/raid1/www/Hosts/bankrupt/TCR_Public/120808.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, August 8, 2012, Vol. 16, No. 219
Headlines
1617 WESTCLIFF: Case Summary & 20 Largest Unsecured Creditors
44 CP I LOAN: Sec. 341 Creditors' Meeting Set for Aug. 14
501 GRANT STREET: Owner of Union Trust Building in Chapter 11
5712 N. 67TH AVE: Files for Chapter 11 in Phoenix
5712 N. 67TH AVE: Voluntary Chapter 11 Case Summary
ACCREDITED MEMBERS: Daimiel Global Discloses 25.5% Equity Stake
ADVANCED MICRO: Fitch Rates Senior Notes Due 2022 at 'B+/RR3'
ADVANCED MICRO: Moody's Rates New $300MM Sr. Unsecured Debt 'Ba3'
ADVANCED MICRO: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Neg
AES EASTERN: Plan Exclusivity Hearing Today
AHERN RENTALS: Court OKs GA Keen as Real Estate Advisor
AMPAL-AMERICAN ISRAEL: Had $284.3 Million Loss in First Quarter
AVENTINE RENEWABLE: Moody's Lowers CFR/PDR to 'Ca'
BANKATLANTIC BANCORP: BB&T Buys Bank; Now Known as BBX Capital
BAOSHINN CORPORATION: Had $50,200 Net Loss in First Quarter
BEAZER HOMES: Incurs $39.8 Million Net Loss in Fiscal 3rd Quarter
BERNARD L. MADOFF: Claims Immunity From State Lawsuits
BERNARD L. MADOFF: Customers Ask Dist. Judge to Rule on 2nd Payout
BEST BUY: Fitch Places 'BB+' IDR on Rating Watch Negative
BEST BUY: S&P Cuts Corp. Credit Rating to 'BB+' After Buyout Offer
BION ENVIRONMENTAL: Extends Maturity of CEO Deferred Compensation
BITI LLC: Case Summary & 20 Largest Unsecured Creditors
BLAST ENERGY: Completes Merger Transaction with PEDCO
BNC FRANCES: Amends Schedules of Assets and Liabilities
BUTTERMILK TOWNE CENTER: To Distribute Remaining Carve-Out
CAMBRIDGE HEART: Issues $267,500 Convertible Promissory Notes
CARRIAGE SERVICES: Credit Facility No Impact on Moody's 'B2' CFR
CATALYST PAPER: Lowers Net Loss to $11.7-Mil. in Second Quarter
CBS I LLC: Sec. 341 Creditors' Meeting Set for Aug. 9
CHEMTURA CORP: Rises Most Since Bankruptcy With Pesticides Boost
CIRCLE ENTERTAINMENT: Files Form 10-Q; Incurs $2.2MM Loss in Q2
CIRCUS AND ELDORADO: Downey Brand OK'd as Nevada Counsel
CIRCUS AND ELDORADO: Sept. 13 Hearing on Plan Confirmation
CLARE AT WATER TOWER: Bondholders Get 17 Cents on Dollar
COCOPAH NURSERIES: Sec. 341 Creditors' Meeting This Friday
COMARCO INC: Neal Bradsher Discloses 35.1% Equity Stake
COMDISCO HOLDING: Has $629,000 Net Loss in June 30 Quarter
COMMERCIAL FINANCIAL: Files for Chapter 11 Bankruptcy Protection
CONSTELLATION BRANDS: Moody's Rates $650Mm Notes Offering 'Ba1'
CONSTELLATION BRANDS: S&P Rates New $650MM Sr. Unsec. Notes 'BB+'
CONTRACT RESEARCH: Has Until Nov. 21 to Propose Ch. 11 Plan
DAYTOP VILLAGE: Court Sets Sept. 4 as Claims Bar Date
DBSI INC: Judge Nixes Bid to Name Trustee in Racketeering Case
DCB FINANCIAL: Posts $283,00 Net Income in Second Quarter
DELTA PETROLEUM: FTI Approved as Committee's Advisor
DEMCO INC: NY Demolition Services Provider in Chapter 11
DEMCO INC.: Case Summary & 20 Largest Unsecured Creditors
DEWEY & LEBOEUF: Files Schedules of Assets and Liabilities
DEWEY & LEBOEUF: Six Members of Committee of Former Partners
DEWEY & LEBOEUF: Court Fixes Sept. 7 as Claims Bar Date
DEWEY & LEBOEUF: Deloitte FAS OK'd as Panel's Financial Advisor
DEWEY & LEBOEUF: Court OKs Sitrick as Communications Consultant
DYNEGY INC: Posts $1.06 Billion Net Loss in Second Quarter
EASTMAN KODAK: Gets Court OK to Pay $6MM in Performance Bonuses
EASTMAN KODAK: Incurs $299 Million Net Loss in Second Quarter
EMMIS COMMUNICATIONS: To Keep $4-Mil. of Stations Sale Proceeds
ENTERPRISE PRODUCTS: Fitch Puts Rating on Jr. Subordinated at BB+
FIRST DATA: To Offer $750 Million Senior Secured Notes
FORT LAUDERDALE BOATCLUB: Case Summary & Largest Unsec. Creditors
FRESH START: Had $18,800 Net Loss in First Quarter
FRESNO, CA: Has Fiscal Resemblance to Bankrupt Neighbors
FRIENDFINDER NETWORKS: Had $21.5-Mil. Net Loss in First Quarter
FRIENDSHIP DAIRIES: Files for Chapter 11 in Texas
FRIENDSHIP DAIRIES: Voluntary Chapter 11 Case Summary
FUSION TELECOMMUNICATIONS: Amends LOI with Two Private Funds
GAMETECH INTERNATIONAL: Sec. 341 Creditors' Meeting Tomorrow
GATEHOUSE MEDIA: Incurs $2.86-Mil. Net Loss in Second Quarter
GENTA INC: Files for Chapter 7 Bankruptcy to Liquidate
GLOBAL AVIATION: OK'd to Expand Ernst& Young Services
GRAY TELEVISION: Reports $10.99-Mil. Profit in 2nd Quarter
H&E EQUIPMENT: Moody's Rates $480-Mil. Sr. Unsecured Notes 'B3'
H&E EQUIPMENT: S&P Affirms 'BB-' Corporate Credit Rating
HALIFAX GROUP: Brooklyn Properties Owner Files for Chapter 11
HALIFAX GROUP: Case Summary & 5 Largest Unsecured Creditors
HOST HOTELS: Fitch Rates 4.75% Series C Senior Notes 'BB'
HD SUPPLY: Issues $300 Million Additional 8.125% Senior Notes
HOSTESS BRANDS: Pension Funds Oppose Payment Delays
HRK HOLDINGS: Taps Kynes Markman as Environmental Counsel
INDEPENDENCE TAX III: Reports $6.7MM Net Income in March 31 Qtr.
INDEPENDENCE TAX: Swings to $14.8 Million Net Income Fiscal Q1
INFUSYSTEM HOLDINGS: Conference Call for Q2 Results Today
JENNE HILL: Aug. 16 Hearing on Valuation of Wells Fargo Collateral
JEANNE BUSSARD CENTER: Maryland Seeks Receiver, Plans Reopening
K-V PHARMACEUTICAL: To Transition Shares Trading to OTC Markets
LDK SOLAR: Director Rongqiang Cui Dies at 71
LIKE OAK DEVELOPMENT: Files for Chapter 11 in Houston
LIQUIDMETAL TECHNOLOGIES: Amends 79.2-Mil. Common Shares Offering
LIVE OAK: Case Summary & 20 Largest Unsecured Creditors
LSP ENERGY: Stalking Horse Denied; Auction Reopened
MANHATTAN BRIDGE: Receives 180 Days Delisting Notice From NASDAQ
MARKWEST ENERGY: Fitch Rates New $500MM Sr. Unsecured Notes 'BB'
MARKWEST ENERGY: Moody's Rates New $500MM Sr. Unsec. Notes 'Ba3'
MARKWEST ENERGY: S&P Rates New $500M Sr. Unsecured Notes 'BB'
MAUI LAND: Files Form 10-Q, Incurs $1-Mil. Net Loss in Q2
MBS MANAGEMENT: Can't Recoup $156K Bills to MXEnergy
MEDIA GENERAL: Files Form 10-Q, Incurs $146.3MM Net Loss in Q2
MERCATOR MINERALS: Had $20.5 Million Net Loss in 1st Quarter
MF GLOBAL: Trustees Disagree Over Amount to Return to Customers
MMODAL INC: S&P Gives 'B+' Corporate Credit Rating; Outlook Stable
MMRGLOBAL INC: Can Borrow up to $4.5MM Under Amended RHL Note
MOHEGAN TRIBAL: Reports $9-Mil. Net Income in Fiscal 3rd Quarter
MORGANS HOTEL: Files Form 10-Q; Incurs $16.1-Mil. Net Loss in Q2
MORGAN'S FOODS: J. Pappas May Own Up to 27% of Common Shares
MOUNTAIN COUNTRY: Sec. 341 Meeting of Creditors on Aug. 13
MOUNTAIN COUNTRY: Has Okay to Hire James W. Lane, Jr. as Attorney
MOUNTAIN COUNTRY: Files List of Largest Unsecured Creditors
MOUNTAIN COUNTRY: Robert Johns Okayed as Chapter 11 Trustee
MSR RESORT: Big Question Mark Remains in Long-Awaited Plan
NAKNEK ELECTRIC: Hearing Friday on Plan Disclosures
NATIONAL BEDDING: Mood's Says Advent Acquisition Credit Positive
NAVISTAR INT'L: Fitch Junks Rating on Senior Unsecured Debt
NIELSEN HOLDINGS: Moody's Changes Outlook on 'Ba3' CFR to Pos.
NORTEL NETWORKS: Files Benefits Termination Motions
NORTH END UNITED HOUSING: Gets Reprieve From Receivership
NPS PHARMACEUTICALS: Reports $7.3 Million Net Income in Q2
NUANCE COMMS: Moody's Rates Proposed Sr. Unsecured Notes 'Ba3'
OCEAN BREEZE: Case Summary & 5 Largest Unsecured Creditors
OJSC HC: Files Suit Against Former Execs for Sibirsky Debt
ORAGENICS INC: To Raise $12.8MM in Private Placement Financing
OMNICOMM SYSTEMS: Files Form 10-Q; Reports $1.5MM Income in Q2
OPTIONS MEDIA: Alpha Capital Discloses 9.9% Equity Stake
OTOLOGICS LLC: Receives Court Approval of Auction Rules
OXLEY DEVELOPMENT: Returns to Chapter 11, This Time in Atlanta
OXLEY DEVELOPMENT: Case Summary & 11 Largest Unsecured Creditors
PACIFIC THOMAS: Files for Chapter 11 in Oakland
PACIFIC THOMAS: Case Summary & 20 Largest Unsecured Creditors
PATRIOT COAL: Court Approves $802-Mil. DIP Financing
PATRIOT COAL: Unsecured Creditors Committee Has Seven Members
PATRIOT COAL: Proposes Garden City Group as Admin. Agent
PEMCO WORLD: Has New Sale Deal With Sun Capital Affiliate
PEREGRINE FINANCIAL: U.S. Bank Named as Defendant
PHILADELPHIA NEWSPAPERS: $1.8-Mil. Claim Won't Upset Plan
PICHI'S INC: Court Grants Dismissal of Chapter 11 Case
PINNACLE AIRLINES: Shareholders Seek to Right to Sue Delta
PLATINUM PROPERTIES: Wants Until Oct. 25 to File Chapter 11 Plan
PMI GROUP: CFO Resigns, Moves to California Company
POINT BLANK: Court Approves Settlement Deal
PORTER BANCORP: Files Form 10-Q, Incurs $319,000 Net Loss in Q2
POSITIVEID CORPORATION: Has $2.3 Million Net Loss in 1st Quarter
PRECISION OPTICS: To Eliminate Former CEO's Life Insurance
PROBE MANUFACTURING: Had $12,700 Net Income in 1st Quarter
RESIDENTIAL CAPITAL: Citibank Objects to Gilberts' Dismissal Plea
RESIDENTIAL CAPITAL: Creditors Seek Stay Relief to Pursue Lawsuits
RESIDENTIAL CAPITAL: Files Amended Schedules of Assets & Debts
RESIDENTIAL CAPITAL: Creditor Objects to Bradley Hiring
RG STEEL: Plants Fetch $25.15 Million at Auction
ROOMSTORE INC: Court OKs Lucy L. Thomson as Privacy Ombudsman
ROOMSTORE INC: Taps Binswanger Southern as Real Estate Broker
SAAB CARS: Spyker Seeks $3 Billion From General Motors
SAAB CARS: PricewaterhouseCoopers LLP OK'd as Tax Accountants
SAAB CARS: Creditors Have Until Sept. 14 to File Proofs of Claim
SABRE HOLDINGS: S&P Rates New $250-Mil. Term Loan at 'B'
SABRE INC: Moody's Rates $250-Mil. First Lien Term Loan 'B1'
SAND TECHNOLOGY: Incurs C$1.3MM Net Loss in Q3 Fiscal 2012
SANDRIDGE ENERGY: Moody's Upgrades CFR to 'B1'; Outlook Stable
SANDRIDGE ENERGY: S&P Rates New $500-Mil. Note Offering 'B'
SANUWAVE HEALTH: Had $1.8 Million Net Loss in First Quarter
SHENGDATECH INC: Aug. 30 Hearing on More Plan Exclusivity
SHOE MANIA: Creditors Seek to Force Retailer into Chapter 7
SINCLAIR BROADCAST: Reports $30.1 Million Net Income in Q2
SKINNER ENGINE: Plan May Be Nixed Before Confirmation Hearing
SOLYNDRA LLC: GOP Report Slams White House Over $535MM Loan
SPRING NEXTEL: Fitch Affirms Low-B IDR; Outlook Negative
STAR TRIBUNE: Wayzata Takes Majority Stake
STOCKTON, CA: Insurer Objects to $100MM Writedown Request
SYMS CORP: Fla. Property Auction Scheduled for Aug. 14
TRAFFIC CONTROL: Creditor's Panel Can Tap GlassRatner as Advisor
TUCSON & PIMA: Moody's Reviews 'Ba3' Bond Rating for Downgrade
US AIRWAYS: S&P Corrects Rating on 2001-1 Class G Certs. to 'BB'
USEC INC: Files Form 10-Q; Incurs $92-Mil. Loss in Second Quarter
VANITY EVENTS: Hires Sadore to Provide Advisory Services
VANN'S INC: Files for Bankruptcy, Won't Close Stores
VANN'S INC.: Case Summary & 20 Largest Unsecured Creditors
VELO HOLDINGS: OK'd to Pick Stalking Horse Bidders for Asset Sale
VENTANA 20/20: Voluntary Chapter 11 Case Summary
VILLAGIO PARTNERS: 7 Marcel Group Entities File for Chapter 11
VILLAGIO PARTNERS: Case Summary & 20 Largest Unsecured Creditors
VISTEON CORP: Eyes Takeovers to Boost Share
VOLKSWAGEN-SPRINGFIELD: OK'd to Use Parts Credits to Buy Products
VYSTAR CORPORATION: Had $685,000 Net Loss in 1st Quarter
WAVEDIVISION ESCROW: S&P Gives 'B-' Rating on $250M Senior Notes
WEST CORP: Intends to Offer $250 Million of Senior Notes
WESTERLY HOSPITAL: Lawrence + Memorial Only Bidder for Hospital
WESTERN COMMUNICATIONS: Full Payment Plan Wins Approval
WESTINGHOUSE SOLAR: Had $2.85 Million Net Loss in 1st Quarter
WEZBRA DAIRY: Ohio Dairy Farm Owner Files in Indiana
WEZBRA DAIRY: Case Summary & 20 Largest Unsecured Creditors
WIND CITY PENNA: Meeting to Form Committee Today
YNS ENTERPRISE: Files for Chapter 11 in Riverside
YNS ENTERPRISE: Case Summary & 14 Largest Unsecured Creditors
YRC WORLDWIDE: Incurs $22.6 Million Net Loss in Second Quarter
ZOGENIX INC: Repays Outstanding Loan with Oxford and Silicon
ZOGENIX INC: Great Point Discloses 5.8% Equity Stake
Z TRIM HOLDINGS: Edward Smith Discloses 74.2% Equity Stake
* Moody's Says Pension Plan Terminations Mostly Credit Neutral
* Moody's Says Book Value Wraps Expose US Life Insurers to Risk
* S&P's Global Corp Default Tally Rises to 49 Issuers
* S&P's Weakest Links Count Declines to 128
* Appreciation In Exempt Property Belongs to Trustee
* Sales Taxes Never Are Dischargeable
* Commercial Bankruptcies in July Down 26%, Says Epiq Systems
* Andrew D. Shaffer Joins Butzel Long's New York Office
* Futures Insurance Seen as Band-Aid for Brokerage Failures
* Upcoming Meetings, Conferences and Seminars
*********
1617 WESTCLIFF: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: 1617 Westcliff, LLC
1617 Westcliff Drive
Newport Beach, CA 92660
Bankruptcy Case No.: 12-bk-19326
Chapter 11 Petition Date: August 2, 2012
Court: U.S. Bankruptcy Court
Central District of California (Santa Ana)
Judge: Mark S. Wallace
Debtor's Counsel: D. Edward Hays, Esq.
MARSHACK HAYS LLP
870 Roosevelt Avenue
Irvine, CA 92620
Tel: (949) 333-7777
Fax: (949) 333-7778
E-mail: ehays@marshackhays.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Gary Rettig, president of Rettig
Portfolio, Inc.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Keller, Weber & Debrott Attorney's Fees $160,000
18201 Von Karman Avenue, Suite 1000
Irvine, CA 92612-2445
Southern California Edison Utilities $12,000
P.O. Box 600
Rosemead, CA 91771
Universal Building Maintenance Janitorial Services $7,635
1551 N. Tustin Avenue, Suite 650
Santa Ana, CA 92705
Life Safety Contract Service -- $3,646
Horizon Lighting Vendor $575
Waste Management Utilities $525
The Gas Company Utilities $200
Orange County Pest Control Utilities $90
AT&T Utilities ? Vendor $32
5 Star Elevator Service, Inc. Vendor Unknown
Access Exterminator Service, Inc. Pest Control - Unknown
Vendor
Bemus Landscape Landscape Services - Unknown
Vendor
BIS, Inc. Building Unknown
Maintenance ? Vendor
California Coast Plumbers, Inc. Vendor Unknown
City of Newport Beach Utilities ? Vendor Unknown
Keith S. Holland Elevator Service - Unknown
Vendor
Natural Ambience Landscape ? Vendor Unknown
Pacific Rim Mechanical A/C Repair ? Vendor Unknown
Patrol Masters, Inc. Security Services - Unknown
Vendor
PM Realty Group Receiver's Property Unknown
Management Co. ?
Notice Purposes
44 CP I LOAN: Sec. 341 Creditors' Meeting Set for Aug. 14
---------------------------------------------------------
The U.S. Trustee for the District of Arizona will convene a
meeting of creditors pursuant to 11 U.S.C. Sec. 341(a) in the
Chapter 11 cases of CP I Loan LLC and 44 CP II Loan LLC, on
Aug. 14, 2012, at 9:00 a.m. at the U.S. Trustee Meeting Room, 230
N. First Avenue, Suite 102, Phoenix, Arizona.
44 CP I Loan LLC and 44 CP II Loan LLC filed bare-bones Chapter 11
petitions (Bankr. D. Ariz. Case Nos. 12-15286 and 12-15287) in
Phoenix on July 9, 2012. The Debtors each estimated assets and
debts of $10 million to $50 million.
Judge Eileen W. Hollowell oversees the case. Mark Winkleman, as
chief operating officer, signed the Chapter 11 petition. The
Debtors are represented by Cathy L. Reece, Esq., at Fennemore
Craig, P.C.
501 GRANT STREET: Owner of Union Trust Building in Chapter 11
-------------------------------------------------------------
Mark Belko at Pittsburgh Post-Gazette reports that 501 Grant
Street Partners LLC, owner of the Union Trust Building, sought
Chapter 11 protection in U.S. Bankruptcy Court in Pittsburgh,
Pennsylvania, averting a possible sheriff sale set for Aug. 6,
2012. U.S. Bank, the mortgage holder, filed for foreclosure after
Allegheny County Common Pleas Court Judge Christine Ward ruled
last spring that the owner had defaulted on loan payments, the
report notes.
According to the report, the fate of the ornate Flemish Gothic
building, built nearly a century ago by industrialist Henry Clay
Frick, likely will rest in the hands of a federal bankruptcy
judge.
The report says 501 Grant Street Partners owes $41.1 million,
including interest and other costs.
The report relates U.S. Bank, in anticipation of the sheriff sale,
paid last week nearly $1.1 million in city, county and Pittsburgh
school district real estate taxes due on the property. That would
have prevented another buyer from acquiring the building for the
taxes due. Lisa Stauffer represents U.S. Bank.
The report, citing court documents, says 501 Grant Street Partners
listed assets and liabilities of $10 million to $50 million. It
listed the number of creditors at 49 or less. The largest
creditors included the Pittsburgh Water & Sewer Authority, the
Pittsburgh Downtown Business Improvement District, and the CBRE
real estate firm and an affiliate. The filing stated the amounts
owed to the PWSA and the business improvement district were
unknown. It listed the CBRE debts at $78,785.
5712 N. 67TH AVE: Files for Chapter 11 in Phoenix
-------------------------------------------------
5712 N. 67TH AVE., L.L.C., filed a bare-bones Chapter 11 petition
(Bankr. D. Ariz. Case No. 12-17606) in Phoenix on Aug. 6, 2012.
The Debtor estimated assets and debts of $10 million to
$50 million. The Debtor owns La Mesa Village in Glendale.
The Debtor controlled by Peter Bernal-owned NPHP Investments Inc.
According to the case docket, a meeting of creditors under
11 U.S.C. Sec 341(a) is scheduled for Sept. 11, 2012 at 9:00 a.m.
The Debtor is required to submit its schedule of assets and
liabilities, statement of financial affairs and other documents by
Aug. 20.
5712 N. 67TH AVE: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: 5712 N. 67th Ave., L.L.C.
5525 East Lincoln Drive, Lot 100
Paradise Valley, AZ 85253
Tel: (602) 523-3000
Bankruptcy Case No.: 12-17606
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
District of Arizona (Phoenix)
Judge: Charles G. Case, II
Debtor's Counsel: Don C. Fletcher, Esq.
LAKE AND COBB PLC
1095 West Rio Salado Parkway, #206
Tempe, AZ 85281
Tel: (602) 523-3000
Fax: (602) 523-3001
E-mail: dfletcher@lakeandcobb.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Peter Bernal, president of NPHP
Investments, Inc., the general partner.
ACCREDITED MEMBERS: Daimiel Global Discloses 25.5% Equity Stake
---------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Daimiel Global Resources disclosed that, as of
July 25, 2012, it beneficially owns 30,647,636 shares of common
stock of Hangover Joe's Holding Corporation, formerly known as
Accredited Members Holding Corporation, representing 25.47% of the
shares outstanding. A copy of the filing is available at:
http://is.gd/dvayBU
About Accredited Members
Colorado Springs, Colo.-based Accredited Members Holding
Corporation currently provides various services and products both
directly and through its subsidiary corporations Accredited
Members, Inc. ("AMI"), and AMHC Managed Services ("AMMS"), which
provides management services to third parties including services
typically provided by executive level personnel on a fix-contract
basis. Through August 2011, the Company provided services through
its subsidiary World Wide Premium Packers, Inc. ("WWPP").
