/raid1/www/Hosts/bankrupt/TCR_Public/120207.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, February 7, 2012, Vol. 16, No. 37
Headlines
30DC INC: Posts $176,900 Net Loss in Sept. 30 Quarter
1000 CRESCENT: Guess? Founder's Company Sent to Chapter 11
155 EAST: Combined Plan Hearing Scheduled for March 2
155 EAST TROPICANA: Lender Hotel Offers $60MM Auction Bid
ACCENTIA BIOPHARMA: Laurus Master Fund Owns 3.45% of Common Shares
ACCENTIA BIOPHARMA: Sells 1,173,021 Shares to REF Holdings
ACCENTIA BIOPHARMA: Files Amendment No. 1 to Form S-1 Registration
ADELPHIA COMM: Bankruptcy Judges May Try Fraudulent Transfer Suits
ADVANCED LIFE: Meeting to Form Creditors' Panel on Feb. 21
AES EASTERN: NYSEG Seeks to Transfer Case to Syracuse
AES EASTERN: Taps Freed Maxick as Independent Auditors
AES EASTERN: Has Final Nod to Pay Critical Vendor Claims
AES EASTERN: Can Employ Weil Gotshal as Attorneys
AES EASTERN: Can Employ Richards Layton as Co-Counsel
AES EASTERN: Has Until Feb. 28 to File Schedules
AGE REFINING: Court Denies Panel's Plea for Confirmation New Trial
ALEXANDER GALLO: Liquidating Plan Set for Confirmation
ALLY FINANCIAL: Fitch Cuts Senior Unsecured Debt Rating to 'BB-'
AMERICAN AMEX: Case Summary & 3 Largest Unsecured Creditors
AMERICAN AXLE: Reports $30 Million Net Income in Fourth Quarter
AMERICAN INT'L: Fitch Lifts Rating on Sub. Debt Issues to 'BB'
AMERICAN PEGASUS: U.S. Court Recognizes Cayman Islands Proceeding
APEX HOMES: Case Summary & 20 Largest Unsecured Creditors
AQUILEX HOLDINGS: Completes Debt Swap, Centerbridge Takes Over
AQUILEX HOLDINGS: Suspending Filing of Reports with SEC
ARCADIA RESOURCES: Peter Brusca Resigns from Board of Directors
ATLANTIC & PACIFIC: Plan Confirmation Hearings Begin
AVANTAIR INC: Board of Directors Approves 2012 ALTIP
BCBG MAX: Moody's Downgrades CFR to Caa2; Outlook Negative
BGC PARTNERS: Moody's Changes Outlook on Ba1 Sr. Rating to Neg.
BEACON POWER: Assets to be Sold to Rockland Capital
BEACON POWER: Says Plan Remains Possible After Auction
BIOSCRIP INC: Moody's Says 'B3' CFR Unaffected by Asset Sale
BIOZONE PHARMACEUTICALS: Board Dismisses Daniel Fisher
BMF, INC.: Case Summary & 20 Largest Unsecured Creditors
BOOZ ALLEN: Moody's Says Recurring Dividend No Effect on Ba3 CFR
BOSQUE VERDE: Case Summary & 13 Largest Unsecured Creditors
BRIXMOR LLC: Fitch Upgrades Issuer Default Rating to 'BB-'
CAESARS ENTERTAINMENT: Bank Debt Trades at 14% Off
CAGLE'S INC: Seeks June 2012 Extension of Plan Exclusivity Period
CANO PETROLEUM: Reports $1.3 Million Net Income in Sept. 30 Qtr.
CELEBRITY CONTRACTORS: Case Summary & 3 Largest Unsec Creditors
CENTRAL FALLS: Governor Seeks $400K More for Receiver, Legal Fees
CENTRAL FEDERAL: Amends 30 Million Common Shares Offering
CHAMPION INDUSTRIES: Talks Restructuring Under Forbearance
CHRIST HOSPITAL: Files for Bankruptcy After Prime Axed Sale Deal
CLEAN HARBOR: Moody's Upgrades CFR to Ba2; Outlook Stable
CLEAR CHANNEL: Bank Debt Trades at 20% Off in Secondary Market
C.M. MEIER: To be Sold by Chapter 11 Trustee at Auction
CNO FINANCIAL: Fitch Lifts Rating on $293-Mil. Notes to 'B+'
COMPANIA SIDERUGICA: Moody's Says SWT Buyout No Impact on Rating
COMPREHENSIVE CARE: Clark Marcus Discloses 16.4% Equity Stake
CONVERTED ORGANICS: Terminates Agreement with Waste Systems
COPANO ENERGY: Moody's Rates $150-Mil. Sr. Note Offering at 'B1'
COSTA BONITA: Apartment Owner in Puerto Rico Files for Ch. 11
COUGAR OIL: Obtains CCAA Protection Until March 2
CYBERDEFENDER CORP: Hires XRoads as Restructuring Advisor
DELTA PETROLEUM: Notice Protocol for Equity Trading Gets Final OK
DEX MEDIA EAST: Bank Debt Trades at 53% Off in Secondary Market
DEX MEDIA WEST: Bank Debt Trades at 43% Off in Secondary Market
DEX ONE: Robert Mead Discloses 6.4% Equity Stake
DOWNEY REGIONAL: Hospital Wins Confirmation of Chapter 11 Plan
DRINKS AMERICAS: Patrick Kenny Discloses 20.1% Equity Stake
EAGLE POINT: Files for Chapter 11 Bankruptcy Protection
EAGLE POINT: Case Summary & 9 Largest Unsecured Creditors
ELEPHANT & CASTLE: Court Approves Sale to Original Joe's
HARRISBURG, PA: Appeal Dismissed for a Second Time
EMMIS COMMUNICATIONS: Zazove Holds 20.3% of Preferred Shares
EMMIS COMMUNICATIONS: DJD Group Owns 76,810 Preferred Shares
EMMIS COMMUNICATIONS: Kevan Fight Holds 2.2% of Preferred Shares
EMMIS COMMUNICATIONS: First Derivative Owns 5,500 Pref. Shares
EMPRESAS INTEREX: Hires Carrasquillo as Financial Consultant
EMPRESAS INTEREX: Files Schedules of Assets and Liabilities
ENER1 INC: Boris Zingrevich Files 14th Amendment to Schedule 13D
ENER1 INC: Judge Clears Firm to Tap $20 Million Bankruptcy Loan
ESPRIT: Closes 93 U.S. Stores After Failing to Find Buyer
EXPRESSWAY DEVELOPMENT: Court Orders Dismissal of Bankruptcy Case
FCC HOLDINGS: Moody's Reviews 'Caa1' CFR for Possible Downgrade
FERRETERIA Y AGROCENTRO: Case Summary & Largest Unsec. Creditors
GAME TRADING: Files for Chapter 11 Bankruptcy Protection
GARDEN CITY: Moody's Affirms 'Ba3' Long Term Bond Rating
GENCORP INC: Franklin Mutual Discloses 5.4% Equity Stake
GENERAL MARITIME: Files Plan and Related Disclosure Statement
GENEVA STEEL: Ex-Kaye Scholer Atty Pleads Guilty But Dodges Jail
GLOBAL AVIATION: World Airways Files for Chapter 11
GLOBAL AVIATION: Case Summary & 30 Largest Unsecured Creditors
HARRISBURG, PA: Bankruptcy Appeal Came Too Late, Judge Says
HAWKER BEECHCRAFT: Bank Debt Trades at 22% Off
HAWKER BEECHCRAFT: Bank Debt Trades at 21% Off
HERON LAKE: Boulay Heutmaker Raises Going Concern Doubt
INDYMAC BANCORP: Judge Blasts Paul Hastings Lawyer Over Pleading
INTEGRATED BIOPHARMA: Extends Imperium Forbearance Until Feb. 7
INTELLICELL BIOSCIENCES: Sells $790,000 Series D Preferred Shares
INVESTORS LENDING: Court Okays Weiner as Special Attorney
INVESTORS LENDING: Wants to Renew Existing Loan With UCB
JENNE HILL: Court to Consider Cash Collateral Motion on Feb. 16
JENNE HILL: Files Schedules of Assets and Liabilities
JOBSON MEDICAL: Plan Deal Requires Ch. 11 Exit in March
KEOKUK HOSPITAL: Moody's Downgrades Bond Rating to 'Caa3'
KODIAK ENERGY: Majority Owned Subsidiary Files for CCCA Protection
LE-NATURE'S INC: Judge Rejects Bids to Stop $500M Clawback Suit
LEE ENTERPRISES: KPMG Removes Going Concern Doubt in FY2011 Report
LEVEL 3: Thornburg Investment Discloses 3.8% Equity Stake
LIBERATOR INC: To Be Featured on Steve Crowley's Radio Program
LICHTIN/WADE LLC: Files for Chapter 11 in Wilson, NC
LIMITED BRANDS: Moody's Rates Proposed $750-Mil. Notes at 'Ba1'
LIMITED BRANDS: Moody's Says Ba1 CFR Unaffected by Note Increase
LIMITED BRANDS: Fitch Assigns 'BB+' Rating to $750-Mil. Notes
LOCAL TV: Moody's Assigns 'B1' Rating to Proposed $15-Mil. Notes
LONE STAR: Case Summary & 20 Largest Unsecured Creditors
LOS ANGELES DODGERS: Korean Retailer Part of Bidding Group
M WAIKIKI: Gets OK to Obtain $550,000 from Davidson Family Trust
MARK TIPTON: ECU Trustee Files for Chapter 11 Bankruptcy
MARSICO HOLDINGS: Bank Debt Trades at 62% Off in Secondary Market
MEECHAM HOSPITALITY: Fossil Creek Hotel in Chapter 11
MONEY TREE: Court Approves Barker Donelson as Chapter 11 Counsel
MONEYGRAM INT'L: Posts $3.1 Million Net Income in Fourth Quarter
MONEYGRAM INT'L: May Face Criminal Penalties for Alleged Fraud
MORGAN & FINNEGAN: Judge Allow Clawback Suit Against Ex-Attys
MORRIER RANCH: Banks Sue for $6 Million in Unpaid Debts
MORTGAGE FUND '08: Court Confirms Chapter 11 Plan
NEWBURGH CITY: Moody's Affirms 'Ba1' General Obligations Rating
NEWPAGE CORP: Ciardi Ciardi OK'd to Handle Panel's Experts Hiring
NEXT 1 INTERACTIVE: Amends P-Notes with Don Monaco Affiliates
NORTEL NETWORKS: Wants to Facilitate Wind-Down of NN Japan
NORTH FOREST: Moody's Affirms 'Ba3' Gen. Obligation Debt Rating
OCEAN PLACE: U.S. Trustee Wants Plan Confirmation Denied
OPEN RANGE: Hoping to Sue Federal Government Agencies
OPEN RANGE: Anton Collins OK'd to Assist in 2011, 2012 Tax Returns
OSCEOLA MEDICAL: May Be Dismissed on 'Bad Faith' Filing
OVERLAND STORAGE: Pinnacle Family Discloses 7.9% Equity Stake
PALISADES 6300: Plan Outline Hearing Scheduled for Tomorrow
PENN TREATY: Deltec Asset Owns 250 Common Shares
PERPETUAL ENERGY: Moody's Lowers CFR to Caa1; Outlook Negative
PROTEONOMIX INC: Employs Jaci Mandil as Chief Executive Officer
QUEEN CITY: TV Retailer Files for Chapter 11 Bankruptcy
QUEEN CITY: Voluntary Chapter 11 Case Summary
RAY ANTHONY: Court to Consider Deal on Case Dismissal Opposition
REDDY ICE: Robert Mead Discloses 6.9% Equity Stake
REPUBLIC MORTGAGE: Moody's Withdraws 'Caa2' IFSR
ROCK POINT: DMARC 2006 Wants $292,000 Adequate Protection Payment
ROCKWOOD SPECIALTIES: Moody's Rates Tranche A Loan at 'Ba1'
RYAN'S RESTAURANT: Bankruptcy Stays Gloria Anderson Lawsuit
SABINE PASS: Moody's Reviews 'B3' Rating for Possible Upgrade
SHASTA LAKE: Stipulation for Cash Use Until March 31 Approved
SLAVERY MUSEUM: Wants More Time to File Delinquent Tax Returns
SNEAKERS JAX: Case Summary & 10 Largest Unsecured Creditors
SOLAR DRIVE: Court Dismisses Chapter 11 Case
SOLYNDRA LLC: Ex-Employees Question Sale, 3rd Party Releases
SOUTHERN OAKS: Case Summary & 17 Largest Unsecured Creditors
SP NEWSPRINT: Unsecured Creditors Take Aim at Sale Process
ST. JOSEPH HEALTH: Moody's Lowers Long-Term Rating to 'Caa2'
STARWOOD HOTELS: Fitch Upgrades Issuer Default Rating From 'BB+'
STOCKDALE TOWER: Files Schedules of Assets and Liabilities
SUMMIT NORTHSTAR: Voluntary Chapter 11 Case Summary
SUNOCO INC: Moody's Says 'Ba1' CFR Unaffected by Marketing Plans
SUNOCO INC: Says Stock Buyback Won't Affect Fitch's 'BB+' IDR
TECHNEST HOLDINGS: Amends Form S-1 Registration Statement
TEXAS MEI: Case Summary & 20 Largest Unsecured Creditors
THORPE INSULATION: 9th Cir. Affirms Ruling Against Insurer
THUNDER ALLEY: Case Summary & 17 Largest Unsecured Creditors
TRAIL INN: Case Summary & 4 Largest Unsecured Creditors
TRAVELPORT INC: Bank Debt Trades at 16% Off in Secondary Market
TRAVELPORT INC: Bank Debt Trades at 13% Off in Secondary Market
TRIBUNE CO: Bank Debt Trades at 35% Off in Secondary Market
TRONOX INC: Moody's Says Ba3 CFR Unaffected by Loan Upsize Plan
TXU CORP: Bank Debt Trades at 39% Off in Secondary Market
TXU CORP: Bank Debt Trades at 33% Off in Secondary Market
UNITED GILSONITE: Court Extends Plan Filing Deadline to July 16
UNITED RETAIL: Meeting to Form Creditors' Panel on Feb. 9
UNITED RETAIL: Receives Interim Nod of $25MM Loan
USG CORP: Borrowings Under TD Bank Loan Hiked to C$40 Million
VITRO SAB: Court Orders Conversion of VAC Cases to Chapter 7
VIVAKOR INC: Suspending Filing of Reports with SEC
WASHINGTON MUTUAL: Warrant, Share Holders Want Plan Outline Denied
WDS LLC: Voluntary Chapter 11 Case Summary
WEST END: Court Confirms Third Amended Plan of Liquidation
WESTLAND CITY: Moody's Raises Revenue Debt Rating From 'Ba1'
WOODBURY DEVELOPMENT: Case Summary & 6 Largest Unsecured Creditors
ZOGENIX INC: To Sell $75 Million of Securities
ZOO ENTERTAINMENT: MMB to Provide Additional $175,000 Financing
ZOO ENTERTAINMENT: David Smith Discloses 26.5% Equity Stake
* Lack of Original Mortgage Note Defeats Foreclosure
* Circuit Lays Down Rules to Avoid Arbitration Clauses
* Court to IRS: Wrong Defendant for Sovereign Immunity
* Control More Important Than Ownership for Fraud Suit
* Bankruptcy Court Jury Trial May Violate Seventh Amendment
* New York District Court Rules to Clarify Bankruptcy Judges' Role
* Geithner: Goal Of Dodd-Frank Isn't to Eliminate Failure
* Cecelia Morris Is New Chief New York Bankruptcy Judge
* Banks Push for More Transparency in Credit Default Swaps
* Without Timber Money, Oregon Budgets Face Buzzsaw
* Edwards Wildman Adds Bankruptcy Partner to NY Office
* CME Group to Rebuild Farmers' Trust With $100MM Insurance Fund
* Large Companies With Insolvent Balance Sheets
*********
30DC INC: Posts $176,900 Net Loss in Sept. 30 Quarter
-----------------------------------------------------
30DC, Inc., formerly known as Infinity Capital Group, Inc., filed
its quarterly report on Form 10-Q, reporting a net loss of
$176,941 on $415,258 of revenues for the three months ended
Sept. 30, 2011, compared with a net loss of $1.0 million on
$402,202 of revenues for the same period of 2010.
The Company's balance sheet at Sept. 30, 2011, showed $1.9 million
in total assets, $2.1 million in total liabilities, all current,
and a stockholders' deficit of $233,299.
As reported in the TCR on Dec. 19, 2011, Marcum LLP, in New York,
expressed substantial doubt about 30DC's ability to continue as a
going concern, following the Company's results for the fiscal year
ended June 30, 2011. The independent auditors noted that the
Company has had recurring losses, and has a working capital and
stockholders' deficiency as of June 30, 2011.
A copy of the Form 10-Q is available for free at:
http://is.gd/Vf8xnL
New York-based 30DC, Inc., provides Internet marketing services
and related training to help Internet companies in operating their
businesses. It operates in two divisions, 30 Day Challenge and
Immediate Edge.
1000 CRESCENT: Guess? Founder's Company Sent to Chapter 11
----------------------------------------------------------
1000 Crescent LLC filed a bare-bones Chapter 11 petition (Bankr.
C.D. Calif. Case No. 12-bk-11056) on Feb. 2, 2012. The Debtor
estimated assets of up to $10 million and liabilities of only up
to $50,000.
Pacific Bluewood LLC, as sole member of the Company, signed a
document removing all incumbent members of the Company and
designating David J. Gottlieb of Crowe Horwath LLP as manager.
Mr. Gottlieb signed the Chapter 11 petition. Lawyers from
Pachulski Stang Ziehl & Jones LLP represent the Debtor as counsel.
Court filings indicate that the Debtor is affiliated with Georges
Marciano.
Georges Marciano is the co-founder of the apparel company Guess?
Inc. and an investor in various companies and real estate
ventures. Three of the five former employees of Mr. Marciano,
who won a $370 million libel judgment against him in July 2009,
filed an involuntary chapter 11 bankruptcy petition (Bankr. C.D.
Calif. Case No. 09-39630) against the Guess? Inc. co-founder on
Oct. 27 2009. Mr. Marciano challenged the involuntary petition
for 14 months, and Judge Victoria S. Kaufman entered an order for
relief against Mr. Marciano on Dec. 29, 2010. Mr. Gottlieb was
appointed as trustee in Mr. Marciano's involuntary bankruptcy.
155 EAST: Combined Plan Hearing Scheduled for March 2
-----------------------------------------------------
The Hon. Bruce A. Markell of the U.S. Bankruptcy Court for the
District of Nevada will convene a hearing on March 2, 2012, at
1:00 p.m. (Pacific Time), to consider the adequacy of the
Disclosure Statement and the confirmation of 155 East Tropicana,
LLC, and 155 East Tropicana Finance Corp.'s First Amended Joint
Plan of Reorganization.
The Court also ordered that objections, if any, are due Feb. 17,
2012. The deadline for filing replies to any objections is
Feb. 24. Ballots accepting or rejecting the Plan are due Feb. 24,
at 4:00 p.m. (Eastern Time). Ballots must be submitted to this
address:
The Garden City Group, Inc.
Attn: 155 East Tropicana Balloting Agent
P.O. Box 9801
Dublin, OH 43017-5701
Tel: (631) 470-5000 (Emily Young or Michael Olney)
The deadline for the Debtors to file a ballot tabulation is
Feb. 29.
According to the Disclosure Statement filed Jan. 11, 2012, the
primary objective of the reorganization and restructuring under
the Plan is to maximize returns to those creditors entitled to
recoveries from the estates. The Debtors desire to achieve this
objective through:
(i) an expeditious sale of the encumbered assets of the
Company, comprised mainly of the Casino/Hotel the assumption
of certain liabilities as part of the sale, and the assumption
and assignment of specific executory contracts and leases
pursuant to 11 U.S.C. Section 365, or
(ii) a credit bid by U.S. Bank, N.A. as the successor Indenture
Trustee or its designee, successor or assignee under the 8-3/4%
Senior Secured Notes Indenture with regard to the collateral
under the Senior Secured Loan Documents Neither alternative
will include cash and cash equivalents which will be used to
satisfy Allowed Administrative Expenses, Allowed Priority Tax
Claims, Allowed Priority Claims, Allowed General Unsecured
Claims, the Allowed Claims of the Holders of Senior Secured
Notes but for those Senior Secured Notes held by Canpartners
Realty Holding Company IV LLC, a Delaware limited liability
company and wind down expenses of the Reorganized Debtor
related to the Casino Hotel business.
During the course of the Debtors' Chapter 11 Cases, the Debtors
have sought a combination of capital raising transaction or merger
and acquisition transactions, including the sale in one
transaction of substantially all of the assets of that certain
hotel and casino commonly known as Hooters Casino Hotel located in
Las Vegas, Nevada as a going concern to a third-party buyer. The
Debtors, in conjunction with its Bankruptcy Court appointed
financial advisor, Innovation Capital, LLC has marketed the Casino
Hotel.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/155_EAST_ds_1stamended.pdf
About 155 East Tropicana
155 East Tropicana LLC owns the world's first Hooters Casino
Hotel, a 696-room and 4-suite hotel located one block from the Las
Vegas Strip and across Tropicana Blvd. from MGM Grand.
155 East Tropicana, along with an affiliate, sought Chapter 11
protection (Bankr. D. Nev. Case No. 11-22216) on Aug. 1, 2011.
155 East sought bankruptcy protection to stop a scheduled Aug. 8
foreclosure of the second-lien debt. The two secured credit
facilities were accelerated early this year.
Canpartners Realty Holding Co. IV LLC acquired 98.4% of the
$130 million in 8.75% second-lien senior secured notes. An
additional $32.2 million of interest is owing on the second-lien
debt, with US Bank NA as the indenture trustee. Holders of the
$14.5 million in first-lien debt have Wells Fargo Capital Finance
Inc. as their agent. The first-lien obligation is fully secured.
Interest has been paid at the default rate.
Gerald M. Gordon, Esq., and Brigid M. Higgins, Esq., at Gordon
Silver, in Las Vegas, Nevada, serve as counsel to the Debtors.
Garden City Group, Inc., is the claims agent. William G. Kimmel &
Associates has been hired to provide an appraisal of the Debtors'
casino hotel/property. Alvarez & Marsal serves as financial and
restructuring advisor. Innovation Capital LLC serves as financial
advisor for capital raising transactions and M&A transactions.
155 EAST TROPICANA: Lender Hotel Offers $60MM Auction Bid
---------------------------------------------------------
Dow Jones' DBR Small Cap reports that the biggest lender behind
the Hooters Casino Hotel offered $60 million for the financially
struggling attraction located just off the Las Vegas Strip.
And at an upcoming bankruptcy auction, the casino's owner will see
if anyone wants to raise, according to Dow Jones' DBR Small Cap.
About 155 East Tropicana
155 East Tropicana LLC owns the world's first Hooters Casino
Hotel, a 696-room and 4-suite hotel located one block from the Las
Vegas Strip and across Tropicana Blvd. from MGM Grand.
155 East Tropicana, along with an affiliate, sought Chapter 11
protection (Bankr. D. Nev. Case No. 11-22216) on Aug. 1, 2011.
155 East sought bankruptcy protection to stop a scheduled Aug. 8
foreclosure of the second-lien debt. The two secured credit
facilities were accelerated early this year.
Canpartners Realty Holding Co. IV LLC acquired 98.4% of the
$130 million in 8.75% second-lien senior secured notes. An
additional $32.2 million of interest is owing on the second-lien
debt, with US Bank NA as the indenture trustee. Holders of the
$14.5 million in first-lien debt have Wells Fargo Capital Finance
Inc. as their agent. The first-lien obligation is fully secured.
Interest has been paid at the default rate.
Gerald M. Gordon, Esq., and Brigid M. Higgins, Esq., at Gordon
Silver, in Las Vegas, Nevada, serve as counsel to the Debtors.
Garden City Group, Inc., is the claims agent. William G. Kimmel &
Associates has been hired to provide an appraisal of the Debtors'
casino hotel/property. Alvarez & Marsal serves as financial and
restructuring advisor. Innovation Capital LLC serves as financial
advisor for capital raising transactions and M&A transactions.
ACCENTIA BIOPHARMA: Laurus Master Fund Owns 3.45% of Common Shares
------------------------------------------------------------------
Laurus Master Fund Ltd. (In Liquidation), Valens Offshore SPV I,
Ltd., Laurus Capital Management, LLC, Valens Offshore SPV II,
Corp., Valens U.S. SPV I, LLC, Valens Capital Management, LLC,
Christopher D. Johnson, Russell Smith, David Grin, and Eugene Grin
disclose that as of Dec. 31, 2011, that they may beneficially own
$2,598,133 shares of common stock, par value $0.001 per share, of
Accentia Biopharmaceuticals, Inc., representing 3.45% of the
Company's issued and outstanding shares of commmon stock as of
Dec. 15, 2011, as disclosed in the Company's annual report on Form
10-K for the fiscal year ended Dec. 31, 2011.
A copy of the SC13G/A is available for free at http://is.gd/kwBg77
About Accentia Biopharmaceuticals
Headquartered in Tampa, Florida, Accentia Biopharmaceuticals, Inc.
(OTC QB: "ABPI") -- http://www.Accentia.net/-- is committed to
advancing the autoimmune disease therapy, Revimmune(TM), as a
comprehensive system of care and drug regimen designed for the
treatment of autoimmune diseases. Revimmune therapy includes an
ultra-high-dose regimen of Cytoxan(R) (cyclophosphamide),
exclusively supplied via a strategic agreement with Baxter
Healthcare Corporation. Clinical trials for Revimmune are being
planned for the treatment of multiple autoimmune indications.
Accentia holds a majority-ownership stake in Biovest
International, Inc. (OTC QB: "BVTI"), an emerging leader in the
field of active personalized immunotherapies. In collaboration
with the National Cancer Institute, Biovest has developed a
patient-specific cancer vaccine, BiovaxID(R), with three clinical
trials completed, including a Phase III study for the treatment of
follicular non-Hodgkin's lymphoma.
On Nov. 10, 2008, the Company and its wholly-owned subsidiaries,
Analytica, TEAMM Pharmaceuticals, Inc. d/b/a Accentia
Pharmaceuticals, AccentRx, Inc., and Accentia Specialty Pharmacy
filed voluntary petitions for reorganization under Chapter 11 of
the United States Bankruptcy Code in the U.S. Bankruptcy Court for
the Middle District of Florida, Tampa Division.
On Nov. 2, 2010, the Bankruptcy Court entered an order confirming
the Debtors' Joint Plan of Reorganization. The Company emerged
from Chapter 11 protection, and the Plan became effective, on
Nov. 17, 2010.
ACCENTIA BIOPHARMA: Sells 1,173,021 Shares to REF Holdings
----------------------------------------------------------
On Jan. 27, 2012, Accentia Biopharmaceuticals, Inc., sold
1,173,021 units, with each unit consisting of one share of the
Company's common stock, par value $0.001 per share, and a warrant
to purchase one-half of one share of the Company's common stock,
to REF Holdings, LLC, for an aggregate purchase price of $400,000
(or $0.341 per Unit). This sale was made pursuant to a
Subscription Agreement, dated Jan. 27, 2012, between the Company
and the Investor.
Under the terms of the Subscription Agreement, the Company has
agreed to use its best efforts to file, within 30 calendar days
following the closing of the purchase, a resale registration
statement covering the shares of common stock underlying the Units
and the shares of common stock issuable upon exercise of the
warrants underlying the Units.
The exercise of the warrants underlying the Units is governed by
the terms and conditions set forth in the Common Stock Purchase
Warrant issued by the Company to the Investor on Jan. 27, 2012.
The Warrant gives the Investor the right to purchase up to 586,511
shares of the Company's common stock at an exercise price of $0.40
per share (subject to adjustment for stock splits, stock
dividends, certain other distributions, and the like). The
Warrant is immediately exercisable and will expire on Jan. 27,
2017.
A copy of the Subscription Agreement, dated Jan. 27, 2012, is
available for free at http://is.gd/FX5btZ
A copy of the Common Stock Purchase Warrant, dated Jan. 27, 2012,
is available for free at http://is.gd/U3PVuV
About Accentia Biopharmaceuticals
Headquartered in Tampa, Florida, Accentia Biopharmaceuticals, Inc.
(OTC QB: "ABPI") -- http://www.Accentia.net/-- is committed to
advancing the autoimmune disease therapy, Revimmune(TM), as a
comprehensive system of care and drug regimen designed for the
treatment of autoimmune diseases. Revimmune therapy includes an
ultra-high-dose regimen of Cytoxan(R) (cyclophosphamide),
exclusively supplied via a strategic agreement with Baxter
Healthcare Corporation. Clinical trials for Revimmune are being
planned for the treatment of multiple autoimmune indications.
Accentia holds a majority-ownership stake in Biovest
International, Inc. (OTC QB: "BVTI"), an emerging leader in the
field of active personalized immunotherapies. In collaboration
with the National Cancer Institute, Biovest has developed a
patient-specific cancer vaccine, BiovaxID(R), with three clinical
trials completed, including a Phase III study for the treatment of
follicular non-Hodgkin's lymphoma.
On Nov. 10, 2008, the Company and its wholly-owned subsidiaries,
Analytica, TEAMM Pharmaceuticals, Inc. d/b/a Accentia
Pharmaceuticals, AccentRx, Inc., and Accentia Specialty Pharmacy
filed voluntary petitions for reorganization under Chapter 11 of
the United States Bankruptcy Code in the U.S. Bankruptcy Court for
the Middle District of Florida, Tampa Division.
On Nov. 2, 2010, the Bankruptcy Court entered an order confirming
the Debtors' Joint Plan of Reorganization. The Company emerged
from Chapter 11 protection, and the Plan became effective, on
Nov. 17, 2010.
* * *
As reported in the TCR on Dec. 22, 2011, Cherry, Bekaert &
Holland, L.L.P., in Tampa, Fla., expressed substantial doubt about
Accentia Biopharmaceuticals' ability to continue as a going
concern, following the Company's results for the fiscal year ended
Sept. 30, 2011. The independent auditors noted that the Company
incurred cumulative net losses of approximately $63.9 million
during the two years ended Sept. 30, 2011, and had a working
capital deficiency of approximately $29.0 million at Sept. 30,
2011.
ACCENTIA BIOPHARMA: Files Amendment No. 1 to Form S-1 Registration
------------------------------------------------------------------
On Feb. 3, 2012, Accentia Biopharmaceuticals Inc., filed with the
Securities Exchange Commission Amendment No. 1 to its Form S-1
Registration Statement with respect to the Registrant's offering
of _______ units, each consisting of one share of Common Stock,
par value $0.001 per share, and a Warrant to purchase 0.5 shares
of Common Stock.
The information in the prospectus is not complete and may be
changed. The Company may not sell these securities until the
registration statement filed with the Securities and Exchange
Commission is effective. The prospectus is not an offer to sell
these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
A copy of the Form S-1/A is available for free at:
http://is.gd/aMS26C
About Accentia Biopharmaceuticals
Headquartered in Tampa, Florida, Accentia Biopharmaceuticals, Inc.
(OTC QB: "ABPI") -- http://www.Accentia.net/-- is committed to
advancing the autoimmune disease therapy, Revimmune(TM), as a
comprehensive system of care and drug regimen designed for the
treatment of autoimmune diseases. Revimmune therapy includes an
ultra-high-dose regimen of Cytoxan(R) (cyclophosphamide),
exclusively supplied via a strategic agreement with Baxter
Healthcare Corporation. Clinical trials for Revimmune are being
planned for the treatment of multiple autoimmune indications.
Accentia holds a majority-ownership stake in Biovest
International, Inc. (OTC QB: "BVTI"), an emerging leader in the
field of active personalized immunotherapies. In collaboration
with the National Cancer Institute, Biovest has developed a
patient-specific cancer vaccine, BiovaxID(R), with three clinical
trials completed, including a Phase III study for the treatment of
follicular non-Hodgkin's lymphoma.
On Nov. 10, 2008, the Company and its wholly-owned subsidiaries,
Analytica, TEAMM Pharmaceuticals, Inc. d/b/a Accentia
Pharmaceuticals, AccentRx, Inc., and Accentia Specialty Pharmacy
filed voluntary petitions for reorganization under Chapter 11 of
the United States Bankruptcy Code in the U.S. Bankruptcy Court for
the Middle District of Florida, Tampa Division.
On Nov. 2, 2010, the Bankruptcy Court entered an order confirming
the Debtors' Joint Plan of Reorganization. The Company emerged
from Chapter 11 protection, and the Plan became effective, on
Nov. 17, 2010.
* * *
As reported in the TCR on Dec. 22, 2011, Cherry, Bekaert &
Holland, L.L.P., in Tampa, Fla., expressed substantial doubt about
Accentia Biopharmaceuticals' ability to continue as a going
concern, following the Company's results for the fiscal year ended
Sept. 30, 2011. The independent auditors noted that the Company
incurred cumulative net losses of approximately $63.9 million
during the two years ended Sept. 30, 2011, and had a working
capital deficiency of approximately $29.0 million at Sept. 30,
2011.
ADELPHIA COMM: Bankruptcy Judges May Try Fraudulent Transfer Suits
------------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that federal district courts in New York and San Francisco
are in agreement that bankruptcy judges can continue holding
trials in fraudulent transfer suits, although they may only write
proposed findings of fact and conclusions of law to be reviewed
by district judges who aren't bound by the bankruptcy judges'
findings of fact.
The report relates that the New York case rose in the aftermath of
the liquidation of Adelphia Communications Corp. where the trust
created for creditors under the confirmed Chapter 11 plan filed a
fraudulent transfer suit against a creditor that had filed a proof
of claim. After the U.S. Supreme Court decided a case in June
called Stern v. Marshall, a defendant argued that the suit had to
be taken out of bankruptcy court. The Stern opinion said
bankruptcy courts lack constitutional power to make final rulings
on some types of state law claims.
According to the report, U.S. District Judge Paul A. Crotty in New
York agreed with the defendant that a fraudulent transfer suit
involves a private right under the Supreme Court's decision in
Granfinanciera v. Nordberg. Consequently, Judge Crotty said in
his Jan. 30 opinion that the bankruptcy judge doesn't have
constitutional authority to issue a final judgment even though the
suit is considered "core."
Judge Crotty next ruled, like his San Francisco counterpart in
Heller Ehrman LLP v. Arnold & Porter LLP, that the suit
nonetheless should be tried in bankruptcy court. To interpret
Stern v. Marshall as removing fraudulent transfer suits from the
bankruptcy court's jurisdiction, Judge Crotty said, would
"meaningfully change the division of labor between bankruptcy and
district courts." Judge Crotty also relied on a newly adopted
local rule where the district judges in New York said that
bankruptcy judges may issue recommended findings and conclusions
on disputes that fall within Stern v. Marshall when they are part
of the bankruptcy court's "core" jurisdiction.
About Adelphia Communications
Based in Coudersport, Pennsylvania, Adelphia Communications
Corporation was once the fifth-biggest cable company. Adelphia
served customers in 30 states and Puerto Rico, and offered analog
and digital video services, Internet access and other advanced
services over its broadband networks.
Adelphia collapsed in 2002 after disclosing that founder John
Rigas and his family owed $2.3 billion in off-balance-sheet debt
on bank loans taken jointly with the company. Mr. Rigas is
serving 12 years in prison, and his son Timothy is serving 15
years.
Adelphia Communications and its more than 200 affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 02-41729) on
June 25, 2002. Willkie Farr & Gallagher represented the Debtors
in their restructuring effort. PricewaterhouseCoopers served as
the Debtors' financial advisor. Kasowitz, Benson, Torres &
Friedman LLP and Klee, Tuchin, Bogdanoff & Stern LLP represented
the Official Committee of Unsecured Creditors.
Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas-Managed Entities, were
entities that were previously held or controlled by members of the
Rigas family. In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision LLC. The RME Debtors filed for Chapter 11 protection
(Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642) on March 31,
2006. Their cases were jointly administered under Adelphia
Communications and its debtor-affiliates' Chapter 11 cases.
The Bankruptcy Court confirmed the Debtors' Joint Chapter 11 Plan
of Reorganization on Jan. 5, 2007. That plan became effective on
Feb. 13, 2007.
The Adelphia Recovery Trust, a Delaware Statutory Trust, was
formed pursuant to the Plan. The Trust holds certain litigation
claims transferred pursuant to the Plan against various third
parties and exists to prosecute the causes of action transferred
to it for the benefit of holders of Trust interests. Lawyers at
Kasowitz, Benson, Torres & Friedman, LLP (NYC), represent the
Adelphia Recovery Trust.
ADVANCED LIFE: Meeting to Form Creditors' Panel on Feb. 21
----------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on Feb. 21, 2012, at 9:30 a.m. in
the bankruptcy case of Advanced Life Support Ambulance, Inc., &
Art of Life, Inc. The meeting will be held at:
Office of the United States Trustee
833 Chestnut Street, Suite 501
Philadelphia, PA 19107
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
Advanced Life Support Ambulance, Inc., filed for Chapter 11
bankruptcy (Bankr. E.D. Pa. Case No. 12-10597) on Jan. 24, 2012,
estimating under $500,000 in assets and debts under $1 million.
Robert Neil Braverman, Esq., at the Law Office of Robert
Braverman, LLC, serves as counsel. See
http://bankrupt.com/misc/paeb12-10597.pdf
AES EASTERN: NYSEG Seeks to Transfer Case to Syracuse
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the bankruptcy reorganization of AES Eastern Energy
LP and its six power plants should be transferred from Delaware to
New York, if New York State Electric & Gas Corp. prevails on a
motion filed last week. NYSEG wants the Chapter 11 case
transferred to Syracuse, New York, given that all six plants and
most of the creditors are in New York.
Mr. Rochelle recounts that AES acquired the plants from NYSEG in a
$950 million sale and lease-back transaction in 1998. The six
plants are all in western New York, and only two are now
operating. NYSEG says it will have claims governed by New York
law arising from environmental liabilities at the plants.
According to the report, as grounds for moving the case out of
Delaware, NYSEG points out how the plants sell power into the
state's wholesale distribution system. The 191 workers are all
located in New York, NYSEG says. The plants are regulated by New
York state and the contemplated sale will require the regulators'
approval. In addition, the banks and indenture trustees that make
up the bulk of the creditors are all located in New York, the
motion asserts. The papers point out that none of the 40 largest
creditors are in Delaware.
NYSEG says the companies' only connection with Delaware is from
their creation under that state's law. The hearing on the so-
called venue transfer motion is set for Feb. 15.
Rochester, New York-based NYSEG is a transmission and distribution
utility with more than 860,000 electric customers and 250,000
natural gas customers in New York.
About AES Eastern Energy
Ithaca, New York-based AES Eastern Energy, L.P. operates four
coal-fired electricity generating facilities with a gross capacity
of 1,169 MW. AEE leases two of those plants. AEE sells
electricity into the spot market at prevailing New York
Independent System Operator wholesale market prices. AEE is a
special purpose entity that is indirectly wholly owned by AES
Corp.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A. are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
The Chapter 11 filing was designed to turn the two operating
facilities over to debt holders in exchange for debt.
AES EASTERN: Taps Freed Maxick as Independent Auditors
------------------------------------------------------
AES Eastern Energy, L.P, et al., ask the U.S. Bankruptcy Court for
the District of Delaware for authorization to employ Freed Maxick
CPAs, P.C., nunc pro tunc to Jan. 31, 2012, (1) as independent
auditors to the Debtors, and (ii) to complete a limited scope
audit of the Retirement Benefit Plan for the Employees of AES NY,
L.L.C.
J. Michael Ervin, a director of the firm, attests that Freed
Maxick is a "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code, as modified by Section
1107(b) of the Bankruptcy Code.
Freed Maxick will charge based on these hourly rates:
Industry Specialist $425
Director $395
Senior Manager $190-$305
Manager $150-$170
Senior Accountant $100-$149
Staff Accountant $90-$100
Administrative $75
In addition, the Debtors agree to reimburse Freed Maxick for its
reasonable out-of-pocket expenses incurred in connection with its
provisions of services.
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six Power Plants and sell the electricity
generated by those Power Plants, as well as unforced capacity and
ancillary services, into the New York wholesale power market to
utilities and other intermediaries under short-term agreements or
directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., are the proposed counsel to the Creditors'
Committee.
AES EASTERN: Has Final Nod to Pay Critical Vendor Claims
--------------------------------------------------------
On Jan. 26, 2012, the U.S. Bankruptcy Court for the District of
Delaware entered a final order authorizing AES Eastern Energy,
L.P., et al., to pay, in an aggregate not to exceed $450,000, some
of all or all of the undisputed prepetition claims of Critical
Vendors who agree to continue to supply goods to the Debtors on
that Critical Vendor's customary trade terms until the earlier of
six months after the Petition Date or the completion of the
Debtors' Chapter 11 case and on those other terms and conditions
are are acceptable to the Debtors.
In addition, the Debtors are authorized, but not directed, in the
reasonable exercise of their business judgment, to pay, in an
aggregate amount not to exceed $300,000, some or all of the
undisputed prepetition claims of Potential Lien Claimants.
As reported in the TCR on Jan. 27, 2012, AES Eastern Energy, L.P.,
and its affiliates obtained interim Court approval of its request
to pay prepetition obligations to critical vendors. The Debtors
are authorized to pay up to (1) $300,000 on an interim basis to
vendors who agree to continue to supply goods on customary trade
terms in the next six months and (2) $130,000 for some or all of
the undisputed prepetition claims of potential lien claimants.
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six Power Plants and sell the electricity
generated by those Power Plants, as well as unforced capacity and
ancillary services, into the New York wholesale power market to
utilities and other intermediaries under short-term agreements or
directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., are the proposed counsel to the Creditors'
Committee.
AES EASTERN: Can Employ Weil Gotshal as Attorneys
-------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has granted
AES Eastern Energy, L.P., et al., permission to employ Weil,
Gotshal & Manges as attorneys for the Debtors, nunc pro tunc to
the Petition Date.
The Court ordered that Weil Gotshal will not charge an hourly rate
above $1,000 per hour for any of its attorneys or personnel
providing services to the Debtors in connection with the Chapter
11 cases.
As reported in the TCR on Jan. 27, 2012, Weil Gotshal will, among
other things, (a) take all actions to protect and preserve the
estates of the Debtors, (b) take all actions in connection with a
plan of reorganization, and (c) perform all other legal services
in connection with the Debtors' Chapter 11 cases.
Joseph H. Smolinsky, a member of the firm, attests that Weil
Gotshal is a "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code, as modified by Section
1107(b) of the Bankruptcy Code. Weil Gotshal, which has a
$350,000 credit balance in favor of the Debtors, will charge the
Debtors based on an hourly basis and will seek reimbursement of
out of pocket expenses. Weil's customary hourly fees are $760 to
$1,075 for members and counsel, $430 to $750 for associates, and
$175 to $310 for paraprofessionals.
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six Power Plants and sell the electricity
generated by those Power Plants, as well as unforced capacity and
ancillary services, into the New York wholesale power market to
utilities and other intermediaries under short-term agreements or
directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., are the proposed counsel to the Creditors'
Committee.
AES EASTERN: Can Employ Richards Layton as Co-Counsel
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has granted
AES Eastern Energy, L.P., et al., permission to employ Richards,
Layton & Finger, P.A., as co-counsel for the Debtors, nunc pro
tunc to the Petition Date, under an evergreen retainer and in
accordance with Richards Layton's customary hourly rates and
reimbursement policies in effect when services are rendered.
As reported in the TCR on Jan. 27, 2012, as co-counsel, Richards
Layton will, among other things, (a) advise the Debtors of their
rights and powers as debtors-in-possession, (b) take action to
protect and preserve the Debtors' estates, and (c) prepare on
behalf of all the Debtors all motions and papers in connection
with the administration of the Debtors' estates. Richards Layton,
which has received a $150,000 retainer from the Debtors, says that
it is a "disinterested person" as the term is defined in 11 U.S.C.
Sec. 101(14). Personnel at the firm designated to represent the
Debtors have these standard hourly rates:
Mark D. Collins $750
Michael J. Merchant $575
Drew G. Sloan $350
Zachary I. Shapiro $325
Janel Gates $205
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six Power Plants and sell the electricity
generated by those Power Plants, as well as unforced capacity and
ancillary services, into the New York wholesale power market to
utilities and other intermediaries under short-term agreements or
directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., are the proposed counsel to the Creditors'
Committee.
AES EASTERN: Has Until Feb. 28 to File Schedules
------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
extended until Feb. 28, 2012, the time for AES Eastern Energy,
L.P., et al., to file their (i) schedules of assets and
liabilities, (ii) schedules of current income and expenditures,
(iii) schedules of executory contracts and unexpired leases, and
(iv) statements of financial affairs.
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six Power Plants and sell the electricity
generated by those Power Plants, as well as unforced capacity and
ancillary services, into the New York wholesale power market to
utilities and other intermediaries under short-term agreements or
directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants serves
as claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., are the proposed counsel to the Creditors'
Committee.
AGE REFINING: Court Denies Panel's Plea for Confirmation New Trial
------------------------------------------------------------------
The Hon. John C. Akard of the U.S. Bankruptcy Court for the
Western District of Texas denied the Official Committee of
Unsecured Creditors' motion for new trial under Rule 9023 Fed. R.
Bankr. P. and Rule 59(a)(1)(B) on the order confirming the Fourth
Amended Chapter 11 Plan of Reorganization.
As reported on the Troubled Company Reporter on Jan. 4, 2012,
Judge Akard confirmed the plan of reorganization filed by Eric J.
Moeller, the court appointed Chapter 11 trustee in the bankruptcy
case of Age Refining, Inc.
The judge confirmed the Chapter 11 plan at a hearing on Dec. 9.
A copy of the Fourth Amended Chapter 11 Plan of Reorganization was
filed Dec. 14, 2011, is available for free at:
http://bankrupt.com/misc/agerefining.doc1459.pdf
About Age Refining
Age Refining, Inc. owned a refinery in San Antonio, Texas. It
manufactured, refined and marketed jet fuels, diesel products,
solvents and other highly specialized fuels.
The Company filed for Chapter 11 bankruptcy protection (Bankr.
W.D. Tex. Case No. 10-50501) on Feb. 8, 2010. The Company
estimated $10 million to $50 million in assets and $100 million to
$500 million in liabilities in its bankruptcy petition. David S.
Gragg, Esq., and Steven R. Brook, Esq., at Langley & Banack,
Incorporated, in San Antonio, Texas, represent Eric J. Moeller,
Chapter 11 Trustee, as general counsel.
Eric Moeller has been named chapter 11 trustee to take management
of the Debtor from CEO Glen Gonzalez. In November 2010, the
trustee filed suit against Mr. Gonzalez, alleging he breached his
fiduciary duty by dipping into Company coffers for his personal
use while paying himself an excessive salary and stock
distributions.
David S. Gragg, Esq., Steven R. Brook, Esq., Natalie F. Wilson,
Esq., and Allen M. DeBard, Esq., at Langley & Banack, Inc., in San
Antonio, Tex., serve as general counsel to the Chapter 11 Trustee.
ALEXANDER GALLO: Liquidating Plan Set for Confirmation
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Alexander Gallo Holdings LLC scheduled a March 16
hearing for approval of the liquidating Chapter 11 plan when the
bankruptcy judge in New York approved the explanatory disclosure
statement last week.
About Alexander Gallo
Marietta, Georgia-based Alexander Gallo Holdings LLC --
http://www.alexandergalloholdings.com-- is the largest full
service, IT-enabled court reporting and litigation support
services company in the United States. AGH offers court
reporting, litigation support, trial software and other similar
services and has the only true national footprint in its market,
with roughly 55 offices located throughout the United States, and
a preferred provider network which serves as an extension of
Alexander Gallo's geographic reach. Founded in 1999 by Alexander
J. Gallo, a former court reporter, AGH has made 18 acquisitions
since 2003. Mr. Gallo has remained as CEO.
AGH, along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 11-14220) on Sept. 7, 2011.
Alexander Gallo will sell the business via 11 U.S.C. Sec. 363 to
Bayside Capital Inc., which had acquired $22 million in second-
lien debt. The price wasn't disclosed.
Alexander Gallo disclosed assets of $208 million and debt totaling
$258 million as of June 30, 2011. Liabilities include $47 million
on a first-lien revolving credit and term loan where Wells Fargo
Bank NA is agent. In addition to the second-lien debt held by
Bayside, there is $33 million in junior unsecured subordinated
notes owing to Harvest Equity Partners LLC plus another
$148 million in junior unsecured subordinated notes owing to
insider Gallo Holdings LLC. As reported in the Troubled Company
Reporter on Nov. 1, 2011, the Alexander Gallo disclosed
$41,981,048 in assets and $259,153,046 in liabilities as of the
Chapter 11 filing.
Bayside is providing $20 million in financing for the Chapter 11
effort. The new loan will have a first priority lien on
unencumbered assets and a lien behind the first-lien debt.
Bankruptcy Judge Allan J. Gropper presides over the case. Thomas
R. Califano, Esq., Jeremy R. Johnson, Esq., Esq., and Daniel G.
Egan, Esq., at DLA Piper LLP (US), in New York, serve as the
Debtors' general counsel. Squire, Sanders & Demsey (US) LLP
serves as the Debtor's corporate counsel. The Debtors' financial
advisor is Gordian Group, LLC. Marc L. Pfefferle, a partner at
Carl Marks Advisory Group LLC, serves as the Debtors' chief
restructuring advisor. Kurtzman Carson Consultants LLC serves as
the Debtor's claims agent. KPMG LLP serves as their auditors to
provide auditing, tax compliance and tax consulting services.
As reported in the TCR on Dec. 8, 2011, an affiliate of Bayside
Capital, Inc., completed the acquisition of Alexander Gallo's
assets.
ALLY FINANCIAL: Fitch Cuts Senior Unsecured Debt Rating to 'BB-'
----------------------------------------------------------------
Fitch Ratings has downgraded the long-term Issuer Default Rating
(IDR) and the senior unsecured debt rating of Ally Financial Inc.
(Ally) and its subsidiaries to 'BB-' from 'BB'. The Rating
Outlook is Negative.
The downgrade primarily reflects deteriorating operating trends in
Ally's wholly-owned mortgage subsidiary (Residential Capital LLC
or ResCap), which has continued to be a drag on Ally's
consolidated credit profile, as well as exposure to contingent
mortgage-related rep and warranty and litigation issues tied to
ResCap, which could potentially impact Ally's capital and
liquidity levels.
Current ratings also factor Ally's leading market position in the
auto finance space, solid credit quality of the auto portfolio,
improved funding flexibility offered through increased deposit
taking ability, and good capital and liquidity position.
Positive results in the auto segment, for full-year 2011, were
more than offset by weakness in the mortgage servicing business,
due to a $471 million MSR valuation charge, net of hedge in 3Q11
and $270 million foreclosure related charge in 4Q'11. As a
result, Ally reported a net loss of $201 million in 2011, compared
to net income of $1.1 billion in 2010. In conjunction with the
$270 million foreclosure related penalty, Ally provided $196.5
million in capital contributions to ResCap, in the form of
intercompany debt forgiveness, to cure a tangible net worth
covenant breach under ResCap's credit facilities.
Fitch views the $270 million foreclosure related penalty, if
finalized, positively as it would put a cap on potential
foreclosure related issues at ResCap. However, the demonstrated
capital support during 4Q'11 to ResCap makes it more likely, in
Fitch's view, that further support will be provided by Ally, if
necessary. This could negatively impact Ally's capital and
liquidity levels and be detrimental to creditors.
The mortgage industry continues to face regulatory headwinds,
which have resulted in increased servicing costs, lower margins
and potentially rigorous MSR implications. Although mortgage
related assets for the company have shrunk in recent years, ResCap
still continues to be the fifth largest mortgage servicer in the
U.S. ($382 billion servicing book as of Dec. 31, 2011), which will
continue to pressure operating performance and expose it to
contingent risks of loan put backs/ litigation from the private
label securities (PLS) investors/monolines and potential MSR-
related write downs.
After the 4Q'11 capital injection by Ally, ResCap's tangible net
worth still remains very close to the minimum required ($250
million) under its credit facilities and servicing agreement with
a GSE. Fitch believes that there is a very high probability that
this covenant could be tested in the near term considering
continued earnings pressure at ResCap and potential liability
exposure.
Capitalization metrics have weakened year over year primarily due
to the full year net loss. As of Dec. 31, 2011, tier 1 capital
ratio and tier 1 common ratio declined to 13.7% and 7.5%,
respectively, from 15% and 8.6%, respectively, at Dec. 31, 2010.
Fitch expects capital levels will improve in the long run as the
asset mix shifts towards lower risk auto receivables; however, in
the near term capital will remain at risk due to operating
pressure and contingent liabilities in the mortgage segment.
Proactive liquidity management is important as the company still
depends, to a large extent, on wholesale funding markets for its
origination needs. Parent company liquidity measured $26.9
billion at Dec. 31, 2011, comprising of $8.8 billion in cash and
unencumbered securities and the rest in committed capacity.
Liquidity is considered adequate and is currently managed in light
of $12.3 billion in unsecured debt maturities in 2012, including
$7.4 billion of TLGP debt maturing in 4Q'12. Nonetheless, Fitch
believes higher liquidity levels are required to address
significant contingent risks the company faces in its mortgage
business.
Funding diversity has improved since Ally became a bank holding
company in 2008, which has enabled the company to raise low-cost
retail deposits. Deposit growth has been robust with total
deposits reaching $45.1 billion at Dec. 31, 2011, an increase of
$6.1 billion from $39 billion at year-end 2010. Furthermore,
access to auto ABS markets has held up well despite volatile
capital markets conditions. In 2011, Ally raised nearly $38.3
billion of secured and unsecured funding, with over $6.5 billion
coming in 4Q'11.
The Negative Outlook reflects Fitch's expectation that pressure in
the mortgage segment will continue to be a drag on earnings,
capital and liquidity at the parent. Fitch would lower Ally's
ratings if material losses from rep and warranty or litigation
arise and Ally chooses to support it, and operating pressure in
the mortgage segment continues to impede a consistent return to
core profitability over the near term. Conversely, a sustained
return to profitability combined with timely resolution of
mortgage related issues, without materially impacting Ally's
capital and liquidity levels, would lead to ratings stability.
Established in 1919, Ally operates one of the world's largest
automotive finance companies in the U.S., Canada and 15 other
countries. The company also operates a residential mortgage
business focused on origination and servicing of conforming and
government insured loans, and through its subsidiary, Ally Bank,
offers online retail banking products. With approximately $184
billion in assets as of Dec. 31, 2011, Ally operates as a bank
holding company.
Fitch has taken the following rating actions:
Ally Financial Inc.
-- Long-term IDR downgraded to 'BB-' from 'BB';
-- Senior unsecured downgraded to 'BB-' from 'BB';
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B',
-- Viability rating downgraded to 'bb-' from 'bb';
-- Support affirmed at '5';
-- Support Floor affirmed at 'NF',
-- Long-term FDIC guaranteed debt affirmed at 'AAA';
GMAC International Finance B.V.
-- Long-term IDR downgraded to 'BB-' from 'BB',
-- Senior unsecured downgraded to 'BB-' from 'BB',
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
GMAC Bank GmbH
-- Long-term IDR downgraded to 'BB-' from 'BB',
-- Senior unsecured downgraded to 'BB-' from 'BB',
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
Ally Credit Canada Limited
-- Long-term IDR downgraded to 'BB-' from 'BB',
-- Senior unsecured downgraded to 'BB-' from 'BB',
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
GMAC Financial Services NZ Limited
-- Long-term IDR downgraded to 'BB-' from 'BB',
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
GMAC Australia LLC
-- Long-term IDR downgraded to 'BB-' from 'BB',
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
GMAC (U.K.) plc
-- Short-term IDR affirmed at 'B',
-- Short-term debt affirmed at 'B'.
