE PLAN; CONTRACTORS, LABORERS, TEAMSTERS & ENGINEERS PENSION
PLAN; and INTERNATIONAL UNION OF LOCAL 571 OPERATING ENGINEERS,
Plaintiffs, v. INTERNAL REVENUE SERVICE, and JAMES KILLIPS as
Trustee for M & S GRADING, INC., Defendants, Nos. 8:10CV271 (D.
Neb.).
Plaintiffs sued the Internal Revenue Service and the bankruptcy
trustee for M & S Grading, an extraction company in Omaha,
Nebraska, which filed for bankruptcy in 2002 (Bankr. D. Neb. Case
No. 02-81632). Plaintiffs are the multi-employer plans. They
provided health, pension and welfare benefits to the employees of
the Debtor. In 2005, the Debtor ceased operations. At that time
the bankruptcy case was converted to a Chapter 7. Thereafter, the
stay was lifted and secured creditor First National Bank of Omaha
received nearly all of the Debtor's assets under its security
interest. The Debtor failed to pay $100,000 in contribution
payments and deposit nearly $1,000,000 in payroll taxes owed to
the IRS.
The government and the plaintiffs filed cross-motions for summary
judgment. The plaintiffs claimed counsel for the IRS had a
fiduciary duty to the employees to collect the taxes withheld from
the employees' paychecks before the funds were taken by FNBO.
They base this argument on a 2002 stipulation between the Debtor,
FNBO, and the IRS, which plaintiffs allege that under the
Stipulation they are third-party beneficiaries. The Stipulation
required the IRS, the debtor and the Bank to set aside the
workers' payroll taxes collected from their earnings and put them
into a special account for the IRS. The plaintiffs claim the IRS
had a fiduciary duty to collect these payroll taxes from the
debtor. The 2002 Stipulation required the Debtor to file all of
its federal tax returns and pay its federal taxes into a special
FNBO account. Under the Stipulation, the Debtor was not allowed
to place its tax funds into any other account, and FNBO waived its
security interest and right of setoff as to any taxes deposited in
this account. The Stipulation was approved by the bankruptcy
court in 2002.
The plaintiffs argue that there is a controlling question of non-
bankruptcy law involving a new case from the Nebraska Supreme
Court, Perez v. Stern, 777 N.W.2d 545 (Neb. 2010). Under Perez,
argue plaintiffs, the court must decide "whether the Plaintiffs
are third party beneficiaries of the July 26 Stipulation and Order
signed by the debtor in possession, the IRS, and the FNBO which
required the IRS and the FNBO to make sure the men's tax
withholdings were not diverted to the debtors purposes but were
used to pay taxes."
The bankruptcy court found that the plaintiffs failed to offer any
authority to support their position. The bankruptcy court further
found that Perez was not relevant to the case and that there was
nothing to support the argument that Perez applied to government
attorneys. Further, in the alternative, the bankruptcy court
determined that even if Perez applied, any duty on the part of
counsel for the IRS did not extend to the plaintiffs. In
addition, the bankruptcy court found that the 2002 Stipulation
created no duty on the part of the IRS counsel to make sure that
the payroll taxes of the Debtor were paid.
The District Court held that the bankruptcy court's grant of
summary judgment is supported by the law and the facts. The
interlocutory appeal is overruled. The ruling of the bankruptcy
judge granting summary judgment against the plaintiffs and in
favor of the defendants is affirmed. The case is remanded to the
bankruptcy court for further disposition.
A copy of the District Court's March 10, 2011 memorandum and order
is available at http://is.gd/WZV1Ehfrom Leagle.com.
MAYS PRINTING: Case Summary & 9 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Mays Printing Co., Inc.
15800 Livernois
Detroit, MI 48238
Bankruptcy Case No.: 11-46604
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Steven W. Rhodes
Debtor's Counsel: Edward J. Gudeman, Esq.
GUDEMAN & ASSOCIATES, PC
26862 Woodward Ave., Suite 103
Royal Oak, MI 48067
Tel: (248) 546-2800
E-mail: ejgudeman@gudemanlaw.com
Scheduled Assets: $500,000
Scheduled Debts: $1,361,000
A list of the Company's nine largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/mieb11-46604.pdf
The petition was signed by James Mays, president.
MEDICAL INVESTORS: Case Summary & 16 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Medical Investors Group, LLC
1200 Veterans Highway, Suite 310
Hauppauge, NY 11788
Bankruptcy Case No.: 11-01874
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: J. Rich Leonard
Debtor's Counsel: Michael P. Peavey, Esq.
P.O. Box 1115
Wilson, NC 27894-1115
Tel: (252) 291-8020
Fax: (252) 291-8309
E-mail: mpeavey@peaveylaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 16 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/nceb11-01874.pdf
The petition was signed by Joseph T. Mirando, manager.
MICROVISION INC: Recurring Losses Cue Going Concern Doubt
---------------------------------------------------------
MicroVision, Inc., filed on March 10, 2011, its annual report on
Form 10-K for the fiscal year ended Dec. 31, 2010.
PricewaterhouseCoopers LLP, in Seattle, Washington, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has suffered recurring losses from operations since inception and
has a net capital deficiency.
The Company reported a net loss of $47.5 million on $4.7 million
of revenue for 2010, compared with a net loss of $39.5 million on
$3.8 million of revenue for 2009.
At Dec. 31, 2010, the Company's balance sheet showed $35.2 million
in total assets, $13.4 million in total liabilities, and
shareholders' equity of $21.8 million.
A full-text copy of the From 10-K is available for free at:
http://researcharchives.com/t/s?7513
Redmond, Washington-based MicroVision, Inc. (NASDAQ: MVIS)
-- http://www.microvision.com/-- provides the PicoP(R) display
technology platform designed to enable next-generation display and
imaging products for pico projectors, vehicle displays and
wearable displays that interface with mobile devices.
MOLECULAR INSIGHT: Holders of $200-Mil. in Bonds in Plan Talks
-------------------------------------------------------------
Various shareholders of Molecular Insight Pharmaceuticals, Inc.,
amended their respective Schedule 13Ds filed with the Securities
and Exchange Commission to disclose that ongoing discussions with
certain other stakeholders of the Company regarding a plan of
reorganization for the Company.
The parties involved in the talks are:
* Taconic Capital Advisors LP, et al.,
* Quintessence Fund L.P.;
* QVT Fund LP;
* McDonnell Loan Opportunity Fund Ltd.;
* Highland Capital Management, L.P.; and
* Pioneer Floating Rate Trust.
The stakeholders hold approximately $200 million in principal
amount of the Company's Senior Secured Floating Rate Bonds due
2012.
A full-text copy of Taconic's SC 13D Amendment No. 2 is available
for free at http://researcharchives.com/t/s?74fb
A full-text copy of Highland Capital SC 13D Amendment No. 2 is
available for free at http://researcharchives.com/t/s?74fc
A full-text copy of the Pioneer's SC 13D Amendment No. 2 is
available for free at http://researcharchives.com/t/s?74fd
A full-text copy of McDonnell's SC 13D Amendment No. 2 is
available for free at http://researcharchives.com/t/s?74fe
About Molecular Insight
Cambridge, Massachusetts-based Molecular Insight Pharmaceuticals,
Inc., is a clinical-stage biopharmaceutical company that provides
services on the detection and treatment of various forms of cancer
and other life-threatening diseases. The Debtor disclosed
$36,453,000 in total assets and $198,829,000 in total debts as of
September 30, 2010.
Molecular Insight filed for Chapter 11 bankruptcy protection
(Bankr. D. Mass. Case No. 10-23355) on Dec. 9, 2010. Kramer
Levin Naftalis & Franklin LLP serves as the Debtor's lead
bankruptcy counsel. Alan L. Braunstein, Esq., at Riemer &
Braunstein, LLP, serves as the Debtor's local Massachusetts
counsel. Foley & Lardner LLP is the Debtor's special counsel.
Tatum LLC, a division of SFN Professional Services LLC, is the
Debtor's financial consultant. Omni Management Group, LLC, is the
claims, and balloting agent.
MONEYGRAM INT'L: Inks Recapitalization Pact With Goldman Sachs
--------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, The Goldman Sachs Group, Inc. and its
affiliates disclosed that they beneficially own 152,734,952 shares
of common stock of MoneyGram International, Inc. representing
29.7% of the shares outstanding.
The percentage ownership is based upon a total of 513,750,695
shares of Common Stock outstanding, which is the sum of (a)
83,620,522 shares of Common Stock outstanding as of March 1, 2011,
as represented by the Issuer in the Recapitalization Agreement,
plus (b) 277,412,946 shares of Common Stock issuable upon the
conversion of the 495,000 shares of Series B Participating
Convertible Preferred Stock of the Company held by THL and Silver
Point, if such conversion occurred on Dec. 21, 2010, plus (c)
152,717,228 shares of Common Stock issuable upon the conversion by
a holder other than the Reporting Persons or their affiliates,
subject to certain limitations, of 152,717.2276 shares of Series D
Participating Convertible Preferred Stock of the Issuer, which are
issuable upon the conversion of the 272,500 shares of Series B-1
Participating Convertible Preferred Stock of the Issuer issued to
the Reporting Persons pursuant to the Purchase Agreement on
March 25, 2008, if such conversion occurred on Dec. 21, 2010. The
shares of Series B-1 Participating Convertible Preferred Stock
held by Goldman Sachs, et al., or the shares of Series D
participating Convertible Preferred Stock that may be held by them
do not vote as a class with the Common Stock.
On March 7, 2011, the Investors and the Company entered into a
recapitalization agreement in order to facilitate the
simplification of the capital structure of the Company and for
other good and valid business reasons. Pursuant to the
Recapitalization Agreement, subject to the terms and conditions
therein:
(i) the holders of Series B Stock will convert all of the
shares of Series B Stock into Common Stock in accordance
with the Series B Certificate;
(ii) the GS Investors will convert all of the shares of Series
B-1 Stock into Series D Stock in accordance with the Series
B-1 Certificate;
(iii) the Series D Certificate will be amended as set forth in
the form of Certificate of Designations, Preferences and
Rights of the Series D Participating Convertible Preferred
Stock of the Company;
(iv) the dividends on the Series B Stock and Series B-1 Stock
with respect to the quarterly dividend period in which the
closing of the Recapitalization takes place will be paid in
cash at a rate of 12.5%; and
(v) as an inducement to the Investors to effect those
conversions in accordance with the Series B Certificate and
the Series B-1 Certificate and to forgo the rights to
liquidation preferences and future dividends provided for
in the Series B Certificate and the Series B-1 Certificate,
as applicable, the Company will pay the Investors
additional consideration in the form of cash and issue to
the Investors additional shares of Common Stock or Series D
Preferred Stock.
About MoneyGram International
MoneyGram International, Inc. (NYSE: MGI) --
http://www.moneygram.com/-- is a leading global payment services
company. The Company's major products and services include global
money transfers, money orders and payment processing solutions for
financial institutions and retail customers. MoneyGram is a New
York Stock Exchange listed company with 203,000 global money
transfer agent locations in 191 countries and territories.
The Company's balance sheet at Dec. 31, 2010, showed $5.12 billion
in total assets, $5.06 billion in total liabilities,
$999.35 million in mezzanine equity and a $942.48 million
stockholders' deficit.
* * *
According to the Troubled Company Reporter on July 1, 2010, Fitch
Ratings has affirmed the Issuer Default Ratings for MoneyGram
International Inc. and MoneyGram Payment Systems Worldwide, Inc.,
at 'B+'. Outlook is stable. Fitch noted that the ratings could
be negatively impacted by further declines in remittance volumes
driven by macro economic factors or decreases in migrant labor
populations worldwide.
MONEYGRAM INT'L: Thomas H. Lee Discloses 54.0% Equity Stake
-----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Thomas H. Lee Advisors, LLC and its
affiliates disclosed that they beneficially own 277,412,946 shares
of common stock of MoneyGram International, Inc. representing
54.0% of the shares outstanding.
This percentage is calculated using a fraction, the numerator of
which is the number of shares of Common Stock into which the
applicable affiliate of Thomas H. Lee Partners, L.P. could
convert, and the denominator of 513,750,695 (which is calculated
by adding the number of outstanding shares of Common Stock as of
March 1, 2011, 83,620,522, plus the total number of shares of
Common Stock into which all shares of Series B Stock and Series B-
1 Stock could convert within 60 days from the date hereof, giving
effect to the accrual of dividends from March 25, 2008 through the
end of the last quarterly dividend period completed prior to Dec.
21, 2010.
Pursuant to the terms of the Series B Certificate, the holders of
Series B Stock will be entitled to a number of votes per share of
Series B Stock equal to the product of (x) a fraction, the
numerator of which is the sum of the number of shares outstanding
as of the end of the Accrual Period (or other applicable date, as
the case may be) of (A) Series B Stock and (B) Series B-1 Stock,
and the denominator of which is the number of shares of Series B
Stock as of the end of the Accrual Period, and (y) the number of
votes to which shares of Common Stock issuable upon conversion of
each share of Series B Stock would have been entitled if such
shares of Common Stock were outstanding as of the end of the
Accrual Period. Thus, the voting power of Thomas H. Lee Advisors,
LLC would be 430,130,173 votes or 83.7% of the combined voting
power of the Series B Stock and Common Stock voting together as a
single class. This Schedule 13D reflects the accrual of
dividends, in accordance with the Series B Certificate and the
Series B-1 Certificate, from March 25, 2008 through the end of the
Accrual Period.
On March 7, 2011, the Company and the Investors entered into a
recapitalization agreement in order to facilitate the
simplification of the capital structure of the Company and for
other good and valid business reasons. Pursuant to the
Recapitalization Agreement, subject to the terms and conditions
therein, (i) the holders of Series B Stock will convert all of the
shares of Series B Stock into Common Stock in accordance with the
Series B Certificate, (ii) the GS Investors will convert all of
the shares of Series B-1 Stock into Series D Stock in accordance
with the Series B-1 Certificate, (iii) the Series D Certificate
will be amended, (iv) the dividends on the Series B Stock and
Series B-1 Stock with respect to the quarterly dividend period in
which the closing of the transactions contemplated by the
Recapitalization Agreement takes place will be paid in cash at a
rate of 12.5%, and (v) as an inducement to the Investors to effect
such conversions in accordance with the Series B Certificate and
the Series B-1 Certificate and to forgo the rights to liquidation
preferences and future dividends provided for in the Series B
Certificate and the Series B-1 Certificate, as applicable, the
Company will pay the Investors additional consideration in the
form of cash and issue to the Investors additional shares of
Common Stock or Series D Preferred Stock, as applicable.
As set forth in the Recapitalization Agreement, the consummation
of the transactions contemplated by the Recapitalization Agreement
is subject to the satisfaction (or waiver by the Company or the GS
Investors and the holders of 97% (in certain instances 100%) of
the Series B Stock, as applicable) of certain conditions,
including without limitation, (i) the accuracy of representations
and warranties of the Company and the Investors, respectively, as
of the Closing Date, (ii) the Company's and the Investors'
respective performance and compliance in all material respects
with all agreements, covenants and conditions contained in the
Recapitalization Agreement required to be performed or complied
with by the Company and the Investors, respectively, (iii) the
absence of any order, decree or ruling issued by, or action
commenced before, a governmental authority prohibiting the
consummation of the transactions contemplated by the
Recapitalization Agreement or that could reasonably be expected to
prevent or result in substantial damages with respect to, the
consummation of the transactions contemplated by the
Recapitalization Agreement, (iv) receipt of all required
governmental approvals, including any regulatory approvals and
necessary third party consents and the board of directors of the
Company shall not have withdrawn or changed its recommendation
that the stockholders of the Company vote in favor of the
Recapitalization and (v) receipt of (A) approval of the holders of
a majority of all outstanding voting stock of the Company, voting
as a single class, present in person or by proxy at a meeting of
the stockholders of the Company and (B) approval of the
transactions contemplated by the Recapitalization Agreement by the
holders of a majority of all outstanding voting stock of the
Company at the Stockholder Meeting, (vi) each other Investor will
have consummated, or will consummate, the actions required to
consummate the transactions contemplated by the Recapitalization
Agreement such that at least 97% of the Series B Stock and 100% of
the Series B-1 Stock will be converted on the Closing Date, (vii)
the absence of any event, development, circumstance or occurrence
since the execution of the Recapitalization Agreement that,
individually or in the aggregate, has had or would reasonably be
expected to have a material adverse effect on the Company and its
subsidiaries taken as a whole, and (viii) the Company's delivery
of a signature page evidencing the amendment to the Registration
Rights Agreement by and among the THL Investors, the GS Investors
and the Company.
In addition, the shares of Common Stock issued pursuant to the
Recapitalization Agreement, including the shares of Common Stock
issuable upon conversion of the Series D Stock, will be duly
listed and admitted and authorized for trading, subject to
official notice of issuance, on the New York Stock Exchange. The
Company will have filed a pre-effective amendment to its
registration statement on Form S-3 to include the Additional
Shares, and the shares of Common Stock into which any Additional
Shares may be converted, in the Registration Statement. Lastly,
the consummation of the transactions contemplated by the
Recapitalization Agreement is subject to receipt by the Company of
financing in an amount and on terms no less favorable to the
Company than as set forth in the Recapitalization Agreement.
In the event the Closing Date is before June 24, 2011, pursuant to
the Recapitalization Agreement, the Reporting Persons will receive
an aggregate of 308,245,653 shares of Common Stock and
$137,969,598 in cash and 12.5% cash dividends payable with respect
to the Series B Stock held by the Reporting Persons for the
quarterly dividend period including the Closing Date. In the
event the Closing Date is on or after June 24, 2011, pursuant to
the Recapitalization Agreement, the Reporting Persons will receive
an aggregate of 316,872,243 shares of Common Stock and
$137,969,598 in cash and 12.5% cash dividends payable with respect
to the Series B Stock held by the Reporting Persons for the
quarterly dividend period including the Closing Date.
About MoneyGram International
MoneyGram International, Inc. (NYSE: MGI) --
http://www.moneygram.com/-- is a leading global payment services
company. The Company's major products and services include global
money transfers, money orders and payment processing solutions for
financial institutions and retail customers. MoneyGram is a New
York Stock Exchange listed company with 203,000 global money
transfer agent locations in 191 countries and territories.
The Company's balance sheet at Dec. 31, 2010, showed $5.12 billion
in total assets, $5.06 billion in total liabilities,
$999.35 million in mezzanine equity and a $942.48 million
stockholders' deficit.
* * *
According to the Troubled Company Reporter on July 1, 2010, Fitch
Ratings has affirmed the Issuer Default Ratings for MoneyGram
International Inc. and MoneyGram Payment Systems Worldwide, Inc.,
at 'B+'. Outlook is stable. Fitch noted that the ratings could
be negatively impacted by further declines in remittance volumes
driven by macro economic factors or decreases in migrant labor
populations worldwide.
MONEYGRAM INT'L: Inks Recapitalization Pact With Silver Point
-------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Silver Point Capital, L.P. and its affiliates
disclosed that they beneficially own 5,604,302 shares of common
stock of MoneyGram International, Inc. representing 1.1% of the
shares outstanding.
The percentage is calculated using a fraction, the numerator of
which is the number of shares of Common Stock into which the
applicable affiliates of Silver Point Capital, L.P. could convert,
and the denominator of 513,750,695 (which is calculated by adding
the number of outstanding shares of Common Stock as of March 1,
2011, 83,620,522, plus the total number of shares of Common Stock
into which all shares of Series B Stock and Series B-1 Stock (each
as defined herein) could convert within 60 days from the date
hereof, giving effect to the accrual of dividends from March 25,
2008 through the end of the last quarterly dividend period
completed prior to the date hereof (December 21, 2010), which is
430,130,173. If only the applicable affiliates of Silver Point
Capital, L.P. were to convert, they would own 6.3% of the Common
Stock of the Company assuming a denominator of 89,224,824, which
includes the number of outstanding shares of Common Stock as of
March 1, 2011 plus the total number of shares of Common Stock into
which shares of Series B Stock held by affiliates of Silver Point
Capital, L.P. could convert.
Pursuant to the terms of the Series B Certificate, the holders of
Series B Stock are entitled to a number of votes per share of
Series B Stock equal to the product of (x) a fraction, the
numerator of which is the sum of the number of shares outstanding
as of the end of the Accrual Period (or other applicable date, as
the case may be) of (A) Series B Stock and (B) Series B-1 Stock,
and the denominator of which is the number of shares of Series B
Stock as of the end of the Accrual Period, and (y) the number of
votes to which shares of Common Stock issuable upon conversion of
each share of Series B Stock would have been entitled if such
shares of Common Stock were outstanding as of the end of the
Accrual Period. Thus, the voting power of the holders of Series B
Stock (including the Reporting Persons) would be 430,130,173 votes
or 83.7% of the combined voting power of the Series B Stock and
Common Stock voting together as a single class.
On March 7, 2011, the Company and the Investors entered into a
recapitalization agreement. Pursuant to the Recapitalization
Agreement, subject to the terms and conditions therein, (i) the
holders of Series B Stock will convert all of the shares of Series
B Stock into Common Stock in accordance with the Series B
Certificate, (ii) the GS Investors will convert all of the shares
of Series B-1 Stock into Series D Stock in accordance with the
Series B-1 Certificate, (iii) the Series D Certificate will be
amended, (iv) the dividends on the Series B Stock and Series B-1
Stock that become payable with respect to the days from the end
of the immediately preceding quarterly period for which dividends
were accrued through and including the closing of the transactions
contemplated by the Recapitalization Agreement will be paid in
cash at a rate of 12.5%, and (v) as an inducement to the Investors
to effect such conversions in accordance with the Series B
Certificate and the Series B-1 Certificate and to forego the
rights to liquidation preferences and future dividends provided
for in the Series B Certificate and the Series B-1 Certificate, as
applicable, the Company will pay the Investors additional
consideration in the form of cash and issue to the Investors
additional shares of Common Stock or Series D Preferred Stock, as
applicable.
As set forth in the Recapitalization Agreement, the consummation
of the transactions contemplated by the Recapitalization Agreement
is subject to the satisfaction (or waiver by the Company or the GS
Investors and the holders of 97% of the Series B Stock, as
applicable) of certain conditions, including without limitation,
(i) the accuracy of representations and warranties of the Company
and the Investors, respectively, as of the Closing Date, (ii) the
Company's and the Investors' respective performance and compliance
in all material respects with all agreements, covenants and
conditions contained in the Recapitalization Agreement required to
be performed or complied with by the Company and the Investors,
respectively, (iii) the absence of any order, decree or ruling
issued by, or action commenced before, a governmental authority
that could reasonably be expected to prevent or result in
substantial damages with respect to, the consummation of the
transactions contemplated by the Recapitalization Agreement, (iv)
receipt of all required governmental approvals, including any
regulatory approvals and necessary third party consents, (v) each
other Investor shall have consummated, or will consummate, the
actions required to consummate the transactions contemplated by
the Recapitalization Agreement such that at least 97% of the
Series B Stock and 100% of the Series B-1 Stock will be converted
on the Closing Date, (vi) the absence of any event, development,
circumstance or occurrence since the execution of the
Recapitalization Agreement that, individually or in the aggregate,
has had or would reasonably be expected to have a material adverse
effect on the Company and its subsidiaries taken as a whole and
(vii) receipt by the Company of financing on terms no less
favorable to the Company than those set forth in the
Recapitalization Agreement and reasonable acceptable to Equity
Fund and the GS Investors.
The consummation of the transaction contemplated by the
Recapitalization Agreement is further subject to the satisfaction
of the following conditions (i) the absence of any order, decree
or ruling issued by, or action commenced before, a governmental
authority prohibiting the consummation of the transactions
contemplated by the Recapitalization Agreement, (ii) receipt of
(A) approval of the holders of a majority of all outstanding
voting stock of the Company, voting as a single class, present in
person or by proxy at a meeting of the stockholders of the Company
and (B) approval of the holders of a majority of all outstanding
voting stock of the Company at the Stockholder Meeting, (iii) the
shares of Common Stock issued pursuant to the Recapitalization
Agreement, including the shares of Common Stock issuable upon
conversion of the Series D Stock, being duly listed and admitted
and authorized for trading, subject to official notice of
issuance, on the New York Stock Exchange and (iv) the Company
having filed a pre-effective amendment to its registration
statement on Form S-3 to include the Recapitalization Shares in
the Registration Statement.
In the event the Closing Date is on June 24, 2011, pursuant to the
Recapitalization Agreement, SPCP will receive 5,786,634 shares of
Common Stock as a result of the conversion of its shares of Series
B Stock and an additional 568,947 shares of Common Stock and
$2,844,733.98 in cash as an inducement to SPCP to effect the
transactions contemplated by the Recapitalization Agreement and to
forgo the rights to liquidation preferences and future dividends
provided for in the Series B Certificate, and 12.5% cash dividends
payable with respect to the Series B Stock held by SPCP for the
quarterly dividend period including the Closing Date. In the
event the Closing Date is after June 24, 2011 but on or before
September 23, 2011, pursuant to the Recapitalization Agreement,
SPCP will receive 5,964,502 shares of Common Stock as a result of
the conversion of its shares of Series B Stock and an additional
568,947 shares of Common Stock and $2,844,733.98 in cash as an
inducement to the Reporting Persons to effect the transactions
contemplated by the Recapitalization Agreement and to forgo the
rights to liquidation preferences and future dividends provided
for in the Series B Certificate, and 12.5% cash dividends payable
with respect to the Series B Stock held by SPCP for the quarterly
dividend period including the Closing Date.