The Company's balance sheet at March 31, 2012, showed
$2.11 million in total assets, $2.15 million in total liabilities,
and a stockholders' deficit of $40,790.
As reported in the TCR on April 9, 2012, GHP Horwath, P.C., in
Denver, Colorado, expressed substantial doubt about Accredited
Members' ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company reported a net loss of
approximately $3,461,000 and used net cash in operating activities
of approximately $2,125,000 in 2011, and has an accumulated
deficit of approximately $7,570,000 at Dec. 31, 2011.
ADVANCED MICRO: Fitch Rates Senior Notes Due 2022 at 'B+/RR3'
-------------------------------------------------------------
Fitch rates Advanced Micro Devices Inc.'s (NYSE: AMD) Senior Notes
due 2022 at 'B+/RR3' and affirms the following ratings for the
company:
-- Long-term Issuer Default Rating (IDR) at 'B';
-- Senior unsecured debt at 'B+/RR3'.
The Rating Outlook is revised to Stable from Positive.
AMD commenced a private offering of senior notes due 2022.
Proceeds from the senior notes will be used for general corporate
purposes, including debt reduction, payments to GLOBALFOUNDRIES to
purchase certain leading edge products from other suppliers, or
acquisitions.
The revision of Outlook to Stable from Positive reflects Fitch's
expectation that AMD's operating performance to remain challenged
through at least the near term. Visibility remains limited but
demand appears weak across the majority of AMD's end markets,
while inventory on hand increased 26 days to 82 days for the
recently ended second quarter from 56 at the end of the first
quarter.
Channel demand for desktops in Europe and China is lower than
expected with little promise of near-term recovery for Europe or a
resumption of previously more robust growth rates in China.
Softness in consumer demand is driving lower notebook sales and
intensifying pricing pressures, while graphics processors also are
experiencing weakness. Client and server markets appear to be
experiencing more pronounced than anticipated pricing pressures.
Positively, adoption of AMD's accelerated processing units (APU)
products remains solid and the anticipated Windows 8 launch should
provide some demand support. Nonetheless, Fitch believes AMD is
more vulnerable to cannibalization of desktops and notebooks by
tablets over the longer-term, given the company's limited
participation.
AMD has been able to maintain gross margins near 45%, although
Fitch believes this is due in part to sales pressures occurring
during the final weeks of the quarter. The resultant inventory
additions should further constrain processor shipments in the
second half of 2012. On a trailing 12 month (TTM) basis,
operating EBITDA is essentially flat at just over $850 million
from the comparable last year period.
Credit protection measures remain solid for the rating, albeit
within a cyclical context. Fitch estimates total leverage (total
debt to operating EBITDA) was approximately 2.3x for the TTM ended
June 30, 2012 and interest coverage (operating EBITDA to interest
expense) was 5.1x.
Pro forma for the debt issuance, Fitch believes AMD's liquidity at
June 30, 2012 is sufficient and supported by $1.8 billion of cash
and marketable securities. The company has no revolving credit
facility (RCF). Fitch's expectation for annual free cash flow of
up to $500 million also supports the company's liquidity.
Pro forma for the debt issuance, total debt at June 30, 2012 was
approximately $2.3 billion. Beyond the $300 million senior notes
offering, total debt consisted of:
-- $485 million of 5.75% senior unsecured convertible notes due
2012;
-- $580 million of 6% senior unsecured convertible notes due
2015;
-- $500 million of 8.125% senior unsecured notes due 2017;
-- $500 million of 7.75% senior unsecured notes due 2020; and
-- $24 million of capital leases.
The ratings continue to reflect AMD's:
-- Strengthened FCF profile: AMD's significantly lower capital
intensity will drive higher annual FCF. AMD's manufacturing
assets divestiture reduces capital spending as a percentage
of sales to the mid-single digits versus 10% - 30%
historically. Fitch Ratings expects AMD's annual FCF to
range from breakeven to $500 million through a normalized
semiconductor cycle.
-- AMD's essential role within the microprocessor market as a
credible second source supplier. Fitch believes AMD's role
as the MPU market's only credible second-source supplier with
significant production and design scale provides a floor for
market share; and
-- Slightly lower operating volatility from reduced operating
leverage associated with the transformation to a fabless
semiconductor maker. Furthermore, AMD's restructuring
actions over recent years has reduced fixed costs, resulting
in lower operating leverage. AMD's revenues will continue to
be highly cyclical, due to the company's competitive position
and substantial risks associated with MPU technology life
cycles; and
Ratings concerns continue to center on:
-- Intel's ongoing dominance of the microprocessor market,
resulting in superior financial flexibility that Fitch
believes will enable Intel to maintain its cost and
technology leadership over the longer-term;
-- Significant investment requirements and technology platform
and product risk associated with the microprocessor (MPU)
market. Fitch expects AMD's R&D will remain in excess of 20%
of revenues, which is higher than the industry average of
mid- teens; and
-- AMD's limited market share in servers and nascent
participation within smart phones and media tablets, which
Fitch believes will drive the majority of microprocessor
growth over the intermediate-term. Fitch believes AMD's
strong share of developing markets, most notably China, could
offset this concentration.
The ratings may be upgraded in the event of:
-- Diversification of foundry suppliers; or
-- Consistent annual free cash flow at the higher end of Fitch's
expected range, supporting the company's technology
platforms.
Further negative rating actions are unlikely in the absence of
sustained material sales declines.
AMD's Recovery Ratings (RRs) reflect Fitch's belief that the
company would be reorganized rather than liquidated in a
bankruptcy scenario. This is given Fitch's estimates that AMD's
reorganization value of approximately $1.5 billion exceeds a
projected liquidation value. Furthermore, Fitch believes AMD's
role as a credible viable alternative microprocessor supplier to
Intel also supports reorganization rather than liquidation of AMD
in a bankruptcy scenario. To arrive at a reorganization value,
Fitch assumes a 5x reorganization multiple, and applies it to its
estimate of distressed operating EBITDA of $300 million, which
covers estimated annual fixed charges, resulting in an adjusted
reorganization value of $1.3 billion after subtracting
administrative claims.
Based upon these assumptions, Fitch estimates recovery for the
estimated $2.2 billion of senior unsecured debt has increased to
51% - 70%, resulting in Recovery Ratings of 'RR3'.
ADVANCED MICRO: Moody's Rates New $300MM Sr. Unsecured Debt 'Ba3'
-----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to the proposed
$300 million senior unsecured debt offering by Advanced Micro
Devices. At the same time, the rating outlook is revised to stable
from positive.
The change in rating outlook to stable from positive reflects the
Moody's expectation that AMD's operating performance will be
moderately weaker than previously expected over the next year.
Combined with AMD's debt refinancing as opposed to repayment,
Moody's no longer expects leverage to decline sufficiently over
the near term to support credit metrics that would be supportive
of a higher rating.
In addition to continued good business execution, a reduction of
debt had been a supportive element of the previous positive rating
outlook. In its base case scenario, Moody's projects AMD will
generate between $700 million and $800 million of EBITDA over the
next year. In this scenario, debt to EBITDA (using Moody's
standard adjustments) will approximate 3.0x as compared to Moody's
previous expectations of about 2.0x.
Ratings Rationale
The Ba3 corporate family rating reflects AMD's risk profile
following the execution of the company's asset light strategy
combined with the late 2009 legal settlement with Intel. The
settlement paved the way for AMD to become a fabless firm, thereby
ridding it of the significant capital expenditure requirements and
enhancing AMD's prospects to generate more consistent
profitability and cash flow going forward.
AMD, through its foundry partner, GlobalFoundries ("GF") is still
subject to the challenges of consistently advancing manufacturing
process nodes and bringing competitive designs to the broad
computing market. While progress is being made, Moody's believes
consistent execution in manufacturing will remain a challenge,
which could periodically hamper AMD's ability to provide customers
consistently competitive semiconductor offerings.
However, with GF's much stronger financial resources and scale of
operations, Moody's believes AMD is better positioned to achieve
more consistent operating profitability (mid to high single digit
margins) and free cash flow (above $200 million over the next year
including one-time cash payments to GF).
Offsets to these positive factors include the high level of
business risk inherent to the volatile microprocessor segment of
the semiconductor industry, as well as the intense competition
from its much larger rival, Intel, who has a strong product
offering and significant financial, technical, and manufacturing
resources that allow it to compete very aggressively. AMD will
also need to invest in order to bring competitive offerings to the
fast growing tablet market that Moody's expects will reduce demand
for traditional computing form factors that AMD's microprocessors
currently target.
Moody's expects AMD to retain a very good liquidity position that
is supported by a large cash position and expectation of solid
free cash flow. To protect against market volatility and inherent
technology uncertainties, particularly process node transitions,
Moody's anticipates AMD will retain $1.5 billion or more of cash
balances. As of June 2012, AMD had $1.8 billion of cash and
marketable securities. AMD does not maintain a committed revolving
credit facility. Despite the current soft demand for PC's, Moody's
expects AMD will continue to generate free cash flow under its
fabless business model. Combining its expectations of positive
free cash flow with existing cash balances, Moody's does not view
the lack of a credit facility as a detriment to its liquidity
profile. After the $485 million debt maturity this August, AMD's
next debt maturity is a $580 million note due May 2015.
Ratings assigned include:
$300 million senior unsecured note -- rated Ba3 (LGD4-54%)
The stable rating outlook reflects Moody's expectation that
despite the more challenging market conditions, AMD will continue
to generate free cash flow over the intermediate term, partly
driven by the company's fabless business model that significantly
reduces capital expenditure requirements. The outlook also embeds
the expectation that AMD and its foundry partners will demonstrate
good execution on product designs and manufacturing.
The rating could be raised if AMD is able to sustain profitable
growth of its core microprocessor business while maintaining or
growing market share and continuing with a credible technology
roadmap. Additionally, the rating could be raised if Moody's
believes AMD is likely to reduce and sustain adjusted debt to
EBITDA to 2.0 times while maintaining cash balances above $1.5
billion.
The rating could be lowered if AMD's microprocessor and graphics
chips units fail to sustain operating profitability that should be
in the high single digits or if the company sustains market share
losses, which would likely relate to delayed or inferior product
offerings.
The principal methodology used in rating Advanced Micro Devices
was the Global Semiconductor Industry Methodology published in
November 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.
ADVANCED MICRO: S&P Affirms 'BB-' Corp. Credit Rating; Outlook Neg
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Advanced Micro Devices Inc. (AMD) to negative from stable. "We
also affirmed our 'BB-' corporate credit rating on the company,"
S&P said.
"At the same time, we assigned our 'BB-' issue-level rating to
AMD's proposed $300 million senior unsecured notes due 2022," S&P
said.
"The outlook revision reflects our view of the company's prospects
for near-term operating weakness and its plan to refinance its
August 2012 notes maturity, resulting in our anticipation of
higher leverage over the next 12 months," said Standard & Poor's
credit analyst John Moore.
"The proposed notes will rank equally with all of AMD's existing
and future senior unsecured debt. The company intends to use the
proceeds from this offering, along with available cash, to
refinance all of its $485 million outstanding senior unsecured
convertible notes maturing Aug. 15, 2012," S&P said.
"The 'BB-' corporate credit rating reflects AMD's 'weak' business
risk profile, characterized by intense competition from Intel
Corp. and the threat of competition from ARM-based (a type of
computing instruction set) competitors, partly offset by the
company's moderately leveraged balance sheet at this point, which
we characterize as a 'significant' financial risk profile. The
ratings also reflect the company's 'adequate' liquidity," S&P
said.
"The outlook is negative, reflecting decreasing near-term
operating performance and increased leverage. A downgrade could
result from a number of developments, including protracted lower
demand, erosion of market share, or weaker manufacturing
execution. Any of these scenarios could weaken the financial
profile that supports the rating. Specifically, we would consider
a lower rating if liquidity fell below $1 billion or if leverage
were to be sustained above 3x. We would consider an outlook
revision to stable if leverage was on a trajectory to be sustained
in the mid-2x range," S&P said.
AES EASTERN: Plan Exclusivity Hearing Today
-------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware will
convene a hearing on Aug. 8, 2012, at 10 a.m., to consider AES
Eastern Energy, L.P., et al.'s motion for a second extension of
their exclusive period to propose a Chapter 11 plan.
The Debtors are asking the Court extend their exclusive periods to
file and solicit acceptances for the proposed chapter 11 plan
until Oct. 25, 2012, and Dec. 24, respectively.
The Debtors explain that they are in negotiations with an
interested purchaser who has proposed to purchase all of their
remaining assets and assume associated remediation obligations.
A group of noteholders are objecting to the Debtors' request. The
group said that AES has squandered its time to negotiate a plan
and prepare adequate information, and that the Debtor has not made
good faith progress toward reorganization.
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 plants 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 is the
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., serve as counsel to the Creditors Committee. FTI
Consulting Inc. is the financial advisor.
AES Eastern Energy prevailed over opposition and obtained
authorization to hold a March 26 auction for the two operating
power plants. Under a deal reached prepetition, the Debtor would
turn the two operating facilities over to debt holders in exchange
for debt, absent higher and better offers.
AHERN RENTALS: Court OKs GA Keen as Real Estate Advisor
-------------------------------------------------------
The Hon. Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada authorized Ahern Rentals, Inc., to employ GA
Keen Realty Advisors, LLC as real estate advisor.
As reported in the Troubled Company Reporter on June 21, 2012, the
Debtor will pay GA Keen, on a per property basis, the greater of
$1,500 or 4.5% of Savings for lease negotiation fees. For
evaluation fees, the Debtor will pay GA Keen $450 per leasehold
property evaluation, 50% payable upon the Debtor's written
designation of a property to be evaluated and 50% within five
business days of the delivery of the draft report.
The Court also ordered that none of the fees payable to GA Keen
will constitute a "bonus" under applicable law.
About Ahern Rentals
Founded in 1953 with one location in Las Vegas, Nevada, Ahern
Rentals Inc. -- http://www.ahern.com/-- now offers rental
equipment to customers through its 74 locations in Arizona,
Arkansas, California, Colorado, Georgia, Kansas, Maryland,
Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North
Dakota, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee,
Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
In its schedules, the Debtor disclosed $485.8 million in assets
and $649.9 million in liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
AMPAL-AMERICAN ISRAEL: Had $284.3 Million Loss in First Quarter
---------------------------------------------------------------
Ampal-American Israel Corporation filed its quarterly report on
Form 10-Q, reporting a net loss of US$284.34 million on
US$133.21 million of revenues for the three months ended March 31,
2012, compared with net income of US$15.04 million on
US$136.57 million of revenues for the comparable period in 2011.
The Company's balance sheet at March 31, 2012, showed
US$572.89 million in total assets, US$802.39 million in total
liabilities, US$623,000 of redeemable noncontrolling interest, and
a stockholders' deficit of US$230.12 million.
As reported in the TCR on April 9, 2012, Kesselman & Kesselman, in
Tel-Aviv, Israel, expressed substantial doubt about Ampal-American
Israel's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that Ampal does not have sufficient
cash and other resources to serve its debt and finance its ongoing
operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/IPRRe3
New York, N.Y.-based Ampal-American Israel Corporation was founded
in 1942. The Company primarily acquires interests in businesses
located in the State of Israel or that are Israel-related.
Ampal's investment focus is principally on companies or ventures
where Ampal can exercise significant influence, on its own or with
investment partners, and use its management experience to enhance
those investments. In determining whether to acquire an interest
in a specific company, Ampal considers quality of management,
potential return on investment, growth potential, projected cash
flow, investment size and financing, and reputable investment
partners.
AVENTINE RENEWABLE: Moody's Lowers CFR/PDR to 'Ca'
--------------------------------------------------
Moody's Investors Service lowered Aventine Renewable Energy
Holdings Inc.'s Corporate Family Rating (CFR) to Ca from Caa3 and
Probability of Default Rating to Ca/LD from Caa3. Concurrently,
Moody's also downgraded Aventine's term loan rating to Ca from
Caa3. The rating outlook is negative. The Speculative Grade
Liquidity Rating is unchanged at SGL-4. These rating actions
conclude the ratings review initiated on July 19, 2012 when the
ratings were placed under review for possible downgrade.
The CFR downgrade and Ca/LD probability of default rating reflect
Moody's understanding that Aventine did not make its scheduled
July 31, 2012 term loan interest payment. According to the term
loan agreement, Aventine had a 5 day grace period to make the
interest payment which Moody's believes expired on August 5, 2012.
Moody's definition of default captures all missed or delayed
interest or principal payments according to the original terms of
a contractual obligation.
The company is currently operating under a forbearance agreement
with its lenders. The lenders agreed to, among other things, not
consider the missed interest payment due on July 31, 2012 as an
event of default. The agreement was executed on July 27, 2012 and
runs to September 7, 2012, or earlier if occurrence of a further
event of default takes place under the term loan or revolver.
The "LD" designation will remain in place until clarity over the
resolution of the missed interest payment develops.
The following ratings were affected:
Corporate Family Rating -- to Ca from Caa3;
Probability of Default Rating -- to Ca/LD from Caa3;
$215 million Sr sec term loan B due 2015 -- to Ca (LGD4, 56%)
from Caa3 (LGD4, 56%);
Speculative Grade Liquidity Rating -- unchanged at SGL-4
Ratings Rationale
Aventine's Ca corporate family rating reflects Aventine's
inability to make timely interest payment, deteriorating operating
and financial performance with dramatic increase in corn prices
resulting from ongoing severe drought in the main corn producing
areas in the US, reduction in discount between ethanol and
gasoline prices, and very weak liquidity. Moody's believes that
Aventine would have to do financial restructuring in order to
continue operating beyond the very near term.
The negative outlook reflects Moody's expectation for a continued
weak operating environment that limits the company's ability to
generate positive operating margins, and current financial
distress which could result in a distressed exchange or bankruptcy
filing. The rating could be upgraded if the company is successful
in restructuring the capital structure and improving its liquidity
profile, and if its performance is expected to improve materially.
Ratings could be revised downward or withdrawn in an event of a
distressed exchange or bankruptcy filing.
The principal methodology used in rating Aventine Renewable Energy
Holdings, Inc 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.
Aventine Renewable Energy Holdings, Inc. (Aventine) is a producer
and marketer in the United States of corn-based ethanol used as a
blending component for gasoline. The company produces ethanol and
co-products at plants in Pekin, IL (wet mill and dry mill plants),
Aurora, NE (dry mill plant) and Mt. Vernon, IN (dry mill plant)
with approximately 312 million gallons per year of capacity. The
firm emerged from bankruptcy on March 15, 2010. Revenues for the
twelve months ended March 31, 2012, were approximately
$890 million.
BANKATLANTIC BANCORP: BB&T Buys Bank; Now Known as BBX Capital
--------------------------------------------------------------
BankAtlantic Bancorp, Inc., and BB&T Corporation have completed a
transaction in which BB&T acquired BankAtlantic, the Company's
wholly owned bank subsidiary. The transaction, originally
announced on Nov. 1, 2011, closed on July 31, 2012.
Concurrent with the closing, BankAtlantic Bancorp has changed its
name to BBX Capital Corporation and will remain listed on the New
York Stock Exchange and continue to trade under the same ticker
symbol: BBX. Going forward, BBX Capital anticipates its request
to the Federal Reserve to deregister the Company as a savings and
loan holding company will be approved. BBX Capital plans to
manage the assets it has retained as a result of the transaction
and engage in a real estate investment and specialty finance
business over time as assets are monetized.
BBX Capital anticipates recording an estimated gain on the sale of
BankAtlantic of approximately $307 million.
Upon closing of the Transaction, Valerie C. Toalson, the Company's
Chief Financial Officer and principal accounting officer, and
Lloyd B. DeVaux, the Company's Chief Operating Officer, became
employees of BB&T, and their respective positions with the Company
terminated. It is expected that Ms. Toalson and Mr. DeVaux will
serve as employees of BB&T for at least a transition period to
assist with post-closing and conversion-related activities.
It is anticipated that John K. Grelle will be appointed as the
Company's Chief Financial Officer and principal accounting officer
at a meeting of the Company's Board of Directors scheduled for
Aug. 7, 2012. The Company's Board of Directors remains unchanged
post-closing, and includes, in addition to the six other
continuing directors, Alan B. Levan, the Company's Chairman and
Chief Executive Officer, John E. Abdo, the Company's Vice
Chairman, and Jarett S. Levan, the Company's President.
A copy of the Form 8-K is available for free at:
http://is.gd/wvDjA3
About BankAtlantic Bancorp
BankAtlantic Bancorp (NYSE: BBX) --
http://www.BankAtlanticBancorp.com/-- is a bank holding company
and the parent company of BankAtlantic. BankAtlantic --
"Florida's Most Convenient Bank" with a Web presence at
http://www.BankAtlantic.com/-- has nearly $6.0 billion in assets
and more than 100 stores, and is one of the largest financial
institutions headquartered junior in Florida. BankAtlantic has
been serving communities throughout Florida since 1952 and
currently operates more than 250 conveniently located ATMs.
BankAtlantic reported a net loss of $28.74 million in 2011, a net
loss of $143.25 million in 2010, and a net loss of $185.82
million in 2009.
BankAtlantic's balance sheet at March 31, 2012, showed $3.84
billion in total assets, $3.87 billion in total liabilities and a
$31.56 million total deficit.
* * *
As reported by the TCR on March 1, 2011, Fitch has affirmed its
current Issuer Default Ratings for BankAtlantic Bancorp and its
main subsidiary, BankAtlantic FSB at 'CC'/'C' following the
announcement regarding the regulatory order with the Office of
Thrift Supervision.
BankAtlantic has announced that it has entered into a Cease and
Desist Order with the OTS at both the bank and holding company
level. The regulatory order includes increased regulatory capital
requirements, limits to the size of the balance sheet, no new
commercial real estate lending and improvements to its credit risk
and administration areas. Further, the holding company must also
submit a capital plan to maintain and enhance its capital
position.
BAOSHINN CORPORATION: Had $50,200 Net Loss in First Quarter
-----------------------------------------------------------
Baoshinn Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $50,177 on $9.83 million of revenues for
the three months ended March 31, 2012, compared with net income of
on $32,489 on $8.61 million of revenues for the same period of
2011.
The Company's balance sheet at March 31, 2012, showed
$8.29 million in total assets, $7.40 million in total liabilities,
and stockholders' equity of $890,053.
As reported in the TCR on April 17, 2012, Albert Wong, in Hong
Kong, expressed substantial doubt about Baoshinn's ability to
continue as a going concern, following the Company's results for
the fiscal year ended Dec. 31, 2011. The independent auditors
noted that the Company has accumulated losses.
A copy of the Form 10-Q is available for free at:
http://is.gd/ckBGTT
Located in Kowloon, Hong Kong, Baoshinn Corporation, through its
Hong Kong subsidiary, is ticket consolidator of major
international airlines, including Thai Airways, Eva Airways,
Dragon Air, Air China, China Southern Airlines, China Eastern
Airlines, HongKong Airlines & HongKong Express. The Company
provides travel services such as ticketing, hotel and
accommodation arrangements, tour packages, incentive tours and
group sightseeing services to customers located in Hong Kong and
Mainland China.