The ratings on the foreign subsidiaries listed above principally
reflect the irrevocable and unconditional guarantee from Ally
Financial.
The Rating Outlook is Negative
The following ratings are maintained on Rating Watch Negative:
Ally Financial, Inc.
-- Perpetual preferred securities, series A 'B'.
GMAC Capital Trust I
-- Trust preferred securities, series 2 'B+'.
Fitch has withdrawn the following ratings:
Ally Financial, Inc.
-- Short-term FDIC guaranteed debt 'F1+'.
AMERICAN AMEX: Case Summary & 3 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: American Amex, Inc., a Nevada Corporation
c/o Ray Weilage, President
1697 Butterfly Court
Newbury Park, CA 91320
Bankruptcy Case No.: 12-30656
Chapter 11 Petition Date: February 1, 2012
Court: U.S. Bankruptcy Court
District of Oregon
Debtor's Counsel: D. Blair Clark, Esq.
LAW OFFICES OF D. BLAIR CLARK PLLC
1513 Tyrell Lane # 130
Boise, ID 83706
Tel: (208) 475-2050
E-mail: dbc@dbclarklaw.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Ray Weilage, president.
Debtor's List of Its Three Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bureau of Land Management Unpatented Mining $0
333 S.W. 1st Avenue Claims
Portland, OR 97204
Erwin Singh Braich, Trustee Suit for Specific Unknown
Peregrine Trust Performance
c/o Corey Byler Rew
Lorenzen & Hojem
P.O. Box 218
Pendleton, OR 97801
Jim Carpenter, Attorney Claims Unknown
601 S. Canyon Boulevard
John Day, OR 97845
AMERICAN AXLE: Reports $30 Million Net Income in Fourth Quarter
---------------------------------------------------------------
American Axle & Manufacturing Holdings, Inc., reported net income
of $30 million on $605.6 million of net sales for the three months
ended Dec. 31, 2011, compared with net income of $34.3 million on
$583.3 million of net sales for the same period a year ago.
The Company reported net income of $137.1 million on $2.58 billion
of net sales for the twelve months ended Dec. 31, 2011, compared
with net income of $114.5 million on $2.28 billion of net sales
during the prior year.
The Company's balance sheet as of Dec. 31, 2011, showed
$2.32 billion in total assets, $2.74 billion in total liabilities,
and a $419.6 million stockholders' deficit.
"The fourth quarter of 2011 capped a successful year for AAM.
AAM's full-year sales growth of 13% was significantly higher than
the industry growth rate and our profitability was steady and
strong throughout the year," said AAM's Co-Founder, Chairman of
the Board and Chief Executive Officer, Richard E. Dauch. "AAM's
continued leadership in the development of advanced driveline
technology has enabled us to grow our new business backlog to $1.1
billion in future annual sales for programs launching from 2012
through 2014. Combined with AAM's outstanding operational
expertise and our focus on achieving and sustaining market cost
competitiveness in all of our global operations, we believe AAM is
well positioned for continued profitable growth, accelerated
business diversification and improved balance sheet strength."
A full-text copy of the press release is available for free at:
http://is.gd/wiU1dQ
About American Axle
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- manufactures,
engineers, designs and validates driveline and drivetrain systems
and related components and chassis modules for light trucks, sport
utility vehicles, passenger cars, crossover vehicles and
commercial vehicles. AXL has financial support from GM, its
largest customer which accounted for 78% of sales in 2009.
* * *
In June 2011, Standard & Poor's Ratings Services raised its
corporate credit rating on American Axle & Manufacturing Holdings
Inc. to 'BB-' from 'B+'. The outlook is stable. "At the same
time, we raised our issue-level ratings on the company's senior
secured debt to 'BB' from 'BB-' and on the unsecured debt to 'B'
from 'B-'. All the recovery ratings on the debt remain
unchanged," S&P stated. "The upgrade reflects our opinion that
American Axle's credit measures will improve further over the next
12 months under the gradual recovery in North American auto
demand, and that the company's leverage will decline to 3.5x,"
said Standard & Poor's credit analyst Lawrence Orlowski.
As reported by the TCR on June 3, 2011, Moody's Investors Service
raised American Axle's Corporate Family Rating and Probability of
Default Rating to 'B1' from 'B2'. The raising of American Axle's
CFR to B1 incorporates Moody's expectation that the company's
improved year-over-year EBIT margin will largely be sustained over
intermediate-term despite potential temporary automotive
production disruptions and high gasoline prices.
AMERICAN INT'L: Fitch Lifts Rating on Sub. Debt Issues to 'BB'
--------------------------------------------------------------
Fitch Ratings has affirmed its 'BBB' rating on American
International Group, Inc.'s (AIG) senior unsecured notes and its
'A' Insurer Financial Strength (IFS) ratings on various AIG
insurance company subsidiaries, all with a Stable Rating Outlook.
Additionally, Fitch has affirmed AIG's Issuer Default Rating (IDR)
at 'BBB' and revised the Rating Outlook to Positive from Stable.
Fitch has also upgraded its ratings on AIG's various subordinated
debt issues to 'BB' from 'BB-'.
Today's rating actions follow a periodic review of AIG's recent
operational and financial results. Fitch's ratings on AIG and its
subsidiaries primarily reflect the benefits of the AIG
organization's strong competitive positions in life and non-life
insurance partially offset by the comparatively poor recent
operating results of the company's core insurance operations.
The Positive Outlook on AIG's IDR and the upgrade of the company's
subordinated securities ratings reflect improvements in the AIG's
liquidity and financial profile over the last 12-18 months as it
shed operations and de-leveraged.
As part of its rating analysis, Fitch considers the credit profile
of AIG absent consideration of the U.S. Treasury's majority
ownership. Fitch's assessments of AIG's stand-alone IDR and
senior unsecured debt are 'BBB' and 'BBB-', respectively, with a
Positive Outlook. These levels are one notch higher than they
were when Fitch last commented on AIG's stand-alone assessments.
AIG's IDR is now equivalent to its stand-alone assessment, while
the rating on AIG's senior unsecured debt reflects a one-notch
uplift derived from the U.S. Treasury's approximate 78% equity
ownership in AIG.
Fitch believes that AIG has reasonable access to public and
private capital markets, a key characteristic of investment-grade
rated insurance holding companies. Since December 2010, the
company has raised $6.9 billion through public debt and equity
offerings and entered into a $4.5 billion syndicated bank credit
facility. In addition, AIG has significantly reduced its
financial leverage over the last 12-18 months and the company's
ratio of holding company financial debt-to-capital of 19% at Sept.
30, 2011, approximates that of industry peers.
However, broader leverage metrics, such as Fitch's Total
Financings & Commitment (TFC) Ratio, indicate that AIG remains
more leveraged than insurance industry peers, due to the company's
comparatively heavy use of debt to fund spread-based investments,
the financing needs of the company's aircraft leasing subsidiary,
and the notional value of the company's run-off portfolio of
credit-default swap (CSDS ) contracts, all of which Fitch views as
forms of leverage. At Sept. 30, 2011, AIG's TFC ratio was 1.6
times (x), a dramatic improvement from the company's year-end 2008
ratio of 10.4x but still higher than insurance industry averages
which Fitch estimates at approximately 1.0x for large domestic
life insurers and 0.5x for large commercial lines focused non-life
insurers.
The agency estimates AIG's annual run-rate interest expense from
holding-company financial debt at approximately $1.6 billion.
After adjusting Chartis' pre-tax operating earnings to exclude
abnormal catastrophe-related losses and prior accident year
reserve charges, Fitch calculates AIG's recent operating earnings-
based interest coverage generated by the company's core Chartis
and SunAmerica Financial Group (SAFG) units at 4.0x-4.5x compared
to industry averages in the 7.0x-9.0x range. Recent coverage
ratios before these adjustments have been in the 1.6x-2.0x range.
Fitch believes that AIG's net earnings are likely to be more
exposed to capital market and economic volatility than those of
insurance industry peers over the next 12-24 months due to the
company's investments in publicly-traded operating companies and
special purpose vehicles which are marked-to-market each quarter,
and due to its investment in its aircraft leasing subsidiary,
whose earnings Fitch views as highly cyclical.
AIG has disclosed its goal of improving its normalized after-tax
operating return on equity (ROE) to 10% or higher by year-end
2015, compared to 6.2% as of year-end 2010, through a combination
of earnings growth and capital management initiatives. Key
components of these efforts call for the growth in assets under
management at SAFG and reducing Chartis' combined ratio to 90%-
95%. Fitch believes that if these objectives are achieved, AIG's
operating performance would more closely resemble those of
similarly positioned peers that generally carry higher ratings
than AIG.
Fitch notes that Chartis has implemented changes to its
underwriting processes that more explicitly consider each business
line's risk-adjusted profitability and the cost of capital
required to support the underwritten business. The agency views
these changes as more closely aligning Chartis' underwriting
practices with those of peers that have similarly large market
shares and strong competitive potions. SAFG's domestic life
insurance and annuity business and Chartis' global non-life
insurance business have large market shares in specific business
lines and markets that Fitch views as evidence of strong
competitive positions.
SAFG is a leader in bank distributed annuities, retirement
products targeted at educators, and has a solid position in the
term life insurance market. The agency notes that SAFG has re-
established distribution arrangements with principally all
distributors that discontinued sales of SAFG's products during the
height of the financial crisis. Nevertheless, Fitch's view is
that it will take additional time for the company's new sales
trends, and premiums and deposit base to recover to levels the
organization produced prior to the financial crisis. Importantly,
the SAFG companies maintain strong NAIC risk-based capital (RBC)
ratios and traditional leverage ratios that approximate those of
peers.
Based on premiums written, Chartis is the largest commercial line
insurance company in the U.S. where it has leading market shares
in liability business lines. Fitch believes that the company
enjoys a meaningful size and scale advantage over its peers and
that Chartis' competitive position remains comparable to those of
its peers domestically, and unmatched internationally.
Chartis' long-term underwriting results have lagged those of peers
due to prior accident year reserve development that adversely
affect comparative results. Additionally, the company's NAIC RBC
ratios are generally lower by a meaningful margin than those of
large domestic peers that concentrate on writing commercial
insurance.
Fitch considers Chartis' reported reserves to be within a
reasonable range of estimates the agency developed in part based
on Schedule P data included in the company's combined statutory
annual statement. Additionally, Fitch believes that the risk of
the company experiencing material adverse development is
adequately incorporated into Chartis' current ratings. Fitch's
view is that Chartis' June 2011 decision to reinsure its asbestos
claims and charges the company took in 2009 and 2010 to add to
prior accident year reserves have materially decreased the
company's exposure to adverse reserve development.
Fitch has taken the following rating actions:
American International Group, Inc.
-- Long-term IDR affirmed at 'BBB'; Outlook to Positive from
Stable;
-- Various senior unsecured note issues affirmed at 'BBB';
-- USD1.2 billion of 4.250% senior unsecured notes due Sept. 15,
2014 affirmed at 'BBB';
-- USD800 million of 4.875% senior unsecured notes due Sept. 15,
2016 affirmed at 'BBB';
-- Eur420.975 million of 6.797% senior unsecured notes due Nov.
15, 2017 affirmed at 'BBB';
-- GBP323.465 million of 6.765% senior unsecured notes due Nov.
15, 2017 affirmed at 'BBB';
-- GBP338.757 million of 6.765% senior unsecured notes due Nov.
15, 2017 affirmed at 'BBB';
-- USD256.161 million of 6.820% senior unsecured notes due Nov.
15, 2037 affirmed at 'BBB';
-- Eur750 million of 8.00% series A-7 junior subordinated
debentures due May 22, 2038 upgraded to 'BB' from 'BB-';
-- USD1.960 billion 5.67% series B-1 debentures due Feb. 15,
2041 upgraded to 'BB' from 'BB-';
-- USD1.960 billion of 5.82% series B-2 debentures due May 1,
2041 upgraded to 'BB' from 'BB-';
-- USD1.960 billion of 5.89% series B-3 debentures due Aug. 1,
2041 upgraded to 'BB' from 'BB-;
-- USD 4 billion of 8.175% series A-6 junior subordinated
debentures due May 15, 2058 upgraded to 'BB' from 'BB-';
-- USD 1.1 billion of 7.700% series A-5 junior subordinated
debentures due Dec. 18, 2062 upgraded to 'BB' from 'BB-';
-- GBP309.850 million of 5.75% series A-2 junior subordinated
debentures due March 15, 2067 upgraded to 'BB' from 'BB-';
-- Eur409.050 million of series A-3 junior subordinated
debentures due March 15, 2067 upgraded to 'BB' from
'BB-';
-- GBP900 million of 8.625% series A-8 junior subordinated
debentures due May 22, 2068 upgraded to 'BB' from 'BB-';
-- USD750 million of 6.45% series A-4 junior subordinated
debentures due June 15, 2077 upgraded to 'BB' from 'BB-';
-- USD687.581 million of 6.25% series A-1 junior subordinated
debentures due March 15, 2087 upgraded to 'BB' from 'BB-'.
AIG International, Inc.
-- Long-term IDR affirmed at 'BBB', Outlook to Positive from
Stable;
-- $175 million of 5.60% senior unsecured notes due July 31,
2097 affirmed at 'BBB'.
SunAmerica Financial Group, Inc.
-- Long-term IDR affirmed at 'BBB', Outlook to Positive from
Stable;
-- $150 million of 7.50% senior unsecured notes due July 15,
2025 affirmed at 'BBB';
-- $150 million of 6.625% senior unsecured notes due Feb. 15,
2029 affirmed at 'BBB'.
American General Capital II
-- $300 million of 8.50% preferred securities due July 1, 2030
upgraded to 'BB' from 'BB-'.
American General Institutional Capital A
-- $500 million of 7.57% capital securities due Dec. 1, 2045
upgraded to 'BB' from 'BB-'.
American General Institutional Capital B
-- $500 million of 8.125% capital securities due March 15, 2046
upgraded to 'BB' from 'BB-'.
Fitch has affirmed the following IFS ratings at 'A' with a Stable
Outlook:
AGC Life Insurance Company
AIU Insurance Company
American General Life Insurance Company
American General Life Insurance Company of Delaware
American General Life & Accident Insurance Company
American Home Assurance Company
Chartis Casualty Company
Chartis Europe Limited
Chartis MEMSA Insurance Company Limited
Chartis Overseas Limited
Chartis Property Casualty Company
Chartis Specialty Insurance Company
Commerce & Industry Insurance Company
Granite State Insurance Company
Illinois National Insurance Company
Insurance Company of the State of Pennsylvania
Lexington Insurance Company
National Union Fire Insurance Company
New Hampshire Insurance Company
SunAmerica Annuity and Life Assurance Company
SunAmerica Life Insurance Company
United States Life Insurance Company in the City of New York
Variable Annuity Life Insurance Company
Western National Life Insurance Company
Fitch has affirmed the following program ratings at 'A':
ASIF II Program
ASIF III Program
ASIF Global Financing
Fitch has withdrawn the 'A' Insurer Financial Strength Rating of
First SunAmerica Life Insurance Company. The company has been
merged into United States Life Insurance Company.
AMERICAN PEGASUS: U.S. Court Recognizes Cayman Islands Proceeding
-----------------------------------------------------------------
The Hon. Thomas E. Carlson of the U.S. Bankruptcy Court for
Northern District of California granted American Pegasus SPC
recognition of foreign proceeding under Chapter 15 of the
Bankruptcy Code.
The Court also ordered that the Cayman Islands proceeding is
granted recognition as a foreign main proceeding pursuant to
Section 1517(b)(1) of the Bankruptcy Code.
The Court further said that all relief afforded a foreign main
proceeding automatically upon recognition pursuant to Section 1520
of the Bankruptcy Code is granted.
Sections 361 and 362 of the Bankruptcy Code apply with respect to
American Pegasus SPC and all of its property within the
territorial jurisdiction of the United States.
Joint Official Liquidators Stuart Sybersma and Michael Pearson are
approved as foreign representatives of the Debtor. They will have
exclusive authority to administer its assets and affairs
including, without limitation, any transfer of or withdrawals
from, or access to the records of, any bank accounts maintained by
American Pegasus SPC.
About American Pegasus SPC
American Pegasus SPC filed for bankruptcy (Chapter 15 N.D. Calif.
Case No. 11-34429) on Dec. 13, 2011. Bankruptcy Judge Thomas E.
Carlson presides over the case.
Joint Official Liquidators Stuart Sybersma and Michael Pearson,
foreign representatives of American Pegasus SPC, estimated in the
Chapter 15 petition that the company has assets of US$10,000,001
to US$50,000,000 and debts of US$100,000,001 to US$500,000,000.
Randy Michelson, Esq., at Michelson Law Group represents Messrs.
Sybersma and Pearson.
APEX HOMES: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Apex Homes
7172 Rt. 522
Middleburg, PA 17842-9612
Bankruptcy Case No.: 12-00560
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Middle District of Pennsylvania (Harrisburg)
Judge: Robert N. Opel II
Debtor's Counsel: Henry W. Van Eck, Esq.
METTE, EVANS, & WOODSIDE
3401 North Front Street
Harrisburg, PA 17110-0950
Tel: (717) 232-5000
Fax: (717) 236-1816
E-mail: hwvaneck@mette.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/pamb12-00560.pdf
The petition was signed by Chriss R. Nipple, president.
AQUILEX HOLDINGS: Completes Debt Swap, Centerbridge Takes Over
--------------------------------------------------------------
Aquilex Holdings LLC said Jan. 27 that holders of 98.3% of senior
notes agreed to the exchange offer announced after the company
missed a Dec. 15 interest payment. The company said on its
website that the exchange offer will be implemented by Feb. 3.
Once completed, the restructuring will reduce Aquilex's
outstanding debt by 70%, or approximately $318 million, and debt
service costs will decline by 69% to approximately $13 million
annually. This reduction in debt and associated interest payments,
coupled with the Company's cash position of $36.5 million as of
Friday, Jan. 27, 2012, and new $50 million revolving credit
facility, significantly bolsters the Company's balance sheet and
improves its capital structure. In conjunction with the completion
of the restructuring, affiliates of Center
When announced in December, Atlanta-based Aquilex said the
exchange offer was already supported by holders of all the
first- and second-lien debt and by 92 percent of the 11.175%
senior unsecured notes.
About Aquilex Holdings
Aquilex Holdings LLC is the parent of Aquilex Corporation, a
leading provider of critical maintenance, repair and industrial
cleaning solutions to the energy industry. Through our divisional
and branch offices in the United States and Europe, we provide our
services to a diverse global base of over 600 customers, primarily
in the oil and gas refining, chemical and petrochemical
production, fossil and nuclear power generation and waste-to-
energy industries.
The Company's Credit Agreement requires it to maintain certain
financial ratios, including a minimum ratio of Adjusted EBITDA to
total interest expense and maximum ratios of total debt and senior
secured debt to Adjusted EBITDA.
"While the Company was in compliance with its debt covenants as of
June 30, 2011, based on current business conditions and forecast,
there can be no assurance that the Company will be in compliance
with those covenants as of Sept. 30, 2011, or thereafter," the
Company said in its Form 10-Q for the quarter ended June 30, 2011.
The Company also reported a net loss of $298.61 million on
$327.74 million of revenue for the nine months ended Sept. 30,
2011, compared with a net loss of $27.53 million on
$324.04 million of revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$400.49 million in total assets, $505.51 million in total
liabilities, and a $105.01 million total deficit.
Aquilex said there can be no assurance that the Company will be
able to restructure its debt and obtain sufficient additional
sources of liquidity in order to address its cash needs, or to
obtain any forbearance for any failure to make a scheduled
interest payment on the senior notes or any additional forbearance
for covenant defaults under its Credit Agreement. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
Bankruptcy Warning
The Company said in its quarterly report for the quarter ended
Sept. 30, 2011, that to meet the Company's cash needs for the next
twelve months and over the longer term, the Company expects that
it will be required to restructure its debt obligations and obtain
additional liquidity sources, because the Company does not expect
that it will generate sufficient cash from its operations to fund
its debt service along with its operating expenses, capital
expenditures and other cash requirements over that period.
AQUILEX HOLDINGS: Suspending Filing of Reports with SEC
-------------------------------------------------------
Aquilex Holdings LLC filed a Form 15 notifying of the suspension
of its duty under Section 15(d) to file reports required by
Section 13(a) of the Securities Exchange Act of 1934 with respect
to its 11 1/8% Senior Notes due 2016 and Guarantees of the 11 1/8%
Senior Notes due 2016. Pursuant to Rule 12h-3, the Company is
suspending reporting because there are currently less than 300
holders of record of the Senior Notes. There were only 12 holders
of the Senior Notes as of Feb. 3, 2012.
About Aquilex Holdings
Aquilex Holdings LLC is the parent of Aquilex Corporation, a
leading provider of critical maintenance, repair and industrial
cleaning solutions to the energy industry. Through our divisional
and branch offices in the United States and Europe, we provide our
services to a diverse global base of over 600 customers, primarily
in the oil and gas refining, chemical and petrochemical
production, fossil and nuclear power generation and waste-to-
energy industries.
The Company's Credit Agreement requires it to maintain certain
financial ratios, including a minimum ratio of Adjusted EBITDA to
total interest expense and maximum ratios of total debt and senior
secured debt to Adjusted EBITDA.
"While the Company was in compliance with its debt covenants as of
June 30, 2011, based on current business conditions and forecast,
there can be no assurance that the Company will be in compliance
with those covenants as of Sept. 30, 2011, or thereafter," the
Company said in its Form 10-Q for the quarter ended June 30, 2011.
The Company also reported a net loss of $298.61 million on
$327.74 million of revenue for the nine months ended Sept. 30,
2011, compared with a net loss of $27.53 million on
$324.04 million of revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$400.49 million in total assets, $505.51 million in total
liabilities, and a $105.01 million total deficit.
Aquilex said there can be no assurance that the Company will be
able to restructure its debt and obtain sufficient additional
sources of liquidity in order to address its cash needs, or to
obtain any forbearance for any failure to make a scheduled
interest payment on the senior notes or any additional forbearance
for covenant defaults under its Credit Agreement. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
Bankruptcy Warning
The Company said in its quarterly report for the quarter ended
Sept. 30, 2011, that to meet the Company's cash needs for the next
twelve months and over the longer term, the Company expects that
it will be required to restructure its debt obligations and obtain
additional liquidity sources, because the Company does not expect
that it will generate sufficient cash from its operations to fund
its debt service along with its operating expenses, capital
expenditures and other cash requirements over that period.
ARCADIA RESOURCES: Peter Brusca Resigns from Board of Directors
---------------------------------------------------------------
Arcadia Resources, Inc., was notified that director Peter M.
Brusca, M.D., has resigned from the Board of Directors effective
Jan. 30, 2012. Dr. Brusca's resignation from the Board was for
personal reasons and is not the result of any disagreement on any
matter related to the Company's operations, policies or practices.
Dr. Brusca served as a member of the Audit, Compensation and
Nominating and Corporate Governance Committees of the Board.
About Arcadia HealthCare
Arcadia HealthCare is a service mark of Arcadia Resources, Inc.
(nyse amex:KAD), and is a leading provider of home care, medical
staffing and pharmacy services under its proprietary DailyMed
program. The Company, headquartered in Indianapolis, Indiana, has
65 locations in 18 states. Arcadia HealthCare's comprehensive
solutions and business strategies support the Company's vision of
"Keeping People at Home and Healthier Longer."
The Company reported a net loss of $14.35 million on
$100.04 million of revenues for the fiscal year ended March 31,
2011, compared with a net loss of $31.09 million on $98.08 million
of revenues for the fiscal year ended March 31, 2010.
The Company also reported a net loss of $5.98 million on $40.86
million of revenue for the six-month period ended Sept. 30, 2011,
compared with a net loss of $6.93 million on $41.29 million of
revenue for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$23.69 million in total assets, $49.52 million in total
liabilities, and a $25.82 million total stockholders' deficit.
BDO USA, LLP, in Troy, Michigan, expressed substantial doubt about
Arcadia Resources' ability to continue as a going concern. The
independent auditors noted that the Company has suffered recurring
losses from operations and has a net capital deficiency.
Bankruptcy Warning
The Company continues to generate negative cash flows on a
consolidated basis. As of Sept. 30, 2011, the Company has $42.3
million of outstanding debt, of which $37.8 million is due in or
before April 2012. As of Sept. 30, 2011, 193 million of the 300
million authorized shares of common stock were outstanding. The
Company's stock price as of Sept. 30, 2011, was $0.025. The
Company has received notices of default from its two secured
lenders, Comerica Bank and HD Smith. The Company intends to sell
or wind down its Pharmacy segment operations and is analyzing the
various alternatives for its Services segment, which includes the
divestiture of the business. If these sale transactions are
consummated, it is highly unlikely that proceeds from these
transactions will be adequate to pay down all of the secured debt
and a significant portion of the unsecured debt. Additionally, it
is possible that issues of liquidity or other factors could cause
the Company to file a petition for relief under the United States
Bankruptcy Code or initiate other reorganization proceedings.
ATLANTIC & PACIFIC: Plan Confirmation Hearings Begin
----------------------------------------------------
The Hon. Robert D. Drain the U.S. Bankruptcy Court for the
Southern District of New York will convene a hearing on Feb. 6,
2012, at 10:00 a.m., prevailing Eastern Time, and Feb. 7, at
10:00 a.m. to consider the confirmation of The Great Atlantic &
Pacific Tea Company, Inc., et al.'s Plan of Reorganization.
The voting deadline and objections were due Jan. 24.
As reported in the Troubled Company Reporter on Dec. 23, 2011, the
plan was made possible by $490 million in debt and equity
financing to be provided by Yucaipa Cos., Goldman Sachs Group Inc.
and Mount Kellett Capital Management LP.
The TCR also reported that the revised disclosure statement tells
unsecured creditors they can expect to recover to 2.1% to 2.7%.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/GreatAtlantic_ds.pdf
About Great Atlantic & Pacific
Founded in 1859, Montvale, New Jersey-based Great Atlantic &
Pacific is a supermarket retailer, operating under a variety of
well-known trade names, or "banners" across the mid-Atlantic and
Northeastern United States. Before filing for bankruptcy in 2010,
A&P operated 429 stores in 8 states and the District of Columbia
under the following trade names: A&P, Waldbaum's, Pathmark,
Pathmark Sav-a-Center, Best Cellars, The Food Emporium, Super
Foodmart, Super Fresh and Food Basics. A&P had 41,000 employees
prior to the bankruptcy filing.
A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y.
Case No. 10-24549) on Dec. 12, 2010, in White Plains, New York.
In its petition, A&P reported total assets of $2.5 billion and
liabilities of $3.2 billion as of Sept. 11, 2010.
Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C.
Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J.
Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois,
serve as counsel to the Debtors. Kurtzman Carson Consultants LLC
is the claims and notice agent. Lazard Freres & Co. LLC is the
financial advisor. Huron Consulting Group is the management
consultant. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and
Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represent the Official Committee of Unsecured Creditors.
A&P obtained court approval for a new contract with C&S Wholesale
Grocers Inc., its principal supplier. The contract is designed to
save A&P $50 million a year when the supermarket operator emerges
from Chapter 11 reorganization.
A&P sold 12 Super-Fresh stores in the Baltimore-Washington area
for $37.83 million, plus the value of inventory. Thirteen other
locations didn't attract buyers at auction and were closed mid-
July 2011.
A&P filed a proposed Chapter 11 plan founded upon a $490 million
debt and equity financing announced this month. The proposed
financing, tentatively approved by the bankruptcy judge, allows
A&P to accept a better offer if one appears. New investors
sponsoring the plan include Yucaipa Cos., Goldman Sachs Group Inc.
and Mount Kellett Capital Management LP.
AVANTAIR INC: Board of Directors Approves 2012 ALTIP
----------------------------------------------------
The Board of Directors of Avantair, Inc., upon recommendation of
the Compensation Committee, approved the 2012 annual and long-term
incentive plan for the executive officers and other various
employees of the Company. The ALTIP sets forth grant levels, the
grant type and the type of performance targets and metrics for
fiscal year 2012. The ALTIP performance cycle is for the current
fiscal year, which began on July 1, 2011, and ends on June 30,
2012.
The ALTIP provides for an annual incentive compensation target
award payable in cash. The target award payout is a percentage of
each of our executive officer's annual base salary. Payments to
executive officers for fiscal year 2012 under the ALTIP will be
based on the achievement of these targets:
* The Company achieving a specified GAAP net income: 35% of
target award
* The Company achieving a specified EBIDTA earnings: 35% of
target award
* Executive officer achieving individual goals as previously
set by the Committee: 30% of target award
The ALTIP also provides for a long term incentive compensation
component payable in the form of stock options to be issued under
the Company's 2006 Long Term Incentive Plan. The number of
options to be issued will be based solely on achieving the same
target goals and thresholds for GAAP net income and EBIDTA
earnings required for in the 2012 annual incentive compensation
award discussed above. The stock options will be granted with an
exercise price equal to the greater of the closing price of the
Company's common stock on the date of grant of the option or $2.00
per share. Further, all stock options granted will have a three
year annual ratable vesting period. The number of shares to be
issued will be calculated by dividing the dollar amount of the
target award amount by the greater of the closing price of the
Company's common stock on the date of grant of the option or $2.00
per share.
A full-text copy of the Form 8-K is available for free at:
http://is.gd/Ft0FuK
About Avantair Inc.
Headquartered in Clearwater, Fla., Avantair, Inc. (OTC BB: AAIR)
-- http://www.avantair.com/-- sells fractional ownership
interests in, and flight hour card usage of, professionally
piloted aircraft for personal and business use, and the management
of its aircraft fleet. According to AvData, Avantair is the fifth
largest company in the North American fractional aircraft
industry.
Avantair also operates fixed flight based operations (FBO) in
Camarillo, California and in Caldwell, New Jersey. Through these
FBOs and its headquarters in Clearwater, Florida, Avantair
provides aircraft maintenance, concierge and other services to its
customers as well as to the Avantair fleet.
The Company's balance sheet at Sept. 30, 2011, showed
$110.24 million in total assets, $141.42 million in total
liabilities, $14.73 million in Series A convertible preferred
stock, and a $45.91 million total stockholders' deficit.
BCBG MAX: Moody's Downgrades CFR to Caa2; Outlook Negative
----------------------------------------------------------
Moody's Investors Service downgraded BCBG Max Azria Group, Inc.'s
(BCBG) Corporate Family Rating and Probability of Default Rating
to Caa2 from B3 and the first lien term loan rating to B3 from B2.
The rating outlook is negative.
Moody's downgraded BCBG's ratings and maintained a negative
outlook because the company's operating performance has been
materially weaker than expected. BCBG's credit metrics and
financial flexibility have deteriorated significantly due to the
company's faster-than-anticipated exit from its mass market Wal-
Mart business as well as a considerable decline in its wholesale
revenues. As a result, Moody's expects debt/EBITDA (incorporating
Moody's standard analytical adjustments) to be sustained well
above 7.0 times for the foreseeable future, a level not consistent
with a higher rating. Furthermore, in Moody's opinion, liquidity
risk has increased, as the lower-than-expected earnings will
likely cause the company to violate its bank covenants. If the
company's performance does not improve, there is a possibility
that its current capital structure may not be sustainable, and the
ratings could be downgraded further.
These ratings were downgraded and LGD point estimates were
modified:
- Corporate Family Rating to Caa2 from B3
- Probability of Default Rating to Caa2 from B3
- $230 million first lien term loan rating to B3 (LGD3, 32%) from
B2 (LGD3, 35%)
RATINGS RATIONALE
BCBG's Caa2 Corporate Family Rating reflects its weak liquidity
including Moody's expectation for bank covenants violations, its
weak credit metrics, and its inconsistent track record of
operating performance. At the same time, the rating is supported
by the brand name and the strength in BCBG's core retail segment,
which continues to report positive same store sales increases.
The negative outlook reflects Moody's expectation that the
company's liquidity will remain weak and that it will operate at a
meaningfully smaller scale while maintaining a heavy debt burden.
Ratings could be downgraded if the company is not able to amend
its covenant levels, if availability under the revolver
significantly tightens, if it does not receive a clean audit, or
if liquidity deteriorates for any reason.
Given the meaningful top-line deterioration and the significant
liquidity concerns, an upgrade in the near term is unlikely.
However, the rating outlook could revert to stable if earnings
performance and liquidity shows meaningful improvement. Over time,
ratings could be upgraded if operating performance improves in
both the retail and wholesale segments and liquidity remains
adequate. Specifically, an upgrade will require debt/EBITDA
approaching 6.5 times.
The principal methodology used in rating BCBG Max Azria Group,
Inc. was the Global Retail Industry Methodology published in June
2011. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Headquartered in Vernon, California, BCBG Max Azria Group, Inc.
designs, markets, distributes and licenses women's apparel,
footwear and accessories through its retail and wholesale
segments. The company operates 467 stores consisting of 170 retail
stores, 106 factory stores and 191 partner stores. Revenues for
the fiscal year ended January 28, 2011 are expected to be well
below $800 million. Foreign operations are not part of the rated
entity. BCBG is wholly owned by Max and Lubov Azria.
BGC PARTNERS: Moody's Changes Outlook on Ba1 Sr. Rating to Neg.
---------------------------------------------------------------
Moody's Investors Service changed its rating outlooks to negative
from stable on Cantor Fitzgerald L.P. (senior at Baa3) and its
minority owned subsidiary BGC Partners, Inc. (senior at Ba1).
RATINGS RATIONALE
The negative outlook reflects the prospects for reduced
profitability at Cantor Fitzgerald in 2012. Cantor was only
modestly profitable in 2011 and since August 2011 the operating
environment for institutional capital markets firms has become
considerably more difficult.
Moody's observed that management at Cantor Fitzgerald now faces
difficult decisions, as the firm attempts to revitalize the
profitability of its institutional capital markets expansion
strategy - while maintaining its culture of emphasizing
distribution and controlling risk. As a partnership, Cantor
Fitzgerald is not subject to the same shareholder pressure of a
public company and this is an important benefit to bondholders as
Cantor adapts to the current market environment.
The negative outlook also reflects high levels of leverage at
Cantor Fitzgerald. Moody's noted that Cantor Fitzgerald runs a
substantial matched book relative to its size, resulting in high
gross leverage. Cantor's leverage is mitigated by the rapid
turnover of its inventory as well as the high credit quality and
liquidity of the assets financed in its matched book. The firm has
a conservative policy towards the collateral advance rates and the
collateral it will accept in its match book - the vast majority of
which is eligible for clearing at clearing corporations.
Moody's will continue to monitor the firm's policies regarding
leverage, asset quality and capital retention. "Given the velocity
of Cantor's balance sheet, management can quickly adjust the
firm's level of leverage by shrinking assets or retaining more
capital in the partnership, " said Peter Nerby, a Moody's Senior
Vice-President. "However, this impairs the firm's ability to
generate a competitive return on capital, and therefore it faces
both tactical and strategic decisions."
The negative outlook on the rating of BGC Partners reflects its
close relationship to Cantor Fitzgerald. The two firms are closely
linked as evidenced by reciprocal service agreements between the
two firms and Cantor Fitzgerald's role in providing long term
funding to its affiliate in 2010.
The principal methodology used in this rating was Global
Securities Industry Methodology published in December 2006.
BEACON POWER: Assets to be Sold to Rockland Capital
---------------------------------------------------
Rockland Capital, a private equity firm focused on energy-related
investments, will acquire Beacon Power Corporation's 20-megawatt
flywheel energy storage plant in Stephentown, New York, and most
of the other assets of the Company, based on its offer made
Feb. 3, 2012, in accordance with the process negotiated with the
Loan Program Office of the U.S. Department of Energy. Rockland
Capital was the successful acquirer among several leading energy
and technology firms that vied for the opportunity following
Beacon's Chapter 11 bankruptcy filing on Oct. 30, 2011.
Under terms of the agreement and subject to court approval on
Feb. 7, 2012, Rockland will purchase substantially all assets of
Beacon Power and its Stephentown subsidiary, for a combination of
cash and a promissory note totaling $30.5 million, along with
additional guarantees and funding obligations to DOE of $6.6
million. Rockland's purchase includes all assets of the Company's
20 MW flywheel regulation plant in Stephentown; all assets in
Beacon's Tyngsboro headquarters including the intellectual
property, inventory, spare parts, and equipment; assumption of an
amended property lease in Tyngsboro to enable continuing
operations; and many of the contracts associated with operation of
the business.
The acquired assets and agreements will be placed into a new
private company named Beacon Power LLC, wholly owned by Rockland,
which will rehire a majority of the current Beacon staff into the
new company. Rockland also intends to provide the necessary
equity capital to develop a second 20 MW flywheel regulation plant
in Pennsylvania. In addition to approval by the bankruptcy court,
the Federal Energy Regulatory Commission must approve the sale of
the Stephentown assets.
Scott Harlan, Managing Partner for Rockland Capital, said, "We
were attracted to Beacon Power because of its effective fast-
response, grid-connected energy storage technology and its
successful experience applying this technology as a frequency
regulation resource in Stephentown. With the implementation later
this year of FERC-mandated pay-for-performance compensation for
balancing services provided to the grid, both the Stephentown
plant and the one we plan to build in Pennsylvania will realize
much improved revenue. We're pleased to make it possible for this
company and its talented team to continue to innovate and grow,
and to provide a runway to facilitate a path to commercial
success."
Bill Capp, Beacon President and chief executive officer,
commented, "Rockland Capital is a well-capitalized company that
has an excellent track record of successfully identifying
undervalued electric power generating assets and applying its
knowledge of the business and the capital necessary to develop the
full potential of those assets. They recognized early on that
Beacon was one such opportunity and our relationship has been
positive and productive throughout their evaluation process. We're
grateful for their commitment to support Beacon and we look
forward to working together and achieving our commercial
objectives."
The sale of Beacon's Stephentown plant and other assets was
organized and conducted by Beacon's financial advisors, CRG
Partners, and legal counsel, Brown Rudnick LLP.
About Rockland Capital
Rockland Capital -- http://www.rocklandcapital.com/-- a private
equity firm founded in 2003, is focused on the acquisition,
optimization and development of companies and projects in the
North American power sector. The firm manages Rockland Power
Partners and Rockland Capital Energy Investments and has offices
in Houston and New York. More information is available at.
About Beacon Power
Beacon Power filed for Chapter 11 protection on Oct. 30, 2011, in
Delaware (Bankr. D. Del. Case No. 11-13450). Brown Rudnick and
Potter Anderson & Corroon serve as the Debtor's counsel. Beacon
disclosed assets of $72 million and debt totaling $47 million,
including a $39.1 million loan guaranteed by the U.S. Energy
Department. Beacon built a $69 million facility with 20 megawatts
of balancing capacity in Stephentown, New York, funded mostly by
the DoE loan.
The Debtors tapped Miller Wachman, LLP as auditors, Pluritas, LLC
as intellectual property advisors, CRG Partners Group LLC as
financial advisors.
Beacon Power is the second cleantech company which has been backed
by the U.S. Department of Energy via loan guarantees to fail this
year. The first was Solyndra, which declared Chapter 11
bankruptcy on Sept. 6, 2011.
Roberta A. DeAngelis, the United States Trustee for Region 3,
appointed four unsecured creditors to serve on the Official
Committee of Unsecured Creditors of Beacon Power Corporation.
Affiliates that simultaneously sought Chapter 11 protection are
Stephentown Holding LLC (Bankr. D. Del. Case No. 11-13451) and
Stephentown Regulation Services LLC (Bankr. D. Del. Case No.
11-13452).
BEACON POWER: Says Plan Remains Possible After Auction
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Beacon Power Corp. is seeking a three-month extension
of the exclusive right to propose a Chapter 11 plan. The assets
were scheduled for auction last week, in advance of a hearing
Feb. 7 for approval of sale. The so-called exclusivity motion
didn't give a hint about the degree of interest in the auction.
Beacon only says there is a "reasonable prospect for a plan" once
the assets are sold. Unsuccessfully attempting to delay the
auction, the creditors' committee previously said a quick sale
would "offer little or nothing to unsecured creditors." There
will be a Feb. 22 hearing to consider the exclusivity motion.
About Beacon Power
Tyngsboro, Mass.-based Beacon Power Corporation (Nasdaq: BCOND)
-- http://www.beaconpower.com/-- designs, manufactures and
operates flywheel-based energy storage systems that it has begun
to deploy in company-owned merchant plants that sell frequency
regulation services in open-bid markets.
Beacon Power filed for Chapter 11 protection on Oct. 30, 2011, in
Delaware (Bankr. D. Del. Case No. 11-13450). Brown Rudnick and
Potter Anderson & Corroon serve as the Debtor's counsel. Beacon
disclosed assets of $72 million and debt totaling $47 million,
including a $39.1 million loan guaranteed by the U.S. Energy
Department. Beacon built a $69 million facility with 20 megawatts
of balancing capacity in Stephentown, New York, funded mostly by
the DoE loan.
The Debtors tapped Miller Wachman LLP as auditors, Pluritas LLC as
intellectual property advisors, CRG Partners Group LLC as
financial advisors.
Beacon Power is the second cleantech company which has been backed
by the U.S. Department of Energy via loan guarantees to fail this
year. The first was Solyndra, which declared Chapter 11
bankruptcy on Sept. 6, 2011.
Roberta A. DeAngelis, the United States Trustee for Region 3,
appointed four unsecured creditors to serve on the Official
Committee of Unsecured Creditors of Beacon Power Corporation.
Affiliates that simultaneously sought Chapter 11 protection are
Stephentown Holding LLC (Bankr. D. Del. Case No. 11-13451) and
Stephentown Regulation Services LLC (Bankr. D. Del. Case No.
11-13452).
BIOSCRIP INC: Moody's Says 'B3' CFR Unaffected by Asset Sale
------------------------------------------------------------
Moody's Investors Service said that BioScrip, Inc.'s announcement
that it signed a definitive agreement to sell certain assets of
its community specialty pharmacies and centralized specialty and
mail service pharmacy businesses to Walgreens Co. is an overall
credit positive. However Moody's sees no immediate impact on the
company's B3 Corporate Family Rating.
Based in Elmsford, New York, BioScrip, Inc. is a national provider
of pharmacy and home health services to patients with chronic
diseases. For the twelve months ended September 30, 2011, the
company generated total revenues of approximately $1.8 billion.
BIOZONE PHARMACEUTICALS: Board Dismisses Daniel Fisher
------------------------------------------------------
The Board of Directors of Biozone Pharmaceuticals, Inc., removed
Daniel Fisher from the Board and from his position as the
Company's Executive Vice President.
About Biozone Pharmaceuticals
Biozone Pharmaceuticals, Inc., formerly, International Surf
Resorts, Inc., was incorporated under the laws of the State of
Nevada on Dec. 4, 2006, to operate as an internet-based provider
of international surf resorts, camps and guided surf tours. The
Company proposed to engage in the business of vacation real estate
and rentals related to its surf business and it owns the website
isurfresorts.com. During late February 2011, the Company began to
explore alternatives to its original business plan. On Feb. 22,
2011, the prior officers and directors resigned from their
positions and the Company appointed a new President, Director,
principal accounting officer and treasurer and began to pursue
opportunities in medical and pharmaceutical technologies and
products. On March 1, 2011, the Company changed its name to
Biozone Pharmaceuticals, Inc.
Since March 2011, the Company has been engaged primarily in
seeking opportunities related to its intention to engage in
medical and pharmaceutical businesses. On May 16, 2011, the
Company acquired substantially all of the assets and assumed all
of the liabilities of Aero Pharmaceuticals, Inc., pursuant to an
Asset Purchase Agreement dated as of that date. Aero manufactures
markets and distributes a line of dermatological products under
the trade name of Baker Cummins Dermatologicals.
On June 30, 2011, the Company acquired the Biozone Labs Group
which operates as a developer, manufacturer, and marketer of over-
the-counter drugs and preparations, cosmetics, and nutritional
supplements on behalf of health care product marketing companies
and national retailers.
BioZone as of Oct. 29, 2011, is in default with respect to eleven
senior secured convertible promissory notes issued to various
accredited investors with an aggregate principal amount of
$2,250,000 due to the fact that the Company has not paid the
amount due on maturity.
The Company's balance sheet at Sept. 30, 2011, showed
$10.70 million in total assets, $10.88 million in total
liabilities, and a $177,712 total shareholders' deficiency.
"Our current balances of cash will not meet our working capital
and capital expenditure needs for the next twelve months. In
addition, as of September 30, 2011, we have a shareholder
deficiency of $177,712 and negative working capital of $1,740,163.
Because we are not currently generating sufficient cash to fund
our operations and we have debt that is in default, we may need to
rely on external financing to meet future operating, debt
repayment and capital requirements. These conditions raise
substantial doubt about our ability to continue as a going
concern."
BMF, INC.: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: BMF, Inc.
Carr. 798 Km 0.6
Barrio Rio Canas
Caguas, PR 00725
Bankruptcy Case No.: 12-00658
Chapter 11 Petition Date: January 31, 2012
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOC.
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: (787) 729-2900
Fax: (787) 729-2203
E-mail: notices@condelaw.com
Scheduled Assets: $12,262,338
Scheduled Liabilities: $8,905,292
The petition was signed by Luis O. Mayendia Blanco, general
manager.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Alpla Caribe -- $831,784
P.O. Box 2907
Guayama, PR 00785
Crim -- $372,428
P.O. Box 195387
San Juan, PR 00919-5387
Internal Revenue Services -- $145,780
P.O. Box 7346
Philadelphia, PA 19101-7346
Autoridad de Energia Electrica -- $120,115
Department of Treasury -- $78,934
Fondo del Seguro del Estado -- $45,747
Municipality of Caguas -- $43,856
Central Produce El Jibarito -- $42,954
Pac Tech International -- $36,099
CWP Corporation -- $30,338
Labels Unlimited Inc. -- $27,021
Departamento de Recursos -- $26,576
Pedro Davila -- $19,514
Caribe Industrial -- $15,385
JL Water Consultant -- $12,055
Roberts Security Services -- $10,040
Business Technical Services -- $9,694
Graphic Labels Inc. -- $9,335
IFCO Recycling Inc. -- $8,460
Fedex -- $8,099
BOOZ ALLEN: Moody's Says Recurring Dividend No Effect on Ba3 CFR
----------------------------------------------------------------
Moody's Investors Service said Booz Allen Hamilton Inc.'s (Booz
Allen) announcement that its board authorized a recurring common
dividend will not affect the company's Ba3 corporate family rating
or positive outlook. Booz Allen's speculative grade liquidity
rating (SGL) remains SGL-1 reflecting very good liquidity.
These summarizes the current ratings:
Corporate family rating at Ba3
Probability of default rating at Ba3
$275 million senior secured revolving credit facility due 2014 at
Ba2 (LGD-3, 35%)
$500 million senior secured term loan A due 2016 at Ba2 (LGD-3,
35%)
$500 million senior secured term loan B due 2017 at Ba2 (LGD-3,
35%)
The principal methodology used in rating Booz Allen Hamilton Inc.
was the Global Aerospace and Defense Methodology, published June
2010. Other methodologies used include Loss Given Default for
Speculative Grade Issuers in the US, Canada, and EMEA, published
June 2009.
Booz Allen Hamilton is a provider of management and technology
consulting services to the U.S. government in the defense,
intelligence and civil markets. Booz Allen is headquartered in
McLean, Virginia, and had revenue of approximately $5.8 billion
for the last twelve month period ended December 31, 2011.
BOSQUE VERDE: Case Summary & 13 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Bosque Verde Investment, Corp.
P.O. Box 506
Isabela, PR 00662
Bankruptcy Case No.: 12-00765
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Enrique M Almeida Bernal, Esq.
ALMEIDA & DAVILA PSC
P.O. Box 191757
San Juan, PR 00919-1757
Tel: (787) 722-2500
Fax: (787) 722-2227
E-mail: ealmeida@almeidadavila.com
Scheduled Assets: $5,177,195
Scheduled Liabilities: $4,117,870
A list of the Company's 13 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/prb12-00765.pdf
The petition was signed by Manuel Martinez Maldonado, president.
BRIXMOR LLC: Fitch Upgrades Issuer Default Rating to 'BB-'
----------------------------------------------------------
Fitch Ratings has upgraded the credit ratings of Brixmor LLC as
follows:
-- Issuer Default Rating (IDR) to 'BB-' from 'CCC';
-- Senior unsecured notes to 'BB-' from 'CCC/RR4'.
The Rating Watch Evolving has been removed. Fitch has assigned a
Stable Rating Outlook.
The rating actions are driven by the improved credit profile of
Brixmor LLC, (Brixmor) subsequent to its acquisition by an
affiliate of The Blackstone Group LP (IDR 'A+'; Outlook Stable by
Fitch), and certain associated financing transactions. As a
result of the financing transactions and removal of debt
guarantees highlighted below, leverage is low for the 'BB-'
rating. The ratings are also supported by a laddered debt
maturity schedule, a large, diversified portfolio of grocery
anchored shopping centers, and a well-capitalized sponsor.
Net debt to recurring operating EBITDA was 7.9 times (x) at Sept.
30, 2011, based on annualized 3Q'11 recurring operating EBITDA,
which is strong for the rating. Fitch estimates that leverage for
Brixmor Property Group (BPG), Brixmor LLC's ultimate parent was
9.0x as of Sept. 30, 2011, based on annualized 3Q'11 EBITDA.
Per Fitch's criteria report, 'Parent and Subsidiary Rating
Linkage', dated Aug. 12, 2011, there is a parent-subsidiary
relationship between BPG and Brixmor LLC due to strong operational
ties, but weak legal ties. Fitch focuses on the credit profile of
the stand-alone Brixmor LLC entity while also monitoring the
credit profile of BPG. Cash is essentially fungible across BPG
and its three primary subsidiaries; therefore, Fitch views no
significant difference in the credit profiles of Brixmor LLC and
BPG.
Brixmor's debt maturity schedule improved significantly subsequent
to the transaction, as $2.3 billion of short-term debt within the
BPG platform was repaid, including the $1.65 billion Super Bridge
loan (which also eliminated a $100 million mortgage guarantee by
Brixmor), $14 million of mortgage debt secured by four assets
within Brixmor, and $575 million of mortgage debt within the
Residual Joint Venture (Residual). As such, there are no
remaining debt guarantees or cross default provisions relating to
Brixmor LLC. New financings include $1.4 billion of mortgage debt
due in 2016 within Residual, and $80 million of mortgage debt
within Brixmor LLC due in 2013, but with three one-year extension
options. Due to the repayment of short-term debt and the new
longer-term financings, the debt maturity schedule is manageable,
with only 10% and 12% maturing in 2012 and 2013, respectively, for
Brixmor on a stand alone basis. Fitch estimates that these
percentages are similar when including the JV debt as well.
Further supporting the ratings is a well diversified portfolio of
585 grocery anchored shopping centers consisting of 92 million
square feet across 39 states across the BPG platform. The BPG
portfolio contains over 4,000 national, regional and local tenants
and the largest tenant represents just 3.3% of annualized base
revenue (ABR). The top ten tenants represent just 17.2% of ABR,
limiting individual tenant risk.
The ratings are partially offset by low fixed charge coverage, low
unencumbered asset coverage of unsecured debt, and a moderate
liquidity shortfall on a standalone basis.
Brixmor's fixed charge coverage, calculated as recurring operating
EBITDA less straight line rents, amortization of below market
leases and recurring capital expenditures divided by total
interest expense was 1.4x for 3Q'11, but is expected to decline to
1.2x in 2012 due to increased recurring capital expenditures,
which is low for the rating. Fitch estimates that fixed charge
coverage for BPG was approximately 1.4x in 3Q'11.
Brixmor's unencumbered asset coverage of unsecured debt based on
annualized recurring 3Q'11 EBITDA and applying an 8.5%
capitalization rate (cap rate) was low for the 'BB-' IDR, as many
unencumbered assets were transferred to affiliated JV's by
Brixmor's previous parent entity.
Brixmor has a liquidity shortfall on a standalone basis for the
period Oct. 1, 2011 through Dec. 31, 2013, as total sources of
liquidity (unrestricted cash and projected cash flows from
operations) less total uses of liquidity (debt maturities and
recurring capital expenditures) result in a $225 million
shortfall, or a liquidity coverage ratio of 0.6x. Assuming that
the company is able to refinance 80% of secured debt, liquidity
coverage would be 0.9x. Further, Brixmor does not have an
unsecured revolving line of credit, limiting its liquidity.
The Stable Rating Outlook is driven by overall moderating retail
real estate fundamentals supported by Brixmor's financial
flexibility to aggressively lease up the portfolio, partially
offset by high expected capital expenditures that will mute credit
metric improvement in the near term.
The following factors may have a positive impact on the rating
and/or Rating Outlook:
-- Improving unencumbered asset coverage of unsecured debt;
-- Fixed charge coverage sustaining above 1.5x;
-- Leverage sustaining below 7.0x;
-- A sustained liquidity surplus.
The following factors may have a negative impact on the rating
and/or Rating Outlook:
-- Declining unencumbered asset coverage of unsecured debt;
-- Fixed charge coverage sustaining below 1.3x;
-- Leverage sustaining above 8.5x.
CAESARS ENTERTAINMENT: Bank Debt Trades at 14% Off
--------------------------------------------------
Participations in a syndicated loan under which Caesars
Entertainment, formerly known as Harrah's Entertainment Inc., is a
borrower traded in the secondary market at 86.04 cents-on-the-
dollar during the week ended Friday, Feb. 3, 2012, an increase of
2.21 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 425 basis points above LIBOR to borrow
under the facility. The bank loan matures on Jan. 28, 2018, and
carries Moody's B3 rating and Standard & Poor's B rating. The
loan is one of the biggest gainers and losers among 168 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
-- http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
The Company also reported a net loss of $471.30 million on $6.66
billion of net revenues for the nine months ended Sept. 30, 2011,
compared with a net loss of $629.30 million on $6.69 billion of
net revenues for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $28.86
billion in total assets, $27.62 billion in total liabilities, $36
million in redeemable non-controlling interests, and $1.20 billion
total stockholders' equity.
* * *
Harrah's announced its re-branding to Caesar's on mid-November
2010. Harrah's carries 'Caa3' long term corporate family and
probability of default ratings, with 'positive' outlook, from
Moody's Investors Service. It has a 'B-' issuer credit rating,
with 'stable' outlook, from Standard & Poor's.
"The 'B-' corporate credit rating reflects Caesars' very weak
credit measures and our belief that prospects for a meaningful
rebound in net revenues and EBITDA in 2011 do not seem promising
given the current economic outlook," said Standard & Poor's credit
analyst Ben Bubeck in May 2011. "While several actions taken by
management have positioned the company with a moderate covenant
cushion and very limited debt maturities over the next few years,
Caesars' capacity to continue to fund operational and capital
spending needs and meet debt service obligations relies on
meaningful growth in cash flow generation over the next few
years."
As reported by the TCR on March 3, 2011, Moody's Investors Service
upgraded Caesars Entertainment's Corporate Family ratings and
Probability of Default ratings to Caa2. CET's Caa2 Corporate
Family Ratings reflect very high leverage, weak interest coverage,
the company's debt financed growth strategy, and Moody's view that
the company's current capital structure in unsustainable in the
long-term. The ratings reflect Moody's expectation that gaming
demand will rebound very slowly over the next several years.