About MoneyGram International
MoneyGram International, Inc. (NYSE: MGI) --
http://www.moneygram.com/-- is a leading global payment services
company. The Company's major products and services include global
money transfers, money orders and payment processing solutions for
financial institutions and retail customers. MoneyGram is a New
York Stock Exchange listed company with 203,000 global money
transfer agent locations in 191 countries and territories.
The Company's balance sheet at Dec. 31, 2010, showed $5.12 billion
in total assets, $5.06 billion in total liabilities,
$999.35 million in mezzanine equity and a $942.48 million
stockholders' deficit.
* * *
According to the Troubled Company Reporter on July 1, 2010, Fitch
Ratings has affirmed the Issuer Default Ratings for MoneyGram
International Inc. and MoneyGram Payment Systems Worldwide, Inc.,
at 'B+'. Outlook is stable. Fitch noted that the ratings could
be negatively impacted by further declines in remittance volumes
driven by macro economic factors or decreases in migrant labor
populations worldwide.
MYLAN INC: Moody's Upgrades Corporate Family Rating to 'Ba2'
------------------------------------------------------------
Moody's Investors Service upgraded the ratings of Mylan Inc.
including the Corporate Family Rating to Ba2 from Ba3. Following
this rating action, the rating outlook is stable.
Rating upgraded:
-- Corporate Family Rating to Ba2 from Ba3
-- Probability of Default Rating to Ba2 from Ba3
-- Senior unsecured notes due 2017, 2018 and 2020 to Ba3 (LGD 4,
69%) from B1 (LGD 4, 69%)
Ratings affirmed:
-- Senior secured revolving credit agreement at Baa3 (LGD 2,
13%)
-- Senior secured Term Loan B and Euro Term Loans at Baa3 (LGD
2, 13%)
Rating lowered:
-- Speculative Grade Liquidity Rating to SGL-2 from SGL-1
Rating withdrawn following repayment:
-- Baa3 (LGD2, 13%) U.S. Term Loan A
Ratings Rationale
The rating upgrade reflects Mylan's improving revenue, cash flow
and EBITDA trends, expected to continue over the next several
years based on a healthy outlook for generic drug manufacturers.
Following cash flow improvements in 2010, cash from
operations/debt and free cash flow/debt rose to levels within
Moody's "Ba" ranges. Mylan's debt/EBITDA improved to 4.1 times as
of December 31, 2010 (using Moody's adjustments) compared to 4.3
times as of December 31, 2009. Moody's anticipates that leverage
will further improve during 2011 based on EBITDA growth of 15% to
20%, and the expectation that business development will not add
any substantial amounts of debt. Mylan has continued to reiterate
a long-term debt/EBITDA target of 3.0 times, and has made
generally steady progress towards this goal ever since the October
2007 acquisition of Merck KGaA's generics business.
"Moody's upgrade of Mylan reflects improving earnings trends
accomplished through new product launches, a strong global
generics footprint, and good vertical integration," stated Moody's
Senior Vice President Michael Levesque.
Mylan's Ba2 Corporate Family Rating continues to reflect good size
and scale as the #3 player in the global generics pharmaceutical
industry, a solid global generic drug pipeline, and revenue
diversity from the specialty branded segment. Risk factors
include intense competition, cash outflows associated with
unresolved litigation expenses, and event risk related to M&A,
occurring rapidly in the global generic pharmaceutical sector.
"Although Moody's could further upgrade Mylan in the future, the
stable outlook reflects Moody's expectation for modest cash flow
to debt ratios over the next 12 to 18 months," continued Levesque.
Following the upgrade to Ba2, the rating outlook is stable.
Moody's believes that Mylan's operating performance and key credit
metrics may continue an upward trend, but that cash flow to debt
ratios supporting a Ba1 rating appear unlikely in the next 12 to
18 months. Sustaining a combination of these credit metrics
(using Moody's adjustments) could support an upgrade of Mylan's
ratings to Ba1: debt/EBITDA of 3.0 to 3.5 times; cash from
operations/debt of 20%-25%; and free cash flow/debt of 10%-15%.
Conversely, while not expected, these metrics could result in a
rating downgrade: Debt/EBITDA sustained above 4.0 times, cash from
operations/debt below 10%; or free cash flow/debt below 5%.
The reduction in the Speculative Grade Liquidity Rating to SGL-2
from SGL-1 reflects the inclusion of $600 million of senior
convertible notes as a near-term obligation based on the March
2012 maturity date. Even with this obligation, Mylan maintains
a good liquidity profile resulting from unrestricted cash of
$662 million reported as of December 31, 2010, positive free cash
flow, and a substantially undrawn revolving credit facility of
$750 million.
While the upgrade of the Corporate Family and Probability of
Default Ratings, the expected loss rate on Mylan's senior credit
facility improves, but still within the ranges of the existing
Baa3 rating, which is being affirmed.
Moody's does not rate Mylan's senior convertible notes of
$600 million due 2012 or the $575 million cash convertible
notes due 2015.
Headquartered in Canonsburg, Pennsylvania, Mylan Inc. is a
specialty pharmaceutical company. In 2010 Mylan reported total
revenues of $5.45 billion.
NAVISTAR INTERNATIONAL: Reports $6-Mil. Profit in Jan. 31 Qtr.
--------------------------------------------------------------
Navistar International Corporation filed its quarterly report on
Form 10-Q with the U.S. Securities and Exchange Commission
reporting net income of $6 million on $2.74 billion of sales and
revenues for the three months ended Jan. 31, 2011, compared with
net income of 32 million on $2.80 billion of sales and revenues
for the same period during the prior year.
The Company's balance sheet at Jan. 31, 2011 showed $9.27 billion
in total assets, $10.11 billion in total liabilities, $7 million
in redeemable equity securities and $839 million in total
stockholders' deficit.
"We have significantly raised truck production schedules by upto
40 percent on various models to reflect increasing order activity.
And, overall, we remain confident that we can deliver upon our
commitments while still investing in our global business," said
Daniel C. Ustian, Navistar chairman, president and chief executive
officer. "We see positive signs across all of our businesses. We
believe industry volumes should be at the higher end of our range,
military revenue will approach $2 billion, global volumes are
expanding and so far we have contained challenges in commodity
costs. Such that, we believe we can deliver results toward the
higher side of our guidance."
A full-text copy of the quarterly report on Form 10-Q is available
for free at http://ResearchArchives.com/t/s?74f4
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar has a 'BB-/Stable/--' corporate credit rating from
Standard & Poor's and a 'B1' Corporate Family Rating and
Probability of Default Rating from Moody's Investors Service.
Moody's said in October 2010 that Navistar's B1 rating could
improve if the North American truck market remains on track for a
sustained recovery into 2011, and Navistar's operational
initiatives to moderate its vulnerability to the truck cycle show
evidence of taking hold.
NBC ACQUISITION: Posts $16.29-Mil. Net Loss in Dec. 31 Qtr.
-----------------------------------------------------------
NBC Acquisition Corp. filed its quarterly report on Form 10-Q,
reporting a net loss of $16.29 million on $69.22 million of
revenue for the three months ended Dec. 31, 2010, compared with a
net loss of $15.55 million on $66.65 million of revenue for the
same period during the prior year.
The Company also reported a net loss of $12.51 million on $414.42
million of revenue for the nine months ended Dec. 31, 2010,
compared with a net loss of $6.77 million on $412.13 million of
revenue for the same period during the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $657.79
million in total assets, $624.51 million in total liabilities and
Stockholders' equity of $33.28 million.
A full-text copy of the Form 10-Q filed with the U.S. Securities
and Exchange Commission is available for free at:
http://ResearchArchives.com/t/s?7501
About Nebraska Book
Headquartered in Lincoln, NE, Nebraska Book Company is a leading
operating of on-campus and off-campus college bookstores.
Revenues in the last 12-month period ending Dec. 31, 2010, were
approximately $608 million.
The Company reported a $16.3 million net loss for the quarter
ended Dec. 31 on net revenue of $69.2 million. The operating loss
was $13.3 million.
NBC Acquisition carries a 'Caa1' corporate family rating and
'Caa2' probability of default rating, with developing outlook,
from Moody's Investors Service.
In February 2011, Moody's said the downgrade of the PDR from
'Caa1' to 'Caa2' reflects the heightened default risk for the
company, which could include a transaction that Moody's would deem
a distressed exchange, as NBC faces significant near term debt
maturities. Substantially all debt of Nebraska Book Company (the
operating entity) matures before March 15, 2012. And because
other securities will mature during 2011, Moody's believes the
company must implement a comprehensive refinancing of its capital
structure over the next six to nine months.
The developing outlook reflects the uncertainty around NBC's
ability to execute a refinancing plan in the very near term.
NBC Acquisition Corp. and its Nebraska Book Co. operating
subsidiary hired legal and financial advisers to help in
restructuring debt and preparing for a Chapter 11 filing if
necessary, Bill Rochelle, Bloomberg News' bankruptcy columnist,
reported early this month, citing people familiar with the talks.
NCO GROUP: Seeks to Amend $704 Million of Credit Facility
---------------------------------------------------------
NCO Group Inc. has requested its lenders to amend certain terms of
its existing senior secured credit facilities. The facilities
include a $100.0 million revolving credit facility due November
2011 and a $604.0 million term loan B facility due May 2013. The
existing facilities are expected to be amended to, among other
things:
-- obtain a waiver for the financial covenants for the period
ended Dec. 31, 2010 and adjust certain future financial
covenants, including increasing maximum leverage ratios and
decreasing minimum interest coverage ratios;
-- reduce the revolving credit facility to $75 million and
extend the maturity date from November 2011 to Dec. 31,
2012; and
-- permit the Company to sell all or a portion of its
portfolios of purchased accounts receivable.
A copy of the selected portions of information that NCO expects to
disclose to current lender participants in NCO's senior secured
credit facilities in connection with the amendment is available
for free at http://ResearchArchives.com/t/s?74ea
The information includes certain information concerning NCO's
results of operations, financial condition and other data as of
and for the year ended Dec. 31, 2010 as well as certain
assumptions, estimates and projections with respect to NCO's
anticipated performance in 2011.
The information concerning NCO's 2010 results of operations and
financial condition is preliminary, has not been audited and is
subject to change, including the impact, if any, from the
completion of the annual tests for impairment of intangible
assets.
The information concerning NCO's anticipated performance in 2011
reflect various estimates and assumptions by NCO concerning
anticipated results, which estimates and assumptions are uncertain
and difficult to predict, and many of which are beyond NCO's
control. As a result, such information may prove not to be
reflective of actual results.
NCO is organized into three operating divisions: Accounts
Receivable Management, Customer Relationship Management and
Portfolio Management.
About NCO Group Inc.
Based in Horsham, Pennsylvania, NCO is a global provider of
business process outsourcing services, primarily focused on
accounts receivable management and customer relationship
management. NCO has over 25,000 full and part-time employees who
provide services through a global network of over 100 offices.
The company is a portfolio company of One Equity Partners and
reported revenues of about $1.2 billion for the twelve month
period ended Sept. 30, 2007.
As reported by the Troubled Company Reporter on Feb. 2, 2011,
Moody's Investors Service downgraded NCO Group, Inc.'s CFR to Caa1
from B3 and changed the outlook to negative. Simultaneously,
Moody's has also downgraded each of NCO's debt instrument ratings
by one notch and lower the Speculative Grade Liquidity rating to
SGL-4 from SGL3. The downgrade reflects Moody's concern that
greater than expected revenue declines and continued earnings
pressure will extend beyond current levels due to deteriorating
consumer payment patterns and weaker volumes. In addition,
Moody's expects financial flexibility will be further aggravated
by tightening headroom under its financial covenants and a
potential breach of covenants which will limit the company's
ability to draw upon its revolver. Also, the company faces an
impending maturity on its $100 million senior secured revolving
credit facility due November of 2011.
NEW HORIZONS: Case Summary & 15 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: New Horizons Diagnostic Corporation
9110 Red Branch Road, Suite B
Columbia, MD 21045
Bankruptcy Case No.: 11-14944
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
District of Maryland (Baltimore)
Judge: James F. Schneider
Debtor's Counsel: Karen H. Moore, Esq.
DAVIS, AGNOR, RAPAPORT & SKALNY, LLC
10211 Wincopin Circle, 6th Floor
Columbia, MD 21044
Tel: (410) 309-0505
E-mail: kmoore@darslaw.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 15 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/mdb11-14944.pdf
The petition was signed by Lawrence Loomis, president.
NEW STREAM: Files for Chapter 11 with Prepackaged Plan
------------------------------------------------------
New Stream Capital LLC and three affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 11-10753) on March 13,
2011, together with a prepackaged plan of reorganization.
Michael Buenzow, of FTI Consulting, Inc., and currently chief
restructuring officer of the Debtors, say the Chapter 11 cases
have been filed to resolve claims relating to New Stream's
investors, who provided New Stream's capital by making secured
loans through three feeder funds.
Before seeking bankruptcy protection, New Stream negotiated a plan
of reorganization with creditors. The prepackaged plan was
"overwhelmingly approved" by investors.
The Debtors have proposed that the Court hold a combined hearing
on adequacy of disclosure statement and prepetition solicitation
procedures, and the confirmation of the Prepackaged Plan. The
Debtors propose that the combined hearing be set as soon as
practicable between the dates of April 21, 2011 and May 3, 2011.
In order to meet the timeline in a Plan Support Agreement and the
post-petition financing, the hearing to consider confirmation must
take place not later than May 12, 2011.
New Stream Entities
New Stream is an inter-related group of companies that
collectively comprise an investment fund, headquartered in
Ridgefield, Connecticut. Founded in 2002, New Stream focuses on
providing non-traded private debt to the insurance, real estate
and commercial finance sectors.
Debtor New Stream Secured Capital, LLC - NSSC -- is the "master
fund" and the primary operating entity of New Stream. All of the
working capital for the investments made by NSSC was provided by
investors that invested through one of three "feeder funds."
Debtor New Stream Secured Capital, Inc. -- NSCI -- is a holding
company through which the US/Cayman Funds hold the limited
partnership interests in NSSC.
Two of the feeder funds, one in Bermuda (New Stream Capital Fund
Limited) and the other in the Cayman Islands, were vehicles for
investments made by nonresident aliens and foreign entities. The
third feeder fund is the vehicle through which U.S. residents made
investments.
The Bermuda Fund is not a debtor in the Chapter 11 cases.
However, it is in a judicial liquidation proceeding in Bermuda.
None of the Cayman Funds is a debtor in the Chapter 11 cases;
however, on March 8, 2011, an involuntary Chapter 11 petition was
filed against two of the Cayman Funds
New Stream Capital, LLC -- NSC -- a Delaware limited liability
company, is an unregistered investment adviser and asset
management company that serves, among other roles, as the general
partner and investment manager for NSSC. It is also the sole
member of New Stream Capital Services LLC.
Each of eight first-tier subsidiaries of NSSC owns a portfolio of
particular investments. Debtor New Stream Insurance, LLC ("NSI"),
one of the subsidiaries, owns a portfolio consisting of insurance-
related investments, primarily interests in companies and
partnerships that invest in life settlements.
NSC is the general partner of, and acts as the investment manager
of, NSSC. NSC is indirectly owned and managed by three
individuals, David Bryson, Bart Gutekunst and Donald Porter, who
had jointly constituted the Debtors' senior management team.
ROAD TO CHAPTER 11
In an affidavit in support of customary first day motions,
Mr. Buenzow said that since 2005, NSSC and its subsidiaries have
invested in a specialized portfolio that yielded positive returns
for investors.
Mr. Buenzow relates that in late September 2008, a series of fund
failures (most notably, the allegedly fraudulent "Ponzi Scheme"
funds run by Thomas Petters and by Bernard Madoff) had an adverse
effect on many of the Debtors' investors even though there was no
connection to New Stream. Other events during September 2008,
including the collapse of Lehman Brothers and the near failure of
several other financial institutions, compounded this negative
effect, resulting in a substantial number of redemption requests
by the Debtors' investors, comprising 60% of the value of the
Debtors' feeder funds (40% during just the month of September,
2008).
In October 2008, the Debtors took actions in the US Fund and the
Cayman Funds to reject all the redemption requests.
On Nov. 28, 2008, AVS Underwriting LLC, the largest rating agency
for life settlements, extended its views on mortality and life
expectancies, which reduced the implicit value of the life
settlements held by NSI. Over the following three months,
secondary sales of life settlements progressively dried up.
By late February 2009, the combination of the uncertainty around
policy values and the general market illiquidity effectively shut
down the life settlement market.
The Debtors took a markdown against the NSI Insurance Portfolio,
which was valued at $194 million in November 2008, resulting in
$71 million of unrealized losses for NSSC at Dec. 31, 2008.
2009 Restructuring
During April and May 2009, the Debtors attempted to negotiate a
restructuring of their relationships with investors. The Debtors,
however, were unable to liquidate assets and distribute available
funds in the manner anticipated by the 2009 Restructuring after
two Bermuda Fund investors who had not consented to the 2009
Restructuring commenced litigation in the Supreme Court of
Bermuda.
On June 8, 2010, one of those Bermuda Fund investors obtained a
judgment declaring that the terms of the 2009 Restructuring did
not apply to Segregated Account Class C or Segregated Account
Class I. The Bermuda Court appointed a receiver, John McKenna, to
act on behalf of Segregated Account Class C and Segregated Account
Class I. As a result, NSC, in its capacity as the investment
manager for the Bermuda Fund, caused the Bermuda Fund to petition
the Bermuda Court for the appointment of a receiver to act on
behalf of the other Bermuda Segregated Account Classes. The
Bermuda Court appointed Michael Morrison and Charles Thresh of
KPMG Advisory Limited, as interim joint receivers for Segregated
Account Classes B, E, H, K, L, N and O of the Bermuda Fund. On
Sept. 13, 2010, acting by ex parte summons, the Bermuda Fund
Receivers asked the Bermuda Court to order the winding-up of the
Bermuda Fund under the provisions of the Bermuda Companies Act.
That same day, the Bermuda Court appointed Messrs. Morrison,
Thresh and McKenna as the Joint Provisional Liquidators of the
Bermuda Fund. On October 7, 2010, the Bermuda Court ordered that
the Bermuda Fund be wound up under the provisions of Bermuda
Companies Act and confirmed the appointment of the Joint
Provisional Liquidators.
Financing, Sale of NSI Portfolio
On May 3, 2010, NSI engaged Guggenheim Securities, L.L.C., an
independent investment bank with extensive experience in the life
settlement market, to help the Debtors explore financing
opportunities for the NSI Insurance Portfolio. However,
solicitation for a $200 million financing was suspended after
entry of the Bermuda Judgment.
Since the appointments of the Bermuda Fund Receivers, the Debtors
have been in negotiations with them, as the court-appointed
representatives of the Bermuda Fund Segregated Account Classes,
concerning an orderly liquidation of the Debtors.
The Bermuda Judgment made it impossible for the Debtors to obtain
financing for the insurance premiums from a third-party lender on
commercially reasonable terms. On July 20, 2010, a meeting was
held among the Debtors, the Bermuda Fund Receivers and
representatives of Bermuda Fund investors, at which a decision was
reached to cease efforts to obtaining financing and instead to
explore an outright sale of NSI's life settlements.
Between July 23, 2010 and July 28, 2010, Guggenheim worked with
each of the parties who had expressed interest in, or made offers
for, the NSI Insurance Portfolio, including MIO Partners, Inc., a
Delaware corporation and an affiliate of several investors in the
US Fund and Cayman Funds. On July 29, 2010, the evaluation
process concluded with Guggenheim recommending the acceptance of
the offer made by MIO (who assigned its rights as purchaser to
Limited Life Assets Master Limited and Limited Life Assets
Holdings Limited) to purchase the entire portfolio for a cash
payment of $127.5 million.
After parties failed to close on the sale by Sept. 30, 2010, the
Purchaser agreed to (i) extend the timeline for closing, (ii)
increase the principal amount of the "price neutral" bridge
financing from $25 million to $39,480,269, which has been used to
finance the premiums and maintain the value of the NSI Insurance
Portfolio pending the filing of these cases, and (iii) offer
$15 million of postpetition financing under a "price neutral"
debtor-in-possession credit facility.
The Debtors have already received the benefit of prepetition
financing of $39,480,269 plus an additional $1,815,184 (both used
for to fund on-going premium payments pending the sale of the NSI
Insurance Portfolio). In addition, the Purchaser has committed to
fund up to an additional $15,000,000 during the pendency of the
Chapter 11 Cases. In order for a sale to any party other than the
Purchaser to be of greater value to the Debtors' estates, it would
require a purchase price of up to $184,350,000, the effective
purchase price to be paid by the Purchaser.
DEBT OBLIGATIONS
Over the last eight years, NSSC has invested primarily by making
loans and equity investments. The aggregate indebtedness secured
by the investment portfolio of NSSC is approximately $688,412,974.
This debt is divided into two tranches. The secured claims of the
NSSC Bermuda Lenders, in the approximate amount of $369,066,322,
have first priority over the secured claims of the Cayman Fund and
US Fund, which are parri passu; the claims of the Cayman Fund and
US Fund aggregate $319,346,652.
NSI is indebted to certain segregated account classes of the
Bermuda Fund in the approximate amount of $81,573,376.
PREPACKAGED PLAN
According to Mr. Buenzow, differing perspectives on the allocation
of asset value among these investors lie at the heart of these
cases. "These differences brought the Debtors' activities to a
standstill and surrounded the Debtors with an aura of uncertainty
that made it impossible to raise capital and perpetuated an
escalating cycle of redemption requests, all of which undermined
the Debtors' ability to operate."
Over the last several months, the Debtors negotiated the details
of the reorganization centered on a closing of the Insurance
Portfolio Sale and an allocation of the net proceeds among the
Debtors' creditors.
The Debtors have successfully negotiated the prepackaged
reorganization that is embodied in the Debtors' Joint Plan of
Reorganization under Chapter 11 of the Bankruptcy Code, dated
January 24, 2011. The Debtors concluded a solicitation of all of
the impaired classes of creditors, and these creditors have voted
in favor the Plan.
The Plan is predicated on a rapidly executed sale of NSI's
portfolio of life settlement contracts on the terms set forth in
the asset purchase agreement. The Plan provides for both the
implementation of this asset sale and the allocation of the net
proceeds among the Debtors' secured creditors.
"Although many of the Debtors' investors, primarily hedge funds
and other sophisticated investors, will recover only a portion of
their investment, the vast majority have agreed to accept the Plan
since the alternatives to confirmation are far less attractive,"
Mr. Buenzow says.
The Plan provided for the sale of the NSI Insurance Portfolio
either pursuant to a "Consensual Process" or a "Cramdown Process".
However, since Class 3 (which is described more fully in 104,
infra) has voted to accept the Plan, the sale will take place
pursuant to the Consensual Process and the Debtors do not
presently intend to seek approval of the Insurance Portfolio Sale
pursuant to Section 363 of the Bankruptcy Code prior to seeking
confirmation of the Plan.
The Plan treats creditors as follows:
-- NSI Bermuda Lenders under Class 1, owed $81,573,376, which
have voted to accept the plan, will receive less than the
full amount owed. Payment will be from the net proceeds of
the Insurance Portfolio Sale
-- NSSC Bermuda Lenders under Class 2, owed $396,066,322,
which hold a first lien on the investment portfolio of
NSSC, will (1) receive will receive a distribution from the
remaining proceeds of the Insurance Portfolio Sale and (2)
substantially all of the remainder of NSSC's assets, except
for certain assets that are being released for the benefit
of the Class 3 Claims. They voted in favor the Plan.
-- All holders of US-Cayman Claims, under Class 3, in the
aggregate amount of $319,346,653, will each receive a
percentage share of periodic distributions of the net
proceeds from the liquidation of the common stock of North
Star Financial Services Limited and specific assets and
certain real estate and commercial loans (collectively
identified as USC Wind Down Assets). In addition, holders
of Class 3 Claims who voted to accept the Plan, and thereby
grant the third-party releases provided for in section 12.5
of the Plan, will be entitled to receive a cash payment
from the Global Settlement Fund upon the Plan's Effective
Date. Under the Global Settlement, the Purchaser and
Creditors in Classes 1 and 2, in exchange for the "yes"
vote and the third-party releases, have agreed to provide
funding for cash payments (expected to aggregate
$15 million) to Class 3 claimants.
-- Holders of general unsecured claims against NSI and NSCI,
under Classes 4(a) and (d), will be paid in full and are
not impaired under the Plan. Each holder of allowed
general unsecured claim against NSC, in Class 4(c), will
share, on a pro rata basis, in a cash distribution of.
Holders of general unsecured claims against NSSC, in Class
4(b), will not receive any distribution or retain any
property on account of such Claims and pursuant to
Bankruptcy Code Sec. 1126(g) this Class is deemed not to
have accepted the Plan.
-- Holders of the Class 5(a) Interests in NSI that are
currently held by NSSC will continue to be held by NSSC and
the Class 5(d) Interests in NSCI that are currently held by
the Cayman Funds will continue to be held by the Cayman
Funds. Class 5(b) Interests in NSSC and Class 5(c)
Interests in NSC will be extinguished and the Holders of
Interests in Class 5(b) and Class 5(a) shall not receive or
retain any property on account of such Interests.
Each holder of a claim in Classes 1, 2, 3 and 4(c) was entitled to
vote either to accept or reject the Plan
A copy of the Plan is available for free at:
http://bankrupt.com/misc/NewStream_Plan.pdf
A copy of the Disclosure Statement explaining the terms of the
Plan is available for free at:
http://bankrupt.com/misc/NewStream_DS.pdf
The Debtor is represented by Kurt F. Gwynne, Esq., at Reed Smith
LLP, in Wilmington, Delaware, as counsel.