BEAZER HOMES: Incurs $39.8 Million Net Loss in Fiscal 3rd Quarter
-----------------------------------------------------------------
Beazer Homes USA, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing a
net loss of $39.88 million on $254.55 million of total revenue for
the three months ended June 30, 2012, compared with a net loss of
$59.12 million on $172.82 million of total revenue for the same
period during the prior year.
The Company reported a net loss of $79.09 million on
$634.74 million of total revenue for the nine months ended June
30, 2012, compared with a net loss of $161.68 million on $407.49
million of total revenue for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $1.82 billion
in total assets, $1.64 billion in total liabilities and $179.07
million in total stockholders' equity.
"I am very pleased with our third quarter results," said Allan
Merrill, CEO of Beazer Homes. "We generated improvement in new
home orders, home closings and backlog, recording our fourth
consecutive quarter of year-over-year increases in these metrics.
This improvement reflects both the continuing operational benefits
of our path-to-profitability strategies and gradually improving
conditions in the housing market.
Subsequent to quarter-end, we successfully raised over $170
million in growth capital from concurrent equity and equity-linked
offerings which we will use to reinvest in targeted markets. We
also refinanced our 12% secured notes at a significantly lower
cost which will save approximately $15 million per year. Taken
together, we expect these actions to help accelerate our return to
profitability."
A copy of the Form 10-Q is available for free at:
http://is.gd/8kXgJa
About Beazer Homes
Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/--
headquartered in Atlanta, is one of the country's 10 largest
single-family homebuilders with continuing operations in Arizona,
California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada,
New Jersey, New Mexico, North Carolina, Pennsylvania, South
Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed
on the New York Stock Exchange under the ticker symbol "BZH."
* * *
Beazer carries (i) a 'B-' issuer credit rating, with "negative"
outlook, from Standard & Poor's, (ii) 'Caa2' probability of
default and corporate family ratings from Moody's, and
(iii) 'CCC' issuer default rating from Fitch Ratings.
Fitch said in September 2011 that the downgrade from 'B-' to 'CCC'
reflects Fitch's belief new housing activity will remain weak
through at least 2012 and the company's liquidity position is
likely to erode in the next 18 months. In July 2012, Fitch said
that while it expects better prospects for the housing industry
this year, there are still significant challenges facing the
housing market, which are likely to meaningfully moderate the
early stages of this recovery.
Moody's said in July 2012 that the 'Caa2' CFR reflects Moody's
expectation that Beazer's operating and financial performance,
while improving, will remain weak through fiscal 2013.
Moody's expects that Beazer's cash flow generation will continue
to be weak in fiscal 2012 and 2013.
"Our current rating outlook on Beazer is negative. We would
consider a downgrade if the company's EBITDA growth fails to meet
our expectations or if the downturn in the housing market lingers
longer than we expect and unit volume remains depressed," S&P
said in July 2012.
BERNARD L. MADOFF: Claims Immunity From State Lawsuits
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that the wives of Bernard Madoff's two sons argued in papers filed
in U.S. District Court in Manhattan that they are immune from
suits brought under state law.
The report recounts that in May the trustee liquidating Bernard L.
Madoff Investment Securities LLC revised his complaint against the
Madoff family by adding a wife, a widow, and a former wife of sons
of Bernard Madoff as defendants on $57.5 million in claims. The
claims against the spouses were part of an existing $255 million
complaint against the Madoff family.
The report relates U.S. District Judge Jed Rakoff took the suit
out of bankruptcy court to decide what parts of the lawsuit could
survive and what should be thrown out without a trial. Judge
Rakoff directed Stephanie Mack, Mark Madoff's widow, and Deborah
Madoff, Andrew Madoff's wife, to file papers discussing whether
the so-called in pari delicto defense bars the trustee's claims
brought under state law.
The spouses argued in papers filed with Judge Rakoff on Aug. 3
that the narrow exception for so-called insiders does not pertain
to them just because they were married to company officers. They
believe the in pari delicto defense is applicable unless they were
insiders exercising "de facto control" of the company, according
to the report.
The report relays the spouses admit that they can be sued for
receipt of actually fraudulent transfers going back two years
before bankruptcy. They believe they can't be sued under state
law for receipt of fraudulently obtained property going back years
earlier. The in pari delicto defense is judge-made equity law
going back centuries. The defense bars someone who participated
in fraud from using a court to sue anyone else involved in the
fraud. The defense has been applied to bar suits by bankruptcy
trustees because they step into shoes of the company committing
the fraud.
The family lawsuit is Picard v. Estate of Mark Madoff, 09-01503,
U.S. District Court, Southern District of New York (Manhattan).
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
The SIPA Trustee has said that as of March 31, 2012, through
prepetition litigation and other settlements, he has successfully
recovered, or reached agreements to recover, more than $9 billion
-- over 50% of the principal lost in the Ponzi scheme by those who
filed claims -- for the benefit of all customers of BLMIS.
The liquidation has so far has cost the Securities Investor
Protection Corp. $1.3 billion, including $791 million to pay a
portion of customers' claims.
BERNARD L. MADOFF: Customers Ask Dist. Judge to Rule on 2nd Payout
------------------------------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle, reports a lawyer for some of Bernard L.
Madoff's customers asked a federal district judge to decide
whether the liquidator of the confidence man's brokerage can pay
customers $1.5 billion to $2.4 billion as he proposed. A judge
must first rule on a demand by some customers that they also be
paid 9 percent interest on their claims, the lawyer, Helen
Chaitman, said in a federal court filing in Manhattan.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
The SIPA Trustee has said that as of March 31, 2012, through
prepetition litigation and other settlements, he has successfully
recovered, or reached agreements to recover, more than $9 billion
-- over 50% of the principal lost in the Ponzi scheme by those who
filed claims -- for the benefit of all customers of BLMIS.
The liquidation has so far has cost the Securities Investor
Protection Corp. $1.3 billion, including $791 million to pay a
portion of customers' claims.
Mr. Picard has so far made only one distribution in October of
$325 million for 1,232 customer accounts. Uncertainty created by
the appeals has limited Mr. Picard's ability to distribute
recovered funds. Outstanding appeals include the $5 billion
Picower settlement and the $1.025 billion settlement.
BEST BUY: Fitch Places 'BB+' IDR on Rating Watch Negative
---------------------------------------------------------
Fitch Ratings has downgraded Best Buy Co., Inc.'s Issuer Default
Rating (IDR) to 'BB+' from 'BBB-', and has placed the company's
ratings on Rating Watch Negative. As of May 5, 2012, Best Buy had
$2.0 billion of debt outstanding.
The downgrade reflects Fitch's assessment that Best Buy's business
profile, including its weakening comparable (comp) store sales,
recent margin pressure that Fitch believes will continue, and
heightened event risk, is no longer consistent with an investment
grade rating.
The Rating Watch reflects the possibility of a leveraging
transaction following the report today that Best Buy's Founder,
Richard Schulze, has offered to take the company private at $24 -
$26 per share, or up to $8.8 billion. Fitch understands that
under Minnesota law he may need permission from Best Buy's board
of directors to form a buyout group.
Assuming he receives this permission and succeeds in acquiring the
company, Fitch projects that Best Buy's leverage (adjusted
debt/EBITDAR) would increase from 2.6x currently to at least 3.7x,
and possibly the mid to high 4x, depending on the actual purchase
price and the amount of equity in the transaction.
The high end of the range of Mr. Schulze's offer equates to only
3.3x LTM EV/EBITDA. Potential buyers could also consider major
cost cutting and accelerating the downsizing of the company's
retail foot print versus current management plans.
However, as with any potential leveraged buyout, value and risk
must be weighed. Fitch believes the company faces significant
competitive hurdles, with the potential for an accelerating shift
in consumer electronics sales to the online channel as price-
conscious consumers gravitate toward the lowest prices, making it
difficult for the company to maintain market share. Best Buy
could become more promotional to protect market share, at the
expense of margins.
On top of this, macro headwinds such as high unemployment and a
soft housing market are likely to continue to hamper consumers,
particularly with respect to large ticket discretionary purchases.
Best Buy's restructuring efforts -- including accelerated store
closings and a reengineering of its operations to take excess
costs out of the system -- as a public entity or as a private firm
-- will be beneficial but may be insufficient to offset the
pressures facing its business.
In the event a buyout occurred, Best Buy's bondholders would be
protected by change of control language and limitations on liens
covenants. Each of Best Buy's three bond issues allows
bondholders to put their notes back to the company at a price of
101 in the event an entity acquires more than 50% of the company's
voting shares and the bonds are downgraded to below investment
grade by each of the rating agencies (as defined). In addition,
liens are limited to the greater of 15% of consolidated net
tangible assets or 10% of consolidated capitalization.
Best Buy's financial performance weakened in the first quarter
ended May 5, 2012, when comp store sales fell 5.3%, following a
1.7% decline in fiscal 2012 (ending March 3, 2012). Best Buy's
comp sales have not been materially positive since calendar 2007,
even after incorporating strong growth (18% in fiscal 2012) in
domestic online revenues, implying further erosion in the
productivity of Best Buy's retail stores.
Operating EBIT margins narrowed by nearly 80bp year over year in
the first quarter, after being flat in fiscal 2012. Given Fitch's
expectation that comp store sales will likely remain negative in
the low to mid-single digit range, and the promotional nature of
the consumer electronics sector, full-year EBIT margins will
likely narrow meaningfully even after taking into account expected
cost reductions.
The company's plan to take $800 million out of its cost structure
over the next three years (including $250 million in the current
year) will provide some support to margins, though much of the
savings are expected to be invested in improved customer service
and sharper prices as Best Buy seeks to improve its competitive
position vis-a-vis pure online retailers.
Financial leverage (adjusted debt/EBITDAR) was 2.6 times (x) in
the twelve months ending May 5, 2012, compared with 2.4x at end-
fiscal 2011, and Fitch believes that, in the absence of a buyout,
it could move up modestly from these levels as margins gradually
contract while debt levels remain flat.
Best Buy repurchased $1.5 billion of its shares in fiscal 2012 and
$1.2 billion in fiscal 2011, and has indicated that it will
repurchase $750 million to $1 billion in fiscal 2013. This
compares with Fitch's expectation for FCF after dividends of about
$1 billion in fiscal 2013.
Best Buy has ample liquidity with $1.4 billion in cash, short-term
investments and zero draw under its $2.5 billion revolving credit
facility as of May 5, 2012. Upcoming debt maturities include $500
million of unsecured notes in 2013, which Fitch expects the
company could refinance or pay down with cash on hand.
What Could Trigger A Rating Action
Positive: Given the trends in Best Buy's business, there is little
potential for an upgrade over the medium-term.
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- Further evidence of erosion in Best Buy's ability to defend
its market share in the face of significant and growing
competition.
-- Ongoing weakness in comp store sales in the negative mid-
single digit range.
-- Further EBIT margin compression toward the low 4.0% range.
Fitch has taken the following rating actions:
-- Long-term IDR to 'BB+' from 'BBB-';
-- Bank credit facility to 'BB+' from 'BBB-';
-- Senior unsecured to 'BB+' from 'BBB-';
The ratings are on Rating Watch Negative.
BEST BUY: S&P Cuts Corp. Credit Rating to 'BB+' After Buyout Offer
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating and other ratings on Best Buy Co. Inc. to 'BB+' from
'BBB-'. The ratings remain on CreditWatch with negative
implications, where they were originally placed on April 4, 2012.
"At the same time, we assigned our '3' recovery rating to the
company's senior unsecured debt, indicating our expectations for
meaningful (50% to 70%) recovery under a simulated default
scenario. While numerically, the recovery expectations for the
senior unsecured debt are greater than 70%, we are capping the
recovery rating at '3' given the potential for additional
indebtedness," S&P said.
"The rating action is a result of founder and largest shareholder,
Richard Schulze's proposal to acquire the company for a purchase
price in the range of $24.00 to $26.00 per share. We estimate at
the current proposal would result in a total purchase price of
approximately $9 billion," S&P said.
"The transaction, if completed, would materially weaken Best Buy's
credit protection metrics because we believe it will add a
significant amount of debt," explained Standard & Poor's credit
analyst Jayne Ross.
"In our opinion, a meaningfully debt-financed transaction by Mr.
Schulze would weaken Best Buy's credit protection metrics
considerably from current levels. As of the first quarter ended
May 5, 2012, the company's adjusted total debt to EBITDA was 1.9x
and interest coverage was 6.5x," S&P said.
"Depending on the amount of debt to be used in a buyout and our
view of a turnaround plan for the company's operations given the
changing industry dynamics," added Ms. Ross, "we could lower the
rating by multiple notches."
"We estimate that a $9 billion transaction would result in pro
forma debt leverage of about 3.8x and EBITDA to interest coverage
of about 2.5x," S&P said.
"We aim to resolve the CreditWatch as soon as possible, subject to
the timing of a proposed transaction, if any. If no transaction
occurs, we would expect to resolve the CreditWatch based on the
current management team's business strategy, cost-reduction and
growth initiatives to improve the company's business model, and
its implications for our overall assessment of the company's
credit profile. In addition, our analysis will focus on our view
of the secular changes in the industry and Best Buy's ability to
adapt its model to those changes," S&P said.
BION ENVIRONMENTAL: Extends Maturity of CEO Deferred Compensation
-----------------------------------------------------------------
Bion Environmental Technologies, Inc., memorialized an agreement,
effective June 30, 2012, for Dominic Bassani, the Company's chief
executive officer, to extend the maturity date of certain
convertible deferred compensation totaling $198,000 to Jan. 15,
2014.
About Bion Environmental
Bion Environmental Technologies Inc.'s patented and proprietary
technology provides a comprehensive environmental solution to a
significant source of pollution in US agriculture, large scale
livestock facilities known as Confined Animal Feeding Operations.
Bion's technology produces substantial reductions of nutrient
releases (primarily nitrogen and phosphorus) to both water and air
(including ammonia, which is subsequently re-deposited to the
ground) from livestock waste streams based upon the Company's
operations and research to date (and third party peer review).
As of March 31, 2012, Bion had total assets of $8,528,685, total
liabilities of $9,214,838 and total deficit of $728,678.
"The Company has not generated revenues and has incurred net
losses (including significant non-cash expenses) of approximately
$6,998,000 and $2,976,000 during the years ended June 30, 2011,
and 2010, respectively, and a net loss of approximately $5,831,000
for the nine months ended March 31, 2012. At March 31, 2012, the
Company has a working capital deficit and a stockholders' deficit
of approximately $383,000 and $814,000 respectively. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.," the Company said in its quarterly
report for the period ended March 31, 2012.
BITI LLC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Biti LLC
123 South Street, Suite 201 - 204
Oyster Bay, NY 11771
Bankruptcy Case No.: 12-74810
Chapter 11 Petition Date: August 2, 2012
Court: U.S. Bankruptcy Court
Eastern District of New York (Central Islip)
Judge: Robert E. Grossman
About the Debtor: The Debtor, a Single Asset Real Estate as
defined in 11 U.S.C. Sec. 101(51B), owns 11.701
acres of property located at the south side of
Skillman Street, west of Bryant Avenue, Village
of Roslyn.
Debtor's Counsel: Ronald M. Terenzi, Esq.
STAGG, TERENZI, CONFUSIONE, & WABNIK, LLP
401 Franklin Avenue
Garden City, NY 11530
Tel: (516) 812-4500
E-mail: rterenzi@stcwlaw.com
Scheduled Assets: $14,146,612
Scheduled Liabilities: $12,900,070
The petition was signed by William Cohn, member.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Americo Magalhaes Loan $1,265,000
123 South Street
Oyster Bay, NY 11771
NTEC, LLC Loan $975,000
2442 Merrick Road
Bellmore, NY 11710
The Christopher Companies Loan $854,000
102 Duck Pond Road
Glen Cove, NY 11542
TIBI Contracting Corp Loan $800,000
123 South Street, Suite 201/204
Oyster Bay, NY 11771
Receiver of Taxes Taxes $652,777
Charles Berman
200 Plandome Road
Manhasset, NY 11030
Cen Family Rolslyn LLC Loan $624,000
123 South Street, Suite 201/204
Oyster Bay, NY 11771
Nelson & Pope -- $310,896
Engineers & Land Surveyor
572 Walt Whitman Road
Melville, NY 11747
CUE Realty Profit Sharing Loan $250,000
2442 Merrick Road
Bellmore, NY 11710
Rosenberg Calica Birney -- $216,628
Incorporated Village of Roslyn Due $145,918
Jay Quinn -- $145,781
Core Group Architects Services $72,500
Stop & Shop -- $54,848
Nelson, Pope & Voorhis -- $16,342
Crowe Deegan LLP -- $7,020
Bill Cohn Loan $6,000
All Island Cleaning -- $1,288
Quality Pest Control -- $788
RC Complete Landscaping -- $651
R & P Landscaping -- $525
BLAST ENERGY: Completes Merger Transaction with PEDCO
-----------------------------------------------------
PEDEVCO Corp., formerly Blast Energy Services, Inc., completed the
transactions contemplated by the Jan. 13, 2012, Agreement and Plan
of Reorganization, by and between the Company, Blast Acquisition
Corp., a wholly-owned Nevada subsidiary of the Company, and
Pacific Energy Development Corp., a privately-held Nevada
corporation.
Pursuant to the Merger Agreement and effective July 27, 2012,
MergerCo was merged with and into PEDCO, with PEDCO continuing as
the surviving entity and becoming a wholly-owned subsidiary of the
Company, in a transaction structured to qualify as a tax-free
reorganization. In connection with the Merger, the Company issued
former security holders of PEDCO 17,917,261 shares of common
stock, 19,716,676 shares of new Series A Preferred Stock, warrants
to purchase an aggregate of 1,120,000 shares of the Company's
common stock, warrants to purchase 692,584 shares of the Company's
new Series A Preferred Stock, and options to purchase 4,235,000
shares of the Company's common stock.
Additionally, immediately prior to the Merger becoming effective,
the shareholders of the Company, at the meeting, approved an
Amended and Restated Certificate of Formation and an Amended and
Restated Series A Convertible Preferred Stock Designation which:
(i) converted all outstanding shares of the Company's Series A
Convertible Preferred Stock and Series B Preferred Stock into
common stock of the Company on a one to one basis, and immediately
thereafter, (ii) effectuated a one for one hundred and twelve
(1:112) reverse stock split of the Company's then outstanding
common stock.
Furthermore, in connection with the Reverse Split and the Amended
and Restated Certificate of Formation, the Company changed its
name to "PEDEVCO Corp.", and amended its Certificate of
Formation, to affect various changes to its Certificate of
Formation, including, but not limited to increasing the Company's
authorized capitalization to 300,000,000 shares of capital stock
post-Reverse Split, which includes 200,000,000 shares of common
stock, $0.001 par value per share; and 100,000,000 authorized
shares of Preferred Stock, including 25,000,000 authorized shares
of Series A Convertible Preferred Stock, $0.001 par value per
share, which shares were designated in connection with approval of
and filing of the Amended and Restated Certificate of Designations
of the Company's Series A Convertible Preferred Stock, which
amended and replaced the prior designation of the Company's Series
A Convertible Preferred Stock.
As a result of the name change and Reverse Split, the Company's
trading symbol on the Over-The-Counter Bulletin Board will be
changing to "BESVD", effective Aug. 3, 2012, for 20 business days
and will change to a new symbol thereafter. The name change to
PEDEVCO Corp. will also become effective with the Over-The-Counter
Bulletin Board on Aug. 3, 2012.
Effective in connection with the closing of the Merger, a change
in control of the Company occurred, and the former shareholders of
PEDCO obtained voting control over the Company.
Effective on July 27, 2012, as a required term of the Merger,
Roger P. (Pat) Herbert resigned as as a Director of, as Chairman
of the Board of Directors of, and as Interim President and Chief
Executive Officer of the Company; Donald E. Boyd resigned as a
member of the Board of Directors of the Company; and John A.
MacDonald resigned as the Executive Vice President, Chief
Financial Officer and Secretary of the Company.
Additionally effective July 27, 2012, Frank C. Ingriselli was
appointed as Chairman of the Board of Directors of the Company and
Michael L. Peterson and Jamie Tseng were appointed as Directors of
the Company, and Mr. Ingriselli was further appointed as the
President and Chief Executive Officer of the Company; Mr. Peterson
was further appointed as the Chief Financial Officer and Executive
Vice President of the Company; Mr. Tseng was further appointed as
the Senior Vice President of the Company; and Clark R. Moore was
appointed as the Executive Vice President, General Counsel and
Secretary of the Company.
A complete copy of the Form 8-K as filed with the Securities and
Exchange Commission is available at http://is.gd/CZGR1I
About Blast Energy
Houston, Texas-based Blast Energy Services, Inc., is seeking to
become an independent oil and gas producer with additional revenue
potential from its applied fluid jetting technology. The Company
plans to grow operations initially through the acquisition of oil
producing properties and then eventually, to acquire oil and gas
properties where its applied fluid jetting process could be used
to increase the field production volumes and value of the
properties in which it owns an interest.
In the auditors' report accompanying the financial statements for
year ended Dec. 31, 2011, GBH CPAs, PC, in Houston, Texas,
expressed substantial doubt about Blast Energy Services' ability
to continue as a going concern. The independent auditors noted
that Blast incurred a loss from continuing operations for 2011,
and has an accumulated deficit at Dec. 31, 2011.
The Company reported a net loss of $4.14 million for 2011,
compared with a net loss of $1.51 million for 2010.
The Company's balance sheet at March 31, 2012, showed $1.86
million in total assets, $3.98 million in total liabilities and a
$2.11 million total stockholders' deficit.
BNC FRANCES: Amends Schedules of Assets and Liabilities
-------------------------------------------------------
BNC Frances Villas, LP, filed with the U.S. Bankruptcy Court for
the Northern District of Texas its amended schedules of assets and
liabilities. As reported by the Troubled Company Reporter on
April 25, 2012, the Debtor disclosed $11,072,048 in total assets
and $9,292,375 in total liabilities. In the amended schedules
filed on July 11, 2012, the Debtor disclosed:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $11,000,000
B. Personal Property $121,763
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $8,600,000
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $692,375
----------- -----------
TOTAL $11,121,763 $9,292,375
A full text copy of the company's schedules of assets and
liabilities is available free at:
http://bankrupt.com/misc/BNC_FRANCES_sal.pdf
About BNC Frances
BNC Frances Villas, L.P., filed a bare-bones Chapter 11 petition
(Barnk. N.D. Tex. Case No. 12-32154) in its home-town in Dallas on
April 2, 2012, to halt a foreclosure sale of its property. BNC
owns and operates the Frances Way Villas Apartments in Richardson,
Texas. BNC, a Single Asset Real Estate as defined in 11 U.S.C.
Sec. 101 (51B). Judge Barbara J. Houser presides over the case.
Eric A. Liepins, P.C., serves as the Debtor's counsel.
BUTTERMILK TOWNE CENTER: To Distribute Remaining Carve-Out
----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Kentucky
approved an amended motion to make distributions in connection
with dismissal of Buttermilk Towne Center, LLC's case.
The Debtor is directed to distribute the remaining carve-out. The
Debtor will first pay administrative expenses and then distribute
the net carve-out, pro rata. If any funds remain in the Debtor's
estate or are unclaimed 90 days after the Debtor issues checks,
the Debtor is authorized and directed to turn over such funds to
Bank of America, N.A.