However, in the absence of a material de-leveraging transaction,
Moody's do not expect the company's capital structure to improve
materially over the next few years. Additionally, given CEC's
weak credit profile, there is a possibility that the company could
again pursue transactions that will result in impairment of debt
holder claims as a means to improve its capital structure.
CAGLE'S INC: Seeks June 2012 Extension of Plan Exclusivity Period
-----------------------------------------------------------------
Cagle Inc.'s and Cagle's Farms ask the U.S. Bankruptcy Court to
extend the exclusivity periods during which only the Debtors may
file and solicit acceptances of a plan of reorganization.
The Debtors have an initial 120 days from the bankruptcy filing
date -- through Feb. 16, 2012 -- within which they have the
exclusive right to file a plan and 180 days -- through April 16,
2012 -- within which they have the exclusive right to solicit plan
votes.
The Debtors request to extend the exclusivity periods to June 15,
2012, and Aug. 14, 2012, respectively.
As reported in the Troubled Company Reporter on Jan. 13, 2012, the
official creditors' committee and the U.S. Trustee have filed
opposition to Cagle's proposal to implement a $250,000 bonus
program. The U.S. Trustee said there is a "very real possibility"
the company is "administratively insolvent," meaning it won't be
able to pay debt that arose after the Chapter 11 filing in
October.
About Cagle's
Cagle's Farms (NYSE: CGL.A) -- http://www.cagles.net/-- engages
in the production, marketing, and distribution of fresh and frozen
poultry products in the United States.
Cagle's Inc. and its wholly owned subsidiary Cagle's Farms filed
on Oct. 19, 2011, voluntary petitions for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 11-80202 and
11-80203). Paul K. Ferdinands, Esq., at King & Spalding, in
Atlanta, Georgia, serves as counsel. FTI Consulting, Inc., serves
as the Debtors' financial advisors. Kurtzman Carson LLC serves as
their claims, noticing, and balloting agent. Cagle's Inc.
estimated assets of up to $100 million and debts of up to
$50 million. Cagle's Farms estimated assets and debts of up to
$50 million.
In its schedules, Cagle's Inc. disclosed $81,998,077 in assets and
$55,304,599 in liabilities as of the Petition Date.
The Official Committee of Unsecured Creditors is represented by
McKenna Long & Aldridge LLP as local counsel, and Lowenstein
Sandler's Bankruptcy and Creditors' Rights Group as counsel. J.H.
Cohn LLP serves as its financial advisors.
No trustee or examiner has been appointed in the Debtors'
bankruptcy cases.
CANO PETROLEUM: Reports $1.3 Million Net Income in Sept. 30 Qtr.
----------------------------------------------------------------
Cano Petroleum, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q, reporting net income
of $1.27 million on $5.66 million of total operating revenues for
the three months ended Sept. 30, 2011, compared with a net loss of
$4.56 million on $6.24 million of total operating revenues for the
same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$63.37 million in total assets, $116.25 million in total
liabilities, and a $52.88 million total stockholders' deficit.
The Company reported a net loss of $185.70 million on
$26.12 million of total operating revenues for the year ended
June 30, 2011, compared with a net loss of $11.54 million on
$22.85 million of total operating revenues during the prior year.
"Due to our current financial condition, including a history of
continued losses, defaults under our loan agreements and our
Series D Preferred Stock, no available borrowing capacity,
constrained cash flow and negative working capital, and limited to
no access to additional capital, there is substantial doubt about
our ability to continue as a going concern."
Hein & Associates LLP, in Dallas, Texas, noted that the Company
has suffered recurring losses from operations and has a net
capital deficiency that raise substantial doubt about its ability
to continue as a going concern.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/yQPacJ
About Cano Petroleum
Cano Petroleum, Inc., is an independent Texas-based energy
producer with properties in the mid-continent region of the United
States. Cano's primary focus is on increasing domestic production
from proven fields using enhanced recovery methods. Cano trades
on the NYSE Amex Stock Exchange under the ticker symbol CFW.
Bankruptcy Warning
In the past, the Company's strategy had been to convert its
estimated proved undeveloped reserves into proved producing
reserves, improve operational efficiencies in its existing
properties and acquire accretive proved producing assets suitable
for secondary and enhanced oil recovery at low cost. Due to the
Company's current financial constraints, including continued
losses, defaults under the Company's loan agreements and the
Company's Series D Preferred Stock, no available borrowing
capacity, constrained cash flow, negative working capital, and
limited to no other capital availability, the Company is reviewing
strategic alternatives which include the sale of the Company, the
sale of some or all of the Company's existing oil and gas
properties and assets, potential business combinations, debt
restructuring, including recapitalizing the Company, and
bankruptcy. The Company continues to focus on cash management and
cost reduction efforts to improve both its cash flow from
operations and profitability.
CELEBRITY CONTRACTORS: Case Summary & 3 Largest Unsec Creditors
---------------------------------------------------------------
Debtor: Celebrity Contractors, Inc.
2933 St. Claude Avenue
New Orleans, LA 70117
Bankruptcy Case No.: 12-10281
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Eastern District of Louisiana (New Orleans)
Judge: Jerry A. Brown
Debtor's Counsel: Robert L. Marrero, Esq.
ROBERT MARRERO, LLC
3520 General DeGaulle Drive, Suite 1035
New Orleans, LA 70114
Tel: (504) 366-8025
Fax: (504) 366-8026
E-mail: marrero1035@bellsouth.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's three largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/laeb12-10281.pdf
The petition was signed by Gregory Huskey, office/director.
Affiliates that filed separate Chapter 11 petitions:
Petition
Debtor Case No. Date
------ -------- ----
Gregory Huskey 10-14566 12/14/2010
Celebrity Real Estate Investment Inc. 11-11593 05/18/2011
CENTRAL FALLS: Governor Seeks $400K More for Receiver, Legal Fees
-----------------------------------------------------------------
American Bankruptcy Institute reports that Rhode Island State
Revenue Director Rosemary Booth Gallogly said that a supplemental
budget request released on Tuesday by Rhode Island Gov. Lincoln
Chafee (I) includes $392,000 in funds for the salary of the state-
appointed receiver and attorneys' fees to several firms.
About Central Falls
Central Falls is a city in Providence County, Rhode Island. The
population was 18,928 at the 2000 census. Central Falls is the
smallest and most densely populated city in Rhode Island.
Central Falls sought bankruptcy protection under Chapter 9 of the
U.S. Bankruptcy Code (Bankr. D. R.I. Case No. 11-13105) on Aug. 1,
2011. The Chapter 9 filing was made after former Rhode Island
Supreme Court Judge Robert Flanders, who serves as state-appointed
receiver for the city, was unable to negotiate significant
concessions from unions representing police officers, firefighters
and other city workers. The city grappled with an $80 million
unfunded pension and retiree health benefit liability that is
nearly quadruple its annual budget of $17 million. Judge Robert
Flanders succeeded the role from retired Superior Court Associate
Justice Mark A. Pfeiffer, who was appointed in July 2010. The
Central Falls receivership, the state's first, has left the mayor
and council without any power to govern.
Judge Frank Bailey presides over the Chapter 9 case. Theodore
Orson, Esq., at Orson and Brusini Ltd., serves as bankruptcy
counsel to the receiver.
The receiver is negotiating new contracts with unions representing
city workers. The receiver filed a proposed debt adjustment plan
for the city in September. It won't affect bondholders.
CENTRAL FEDERAL: Amends 30 Million Common Shares Offering
---------------------------------------------------------
Central Federal Corporation filed with the U.S. Securities and
Exchange Commission amendment no. 2 to Form S-1 registration
statement relating to the Company's offer of 30 million shares of
common stock including up to 24,965,000 Shares of Common Stock
issuable upon the exercise of Subscription Rights at $1.00 per
share and warrants to purchase up to 10,000,000 shares of common
stock.
At the minimum of the offering, the Company expects to contribute
funds to its subsidiary, CFBank, to enable it to exceed all of its
regulatory capital requirements, including the higher capital
requirements imposed by the CFBank Cease and Desist Order
described later in this prospectus, to be considered "well
capitalized."
The Company has separately entered into standby purchase
agreements with certain standby purchasers. Pursuant to the
standby purchase agreements, the Standby Purchasers have agreed to
acquire from the Company, at the subscription price of $1.00 per
share, a total of 5,035,000 shares of common stock. The Standby
Purchasers have conditioned their purchase of shares of common
stock upon the receipt by Central Federal Corporation, referred to
as CFC, of $16.5 million in net proceeds from the rights offering
and the public offering, if any. As a result, the purchase by the
Standby Purchasers (5,035,000 shares of common stock) is
conditioned on the sale by CFC of 17,465,000 shares in the rights
offering and the public offering, if any. Although the 5,035,000
shares subscribed for by the Standby Purchasers are included in
the registration statement of which this prospectus forms a part,
the shares subscribed for by the Standby Purchasers are in
addition to the up to 24,965,000 shares offered in the rights
offering and the public offering, if any. The aggregate maximum
number of shares that may be sold in the rights offering, any
public offering and to the Standby Purchasers is 30,000,000.
The Company's common stock is traded on Nasdaq under the trading
symbol "CFBK."
A full-text copy of the amended prospectus is available for free
at http://is.gd/uBJB8C
About Central Federal
Fairlawn, Ohio-based Central Federal Corporation (Nasdaq: CFBK) is
the holding company for CFBank, a federally chartered savings
association formed in Ohio in 1892. CFBank has four full-service
banking offices in Fairlawn, Calcutta, Wellsville and Worthington,
Ohio.
The Company's balance sheet at Sept. 30, 2011, showed
$265.4 million in total assets, $254.0 million in total
liabilities, and stockholders' equity of $11.4 million.
Regulatory Matters
On May 25, 2011, Central Federal Corporation and CFBank each
consented to the issuance of an Order to Cease and Desist (the
Holding Company Order and the CFBank Order, respectively, and
collectively, the Orders) by the Office of Thrift Supervision
(OTS), the primary regulator of the Holding Company and CFBank at
the time the Orders were issued.
The Holding Company Order requires it, among other things, to: (i)
submit by June 30, 2011, a capital plan to regulators that
establishes a minimum tangible capital ratio commensurate with the
Holding Company's consolidated risk profile, reduces the risk from
current debt levels and addresses the Holding Company's cash flow
needs; (ii) not pay cash dividends, redeem stock or make any other
capital distributions without prior regulatory approval; (iii) not
pay interest or principal on any debt or increase any Holding
Company debt or guarantee the debt of any entity without prior
regulatory approval; (iv) obtain prior regulatory approval for
changes in directors and senior executive officers; and (v) not
enter into any new contractual arrangement related to compensation
or benefits with any director or senior executive officer without
prior notification to regulators.
The CFBank Order required CFBank to have by Sept. 30, 2011, and
maintain thereafter, 8% Tier 1 (Core) Capital to adjusted total
assets and 12% Total Capital to risk weighted assets. CFBank will
not be considered well-capitalized as long as it is subject to
individual minimum capital requirements.
CFBank did not comply with the higher capital ratio requirements
by the Sept. 30, 2011 required date.
CHAMPION INDUSTRIES: Talks Restructuring Under Forbearance
----------------------------------------------------------
Dow Jones' DBR Small Cap reports that Champion Industries Inc. is
operating under a forbearance agreement that expires on April 30
while it works out a restructuring plan with lenders and advisers,
according to a regulatory filing.
As reported in the Troubled Company Reporter on Jan. 5, 2012,
Fifth Third Bank, as Administrative Agent under a Credit Agreement
dated Sept. 14, 2007, the Lenders, Champion Industries, Inc., all
its subsidiaries and Marshall T. Reynolds entered into a Limited
Forbearance Agreement and Third Amendment to Credit Agreement
which provides, among other things, that during a forbearance
period commencing on Dec. 28, 2011, and ending on April 30, 2012,
the Required Lenders are willing to temporarily forbear exercising
certain rights and remedies available to them, including
acceleration of the obligations or enforcement of any of the liens
provided for in the Credit Agreement. Champion acknowledged in
the Forbearance Agreement that as a result of the existing
defaults, the Lenders are entitled to decline to provide further
credit to Champion, to terminate their loan commitments, to
accelerate the outstanding loans, and to enforce their liens.
About Champion Industries
Champion Industries, Inc., is a commercial printer, business forms
manufacturer and office products and office furniture supplier in
regional markets in the United States. The Company also publishes
The Herald-Dispatch daily newspaper in Huntington, WV. The
Company's sales force sells printing services, business forms
management services, office products, office furniture and
newspaper advertising. Its subsidiaries include Interform
Corporation, Blue Ridge, Champion Publishing, Inc., The Dallas
Printing, The Bourque Printing, The Capitol, and The Herald-
Dispatch.
CHRIST HOSPITAL: Files for Bankruptcy After Prime Axed Sale Deal
----------------------------------------------------------------
Christ Hospital said on Feb. 2, 2012, the hospital's board of
trustees unanimously approved the filing of Chapter 11
reorganization -- if necessary -- in order to maintain financial
stability and to preserve its commitment to its patients.
According to the report, Prime Healthcare withdrew a purchase
asset agreement with Christ Hospital that prompted the meeting.
The Hospital said the reorganization would ensure that it
continues to serve the community as an acute care facility in
Hudson County, New Jersey.
Melanie Evans at ModernHealthcare.com reports that Christ
Hospital's losses accelerated in 2009 compared with the prior
year, the most recent financial figures available from tax
filings. The Hospital reported a loss of $18.3 million on revenue
of $144.1 million for the year that ended Dec. 31, 2009, compared
with a loss of $4 million on revenue of $175.8 million the year
before.
Ms. Evans says Prime, which last summer offered $35 million for
the not-for-profit Christ Hospital, was outbid in recent months by
another for-profit hospital operator.
Christ Hospital -- www.christhopsital.org -- provides healthcare
services in New Jersey.
CLEAN HARBOR: Moody's Upgrades CFR to Ba2; Outlook Stable
---------------------------------------------------------
Moody's Investors Service has upgraded the ratings of Clean
Harbors, Inc. The corporate family rating has been raised to Ba2
from Ba3 and the rating outlook is stable. The ratings upgrade
reflects Clean Harbors' rising scale and diversity as a hazardous
waste disposal and environmental services business and Moody's
view that a favorable outlook for North American oil production
and a gradually improving U.S. economy through 2013 should
continue the company's good credit metrics.
RATINGS RATIONALE
The favorable operating environment that Moody's anticipates
should help Clean Harbors meet its high capital spending plan
across 2012, while maintaining debt to EBITDA at or below 3x and
free cash flow to debt in the mid-single digit percentage range
(Moody's adjusted basis). A disciplined financial policy should
continue?one that is characterized by reasonable price multiples
paid on acquisitions and a willingness to partially fund larger
acquisitions with equity. Much fragmentation exists in the
environmental services industry where customers are numerous and
players can specialize by equipment, region or waste type. The
company's growing portfolio of services businesses is boosting
cross-selling synergies and bodes well for utilization rates of
Clean Harbors' most lucrative assets: its incinerators, transfer
stations and landfills. High permit costs of hazardous waste
disposal assets and limited supply of such facilities in the
market, should keep U.S./Canadian disposal pricing at favorable
levels.
The credit profile features several constraining factors that
support the stable outlook. Although the company's asset base has
evolved, returns have not risen much over the past few years and
revenues have become more tied to oil market spot prices (about
25% on an annualized basis stem from exploration/production
activity levels). Better integration of the company's expanded
businesses will likely be required to reduce fixed costs, raise
returns and make margins more durable to stress. Moody's thinks
the company is appropriately focused on achieving these cost
synergies. But realization will take time, especially in light of
high near-term demand, from energy sector exploration and
production activity within the company's western Canada (oil
sands) and U.S. (shall gas) markets. As the pace of acquisition
and growth capital spending continues, integration related risks
will remain pronounced. Some potential for a transformational
acquisition, such as the $+400 million Eveready acquisition of
2009, also exists as the company seeks to penetrate new hazardous
waste market segments and to broaden its geographic footprint.
Better revenue diversity across the waste stream, such as less
concentration on oil and gas exploration and production markets,
would be needed to achieve a higher rating. Expectation of debt to
EBITDA sustained in the 2.5x range and free cash flow to debt at
+10% would also accompany a higher rating. Rating pressure would
grow with debt to EBITDA approaching 4x, EBITDA margins below 15%,
or a lack of consistent free cash flow generation. Should free
cash flow not be re-invested into the business and instead put
toward shareholder rewards the ratings/outlook could be revised
down.
Ratings are:
Corporate family, to Ba2 from Ba3
Probability of default, to Ba2 from Ba3
$520 million senior secured notes due 2016, to Ba2, LGD3, 41% from
Ba3, LGD3, 43%
Speculative grade liquidity, affirmed at SGL-2
Outlook, Stable
The principal methodology used in rating Clean Harbors was the
Global Business & Consumer Service Industry Methodology published
in October 2010. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
Clean Harbors, Inc., headquartered in Norwell, Massachusetts, is a
provider of environmental services and a leading operator of non-
nuclear hazardous waste treatment facilities in North America.
Revenues for the twelve months ended September 31, 2011 were $1.9
billion.
CLEAR CHANNEL: Bank Debt Trades at 20% Off in Secondary Market
--------------------------------------------------------------
Participations in a syndicated loan under which Clear Channel
Communications, Inc., is a borrower traded in the secondary market
at 80.22 cents-on-the-dollar during the week ended Friday, Feb. 3,
2012, an increase of 1.33 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 168 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About CC Media and Clear Channel
San Antonio, Texas-based CC Media Holdings, Inc. (OTC BB: CCMO) --
http://www.ccmediaholdings.com/-- is the parent company of Clear
Channel Communications, Inc. CC Media Holdings is a global media
and entertainment company specializing in mobile and on-demand
entertainment and information services for local communities and
premier opportunities for advertisers. The Company's businesses
include radio and outdoor displays.
CC Media has three reportable business segments: Radio
Broadcasting; Americas Outdoor Advertising; and International
Outdoor Advertising. Approximately half of CC Media's revenue is
generated from its Radio Broadcasting segment.
The Company's balance sheet at Sept. 30, 2011, showed $16.51
billion in total assets, $23.96 billion in total liabilities and a
$7.45 billion total member's deficit.
As reported by the Troubled Company Reporter on Dec. 16, 2011,
Standard & Poor's revised its rating outlook on CC Media Holdings
Inc., and Clear Channel, which S&P views on consolidated basis, to
negative from positive. "We affirmed our ratings on the company,
including the corporate credit rating of 'CCC+'," S&P said.
"The outlook revision reflects our view that softening ad demand
and global economic uncertainty could slow the pace of revenue
growth at CC Media over the intermediate term, heightening
refinancing risk around its 2014 and 2016 debt maturities,"
explained Standard & Poor's credit analyst Michael Altberg. "The
'CCC+' corporate credit rating reflects the risks surrounding the
longer-term viability of the company's capital structure in
particular, refinancing risk relating to sizable secured and
unsecured debt maturities in 2014 ($2.9 billion) and 2016 ($12.3
billion). We view CC Media's financial risk profile as 'highly
leveraged' (based on our criteria), given the company's
significant refinancing risk, very slim EBITDA coverage of
interest expense, and minimal discretionary cash flow compared to
its debt burden. In our view, the company has a 'fair' business
risk profile, because of its position as the largest U.S. radio
and global outdoor advertising operator," S&P said.
C.M. MEIER: To be Sold by Chapter 11 Trustee at Auction
-------------------------------------------------------
C.M. Meiers Co. Inc. was scheduled to be sold at an auction
Friday, Feb. 3, Insurance Journal reports.
According to the report, the firm has been up for sale for some
time, but worsening financial conditions has sped up the process.
The report says Bradley D. Sharp was appointed the trustee on
Jan. 23, 2012. He's selling right, title and interest to the
assets of the brokerage, which includes accounts receivable, the
brokerage's book of business, its name, phone numbers and other
intangibles, as well as tangibles like computers and office
furniture.
The report notes that the minimum bid has been set at $750,000,
but that includes the assumption of liabilities and the cash
purchase price. The report also Affinity Global was to serve as
stalking horse bidder. Mr. Sharp declined to offer details of
Affinity's bid.
The report says final bids were due Feb. 2. The auction was to
take place at the United States Bankruptcy Court Central District
of California San Fernando Valley Division courthouse in
California.
Based in Woodland Hills, California, C.M. Meiers Co. Inc. --
http://www.cmmeiers.com/-- operates an insurance company in
California. C.M. Meiers, which does business as CMM of Texas and
Integrated Benefit Consultants, filed for Chapter 11 bankruptcy
(Bankr. C.D. Calif. Case No. 12-10229) on Jan. 9, 2012. Judge
Maureen Tighe presides over the case. Elaine Nguyen, Esq., at
Weintraub & Selth APC, serves as the Debtor's counsel. In its
petition, the Debtor estimated $1 million to $10 million in assets
and debts. The petition was signed by Eric Rothman, vice
president.
CNO FINANCIAL: Fitch Lifts Rating on $293-Mil. Notes to 'B+'
------------------------------------------------------------
Fitch Ratings has upgraded the ratings assigned to CNO Financial
Group, Inc. (CNO Financial) and its core insurance subsidiaries.
The ratings on CNO Financial's senior secured debt issue and
Conseco Life Insurance Company remain unchanged. The Rating
Outlook is Stable.
Today's rating action reflects CNO Financial's improved capital
position, earnings profile, and financial flexibility.
Statutory capitalization at the company's insurance subsidiaries
continues to improve. CNO Financial estimates its combined NAIC
risk-based capital (RBC) was 359% at Sept. 30, 2011, a 27 point
improvement from year-end 2010. Operating leverage of
approximately 13.6 times (x) at Sept. 30, 2011 also improved from
14.1x at year-end 2010. Total adjusted capital (TAC) was $1.7
billion at Sept. 30, 2011. Fitch believes the company will
continue to make incremental improvements in capital as it
continues to generate good statutory earnings.
CNO Financial's financial leverage was approximately 17% at Sept.
30, 2011 which is below Fitch's expectation for the current rating
level. In addition, the company's total financings and
commitments (TFC) ratio was moderate at 0.5x. Leverage is also
expected to increase moderately as CNO Financial adopts an
accounting change for deferred acquisition costs in 2012.
CNO Financial's operating earnings have stabilized and investment
losses have moderated as the company has now produced positive
quarterly net income for nearly three years. GAAP earnings before
interest and taxes increased 8% to $306 million through the first
nine months of 2011.
Fitch expects the GAAP interest coverage ratio to be in the 5x
range in 2012 after reaching 4.8x for the first nine months of
2011.
CNO Financial demonstrated improved financial flexibility by
amending the terms of its senior secured bank credit facility in
2011. These changes eased certain covenant restrictions and
lowered borrowing costs. In addition, CNO Financial and its non-
insurance subsidiaries held unrestricted cash of $169 million at
Sept. 30, 2011.
CNO Financial's Issuer Default Rating (IDR) and senior unsecured
debt ratings were upgraded one notch while the secured debt rating
remains unchanged. This narrowing of the senior secured rating
and senior unsecured rating reflects the lower differentiation as
the IDR moves up the rating scale.
The rating for Conseco Life Insurance Company remains unchanged.
Fitch views the entity as of Limited Importance under its
Insurance Rating Methodology due to the run-off nature of the
business. All of the other CNO Financial insurance companies
rated by Fitch are considered Core.
Key rating drivers that could lead to an upgrade include:
-- Continued generation of stable earnings free of significant
special charges;
-- Expansion of cushion versus existing covenant requirements or
refinancing of the senior secured notes to create a debt
profile consistent with peer life insurance companies;
-- Maintaining increased GAAP interest coverage ratio and NAIC
RBC above 6x and 350%, respectively.
Key rating drivers that could lead to a downgrade include:
-- Combined NAIC RBC ratio less than 300% and operating leverage
above 20x;
-- Deterioration in operating results;
-- Significant increase in credit-related impairments in 2012;
-- Financial leverage above 30% and TFC above 0.65x.
Fitch has upgraded the following ratings.
CNO Financial Group, Inc.
-- IDR at to 'BB-' from 'B+';
-- $293 million 7% due Dec. 30, 2016 to 'B+' from 'B/RR5'.
Bankers Life and Casualty Company
-- IFS to 'BBB' from 'BBB-'.
Bankers Conseco Life Insurance Company
Colonial Penn Life Insurance Company
Washington National Insurance Company
--IFS to 'BBB' from 'BB+'.
The following ratings were affirmed.
CNO Financial Group, Inc.
-- $375 million senior secured bank credit facility due Sept.
30, 2016 at 'BB';
-- $275 million senior secured note 9% due Jan. 15, 2018 at
'BB'.
Conseco Life Insurance Company
-- IFS at 'BB+'.
All of the recovery ratings for CNO Financial Group debt are being
withdrawn.
COMPANIA SIDERUGICA: Moody's Says SWT Buyout No Impact on Rating
----------------------------------------------------------------
Moody's Investors Service commented that Companhia Siderurgica
Nacional's - CSN Ba1 corporate family rating and stable outlook
are unaffected by the announcement that the company has acquired
Stahlwerk Thuringen GmbH (SWT), along-steel producer as well as
Gallardo Sections SLU, a steel distributor, both based in Germany,
from Spain-based Grupo Alfonso Gallardo. The purchase price is EUR
482.5 million.
RATINGS RATIONALE
The principal methodology used in rating Companhia Siderurgica
Nacional's - CSN was the Global Steel Industry Methodology
published in January 2009.
Companhia Siderurgica Nacional is a vertically integrated, low-
cost producer of flat-rolled steel, including slabs, hot and cold
rolled steel, and a wide range of value-added steel products, such
as galvanized sheet and tinplate. In addition, the company has
downstream operations to produce customized products, pre-painted
steel and steel packaging. Pro-forma for the acquisition, CSN will
have an annual capacity of 6.7 million tons of crude steel and 6
million tons of rolled products.CSN sells its products to a broad
array of industries, including the automotive, capital goods,
packaging, construction and home appliance sectors. CSN owns and
operates cold rolling and galvanizing facilities in the U.S. and
in Portugal, besides relevant iron ore, limestone, dolomite and
tin reserves, railroads, port terminals and power generation
assets. Consolidated net revenues for the twelve months ended
September 30, 2011 were BRL 15.7 billion (US$8.7 billion).
COMPREHENSIVE CARE: Clark Marcus Discloses 16.4% Equity Stake
-------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Clark A. Marcus disclosed that, as of
Jan. 27, 2012, he beneficially owns 11,570,000 shares of common
stock of Comprehensive Care Corporation representing 16.4% of the
shares outstanding. As previously reported by the TCR on Jan. 10,
2012, Mr. Marcus disclosed beneficial ownership of 12,570,000
shares. A full-text copy of the amended filing is available for
free at http://is.gd/84AY0t
About Comprehensive Care
Tampa, Fla.-based Comprehensive Care Corporation provides managed
care services in the behavioral health, substance abuse, and
psychotropic pharmacy management fields.
The Company reported a net loss of $10.4 million on $35.2 million
of revenues for 2010, compared with a net loss of $18.9 million on
$14.2 million of revenues for 2009.
The Company also reported a net loss of $6.47 million on
$54.04 million of total revenues for the nine months ended
Sept. 30, 2011, compared with a net loss of $8.63 million on
$17.34 million of total revenues for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$14.67 million in total assets, $26.41 million in total
liabilities and a $11.73 million total stockholders' deficiency.
Mayer Hoffman McCann P.C., in Clearwater, Fla., 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 and has not
generated sufficient cash flows from operations to fund its
working capital requirements.
CONVERTED ORGANICS: Terminates Agreement with Waste Systems
-----------------------------------------------------------
Converted Organics Inc. received written notice from Waste
Systems, LLC, that the agreement between the Company and Waste
Systems dated Jan. 10, 2011, which was amended on Sept. 27, 2011,
was being terminated.
The Company's default was due to its failure to make the required
minimum monthly payments relating to the purchase of waste water
equipment operated by Waste Systems. As a result of the default,
title to the equipment will remain with Waste Systems, the Company
will forfeit any previous installments made towards the purchase
of the equipment, and the Agreement is terminated.
Converted Organics
Boston, Mass.-based Converted Organics Inc. utilizes innovative
clean technologies to establish and operate environmentally
friendly businesses. Converted Organics currently operates in
three business areas, namely organic fertilizer, industrial
wastewater treatment and vertical farming.
The Company reported a net loss of $8.9 million on $2.8 million of
revenues for the nine months ended Sept. 30, 2011, compared with a
net loss of $31.6 million on $2.8 million of revenues for the same
period last year.
The Company's balance sheet at Sept. 30, 2011, showed
$17.2 million in total assets, $11.9 million in total liabilities,
and stockholders' equity of $5.3 million.
As reported in the TCR on April 7, 2011, CCR LLP, in Glastonbury,
Connecticut, expressed substantial doubt about Converted Organics'
ability to continue as a going concern, following the Company's
results for the fiscal year ended Dec. 31, 2010. The independent
auditors noted that the Company has an accumulated deficit at
Dec. 31, 2010, and has suffered significant net losses and
negative cash flows from operations.
COPANO ENERGY: Moody's Rates $150-Mil. Sr. Note Offering at 'B1'
----------------------------------------------------------------
Moody's Investors Services assigned a B1 rating to Copano Energy,
L.L.C.'s (CPNO) proposed $150 million senior unsecured notes due
2021. The Ba3 Corporate Family Rating (CFR) and the negative
outlook are not affected by this action. The notes will be an add
on to the company's 7.125% senior notes due 2021 and will be part
of the same series of debt securities. CPNO plans to use the
proceeds of the new notes to repay a portion of the outstanding
indebtedness under its senior secured revolving credit facility.
RATINGS RATIONALE
"CPNO's Ba3 CFR and negative outlook reflect the company's
elevated financial leverage, which increased over the course of
2011 because of the more than $400 million of largely debt-
financed capital spending, as well as its aggressive distribution
policy," said Andrew Brooks, Moody's Vice President. "The multiple
projects under development in the Eagle Ford shale in particular
are expected to generate significant incremental cash flow, and it
is Moody's expectation that this capital spending will generate
growth in EBITDA that will better support the company's debt
position."
At September 30, 2011, CPNO's debt leverage was 6.3x, increasing
from 4.8x at year-end 2010, reflecting the company's spending on
its Eagle Ford shale projects, which were financed largely under
its secured revolving credit facility. As these projects enter
commercial operation in 2011's fourth quarter and into 2012, they
should generate over $100 million of incremental EBITDA. These
projects will also generate incrementally higher amounts of fee-
based revenues.
In January 2012, CPNO issued 5.75 million of new common units
raising $187.5 million of net proceeds, which were used to repay
outstanding revolving credit borrowings. Pro forma for the equity
offering, debt/EBITDA at September 30, 2011 would have been an
improved 5.25x. Even with 2012's capital spending of over $300
million projected to exceed cash flow, incremental EBITDA from new
projects should drive leverage below 5x by year-end. Increased
cash flow should also begin to restore positive distribution
coverage ratios, albeit at minimal levels typical of MLPs,
following coverage ratios of less than 1x over the course of 2009-
2010.
CPNO relies on its $700 million senior secured revolving credit
facility for its liquidity. The facility has a June 2016 scheduled
maturity date, and at September 30, 2011 had $295 million of
borrowings outstanding. Pro forma for the January 2012 equity
issuance, and this add on debt issue, CPNO should have ample
availability under its revolver to fund any and all of 2012's
projected capital spending as needed.
CPNO could be downgraded if leverage and distribution coverage do
not begin to evidence signs of improvement by mid-2012. Prior to
year-end 2012, debt leverage should be under 5x, heading to 4.5x,
to avoid a downgrade, while distribution coverage should exceed
1.0x. While an upgrade in the near term is unlikely, CPNO has made
recent progress in addressing downgrade risk. A ratings upgrade
could be considered should leverage fall below 4x with
distribution coverage at least 1.1x. A stable outlook would be
considered should demonstrable and sustained progress be evidenced
in this direction.
The B1 rating on the $150 million of senior notes reflects both
the overall probability of default of Copano, to which Moody's
assigns a PDR of Ba3, and a loss given default of LGD5 (73%). CPNO
has a $700 million senior secured revolving credit facility, of
which $295 million was drawn at September 30, 2011. Its senior
unsecured notes are subordinate to the senior secured credit
facility's priority claim to the company's assets. The size of the
potential senior secured claims relative to CPNO's outstanding
senior unsecured notes results in the senior notes being rated one
notch beneath the Ba3 CFR under Moody's Loss Given Default
Methodology.
The principal methodology used in rating Copano Energy was the
Global Midstream Energy Industry Methodology published in December
2010. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Copano Energy, L.L.C. is headquartered in Houston, Texas.
COSTA BONITA: Apartment Owner in Puerto Rico Files for Ch. 11
-------------------------------------------------------------
Costa Bonita Beach Resort Inc. filed a Chapter 11 bankruptcy
petition (Bankr. D. P.R. Case No. 12-00778) on Feb. 2, 2012, in
Old San Juan, Puerto Rico.
The Debtor is the owner of 50 apartments at the Costa Bonita Beach
Resort in Culebra, Puerto Rico.
Assets are worth $15.1 million with debt totaling $14.2 million,
including secured debt of $7.8 million. The apartments are valued
at $9.6 million while a restaurant and some commercial spaces at
the resort are valued at $3.67 million. The apartments serve as
collateral for the $7.8 million while the commercial property is
unencumbered.
The Debtor has a prior bankruptcy case. It filed for bankruptcy
(Bankr. D. P.R. Case No. 09-069911) on Feb. 3, 2009.
COUGAR OIL: Obtains CCAA Protection Until March 2
-------------------------------------------------
In a SEC Form 6-K filing Friday, Cougar Oil and Gas Canada, Inc.,
discloses that it has requested and obtained an Order from the
Alberta Court of Queen's Bench providing creditor protection under
the Companies' Creditors Arrangement Act (Canada). While under
CCAA protection, the Company will continue with its day to day
operations.
On Nov. 15, 2011, the potential purchaser under a Binding Letter
of Intent to acquire some of the Company's non-core assets
defaulted on its agreements. The sale of these assets would have
removed a requirement to increase the ERCB LMR deposit ("long term
well abandonment liability deposit"). Because the potential
purchaser asked for multiple extensions and placed a partial
deposit, the Company agreed to several extensions of the closing.
However, the potential purchaser did not meet the closing
conditions or provide required pre-closing information to the
ERCB. As a result the ERCB prohibited the transfer of the wells
and the potential purchaser defaulted on the purchase of the
Company?s none core assets. The delays in the acquisition process
then resulted in the ERCB putting Cougar on notice to increase its
LMR deposit.
To date, because the Company was not able to fund the Cdn$630,000
LMR deposit in a manner satisfactory to the ERCB, the ERCB has
ordered the wells and facilities of the Company shut in until the
LMR deposit is made and the ERCB requirements are met. The
Company immediately appealed the order and is reviewing its
options in seeking damages due to the default of the potential
purchaser under the terms of the Binding Letter of Intent. The
Company operations were shut in starting on Jan. 23, 2012. The
Company continues to seek sufficient financing to get the wells
turned back on.
Additionally, as a result of the default of the potential
purchaser and the resultant ERCB action, the Company then had only
revenue from its non operated gas properties which was
insufficient to continue day to day operations and pay existing
creditors.
Over the last several months, the Company has had its operations
reduced, its expenses increased and its net income reduced as a
result of the Rainbow Pipeline break, the wild fires of the Slave
Lake area and a short term drop in commodity prices. Because of
the capital conditions due to the last recession and the ongoing
problems in the European capital markets, the availability of
funding for operations and capital expenditures has become more
restricted and expensive.
The Board of Directors of Cougar has therefore decided to seek
CCAA protection after considering its currently available
alternatives. CCAA protection stays creditors and others from
enforcing rights against the Company and affords the Company the
opportunity to restructure its financial affairs. The Court has
granted CCAA protection until March 2, 2012, to be further
extended as required and approved by the Court.
"We made the difficult decision to seek creditor protection
because we believe this step to be in the best interest of all our
stakeholders," said William Tighe, Chief Executive Officer. "We
have been actively seeking options to manage our liquidity and to
raise the capital we need to proceed with developing our assets
To protect those assets and to find a solution that will enable
them to be developed, we are seeking options to restructure our
affairs."
While under CCAA protection, the Board of Directors maintains its
usual role and management remains responsible for the day to day
operations, under the supervision of a Court-appointed monitor,
Ernst and Young. The monitor will be responsible for reviewing
ongoing operations, assisting with the development and
implementation of a Plan of Arrangement ("Plan") that is
established by management, liaising with creditors and other
stakeholders and reporting to the Court. The Board of Directors
and management will be primarily responsible for determining
whether a Plan for restructuring the Company's affairs is
feasible. Affected stakeholders will have an opportunity to vote
on the Plan. Before the Plan is implemented it must be approved
by the requisite number and value of affected stakeholders
contemplated by law and approved by the Court.
CCAA protection enables the Company to continue with its day to
day operations until the CCAA status changes. The implications of
this process for shareholders will not be known until the end of
the restructuring process. If the secured stakeholders do not
approve a Plan in the manner contemplated by law, the Company will
likely be placed into receivership or bankruptcy. If by March 3,
2012, the Company has not filed a Plan or obtained an extension of
the CCAA protection, creditors and others will no longer be stayed
from enforcing their rights. The Company will issue a further
press release on or before March 3, 2012 to provide an update.
"We remain confident that our Trout oil assets and specifically
the new drilling program can be developed into long term
commercial facilities," Mr. Tighe concluded. "The timing of the
pipeline break and the long delay before the ERCB would permit
restoration of service, the well drilled in the spring of 2011
which had inclusive results and still needs $200,000 to properly
test it, the overall state of the world economy especially in
Europe which had provided the Company with much of its financing
since inception, a short downturn in commodity prices in the
middle of the critical pipeline break, the lack of available
financing for junior companies like the Company, has impacted our
ability to access capi tal or to identify strategic alternatives
to enable us to proceed. We hope that through this process we will
be able to arrive at a satisfactory solution for all our
stakeholders including our shareholders."
Cougar Oil
Headquartered in Calgary, Canada, Cougar Oil and Gas Canada, Inc.,
formerly Ore-More Resources, Inc., was incorporated under the laws
of the Province of Alberta, Canada on June 20, 2007. The
Company's principal activity is in the exploration, development,
production and sale of oil and natural gas. The Company's main
operations are currently in the Alberta and British Columbia
provinces of Canada.
The Company reported a net loss of C$5.1 million on C$1.9 million
of oil & gas sales for the nine months ended Sept. 30, 2011,
compared with a net loss of Cdn$1.2 million on C$2.5 million of
oil & gas sales for the same period in 2010.
The Company's balance sheet at Sept. 30, 2011, showed
C$14.2 million in total assets, C$14.3 million in total
liabilities, and a stockholders' deficit of C$120,184.
* * *
RBSM, LLP, in New York, expressed substantial doubt about Cougar
Oil and Gas Canada's ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2010. The independent auditors noted that the Company has
suffered recurring losses since its inception and has a working
capital deficiency.
CYBERDEFENDER CORP: Hires XRoads as Restructuring Advisor
---------------------------------------------------------
CyberDefender Corporation and XRoads Solutions Group, LLC, a
financial advisory firm, entered into a Letter Agreement pursuant
to which the Company engaged XRoads to serve as the Company's
restructuring advisor to explore the Company's options, including
in connection with the Company's possible efforts to reorganize or
sell its assets. The Company's Board of Directors has not
authorized any reorganization or sale transaction and has engaged
XRoads solely to provide the advice and services described in the
Agreement.
The Engagement commences as of the execution of the Agreement and
XRoads' receipt of an initial fee. The Engagement may be
terminated by the Company upon thirty days' written notice and
XRoads may withdraw from the Engagement for good cause, as that
term is defined in the Agreement, without the Company's consent.
Pursuant to the Agreement, the Company will pay XRoads the initial
fee within two business days of the execution of the Agreement in
payment of work performed by XRoads for up to thirty days. In the
event XRoads' work exceeds thirty days, the Company will pay
XRoads a monthly fee, in advance, for continuing work, up to the
maximum amount set forth in the Agreement. Pursuant to the
Agreement, the Company also will pay XRoads' limited out-of-pocket
expenses.
The Agreement also includes provisions relating to, among other
things, confidentiality, warranties and indemnification and legal
proceedings and arbitration.
A full-text copy of the Letter Agreement is available for free at:
http://is.gd/NC6mea
About CyberDefender
Los Angeles, Calif.-based CyberDefender Corporation is a provider
of remote LiveTech services and security and computer optimization
software and to the consumer and small business market. The
Company's mission is to bring to market advanced solutions to
protect computer users against Internet viruses, spyware, identity
theft and related security threats.
The Company reported a net loss of $17.58 million on $39.88
million of total net revenue for the nine months ended Sept. 30,
2011, compared with a net loss of $31.21 million on $31.93 million
of total net revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$7.96 million in total assets, $42.54 million in total
liabilities, and a $34.58 million total stockholders' deficit.
Bankruptcy Warning
During the third quarter, the Company closed two private offerings
of subordinated convertible promissory notes to accredited
investors, totaling $3.2 million with a commitment for another
$2.0 million. The Company believes, but cannot insure, that the
$5.2 million will be sufficient to permit the Company to continue
to operate until it can secure the additional financing that it
requires to continue to operate as a going concern and to repay
the approximately $11.7 million of debt owed to GR Match, LLC, due
on March 31, 2012. The accompanying financial statements have
been prepared assuming that the Company will continue as a going
concern; however, if additional financing is not secured, it would
raise substantial doubt about the Company's ability to continue as
a going concern.
The Company is presently engaged in active discussions with
existing and prospective investors to secure additional financing,
but there are no commitments at this time and the Company can give
no assurance that the additional financing can be secured on
favorable terms, or at all. If the Company cannot obtain
additional financing, the Company may be forced to further curtail
its operations, or possibly be forced to evaluate a sale of the
Company or consider other alternatives, such as bankruptcy.
DELTA PETROLEUM: Notice Protocol for Equity Trading Gets Final OK
-----------------------------------------------------------------
On Jan. 11, 2012, the U.S. Bankruptcy Court for the District of
Delaware entered a Final Order Establishing Notification and
Hearing Procedures for Trading in Equity Securities. The Final
Order stipulates that a copy of the Final Order will be filed as
an exhibit to a report on Form 8-K.
A copy of the Final Order is available for free at:
http://is.gd/SgnTgt
Any purchase, sale, or other transfer of Stock in violation of the
Procedures set forth in the Final Order will be null and void ab
initio as an act in violation of the automatic stay under Sections
362 and 105(a) of the Bankruptcy Code.
About Delta Petroleum
Delta Petroleum Corporation (NASDAQ: DPTR) is an independent oil
and gas company engaged primarily in the exploration for, and the
acquisition, development, production, and sale of, natural gas and
crude oil. Natural gas comprises over 90% of Delta's production
services. The core area of its operations is the Rocky Mountain
Region of the United States, where the majority of the proved
reserves, production and long-term growth prospects are located.
Delta and seven of its subsidiaries sought Chapter 11 bankruptcy
protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013,
inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31,
2012 scheduled maturity of its $38.5 million secured credit
facility with Macquarie Bank Limited and after several months of
unsuccessful attempts to sell the business. Delta disclosed
$375,498,248 in assets and $310,679,157 in liabilities, which also
include $152,187,500 in outstanding obligations on account of the
7% senior unsecured notes issued in March 2005 with US Bank
National Association indenture trustee; and $115,527,083 in
outstanding obligations on account of 3-3/4% Senior Convertible
Notes due 2037 issued in April 2007.
W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A.
Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard &
Reed LLP, in New York, N.Y., represent the Debtors as counsel.
Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights,
Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del.,
represent the Debtors as co-counsel. Conway Mackenzie is the
Debtors's restructuring advisor. The Debtors selected Epiq
Bankruptcy Solutions, LLC as claims and noticing agent. The
petition was signed by Carl E. Lakey, chief executive officer and
president.
Delta will hold an auction for the business on March 26, 2012. No
buyer is under contract. There is $57.5 million in financing for
the Chapter 11 effort.
DEX MEDIA EAST: Bank Debt Trades at 53% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media East LLC
is a borrower traded in the secondary market at 46.92 cents-on-
the-dollar during the week ended Friday, Feb. 3, 2012, an increase
of 1.32 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. The bank loan matures on Oct. 24, 2014. The
loan is one of the biggest gainers and losers among 168 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About R.H. Donnelley & 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. 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 (Bank. D. Del. Case No. 09-11833 through 09-
11852) on May 28, 2009, after missing a $55 million interest
payment on its senior unsecured notes. 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,
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.,
served as 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 43% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media West LLC
is a borrower traded in the secondary market at 56.67 cents-on-
the-dollar during the week ended Friday, Feb. 3, 2012, an increase
of 1.17 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. The bank loan matures on Oct. 24, 2014, and
carries Standard & Poor's CCC rating. The loan is one of the
biggest gainers and losers among 168 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 (Bank. D. Del. Case No. 09-11833 through 09-
11852) on May 28, 2009, after missing a $55 million interest
payment on its senior unsecured notes due April 15, 2009. 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, served as lead bankruptcy counsel to
the Debtors. Attorneys at Young, Conaway, Stargatt & Taylor LLP,
in Wilmington, Delaware, served as local counsel. Deloitte
Financial Advisory Services LLP was the financial advisor and
Lazard Freres & Co. LLC was the investment banker. 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.
DEX ONE: Robert Mead Discloses 6.4% Equity Stake
------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Robert E. Mead disclosed that, as of Dec. 31,
2011, he beneficially owns 3,250,000 shares of common stock of
Dex One Corporation representing 6.47% of the shares outstanding.
A full-text copy of the filing is available at http://is.gd/YFGNJw
About Dex One
Dex One, headquartered in Cary, North Carolina, is a local
business marketing services company that includes print
directories and online voice and mobile search. Revenue was
approximately $1.1 billion for the LTM period ended Sept. 30,
2010.
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). They emerged from bankruptcy on Jan. 29,
2010. On the Effective Date and in connection with its emergence
from Chapter 11, RHD was renamed Dex One Corporation.
* * *
As reported by the TCR on Nov. 21, 2011, Standard & Poor's Ratings
Services lowered its ratings on Dex One Corp. and related entities
to 'CCC+' from 'B-'.
"The rating action is based on Dex One Corp.'s continued weak
operating performance and its announcement that it is exploring a
potential amendment, which would allow subpar repurchases of its
term debt," said Standard & Poor's credit analyst Chris Valentine.
He explained, "The term loan is trading at a very significant
discount to the par value, which we believe suggests a high
probability of a subpar buyback sometime over the next 12 months.
Under Standard & Poor's criteria, we would view these subpar
buybacks as tantamount to a default."
In the Oct. 10, 2011, edition of the TCR, Moody's Investors
Service has downgraded the corporate family rating (CFR) for Dex
One Corporation's ("Dex One" or "the company") to B3 from B1. The
downgrade reflects Moody's doubts that the company will be able to
transition its business away from a reliance on print directories
quickly enough to stabilize its revenues and earnings.
Consequently, Moody's expects that the relatively robust levels of
free cash flow that the company is currently generating will
decline at an accelerating pace over time. Moody's ratings outlook
for Dex One remains negative.
DOWNEY REGIONAL: Hospital Wins Confirmation of Chapter 11 Plan
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Downey Regional Medical Center-Hospital Inc. won
approval of the reorganization plan on Jan. 30. The hospital will
continue operating as a not-for-profit institution. About
$16.5 million in taxable bonds will be repurchased as part of the
plan. The hospital received a favorable vote from all creditor
classes except one.
Mr. Rochelle relates that the stand-alone plan received a
favorable vote from all creditor classes except one. The hospital
will remain as a nonprofit institution. About $16.5 million in
taxable bonds will be repurchased as part of the plan.
About Downey Regional
Downey Regional Medical Center is a 90-year-old, 199-bed, not-for-
profit regional hospital and medical center in Southeast Los
Angeles County, California. Regional Medical sought Chapter 11
protection (Bankr. C.D. Calif. Case No. 09-34714) on Sept. 14,
2009. Lisa Hill Fenning, Esq., at Arnold & Porter LLP in Los
Angeles, represents the Debtor in its restructuring effort. In
its petition, the Debtor estimated assets and debts between
$10 million and $50 million.
DRINKS AMERICAS: Patrick Kenny Discloses 20.1% Equity Stake
-----------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Patrick J. Kenny disclosed that, as of Jan. 19, 2012,
he beneficially owns 4,201,567 shares of common stock of Drinks
Americas Holdings, Ltd., representing 20.1% of the shares
outstanding.
In connection with a Stock Purchase Agreement, dated June 27,
2011, and an Amendment No. 1 to the Stock Purchase Agreement,
dated Nov. 1, 2011, the Company sold 4,175,348 shares to the Mr.
Kenny, through Kenny LLC I, in exchange for the cancellation of
the Company's Series C Preferred Stock owned by Mr. Kenny and in
consideration for Mr. Kenny's investment into the Company. As a
result of the acquisition, 4,180,968 shares are owned by Kenny LLC
I. And on Jan. 23, 2012, Mr. Kenny, through Kenny LLC I,
purchased 20,000 shares from the Company. As a result of the
acquisition, 4,200,968 shares are owned by Kenny LLC I. Mr. Kenny
is the sole member of Kenny LLC 1.
A full-text copy of the filing is available for free at:
http://is.gd/ApbGp4
About Drinks Americas
Headquartered in Wilton, Conn., Drinks Americas Holdings, Ltd. --
http://www.drinksamericas.com/-- through its majority-owned
subsidiaries, Drinks Americas, Inc., Drinks Global, LLC, D.T.
Drinks, LLC, and Olifant U.S.A Inc., imports, distributes and
markets unique premium wine and spirits and alcoholic beverages
associated with icon entertainers, celebrities and destinations,
to beverage wholesalers throughout the United States.
The Company reported a net loss of $4.58 million on $497,453 of
net sales for the year ended April 30, 2011, compared with a net
loss of $5.61 million on $890,380 of net sales during the prior
year.
Bernstein & Pinchuk, in New York, expressed substantial doubt
about the Company's ability to continue as a going concern. The
independent auditors noted that the Company has incurred
significant losses from operations since its inception and has a
working capital deficiency.
The Company's balance sheet at Oct. 31, 2011, showed $2.52 million
in total assets, $5.35 million in total liabilities, and a
$2.83 million total stockholders' deficiency.
EAGLE POINT: Files for Chapter 11 Bankruptcy Protection
-------------------------------------------------------
Greg Stiles at Mail Tribune reports that Eagle Point Developments
LLC filed on Feb. 1, 2012, for Chapter 11 protection in U.S.
Bankruptcy Court in Eugene, Oregon.
The report relates that Eagle Point Developments owes more than
200 creditors nearly $10 million, while its assets easily surpass
that figure.
According to the report, a wave of foreclosures swept through the
residential area around the golf course and building virtually
ceased as property values declined. Eagle Point lots presently
shown on the Galpin and Associates Web site are priced at $99,900.
The report says the lots haven't been selling and the cost of
maintaining the development led lender U.S. Bank to seek judgment
against Eagle Point Developments LLC. The property was due to be
auctioned off by Jackson County Sheriff Mike Winters morning of
Feb. 2. Portland attorney Susan Ford, Esq., of Sussman Shank
petitioned for court protection, putting the auction on hold.
Eagle Point Developments LLC develops the Eagle Point Golf Course,
which was built in 1996.
EAGLE POINT: Case Summary & 9 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Eagle Point Developments, LLC
744 Cardley Avenue, Suite 100
Medford, OR 97504
Bankruptcy Case No.: 12-60353
Chapter 11 Petition Date: February 1, 2012
Court: U.S. Bankruptcy Court
District of Oregon
Judge: Frank R. Alley, III
Debtor's Counsel: Susan S. Ford, Esq.
SUSSMAN SHANK LLP
1000 SW Broadway, #1400
Portland, OR 97205
Tel: (503) 227-1111
E-mail: susanf@sussmanshank.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Arthur Critchell Galpin, managing
member.
Debtor's List of Its Nine Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
US National Banking Association Deficiency if $8,942,687
1420 Fifth Avenue, 8th Floor Liquidated
Seattle, WA 98101
Richard Templin Land Survey Land Surveying $26,130
P.O. Box 1946
Jacksonville, OR 97530
Eagle Point Community Golf HOA HOA Dues $12,816
CPM Real Estate Services Inc.
718 Black Oak Drive, Suite A
Medford, OR 97504
Medford Municipal Court Citations $9,642
Tony Brudevold Services $75
City of Eagle Point Services $20
Southern Oregon Sanitation Utilities $15
American Hallmark Insurance Insurance Unknown
State Farm Insurance Insurance Unknown
ELEPHANT & CASTLE: Court Approves Sale to Original Joe's
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Elephant & Castle Group Inc. was authorized by the
bankruptcy court in Boston to sell the business for $22.75 million
to an affiliate of the Original Joe's restaurant chain from
Calgary, Alberta. There were no other bids.
The report relates that the judge also extended the company's
exclusive right to propose a Chapter 11 plan until April 23. The
company previously said it "anticipates" filing a liquidating
Chapter 11 plan after the sale is completed.
About Massachusetts Elephant & Castle Group
Boston-based Massachusetts Elephant & Castle Group and its
affiliates operates 21 British-style restaurant pubs
in the U.S. and Canada. The chain, with 10 locations in the U.S.,
generated revenue of $47.5 million in 2010, throwing off
$3.9 million of earnings before interest, taxes, depreciation,
amortization, and foreign exchange gains or losses.
Elephant & Castle filed for Chapter 11 protection (Bankr. D. Mass.
Lead Case No. 11-16155) on June 28, 2011. Bankruptcy Judge Henry
J. Boroff presides over the case. Repechage Investments'
estimated assets and debts at $10 million to $50 million. Other
Debtors' estimated assets and debts at $0 to $10 million.
Eckert Seamans Chein & Mellott, LLC, represent the Debtors as
counsel and BellMark Partners, LLC as financial advisor. Epiq
Bankruptcy Solutions, LLC as claims, noticing and balloting agent.
Phoenix Management serves as the Company's Chief Restructuring
Advisor.
FTI Consulting, Inc., is the Official Committee of Unsecured
Creditors' financial advisors. Goulston & Storrs, P.C., is the
Committee's counsel.
HARRISBURG, PA: Appeal Dismissed for a Second Time
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the effort by the Harrisburg, Pennsylvania, city
council to appeal dismissal of the Chapter 9 municipal bankruptcy
was rebuffed a second time. A U.S. district judge dismissed the
appeal on Feb. 1, saying the city council's lawyer was three
days late in filing the appeal. The bankruptcy judge previously
dismissed the appeal on the same grounds.
About Harrisburg, Pennsylvania
The city of Harrisburg, in Pennsylvania, is coping with debt
related to a failed revamp of an incinerator. The city is
$65 million in default on $242 million owing on bonds sold to
finance an incinerator that converts trash to energy.
The Harrisburg city council voted 4-3 on Oct. 11, 2011, to
authorize the filing of a Chapter 9 municipal bankruptcy (Bankr.
M.D. Pa. Case No. 11-06938). The city claims to be insolvent,
unable to pay its debt and in imminent danger of having
tax revenue seized by holders of defaulted bonds.
Judge Mary D. France presided over the Chapter 9 case. Mark D.