Kurtzman Carson Consultants LLC is the Notice, Claims and
Solicitation Agent.
Three U.S./Cayman Funds Involuntaries
On March 7, 2011, when New Stream was still soliciting votes on
the Chapter 11 plan, certain investors filed a petition (Bankr. D.
Del. Lead Case No. 11-10690) seeking to force three new stream
funds -- New Stream Secured Capital Fund (U.S.) LLC, New Stream
Secured Capital Fund P1 (Cayman), Ltd. and New Stream Secured
Capital Fund K1 (Cayman), Ltd. -- to Chapter 11 bankruptcy.
The petitioning investors in the New Stream investment enterprise
say they are collectively owed over $90 million, representing
roughly 28% of the approximately $320 million owed to all U.S. and
Cayman investors.
The Investors filed together with the petitions a request for an
immediate appointment of a Chapter 11 trustee to take over
management of the assets. The prepackaged plan offered by New
Stream, according to the Investors, "offers a mere pittance to the
US/Cayman Investors, funded primarily with 'gifts' from allegedly
senior classes traceable to funds supplied by the US/Cayman
Investors in the first place; gives the Bermuda feeder fund, the
purported senior lien holder, the vast majority of all plan
distributions; and grants releases to all wrongdoers; this after
admitting to losing almost $500 million on assets that the Fund
Manager valued at $800 million less than three years ago."
The Petitioners are represented by (i) Joseph H. Huston, Jr.,
Esq., Maria Aprile Sawczuk, Esq., Meghan A. Cashman, Esq., at
Stevens & Lee, P.C., in Wilmington, Delaware, and Beth Stern
Fleming, Esq., at Stevens & Lee, P.C., in Philadelphia,
Pennsylvania, and Nicholas F. Kajon, Esq., David M. Green, Esq.,
and Constantine Pourakis, Esq., at Stevens & Lee, P.C., in New
York, (ii) Edward Toptani, Esq., at Toptani Law Offices, in New
York, and (iii) John M Bradham, Esq., and David Hartheimer, Esq.,
at Mazzeo Song & Bradham LLP, in New York.
NEW STREAM: Case Summary & Largest Unsecured Creditors
------------------------------------------------------
Debtor: New Stream Secured Capital, Inc.
38C Grove Street
Ridgefield, CT 06877
Bankruptcy Case No.: 11-10753
Debtor-affiliates that filed for Chapter 11:
Entity Case No.
------ --------
New Stream Insurance, LLC 11-10754
New Stream Capital, LLC 11-10755
New Stream Secured Capital, L.P. 11-10756
Chapter 11 Petition Date: March 13, 2011
Court: U.S. Bankruptcy Court
District of Delaware (Delaware)
About the Debtors: New Stream is an inter-related group of
companies that collectively comprise an
investment fund, headquartered in Ridgefield,
Connecticut. Founded in 2002, New Stream
focuses on providing non-traded private debt to
the insurance, real estate and commercial
finance sectors.
Debtors' Counsel: Kurt F. Gwynne, Esq.
J. Cory Falgowski, Esq.
REED SMITH LLP
1201 Market Street, 15th Floor
Wilmington, DE 19801
Tel: (302) 778-7550
Fax: (302) 778-7575
E-mail: kgwynne@reedsmith.com
- and -
Michael J. Venditto, Esq.
REED SMITH LLP
599 Lexington Avenue
New York, NY 10022
Tel: (212) 521-5400
Fax: (212) 521-5450
- and -
Scott M Esterbrook, Esq.
REED SMITH LLP
2500 One Liberty Place
Philadelphia, PA 19103
Tel: (215) 851-8146
Fax: (215) 851-1420
Debtors'
Claims & Notice
Agent: KURTZMAN CARSON CONSULTANTS LLC
Counsel for
Joint
NSSC Receivers: Timothy Q. Karcher, Esq.
DEWEY & LEBOEUF LLP
1301 Avenue Of The Americas
New York, NY 10019
Counsel for MIO,
the Purchaser,
the Note Lenders
and the
DIP Lenders: Robin E. Keller, Esq.
HOGAN LOVELLS US LLP
875 Third Avenue
New York, NY 10022
Counsel for
McKenna: Emanuel C. Grillo, Esq.
GOODWIN PROCTER LLP
The New York Times Building
620 8th Avenue
New York, New York 10018
Estimated Assets & Debts*:
(in millions)
Debtor Assets Liabilities
------ ------ -----------
NSSC, Inc. $0 to $0.05 $0 to $0.05
NSC $0.1 to $0.50 $0.05 to $0.10
NSI $100.0 to $500.00 $50.00 to $100.00
NSSC, LP $500.0 to $1,000.00 $500.00 to $1,000.00
* NSI's insurance portfolio is being sold for $184,350,000 as
part of the Chapter 11 plan. The aggregate indebtedness
secured by the investment portfolio of NSSC is $688,412,974.
NSI owes $81,573,376 to certain account classes under a
Bermuda fund.
The petitions were signed by Michael Buenzow, chief restructuring
officer.
Debtor-affiliates also subject to involuntary Chapter 11 petitions
(Bankr. D. Del.) commenced on March 7, 2011 by certain investors:
Debtor Case No.
------ --------
New Stream Secured Capital Fund (U.S.), L.L.C. 11-10690
New Stream Secured Capital Fund P1 (Cayman), Ltd. 11-10694
New Stream Secured Capital Fund K1 (Cayman), Ltd. 11-10696
The Joint NSSC Receivers refer to Michael Morrison and Charles
Thresh, of KPMG Advisory Limited, in their capacity as joint
receivers for Segregated Account Classes B, E, H, K, - 20 - L, N
and O of the Debtors' Bermuda Fund appointed pursuant to orders of
the Bermuda Court in the Bermuda Proceedings on June 18, 2010 and
July 16, 2010. McKenna is receiver appointed by the Bermuda Court
on behalf of Segregated Account Class C and Segregated Account
Class I. MIO, the Purchaser, the Note Lenders and the DIP Lenders
refer to the MIO Partners, Inc.-led entities that are pursuing to
purchase NSI's insurance portfolio.
New Stream Secured Capital's list of unsecured creditors filed
together with its petition contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
SPAR, LP Litigation Claim $1
261 Madison Avenue, 12th Floor for Commissions
New York, NY 10016
NEXEN INC: Moody's Confirms 'Ba1' Rating to Subordinated Notes
--------------------------------------------------------------
Moody's Investors Service confirmed Nexen Inc.'s Baa3 senior
unsecured rating and its Ba1 subordinated rating. This concludes
the review for downgrade that began on December 7, 2011. The
rating outlook is negative.
"The confirmation of Nexen's Baa3 senior unsecured rating reflects
management's commitment to debt reduction sufficient to restore
leverage metrics to levels more commensurate with a Baa3 rating.
Moody's believe that Nexen has the wherewithal to reduce debt over
the course of the next year in an amount sufficient to lower its
ratio of debt to production to US$20,000/boe, a level sufficient
to retain the Baa3 rating given Nexen's oil-weighted production.",
said Terry Marshall, Moody's Senior Vice President.
"The negative outlook considers the execution risk of retiring the
debt necessary to meet the US$20,000/boe debt to production metric
while retaining sufficient operating cash levels to fund potential
negative free cash flow. Moody's estimate that the debt reduction
required will be about $1.5 billion, but meeting the metric will
be contingent upon production levels. Nexen will clearly benefit
from currently very high oil prices, but its significant capex
program, coupled with uncertainty about the ramp-up at Long Lake
and potential negative free cash flow at that operation, may leave
the company needing the excess cash flow from high oil prices to
cover capital expenditures."
Nexen's Baa3 senior unsecured rating reflects its ability to
generate strong netbacks owing to an oil-weighted product mix, its
production platform of about 200,000 boe/day, and the value of its
ownership positions in Horn River shale gas, the Syncrude (7.23%)
mining and upgrading operation, as well as its Gulf of Mexico and
North Sea operations. However, the rating also considers Nexen's
very high debt level and high leverage in terms of production and
reserves, high capex, the uncertainty surrounding the ability of
Long Lake to meet production and economic targets in a timely
manner, and a concentrated production platform, with approximately
55% of production derived from the challenging operating
environment in the North Sea, although this contributes
significantly to the company's ability to take advantage of the
currently high Brent price.
Notwithstanding material debt reduction in 2010, Nexen's debt to
production remains very high as Long Lake production has remained
below expectations and operational issues in the North Sea
combined to hold 2010 production to 216,000 barrels of oil
equivalent per day (boe/day). Nexen's debt to production
(US$26,424) and debt to proved developed reserves metrics
(US$12.82/boe) map to low B and Caa indicated rating categories,
respectively under Moody's Independent Exploration and Production
(E&P) Industry rating methodology.
Approximately 80% of Nexen's production is derived from oil, with
good netbacks, resulting in a favorable unleveraged cash margin of
about $55/boe in 2010, a margin that should increase in 2011 given
sharply higher oil prices to date. This supports a higher level
of debt than companies with a less oil-weighted production
profile. However, current levels of debt and production are not
supportable even considering Nexen's favorable netbacks and oily
production.
The negative outlook could be restored to stable upon the
reduction of the ratio of debt to production below US$20,000/boe
while continuing to produce favorable unleveraged cash margins.
It would also be necessary that Nexen retain a cash position
sufficient to ensure that it would not need to fund potential
negative free cash flow with increases in debt for the foreseeable
future. A debt to production metric of US$20,000/boe is above the
Baa3 range of approximately US$16,000 to US$18,000/boe for this
metric, but would be acceptable given Nexen's oil-weighted
production and reserves. The rating could be lowered if debt to
production does not appear poised to improve to the above level by
late 2011 or early 2012. An upgrade in rating is unlikely in the
near term, but could eventually occur if Long Lake achieves
meaningful positive fee cash flow, Usan (offshore Nigeria) ramps
up successfully in 2012, and metrics are substantially in line
with Baa2 peers.
Nexen Inc. is a Calgary, Alberta based oil & gas exploration and
production company that at the end of 2010 had 918.5 million
barrels of oil equivalent net proved reserves (92% oil and 49%
developed) and produce over 200,000 boe/day (80% oil).
NEXSTAR BROADCASTING GROUP: Incurs $1.81-Mil. Net Loss in 2010
--------------------------------------------------------------
Nexstar Broadcasting Group, Inc. reported net income of $14.27
million on $97.05 million of net revenue for three months ended
Dec. 31, 2010, compared with net income of $967,000 on $73.96
million of net revenue for the same period during the prior year.
The Company reported a net loss of $1.81 million on
$313.35 million of net revenue for the twelve months ended Dec.
31, 2010, compared with a net loss of $12.61 million on $251.98
million of net revenue during the prior year.
Perry A. Sook, Chairman, President and Chief Executive Officer of
Nexstar Broadcasting Group, Inc., commented, "Nexstar's record
quarterly financial results highlight our significant revenue
diversification progress which drove the highest quarterly results
in the company's history. Our success in driving profitable
revenue growth reflects the strength of our core local content,
ability to develop distribution and digital extensions for our
core content including the creation of new online, text and mobile
content and applications, and the benefit derived from leveraging
our management operating disciplines to provide services to other
broadcasters. Further illustrating the momentum of our revenue
diversification strategies, fourth quarter 2010 net revenue rose
20.9% over the same period in 2008, which was a Presidential
election year. Strength in core television advertising trends --
which began for Nexstar in the 2009 fourth quarter -- is
continuing in 2011 and we are well positioned to further grow all
of our non-political revenue sources throughout 2011."
A full-text copy of the press release announcing the financial
results is available for free at:
http://ResearchArchives.com/t/s?74ee
About Nexstar Broadcasting Group
Irving, Texas-based Nexstar Broadcasting Group Inc. currently
owns, operates, programs or provides sales and other services to
62 television stations in 34 markets in the states of Illinois,
Indiana, Maryland, Missouri, Montana, Texas, Pennsylvania,
Louisiana, Arkansas, Alabama, New York, Rhode Island, Utah and
Florida. Nexstar's television station group includes affiliates
of NBC, CBS, ABC, FOX, MyNetworkTV and The CW and reaches
approximately 13 million viewers or approximately 11.5% of all
U.S. television households.
The Company's balance sheet at Sept. 30, 2010, showed
$607.58 million in total assets, $797.43 million in total
liabilities, and a stockholders' deficit of $189.85 million.
* * *
As reported by the Troubled Company Reporter on August 30, 2010,
Standard & Poor's Ratings Services raised its corporate credit
rating on Nexstar Broadcasting Group to 'B' from 'B-'. The rating
outlook is stable.
"The 'B' corporate credit rating reflects S&P's expectation that
Nexstar's core ad revenue will continue growing modestly in 2010
and 2011," said Standard & Poor's credit analyst Deborah Kinzer.
The EBITDA growth resulting from the rebound in core advertising,
combined with political ad revenue from the 2010 midterm
elections, should, in S&P's view, enable Nexstar to reduce its
leverage significantly by the end of the year.
NW358, LLC: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: NW358, LLC
3455 Cliff Shadows Parkway, Suite 220
Las Vegas, NV 89129
Bankruptcy Case No.: 11-13424
Debtor-affiliates that simultaneously filed for Chapter 11
protection:
Entity Case No.
------ --------
C-NW361, LLC 11-13431
C-NW362, LLC 11-13435
C-SWDE382, LLC 11-13438
C-SWDE383, LLC 11-13440
C-SWDE384, LLC 11-13442
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Mike K. Naka.
Debtor's Counsel: I. Scott Bogatz, Esq.
BOGATZ & ASSOCIATES, P.C.
3455 Cliff Shadows Parkway, Suite 110
Las Vegas, NV 89129
Tel: (702) 776-7000
Fax: (702) 776-7900
E-mail: rpoll@isbnv.com
Estimated Assets: $1,000,001 to $10,000,000
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 Thomas J. DeVore, chief operating
officer of LEHM, LLC, manager.
Debtor-affiliates that previously filed separate Chapter 11
petitions:
Entity Case No. Petition Date
------ -------- -------------
B-SWDE3, LLC 09-29051 10/09/09
B-PVL1, LLC 09-29147 10/12/09
A-SWDE1, LLC 09-34216 12/29/09
A-JVP1, LLC 09-34236 12/29/09
B-SWDE2, LLC 09-33470 12/15/09
B-NWI1, LLC 10-15774 04/02/10
B-JVP1, LLC 10-16641 04/16/10
B-VLP2, LLC 10-16660 04/16/10
B-PVL2, LLC 10-16648 04/16/10
B-VLP1, LLC 10-16655 04/16/10
B-VV1, LLC 10-18284 05/05/10
A-NGAE1, LLC 10-18719 05/12/10
B-SWDE6, LLC 10-30194 10/27/10
B-SWDE7, LLC 10-30199 10/27/10
B-SCT2, LLC 10-31307 10/10/10
B-SCT1, LLC 11-11560 02/04/11
G-SWDE1, LLC 11-11991 02/14/11
NORTEL NETWORKS: Completes Sale of MSS Business to Ericsson
-----------------------------------------------------------
Nortel Networks Corporation announced that it, its principal
operating subsidiary Nortel Networks Limited, and certain of its
other subsidiaries, including Nortel Networks Inc. and Nortel
Networks UK Limited, have completed the sale of substantially all
of the assets of Nortel's Multi Service Switch (MSS) businesses
globally to Telefonaktiebolaget LM Ericsson for a cash purchase
price of US$65 million subject to working capital and other
adjustments.
Substantially all MSS employees are joining Ericsson, including
those in certain EMEA jurisdictions who are transferring to
Ericsson by operation of law.
"The sale of Nortel's Multi Service Switch business represents
another major milestone," said George Riedel, Chief Strategy
Officer and President, Business Units, Nortel. "Ericsson will
preserve our rich heritage of innovation, expertise and talent to
serve a growing customer base. We wish everyone lasting success."
As previously announced, Nortel does not expect that the Company's
common shareholders or the NNL preferred shareholders will receive
any value from the creditor protection proceedings and expects
that the proceedings will result in the cancellation of these
equity interests.
About Nortel Networks
Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was
once North America's largest communications equipment provider.
It has sold most of the businesses while in bankruptcy.
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. Fred S. Hodara, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, in New York, and
Christopher M. Samis, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represent the Official Committee of
Unsecured Creditors.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. On May 28, 2009, at the request
of the Administrators, the Commercial Court of Versailles, France
ordered the commencement of secondary proceedings in respect of
Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited
filed petitions in this Court for recognition of the English
Proceedings as foreign main proceedings under chapter 15 of the
Bankruptcy Code.
Nortel Networks divested off key assets while in Chapter 11.
In March 2009, the U.S. Bankruptcy Court entered an order
approving the sale of the Layer 4-7 assets to Radware Ltd. as the
successful bidder at auction. In July 2009, Nortel sold its CDMA
and LTE-related assets to Telefonaktiebolaget LM Ericsson (Publ).
In September 2009, the Court Nortel sold its Enterprise Solutions
business to Avaya Inc. In October 2009, the Court approved the
sale of assets associated with Nortel's Next Generation Packet
Core network components to Hitachi, Ltd. On December 2, 2009, the
Court approved the sale of assets associated with Nortel's
GSM/GSM-R business to Telefonaktiebolaget LM Ericsson (Publ) and
Kapsch Carriercom AG. In December 2009, the Debtors sold their
Metro Ethernet Networks business to Ciena Corporation. In March
2010, Nortel sold its Carrier Voice Over IP and Application
Solutions business to GENBAND Inc. In September 2010, Nortel sold
its Multi-Service Switch business to Ericsson.
Nortel Networks has filed a proposed plan of liquidation in the
U.S. Bankruptcy Court. The Plan generally provides for full
payment on secured claims with other distributions going in
accordance with the priorities in bankruptcy law.
ORANGE GROVE: Hiring Jerome Cohen as Replacement Ch. 11 Counsel
---------------------------------------------------------------
Orange Grove Service, Inc., is seeking permission from the
Bankruptcy Court to employ Jerome S. Cohen as its bankruptcy
counsel:
Jerome S. Cohen, Esq.
3731 Wilshire Blvd Suite 514
Los Angeles, CA 90010
Tel: 213-388-8188
Fax: 213-388-6188
E-mail: jsc@jscbklaw.com
Mr. Cohen replaces Ori S. Blumenfeld, Esq., at Wilson & Associates
LLP:
Ori S. Blumenfeld, Esq.
WILSON & ASSOCIATES LLP
10940 Wilshire Blvd Suite 1600
Los Angeles, CA 90024
Tel: 310-220-4902
Fax: 310-443-4296
E-mail: ori.blumenfeld@bankruptcypower.com
The Cohen firm attests that neither the Firm, nor any of its
attorneys, has any connection with the Debtor, the Debtor's other
attorneys or accountants, the Debtor's creditors, or any other
outside party in interest, or their attorneys or accountants. The
Firm is a "disinterested person" within the meaning of Section
101(14) of the Bankruptcy Code. The Firm does not have an
interest adverse to the Debtor or the Estate. As of the Petition
Date, the Firm was not a creditor of the Estate.
Mr. Cohen and his associates will be paid on an hourly basis:
Professional Title Rate
------------ ----- ----
Jerome S. Cohen, Esq. Principal $450
Elaine V. Nguyen, Esq. Associate $300
Scott P. Layfield, Esq. Associate $300
William Gynan, Esq. Associate $300
Kim A. Bui, Esq. Associate $300
The Debtor agreed upon an initial deposit to cover early
foreseeable fees and costs in the amount $25,000. On Feb. 10,
2011, the Debtor tendered to Mr. Cohen $30,000. Mr. Cohen intends
to transfer $5,000 to a certified public accountant selected by
the Debtor as a retainer for accounting services in the Debtor's
case.
On Dec. 30, 2010, the Former Counsel filed a disclosure statement
in the bankruptcy case. On Feb. 9, 2011, the Court denied
approval of the Debtor's Disclosure Statement, without prejudice
to revision and re-submission. On Feb. 10, 2011, after learning
that the Former Counsel was withdrawing as counsel, the Debtor
retained Mr. Cohen.
The Debtor's secured creditors, American Continental Bank and
Signal Walnut Partnership, LP, object to the hiring of the Cohen
firm. Last month, the Debtor won authority from the Court to
further use the cash collateral securing its obligations to Signal
Walnut Partnership, L.P., and to American Continental Bank through
March 31, 2011.
About Orange Grove Service
La Verne, California-based Orange Grove Service, Inc., owns and
operates 2 "strip" shopping centers, the Lemon Creek in Walnut,
Calif., and the Fremont, in Alhambra, Calif. The Company filed
for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No.
10-21336) on March 25, 2010. Matthew Abbasi, Esq., at Wilson &
Associates LLP, in Los Angeles, assists the Debtor in its
restructuring effort. In its schedules, the Debtor disclosed
$12,003,736 in assets and $11,611,337 in liabilities.
ORANGE GROVE: Has Go Signal to Hire Special Litigation Counsel
--------------------------------------------------------------
Judge Alan M. Ahart authorized Orange Grove Service, Inc., to
employ Michael R. Brown as special litigation counsel for state
court and adversarial proceedings on a contingent fee basis,
receiving compensation in an amount equal to 45% of the gross
amount recovered, plus reimbursement of actual expenses and costs
pursuant to 11 U.S.C. Sec. 328.
Michael R. Brown, Esq., will lead the engagement. He attests that
the firm does not hold any interest adverse to the Debtor or the
estate and is a disinterested person as defined in 11 U.S.C. Sec.
101(14).
About Orange Grove Service
La Verne, California-based Orange Grove Service, Inc., owns and
operates 2 "strip" shopping centers, the Lemon Creek in Walnut,
Calif., and the Fremont, in Alhambra, Calif. The Company filed
for Chapter 11 bankruptcy protection on March 25, 2010 (Bankr.
C.D. Calif. Case No. 10-21336). Matthew Abbasi, Esq., at Wilson &
Associates LLP, in Los Angeles, assists the Debtor in its
restructuring effort. In its schedules, the Debtor disclosed
$12,003,736 in assets and $11,611,337 in liabilities.
OVERSEAS SHIPHOLDING: Moody's Downgrades Issuer Rating to 'B1'
--------------------------------------------------------------
Moody's Investors Service downgraded its debt ratings of Overseas
Shipholding Group, Inc, Corporate Family and Probability of
Default to B1 from Ba2, senior unsecured to B2 from Ba3. Moody's
also affirmed the SGL-2 Speculative Grade Liquidity Rating and
changed the outlook to stable.
Downgrades:
Issuer: Overseas Shipholding Group, Inc.
-- Issuer Rating, Downgraded to B1 from Ba2
-- Probability of Default Rating, Downgraded to B1 from Ba2
-- Corporate Family Rating, Downgraded to B1 from Ba2
-- Multiple Seniority Shelf, Downgraded to (P)B2 from (P)Ba3
-- Senior Unsecured Regular Bond/Debenture, Downgraded to B2
LGD5-71 from Ba3 LGD5-73
Ratings Rationale
The downgrade of the ratings reflects Moody's expectation that
OSG's credit metrics, including leverage and interest coverage,
will be more reflective of a single B credit profile for the
foreseeable future. OSG's operating performance has been
adversely affected by weak trends in the global tanker market and
is not likely to recover to levels consistent with the Ba rating
category even as the tanker market exits the current trough. Weak
tanker rates are likely to extend at least through the first half
of 2012 because a continuing excess supply of international
tankers. Nevertheless, OSG's leading market position and good
liquidity provide it the wherewithal to meet its debt service
obligations through the current market trough. OSG has continued
to invest in its fleet, including chartering in vessels, which
lowers its cash capital needs, but helps sustain a high debt
balance on a Moody's adjusted basis. Long-running, weak tanker
market fundamentals have compounded the pressure on OSG's earnings
capacity that has accompanied its multi-year fleet diversification
strategy.
"Moody's believes that OSG's fleet diversification strategy has
increased exposure to tanker sectors that typically produce
margins and returns on assets that are lower than those generated
by OSG's traditional crude vessels trading spot," said Moody's
Shipping Analyst, Jonathan Root. Notwithstanding this shift,
Moody's believes that OSG's default probability has not increased
to the same extent that its credit metrics have weakened.
"The B1 rating balances OSG's position as a market leader in the
majority of its trades, ongoing good liquidity, high operating
leverage of the large crude carriers and anticipated improvements
in fundamentals in the Jones Act trades against weak credit
metrics," said Root. Trading the majority of the international
tankers in pools results in OSG's vessels earning relatively
higher freight rates throughout the shipping cycle because pool
trading typically increases vessel utilization. The B1 rating
also recognizes OSG's chartering policy that provides a meaningful
level of coverage of its charter-in commitments from charters-out
to creditworthy counterparties. Unrestricted cash of
approximately $250 million at December 31, 2010, about $825
million of availability on the revolver after the February 2011
step-down and comfortable cushion with financial covenants
supports the SGL-2 Speculative Grade Liquidity rating.
The downgrade of the senior unsecured rating to B2 results from
Moody's application of its Loss Given Default Rating Methodology.
The stable outlook reflects Moody's anticipation that OSG will
maintain good liquidity for the duration of the current market
trough and that its size and scope of operations strongly position
OSG to improve its financial profile once the sector exits the
trough, which is not likely to occur before the second half of
2012.
The ratings could be downgraded if OSG does not maintain an
adequate liquidity profile. Unrestricted cash sustained below
$175 million could pressure the ratings as could debt-funded
growth of the fleet. The inability to demonstrate a positive
inflection in credit metrics from the second half of 2012 could
also pressure the ratings. There is little impetus for a positive
outlook before OSG significantly strengthens its credit metrics.