The Debtor has filed an amendment to its May 29, 2012 motion to
take into account the administrative expenses and to reduce the
distributions. The Debtor explained that the original motion did
not take into account certain administrative expenses which have
been and will be incurred by the Debtor in connection with the
process contemplated by the distribution motion and the closing of
the Chapter 11 case.
About Buttermilk Towne Center
Cincinnati, Ohio-based Buttermilk Towne Center, LLC, owns and
operates a commercial real estate development, known as Buttermilk
Towne Center, located in Crescent Springs, Kenton County,
Kentucky. The Company filed for Chapter 11 bankruptcy protection
(Bankr. E.D. Ky. Case No. 10-21162) on April 28, 2010. Timothy J.
Hurley, Esq., Paige Leigh Ellerman, Esq., and Beth A. Silvers,
Esq., at Taft Stettinius & Hollister LLP, serve as the Debtor's
counsel. The Company disclosed $28,999,954 in assets and
$41,085,856 in liabilities as of the Petition Date.
CAMBRIDGE HEART: Issues $267,500 Convertible Promissory Notes
-------------------------------------------------------------
On July 13, 2012, Cambridge Heart, Inc., entered into an Amendment
No. 2 to Subscription Agreement and Amendment No. 1 to Additional
Investment Rights. The Amendment amends those certain
Subscription Agreements entered into by the Company and the
subscribers, dated as of Jan. 17, 2012, Feb. 28, 2012, and May 23,
2012, and the Additional Investment Rights granted to the
subscribers pursuant to the Subscription Agreements.
The Amendment extended the termination date of the Additional
Investment Rights from July 15, 2012, to July 31, 2012. The
Amendment was approved by 65% of the holders of the outstanding
securities issued pursuant to the Subscription Agreements.
Pursuant to the exercise of certain AIR, on July 31, 2012, the
Company issued secured convertible promissory notes in the
aggregate principal amount of $267,500 together with common stock
warrants to purchase an aggregate of 2,431,817 shares of common
stock of the Company to certain accredited investors including
Roderick de Greef, the Chairman of the Board of the Company, and
two of the Company's largest shareholders. The Notes and related
common stock warrants have substantially the same terms as those
previously issued to investors under the Subscription Agreements,
except that all time effective or time triggered clauses and
provisions are determined from the issue date of the additional
Notes and warrants.
The exercise of the AIR provided $267,500 of gross proceeds, which
combined with the Company's current resource and projected
financial results, is expected to fund the Company's operations
into approximately October 2012. The securities were offered and
sold pursuant to an exemption from registration under Section 4(2)
of the Securities Act of 1933, as amended.
Reduction of Compensation
Roderick de Greef, the Company's Chairman of the Board, and Ali
Haghighi-Mood, the Company's Chief Executive Officer, each have
agreed to a temporary reduction in salary effective from Aug. 1,
2012, until Dec. 31, 2012. Specifically, Mr. de Greef will not be
paid any cash salary and Mr. Haghighi-Mood's salary will be
reduced by 50% during the Reduction Period. Both Mr. de Greef and
Mr. Haghighi-Mood will continue to participate in the Company's
health insurance and other benefit plans during the Reduction
Period.
The Company has agreed to pay to each of Mr. de Greef and Mr.
Haghighi-Mood an amount equal to the difference between the salary
payments that the executive would have been paid had he received
his unreduced salary during the period from Aug. 1, 2012, until a
Triggering Event and the amount that the executive is actually
paid by the Company during that period upon the occurrence of a
number of triggering events including the completion of one or
more financing transactions or strategic transactions that result
in the actual receipt by the Company of an amount equal to at
least the sum of (i) the outstanding principal amount of the
secured convertible promissory notes of the Company issued in the
Company's 2012 convertible note financing together with accrued
but unpaid interest for the entire term of the notes and (ii) the
aggregate of the Payment Amount payable to them together with any
similar payment amounts owed to other senior executives or
directors of the Company pursuant to agreements that are similar
in purpose, as well as other customary events including, without
limitation, a change in control of the Company or an event that
triggers the payment of severance to the executive under his
employment or severance agreement with the Company.
As of Aug. 2, 2012, 100,112,960 shares of the Company's common
stock were outstanding. On an as-converted basis, the Company has
124,659,416 shares of common stock issued and outstanding,
including 100,112,960 shares of common stock issued, 4,180,602
shares issuable upon conversion of the Series C-1 Convertible
Preferred Stock and 20,365,854 shares issuable upon conversion of
the Series D Convertible Preferred Stock.
About Cambridge Heart
Tewksbury, Mass.-based Cambridge Heart, Inc., is engaged in the
research, development and commercialization of products for the
non-invasive diagnosis of cardiac disease.
In its report on the financial statements for the year ended
Dec. 31, 2011, McGladrey & Pullen, LLP, in Boston, Massachusetts,
expressed substantial doubt about Cambridge Heart's ability to
continue as a going concern. The independent auditors noted that
of the Company's recurring losses, inability to generate positive
cash flows from operations, and liquidity uncertainties from
operations.
The Company reported a net loss of $5.40 million in 2011, compared
with a net loss of $5.17 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$2.54 million in total assets, $4.68 million in total liabilities,
$12.74 million in convertible preferred stock, and a
$14.89 million total stockholders' deficit.
CARRIAGE SERVICES: Credit Facility No Impact on Moody's 'B2' CFR
----------------------------------------------------------------
Moody's Investors Service said that Carriage Services, Inc.'s
recent announcement that it entered into a commitment letter for a
new 5-year senior secured $130 million term loan and $70 million
revolving credit facility is a credit positive because it improves
the company's debt maturity profile and expands the commitment
size of the revolving credit facility from a current size of $60
million. However, there is no impact on the company's B2 corporate
family rating and stable outlook because the proposed financing
does not materially change the company's credit profile.
The principal methodology used in rating Carriage was the Global
Business & Consumer Service Industry Rating 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.
Headquartered in Houston, Texas, Carriage Services, Inc. is a
provider of death care services in the United States. The company
reported sales of approximately $195 million for the twelve months
ended June 30, 2012.
CATALYST PAPER: Lowers Net Loss to $11.7-Mil. in Second Quarter
---------------------------------------------------------------
Catalyst Paper recorded a net loss of $11.7 million in the second
quarter of 2012, in comparison to a net loss of $25.6 million the
quarter before. Improvement in the current quarter was mainly due
to a gain on the sale of surplus-assets and a net reorganization
credit reflecting confirmed claim amounts. Before these and other
specific items, the net loss for the quarter was $5.0 million
compared to a net loss of $9.6 million in the prior quarter.
Earnings before interest, tax, depreciation and amortization
(EBITDA) in the second quarter was $14.6 million and EBITDA before
restructuring costs was $14.5 million, compared with EBITDA of
$18.1 million and EBITDA before restructuring costs of $23.3
million in the first quarter.
"We focused relentlessly on satisfying the requirements of the
reorganization process and it's gratifying to have gained creditor
approval of our second amended plan of arrangement," said Catalyst
President and CEO Kevin J. Clarke. "We reached that milestone
within five months of entering creditor protection and are now
poised for an orderly exit in the third quarter. While market
conditions are challenging, the benefit of reduced operating costs
and the 60% reduction in debt puts us on much better competitive
footing as our industry continues to reinvent for the future."
Catalyst filed for creditor protection on Jan. 31, 2012, and on
June 14, 2012, announced a second amended plan of arrangement.
This plan received the necessary creditor approval on June 25,
2012, and was subsequently approved by both the British Columbia
Supreme Court and by the United States Court in Delaware. Sale
and investor solicitation procedures relating to all or
substantially all of the company's assets - initiated when an
earlier version of the plan fell short of required levels of
creditor support - were suspended.
Creditor protection has been extended to Sept. 30, 2012, and
implementation of the approved plan of arrangement is conditional
on Catalyst securing a new asset-based loan facility and adequate
exit financing. Implementation of the plan is expected to reduce
annual operating costs by approximately $35 million, annual
interest expenses by US $34 to $42 million and will reduce long-
term debt by nearly US$400 million.
Despite extensive efforts to improve the financial performance of
the Company's Snowflake recycle paper mill in Arizona, the
decision to permanently close the facility effective Sept. 30,
2012, has been announced.
"With newsprint demand down more than 10% annually over the past
three years, ONP quality deterioration and higher freight costs as
procurement and sales were forced to go further afield to source
recycled paper supply and secure product orders, the mill's
profitability could simply not be restored going forward," Mr.
Clarke said. "I want to acknowledge and thank employees, unions
and public officials who provided unwavering support and
cooperation in our battle to overcome market challenges unique to
this operation."
Liquidity was up moderately over the prior quarter, although down
by $64.6 million from the same quarter last year. This was due to
reduced cash on hand, significant drawings on the Debtor in
Possession Facility and a credit agreement amendment during the
quarter requiring that excess availability of no less than $21.9
million be maintained on the DIP Facility.
A copy of the press release is available for free at:
http://is.gd/Bl8NqO
About Catalyst Paper
Catalyst Paper Corp. -- http://www.catalystpaper.com/--
manufactures diverse specialty mechanical printing papers,
newsprint and pulp. Its customers include retailers, publishers
and commercial printers in North America, Latin America, the
Pacific Rim and Europe. With four mills, located in British
Columbia and Arizona, Catalyst has a combined annual production
capacity of 1.9 million tons. The Company is headquartered in
Richmond, British Columbia, Canada and its common shares trade on
the Toronto Stock Exchange under the symbol CTL.
Catalyst on Dec. 15, 2011, deferred a US$21 million interest
payment on its outstanding 11.00% Senior Secured Notes due 2016
and Class B 11.00% Senior Secured Notes due 2016 due on Dec. 15,
2011. Catalyst said it was reviewing alternatives to address its
capital structures and it is currently in discussions with
noteholders. Perella Weinberg Partners served as the financial
advisor.
In early January 2012, Catalyst entered into a restructuring
agreement, which will see its bondholders taking control of the
company and includes an exchange of debt for equity. The
agreement said it would slash the company's debt by C$315.4
million ($311 million) and reduce its cash interest expenses.
Catalyst also said it will continue to "operate and satisfy" its
obligations to customers, trade creditors, employees and retirees
in the ordinary course of business during the restructuring
process.
On Jan. 17, 2012, Catalyst applied for and received an initial
court order under the Canada Business Corporations Act (CBCA) to
commence a consensual restructuring process with its noteholders.
Affiliate Catalyst Paper Holdings Inc., filed for creditor
protection under Chapter 15 of the U.S. Bankruptcy Code (Bankr. D.
Del. Case No. 12-10219) on the same day and sought recognition of
the Canadian proceedings.
Catalyst joins a line of paper producers that have succumbed to
higher costs, increased competition from Asia and Europe, and
falling demand as more advertisers and readers move online. In
2011, Cerberus Capital-backed NewPage Corp. filed for bankruptcy
protection, followed by SP Newsprint Co., owned by newsprint
magnate and fine art collector Peter Brant. In December, Wausau
Paper said it will close its Brokaw mill in Wisconsin, cut 450
jobs and exit its print and color business.
The Supreme Court of British Columbia granted Catalyst creditor
protection under the CCAA until April 30, 2012.
As of Dec. 31, 2011, the Company had C$737.6 million in total
assets and C$1.35 million in total liabilities.
As reported by the TCR on July 2, 2012, Catalyst received approval
for its reorganization plan from the Supreme Court of British
Columbia. The Company's second amended plan under the Companies'
Creditors Arrangement Act received 99% support from creditors.
CBS I LLC: Sec. 341 Creditors' Meeting Set for Aug. 9
-----------------------------------------------------
The U.S. Trustee for the District of Nevada will convene a Meeting
of Creditors pursuant to 11 U.S.C. Sec. 341(a) in the Chapter 11
case of CBS I, LLC, on Aug. 9, 2012, at 12:00 p.m. at 341s - Foley
Building, Room 1500.
About CBS
CBS I, LLC, filed for Chapter 11 protection (Bankr. D. Nev. Case
No. 12-16833) on June 7, 2012. The Debtor scheduled assets of
$19,356,448 and liabilities of $19,422,805. Judge Mike K.
Nakagawa presides over the case. Jeff Susa signed the petition as
manager.
The bankruptcy filing came after U.S. Bank, trustee for holders of
the $16.4 million mortgage, initiated foreclosure proceedings and
filed a lawsuit May 24 in Clark County District Court asking that
a receiver be appointed to take control of the Summerlin building
in Howard Hughes Plaza at 10100 West Charleston Blvd., just west
of Hualapai Way.
No request has been made for the appointment of a trustee or
examiner, and no official committees have yet been established in
the case.
CHEMTURA CORP: Rises Most Since Bankruptcy With Pesticides Boost
----------------------------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle, reports that Chemtura Corp. rose the most
since the chemical maker emerged from bankruptcy in 2010 after
sales of pesticides helped boost second-quarter profit more than
analysts had estimated. Chemtura climbed 15% to $14.95 at the
close in New York On Aug. 2.
The report relates the shares earlier rose as much as 19%, the
biggest gain since the Philadelphia-based company exited Chapter
11 bankruptcy protection in October 2010.
The report notes profit was 61 cents a share excluding costs
related to facility closures and other items, Chemtura said in an
Aug. 2 statement. That topped the 52-cent average estimate of
three analysts' estimates compiled by Bloomberg. Operating income
in the AgroSolutions business, which sells insecticides, weed
killers and seed treatments, almost doubled to $23 million.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 (Bankr. S.D.N.Y. Case No.
09-11233) on March 18, 2009. The Debtors disclosed total assets
of $3.06 billion and total debts of $1.02 billion as of the
Chapter 11 filing.
M. Natasha Labovitz, Esq., at Kirkland & Ellis LLP, in New York,
served as bankruptcy counsel for the Debtors. Wolfblock LLP was
the Debtors' special counsel. The Debtors' auditors and
accountant were KPMG LLP; their investment bankers are Lazard
Freres & Co.; their strategic communications advisors were Joele
Frank, Wilkinson Brimmer Katcher; their business advisors were
Alvarez & Marsal LLC and Ray Dombrowski served as their chief
restructuring officer; and their claims and noticing agent was
Kurtzman Carson Consultants LLC.
The Official Committee of Equity Security Holders tapped
Jay Goffman, Esq., and David Turetsky, Esq., at Skadden Arps Slate
Meagher & Flom LLP, in New York, as counsel. the Official
Committee of Unsecured Creditors retained Daniel H. Golden, Esq.,
Philip C. Dublin, Esq., and Meredith A. Lahaie, Esq., at Akin Gump
Strauss Hauer & Feld LLP, in New York, as counsel.
Chemtura completed its financial restructuring and emerged from
protection under Chapter 11 in November 2010. In connection with
the emergence, reorganized Chemtura is now listed on the New York
Stock Exchange under the ticker "CHMT".
CIRCLE ENTERTAINMENT: Files Form 10-Q; Incurs $2.2MM Loss in Q2
---------------------------------------------------------------
Circle Entertainment Inc. filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $2.25 million on $0 of revenue for the three months
ended June 30, 2012, compared with a net loss of $1.02 million on
$0 of revenue for the same period during the prior year.
The Company reported a net loss of $3.62 million on $0 of revenue
for the six months ended June 30, 2012, compared with a net loss
of $2.79 million on $0 of revenue for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $7 million in
total assets, $16.50 million in total liabilities and a $9.50
million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/TE7Fn6
About Cirle Entertainment
New York City-based Circle Entertainment Inc. has been pursuing
the development and commercialization of its new location-based
entertainment line of business since Sept. 10, 2010, which has and
will continue to require significant capital and financing. The
Company does not currently generate any revenues from this new
line of business. The Company has no long-term financing in place
or commitments for such financing to develop and commercialize its
new location-based entertainment line of business.
As reported in the TCR on March 30, 2012, L.L. Bradford & Company,
LLC, in Las Vegas, Nevada, expressed substantial doubt about
Circle Entertainment's ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company
has limited available cash, has a working capital deficiency and
will need to secure new financing or additional capital in order
to pay its obligations.
CIRCUS AND ELDORADO: Downey Brand OK'd as Nevada Counsel
--------------------------------------------------------
The Hon. Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada authorized Circus and Eldorado Joint Venture,
et al., to employ Downey Brand LLP as Nevada reorganization
counsel. The firm will charge the Debtor's estate on an hourly
basis. Partners at the firms will charge $375 to $410 per hour
and paralegals will charge $145 per hour.
About Circus and Eldorado
Circus and Eldorado Joint Venture and Silver Legacy Capital Corp.
filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case Nos. 12-51156
and 12-51157) on May 17, 2012.
Circus and Eldorado Joint Venture owns and operates the Silver
Legacy Resort Casino, a 19th century silver mining themed hotel,
casino and entertainment complex located in downtown Reno, Nevada.
The casino and entertainment areas at Silver Legacy are connected
by skyway corridors to the neighboring Eldorado Hotel & Casino and
the Circus Circus Hotel and Casino, each of which are owned by
affiliates of the Debtors. Together, the three properties
comprise the heart of the Reno market's prime gaming area and room
base.
Silver Legacy Capital is a wholly owned subsidiary of the Joint
Venture and was created and exists for the sole purpose of serving
as a co-issuer of the mortgage notes due 2012. SLCC has no
operations, assets or revenues.
Eldorado Hotel & Casino and Circus Circus Hotel and Casino are not
debtors in the Chapter 11 cases.
The Company did not make the required principal payment of its
10.125% mortgage notes on the maturity date of March 1, 2012. The
company also elected not to make the scheduled interest payment.
As a result, an aggregate of $142.8 million principal amount of
Notes were outstanding and accrued interest of $7.23 million on
the Notes, as of March 1, 2012, is due and payable.
The Debtors have entered into a Restructuring Support Agreement
with Capital Research and Management Company, a holder of a
substantial portion of the mortgage notes. A copy of the RSA
dated March 15, 2012, is available for free at http://is.gd/diDPh3
The RSA contemplates a proposed plan will be filed no later than
June 1, 2012. The plan will contain creditor treatments that
have already been negotiated with and agreed to by creditor
constituents. The Debtors will seek approval of the explanatory
disclosure statement within 45 days after the Petition Date and
obtain confirmation of the Plan 60 days later.
Judge Bruce T. Beesley presides over the case. Paul S. Aronzon,
Esq., and Thomas P. Kreller, Esq., at Milbank, Tweed, Hadley &
McCloy LLP; and Sallie B. Armstrong, Esq., at Downey Brand LLP,
serve as the Debtors' counsel. The Debtors' financial advisor is
FTI Consulting Inc. The claims agent is Kurtzman Carson
Consultants LLC.
The Bank of New York Mellon Trust Company, N.A., the trustee for
the Debtors' 10-1/8% Mortgage Notes due 2012, is represented by
Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
Circus and Eldorado Joint Venture disclosed $264,649,800 in assets
and $158,753,490 in liabilities as of the Chapter 11 filing.
The petitions were signed by Stephanie D. Lepori, chief financial
officer.
The Plan dated June 1, 2012, pays much of its debt in cash and the
balance with new secured liens.
August B. Landis, Acting U.S. Trustee for Region 17, appointed
three creditors to serve in the Official Committee of Unsecured
Creditors in the Debtors' Chapter 11 cases. Stutman, Treister &
Glatt Professional Corporation represents the Committee.
CIRCUS AND ELDORADO: Sept. 13 Hearing on Plan Confirmation
----------------------------------------------------------
The Hon. Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada will convene a hearing on Sept. 13, 2012, at
9:30 a.m. to consider the confirmation of Circus and Eldorado
Joint Venture. et al.'s First Amended Plan of Reorganization dated
June 1, 2012, as amended. Objections, if any, are due Aug. 28, at
4 p.m.
The deadline for the Debtors to file their confirmation brief in
support of the Plan, any reply or replies to objections to
confirmation, their tabulation report, and any objections to any
claim for voting purposes, and any related documents or pleadings
will be Sept. 7, at 4 p.m.
Ballots accepting or rejecting the Plan are due 4 p.m. on
Aug. 28. Ballots must be submitted to:
Kurtzman Carson Consultants LLC
Attn: Circus and Eldorado Joint Venture
Ballot Processing
599 Lexington Avenue, 39th Floor
New York, NY 10022
The Court has approved the Disclosure Statement as containing
adequate information of the terms and consequences of the Plan.
As reported in the July 12, edition of the TCR, according to the
Disclosure Statement, creditors and interest holders will be
treated as follows:
Class Claims/Interest Treatment
----- --------------- ---------
1 Other Secured Claims Paid in full in Cash or
otherwise left Unimpaired
2 Other Priority Claims Paid in full in Cash or
otherwise left Unimpaired
3 Mortgage Note Claims If Class 3 Acceptance
occurs, each holder will
receive its respective Pro
Rata share of (i) the Class 3
Consensual Cash Distribution
and (ii) the New Second Lien
Notes.
If Class 3 Acceptance does
not occur, each holder will
receive its pro rata share of
(i) the Class 3 Cram-Down Cash
Distribution and (ii) the
Cram-Down Notes.
4 US Foods Secured Claims Paid in full in Cash, but no
payment of accrued interest on
the Allowed US Foods Secured
Claim
5 General Unsecured Claims Paid in full in Cash in four
equal quarterly installments,
the last of which will occur no
later than one year after the
Effective Date, with interest
accruing at a rate of 5% per
annum from the Petition Date
through the date that the
Allowed General Unsecured Claim
is paid in full, provided that,
in the event that any
distribution to be made to
a Holder of an Allowed
General Unsecured Claim
(on account of the principal
amount of such Allowed General
Unsecured Claims) in the
aggregate totals less than
$15,000, the Debtors, the
Reorganized Debtors, and
the Disbursing Agent, as
applicable, will make
any distribution in a
single lump sum on the
Effective Date, without
interest.
6 Equity Interests Rights remain unaltered by
the Plan.
A copy of the Amended Disclosure Statement is available for free
at http://bankrupt.com/misc/CIRCUS_ds_1amended.pdf
About Circus and Eldorado
Circus and Eldorado Joint Venture and Silver Legacy Capital Corp.
filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case Nos. 12-51156
and 12-51157) on May 17, 2012.
Circus and Eldorado Joint Venture owns and operates the Silver
Legacy Resort Casino, a 19th century silver mining themed hotel,
casino and entertainment complex located in downtown Reno, Nevada.
The casino and entertainment areas at Silver Legacy are connected
by skyway corridors to the neighboring Eldorado Hotel & Casino and
the Circus Circus Hotel and Casino, each of which are owned by
affiliates of the Debtors. Together, the three properties
comprise the heart of the Reno market's prime gaming area and room
base.
Silver Legacy Capital is a wholly owned subsidiary of the Joint
Venture and was created and exists for the sole purpose of serving
as a co-issuer of the mortgage notes due 2012. SLCC has no
operations, assets or revenues.
Eldorado Hotel & Casino and Circus Circus Hotel and Casino are not
debtors in the Chapter 11 cases.
The Company did not make the required principal payment of its
10.125% mortgage notes on the maturity date of March 1, 2012. The
company also elected not to make the scheduled interest payment.
As a result, an aggregate of $142.8 million principal amount of
Notes were outstanding and accrued interest of $7.23 million on
the Notes, as of March 1, 2012, is due and payable.