Schwartz, Esq. and David A. Gradwohl, Esq., served as Harrisburg's
counsel. The petition estimated $100 million to $500 million in
assets and debts. Susan Wilson, the city's chairperson on Budget
and Finance, signed the petition.
Harrisburg said in court papers it is in imminent jeopardy through
six pending legal actions by creditors with respect to a number of
outstanding bond issues relating to the Harrisburg Materials,
Energy, Recycling and Recovery Facilities, which processes waste
into steam and electrical energy. The owner and operator of the
incinerator is The Harrisburg Authority, which is unable to pay
the bond issues. The city is the primary guarantor under each
bond issue. The lawsuits were filed by Dauphin County, where
Harrisburg is located, Joseph and Jacalyn Lahr, TD Bank N.A., and
Covanta Harrisburg Inc.
The Commonwealth of Pennsylvania, the County of Dauphin, and
Harrisburg city mayor Linda D. Thompson and other creditors and
interested parties objected to the Chapter 9 petition. The state
later adopted a new law allowing the governor to appoint a
receiver.
Kenneth W. Lee, Esq., Christopher E. Fisher, Esq., Beverly Weiss
Manne, Esq., and Michael A. Shiner, Esq., at Tucker Arensberg,
P.C., represented Mayor Thompson in the Chapter 9 case. Counsel to
the Commonwealth of Pennsylvania was Neal D. Colton, Esq., Jeffrey
G. Weil, Esq., Eric L. Scherling, Esq., at Cozen O'Connor.
In November 2011, the Bankruptcy Judge dismissed the Chapter 9
case because (1) the City Council did not have the authority under
the Optional Third Class City Charter Law and the Third Class City
Code to commence a bankruptcy case on behalf of Harrisburg and (2)
the City was not specifically authorized under state law to be a
debtor under Chapter 9 as required by 11 U.S.C. Sec. 109(c)(2).
That same month, the state governor appointed David Unkovic as
receiver for Harrisburg. Mr. Unkovic is represented by the
Municipal Recovery & Restructuring group of McKenna Long &
Aldridge LLP, led by Keith Mason, Esq., co-chair of the group.
EMMIS COMMUNICATIONS: Zazove Holds 20.3% of Preferred Shares
------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Zazove Associates, LLC, and Zazove
Associates, Inc., disclosed that, as of Jan. 31, 2012, they
beneficially own 491,510 shares of 6.25% Series A Cumulative
Convertible Preferred Stock, which are convertible as of Feb. 3,
2012, into 1,199,284 shares of Class A Common Stock, of Emmis
Communications Corporation representing 20.29% of the shares
outstanding. As previously reported by the TCR on Dec. 23, 2011,
Zazove disclosed beneficial ownership of 491,210 of Preferred
Shares. A full-text copy of the amended filing is available at:
http://is.gd/TZEAZJ
About Emmis Communications
Headquartered in Indianapolis, Indiana, Emmis Communications
Corporation -- http://www.emmis.com/-- owns and operates 22 radio
stations serving New York, Los Angeles, Chicago, St. Louis,
Austin, Indianapolis, and Terre Haute, as well as national radio
networks in Slovakia and Bulgaria. The company also publishes six
regional and two specialty magazines.
The Company reported a consolidated net loss of $11.54 million on
$251.31 million of net revenues for the year ended Feb. 28, 2011,
compared with a consolidated net loss of $118.49 million on
$242.56 million of net revenues during the prior year.
For the nine months ended Nov. 30, 2011, the Company reported net
income attributable to common shareholders of $97.72 million on
$185.08 million of net revenues, compared with a net loss
attributable to common shareholders of $7.92 million on $193.24
million of net revenues for the same period during the prior year.
The Company's balance sheet at Nov. 30, 2011, showed $365.70
million in total assets, $344.92 million in total
liabilities,$56.38 million in series A cumulative convertible
preferred stock and a $35.60 million total deficit.
* * *
In November 2010, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating and 'Caa3' Probability of Default rating
for Emmis Communications Corporation, as well as its SGL-4
speculative grade liquidity rating. Operating performance
improved with the economic recovery, but absent debt reduction
with proceeds from an asset sale or equity infusion Emmis will
likely breach its leverage covenant when the covenant suspension
period ends for the quarter ending November 30, 2011, in Moody's
opinion.
Emmis' CFR and PDR incorporate expectations for a covenant breach
in November 2011. Moody's considers the Company's capital
structure unsustainable, and its operations in the cyclical
advertising business magnify this challenge. Furthermore, Emmis
relies on two markets, Los Angeles and New York, for approximately
50% of its revenue, although its ownership of stations in top
markets including Chicago as well as NY and LA, support the
rating.
The negative outlook incorporates Moody's expectations that Emmis
will not comply with its maximum leverage covenant when effective
for the quarter ending Nov. 30, 2011.
EMMIS COMMUNICATIONS: DJD Group Owns 76,810 Preferred Shares
------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, DJD Group LLLP and Don DeFosset disclosed
that, as of Jan. 31, 2012, they beneficially own 76,810 shares of
6.25% Series A Cumulative Convertible Preferred Stock, $0.01 par
value per share, of Emmis Communications Corporation representing
3.17% the shares outstanding. The 76,810 shares of 6.25%
Preferred Shares is convertible into approximately 187,416 shares
of Class A Common Stock, par value $0.01 per share, of the
Company. The calculation is based on 2,422,320 shares of
Preferred Stock outstanding as of Jan. 24, 2012, as disclosed in
the Form 8-K filed by the Company on Jan. 30, 2012. A full-text
copy of the amended 13D is available at http://is.gd/HRGfIy
About Emmis Communications
Headquartered in Indianapolis, Indiana, Emmis Communications
Corporation -- http://www.emmis.com/-- owns and operates 22 radio
stations serving New York, Los Angeles, Chicago, St. Louis,
Austin, Indianapolis, and Terre Haute, as well as national radio
networks in Slovakia and Bulgaria. The company also publishes six
regional and two specialty magazines.
The Company reported a consolidated net loss of $11.54 million on
$251.31 million of net revenues for the year ended Feb. 28, 2011,
compared with a consolidated net loss of $118.49 million on
$242.56 million of net revenues during the prior year.
For the nine months ended Nov. 30, 2011, the Company reported net
income attributable to common shareholders of $97.72 million on
$185.08 million of net revenues, compared with a net loss
attributable to common shareholders of $7.92 million on $193.24
million of net revenues for the same period during the prior year.
The Company's balance sheet at Nov. 30, 2011, showed $365.70
million in total assets, $344.92 million in total
liabilities,$56.38 million in series A cumulative convertible
preferred stock and a $35.60 million total deficit.
* * *
In November 2010, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating and 'Caa3' Probability of Default rating
for Emmis Communications Corporation, as well as its SGL-4
speculative grade liquidity rating. Operating performance
improved with the economic recovery, but absent debt reduction
with proceeds from an asset sale or equity infusion Emmis will
likely breach its leverage covenant when the covenant suspension
period ends for the quarter ending November 30, 2011, in Moody's
opinion.
Emmis' CFR and PDR incorporate expectations for a covenant breach
in November 2011. Moody's considers the Company's capital
structure unsustainable, and its operations in the cyclical
advertising business magnify this challenge. Furthermore, Emmis
relies on two markets, Los Angeles and New York, for approximately
50% of its revenue, although its ownership of stations in top
markets including Chicago as well as NY and LA, support the
rating.
The negative outlook incorporates Moody's expectations that Emmis
will not comply with its maximum leverage covenant when effective
for the quarter ending Nov. 30, 2011.
EMMIS COMMUNICATIONS: Kevan Fight Holds 2.2% of Preferred Shares
----------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Kevan A. Fight disclosed that, as of Jan. 31,
2012, he beneficially owns 57,750 of 6.25% Series A Convertible
Preferred Stock, $0.01 par value per share of Emmis Communications
Corporation representing 2.24% of the shares outstanding, which
shares are convertible into 140,910 shares of Class A Common
Stock. A full-text copy of the amended filing is available for
free at http://is.gd/GpQwkB
About Emmis Communications
Headquartered in Indianapolis, Indiana, Emmis Communications
Corporation -- http://www.emmis.com/-- owns and operates 22 radio
stations serving New York, Los Angeles, Chicago, St. Louis,
Austin, Indianapolis, and Terre Haute, as well as national radio
networks in Slovakia and Bulgaria. The company also publishes six
regional and two specialty magazines.
The Company reported a consolidated net loss of $11.54 million on
$251.31 million of net revenues for the year ended Feb. 28, 2011,
compared with a consolidated net loss of $118.49 million on
$242.56 million of net revenues during the prior year.
For the nine months ended Nov. 30, 2011, the Company reported net
income attributable to common shareholders of $97.72 million on
$185.08 million of net revenues, compared with a net loss
attributable to common shareholders of $7.92 million on $193.24
million of net revenues for the same period during the prior year.
The Company's balance sheet at Nov. 30, 2011, showed $365.70
million in total assets, $344.92 million in total
liabilities,$56.38 million in series A cumulative convertible
preferred stock and a $35.60 million total deficit.
* * *
In November 2010, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating and 'Caa3' Probability of Default rating
for Emmis Communications Corporation, as well as its SGL-4
speculative grade liquidity rating. Operating performance
improved with the economic recovery, but absent debt reduction
with proceeds from an asset sale or equity infusion Emmis will
likely breach its leverage covenant when the covenant suspension
period ends for the quarter ending November 30, 2011, in Moody's
opinion.
Emmis' CFR and PDR incorporate expectations for a covenant breach
in November 2011. Moody's considers the Company's capital
structure unsustainable, and its operations in the cyclical
advertising business magnify this challenge. Furthermore, Emmis
relies on two markets, Los Angeles and New York, for approximately
50% of its revenue, although its ownership of stations in top
markets including Chicago as well as NY and LA, support the
rating.
The negative outlook incorporates Moody's expectations that Emmis
will not comply with its maximum leverage covenant when effective
for the quarter ending Nov. 30, 2011.
EMMIS COMMUNICATIONS: First Derivative Owns 5,500 Pref. Shares
--------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, First Derivative Traders LP and its affiliates
disclosed that, as of Jan. 20, 2012, they beneficially own 5,500
shares of 6.25% Series A Cumulative Convertible Preferred Stock,
representing 0.2% of the shares outstanding. The shares of
Preferred Stock are convertible into 13,420 shares of Class A
Common Stock. A full-text copy of the filing is available for
free at http://is.gd/zIsKmd
About Emmis Communications
Headquartered in Indianapolis, Indiana, Emmis Communications
Corporation -- http://www.emmis.com/-- owns and operates 22 radio
stations serving New York, Los Angeles, Chicago, St. Louis,
Austin, Indianapolis, and Terre Haute, as well as national radio
networks in Slovakia and Bulgaria. The company also publishes six
regional and two specialty magazines.
The Company reported a consolidated net loss of $11.54 million on
$251.31 million of net revenues for the year ended Feb. 28, 2011,
compared with a consolidated net loss of $118.49 million on
$242.56 million of net revenues during the prior year.
For the nine months ended Nov. 30, 2011, the Company reported net
income attributable to common shareholders of $97.72 million on
$185.08 million of net revenues, compared with a net loss
attributable to common shareholders of $7.92 million on $193.24
million of net revenues for the same period during the prior year.
The Company's balance sheet at Nov. 30, 2011, showed $365.70
million in total assets, $344.92 million in total
liabilities,$56.38 million in series A cumulative convertible
preferred stock and a $35.60 million total deficit.
* * *
In November 2010, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating and 'Caa3' Probability of Default rating
for Emmis Communications Corporation, as well as its SGL-4
speculative grade liquidity rating. Operating performance
improved with the economic recovery, but absent debt reduction
with proceeds from an asset sale or equity infusion Emmis will
likely breach its leverage covenant when the covenant suspension
period ends for the quarter ending November 30, 2011, in Moody's
opinion.
Emmis' CFR and PDR incorporate expectations for a covenant breach
in November 2011. Moody's considers the Company's capital
structure unsustainable, and its operations in the cyclical
advertising business magnify this challenge. Furthermore, Emmis
relies on two markets, Los Angeles and New York, for approximately
50% of its revenue, although its ownership of stations in top
markets including Chicago as well as NY and LA, support the
rating.
The negative outlook incorporates Moody's expectations that Emmis
will not comply with its maximum leverage covenant when effective
for the quarter ending Nov. 30, 2011.
EMPRESAS INTEREX: Hires Carrasquillo as Financial Consultant
------------------------------------------------------------
Empresas Interex Inc. asks the U.S. Bankruptcy Court for
permission to employ CPA Luis R. Carrsquillo & Co., P.S.C. as
financial consultant. The Debtor said it needs a financial
consultant to assist management in the financial restructuring of
its affairs by providing advice in strategic planning and the
preparation of the Debtor's plan of reorganization, disclosure
statement and business plan, and participating in the Debtor's
negotiations with creditors.
The Debtor has paid Carrasquillo $12,000 in advance.
With the exception that Carrasquillo has acted as financial
consultant in other bankruptcy cases in which Charles A. Curpill,
Esq., the Debtor's counsel, has or is representing debtors,
Carrasquillo has no other prior connections with Debtor, its
officers, directors, and insiders, any creditor, or other party in
interest, their respective attorneys and accountants, the U.S.
trustee or any person employed in the office of the U.S.
The firm's rates are:
Professional Rates
------------ -----
Partner $160
Senior CPA $125
Other CPA's $90-$125
Senior Accountant $75- $85
Junior Accountant $50
Administrative support $35
San Juan, Puerto Rico-based Empresas Interex Inc. filed for
Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 11-10475) on
Dec. 7, 2011. Bankruptcy Judge Mildred Caban Flores presides over
the case. Empresas Interex disclosed US$11,060,170 in assets and
US$9,335,561 in debts. The petition was signed by Hector Alvarez,
president.
EMPRESAS INTEREX: Files Schedules of Assets and Liabilities
-----------------------------------------------------------
Empresas Interex Inc.filed with the U.S. Bankruptcy Court its
schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $10,992,000
B. Personal Property $68,170
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $7,749,407
E. Creditors Holding
Unsecured Priority
Claims $14,504
F. Creditors Holding
Unsecured Non-priority
Claims $1,571,649
----------- -----------
TOTAL $11,060,170 $9,335,561
A copy of the scheduled of assets and liabilities is available
free at http://bankrupt.com/misc/EMPRESAS_INTEREX_sal.pdf
San Juan, Puerto Rico-based Empresas Interex Inc. filed for
Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 11-10475) on
Dec. 7, 2011. Bankruptcy Judge Mildred Caban Flores presides
over the case. The petition was signed by Hector Alvarez,
president.
ENER1 INC: Boris Zingrevich Files 14th Amendment to Schedule 13D
----------------------------------------------------------------
On Jan. 31, 2012, Boris Zingrevich, Ener1 Group, Inc., and Bzifin
S.A. filed a 14th Amendment to Schedule 13D dated Jan. 3, 2002,
with respect to the common stock, par value $0.01 per share, of
Ener1, Inc., to disclose the amendment, as of Jan. 27, 2012, of
Items 4, 6 and 7 of the Statement.
Item 4, Purpose of Transaction, is amended to add the information
that on Jan. 27, 2012, in connection with the Chapter 11 Case, the
Bankruptcy Court authorized the Company on an interim basis to
enter into the Debtor-in-Possession Loan Agreement with Bzinfin,
as lender and agent.
Item 6, Contracts, Arrangements, Understandings or Relationships
With Respect to Securities of the Issuer, is amended to add the
information that on Jan. 27, 2012, the Company and Bzifin entered
into the DIP Loan Agreement described in Item 4.
Item 7, Material to be Filed as Exhibits, is amended to add
Exhibit 99.69 Debtor-in-Possession Loan Agreement, dated Jan. 27,
2012 (incorporated by reference to Exhibit 10.1 of the Company's
Current Report on Form 8-K dated Jan. 27, 2012, and filed with the
SEC on Jan. 30, 2012.
A full-text of the SC13D/A is available for free at:
http://is.gd/2Fis3E
About Ener1
Ener1 Inc. (OTC: HEVV) -- http://www.ener1.com/-- is a New York-
based developer of compact, lithium-ion-powered energy storage
solutions for applications in the electric utility, transportation
and industrial electronics markets. It has three business lines:
EnerDel, an 80.5% owned subsidiary, which is 19.5% owned by
Delphi, develops Li-ion batteries, battery packs and components
such as Li-ion battery electrodes and lithium electronic
controllers for lithium battery packs; EnerFuel develops fuel cell
products and services; and NanoEner develops technologies,
materials and equipment for nano-manufacturing.
Ener1, which received a $118 million U.S. Energy Department grant
to make electric-car batteries, filed for Chapter 11 bankruptcy
(Bankr. S.D.N.Y. Case No. 12-10299) on Jan. 26, 2012, to implement
a prepackaged plan of reorganization. The Plan has been
unanimously accepted by all of Ener1's impaired creditors.
Under its restructuring, the Debtor will reduce funded debt from
$91 million to $46 million, under a plan where debt holders will
receive newly issued debt and equity. The plan provides for a
restructuring of the Company's long-term debt and the infusion of
up to $81 million of equity funding. Of this amount, a new
debtor-in-possession credit facility of up to $20 million will be
available to support working capital needs during the
restructuring. The balance, for a total of up to $81 million,
will be available over the four years following Court approval of
the restructuring plan and subject to the satisfaction of certain
terms and conditions.
The claims of Ener1's general unsecured creditors will be
unimpaired and paid by the Company under the restructuring plan.
All of the Company's existing common stock will be cancelled, the
long-term debt holders will be receiving a combination of cash, a
new term loan and new common stock in exchange for their claims,
and new preferred stock will be issued to the provider of the
post-petition and exit funding. Suppliers to the Company will be
paid under normal terms for goods and services provided after the
Chapter 11 filing date. Payments for goods and services provided
directly to the Company prior to the filing date have been
previously settled or will be paid pursuant to the restructuring
plan when it is approved by the Court.
Of the $81 million, $50 million will be provided periodically by
Bzinfin S.A. over a period of 24 months following the effective
date of the plan. Bzinfin and other parties will invest their pro
rata share of up to $31 million through the purchase of preferred
stock from time to time through 2013 to 2015.
Ener1 expects to complete the restructuring process in about 45
days.
Judge Martin Glenn oversees the case. Reed Smith LLP is Ener1's
legal adviser and its financial adviser is Houlihan Lokey Capital
Inc. The Garden City Group serves as its claims and noticing
agent. In its petition, Ener1 estimated $73,900,000 in assets and
$90,538,529 in liabilities. The petition was signed by Alex
Sorokin, interim chief executive officer.
Bzinfin, S.A., is represented in the case by Andrew E. Balog,
Esq., and John H. Bae, Esq., at Greenberg Traurig, LLP. Counsel
to Goldman Sachs Palmetto State Credit Fund, L.P., and Liberty
Harbor Special Investments, LLC, are Gary Holtzer, Esq., and Ronit
Berkovich, Esq., at Weil, Gotshal & Manges LLP.
ENER1 INC: Judge Clears Firm to Tap $20 Million Bankruptcy Loan
---------------------------------------------------------------
Dow Jones' DBR Small Cap reports that car-battery manufacturer
EnerDel Inc.'s parent company got the green light to start
borrowing on a $20 million bankruptcy loan executives said will
power the struggling company through its financial restructuring.
Ener1, Inc. entered into the Debtor-in-Possession Loan Agreement
with Bzinfin S.A., as lender and agent, on Jan. 27, 2012. The DIP
Loan Agreement provides for a revolving facility not to exceed $20
million.
The Company's ability to draw revolving advances under the DIP
Loan Agreement is subject to the satisfaction of certain
conditions, including that requests be made by the Company at
least three business days in advance of the business day on which
any advance is to be made, requests be necessary and in
conformance with the Company's budget contained in the DIP Loan
Agreement and no event of default (as defined in the DIP Loan
Agreement) will have occurred and be continuing.
A final hearing regarding the DIP Loan Agreement, including
authorization to draw the remaining $6.5 million thereunder, is
scheduled before the Bankruptcy Court on Feb, 16, 2012.
Borrowings under the DIP Loan Agreement bear interest at LIBOR
plus 7% per annum and mature 90 days after the Petition Date,
except that borrowings may be required to be repaid earlier in the
case of an event of default under the DIP Loan Agreement. The
obligations of the Company as borrower under the DIP Loan
Agreement are secured by all of the present and future assets of
the Company, subject to certain exceptions, and are guaranteed by
the Company's subsidiaries EnerDel, Inc., EnerFuel, Inc. and
NanoEner, Inc.
About Ener1 Inc.
Ener1 Inc. (OTC: HEVV) -- http://www.ener1.com/-- is a New York-
based developer of compact, lithium-ion-powered energy storage
solutions for applications in the electric utility, transportation
and industrial electronics markets. It has three business lines:
EnerDel, an 80.5% owned subsidiary, which is 19.5% owned by
Delphi, develops Li-ion batteries, battery packs and components
such as Li-ion battery electrodes and lithium electronic
controllers for lithium battery packs; EnerFuel develops fuel cell
products and services; and NanoEner develops technologies,
materials and equipment for nano-manufacturing.
Ener1, which received a $118 million U.S. Energy Department grant
to make electric-car batteries, filed for Chapter 11 bankruptcy
(Bankr. S.D.N.Y. Case No. 12-10299) on Jan. 26, 2012, to implement
a prepackaged plan of reorganization.
Judge Martin Glenn oversees the case. Reed Smith LLP is Ener1's
legal adviser and its financial adviser is Houlihan Lokey Capital
Inc. The Garden City Group serves as its claims and noticing
agent. In its petition, Ener1 estimated $73,900,000 in assets and
$90,538,529 in liabilities. The petition was signed by Alex
Sorokin, interim chief executive officer.
ESPRIT: Closes 93 U.S. Stores After Failing to Find Buyer
---------------------------------------------------------
Sarah Duxbury, reporter at San Francisco Business Times, reports
that Esprit has announced it will close all 93 of its North
American stores.
According to the report, the company, which is now traded on the
Hong Kong stock exchange and is no longer based in the Bay Area,
failed to find a buyer for its North American business. It is
unclear if it will file for chapter 11 bankruptcy protection.
Bizjournal, citing a report from Business Week, says Esprit is
looking for a licensing partner for the brand in North America.
There are two Esprit stores remaining in the inner Bay Area, and
six in the broader region: Berkeley, San Leandro, Vacaville,
Milpitas, Gilroy and St. Helena in California.
The report notes that Esprit has already begun negotiating with
landlords about ending its leases.
Esprit -- http://www.esprit.com/-- offers an array of ladies'
fashion and men's fashion.
EXPRESSWAY DEVELOPMENT: Court Orders Dismissal of Bankruptcy Case
-----------------------------------------------------------------
U.S. Bankruptcy Judge Niles Jackson has approved the motion of
Richard A. Wieland, the U.S. Trustee for Region 20, to dismiss
Expressway Development, LLC's bankruptcy case.
As reported in the Troubled Company Reporter on Sept. 29, 2011,
Mr. Wieland said the Debtor filed a proposed disclosure statement
and plan on May 5, 2011. An amended disclosure statement was
filed on May 6. A hearing was scheduled for June 28, 2011, to
determine the adequacy of the Debtor's disclosure statement. No
objections to the disclosure statement were filed so the hearing
was stricken and the Debtor was directed to submit an order
approving the proposed disclosure statement. However, no order
has been submitted.
The U.S. Trustee enumerates the indications of the Debtor's
inability to reorganize:
-- failure to submit an order approving its disclosure
statement and to pursue confirmation of its proposed plan;
-- regular monthly operating reports show little or no
profit; and
-- the granting of relief from the stay relating to the
Debtor's ownership the property in Oklahoma County,
Oklahoma, in favor of the creditor, 99 I-35 Partners, LLC,
on July 7, 2011.
The U.S. Trustee is represented by:
Charles E. Snyder, Esq.
Office of the United States Trustee
215 Dean A. McGee, Room 408
Oklahoma City, OK 73102
Tel: (405) 231-5961
Fax: (405) 231-5958
E-mail: Charles.Snyder@usdoj.gov
About Expressway Development
Oklahoma City, Oklahoma-based Expressway Development, LLC, filed
for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No.
10-12088) on April 9, 2010. Charles E. Wetsel, Esq., at Robertson
& Williams, represents the Debtor. The Company estimated assets
and debts at $10 million to $50 million.
The Debtor also tapped Randel Shadid, Attorney at Law, to provide
legal services related to planning commission and presentations to
Edmond City Council; Marion Kordic & Associates to provide
commercial real estate appraisal services; Hayes Brokerage Co.,
Inc., to provide commercial real estate brokerage services; and
Smith, Carney & Co., P.C., to provide tax, accounting, and
bookkeeping services.
FCC HOLDINGS: Moody's Reviews 'Caa1' CFR for Possible Downgrade
---------------------------------------------------------------
Moody's Investors Service is continuing its review for possible
downgrade of the long-term ratings of FCC Holdings, LLC (First
Capital; Caa1 corporate family (CFR), Caa3 senior unsecured).
RATINGS RATIONALE
First Capital's ratings were initially placed under review on
October 12, 2011 due to Moody's growing concern regarding the
firm's weakening financial performance.
On November 4, 2011 Moody's downgraded First Capital's CFR to Caa1
from B2 and Senior Unsecured Notes to Caa3 from B3. In addition,
the ratings remained under review for a possible further
downgrade. The rating action stemmed from Moody's concern that the
firm's weakened financial performance could result in a covenant
breach. The increased notching between the CFR and Senior
Unsecured Notes rating reflected Moody's view that, were First
Capital to default, the loss severity for the rated unsecured debt
could be materially higher than for the firm's secured debt.
During the review period, Moody's will continue to examine the
possible outcomes of investor and lender discussions, as well as
the potential for replenishing the firm's capital base. Moody's
will also continue to assess the impact of potential asset
impairment charges on the company's earnings, capital, and
liquidity levels.
Moody's intends to conclude its review during the next 60 days.
The principal methodology used in this rating was Analyzing The
Credit Risks Of Finance Companies published in October 2000.
First Capital is a commercial finance company headquartered in
Boca Raton, FL.
FERRETERIA Y AGROCENTRO: Case Summary & Largest Unsec. Creditors
----------------------------------------------------------------
Debtor: Ferreteria Y Agrocentro El Siete, Inc.
RR-3 Box 10168
Toa Alta, PR 00953
Bankruptcy Case No.: 12-00756
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Victor Gratacos Diaz, Esq.
VICTOR GRATACOS-DIAZ LEGAL OFFICE
P.O. Box 7571
Caguas, PR 00726
Tel: (787) 746-4772
E-mail: bankruptcy@gratacoslaw.com
Scheduled Assets: $1,803,800
Scheduled Debts: $1,921,486
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/prb12-00756.pdf
The petition was signed by Jose L. Rodriguez Cruz, president.
GAME TRADING: Files for Chapter 11 Bankruptcy Protection
--------------------------------------------------------
Game Trading Technologies Inc. and its affiliate Gamers Factory
Inc. filed voluntary Chapter 11 petitions in the U.S. Bankruptcy
Court for the District of Maryland (Case No. 12-11519).
Chief Operating Officer Rodney Hillman said the companies will
continue to operate as debtors-in-possession under the
jurisdiction of the Bankruptcy Court.
On Nov. 22, 2011, Game Trading announced that, in view of its
current cash resources, expenses, debt and near term debt service
obligations, it intends to explore all strategic alternatives to
maintain the business as a going concern, including, but not
limited to, a possible sale or one or more other transactions that
may include a comprehensive financial reorganization of the
Company. McGuireWoods LLP has been retained as legal advisor to
the Company.
According to the Company, there can be no assurance that the
Company's exploration of strategic alternatives will result in the
Company pursuing any particular transaction or, if it pursues any
such transaction, that it will be completed. The Company said it
does not expect to make further public comment regarding its
consideration of strategic alternatives until the Board of
Directors has approved a specific course of action, deems
disclosure of significant developments is appropriate, or the
Company is legally required to do so.
Game Trading Technologies hired Marc Weinsweig --
marc@weinsweigadvisors.com -- the chief of WeinsweigAdvisors LLC,
as its chief restructuring officer to explore strategic
alternatives including a possible sale of the troubled company.
Citybizlist reports that the agreement was to last through
Jan. 16, 2012. Weinsweig's appointment followed a Nov. 22
decision of the Hunt Valley-based refurbisher of pre-owned video
games to seek alternatives following a cash crunch and debt
obligations. It then also hiredMcGuireWoods LLP as a legal
advisor.
Game Trading's balance sheet for Sept. 30, 2011, showed $8,095,030
in total assets, $14,900,872 in total liabilities, and $8,644,845
in stockholders' deficit.
Game Trading Technologies Inc. fka City Language Exchange, Inc.
(OTCBB:GMTD) filed for Chapter 11 protection (Bankr. D. Md. Lead
Case No. 12-11519) on Jan. 30, 2012. James Edward Van Horn, Jr.,
Esq., at McGuirewoods LLP, represents the Debtor.
GARDEN CITY: Moody's Affirms 'Ba3' Long Term Bond Rating
--------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 long-term debt
rating assigned to Garden City Hospital's (GCH) $6.2 million of
outstanding Series 1998A fixed rate bonds. GCH also has
approximately $46.9 million of Series 2007A fixed rate bonds
outstanding that are not rated by Moody's. The outlook remains
negative.
SUMMARY RATINGS RATIONALE
The affirmation of the Ba3 bond rating reflects GCH's status as a
stand-alone hospital located in the highly competitive and socio-
economically challenged metro-Detroit market with a trend of
operating losses and a consistent but weak absolute liquidity
position with little head room above the bond covenants.
Consultant and management initiated cost saving and revenue
enhancing initiatives that spurred inpatient admission and revenue
growth, and improved GCH's operating cash flow generation and debt
coverage ratios in fiscal year (FY) 2011. Management expects
continued improvement in FY 2012. The negative outlook reflects
the continuing challenges Moody's expects the Hospital to face in
order to grow volumes and improve financial performance in the
economically challenged service area. Continued financial
improvement that is sustainable would support a revision to stable
outlook.
STRENGTHS
*Improved operating cash flow generation in FY 2011, to $5.9
million (3.7% margin) compared to operating cash flow of $2.0
million (1.9% margin) recorded in FY 2010; improvement driven by
consultant and management initiatives implemented to redesign case
management structure and identify cost savings
*Growth in inpatient admissions and emergency room visits, driven
by improved emergency room turnaround; market share grew to 14.6%
in the first half of calendar year (CY) 2011 from 13.1% during the
full CY 2010
*Maintenance of balance sheet levels with absolute liquidity
holding at $25 million at fiscal yearend (FYE) 2011 equating to
cash on hand of 59 days, which remains unfavorable compared to
Moody's 2010 Ba median of 77 days
*All fixed rate debt removes interest rate and put risk; no new
debt anticipated in FY 2012 mitigating some pressure on balance
sheet measures
*Non-unionized staff
CHALLENGES
*Operating losses continue in FY 2011 despite improvement in
financial performance; the Hospital has reported operating losses
in three out of the last five years; losses improved to $3 million
(after reclassifying investment income from operating to non-
operating revenue as is Moody's practice) in FY 2011 compared to
$7.1 million in FY 2010
*Below average debt measures for the Ba-rating category with FY
2011 Moody's-adjusted debt-to-cash flow a high 10.4 times and
Moody's adjusted maximum annual debt service (MADS) coverage of
1.9 times (Moody's 2010 Ba median debt-to-cash flow is 5.1 times
and MADS coverage is 2.2 times); debt measures are improved over
FY 2010 when GCH reported Moody's-adjusted debt-to-cash flow a
high 45 times and Moody's adjusted MADS coverage of 0.95 times
(the debt service bond covenant is based on the obligated group's
results and differs from the Moody's adjust based on system
results)
*Heavy reliance on government payors representing 63% of gross
revenues (Medicare 45% and Medicaid 18%); expected cuts to
reimbursement rates from these payors will challenge GCH to
achieve positive operating income
*High age of plant (15.4 years at FYE 2011) due to low level of
capital spending the last three years; management plans to
increased capital spending in FY 2012 to a level equal to
depreciation expense, which will pressure liquidity levels if
operating performance does not improve above the level anticipated
*Significantly underfunded frozen defined benefit pension plan;
funding ratio at 64% at September 30, 2011, largely due to
reductions in the discount rate, the underfunded liability
increased materially to $23.0 million from $1.7 million at FYE
2008, which places additional stress on the balance sheet; no
contribution was made in fiscal years 2008, 2009, 2010, and 2011,
a contribution of $1.2 million is projected for FY 2012
*Stand-alone facility located in competitive and economically
challenged southeastern Michigan market with other sizable
hospitals providing a large array of services; however, the local
economy has stabilized somewhat and unemployment has improved
Outlook
The maintenance of the negative outlook reflects the risks
associated with the challenges of the local economy, the
competitive hospitals in the area that are part of larger health
systems with greater capital resources, GCH's thin liquidity
position, and the potential strains on maintaining or growing cash
with weak operating performance, an underfunded pension plan and
higher capital spending. Moody's notes the improved financial
performance and believe sustained improvement would indicate a
stable outlook for the Hospital.
WHAT COULD MAKE THE RATING GO UP
Unlikely given the negative outlook, however an upgrade would be a
function of material improvement in financial performance that is
sustainable and continued growth in cash flow improving debt
ratios; continued growth in inpatient and surgical volumes;
material gains in balance sheet ratios
WHAT COULD MAKE THE RATING GO DOWN
Downturn in operating performance from current levels; weaker
balance sheet ratios; decline in patient volumes; additional debt
without commensurate increase in cash flow
PRINCIPAL METHODOLOGY USED
The principal methodology used in this rating was Not-for-Profit
Hospitals and Health Systems published in January 2008.
GENCORP INC: Franklin Mutual Discloses 5.4% Equity Stake
--------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Franklin Mutual Advisers, LLC, disclosed
that, as of Dec. 31, 2011, it beneficially owns 3,183,737 shares
of common stock of GenCorp Inc. representing 5.4% of the shares
outstanding. A full-text copy of the filing is available for free
at http://is.gd/5MwcmW
About GenCorp Inc.
Rancho Cordova, Calif.-based GenCorp Inc. (NYSE: GY)
-- http://www.GenCorp.com/-- is a manufacturer of aerospace and
defense products and systems with a real estate segment that
includes activities related to the re-zoning, entitlement, sale,
and leasing of the Company's excess real estate assets.
The Company's balance sheet at Aug. 31, 2011, showed
$994.20 million in total assets, $1.13 billion in total
liabilities, $4.50 million in redeemable common stock, and a
$147.90 million total shareholders' deficit.
* * *
Standard & Poor's in February 2011 has raised its corporate credit
rating on GenCorp Inc. to 'B' from 'B-'. S&P also raised its
rating on the company's first-lien secured debt to 'BB-' from 'B+'
and on the subordinated debt to 'CCC+' from 'CCC'. The recovery
rating on the first-lien secured debt remains unchanged at '1',
and the recovery rating on the subordinated debt remains unchanged
at '6'. The outlook is stable.
"We are raising its ratings on GenCorp by one notch to reflect the
company's improved liquidity position," said Standard & Poor's
credit analyst Lisa Jenkins. "The ratings on GenCorp reflect its
highly leveraged capital structure, weak financial performance,
limited diversity, and modest scale of operations compared with
competitors. Offsetting these challenges to some extent is the
company's good niche positions in aerospace propulsion and solid
backlog. S&P characterize GenCorp Inc.'s business profile as weak
and its financial profile as highly leveraged."
As reported by the TCR on May 24, 2011, Moody's Investors Service
upgraded the corporate family and probability of default ratings
of GenCorp Inc. to B1 from B2. The upgrade reflects the Company's
steady improvement to operating results, as a leading niche
supplier of solid and liquid rocket propulsion systems to prime
defense contractors. Operating margins have grown to above 11%
(inclusive of Moody's standard adjustments) in the most recent
twelve-month period, resulting from growth in defense programs
that GenCorp supplies (THAAD, Aegis, PAC-3) and good cost
controls. GenCorp's funded backlog has grown steadily over
several years, and is now about 90% of sales. The level of
backlog provides good forward revenue visibility and compares
favorably with other defense suppliers.
GENERAL MARITIME: Files Plan and Related Disclosure Statement
-------------------------------------------------------------
On Jan. 31, 2012, General Maritime Corporation, et al., filed a
Chapter 11 Plan of Reorganization and a related Disclosure
Statement with the U.S. Bankruptcy Court for the Southern District
of New York.
A copy of the Plan is available for free at http://is.gd/6MfINZ
A copy of the related Disclosure Statement is available for free
at http://is.gd/suIUVd
Among other things, the Plan contemplates a rights offering by the
Company, as described in the Disclosure Statement and the Plan.
In the Rights Offering, eligible holders of general unsecured
claims will have the opportunity to purchase up to 17.5% of the
new equity of the reorganized Company on an undiluted basis for up
to $61.25 million. The Plan provides for a record date of Feb. 8,
2012 for determining generally the holders of general unsecured
claims that are eligible to participate in the Rights Offering,
although certain additional holders will also be permitted to
participate in the Rights Offering as described in the Plan. The
Rights Offering will be limited to those holders of general
unsecured claims that are either qualified institutional buyers or
accredited investors as defined by applicable securities laws.
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GENEVA STEEL: Ex-Kaye Scholer Atty Pleads Guilty But Dodges Jail
----------------------------------------------------------------
Carolina Bolado at Bankruptcy Law360 reports that a former Kaye
Scholer LLP partner on Wednesday pled guilty to one count of
making a false bankruptcy oath but escaped any jail time or fines
over his role as debtors' counsel in Geneva Steel Co.'s bankruptcy
case.
In exchange for the guilty plea, entered in Utah federal court
before U.S. District Judge Dee Benson, prosecutors agreed to drop
counts of bankruptcy and wire fraud in their case against Stephen
E. Garcia, the former Kaye Scholer attorney who worked on the
bankruptcy case of Geneva Steel, according to Law360.
Headquartered in Provo, Utah, Geneva Steel LLC owns and operates
an integrated steel mill. The Company filed for chapter 11
protection (Bankr. Utah Case No. 02-21455) on Jan. 25, 2002.
Andrew A. Kress, Esq., Keith R. Murphy, Esq., and Stephen E.
Garcia, Esq., at Kaye Scholer LLP, represent the Debtor in its
chapter 11 proceeding. James T. Markus was appointed as the
chapter 11 Trustee for the Debtor's estate on June 22, 2005. John
F. Young, Esq., at Block Markus & Williams, LLC represents the
chapter 11 Trustee. Dianna M. Gibson, Esq., and J. Thomas
Beckett, Esq., at Parsons Behle & Latimer, represent the Official
Committee of Unsecured Creditors. When the Company filed for
protection from its creditors, it listed $262 million in total
assets and $192 million in total debts.
The Hon. Glen E. Clark of the U.S. Bankruptcy Court for the
District of Utah, Central Division, confirmed Geneva Steel LLC
and its debtor-affiliates' joint chapter 11 plan of liquidation in
November 2006.
GLOBAL AVIATION: World Airways Files for Chapter 11
---------------------------------------------------
Global Aviation Holdings Inc., the parent company of World
Airways, Inc., North American Airlines, Inc. and other
subsidiaries, disclosed that to achieve a cost and debt structure
that is industry competitive and continue to provide outstanding
service to its customers, it has commenced a financial
restructuring through the voluntary filing of petitions to
reorganize under Chapter 11 of the U.S. Bankruptcy Code in the
United States District Court for the Eastern District of New York.
During the restructuring, the Company and its subsidiaries will
continue to operate as normal, without interruption.
The Company's Board of Directors determined that a Chapter 11
reorganization provides the most effective and efficient means to
restructure with minimal impact on the business, and is in the
best interest of the Company, its stakeholders and customers.
"Although the Company has worked closely with its lessors,
bondholders and other creditors and constituents over the past
year, which led to the reduction of certain obligations, the
Company needs to complete its comprehensive restructuring due to
having too large a fleet, labor costs that exceed industry
standards given the current global economic environment, and the
necessity to align the capital structure with the size of the
Company," said Robert Binns, Chairman and Chief Executive Officer
of Global.
Global has filed motions today with the Court seeking interim
relief that will ensure the Company's ability to continue all of
its normal operations, including the ability to provide employee
wages, healthcare coverage, vacation, and other benefits without
interruption; honor customer programs; and pay vendors and
suppliers for post-petition goods and services. Such motions are
standard and the Company anticipates receiving approval from the
Court within the next several days. Vendor and supplier invoices
incurred prior to the commencement of the Company's Chapter 11
case that have not been paid will be resolved through the
Company's Plan of Reorganization, which requires Court approval
and has yet to be submitted.
"Throughout this restructuring process, our customers, including
the United States Department of Defense, can continue to depend on
us to provide the same safe, high quality service they know and
have come to expect from us. We are committed to working as
quickly and efficiently as possible to appropriately restructure
Global so that it can emerge from Chapter 11 as a strong company,
well-positioned to compete effectively in the marketplace,"
continued Binns.
Global, through its subsidiaries World Airways and North American
Airlines, is the largest provider of military transport services
through the Air Mobility Command. World Airways was founded in
1948, and received its first government contract to provide
supplemental airlift to the U.S. military in 1951 during the
Korean conflict. North American, founded in 1989, also flies for
the U.S. military, as well as international and domestic charter
services to a broad customer base that includes major U.S.
corporations, domestic and international airlines, presidential
campaigns, the White House press corps, entertainers and
production companies.
Global's lead counsel in connection with the restructuring is
Kirkland & Ellis LLP and its financial advisor is Rothschild.
GLOBAL AVIATION: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Global Aviation Holdings Inc.
101 World Drive
Peachtree City, GA 30269
Bankruptcy Case No.: 12-40783
Debtor-affiliates that filed separate Chapter 11 petitions:
Debtor Case No.
------ --------
North American Airlines, Inc. 12-40782
Global Aviation Ventures SPV LLC 12-40784
Global Shared Services, Inc. 12-40785
New ATA Acquisition Inc. 12-40786
New ATA Investment Inc. 12-40787
World Air Holdings, Inc. 12-40788
World Airways, Inc. 12-40789
World Airways Parts Company, LLC 12-40790
Type of Business: Global Aviation Holdings Inc. provides
customized, non-scheduled passenger and
cargo air transport services. It provides
its services through its two operating air
carriers, World and North American, which
represent its two business segments.
Chapter 11 Petition Date: Feb. 5, 2012
Court: U.S. Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Carla E. Craig
Debtors'
Counsel : Jonathan Henes, Esq.
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, NY 10022
Tel: (212) 446-4800
Fax: (212) 446-4900
E-mail: jhenes@kirkland.com
Debtors'
Claims and
Noticing
Agent : KURTZMAN CARSON CONSULTANTS LLC
Total Assets: $589.8 million as of Dec. 31, 2011
Total Debts: $493.2 million as of Dec. 31, 2011
The petition was signed by Brian S. Gillman, senior vice
president, general counsel & corporate secretary.
Global Aviation Holdings Inc.'s List of Its 30 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
DFAS-CO/FPS/F Government $21,782,401
DFAS - Columbus Center Contract
Attn: DFAS-ADPSD/CA Fuels
Columbus, OH 43218-2204
Delta Airlines Trade Debt $9,200,971
1030 Delta Boulevard
Atlanta, GA 30320-6001
Evergreen Aviation Tech. Corp. Trade Debt $3,590,490
c/o Evergreen Aviation Tech. Corp.
No. 6 Harng Jann South Road
Taoyuan Hsien, Taiwan ROC
Flughafen Leipzig-Halle Trade Debt $3,074,575
Lieferanschrift Terminalring 11
04435 Flughafen Leipzig/Halle
Int?l Lease Finance Corp. Trade Debt $2,910,042
10250 Constellation Blvd
Suite 3400
Los Angeles, CA 90067
Boeing Company Trade Debt $1,828,893
FSB Training Center
4900 E. Conant Street
Long Beach, CA 90846
Pratt & Whitney Group Trade Debt $1,712,354
400 Main Street
M/S 124-18
East Hartford, CT 06108
United Aviation Services Trade Debt $1,526,986
Plot W-30 Box 54482
Dubai Airport Freezone Authority
Dubai, UAE
Disbursing Operations Director Trade Debt $1,080,671
Attn: 3801 Limestone Field Site
PO Box 269339
Indianapolis, IN 46226-9339
EUROCONTROL Trade Debt $1,021,574
Rue de la Loi 72
1040 Bruxelles
Belgium
World Fuel Services Trade Debt $998,281
9800 NW 41st Street
Suite 400
Miami, FL 33178
ASECNA Trade Debt $695,843
32-38 Avenue Jean Jaures
Dakar, Senegal
B.P. 3144
Honeywell Trade Debt $682,795
7825 Ridgepoint Drive
Irving, TX 75063
LSG Sky Chefs Deutschland Trade Debt $659,736
Dornhofst. 38
Neu-Isenburg 63263
Germany
Euro-Asia Air Services FZE Trade Debt $652,810
Dubai Airport Freezone
Office 4-A118
Dubai, UAE
Lufthansa Technik Trade Debt $564,611
Aktiengesellschaft
PO Box 630 300
Hamburg, Germany
Federal Aviation Administration Trade Debt $517,761
US Department of Transportation
Atlanta, GA 30320
Aercap Ireland Ltd Trade Debt $500,226
100 NE Third Avenue
Suite 800
Fort Lauderdale, FL 33301
Aquila Aircraft Leasing Ltd Trade Debt $497,000
Beaux Lane House
2nd Floor
Dublin 2
REVIMA - APU SAS Trade Debt $463,172
1 Avenue Du Latham 47
BP 12
France
Federal Express Corp Trade Debt $462,538
3268 Democrat Road
Memphis, TN 38101
ASIG - Atlanta Trade Debt $436,521
PO Box 2278
Carolstream, IL 60132-2278
V36 - MD11 LLC Trade Debt $396,000
915 Front Street
San Francisco, CA 94111
US Customs & Border Protection Trade Debt $392,621
Revenue Division User Fee Team
6650 Telecom Drive
Indianapolis, IN 46278
Penta Hotel Trade Debt $377,496
Grosser Brockhaus 3
D-04103 Leipzig
Leipzig, Germany
Kuwait Aviation Fueling Co KSC Trade Debt $357,665
Bank: National Bank of Kuwait
S.A.K.
Swift: NBOKKWKW
Unical Aviation Trade Debt $351,991
680 South Lemon Ave
City of Industry, CA 91789
QRS 15 Paying Agent Trade Debt $348,352
WP Carey & Company
50 Rockefeller Plaza
New York, NY 10020
Specialized Freight Forwarders Trade Debt $301,707
Anchoragelaan 30
Schiphol 1118LD, Netherlands
Cargolux Trade Debt $290,568
Luxembourg Airport
L-2990 Luxembourg Grand-Duchy of L
Luxembourg, GA 30269
HARRISBURG, PA: Bankruptcy Appeal Came Too Late, Judge Says
-----------------------------------------------------------
Amanda Bransford at Bankruptcy Law360 reports that U.S. District
Judge Sylvia Rambo on Wednesday said the city council of
Harrisburg's attempt to declare bankruptcy on behalf of the
beleaguered state capital could not go forward because its appeal
of the bankruptcy court's dismissal had come too late.
Judge Rambo said the city council, which tried to file for
Chapter 9 bankruptcy over the objection of city officials
including mayor Linda Thompson, had filed its appeal Dec. 10,
three days past the Dec. 7 deadline, Law360 relates.
About Harrisburg, Pennsylvania
The city of Harrisburg, in Pennsylvania, is coping with debt
related to a failed revamp of an incinerator. The city is
$65 million in default on $242 million owing on bonds sold to
finance an incinerator that converts trash to energy.
The Harrisburg city council voted 4-3 on Oct. 11, 2011, to
authorize the filing of a Chapter 9 municipal bankruptcy (Bankr.
M.D. Pa. Case No. 11-06938). The city claims to be insolvent,
unable to pay its debt and in imminent danger of having
tax revenue seized by holders of defaulted bonds.
Judge Mary D. France presided over the Chapter 9 case. Mark D.
Schwartz, Esq. and David A. Gradwohl, Esq., served as Harrisburg's
counsel. The petition estimated $100 million to $500 million in
assets and debts. Susan Wilson, the city's chairperson on Budget
and Finance, signed the petition.
Harrisburg said in court papers it is in imminent jeopardy through
six pending legal actions by creditors with respect to a number of
outstanding bond issues relating to the Harrisburg Materials,
Energy, Recycling and Recovery Facilities, which processes waste
into steam and electrical energy. The owner and operator of the
incinerator is The Harrisburg Authority, which is unable to pay
the bond issues. The city is the primary guarantor under each
bond issue. The lawsuits were filed by Dauphin County, where
Harrisburg is located, Joseph and Jacalyn Lahr, TD Bank N.A., and
Covanta Harrisburg Inc.
The Commonwealth of Pennsylvania, the County of Dauphin, and
Harrisburg city mayor Linda D. Thompson and other creditors and
interested parties objected to the Chapter 9 petition. The state
later adopted a new law allowing the governor to appoint a
receiver.
Kenneth W. Lee, Esq., Christopher E. Fisher, Esq., Beverly Weiss
Manne, Esq., and Michael A. Shiner, Esq., at Tucker Arensberg,
P.C., represented Mayor Thompson in the Chapter 9 case. Counsel to
the Commonwealth of Pennsylvania was Neal D. Colton, Esq., Jeffrey
G. Weil, Esq., Eric L. Scherling, Esq., at Cozen O'Connor.
In November 2011, the Bankruptcy Judge dismissed the Chapter 9
case because (1) the City Council did not have the authority under
the Optional Third Class City Charter Law and the Third Class City
Code to commence a bankruptcy case on behalf of Harrisburg and (2)
the City was not specifically authorized under state law to be a
debtor under Chapter 9 as required by 11 U.S.C. Sec. 109(c)(2).
That same month, the state governor appointed David Unkovic as
receiver for Harrisburg. Mr. Unkovic is represented by the
Municipal Recovery & Restructuring group of McKenna Long &
Aldridge LLP, led by Keith Mason, Esq., co-chair of the group.
HAWKER BEECHCRAFT: Bank Debt Trades at 22% Off
----------------------------------------------
Participations in a syndicated loan under which Hawker Beechcraft
is a borrower traded in the secondary market at 77.92 cents-on-
the-dollar during the week ended Friday, Feb. 3, 2012, an increase
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 200 basis points above LIBOR to borrow
under the facility. The bank loan matures on March 26, 2014, and
carries Moody's Caa2 rating and Standard & Poor's CCC rating. The
loan is one of the biggest gainers and losers among 168 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
The Company's balance sheet at Sept. 30, 2011, showed $3.10
billion in total assets, $3.49 billion in total liabilities and a
$383.20 million total deficit.
* * *
As reported by the Troubled Company Reporter on Sept. 16, 2011,
Moody's Investors Service has lowered all the credit ratings,
including the corporate family rating to Caa3 from Caa2, of Hawker
Beechcraft Acquisition Company LLC. The rating outlook is
negative.
The downgrades reflect Hawker Beechcraft's mounting retained
deficit and Moody's view that the soft economy dims chances for
profitability anytime soon. Although limited near-term debt
maturities exist, with the prospect of further losses Moody's
views the capital structure to be unsustainable. Pronounced risk
that some form of restructuring of the company's debt obligations
may occur underscores the negative rating outlook. Softness in
most developed economies should constrain demand for the smaller
and mid-sized cabin aircraft that comprise the company's Business
and General Aviation product portfolio. While management has
aggressively lowered overhead and cut production costs, the
revenue outlook seems weak. As of June 30, 2011, the debt to book
capital ratio was 114% and the trailing 12-month EBITDA to
interest ratio was 0.2x (Moody's adjusted basis)
In the Dec. 5, 2011 edition of the TCR, Standard & Poor's Ratings
Services lowered its ratings on Hawker Beechcraft, including the
corporate credit rating to 'CCC' from 'CCC+'. "The downgrade
reflects Hawker's continued poor credit protection measures and
tighter liquidity resulting from declining revenues, significant
(albeit improving) losses, and weak cash generation," said
Standard & Poor's credit analyst Christopher DeNicolo. "We have
concerns about the company's ability to maintain covenant
compliance."
HAWKER BEECHCRAFT: Bank Debt Trades at 21% Off
----------------------------------------------
Participations in a syndicated loan under which Hawker Beechcraft
is a borrower traded in the secondary market at 78.55 cents-on-
the-dollar during the week ended Friday, Feb. 3, 2012, an increase
of 0.72 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 850 basis points above LIBOR to borrow
under the facility. The bank loan matures on March 26, 2014, and
carries Standard & Poor's CCC rating. The loan is one of the
biggest gainers and losers among 168 widely quoted syndicated
loans with five or more bids in secondary trading for the week
ended Friday.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
The Company's balance sheet at Sept. 30, 2011, showed $3.10
billion in total assets, $3.49 billion in total liabilities and a
$383.20 million total deficit.
* * *
As reported by the Troubled Company Reporter on Sept. 16, 2011,
Moody's Investors Service has lowered all the credit ratings,
including the corporate family rating to Caa3 from Caa2, of Hawker
Beechcraft Acquisition Company LLC. The rating outlook is
negative.
The downgrades reflect Hawker Beechcraft's mounting retained
deficit and Moody's view that the soft economy dims chances for
profitability anytime soon. Although limited near-term debt
maturities exist, with the prospect of further losses Moody's
views the capital structure to be unsustainable. Pronounced risk
that some form of restructuring of the company's debt obligations
may occur underscores the negative rating outlook. Softness in
most developed economies should constrain demand for the smaller
and mid-sized cabin aircraft that comprise the company's Business
and General Aviation product portfolio. While management has
aggressively lowered overhead and cut production costs, the
revenue outlook seems weak. As of June 30, 2011, the debt to book
capital ratio was 114% and the trailing 12-month EBITDA to
interest ratio was 0.2x (Moody's adjusted basis)
In the Dec. 5, 2011 edition of the TCR, Standard & Poor's Ratings
Services lowered its ratings on Hawker Beechcraft, including the
corporate credit rating to 'CCC' from 'CCC+'. "The downgrade
reflects Hawker's continued poor credit protection measures and
tighter liquidity resulting from declining revenues, significant
(albeit improving) losses, and weak cash generation," said
Standard & Poor's credit analyst Christopher DeNicolo. "We have
concerns about the company's ability to maintain covenant
compliance."
HERON LAKE: Boulay Heutmaker Raises Going Concern Doubt
-------------------------------------------------------
Heron Lake BioEnergy, LLC, filed on Jan 30, 2012, its annual
report on Form 10-K for the fiscal year ended Oct. 31, 2011.
Boulay, Heutmaker, Zibell & Co. P.L.L.P., in Minneapolis, Minn.,
expressed substantial doubt about Heron Lake BioEnergy's ability
to continue as a going concern. The independent auditors noted
that the Company previously incurred operating losses related to
difficult market conditions and operating performance. The
Company was previously out of compliance with its master loan
agreement and had a lower level of working capital than was
desired.
The Company reported net income of $543,017 on $164.1 million of
revenues for fiscal 2011, compared with net income of $1.7 million
on $110.6 million of revenues for fiscal 2010.
The Company's balance sheet at Oct. 31, 2011, showed
$104.1 million in total assets, $54.6 million in total
liabilities, and members' equity of $49.5 million.