The last rating action was on March 22, 2010, when Moody's
assigned a B3 rating to OSG's $300 million of unsecured notes due
2018.
Overseas Shipholding Group, Inc., headquartered in New York City,
NY, is one of the largest publicly traded tanker companies in the
world, engaged primarily in the ocean transportation of crude oil
and petroleum products.
PHILADELPHIA RITTENHOUSE: Lender iStar Takes Aim at Sale Request
----------------------------------------------------------------
Dow Jones' DBR Small Cap reports that iStar Financial Inc. is
protesting Philadelphia Rittenhouse Developer LP's plan to sell
its luxury condominium units free and clear of the lender's liens,
saying the move is an "extraordinary" and wrongful attempt by the
developer to keep property that doesn't belong to it.
About iStar Financial
New York-based iStar Financial Inc. (NYSE: SFI) provides custom-
tailored investment capital to high-end private and corporate
owners of real estate, including senior and mezzanine real estate
debt, senior and mezzanine corporate capital, as well as corporate
net lease financing and equity. The Company, which is taxed as a
real estate investment trust, provides innovative and value added
financing solutions to its customers.
* * *
iStar carries a 'C' issuer default rating from Fitch Ratings
Services. Fitch lowered, among other things, the IDR from 'CC' to
'C' in October 2010, noting that there is substantial amount of
debt maturities in the second quarter of 2011, consisting
primarily of a second lien term loan and second lien revolving
credit agreement in aggregate amounting to approximately $1.7
billion, and an unsecured revolving credit facility of
approximately $500 million. In order to avoid maturity defaults
on the second lien obligations and unsecured revolving credit
facility due June 2011, a coercive debt exchange would need to be
effected, whereby the company negotiates with certain of its debt
holders a material reduction in terms to avert bankruptcy, Fitch
said.
In July 2010, Standard & Poor's Ratings Services lowered its long-
term counterparty credit rating on iStar Financial to 'CCC' from
'B-'. The outlook is negative. iStar's limited funding
flexibility and the severe credit quality deterioration in its
loan portfolio continue to put negative pressure on the rating,
S&P said.
About Philadelphia Rittenhouse
Philadelphia Rittenhouse Developer, L.P. is a joint venture
between ARC Properties, Inc., based in Clifton, New Jersey, and
Philadelphia-based Wheeler Brothers Holdings, LLC. The Company
was formed to develop 10 Rittenhouse Square, a 33-story
condominium building in Philadelphia.
Rittenhouse filed for chapter 11 bankruptcy in response
to an action in Pennsylvania state court seeking to appoint a
receiver for the development project, which was brought by one of
the Company's lenders, iStar Tara, LLC.
Rittenhouse filed a Chapter 11 petition on Dec. 30, 2010 (Bankr.
E.D. Pa. Case No. 10-31201). Albert A. Ciardi, III, Esq., at
Ciardi Ciardi & Astin, P.C., serves as the Debtor's bankruptcy
counsel. The Debtor estimated its assets and debts at
$100 million to $500 million. iStar Tara, LLC is represented in
the chapter 11 case by the firm of Blank Rome LLP.
PJ FINANCE: Has Court OK to Hire KCC as Claims Agent
-----------------------------------------------------
PJ Finance Company, LLC, et al., sought and obtained authorization
from the U.S. Bankruptcy Court for the District of Delaware to
employ Kurtzman Carson Consultants LLC as claims, noticing and
balloting agent.
KCC will, among other things:
a. prepare and serve required notices in the Debtors' Chapter
11 cases;
b. receive, examine, and maintain copies of proofs of claim
and proofs of interest filed in the Chapter 11 cases;
c. maintain official claims registers in the Chapter 11 cases
by docketing all proofs of claim and proofs of interest in
a claims database; and
d. provide access to the public for examination of claims and
the claims register at no charge.
KCC will charge the Debtors for its services, expenses and
supplies at the rates or prices set by KCC and in effect as of the
date of KCC's service agreement with the Debtors in accordance
with the KCC Fee Structure. A copy of KCC's service agreement
with the Debtors are available for free at:
http://bankrupt.com/misc/PJ_FINANCE_claimsagentpact.pdf
The Debtors have provided KCC with a security retainer in the
amount of $25,000.
To the best of the Debtor's knowledge, KCC is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
Chicago, Illinois-based PJ Finance Company, LLC, owns apartment
communities in the states of Arizona, Florida, Georgia, Tennessee
and Texas. PJ Finance owns or holds ownership interests in 32
apartment communities that collectively have more than 9,500
rentable units. It has 20 apartment locations in Texas, and the
remaining 12 in Arizona, Florida, Georgia and Tennessee. The day-
to-day operations of the portfolio are managed by a third party,
WestCorp Management Group One, Inc.
PJ Finance filed for Chapter 11 bankruptcy protection on March 7,
2011 (Bankr. D. Del. Case No. 11-10688).
Affiliates PJ Holding Company Manager, LLC (Bankr. D. Del. Case
No. 11-10692); PJ Holding Company, LLC (Bankr. D. Del. Case No.
11-10693); Alliance PJRT GP, Inc. (Bankr. D. Del. Case No. 11-
10695); Alliance PJWE GP, L.L.C. (Bankr. D. Del. Case No. 11-
10697); Alliance PJRT Limited Partnership (Bankr. D. Del. Case No.
11-10699); and Alliance PJWE Limited Partnership (Bankr. D. Del.
Case No. 11-10700) filed separate Chapter 11 petitions.
The cases are jointly administered, with PJ Finance Company as the
lead case.
Michelle E. Marino, Esq., and Stuart M. Brown, Esq., and Edwards
Angell Palmer & Dodge, LLP, serve as the Debtors' local bankruptcy
counsel.
Richard A. Chesley, Esq., and Kimberly D. Newmarch, Esq., at
DLA Piper LLP (US), serve as the Debtors' bankruptcy counsel.
The Debtors estimated total assets of at least $275 million
(estimated value of portfolio securing loan to BankofAmerica) and
total debts of at least $479 million ($475 million owed to BofA,
$4.4 million trade debt).
PJ FINANCE: Has Court's Interim Nod to Use Cash Collateral
----------------------------------------------------------
PJ Finance Company, LLC, et al., sought and obtained interim
authorization from the Hon. Brendan L. Shannon of the U.S.
Bankruptcy Court for the District of Delaware to use the cash
collateral until March 19, 2011.
In November 2006, Alliance PJRT Limited Partnership and Alliance
PJWE Limited Partnerships entered into an amended and restated
loan agreement with Column Financial Inc., as originating lender,
whereby the Originating Lender agreed to make a loan to the
Partnerships in the principal amount of $475 million with a
Nov. 11, 2016 maturity date. In May 2007, the Originating Lender
sold the prepetition loan documents to Credit Suisse First Boston
Mortgage Securities Corp. Pursuant to that certain pooling and
servicing agreement dated May 1, 2007, Credit Suisse contributed
the prepetition loan documents to a trust. Under that agreement,
Bank of America, N.A., acts as successor trustee; Wachovia Bank,
N.A., acts as the master servicer; and Torchlight Loan Services,
LLC, acts as special servicer. The loan is secured by mortgages
and deeds of trust encumbering all of the properties in favor of
the Trustee. The Partnerships are currently indebted on the loan
in the amount of $475 million plus accrued and unpaid interest,
costs and fees.
Stuart M. Brown, Esq., at Edwards Angell Palmer & Dodge LLP,
explained that the Debtors need the money 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/PJ_FINANCE_budget.pdf
In exchange for the use of cash collateral, the Trustee and
Special Servicer, will be granted replacement liens and
superpriority administrative expense claim against each Debtor.
The adequate protection senior lies and adequate protection senior
claim will secure the payment of the adequate protection senior
obligations in an amount equal to any diminution in the value of
the Trustee's and Special Servicer's interests in the prepetition
collateral from and after the Petition Date.
Cash receipts, cash collateral, and all proceeds from the sale,
transfer or other disposition of any prepetition collateral will
be promptly deposited in the same bank accounts into which the
collections and proceeds of the prepetition collateral were
deposited under the prepetition loan documents.
The Debtors will segregate and account for all cash collateral
which is now, and which may hereafter be, in their possession,
custody or control, and other than in accordance with the budget
will not, without further court order, transfer any of the cash
collateral to any non-Debtor affiliates or subsidiaries. The
Debtors will provide the Special Services, so as actually to be
received within five business days following the end of each
weekly period, weekly line-by-line variance reports for the
preceding weekly periods and on a cumulative basis from the
Petition Date to the reports date, comparing actual cash receipts
and disbursements to amounts projected in the budget. The Special
Servicer will also be provided with reasonable access to the
Debtors' books and records related to the prepetition collateral.
The Court has set a second interim hearing for March 17, 2011, at
9:30 a.m. (Eastern time). Objections to the use of cash
collateral must be filed by March 16, 2011, at 12:00 p.m. (Eastern
time).
About PJ Finance
Chicago, Illinois-based PJ Finance Company, LLC, owns apartment
communities in the states of Arizona, Florida, Georgia, Tennessee
and Texas. PJ Finance owns or holds ownership interests in 32
apartment communities that collectively have more than 9,500
rentable units. It has 20 apartment locations in Texas, and the
remaining 12 in Arizona, Florida, Georgia and Tennessee. The day-
to-day operations of the portfolio are managed by a third party,
WestCorp Management Group One, Inc.
PJ Finance filed for Chapter 11 bankruptcy protection on March 7,
2011 (Bankr. D. Del. Case No. 11-10688).
Affiliates PJ Holding Company Manager, LLC (Bankr. D. Del. Case
No. 11-10692); PJ Holding Company, LLC (Bankr. D. Del. Case No.
11-10693); Alliance PJRT GP, Inc. (Bankr. D. Del. Case No. 11-
10695); Alliance PJWE GP, L.L.C. (Bankr. D. Del. Case No. 11-
10697); Alliance PJRT Limited Partnership (Bankr. D. Del. Case No.
11-10699); and Alliance PJWE Limited Partnership (Bankr. D. Del.
Case No. 11-10700) filed separate Chapter 11 petitions.
The cases are jointly administered, with PJ Finance Company as the
lead case.
Michelle E. Marino, Esq., and Stuart M. Brown, Esq., and Edwards
Angell Palmer & Dodge, LLP, serve as the Debtors' local bankruptcy
counsel.
Richard A. Chesley, Esq., and Kimberly D. Newmarch, Esq., at
DLA Piper LLP (US), serve as the Debtors' bankruptcy counsel.
Kurtzman Carson Consultants, LLC, is the Debtors' claims and
notice agent.
The Debtors estimated total assets of at least $275 million
(estimated value of portfolio securing loan to BankofAmerica) and
total debts of at least $479 million ($475 million owed to BofA,
$4.4 million trade debt).
PJ FINANCE: Section 341(a) Meeting Scheduled for April 6
--------------------------------------------------------
The U.S. Trustee for Region 3 will convene a meeting of PJ Finance
Company, LLC, et al.'s creditors on April 6, 2011, at 1:00 p.m.
The meeting will be held at J. Caleb Boggs Federal Building, Room
5209, 844 King Street Wilmington, Delaware, 19801.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Chicago, Illinois-based PJ Finance Company, LLC, owns apartment
communities in the states of Arizona, Florida, Georgia, Tennessee
and Texas. PJ Finance owns or holds ownership interests in 32
apartment communities that collectively have more than 9,500
rentable units. It has 20 apartment locations in Texas, and the
remaining 12 in Arizona, Florida, Georgia and Tennessee. The day-
to-day operations of the portfolio are managed by a third party,
WestCorp Management Group One, Inc.
PJ Finance filed for Chapter 11 bankruptcy protection on March 7,
2011 (Bankr. D. Del. Case No. 11-10688).
Affiliates PJ Holding Company Manager, LLC (Bankr. D. Del. Case
No. 11-10692); PJ Holding Company, LLC (Bankr. D. Del. Case No.
11-10693); Alliance PJRT GP, Inc. (Bankr. D. Del. Case No. 11-
10695); Alliance PJWE GP, L.L.C. (Bankr. D. Del. Case No. 11-
10697); Alliance PJRT Limited Partnership (Bankr. D. Del. Case No.
11-10699); and Alliance PJWE Limited Partnership (Bankr. D. Del.
Case No. 11-10700) filed separate Chapter 11 petitions.
The cases are jointly administered, with PJ Finance Company as the
lead case.
Michelle E. Marino, Esq., and Stuart M. Brown, Esq., and Edwards
Angell Palmer & Dodge, LLP, serve as the Debtors' local bankruptcy
counsel.
Richard A. Chesley, Esq., and Kimberly D. Newmarch, Esq., at
DLA Piper LLP (US), serve as the Debtors' bankruptcy counsel.
Kurtzman Carson Consultants, LLC, is the Debtors' claims and
notice agent.
The Debtors estimated total assets of at least $275 million
(estimated value of portfolio securing loan to BankofAmerica) and
total debts of at least $479 million ($475 million owed to BofA,
$4.4 million trade debt).
PJ FINANCE: Wants to Enter Into Financing Arrangement With Gaia
---------------------------------------------------------------
PJ Finance Company, LLC, et al., ask for authorization from the
U.S. Bankruptcy Court for the District of Delaware to enter into a
commitment letter dated March 2, 2011, with Gaia Real Estate
Investments LLC.
As set forth in the Commitment Letter, Gaia will provide the
Debtors with $42 million in new financing that will enable the
Debtors to consummate a plan of reorganization. Gaia, along with
an affiliate of PJ Finance that will also fund $1 million, will
get 100% of the equity interests of the entity that will be formed
to consummate the Chapter 11 reorganization.
Up to $20.0 million of the new money investment may be structured
as an unsecured mezzanine loan at 14% interest for a term that
ends upon the later of (i) 10 years or (ii) the maturity date of
PJ Finance's senior credit facility. Newco will have the option
to defer payments until maturity.
In connection with the new money investment, Gaia will arrange a
replacement non-recourse carveout guaranty with respect to any
financing relating to the Debtor's property.
The $42.0 million will be spent by Newco as directed by the board
of directors to fund closing costs, operations of the property and
other necessary expenses, and the payment of administrative,
priority and unsecured claims in an amount to be agreed upon.
Conditions precedent to the new money investment include:
(i) court authorization of the Debtors' new money investment
request by March 21, 2011; and (ii) filing of plan of
reorganization and accompanying disclosure statement with the
Court by May 16, 2011, and confirmation of that Plan by July 15,
2011.
Subsequent to the Plan's confirmation, PJ Finance's affiliate will
have the option to purchase 20.0% of the equity of Newco from Gaia
for $4.4 million. In the event that the affiliate exercises the
option, Gaia will provide financing to the affiliate for the
entire purchase price at 8% annual interest rate. The note will
be non-recourse and secured by the affiliate's 20.0% interest in
Newco.
In consideration of Gaia's prior and future efforts expended in
pursuing the transactions in the Commitment Letter, in the event
that the Court approves of a new money investment by a third party
instead of Gaia, the Debtors agree to seek the Court's permission
to pay Gaia a break-up fee of $1 million.
A copy of the Commitment Letter is available for free at:
http://bankrupt.com/misc/PJ_FINANCE_commitmentletter.pdf
About PJ Finance
Chicago, Illinois-based PJ Finance Company, LLC, owns apartment
communities in the states of Arizona, Florida, Georgia, Tennessee
and Texas. PJ Finance owns or holds ownership interests in 32
apartment communities that collectively have more than 9,500
rentable units. It has 20 apartment locations in Texas, and the
remaining 12 in Arizona, Florida, Georgia and Tennessee. The day-
to-day operations of the portfolio are managed by a third party,
WestCorp Management Group One, Inc.
PJ Finance filed for Chapter 11 bankruptcy protection on March 7,
2011 (Bankr. D. Del. Case No. 11-10688).
Affiliates PJ Holding Company Manager, LLC (Bankr. D. Del. Case
No. 11-10692); PJ Holding Company, LLC (Bankr. D. Del. Case No.
11-10693); Alliance PJRT GP, Inc. (Bankr. D. Del. Case No. 11-
10695); Alliance PJWE GP, L.L.C. (Bankr. D. Del. Case No. 11-
10697); Alliance PJRT Limited Partnership (Bankr. D. Del. Case No.
11-10699); and Alliance PJWE Limited Partnership (Bankr. D. Del.
Case No. 11-10700) filed separate Chapter 11 petitions.
The cases are jointly administered, with PJ Finance Company as the
lead case.
Michelle E. Marino, Esq., and Stuart M. Brown, Esq., and Edwards
Angell Palmer & Dodge, LLP, serve as the Debtors' local bankruptcy
counsel.
Richard A. Chesley, Esq., and Kimberly D. Newmarch, Esq., at
DLA Piper LLP (US), serve as the Debtors' bankruptcy counsel.
Kurtzman Carson Consultants, LLC, is the Debtors' claims and
notice agent.
The Debtors estimated total assets of at least $275 million
(estimated value of portfolio securing loan to BankofAmerica) and
total debts of at least $479 million ($475 million owed to BofA,
$4.4 million trade debt).
PLATINUM ENERGY: Bradley Radoff Discloses 5.0% Equity Stake
-----------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Bradley Louis Radoff disclosed that he beneficially
owns 1,134,300 shares of common stock of Platinum Energy
Resources, Inc. representing 5.0% of the shares outstanding.
As of Nov. 8, 2010, 22,606,476 of the registrant's common stock,
par value $0.0001 per share, were outstanding.
About Platinum Energy
Houston, Tex.-based Platinum Energy Resources, Inc. --
http://www.platenergy.com/-- is an independent oil and gas
exploration and production company. The Company has approximately
37,000 acres under lease in relatively long-lived fields with
well-established production histories. The properties properties
are concentrated primarily in the Gulf Coast region in Texas, the
Permian Basin in Texas and New Mexico, and the Fort Worth Basin in
Texas.
GBH CPAs, PC, in Houston, Texas, 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
Dec. 31, 2009. The independent auditors noted that the
Company has experienced significant losses since inception and is
currently in default of its debt agreements.
The Company has incurred significant losses, resulting in
cumulative losses of $113,747,702 through September 30, 2010. At
September 30, 2010, the Senior Credit Facility balance was
approximately $5.15 million. The Company's current cash on hand
of $2,395,820 is not adequate to satisfy the debt. Also, the
Company has negative working capital of $8,168,992. Currently the
Company is looking at various ways of correcting these issues,
including exploring joint venture opportunities as well as a
thorough analysis of our specific assets for potential
divestiture. Further the Company has assets and liabilities that
could be affected by unfavorable outcomes of litigation in
progress.
POWERPLUS ELECTRIC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: PowerPlus Electric, LLC
12200 Chandler Drive
Walton, KY 41094
Bankruptcy Case No.: 11-20597
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
Eastern District of Kentucky (Covington)
Debtor's Counsel: Paige Leigh Ellerman, Esq.
TAFT STETTINIUS & HOLLISTER LLP
425 Walnut St., Suite 1800
Cincinnati, OH 45202
Tel: (513) 381-2838
E-mail: ellerman@taftlaw.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/kyeb11-20597.pdf
The petition was signed by Dino Lucarelli, chief financial
officer.
QA3 LLC: Case Summary & 22 Largest Unsecured Creditors
------------------------------------------------------
Debtor: QA3, LLC
14748 West Center Rd, Suite 300
Omaha, NE 68144
Bankruptcy Case No.: 11-80596
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
District of Nebraska (Omaha Office)
Judge: Thomas L. Saladino
Debtor's Counsel: Jenna B. Taylor, Esq.
JENNA TAYLOR LAW
P.O. Box 45101
Omaha, NE 68145
Tel: (402) 210-2335
E-mail: jenna@jennalaw.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 22 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/neb11-80596.pdf
The petition was signed by Stephen K. Wild, managing member.
Debtor-affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
QA3 Financial Corp. 11-80297 02/11/11
QUALITY DISTRIBUTION: Incurs $10.68MM Net Loss in Dec. 31 Qtr.
--------------------------------------------------------------
Quality Distribution, Inc. reported a net loss of $10.68 million
on $165.76 million of total operating revenue for the three months
ended Dec. 31, 2010, compared with net income of $4.56 million on
$151.28 million of total operating revenue for the same period
during the prior year.
The Company also reported a net loss of $7.40 million on $686.60
million of total operating revenue for the year ended Dec. 31,
2010, compared with a net loss of $180.53 million on $613.61
million of total operating revenue during the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $271.34
million in total assets, $415.88 million in total liabilities,
$1.83 million in redeemable noncontrolling interest and $146.37
million in total shareholders' deficit.
Gary Enzor, Chief Executive Officer, commented, "I am very pleased
with our fourth quarter and full year results, which reflect
continued year over year increases in revenue and earnings.
Demand for our services continues to show improvement, and we are
realizing the earnings power of our asset-light business model."
A full-text copy of the press release announcing the financial
results is available for free at:
http://ResearchArchives.com/t/s?74f6
About Quality Distribution
Quality Distribution, LLC, and its parent holding company, Quality
Distribution, Inc., are headquartered in Tampa, Florida. The
company is a transporter of bulk liquid and dry bulk chemicals.
The company's 2010 revenues are approximately $686 million.
Apollo Management, L.P., owns roughly 30% of the common stock of
Quality Distribution, Inc.
As reported by the Troubled Company Reporter on Feb. 18, 2011,
Moody's Investors Service said the $38 million public offering of
4 million shares of Quality Distribution's common stock on Feb. 9,
2011, does not affect Quality's 'Caa1' corporate family and
probability of default ratings with a positive outlook. However,
Moody's notes that the intended debt reduction at par from $17.5
million of the proceeds would be viewed favorably.
QUEPASA CORP: B. Garrett Has Option to Buy 379,221 Common Shares
----------------------------------------------------------------
In a Form 3 filing with the U.S. Securities and Exchange
Commission, Brian Garrett, vice president of Strategy, disclosed
that he has option to buy an aggregate of 379,221 shares of common
stock of Quepasa Corp.
About Quepasa Corporation
West Palm Beach, Fla.-based Quepasa Corporation (OTC BB: QPSA)
through its Web site -- http://www.Quepasa.com/-- operates as an
online social community for young Hispanics.
The Company's balance sheet at Dec. 31, 2010 showed $16.45 million
in total assets, $7.26 million in total liabilities and
$9.19 million in total stockholders' equity.
As reported in the Troubled Company Reporter on March 9, 2010,
Salberg & Company, P.A. expressed substantial doubt about the
Company's ability to continue as a going concern following the
2009 results. The independent auditors noted of the Company's
net loss and net cash used in operating activities in 2009 of
$10.58 million and $3.88 million, respectively, and a
stockholders' deficit and an accumulated deficit of $3.90 million
and $159.33 million, respectively, at Dec. 31, 2009.
QUINTILES TRANSNATIONAL: Moody's Affirms 'B1' Corp. Family Rating
-----------------------------------------------------------------
Moody's Investors Service affirmed the B1 Corporate Family Rating
and B1 Probability of Default Rating of Quintiles Transnational
Corp. and assigned a B1 rating to the proposed $2.425 billion
senior secured credit facility. The new credit facility will
include a $2.2 billion Term Loan B and a $225 million revolving
credit facility. The proceeds of the term loan will be used to
refinance substantially all of Quintiles' existing debt, including
indebtedness under the existing credit agreement and $525 million
of senior unsecured notes issued at Quintiles Transnational
Holdings. Approximately $500 million of the new Term Loan
proceeds will be retained as cash on the balance sheet, although
Moody's believes it is highly likely the proceeds will ultimately
be used for a shareholder payout, either a dividend or share
repurchase. The rating outlook is stable.
Summary of Moody's actions:
Quintiles Transnational Corp.
* Affirmed B1 Corporate Family Rating
* Affirmed B1 Probability of Default Rating
* Assigned B1 (LGD 3, 46%) to proposed $225 million senior secured
revolving credit facility, due 2016
* Assigned B1 (LGD 3, 46%) to proposed $2.2 billion senior secured
Term Loan B, due 2018
The outlook is stable.
These ratings will be withdrawn upon repayment:
Quintiles Transnational Corp.
* $225 million senior secured revolving credit facility due 2012,
Ba2 (LGD2, 27%)
* $950 million first lien senior secured term loan due 2013 Ba2
(LGD2, 27%)
* $220 million second lien term loan due 2014, B2 (LGD 4, 66%)
Quintiles Transnational Holdings Inc.
* B3 (LGD5, 89%) senior unsecured notes of $525 million due 2014
Quintiles' B1 Corporate Family Rating is constrained by the
company's somewhat high financial leverage and modest free cash
flow relative to debt (FCF/debt), which are in-line with other B1
rated peers. The ratings also reflects the company's history of
aggressive financial policies, including numerous dividends to
shareholders and share repurchase transactions. The ratings are
supported by the company's size, scale and leading position as
both a pharmaceutical contract research organization and a
contract sales organization. Further, the company has
demonstrated stable operating performance and cash flow, even
during the economic downturn. The ratings are also supported by
the company's liquidity profile, which is expected to continue to
be very good over the next year. Longer-term Moody's views the
prospects for the CRO and CSO industries as favorable as
pharmaceutical companies look to outsource an increasing portion
of their non-core functions. However, Moody's believes that the
impending patent cliff in the pharmaceutical industry presents
some near to medium term event risk for the CRO and CSO
industries.