The Debtors have entered into a Restructuring Support Agreement
with Capital Research and Management Company, a holder of a
substantial portion of the mortgage notes. A copy of the RSA
dated March 15, 2012, is available for free at http://is.gd/diDPh3
The RSA contemplates a proposed plan will be filed no later than
June 1, 2012. The plan will contain creditor treatments that
have already been negotiated with and agreed to by creditor
constituents. The Debtors will seek approval of the explanatory
disclosure statement within 45 days after the Petition Date and
obtain confirmation of the Plan 60 days later.
Judge Bruce T. Beesley presides over the case. Paul S. Aronzon,
Esq., and Thomas P. Kreller, Esq., at Milbank, Tweed, Hadley &
McCloy LLP; and Sallie B. Armstrong, Esq., at Downey Brand LLP,
serve as the Debtors' counsel. The Debtors' financial advisor is
FTI Consulting Inc. The claims agent is Kurtzman Carson
Consultants LLC.
The Bank of New York Mellon Trust Company, N.A., the trustee for
the Debtors' 10-1/8% Mortgage Notes due 2012, is represented by
Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
Circus and Eldorado Joint Venture disclosed $264,649,800 in assets
and $158,753,490 in liabilities as of the Chapter 11 filing.
The petitions were signed by Stephanie D. Lepori, chief financial
officer.
The Plan dated June 1, 2012, pays much of its debt in cash and the
balance with new secured liens.
August B. Landis, Acting U.S. Trustee for Region 17, appointed
three creditors to serve in the Official Committee of Unsecured
Creditors in the Debtors' Chapter 11 cases. Stutman, Treister &
Glatt Professional Corporation represents the Committee.
CLARE AT WATER TOWER: Bondholders Get 17 Cents on Dollar
--------------------------------------------------------
Darrell Preston at Bloomberg News reports that after the 53-story
Clare at Water Tower entered bankruptcy last year, the court doled
out about 17 cents on the dollar, on average, for $233 million of
debt, records show. According to the report, in the $3.7 trillion
muni market in 2011, the default trailed only those triggered by
AMR Corp.'s bankruptcy, said John Hallacy, muni research head at
Bank of America Merrill Lynch in New York. Fundamental Advisors
LP, a private-equity firm, led a partnership that bought the tower
at auction for $53.5 million. Now retiree apartments, once listed
at $1 million, are offered for $595,000.
About The Clare at Water Tower
The Clare at Water Tower is an upscale 334-unit high-rise
continuing-care retirement community in Chicago, Illinois. The
project is only 42% occupied because the target population either
hasn't been able to sell homes or lacks sufficient cash to make
required deposits as the result declining investments following
the recession. The facility is a 53-story building on land rented
from Loyola University of Chicago. The facility is managed and
developed by a unit of the Franciscan Sisters of Chicago, who
invested more than $14 million. The project opened in December
2008. Residents must make partially refundable deposits ranging
from $263,000 to $1.2 million. Monthly fees are an additional
$2,700 to $5,500.
The Clare filed for Chapter 11 protection (Bankr. N.D. Ill. Case
No. 11-46151) on Nov. 14, 2011, after defaulting on $229 million
in tax-exempt bond financing used to build the project.
Judge Susan Pierson Sonderby presides over the case. Matthew M.
Murphy, Esq., at DLA Piper LLP, serves as the Debtor's counsel.
Houlihan Lokey Capital, Inc., as its investment banker and
financial advisor. Deloitte Financial Advisory Services LLP
serves as restructuring advisor. Epiq Bankruptcy Solutions serves
as claims and noticing agent. The Debtor, in its amended
schedules, disclosed $56.8 million in assets and $321.7 million in
liabilities. The petition was signed by Judy Amiano, president.
The Official Committee of Unsecured Creditors proposed to retain
SNR Denton US LLP as counsel. The Committee also tapped FTI
Consulting, Inc., as its financial advisor.
Clare at Water Tower's reorganization plan was declared effective
July 2, 2012.
COCOPAH NURSERIES: Sec. 341 Creditors' Meeting This Friday
----------------------------------------------------------
The U.S. Trustee for the District of Arizona will convene a
Meeting of Creditors pursuant to 11 U.S.C. Sec. 341(a) in the
Chapter 11 case of Cocopah Nurseries, Inc., on Aug. 10, 2012, at
10:00 a.m. at the U.S. District Court Building, 325 West 19th St.,
Yuma, Arizona.
About Cocopah Nurseries
Cocopah Nurseries of Arizona, Inc., and three affiliates sought
Chapter 11 protection (Bankr. D. Ariz. Lead Case No. 12-15292) on
July 9, 2012. The affiliates are Wm. D. Young & Sons, Inc.;
Cocopah Nurseries, Inc.; and William Dale Young & Sons Trucking
and Nursery.
Cocopah Nurseries is a Young-family owned agricultural enterprise
with operations in Arizona and California. The core business
involves the cultivation of palm trees and other trees used for
landscaping purposes, as well as the associated farming of citrus,
dates, and other crops. The Debtors presently own more than
250,000 palm trees in various stages of the tree-growth cycle.
Cocopah has 250 full-time salaried employees, and taps an
additional 50 to 250 contract laborers depending on the season.
Revenue in 2010 was $23 million, down from $57 million in 2006.
Judge Eileen W. Hollowell presides over the case. The Debtors'
counsel are Craig D. Hansen, Esq., and Bradley A. Cosman, Esq., at
Squire Sanders (US) LLP.
Cocopah Nurseries of Arizona estimated $10 million to $50 million
in assets and $100 million to $500 million in debts. The
petitions were signed by Darl E. Young, authorized representative.
Attorneys for Rabobank, N.A., are Robbin L. Itkin, Esq., and Emily
C. Ma, Esq., at Steptoe & Johnson LLP, and S. Cary Forrester,
Esq., at Forrester & Worth, PLLC.
Non-debtor affiliate Jewel Date Company, Inc., is represented by
Michael W. Carmel, Ltd., as counsel.
COMARCO INC: Neal Bradsher Discloses 35.1% Equity Stake
-------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Neal C. Bradsher and his affiliates disclosed
that, as of July 27, 2012, they beneficially own 3,268,682 shares
of common stock of Comarco, Inc., representing 35.09% of the
shares outstanding. A copy of the filing is available at:
http://is.gd/TJzrd7
About Comarco Inc.
Based in Lake Forest, California, Comarco, Inc. (OTC: CMRO)
-- http://www.comarco.com/-- is a provider of innovative,
patented mobile power solutions that can be used to power and
charge notebook computers, mobile phones, and many other
rechargeable mobile devices with a single device.
Comarco reported a net loss of $5.31 million for the year ended
Jan. 31, 2012, compared with a net loss of $5.97 million during
the prior year.
After auditing the fiscal 2012 financial results, Squar, Milner,
Peterson, Miranda & Williamson, LLP, in Newport Beach, California,
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 and negative cashflow
from operations, has had declining working capital and
uncertainties surrounding the Company's ability to raise
additional funds.
The Company's balance sheet at April 30, 2012, showed $4.88
million in total assets, $6.89 million in total liabilities and a
$2.01 million total stockholders' deficit.
COMDISCO HOLDING: Has $629,000 Net Loss in June 30 Quarter
----------------------------------------------------------
Comdisco Holding Company, Inc., reported the financial results for
its fiscal third quarter ended June 30, 2012. Comdisco emerged
from Chapter 11 bankruptcy proceedings on Aug. 12, 2002, and under
its Plan of Reorganization, its business purpose is limited to the
orderly sale or run-off of all its remaining assets.
For the quarter ended June 30, 2012, Comdisco reported a net loss
of $629,000, or $0.16 per common share. The net loss was driven
in large part by the selling, general and administrative expenses
of the estate during the quarter ended June 30, 2012. The per
share results for Comdisco were based on 4,028,951 shares of
common stock outstanding on June 30, 2012.
For the quarter ended June 30, 2012, total revenue was $31,000 as
compared to $867,000 for the quarter ended June 30, 2011. The
decrease was primarily the result of no equity investment gains in
the current quarter.
There was equity investment gains of $843,000 in the quarter ended
June 30, 2011. Net cash used in operating activities was
approximately $1,114,000 for the nine months ended June 30, 2012
as a result of selling, general and administrative expenses,
partially offset by bad debt recoveries and equity proceeds.
The net cash used in operating activities of approximately
$8,692,000 for the nine months ended June 30, 2011 was primarily
the result of a contingent distribution rights payment and
selling, general and administrative expenses.
Total assets were approximately $39,866,000 as of June 30, 2012,
including approximately $32,634,000 of unrestricted cash and
short-term investments, compared to total assets of approximately
$39,973,000 as of September 30, 2011, including approximately
$33,878,000 of unrestricted cash and short-term investments. The
decrease in cash was primarily a result of selling, general and
administrative expenses paid during the nine months ended June 30,
2012.
As a result of bankruptcy restructuring transactions, the adoption
of fresh-start reporting and multiple asset sales, Comdisco's
financial results are not comparable to those of its predecessor
company, Comdisco, Inc. Please refer to Comdisco's quarterly
report on Form 10-Q filed with the Securities and Exchange
Commission on Aug. 6, 2012 for complete financial statements and
other important disclosures.
About Comdisco
Comdisco filed for chapter 11 protection on July 16, 2001 (Bankr.
N.D. Ill. Case No. 01-24795), and emerged from chapter 11
bankruptcy proceedings on August 12, 2002. John Wm. "Jack" Butler,
Jr., Esq., Charles W. Mulaney, Esq., George N. Panagakis, Esq.,
Gary P. Cullen, Esq., N. Lynn Heistand, Esq., Seth E. Jacobson,
Esq., Andre LeDuc, Esq., Christina M. Tchen, Esq., L. Byron Vance,
III, Esq., Marian P. Wexler, Esq., and Felicia Gerber Perlman,
Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented
Comdisco. Evan D. Flaschen, Esq., and Anthony J. Smits, Esq., at
Bingham Dana LLP, now Bingham McCutchen, served as Comdisco's
International Counsel.
The purpose of reorganized Comdisco is to sell, collect or
otherwise reduce to money in an orderly manner the remaining
assets of the corporation. Pursuant to the Plan and restrictions
contained in its certificate of incorporation, Comdisco is
specifically prohibited from engaging in any business activities
inconsistent with its limited business purpose. Accordingly,
within the next few years, it is anticipated that Comdisco will
have reduced all of its assets to cash and made distributions of
all available cash to holders of its common stock and contingent
distribution rights in the manner and priorities set forth in the
Plan. At that point, the company will cease operations. The
company filed on August 12, 2004 a Certificate of Dissolution with
the Secretary of State of the State of Delaware to formally
extinguish Comdisco Holding Company, Inc.'s corporate existence
with the State of Delaware except for the purpose of completing
the wind-down contemplated by the Plan.
COMMERCIAL FINANCIAL: Files for Chapter 11 Bankruptcy Protection
----------------------------------------------------------------
Philly.com, citing court documents, notes that Commerce Financial
Corp. at 1999 Marlton Pike East, Suite 6, Cherry Hill, New Jersey,
filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy
Court for the District of New Jersey, listing $0 in assets, and
$926,750 in liabilities.
CONSTELLATION BRANDS: Moody's Rates $650Mm Notes Offering 'Ba1'
---------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to Constellation
Brands, Inc.'s $650 million 10 1/2 year note offering. Proceeds
will be used for general corporate purposes and to pre-fund the
previously announced purchase of the remaining 50% of the Crown JV
currently owned by Modelo. Moody's also assigned a (P) Ba1 rating
for senior unsecured drawings under the company's latest shelf.
The rating outlook is stable.
Ratings Rationale
Constellation's Ba1 rating reflects its meaningful scale and good
product diversification, including an extensive portfolio of
brands covering the premium wine, spirits and imported beer
categories. The rating also reflects the franchise strength,
efficiency, and solid profitability of the company. The company's
presence in premium wines, vodka and imported beer places it in
some of the categories that are most strongly positioned for
growth within their respective segments.
Moody's believes that the Crown and Mark West acquisitions
announced in June, which will total approximately $2 billion in
aggregate, are both positives for the company, although leverage
will temporarily spike up beyond the range that is comfortable for
the current rating level. The full ownership of the Crown Joint
Venture will provide better transparency in financial results
since the business will be consolidated rather than accounted for
under the equity method. Importantly it gives Constellation better
certainty concerning the future of the Crown business. The
agreement is perpetual with rolling 10 year terms, with limited
buyout/ call rights at a premium and no performance thresholds,
whereas under the existing arrangement, Modelo had a right to
terminate the agreement (after 10 years with advanced notice at
year 7) and purchase Constellation's stake in the joint venture
without significant limitations and with less favorable economic
compensation to Constellation. Constellation will become solely
responsible for marketing, pricing, promotion, distribution, new
product development and innovation of the Crown Brands, and other
non-Mexican brands it might choose to introduce, while AB InBev
will ensure continuity of supply and product quality and will be
able to introduce innovations. In addition, the usual integration
risks associated with most acquisitions are not present here given
Constellation's existing involvement in Crown's operations.
The following ratings were assigned
Senior unsecured shelf at (P) Ba1
$650 million Senior unsecured note maturing March 2023 at Ba1;
LGD4; 51%
The stable outlook reflects Moody's view that Constellation Brands
will continue to be profitable, with EBITA margins in the low to
mid 20% range per Moody's calculations (this range reflects a
margin expectation based on now fully consolidating Crown results
that were previously reported under equity method of accounting).
The principal methodology used in rating Constellation Brands was
Global Alcoholic Beverage Rating Methodology published in August
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.
Headquartered in Victor, New York, Constellation Brands, Inc.
("Constellation", or "STZ") is a leading international wine
company with a broad portfolio of premium brands across the wine,
spirits, and imported beer categories. Major brands in the
company's portfolio include Robert Mondavi, Clos du Bois,
Ravenswood, Blackstone, Nobilo, Kim Crawford, Inniskillin,
Jackson-Triggs, Arbor Mist, Black Velvet Canadian Whisky, and
SVEDKA vodka. It imports Corona through the Crown Imports Joint
Venture.
CONSTELLATION BRANDS: S&P Rates New $650MM Sr. Unsec. Notes 'BB+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' issue-level
and '3' recovery ratings to Constellation Brands Inc.'s proposed
$650 million senior unsecured notes due 2023. "The '3' recovery
rating indicates our expectation of meaningful recovery (50%-70%)
in the event of payment default. The notes will be issued under
the company's Rule 415 shelf registration. Constellation Brands
has indicated that it plans to use the net proceeds from this
offering to partially pre-fund its pending acquisition of the
remaining 50% interest in Crown Imports LLC (not rated). The
proceeds from the offering will be held in escrow until the
proposed acquisition is completed, assuming it's completed as
currently described. As such, we will net the cash held in escrow
against debt in the interim until the acquisition is completed,"
S&P said.
"Our corporate credit rating on Constellation Brands reflects our
assessment of the company's 'satisfactory' business risk profile
and 'significant' financial risk profile. Key credit factors
considered in our business risk assessment include the company's
diverse portfolio of consumer brands and historically strong cash
generation in the highly competitive beverage alcohol markets, yet
relatively narrow business and geographic focus. Our financial
risk profile incorporates Constellation Brands' moderate financial
policy, adequate liquidity, and key credit measures that we
believe will remain within or near indicative ratio ranges for a
significant financial profile, including leverage (as measured by
total debt to EBITDA) of 3x-4x. Pro forma for the proposed Crown
transaction, we estimate key credit ratios (including our standard
adjustments) will weaken from fiscal 2012 year-end levels.
Specifically, in our view, total debt to EBITDA will be 4.6x but
will improve to near 4x within one year of closing of the Crown
transaction because we expect that Constellation Brands will
forego shareholder-friendly initiatives and apply discretionary
cash flow to debt in the intermediate term," S&P said.
RATINGS LIST
Constellation Brands Inc.
Corporate Credit Rating BB+/Stable/--
New Rating
Constellation Brands Inc.
$650 mil. sr unsecd notes due 2023 BB+
Recovery Rating 3
CONTRACT RESEARCH: Has Until Nov. 21 to Propose Ch. 11 Plan
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
Contract Research Solutions, Inc., et al.'s exclusive periods to
file and solicit acceptances for the proposed Chapter 11 Plan
until Nov. 21, 2012, and Jan. 20, 2013, respectively.
The Debtors said in the motion that allowing other parties to
propose competing plans could potentially undo their progress
relating to the Global Settlement with the prepetition secured
lenders and the Committee in support of the sale and providing for
the orderly wind down.
The Debtor completed the sale of its assets to an investor group,
led by Freeport Financial, on June 20.
About Cetero
Contract Research Solutions Inc., doing business as Cetero, a
provider of early-phase clinical research services for
pharmaceutical and biotechnology firms, filed a Chapter 11
petition (Bankr. D. Del. Case No. 12-11004) on March 26, 2012.
Cetero's 19 affiliates also sought bankruptcy protection (Bankr.
D. Del. Case Nos. 12-11005 to 12-11023).
Cetero plans to sell the business, including their rights to
pursue avoidance actions, to first-lien secured lenders in
exchange for $50 million in debt, absent higher and better offers.
Cetero has filed a motion seeking approval of procedures that will
govern the bidding and auction. The first-lien lenders have
formed entities that will acquire the business -- CSRI Holdings
LLC, as U.S. Purchaser, and 0935867 B.C. Ltd and 0935870 B.C. Ltd,
as Canadian Purchasers. Together, they will serve as stalking
horse bidders and have offered to exchange $50 million in secured
debt and assume $30 million in liabilities to buy the assets.
First lien lenders are also providing a $15 million loan to
finance the Chapter 11 effort.
Assets are $205 million, with debt total $248 million. There is
$185 million in debt for borrowed money, including $116 million on
a first-lien term loan and revolving credit. The second-lien loan
is $25 million. Second-lien lenders have agreed to the sale.
Freeport Financial LLC serves as the sole lead arranger and
bookrunner, and as U.S. administrative agent and collateral agent
under the first lien facility. Bank of Montreal serves as the
Canadian agent. Freeport is also the agent under the second lien
facility.
Judge Kevin Gross oversees the case. Lawyers at Young Conaway
Stargatt & Taylor, LLP, and Paul Hastings LLP serve as the
Debtors' counsel. Stikeman Elliott LLP serves as Canadian
counsel. Carl Marks Advisory Group LLC serves as restructuring
advisor. Epiq Bankruptcy Solutions serves as claims and notice
agent. The petitions were signed by Michael T. Murren, CFO.
The first lien lenders and the stalking horse buyers are
represented by Peter Knight, Esq., at Latham & Watkings, LLP; and
Wael Rostom, Esq., at McMillan LLP.
Roberta A. Deangelis, U.S. Trustee for Region 3 appointed three
persons to the Official Committee of Unsecured Creditors in the
Chapter 11 cases of Contract Research.
DAYTOP VILLAGE: Court Sets Sept. 4 as Claims Bar Date
-----------------------------------------------------
The Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York has granted Daytop Village
Foundation Incorporated, et al.'s motion setting Sept. 4, 2012,
4:00 p.m. (prevailing Eastern time) as the last date for creditors
other than governmental entities to to file a proof of claim
against any of the Debtors. Governmental entities are given until
Oct. 2, 2012, at 4:00 p.m. (prevailing Eastern time) to file a
proof of claim against any of the Debtors.
Proofs of claims must be submitted to the claims agent:
a. if by first class mail:
Daytop Village Foundation Incorporated
Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
FDR Station, P.O. Box 5112
New York, NY 10150-5112
b. if by hand delivery or overnight mail:
Daytop Village Foundation Incorporated
Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
757 Third Avenue, 3rd Floor
New York, NY 10017
About Daytop Village
Daytop Village Foundation Incorporated, along with affiliate
Daytop Village Inc., filed a Chapter 11 petition (Bankr. S.D.N.Y.
Case No. 12-11436) on April 5, 2012, in Manhattan.
In 1963, Father William O'Brien and Dr. Alexander Bassin founded
the Daytop Lodge, a substance abuse treatment facility, in Staten
Island. Today, Daytop is the third largest substance abuse agency
operating in the State of New York and the only substance abuse
agency operating world-wide under a contract with the Unites
States State Department. It provides family-oriented substance
abuse treatment for adults and adolescents. Through six
residential facilities and eight outreach clinics in New York,
Daytop offers individual treatment plans by providing professional
counseling, medical, social and spiritual attention.
Judge Shelley C. Chapman presides over the Chapter 11 cases.
Lowenstein Sandler PC is the Debtors' counsel. Epiq Bankruptcy
Solutions, LLC, is the claims and notice agent. The Debtors'
Restructuring and Management Officer is Marotta Gund Budd Dezera
LLC. The petition was signed by Michael Dailey, chief executive
officer.
Daytop Village Inc., as of Jan. 31, 2012 has $8.68 million in
assets and $45.03 million of liabilities. DVF has $42.20 million
in assets and $32.00 million in liabilities as of Jan. 31, 2012.
Island Funding II, the DIP lender, is represented by Paul R.
DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP. Counsel to the
prepetition lender Signature Bank is Stephen D. Brodie, Esq., at
Herrick Feinstein LLP; and Joshua I. Divack, Esq., at Hahn &
Hessen LLP. Counsel to the prepetition lender Hudson Valley Bank
is James P. Blose, Esq., at Griffin Coogan Blose & Sulzer P.C.
DBSI INC: Judge Nixes Bid to Name Trustee in Racketeering Case
--------------------------------------------------------------
Lance Duroni at Bankruptcy Law360 reports that a Delaware
bankruptcy judge on Thursday quashed Wavetronix LLC's bid to go
after the liquidating trustee for DBSI Inc. in a federal
racketeering suit, finding that the defunct real estate investment
firm's Chapter 11 plan barred the claims.
Bankruptcy Law360 relates that Wavetronix received more than
$21 million in funding from DBSI before DBSI sought court
protection in Delaware, where a bankruptcy examiner subsequently
concluded that DBSI management had conducted a massive Ponzi
scheme that defrauded investors of some $500 million.
About DBSI Inc.
Headquartered in Meridian, Idaho, DBSI Inc. and its affiliates
were engaged in numerous commercial real estate and non-real
estate projects and businesses. On Nov. 10, 2008, and other
subsequent dates, DBSI and 180 of its affiliates filed for
Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-12687).
DBSI estimated assets and debts between $100 million and
$500 million as of the Chapter 11 filing.
Lawyers at Young Conaway Stargatt & Taylor LLP represent the
Debtors as counsel. The Official Committee of Unsecured Creditors
tapped Greenberg Traurig, LLP, as its bankruptcy counsel.
Kurtzman Carson Consultants LLC is the Debtors' notice claims and
balloting agent.
Joshua Hochberg, a former head of the Justice Department fraud
unit, served as an Examiner and called the seller and servicer of
fractional interests in commercial real estate an "elaborate shell
game" that "consistently operated at a loss" in his report
released in October 2009. McKenna Long & Aldridge LLP was counsel
to the Examiner.
On Sept. 11, 2009, the Honorable Peter J. Walsh entered an Order
appointing James R. Zazzali as Chapter 11 trustee for the Debtors'
estates. On Oct. 26, 2010, the trustee of DBSI Inc. won court
confirmation of its Chapter 11 plan of liquidation, paving the way
for it to pay creditors and avoid years of expensive litigation
over its complex web of affiliates. The plan, which was declared
effective Oct. 29, 2010, was jointly proposed by DBSI's unsecured
creditors and the bankruptcy trustee in charge of DBSI and its
170-plus affiliates.