A complete text of the Form 10-K is available for free at:
http://is.gd/rXUget
Heron Lake BioEnergy, LLC, was organized as a Minnesota limited
liability company on April 12, 2001. The Company operated a dry
mill, coal fired ethanol plant in Heron Lake, Minnesota. After
completing a conversion in November 2011, the Company is now a
natural gas fired ethanol plant.
INDYMAC BANCORP: Judge Blasts Paul Hastings Lawyer Over Pleading
-------------------------------------------------------------
Patrick Fitzgerald, writing for Dow Jones' Daily Bankruptcy
Review, reports that Judge Dale S. Fischer of the U.S. District
Court in Los Angeles, California, blasted what she called Paul
Hastings lawyer Kirby Behre's overzealous and "somewhat annoying"
legal filings in a lawsuit by the Federal Deposit Insurance Corp.
against two former IndyMac officials.
"I don't have time for rhetoric. I'm really, really busy. . . .
I don't know whether you stay up nights trying to think of clever
phrases," the Hon. Dale S. Fischer told Kirby D. Behre, Esq., at
Paul Hastings LLP in course of a hearing in FDIC v. Van Dellen, et
al. (C.D. Calif. Case No. 10-04915) on Jan. 30, 2012, in response
to the litigation partner's "unpersuasive" and "somewhat annoying"
language in court filings, "but trust me," Judge Fischer said, "no
judge that I've ever spoken to has ever said, 'Boy, can that guy
turn a phrase.' They only say, 'Boy, why didn't he get to the
point.' So, please, in future pleadings, remember that."
A full-text copy of the hearing transcript is available at
http://clients.oakbridgeins.com/clients/blog/vandellem.pdfat no
charge.
Mr. Behre represents IndyMac executives Kenneth Shellem and
Richard Koon, who say the FDIC failed to collect and preserve
documents and emails after taking receivership of IndyMac
following the bank's 2008 collapse, leaving the pair handicapped
in mounting their defense.
According to the DBR report, Mr. Behre had called the FDIC's
alleged failure to preserve documents after it took over the bank
"staggering" and a "stunning display of incompetence."
According to the DBR report, the FDIC says it's "done everything
reasonably possible" to make available to defendants all of the
pertinent documents. Still, the defense lawyer was seeking
sanctions against the FDIC for spoliation of evidence.
DBR says Judge Fischer rejected the defendants' request, saying it
was "premature."
?That said, I'll turn to the government and tell you that I don't
think the government was nearly as diligent as its counsel
argues,? Judge Fischer said, addressing FDIC lawyer Thomas D.
Long. "It certainly could have done more than it did."
The judge said she "would certainly consider a jury instruction
targeted to certain evidence or certain issues" if given more
information.
The FDIC sued Messrs. Shellem, Koon and two other former
executives at IndyMac's home builders' division for $300 million.
The civil suit, filed about two years after the FDIC took over as
receiver, accused the executives of negligence by signing off on
commercial loans to home builders that had little chance of being
repaid.
About IndyMac Bancorp
Based in Pasadena, California, IndyMac Bancorp Inc. (NYSE:IMB) --
http://www.indymacbank.com/-- is the holding company for IndyMac
Bank FSB, a hybrid thrift/mortgage bank that originated mortgages
in all 50 states of the United States. Through its hybrid thrift-
mortgage bank business model, IndyMac designed, manufactured, and
distributing cost-efficient financing for the acquisition,
development, and improvement of single-family homes. IndyMac also
provided financing secured by single-family homes to facilitate
consumers' personal financial goals and strategically invests in
single-family mortgage-related assets.
On July 11, 2008, the Office of Thrift Supervision closed IndyMac
Bank and appointed FDIC as the bank's receiver. Thacher Proffitt
& Wood LLP was engaged as counsel to the FDIC.
Indymac Bancorp filed for Chapter 7 bankruptcy protection on
July 31, 2008 (Bankr. C.D.Calif., Case No. 08-21752).
Representing the Debtor are Dean G. Rallis, Jr., Esq., and John C.
Weitnauer, Esq. Bloomberg noted that Indymac had about
$32.01 billion in assets as of July 11, 2008. In court documents,
IndyMac disclosed estimated assets of $50 million to $100 million
and estimated debts of $100 million to $500 million.
INTEGRATED BIOPHARMA: Extends Imperium Forbearance Until Feb. 7
---------------------------------------------------------------
Biopharma, Inc., entered into a letter agreement, dated Jan. 30,
2012, by Imperium Advisers, LLC, as Collateral Agent on behalf of
Investors, and addressed to and acknowledged, accepted and agreed
to by the Company. The Seventh Amendment amended the Forbearance
Agreement, dated as of Oct. 4, 2011, by and between the Company
and the Collateral Agent, to (i) extend the termination date of
the Forbearance Agreement to Feb. 7, 2012, and (ii) provide that
any interest payments due and payable to the Collateral Agent by
the Company through Feb. 7, 2012, pursuant to the terms of the 8%
Senior Securities Notes of the Company will accrue and be due and
payable on Feb. 8, 2012.
About Integrated BioPharma
Based in Hillside, N.J., Integrated BioPharma, Inc. (INBP.OB) --
-- http://www.healthproductscorp.us/ -- is engaged primarily in
manufacturing, distributing, marketing and sales of vitamins,
nutritional supplements and herbal products. The Company's
customers are located primarily in the United States. The Company
was previously known as Integrated Health Technologies, Inc., and,
prior to that, as Chem International, Inc. The Company was
reincorporated in its current form in Delaware in 1995. The
Company continues to do business as Chem International, Inc., with
certain of its customers and certain vendors.
The Company reported a net loss of $2.28 million on $25.13 million
of net sales for the fiscal year ended June 30, 2011, compared
with a net loss of $5.53 million on $20.16 million of net sales
during the prior fiscal year.
The Company's balance sheet at Sept. 30, 2011, showed
$13.41 million in total assets, $20.73 million in total
liabilities, all current, and a $7.32 million total stockholders'
deficiency.
Friedman, LLP, in East Hanover, NJ, expressed substantial doubt
about the Company's ability to continue as a going concern. The
independent auditors noted that the Company has a working capital
deficiency, recurring net losses and has defaulted on its debt
obligations.
INTELLICELL BIOSCIENCES: Sells $790,000 Series D Preferred Shares
-----------------------------------------------------------------
Intellicell Biosciences, Inc., on Jan. 27, 2012, entered into a
securities purchase agreement with an accredited investor pursuant
to which the Company sold an aggregate of 12,500 shares of the
Company's series D convertible preferred stock and a warrant to
purchase 125,000 of the Company's common stock, for aggregate
gross proceeds of $250,000. On Dec. 15, 2011, this same investor
had purchased the same number of shares (12,500) of the Company's
series D preferred stock and warrants to purchase the same number
of shares of common stock (125,000) on the same terms and
conditions, for aggregate gross proceeds of $250,000.
On Jan. 30, 2012, the Company entered into securities purchase
agreements with two accredited investors pursuant to which the
Company sold an aggregate of 2,000 shares of the Company's series
D convertible preferred stock and warrants to purchase an
aggregate of 20,000 of the Company's common stock, for aggregate
gross proceeds of $40,000.
On Feb. 2, 2012, the Company entered into securities purchase
agreement, effective Dec. 15, 2011, with an accredited investor
pursuant to which the Company sold an aggregate of 12,500 shares
of our series D convertible preferred stock and a warrant to
purchase 125,000 shares of the Company's common stock, for
aggregate gross proceeds of $250,000.
The securities sold to each of the foregoing investors were sold
as units, each unit consisting of 2,500 shares of the Company's
series D convertible preferred stock and a warrant to purchase
25,000 of the Company's common stock.
Canadian License Agreement
On Dec. 15, 2011, the Company entered into an exclusive lab
services agreement with Regenastem, Inc., pursuant to which the
Company has granted Canadian Licensee the exclusive right and
license to the Company's stromal vascular fraction technology and
the Company's trademarks so that the Canadian Licensee can utilize
the Technology and Trademarks to provide tissue processing
services for humans and animals in Canada. The Canadian Agreement
will have an initial term ending on Aug. 26, 2031, and will
continue on successive five-year terms thereafter unless
terminated by either party. Either party may terminate the
Canadian Agreement, for among other things, the failure to cure a
material breach of the Canadian Agreement within 10 business days
or if either party makes an assignment for the benefit of
creditors, is adjudicated bankrupt or insolvent, commences
proceedings under bankruptcy law or Canadian Licensee is unable to
generate at least $500,000 in fees payable to the Company with any
18-month period during the Term. The Company may terminate the
Canadian Agreement, if among other things, Canadian Licensee fails
to follow the Company's protocol for tissue processing or if the
Canadian Licensee fails to report any tissue processing case to
the Company. If the Canadian Agreement is terminated for non-
performance, the Company will repurchase the license from the
Canadian Licensee for an amount equal to two times the license fee
earned by the Canadian Licensee through the date of that
termination.
In addition, Licensee agreed to invest $500,000 in the Company's
Series D Preferred Stock Financing, $250,000 of which was invested
after the signing of the Canadian License and the remaining
$250,000 of which was made on Jan. 27, 2012. The parties agree
that, within 120 days before the expiration of the Term, the
Canadian Licensee will pay a renewal fee of $500,000 for the next
10 years or two 5 year renewal terms in total. For each tissue
processing case performed by Canadian Licensee, the Canadian
Licensee shall pay the Company, on a monthly basis, a fee of 30%
of the fess designated by the Company for tissue processing. In
addition, for each Laboratory Facility set up by the Canadian
Licensee, the Canadian Licensee shall pay the Company 30% of the
net profit realized from the establishment of such Laboratory
Facility.
Australian License Agreement
On Dec. 16, 2011, the Company entered into an exclusive lab
services agreement with Cell-Innovations Pty Ltd. pursuant to
which the Company has granted Australian Licensee the exclusive
right and license to the Technology and Trademarks so that the
Australian Licensee can utilize the Technology and Trademarks to
provide tissue processing services for humans in Australia and New
Zealand. The Australian Agreement shall have an initial term
ending on Dec. 16, 2021, and will continue on successive one-year
terms thereafter unless terminated by either party upon 90 day
written notice. Either party may terminate the Australian
Agreement, for among other things, the failure to cure a material
breach of the Australian Agreement within 10 business days or if
either party makes an assignment for the benefit of creditors, is
adjudicated bankrupt or insolvent or commences proceedings under
bankruptcy law or if Australian Licensee is unable to generate at
least AUD$1,000,000 in fees payable to the Company with any 36-
month period during the Term. The Company may terminate the
Australian Agreement, if among other things, Australian Licensee
fails to follow the Company's protocol for tissue processing or if
the Australian Licensee fails to report any tissue processing case
to the Company. If the Australian Agreement is terminated for non-
performance as described above, the Company shall repurchase the
license from the Australian Licensee for an amount equal to two
times the license fee earned by the Australian Licensee through
the date of such termination.
In consideration for the grant of the exclusive license,
Australian Licensee agreed to pay the Company a one-time license
fee of $700,000 payable upon the execution of the Australian
Agreement.
Goldfard Advisory Agreement
Effective Feb. 1, 2012, Mr. Stuart Goldfarb, a former director of
the Company, agreed to serve on the advisory board of the Company.
In connection with becoming a member of the Company's advisory
board, Mr. Goldfarb and the Company entered into an advisory
agreement pursuant to which the Company agreed to issue Mr.
Goldfarb warrants to purchase 50,000 shares of common stock on a
quarterly basis for as long as he is an advisor to the Company.
The agreement has a term of two years from the date of execution.
At or near the date for the expiration of the term of the
agreement, the parties will discuss terms, if any, for the mutual
agreement to extend the term of the agreement.
About Intellicell Biosciences
Intellicell BioSciences, Inc., headquartered in New York, N.Y.,
was formed on Aug. 13, 2010, under the name "Regen Biosciences,
Inc." as a pioneering regenerative medicine company to develop and
commercialize regenerative medical technologies in large markets
with unmet clinical needs. On Feb. 17, 2011, the company changed
its name from "Regen Biosciences, Inc." to "IntelliCell
BioSciences Inc". To date, IntelliCell has developed proprietary
technologies that allow for the efficient and reproducible
separation of stromal vascular fraction (branded
"IntelliCell(TM)") containing adipose stem cells that can be
performed in tissue processing centers and in doctors' offices.
The Company's balance sheet at Sept. 30, 2011, showed $1.0 million
in total assets, $21.2 million in total current liabilities, and a
stockholders' deficit of $20.2 million.
"The Company has incurred losses since inception resulting in an
accumulated deficit of $20.1 million and a working capital deficit
of $21.0 million as of Sept. 30, 2011, respectively, however, if
the non-cash expense related to the Company's derivative liability
is excluded the accumulated deficit amounted to $3.1 million and
working capital deficit amounted to $3.7 million, respectively,?
the Company said in the filing.
"Further losses are anticipated in the continued development of
its business, raising substantial doubt about the Company's
ability to continue as a going concern."
INVESTORS LENDING: Court Okays Weiner as Special Attorney
---------------------------------------------------------
Investors Lending Group LLC obtained permission from the
Bankruptcy Court to employ Aron G. Weiner, and Weiner, Shearouse,
Weitz, Greenberg & Shawe, LLP, as special counsel to (a) handle
dispossessory and foreclosure proceedings; (b) prepare contracts
and handle real estate closings; and (c) other related matters
requiring the services of an attorney.
Mr. Weiner will be paid at his standard hourly rate of $275.
Aron G. Weiner, Esq., a member at Weiner, Shearouse, Weitz,
Greenberg & Shawe, LLP, assures the Court that his firm is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
About Investors Lending
Based in Savannah, Georgia, Investors Lending Group LLC filed for
Chapter 11 (Bankr. S.D. Ga. Case No. 11-41963) on Sept. 21, 2011.
Judge Lamar W. Davis Jr. presides over the case. James L. Drake,
Jr. P.C., acts as counsel to the Debtor. The Debtor scheduled
assets of $14,197,900 and debts of $18,634,570. The petition was
signed by Isaac L. Rabhan, CEO/assistant manager.
In November 2011, the U.S. Trustee for Region 21 appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Investors Lending. C. James McCallar, Jr.,
Esq., and Tiffany E. Caron, Esq., at McCallar Law Firm, in
Savannah, GA, represent the Committee.
INVESTORS LENDING: Wants to Renew Existing Loan With UCB
--------------------------------------------------------
Investors Lending Group, LLC, asks permission from the U.S.
Bankruptcy Court for the Southern District of Georgia to renew an
existing loan with United Community Bank.
On the Petition Date, the Debtor owed UCB roughly $500,000,
evidenced by a promissory note dated July 30, 2010, in the
original principal amount of $600,000, and secured by a first in
priority security deed, covering several real properties located
in Chatham County and Effingham County, Georgia. The Note matured
by its terms on Oct. 10, 2011.
According to the Debtor, UCB has agreed to renew the Note on these
terms:
a) Loan Amount: $500,000 (or current principal balance)
b) Term: 20 year amortization with a 35-month maturity
c) Payments: 34 payments of $3,390 each and 1 payment
estimated at $459,195
d) Interest Rate: 5.25% fixed
e) Release Prices:
$114,750 for 123 Harvest Drive, Springfield, Georgia
$127,500 for 106 Covenant Lane, Springfield, Georgia
$60,000 for 815 Elliot Street, Savannah, Georgia
$56,250 for 1527 Agate Street, Savannah, Georgia
$183,750 for 313 E. 52nd Street, Savannah, Georgia
$60,000 for 4021 First Street, Savannah, Georgia
$71,250 for 1224 and 1126 Murphy Avenue, Savannah, Georgia
f) Guarantors: Dr. Fred E. Rabhan and Ester Y. Rabhan
g) Fees: Recording fees, appraisal fees, etc. to be paid in
cash at closing, along with accrued and unpaid interest,
if any.
UCB is advancing no new money to the Debtor under the transaction.
About Investors Lending
Based in Savannah, Georgia, Investors Lending Group LLC filed for
Chapter 11 (Bankr. S.D. Ga. Case No. 11-41963) on Sept. 21, 2011.
Judge Lamar W. Davis Jr. presides over the case. James L. Drake,
Jr. P.C., acts as counsel to the Debtor. The Debtor scheduled
assets of $14,197,900 and debts of $18,634,570. The petition was
signed by Isaac L. Rabhan, CEO/assistant manager.
In November 2011, the U.S. Trustee for Region 21 appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Investors Lending. C. James McCallar, Jr.,
Esq., and Tiffany E. Caron, Esq., at McCallar Law Firm, in
Savannah, GA, represent the Committee.
JENNE HILL: Court to Consider Cash Collateral Motion on Feb. 16
---------------------------------------------------------------
Jenne Hill Townhomes, L.L.C., asks the U.S. Bankruptcy Court for
the Western District of Missouri for authority to use Cash
Collateral "for a period of 90 days from the date the Court enters
its order on the final hearing on Debtor's use of Cash
Collateral."
Wells Fargo, N.A, as successor in interest to Regions Bank, holds
a senior deed of trust on the Debtor's complex of high end
townhomes in Columbia, Missouri, securing two notes that Debtor
executed in favor of Regions. The current balance on the Notes is
approximately $9,700,000.
On Jan. 20, 2012, the Court entered its order setting the hearing
to consider the motion for an interim order authorizing use of
cash collateral for Feb. 16, 2012, at 9:00 a.m.
The Debtor tells the Court that the appraised value of the real
Property is $13,000,000, and, accordingly, Wells Fargo's interest
in the Cash Collateral is adequately protected by the equity
cushion it enjoys in the Real Property.
As additional adequate protection for the use of Cash Collateral,
Debtor will provide Wells Fargo with a monthly payment of $48,000,
which is approximately the pre-petition obligation under the
Notes.
Wells Fargo objects to the Debtor's motion for interim
authorization to use cash collateral, citing:
1. The value of the real property is far below the amount the
Debtor claims;
2. To the extent that the rentals are a separate asset from the
realty under the law, there is no provision for providing
postpetition liens on unencumbered property to give Wells
Fargo the indubitable equivalent of its lien on rents.
3. Certain of the proposed uses of cash collateral are
unreasonable in amount or should be paid from other sources
than the cash collateral.
4. The amount of $4,000 per month provided in the budget for
"Chapter 11 Legal/Accounting" is excessive and should be
addressed, if at all, upon final hearing of the motion.
5. Payments of adequate protection should be made due
immediately for Jan. 1, 2012, and also on every 1st of the
month thereafter while the Order is in force.
6. The proposed Interim Order should provide that the monthly
reserve for property taxes should be paid to Wells Fargo's
designee to hold for the payment of such property taxes in
December 2012.
7. The proposed Interim Order fails to require that all
insurance be maintained and that any changes in loss payees
or insured that are required because of the filing of this
Chapter 11 proceeding should continue to name Wells Fargo
Bank, N.A., as loss payee or additional insured.
8. The proposed Interim Order does not require Debtor to
provide monthly financial reports to Wells Fargo Bank, N.A.,
or its agent by the 15th of each month, or to provide copies
of the monthly operating reports to the Court, so that the
use of cash collateral may be monitored.
9. The recitation of the alleged non-perfection of Wells
Fargo's lien on rents in paragraphs 10-13 of Debtor's Motion
is erroneous as a matter of law. The proposed Conclusion of
Law regarding the same, paragraph 11 of the proposed Order,
is also erroneous.
Counsel for Wells Fargo Bank, N.A., may be reached at:
James S. Cole, Esq.
THE WASINGER LAW GROUP, P.C.
1401 S. Brentwood Blvd., Suite 875
St. Louis, MO 63144
Tel: (314) 961-0400
Fax: (314) 961-2726
E-mail: jcole@wasingerlawgroup.com
Columbia, Missouri-based Jenne Hill Townhomes, L.L.C., is a
Missouri limited liability company that owns and operates a
complex of high end townhomes in Columbia, Missouri. The Debtor
filed for Chapter 11 bankruptcy (Bank. W.D. Mo. Case No.11-22129)
on Dec. 22, 2011. In its schedules, the Debtor disclosed
$14,131,453 in assets and $9,743,209 in liabilities.
The petition was signed by Fredd Spencer, manager. Judge Dennis
R. Dow presides over the case. Bryan C. Bacon, Esq., at Van
Matre, Harrison, Hollis, and Taylor, P.C., in Columbia, Missouri,
serves as the Debtor's counsel.
JENNE HILL: Files Schedules of Assets and Liabilities
-----------------------------------------------------
Jenne Hill Townhomes, L.L.C., filed with the U.S. Bankruptcy Court
for the Western District of Missouri its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $14,000,000
B. Personal Property $131,453
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $9,720,004
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $23,205
----------- -----------
TOTAL $14,131,453 $9,743,209
A copy of the schedules is available for free at:
http://bankrupt.com/misc/jennehill.sal.pdf
Columbia, Missouri-based Jenne Hill Townhomes, L.L.C., filed for
Chapter 11 bankruptcy (Bank. W.D. Mo. Case No.11-22129) on
Dec. 22, 2011. The Company estimated assets of $10 million to $50
million and estimated debts of $1 million to $10 million. The
petition was signed by Fredd Spencer, manager. Judge Dennis R.
Dow presides over the case. Bryan Bacon, Esq., at Van Matre
Harrison Hollis & Taylor P.C., serves as the Debtor's counsel.
JOBSON MEDICAL: Plan Deal Requires Ch. 11 Exit in March
-------------------------------------------------------
Jobson Medical Information Holdings LLC, a health-care information
and service provider, filed for Chapter 11 bankruptcy protection
(Bankr. S.D.N.Y. Case No. 12-bk-10434) in New York.
Jobson Medical is a medical information and education company.
Closely held Jobson, based in New York, works with pharmacies,
clinics, government and employer groups as well as specialty
medical groups to deliver medical information.
"The Debtors are operationally and financially sound. The Debtors
have strong customer relationships, stable accounts receivable and
are generally current with payments to their vendors. The Debtors'
diversification has allowed them to consistently generate strong
Results," CFO Derek Winston said in a court filing.
The Debtor, which sought bankruptcy along with 16 affiliates,
estimated assets and debt of as much as $500 million each in its
petition. Jobson Medical Information Holdings has a $117.3
million secured loan from General Electric Capital Corp., as
agent. The maturity of the loan in December prompted the filing.
Jobson Medical has a pre-packaged bankruptcy plan that gives the
company three more years to pay off its loan and grants its
secured lender equity in the new company.
Under the Plan, maturity of first-lien debt will be extended by
three years and the lenders owed $117.4 million will be given 20%
of the equity. Unsecured creditors with claims totaling about
$2 million will be paid in full. The Plan allows the Class A
shareholders to retain 80% of the new stock. The existing Class B
shareholders retain nothing.
Kurtzman Carson Consultants, the Debtors' voting and proposed
claims and notice agent, certified that secured lenders and
holders of the Class A equity have approved the Plan. The Debtors
solicited votes on the Plan in January.
The agreement to support the plan requires approval from the
bankruptcy court through a confirmation order no later than
March 23. The agreement also requires consummation of the Plan
by March 26.
The Debtors say the milestones provide them with sufficient time
necessary to achieve the goals of the restructuring.
KEOKUK HOSPITAL: Moody's Downgrades Bond Rating to 'Caa3'
---------------------------------------------------------
Moody's Investors Service has downgraded Keokuk Area Hospital's
(KAH) bond rating to Caa3 from Caa2. The downgrade affects
approximately $5.1 million of outstanding Series 1998 revenue
bonds issued through the City of Keokuk, IA. The rating outlook
remains negative.
RATINGS RATIONALE
SUMMARY RATING RATIONALE: The downgrade to Caa3 from Caa2 and
negative outlook reflect KAH's continued deteriorating operating
performance (-0.9% operating cash flow margin in fiscal year 2011)
and balance sheet position (10.9 days cash on hand and 12.0% cash-
to-debt at fiscal year end 2011). Based on Moody's assessment of
KAH's security for the Series 1998 bonds, other debt and liability
obligations, and available assets that could be available to
bondholders in the event of default, Moody's believes KAH's
recovery given a possible default would be substantially less than
100% but above a complete loss. Moody's does not expect a default
in FY 2012.
CHALLENGES
*Very weak liquidity position with 10.9 days cash on hand and
12.0% cash-to-debt at fiscal year end (FYE) 2011 (September 30
year end).
*Very weak operating results in FY 2010 (1.6% operating cash flow
margin) and FY 2011 (-0.9% operating cash flow margin) leading to
stressed adjusted debt ratios (-21.3 times debt-to-cash flow and
0.03 times maximum annual debt service coverage in FY 2011).
*KAH did not meet its minimum debt service coverage ratio covenant
of 120% in FY 2010 and FY 2011, resulting in the hospital engaging
a consultant to identify improvement initiatives to comply with
bond requirements.
*Small hospital in a challenging service area, as Medicare,
Medicaid, and self-pay represented approximately 73.5% of gross
revenues in FY 2011. Population in Lee County has been declining
in recent years and the median household income level is below
state and national averages.
*Modest capital spending in recent years has led to a high average
age of plant of 17.3 years at FYE 2011 (all ratings median is 10.3
years).
STRENGTHS
*Fully funded debt service reserve fund
*With the assistance of a consultant, KAH is implementing a number
of expense savings and revenue enhancements that should result in
improved operating performance and allow KAH to maintain cash at
least through FY 2012.
*All fixed rate debt, no operating leases, and a defined
contribution pension plan.
Outlook
The negative outlook reflects KAH's continued weak operating
performance in FY 2011 and stressed balance sheet ratios that
Moody's believes may lead to a payment default and low recovery
values.
WHAT COULD MAKE THE RATING GO UP
An upgrade is unlikely in the near-term; over the longer term,
material liquidity gains without additional debt, sustained
operating improvement, and reversal of recent patient volume
losses
WHAT COULD MAKE THE RATING GO DOWN
Continued decline in absolute cash and investments leading to even
weaker liquidity ratios; continued volume declines and weak
operating results; bond payment default or bankruptcy;
deterioration in expected recovery given default estimates
PRINCIPAL METHODOLOGY USED
The principal methodology used in this rating was Not-for-Profit
Hospitals and Health Systems published in January 2008.
KODIAK ENERGY: Majority Owned Subsidiary Files for CCCA Protection
------------------------------------------------------------------
In a Form 8-K filing Friday, Kodiak Energy, Inc., disclosed that
its majority owed subsidiary, Cougar Oil & Gas Canada Inc., has
filed for creditor protection under the Canadian creditor
protection statutes. Kodiak has guarantees aggregating
Cdn$5,200,000 to creditors of Cougar and has a loan in the amount
of approximately $1,300,000 to Cougar. The management of Kodiak
cannot predict the outcome of the creditor protection and its
effect on the debt of Cougar to Kodiak or the extent to which the
guarantees provided by Kodiak will be called upon by the creditors
of Cougar.
A copy of the Form 8K is available for free at:
http://is.gd/YHD5oQ
Calgary, Canada-based Kodiak Energy, Inc., engages in the
exploration, development, production and sale of oil and natural
gas in Canada and the United States.
The Company reported a net loss of US$5.5 million on
US$2.0 million of total revenue for the nine months ended
Sept. 30, 2011, compared with a net loss of US$6.1 million on
US$2.4 million of revenue for the same period of 2010.
For the fiscal year ended Dec. 31, 2010, the Company has reported
a net loss of US$7.7 million on US$3.1 million of total revenue as
compared to a net loss of US$20.0 million on US$607,469 of total
revenue for the fiscal year ended Dec. 31, 2009.
The Company's balance sheet at Sept. 30, 2011, showed
US$32.2 million in total assets, US$13.1 million in total
liabilities, and stockholders' equity of US$19.1 million.
* * *
RBSM LLP, in New York, N.Y., expressed substantial doubt about
Kodiak Energy's ability to continue as a going concern, following
the Company's results for the fiscal year ended Dec. 31, 2010.
The independent auditors noted that the Company has incurred
operating losses and has a working capital deficiency.
LE-NATURE'S INC: Judge Rejects Bids to Stop $500M Clawback Suit
---------------------------------------------------------------
Amanda Bransford at Bankruptcy Law360 reports that U.S. District
Judge Donetta W. Ambrose on Thursday rejected CIT Group/Equipment
Financing Inc.'s and Krones Inc.'s bids to toss a $500 million
clawback suit, upholding her previous refusal to dismiss the case
in multidistrict litigation over Le-Nature's Inc.'s $668 million
accounting fraud that sent the bottling company into bankruptcy.
About Le-Nature's Inc.
Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. --
http://www.le-natures.com/-- made bottled waters, teas, juices
and nutritional drinks. Its brands included Kettle Brewed Ice
Teas, Dazzler fruit juice drinks and lemonade, and AquaAde
vitamin-enriched water.
Four unsecured creditors of Le-Nature's filed an involuntary
Chapter 7 petition against the Company (Bankr. W.D. Pa. Case No.
06-25454) on Nov. 1, 2006. On Nov. 6, 2006, two of Le-Nature's
subsidiaries, Le-Nature's Holdings Inc., and Tea Systems
International Inc., filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code. Judge McCullough converted Le
Nature's Inc.'s case to a Chapter 11 proceeding. The Debtors'
cases are jointly administered. The Debtors' schedules filed with
the Court showed $40 million in total assets and $450 million in
total liabilities.
Douglas Anthony Campbell, Esq., Ronald B. Roteman, Esq., and
Stanley Edward Levine, Esq., at Campbell & Levine, LLC, represent
the Debtors in their restructuring efforts. The Court appointed
R. Todd Neilson as Chapter 11 Trustee. Dean Z. Ziehl, Esq.,
Richard M. Pachulski, Esq., Stan Goldich, Esq., Ilan D. Scharf,
Esq., and Debra Grassgreen, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub LLP, represent the Chapter 11 Trustee.
David K. Rudov, Esq., at Rudov & Stein, and S. Jason Teele, Esq.,
and Thomas A. Pitta, Esq., at Lowenstein Sandler PC, represent the
Official Committee of Unsecured Creditors. Edward S. Weisfelner,
Esq., Robert J. Stark, Esq., and Andrew Dash, Esq., at Brown
Rudnick Berlack Israels LLP, and James G. McLean, Esq., at Manion
McDonough & Lucas represent the Ad Hoc Committee of Secured
Lenders. Thomas Moers Mayer, Esq., and Matthew J. Williams, Esq.
at Kramer Levin Naftalis & Frankel LLP, represent the Ad Hoc
Committee of Senior Subordinated Noteholders.
In July 2008, the Chapter 11 plan of liquidation for Le-Nature's
took effect.
LEE ENTERPRISES: KPMG Removes Going Concern Doubt in FY2011 Report
------------------------------------------------------------------
Lee Enterprises, Incorporated, filed on Feb. 3, 2012, Amendment
No. 1 to its annual report for the fiscal year Sept. 25, 2011, to
update certain sections of the annual report on Form 10-K filed
with the Securities and Exchange Commission on Dec. 9, 2011, with
regard to the consummation of the Company's debt refinancing and
the conclusion of voluntary proceedings under Chapter 11 of the
U.S. Bankruptcy Code as of Jan. 30, 2012.
In addition, this Amendment reflects the removal by the Company's
independent registered public accounting firm, KPMG LLP, from its
report on the Company's Consolidated Financial Statements of an
explanatory paragraph expressing substantial doubt regarding the
Company's ability to continue as a going concern.
A copy of the Form 10-K/A is available for fee at:
http://is.gd/NStOMM
About Lee Enterprises
Lee Enterprises, Incorporated, headquartered in Davenport, Iowa,
publishes the St. Louis Post Dispatch and the Arizona Daily Star
along with more than 40 other daily newspapers and about 300
weekly newspapers and specialty publications in 23 states.
Revenue for the 12 months ended December 2010 was $780 million.
The Company has 6,200 employees, with 4,650 working full-time.
Lee Enterprises and certain of its affiliates filed for Chapter 11
(Bankr. D. Del. Lead Case No. 11-13918) on Dec. 12, 2011, with a
prepackaged plan of reorganization. The Debtor selected Sidley
Austin LLP as its general reorganization and bankruptcy counsel,
and Young Conaway Stargatt & Taylor LLP as co-counsel; The
Blackstone Group as Financial and Asset Management Consultant; and
The Debtor disclosed total assets of $1.15 billion and total
liabilities of $1.25 billion at Sept. 25, 2011.
Deutsche Bank Trust Company Americas, as DIP Agent and Prepetition
Agent, is represented in the Debtors' cases by Sandeep "Sandy"
Qusba, Esq., and Terry Sanders, Esq., at Simpson Thacher &
Bartlett LLP.
Certain Holders of Prepetition Credit Agreement Claims, Goldman
Sachs Lending Partners LLC, Mutual Quest Fund, Monarch Master
Funding Ltd, Mudrick Distressed Opportunity Fund Global, LP and
Blackwell Partners, LLC have committed to acquire up to a maximum
amount of $166.25 million of loans under a New Second Lien Term
Loan Facility pursuant to the Reorganization Plan. This
commitment also includes the potential payment of up to $10
million as backstop cash to Reorganized Lee Enterprises to acquire
the loans. The Initial Backstop Lenders are represented by
Matthew S. Barr, Esq., and Brian Kinney, Esq., at Milbank, Tweed,
Hadley & McCloy LLP.
On Jan. 23, 2012, Lee Eenterprises, et al., won confirmation of
a second version of their prepackaged Chapter 11 plan of
reorganization.
Lee Enterprises Inc. declared its prepackaged plan of
reorganization effective on Jan. 30, 2012.
LEVEL 3: Thornburg Investment Discloses 3.8% Equity Stake
---------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Thornburg Investment Management Inc.
disclosed that, as of Dec. 31, 2011, it beneficially owns
7,909,252 shares of common stock of Level 3 Communications
representing 3.81% of the shares outstanding. A full-text copy of
the filing is available for free at http://is.gd/81cHnf
About Level 3 Communications
Headquartered in Broomfield, Colorado, Level 3 Communications,
Inc., is a publicly traded international communications company
with one of the world's largest communications and Internet
backbones.
The Company's balance sheet at Sept. 30, 2011, showed $9.25
billion in total assets, $9.77 billion in total liabilities and a
$523 million total stockholders' deficit.
Level 3 Communications carries a 'Caa1' corporate family rating,
and 'Caa2' probability of default rating, with negative outlook
from Moody's, a 'B-' issuer default rating from Fitch, and 'B-'
long term issuer credit ratings from Standard & Poor's.
LIBERATOR INC: To Be Featured on Steve Crowley's Radio Program
--------------------------------------------------------------
Liberator, Inc., announced that Chief Marketing Officer, Michael
Kane, will be featured on the American Scene national radio
program with Steve Crowley today at 11:24 am Eastern Standard
Time. Listeners can tune in at: www.moneychannel.tv to hear the
interview.
Steve Crowley's American Scene national radio show, owned by the
Money Channel Inc., airs for three hours daily Monday through
Friday. American Scene has over 3,000,000 listeners on the three-
hour daily radio broadcasts and airs on hundreds of radio channels
nation-wide through the IRN/USA Radio Network affiliates.
"We had the pleasure of being interviewed by Steve Crowley at the
FSX Conference in Dallas this past week and look forward to
sharing this interview with his national radio audience,"
commented Mr. Kane, Chief Marketing Officer at Liberator.
"Liberator is a pioneer and early leader in the sexual health &
wellness industry, having sold over $60 million worth of our
branded Liberator products to date. As we continue to expand our
sales and increase our awareness in 2012, be believe Liberator is
uniquely positioned to benefit from the rapid shift to mainstream
demand for sexual products, as exemplified by our expansion into
mass market retailers such as Walgreens.com and Drugstore.com."
In addition to the national radio program American Scene, Money
Channel also produces a national weekly television program,
WallStreetCast, which airs on the FOX Business Network during
certain times of the year. American Scene was launched nationally
in June 1990, and WallStreetCast has been produced since 2005.
Both programs feature more than 200 well-known financial experts
that are interviewed in constant rotation, from Steve Forbes,
Tobin Smith, Beth Dater, Larry Kudlow plus many more.
About Liberator Inc.
Headquartered in Atlanta, Georgia, Liberator, Inc. is a provider
of goods and information to consumers who believe that sensual
pleasure and fulfillment are essential to a well-lived and healthy
life. The information that the Company provides consists
primarily of product demonstration videos that the Company shows
on its websites and instructional DVD's that the Company sells.
The Company reported a net loss of $801,252 on $17.32 million of
net sales for the year ended June 30, 2011, compared with a net
loss of $1.03 million on $11.07 million of net sales during the
prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$6.64 million in total assets, $5.44 million in total liabilities,
and $1.19 million in total stockholders' equity.
Gruber & Company, LLC, in Lake Saint Louis, Missouri, noted that
conditions exist which raise substantial doubt about the Company's
ability to continue as a going concern unless it is able to
generate sufficient cash flows to meet its financing requirements
and attain profitable operations.
LICHTIN/WADE LLC: Files for Chapter 11 in Wilson, NC
----------------------------------------------------
Lichtin/Wade, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
E.D.N.C. Case No. 12-00845) on Feb. 2, 2012.
According to the docket, a Section 341(a) meeting of creditors is
scheduled for March 15, 2012 at 10:00 a.m. Proofs of claim are
due by June 13, 2012.
There's also an order to file a plan and disclosure statement by
May 2, 2012. A status hearing will be held March 5, 2012 before
Judge Randy D. Doub.
The Debtor estimated less than $50 million in assets and debts.
The Debtor owns property in Wade Park Boulevard, in Raleigh North
Carolina.
LIMITED BRANDS: Moody's Rates Proposed $750-Mil. Notes at 'Ba1'
---------------------------------------------------------------
Moody's Investors Service rated Limited Brands' proposed $750
million senior unsecured guaranteed notes Ba1. All other ratings
were affirmed including the Ba1 Corporate Family and Probability
of Default Ratings. The rating outlook is stable.
This rating is assigned
$750 million senior unsecured guaranteed notes at Ba1 (LGD 3, 44%)
These ratings are affirmed and LGD point estimates changed
Corporate Family Rating at Ba1
Probability of Default Rating at Ba1
Senior unsecured guaranteed notes at Ba1 (LGD 3, to 44% from 41%)
Senior unsecured unguaranteed notes at Ba2 (LGD 5, to 89% from
86%)
Senior unsecured unguaranteed shelf to (P) Ba2
Subordinated shelf at (P) Ba3
Preferred shelf at (P) Ba3
RATINGS RATIONALE
The proceeds of the proposed $750 million in senior unsecured
notes are anticipated to be used for share repurchases. The
affirmation of Limited Brands' Ba1 Corporate Family Rating
reflects that leverage will only slightly increase and that the
increase will be temporary. Moody's estimates that debt to EBITDA
pro forma for the transaction for the year ending January 28, 2011
will be 3.7 times as compared to 3.3 times currently. Over the
next twelve months, earnings improvements will likely result in
debt to EBITDA falling to 3.5 times.
Limited Brands' Ba1 Corporate Family Rating is supported by its
strong profitability, very good liquidity, and moderate leverage
with debt to EBITDA about 3.5 times. The rating considers Limited
Brands' scale with revenues about $10 billion and its
concentration on two narrow product niches. The rating also
acknowledges its expertise in merchandise and marketing as well as
its portfolio of well-recognized brand names. However, Limited
Brands' financial policies favor share repurchases and special
dividends which places limits on its rating as does the fact that
its credit agreement provides it with tremendous flexibility to
make debt financed dividends and share repurchases.
The stable outlook reflects Moody's view that the increase in
Limited Brands' leverage will only be temporary as earnings growth
will offset the increase in debt bringing debt to EBITDA to 3.5
times over the next twelve months. The stable outlook also
reflects Moody's view that Limited Brands' financial policies will
continue to be shareholder friendly and that any earnings growth
and excess cash flow will be returned to shareholders but that
Limited Brands will maintain credit metrics appropriate for the
Ba1 rating.
An upgrade would require further comfort on Moody's part that
Limited Brands' financial policies will remain balanced and
prudent such that they would support the company maintaining solid
credit metrics and good liquidity. Quantitatively, an upgrade
would require Limited Brands to maintain debt to EBITDA below 3.0
times and EBITA to interest expense above 4.5 times.
Ratings could be downgraded should financial policy become more
aggressive than currently anticipated. Ratings could also be
downgraded should debt increase or operating performance falter
such that debt to EBITDA approaches 4.5 times or EBITA to interest
expense approaches 2.5 times.
The principal methodology used in rating Limited Brands Inc. was
the Global Retail Industry Methodology published in June 2011.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Headquartered in Columbus, Ohio, Limited Brands, Inc. operates
about 2,623 specialty stores in the United States under the
Victoria's Secret, Bath & Body Works, C.O. Bigelow, Pink, La
Senza, White Barn Candle Co., and Henri Bendel name plates. Its
brands are also sold on-line and in more than 600 company operated
and franchised additional locations worldwide. Annual revenues are
about $10.3 billion.
LIMITED BRANDS: Moody's Says Ba1 CFR Unaffected by Note Increase
----------------------------------------------------------------
Moody's Investors Service stated that Limited Brands, Inc. Ba1
Corporate Family Rating and stable outlook are not impacted by the
increase to its previously announced $750 million notes offering
to $1 billion.
The principal methodology used in rating Limited Brands, Inc. was
the was the Global Retail Industry Methodology published in June
2011.
Headquartered in Columbus, Ohio, Limited Brands, Inc. operates
about 2,623 specialty stores in the United States under the
Victoria's Secret, Bath & Body Works, C.O. Bigelow, Pink, La
Senza, White Barn Candle Co., and Henri Bendel name plates. Its
brands are also sold on-line and in more than 600 company operated
and franchised additional locations worldwide. Annual revenues are
about $10.3 billion.
LIMITED BRANDS: Fitch Assigns 'BB+' Rating to $750-Mil. Notes
-------------------------------------------------------------
Fitch Ratings has assigned a rating of 'BB+' to Limited Brands,
Inc. (Limited Brands) $750 million senior guaranteed unsecured
notes due 2022 and 2024. The notes will be guaranteed on an
unsecured basis by each of the subsidiaries that guarantee the
senior credit facility, the $500 million 8.5% senior notes due
2019, the $400 million 7% senior notes due 2020 and the $1,000
million 6.625% senior notes due 2021. The net proceeds of the
offering will be used for general corporate purposes, including
capital expenditures, share repurchases and dividends.
The ratings continue to reflect Limited Brands' strong brand
recognition and dominant market positions in intimate apparel and
personal care and beauty products, strong operating results,
reasonable credit metrics, solid cash flow generation and good
liquidity. The ratings also consider the company's track record
of shareholder-friendly activities.
Fitch has a favorable view of the business profile given the
diversity of its two profitable flagship brands, Victoria's Secret
and Bath & Body Works, as well as a strong direct business, and a
growing international effort. Both concepts have been successful
in keeping merchandise fresh and current, which has fueled strong
comparable store sales, enhanced customer loyalty, and optimized
markdown activity. At 15% -- 20% of operating profits, the large
catalog and Internet business is a positive for operating margins,
and extends the reach of the brands.
Financial performance has shown a significant rebound since the
2008 - 2009 period. Comparable store sales were 9% in 2010 and 10%
for 2011 (fiscal year ended Jan. 28, 2012), robust in comparison
to the negative 9% and negative 4% results from 2008 and 2009,
respectively. In addition to positive operating leverage from the
favorable comp trendline, the company has driven margin growth
through efficient inventory management. EBITDA margins in the
18%-context are solid in comparison to the broader retail average
in the low teens.
Pro forma for the new unsecured notes, lease-adjusted leverage is
3.6x, increasing about 0.4x, which is within the context of the
existing rating level. Fitch generally expects the company to
maintain a leverage profile in the mid-3x area, directing FCFs
toward dividends and share repurchases. There is no change in the
company's shareholder-friendly posture. Limited Brands remains
committed to returning cash to shareholders through share
repurchases and dividends. This posture is a key constraint to
the rating. More significant debt-financed share repurchases
could be a concern for the rating.
Comparisons will be difficult for 2012 given the robust
performance of 2011. Still, the core drivers of the business
remain strong - relevant brands and merchandise that command
attractive pricing and benefit from a loyal customer base. As
such, Fitch estimates that Limited Brands will continue to post
positive comparable store sales, in the low single digit range.
Operating margins and FCF levels are expected to be similar to
2011 levels. Fitch typically shows FCF after dividends. For the
last twelve months ended Oct. 29, 2011 this figure was negative
$626 million. However, FCF before dividends was $882 million for
the same period, the wide differential showing the large special
dividend outlays which are an outgrowth of the company's
shareholder-friendly stance. For 2012, Fitch anticipates a FCF
level before dividends to be in the $800 million area, similar to
the level for the last twelve months ended Oct. 29, 2011.
Liquidity is strong, as indicated by a cash balance of $498
million at Oct. 29, 2011 and an undrawn $1.0 billion revolving
credit facility. The company has a comfortable maturity profile,
staggered over many years. Fitch considers refinancing risk low
given Limited Brands' strong business profile, favorable operating
trends, and reasonable leverage.
Fitch currently rates Limited Brands as follows:
-- Long-term Issuer Default Rating (IDR) 'BB+';
-- Bank credit facility 'BBB-';
-- Senior guaranteed unsecured notes 'BB+';
-- Senior unsecured notes 'BB';
-- Short-term IDR 'B';
-- Commercial paper 'B'.
The Rating Outlook is Stable.
LOCAL TV: Moody's Assigns 'B1' Rating to Proposed $15-Mil. Notes
----------------------------------------------------------------
Moody's Investors Service assigned B1 ratings and LGD2 -- 25%
assessments to Local TV Finance, LLC's proposed $15 million 1st
lien senior secured revolver and proposed $170 million 1st lien
senior secured term loan B being issued to amend and extend the
company's existing 1st lien senior secured bank credit facilities.
Moody's also upgraded the company's Corporate Family Rating (CFR)
to B3 from Caa1, the Probability of Default Rating (PDR) to B3
from Caa1 and the $275 million 1st lien senior secured term loan B
due May 2013 to B1, LGD2 -- 25% from B2, LGD2 -- 26%. The upgrades
reflect the company's improved operating performance, extended
debt maturities, as well as management's commitment to further
reduce debt balances. Ratings on the Senior Unsecured Toggle Notes
due June 2015 were affirmed at Caa2 but point estimates were
updated. The rating outlook was changed to Stable from Positive.
Assignments:
Issuer: Local TV Finance, LLC
-- NEW $15 million 1st Lien Senior Secured Revolver due May
2015: Assigned B1, LGD2 -- 25%
-- NEW $170 million 1st Lien Senior Secured Term Loan B due May
2015: Assigned B1, LGD2 -- 25%
Upgrades:
Issuer: Local TV Finance, LLC
-- Corporate Family Rating: Upgraded to B3 from Caa1
-- Probability of Default Rating: Upgraded to B3 from Caa1
-- Existing 1st lien Senior Secured Term Loan B due May 2013
($226.6 million currently outstanding, reducing to $55.6
million post transaction): Upgraded to B1, LGD2 -- 25% from
B2, LGD2 -- 26%
Unchanged:
Issuer: Local TV Finance, LLC
-- Senior Unsecured Toggle Notes due June 2015 ($199.8 million
outstanding): Affirmed Caa2 with point estimates updated (to
LGD5 -- 80% from LGD5 -- 81%)
Outlook Actions:
Issuer: Local TV Finance, LLC
-- Outlook, Changed to Stable from Positive
To be withdrawn upon repayment at the close of the transaction:
Issuer: Local TV Finance, LLC
-- $30 Million 1st Lien Senior Secured Revolver due May 2013:
B2, LGD2 -- 26%
RATINGS RATIONALE
Local TV's B3 corporate family rating reflects high leverage with
a two-year average debt-to-EBITDA ratio of 6.6x estimated for
December 31, 2011 (including Moody's standard adjustments).
Meaningful improvement compared to the 9.1x two year average debt-
to-EBITDA ratio reported for March 31, 2011 (or 7.9x net debt-to-
EBITDA) is due to improved operating performance over the last two
years in addition to debt prepayments. As expected, Local TV grew
EBITDA for LTM September 30, 2011 to more than $60 million
meaningfully higher than EBITDA of $31 million reported in FY2009,
reflecting an improving economy and a gradual recovery in
advertising demand combined with management's focus on direct
local sales. In 3Q2011, the company prepaid $30 million of term
loan B outstandings and $31.2 million principal amount of senor
PIK notes. Although core, non-political revenues are expected to
grow an estimated 6%-7% in 2011, the absence of significant
political advertising in 4Q2011 will result in an approximate 7%
decrease in overall revenues for FY2011. Looking forward, Moody's
expects at least high single digit revenue growth in 2012 given
strong demand for political advertising. In addition, Local TV
will benefit from expected increases in retransmission revenues
and related cash flow in 2013 helping to offset the absence of
political revenues. Moody's believes the company needs to continue
reducing debt balances given expected revenue declines in non-
election years and vulnerability to economic cycles. Lack of
national or regional scale constrains ratings, although the
company benefits from a station portfolio with diverse network
affiliations and leading audience positions as well as negotiating
leverage due to its FoxCo and Tribune agreements. As a television
broadcaster, Local TV faces increased competition for advertising
dollars due to ongoing media fragmentation. Ratings are supported
by good EBITDA margins achieved through cost savings from its
operating agreement with FoxCo Acquisition Sub and its management
agreement with Tribune Company. Cash balances of a minimum $15
million over the rating horizon plus $15 million of availability
under its extended revolver facility provide adequate liquidity.
The stable outlook reflects Moody's view that Local TV will grow
core advertising revenues and apply excess cash to reduce debt
balances resulting in two year debt-to-EBITDA ratios remaining
below 6.90x (including Moody's standard adjustments). The outlook
also incorporates the company maintaining good liquidity and
generating mid-single digit free cash flow or better.
Ratings could be downgraded if the company is not able to grow
core revenues resulting in two-year debt-to-EBITDA ratios
(including Moody's standard adjustments) increasing above 7.0x.
Weakened liquidity, including negative free cash flow, or reduced
EBITDA cushion to the revolver's secured leverage ratio covenant,
could also lead to a downgrade. Ratings could be upgraded if
revenue growth and debt repayments result in trailing two-year
debt-to-EBITDA ratios remaining below 5.75x. Local TV would also
need to maintain good liquidity including expectations for high
single-digit free cash flow-to-debt ratios.
The principal methodology used in rating Local TV Finance, LLC was
the Global Broadcast Industry Methodology published in June 2008.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Formed in early 2007 through the acquisition of nine television
stations from the New York Times Company, Local TV Finance, LLC
(Local TV), owns ten television stations located in 8 mid-size
markets (DMAs 43 to 101) across the United States. Network
affiliations are diversified among 4 CBS stations, 2 ABC, 2 NBC, 1
CW and 1 MNTV station. Local TV's parent company is 95% owned by
affiliates of Oak Hill Capital Partners. The company maintains
headquarters in Fort Wright, Kentucky and revenue for the twelve
months ended September 30, 2011, totaled $178 million.
LONE STAR: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Lone Star Roofing, Inc.
P.O. Box 204002
Austin, TX 78720
Bankruptcy Case No.: 12-10199
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
Western District of Texas (Austin)
Judge: H. Christopher Mott
Debtor's Counsel: Barbara M. Barron, Esq.
Stephen W. Sather, Esq.
BARRON & NEWBURGER, P.C.
1212 Guadalupe, #104
Austin, TX 78701
Tel: (512) 476-9103 Ext. 220
Fax: (512) 476-9253
E-mail: bbarron@bnpclaw.com
ssather@bnpclaw.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/txwb12-10199.pdf
The petition was signed by Don Pearson, president.
LOS ANGELES DODGERS: Korean Retailer Part of Bidding Group
----------------------------------------------------------
Miyoung Kim, writing for Reuters, reports that Park Sung-su
Now, the 58-year-old founder and top shareholder of privately-
owned South Korean retailer E-Land Group, confirmed last week he
is part of a consortium shortlisted to buy the Los Angeles Dodgers
out of bankruptcy.
Reuters relates E-Land said it was taking a stake in a bidding
consortium for the Dodgers, with local media saying its around 15%
share was worth KRW150 billion to KRW200 billion ($133 million to
$177 million). But the company declined to comment on local media
reports it joined forces with former Dodgers owner Peter O'Malley
to bid for one of baseball's most storied franchises.
Reuters notes Mr. Park is a devoted follower of baseball and
collects Major League Baseball souvenirs. Reuters also relates
Mr. Park, who studied architecture at the prestigious Seoul
National University, opened his first E-Land clothing store in
Seoul in 1980 and the company has grown quickly, mainly through
debt-fuelled acquisitions. According to Reuters, the company has
added outlets, leisure holdings and upmarket brands such as
Mandarina Duck. It has set out to capture part of the U.S. teen
apparel market with its Who.A.U stores. It is also licensed to
sell the New Balance brand of sports shoes in South Korea.
Reuters notes one private equity investor familiar with E-Land,
but who did not want to be named as he was not authorized to talk
to the media, said the bid for the Dodgers as part of a consortium
makes sense as this would provide a bridgehead for its brand in
the United States.
As reported by the Troubled Company Reporter on Feb. 2, 2012, the
Dodgers' financial advisers have completed the first round of
bidding for the team. According to The Wall Street Journal's
Matthew Futterman, people familiar with the process said that
bankers at Blackstone Group had approved about 10 groups of
bidders who will be asked to participate in a second round of
offers. According to the WSJ report, the bidders who made the
second round include:
* hedge-fund manager Steven Cohen,
* a group led by cable investor Leo Hindery and New York
financier Marc Utay,
* one that includes former Los Angeles Laker Magic Johnson
and former baseball executive Stan Kasten, and
* another led by California developer Rick Caruso and
former Dodgers manager Joe Torre.
The Los Angeles Times reported that St. Louis Rams owner Stan
Kroenke made it to the second round of bidding.
The Associated Press says Magic Johnson's group includes Mark
Walter, chief executive officer of the Guggenheim Partners
financial services firm.
The AP relates Dodgers owner Frank McCourt's agreement with Major
League Baseball calls for him to forward up to 10 bidders to MLB
for background checks, which cost each group $25,000 to cover
baseball's costs.
According to the Journal, the Dodgers received multiple bids of
more than $1 billion, which would set a record for a baseball
franchise.
The sale is subject to Bankruptcy Court approval. The report
notes Major League Baseball plans to vet all bidders that will
continue to the second round.
The Dodgers are hoping to complete the sale by April 30. WSJ
noted that Mr. McCourt is divorcing his estranged wife, Jamie, and
must make a payment of $131 million to her by May 1.
About Los Angeles Dodgers
Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a
professional Major League Baseball club in the Los Angeles
metropolitan area. Frank McCourt, a Boston real-estate developer
who unsuccessfully bid for the Boston Red Sox, bought the Dodgers
from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for
$330 million. Mr. McCourt also bought the Dodgers Stadium from
Fox for $100 million.
Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr.
D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB
Commissioner Bud Selig rejected a television deal with News
Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for
June 30 and July 1. Fox Sports has exclusive cable television
rights for Dodgers games until the end of 2013 baseball season.
Chapter 11 filings were also made for LA Real Estate LLC, an
affiliated entity which owns Dodger Stadium, and three other
related holding companies.
The petition estimates assets of up to $500 million and debts of
up to $1 billion. In its schedules, the LA Dodgers baseball club
disclosed $77,963,734 in assets and $4,695,702 in liabilities. LA
Real Estate LLC disclosed $161,761,883 in assets and $0 in
liabilities.
According to Forbes, the team is worth about $800 million, making
it the third most valuable baseball team after the New York
Yankees and the Boston Red Sox.