Moody's could upgrade the ratings of Quintiles if the company
demonstrates continued stable revenue growth and margins and
sustains "Ba" credit ratios per the Business & Consumer Services
Rating Methodology. The "Ba" ranges include (CFO-dividends)/net
debt of 15%-25%, FCF/debt of 8-16% (after dividends); and
debt/EBITDA of 3.0x-4.0x. Moody's could downgrade the ratings if
the company experienced revenue declines and/or margin erosion due
to broader trends within the CRO or CSO industry or if the company
undertook a significant debt-financed acquisition or shareholder
initiatives beyond Moody's expectations. For example, sustained
CFO/debt below 5%, adjusted debt to EBITDA above 5.5 times; or
negative free cash flow could lead to rating pressure.
Headquartered in Research Triangle Park, North Carolina, Quintiles
is a leading global provider of outsourced contract research and
contract sales services to pharmaceutical, biotechnology and
medical device companies. The company is privately-held with
ownership stakes by founder, Chairman and CEO, Dr. Dennis
Gillings, and private equity firms Bain, TPG, 3i and Temasek.
Quintiles recorded net revenue of approximately $3.0 billion for
the twelve month period ended December 31, 2010.
R&G FINANCIAL: Puerto Rico Court Stays Rodriguez Suit
-----------------------------------------------------
District Judge Jose Antonio Fuste stayed the lawsuit, JOCELYN
RODRIGUEZ, Plaintiff v. FEDERAL DEPOSIT INSURANCE CORPORATION, as
Receiver for R-G PREMIER BANK OF PUERTO RICO, et al., Defendants,
Civil No. 10-1656 (D. P.R.), at the receiver's behest, pending the
completion of the mandatory administrative claims process.
Plaintiff has not opposed the motion. FDIC-R is to notify the
Court of the status of the administrative claims process on or
before August 4, 2011.
FDIC-R removed the lawsuit on July 14, 2010, from the Court of
First Instance, San Juan Superior Part, Commonwealth of Puerto
Rico.
The Court denied a separate motion by FDIC-R for an order
designating a magistrate judge.
The Court, meanwhile, granted defendant R&G Financial
Corporation's motion to stay the proceedings against it due to its
bankruptcy. R&G Financial filed for Chapter 11 on May 14, 2010.
A copy of the Court's March 8, 2011 opinion and order is available
at http://is.gd/ohcpssfrom Leagle.com.
San Juan, Puerto Rico-based R&G Financial Corporation filed for
Chapter 11 bankruptcy protection on May 14, 2010 (Bankr. D. P.R.
Case No. 10-04124). Jorge I. Peirats, Esq., at Pietrantoni,
Mendez & Alvarez, assists the Company in its restructuring effort.
The Company disclosed US$40,213,356 in assets and US$420,687,694
in debts.
REVIVAL OUTREACH: Case Summary & Largest Unsecured Creditor
-----------------------------------------------------------
Debtor: Revival Outreach Center International Church
415 S. West Street
Royal Oak, MI 48067
Bankruptcy Case No.: 11-46419
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Thomas J. Tucker
Debtor's Counsel: Erica J. Ehrlichman, Esq.
THE FINDLING LAW FIRM, PLC
415 S. West Street
Royal Oak, MI 48067
Tel: (248) 399-9700
E-mail: erica@findlinglaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The list of 20 largest unsecured creditors contains only one
entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Comerica Bank $5,900,000
c/o Alfredo Casab
39533 Woodward Ave.
Suite 200
Bloomfield Hills, MI 48304
The petition was signed by David Findling, special restructuring
officer.
REYNOLDS & REYNOLDS: S&P Puts 'BB+' Issue-Level Rating
------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its
corporate credit rating on Dayton, Ohio-based automobile dealer
software and services provider Reynolds & Reynolds Co. The
outlook is positive.
S&P also assigned a 'BB+' issue-level rating and a '1' recovery
rating to the company's new $1.55 senior secured credit
facilities, consisting of a $600 million term loan A maturing 2016
and a $950 million term loan B maturing 2018. The '1' recovery
rating indicates S&P's expectations for very high (90%-100%)
recovery in the event of payment default. The company intends to
use the proceeds of the term loan to refinance its existing debt
and for fees and expenses. The borrower of the term loans is
Dealer Computer Services Inc., which owns 100% of The Reynolds &
Reynolds Co.
"The raising of the corporate credit rating reflects an
improvement to the company's financial risk profile," said
Standard & Poor's credit analyst Jennifer Pepper. Reynolds has
exhibited a moderate financial policy over the past two years; the
company has used cash to delever, has not made dividends upstream
to its parent, and has made only modest acquisitions.
RIO RANCHO: Files Schedules of Assets & Liabilities
---------------------------------------------------
Rio Rancho Super Mall, LLC, has filed with the U.S. Bankruptcy
Court for the Central District of California its schedules of
assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $7,500,000
B. Personal Property $191,584
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $11,942,067
E. Creditors Holding
Unsecured Priority
Claims $81,799
F. Creditors Holding
Unsecured Non-priority
Claims $230,000
----------- -----------
TOTAL $7,691,584 $12,253,866
Moreno Valley, California-based Rio Rancho Supermall, LLC, owns,
manages and operates a commercial property known as the Rio Rancho
Super Mall that is utilized as an indoor swap-meet and retail
mall. It filed for Chapter 11 bankruptcy protection on March 2,
2011 (Bankr. C.D. Calif. Case No. 11-16835). Thomas E. Kent,
Esq., who has an office in Los Angeles, California, serves as the
Debtor's bankruptcy counsel.
RIO RANCHO: Has Court's Interim Nod to Use Cash Collateral
----------------------------------------------------------
Rio Rancho Super Mall, LLC, sought and obtained interim
authorization from the U.S. Bankruptcy Court for the Central
District of California to use the cash collateral until March 29,
2011.
The Debtor owes (i) Wilshire State Bank to that certain secured
promissory note, dated April 6, 2006, in the original principal
amount of $10,422,000; (ii) Pacific City Bank pursuant to that
certain secured promissory note dated Jan. 12, 2007, in the
approximate sum of $800,000; (iii) Saehan Bank pursuant to that
certain secured promissory note dated Dec. 26, 2007, in the
original principal amount of $200,000; and (iv) BFG Company
pursuant to that certain secured promissory note, dated Oct. 16,
2008, in the original principal amount of $100,000. The loans are
secured by Rio Rancho Super Mall.
Thomas E. Kent, Esq., at the Law Offices of Lee & Kent, 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/RIO_RANCHO_budget.pdf
In exchange for using the cash collateral, the Debtor proposes:
(i) that Rio Rancho Super Mall will remain fully and properly
insured; (ii) to make monthly interest only payments to its senior
secured lender, WSB, in the amount of $35,000; (iii) to provide
monthly payments to junior lien holders, in order of priority, of
any available funds after the monthly business expenses have been
paid for; (iv) that the Debtor's financial books and records will
be made available for inspection and audit by the Secured Lenders
upon reasonable request; and (v) the Debtor will continue to
provide for the management and maintenance of the Rio Rancho Super
Mall to ensure that there will be no diminution of its market
value.
A final hearing on the Debtor's request for cash collateral use is
scheduled to occur on March 29, 2011, at 2:00 p.m.
Moreno Valley, California-based Rio Rancho Supermall, LLC, owns,
manages and operates a commercial property known as the Rio Rancho
Super Mall that is utilized as an indoor swap-meet and retail
mall. It filed for Chapter 11 bankruptcy protection on March 2,
2011 (Bankr. C.D. Calif. Case No. 11-16835). Thomas E. Kent,
Esq., who has an office in Los Angeles, California, serves as the
Debtor's bankruptcy counsel. In its schedules, the Debtor
disclosed $7,691,584 in total assets and $12,253,866 in total
debts as of the Petition Date.
RIO RANCHO: Section 341(a) Meeting Scheduled for April 5
--------------------------------------------------------
The U.S. Trustee for Region 15 will convene a meeting of Rio
Rancho Supermall, LLC's creditors on April 5, 2011, at 2:30 p.m.
The meeting will be held at Room 200C, 3685 Main Street, 2nd
Floor, Riverside, California 92501.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Moreno Valley, California-based Rio Rancho Supermall, LLC, owns,
manages and operates a commercial property known as the Rio Rancho
Super Mall that is utilized as an indoor swap-meet and retail
mall. It filed for Chapter 11 bankruptcy protection on March 2,
2011 (Bankr. C.D. Calif. Case No. 11-16835). Thomas E. Kent,
Esq., who has an office in Los Angeles, California, serves as the
Debtor's bankruptcy counsel. In its schedules, the Debtor
disclosed $7,691,584 in total assets and $12,253,866 in total
debts as of the Petition Date.
RIO RANCHO: Taps Law Offices of Lee & Kent as Bankruptcy Counsel
----------------------------------------------------------------
Rio Rancho Super Mall, LLC, asks for authorization from the U.S.
Bankruptcy Court for the Central District of California to employ
the Law Offices of Lee & Kent as bankruptcy counsel.
Lee & Kent will, among other things:
a. represent the Debtor in any proceeding or hearing in the
Court involving its estate unless the Debtor is
represented in the proceeding or hearing by other special
counsel;
b. examine witnesses, claimants or adverse parties and
represent the Debtor in any adversary proceeding, except
to the extent that any adversary proceeding is in an area
outside of Lee & Kent's expertise or which is beyond Lee &
Kent's staffing capabilities;
c. prepare and assist the Debtor in the preparation of
reports, in the preparation of reports, applications,
pleadings and orders; and
d. assist the Debtor in the negotiation, formulation,
preparation and confirmation of a plan of reorganization
and the preparation and approval of a disclosure statement
in respect to the plan.
Lee & Kent will be paid based on the hourly rates of its
professionals:
Thomas E. Kent $450
Justin M. Lee $400
William K. Hong $200
Kate Shin, Paralegal $80
To the best of the Debtor's knowledge, Lee & Kent is a
"disinterested person" within the meaning of Section 101(14) of
the Bankruptcy Code.
Moreno Valley, California-based Rio Rancho Supermall, LLC, owns,
manages and operates a commercial property known as the Rio Rancho
Super Mall that is utilized as an indoor swap-meet and retail
mall. It filed for Chapter 11 bankruptcy protection on March 2,
2011 (Bankr. C.D. Calif. Case No. 11-16835). Thomas E. Kent,
Esq., who has an office in Los Angeles, California, serves as the
Debtor's bankruptcy counsel. In its schedules, the Debtor
disclosed $7,691,584 in total assets and $12,253,866 in total
debts as of the Petition Date.
RITE AID: Bank Debt Trades at 4% Off in Secondary Market
----------------------------------------------------------
Participations in a syndicated loan under which Rite Aid Corp. is
a borrower traded in the secondary market at 95.93 cents-on-the-
dollar during the week ended Friday, March 11, 2011, a drop of
0.65 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 175 basis points above LIBOR to borrow
under the facility. The bank loan matures on May 25, 2014, and
carries Moody's 'B3' rating and Standard & Poor's 'B+' rating.
The loan is one of the biggest gainers and losers among 180 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
As reported by the Troubled Company Reporter on Feb. 22, 2011,
Moody's assigned a B3 rating to Rite Aid Corp.'s proposed $343
million Tranche 5 senior secured first lien term loan due 2018.
All other ratings including its Caa2 Corporate Family Rating, Caa2
Probability of Default Rating, and SGL-3 Speculative Grade
Liquidity rating were affirmed. The rating outlook is stable.
The proceeds will be used to repay the $343 million (including
$21.2 original issue discount) Tranche 3 term loan due 2014.
Following the repayment, the Tranche 3 term loan will be retired
and its B3 rating withdrawn.
About Rite Aid Corp.
Drugstore chain Rite Aid Corporation (NYSE: RAD) --
http://www.riteaid.com/-- based in Camp Hill, Pennsylvania, has
more than 4,700 stores in 31 states and the District of Columbia
and fiscal 2010 annual revenues of $25.7 billion.
Rite Aid carries 'Caa2' probability of default and corporate
family ratings from Moody's Investors Service. It has a 'B-'
corporate credit rating from Standard & Poor's Ratings Services.
The Company's balance sheet at November 27, 2010, showed $7.8
billion in total assets, $9.8 billion in total liabilities, and a
stockholders' deficit of $2.0 billion.
The TCR reported on Feb. 21, 2011 that Standard & Poor's Ratings
Services said that it assigned its 'B+' issue rating and '1'
recovery rating to Rite Aid Corp.'s proposed $343 million senior
secured term loan tranche 5 due 2018. The '1' recovery rating
indicates S&P's expectation for very high (90%-100%) recovery in
the event of a payment default. According to the company, it will
use the proceeds to repay about $321 million in borrowings under
its tranche 3 term loan due 2014.
"The ratings reflect the difficulties Rite Aid faces in improving
its well-below-average operating performance relative to its
peers, especially amid intense industry competition," said
Standard & Poor's credit analyst Ana Lai. They also reflect the
company's significant debt burden and thin cash flow protection
measures.
ROYAL PROFESSIONAL: Case Summary & 8 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Royal Professional Builders, Inc.
7240 7 Pl N
West Palm Beach, FL 33411
Bankruptcy Case No.: 11-16491
Chapter 11 Petition Date: March 11, 2011
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Erik P. Kimball
Debtor's Counsel: Robert C. Furr, Esq.
Alvin S. Goldstein, Esq.
FURR & COHEN
2255 Glades Rd #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
E-mail: bnasralla@furrcohen.com
mmitchell@furrcohen.com
Scheduled Assets: $3,565,687
Scheduled Debts: $6,666,124
A list of the Company's eight largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/flsb11-16491.pdf
The petition was signed by Wallace D. Sanger, president.
SBARRO INC: Moody's Cuts Probability of Default Rating to 'Ca/LD'
-----------------------------------------------------------------
Moody's Investors Service revised Sbarro, Inc.'s Probability of
Default Rating to Ca/LD, reflecting the limited default that has
occurred with respect to the company's 10.375% Senior Notes due
2015. The company's other ratings were affirmed, including the
Corporate Family Rating at Ca. The rating outlook is negative.
Moody's took these ratings actions on Sbarro:
-- Corporate Family Rating affirmed at Ca:
-- Probability of Default Rating revised to Ca/LD from Ca;
-- Senior secured first lien revolver affirmed at Caa1 (LGD2,
16%) from Caa1 (LGD2, 17%);
-- Senior secured first lien term loan affirmed at Caa1 (LGD2,
16%) from Caa1 (LGD2, 17%);
-- Senior Unsecured notes affirmed at C (LGD5, 76%);
-- Speculative Grade Liquidity Rating affirmed at SGL-4
The ratings outlook is negative.
Ratings Rationale
The Ca/LD rating reflects Sbarro's announcement that it did not
make the February 1, 2011 scheduled interest payment under its
unsecured notes within the allowable grace period, which expired
on March 3, 2011. The company also announced that it has entered
into a Third Forbearance Agreement with lenders under its first
lien credit agreement.
The ratings and negative outlook reflect the uncertainty with
regards to Sbarro's ability to remain a going concern, as well as
Moody's view that the company's capital structure is unsustainable
at current levels of operating performance. As a result, Moody's
believes that any restructuring of its debt could result in some
impairment to secured lenders and significant impairment to the
unsecured notes.
The last rating action on Sbarro occurred on July 17, 2009, when
Moody's affirmed the Ca Corporate Family Rating.
Sbarro, Inc., headquartered in Melville, NY, is a quick service
restaurant operator that serves Italian specialty foods, with
approximately 476 company-owned restaurants and 538 franchised.
Annual revenues are approximately $333 million.
SCENIC VIEW: Case Summary & 16 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Scenic View Properties, LLC
4957 County Road 91 SW
Alexandria, MN 56308
Bankruptcy Case No.: 11-60236
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
District of Minnesota (Fergus Falls)
Judge: Dennis D O'Brien
Debtor's Counsel: Jon R. Brakke, Esq.
VOGEL LAW FIRM
P.O. Box 1389
218 NP Ave
Fargo, ND 58107-1389
Tel: (701) 237-6983
E-mail: jbrakke@vogellaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 16 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/mnb11-60236.pdf
The petition was signed by Dennis N. Westrom, president.
SEAGATE TECHNOLOGY: WD AND Hitachi Deal Won't Move Moody's Rating
-----------------------------------------------------------------
Moody's Investors Service said Seagate Technology HDD Holdings Ba1
Corporate Family Rating is not immediately impacted by Western
Digital's (unrated) announcement earlier this week that WD has
entered into a definitive agreement to acquire Hitachi GST (a
business unit of Hitachi Ltd., rated A3), the third largest hard
disk drive manufacturer, for approximately $4.3 billion.
The last rating action was on December 8, 2010 when Moody's
assigned a Ba1 rating to Seagate HDD Cayman's (wholly-owned
subsidiary of Seagate) $750 million senior unsecured notes due
2018.
Seagate Technology HDD Holdings, with headquarters in Scotts
Valley, CA, is a leading manufacturer of disk drive products used
as the primary medium for storing electronic information in
systems ranging from PCs and consumer electronics to data centers.
SIDERA NETWORKS: S&P Assigns 'B' Rating to $310 Mil. Loan
---------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
issue-level rating to Sidera Networks Inc.'s (B/Stable/--)
proposed amended and restated $310 million first-lien term loan
and $50 million revolver. The recovery rating on these issues is
'4', indicating S&P's expectation of average (30%-50%) recovery
for lenders in the event of a payment default.
This proposed transaction amends and restates the existing term
loan and revolver, which was most recently amended for incremental
proceeds in December 2010. In the current proposed transaction,
the amounts do not change but Sidera will repay a small
outstanding revolver balance, and the new revolver will be undrawn
at close.
S&P's 'B' corporate credit rating on Herndon, Va.-based metro
fiber provider Sidera and stable outlook are not affected by the
proposed transaction. Pro forma for the full-year impact of the
CCS and LIFE acquisitions that closed in the fourth quarter of
2010, adjusted leverage remains about 5.7x total debt to EBITDA,
as of Dec. 31, 2010. S&P continues to view Sidera's liquidity as
less than adequate under S&P's criteria due to insufficient
headroom with respect to its current total leverage covenant.
However, if the proposed amendment includes looser covenants that
provide for over 15% EBITDA cushion, S&P would reassess liquidity
as adequate.
Ratings List
Sidera Networks Inc.
Corporate Credit Rating B/Stable/--
New Ratings
Sidera Networks Inc.
$310 mil first-lien term loan B
Recovery Rating 4
$50 mil revolver B
Recovery Rating 4
SEAHAWK DRILLING: Receives Final Approval for $35 Million Loan
--------------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
Seahawk Drilling Inc. received final approval for a $35 million
secured loan from DE Shaw & Co. at the final financing hearing
March 11. The official equity-holders' committee objected,
contending there were lenders who would offer better terms.
According to the report, after interim approval of the loan, the
initial draw paid off the existing $18.15 million secured loan
from Natixis. Seahawk, the owner of 20 shallow-water jackup rigs,
entered bankruptcy with a contract for selling the business to
competitor Hercules Offshore Inc. under in a transaction valued at
$105 million. The price includes $25 million cash and
22.3 million Hercules shares. Seahawk said the sale should pay
funded debt and trade suppliers in full. Seahawk rose 2 cents to
close at $6.50 on March 11 in over-the-counter trading.
About Seahawk Drilling
Houston, Texas-based Seahawk Drilling, Inc., engages in a jackup
rig business in the United States, Gulf of Mexico, and offshore
Mexico. It offers rigs and drilling crews on a day rate
contractual basis. It filed for Chapter 11 bankruptcy protection
on February 11, 2011 (Bankr. S.D. Tex. Case No. 11-20089).
Affiliates Seahawk Drilling LLC (Bankr. S.D. Tex. Case No.
11-20088), Seahawk Drilling, Inc. (Bankr. S.D. Tex. Case No.
11-20089), Seahawk Mexico Holdings LLC (Bankr. S.D. Tex. Case No.
11-20090), Seahawk Drilling Management LLC (Bankr. S.D. Tex. Case
No. 11-20091), Seahawk Offshore Management LLC (Bankr. S.D. Tex.
Case No. 11-20092), Energy Supply International LLC (Bankr. S.D.
Tex. Case No. 11-20093), Seahawk Global Holdings LLC (Bankr. S.D.
Tex. Case No. 11-20094), and Seahawk Drilling USA LLC (Bankr. S.D.
Tex. Case No. 11-20095) filed separate Chapter 11 petitions.
Berry D. Spears, Esq., and Johnathan Christiaan Bolton, Esq., at
Fullbright & Jaworkski L.L.P., serve as the Debtors' bankruptcy
counsel. Jordan, Hyden, Womble, Culbreth & Holzer, P.C., serves
as the Debtors' co-counsel. Alvarez and Marsal North America,
LLC, is the Debtors' restructuring advisor. Simmons And Company
International is the Debtors' transaction advisor. Kurtzman
Carson Consultants LLC is the Debtors' claims agent. Judy A.
Robbins, U.S. Trustee for Region 7, appointed three creditors to
serve on an Official Committee of Unsecured Creditors of Seahawk
Drilling Inc. and its debtor-affiliates. Heller, Draper, Hayden,
Patrick & Horn, L.L.C., represents the creditors committee.
The Debtors disclosed $504,897,000 in total assets and
$124,474,000 in total debts as of the Petition Date.
SEQUENOM INC: Files Form 10-K; Posts $120.8-Mil. Loss in 2010
-------------------------------------------------------------
Sequenom, Inc. filed its annual report on Form 10-K with the U.S.
Securities and Exchange Commission reporting a net loss of
$120.85 million on $47.45 million of total revenue for the year
ended Dec. 31, 2010, compared with a net loss of $71.01 million on
$37.86 million of total revenue during the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $
174.27 million in total assets, $23.54 million in total
liabilities and $150.73 million in total stockholders' equity.
Ernst & Young LLP of San Diego, California, in its audit report
attached to the 2010 financial statements, did not include a going
concern qualification for Sequenom. E&Y, in its report on the
2009 results, expressed substantial doubt against Sequenom's
ability as a going concern, noting that the Company
"has incurred recurring operating losses and does not have
sufficient working capital to fund operations through 2010."
A full-text copy of the annual report on Form 10-K is available
for free at http://ResearchArchives.com/t/s?74f7
About Sequenom
Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a
life sciences company committed to improving healthcare through
revolutionary genetic analysis solutions. Sequenom develops
innovative technology, products and diagnostic tests that target
and serve discovery and clinical research, and molecular
diagnostics markets. The company was founded in 1994 and is
headquartered in San Diego, California.
SOLOMON DWEK: Dist. Court Affirms Ruling Against Uncle's Suit
-------------------------------------------------------------
Spouses Joseph Dwek and Terry Dwek filed a complaint against Sun
National Bank and their nephew, Solomon Dwek, in September 2006 in
the Superior Court of New Jersey, Chancery Division, challenging
the validity of a 2001 loan transaction involving a promissory
note in the original principal amount of $1,500,000 secured by a
mortgage on their property at 234 Runyan Avenue, Deal, New Jersey,
in favor of Sun. Sun removed the action to the United States
District Court for the District of New Jersey, and the District
Court referred the action to the United States Bankruptcy Court
for the District of New Jersey. Sun then commenced a separate
adversary proceeding against Solomon Dwek seeking a determination
that to the extent Solomon Dwek, the Debtor in a Chapter 7
bankruptcy proceeding that was later converted to Chapter 11,
might be found liable for any damages to Sun in the removed
action, that obligation would be deemed non-dischargeable in
Solomon Dwek's bankruptcy proceeding. The Bankruptcy Court
consolidated the two adversary proceedings, pursuant to Federal
Rule of Bankruptcy Procedure 7042.
The Bankruptcy Court issued a written opinion discussing its
findings and conclusions on June 1, 2010. In an Order of Final
Judgment, the Bankruptcy Court entered judgment in favor of Sun
and against the Dweks as to Sun's counterclaims for breach of
contract, and a judgment declaring the Dweks liable to Sun in the
amount of $1,845,850.85 on the Loan, Note, and Mortgage. The
Bankruptcy Court dismissed as moot Sun's remaining counterclaims,
along with Sun's crossclaim, third-party complaint, and claim
against Solomon Dwek seeking a claim of non-dischargeability in
the bankruptcy proceeding. The Bankruptcy Court dismissed the
Dweks' complaint with prejudice in its entirety. The Dweks appeal
from the 6-10-10 Order of Final Judgment, pursuant to 28 U.S.C.
Sec. 158(a).
According to District Judge Mary L. Cooper, the Dweks have failed
to demonstrate that the Bankruptcy Court erred in entering the
6-10-10 Order of Final Judgment. Hence, the District Court
affirmed the 6-10-10 Order of Final Judgment.
The suit is JOSEPH DWEK, et al., Appellants, v. SUN NATIONAL BANK,
et al., Appellees, Civil Action No. 10-3770 (D. N.J.). A copy of
the Court's March 7, 2011 Memorandum Opinion is available at
http://is.gd/gexHpjfrom Leagle.com.
About Solomon Dwek
Several creditors filed an involuntary Chapter 7 bankruptcy
petition against Solomon Dwek (Bankr. D. N.J. Case No. 07-11757)
on February 9, 2007. On Feb. 13, 2007, SEM filed for voluntary
Chapter 11. On Feb. 22, 2007, the Dwek bankruptcy case was
converted to Chapter 11 and it was administratively consolidated
with the SEM bankruptcy. Charles A. Stanziale, Jr., has been
appointed trustee in Mr. Dwek's Chapter 11 bankruptcy.
SONJA TREMONT-MORGAN: May Pursue Appeal on $7 Million Judgment
--------------------------------------------------------------
Bankruptcy Judge Shelley C. Chapman granted Sonja Tremont-Morgan
relief from the automatic stay imposed in her Chapter 11
bankruptcy case so she may pursue appeal from a $7 million
judgment in a dispute with Hannibal Pictures Inc.