Pursuant to DBSI Inc.'s confirmed Chapter 11 plan, the DBSI Real
Estate Liquidating Trust was established as of the effective date
and certain of the Debtors' assets, including the Debtors'
ownership interest in Florissant Market Place was transferred to
the RE Trust. Mr. Zazzali and Conrad Myers were appointed as the
post-confirmation trustees. Messrs. Zazzali and Myers are
represented by lawyers at Blank Rime LLP and Gibbons P.C.
DCB FINANCIAL: Posts $283,00 Net Income in Second Quarter
---------------------------------------------------------
DCB Financial Corp. reported net income $283,000 on $4.72 million
of total interest income for the three months ended June 30, 2012,
compared with a net loss of $1.85 million on $5.77 million of
total interest income for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $510.70
million in total assets, $475.51 million in total liabilities and
$35.19 million in total shareholders' equity.
"We are pleased with the progress that we have been making," noted
Ronald J. Seiffert, president and chief executive officer. "We
continue to make significant improvements in our loan quality and
our financial results over the past year are a testament to that
progress and hard work."
A copy of the press release is available for free at:
http://is.gd/KGo5kx
About DCB Financial
DCB Financial Corp. is a financial holding company headquartered
in Lewis Center, Ohio. The Corporation has one wholly-owned
subsidiary bank, The Delaware County Bank and Trust Company (the
"Bank"). The Corporation also has two additional wholly owned
subsidiaries, DCB Title and DCB Insurance Services LLC. DCB Title
provides standard real estate title services, while DCB Insurance
Services LLC provides a variety of insurance products. However,
neither nonbank subsidiary is material to the financial results of
the Corporation. The Bank has one wholly-owned subsidiary, ORECO,
which is used to process other real estate owned.
The Corporation was incorporated under the laws of the State of
Ohio in 1997, as a financial holding company under the Bank
Holding Company Act of 1956, as amended, by acquiring all
outstanding shares of the Bank. The Corporation acquired all such
shares of the Bank after an interim bank merger, consummated on
March 14, 1997. The Bank is a commercial bank, chartered under
the laws of the State of Ohio, and was organized in 1950.
The Bank provides customary retail and commercial banking services
to its customers, including checking and savings accounts, time
deposits, IRAs, safe deposit facilities, personal loans,
commercial loans, real estate mortgage loans, installment loans,
trust and other wealth management services. The Bank also
provides cash management, bond registrar and paying agent services
for commercial and public unit entities. Through its subsidiary
Datatasx, the Bank provided data processing and other bank
operational services to other financial institutions. Those
services were discontinued in September 2011, and were not a
significant part of operations or revenue.
In October 2010, the Corporation's wholly-owned bank subsidiary
entered into a Consent Agreement with the FDIC which requires that
Tier-1 and Total Risk Based Capital percentages reach 9.0% and
13.0% respectively. As of March 31, 2012, the Bank's capital
ratios, as previously noted, were not at these levels.
The Corporation and its subsidiaries meet all published regulatory
capital requirements. The ratio of total capital to risk-weighted
assets was 10.3% at March 31, 2012, while the Tier 1 risk-based
capital ratio was 6.7%.
As reported in the TCR on April 5, 2012, Plante & Moran PLLC, in
Columbus, Ohio, said DCB's bank subsidiary is not in compliance
with revised minimum regulatory capital requirements under a
formal regulatory agreement with the banking regulators. "Failure
to comply with the regulatory agreement may result in additional
regulatory enforcement actions."
DELTA PETROLEUM: FTI Approved as Committee's Advisor
----------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Official Committee of Unsecured Creditors in the Chapter 11
cases of Delta Petroleum Corporation, et al., to retain FTI
Consulting, Inc. as financial advisor.
The Court also ordered that FTI's fees and expenses until Aug. 31,
2012, must not exceed $250,000 in the aggregate, provided that the
Committee may file a motion seeking to increase the fee cap if a
plan of reorganization is not consummated by Aug. 31, 2012, or on
account of other changed circumstances subject to all parties'
rights to oppose any such motion.
As reported in the Troubled Company Reporter on July 24, 2012, FTI
will provide financial advisory services, including but not
limited to:
-- assistance in the review and monitoring of the asset sale
process, including, but not limited to an assessment of the
adequacy of the marketing process, completeness of any buyer
lists, review and quantifications of any bids;
-- assistance in the review of financial information prepared
by the Debtors, including, but not limited to, cash flow
projections and budgets, business plans, cash receipts and
disbursement analysis, asset and liability analysis, and the
economic analysis of proposed transactions for which Court
approval is sought;
-- assistance with the review of the Debtors' analysis of core
business assets and the potential disposition or liquidation
of non-core assets.
The hourly rates charged by FTI professionals anticipated to be
assigned to the case are:
Senior Managing Directors $780 - $895
Directors/Managing Directors $560 - $745
Consultants/Senior Consultants $280 - $530
Administrative/Paraprofessionals $115 - $230
To the best of the Debtors' knowledge, FTI does not hold or
represent any interest adverse to the estate.
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. In its amended schedules,
the Delta Petroleum disclosed $373,836,358 in assets and
$312,864,788 in liabilities.
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' restructuring advisor. Evercore Group L.L.C. is the
financial advisor and investment banker. 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.
Laramie Energy II LLC has been approved by the Court to serve as
the sponsor for Delta's reorganization plan.
Delta Petroleum has won approval for its disclosure statement
explaining the Chapter 11 reorganization plan. There's a hearing
to consider confirmation of the Plan on Aug. 15.
DEMCO INC: NY Demolition Services Provider in Chapter 11
--------------------------------------------------------
DEMCO, Inc., also known as Decommissioning & Environmental
Management Company, filed a Chapter 11 petition (Bankr. W.D.N.Y.
Case No. 12-12465) in Buffalo, New York.
Demco Inc. is a specialty trade contractor based in West Seneca,
New York, which provides demolition services, nuclear work,
environmental clean-up, disaster response and a variety of other
services throughout the United States and, on a project-by-project
basis, internationally. Some of Demco's better known demolition
projects in the past have included the Rocky Flats Nuclear Weapons
Plant, Yankee Stadium, the Orange Bowl, Buffalo Memorial
Auditorium, and the Sunflower Army Ammunition Plant.
As of the date of the filing, employees of Demco are currently
actively working on projects in eight different sites, a majority
of which are located outside of New York State. With 286
employees in its peak, Demco currently has 92 employees and one
independent contractor.
There's a hearing on the first day motions before Judge Michael J.
Kaplan on Aug. 9.
The Debtor is seeking to use cash collateral, pay prepetition
employee wages and benefits, and maintain its bank account at
First Niagara Bank.
The Debtor estimated assets and debts of $10 million to
$50 million.
DEMCO INC.: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: DEMCO, Inc.
aka Decommissioning & Environmental Management Company
238 Lein Road
West Seneca, NY 14224
Bankruptcy Case No.: 12-12465
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Western District of New York (Buffalo)
Judge: Michael J. Kaplan
Debtor's Counsel: Daniel F. Brown, Esq.
ANDREOZZI, BLUESTEIN, FICKESS, MUHLBAUER WEBER,
BROWN, LLP
333 International Drive, Suite B-4
Williamsville, NY 14221
Tel: (716) 633-3200
Fax: (716) 633-0301
E-mail: dfb@abfmwb.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Michael J. Morin, controller.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Apple Rubber Products, Inc. Loan $5,943,045
310 Erie Street
Lancaster, NY 14086
CTC Demolition Trade Debt $960,000
2273 State Highway 33, Suite 207
Hamilton Square, NJ 08690
LVI Services of NC Trade Debt $903,551
5411 Boran Drive
Tampa, FL 33610
Hook Demo SC, LLC Loan $500,001
300 Alton Road, Suite 300
Miami Beach, FL 33139
Recycled Group, LLC Loan $500,000
2031 NW 53rd Street
Ft. Lauderdale, FL 33309
MPS Group Trade Debt $488,252
2920 Scotten Street
Detroit, MI 48210
Chrysler LLC Trade Debt $400,468
4000 St. Jean Street
Detroit, MI 48214
Cambria Contracting Trade Debt $351,791
5105 Lockport Road
Lockport, NY 14094
Infinite Peaks Holding, LP Loan $300,000
9360 Station Street, Suite 425
Lone Tree, CO 80124
Eberline Services Trade Debt $299,848
7021 Pan American Freeway NE
Albuquerque, NM 87109
LVI Environmental Services Trade Debt $294,272
12 Oak Drive
Shawnee, OK 74804
Dow Chemical Company Trade Debt $258,102
7719 Collection Center Drive
Chicago, IL 60693
LVI Environmental Services Trade Debt $222,196
Brownfield Equity Co. LLC Loan $200,000
Best Asphalt Trade Debt $193,567
Conti Corporation Trade Debt $190,602
JTZ Inc. Zaccaro Roll Off Ser Trade Debt $165,818
Card Center Trade Debt $154,481
Michigan Cat Trade Debt $129,097
Evergreen Recycling of Corona Trade Debt $112,700
DEWEY & LEBOEUF: Files Schedules of Assets and Liabilities
----------------------------------------------------------
Dewey & Leboeuf LLP filed with the U.S. Bankruptcy Court for the
Southern District of New York its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $368,117,240
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $228,949,969
E. Creditors Holding
Unsecured Priority
Claims $343,589
F. Creditors Holding
Unsecured Non-priority
Claims $119,523,850
----------- -----------
TOTAL $368,117,240 $348,817,408
A copy of the schedules is available for free at
http://bankrupt.com/misc/DEWEY&LEBOEUF_sal.pdf
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of US$245
million and assets of US$193 million in its chapter 11 filing late
evening on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million. The Pension benefit Guaranty Corp. took US$2
million of the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The Former Partners hired Tracy L. Klestadt, Esq., and
Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel.
U.S. Bankruptcy Judge Martin Glenn on July 31 approved Dewey's
request to extend its funding deadline, which would have July 31,
to Aug. 15.
DEWEY & LEBOEUF: Six Members of Committee of Former Partners
------------------------------------------------------------
Tracy Hope Davis, the United States Trustee for Region 2,
appointed two more members to the Official Committee of Former
Partners in the Chapter 11 case of Dewey & LeBoeuf. The Former
Partners' Committee consists of:
1. David Bicks
c/o Duane Morris
1540 Broadway
New York, NY 10036
2. Cameron F. MacRae
c/o Duane Morris
1540 Broadway
New York, NY 10036
3. John S. Kinzey
3314 West End Ave, Unit 601
Nashville, TN 37203
4. John P. Campo
c/o Troutman Sanders LLP
405 Lexington Avenue
New York, NY 10174
5. Stuart Hirshfield
6 Meadow Road
P.O. Box 127
Stockbridge, MA 01262
6. E. Ann Gill
255 West 90 Street
Apt 3A
New York, NY 10024
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of US$245
million and assets of US$193 million in its chapter 11 filing late
evening on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million. The Pension benefit Guaranty Corp. took US$2
million of the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The Former Partners hired Tracy L. Klestadt, Esq., and
Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel.
DEWEY & LEBOEUF: Court Fixes Sept. 7 as Claims Bar Date
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
established Sept. 7, 2012, at 5 p.m., Eastern Time, as the
deadline for any individual or entity to file proofs of claim
against Dewey & Leboeuf LLP. Governmental units have until Nov.
26, at 5 p.m., to submit proofs of claim.
Proofs of claim must be filed either by:
1. U.S. Postal Service mail to:
Dewey & LeBoeuf LLP Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
FDR Station
P.O. Box 5283
New York, NY 10150-5283;
2. by hand delivery or overnight mail to:
Dewey & LeBoeuf LLP Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
757 Third Avenue, 3rd Floor
New York, NY 10017;
3. by delivering the original proof of claim by hand to:
The U.S. Bankruptcy Court for the Southern
District of New York
One Bowling Green, Room 534
New York, NY 10004
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of US$245
million and assets of US$193 million in its chapter 11 filing late
evening on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million. The Pension benefit Guaranty Corp. took US$2
million of the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The Former Partners hired Tracy L. Klestadt, Esq., and
Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel.
U.S. Bankruptcy Judge Martin Glenn on July 31 approved Dewey's
request to extend its funding deadline, which would have been
July 31, to Aug. 15.
DEWEY & LEBOEUF: Deloitte FAS OK'd as Panel's Financial Advisor
---------------------------------------------------------------
The Hon. Martin Glenn of the U.S. Bankruptcy Court for the
Southern District of New York authorized the Official Committee of
Unsecured Creditors in the Chapter 11 cases of Dewey & Leboeuf LLP
to retain Deloitte Financial Advisory Services LLP as its
financial advisor.
Daniel S. Polsky, a director of Deloitte FAS, assures the Court
that the firm is a "disinterested person" as that term is defined
in Section 101(14) of the Bankruptcy Code.
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of US$245
million and assets of US$193 million in its chapter 11 filing late
evening on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million. The Pension benefit Guaranty Corp. took US$2
million of the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The Former Partners hired Tracy L. Klestadt, Esq., and
Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel.
U.S. Bankruptcy Judge Martin Glenn on July 31 approved Dewey's
request to extend its funding deadline, which would have been
July 31, to Aug. 15.
DEWEY & LEBOEUF: Court OKs Sitrick as Communications Consultant
---------------------------------------------------------------
The Hon. Martin Glenn U.S. Bankruptcy Court for the Southern
District of New York authorized Dewey & Leboeuf LLP to employ
Sitrick and Company, a division of Sitrick Brincko Group, LLC as
corporate communications consultant.
Michael Sitrick, chairman and CEO of Sitrick, assures that Sitrick
is a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of US$245
million and assets of US$193 million in its chapter 11 filing late
evening on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million. The Pension benefit Guaranty Corp. took US$2
million of the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The Former Partners hired Tracy L. Klestadt, Esq., and
Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel.
U.S. Bankruptcy Judge Martin Glenn on July 31 approved Dewey's
request to extend its funding deadline, which would have July 31,
to Aug. 15.
DYNEGY INC: Posts $1.06 Billion Net Loss in Second Quarter
----------------------------------------------------------
Dynegy Inc. filed its quarterly report on Form 10-Q, reporting a
net loss of $1.064 billion for the three months ended June 30,
2012, compared with a net loss of $116 million for the same period
of 2011.
Revenues decreased by $273 million from $326 million for the three
months ended June 30, 2011 to $53 million for the three months
ended June 30, 2012. Of this decrease, $198 million is due to the
deconsolidation of DH and $40 million is related to only including
two months of activity related to the Coal segment in 2012 results
due to the Coal Holdco Transfer.
As a result of the Coal Holdco Transfer, Dynegy recorded a loss of
approximately $941 million during the three months ended June 30,
2012. There was no such loss during the three months ended
June 30, 2011.
For the six months ended June 30, 2011, the Company reported a net
loss of $1.122 billion on $230 million of revenues, compared with
a net loss of $193,000 on $831 million of revenues for the same
period last year. Revenues decreased by $601 million from
$831 million for the six months ended June 30, 2011 to $230
million for the six months ended June 30, 2012. Of this decrease,
$503 million is due to the deconsolidation of DH and $40 million
to only including five months of activity related to the Coal
segment in 2012 results due to the Coal Holdco Transfer.
Deconsolidation of Investment in DH
As a result of the DH Chapter 11 Cases, Dynegy deconsolidated its
investment in DH and its wholly-owned subsidiaries as of Nov. 7,
2011. Financial statement periods presented after Nov. 7, 2011,
thus reflect Dynegy's investment in, and the results of operations
of, DH and its wholly-owned subsidiaries under the equity method
of accounting.
Balance Sheet
The Company's balance sheet at June 30, 2012, showed $119 million
in total assets, $121 million in total liabilities, and a
stockholders' deficit of $2 million.
Amended and Restated Settlement Agreement
According to the regulatory filing, on June 5, 2012, the effective
date of the Settlement Agreement, as discussed below, Dynegy
assigned and contributed 100% of its outstanding equity interests
in Dynegy Coal Holdco, LLC, the indirect owner of Dynegy's assets
in the Coal segment, to DH (the "Coal Holdco Transfer").
Subsequent to the transfer, Dynegy has no operating assets outside
of its equity investment in DH.
"As a result of the Coal Holdco Transfer and the lack of operating
assets until DH's expected emergence from bankruptcy, we believe
there is substantial doubt about our ability to continue as a
going concern."
Pursuant to the amended and restated settlement agreement (the
"Settlement Agreement") dated May 30, 2012, Dynegy and DH entered
into a Contribution and Assignment Agreement, pursuant to which
Dynegy and DH undertook the Coal Holdco Transfer. In full
consideration for such contribution and in accordance with the
terms of the Settlement Agreement and the June 1, 2012 order
approving the Settlement Agreement, (i) Dynegy has received an
allowed administrative claim pursuant to Sections 503(b) and
507(a) of the Bankruptcy Code in an unliquidated amount against DH
in the DH Chapter 11 Cases, (ii) the Prepetition Litigation, the
Adversary Proceeding and the affiliate payable to DH were
dismissed with prejudice or released and (iii) the parties to the
Settlement Agreement issued and received the releases set forth in
the Settlement Agreement. Also pursuant to the Settlement
Agreement on June 5, 2012, the Undertaking Agreement and the DH
note were terminated with no further obligations thereunder.
A copy of the Form 10-Q is available for free at:
http://is.gd/Av8K5M
About Dynegy
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) Nov. 7, 2011, to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet. Dynegy Holdings disclosed assets of
$13.77 billion and debt of $6.18 billion.
Dynegy Inc. on July 6, 2012, filed a voluntary petition to
reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) to
effectuate a merger with Dynegy Holdings, pursuant to Holdings'
Chapter 11 plan.
A settlement, which has already been approved by the bankruptcy
court, provides for Dynegy Inc. and Holdings to merge and for the
administrative claim granted to Dynegy Inc. in the Holdings
Chapter 11 case to be transferred out of Dynegy Inc. for the
benefit of its shareholders.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues. The financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors in Holdings' cases
has tapped Akin Gump Strauss Hauer & Feld LLP as counsel.
Dynegy Inc. is represented by White & Case LLP and advised by
Lazard Freres & Co. LLC.
EASTMAN KODAK: Gets Court OK to Pay $6MM in Performance Bonuses
---------------------------------------------------------------
Joseph Checkler at Dow Jones' Daily Bankruptcy Review reports that
a Bankruptcy Judge cleared Eastman Kodak Co. to pay up to $4.5
million in bonuses to 12 top executives and senior managers, along
with a one-time cash payment of up to $1.5 million to its chief
operating officer.
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies with
strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from a
business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Kodak disclosed $5.10 billion in assets and $6.75 billion in
liabilities as of Sept. 30, 2011. The net book value of all
assets located outside the United States as of Dec. 31, 2011 is
$13.5 million.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped
Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
EASTMAN KODAK: Incurs $299 Million Net Loss in Second Quarter
-------------------------------------------------------------
Eastman Kodak Company filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
attributable to the Company of $299 million on $1.07 billion of
total net sales for the three months ended June 30, 2012, compared
with a net loss attributable to the Company of $179 million on
$1.48 billion of total net sales for the same period during the
prior year.
Kodak's revenue in the second quarter represented a decline of 27%
from the year-ago quarter, reflecting the exit of digital cameras,
reduced sales of traditional products, participation choices
across its businesses, and the negative impact of currency
exchange.
The Company reported a net loss attributable to the Company of
$665 million on $2.04 billion of total net sales for the six
months ended June 30, 2012, compared with a net loss attributable
to the Company of $425 million on $2.80 billion of total net sales
for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $4.61 billion
in total assets, $7.57 billion in total liabilities and a $2.95
billion total deficit.
The Company incurred a net loss for the years ended 2011, 2010
and, 2009, as well as the six months ended June 30, 2012, and had
a shareholders' deficit as of June 30, 2012, Dec. 31, 2011, and
Dec. 31, 2010.
"To improve the Company's performance and address competitive
challenges, the Company is developing a strategic plan for the
ongoing operation of the Company's business. Successful
implementation of the Company's plan, however, is subject to
numerous risks and uncertainties. In addition, the increasingly
competitive industry conditions under which the Company operates
have negatively impacted the Company's financial position, results
of operations and cash flows and may continue to do so in the
future. These factors raise substantial doubt about the Company's
ability to continue as a going concern," the Company said in its
quarterly report ending June 30, 2012.
"I am pleased with our progress, and our operating results are
both improved from last year and also ahead of our plan," said
Antonio M. Perez, Chairman and Chief Executive Officer. "We are
committed to sustaining the progress required to successfully
emerge from Chapter 11."
A copy of the Form 10-Q is available for free at:
http://is.gd/c4VYL1
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies with
strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from a
business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Kodak disclosed $5.10 billion in assets and $6.75 billion in
liabilities as of Sept. 30, 2011. The net book value of all
assets located outside the United States as of Dec. 31, 2011 is
$13.5 million.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped
Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
EMMIS COMMUNICATIONS: To Keep $4-Mil. of Stations Sale Proceeds
---------------------------------------------------------------
Emmis Communications Corporation and certain of its subsidiaries
entered into a Waiver and Amendment in connection with their
senior secured credit facility in order:
(i) to allow Emmis to retain up to $4,000,000 of the proceeds
from the sale, by certain of its subsidiaries, of certain
station assets subject to that certain LMA Agreement, dated
as of April 3, 2009, among such subsidiaries, Grupo Radio
Centro LA, LLC, and Grupo Radio Centro S.A.B. de. C.V.;
(ii) to provide for an increase in the exit fee from 6% to 7%
under that certain backstop letter, dated as of March 27,
2011, on amounts outstanding after application of proceeds
from the sale that are subject to the backstop letter
and only in the event of that Retention; and
(iii) to allow Emmis to enter into a local programming and
marketing agreement with a purchase obligation for the
associated station assets, for a monthly fee payable under
such local programming and marketing agreement not to
exceed $5,000 and a purchase price under the associated
purchase obligation not to exceed $375,000.
On Aug. 3, 2012, Emmis entered into an amendment to the Note
Purchase Agreement, dated as of Nov. 10, 2011, (as amended) with
Zell Credit Opportunities Master Fund, L.P., to allow for the
entry into the agreements and consummation of the transactions
described above in connection with the Waiver and Amendment.
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's balance sheet at May 31, 2012, showed $350.94
million in total assets, $360.51 million in total liabilities,
$46.88 million in series A cumulative convertible preferred stock,
and a $56.45 million total deficit.
ENTERPRISE PRODUCTS: Fitch Puts Rating on Jr. Subordinated at BB+
-----------------------------------------------------------------
Fitch Ratings has assigned 'BBB' senior unsecured ratings to
Enterprise Products Operating LLC's (EPO) proposed senior notes
offerings due 2015 and 2043. The notes will rank pari passu with
all of EPO's existing and future unsecured senior indebtedness.
Proceeds will be used to temporarily reduce borrowings under EPO's
revolving credit facility (which was recently used to repay
outstanding amounts on the maturity of $500 million of senior
notes P due August 2012) and for general company purposes. EPO is
the operating partnership for Enterprise Partners L.P. (NYSE:EPD).
EPO's ratings are supported by the company's size; quality and
diversity of its portfolio of midstream assets; strong financial
performance and conservative policy approach toward distributions
and financings; and increasing percentage of fee-based revenue.