Judge Kevin Gross presides over the case. Lawyers at Young,
Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the
Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the
claims and notice agent. Public relations specialist Kekst and
Company has been hired for crisis support. Covington & Burling
LLP serves as special counsel.
An official committee of unsecured creditors has been appointed in
the case. The panel has tapped Lazard Freres & Co. as financial
adviser and investment banker, and Morrison & Foerster LLP and
Pinckney, Harris & Weidinger, LLC as counsel.
The LA Dodgers is the 12th sports team in North America to have
sought bankruptcy protection.
The reorganization is being financed with a $150 million unsecured
loan from the Commissioner of Major League Baseball. The loan
gives the Commissioner few of the controls lenders often demanded
from bankrupt companies.
M WAIKIKI: Gets OK to Obtain $550,000 from Davidson Family Trust
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Hawaii, authorized
M Waikiki, LLC to amend the loan and security agreement dated as
of Sept. 26, 2011, pursuant to which the Debtor will obtain
additional secured, second priority, postpetition financing in an
aggregate amount of up to $550,000 from Davidson Family Trust.
As reported in the Troubled Company Reporter on Jan. 13, 2012,
shortly after the commencement of its Chapter 11 case, the Debtor
was granted authority to borrow up to $2.5 million in debtor-in-
possession financing to fund the Debtor's postpetition operations
and other administrative expenses. At that time, the Debtor and
its DIP lender has relatively limited information with which to
estimate the amount of financing the Debtor would need to fund its
reorganization.
As of the Petition Date, the Debtor owed senior secured debt of
approximately $114.9 million and subordinated secured debt of
approximately $18.2 million. The Debtor currently owes the DIP
lender approximately $2.5 million in principal plus accrued
interest under the terms of the DIP credit agreement.
The terms of the additional loan will be the same as originally
provided in the DIP Credit agreement.
The Official Committee of Unsecured Creditors in the Debtor's case
has filed a limited objection to the Debtor's motion to amend the
credit agreement.
The Committee requested that the Court approve the motion, on an
interim basis, exercise the new default provision, and grant
further relief as the Court deems just.
If approved, a total $9 million of superpriority DIP financing
would have to be paid on the effective date of any Plan or
April 30, 2012.
About M Waikiki
M Waikiki owns the Modern Honolulu, a world-class, luxury hotel
property located close to Waikiki Beach in Hawaii. The hotel is
being managed by Modern Management Services LLC, an affiliate of
Aqua Hotels and Resorts.
M Waikiki is a Hawaii limited liability company with its principal
place of business located in San Diego, California. It is a
special purpose entity, having roughly 75 indirect investors,
which was formed to acquire the Hotel.
The Company filed for Chapter 11 protection (Bankr. D. Hawaii Case
No. 11-02371) on Aug. 31, 2011. Judge Robert J. Faris presides
over the case. Patrick J. Neligan, Esq., and James P. Muenker,
Esq., at Neligan Foley LLP, in Dallas, Tex.; Simon Klevansky,
Esq., Alika L. Piper, Esq., and Nicole D. Stucki, Esq., at
Klevansky Piper, LLP, in Honolulu, Hawaii, are the attorneys to
the Debtor. The Debtor tapped XRoads Solutions Group, LLC, and
Xroads Case Management Services, LLC, as its financial and
restructuring advisor. The Debtor disclosed $216,116,142 in
assets and $135,085,843 in liabilities as of the Chapter 11
filing.
Modern Management is represented by Christopher J. Muzzi, Esq.,
at Moseley Biehl Tsugawa Lau & Muzzi LLC.
Marriott Hotel Services, which used to provide management
services, is represented by Susan Tius, Esq., at Rush Moore LLP
LLP, and Carren B. Shulman, Esq., at Sheppard Mullin Richter &
Hampton LLP.
MARK TIPTON: ECU Trustee Files for Chapter 11 Bankruptcy
--------------------------------------------------------
Reflector.com reports that East Carolina University Trustee Mark
Tipton filed a Chapter 11 petition in U.S. Bankruptcy Court for
the Eastern District of North Carolina on Jan. 30, 2012.
According to the report, the petition listed $66 million in
liabilities, including amounts disputed by Mr. Tipton, mostly from
Whistler Investment Group LLC and other corporate entities that
Mr. Tipton controlled.
The report notes that trustees are appointed by the University of
North Carolina system's Board of Governors. Missing three
consecutive trustees meetings is the only reason a member can lose
a seat on the board.
Mark Tipton is a 1973 graduate of ECU and received an Outstanding
Alumni Award in 1994.
MARSICO HOLDINGS: Bank Debt Trades at 62% Off in Secondary Market
-----------------------------------------------------------------
Participations in a syndicated loan under which Marsico is a
borrower traded in the secondary market at 37.90 cents-on-the-
dollar during the week ended Friday, Feb. 3, 2012, an increase of
4.03 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. The bank loan matures on Dec. 14, 2014. The
loan is one of the biggest gainers and losers among 168 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
Marsico Holdings, LLC, is the new indirect parent of Marsico
Capital Management, LLC, and Marsico Fund Advisors, LLC. Marsico
Capital Management is a Denver-based asset management firm
offering investment services to institutional and retail
investors.
The last rating action was taken on Oct. 13, 2010, when Moody's
downgraded the ratings of Marsico Parent Company, LLC's senior
secured bank facilities to Caa2 from Caa1and put them on review
for further downgrade. In addition, the rating of Marsico Parent
Holdco, LLC's senior note was downgraded to C from Ca with a
stable outlook. In the same rating action, Moody's also put the
Caa3 corporate family rating of Marsico Parent on review for
possible downgrade. Moody's affirmed Marsico Parent's senior
unsecured notes at Ca and changed the outlook to stable from
negative.
MEECHAM HOSPITALITY: Fossil Creek Hotel in Chapter 11
-----------------------------------------------------
Meecham Hospitality LLC, the owner of a Holiday Inn hotel
north of Fort Worth, Texas, near Interstate 35 West, filed for
Chapter 11 protection (Bankr. N.D. Tex. Case No. 12-40594) in Fort
Worth. The hotel is known as the Fort Worth North-Fossil Creek.
The property is worth $8.85 million while debt totals $14.8
million, almost all secured, according to the petition. The
mortgages as held by City Bank Texas in Grand Prairie, Texas.
MONEY TREE: Court Approves Barker Donelson as Chapter 11 Counsel
----------------------------------------------------------------
The Money Tree Inc. and its debtor-affiliates sought and obtained
permission from the Bankruptcy Court to employ Baker Donelson
Bearman Caldwell & Berkowitz, PC as chapter 11 counsel.
Max A. Moseley, Esq., attorney at Baker Donelson Bearman Caldwell
& Berkowitz, attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
The firm's rates are:
Personnel Rates
--------- -----
Shareholders $360 to $425
Of Counsel $360 to $425
Associates $175 to $295
Legal assistants $140 to $195
About Money Tree
Bainbridge, Georgia-based The Money Tree Inc. --
http://www.moneytreeinc.com/-- operates a network of lending
branches across the Southeast, concentrated in Georgia, Florida
and Alabama. The Company and four affiliates filed for Chapter 11
bankruptcy (Bankr. M.D. Ala. Case Nos. 11-12254 thru 11-12258) on
Dec. 16, 2011. The other debtor-affiliates are Small Loans, Inc.,
The Money Tree of Louisiana, Inc., The Money Tree of Florida Inc.,
and The Money Tree of Georgia of Georgia Inc. Judge William R.
Sawyer oversees the case, replacing Judge Dwight H. Williams, Jr.
Max A. Moseley, Esq., at Baker Donelson Bearman Caldwell & Berkow,
P.C., serves as the Debtors' counsel. The Debtors hired Warren,
Averett, Kimbrough & Marino, LLC, as restructuring advisors.
Money Tree's consolidated balance sheet reported $34,859,189 in
assets, $92,655,010 in liabilities, and $57,795,821 in total
stockholders' deficit. The petitions were signed by Biladley D.
Bellville, president.
The Company's subsidiary, Best Buy Autos of Bainbridge Inc., is
not a party to the bankruptcy filing and intends to operate its
business in the ordinary course.
MONEYGRAM INT'L: Posts $3.1 Million Net Income in Fourth Quarter
----------------------------------------------------------------
MoneyGram International, Inc., reported net income of $3.12
million on $321.84 of total revenue for the three months ended
Dec. 31, 2011, compared with net income of $16.15 million on
$303.36 million of total revenue for the same period a year ago.
The Company reported net income of $59.40 million on $1.24 billion
of total revenue for the twelve months ended Dec. 31, 2011,
compared with net income of $43.80 million on $1.16 billion of
total revenue during the prior year.
The Company's balance sheet at Dec. 31, 2011, showed $5.17 billion
in total assets, $5.28 billion in total liabilities and a $110.19
million total stockholders' deficit.
"We are very pleased with our accomplishments in 2011. For the
year we achieved double-digit growth in money transfer transaction
volume, constant currency revenue, and agent locations. Our
impressive performance was achieved while we recapitalized our
preferred shares, nearly doubled our public float, and reduced our
second lien debt by $175 million," said Pamela H. Patsley,
chairman and chief executive officer. "We are optimistic about
2012 and while we are mindful of the economic challenges in
Europe, our business is geographically diverse. We have great
momentum in our money transfer business and continue to leverage
the core as we expand into online, account-based, mobile and self-
service offerings. We will utilize our strong cash flow to invest
in the business and maximize shareholder value."
A full-text copy of the press release is available for free at:
http://is.gd/C6miOy
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 as of June 30, 2010, showed
$5.461 billion in total assets, $5.450 billion in total
liabilities, $929.2 million in total mezzanine equity, and a
stockholders' deficit of $918.0 million.
* * *
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: May Face Criminal Penalties for Alleged Fraud
--------------------------------------------------------------
MoneyGram International, Inc., has been served with subpoenas to
produce documents and testify before a grand jury in the U.S.
District Court for the Middle District of Pennsylvania. The
subpoenas sought information related to, inter alia, MoneyGram's
U.S. and Canadian agents, as well as certain transactions
involving those agents, fraud complaint data, and MoneyGram's
consumer anti-fraud program during the period from 2004 to 2009.
MoneyGram has provided information requested pursuant to the
subpoenas and continues to provide additional information relating
to the investigation. In addition, the Company has been provided
with subpoenas for the testimony of certain current and former
employees in connection with the investigation. The Company has
also been notified of a request for interviews of one current
executive officer and one former chief executive officer of the
Company.
The U.S. Department of Treasury Financial Crimes Enforcement
Network requested information, which information was subsequently
provided by MoneyGram, concerning MoneyGram's reporting of
fraudulent transactions during this period. In November 2010,
MoneyGram met with representatives from the U.S. Attorney's Office
for the Middle District of Pennsylvania and representatives of
FinCEN to discuss the investigation. In July 2011, MoneyGram had
further discussions with the MDPA USAO and representatives of the
Asset Forfeiture and Money Laundering Section of the U.S.
Department of Justice. MoneyGram has been informed that it is
being investigated by the federal grand jury in connection with
these matters for the period 2004 to early 2009 as well as
MoneyGram's anti-money laundering program during that period.
In January 2012, meetings were held between representatives of the
Company, the MDPA USAO and the Criminal Division of the US DOJ to
discuss the investigation. MoneyGram continues to engage in
discussions and cooperate with those government representatives
regarding the ongoing investigation. During the course of these
discussions, the Company was advised that consideration is being
given to a range of possible outcomes, including the seeking of
criminal penalties against the Company. However, no conclusions
can be drawn at this time as to the outcome of the investigation.
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, 2011, showed $5.17 billion
in total assets, $5.28 billion in total liabilities and a $110.19
million total 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.
MORGAN & FINNEGAN: Judge Allow Clawback Suit Against Ex-Attys
-------------------------------------------------------------
Hilary Russ at Bankruptcy Law360 reports that that claims in a
lawsuit seeking to claw back money from former partners of the
Morgan & Finnegan LLP will go forward after a New York bankruptcy
judge on Thursday rejected most of the partners' coordinated
motion to dismiss the case.
Law360 relates that U.S. Bankruptcy Judge Robert Drain allowed M&F
trustee Roy Babitt to keep pursuing fraudulent transfer claims
against the small group of five ex-partners, who received
distributions as the law firm, which dissolved in January 2009,
was going under.
About Morgan & Finnegan
Morgan & Finnegan LLP was a New York Law firm. Locke Lord Bissell
& Liddell hired 30 of the Morgan & Finnegan's lawyers, including
13 out of 17 remaining partners, in February 2009.
Morgan & Finnegan in March 2009 filed for Chapter 7 bankruptcy.
The Company disclosed $6.37 million in assets and $10 million in
debts, and also listed "multiple former partners" as unsecured
creditors owed capital totaling $3.9 million.
MORRIER RANCH: Banks Sue for $6 Million in Unpaid Debts
-------------------------------------------------------
Mai Hoang at Yakima Herald-Republic reports that Morrier Ranch has
been sued by two banks for nearly $6 million in unpaid debt,
forcing the company into a reorganization bankruptcy.
According to the report, Morrier Ranch's $19.7 million in assets
include ownership of several properties in East Valley, including
hop fields in Moxee and residential property in Terrace Heights,
Washington. The report says the Company's revenues have declined.
In 2011, the corporation earned $767,790 in revenue from the sales
of hops, apples and storage, a nearly 24 percent decline from
2009.
The report, citing court documents, says the Company has debt
topping $6 million. The majority of the debt -- about $4.8
million -- is owed to KeyBank, which is seeking more than $3.7
million for two loans taken out against Morrier Ranch property,
and Banner Bank, which is seeking nearly $1.1 million for an
agricultural loan.
The report says Morrier Ranch denied allegations by both banks,
but a judge ultimately ruled in favor of KeyBank last month. A
judgment has not yet been reached in the Banner Bank case.
Yakima, Washington-based Morrier Ranch, Inc., aka Morrier Hop
Storage, filed for Chapter 11 bankruptcy (Bankr. E.D. Wash. Case
No. 12-00179) on Jan. 17, 2012. Judge Patricia C. Williams
presides over the case, taking the assignment from Judge Frank L.
Kurtz. James P. Hurley, Esq., at Hurley & Lara, serves as the
Debtor's counsel. In its petition, the Debtor estimated $10
million to $50 million in assets, and $1 million to $10 million in
debts. The petition was signed by Joseph R. Morrier, president.
MORTGAGE FUND '08: Court Confirms Chapter 11 Plan
-------------------------------------------------
Bankruptcy Judge Roger L. Efremsky confirmed the Joint Combined
Chapter 11 Plan and Disclosure Statement dated Dec. 21, 2011,
filed by Mortgage Fund '08 LLC and the Official Committee of
Unsecured Creditors, pursuant to a Feb. 3, 2012 FINDINGS OF FACT
AND CONCLUSIONS OF LAW IN SUPPORT OF JOINT COMBINED CHAPTER 11
PLAN AND DISCLOSURE STATEMENT available at http://is.gd/AEdM1I
from Leagle.com.
On Dec. 22, 2011, the Court entered its Order Conditionally
Approving Disclosure Statement, Setting Plan Confirmation Hearing
and Setting Deadlines, granting conditional approval of the
Disclosure Statement pursuant to Bankruptcy Code Sec. 1125(f)(3).
Creditors Eugene Rapp, the Eugene A. Rapp Revocable Trust, and
North American Financial, Inc., objected to the Disclosure
Statement's estimate of the number of creditors likely to make a
Convenience Class election, and to the procedures for asset sales
and trustee compensation provided for under a Liquidating Trust
Agreement. Of the two classes entitled to vote on the Plan
(Classes 2 and 3), both voted to accept the Plan.
An involuntary Chapter 7 petition was filed against Mortgage Fund
'08 LLC (Bankr. N.D. Calif. Case No. 11-_____) on Sept. 12, 2011.
The case was converted to chapter 11 on Sept. 28, 2011, pursuant
to a stipulation between the Debtor and the petitioning creditors.
Cecily A. Dumas, Esq. -- cdumas@friedumspring.com -- at Friedman
Dumas & Springwater LLP appeared on behalf of the Debtor. Iain A.
MacDonald, Esq., at MacDonald & Associates appeared on behalf of
the Committee.
NEWBURGH CITY: Moody's Affirms 'Ba1' General Obligations Rating
---------------------------------------------------------------
Moody's Investors Service has affirmed the City of Newburgh's (NY)
Ba1 general obligation rating. The Ba1 rating affects $25.3
million of outstanding long-term debt.
SUMMARY RATING RATIONALE
The Ba1 rating reflects the city's severely strained financial
position, a continued reliance on short-term borrowing, and
extraordinary measures, including issuance of deficit financing,
to fund operations, as well as its stagnant tax base and weak
socioeconomic characteristics.
Effective January 1, 2012, all local governments in New York State
are subject to a property tax cap which limits levy increases to
2% or the rate of inflation, whichever is lower. While school
district debt has been exempted from the cap, debt has not been
exempted for all other local governments. Moody's will continue to
treat school district general obligation debt issued in New York
as an unlimited tax pledge and continue to research the impact of
the property tax cap on debt issued by nonschool districts. For
more information regarding the property tax cap please reference
the Special Comment "New York State's Property Tax Cap will
Further Pressure Local Government Finances; School District's Most
Impacted" released July 5, 2011.
STRENGTHS
Property taxes set aside monthly into a state held bank account
for the payment of debt service
State oversight of city financial operations
Strong actions taken to restore budgetary balance
CHALLENGES
Tax base erosion and weak socioeconomic profile
Significant operating debt
Negative General Fund balance
Projections show deficit operations going forward
WHAT COULD MAKE THIS RATING GO UP
--Demonstrated balance in fiscal 2011
--Demonstrated favorable coverage of debt service by the Special
Debt Service Fund
--Economic expansion
WHAT COULD MAKE THIS RATING GO DOWN
--Inability to sustain budgetary balance
The principal methodology used in this rating was General
Obligation Bonds Issued by U.S. Local Governments published in
October 2009.
NEWPAGE CORP: Ciardi Ciardi OK'd to Handle Panel's Experts Hiring
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
NewPage Corporation to employ Ciardi Ciardi & Astin as special
counsel.
As reported in the Troubled Company Reporter on Nov. 30, 2011,
Ciardi Ciardi will represent the Debtors in connection with issues
relating to the official committee of unsecured creditors'
proposed employment of financial professionals. The Debtors have
selected Ciardi as their special counsel because of the firm's
experience and knowledge in business restructurings under Chapter
11 of the Bankruptcy Code and, more specifically, professional
employment and compensation issues arising in those bankruptcy
cases.
The current hourly rates of Ciardi professionals are $250 to $560
for attorneys and $95 to $180 for paraprofessionals.
The Debtors agreed to reimburse Ciardi for its expenses incurred
including, among other things, photocopying services, printing,
delivery charges and filing fees.
The Debtors attested that Ciardi is a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code, a
modified by Section 1107(b).
About NewPage Corp.
Headquartered in Miamisburg, Ohio, NewPage Corporation was the
leading producer of printing and specialty papers in North
America, based on production capacity, with $3.6 billion in net
sales for the year ended Dec. 31, 2010. The company's product
portfolio is the broadest in North America and includes coated
freesheet, coated groundwood, supercalendered, newsprint and
specialty papers. These papers are used for corporate collateral,
commercial printing, magazines, catalogs, books, coupons, inserts,
newspapers, packaging applications and direct mail advertising.
NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan,
Minnesota, Wisconsin and Nova Scotia, Canada. These mills have a
total annual production capacity of roughly 4.1 million tons of
paper, including roughly 2.9 million tons of coated paper, roughly
1.0 million tons of uncoated paper and roughly 200,000 tons of
specialty paper.
NewPage, along with affiliates, filed Chapter 11 bankruptcy
protection (Bankr. D. Del. Lead Case No. 11-12804) on Sept. 7,
2011. Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and
Philip M. Abelson, Esq., Dewey & Leboeuf LLP, in New York, serve
as counsel. Laura Davis Jones, Esq., at Pachulski Stang Ziehl &
Jones LLP, in Wilmington, Delaware, serves as co-counsel. Lazard
Freres & Co. LLC is the investment banker, and FTI Consulting Inc.
is the financial advisor. Kurtzman Carson Consultants LLC is the
claims and notice agent. In its balance sheet, the Debtors
disclosed $3.4 billion in assets and $4.2 billion in total
liabilities as of June 30, 2011. As reported in the Troubled
Company Reporter on Jan. 23, 2012, the Debtor disclosed
$1.9 billion in assets and $3.7 billion in liabilities.
At an organizational meeting of creditors held on Sept. 21, 2011,
the Committee selected Paul Hastings LLP as its bankruptcy
counsel and Young Conaway Stargatt & Taylor, LLP to act as its
Delaware and conflicts counsel.
NewPage prevailed over most objections from the official
creditors' committee and won agreement from the bankruptcy judge
on final approval of $600 million in secured financing.
Moody's Investors Service assigned a Ba2 rating to the
$350 million first-out revolving debtor-in-possession credit
facility and a B2 rating to the $250 million second-out debtor-in-
possession term loan for NewPage.
NEXT 1 INTERACTIVE: Amends P-Notes with Don Monaco Affiliates
-------------------------------------------------------------
Next 1 Interactive, Inc., and entities affiliated with Don Monaco,
a director of the Company, entered into amendments with respect to
$250,000, $250,000, $300,000 and $200,000 aggregate principal
amount of secured convertible promissory notes pursuant to which
those Notes were amended so that each Note is convertible into
shares of the Company's Series A 10% Cumulative Convertible
Preferred Stock on a one for one basis. Prior to the amendments,
each Note was convertible into shares of the Company's common
stock based on a conversion price equal to 90% of the average
closing price of the common stock during the ten trading days
prior to conversion, with a minimum conversion price of $0.05 per
share.
About Next 1 Interactive
Weston, Fla.-based Next 1 Interactive, Inc., is an interactive
media company that focuses on video and media advertising over
Internet, Mobile and Television platforms. Historically, the
Company operated through two divisions, media and travel. A third
(real estate) division is anticipated to be launching during the
fourth quarter of fiscal 2012.
For the nine months ended Nov. 30, 2011, the Company has reported
a net loss of $8.0 million on $1.1 million of revenues, compared
with a net loss of $10.2 million on $1.9 million of revenues for
the nine months ended Nov. 30, 2010.
The Company's balance sheet at Nov. 30, 2011, showed $3.0 million
in total assets, $13.0 million in current liabilities, and a
stockholders' deficit of $10.0 million.
As reported in the TCR on June 22, 2011, Sherb & Co., LLP, in Boca
Raton, Fla., expressed substantial doubt about Next 1
Interactive's ability to continue as a going concern, following
the Company's results for the fiscal year ended Feb. 28, 2011.
The independent auditors noted that the Company had an accumulated
deficit of $53.2 million and a working capital deficit of
$13.4 million at Feb. 28, 2011, net losses for the year ended
Feb. 28, 2011, of $23.2 million and cash used in operations during
the year ended Feb. 28, 2011, of $9.6 million.
NORTEL NETWORKS: Wants to Facilitate Wind-Down of NN Japan
----------------------------------------------------------
Nortel Networks Inc., et al., ask the U.S. States Bankruptcy Court
for the District of Delaware to authorize:
a) NNI to take all necessary actions to facilitate the wind-
down of Nortel Networks Kabushiki Kaisha (NN Japan), including,
without limitation, the repatriation of funds from NN Japan to
NNI;
b) NNI to take all necessary actions to remove NN Japan as a
party to (i) that certain MEN Distribution Escrow Agreement
dated March 19, 2009; (ii) that certain Enterprise Distribution
Escrow Agreement dated Dec. 18, 2009; (iii) that certain CVAS
Distribution Escrow Agreement dated May 27, 2010, and (iv) that
certain MSS Distribution Escrow Agreement dated March 11, 2011;
c) the assignment to NNI of remaining rights and obligations of
NN Japan, if any, under the Escrow Agreements;
d) NNI to enter into an indemnification agreement to indemnify
and hold harmless NN Japan and its directors in connection with
the Cash Repatriation.
NN Japan is a wholly-owned subsidiary of NNI incorporated under
the laws of Japan. Historically, NN Japan engaged in the sale and
marketing of Nortel telecommunications equipment in Japan;
however, it has ceased all active operations and is in the process
of preparing a voluntary solvent liquidation of its assets. After
accounting for all of its liabilities, obligations, and
liquidation costs, NN Japan anticipates that it will have a
significant surplus cash balance, which it is willing to
repatriate to NNI.
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 (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009.
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. 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.
Nortel has raised $3.2 billion by selling its operations as it
prepares to wind up a two-year liquidation due to insolvency. In
June 2011, Nortel added US$4.5 billion to its cash pile after
agreeing to sell its remaining patent portfolio to Rockstar Bidco,
a consortium consisting of Apple Inc., EMC Corporation,
Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In
Motion Limited, and Sony Corporation. The consortium defeated a
$900 million stalking horse bid by Google Inc. at an auction. The
deal closed in July 2011.
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.
The Office of the United States Trustee for the District of
Delaware has appointed an Official Committee of Unsecured
Creditors in respect of the Debtors, and an ad hoc group of
bondholders has been organized.
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.
The Official Committee of Retired
Employees and the Official Committee of Long-Term Disability
Participants tapped Alvarez & Marsal Healthcare Industry Group
as financial advisor. The Retiree Committee is represented by
McCarter & English LLP as Delaware counsel, and Togut Segal &
Segal serves as the Retiree Committee.
NORTH FOREST: Moody's Affirms 'Ba3' Gen. Obligation Debt Rating
---------------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 rating on North
Forest ISD's (TX) $56.5 million general obligation debt. Moody's
has placed the rating on watchlist, direction uncertain.
SUMMARY RATIONAL
The Ba3 rating reflects the district's history of financial
mismanagement demonstrated by the district's failure to address
staffing levels despite steep and ongoing enrollment decline;
misreporting of district enrollment resulting in a large liability
to the state; and the use of bond funds for operating expenses.
Financial mismanagement has resulted in deficit fund balances and
narrow cash positions. As a result of financial mismanagement and
educational deficiencies, the Texas Education Agency has moved to
dissolve the district and merge the district with neighboring
Houston ISD (Aaa). In the event this occurs, NFISD's debt will
become the obligation of Aaa rated HISD. The watchlist (direction
uncertain ) action reflects the uncertainty surrounding the
district's plan to appeal TEA's actions. In addition, TEA's
authority to close the district must be cleared by the Department
of Justice. This DOJ has yet to clear the dissolution and NFISD
has not completed their appeal process.
WHAT COULD CHANGE THE RATING -- UP:
Annexation of NFISD into HISD
WHAT COULD CHANGE THE RATING -- DOWN (OR REMOVAL OF WATCHLIST):
Appeals process that results in the reversal of TEA's decision to
merge the district with a higher rated credit
PRINCIPAL RATING METHODOLOGY
The principal methodology used in this rating was General
Obligation Bonds Issued by U.S. Local Governments published in
October 2009.
OCEAN PLACE: U.S. Trustee Wants Plan Confirmation Denied
--------------------------------------------------------
Roberta A. Deangelis, the U.S. Trustee for Region 3, has asked the
U.S. Bankruptcy Court for the District of New Jersey to deny the
confirmation of the Second Amended Plan of Liquidation proposed by
creditor AFP 104 Corp. for Ocean Place Development, LLC.
According to the U.S. Trustee, the Plan is not confirmable because
it contains overboard third party release, injunction and
exculpation clauses, which are contrary to applicable law in the
Third Circuit.
AFP filed the Plan on Dec. 1, 2011, which provided that assets of
the Debtor will be sold at an auction conducted after the
confirmation date. If AFP is the successful bidder, it will
contribute a cash payment of $600,000 and any proceeds in excess
of its secured claim will be transferred to a Liquidating Trustee.
If AFP is not the successful purchaser at the sale, it will
receive cash on the Effective Date in the amount of the AFP
Secured Claim, and therefore AFP will not be making the $600,000
financial contribution to the estate.
United States Trustee requested that confirmation of the Plan not
be approved as drafted.
About Ocean Place Development
Ocean Place Development, LLC, owns a beachfront resort property in
Long Branch, New Jersey. The Ocean Place resort is sited on 17-
acres featuring 1,000 feet of ocean frontage and is improved with
a 254-room hotel that includes 40,000 square feet of meeting
space, three restaurants, a bar/lounge, a full-service spa, and
numerous resort amenities. It employs between 95 and 340
employees, depending upon the season, through the property
management entity West Paces Hotel Group, LLC.
Ocean Place filed a voluntary Chapter 11 petition (Bankr. D. N.J.
Case No. 11-14295) on Feb. 15, 2011. Kenneth Rosen, Esq., John K.
Sherwood, Esq., and Wojciech F. Jung, Esq., at Lowenstein Sandler,
in Roseland, N.J., serves as the Debtor's bankruptcy counsel. The
Debtor estimated its assets and debts at $50 million to
$100 million.
As of the petition date, the Debtor owed $57,245,372 to AFP 104
Corp. pursuant to a Loan Agreement dated April 25, 2006, as
amended from time to time, entered into by and between the Debtor
as borrower and Barclays Capital Real Estate Inc. as lender.
Joseph L. Schwartz, Esq., and Kevin J. Larner, Esq., at Riker,
Danzig, Scherer, Hyland & Perretti LLP, in Morristown, New Jersey,
represents AFP 104 as counsel.
OPEN RANGE: Hoping to Sue Federal Government Agencies
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Open Range Communications Inc. was unable to sell the
business as a going concern and was thereby forced to halt
operations and sell the assets piecemeal at auction. The Debtor
says the attention of the company and creditors has turned toward
laying the basis for lawsuits against an affiliated lender, the
Federal Communications Commission, and the U.S. Agriculture
Department.
The disclosures, according to the report, were included in a
motion seeking a two-month enlargement of the exclusive right to
propose a Chapter 11 plan. The hearing on the so-called
exclusivity motion is set for Feb. 16. If granted, exclusivity
will be pushed out to April 3.
About Open Range
Greenwood Village, Colo.-based Open Range Communications Inc., a
provider of wireless broadband services to 26,000 rural customers
in 12 states, filed a Chapter 11 petition (Bankr. D. Del. Case No.
11-13188) on Oct. 6, 2011, to either sell the business or shut
down and liquidate. Open Range disclosed about $115.1 million in
assets and $102.8 million in debts. Open Range started its WiMax
broadband and voice service in late 2009, backed by a $267 million
loan from the U.S. Department of Agriculture's Rural Utility
Service and $100 million invested by One Equity Partners, a
financing arm of JPMorgan Chase & Co.
Judge Kevin J. Carey presides over the case. Marion M. Quirk,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, serves as
bankruptcy counsel. Logan & Co. serves as claims agent. FTI
Consulting, Inc., will provide a chief restructuring officer,
Michael E. Katzenstein; an associate chief restructuring officer,
Chris Lewand; and hourly temporary staff. The petition was signed
by Chris Edwards, chief financial officer.
On filing for Chapter 11 protection, Open Range said it would shut
down and liquidate the network if a buyer couldn't be found.
Roberta A. DeAngelis, the United States Trustee for Region 3,
pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Open Range Communications Inc.
In December 2011, Ann Schrader at the Denver Post reported that
Open Range shut down operations after failing to get the broadcast
spectrum it needed, problems with network quality and vendors, and
the "sporadic" flow of money from a $267 million federal loan, of
which Open Range owes a balance of $73.5 million.
Open Range hired RB Capital LLC and Heritage Global Partners Inc.
as auctioneers and sales agents to conduct an auction of the
Debtor's assets.
OPEN RANGE: Anton Collins OK'd to Assist in 2011, 2012 Tax Returns
------------------------------------------------------------------
The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware authorized Open Range Communications Inc. to
employ Anton Collins Mitchell LLP as its tax advisor.
As reported in the Troubled Company Reporter on Jan. 24, 2012,
ACM LLP will assist the Debtor in preparing and filing state and
local tax returns for the 2011 and 2012 tax years and will provide
an audit of the Open Range Communications Inc. 401(k) Profit
Sharing & Trust.
ACM LLP's hourly rates for the preparation of property tax returns
will be:
Partner $350
Director $245
Manager $220
Senior $155
Staff $115
The hourly rates charged by ACM LLP professionals in the audit
group are:
Partner $300 - $350
Director $275 - $300
Manager $180 - $250
Senior $125 - $180
Staff $100 - $125
The Debtor is also authorized to pay ACM LLP a retainer of $15,000
for the audit services, and reimbursement of expenses.
The Debtor believes that ACM LLP is a "disinterested person" as
that term in defined in Section 101(14) of the Bankruptcy Code.
About Open Range
Greenwood Village, Colo.-based Open Range Communications Inc., a
provider of wireless broadband services to 26,000 rural customers
in 12 states, filed a Chapter 11 petition (Bankr. D. Del. Case No.
11-13188) on Oct. 6, 2011, to either sell the business or shut
down and liquidate. Open Range disclosed about $115.1 million in
assets and $102.8 million in debts. Open Range started its WiMax
broadband and voice service in late 2009, backed by a $267 million
loan from the U.S. Department of Agriculture's Rural Utility
Service and $100 million invested by One Equity Partners, a
financing arm of JPMorgan Chase & Co.
Judge Kevin J. Carey presides over the case. Marion M. Quirk,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, serves as
bankruptcy counsel. Logan & Co. serves as claims agent. FTI
Consulting, Inc., will provide a chief restructuring officer,
Michael E. Katzenstein; an associate chief restructuring officer,
Chris Lewand; and hourly temporary staff. The petition was signed
by Chris Edwards, chief financial officer.
On filing for Chapter 11 protection, Open Range said it would shut
down and liquidate the network if a buyer couldn't be found.
Roberta A. DeAngelis, the United States Trustee for Region 3,
pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Open Range Communications Inc.
In December 2011, Ann Schrader at the Denver Post reported that
Open Range has shut down operations after failing to get the
broadcast spectrum it needed, problems with network quality and
vendors, and the "sporadic" flow of money from a $267 million
federal loan, of which Open Range owes a balance of $73.5 million.
Open Range hired RB Capital LLC and Heritage Global Partners Inc.
as auctioneers and sales agents to conduct an auction of the
Debtor's assets.
OSCEOLA MEDICAL: May Be Dismissed on 'Bad Faith' Filing
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that four days after Osceola Medical Center LLC filed for
Chapter 11 protection to stave off foreclosure, secured lender
Fifth Third Bank filed papers asking for dismissal as a "bad faith
filing."
Osceola Medical Center owns of a 90,000-square-foot medical office
building in Celebration, Florida. The building is 30 percent
occupied and has been under foreclosure since April 2010. Osceola
filed a Chapter 11 bankruptcy petition (Bankr. M.D. Fla. Case No.
12-01062) on Jan. 27, 2012, just hours before a scheduled
foreclosure sale that was pursued by a bank owed $15.6 million on
a mortgage. R. Scott Shuker, Esq., at Latham Shuker Eden &
Beaudine LLP, in Orlando, Florida, serves as counsel. The Debtor
estimated assets of $1 million to $10 million as of the Chapter 11
filing and $10 million to $50 million in debts.
OVERLAND STORAGE: Pinnacle Family Discloses 7.9% Equity Stake
-------------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Pinnacle Family Office Investments, L.P., and
Barry M. Kitt disclosed that, as of Dec. 31, 2011, they
beneficially own 1,864,750 shares of common stock of Overland
Storage, Inc., representing 7.9% of the shares outstanding. As
previously reported by the TCR on Dec. 6, 2011, Pinnacle Family
disclosed beneficial ownership of 1,489,164 shares. A full-text
copy of the amended filing is available at http://is.gd/NREbf8
About Overland Storage
San Diego, Calif.-based Overland Storage, Inc. (Nasdaq: OVRL) --
http://www.overlandstorage.com/-- is a global provider of unified
data management and data protection solutions designed to enable
small and medium enterprises (SMEs), corporate departments and
small and medium businesses (SMBs) to anticipate and respond to
change.
The Company reported a net loss of $14.50 million on $70.19
million of net revenue for the fiscal year ended June 30, 2011,
compared with a net loss of $12.96 million on $77.66 million of
net revenue during the prior fiscal year.
Moss Adams LLP, in San Diego, California, noted that the Company's
recurring losses and negative operating cash flows raise
substantial doubt about the Company's ability to continue as a
going concern.
PALISADES 6300: Plan Outline Hearing Scheduled for Tomorrow
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada will convene
a hearing tomorrow, Feb. 8, 2012, at 2:00 p.m., to consider
adequacy of the Disclosure Statement explaining Palisades 6300
West Lake Mead, LLC's proposed Plan of Reorganization.
According to the Disclosure Statement, the Plan proposes that
payments and distributions under the Plan will be funded by the
Reorganized Debtor. Claims will be paid from the proceeds of the
Reorganized Debtor's ongoing business operations.
Under the Plan, the Debtor intends to treat claims as, among other
things:
Class 1: Secured Claim of US Bank (13,225,989). US Bank will
retain its lien securing its claim and will be paid in full on or
before ten years from the Effective date.
Class 2: Unsecured Allowed Claims. It is anticipated that all
allowed Class 2 Unsecured claims will receive an amount equal to
100% of the allowed claim, without interest.
Class 3: Equity Interest Holders. The members of the Debtor will
not receive any distributions during the terms of the Plan unless
and until all administrative claims are paid in full and payments
to the allowed claims in Class 2 are paid in full.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/PALISADES_6300_ds.pdf
About Palisades 6300
Palisades 6300 West Lake Mead, LLC, filed for Chapter 11
bankruptcy (Bankr. D. Nev. Case No. 11-26180) on Oct. 13, 2011.
Judge Linda B. Riegle oversees the case. Marjorie A. Guymon,
Esq., at Goldsmith & Guymon, P.C., serves as the Debtor's
bankruptcy counsel. In its schedules, the Debtor disclosed
$17,452,917 in assets and $14,733,148 in liabilities.
The professionals assisting the Debtor consist of Valuation
Consultants as real estate appraiser; B&RE Property Management as
property manager and leasing agent for real property belonging to
the estate; and Kenneth Funsten, FamCo Advisory Services, as
interest rate expert.
PENN TREATY: Deltec Asset Owns 250 Common Shares
------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Deltec Asset Management, LLC, disclosed that,
as of Dec. 31, 2011, it beneficially owns 250 shares of common
stock of Penn Treaty American Corporation representing .0011% of
the shares outstanding. A full-text copy of the filing is
available for free at http://is.gd/haGiwT
About Penn Treaty American
Penn Treaty American Corporation -- https://www.penntreaty.com/ --
through its wholly owned direct and indirect subsidiaries, Penn
Treaty Network America Insurance Company, American Network
Insurance Company, American Independent Network Insurance Company
of New York, Network Insurance Senior Health Division and Senior
Financial Consultants Company, is engaged in the underwriting,
marketing and sale of individual and group accident and health
insurance products, principally covering long term nursing home
and home health care.
On October 2, 2009, the Insurance Commissioner of the Commonwealth
of Pennsylvania filed in the Commonwealth Court of Pennsylvania
Petitions for Liquidation for PTNA and American Network Insurance
Company. PTNA is a direct insurance company subsidiary of Penn
Treaty American Corporation, and ANIC is a subsidiary of PTNA.
PERPETUAL ENERGY: Moody's Lowers CFR to Caa1; Outlook Negative
--------------------------------------------------------------
Moody's Investors Service downgraded Perpetual Energy Inc's
(Perpetual) Corporate Family Rating (CFR), Probability of Default
Rating (PDR) and senior unsecured notes to Caa1 from B3. The
Speculative Grade Liquidity remained SGL-3. The rating outlook is
negative.
Downgrades:
Issuer: Perpetual Energy
-- Probability of Default Rating, Downgraded to Caa1 from B3
-- Corporate Family Rating, Downgraded to Caa1 from B3
-- Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1,
LGD4, 52% from B3, LGD3, 46%
-- Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1,
LGD4, 52% from B3, LGD3, 46%
RATINGS RATIONALE
The downgrade reflects tightening liquidity in a weak natural gas
price environment and a dependence on asset sales to meet a June
debt maturity.
The company's borrowing base (BB) revolver will be revised on
April 30, 2012 (a semi-annual occurrence) and is expected to be
lowered from the current C$190 million, due to both declining
reserves and falling gas prices. On June 30, 2012, the maturity
date of the C$75 million convertible bond, Perpetual will have
about C$140 million drawn on the revolver. With about C$30 million
of availability (after L/Cs and the BB redetermination) Perpetual
must sell assets to repay the C$75 million debt maturity. In 2013
the company may need to sell additional assets to fund expected
negative free cash flow of roughly C$25 million. With minimal
capex expected in 2012 and weak natural gas prices, the company
will continue to show reserve and production declines.
The Caa1 CFR reflects Perpetual's tightening liquidity, the need
to use proceeds from asset sales to repay a June 30, 2012 debt
maturity, production of about 90% gas in a weak gas price
environment, declining production and reserves in 2012 and 2013,
short proved developed (PD) reserve life, and high leverage on PD
reserves. The rating favorably recognizes Perpetual's reasonable
leverage on production, significant size and scale in terms of
reserves and growing oil and liquids production.
The SGL-3 Speculative Grade Liquidity rating reflects adequate
liquidity with the expectation that the company will spend
substantially less capital in 2012 than the C$140 million that was
spent in 2011. As of April 30, 2012 Moody's expects the company to
have about C$35 million available, after letters of credit of
about $7 million, under its borrowing base revolving credit
facility. For calendar 2012 Moody's expects the company to
generate negative free cash flow of about C$20 million, and it has
to fund its bond maturity at the end of June 2012. Moody's expects
the company to be able to sell assets in order to meet this
funding shortfall. Perpetual has two financial covenants under its
revolver, total debt to EBITDA of 4:1 and senior debt to EBITDA of
3:1. Compliance with both covenants should be achievable, but
total debt to EBITDA will be tight through 2012. Perpetual's
assets are pledged to the revolver lenders, but represent a source
of possible alternate liquidity given the company's portfolio of
non-producing development properties.
The negative outlook reflects a number of uncertainties that need
to be favorably resolved in order to maintain the Caa1 rating:
asset sales sufficient to meet the June bond maturity and fund
negative free cash flow, and the availability of sufficient
liquidity to fund upcoming cash requirements, including capital
expenditures.
A change in outlook to stable would be considered if the company
successfully uses the proceeds from asset sales to repay the debt
maturity and continues to grow oil and liquids production,
enhancing cash margins. An upgrade is unlikely in the near term
absent higher gas prices. Over the longer term an upgrade could be
possible if retained cash flow to debt can be maintained above 20%
and the company grows production and reserves. The rating could be
downgraded if liquidity weakens.
The principal methodology used in rating Perpetual was the Global
Independent Exploration and Production Industry Methodology
published in December 2011. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Perpetual is a Calgary, Alberta based exploration and production
company with about 24,000 barrels of oil equivalent (boe) of
production and total proved reserves of 37 million boe.
PROTEONOMIX INC: Employs Jaci Mandil as Chief Executive Officer
---------------------------------------------------------------
Proteoderm, Inc., a controlled subsidiary of Proteonomix, Inc.,
hired Jaci Mandil, of Livingston, New Jersey, as its Chief
Executive and Operating Officer.
Ms. Mandil attended the University of South Dakota Business School
for Business Management & Marketing. She grew up in a family
business in Pierre, South Dakota, where she was a buyer and
marketing manager. She worked as a personal coach and fashion
consultant to various top 10 contestants competing in the Miss
South Dakota Miss America pageant, Miss South Dakota USA & Mrs.
America Pageant USA. She was a regional representative of South
Dakota Retailers in the late 80's. Later she joined the National
Chem-Search, a fortune 500 company and producer of industrial
products as a marketing representative. She moved to NYC to join
International Intimates where she worked for 13 years as a sales
executive who integrated into each customer's business plan making
International Intimates an industry leader. Within that role she
developed business plans, merchandise assortments & distribution
of product. Jaci played a major role in developing new products &
private label programs. She provided an exclusive service to
national department stores & fine specialty retailers worldwide.
Ms. Mandil left that company in May 2005 to raise her family. She
currently resides in New Jersey with her husband and four
children.
About Proteonomix
Proteonomix, Inc. (OTC BB: PROT) -- http://www.proteonomix.com/--
is a biotechnology company focused on developing therapeutics
based upon the use of human cells and their derivatives.
The Company reported a net loss applicable to common shares of
$973,532 on $18,994 of sales for the nine months ended
Sept. 30, 2011, compared with a net loss applicable to common
shares of $2.32 million on $68,972 of sales for the same period
during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $3.37
million in total assets, $6.93 million in total liabilities,
and a $3.55 million total stockholders' deficit.
As reported in the TCR on April 1, 2011, KBL, LLP, in New York,
expressed substantial doubt about Proteonomix, Inc.'s ability to
continue as a going concern, following the Company's 2010 results.
The independent auditor noted that the Company has sustained
significant operating losses and is currently in default of its
debt instrument and needs to obtain additional financing or
restructure its current obligations.
QUEEN CITY: TV Retailer Files for Chapter 11 Bankruptcy
-------------------------------------------------------
Ely Portillo at The Charlotte Observer reports that Queen City
Television Service Co., aka Queen City Audio Video & Appliances,
filed on Feb. 1, 2012, for Chapter 11 protection, listing assets
of less than $50,000, and liabilities of between $1 million and
$10 million.
The report says the Company has between 200 and 999 creditors with
outstanding debts.
According to the report, the bankruptcy filing represents a
decline for a company that was looking to expand aggressively
before the recession. In 2006, Queen City opened its 14th store,
in Hickory, and planned a distribution center in Morganton, North
Carolina. The company hoped to compete with big-box retailers
such as Wal-Mart, Best Buy and Target.
The report notes that Queen City has retained Richard Wright of
Moon, Wright & Houston as legal counsel.
Queen City is still run by the Player family, with Woody Player's
son, Roddey Player, as the CEO. There are now seven Queen City
Audio, Video & Appliances retail stores -- in Charlotte,
Statesville, Morganton, Mooresville, Salisbury and Rock Hill.
QUEEN CITY: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Queen City Television Service Co., Inc.
aka Queen City Audio Video Appliances
2430 Queen City Drive
Charlotte, NC 28208
Bankruptcy Case No.: 12-30241
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
Western District of North Carolina (Charlotte)
Judge: Laura T. Beyer
Debtor's Counsel: Richard S. Wright, Esq.
MOON WRIGHT & HOUSTON, PLLC
227 W. Trade Street, Suite 1800
Charlotte, NC 28202
Tel: (704) 944-6564
Fax: (704) 944-0380
E-mail: rwright@mwhattorneys.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Roddey H. Player, Sr., chief executive
officer.
RAY ANTHONY: Court to Consider Deal on Case Dismissal Opposition
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
will convene a hearing on Feb. 9, 2012, at 2:00 p.m. to consider a
stipulation and order resolving objection to Ray Anthony
International, LLC's motion to dismiss case.
The Debtor and Liberty Surplus Insurance Corporation, had ask that
the Court approve a stipulation which provides that:
1. Upon execution of the stipulation, Liberty will file a
Notice of Withdrawal whereby the Liberty Objection to dismissal
of the case and limited objection to the consent motion for
relief from the automatic stay will be withdrawn under the
terms and conditions stated herein.
2. The withdrawal of the Liberty objection, and subsequent
dismissal of the bankruptcy case, will be without prejudice to
any rights, claims, defenses and obligations arising under the
Insurance Agreements, all of which are fully reserved and
preserved.
3. To facilitate in the defense of any claims tendered to
Liberty, Debtor will within 30 days use its best efforts to
provide to Liberty: (i) all information about any of its other
primary, umbrella or excess insurers that issued policies that
may provide coverage during the policy terms of 10/1/08 to
10/1/09 and 10/1/10 to 7/18/11 including, without limitation,
the name and address of any such insurer, the policy terms and
limits of any policy issued by such insurer, and a contact
person(s) for each insurer identified; (ii) copies of all
records regarding any claims that have been and, in the future
will be, tendered to Liberty for coverage under the Insurance
Agreements, including, without limitation, the claims of
Cossman, Talbert and Smith; and (iii) any other documents,
records or information of any kind that Liberty deems necessary
to assist in the defense of any claims that Debtor has or will
be tendered to Liberty for coverage under the Insurance
Agreements.
On Dec. 5, 2011, the Court required the parties briefing on the
issues raised in the objection related to the automatic stay and
cooperation by the Debtor before it is prepared to rule on the
motion.
As reported in the Troubled Company Reporter on Dec. 20, 2011, the
Debtor and The Huntington National Bank asked that the Court enter
a Stipulated Agreed Order dismissing the Debtor's Chapter 11 case
and retaining jurisdiction over any present or future litigation
among Huntington and other creditors arising out of and relating
to conflicting purchase money security interests ("PMSI
Litigation?).
Huntington is the Debtor's senior secured lender with a blanket
lien on all the Debtor's assets, inventory, equipment, etc. As
the Debtor's senior secured lender, Huntington consents to the
Motion to Dismiss.
Huntington and the Debtor believe that the majority of the PMSI
Litigation has been resolved, however Huntington and the Debtor
believe and aver that it would be in the best interest of all
parties for the Honorable Court to retain jurisdiction over the
PMSI Litigation.
A copy of the motion for Stipulated Agreed Order dismissing the
Debtor's case is available for free at:
http://bankrupt.com/misc/rayanthony.dkt1055.pdf
Debtor's Motion to Dismiss (Doc. No. 1034)
Ray Anthony International, Inc., had earlier filed a motion to
dismiss its case with the Bankruptcy Court. As reported in the
TCR on Nov. 9, 2011, the Debtor explained that during the
administration of its case, it sold the the bulk of its crane
rental/lease operations in two separate motions for sale for its
Texas and Pennsylvania operations. The two sales of the Debtor's
assets resolved the bulk of the claims in this Estate. As a
result, the Debtor no longer has an ability to fund a feasible
Plan of Reorganization.
On Nov. 22, 2011, Liberty Surplus Lines Insurance Company filed
its objection to the Debtor's motion to dismiss.
Liberty tells the court that "best interests of the creditors and
the bankruptcy estate"will be best served if this case is instead
converted to a case under Chapter 7. Liberty says that the
dismissal of the Chapter 11 case significantly prejudice it, as
well as other creditors because:
-- Only conversion of this case to a case under Chapter 7 would
preserve certain enhanced rights in bankruptcy (e.g., the
ability to collect proceeds to satisfy outstanding self-
insured retention provision ("SIR?) obligations) that would
otherwise be lost if the case were dismissed;
-- Without a Chapter 7 fiduciary in place, there would be no
means by which cooperation in the defense of the tort claims
against the Debtor, including, without limitation, access to
Debtor's records, could be effected; and
-- Only conversion of this case to a case under Chapter 7 would
permit an orderly liquidation of Tort Claims and an equitable
distribution to the extent of Debtor's finite insurance
assets.
A copy of Liberty's Objection is available for free at:
http://bankrupt.com/misc/rayanthony.dkt1049.pdf
About Ray Anthony International
West Mifflin, Pennsylvania-based Ray Anthony International, Inc.,
before liquidating substantially all of its assets, owned and
operated a crane rental/leasing company. The Company filed for
Chapter 11 bankruptcy protection (Bankr. W.D. Pa. Case No. 10-
26576) on Sept. 15, 2010. The Debtor estimated assets
and debts at $50 million to $100 million as of the Chapter 11
filing. Affiliate Ray G. Anthony filed a separate Chapter 11
petition (Bankr. W.D. Pa. Case No. 10-26552) on Sept. 14, 2010.
Robert O. Lampl, Esq., John P. Lacher, Esq., and Elsie R. Lampl,
Esq., at the Law Offices of Robert O. Lampl, in Pittsburgh, Pa.,
represent the Debtor as counsel.
The Debtor has sold a large portion of its assets by way of the
B&G Crane Service, LLC and Red White and Blue Crane, LLC sales.
Certain funds from various sales of assets, including but not
limited to, B&G Crane Service, LLC, and Red White and Blue Crane,
LLC, have been placed in to escrow subject to being released and
paid only upon an order of the Bankruptcy Court or agreement by
the parties holding lien claims. These funds will remain in
escrow under the same terms and conditions and will not be
released without Huntington's written consent.
REDDY ICE: Robert Mead Discloses 6.9% Equity Stake
--------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Robert E. Mead disclosed that, as of Dec. 31,
2011, he beneficially owns 1,626,067 shares of common stock of
Reddy Ice Holdings, Inc., representing 6.95% of the shares
outstanding. A full-text copy of the filing is available for free
at http://is.gd/M6ng8u
About Reddy Ice
Reddy Ice Holdings, Inc. is a manufacturer and distributor of
packaged ice in the United States. With approximately 1,500 year-
round employees, the Company sells its products primarily under
the widely known Reddy Ice(R) brand to a variety of customers in
34 states and the District of Columbia. The Company provides a
broad array of product offerings in the marketplace through
traditional direct store delivery, warehouse programs and its
proprietary technology, The Ice Factory(R). Reddy Ice serves most
significant consumer packaged goods channels of distribution, as
well as restaurants, special entertainment events, commercial
users and the agricultural sector.
The Company also reported a net loss of $36.15 million on $273.57
million of revenue for the nine months ended Sept. 30, 2011,
compared with a net loss of $11.47 million on $260.20 million of
revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed $460.94
million in total assets, $525.26 million in total liabilities and
a $64.32 million total stockholders' deficit.
* * *
Reddy Ice carries 'B-' issuer credit ratings, with "negative"
outlook, from Standard & Poor's.
As reported by the TCR on Nov. 8, 2011, Moody's Investors Service
lowered Reddy Ice Holdings, Inc.'s corporate family and
probability-of-default ratings to Caa1 from B3, and its $12
million senior discount notes due 2012 to Caa3 from Caa2. Moody's
also lowered the rating on Reddy Ice Corporation's $300 million
first lien senior secured notes due 2015 to B3 from B2 and the
$139 million second lien notes due 2015 to Caa3 from Caa2. The
ratings outlook remains negative. The speculative grade liquidity
rating was affirmed at SGL-3.
The ratings downgrade reflects Moody's expectation that Reddy
Ice's operating performance is unlikely to materially improve over
the foreseeable future given the uncertain macro environment and
the competitive nature of the U.S. packaged ice industry.
REPUBLIC MORTGAGE: Moody's Withdraws 'Caa2' IFSR
------------------------------------------------
Moody's Investors Service has withdrawn the Caa2 insurance
financial strength rating of Republic Mortgage Insurance Company
(RMIC). Prior to the withdrawal, RMIC's rating carried a negative
outlook.
RATINGS RATIONALE
Moody's has withdrawn the rating for its own business reasons.
Based in Winston-Salem, NC Republic Mortgage Insurance Company had
$100 million of statutory capital as of September 30, 2011.
ROCK POINT: DMARC 2006 Wants $292,000 Adequate Protection Payment
-----------------------------------------------------------------
Creditor DMARC 2006-CD2 Corporate Center, LLC, asks the U.S.
Bankruptcy Court for the Eastern District of Washington to enter
a second interim order authorizing Rock Point Holdings Company,
LLC to use its cash collateral.
DMARC also requested that the order will continue the provisions
of the first interim cash collateral order entered on Dec. 30,
2011, but authorizes the payment of $292,000 to DMARC as monthly
adequate protection payments.
DMARC relates that a second interim order is necessary because the
parties disagree on issues related to the amount of the adequate
protection payment and turnover of any moneys to the debtor-in-
possession. Those issues, and potentially others, will require an
evidentiary hearing that will require a one day hearing with
witnesses.