Ms. Tremont-Morgan is part of the realty TV show "Real Housewives
of New York City." Rachel Feintzeig, writing for Dow Jones' Daily
Bankruptcy Review, relates that Ms. Tremont-Morgan sought Chapter
11 protection on Nov. 17, 2010, citing $19.8 million in debt and
$13.5 million in assets. According to court papers, she blamed
her financial downfall on a failed venture with Hannibal Pictures
to make a movie starring John Travolta, to be called "Fast Flash
to Bang Time."
According to DBR, Ms. Tremont-Morgan wants the 9th U.S. Circuit
Court of Appeals in San Francisco to reverse the "highly
controversial and large judgment" that she claims was a mistake.
SUNCAL COS: Residents Raise Doubt Over Project Amid Bankruptcy
--------------------------------------------------------------
Linda Blaser, writing for Sun-Times Media's Pioneerlocal.com,
reported that Lake Bluff, Ill. residents are weighing in on the
request by Stonebridge LLC officials to lift the age restriction
on the beleaguered housing development on Green Bay Road.
According to the report, Trustee John Josephitis said during a
meeting early this month at Village Hall that residents have told
him they want new impact studies on traffic, schools, police, fire
and ambulance service should a non-age-restricted development be
completed. They also questioned the track record of the new
owner, SunCal of California, noting that SunCal has properties in
Chapter 11 bankruptcy.
SunCal has been asked to address that issue at the upcoming public
hearings.
The report notes the Zoning Board of Appeals will meet at 7 p.m.
on March 16; the Plan Commission at 6:30 p.m. on March 17. Both
hearings will be held in Village Hall, 40 E. Center, second floor.
The Planned Residential Development Ordinance was approved in
November 2006 for an 85-unit subdivision, including 43 single-
family detached units, 28 attached duplex units, up to nine
condominiums in the historic Manor House and up to five units in
the historic Gate House.
About SunCal Companies
SunCal Companies -- http://www.suncal.com/-- has more than
250,000 residential lots and 10 million square feet of commercial
space in various stages of development throughout California,
Arizona, Nevada and New Mexico. Some of SunCal's communities
include Amerige Heights in Fullerton, Lincoln Crossing near
Sacramento and Terra Lago and Fairway Canyon near Palm Springs.
SunCal Companies recently added an active-adult, commercial,
homebuilding, multifamily and urban divisions; and expanded to
Florida, Texas and Washington, D.C.
Gramercy Warehouse Funding LLC and several creditors filed
involuntary petitions each against LBREP/L-SunCal Master I
LLC, LBREP/L-SunCal McAllister Ranch LLC, LBREP/L-SunCal McSweeny
Farms LLC, and LBREP/L-SunCal Summerwind Ranch LLC on Sept. 11,
2008 (Bankr. C.D. Calif Case No. 08-15588, 08-15637, 08-15639, and
08-15640). Daniel H. Reiss, Esq., at Levene, Neale, Bender,
Rankin & Brill represents the petitioners.
SunCal affiliates led by Palmdale Hills Property, LLC, filed
voluntary Chapter 11 petitions (Bankr. C. D. Calif. Case No. 08-
17206) on Nov. 6, 2008. Affiliates that also filed separate
Chapter 11 petitions include: SunCal Beaumont Heights, LLC; SunCal
Johannson Ranch, LLC; SunCal Summit Valley, LLC; SunCal Emerald
Meadows LLC; SunCal Bickford Ranch, LLC; SunCal Communities I,
LLC; SunCal Communities III, LLC; and SJD Development Corp.
Paul J. Couchot, Esq., at Winthrop Couchot P.C., represents
Palmdale Hills in its restructuring effort. The Company estimated
assets and debts of $100 million to $500 million in its Chapter 11
petition.
SUPER MART: Case Summary & 7 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Super Mart Corporation - NVA
10313 Henderson Road
Fairfax Station, VA 22039
Bankruptcy Case No.: 11-11682
Chapter 11 Petition Date: March 10, 2011
Court: U.S. Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Stephen S. Mitchell
Debtor's Counsel: Gregory H. Counts, Esq.
TYLER, BARTL, RAMSDELL & COUNTS, PLC
300 North Washington St. Suite 202
Alexandria, VA 22314-4252
Tel: (703) 549-7178
Fax: (703) 549-5011
E-mail: gcounts@tbrclaw.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/vaeb11-11682.pdf
The petition was signed by Satpal Singh, owner.
THORNBURGH RESORT: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Thornburgh Resort Company, LLC
P.O. Box 264
Bend, OR 97702
Bankruptcy Case No.: 11-31897
Chapter 11 Petition Date: March 11, 2011
Court: U.S. Bankruptcy Court
District of Oregon
Judge: Trish M. Brown
Debtor's Counsel: Gary U. Scharff, Esq.
LAW OFFICE OF GARY UNDERWOOD SCHARFF
621 SW Morrison Street, #1300
Portland, OR 97205
Tel: (503) 493-4353
E-mail: gs@scharfflaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at:
http://bankrupt.com/misc/orb11-31897.pdf
The petition was signed by Kameron DeLashmutt, manager.
TOMAS CONCEPCION: Filing of Claim Does Not Determine Entitlement
----------------------------------------------------------------
Bankruptcy Judge Brian K. Tester granted a claimant's request for
reconsideration and held that its Claim number 20-1 will be
considered as timely filed.
Tomas Irizarry Concepcion filed a Chapter 11 petition (Bankr. D.
P.R. Case No. 05-01282) in the midst of litigation between the
Debtor and the claimant in the Commonwealth of Puerto Rico's Court
of First Instance, Superior Court of Mayaguez. When the Debtor
filed its bankruptcy petition on February 10, 2005, 11 U.S.C. Sec.
362 stayed the litigation. On Feb. 4, 2009, the Court entered an
order confirming the Debtor's plan. That same day, the movant
filed a claim against the estate and a motion requesting
reconsideration of the Court's order confirming the plan, arguing
that its failure to file its claim within the claims deadline was
the result of excusable neglect, and thus should be considered
timely under Fed. R. Bankr. P. 9006. The Court denied the claim
and its corresponding motion as untimely on Dec. 29, 2009. The
movant then appealed to the United States Bankruptcy Appellate
Panel for the First Circuit, which vacated and remanded the matter
back to the Court to make findings and conclusions with respect to
the equitable standards set forth in Pioneer Inv. Serv. Co. v.
Brunswick Assoc. L.P., 507 U.S. 380 (1993). The parties then
filed briefs addressing the Pioneer framework, which have been
submitted and are under advisement.
According to Judge Tester, if the Court allows the movant to file
its claim, the Debtor will not be prejudiced because merely
allowing a claim to be filed does not determine a claimant's
entitlement thereto.
A copy of the Court's March 10, 2011 Opinion and Order is
available at http://is.gd/pFHkgTfrom Leagle.com.
TRIBUNE CO: Bank Debt Trades at 30% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Tribune Co. is a
borrower traded in the secondary market at 69.71 cents-on-the-
dollar during the week ended Friday, March 11, 2011, a drop of
1.57 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 300 basis points above LIBOR to borrow
under the facility, which matures on May 17, 2014. Moody's has
withdrawn its rating on the bank debt. The loan is one of the
biggest gainers and losers among 180 widely quoted syndicated
loans with five or more bids in secondary trading for the week
ended Friday.
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)
UNI-PIXEL INC: Incurs $3.81 Million Net Loss in 2010
----------------------------------------------------
Uni-Pixel, Inc., filed its annual report on Form 10-K with the
U.S. Securities and Exchange Commission reporting a net loss of
$3.81 million on $243,519 of thin film revenue for the year ended
Dec. 31, 2010, compared with a net loss of $5.37 million on $0 of
thin film revenue during the prior year.
The Company's balance sheet at Dec. 31, 2010 showed $13.21 million
in total assets, $427,447 in total liabilities and $12.79 million
in total shareholders' equity.
"2010 was a milestone year for UniPixel," said Reed Killion, the
company's president and CEO. "It represented the beginning of our
transition to a production stage company after several years of
research and development - a period in which we established
multiple patents and proprietary processes related to our
performance engineered films and related display technologies.
With a highly successful funding completed in December, we are now
fully engaged in monetizing this award-winning IP."
A full-text copy of the Annual Report is available for free at:
http://ResearchArchives.com/t/s?74f3
About Uni-Pixel Inc.
The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL)
-- http://www.unipixel.com/-- is a production stage company
delivering its Clearly Superior(TM) Performance Engineered Films
to the Lighting & Display, Solar and Flexible Electronics market
segments.
The Company's balance sheet as of Sept. 30, 2010, showed
$1.26 million in total assets, $4.15 million in total liabilities,
and a stockholders' deficit of $2.89 million.
PMB Helin Donovan, LLP, in Houston, 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 sustained losses and negative cash
flows from operations since inception.
UNISYS CORP: Lists 2.25MM Shares of Preferred Stock With NYSE
-------------------------------------------------------------
Unisys Corporation registered with the New York Stock Exchange
2.25 million shares of 6.25% Mandatory Convertible Preferred
Stock, Series A with an initial liquidation preference of $100 per
share. The description of the Mandatory Convertible Preferred
Stock of the Company is set forth in the prospectus supplement
dated Feb. 22, 2011 to the Company's registration statement on
Form S-3, as filed with the Securities and Exchange Commission on
May 14, 2009, which prospectus is available for free at:
http://ResearchArchives.com/t/s?7503
About Unisys Corp.
Based in Blue Bell, Pennsylvania, Unisys Corporation (NYSE: UIS)
-- http://www.unisys.com/-- provides a portfolio of IT services,
software, and technology that solves critical problems for
clients. With more than 26,000 employees, Unisys serves
commercial organizations and government agencies throughout the
world.
The Company's balance sheet at Dec. 31, 2010, showed $3.02 billion
in total assets, $3.95 billion in total liabilities and
a $933.80 million stockholders' deficit.
As reported by the Troubled Company Reporter on Feb. 24, 2011,
Moody's Investors Service has affirmed Unisys' B1 corporate family
rating and all other ratings, and also changed the rating outlook
to positive from stable. This outlook change follows the
announcement by Unisys of plans to issue mandatory convertible
preferred stock, redeem secured notes, and tender for additional
bonds which Moody' estimates will reduce secured debt by up to
$390 million. Upon completion of the transactions, the loss given
default assessments will be revised based on the remaining debt
balances.
UNITED CONTINENTAL: Circuit Court Affirms Ruling on Regen Issue
---------------------------------------------------------------
Judges Kanne, Tinder and Hamilton of the U.S. Court of Appeals for
the Seventh Circuit affirmed the U.S. District Court for the
Northern District of Illinois' judgment holding that ReGen Capital
I, a purchaser of a prepetition unsecured claim arising from
executory contracts is not entitled to a "cure" that would pay it
100 cents on the dollar for the claim because United Air Lines,
Inc. did not assume the executory contracts at issue.
AT&T Corporation and ReGen entered into a contract whereby AT&T
assigned to ReGen prepetition unsecured claims that AT&T held
against United. One of these claims was a general unsecured claim
for $5.4 million that AT&T asserted against United after United
defaulted on a series of contracts for telecommunications
services. The U.S. Bankruptcy Court for the Northern District of
Illinois later reduced the Claim to $4.9 million.
ReGen filed a notice of transfer of claim and a notice of
assignment of claim that recorded the claims trader's purchase of
the AT&T Claim under their assignment agreement.
United filed its Chapter 11 Plan of Reorganization in 2005, which
provided for the assumption and rejection of executory contracts
and the means for curing any default on those contracts. In an
exhibit to the Plan, United listed 10 AT&T executory contracts.
The Plan exhibit did not, however, list any approved or agreed
cure amounts.
The Circuit Court noted that the Plan included a reservation of
rights that allowed United to reject any executory contract up to
15 days after the later of (1) the date on which the contracting
parties agreed to the amount of the cure, or (2) the issuance of a
final order from the Bankruptcy Court establishing the cure.
The Bankruptcy Court confirmed United's Plan in February 2006.
United then paid ReGen $626,000 in new common stock.
Believing that United intended to assume the AT&T contracts from
which the general unsecured claim arose, ReGen filed a cure claim
in United's bankruptcy case to collect the full amount of the
default. ReGen calculated a cure claim of $4.3 million, the total
amount owed to AT&T under the AT&T contracts, less the value of
the new common stock that ReGen received in the earlier
distribution.
United objected to ReGen's cure claim and subsequently filed a
notice to reject the AT&T Contracts.
The Bankruptcy Court denied ReGen's cure claim on two grounds:
(i) the Bankruptcy Court determined that AT&T had not assigned
ReGen a right that entitled it to file for a cure under
Section 365(b)(1)(A) of the Bankruptcy Code; and
(ii) the bankruptcy judge concluded that, in any case, United
had rejected the AT&T contracts, foreclosing any
opportunity for AT&T or ReGen to seek cure.
Regen took an appeal from the Bankruptcy Court's decision to the
District Court, which affirmed the Bankruptcy Court's ruling on
both grounds. ReGen then turned to the Circuit Court.
The three-judge panel disagreed with the Bankruptcy Court and
District Court's conclusion that the language of the AT&T
assignment restricted ReGen's treatment to that of a general
unsecured claim holder.
The panel held that the Assignment Agreement's definition of claim
is broad enough to include the right to collect a cure amount
arising from AT&T's original contracts. The panel elaborated that
under the 2002 Agreement, ReGen received not only the general
unsecured claim but also any actions, claims, lawsuits or rights
"arising out of or in connection with" that claim.
However, the panel upheld the Bankruptcy and District Courts'
determination that United rejected the AT&T Contracts, foreclosing
any opportunity for AT&T or ReGen to seek cure.
The panel stated that a claim holder's right to a cure claim is
realized only if the debtor chooses to assume the executory
contract under which the debt arose.
The panel determined that United effectively rejected the AT&T
Contracts, as the Bankruptcy Court held in interpreting its order
confirming the Plan.
The panel also opined that the explicit reservation of United's
right to reject in the Plan gave it the right to reject the A&T
contracts when it did. Neither of the two conditions activating
the 15-day expiration had occurred, the panel pointed out.
United's valid rejection under the provision of the Plan
extinguished any right that ReGen would have had to the cure
amount, the panel determined.
Section 365(d) provides that the trustee or debtor-in-possession
may assume or reject an executory contract at any time before the
confirmation of a plan. According to the panel, some courts have
held that this permissive language leaves open the possibility
that any executory contract may ride through plan confirmation
unaffected, neither assumed or rejected.
The panel opined that if ReGen wanted to argue that the ride-
through possibility violated Section 365 or Chapter 11, the time
to do it would have been before confirmation. By failing to
object to or appeal the Plan's confirmation, ReGen lost any
opportunity to seek an exemption from or to challenge this
provision, the panel concluded.
A full-text copy of the Circuit Court's Decision dated
February 18, 2011, is available for free at:
http://bankrupt.com/misc/United_7thCircuitFeb18Decision.pdf
About United Continental
United Continental Holdings, Inc. (NYSE: UAL) --
http://www.UnitedContinentalHoldings.com/, http://www.united.com/
and http://www.continental.com/-- is the holding company for both
United Airlines and Continental Airlines. Together with United
Express, Continental Express and Continental Connection, these
airlines operate a total of approximately 5,800 flights a day to
371 airports throughout the Americas, Europe and Asia from their
hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles,
New York, San Francisco, Tokyo and Washington, D.C. United and
Continental are members of Star Alliance, which offers more than
21,200 daily flights to 1,172 airports in 181 countries worldwide
through its 28 member airlines. United's and Continental's more
than 80,000 employees reside in every U.S. state and in many
countries around the world.
United Continental carries 'B2' corporate family and probability
of default ratings, with stable outlook, from Moody's, 'B' issuer
credit ratings, with stable outlook, from Standard & Poor's, and
'B-' issuer default rating from Fitch.
UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr.
N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represented the Debtors in their
restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein
Nath & Rosenthal LLP represented the Official Committee of
Unsecured Creditors. Judge Eugene R. Wedoff confirmed a
reorganization plan for United on Jan. 20, 2006. The Company
emerged from bankruptcy on Feb. 1, 2006.
At Sept. 30, 2010, United Continental had $20.055 billion in total
assets against total current liabilities of $8.256 billion, long-
term debt of $6.025 billion, long-term obligations under capital
leases of $906 million, other liabilities and deferred credits of
$7.074 billion, and a stockholders' deficit of $2.206 billion.
UNITED CONTINENTAL: To Reduce Capacity as Oil Prices Rise
---------------------------------------------------------
United Continental Holdings, Inc. said in a March 8, 2011 public
statement accompanying its traffic results for the month of
February 2011 that it plans to reduce consolidated capacity for
2011 in response to the recent increase in fuel prices.
Specifically, the Company plans to reduce consolidated capacity
from its previous 2011 projections by approximately 1 percent
effective with its May schedule and 4 percent effective with its
September schedule. With these reductions, fourth quarter 2011
consolidated domestic capacity is expected to decrease 5 percent
and consolidated international capacity is expected to increase 2
percent compared to the pro forma capacity for the same period
last year, the Company noted. The capacity changes will be
accomplished through reducing flight frequencies, indefinitely
postponing the start of flights to certain markets and exiting
less profitable routes.
The Company expects its full-year 2011 consolidated capacity to be
roughly flat year-over-year, down from its prior guidance of up 1
to 2 percent. The Company also anticipates full-year 2011
international capacity to be up 2.5 to 3.5 percent and full-year
2011 domestic capacity to be down 1.5 to 2.5 percent year-over-
year.
The Company is also analyzing the removal of certain less fuel-
efficient aircraft from its fleet and will be taking other cost
saving measures concurrent with the capacity reductions.
A related report by Hannah G. Vickers of Medill Reports - Chicago
noted that the recent weeks have not been smooth sailing for
United Continental given the unrest in the Middle East and its
impact on fuel prices.
Helane Becker, an analyst at Dahlman Rose & Co LLC, stated that
roughly 30% of the cost for United Continental is fuel, Medill
Reports said. According Ms. Becker, the cost has risen 25%, which
translates to a 6% increase in costs, Medill Reports noted.
According to the report, United Continental raised its fares five
times compared to competitors' six times in the past two months.
Indeed, NY Daily News reported on February 9, 2011 that United
increased its fares by $10 per round trip in 48 states. Another
report by The Commercial Appeal revealed that United raised its
fares on U.S. business travelers by $20 to $60 for a round-trip
ticket. United also raised fares on first-class and instant-
upgrade coach tickets, The Commercial Appeal said.
Michael Linenderg, an analyst at Deutsche Bank AG, observed that
the number of fare increases for 2011 are already at par with the
total fare increases in 2009 and 2010, Medill Reports noted.
In addition, Mr. Linenderg wrote in a research note that the
extent of the increase in oil prices is significant as per
penny/gallon rise in jet fuel is expected to cost the airlines
$170 million per annum, Medill Reports related. Morgan Stanley
analysts predicted in a note that airlines will have to struggle
with rising oil prices for a while as tensions in the Middle East
loom, Medill Reports stated.
Wall Street expects United Continental to have a bumpy first
quarter with an estimated loss of 35 cents per share due to fuel
prices and costs associated with the merger, Medill Reports said,
citing Bloomberg LP. Analysts, however, anticipate that United
Continental will have earnings per share of $4.18, Medill Reports
added.
Bob McAdoo, an analyst at Avondable Partners LLC, is confident
that United Continental will be profitable despite the rising fuel
costs but cautioned that there will be limits to that
profitability, Medill Reports relayed.
Overall earnings for the airline industry will be 50% less this
year than in 2010 as rising oil prices limit the benefits of a
rebounding economy, Bloomberg News reported, citing the
International Air Transport Association.
The IATA cut its forecast for industry profit to $8.6 billion from
a $9.1 billion it projected three months ago, Bloomberg noted.
The IATA also raised its oil-price prediction to $96 a barrel for
Brent crude from $84, lifting the industry fuel bill by $10
billion to $166 billion, Bloomberg said.
IATA Chief Executive Officer Giovanni Bisignani said in a
statement, "Today, oil is the biggest risk." "If rises stall the
global economic expansion, the outlook will deteriorate very
quickly," Mr. Bisignani emphasized, Bloomberg noted.
The IATA also forecasted revenue of $594 billion for the industry
this year with a profit margin of 1.4%, Bloomberg said. According
to Bloomberg, airlines as a group have lost money in seven of the
last ten years.
The IATA also predicted a 5.6% increase of passenger growth from
5.2% and cargo growth of 6.1% from 5.5%, Bloomberg noted.
According to the IATA, North American carriers will deliver $3.2
billion in profit, down from $.47 billion profit in 2010,
Bloomberg relayed.
About United Continental
United Continental Holdings, Inc. (NYSE: UAL) --
http://www.UnitedContinentalHoldings.com/, http://www.united.com/
and http://www.continental.com/-- is the holding company for both
United Airlines and Continental Airlines. Together with United
Express, Continental Express and Continental Connection, these
airlines operate a total of approximately 5,800 flights a day to
371 airports throughout the Americas, Europe and Asia from their
hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles,
New York, San Francisco, Tokyo and Washington, D.C. United and
Continental are members of Star Alliance, which offers more than
21,200 daily flights to 1,172 airports in 181 countries worldwide
through its 28 member airlines. United's and Continental's more
than 80,000 employees reside in every U.S. state and in many
countries around the world.
United Continental carries 'B2' corporate family and probability
of default ratings, with stable outlook, from Moody's, 'B' issuer
credit ratings, with stable outlook, from Standard & Poor's, and
'B-' issuer default rating from Fitch.
UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr.
N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represented the Debtors in their
restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein
Nath & Rosenthal LLP represented the Official Committee of
Unsecured Creditors. Judge Eugene R. Wedoff confirmed a
reorganization plan for United on Jan. 20, 2006. The Company
emerged from bankruptcy on Feb. 1, 2006.
At Sept. 30, 2010, United Continental had $20.055 billion in total
assets against total current liabilities of $8.256 billion, long-
term debt of $6.025 billion, long-term obligations under capital
leases of $906 million, other liabilities and deferred credits of
$7.074 billion, and a stockholders' deficit of $2.206 billion.
UNITED CONTINENTAL: Makes $224-Mil. Profit-Sharing Payments
-----------------------------------------------------------
United Continental Holdings, Inc. distributed $224 million in
profit-sharing to employees on February 14, 2011 based on 2010
profits, according to a public statement on the same date.
"The United and Continental teams did a great job in 2010," said
Jeff Smisek, president and CEO of United Continental Holdings.
"Profit-sharing shows that when we work together, we win
together."
Mr. Smisek handed out profit-sharing checks at the airline's hubs
at George Bush Intercontinental Airport in Houston and Chicago
O'Hare International Airport. Other United officers traveled to
many other locations throughout the new United's system to
distribute profit-sharing checks to co-workers.
In addition to profit-sharing, the new United's employees received
cash payments for reaching on-time performance goals. The on-time
incentive program pays co-workers up to $100 monthly when the
combined airline hits targets for domestic and international on-
time arrivals. The program reinforces the new United's commitment
to working together to deliver outstanding performance for its
customers.
About United Continental
United Continental Holdings, Inc. (NYSE: UAL) --
http://www.UnitedContinentalHoldings.com/, http://www.united.com/
and http://www.continental.com/-- is the holding company for both
United Airlines and Continental Airlines. Together with United
Express, Continental Express and Continental Connection, these
airlines operate a total of approximately 5,800 flights a day to
371 airports throughout the Americas, Europe and Asia from their
hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles,
New York, San Francisco, Tokyo and Washington, D.C. United and
Continental are members of Star Alliance, which offers more than
21,200 daily flights to 1,172 airports in 181 countries worldwide
through its 28 member airlines. United's and Continental's more
than 80,000 employees reside in every U.S. state and in many
countries around the world.
United Continental carries 'B2' corporate family and probability
of default ratings, with stable outlook, from Moody's, 'B' issuer
credit ratings, with stable outlook, from Standard & Poor's, and
'B-' issuer default rating from Fitch.
UAL Corp filed for Chapter 11 protection on Dec. 9, 2002 (Bankr.
N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represented the Debtors in their
restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein
Nath & Rosenthal LLP represented the Official Committee of
Unsecured Creditors. Judge Eugene R. Wedoff confirmed a
reorganization plan for United on Jan. 20, 2006. The Company
emerged from bankruptcy on Feb. 1, 2006.
At Sept. 30, 2010, United Continental had $20.055 billion in total
assets against total current liabilities of $8.256 billion, long-
term debt of $6.025 billion, long-term obligations under capital
leases of $906 million, other liabilities and deferred credits of
$7.074 billion, and a stockholders' deficit of $2.206 billion.
VIEW SYSTEMS: Accumulated Losses Cue Going Concern Doubt
--------------------------------------------------------
View Systems, Inc., filed on March 10, 2011, its annual report on
Form 10-K for the fiscal year ended Dec. 31, 2010.
Robert L. White & Associates, Inc., in Cincinnati, Ohio, expressed
substantial doubt about View Systems' ability to continue as a
going concern. The independent auditors noted that the Company
had a net loss of $513,353 for the year ended Dec. 31, 2010, and
has an accumulated deficit of $22,837,787 at Dec. 31, 2010.
The Company reported a net loss of $513,353 on $768,026 of
revenues for 2010, compared with a net loss of $1,560,012 on
$631,757 of revenues for 2009.
The Company's balance sheet as of Dec. 31, 2010, showed
$1,160,346 in total assets, $1,361,427 in total liabilities,
and a stockholders' deficit of $201,081.
A full-text copy of the Form 10-K is available for free at:
http://researcharchives.com/t/s?7508
Baltimore, Md.-based View Systems, Inc., develops, produces and
markets computer software and hardware systems for security and
surveillance applications.