EPO's sizable portfolio of midstream assets provides strong
consistent cash flow and earnings. EPO's midstream asset base
covers most major domestic gas producing basins. Geographic and
business line diversity largely insulate EPO from any dynamic
shifts in oil and gas production as well as provides it ample
organic growth opportunities within its operating footprint,
limiting the need or desire to make large scale acquisitions for
the sake of growth. EPO accesses all of the major gas and oil
production regions in the U.S. EPO serves all the U.S. based
ethylene steam crackers, which are the largest consumers of
natural gas liquids (NGLs). Fitch notes that NGL and crude prices
can be very volatile and weakness in crude, NGL, and or
fractionation spreads could impact EPO's cash flow and earnings.
Fitch recognizes that EPO is in the middle of a significant
capital spending program. These growth investments are largely
focused on primarily fee-based or revenue assured assets which
should continue to help lower EPO's exposure to changes in
commodity prices. Additionally, Fitch expects EPO's leverage
metrics will improve as EPO benefits from the earnings and cash
flow associated with project completion and operation.
Additional Favorable Characteristics for EPO Include:
-- Conservative distribution practices and supportive ownership;
-- Beneficial industry trends in the pricing relationship of
natural gas to crude oil;
-- Growing utilization of NGLs by the petrochemical industry as
feedstock for ethylene production;
-- The movement of natural gas production activity to liquids
rich producing basins such as the Eagle Ford Shale play where
EPO is well positioned.
Credit Concerns for EPO Include:
-- An aggressive growth strategy with targeted capital
expenditures of approximately $5 billion through 2013;
-- Exposure to commodity price volatility particularly NGL
margins.
What Could Trigger A Rating Action
Positive: Future developments that may, individually or
collectively, lead to positive rating action include:
-- Sustained improvement in leverage metrics;
-- A further shift in revenue towards more fee-based sources.
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- Continued large-scale capital expenditure program funded by
higher than expected debt borrowings, and;
-- An increase in gross margin sensitivity to changes in
commodity prices.
Fitch currently rates EPO as follows:
-- Issuer Default Rating (IDR) 'BBB';
-- Senior unsecured rating 'BBB';
-- Junior subordinated rating 'BB+'.
FIRST DATA: To Offer $750 Million Senior Secured Notes
------------------------------------------------------
First Data Corporation intends to offer $750 million aggregate
principal amount of senior secured notes due 2020. In accordance
with the terms of its senior secured credit facilities, First Data
will use the proceeds from the offering to repay a portion of its
outstanding senior secured term loans.
The Notes have not been registered under the Securities Act of
1933, as amended, and, unless so registered, may not be offered or
sold in the United States absent registration or an applicable
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other
applicable securities laws.
About First Data
Based in Atlanta, Georgia, First Data Corporation, with over
$10 billion of revenue for the 12 months ended June 30, 2010,
provides commerce and payment solutions for financial
institutions, merchants, and other organizations worldwide.
The Company reported a net loss of $336.10 million in 2011, a net
loss of $846.90 million in 2010, and a net loss of $1.01 billion
on $9.31 million in 2009.
The Company's balance sheet at March 31, 2012, showed $41.42
billion in total assets, $38 billion in total liabilities, $66.20
million in redeemable noncontrolling interest, and $3.34 billion
in total equity.
* * *
The Company's carries a 'B3' corporate family rating, with a
stable outlook, from Moody's Investors Service, a 'B' corporate
credit rating, with stable outlook, from Standard & Poor's, and
a 'B' long-term issuer default rating from Fitch Ratings.
FORT LAUDERDALE BOATCLUB: Case Summary & Largest Unsec. Creditors
-----------------------------------------------------------------
Debtor: Fort Lauderdale BoatClub, Ltd.
800 Seagate Drive, Suite 203
Naples, FL 34103
Bankruptcy Case No.: 12-28776
Chapter 11 Petition Date: August 2, 2012
Court: U.S. Bankruptcy Court
Southern District of Florida (Fort Lauderdale)
About the Debtor: The Debtor owns a fully developed and
operational marina facility formerly known as
Jackson Marine Center in Fort Lauderdale. The
marina, which has a 12-acre prime intracoastal
waterway real estate, is currently being leased
to G. Robert Toney & Associates Inc. doing
business as National Liquidators, for $75,000
per month (reduced from the previous rate
$160,000 per month).
Debtor's Counsel: Barry P. Gruher, Esq.
GENOVESE JOBLOVE & BATTISTA, P.A.
200 E. Broward Boulevard, #1110
Ft Lauderdale, FL 33301
Tel: (954) 453-8000
E-mail: bgruher@gjb-law.com
Scheduled Assets: $13,483,209
Scheduled Liabilities: $10,340,756
The petition was signed by Edward J. Ruff, president.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bilzin Sumberg, Attorneys at Law Legal Fees $150,024
1450 Brickell Avenue, 23rd Floor
Miami, FL 33131-3456
BoatClubsAmerica, LLC Unpaid Management $146,000
800 Seagate Drive, Suite 203 Fees
Naples, FL 34103
Waterworks 2011 Utility/Sewer $35,351
City of Ft. Lauderdale Assessment
100 N. Andrew Avenue
Fort Lauderdale, FL 33301
BCA Construction, LLC Licensed General $6,812
Contractor Services
Myer Unkovic & Scott, LLP Legal Fees $1,463
AT&T DC Fire Sprinkler $1,106
Alarms
Aerial Photography, Inc. -- Unknown
Bass Fire and Security -- Unknown
Broward County Rev Coll/Licen Notice Only Unknown
City of Ft. Lauderdale -- Unknown
Dept. of Environmental Protection -- Unknown
FBS Property Tax Abatement -- Unknown
Federal Express -- Unknown
Fidelity National Indemnity -- Unknown
Insurance Co.
Florida Department of Revenue Notice Only Unknown
Florida Department of State -- Unknown
Division of Corporations
GW Bulldozing, Inc. -- Unknown
Internal Revenue Service Notice Only Unknown
Special Procedures ? Field Insolvency
Internal Revenue Service Notice Only Unknown
Centralized Insolvency Operation
Jordan's Permit Expediting -- Unknown
FRESH START: Had $18,800 Net Loss in First Quarter
--------------------------------------------------
Fresh Start Private Management, Inc., filed its quarterly report
on Form 10-Q, reporting a net loss of $18,841 on sales of $260,883
for the the three months ended March 31, 2012, compared with a net
loss of $147,404 on sales of $28,650 for the corresponding period
of 2011.
The Company's balance sheet at March 31, 2012, showed
$4.89 million in total assets, $1.41 million in total liabilities,
and stockholders' equity of $3.48 million.
As reported in the TCR on Jul 11, 2012, Wilson Morgan LLP, in
Irvine, California, expressed substantial doubt about Fresh
Start's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that of the Company's losses from
operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/nL7HVQ
Fresh Start Private Management, Inc., through its wholly owned
subsidiary, is an alcohol rehabilitation and treatment center
headquartered in Santa Ana, California. The Company was
established in January 2010 and is currently operating in Santa
Ana, California. The Company's alcohol rehabilitation program
consists of a Naltrexone implant that is placed under the skin in
the lower abdomen coupled with life counseling sessions from
specialized counselors.
FRESNO, CA: Has Fiscal Resemblance to Bankrupt Neighbors
--------------------------------------------------------
Michael B. Marois at Bloomberg News reports that leaders at
Fresno, California, insist that the state's fifth-largest city
isn't going to go bankrupt. That's cheering investors who bought
its debt at a record low.
Like Stockton and San Bernardino, California cities that sought
court protection from creditors in the past six weeks, Fresno's
budget has buckled as labor costs rose while tax revenue succumbed
to the longest recession since the 1930s. The city north of Los
Angeles had its credit downgraded last month as cash ran dry and
talks to win wage concessions stalled.
The fiscal resemblance to its insolvent neighbors has put Fresno
"in the crosshairs," Citigroup Inc. analysts said in a report last
month, Bloomberg said. As speculation built that the city of
500,000 would become the nation's biggest to go bankrupt, the
extra yield on some Fresno bonds over AAAs soared to a record 2.71
percentage points last month. The debt has appeal at these
levels, given officials' vows while municipal interest rates are
at 45-year lows, said Bud Byrnes at RH Investment Corp.
"In a market where there is no yield, I would think that there are
buyers who would look at this," said Byrnes, president and chief
executive officer of RH, a muni-bond trading company in Encino,
California.
Fresno, in the middle of the state about 200 miles from Los
Angeles, is the hub of a farming county that produced $6 billion
of agricultural commodities in 2010, including almonds, raisins
and oranges. Nonetheless, the recession helped open $100 million
of cumulative deficits in the city budget since February 2009 even
as Fresno cut a third of its worker positions. The metropolitan
area's jobless rate was 15.3 percent in June, compared with 10.7
percent statewide.
Fresno, Stockton and San Bernardino were among the 20 metropolitan
areas with the nation's highest foreclosure rates in the first
half of 2012, according to RealtyTrac Inc.
FRIENDFINDER NETWORKS: Had $21.5-Mil. Net Loss in First Quarter
---------------------------------------------------------------
FriendFinder Networks Inc. filed its quarterly report on Form 10-
Q, reporting a net loss of $21.52 million on $81.08 million of
revenue for the three months ended March 31, 2012, compared with a
net loss of $3.68 million on $83.52 million of revenue for the
same period in 2011.
The Company's balance sheet at March 31, 2012, showed
$475.35 million in total assets, $624.97 million in total
liabilities, and a stockholders' deficit of $149.62 million.
A copy of the Form 10-Q is available for free at:
http://is.gd/ReNLbc
Boca Raton, Florida-based FriendFinder Networks Inc., together
with Various, Inc and its other wholly-owned subsidiaries, is an
internet and technology company providing services in the social
networking and web-based video sharing markets. The business
consists of creating and operating technology platforms which run
several websites throughout the world appealing to users of
diverse cultures and interest groups including the social commerce
market offering members high quality deals through a suite of
websites. The Company is also engaged in entertainment activities
consisting of publishing, licensing and studio production and
distribution. The Company publishes PENTHOUSE and other adult-
oriented magazines and digests. Additionally, the Company
licenses the PENTHOUSE name for international publication of adult
magazines and for use on various products and provides various
adult-oriented multimedia entertainment products and services,
including content for DVD and pay-per-view programming.
* * *
As reported in the TCR on April 9, 2012, Standard & Poor's Ratings
Services lowered its rating on Boca Raton, Fla.-based FriendFinder
Networks Inc. to 'CCC+' from 'B-'.
"All issue-level ratings on the company's debt have also been
lower by one notch in conjunction with the downgrade. The ratings
were removed from CreditWatch, where they were placed with
negative implications on Feb. 29, 2012. The rating outlook is
negative," S&P said.
FRIENDSHIP DAIRIES: Files for Chapter 11 in Texas
-------------------------------------------------
Friendship Dairies filed a Chapter 11 petition (Bankr. N.D. Tex.
Case No. 12-20405) in Amarillo, Texas, on Aug. 6.
The Debtor is seeking an expedited hearing on its request to use
cash collateral. It has also filed an application to employee J.
Bennett White, P.C., as counsel.
The Debtor estimated assets and debts of $10 million to
$50 million. The Debtor operates a dairy near Hereford, Deaf
Smith County, Texas. The dairy consists of 11,000 head of cattle,
fixtures and equipment. The Debtor also farms 5,000 acres of land
for production of various crops used in feeding for the cattle.
The Debtor crop production last year was below expectations due to
a drought during the summer. As a result, the reduced yield from
the crop has proven inadequate to meet the feed needs of the
Debtor's cattle.
The Debtor already owes McFinney Agri-Finance, LLC, $16 million
secured by the Debtor's property, which is appraised at more than
$24 million.
The Debtor said it has received a "milk check" in the amount of
$1.1 million. It receives a milk check in similar amount every
two weeks.
The Debtor in the cash collateral motion said that it should be
allowed to have unrestricted use of the milk check in order to
continue operating its business.
The Debtor said that McFinney's interest is adequately protected
by the substantial value of the assets.
FRIENDSHIP DAIRIES: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Friendship Dairies
P.O. Box 1556
Hereford, TX 79045
Bankruptcy Case No.: 12-20405
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Northern District of Texas (Amarillo)
Judge: Robert L. Jones
Debtor's Counsel: J. Bennett White, Esq.
J. BENNETT WHITE, P.C.
P.O. Box 6250
Tyler, TX 75711
Tel: (903) 597-4300
Fax: (903) 597-4330
E-mail: sgardner@jbwlawfirm.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Patrick Van Adrichem, partner.
FUSION TELECOMMUNICATIONS: Amends LOI with Two Private Funds
------------------------------------------------------------
Fusion Telecommunications International, Inc., and two private
funds executed a revised letter of intent, which amended certain
provisions of the original LOI executed on April 3, 2012. Under
the terms of the Revised LOI, the senior debt investment by the
Lenders is expected to be comprised of five-year senior notes
aggregating $16.5 million, bearing interest at rates ranging from
10% to 11.5%. The Revised LOI also provides that upon the closing
of the senior debt investment by the Lenders, the Company will
issue to the Lenders shares of the Company's common stock in an
amount equal to 5% of the outstanding common stock of the Company
at the time of closing, as adjusted for certain common stock
equivalents outstanding to be identified in the definitive loan
documents.
In addition, while the Lenders' obligation to consummate the debt
agreement and advance proceeds under the senior notes remains
subject to a number of preconditions, including but not limited
to, completion of due diligence acceptable to the Lenders, the
Company's adherence to certain financial conditions and formulae,
the negotiation and execution of mutually acceptable loan
documents with the Lenders and the Company's consummation of the
acquisition of NBS on substantially the terms set forth in the
executed transaction documentation, the required equity to be
raised by the Company was reduced from $7 million under the
Original LOI to $5.5 million under the Revised LOI.
The Original LOI outlined the terms for a senior debt investment
by the Lenders of $15 million in connection with the Company's
pending acquisition of the business currently operated by Network
Billing Systems, LLC, and Interconnect Services Group II LLC.
About Fusion Telecommunications
New York City-based Fusion Telecommunications International, Inc.
(OTC BB: FSNN) is a provider of Internet Protocol ("IP") based
digital voice and data communications services to corporations and
carriers worldwide.
In its audit report on the 2011 financial statements, Rothstein,
Kass & Company, P.C., in Roseland, New Jersey, noted that the
Company has had negative working capital balances, incurred
negative cash flows from operations and net losses since
inception, and has limited capital to fund future operations that
raises a substantial doubt about their ability to continue as a
going concern.
The Company reported a net loss of $4.45 million in 2011, compared
with a net loss of $5.79 million in 2010.
The Company's balance sheet at March 31, 2012, showed $3.90
million in total assets, $14.27 million in total liabilities and a
$10.37 million total stockholders' deficit.
GAMETECH INTERNATIONAL: Sec. 341 Creditors' Meeting Tomorrow
------------------------------------------------------------
The U.S. Trustee for the District of Delaware will convene a
Meeting of Creditors pursuant to 11 U.S.C. Sec. 341(a) in the
Chapter 11 case of Gametech International, Inc., on Aug. 9, 2012,
at 10:30 a.m. at the U.S. District Court, 844 King St., Room 2112,
Wilmington, Delaware.
About Gametech International
Based in Reno, Nevada, GameTech develops and manufactures gaming
entertainment products and systems. GameTech holds a significant
position in the North American bingo market with its interactive
electronic bingo systems, portable and fixed-based gaming units,
and complete hall management modules. It also holds a significant
position in select North American VLT markets, primarily Montana,
Louisiana, and South Dakota, where it offers video lottery
terminals and related gaming equipment and software. It also
offers Class III slot machines and server-based gaming systems.
GameTech International, Inc. and its wholly owned subsidiaries
have filed Chapter 11 petitions (Bankr. D. Del. Lead Case No.
12-11964) on July 2, 2012, to effect a restructuring of the
company's debt obligations. GameTech disclosed total assets of
$27.22 million and total liabilities of $22.88 million as of
Jan. 29, 2012. Judge Peter J. Walsh presides over the case.
Andrew E. Robinson signed the petition as senior vice president,
chief financial officer, and treasurer.
The Debtors are represented by Greenberg Traurig, LLP. Kinetic
Advisors, LLC, serves as the Debtors' financial advisor.
GATEHOUSE MEDIA: Incurs $2.86-Mil. Net Loss in Second Quarter
-------------------------------------------------------------
Gatehouse Media, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.86 million on $128.76 million of total revenues for the
three months ended July 1, 2012, compared with a net loss of $5.06
million on $134.39 million of total revenues for the three months
ended June 26, 2011.
The Company reported a net loss of $16.23 million on $248.77
million of total revenues for the six months ended July 1, 2012,
compared with a net loss of $23.25 million on $254.21 million of
total revenues for the six months ended June 26, 2011.
The Company's balance sheet at July 1, 2012, showed $487.40
million in total assets, $1.31 billion in total liabilities and a
$823.09 million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/e013l5
About GateHouse Media
GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications. GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.
The Company reported a net loss of $22.22 million for the year
ended Jan. 1, 2012, a net loss of $26.64 million for the year
ended Dec. 31, 2010, and a net loss of $530.61 million for the
year ended Dec. 31, 2009.
Bankruptcy Warning
According to the Form 10-K for the year ended Dec. 31, 2011, the
Company's ability to make payments on its indebtedness as required
depends on its ability to generate cash flow from operations in
the future. This ability, to a certain extent, is subject to
general economic, financial, competitive, legislative, regulatory
and other factors that are beyond the Company's control.
There can be no assurance that the Company's business will
generate cash flow from operations or that future borrowings will
be available to the Company in amounts sufficient to enable it to
pay its indebtedness or to fund our other liquidity needs.
Currently the Company does not have the ability to draw upon its
revolving credit facility which limits its immediate and short-
term access to funds. If the Company is unable to repay its
indebtedness at maturity the Company may be forced to liquidate or
reorganize its operations and business under the federal
bankruptcy laws.
GENTA INC: Files for Chapter 7 Bankruptcy to Liquidate
------------------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle, reports that Genta Inc. filed for
bankruptcy to liquidate (Bankr. D. Del. Case No. 12-12269) a week
after warning that it may need to seek court protection if it
couldn't obtain financing. The Berkeley Heights, New Jersey-based
company estimated assets of as much as $10 million and debt of as
much as $100 million in chapter 7 documents filed Aug. 3.
"The company has actively sought additional financing and a
strategic partner; however, to date those efforts have been
unsuccessful. If the company cannot secure financing or a
strategic partner, the company may file for reorganization under
bankruptcy," Genta said in a July 27 filing with the Securities
and Exchange Commission.
About Genta Incorporated
Berkeley Heights, New Jersey-based Genta Incorporated (OTC BB:
GNTA) -- http://www.genta.com/-- is a biopharmaceutical company
engaged in pharmaceutical (drug) research and development. The
Company is dedicated to the identification, development and
commercialization of novel drugs for the treatment of cancer and
related diseases.
In its report on the financial statements for 2011, EisnerAmper
LLP, in Edison, New Jersey, noted that the Company's recurring
losses from operations and negative cash flows from operations and
current maturities of convertible notes payable raise substantial
doubt about its ability to continue as a going concern.
The Company reported a net loss of $69.42 million in 2011,
compared with a net loss of $167.30 million during the prior year.
The Company's balance sheet at March 31, 2012, showed $4.56
million in total assets, $34.74 million in total liabilities and a
$30.17 million total stockholders' deficit.
GLOBAL AVIATION: OK'd to Expand Ernst& Young Services
-----------------------------------------------------
The Hon. Carla E. Craig of the U.S. Bankruptcy Court for the
Eastern District of New York authorized Global Aviation Holdings
Inc., et al., to expand the scope of employment of Ernst & Young
LLP.
The amended order provides that EY LLP will provide additional
services. EY LLP has agreed to:
1. Respond to as needed technical questions related to Global
Aviation's government contracts and agreements supporting
the Civilian Reserve Aviation Fleet agreement. The advisory
assistance is limited to SEC permitted services.
2. Identify key agreement terms and the related regulatory
requirements.
3. Interview and discuss with Global Aviation personnel with
knowledge of the company's processes, practices and
procedures relative to the CRAF agreement and cost
allocation methodologies.
4. Read select Global Aviation documents in order to assist us
in EY LLP's understanding of Global Aviation's processes,
practices and procedures to include contracts, subcontracts,
agreements, cost accounting reports, accounting information
and other management reports relevant to processes or
issues.
5. Read audit reports issued by the Defense Contract Audit
Agency and other related correspondence to/from the
Government to include the DCAA and Global Aviation's
cognizant contracting officer.
6. Analyze cost accounting and allocation methodologies
specific to the CRAF agreement.
7. Prepare a summary memorandum for Global Aviation management
to describe observations.
8. Provide internal training on specific Government compliance
topics.
Malcomb Coley, a partner of EY LLP, "disinterested person" as
defined in section 101(14) of the Bankruptcy Code,
About Global Aviation Holdings
Global Aviation Holdings Inc., based in Peachtree City, Ga., is
the parent company of North American Airlines and World Airways.
Global is the largest commercial provider of charter air
transportation for the U.S. military, and a major provider of
worldwide commercial global passenger and cargo air transportation
services. North American Airlines, founded in 1989 and based in
Jamaica, N.Y., operates passenger charter flights using B757-200ER
and B767-300ER aircraft. World Airways, founded in 1948 and based
in Peachtree City, Ga., operates cargo and passenger charter
flights using B747-400 and MD-11 aircraft.
Global Aviation, along with affiliates, filed Chapter 11 petitions
(Bankr. E.D.N.Y. Case No. 12-40783) on Feb. 5, 2012.
Global's lead counsel in connection with the restructuring is
Kirkland & Ellis LLP and its financial advisor is Rothschild.
Kurtzman Carson Consultants LLC is the claims agent.
The Debtors disclosed $589.8 million in assets and $493.2 million
in liabilities as of Dec. 31, 2011. Liabilities include $146.5
million on 14% first-lien secured notes and $98.1 million on a
second-lien term loan. Wells Fargo Bank NA is agent for both.
Global said it will use Chapter 11 to shed 16 of 30 aircraft.
In addition, Global said it will use Chapter 11 to negotiate new
collective bargaining agreements with its unions and deal with
liabilities on multi-employer pension plans.
On Feb. 13, 2012, the U.S. Trustee for Region 2 appointed a seven
member official committee of unsecured creditors in the case. The
Committee tapped Lowenstein Sandler PC as its counsel, and
Imperial Capital, LLC as its financial advisor.
The Hon. Carla E. Craig has extended the Debtors' exclusive period
to file a Chapter 11 plan for each Debtor until Oct. 2, 2012, and
the exclusive period to solicit acceptances of a Chapter 11 plan
of each Debtor until Dec. 3, 2012.
GRAY TELEVISION: Reports $10.99-Mil. Profit in 2nd Quarter
----------------------------------------------------------
Gray Television, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing net income
of $10.99 million on $94.96 million of revenue for the three
months ended June 30, 2012, compared with net income of $2.55
million on $76.20 million of revenue for the same period during
the prior year.