On a previous interim order, the Court authorized the use of the
cash collateral, however, the receiver (Te Durant & Associates,
Inc.) and BRMI will make no adequate protection or other payments
to DMARC pending the final hearing on adequate protection and use
of cash collateral and will retain all unexpended funds in the
operational bank account.
As adequate protection from diminution in value of the lender's
collateral, the Debtor will grant DMARC portpetition security
interest and lien with the same priority as CMARC's existing lien
and security interest payments and cash collateral.
Dec. 3, 2010 Te Durant & Associates, Inc., was appointed receiver
of the property -- real property situated at 1212 and 1330 North
Washington Street, 1313 North Atlantic Street and 316 West Boone
Avenue , Spokane, Spokane County, Washibgton, plus certain
personal property located thereon and cash collateral.
About Rock Pointe
Rock Pointe Holdings Company LLC owns the Rock Pointe Corporate
Center in Spokane, Washington. The Company filed for Chapter 11
protection (Bankr. E.D. Wash. Case No.11-05811) on Dec. 2, 2011.
Brett L. Wittner, Esq., at Kent & Wittner PS, represents the
Debtor. The Debtor estimated both assets and debts of between
$50 million and $100 million.
ROCKWOOD SPECIALTIES: Moody's Rates Tranche A Loan at 'Ba1'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to Rockwood
Specialties Group, Inc.'s (Rockwood) new $350 million senior
secured Term Loan A due 2017. Rockwood's Ba2 Corporate Family
Rating (CFR) and existing debt ratings were unaffected by this
action. The new term loan, which will become a component of the
existing senior secured credit facility, will be used in
conjunction with $200 million of balance sheet cash to retire
Rockwood's senior subordinated debt. The rating outlook is stable.
These summarizes the ratings:
Rockwood Specialties Group, Inc,
Ratings assigned:
Sr sec term loan A due 2017 -- Ba1 (LGD3, 37%)
Ratings to be withdrawn upon closing of the refinancing:
Sr sub bonds - B1 (LGD5, 88%) from B1 (LGD6, 90%)
RATINGS RATIONALE
Rockwood's Ba2 CFR is supported by its business profile, size
($3.7 billion in revenues), relatively stable earnings, attractive
margins and positive free cash flow through the business cycle.
The company has four operating segments with inorganic chemical
businesses, that provide diversification of revenues and have
relatively little exposure to volatile petrochemical feedstock
prices.
Its EBITDA margins have averaged over 20% from 2006 through the
first nine months of 2011, with the margin for the twelve months
ended September 30, 2011, topping 23%. The titanium dioxide
pigments segment's EBITDA margin increased dramatically from 2009
to 2011 and each of the other segments have shown more modest
improvements. Moody's expects the titanium dioxide industry to
support strong margins during 2012 that are higher than those
realized prior to the 2008-09 downturn, but the industry could
come under some margin pressure because of higher titanium ore
feedstock prices in 2012. Free cash flow has been positive since
2005, allowing the company to delever.
Rockwood has significant debt balances ($1.7 billion as of
September 30, 2011), but leverage is a manageable 2.8x. Moody's
expects the firm to continue to focus on delevering in 2012 and
2013, further improving its credit metrics. The repayment of
Rockwood's high coupon subordinated debt will lower balance sheet
debt by $185 million ($535 million principal amount for the
retired subordinated debt less $350 million for the new term loan)
and reduce the interest expense burden.
Moody's could move to a positive outlook or upgrade Rockwood's
ratings if credit metrics improve further such that leverage was
expected to be below 2.2x on a sustainable basis. Generally,
Moody's will expect its credit metrics to be strong for the rating
category, because certain of its businesses are enjoying peak
cyclical conditions, and Moody's expects profitability to be
supportive of the rating through varying economic environments.
Further positive rating action will also depend on management's
financial strategy. Specifically, Moody's will assess if
management has the board of directors' support to establish a
financial profile for Rockwood that produces sustainable financial
metrics that would support a goal of achieving a rating in the
upper level of the Ba category.
Moody's will consider possible downward pressure on the ratings if
the free cash flow ratio drops below 4% or if debt levels rise.
While Moody's recognizes that Rockwood has a history of bolt-on
acquisitions any significant debt financed acquisitions could also
have a negative effect on the rating.
The principal methodology used in rating Rockwood Specialties was
the Global Chemical Industry Methodology published in December
2009. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Rockwood Specialties Group, Inc., headquartered in Princeton, New
Jersey, is a global producer of a variety of specialty chemicals
and materials, including pigments, additives, specialty compounds,
ceramics, and electronics for use in businesses ranging from life
sciences to automotive manufacturing. Rockwood operates through
the following three business sectors: Specialty Chemicals,
Pigments and Additives, and Advanced Materials. Revenues were $3.7
billion for the twelve months ended September 30, 2011.
RYAN'S RESTAURANT: Bankruptcy Stays Gloria Anderson Lawsuit
-----------------------------------------------------------
Magistrate Judge Shiva V. Hodges stayed the proceedings in the
lawsuit, Gloria Eloise Anderson, Plaintiff, v. Ryan's Restaurant,
Defendant, C/A No.: 3:11-1398-CMC-SVH (D. S.C.), in view of Ryan's
Restaurant's bankruptcy filing, according to a Feb. 1 Order
available at http://is.gd/emSAjqfrom Leagle.com. If and when the
Bankruptcy Court issues an order that may lift or modify the
automatic stay, the parties to the adversary case must indicate so
to the District Court by filing a status report, Judge Hodges
said.
Ryan's Restaurant Group, Inc., filed a Chapter 11 petition (Bankr.
D. Del. Case No. 12-10245) on Jan. 18, 2012. Ryan's Restaurant is
represented by:
Christopher Near, Esq.
OGLETREE DEAKINS NASH SMOAK AND STEWART
1320 Main Street, Suite 600
Columbia, SC 29201
E-mail: chris.near@ogletreedeakins.com
SABINE PASS: Moody's Reviews 'B3' Rating for Possible Upgrade
-------------------------------------------------------------
Moody's Investors Service placed Sabine Pass LNG, LP's (Sabine
Pass or Project) B3 rating under review for possible upgrade
RATINGS RATIONALE
Sabine Pass is 88.9% indirectly owned by Cheniere Energy Inc
(Cheniere, not rated) and Sabine Pass's credit quality remains
closely linked to Cheniere since Sabine Pass currently represents
most of Cheniere's consolidated cash flows and operating assets
and has extensive contractual agreements.
The rating action reflects Sabine Pass Liquefaction LLC's (SPL)
substantial process in developing a large liquefaction project,
which is an indirect subsidiary of Cheniere and an affiliate of
Sabine Pass. To date, Cheniere has been successful in finalizing
major project contracts for SPL including the EPC contract and
four long-term offtake agreements with investment grade
counterparties. Anticipated contracted revenue from the
liquefaction project ranges from $411 million to over $2 billion
depending on the number of LNG trains completed and placed into
operations. These revenues are likely to substantially improve
Cheniere's financial profile. Cheniere anticipates the LNG trains
reaching operations between the 2015-2018 time frame.
Additionally, Sabine Pass is expected to directly benefit from SPL
since Cheniere Energy Investments (CEI) is expected to assign to
the liquefaction project the existing terminal use agreement (TUA)
between Sabine Pass and CEI. Moody's does not attribute any value
to payments made by CEI to the Project since CEI does not
currently have any meaningful cash flow generating assets other
than Sabine Pass. The assignment of the TUA to SPL is expected to
lead to a substantial increase in cash flows available at the
Project to pay debt once the liquefaction plant reaches commercial
operations.
The rating action also incorporates roughly $391 million in equity
issuances at Cheniere and at Cheniere Energy Partners over the
last four months resulting in approximately $300 million in debt
reduction at Cheniere in January 2012. The recent debt payment
eliminated Cheniere's May 2012 debt maturity and reduced debt to
approximately $487 million compared to the prior amount of nearly
$800 million. That said, Cheniere still faces a $205 million
convertible note due in August 2012 and continues to be cash flow
negative.
During the review period over the next 3 to 6 months, Moody's will
assess Cheniere's ability to achieve project development
milestones including the receipt of FERC authorization, completion
of necessary financing and the commencement of construction.
Cheniere anticipates FERC approval and financing commitments for
the liquefaction plant in Q1 2012 and the start of construction
thereafter in 2012.
Over the next six months, Moody's will also assess Cheniere's
progress in addressing its near term debt maturities and its
negative cash flow position. Sabine Pass's rating could improve by
one or more notches and the extent of any rating improvement
depends on Cheniere's execution of these milestones items and the
underlying provisions.
Sabine Pass LNG L.P. was formed in 2004 to construct, own and
operate a liquefied natural gas (LNG) receiving terminal with an
aggregate regasification capacity of 4 Bcf/d. Sabine has signed
three 20-year Terminal Use Agreements (TUA's) for 100% of its
regasification capacity on a "take or pay" basis. Sabine is 88.8%,
indirectly-owned by Cheniere Energy, Inc (not rated).
The last rating action on Sabine Pass occurred on January 5, 2011,
when the rating on Project's B3 rating was confirmed and the
outlook was changed to negative from under review for possible
downgrade.
The principal methodology used in this rating was Generic Project
Finance Methodology published in December 2010.
SHASTA LAKE: Stipulation for Cash Use Until March 31 Approved
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California
approved a stipulation authorizing Shasta Lake Resorts, LP's use
of cash collateral until March 31, 2012.
The stipulation was entered between the Debtor and secured
creditor Bank of America, N.A.
A full-text copy of the approved budget is available for free at:
http://bankrupt.com/misc/SHASTALAKE_CC_stipulatedorder.pdf
As reported on the Dec. 5, 2011 edition of the Troubled Company
Reporter, the Debtor proposed (i) to provide BofA with replacement
liens in the income generated from the operation of its business
from the time of the Chapter 11 petition forward to the extent of
the cash used if there is an ultimate finding that the Debtor's
cash and receivables constitute BofA's collateral; and (ii) to
continue making monthly adequate protection payments to BofA equal
to the amount of interest accrued on a daily basis at a rate of
Prime plus 2.5% per annum on the unpaid principal balance of the
loan no later than the 1st calendar day of each month pursuant to
the terms of the Cash Collateral Stipulation.
Bank of America, N.A. is represented by:
Patricia H. Lyon, Esq.
James H. French, Esq.
Celine Nui, Esq.
FRENCH & LYON
22 Battery Street, Suite 94111
Tel: (415) 597-7849
Fax: (415) 243-8200
E-mail: phlyon@aol.com
cmui@frenchandlyon.com
About Shasta Lake
Lodi, California-based Shasta Lake Resorts LP, also known as
houseboats.com, is a leading supplier of luxury houseboat rentals
in Northern California, operating a fleet of approximately 65
houseboats primarily out of its Jones Valley Resort on Shasta Lake
and its New Melones Lake Marina. SLR offers a full service dock
at both Jones Valley Resort and New Melones Lake Marina, with
overnight and year round moorage and small boat and accessory
rentals. SLR also operates floating stores, which sell everything
its customers may want to complete their houseboating experience,
including grocery items, bait and tackle, water sports and marine
items, unique gifts and apparel. SLR offers slip rentals at
Sugarloaf Resort on Shasta Lake.
Shasta Lake disclosed $11,711,440 in assets and $6,796,283 in
liabilities as of the Chapter 11 filing.
SLR filed voluntary petition for reorganization under Chapter 11
of the U.S. Bankruptcy Code (Bankr. E.D. Calif. Case No. 11-37221)
on July 13, 2011. Judge Christopher M. Klein is assigned to the
case.
Jamie P. Dreher, Esq., at Downey Brand LLP, in Sacramento,
California, represents SLR.
About Shasta Lake
Lodi, California-based Shasta Lake Resorts LP, also known as
houseboats.com, is a leading supplier of luxury houseboat rentals
in Northern California, operating a fleet of about 65 houseboats
primarily out of its Jones Valley Resort on Shasta Lake and its
New Melones Lake Marina. SLR offers a full service dock at both
Jones Valley Resort and New Melones Lake Marina, with overnight
and year round moorage and small boat and accessory rentals. SLR
also operates floating stores, which sell everything its customers
may want to complete their houseboating experience, including
grocery items, bait and tackle, water sports and marine items,
unique gifts and apparel. SLR offers slip rentals at Sugarloaf
Resort on Shasta Lake.
Andrew D. Smith acts as the Debtor's special counsel. David L.
Edwards is the special counsel to prosecute, on the Debtor's
behalf, an action filed in the Superior Court of the State of
California, Shasta County, against Kenneth Tellstrom.
SLR filed a Chapter 11 bankruptcy petition (Bankr. E.D. Calif.
Case No. 11-37221) on July 13, 2011. Judge Christopher M. Klein
is assigned to the case. Jamie P. Dreher, Esq., at Downey Brand
LLP, in Sacramento, California, represents SLR. The Debtor
disclosed $11,958,504 in assets and $6,884,215 in liabilities as
of the Chapter 11 filing.
SLAVERY MUSEUM: Wants More Time to File Delinquent Tax Returns
--------------------------------------------------------------
The Associated Press reports that Sandra R. Robinson, attorney for
the U.S. National Slavery Museum in Virginia, is seeking more time
to produce delinquent tax returns in a bid to reorganize the
museum's debt and resume fundraising.
The report says Ms. Robinson had told U.S. Bankruptcy Court she
would produce the tax returns by the end of January. Last week,
she said the museum has been unable to secure the returns from the
museum's former accountant.
According to the report, Mr. Robinson is seeking the returns to
resume raising funds for the museum, which had been planned for
Fredericksburg, Maryland.
The United States National Slavery Museum, based in Richmond,
Virginia, filed for Chapter 11 protection (Bankr. E.D. Va. Case
No. 11-36013) on Sept. 21, 2011. Judge Douglas O. Tice, Jr.,
presides over the case. Sandra Renee Robinson, Esq., at Robinson
Law & Consulting Firm, P.C., represents the Debtor. The Debtor
estimated both assets and debts of between $1 million and
$10 million.
SNEAKERS JAX: Case Summary & 10 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Sneakers Jax Beach, LLC
111 Beach Blvd.
Jacksonville Beach, FL 32250
Bankruptcy Case No.: 12-00533
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Middle District of Florida (Jacksonville)
Debtor's Counsel: Brett A Mearkle, Esq.
LAW OFFICE OF BRETT A. MEARKLE
8777 San Jose Blvd., Suite 801
Jacksonville, FL 32217
Tel: (904) 352-1342
Fax: (904) 352-1814
E-mail: bmearkle@mearklelaw.com
Scheduled Assets: $1,880,500
Scheduled Liabilities: $2,182,918
A copy of the list of 10 largest unsecured creditors is
available for free at http://bankrupt.com/misc/flmb12-00533.pdf
The petition was signed by Gregory J. Pratt, managing member.
SOLAR DRIVE: Court Dismisses Chapter 11 Case
--------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
has dismissed the Chapter 11 case of Solar Drive, LLC, based on
findings of fact and conclusions of law stated orally and recorded
in open court.
Los Angeles, California-based Solar Drive, LLC, filed for Chapter
11 bankruptcy (Bankr. C.D. Calif. Case No. 11-42298) on July 28,
2011. Judge Peter Carroll presides over the case. Carolyn A.
dye, Esq., serves as bankruptcy counsel. In its petition, the
Debtor estimated $10 million to $50 million in assets and
$1 million to $10 million in debts. The petition was
signed by Tim Devine, manager.
SOLYNDRA LLC: Ex-Employees Question Sale, 3rd Party Releases
------------------------------------------------------------
Jacqueline Palank, writing for Dow Jones' Daily Bankruptcy Review,
reports that Solyndra LLC's former workers, who sued the Company
for not giving them enough notice before its abrupt shutdown last
summer, are now accusing Solyndra of running its bankruptcy for
the benefit of secured lender Argonaut Ventures I LLC.
"The debtors are readying Argonaut's collateral for sale and using
their bankruptcy cases and this court as a friendly forum to
liquidate Argonaut's collateral for Argonaut," the employees said
in court papers filed Tuesday, according to DBR. "In effect, the
debtors are burning down their house to stay warm. Unfortunately,
creditors like the [former employees] are left out in the cold."
DBR also reports the employees were irked with the dumping of the
glass tubes used in Solyndra's solar panels. Citing a post from
former Fox News host Glenn Beck's news and opinion Web site, the
Blaze, the former employees complain that Solyndra "literally
trashed an opportunity" to return the tubes to the vendor and
settle its multimillion-dollar claim against Solyndra.
Solyndra's lawyers, Debra Grassgreen, Esq., told Dow Jones Tuesday
that Solyndra did offer to send the tubes back but the vendor
would only accept them if Solyndra paid for shipping them
overseas. This was too expensive, Ms. Grassgreen said, and the
solar-panel company couldn't find any buyers for the tubes.
The report also notes the creditors expressed anger at what they
deem "gratuitous" liability releases for Solyndra's prebankruptcy
lenders, including Argonaut. These releases are a term of
Solyndra's $4 million bankruptcy loan, which the bankruptcy court
approved in September on the condition that the ex-employees
retain the right to oppose the releases down the line.
"The scope of the relief requested cannot be understated," they
said. "There is no meaningful disclosure or consideration
attendant to the request."
DBR notes that, according to the former employees, the releases
may serve as a blanket defense from lawsuits. The employees will
ask the U.S. Bankruptcy Court at a Feb. 22 hearing to remove the
releases from the bankruptcy-loan terms.
DBR says Argonaut's attorney couldn't be reached for comment.
According to DBR, Ms. Grassgreen on Thursday said the motion
appears to be an attempt by the former employees to "maintain what
little leverage remains" for them.
"The debtors intend to object to the motion because it
mischaracterizes their efforts in the bankruptcy case (the debtors
are presently working on a plan that will benefit multiple
constituencies) and fails to recognize that the releases are
standard provisions in loan documents necessitated by the debtors'
urgent need for financing," she said in an e-mail.
Longer Probe
Meanwhile, Dow Jones' Daily Bankruptcy Review reports that
Solyndra LLC's unsecured creditors have until March 2 to do what
Republicans in Congress haven't managed to do in months of
hearings: mount a legal challenge to the validity of loans from a
private equity firm led by George Kaiser, a fundraiser for
President Barack Obama.
About Solyndra LLC
Founded in 2005, Solyndra LLC is a U.S. manufacturer of solar
photovoltaic solar power systems specifically designed for large
commercial and industrial rooftops and for certain shaded
agriculture applications. The Company had 968 full time employees
and 211 temporary employees. Solyndra has sold more than 500,000
of its panels since 2008 and generated cumulative sales of over
$250 million.
Fremont, California-based Solyndra and affiliate 360 Degree Solar
Holdings Inc. sought Chapter 11 bankruptcy protection (Bankr. D.
Del. Lead Case No. 11-12799) on Sept. 6, 2011. Solyndra is at
least the third solar company to seek court protection from
creditors since August 2011.
Solyndra owed secured lenders $783.8 million, including
$527.8 million to the U.S. government pursuant to a federal loan
guarantee, and held assets valued at $859 million as of the
Petition date. The U.S. Federal Financing Bank, owned by the U.S.
Treasury Department, is the Company's biggest lender.
In the Chapter 11 cases, the Debtors are pursuing a two-pronged
strategy to effectuate either a sale of their business to a
"turnkey" buyer who may acquire substantially all of Solyndra's
assets or, if the Debtors are unable to identify any such
potential buyers, an orderly liquidation of the Debtors' assets
for the benefit of their creditors.
Judge Mary F. Walrath presides over the Debtors' cases. The
Debtors are represented by Pachulski Stang Ziehl & Jones LLP as
legal adviser. AlixPartners LLP serves as noticing claims and
balloting agent. Imperial Capital LLC serves as the company's
investment banker and financial adviser. The Debtors also tapped
former Massachusetts Governor William F. Weld, now with the law
firm McDermott Will & Emery, to represent the company in
government investigations and related litigation. BDO Consulting,
a division of BDO USA, LLP, as financial advisor and BDO Capital
Advisors, LLC, serves as investment banker for the creditors'
panel.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Solyndra LLC. The Committee has tapped
Blank Rome LLP as counsel.
Solyndra is at least the fourth solar company to seek court
protection from creditors since August 2011. Other solar firms
are Evergreen Solar and start-up Spectrawatt Inc., both of which
filed in August, and Stirling Energy Systems Inc., which filed for
Chapter 7 bankruptcy late in September.
SOUTHERN OAKS: Case Summary & 17 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Southern Oaks of Oklahoma LLC, Debtor
fka QCB 08
fka Quail 12
fka 9 ON S.E. 27TH
fka Quail 13
fka 400 S.W. 28th
fka 1609 N.W. 47TH
fka Prairie Village of Oklahoma
fka Southside 10
fka South Robinson
fka 2233 S.W. 29th
P.O. Box 14203
Oklahoma City, OK 73113-4203
Bankruptcy Case No.: 12-10356
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Western District of Oklahoma (Oklahoma City)
Debtor's Counsel: Ruston C. Welch, Esq.
WELCH LAW FIRM P.C.
4101 Perimeter Center Dr., Suite 360
Oklahoma City, OK 73112-2309
Tel: (405) 236-5222
Fax: (405) 231-5222
E-mail: rwelch@welchlawpc.com
Scheduled Assets: $14,788,414
Scheduled Liabilities: $15,352,022
A list of the Company's 17 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/okwb12-10356.pdf
The petition was signed by Stacy Murry, manager of Mbr.
Affiliates that filed separate Chapter 11 petitions:
Petition
Debtor Case No. Date
------ -------- ----
Charlemagne of Oklahoma, LLC 10-13382 07/02/2010
Brookshire Place, LLC 11-10717 02/23/2011
SP NEWSPRINT: Unsecured Creditors Take Aim at Sale Process
----------------------------------------------------------
Dow Jones' DBR Small Cap reports that unsecured creditors said
that SP Newsprint Holdings LLC's sale process "appears to be a
sham" designed to deliver the company's assets to its lenders in
exchange for debt.
About SP Newsprint
Greenwich, Conn.-based SP Newsprint Holdings LLC -- aka Bulldog
Acquisition I LLC, Bulldog Acquisition II LLC, Publishers Papers,
Southeastern Paper Recycling and SP Newsprint Merger LLC -- and
three affiliates, SP Newsprint Co. LLC, SP Recycling Corporation
and SEP Technologies L.L.C, filed for Chapter 11 bankruptcy
(Bankr. D. Del. Lead Case No. 11-13649) on Nov. 15, 2011.
SP Newsprint Holdings LLC is a newsprint company controlled by
polo-playing mogul Peter Brant. It is one of the largest
producers of newsprint in North America. SP Recycling
Corporation, a Georgia corporation and the Debtors' other
operating company, was established in 1980 as a means for SP to
secure a ready supply of recycled fiber, a key raw material for
its newsprint.
SP Newsprint is the second Brant-owned newsprint company to tumble
into bankruptcy proceedings in recent years. Current and former
affiliated entities are Bear Island Paper Company, L.L.C., Brant
Industries, Inc., F.F. Soucy, Inc., Soucy Partners Newsprint,
Inc., White Birch Paper Company.
Judge Christopher S. Sontchi presides over the case. Joel H.
Levitin, Esq., Maya Peleg, Esq., and Richard A. Stieglitz Jr.,
Esq. -- jlevitin@cahill.com , mpeleg@cahill.com and
rstieglitz@cahill.com -- at Cahill Gordon & Reindel LLP serve as
the Debtors' lead counsel. Lee E. Kaufman, Esq., and Mark D.
Collins, Esq. -- kaufman@rlf.com and collins@RLF.com -- at
Richards, Layton & Finger, P.A., serve as the Debtors' Delaware
counsel. AlixPartners LLP serves as the Debtors' financial
advisors and The Garden City Group Inc. serves as the Debtors'
claims and noticing agent. In its petition, SP Newsprint Holdings
estimated $100 million to $500 million in assets and debts. The
petitions were signed by Edward D. Sherrick, executive vice
president and chief financial officer.
ST. JOSEPH HEALTH: Moody's Lowers Long-Term Rating to 'Caa2'
------------------------------------------------------------
Moody's Investors Service has downgraded to Caa2 from Caa1 the
long-term rating assigned to St. Joseph Health Services of Rhode
Island's (St. Joseph) outstanding debt of $18.2 million issued by
the Rhode Island Health and Educational Building Corporation (see
RATED DEBT below). At this time Moody's is removing the rating
from Watchlist. The outlook is negative.
SUMMARY RATING RATIONALE
The downgrade to Caa2 and the negative outlook reflect the
material increase in the pension liability in FY 2011 over FY 2010
which further encumbers weak balance sheet measures and poor
operating performance. Management is proactively endeavoring to
stabilize financial performance and maintain cash balances through
several strategies including evaluating options for potential
capital partnering opportunities.
CHALLENGES
*Increase in the pension liability to $72 million at the end of FY
2011 from $51 million at the end of FY 2010 largely due to the
drop in the discount rate to 4.54% from 5.00%; unrestricted net
assets declined to a negative $61 million resulting in over 100%
debt to capitalization
*Weak cash position as of December 31, 2011
*Management reports that St. Joseph's did not make its rate
covenant in FY 2011 and is seeking a waiver from the new bond
trustee (Wells Fargo)
*Competitive Providence healthcare market
*Weak economy of Rhode Island with 11.5% unemployment
STRENGTHS
*Fully funded debt service reserve
*All fixed rate debt with no derivatives and conservative
investment allocation
*Proactive management taking several immediate steps to stabilize
performance including identifying options for long-term capital
and strategic partnering.
*Part of CharterCARE Health Partners, which represents the
affiliation between St. Joseph and Roger Williams Medical Center,
has lead to the consolidation of all back office services and some
clinical consolidation between the two providers
Outlook
The negative outlook reflects the risk of a possible payment
default and recovery values if St. Joseph's cannot generate
improved cash flow.
What could change the rating -- UP
An upgrade is unlikely in the near-term; over the longer term,
material liquidity gains without additional debt, sustained
operating improvement
What could change the rating -- DOWN
Bond payment default or bankruptcy
The principal methodology used in this rating was Not-for-Profit
Hospitals and Health Systems January 2008.
STARWOOD HOTELS: Fitch Upgrades Issuer Default Rating From 'BB+'
----------------------------------------------------------------
Fitch Ratings has upgraded Starwood Hotels & Resorts Worldwide
Inc.'s (Starwood) ratings to 'BBB-' from 'BB+'. The Rating
Outlook remains Positive.
Fitch has upgraded Starwood's ratings as follows:
-- IDR to 'BBB-' from 'BB+';
-- $1.5 billion senior unsecured credit facility to 'BBB-' from
'BB+';
-- $2.2 billion of senior unsecured notes to 'BBB-' from 'BB+'.
The upgrade reflects the following primary considerations:
-- Lodging demand trends continue on a solid recovery
trajectory, despite heightened global macroeconomic risk.
-- There are factors that cushion downside scenarios in a
potential double dip recession compared to 2008-2009, namely
the attractive supply growth outlook and healthier corporate
balance sheets.
-- Starwood's financial profile has improved such that it is
commensurate with Fitch's investment grade parameters for the
company; it has solid ability to withstand another
significant recession (i.e. a double digit RevPAR decline)
and maintain an investment grade credit profile.
-- Management has demonstrated commitment to returning to and
maintaining an investment grade credit profile.
-- Relative to its peers, Fitch considers the potential for
greater cash flow volatility from Starwood's heavier asset
base and its exposure to higher end and international
segments.
-- However, Starwood's credit profile benefits from being among
the most globally diversified lodging operators with
significant exposure to highly attractive gateway cities.
The Positive Outlook reflects the following considerations:
-- Starwood has deleveraged to comfortably within Fitch's target
levels for a 'BBB-' IDR and is at borderline 'BBB' IDR target
levels.
-- Fitch's base case forecasts EBITDA growth will continue to
fuel deleveraging over the next 12-24 months.
-- A further upgrade will be considered in the context of the
company's financial policies shifting from debt reduction and
credit improvement to growth initiatives and shareholder
friendly actions.
-- Starwood has solid financial flexibility with respect to
liquidity and leverage, as Fitch forecasts it could pay down
the 2013 notes with cash, although Fitch's base case does not
make that assumption.
-- Fitch believes that management will continue to prudently
execute on its longer-term transition to a more asset light
business model.
-- The progression of the European sovereign debt crisis and a
China economic slowdown is also a consideration for an
additional upgrade.
-- Fitch's sovereign team forecasts a sluggish macro-economic
growth scenario with 2012 U.S. and World GDP growth similar
to 2011, before a modest acceleration in 2013.
Industry Fundamentals Remain Positive:
U.S. RevPAR grew 8.2% in 2011 according to Smith Travel. Fitch
expects industry-wide U.S. RevPAR to increase 4%-5% in 2012, with
Starwood continuing to slightly outperform in the U.S. due to its
exposure to higher-end segments that should reflect more positive
operating leverage at this stage of the cycle.
Starwood's exposure internationally has been a positive driver for
much of the lodging recovery but presents more near-term concern
given European sovereign debt issues and slowdown risk in China.
The company's guidance for 2012 RevPAR calls for 5-7% RevPAR
growth on a same-store company operated basis in constant dollars.
U.S. supply growth will be less than 1% annually through at least
2012-2013, which provides cushion to downside scenarios. This is
well below the long-term historical average of roughly 2%, and
contrasts the situation during the recent recession when supply
growth was peaking at more than 3% in 2008-2009. Hotel property-
level operating performance should continue its solid improvement
in 2012-2013 as a result of the favorable supply/demand outlook.
RevPAR growth has been increasingly driven by improvement in the
average daily rate (ADR), while occupancy growth has been
decelerating, which is typical of a maturing lodging cycle. Fitch
expects this trend to continue in 2012-2013, as hotels achieve
optimal occupancy levels, which will contribute to stronger
margins and profitability.
Among its primary peers, Starwood has a heavier asset base and
greater exposure to higher end segments, which could contribute to
greater cash flow volatility. In the near term, Fitch forecasts
that the credit will benefit from the positive operating leverage
associated with its owned asset portfolio and concentration in
luxury, upper-upscale, and upscale segments in urban locations.
Over the medium to longer term, the company will continue to
execute on its transition to an increasingly asset-light business
model. Fitch believes the company will continue to be
opportunistic but prudent with respect to selling assets; recent
asset sales have been executed at very attractive prices for
Starwood.
The lodging industry is highly cyclical and the ratings
incorporate Fitch's macro-economic outlook, which calls for annual
U.S. GDP growth of 1.8% and 2.6% 2012 and 2013, with world
economic growth at 2.4% and 3% over the same time frame.
Starwood is more heavily weighted to the corporate sector and
Fitch expects continued positive trends relating to corporate
profitability and corporate liquidity, providing support to
business travel demands. A significant driver of the timing of
the upgrade is that Fitch's stress case now forecasts that the
company's credit profile has improved to the point that its
financial profile can withstand another significant recession
(i.e. a double digit RevPAR decline) and maintain an investment
grade IDR.
Debt Reduction to Moderate
The upgrade reflects Starwood's continued focus on debt reduction
and commitment to return to investment grade, while its peers'
financial policies shifted to growth initiatives and shareholder
friendly policies earlier in the cycle.
In 4Q'11, the company exercised its redemption option on all of
its 7.875% senior notes due in 2012. The redemption reduced debt
by $605 million. Total non-recourse debt is now roughly $2.2
billion, down from the peak level of $4 billion at year-end 2008.
Fitch believes Starwood's pace of debt reduction will moderate
going forward.
Fitch estimates Starwood's preliminary consolidated lease-adjusted
leverage (including consumer finance profits and securitized debt)
at 3.0 times (x) and its core lease-adjusted leverage (excluding
consumer finance profits and securitized debt) at 2.7x as of
4Q'11.
Core lease-adjusted leverage is comfortably within Fitch's target
for Starwood at the 'BBB-' category of below 3.25x. Fitch
forecasts EBITDA growth in the next 12-24 months will contribute
to further de-leveraging, resulting in core lease adjusted
leverage comfortably within Fitch's target of below 2.75x for a
'BBB' IDR and supporting the Positive Outlook.
The company maintains solid financial flexibility with respect to
refinancing the 2013 notes or paying down with cash. For a
discussion and reconciliation of lodging core versus consolidated
credit metrics, see Fitch's report, 'Inn the Footnotes,' published
Jan. 7, 2011.
Liquidity and Free Cash Flow Outlook
Starwood's liquidity profile is solid, with cash of $666 million
(including $212 million of restricted cash) at the end of 4Q'11.
Including full availability under its $1.5 billion credit facility
due 2013, total liquidity is nearly $2.2 billion. The company's
maturity profile is manageable, with annual maturities of $450
million-$500 million from 2013 through 2015.
Fitch expects the company to continue looking for opportunities to
reduce its portfolio of owned hotels, in order to further
transition to a more asset-light business model. Additional
liquidity from potential asset sales is not explicitly
incorporated into Fitch's forecasts.
Further, Fitch believes management will increasingly focus capital
allocation decisions on growth investments, potential acquisitions
and shareholder friendly initiatives, within the context of upward
rating momentum. Starwood announced on Dec. 1, 2011 that its board
authorized a $250 million share repurchase authorization (see
Fitch's comment, 'Starwood's Ratings Unaffected from Share
Repurchase Authorization' dated Dec. 5, 2011).
Fitch's base case reflects Starwood will generate modest
discretionary annual free cash flow (FCF) in 2012 and 2013,
excluding proceeds from timeshare securitizations and Bal Harbour
residential sales proceeds, which are likely to provide additional
liquidity. As a result, there is flexibility for modest dividend
increases and opportunistic/offensive capital spending.
STOCKDALE TOWER: Files Schedules of Assets and Liabilities
----------------------------------------------------------
Stockdale Tower 1 LLC filed with the U.S. Bankruptcy Court its
schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $17,100,000
B. Personal Property $1,051,072
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $17,275,782
E. Creditors Holding
Unsecured Priority
Claims $9,024
F. Creditors Holding
Unsecured Non-priority
Claims $585,405
----------- -----------
TOTAL $18,151,072 $17,870,212
Bakersfield, California-based Stockdale Tower 1 LLC filed for
Chapter 11 bankruptcy (Bankr. E.D. Calif. Case No. 11-62167) on
Nov. 7, 2011. Judge W. Richard Lee presides over the case. Scott
T. Belden, Esq., and Jacob L. Eaton, Esq., of Klein, DeNatale,
Goldner, Cooper, Rosenlieb & Kimball, LLP, serve as the Debtor's
bankruptcy counsel.
SUMMIT NORTHSTAR: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Summit Northstar Partners
dba BigHorn Center
dba BigHorn Home Improvement Center
c/o Betsy Sather
P.O. Box 4400
Frisco, CO 80498
Bankruptcy Case No.: 12-11503
Chapter 11 Petition Date: January 30, 2012
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Howard R. Tallman
Debtor's Counsel: A. A. Lee Hegner, Esq.
Suite 1800
4550 Cherry Creek South Drive
Denver, CO 80246
Tel: (303) 601-2323
Scheduled Assets: $7,090,000
Scheduled Liabilities: $4,775,915
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Donald S. Sather, general partner.
SUNOCO INC: Moody's Says 'Ba1' CFR Unaffected by Marketing Plans
----------------------------------------------------------------
Moody's commented that with the completion of Sunoco Inc.'s
(Sunoco) strategic review the company is better positioned to
focus on mid-stream logistics and retail product marketing as its
core operations, with greater clarity around its plans to re-
deploy a sizeable portion of its cash liquidity. These plans will
not affect its Ba1 Corporate Family Rating and stable rating
outlook.
RATINGS RATIONALE
Sunoco announced concurrently with its 2011 financial results a
number of steps to allow it to focus on its large investment in
Sunoco Logistics Partners L.P. and on retail marketing as the
drivers of its future growth and returns. It began shuttering the
Marcus Hook refinery in December and is likely to do the same with
its Philadelphia refinery by July 2012 unless it can conclude a
suitable sale. These exposures and the limited sales prospects for
the refineries have resulted in an additional pre-tax charge of
$612 million in the fourth quarter of 2011, including non-cash
book charges and provisions for severance and other cash expenses.
At the same time, Sunoco is taking a number of steps to address
the legacy liabilities, enabling the core businesses to move
forward with a more solid grounding but also using up a sizeable
piece of its $2.06 billion cash position. These steps include $400
million of Sunoco parent debt repayment over the next year, an $80
million pre-tax pension contribution that should cover its funding
obligation for the foreseeable future, $200 million pre-tax to pay
for future retiree benefits, and the contribution of $250 million
pre-tax to establish a standalone captive insurance company. The
latter should shield Sunoco from its legacy environmental
obligations.
With these steps Moody's views Sunoco as better positioned from a
leverage and operating perspective to focus on and support its
core businesses. Sunoco Logistics' Baa2 long-term debt rating
continues to reflect the MLP's stable business portfolio, which
supports its own debt as well as a growing earnings and cash
distribution stream to Sunoco. The retail operations also have a
fairly stable EBITDA profile in the area of $250 million annually
that can internally support retail marketing's capital needs,
absent acquisitions, which could occur as it seeks to grow in the
future. With only its retail operations going forward, Moody's
views parent level Debt/EBITDA in the area of 2.7X, but likely to
be considerably lower with debt adjusted for a continuing cash
position.
In pursuing shareholder rewards, the company announced a 33%
increase in the annual dividend and the intent to repurchase up to
19.9% of its stock over the next 12 to 18 months. The repurchases
will use approximately $800 million of cash, based on the current
stock price.
At this time Moody's does not believe the magnitude or the share
repurchase authorization will affect Sunoco's Ba1 rating or stable
outlook, given its strong cash liquidity position. However, given
the company's reduced operational profile, a continuation of these
policies could be negative for Sunoco's ratings, absent a strong
cash position, particularly if the company undertakes large
acquisitions.
The principal methodology used in rating Sunoco, Inc. was the
Global Refining and Marketing Industry Methodology published in
December 2009, and for Sunoco Logistics Partners, the Global
Midstream Energy Industry Methodology published in December 2010.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Moody's current ratings on Sunoco Inc and affiliates are:
Sunoco Inc.
LT Corporate Family Ratings (domestic currency) Rating of Ba1
Probability of Default Rating of Ba1
Speculative Grade Liquidity Rating of SGL-1
Senior Unsecured (domestic currency) Rating of Ba2
Senior Unsecured MTN (domestic currency) Rating of (P)Ba2
Senior Unsec. Shelf (domestic currency) Rating of (P)Ba2
Subordinate Shelf (domestic currency) Rating of (P)Ba3
Preference Shelf (domestic currency) Rating of (P)Ba3
LGD Senior Unsecured (domestic currency) Assessment of 92 - LGD6
Sunoco Capital I
BACKED Pref. Shelf (domestic currency) Rating of (P)Ba3
Sunoco Capital II
BACKED Pref. Shelf (domestic currency) Rating of (P)Ba3
Sunoco Logistics Partners Operations L.P.
Senior Unsecured (domestic currency) domestic currency 2/9/2009
Baa2
BACKED Senior Unsecured (domestic currency) domestic currency
1/30/2002 Baa2
BACKED Senior Unsec. Shelf (domestic currency) domestic currency
3/19/2003 (P)Baa2
BACKED Subordinate Shelf (domestic currency) domestic currency
3/19/2003 (P)Baa3
SUNOCO INC: Says Stock Buyback Won't Affect Fitch's 'BB+' IDR
-------------------------------------------------------------
Sunoco, Inc.'s (NYSE: SUN) announcement that it intends to
redeploy most of its current cash balances into a range of
strategic initiatives, the largest of which include a stock
buyback program and debt repurchase, is not expected to impact the
company's ratings or outlook at this time.
Fitch currently rates Sunoco as follows:
-- Issuer Default Rating (IDR) 'BB+';
-- Senior unsecured rating 'BB+';
-- Senior secured revolver 'BBB-';
The Ratings Outlook is Stable.
Co-timed with its fourth quarter results, the company laid out a
plan for strategic use of its cash. The largest components of the
plan include a sizable share repurchase (up to 19.9% of shares
outstanding, approximately $800 million); retirement of parent
level debt (up to $400 million); the setup of a fund to eliminate
environmental remediation liabilities ($200 million-$250 million);
prefunding of future retiree medical expenses ($200 million);
prefunding of pension liabilities ($80 million); and an increased
dividend ($17 million). Sunoco's cash and equivalents at Dec. 31,
2011 totaled $2.06 billion, an amount more than adequate to fund
these initiatives.
On July 21, 2011, Fitch downgraded the long-term Issuer Default
Rating (IDR) and other ratings of Sunoco, Inc. to 'BB+' from 'BBB-
' following the recent completion of the SunCoke IPO. The main
catalysts for the downgrade included: reduced business
diversification at Sunoco following the SunCoke spin-off and
disposition of additional Sunoco refining and chemical assets;
increased structural subordination of debt at the parent level to
debt at Sunoco Logistics Partners L.P (SXL; rated 'BBB', with a
Stable Outlook by Fitch); and failure to significantly de-lever at
the Sunoco level following the spin-off. The company has nearly
completed its exit from refining, with the Marcus Hook, PA
refinery idled indefinitely late last year, and the Philadelphia
refinery expected to be sold or idled by July 2012.
TECHNEST HOLDINGS: Amends Form S-1 Registration Statement
---------------------------------------------------------
Technest Holdings, Inc., filed with the U.S. Securities and
Exchange Commission amendment no.2 to Form S-1 registration
statement relating to the resale of up to 25,800,000 shares of the
Company's common stock, par value $0.001 per share, by Southridge
Partners II, LP, which are Put Shares that the Company will put to
Southridge pursuant to the Equity Purchase Agreement.
The Equity Purchase Agreement with Southridge provides that
Southridge is committed to purchase up to $5 million of the
Company's common stock. The Company may draw on the facility from
time to time, as and when the Company determines appropriate in
accordance with the terms and conditions of the Equity Purchase
Agreement.
Southridge is an "underwriter" within the meaning of the
Securities Act in connection with the resale of the Company's
common stock under the Equity Purchase Agreement. No other
underwriter or person has been engaged to facilitate the sale of
shares of the Company's common stock in this offering. This
offering will terminate 24 months after the registration statement
to which this prospectus is made a part is declared effective by
the SEC. For each share of the Company's common stock purchased
under the Equity Purchase Agreement, Southridge will pay the
Company 95% of the average of the lowest closing bid price of the
Company's common stock reported by Bloomberg Finance LP in any
three trading days, consecutive or inconsecutive, of the five
consecutive trading day period commencing the date a put notice is
delivered.
The Company will not receive any proceeds from the sale of these
shares of common stock offered by Selling Security Holder.
However, the Company will receive proceeds from the sale of the
Company's Put Shares under the Equity Purchase Agreement. The
proceeds will be used for working capital or general corporate
purposes. The Company will bear all costs associated with this
registration.
The Company's common stock is quoted on the OTCBB under the symbol
"TCNH.OB." The shares of the Company's common stock registered
hereunder are being offered for sale by Selling Security Holder at
prices established on the OTCBB during the term of this offering.
On Feb. 1, 2012, the closing bid price of the Company's common
stock was $0.025 per share. These prices will fluctuate based on
the demand for the Company's common stock.
A full-text copy of the amended prospectus is available at:
http://is.gd/ZgJkQI
About Technest Holdings
Bethesda, Md.-based Technest Holdings, Inc., has two primary
businesses: AccelPath, which is in the business of enabling
pathology diagnostics and Technest, which is in the business of
the design, research and development, integration, sales and
support of three-dimensional imaging devices and systems.
Wolf & Company, P.C., in Boston, Massachusetts, expressed
substantial doubt about Technest Holdings' ability to continue as
a going concern. The independent auditors noted that the Company
has suffered recurring losses from operations, has negative cash
flows from operations, a stockholders' deficit and a working
capital deficit.
The Company reported a net loss of $2.9 million on $449,937 of
revenues for the fiscal year ended June 30, 2011, compared with a
net loss of $325,235 on $0 revenue for the fiscal year ended
June 30, 2010.
The Company's balance sheet as of Sept. 30, 2011, showed $5.51
million in total assets, $6.21 million in total liabilities and a
$700,374 total stockholders' deficit.
TEXAS MEI: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Texas MEI, LLC
3305 Todville Rd.
Seabrook, TX 77586
Bankruptcy Case No.: 12-30680
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: David R. Jones
Debtor's Counsel: Lawrence J. Maun, Esq.
LAWRENCE J MAUN PC
4545 Mt. Vernon
Houston, TX 77006
Tel: (713) 251-3720
Fax: (713) 481-0831
E-mail: lmaun@maunlaw.com
Estimated Assets: $0 to $50,000
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/txsb12-30680.pdf
The petition was signed by Mike C. Evans, president.
THORPE INSULATION: 9th Cir. Affirms Ruling Against Insurer
----------------------------------------------------------
The U.S. Court of Appeals for the Ninth Circuit issued a ruling
Jan. 30 2012, on an appeal involving Continental Insurance
Company's pursuit of a breach of contract claim against Thorpe
Insulation Company in Thorpe's Chapter 11 bankruptcy proceeding.
The district court affirmed the bankruptcy court's orders denying
Continental's motion to compel arbitration and disallowing its
claim. The Ninth Circuit affirmed that decision in a Jan. 30,
2012 Opinion is available at http://is.gd/fqLwqwfrom Leagle.com.
The case before the Ninth Circuit is, CONTINENTAL INSURANCE
COMPANY, as successor in interest to certain policies issued by
Harbor Insurance Company, Appellant, v. THORPE INSULATION COMPANY,
Appellee, and OFFICIAL CREDITORS COMMITTEE OF THORPE INSULATION
COMPANY AND PACIFIC INSULATION COMPANY, Movant, FUTURE CLAIMS
REPRESENTATIVE, Real-party-in-interest, No. 10-55744 (9th Cir.).
The appellate panel consists of Circuit Judges Mary M. Schroeder
and Ronald M. Gould, and Richard Seeborg, District Judge.
About Thorpe Insulation
Based in Long Beach, California, Thorpe Insulation Company
supplied and distributed asbestos thermal insulation in Southern
California before about 1972. The company's products included
pipe and boiler insulation, asbestos cloth and insulating mud.
After 1972, some of Thorpe's operations also involved asbestos and
lead abatement, including repairing insulation that contained
asbestos at commercial and industrial sites.
On Dec. 17, 2004, Thorpe's lender, Pacific Funding Group LLC, sold
its collateral at a foreclosure sale to Farwest Insulation
Consulting owned by Eric and David Fults. Following the
foreclosure, Thorpe ceased operation of its business. To date,
Thorpe has been subjected to about 12,000 claims and lawsuits
related to asbestos.
Thorpe filed for chapter 11 protection on Oct. 15, 2007 (Bankr.
C.D. Calif. Case No. 07-19271). Jeremy V. Richards, Esq., and
Scotta E. McFarland, Esq., at Pachulski, Stang, Ziehl & Jones,
LLP, represent the Debtor.
Los Angeles-based Pacific Insulation Company was incorporated in
California by Thorpe on May 23, 2000, to be its wholly owned
subsidiary. On Oct. 1, 2000, Pacific transferred 100% of its
shares to Thorpe in exchange for Thorpe's materials division
assets. Thorpe's sole shareholders and board members, Robert W.
Fults and Linda Fults, own 50.1% and 49.9% of Pacific,
respectively. Pacific is a southwest commercial and industrial
insulation distributor and fabricator with locations in Southern
and Northern California, Arizona, and Nevada. It provides pipe,
air handling, fire barrier, board and blanket insulation as well
as adhesives, mastics and sealants. Pacific has never installed
or sold any materials containing asbestos. It currently has 55
full-time employees.
Pacific filed for chapter 11 petition on Oct. 31, 2007 (Bankr.
C.D. Calif. Case No. 07-20016) due to its alleged asbestos
liability and the failure of Thorpe's insurers to pay asbestos
claims asserted against Thorpe. John A. Lapinski, Esq., Leslie R.
Horowitz, Esq., and Stephen R. Hyam, Esq., at Clark & Trevithick,
represent Pacific in its restructuring efforts.
On Nov. 6, 2007, Pacific's case was jointly administered under
Thorpe Insulation's bankruptcy proceeding.
Continental Insurance Company is represented by:
Robert Binion, Esq.
Rodney Eshelman, Esq.
Alan Palmer Jacobus, Esq.
CARROLL, BURDICK & McDONOUGH, LLP
44 Montgomery Street, Suite 400
San Francisco, CA 94104
E-mail: rbinion@cbmlaw.com
reshelman@cbmlaw.com
ajacobus@cbmlaw.com
- and -
David C. Christian II, Esq.
Jason J. DeJonker, Esq.
SEYFARTH SHAW, LLP
131 South Dearborn Street, Suite 2400
Chicago, IL 60603-5577
E-mail: jdejonker@seyfarth.com
Thorpe Insulation Company is represented by:
Daniel J. Bussel, Esq.
David M. Guess, Esq.
Kenneth N. Klee, Esq.
Thomas E. Patterson, Esq.
KLEE, TUCHIN, BOGDANOFF & STERN LLP
1999 Avenue of the Stars, Thirty-Ninth Floor
Los Angeles, CA 90067-6049
E-mail: dbussel@ktbslaw.com
dguess@ktbslaw.com
tpatterson@ktbslaw.com
- and -
Margie I. Dupuis, Esq.
Richard W. Esterkin, Esq.
Asa S. Hami, Esq.
Michel Y. Horton, Esq.
Charles J. Malaret, Esq.
Paul A. Richler, Esq.
MORGAN, LEWIS & BOCKIUS LLP
300 South Grand Ave, 22nd Fl.
Los Angeles, CA 90071-3132
E-mail: resterkin@morganlewis.com
mhorton@morganlewis.com
cmalaret@morganlewis.com
- and -
Thomas M. Peterson, Esq.
Jeffrey S. Raskin, Esq.
MORGAN, LEWIS & BOCKIUS LLP
One Market, Spear Street Tower
San Francisco, CA 94105-1596
E-mail: tmpeterson@morganlewis.com
jraskin@morganlewis.com
- and -
Scotta E. McFarland, Esq.
Jeremy V. Richards, Esq.
PACHULSKI, STANG, ZIEHL, YOUNG, & JONES LLP
Thorpe's Official Creditors Committee and Pacific Insulation
Company are represented by:
Peter J. Benvenutti, Esq.
Michaeline H. Correa, Esq.
JONES DAY
555 California Street, 26th Floor
San Francisco, CA 94104
E-mail: pjbenvenutti@jonesday.com
mcorrea@jonesday.com
- and -
Peter Lockwood, Esq.
Ronald E. Reinsel, Esq.
CAPLIN & DRYSDALE
Washington, D.C.
E-mail: plockwood@capdale.com
rer@capdale.com
The Future Claims Representative is represented by:
Gary Fergus, Esq.
FERGUS, A LAW OFFICE
595 Market Street, #2430
San Francisco, CA 94105
THUNDER ALLEY: Case Summary & 17 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Thunder Alley Properties, LLC
fdba Thunder Alley Enterprises, Inc.
ta Thunder Alley
1224 Magnolia Village Way
Leland, NC 28451
Bankruptcy Case No.: 12-00765
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: Randy D. Doub
Debtor's Counsel: Trawick H Stubbs, Jr., Esq.
STUBBS & PERDUE, P.A.
P.O. Drawer 1654
New Bern, NC 28563
Tel: (252) 633-2700
Fax: (252) 633-9600
E-mail: efile@stubbsperdue.com
Scheduled Assets: $1,925,656
Scheduled Liabilities: $3,336,352
A list of the Company's 17 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/nceb12-00765.pdf
The petition was signed by Ricky A. Roberts, member-manager.
TRAIL INN: Case Summary & 4 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Trail Inn, LLC
P.O. Box 3222
Estes Park, CO 80517
Bankruptcy Case No.: 12-11787
Chapter 11 Petition Date: February 1, 2012
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Sidney B. Brooks
Debtor's Counsel: Ken McCartney, Esq.
P.O. Box 1364
Cheyenne, WY 82003-1364
Tel: (307) 635-0555
E-mail: bnkrpcyrep@aol.com
Scheduled Assets: $2,512,400
Scheduled Liabilities: $2,026,671
A list of the Company's four largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/cob12-11787.pdf
The petition was signed by Leslie Brown, member.
TRAVELPORT INC: Bank Debt Trades at 16% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Travelport Inc. is
a borrower traded in the secondary market at 84.23 cents-on-the-
dollar during the week ended Friday, Feb. 3, 2012, an increase of
0.62 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. The bank loan matures on Aug. 23, 2015, and
carries Moody's B1 rating and Standard & Poor's B rating. The
loan is one of the biggest gainers and losers among 168 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Travelport Holdings
Travelport Holdings is the direct parent of Travelport Limited, is
a broad-based business services company and a leading provider of
critical transaction processing solutions to companies operating
in the global travel industry. With a presence in 160 countries
and approximately 3,500 employees, Travelport is comprised of the
global distribution system (GDS) business, which includes the
Galileo and Worldspan brands and its Airline IT Solutions
business, which hosts mission critical applications and provides
business and data analysis solutions for major airlines.
Travelport also owns approximately 48% of Orbitz Worldwide (NYSE:
OWW), a leading global online travel company. Travelport is a
private company owned by The Blackstone Group, One Equity
Partners, Technology Crossover Ventures, and Travelport
management.
Travelport Holdings Limited is a holding company with no direct
operations. Its principal assets are the direct and indirect
equity interests it holds in its subsidiaries, including
Travelport Limited.
Travelport Limited, a direct subsidiary of Travelport Holdings
Limited, reported net income of $283 million on $1.061 billion of
net revenue for the six months ended June 30, 2011, compared with
net income of $1 million on $1.056 billion of net revenue for the
same period of 2010. Results for the six months ended June 30,
2011, includes gain of $312 million, net of tax, from the sale of
sale of the Gullivers Travel Associates ("GTA") business to Kuoni
Travel Holdings Limited ("Kuoni"). The sale was completed on May
5, 2011.
Loss from continuing operations was $4 million during the six
months ended June 30, 2011, compared with a loss of $2 million for
the same period of 2010.
The Company's balance sheet at Sept. 30, 2011, showed $3.43
billion in total assets, $4.21 billion in total liabilities and a
$780 million total deficit.
* * *
As reported by the TCR on Oct. 10, 2011, Standard & Poor's Ratings
Services lowered its long-term corporate credit ratings on travel
services provider Travelport Holdings Limited (Travelport
Holdings) and indirect subsidiary Travelport LLC (Travelport) to
'SD' (selective default) from 'CC'.
The downgrades follow the implementation of a capital
restructuring, which was necessary because of the Travelport
group's high leverage, weak liquidity, and the upcoming maturity
of its $693 million (as of end-June 2011) PIK loan in March 2012.
"According to our criteria, we view this restructuring as a
distressed exchange and tantamount to a default (see 'Rating
Implications Of Exchange Offers And Similar Restructurings,
Update,' published May 12, 2009, on RatingsDirect on the Global
Credit Portal)," S&P related.
TRAVELPORT INC: Bank Debt Trades at 13% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Travelport Inc. is
a borrower traded in the secondary market at 86.95 cents-on-the-
dollar during the week ended Friday, Feb. 3, 2012, an increase of
1.00 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. The bank loan matures on Aug. 23, 2013, and
carries Moody's B1 rating. The loan is one of the biggest gainers
and losers among 168 widely quoted syndicated loans with five or
more bids in secondary trading for the week ended Friday.