VILLAJE DEL RIO: Dist. Court Rules on Andres Holding Dispute
------------------------------------------------------------
District Judge Xavier Rodriguez ruled on the separate motions for
summary judgment filed by the counterparties in the suits, ANDRES
HOLDING CORPORATION, Plaintiff, v. VILLAJE DEL RIO, LTD., ET AL.,
Defendants; and GEORGE GEIS, Plaintiff, v. ANDRES HOLDING
CORPORATION, Defendant, Civil Action Nos. SA-09-CV-127-XR, SA-09-
CV-268-XR (W.D. Tex.). Geis' Motion for Summary Judgment and
VDR's Motion for Summary Judgment are granted in part and denied
in part. Summary judgment is granted to Geis on Andres' fraud and
fraudulent inducement claims as those claims were not pled with
the requisite particularity. Summary judgment is denied on the
issue of Geis' alter ego liability for VDR's actions. Summary
judgment is denied to Geis on Andres' breach of contract claims.
Summary judgment is also denied to Geis on Andres' tortious
interference claims, as those claims are not barred by the statute
of limitations.
Andres' Motion for Summary Judgment is denied. Summary judgment
is denied to Andres on Geis' fraudulent conveyance claims under
the Texas Uniform Fraudulent Transfer Act and the Bankruptcy Code.
Geis' objection to Andres' proof of claim (Claim No. 7) also
remains pending.
A copy of the Court's March 8, 2011 Order is available at
http://is.gd/1iY8r9from Leagle.com.
Headquartered in San Antonio, Texas, Villaje Del Rio Ltd. is a
real estate developer. The company filed for chapter 11
protection on May 1, 2006 (Bankr. W.D. Tex. Case No. 06-50797),
represented by Eric J. Taube, Esq., and Mark Curtis Taylor, Esq.,
at Hohmann, Taube & Summers, L.L.P. No Official Committee of
Unsecured Creditors was appointed in the Debtor's case. When the
Debtor filed for protection from its creditors, it estimated
assets of less the $50,000 and estimated debts between $10 million
and $50 million.
The Debtor filed a Chapter 11 plan in June 2006, which was never
approved. The matter was later converted to a Chapter 7
liquidation.
That Plan, amended a couple of times, contemplated an auction of
the Debtor's real property for a minimum bid price of $4.5
million, and construction of the litigation claims against
Deutsche Bank, the United States Department of Housing and Urban
Development and Colina Del Rio, L.P., as well as claims against
Andres Construction for breach of contract and negligence and The
Hartford Fidelity & Bonding. The Plan contemplated that unsecured
creditors would receive a percentage recovery of their claim
unless they elect to receive a lump sum payment of $100 as a Class
VI convenience creditor. Pursuant to the Plan, as the Debtor's
representative, George Geis, Esq., at Hohmann, Taube & Summers,
LLP, would guarantee payment of fees and expenses for the
prosecution of the Litigation Claims. Fees and expenses for
pursuing the Litigation Claims was expected to exceed $200,000.
Geis, however, would be allowed a claim totaling $1.5 million,
which would be paid with the excess cash flow, if any, from the
Debtor after all senior classes were paid in full. Equity
Interests Holders would get nothing.
VITESSE SEMICONDUCTOR: Register 2.5-Mil. Shares for Emplyee Plan
----------------------------------------------------------------
In a Form S-8 filing with the U.S. Securities and Exchange
Commission, Vitesse Semiconductor Corporation registered
2.5 million shares of common stock under the Vitesse Semiconductor
Corporation 2011 Employee Stock Purchase Plan. The Offering has a
proposed maximum offering price of $5.30 per share and a proposed
aggregate offering price of $13.25 million.
About Vitesse
Based in Camarillo, California, Vitesse Semiconductor Corporation
(Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs,
develops and markets a diverse portfolio of semiconductor
solutions for Carrier and Enterprise networks worldwide.
In October 2009, Vitesse completed a debt restructuring
transaction that resulted in the conversion of 96.7% of the
Company's 2024 Debentures into a combination of cash, common
stock, Series B Preferred Stock and 2014 Debentures. With respect
to the remaining 3.3% of the 2024 Debentures, Vitesse settled its
obligations in cash. Additionally, Vitesse repaid $5.0 million of
its $30.0 million Senior Term Loan, the terms of which were
amended as part of the debt restructuring transactions.
The Company reported a net loss of $7.73 million on $37.45 million
of net revenue for the three months ended Dec. 31, 2010, compared
with a net loss of $33.86 million on $41.65 million of net revenue
for the same period a year ago.
The Company's balance sheet at Dec. 31, 2010 showed $87.98 million
in total assets, $116.23 million in total liabilities and
$28.25 million in total stockholders' deficit.
W&T OFFSHORE: S&P Changes Ratings on $450 Mil. Senior Notes to 'B'
------------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its issue
and recovery ratings on W&T Offshore Inc.'s 8.25% $450 million
senior unsecured notes due 2014. S&P lowered the issue rating to
'B' (same as the corporate credit rating) from 'B+'. S&P revised
the recovery rating to '3', indicating S&P's expectation of
meaningful recovery (50% to 70%) in a default scenario, from '2'.
"S&P is updating its recovery analysis on U.S. exploration and
production company W&T to reflect an updated valuation of 2010
year end reserves based on a company provided PV10 report," said
Standard & Poor's credit analyst Vishal Merani. S&P is using
Standard & Poor's recently revised recovery methodology using
S&P's stressed price deck assumptions of $45 per barrel of West
Texas Intermediate crude oil and $4.00 per million BTU of Henry
Hub natural gas. This update results in a decrease in S&P's
valuation in a default scenario thus revising the recovery rating
on the unsecured notes.
The ratings on oil and gas exploration and production company W&T
Offshore Inc. reflect the company's geographic concentration in
the high-risk offshore Gulf of Mexico, high finding and
development costs, weak internal reserve replacement measures, and
current softness in natural gas prices. Standard & Poor's ratings
on W&T also reflect good liquidity, management's long operating
history in the Gulf, healthy oil prices, and a well-balanced
production mix between crude oil and natural gas.
Ratings List
W&T Offshore Inc.
Corporate credit rating B/Stable/--
Downgraded; Recovery Rating Revised
To From
-- ----
8.25% $450 mil. sr unsecd notes due 2014 B B+
Recovery rating 3 2
WASHINGTON MUTUAL: Confirms Release of REIT Series Securities
-------------------------------------------------------------
Washington Mutual, Inc. confirmed that preferred shares classified
as "REIT Series" in class 19 that were tendered into contra-CUSIP
accounts established with The Depository Trust Company have been
released and returned to the target CUSIP accounts, and are
available for trading by the holders of such securities. These
Class 19 REIT Series securities were tendered to contra-CUSIP
accounts for the purpose of identifying and "freezing" trading of
the securities in connection with release and exchange elections
made with respect to WMI's proposed Sixth Amended Joint Plan of
Affiliated Debtors Pursuant to Chapter 11 of the United States
Bankruptcy Code.
The proposed solicitation procedures with respect to WMI's
Modified Sixth Amended Joint Plan of Affiliated Debtors Pursuant
to Chapter 11 of the United States Bankruptcy Code currently
contemplate that holders of the Class 19 REIT Series securities
shall not have an opportunity to resubmit release elections. Such
holders' elections made in connection with the Sixth Amended Plan
shall remain valid and enforceable in connection with the Modified
Plan. To the extent that a holder elected to grant the releases
set forth in the Sixth Amended Plan, such holders' information
shall be recorded in an escrow CUSIP account established with DTC
prior to such holders' securities being released from the contra-
CUSIP.
Security holders affected by these procedures should consult with
their respective financial and legal advisors.
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous non-bank subsidiaries.
Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S.
government regulators. The next day, WaMu and its affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns
100% of the equity in WMI Investment. When WaMu filed for
protection from its creditors, it disclosed assets of
$32,896,605,516 and debts of $8,167,022,695. WMI Investment
estimated assets of $500 million to $1 billion with zero debts.
WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal &
Manges LLP in New York City; Mark D. Collins, Esq., at Richards,
Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari,
Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver &
Hedges, LLP. Fred S. Hodera, Esq., at Akin Gump Strauss Hauer &
Fled LLP in New York City and David B. Stratton, Esq., at Pepper
Hamilton LLP in Wilmington, Del., represent the Official Committee
of Unseucred Creditors. Stephen D. Susman, Esq., at Susman
Godfrey LLP and William P. Bowden, Esq., at Ashby & Geddes, P.A.,
represent the Equity Committee. Stacey R. Friedman, Esq., at
Sullivan & Cromwell LLP and Adam G. Landis, Esq., at Landis Rath &
Cobb LLP in Wilmington, Del., represent JPMorgan Chase, which
acquired WaMu's assets prior to the Petition Date.
On Jan. 7, 2011, the Bankruptcy Court entered a 107-page opinion
determining that the global settlement agreement, among certain
parties including WMI, the Federal Deposit Insurance Corporation
and JPMorgan Chase Bank, N.A., upon which the Plan is premised,
and the transactions contemplated therein, are fair, reasonable,
and in the best interests of WMI. Additionally, the Opinion and
related order denied confirmation, but suggested certain
modifications to the Company's Sixth Amended Joint Plan of
Affiliated Debtors that, if made, would facilitate confirmation.
Washington Mutual has filed with the U.S. Bankruptcy Court for the
District of Delaware a Modified Sixth Amended Joint Plan and a
related Supplemental Disclosure Statement. The Company believes
that the Modified Plan has addressed the Bankruptcy Court's
concerns and looks forward to returning to the Bankruptcy Court to
seek confirmation of the Modified Plan. The hearing for approval
of the Disclosure Statement is set for March 21.
WILLIE'S PLACE: TCA Makes Winning Offer at $6.4 Million
-------------------------------------------------------
The Hillsboro Reporter relates that a New Jersey finance company
may have gottem a surprise on March 1, when it wasn't the only
bidder for Willie's Place at Carl's Corner.
According to the report, the truck stop was sold on the Hill
County Courthouse steps as a result of foreclosure proceedings by
SBL Capital Funding, LLC. When all was said and done, truck-stop
giant Travel Centers of America was the winning bidder at $6.4
million. The truck stop had been posted for foreclosure after a
federal bankruptcy judge in Dallas lifted a stay in January.
The report says SBL had forced the partnership that built the
truck stop to seek Chapter 11 bankruptcy protection last spring
after it initially posted the property for foreclosure.
According to records filed at the courthouse, the partnership
originally borrowed $4,750,000 in February of 2008 to complete the
truck stop.
The report says the loan, from what was described as a "hard-money
lender" in bankruptcy documents, was set to mature in February
2009 and was later extended to February of 2010. Irregular
payments over the life of the loan led SBL to start the
foreclosure process.
The report adds the property was posted for sale on the courthouse
steps last May, but the bankruptcy petition delayed that sale. By
the time a December hearing was held, the payoff had ballooned to
$6.24 million, exclusive of fees and expenses, plus interest was
accruing at a rate of $2,750 per day.
WILLOW CREEK: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Willow Creek Partners, LLC
3200 Lakeside Village Dr., #201
Prescott, AZ 86301
Bankruptcy Case No.: 11-06060
Chapter 11 Petition Date: March 10, 2011
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Redfield T. Baum PCT Sr.
Debtor's Counsel: Mark W. Roth, Esq.
John J. Hebert, Esq.
Wesley Denton Ray, Esq.
POLSINELLI SHUGHART P.C.
One East Washington Street
CityScape Building, Suite 1200
Phoenix, AZ 85004
Tel: (602) 650-2012
Fax: (602) 926-8562
E-mail: mroth@polsinelli.com
jhebert@polsinelli.com
wray@polsinelli.com
Estimated Assets: $1,000,001 to $10,000,000
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 Jason J. Gisi, president of Gisi
Enterprises, Inc., Debtor's manager.
WINDSOR RETIREMENT: Workers Promised Outstanding Salary
-------------------------------------------------------
CAW members at La Chaumiere Retirement Residence in Puce, Ontario
have been promised their back wages after it was placed into
receivership this morning.
The 38 workers, represented by CAW Local 2458, had been on the job
with no income for more than 10 weeks, after the company
repeatedly failed to pay the workers, and other suppliers. The
home was managed by Liberty Assisted Living.
CAW National President Ken Lewenza said that under normal
circumstances the company going into receivership would be
extremely difficult news, but in this case, it could mean a
positive new beginning for the home, the residents and its
workers.
"This group of workers should be applauded for their commitment to
caring for the residents," said Lewenza. "Company owners
exploited the goodwill of the workers at La Chaumiere for their
own profit, putting residents and workers at peril. Finding a new
owner for this facility would be the best possible outcome to what
has been an agonizing experience for workers, residents and their
families."
"The terrible experience at La Chaumiere highlights the actions of
unscrupulous employers in this sector who take advantage of
vulnerable seniors and the workers who care for them," said Bruce
Dickie, CAW Local 2458 president. While exploitation rarely
exists to this degree, poor treatment and lack of concern for
residents is rampant among corporate long term care providers, who
give more consideration to the company's bottom line than to those
in need of care, said Dickie.
The appointed receiver has agreed to pay the workers' outstanding
salary within a week.
The receiver has also agreed to honor all aspects of the
collective agreement and the union has pledged its support to
working with the receiver to find a new owner for the facility.
There was some reprieve on March 4 when court ordered monies were
handed over to the La Chaumiere workers, represented by CAW Local
2458.
WORLD'S FOREMOST: Settlement Announced for Bank's Malpractices
--------------------------------------------------------------
The Federal Deposit Insurance Corporation announced a settlement
with World's Foremost Bank of Sidney, Neb.(WFB), for alleged
unfair and deceptive practices in violation of Section 5 of the
Federal Trade Commission Act as well as violations of the Truth in
Lending Act in connection with WFB's credit card programs. Under
the settlement, WFB has agreed to stipulate to a Consent Order,
provide restitution of approximately $10.1 million to current and
former cardholders; and pay a civil money penalty of $250,000.
The FDIC determined that WFB did not operate its credit card
programs in an appropriate manner concerning certain overlimit
fees, credit line decreases, minimum payments due, late fees,
penalty interest rates, notices to customers, and collection
practices. The Consent Order, in part, requires WFB to correct
the violations of law, develop appropriate policies and procedures
to ensure future compliance, and effectively monitor third-party
agreements and activities.
In agreeing to the issuance of the Consent Order, WFB does not
admit nor deny any liability.
W.R. GRACE: District Court Sets Deadline for Plan Appeals
---------------------------------------------------------
Judge Ronald L. Buckwalter of the U.S. District Court for the
District of Delaware, finding good cause, sets deadlines and
procedures to apply to the filing of any appeal from Judge
Fitzgerald's January 31, 2011 order confirming the Joint Plan of
Reorganization filed by W.R. Grace & Co. and its debtor
affiliates, together with the Official Committee of Asbestos
Personal Injury Claimants, the Official Committee of Equity
Security Holders, and the Asbestos PI Future Claimants'
Representative.
Judge Buckwalter, during the February 23 status conference, said
that objections filed pursuant to Rule 9033 of the Federal Rules
of Bankruptcy Procedure need not be filed, and all objections that
may be or could have been asserted in Rule 9033 objections are
preserved and may be argued as part of the appellate briefing
filed pursuant to Bankruptcy Rules 8001 et seq. To the extent any
party nevertheless chooses to file Rule 9033 objections on or
before February 28, 2011, both that party's objections and Plan
Proponents' responses may be filed in summary fashion, briefly
stating the bases for the objections and responses, with detailed
briefing and support reserved for the appellate briefs regarding
the Confirmation Order to be filed with the District Court.
Judge Buckwalter said any and all parties' appeals from the
Confirmation Orders and any and all objections to the Confirmation
Orders that may be filed pursuant to Rule 9033 of the Federal
Rules of Bankruptcy Procedure will be procedurally, but not
substantively, consolidated.
The procedures applicable to appeals set out in Rules 8001, et
seq., of the Federal Rules of Bankruptcy Procedure will be
followed in the consolidated proceeding, except in these cases:
(a) To the extent not previously filed, Notices of Appeal
will be filed by March 18, 2011, and, in any event, no
Notices of Appeal are due prior to March 18, 2011.
(b) Appellants will file their Statements of Issues on Appeal,
and Appellants and Appellees will file a Joint Designation
of the Record on Appeal by April 1, 2011.
(c) Appellees will file their Counter-Statement of Issues on
Appeal, and any Counter-Designation of the Record on
Appeal by April 5, 2011.
(d) Appellants will file their main briefs by April 25, 2011.
(e) Appellees will file their response briefs by May 25, 2011.
(f) Reply briefs will not be filed unless leave is first
sought and granted by the District Court.
These deadlines will apply to any cross appeals:
April 1, 2011 -- Deadline for filing of notices of cross
appeal
April 11, 2011 -- Deadline for filing of cross appellants'
statement of issues on cross appeal and any
additional designation of the record
April 18, 2011 -- Parties will apprise the Court of the need
of and timing of any cross appellee response
briefs
May 25, 2011 -- Deadline for filing of cross appellants'
briefs
Oral arguments on the appeals are set to be heard by the District
Court on July 12, 2011, at 10:00 a.m., in Courtroom 14A, at 601
Market Street, in Philadelphia, Pennsylvania.
The mediation ordinarily required pursuant to the District Court's
Standing Order dated July 23, 2004, is waived as to appeals of the
Confirmation Order.
Objections
BNSF Railway Company reserves its right, pursuant to the District
Court's February 23 Order, to raise any objection it may have to
Judge Fitzgerald's Jan. 31 Order. In particular, in reliance upon
the February 23 Order, BNSF objects to all findings of fact and
conclusions of law contained in the Jan. 31 Order that in any way
relate to a non-core issue and any objection interposed by BNSF to
the confirmation of the Joint Plan.
Garlock Sealing Technologies LLC also objects to all findings of
fact and conclusions of law contained in the Jan. 31 Order that in
any way relate to a non-core issue, or to the extent any findings
of fact or conclusions of law contained in the Jan. 31 Order
constitute recommendations to the District Court to enter an order
confirming the Plan or enter injunctions pursuant to Section
524(g) of the Bankruptcy Code. Garlock reserves its right,
pursuant to the February 23 Order, to raise any objection it may
have to the Jan. 31 Order.
A group of claimants asserting claims arising from asbestos-
related personal injury caused by Grace's former vermiculite
mining operations in Libby, Montana, object to the confirmation of
the Plan and the proposed findings contained in the Jan. 31 Order
as being:
(i) in error,
(ii) based on an incorrect evidentiary record in that evidence
was improperly admitted or excluded at the hearings on
confirmation of the Plan and in pre-trial proceedings in
respect of the confirmation, and
(iii) insufficient to permit confirmation of the Plan.
The Libby Claimants also reserve the right to further specify
their grounds for objection within a reasonable time following any
determination that the proper remedy of parties aggrieved by the
Jan. 31 Order is to object rather than to appeal.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones,
LLP, represent the Debtors in their restructuring effort. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock
& Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on Jan. 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Court Revises CNA Deal Order with BNSF Issue
--------------------------------------------------------
On Jan. 31, 2011, Judge Judith Fitzgerald approved the settlement
between W.R. Grace & Co. and CNA Financial Corp. and its
affiliates. Pursuant to the Settlement, the CNA Companies agree
to pay $84 million to the Asbestos Personal Injury Trust in seven
annual installments.
BNSF Railway Company later asked the Bankruptcy Court to
reconsider the Jan. 31 Order based on these factors:
(1) The statement in footnote 46, page 40 of the Memorandum
Opinion that the Court overruled BNSF's objection to the
motion seeking approval of the settlement with CNA
Financial Corp. and its affiliates. However, the Court
actually sustained the objection. Clarifying language was
added to the Order approving the settlement as requested by
BNSF.
(2) The statement on page 40 of the Memorandum Opinion that
"There is nothing in the Bankruptcy Code, and BNSF has
pointed to no case law, that indicates that a plan must
pay attorneys' fees in connection with the underlying tort
claims or the indemnity or contribution claims arising
from those torts." In contrast, BNSF's argument that the
Joint Plan of Reorganization must provide for the
allowance of its contractual rights to attorneys' fees was
recognized and implemented by the Plan Proponents by the
addition of Section 5.14 of the TDP, as defined in the
Plan, which provides for allowance of those attorneys'
fees.
(3) BNSF's objection concerning the treatment of its state law
contribution claims. BNSF did not argue that holders of
Direct Claims are being paid 100% of the value of their
claims, while BNSF is being paid 6% of the value of its
claims as the Court stated at page 41 of the Memorandum
Opinion. Rather, BNSF objected that the awarded value of
the claim is improperly reduced, in cases where the Direct
Claimant was exposed solely, or nearly solely, to Grace
asbestos. A third party, like BNSF, who is required to
pay Grace's several share of liability through a
derivative claim should be entitled to receive an award
equal to the full value of Grace's share of liability, and
not be limited to a highly reduced award solely on the
grounds that the Direct Claimant was initially able to
recover from that third party.
Plan Proponents Object
The Plan Proponents complain that BNSF Railway Company asks the
Bankruptcy Court to rewrite history. The Plan Proponents further
complain that BNSF asks the Court to hold that it actually
sustained BNSF's objections to the Debtors' settlement with CNA
Financial Corp. and its affiliates when the Jan. 31 Order properly
held that all objections to confirmation raised by BNSF either
were resolved or overruled.
The Plan Proponents also assert that BNSF, the State of Montana,
and Her Majesty the Queen in Right of Canada each failed to
identify any "clear legal errors" in the Court's Jan. 31 Order.
BNSF Talks Back
BNSF points out that although the Plan Proponents assert that it
has not established any "clear error" that warrants
reconsideration, they nevertheless concede that the Jan. 31 Order
contains several errors that need correction.
BNSF maintains that the Jan. 31 Order -- a promulgated opinion of
the Bankruptcy Court -- contains a misstatement concerning
treatment of BNSF's objection to the CNA settlement agreement.
Deleting the footnote stating that BNSF's objection were
overruled, as proposed by the Plan Proponents, does not correct
this misstatement, BNSF argues.
Another court, well into the future, may be examining the
confirmation orders. It should not be left to speculate as to the
intention of the Grace reorganization court as to this issue, BNSF
further argues.
With regards to its contractual right to attorneys' fees, BNSF
asserts that footnote 46 of the Jan. 31 Order must be corrected.
Whether the Court adopts the Plan Proponents' suggested
introductory language to the new paragraph, or writes it own,
footnote 46 must be corrected, BNSF argues.
BSNF also reiterates that one of its objection -- that the FDP
discriminates against holders of Indirect Claims in situations
where the Debtors were the sole asbestos actor -- has not been
addressed and analyzed by the Court.
BNSF further asserts that its objection, which was misconstrued by
the Court and therefore not analyzed, must be addressed. BNSF
reiterates that if the Plan Proponents' own expert values, the
Debtors' several share of liability in cases where 95% or more of
the asbestos to which the Direct Claimant is exposed arose from
the Debtors at the Extraordinary Claim Value, it is discriminatory
to limit an Indirect Claimant, like BNSF, who is required to pay,
in the first instance, the Debtors' several share of liability, to
an award no greater than 25% of the Extraordinary Claim Value,
where all other claimants in Class 6 are entitled to an award
equal to what the Plan Proponents' experts testified was 100% of
the Debtors' several share of liability.
Her Majesty the Queen in Right of Canada and the State of Montana
separately join in BNSF's arguments. Specifically, the Crown and
Montana agrees with the legal arguments and assertions set forth
by BNSF with respect to the request for reconsideration of the
treatment of contribution and indemnification claims or demands as
they relate to the treatment of Indirect Claimants' pursuit of
Extraordinary Claims pursuant to the Memorandum Opinion and
Proposed Order.
* * *
The Court granted reconsideration regarding BNSF's objection
concerning contractual right to attorneys' fees. Judge Fitzgerald
amended her Jan. 31 Order to add that BNSF's objection concerning
its contractual right to attorneys fees was resolved by the
addition of Section 5.14 to the Trust Distribution Procedures.
The Plan Proponents and counsel for BNSF agreed to this addition
at the hearing on the Motion held on March 2.
Upon consideration of arguments at the March 2 hearing and with
the agreement of the Plan Proponents, the Jan. 31 Order is amended
to state that for the issue concerning the three insurance
policies, which was resolved by an amendment to Exhibit 5 of the
Joint Plan and in the order approving the Debtors' settlement with
the CNA Companies, BNSF's remaining objections were overruled.
The Court, however, denied consideration with respect to the Joint
Plan's treatment of BNSF's state law contribution claims finding
that there is no unfair discriminatory treatment of BNSF's claim.
The Court further found that BNSF's contention regarding the
unfair treatment of its claim under the Joint Plan is not well
founded.
Judge Fitzgerald held that, first, it is hard to imagine a
scenario where an Indirect Claimant, including BNSF, would even
qualify under the Extraordinary Claim standard because, to be
eligible in that category, at a minimum, exposure must have
"occurred predominantly as a result of working in a manufacturing
facility of Grace during a period in which Grace was manufacturing
asbestos-containing products at that facility, or (ii) was at
least 75% the result of exposure to asbestos or an asbestos-
containing product or to conduct for which Grace has legal
responsibility." Judge Fitzgerald points out that Section 5.6 of
the Plan provides a mechanism for an Indirect Claimant to
establish its claim if it cannot meet the "presumptively valid"
criteria, as explained in the Jan. 31 Order.