About Travelport Holdings
Travelport Holdings is the direct parent of Travelport Limited, is
a broad-based business services company and a leading provider of
critical transaction processing solutions to companies operating
in the global travel industry. With a presence in 160 countries
and approximately 3,500 employees, Travelport is comprised of the
global distribution system (GDS) business, which includes the
Galileo and Worldspan brands and its Airline IT Solutions
business, which hosts mission critical applications and provides
business and data analysis solutions for major airlines.
Travelport also owns approximately 48% of Orbitz Worldwide (NYSE:
OWW), a leading global online travel company. Travelport is a
private company owned by The Blackstone Group, One Equity
Partners, Technology Crossover Ventures, and Travelport
management.
Travelport Holdings Limited is a holding company with no direct
operations. Its principal assets are the direct and indirect
equity interests it holds in its subsidiaries, including
Travelport Limited.
Travelport Limited, a direct subsidiary of Travelport Holdings
Limited, reported net income of $283 million on $1.061 billion of
net revenue for the six months ended June 30, 2011, compared with
net income of $1 million on $1.056 billion of net revenue for the
same period of 2010. Results for the six months ended June 30,
2011, includes gain of $312 million, net of tax, from the sale of
sale of the Gullivers Travel Associates ("GTA") business to Kuoni
Travel Holdings Limited ("Kuoni"). The sale was completed on May
5, 2011.
Loss from continuing operations was $4 million during the six
months ended June 30, 2011, compared with a loss of $2 million for
the same period of 2010.
The Company's balance sheet at Sept. 30, 2011, showed $3.43
billion in total assets, $4.21 billion in total liabilities and a
$780 million total deficit.
* * *
As reported by the TCR on Oct. 10, 2011, Standard & Poor's Ratings
Services lowered its long-term corporate credit ratings on travel
services provider Travelport Holdings Limited (Travelport
Holdings) and indirect subsidiary Travelport LLC (Travelport) to
'SD' (selective default) from 'CC'.
The downgrades follow the implementation of a capital
restructuring, which was necessary because of the Travelport
group's high leverage, weak liquidity, and the upcoming maturity
of its $693 million (as of end-June 2011) PIK loan in March 2012.
"According to our criteria, we view this restructuring as a
distressed exchange and tantamount to a default (see 'Rating
Implications Of Exchange Offers And Similar Restructurings,
Update,' published May 12, 2009, on RatingsDirect on the Global
Credit Portal)," S&P related.
TRIBUNE CO: Bank Debt Trades at 35% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Tribune Co. is a
borrower traded in the secondary market at 64.83 cents-on-the-
dollar during the week ended Friday, Feb. 3, 2012, an increase of
1.12 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. The bank loan matures on May 17, 2014.
Moody's has withdrawn its rating on the loan. The loan is one of
the biggest gainers and losers among 168 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 (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. 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 Dec. 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)
TRONOX INC: Moody's Says Ba3 CFR Unaffected by Loan Upsize Plan
---------------------------------------------------------------
Moody's Investors Service said Tronox Incorporated's plan to
upsize its Term Loan B to $700 million from $550 million and
change in financial covenants does not change the firm's Ba3
Corporate Family Rating (CFR) or the proposed term loan's Ba2
issue rating.
RATINGS RATIONALE
The principal methodology used in rating Tronox was the Global
Chemical Industry Methodology published in 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Tronox Incorporated (Tronox), headquartered in Oklahoma City,
Oklahoma, is the world's fifth largest producer of titanium
dioxide (TiO2). It operates three plants in Hamilton, MS, Botlek,
The Netherlands, and Kwinana, Australia (Tiwest joint venture is
50% owned by Tronox/50% owned by Exxaro Resources Ltd.). The
company is also a producer of electrolytic chemicals
(approximately 8% of revenues for the twelve months ended
September 30, 2011). Revenues were $1.6 billion for the twelve
months ending September 30, 2011.
TXU CORP: Bank Debt Trades at 39% Off in Secondary Market
---------------------------------------------------------
Participations in a syndicated loan under which TXU Corp., now
known as Energy Future Holdings Corp., is a borrower traded in the
secondary market at 60.58 cents-on-the-dollar during the week
ended Friday, Feb. 3, 2012, an increase of 0.87 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. The
bank loan matures on Oct. 10, 2017, and carries Moody's B2 rating
and Standard & Poor's CCC rating. The loan is one of the biggest
gainers and losers among 168 widely quoted syndicated loans with
five or more bids in secondary trading for the week ended Friday.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
Energy Future Holdings Corp. filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q, reporting a
net loss of $710 million on $2.32 billion of operating revenues
for the three months ended Sept. 30, 2011, compared with a net
loss of $2.90 billion on $2.60 billion of operating revenue for
the same period during the prior year.
The Company also reported a net loss of $1.77 billion on $5.67
billion of operating revenue for the nine months ended Sept. 30,
2011, compared with a net loss of $2.97 million on $6.59 billion
of operating revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed $44.02
billion in total assets, $51.68 billion in total liabilities and a
$7.66 billion total deficit.
The Company's consolidated balance sheets at Dec. 31, 2010, showed
$46.388 billion in total assets, $52.299 billion in total
liabilities, and a stockholders' deficit of $5.911 billion.
* * *
In April 2011, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating, 'Caa3' Probability of Default Rating and
SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is
stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially
distressed company with limited financial flexibility; its capital
structure appears to be untenable, calling into question the
sustainability of the business model; and there is no expectation
for any meaningful debt reduction over the next few years, beyond
scheduled amortizations.
At the end of February 2011, Fitch Ratings it does not expect to
take any immediate rating action on EFH's Texas Competitive
Electric Holdings Company LLC or their affiliates based on recent
default allegations from lender Aurelius. EFH carries a 'CCC'
corporate rating, with negative outlook, from Fitch.
TXU CORP: Bank Debt Trades at 33% Off in Secondary Market
---------------------------------------------------------
Participations in a syndicated loan under which TXU Corp., now
known as Energy Future Holdings Corp., is a borrower traded in the
secondary market at 66.75 cents-on-the-dollar during the week
ended Friday, Feb. 3, 2012, an increase of 3.21 percentage points
from the previous week according to data compiled by Loan Pricing
Corp. and reported in The Wall Street Journal. The Company pays
350 basis points above LIBOR to borrow under the facility. The
bank loan matures on Oct. 10, 2014, and carries Standard & Poor's
CCC rating. The loan is one of the biggest gainers and losers
among 168 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
Energy Future Holdings Corp. filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q, reporting a
net loss of $710 million on $2.32 billion of operating revenues
for the three months ended Sept. 30, 2011, compared with a net
loss of $2.90 billion on $2.60 billion of operating revenue for
the same period during the prior year.
The Company also reported a net loss of $1.77 billion on $5.67
billion of operating revenue for the nine months ended Sept. 30,
2011, compared with a net loss of $2.97 million on $6.59 billion
of operating revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed $44.02
billion in total assets, $51.68 billion in total liabilities and a
$7.66 billion total deficit.
The Company's consolidated balance sheets at Dec. 31, 2010, showed
$46.388 billion in total assets, $52.299 billion in total
liabilities, and a stockholders' deficit of $5.911 billion.
* * *
In April 2011, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating, 'Caa3' Probability of Default Rating and
SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is
stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially
distressed company with limited financial flexibility; its capital
structure appears to be untenable, calling into question the
sustainability of the business model; and there is no expectation
for any meaningful debt reduction over the next few years, beyond
scheduled amortizations.
At the end of February 2011, Fitch Ratings it does not expect to
take any immediate rating action on EFH's Texas Competitive
Electric Holdings Company LLC or their affiliates based on recent
default allegations from lender Aurelius. EFH carries a 'CCC'
corporate rating, with negative outlook, from Fitch.
UNITED GILSONITE: Court Extends Plan Filing Deadline to July 16
---------------------------------------------------------------
U.S. Bankruptcy Court Judge Robert N. Opel II has approved United
Gilsonite Laboratories' motion to extend its exclusive time
periods to file and solicit acceptances of a plan of
reorganization. The Debtor's exclusive period to file a plan is
extended to July 16, 2012. The Debtor's period to solicit
acceptances of any plan is extended to Sept. 13, 2012.
The Debtor's original exclusive plan filing period was set to
expire Jan. 17, 2012, and its exclusive solicitation period was
set to expire March 19, 2012. As reported in the Troubled Company
Reporter on Jan. 13, 2012, Mark B. Conlan, Esq., at Gibbons P.C.,
said that since the Petition Date, the Debtor has made substantial
initial progress toward formulation of a plan. As part of its
plan, the Debtor intends to utilize the provisions of section
524(g) of the Bankruptcy Code, which permit the Court to enter an
injunction channeling all existing and future asbestos-related
personal injury claims to a trust established in accordance with
the requirements of section 524(g). The Debtor said a second
extension of its Exclusivity Periods will allow the Debtor the
time to make significant progress towards the drafting,
negotiating and filing of a chapter 11 plan of reorganization.
About United Gilsonite
Scranton, Pennsylvania-based United Gilsonite Laboratories, a
Pennsylvania Corporation, is a small family-owned corporation
engaged in the manufacturing of wood and masonry finishing
products and paint sundries. It filed for Chapter 11 bankruptcy
protection (Bankr. M.D. Pa. Case No. 11-02032) on March 23, 2011.
Mark B. Conlan, Esq., at Gibbons P.C., serves as the Debtor's
bankruptcy counsel. Joseph M. Alu & Associates P.C. serves as
accountants. K&L Gates LLP serves as special insurance counsel.
Lenahan & Dempsey, P.C., Wilbraham, Lawler & Buba, and Steptoe &
Johnson LLP serve as professionals in the ordinary course of the
Debtor's business. Garden City Group is the claims and notice
agent. The Company disclosed $21,084,962 in assets and $3,008,688
in liabilities as of the Chapter 11 filing.
Roberta A. DeAngelis, United States Trustee for Region 2,
appointed five creditors to serve on an Official Committee of
Unsecured Creditors of United Gilsonite Laboratories. Montgomery,
McCracken, Walker & Rhoads, LLP, represents the Committee.
UNITED RETAIL: Meeting to Form Creditors' Panel on Feb. 9
---------------------------------------------------------
Tracy Hope Davis, United States Trustee for Region 2, will hold an
organizational meeting on Feb 9, 2011, at 10:30 a.m. in the
bankruptcy case of United Retail Incorporated, et al. The meeting
will be held at:
J. Caleb Boggs Federal Building
Office of the United States Trustee
80 Broad St., 4th Floor
New York, NY 10004
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
About United Retail
United Retail Group, owner of the Avenue brand of women's fashion
apparel and a subsidiary of Redcats USA, initiated Chapter 11
proceedings (Bankr. S.D.N.Y. Lead Case No. 12-10405) on Feb. 1,
2012, to sell the business to Versa Capital Management for
$83.5 million.
United Retail, which filed for Chapter 11 with affiliates, is
pursuing a sale process under Section 363 of the Bankruptcy Code,
under which the sale to Versa Capital will be subject to higher
and better offers at an auction.
The Company's legal advisor is Kirkland & Ellis LLP; its financial
advisor is Peter J. Solomon Company; and its restructuring advisor
is AlixPartners. Donlin Recano & Company Inc. is the
administrative agent. Versa Capital's legal advisor is Sullivan &
Cromwell LLP.
United Retail has arranged a $40 million Debtor-in-Possession
facility from its existing revolving credit lender, Wells Fargo,
to provide sufficient working capital for Avenue to continue to
operate the business as usual.
Avenue has 433 stores and an e-commerce site --
http://www.avenue.com/. Avenue employs roughly 4,422 employees,
roughly 294 of which are located at Avenue's corporate
headquarters in Rochelle Park, New Jersey or at the Troy
Distribution Facility.
The Company disclosed $117.2 million in assets and $67.3 million
in liabilities as of the Chapter 11 filing.
UNITED RETAIL: Receives Interim Nod of $25MM Loan
-------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that United Retail Group Inc. received interim approval to
borrow $25 million from a loan facility scheduled to increase to
$40 million at a final financing hearing.
United Retail Group, owner of the Avenue brand of women's fashion
apparel and a subsidiary of Redcats USA, initiated Chapter 11
proceedings (Bankr. S.D.N.Y. Lead Case No. 12-10405) on Feb. 1,
2012, to sell the business to Versa Capital Management for
$83.5 million.
United Retail, which filed for Chapter 11 with affiliates, is
pursuing a sale process under Section 363 of the Bankruptcy Code,
under which the sale to Versa Capital will be subject to higher
and better offers at an auction.
The Company's legal advisor is Kirkland & Ellis LLP; its financial
advisor is Peter J. Solomon Company; and its restructuring advisor
is AlixPartners. Donlin Recano & Company Inc. is the
administrative agent. Versa Capital's legal advisor is Sullivan &
Cromwell LLP.
United Retail has arranged a $40 million Debtor-in-Possession
facility from its existing revolving credit lender, Wells Fargo,
to provide sufficient working capital for Avenue to continue to
operate the business as usual.
Avenue has 433 stores and an e-commerce site --
http://www.avenue.com/. Avenue employs roughly 4,422 employees,
roughly 294 of which are located at Avenue's corporate
headquarters in Rochelle Park, New Jersey or at the Troy
Distribution Facility.
The Company disclosed $117.2 million in assets and $67.3 million
in liabilities as of the Chapter 11 filing.
USG CORP: Borrowings Under TD Bank Loan Hiked to C$40 Million
-------------------------------------------------------------
USG Corporation's indirect, wholly-owned subsidiary, CGC Inc.,
entered into an Amendment to Credit Agreement that amended its
Credit Agreement, dated June 30, 2009, with The Toronto-Dominion
Bank. The Amendment included an increase to the aggregate
principal amount available under the Credit Agreement from C$30
million to C$40 million and extended the term of the agreement.
As amended, the Credit Agreement matures on June 30, 2015, unless
terminated earlier in accordance with its terms, including if by
March 31, 2014, the Company's 9.75% senior notes due in 2014 are
not repaid, their payment is not provided for or their maturity
has not been extended until at least 2016 unless the Company then
has liquidity of at least $500 million.
About USG Corporation
Based in Chicago, Ill., USG Corporation -- http://www.usg.com/--
through its subsidiaries, manufactures and distributes building
materials producing a wide range of products for use in new
residential, new nonresidential and repair and remodel
construction, as well as products used in certain industrial
processes.
The company filed for Chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094). When the Debtors filed for
protection from their creditors, they disclosed $3,252,000,000 in
assets and $2,739,000,000 in debts. The Debtors emerged from
bankruptcy protection on June 20, 2006.
The Company also reported a net loss of $290 million on $2.27
billion of net sales for the nine months ended Sept, 30, 2011,
compared with a net loss of $284 million on $2.24 billion of net
sales for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $3.82
billion in total assets, $3.44 billion in total liabilities and
$375 million in total stockholders' equity.
* * *
As reported by the TCR on Aug. 15, 2011, Standard & Poor's Ratings
Services lowered its corporate credit rating on USG Corp. to 'B'
from 'B+'.
"The downgrade reflects our expectation that USG's operating
results and cash flow are likely to be strained over the next year
due to the ongoing depressed level of housing starts and still-
weak commercial construction activity," said Standard & Poor's
credit analyst Thomas Nadramia. "It is now more likely, in
our view, that any meaningful recovery in housing starts may be
deferred until late 2012 or into 2013. As a result, the risk that
USG's liquidity in the next 12 to 24 months will continue to erode
(and be less than we incorporated into our prior ratings) has
increased. The ratings previously incorporated a greater
improvement in housing starts, which would have enabled USG to
reduce its negative operating cash flow in 2012 and achieve
breakeven cash flow or better by 2013."
In the Sept. 14, 2011, edition of the TCR, Fitch Ratings has
downgraded USG Corporation's Issuer Default Rating (IDR) to 'B-'
from 'B'. The Rating Outlook remains Negative.
The ratings downgrade and the Negative Outlook reflect Fitch's
belief that underlying demand for the company's products will
remain weak through at least 2012 and the company's liquidity
position is likely to deteriorate in the next 18 months. With the
recent softening in the economy and lowered economic growth
expectations for 2011 and 2012, the environment may at best
support a relatively modest recovery in housing metrics over the
next year and a half. Fitch had previously forecast a slightly
more robust housing environment in 2011 and 2012. Moreover, new
commercial construction is expected to decline further this year
and may only grow moderately next year.
VITRO SAB: Court Orders Conversion of VAC Cases to Chapter 7
------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas has
granted the motion of William T. Neary, U.S. Trustee for Region 6,
for the conversion of Former Alleged Debtors Mukki LLC f/k/a Vitro
America, LLC (Case No. 11-32602), Tayo Inc f/k/a Super Sky
Products, Inc. (Case No. 11-32604), BarleySammy Inc. f/k/a Super
Sky International (Case No. 11-32605), VVP Finance Corporation
(Case No. 11-32611), VVP Funding Corporation (Case No. 11-33161),
and VVP Holdings, LLC (Case No. 11-32606), to Chapter 7 effective
Jan. 20, 2012.
The Court also ordered that after conversion, the cases listed
above are no longer to be jointly administered under Vitro Asset
Corp. Case No. 11-32600, but will be jointly administered under
Case No. 11-32602 for procedural purposes only, with any proofs of
claim filed in the proper member case.
As reported in the TCR on Jan. 4, 2012, William T. Neary, United
States Trustee for Region 6, asked the Bankruptcy Court to convert
the Chapter 11 cases of the Former Alleged Debtors to Chapter 7.
In support of his motion, the United States Trustee states:
1. The Debtors no longer generate any revenue because they
have sold substantially all of their assets to American
Glass Enterprises, LLC.
2. Without revenue, the Debtors cannot reorganize.
3. The Debtors have accrued $5,070,962 in postpetition
liabilities, which diminishes estate assets. These
postpetition liabilities include over half a million in
unpaid professional fees, which will continue to accrue so
long as this case remains in chapter 11.
4. The cases could be more efficiently liquidated by a Chapter
7 trustee.
About Vitro SAB
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.
Vitro is the largest manufacturer of glass containers and flat
glass in Mexico, with consolidated net sales in 2009 of MXN23,991
million (US$1.837 billion).
Vitro defaulted on its debt in 2009, and sought to restructure
around US$1.5 billion in debt, including US$1.2 billion in notes.
Vitro launched an offer to buy back or swap US$1.2 billion in
debt from bondholders. The tender offer would be consummated
with a bankruptcy filing in Mexico and Chapter 15 filing in the
United States. Vitro said noteholders would recover as much as
73% by exchanging existing debt for cash, new debt or convertible
bonds.
Concurso Mercantil & Chapter 15 Proceedings
Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a
pre-packaged Concurso Plan in the Federal District Court for
Civil and Labor Matters for the State of Nuevo Leon, commencing
its voluntary concurso mercantil proceedings -- the Mexican
equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB
also commenced parallel proceedings under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan
on Dec. 13, 2010, to seek U.S. recognition and deference to its
bankruptcy proceedings in Mexico.
Early in January 2011, the Mexican Court dismissed the Concurso
Mercantil proceedings. The judge said Vitro couldn't push
through a plan to buy back or swap US$1.2 billion in debt from
bondholders based on the vote of US$1.9 billion of intercompany
debt when third-party creditors were opposed. Vitro as a result
dismissed the first Chapter 15 petition following the ruling by
the Mexican court.
On April 12, 2011, an appellate court in Mexico reinstated the
reorganization. Accordingly, Vitro SAB on April 14 re-filed a
petition for recognition of its Mexican reorganization in U.S.
Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-
11754).
The Vitro parent told the Mexico stock exchange that it received
sufficient acceptances of its reorganization pending in a court
in Monterrey. The approval vote was evidently obtained using
claims of affiliates. The bondholders are opposing the Mexican
reorganization plan because shareholders could retain ownership
while bondholders aren't being paid in full. Bondholders
previously cited an "independent analyst" who estimated the
Mexican plan was worth 49% to 54% of creditors' claims.
In the present Chapter 15 case, the Debtor seeks to block any
creditor suits in the U.S. pending the reorganization in Mexico.
Chapter 11 Proceedings
A group of noteholders opposed the exchange -- namely Knighthead
Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc.,
Davidson Kempner Distressed Opportunities Fund LP, and Brookville
Horizons Fund, L.P. Together, they held US$75 million, or
approximately 6% of the outstanding bond debt. The Noteholder
group commenced involuntary bankruptcy cases under Chapter 11 of
the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D.
Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010.
Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation
counsel to analyze the potential rights that Vitro may exercise
in the United States against the ad hoc group of dissident
bondholders and its advisors.
A larger group of noteholders, known as the Ad Hoc Group of Vitro
Noteholders -- comprised of holders, or investment advisors to
holders, which represent approximately US$650 million of the
Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not
among the Chapter 11 petitioners, although the group has
expressed concerns over the exchange offer. The group says the
exchange offer exposes Noteholders who consent to potential
adverse consequences that have not been disclosed by Vitro. The
group is represented by John Cunningham, Esq., and Richard
Kebrdle, Esq. at White & Case LLP.
The U.S. affiliates subject to the involuntary petitions are
Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case
No.10-47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-
47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-
47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-
47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No.
10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 0-47477);
Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478);
B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479);
Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480);
Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP
Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP
Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX
Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro
Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485).
A bankruptcy judge in Fort Worth, Texas, denied involuntary
Chapter 11 petitions filed against four U.S. subsidiaries. On
April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro
America LLC and three other U.S. subsidiaries -- that were
subject to the involuntary petitions into voluntary Chapter 11.
The Texas Court on April 21 denied involuntary petitions against
the eight U.S. subsidiaries that didn't consent to being in
Chapter 11.
Kurtzman Carson Consultants is the claims and notice agent to
Vitro America, et al. Alvarez & Marsal North America LLC, is the
Debtors' operations and financial advisor.
The official committee of unsecured creditors appointed in the
Chapter 11 cases of Vitro America, et al., has selected Sarah
Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq.,
and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP,
in New York, as counsel. Blackstone Advisory Partners L.P.
serves as financial advisor to the Committee.
The U.S. Vitro companies sold their assets to American Glass
Enterprises LLC, an affiliate of Sun Capital Partners Inc., for
US$55 million.
VIVAKOR INC: Suspending Filing of Reports with SEC
--------------------------------------------------
Vivakor, Inc., filed a Form 15 notifying of its suspension of its
duty under Section 15(d) to file reports required by Section 13(a)
of the Securities Exchange Act of 1934 with respect to its common
stock, par value $0.001 per share. Pursuant to Rule 12h-3, the
Company is suspending reporting because there are currently less
than 300 holders of record of the common shares. There were only
180 holders of the common shares as of Feb. 2, 2012.
About Vivakor Inc.
Coralville, Iowa-based Vivakor, Inc., is a transdisciplinary
research company that develops products in the fields of molecular
medicine, electro-optics, biological handling and natural and
formulary compounds.
The Company's balance sheet at September 30, 2010, showed
$2.65 million in total assets, $2.66 million in total liabilities,
and a stockholders' deficit of $11,602.
As reported in the Troubled Company Reporter on April 9, 2010,
McGladrey & Pullen, LLP, in Cedar Rapids, Iowa, expressed
substantial doubt about Vivakor, Inc.'s ability to continue as a
going concern, following the Company's 2009 results. The
independent auditors noted that the Company's ability to become a
profitable operating company is dependent upon obtaining financing
adequate to fulfill its research and market introduction
activities, and achieving a level of revenues adequate to support
the Company's cost structure.
WASHINGTON MUTUAL: Warrant, Share Holders Want Plan Outline Denied
------------------------------------------------------------------
Dow Jones' Daily Bankruptcy Review reports that investors in
Washington Mutual Inc.'s trust-preferred securities who oppose the
company's Chapter 11 plan are bracing for defeat at an upcoming
confirmation proceeding, and they are readying themselves for a
race to appeal.
Certain parties-in-interest are asking the U.S. Bankruptcy Court
for the District of Delaware to deny approval of the disclosure
statement explaining Washington Mutual Inc.'s Seventh Amended
Joint Plan of Affiliated Debtors as of Dec. 12, 2011.
A group identified as the Pro Se shareholders explain that the
disclosure statement does not meet the requirements for approval
because, among other things:
-- the document incorporated allegation that were unsupported
by factual information so that the voting parties were unable
to independently evaluate the merits of the Plan; and
-- it failed to provide adequate information regarding the
Debtors' assets and liabilities and the feasibility of the
Debtors' Plan.
The Pro Se shareholders note that the Court must deny approval of
the disclosure statement until all the infirmities and
deficiencies raised in the objection are adequately addressed.
Warrant holder Thomas E. Menake, in its objection, state that in
the event that the The Dime Litigation Warrants are not deemed
class 12, he objects to the treatment of the LTW in the Seventh
Amended Plan. According to Mr. Menake, the Plan did not address
the board of director's breach of fiduciary obligation, and the
Plan includes a release of board from the failure of the board to
carry out the duty.
Full-text copies of the objections are available for free at:
http://bankrupt.com/misc/WASHINGTONMUTUAL_plan_obj.pdf
http://bankrupt.com/misc/WASHINGTONMUTUAL_plan_obj_b.pdf
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- was the 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. The Debtor tapped Valuation Research Corporation as
valuation service provider for certain assets.
Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New
York, and David B. Stratton, Esq., at Pepper Hamilton LLP in
Wilmington, Del., represent the Official Committee of Unsecured
Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and
William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the
Equity Committee. The official committee of equity security
holders also tapped BDO USA as its tax advisor. 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 the WaMu bank unit'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, upon which the Plan is premised, and the
transactions contemplated therein, are fair, reasonable, and in
the best interests of WMI. However, 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.
WaMu filed a Modified Sixth Amended Joint Plan and a related
Supplemental Disclosure Statement, which it believes would address
the Bankruptcy Court's concerns.
On Sept. 13, 2011, Judge Walrath denied confirmation of WaMu's
Modified Sixth Amended Plan and granted equity committee standing
to prosecute claims for equitable disallowance but stayed the
ruling pending mediation.
WaMu said it would seek confirmation of a revised plan "as soon as
practicable."
The Plan proposes to pay more than $7 billion to creditors and
incorporates a global settlement agreement resolving issues among
the Debtors, JPMorgan Chase, the Federal Deposit Insurance Corp.
in its corporate capacity and as receiver for WaMu Bank, certain
large creditors, certain WMB senior noteholders, and the
creditors' committee. The Settlement Noteholders are Appaloosa
Management, L.P., Aurelius Capital Management LP, Centerbridge
Partners, LP, and Owl Creek Asset Management, L.P.
WDS LLC: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: WDS, LLC
7023 E 12th Terrace
Kansas City, MO 64126
Bankruptcy Case No.: 12-40343
Chapter 11 Petition Date: January 31, 2012
Court: United States Bankruptcy Court
Western District of Missouri (Kansas City)
Judge: Arthur B. Federman
Debtor's Counsel: James C. Wirken, Esq.
THE LAW OFFICES OF JAMES C. WIRKEN
4740 Grand Ave., Suite 200
Kansas City, MO 64112
Tel: (816) 471-0330
Fax: (816) 471-3044
E-mail: mail@wirkenlaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Barrett Prelogar, member.
WEST END: Court Confirms Third Amended Plan of Liquidation
----------------------------------------------------------
On Jan. 25, 2012, the U.S. Bankruptcy Court for the Southern
District of New York confirmed the Third Amended Plan of
Liquidation of West End Financial Advisors LLC, filed on Jan. 25,
2012.
A copy of the Third Amended Plan of Liquidation is available for
free at http://bankrupt.com/misc/westend.doc310.pdf
As reported in the TCR on Dec. 28, 2011, the Plan seeks to
liquidate the Debtor in order to provide fair, equitable, and
reasonable treatment to all creditors of the Debtor. Under the
Plan all of the Debtor's assets will be transferred to a grantor
trust which will be administered by the Plan Administrator. The
Plan Administrator will collect the Debtor's income and monetize
its assets over the existence of the Post-Confirmation Estate and
pay creditors in accordance with the terms of the Plan.
The creditor distributions will be funded from the Plan
Administrator's cash on hand, the Budget Funds, monetization of
the Post-Confirmation Estate Assets, the Post-Confirmation
WEMFF/WEFIP Funds recoveries, if any, from the pursuit of alleged
preference and fraudulent conveyance claims and pursuit of other
claims held by the estate against third parties.
The Debtor projects that the Holders of Claims in Classes 1, 2 and
3 will be paid in full under the terms of the Plan. The Debtor is
unable to set forth with numerical specificity the estimated
distributions to Class 4 Claim Holders. The reasons for this is
the Debtors do not know at this point in time whether the Plan
Administrator will seek to sell the estate's interests in the Hard
Money Fund and the Franchise Fund prior to the maturity of the
loans contained in those portfolios, and if the Debtor's interests
are sold, what discount, if any, might be agreed to by the Plan
Administrator and the purchaser of the portfolio.
On the Effective Date, all outstanding Interests in the
Debtor (Class 5) will be canceled and deemed terminated and of no
force and effect and the Holders of Interests will not be entitled
to retain or receive any property on account of such Interest.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/WEST_END_ds_secondamended.pdf
About West End Financial
West End Financial Advisors LLC, Sentinel Investment Management
Corp. and a number of affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 11-11152) in Manhattan on March 15,
2011. New York-based West End estimated its assets and debts at
$1 million to $10 million. Arnold Mitchell Greene, Esq., at
Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as
the Debtors' bankruptcy counsel.
William Landberg created WEFA in 2000 as an investment and
financial management company. Subsequently he purchased Sentinel
Investment Management Corp., a boutique investment advisory
company. Sentinel and WEFA targeted individual private clients
for investments in fixed income funds and alternative investment
products. Mr. Landberg's ultimately resigned from all West End
related entities effective June 2, 2009, following a probe on
misappropriation of funds. Mr. Landberg pleaded guilty in
November to securities fraud. He agreed to forfeit $8.7 million
in assets.
West End filed under Chapter 11 in March shortly after the U.S.
District Court appointed a monitor at the behest of the Securities
and Exchange Commission. West End was accused by the SEC of
committing securities fraud and misusing client funds.
Schedules of assets and liabilities for West End and its
funds showed assets of $400,000 and debt of $6.7 million, not
including $66 million from investors who may or may not be
considered creditors. Debt includes $5.5 million in secured
claims, according to the schedules.
Secured creditors with the largest claims are DZ Bank ($118.1
million), West LB ($41 million), Iberia Bank ($11.3 million), and
Suffolk County National Bank ($8.3 million).
In July 2011 the bankruptcy judge ruled that West End should be
substantively consolidated with affiliates. West End Financial
filed a plan of liquidation in bankruptcy court in August.
WESTLAND CITY: Moody's Raises Revenue Debt Rating From 'Ba1'
------------------------------------------------------------
Moody's Investors Service has upgraded to Baa2 from Ba1 the City
of Westland's (MI) water and sewer system revenue debt.
Concurrently, Moody's has assigned a positive outlook. The city
has $2.9 million of revenue debt outstanding.
SUMMARY RATING RATIONALE
The bonds are secured by the system's net water and sewer
revenues. The upgrade to Baa2 reflects the system's improved
financial position due to the implementation of sizeable rate
increases that have brought the enterprise back into compliance
with its rate covenant. The upgrade also takes into consideration
the system's manageable debt ratio with a lack of borrowing plans,
and relatively stable residential customer base.
The positive outlook reflects Moody's expectation that the
financial position of the system will continue to improve over the
medium term due to management's intention to continue to increase
rates sufficiently to cover increased operating costs and pass
through costs from suppliers.
STRENGTHS
- Unlimited rating setting authority held at the local level
- Healthy debt service coverage reflected in fiscal 2011 and
projected for fiscal 2012
CHALLENGES
- Sizeable payable due to the General Fund
- Narrow cash reserves
WHAT COULD MOVE THE RATING UP
- Continued healthy debt service coverage levels
- Improved cash position
WHAT COULD MOVE THE RATING DOWN
- Inadequate debt service coverage
- Failure to implement timely and sufficient rate increases to
cover increasing operating costs
PRINCIPAL METHODOLOGY USED
The principal methodology used in this rating was Analytical
Framework For Water And Sewer System Ratings published in August
1999.
WOODBURY DEVELOPMENT: Case Summary & 6 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Woodbury Development, LLC
1241 42nd Street
Brooklyn, NY 11219
Bankruptcy Case No.: 12-40652
Chapter 11 Petition Date: January 31, 2012
Court: U.S. Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Jerome Feller
Debtor's Counsel: Mark A. Frankel, Esq.
BACKENROTH FRANKEL & KRINSKY LLP
489 Fifth Avenue, 28th Floor
New York, NY 10017
Tel: (212) 593-1100
Fax: (212) 644-0544
E-mail: mfrankel@bfklaw.com
Scheduled Assets: $14,000,000
Scheduled Liabilities: $7,415,272
The petition was signed by Deborah Harfanes, president.
Debtor's List of Its Six Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Commissioner of Finance Lots $104,141
County of Orange, Gov. Center
265 Main Street
Goshen, NY 10924-1698
TRC Engineers, Inc. -- $89,000
7 Skyline Drive
Hawthorne, NY 10532
Commissioner of Finance Lots $6,973
County of Orange, Gov. Center
265 Main Street
Goshen, NY 10924-1698
Commissioner of Finance Lots $5,646
Ostrer & Hoovler PC -- $5,000
Commissioner of Finance Lots $4,777
ZOGENIX INC: To Sell $75 Million of Securities
----------------------------------------------
Zogenix, Inc., filed with the U.S. Securities and Exchange
Commission a Form S-3 registration statement relating to the
Company's offer to sell any combination of debt securities,
preferred stock, common stock, debt warrants and equity warrants,
either individually or in units, in one or more offerings. The
aggregate initial offering price of all securities sold under this
prospectus will not exceed $75,000,000.
Each time the Company sells securities, the Company will provide
specific terms of the securities offered in a supplement to this
prospectus. The prospectus supplement may also add, update or
change information contained in this prospectus.
The Company will sell these securities directly to its
stockholders or to purchasers or through agents on its behalf or
through underwriters or dealers as designated from time to time.
If any agents or underwriters are involved in the sale of any of
these securities, the applicable prospectus supplement will
provide the names of the agents or underwriters and any applicable
fees, commissions or discounts.
The Company's common stock is traded on the Nasdaq Global Market
under the symbol "ZGNX." On Feb. 2, 2012, the closing price of
the Company's common stock was $2.74.
A full-text copy of the prospectus is available for free at:
http://is.gd/FGEzzc
About Zogenix Inc.
Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and
Emeryville, California, is a pharmaceutical company
commercializing and developing products for the treatment of
central nervous system disorders and pain.
As reported in the TCR on March 8, 2011, Ernst & Young LLP, in San
Diego, Calif., expressed substantial doubt about Zogenix's ability
to continue as a going concern, following the Company's 2010
results. The independent auditors noted that of the Company's
recurring losses from operations and lack of sufficient working
capital.
The Company also reported a net loss of $60.19 million on
$29.67 million of total revenue for the nine months ended Sept.
30, 2011, compared with a net loss of $71.42 million on $14.63
million of total revenue for the same period during the prior
year.
The Company's balance sheet at Sept. 30, 2011, showed
$116.88 million in total assets, $86.71 million in total
liabilities and $30.16 million in total stockholders' equity.
ZOO ENTERTAINMENT: MMB to Provide Additional $175,000 Financing
---------------------------------------------------------------
Zoo Publishing, Inc., a wholly-owned subsidiary of Zoo
Entertainment, Inc., entered into the Second Amendment to Second
Amended and Restated Factoring and Security Agreement with Panta
Distribution, LLC, and MMB Holdings LLC, pursuant to which the
parties agreed to amend that certain Second Amended and Restated
Factoring and Security Agreement dated as of Oct. 28, 2011, by and
between Zoo Publishing, Panta and MMB.
Pursuant to the Factoring Agreement Amendment, MMB agreed to
provide $175,000 in additional funding to Zoo Publishing under the
Factoring Agreement. The Additional Funding will bear interest at
the lesser of a rate of 15% per annum, or the maximum rate
permitted by law.
MMB is owned by David E. Smith, a former director of the Company,
and Jay A. Wolf, Executive Chairman of the Board of Directors of
the Company. Each of Mr. Smith and Mr. Wolf is a member, equity
owner, and officer or manager, as the case may be, of MMB, and Mr.
Smith is the managing member of Mojobear Capital, the managing
member of MMB.
About Zoo Entertainment
Cincinnati, Ohio-based Zoo Entertainment, Inc. (NASDAQ CM: ZOOG)
is a developer, publisher and distributor of interactive
entertainment for Internet-connected consoles, handheld gaming
devices, PCs, and mobile devices.
The Company reported a net loss of $19.74 million on $8.59 million
of revenue for the nine months ended Sept. 30, 2011, compared with
a net loss of $837,000 on $43.71 million of revenue for the same
period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $6.19
million in total assets, $13.03 million in total liabilities and a
$6.84 million total stockholders' deficit.
As reported in the TCR on Apr 26, 2011, EisnerAmper LLP, in
Edison, N.J., expressed substantial doubt about Zoo
Entertainment's ability to continue as a going concern, following
the Company's 2010 results. The independent auditors noted that
the Company has both incurred losses and experienced net cash
outflows from operations since inception.
ZOO ENTERTAINMENT: David Smith Discloses 26.5% Equity Stake
-----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, David E. Smith and his affiliates disclosed
that, as of Jan. 30, 2012, they beneficially own 2,216,290 shares
of common stock of Zoo Entertainment, Inc., representing 26.5% of
the shares outstanding. The percentage is based on a total of
8,011,435 shares of common stock outstanding as of Nov. 14, 2011,
as reported in the Company's 10-Q filed with the Securities and
Exchange Commission on Nov. 21, 2011. A full-text copy of the
amended 13D is available for free at http://is.gd/94cbqN
About Zoo Entertainment
Cincinnati, Ohio-based Zoo Entertainment, Inc. (NASDAQ CM: ZOOG)
is a developer, publisher and distributor of interactive
entertainment for Internet-connected consoles, handheld gaming
devices, PCs, and mobile devices.
The Company reported a net loss of $19.74 million on $8.59 million
of revenue for the nine months ended Sept. 30, 2011, compared with
a net loss of $837,000 on $43.71 million of revenue for the same
period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $6.19
million in total assets, $13.03 million in total liabilities and a
$6.84 million total stockholders' deficit.
As reported in the TCR on Apr 26, 2011, EisnerAmper LLP, in
Edison, N.J., expressed substantial doubt about Zoo
Entertainment's ability to continue as a going concern, following
the Company's 2010 results. The independent auditors noted that
the Company has both incurred losses and experienced net cash
outflows from operations since inception.
* Lack of Original Mortgage Note Defeats Foreclosure
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in Denver ruled on Feb. 1
that a mortgage lender that didn't produce the original note
endorsed in blank shouldn't have been permitted by the bankruptcy
court to foreclose. The case, which involved a couple who filed
Chapter 13 to halt foreclosure, is Miller v. Deutsche Bank
National Trust Co. (In re Miller), 11-1232, U.S. Court of Appeals
for the 10th Circuit (Denver).
* Circuit Lays Down Rules to Avoid Arbitration Clauses
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in San Francisco ruled on
Jan. 30 in the reorganization of Thorpe Insulation Co. that
bankruptcy courts have discretion to refuse to enforce arbitration
clauses in contracts in both core and non-core disputes.
Mr. Rochelle recounts that the case involved a pre-bankruptcy
settlement between Thorpe and an insurance company that provided
coverage for asbestos claims. After bankruptcy, the insurance
company contended that the proposed reorganization plan and pre-
bankruptcy negotiations both violated the settlement agreement.
In the bankruptcy and district courts, the insurance company
unsuccessfully sought to enforce the arbitration clause with
regard to claims about violation of the settlement agreement.
According to the report, Circuit Judge Ronald M. Gould, writing a
28-page opinion for the three-judge panel, upheld the refusal to
enforce the arbitration clause, despite the strong federal policy
of enforcing arbitration clauses in non-bankruptcy settings. In
deciding whether to bypass arbitration, Gould said the distinction
between core and non-core proceedings isn't dispositive. Even in
a core proceeding, the dispute may be decided in bankruptcy court
"only if arbitration would conflict with the underlying purposes
of the Bankruptcy Code."
The case is Continental Insurance Co. v. Official Creditors'
Committee of Thorpe Insulation Co. (In re Thorpe Insulation Co.),
10-55744, 9th U.S. Circuit Court of Appeals (San Francisco).
About Thorpe Insulation
Based in Long Beach, California, Thorpe Insulation Company
supplied and distributed asbestos thermal insulation in Southern
California before about 1972. The company's products included
pipe and boiler insulation, asbestos cloth and insulating mud.
After 1972, some of Thorpe's operations also involved asbestos and
lead abatement, including repairing insulation that contained
asbestos at commercial and industrial sites.
On or about Dec. 17, 2004, Thorpe's lender, Pacific Funding Group
LLC, sold its collateral at a foreclosure sale to Farwest
Insulation Consulting owned by Eric and David Fults. Following
the foreclosure, Thorpe ceased operation of its business. To
date, Thorpe has been subjected to about 12,000 claims and
lawsuits related to asbestos.
Thorpe filed for chapter 11 protection on Oct. 15, 2007 (Bankr.
C.D. Calif. Case No. 07-19271). Jeremy V. Richards, Esq., and
Scotta E. McFarland, Esq., at Pachulski, Stang, Ziehl & Jones,
LLP, represent the Debtor.
Los Angeles-based Pacific Insulation Company was incorporated in
California by Thorpe on May 23, 2000, to be its wholly owned
subsidiary. On Oct. 1, 2000, Pacific transferred 100% of its
shares to Thorpe in exchange for Thorpe's materials division
assets. Thorpe's sole shareholders and board members, Robert W.
Fults and Linda Fults, own 50.1% and 49.9% of Pacific,
respectively. Pacific is a southwest commercial and industrial
insulation distributor and fabricator with locations in Southern
and Northern California, Arizona, and Nevada. It provides pipe,
air handling, fire barrier, board and blanket insulation as well
as adhesives, mastics and sealants. Pacific has never installed
or sold any materials containing asbestos. It currently has 55
full-time employees.
Pacific filed for chapter 11 petition on Oct. 31, 2007 (Bankr.
C.D. Calif. Case No. 07-20016) due to its alleged asbestos
liability and the failure of Thorpe's insurers to pay asbestos
claims asserted against Thorpe. John A. Lapinski, Esq., Leslie R.
Horowitz, Esq., and Stephen R. Hyam, Esq., at Clark & Trevithick
represent Pacific in its restructuring efforts.
On Nov. 6, 2007, Pacific's case was jointly administered under
Thorpe Insulation's bankruptcy proceeding.
Caplin & Drysdale, Chartered and Heller Ehrman LLP are co-counsels
to the Official Committee of Unsecured Creditors.
The Debtor's schedules showed $6,499,167 in total assets, and
$52,438,167 in total liabilities.
* Court to IRS: Wrong Defendant for Sovereign Immunity
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that although the U.S. government may have had a
legitimate complaint, the Justice Department sued Chapter 13
trustees when the lawsuit should have been against bankruptcy
judges, the U.S. Court of Appeals in Cincinnati ruled on Jan. 30.
The opinion faulted the government for using an "unusual mechanism
to obtain an extraordinary remedy to avoid an ordinary appeal."
The case is U.S. v. Carroll, 10-1400, 6th U.S. Circuit Court of
Appeals (Cincinnati).
* Control More Important Than Ownership for Fraud Suit
------------------------------------------------------
The U.S. Court of Appeals in New Orleans ruled late January that
legal ownership of an account isn't a prerequisite for a
successful lawsuit based on a fraudulent transfer from the
account. The case involved a group of related companies that
weren't an "ethically sound enterprise," Circuit Judge Emilio M.
Garza said in his opinion on Jan. 27. Judge Garza upheld a $3
million fraudulent transfer judgment obtained by the bankruptcy
trustee. The judge said it hadn't previously been decided under
Texas law whether legal ownership is a necessary condition for a
fraudulent transfer suit. He concluded that showing "control is
more decisive than ownership" where evidence of fraud is "strong."
The case is Stettner v. Smith (In re IFS Financial Corp.), 5th
U.S. Circuit Court of Appeals (New Orleans).
* Bankruptcy Court Jury Trial May Violate Seventh Amendment
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that U.S. District Judge Paul A. Engelmayer in New York
said in a Feb. 1 opinion that holding a jury trial on consent in
bankruptcy court with regard to a non-core issue would violate the
Reexamination Clause of the Seventh Amendment to the U.S.
Constitution. The case, which involved a lawsuit in bankruptcy
court where the plaintiff and defendant at one time consented to
holding a jury trial in front of the bankruptcy judge, is Geron v.
Levine (In re Levine), 11-9101, U.S. District Court, Southern
District of New York (Manhattan). Judge Engelmayer said that a
jury trial in bankruptcy court on noncore issues would violate the
Seventh Amendment strictures on setting aside jury verdicts.
* New York District Court Rules to Clarify Bankruptcy Judges' Role
------------------------------------------------------------------
Dow Jones' DBR Small Cap reports that the chief judge of the U.S.
District Court for the Southern District of New York issued an
order seeking to clarify bankruptcy judges' power in the wake of a
recent Supreme Court ruling.
* Geithner: Goal Of Dodd-Frank Isn't to Eliminate Failure
---------------------------------------------------------
Dow Jones' Daily Bankruptcy Review reports that the goal of the
2010 Dodd-Frank financial law isn't to wipe failure from the face
of the U.S. financial system, Treasury Secretary Timothy Geithner
said Thursday at a rare press conference.
* Cecelia Morris Is New Chief New York Bankruptcy Judge
-------------------------------------------------------
Cecelia G. Morris, a U.S. Bankruptcy Judge in Poughkeepsie, New
York, will become chief bankruptcy judge for the Southern District
of New York on March 1, upon the retirement of U.S. Bankruptcy
Judge Arthur J. Gonzalez. Before ascending to the bench, Judge
Morris had been the clerk of the New York bankruptcy court since
1988. Judge Morris received her legal education from the John
Marshall Law School. In addition to being a clerk for a
bankruptcy judge and practicing in a private law firm, Judge
Morris was an assistant district attorney in Griffin, Georgia.
Judge Morris is presiding over the bankruptcy reorganization of
five subsidiaries of power producer Dynegy Inc.
* Banks Push for More Transparency in Credit Default Swaps
----------------------------------------------------------
Dow Jones' Daily Bankruptcy Review reports that a push by Wall
Street banks to devise a more-transparent way to make bets on bond
defaults has stalled amid uncertainty over new regulations and
difficulties devising the product.
* Without Timber Money, Oregon Budgets Face Buzzsaw
---------------------------------------------------
Dow Jones' DBR Small Cap reports that with this year's expiration
of a federal program designed to compensate Oregonians for
declining timber sales, counties statewide are losing an allotment
that has totaled $2.6 billion since 2000.
* Edwards Wildman Adds Bankruptcy Partner to NY Office
------------------------------------------------------
The international law firm of Edwards Wildman Palmer LLP announced
that Steven B. Smith has joined the firm as a partner in its
Restructuring & Insolvency Department. Mr. Smith will base his
practice in the firm?s office in New York.
Mr. Smith represents clients throughout the US in complex
corporate restructuring and creditors? right issues, with a
particular focus on Chapter 11 matters. He advises creditor
committees, secured lenders, administrative agents, indenture
trustees, individual bondholders, and asset and claims purchasers.
He also counsels tort and trade claimants in restructuring related
matters.
"Steven is an outstanding addition to our bankruptcy practice
group," said David J. Fischer, a Chicago partner who serves as the
head of Edwards Wildman?s Restructuring & Insolvency Department.
"Our clients in New York and throughout the country will benefit
from his substantial experience in complex bankruptcy and
restructuring matters, and we are delighted to welcome him to the
firm."
Previously a counsel at Dechert LLP, Smith is admitted to practice
in New York and New Jersey, as well as numerous courts. He earned
his undergraduate degree from the Yeshiva University and his law
degree from Brooklyn Law School.
The Edwards Wildman Restructuring & Insolvency Department has
broad experience in bankruptcy cases, out-of-court restructurings,
cross-border proceedings and other distressed situations. The firm
regularly advises premier financial institutions, institutional
investors, debt investors, finance companies, insurers and
sureties to enforce creditors? rights and to achieve strategic
goals in the context of structured transactions, commercial
litigation, loan workout, debt restructurings and bankruptcy.
* CME Group to Rebuild Farmers' Trust With $100MM Insurance Fund
---------------------------------------------------------------
Dow Jones' Daily Bankruptcy Review reports that CME Group Inc.
launched a fresh effort to rebuild market confidence damaged by
the collapse of MF Global Holdings Ltd., creating a $100 million
insurance fund to protect farmers and ranchers.
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 120.2 (9.2) 2.7
ACCO BRANDS CORP ABD US 1,050.3 (32.6) 298.7
AMC NETWORKS-A AMCX US 2,121.5 (1,065.5) 519.5
AMER AXLE & MFG AXL US 2,328.7 (419.6) 187.0
AMERISTAR CASINO ASCA US 2,039.6 (105.7) (50.8)
ANGIE'S LIST INC ANGI US 32.6 (38.9) (25.9)
ANOORAQ RESOURCE ARQ SJ 927.7 (148.7) 29.2
ARRAY BIOPHARMA ARRY US 82.2 (127.2) (15.1)
AUTOZONE INC AZO US 5,932.6 (1,347.1) (736.3)
BLUEKNIGHT ENERG BKEP US 320.8 (12.5) (69.9)
BLUESKY SYSTEMS BSKS US 0.1 (0.2) -
BOSTON PIZZA R-U BPF-U CN 146.9 (105.3) (2.0)
CABLEVISION SY-A CVC US 6,740.1 (5,525.9) (886.1)
CADIZ INC CDZI US 49.3 (4.7) 2.5
CANADIAN SATEL-A XSR CN 174.4 (29.8) (55.9)
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CC MEDIA-A CCMO US 16,508.9 (7,456.0) 1,531.3
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CENVEO INC CVO US 1,407.1 (331.1) 222.9
CHENIERE ENERGY CQP US 1,803.0 (524.1) 67.7
CHENIERE ENERGY LNG US 2,651.4 (446.9) (282.7)
CHOICE HOTELS CHH US 467.9 (14.4) 28.0
CINCINNATI BELL CBB US 2,683.8 (626.1) 22.7
CLOROX CO CLX US 4,290.0 (199.0) (289.0)
CLOVIS ONCOLOGY CLVS US 26.4 (18.1) (19.2)
CROWN HOLDINGS I CCK US 6,868.0 (239.0) 318.0
DEAN FOODS CO DF US 5,911.2 (58.1) 327.7
DENNY'S CORP DENN US 280.6 (95.5) (40.1)
DIGITAL DOMAIN M DDMG US 178.9 (85.7) (38.3)
DIRECTV-A DTV US 18,232.0 (2,471.0) 103.0
DOMINO'S PIZZA DPZ US 438.2 (1,221.0) 118.2
DUN & BRADSTREET DNB US 1,775.6 (558.0) (478.3)
FNB UNITED CORP FNBN US 1,643.9 (129.9) -
FREESCALE SEMICO FSL US 3,415.0 (4,480.0) 1,432.0
GENCORP INC GY US 994.2 (143.4) 102.2
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
GROUPON INC GRPN US 795.6 (15.6) (301.0)
HANDY & HARMAN L HNH US 380.4 (0.9) 39.2
HCA HOLDINGS INC HCA US 26,898.0 (7,014.0) 1,679.0
HUGHES TELEMATIC HUTC US 94.0 (111.8) (39.0)
HUGHES TELEMATIC HUTCU US 94.0 (111.8) (39.0)
IDENIX PHARM IDIX US 88.8 (2.3) 54.6
IMPERVA INC IMPV US 42.5 (6.6) (5.8)
INCYTE CORP INCY US 371.2 (181.0) 225.5
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 137.5 (34.8) (7.5)
JUST ENERGY GROU JE US 1,584.2 (242.2) (215.6)
JUST ENERGY GROU JE CN 1,584.2 (242.2) (215.6)
KV PHARM-B KV/B US 348.8 (410.9) (15.3)
LEVEL 3 COMM INC LVLT US 9,254.0 (523.0) 1,058.0
LIN TV CORP-CL A TVL US 815.8 (115.0) 56.6
LIZ CLAIBORNE LIZ US 1,144.0 (420.0) (97.3)
LORILLARD INC LO US 3,152.0 (1,174.0) 1,299.0
MAINSTREET EQUIT MEQ CN 477.7 (11.1) -
MANNING & NAPIER MN US 66.1 (184.6) -
MEAD JOHNSON MJN US 2,766.8 (168.0) 689.6
MEDIVATION INC MDVN US 188.3 (3.9) 89.4
MERITOR INC MTOR US 2,553.0 (983.0) 180.0
MONEYGRAM INTERN MGI US 5,175.6 (110.2) (40.4)
MOODY'S CORP MCO US 2,521.3 (174.2) 525.1
MORGANS HOTEL GR MHGC US 480.8 (77.2) (4.1)
NATIONAL CINEMED NCMI US 807.9 (346.2) 56.6
NEXSTAR BROADC-A NXST US 582.7 (187.0) 26.2
NPS PHARM INC NPSP US 237.4 (38.6) 183.5
NYMOX PHARMACEUT NYMX US 6.5 (5.5) 3.3
ODYSSEY MARINE OMEX US 25.8 (0.7) (4.1)
OTELCO INC-IDS OTT-U CN 316.1 (10.1) 22.9
OTELCO INC-IDS OTT US 316.1 (10.1) 22.9
PALM INC PALM US 1,007.2 (6.2) 141.7
PDL BIOPHARMA IN PDLI US 270.5 (243.2) 44.6
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PRIMEDIA INC PRM US 208.0 (91.7) 3.6
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 304.3 (105.9) 44.1
QWEST COMMUNICAT Q US 16,849.0 (1,560.0) (2,828.0)
REGAL ENTERTAI-A RGC US 2,262.0 (555.7) (25.8)
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTECH NITROGEN RNF US 152.4 (76.1) (32.3)
REVLON INC-A REV US 1,081.7 (685.1) 148.6
RSC HOLDINGS INC RRR US 3,141.0 (38.4) (1.0)
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,792.7 (168.5) 482.3
SINCLAIR BROAD-A SBGI US 1,563.8 (125.4) 45.7
SINCLAIR BROAD-A SBTA GR 1,563.8 (125.4) 45.7
SMART TECHNOL-A SMT US 529.8 (7.1) 183.9
SMART TECHNOL-A SMA CN 529.8 (7.1) 183.9
SUN COMMUNITIES SUI US 1,328.6 (72.4) -
SYNERGY PHARMACE SGYP US 2.1 (8.6) (6.1)
TAUBMAN CENTERS TCO US 2,518.2 (467.9) -
THERAVANCE THRX US 283.3 (59.2) 229.4
TOWN SPORTS INTE CLUB US 445.1 (3.2) (30.8)
UNISYS CORP UIS US 2,612.2 (1,311.0) 487.3
VECTOR GROUP LTD VGR US 931.0 (66.7) 252.6
VERISIGN INC VRSN US 1,856.2 (88.1) 788.9
VERISK ANALYTI-A VRSK US 1,379.9 (158.9) (234.2)
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
WARNER MUSIC GRO WMG US 3,583.0 (289.0) (630.0)
WEIGHT WATCHERS WTW US 1,086.5 (470.5) (292.3)
WESTMORELAND COA WLB US 769.0 (174.4) (5.9)
*********
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, 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 2012. 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 ***