BNSF argues that there is improper discrimination because, in the
tort system, it might suffer a judgment or enter into a settlement
requiring it to pay a Direct Claimant more than what BNSF can
recover from the Trust. However, the Joint Plan is designed to
cap payments regarding Grace's liability and, if a third party
pays Grace's share, to reimburse it in accordance with the terms
of the Plan and TDP and in an amount that does not exceed the cap.
To the extent that a Direct Claimant's recovery against W.R. Grace
& Co. is limited as provided in the TDP, any third party that pays
the Direct Claimant is subrogated to the interests of the Direct
Claimant and can recover no more than the Direct Claimant could
have recovered. This result, Judge Fitzgerald held, is not
discriminatory, let alone unfairly discriminatory. She noted that
Section 1129(b) of the Bankruptcy Code does not prohibit
discrimination under a plan, only discrimination that is unfair,
citing In re Aleris Intern., Inc.,
2010 WL 3492554 *31 (Bankr.D.Del. 2010), In re Bashas' Inc., 437
B.R. 874 (Bankr.D.Ariz. 2010); and In re Genesis health Ventures,
Inc., 280 B.R. 339, 346 (D.Del.2002).
Under the Joint Plan in this bankruptcy case, all Indirect
Claimants are treated similarly and all Direct Claimants are
treated similarly, Judge Fitzgerald noted. The Plan, she said,
would unfairly discriminate if it were structured as BNSF suggests
because, then, Direct Claimants would recover less from the Trust
than would Indirect Claimants. That is, as the Plan is crafted,
with respect to payment by the Trust of any Indirect Claim, BNSF
is in a position no different from any other Indirect Claimant.
Judge Fitzgerald said it is her view that to accept BNSF's
argument that it should be able to recover more from the Trust
than the Trust would be required to pay to a Direct Claimant with
respect to Grace's liability would defeat the purpose of Section
524(g) and nullify its effect. Judge Fitzgerald explained that
the purpose of Section 524(g) in asbestos cases is to ensure that
a debtor's tort liability, present and future, will be satisfied
and that both present and future claims will be paid substantially
the same amount in substantially the same manner under the same
criteria. If an Indirect Claimant like BNSF is permitted to
recover more than even the Direct Claimant could, the purpose of
Section 524(g) to pay the injured tort asbestos claimants would be
defeated and funds that should be reserved for future demand
holders will be dissipated. The Joint Plan confirmed in this case
assures that the requirements of Section 524(g) are met and that
its purpose will be fulfilled, Judge Fitzgerald said.
Judge Fitzgerald clarified that for purposes of this Chapter 11
case, BNSF's claims were estimated at one dollar for voting
purposes only because, as BNSF, concedes, "the total value of its
claim is unliquidated." However, Judge Fitzgerald maintained that
the Joint Plan meets the confirmation standards of the Bankruptcy
Code because, if BNSF's claim becomes fixed, it will be paid, if
allowed, according to the terms of the TDP.
BNSF's argument that it seeks to pursue in the motion for
reconsideration is that it is discriminated against because it
will never be paid 100 percent of any claim it may eventually
have. However, no other creditor in BNSF's class will be paid 100
percent either, Judge Fitzgerald noted. It is, or will be, if its
claims ever become liquidated, an Indirect Asbestos PI Claimant in
Class 6, she noted. As such, it is subject to the TDP and is in
no position different from any other Indirect Claimant, the Court
held.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones,
LLP, represent the Debtors in their restructuring effort. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock
& Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on Jan. 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Wins Approval of Settlement of MassDEP's Claims
-----------------------------------------------------------
The Bankruptcy Court previously approved the settlement between
W.R. Grace & Co. and The Massachusetts Department of Environmental
Protection allowing MassDEP's Claim No. 12849.
The settlement requires the Debtors to pay for cleanup costs at
nine contaminated sites throughout the Commonwealth. MassDEP will
receive more than US$800,000, plus accrued interest, to resolve
MassDEP's environmental liability claims against the Debtors. The
settlement also requires the Debtors to pay for future cleanup
costs and to perform cleanup work at several of the Superfund
sites.
Commenting on the approved settlement, Massachusetts Attorney
General Martha Coakley said "W. R. Grace has the means to pay its
environmental liability to the Commonwealth and perform cleanup
actions at its contaminated properties. We are gratified that the
bankruptcy court agreed it would be wrong to allow Grace to walk
away from its responsibilities."
MassDEP Commissioner Kenneth L. Kimmell said, "MassDEP is pleased
that the settlement requires W. R. Grace to continue response
actions at its sites and to comply with all of its consent
decrees. It also reserves the Commonwealth's right to bring
natural resource damage claims if such damages are found at the
Acton Superfund site, Wells G & H Superfund site, or the Blackburn
& Union Privileges site."
The matter was handled by Assistant Attorney General Carol Iancu
of AG Coakley's Environmental Protection Division with assistance
from Jennifer Davis, Jay Naparstek, Rob Lucci, and others at
MassDEP.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones,
LLP, represent the Debtors in their restructuring effort. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock
& Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on Jan. 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Montana & Libby Victims Negotiate $43-Mil. Settlement
-----------------------------------------------------------------
The State of Montana is in the final stages of negotiating a
$43 million settlement with asbestos victims in Libby, Lynnette
Hintze of the Daily Inter Lake reported on March 6, citing legal
papers obtained by the news agency.
In exchange for releasing the state and various state agencies
from future claims related to W.R. Grace & Co.'s former
vermiculite mine in Libby, more than 1,100 claimants with asbestos
disease would get a portion of the settlement, the report said.
The proposed settlement, according to the report, would release
from liability the State and all of its past and present
departments, boards, division, agencies, officers, employees,
agents, attorneys and successors, including but not limited to the
Department of Environmental Quality, Department of Public Health
and Human Services, Department of Labor and Industry, Montana
State Board of Health and the Division of Air Pollution Control
and Industrial Hygiene.
The general description of the release notes that the State's
release is from Libby mine claims that include all lawsuits,
claims and causes of action "that have been, could have been, or
in the future could be asserted against releasees, including but
not limited to any which arise out of, or are in way related to
the actions, inactions or omissions of releasees relating to
Zonolite Mining Co. or Grace, or any of their predecessors or
successors."
The asbestos victims, whose numbers in the tort claim have
increased from 807 individuals in earlier legal documents to a
total of 1,125 clients last week, have been told the attorneys
will get one-third of the proposed settlement, roughly $14
million, the report said. About $500,000 will be held back for a
contingency fund, the report added. In addition to the McGarvey,
Heberling, Sullivan & McGarvey law firm, Lewis, Slovak, Kovacich &
Marr has clients involved in the tort claim, the report said.
A confidential letter sent to clients by Jon Heberling, Esq., at
the Law Offices of McGarvey, Heberling, Sullivan & McGarvey, P.C.,
in Kalispell, Montana, said the State signed a memorandum of
understanding for the proposed settlement on October 19, 2010, the
report disclosed. The State's insurance company reportedly has
signed a parallel agreement with the State, Daily Inter Lake said.
Terms of the settlement to satisfy the tort claim, according to
the report, won't be divulged until a court has approved the deal.
Clients, the report noted, have been warned not to share details
of the settlement with anyone or the deal could be scrapped.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones,
LLP, represent the Debtors in their restructuring effort. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock
& Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on Jan. 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
WYTHE II CORP: Texas App. Ct. Rules on Stone Fee Dispute
--------------------------------------------------------
Wythe II Corporation, v. John D. Stone, No. 09-09-00397-CV (Tex.
App. Ct., is an appeal by Wythe involving a fee dispute with
attorney John D. Stone. Mr. Stone represented Wythe in a claim
against its insurer, XL Lloyds Insurance Company, Inc., on a
$1.625 million policy. Hurricane Rita damaged apartments owned by
Wythe. At the time the insurance dispute arose, Mr. Stone
represented Wythe and its president, Waleed Khan, in the defense
of litigation brought by a holder of the mortgage on the apartment
complex. Represented by separate counsel skilled in bankruptcy
law, Wythe filed a voluntary bankruptcy petition. The bankruptcy
court approved Mr. Stone's representation of Wythe in the claim
against XL Lloyds. Wythe satisfied the mortgage holder, and
dismissed the bankruptcy proceeding. Mr. Stone subsequently
negotiated a $1,975,000 settlement agreement between Wythe and XL
Lloyds that supplemented a previous payment of $800,000 on the
insurance policy. At the end, the carrier had paid $2,775,000 on
a $1,625,000 policy. A fee dispute arose between Mr. Stone and
Wythe. Mr. Stone intervened in the insurance lawsuit to collect
his fee, and moved to withdraw as counsel for Wythe. Wythe
counterclaimed for fraud and breach of fiduciary duty. XL Lloyds
paid the entire settlement proceeds into the registry of the trial
court.
The trial court denied Wythe's motion for summary judgment,
granted partial summary judgment for Mr. Stone, and submitted to a
jury Mr. Stone's derivative claim to recover attorney fees
incurred in pursuit of the claim for breach of the written
attorney fee contract. The jury found that a reasonable fee for
Mr. Stone's attorney would be $314,420, with additional fees in
the event of an appeal. The trial court signed a judgment against
Wythe in the amount of $1,138,694.47.
Mr. Stone filed a motion for sanctions, alleging that Wythe and
its new counsel submitted false testimony in response to Mr.
Stone's motion for summary judgment. The trial court ordered
Wythe to pay Mr. Stone a penalty of 1% of the amount in the
registry of the court plus attorney fees incurred in pursuing the
motion for sanctions, and additional fees in the event of an
appeal.
The Court of Appeals of Texas, Ninth District, in Beaumont,
affirmed in part the judgment in favor of Mr. Stone on the
contingent-fee contract. The Appellate court held that the
bankruptcy application and order made the contract solely a
contingent-fee contract from the beginning of the representation
on the bankrupt's claim. The Appellate court concluded the
unenforceability of the unilateral option provision does not
render the contingency fee arrangement approved by the bankruptcy
court unenforceable under the circumstances presented.
Wythe suggests that the representation agreement was
unconscionable because it required Wythe to bear all expenses of
litigation. The Appellate court held that an attorney is not
required to bear all litigation costs, but a contingent-fee
contract must state the litigation expenses to be deducted from
the client's recovery. The Appellate court noted that the
parties' contract identified the expenses that were the client's
responsibility.
The Appellate court set aside the sanctions penalty awarded to Mr.
Stone and associated attorney fees. The Appellate court held that
the trial court erred in assessing a penalty to be paid to Mr.
Stone, and in the amount of attorney fees awarded for pursuit of
that order. The Appellate court vacated the part of the sanctions
order that assessed a penalty of $19,750, and the part of the
sanctions order that assessed attorney fees. The jury's verdict
is not supported by sufficient evidence. Accordingly, the
Appellate court reversed the part of the judgment that awarded Mr.
Stone attorney fees for the development of Mr. Stone's breach of
contract claims. The case is remanded to trial court for a new
hearing solely on the remaining issue of the reasonable amount of
attorney fees necessary to enforce the contract.
A copy of the Opinion delivered March 10, 2011, by Appeals court
Chief Justice Steve McKeithen, and Justices David Gaultney and
Charles Kreger, is available at http://is.gd/n7iBOHfrom
Leagle.com. Justice Gaultney wrote the opinion.
About Wythe II Corporation
Wythe II Corporation, dba Brittany Place Apartments, based in
Nederland, Texas, filed for Chapter 11 bankruptcy (Bankr. E.D.
Tex. Case No. 06-10588) on Dec. 29, 2006, represented by Tagnia M.
Fontana, Esq., at Maida Law Firm P.C. Judge Bill Parker presided
over the case. In its petition, the Debtor estimated assets and
debts between $1 million and $100 million.
* Means Test Applies to Cases Converted From Chapter 13
-------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
when an individual's Chapter 13 case is converted to Chapter 7,
the bankruptcy court may employ the means test under Section
707(b)(2) of the Bankruptcy Code, the U.S. Bankruptcy Appellate
Panel for the 8th Circuit, in Fokkena v. Chapman (In re Chapman),
10-6046, ruled on March 11.
Mr. Rochelle notes that Section 707(b)(1) in substance says that
the (b)(2) means test applies to "a case filed by an individual
debtor under this Chapter [7] whose debts are primarily consumer
debts." Lower courts are split on the question of whether the
test can be applied to a case converted to Chapter 7 from Chapter
13. The Appellate Panel from St. Louis said it was bound by a
1982 8th Circuit opinion in a case called Resendez v. Lindquist,
where the appeals court said that a converted case is "deemed"
originally filed in Chapter 7.
* Appellate Panel Shouldn't Make Findings of Fact, Court Says
-------------------------------------------------------------
Bill Rochelle, Bloomberg News' bankruptcy columnist, reports that
the U.S. Court of Appeals in St. Louis in Treadwell v. Glenstone
Lodge Inc. (In re Treadwell), ruled on March 9 that a Bankruptcy
Appellate Panel shouldn't have made its own findings of fact when
the bankruptcy judge hadn't done so on a critical issue. Instead,
the appellate panel should have remanded the case to make
additional finding of fact to determine if the result should be
different. The appellate panel said there wasn't enough evidence
in the case to establish a partnership between a husband and wife.
* New York Community Bank Sells Mortgage on 8 Bronx Buildings
-------------------------------------------------------------
Dow Jones' DBR Small Cap reports that New York Community Bank has
sold the mortgage on eight dilapidated buildings in the Bronx,
bank officials said, disposing of its interests in properties that
have attracted tenant protests. The report relates that the
purchaser bought the mortgage, which had a $16 million balance, at
a discount.
According to the report, the bank declined to identify the buyer
or to say how much the buyer paid.
"We received several offers on the note," DBR quotes Ilene
Angarola, a spokeswoman with New York Community Bancorp, the bank
holding company. "We feel that this party has the experience and
capacity to properly care for and manage the properties," she
added.
Also, tenants in the buildings filed a motion in foreclosure
proceedings for the properties seeking to hold New York Community
Bank responsible for repairs, the report notes.
DBR adds that the tenants said they were requesting funds to fix
leaky roofs, remove mold and update electrical equipment in the
buildings.
* Lynnette Warman Named Fellow of American College of Bankruptcy
----------------------------------------------------------------
The American College of Bankruptcy recently announced that
Lynnette R. Warman, a partner in the Dallas office of Hunton &
Williams LLP, will be inducted as a Fellow of the College on
March 18, in Washington, DC. The ceremony will take place at the
U.S. Supreme Court in the Great Hall, and will be presided over by
Paul M. Singer, Chair of the College.
Ms. Warman is one of 40 nominees from the United States and abroad
being inducted in the Twenty-Second Class (2011) of College
Fellows. All are being honored and recognized for their
professional excellence and exceptional contributions to the
fields of bankruptcy and insolvency.
Ms. Warman focuses her practice on corporate reorganizations, out
of court work-outs and structured financial transactions. Her
recent engagements have involved significant mediation, litigation
and appellate work in both bankruptcy and other federal courts.
In May 2010, Ms. Warman was elected Vice President of Publications
for the American Bankruptcy Institute. She serves on the
executive committee of ABI's Board of Directors, is a member of
the publications committee of the board, and was formerly the
co-executive editor of the ABI Journal. Ms. Warman holds a J.D.
from Creighton University School of Law and a B.A. from University
of Nebraska.
The American College of Bankruptcy is an honorary professional and
educational association of bankruptcy and insolvency
professionals. The College plays an important role in sustaining
professional excellence. College Fellows include commercial and
consumer bankruptcy attorneys, insolvency accountants, turnaround
and workout specialists, law professors, judges, government
officials and others involved in the bankruptcy and insolvency
community. Nominees are extended an invitation to join based on a
record of achievement reflecting the highest standards of
professionalism.
About Hunton & Williams LLP
Hunton & Williams LLP -- http://www.hunton.com/-- provides legal
services to corporations, financial institutions, governments and
individuals, as well as to a broad array of other entities. Since
its establishment more than a century ago, Hunton & Williams has
grown to more than 900 lawyers serving clients in 100 countries
from 18 offices around the world. While the firm's practice has a
strong industry focus on energy, financial services and life
sciences, the depth and breadth of its experience extends to more
than 100 separate practice areas, including bankruptcy and
creditors rights, commercial litigation, corporate transactions
and securities law, intellectual property, international and
government relations, regulatory law, products liability, and
privacy and information management.
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Total Share-
Total Working Holders'
Assets Capital Equity
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ ------- --------
ABRAXAS PETRO AXAS US 178.1 (5.2) (1.7)
ABSOLUTE SOFTWRE ABT CN 117.9 (12.8) (11.9)
ACCO BRANDS CORP ABD US 1,149.6 292.8 (79.8)
AEGERION PHARMAC AEGR US 2.9 (29.5) (27.3)
ALASKA COMM SYS ALSK US 620.6 1.4 (20.5)
AMER AXLE & MFG AXL US 2,114.7 33.0 (468.1)
AMERICAN STANDAR ASEN US 0.0 (0.1) (0.1)
AMR CORP AMR US 25,088.0 (1,942.0) (3,945.0)
ANACOR PHARMACEU ANAC US 20.4 (1.6) (8.2)
ARQULE INC ARQL US 94.1 45.1 (9.7)
ARVINMERITOR INC ARM US 2,814.0 357.0 (990.0)
AUTOZONE INC AZO US 5,640.5 (584.3) (817.2)
BLUEKNIGHT ENERG BKEP US 296.0 (427.8) (152.8)
BOARDWALK REAL E BOWFF US 2,326.8 - (109.0)
BOARDWALK REAL E BEI-U CN 2,326.8 - (109.0)
BOSTON PIZZA R-U BPF-U CN 112.0 2.0 (115.5)
CABLEVISION SY-A CVC US 8,840.7 (522.2) (6,280.7)
CAMPUS CREST COM CCG US 327.5 - (60.7)
CANADIAN SATEL-A XSR CN 188.3 (44.0) (6.1)
CC MEDIA-A CCMO US 17,479.9 1,504.6 (7,204.7)
CENTENNIAL COMM CYCL US 1,480.9 (52.1) (925.9)
CENVEO INC CVO US 1,393.6 220.0 (332.5)
CHENIERE ENERGY CQP US 1,797.0 30.3 (521.9)
CHENIERE ENERGY LNG US 2,616.5 (137.1) (431.0)
CHOICE HOTELS CHH US 411.7 (1.7) (58.1)
CLEVELAND BIOLAB CBLI US 11.9 (9.7) (10.0)
COLUMBIA LABORAT CBRX US 28.9 13.3 (12.1)
COMMERCIAL VEHIC CVGI US 286.2 116.1 (0.1)
CUMULUS MEDIA-A CMLS US 324.1 (2.5) (349.3)
DENNY'S CORP DENN US 311.2 (27.8) (103.7)
DISH NETWORK-A DISH US 9,632.2 74.1 (1,133.4)
DISH NETWORK-A EOT GR 9,632.2 74.1 (1,133.4)
DOMINO'S PIZZA DPZ US 425.7 104.1 (1,241.9)
DUN & BRADSTREET DNB US 1,727.3 (612.4) (717.4)
EASTMAN KODAK EK US 6,239.0 966.0 (1,075.0)
ENDOCYTE INC ECYT US 11.4 4.7 (2.6)
EPICEPT CORP EPCT SS 6.7 (1.1) (14.2)
EXELIXIS INC EXEL US 360.8 (16.5) (228.3)
FIRST SURGICAL P FSPI US - (0.0) (0.0)
FORD MOTOR CO F US 180,330.0 (18,558.0) (1,740.0)
FORD MOTOR CO F BB 180,330.0 (18,558.0) (1,740.0)
GENCORP INC GY US 991.5 71.4 (195.1)
GLG PARTNERS INC GLG US 400.0 156.9 (285.6)
GLG PARTNERS-UTS GLG/U US 400.0 156.9 (285.6)
GRAHAM PACKAGING GRM US 2,806.8 268.0 (530.7)
HICKS ACQUISITIO HKACU US 0.8 (0.8) (0.1)
HICKS ACQUISITIO HKAC US 0.8 (0.8) (0.1)
HOVNANIAN ENT-A HOV US 1,817.6 1,101.9 (337.9)
HOVNANIAN ENT-B HOVVB US 1,817.6 1,101.9 (337.9)
HUGHES TELEMATIC HUTC US 111.4 1.9 (42.1)
IDENIX PHARM IDIX US 63.1 24.0 (21.3)
INCYTE CORP INCY US 489.6 341.9 (88.6)
IPCS INC IPCS US 559.2 72.1 (33.0)
ISTA PHARMACEUTI ISTA US 134.2 15.8 (79.1)
JAZZ PHARMACEUTI JAZZ US 108.0 (13.3) (0.8)
JUST ENERGY GROU JE CN 1,760.9 (339.4) (328.6)
KNOLOGY INC KNOL US 787.7 20.4 (15.9)
KV PHARM-A KV/A US 358.6 (81.1) (139.1)
KV PHARM-B KV/B US 358.6 (81.1) (139.1)
LIGHTING SCIENCE LSCG US 60.0 28.3 (122.4)
LIN TV CORP-CL A TVL US 782.4 21.2 (146.9)
LIZ CLAIBORNE LIZ US 1,257.7 39.0 (21.7)
LORILLARD INC LO US 3,296.0 1,509.0 (225.0)
MAINSTREET EQUIT MEQ CN 448.9 - (9.0)
MANNKIND CORP MNKD US 277.3 55.8 (185.5)
MEAD JOHNSON MJN US 2,293.1 472.9 (358.3)
MOODY'S CORP MCO US 2,540.3 409.2 (309.7)
MORGANS HOTEL GR MHGC US 759.1 47.0 (42.1)
MPG OFFICE TRUST MPG US 3,267.4 - (897.2)
NATIONAL CINEMED NCMI US 854.5 77.3 (318.4)
NAVISTAR INTL NAV US 9,730.0 2,246.0 (924.0)
NEWCASTLE INVT C NCT US 3,760.1 - (591.2)
NEXSTAR BROADC-A NXST US 607.6 31.2 (189.9)
NORTH AMERICAN G NMGL US 0.0 (0.1) (0.1)
NPS PHARM INC NPSP US 228.9 133.8 (155.3)
NYMOX PHARMACEUT NYMX US 0.9 (1.0) (1.8)
OTELCO INC-IDS OTT US 322.1 22.0 (5.2)
OTELCO INC-IDS OTT-U CN 322.1 22.0 (5.2)
PALM INC PALM US 1,007.2 141.7 (6.2)
PDL BIOPHARMA IN PDLI US 257.5 26.1 (304.5)
PETROALGAE INC PALG US 5.9 (8.2) (51.6)
PLAYBOY ENTERP-A PLA/A US 165.8 (16.9) (54.4)
PLAYBOY ENTERP-B PLA US 165.8 (16.9) (54.4)
PRIMEDIA INC PRM US 215.5 (5.8) (97.8)
PRIMO WATER CORP PRMW US 29.0 (29.4) (9.6)
PROTECTION ONE PONE US 562.9 (7.6) (61.8)
QUALITY DISTRIBU QLTY US 284.3 26.9 (132.9)
QWEST COMMUNICAT Q US 17,220.0 (1,649.0) (1,655.0)
REGAL ENTERTAI-A RGC US 2,670.3 114.1 (267.3)
RENAISSANCE LEA RLRN US 53.8 (38.5) (35.1)
REVLON INC-A REV US 1,086.7 157.6 (696.4)
RIGNET INC RNET US 93.2 9.5 (11.6)
RSC HOLDINGS INC RRR US 2,718.0 (60.8) (37.3)
RURAL/METRO CORP RURL US 285.3 60.1 (98.6)
SALLY BEAUTY HOL SBH US 1,670.4 371.1 (406.1)
SINCLAIR BROAD-A SBGI US 1,485.9 36.4 (157.1)
SINCLAIR BROAD-A SBTA GR 1,485.9 36.4 (157.1)
SMART TECHNOL-A SMT US 559.1 201.9 (63.2)
SMART TECHNOL-A SMA CN 559.1 201.9 (63.2)
STEREOTAXIS INC STXS US 47.5 (6.2) (5.3)
SUN COMMUNITIES SUI US 1,162.7 - (132.4)
SWIFT TRANSPORTA SWFT US 2,577.9 237.4 (83.2)
SYNERGY PHARMACE SGYP US 2.7 (2.3) (1.8)
TAUBMAN CENTERS TCO US 2,546.9 - (527.9)
TEAM HEALTH HOLD TMH US 807.7 17.9 (51.4)
THERAVANCE THRX US 212.6 161.1 (141.1)
UNISYS CORP UIS US 3,020.9 538.7 (933.8)
UNITED RENTALS URI US 3,693.0 156.0 (20.0)
VECTOR GROUP LTD VGR US 949.6 299.9 (46.2)
VENOCO INC VQ US 750.9 (11.6) (84.2)
VIRGIN MOBILE-A VM US 307.4 (138.3) (244.2)
VISTEON CORP VC US 5,147.0 1,184.0 (737.0)
VONAGE HOLDINGS VG US 260.4 (67.7) (129.6)
WARNER MUSIC GRO WMG US 3,604.0 (602.0) (228.0)
WEIGHT WATCHERS WTW US 1,092.0 (348.7) (690.8)
WESTMORELAND COA WLB US 765.0 (51.3) (133.7)
WORLD COLOR PRES WC CN 2,641.5 479.2 (1,735.9)
WORLD COLOR PRES WCPSF US 2,641.5 479.2 (1,735.9)
WORLD COLOR PRES WC/U CN 2,641.5 479.2 (1,735.9)
WR GRACE & CO GRA US 4,271.7 1,371.3 (68.8)
*********
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. Jhonas Dampog, 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 2011. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
*** End of Transmission ***