The Company reported net income of $14.36 million on $175.36
million of revenue for the six months ended June 30, 2012,
compared with a net loss of $524,000 on $145.94 million of revenue
for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $1.24 billion
in total assets, $1.08 billion in total liabilities, $24.99
million in series D perpetual preferred stock, and $135.12 million
total stockholders' equity.
"We are pleased with our operating results for the second quarter
of 2012," the Company said in a press release. "Our period over
period increase in revenue for the second quarter was primarily
due to increases in political advertising revenue and
retransmission consent revenue. In addition, our local
advertising, national advertising, internet advertising and other
revenue also increased."
A copy of the Form 10-Q is available for free at:
http://is.gd/2iraYs
About Gray Television
Formerly known as Gray Communications System, Atlanta, Georgia-
based Gray Television, Inc., is a television broadcast company.
Gray currently operates 36 television stations serving 30 markets.
Each of the stations are affiliated with either CBS (17 stations),
NBC (10 stations), ABC (8 stations) or FOX (1 station). In
addition, Gray currently operates 38 digital second channels
including 1 ABC, 4 Fox, 7 CW, 16 MyNetworkTV and 1 Universal
Sports Network affiliates plus 8 local news/weather channels and 1
"independent" channel in certain of its existing markets.
* * *
Gray Television carries 'Caa1' corporate family rating and
probability of default rating, with stable outlook, from Moody's.
"Moody's views the company's current level of financial leverage,
as exacerbated by a concentrated maturity profile, to be
unsustainable for a TV broadcaster and indicative of elevated
restructuring risk over the longer-term," said Moody's Russell
Solomon, Senior Vice President, in April 2010. Pro forma for the
pending transaction, all of Gray's debt (including its debt-like
Series D Preferred Stock) comes due in 2014-2015. Moody's
believes Gray will need to significantly reduce its debt with free
cash flow and will probably need to issue additional equity in
order to further moderate its leverage profile over the next few
years prior to accessing the capital markets again to refinance
current obligations. The Caa1 CFR incorporates Moody's view that
leverage will remain excessive over at least the next two years.
As reported by the TCR on April 9, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Atlanta, Ga.-based
TV broadcaster Gray Television Inc. to 'B' from 'B-'.
"The 'B' rating reflects company's still-high debt leverage and
weak discretionary cash flow, as well as our expectation that the
company will maintain adequate headroom with its financial
covenants in the absence of any further tightening of covenant
thresholds. The stable rating outlook reflects our expectation
that Gray will maintain lease-adjusted debt to average trailing-
eight-quarter EBITDA below 7.5x. We also expect the company to
generate modest positive discretionary cash flow in 2012," S&P
said.
H&E EQUIPMENT: Moody's Rates $480-Mil. Sr. Unsecured Notes 'B3'
---------------------------------------------------------------
Moody's Investors Service has assigned a B3 rating to H&E
Equipment Services, Inc. 's proposed $480 million, ten year senior
unsecured notes. Concurrently, all existing ratings were affirmed
including the B1 corporate family rating ("CFR"). The proposed
transaction would meaningfully increase overall financial leverage
as proceeds from the issuance of the proposed $480 million senior
unsecured notes are expected to be used to finance a special one-
time dividend to shareholders of approximately $246 million,
subject to approval by the company's Board of Directors as well as
repurchase the company's existing $250 million senior unsecured
notes. H&E was assigned an SGL-2 speculative grade liquidity
("SGL") rating denoting a good near term liquidity profile. The
outlook is stable.
The proposed transaction would result in higher interest expense
resulting from the incremental approximately $200 million of
funded debt that would be incurred post the transaction. As part
of the refinancing, the asset-based revolving credit facility (not
rated) would be increased and the company's debt maturity profile
extended to 2017. The B3 rating assigned to the proposed $480
million senior unsecured notes reflects their junior position to
the proposed amended $402.5 million ABL facility. Moody's expects
that the notes will be guaranteed by H&E's existing and any future
significant domestic subsidiaries. The notes are expected to be
sold according to Rule144A and under Regulation S if sold outside
the U.S.
Ratings assigned:
Proposed $480 million senior unsecured notes due 2022, B3
(LGD-5, 75%)
SGL-2 Speculative Grade Liquidity
Ratings affirmed with updated Loss Given Default assessments:
Corporate family rating at B1
Probability of default rating at B1
Existing $250 million 8.375% senior unsecured notes due 2016,
B3 (LGD-5, 80%).*
* The B3 rating on H&E's existing senior unsecured notes will
remain LGD-5, 80% pending their planned redemption.
These ratings have been assigned subject to Moody's review of
final documentation following completion of the proposed notes
offering. Assuming substantially all of the existing notes are
redeemed, the instrument rating will be withdrawn.
Ratings Rationale
The affirmation of H&E's B1 corporate family rating reflects the
company's moderate scale and credit metrics that solidly position
the company at the B1 rating category. Pro forma for the proposed
$480 million senior unsecured notes issue, debt/EBITDA
approximates 3.8x and EBITDA/interest stands at 3.9x, on a Moody's
adjusted basis. Although the ratings incorporate the expectation
that operating performance could continue to benefit from higher
anticipated rental rates and continued good demand in 2012 through
2013, it also incorporates that similar to other companies in the
equipment rental industry, companies will likely be using improved
cash from operations to pay for growth related capital
expenditures resulting in negative free cash flow over the
intermediate term. In addition, although operating results have
been improving, there continues to be uncertainty regarding the
degree of expected U.S. economic growth and the highly cyclical
nature of the equipment industry. The company has historically
performed better than some of its peers during downturns due to
the diversified nature of its business model that includes the
sale of equipment as well as parts and services related revenue
rather than solely the renting of equipment. In addition, due to
negative free cash flow from capital expenditure requirements to
supported demand growth, any meaningful credit metric improvement
would emanate from EBITDA improvement rather than debt reduction.
The ratings also consider the company's good liquidity profile.
The stable outlook is supported by H&E's good liquidity profile
and Moody's view that positive U.S. equipment rental industry
fundamentals could continue to be supportive of its B1 credit
profile over the intermediate term.
The assigned SGL-2 liquidity rating reflects a good liquidity
profile characterized by ample availability under its asset-based
revolving credit facility and the absence of any meaningful debt
maturities over the intermediate term. In addition, availability
under the asset-based credit facility is expected to comfortably
exceed the minimum availability threshold required before
financial ratio maintenance covenants would become applicable.
Similar to other equipment rental companies, free cash flow is
expected to be negative as a result of high capital expenditure
requirement to support continued revenue growth over the
intermediate term. The company is expected to be reliant on its
proposed amended $402.5 million borrowing based facility. As of
June 30, 2012 and pro forma for the proposed transaction,
borrowings are expected to stand at approximately $100 million
with higher anticipated usage going forward to support capital
expenditure requirements as minimal cash balances are typically
maintained on the balance sheet. The borrowing base level is
expected to continue to exceed the face amount of the facility
over the intermediate term.
A ratings increase is considered unlikely at this time given the
highly cyclical nature of the equipment rental industry and the
company's moderate revenue scale. Upward rating movement would
depend on the expectation that H&E would maintain a good liquidity
profile and achieve EBITA to total assets of 12% or higher and
lower debt/EBITDA towards 3.0x.
Downward pressure on the ratings could occur if the company's
liquidity profile were to weaken, any meaningful debt-financed
acquisitions were undertaken, debt/EBITDA were to reach and be
sustained above 4.25x, or if the company were to put cash flow
from deferred capital spending toward shareholder rewards.
The principal methodology used in rating H&E was the Global
Equipment and Automobile Rental Industry Methodology, published
December 2010. Other methodologies used include Loss Given Default
for Speculative Grade Issuers in the US, Canada, and EMEA,
published June 2009.
H&E is a multi-regional equipment rental company with over 60
locations throughout the West Coast, Intermountain, Southwest,
Gulf Coast, Mid-Atlantic, and Southeast regions of the United
States. H&E is also a distributor for JLG, Gehl, Genie Industries
(Terex), Komatsu, Doosan/Bobcat and Manitowoc, among others.
Revenues for the last twelve months ended June 30, 2012 totaled
$784 million.
H&E EQUIPMENT: S&P Affirms 'BB-' Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Baton Rouge, La.-based H&E Equipment Services
Inc., a provider of construction equipment rental services. "At
the same time, we assigned our 'B+' issue-level rating to the
proposed new $480 million senior unsecured notes. The recovery
rating is '5', indicating our expectation of a modest (30%-50%)
recovery in a default scenario. The company is also increasing the
size of its unrated asset-backed revolver to $403 million from
$320 million. The company will use proceeds from the new notes and
about $30 million drawn under the revolver to redeem the existing
$250 million senior unsecured notes, pay a $246 million dividend
to shareholders, and pay transaction and related fees," S&P said.
"The affirmation reflects our expectation that H&E will continue
to benefit from positive trends in the equipment rental industry
and reduce pro forma leverage to about 3.2x total debt to EBITDA
by the end of 2012 from about 3.7x," said Standard & Poor's credit
analyst Sarah Wyeth. "The dividend indicates a more aggressive
financial policy than we previously expected. However, the company
has on average historically maintained relatively low leverage for
the rating, and we believe it will reduce leverage to similar
levels as earnings grow."
S&P said its forecast assumes:
- The U.S. does not enter a recession, the odds of which
Standard & Poor's currently estimates to be 25%;
- Real nonresidential construction grows about 3% in 2012 and
flattens in 2013;
- The price of oil remains at a level at which energy-related
activity remains stable;
- Contractors tend to rent versus buy equipment because of
market uncertainty;
- EBITDA margins remain greater than 20% in 2012 and 2013; and
- Higher capital expenditures result in negative free cash flow
in 2012 and 2013.
"Our assessment of the company's business risk profile as 'weak'
primarily reflects H&E's participation in the cyclical, highly
competitive, and fragmented equipment rental sector. Its presence
as one of the largest integrated equipment services companies in
the U.S. will likely continue to temper this factor. H&E has three
main business segments: equipment rentals, new and used equipment
sales, and parts and services. The company has 63 full-service
facilities throughout the Intermountain (in the western U.S.),
Southwest, Gulf Coast, West Coast, Mid-Atlantic, and Southeast
regions. Although H&E is a public company, its directors and
management own about 21% of the company," S&P said.
"Similar to many equipment rental companies, H&E's performance is
closely tied to the nonresidential construction spending cycle.
Nonresidential construction spending has deteriorated meaningfully
since late 2008, and we expect it to remain weak in 2012 and 2013.
However, conditions in the equipment rental industry have improved
since 2011, partly because of contractors' preference for renting
(versus buying) equipment when projects are relatively scarce or
Uncertain," S&P said.
"Also, equipment rental companies are benefiting from strength in
some industrial end markets, especially those related to energy.
Over the long term, we expect contractors to continue outsourcing
their equipment needs. H&E's second-quarter rental revenues
increased 26% from the previous year, partly as a result of
industrial activity and a modest pickup in commercial
construction. An 11% increase in rental rates from the previous
year contributed to higher profitability: H&E's EBITDA margin was
22% as of June 30, 2012, up from 16% 12 months prior. H&E's lower-
margin distribution business results in lower overall margins than
those of most pure-play equipment rental companies," S&P said.
"H&E's financial risk profile is 'aggressive.' During periods of
strength in the equipment rental industry, we expect companies to
maintain relatively low leverage so that they have cushion to
absorb the next downturn. As of June 30, 2012, total debt to
EBITDA (adjusted for the present value of operating leases) was
about 2.1x, better than our expectation of about 3x. With this
transaction, the company will increase leverage to about 3.7x, but
we expect it to reduce leverage to about 3.2x at the end of 2012
and less than 3x by the end of 2013," S&P said.
"We expect the company to continue to invest in its fleet in 2012
and 2013. H&E's capital spending declined significantly in 2009
when demand declined during the recession. As end markets begin to
improve, equipment rental companies generally increase capital
spending in anticipation of greater demand. Consistent with this
pattern, we believe H&E's free cash flow will be negative in 2012
and 2013. However, we believe the company can manage capital
spending more effectively than some of its peers because it
maintains a relatively young fleet -- the average fleet age has
remained steady at about 40 months," S&P said.
"The outlook is stable. We base the ratings and outlook on the
assumption that key end-market nonresidential construction will
grow slowly in 2012 and flatten in 2013 but that H&E will continue
to experience good demand because of contractor uncertainty and
strength in energy-related markets. These conditions should allow
the company to maintain margins above 20% and reduce leverage to
less than 3x within 12 to 18 months," S&P said.
"However, we could lower the ratings if we believe a recession in
the U.S. could weaken nonresidential construction markets further
or result in lower demand from industrial customers. For instance,
if we believe the U.S. is likely to enter a recession and
nonresidential construction is likely to contract 5%, which could
result in leverage above 3.5x for a sustained period, we could
lower the ratings. The company's weak business risk profile limits
potential for an upgrade," S&P said.
HALIFAX GROUP: Brooklyn Properties Owner Files for Chapter 11
-------------------------------------------------------------
Rosedale, New York-based Halifax Group LLC filed a bare-bones
Chapter 11 petition (Bankr. E.D.N.Y. Case No. 12-45736) on Aug. 6,
2012. The Debtor disclosed total assets of $20.3 million and
liabilities of $96.8 million.
The Debtor said it owns $20.3 million worth of properties in
Hempstead, Brooklyn and Springfield Gardens, in New York. Most of
the properties are in Sapphire Street and Stanley Avenue in
Brooklyn.
It said DLJ Hahn & Hessen has a disputed claim of $48.27 million
on a bank loan, of which $20.3 million is secured by collateral.
Gateway Arms Realty Corp. has a disputed claim of $48.29 million,
of which $11 million is secured.
According to the statement of operations, the Debtor has not
received income from operations in the past two years.
HALIFAX GROUP: Case Summary & 5 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Halifax Group LLC
133-33 Brookville Boulevard
Rosedale, NY 11422
Bankruptcy Case No.: 12-45736
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Nancy Hershey Lord
Debtor's Counsel: Narissa A. Joseph, Esq.
LAW OFFICE OF NARISSA JOSEPH
277 Broadway, Suite 501
New York, NY 10007
Tel: (212) 233-3060
Fax: (212) 608-0304
E-mail: njosephlaw@aol.com
Scheduled Assets: $20,310,943
Scheduled Liabilities: $96,841,847
The petition was signed by Gregory Holland, president.
Debtor's List of Its Five Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
DLJ Hahn & Hessen Bank Loan $39,224,204
488 Madison Avenue
New York, NY 10022
Gateway Arms Realty Corp. Bank Loan $37,287,204
285 St. Marks Place
St. George Staten Island, NY 10301
Tuffanies Insurance Company -- $22,776
377 Oak Street, 4th Floor
Garden City, NY 11530
Standard Funding Corp -- $3,832
Standard Funding Corp -- $3,831
HOST HOTELS: Fitch Rates 4.75% Series C Senior Notes 'BB'
---------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating to the $450 million
aggregate principal amount 4.75% Series C senior notes due 2023
issued by Host Hotels & Resorts, L.P. Host Hotels & Resorts, Inc.
(NYSE: HST) is the sole general partner of Host Hotels & Resorts,
L.P. (collectively, Host). The offering is expected to close on
Aug. 9, 2012 and was priced at 329 basis points over the benchmark
treasury. The net proceeds of the offering of approximately $443
million will be used to redeem the remaining $250 million of
Host's 6.375% Series O senior notes due 2015, to redeem $150
million of Host's 6.75% Series Q senior notes due 2016, and for
general corporate purposes.
Fitch currently rates the company as follows:
Host Hotels & Resorts, Inc.
-- Issuer Default Rating (IDR) 'BB'.
Host Hotels & Resorts, L.P.
-- IDR 'BB';
-- $1.5 billion bank credit facility (including revolving credit
and term loan) 'BB';
-- $3.5 billion senior notes 'BB';
-- $525 million exchangeable senior debentures 'BB'.
The Rating Outlook is Stable.
The ratings reflect Fitch's view that Host's credit metrics will
remain appropriate for the 'BB' rating through the economic cycle
coupled with the company's luxury and upscale hotel portfolio.
Lodging fundamentals continue on a positive trajectory, despite
the global macroeconomic risk environment. Industry-wide U.S.
revenue per available room (RevPAR) is up 7% to date, continuing
to track solidly ahead of Fitch's initial 2012 forecast of
positive 4%-5%. During second quarter 2012 (2Q'12), Host's
comparable RevPAR increased by 6.1%. Moreover, Fitch anticipates
limited new U.S. lodging supply growth of less than 1% in 2012-
2013, well below the long-term historical average of 2.1%. The
rating takes into consideration the implicit volatility of lodging
earnings as well as the potential that economic weakness could
jeopardize RevPAR growth potential.
Leverage is appropriate for a 'BB' rated lodging REIT. Net debt
to recurring operating EBITDA was 4.5x for the trailing 12 months
(TTM) ended June 15, 2012, pro forma for the Series C senior notes
offering, compared with 5.0x in 2011 and 5.4x in 2010. While the
company has actively funded investments with its at-the-market
equity offering program, leverage reductions primarily stem from
organic growth. Fitch expects leverage to decline to between 4.0x
and 4.5x over the next 12-to-24 months. In a more adverse case
than currently anticipated by Fitch, leverage could rise to a
range of 5.0x to 6.0x over the next 12-to-24 months, which would
be consistent with a rating lower than 'BB'.
Host's fixed charge coverage ratio further supports the 'BB'
rating. Coverage was 1.9x for the TTM ended June 15, 2012 pro
forma for the Series C senior notes offering, compared with 1.9x
in 2011 and 1.7x in 2010. Fitch defines fixed charge coverage as
recurring operating EBITDA less renewal and replacement capital
expenditures, divided by cash interest expense and capitalized
interest.
Increased renewal and replacement capital expenditures have offset
improving EBITDA, flattening coverage. Projects during 2Q'12
include room renovations at the Boston Copley Place and the Westin
Seattle, as well as meeting and public space renovations at the
Swissotel Chicago. Fitch anticipates that coverage will improve
to between 2.5x and 3.0x over the next 12-to-24 months due to
rising group demand, and average rate growth coupled with food and
beverage revenue growth. In a more adverse case than anticipated
by Fitch, coverage could decline below 2.0x over the next 12-to-24
months, which would be commensurate with a rating lower than 'BB'.
Host's liquidity position is solid. For the period June 16, 2012
to Dec. 31, 2013, Fitch expects Host's sources of liquidity (cash,
availability under its revolving credit facility pro forma for the
series C senior notes offering, and projected retained cash flows
from operating activities after dividends and distributions) will
exceed uses of liquidity (debt maturities and amortization and
projected renewal and replacement capital expenditures) by 2.9x,
which is appropriate for the rating. Fitch estimates that Host
would have a 1.5x liquidity coverage ratio even with minimal
retained cash flow, which would be strong for the rating.
The company's unencumbered asset base provides further funding
flexibility, which Fitch views positively. Based on a range of
EBITDA multiples, unencumbered asset coverage of senior debt
ranges from 2.4x to 3.2x, with a midpoint of 2.8x, which Fitch
views as strong for the 'BB' rating level.
Host maintains a high-quality, geographically dispersed portfolio
of hotel properties, primarily in the luxury and upper upscale
hotel sectors, in the Americas, Europe, and Asia. As of June 15,
2012, 106 of Host's 120 hotels were unencumbered by mortgage debt,
providing significant financial flexibility and geographically
diverse cashflow streams. Year-to-date, Host has acquired the
Grand Hyatt Washington, D.C., acquired land for development in Rio
de Janeiro and Brazil, invested in the Hyatt Place, Nashville
joint venture and acquired Citigate Perth through its Asia/Pacific
joint venture.
The Stable Outlook centers on Fitch's expectation that Host's
credit profile will remain appropriate for the 'BB' rating through
economic cycles. The Stable Outlook also reflects the high
quality of Host's portfolio, solid unencumbered asset coverage,
and strong capital access and liquidity.
The following factors may result in positive momentum in the
ratings and/or Rating Outlook:
-- Sustained comparable RevPAR growth materially above Fitch's
initial 2012 forecast of positive 4% to 5%;
-- Fitch's expectation of net debt to recurring operating EBITDA
sustaining below 4.0x through economic cycles (pro forma
leverage is 4.5x);
-- Fitch's expectation of fixed charge coverage sustaining above
2.5x through economic cycles (pro forma coverage is 1.9x).
The following factors may result in negative momentum in the
ratings and/or Rating Outlook:
-- Fitch's expectation of net debt to recurring operating EBITDA
sustaining above 5.0x;
-- Fitch's expectation of fixed charge coverage sustaining below
1.5x;
-- A base case liquidity coverage ratio sustaining below 1.0x
(for June 16, 2012 to Dec. 31, 2013, base case pro forma
liquidity coverage is 2.9x).
HD SUPPLY: Issues $300 Million Additional 8.125% Senior Notes
-------------------------------------------------------------
HD Supply, Inc., issued $300 million aggregate principal amount
of its 8.125% Senior Secured First Priority Notes due 2019.
On April 12, 2012, the Company issued $950 million aggregate
principal amount of its 8.125% Senior Notes due 2019 under the
Base First Priority Indenture and the First Priority Supplemental
Indenture. The Additional First Priority Notes will be treated as
a single series with the Existing First Priority Notes and will
have the same terms as the Existing Fist Priority Notes. The
Additional First Priority Notes are entitled to the benefit of the
Exchange and Registration Rights Agreement, dated Aug. 2, 2012,
among the Company, the Subsidiary Guarantors and the initial
purchasers named therein.
The issue price of the Additional First Priority Notes was
107.500% of the principal amount, resulting in gross proceeds to
the Company of $322,500,000. The Company intends to use the
proceeds from the sale of the Additional First Priority Notes for
general corporate purposes and, pending such allocation, the
entire net proceeds will be applied to reduce outstanding
borrowings under its revolving ABL facility.
A copy of the Form 8-K is available for free at:
http://is.gd/5faiBY
About HD Supply
HD Supply, Inc., headquartered in Atlanta, Georgia, is one of the
largest North American wholesale distributors supporting
residential and non-residential construction and to a lesser
extent electrical consumption and repair and remodeling. HDS also
provides maintenance, repair and operations services. Its
businesses are organized around three segments: Infrastructure and
Energy; Maintenance, Repair & Improvement; and, Specialty
Construction. HDS operates through approximately 800 locations
throughout the U.S. and Canada serving contractors, government
entities, maintenance professionals, home builders and
professional businesses.
The Company reported a net loss of $543 million for the year ended
Jan. 29, 2012, a net loss of $619 million for the year ended
Jan. 30, 2011, and a net loss of $514 million on $6.94 billion of
net sales for the year ended Jan. 31, 2010.
The Company's balance sheet at April 29, 2012, showed
$6.32 billion in total assets, $7.10 billion in total liabilities
and a $780 million total stockholders' deficit.
* * *
As reported by the TCR on March 30, 2012, Moody's Investors
Service upgraded HD Supply, Inc.'s Corporate Family Rating to Caa1
from Caa2 and its Probability of Default Rating to Caa1 from Caa2.
This rating action reflects improvement in the company's
operations and improved credit metrics. Also, HDS is implementing
a refinancing of its existing capital structure which will extend
its maturity profile effectively by one year to 2015.
HD Supply carries a 'B' corporate credit rating, with
negative outlook, from Standard & Poor's Ratings Services.
HOSTESS BRANDS: Pension Funds Oppose Payment Delays
---------------------------------------------------
Rachel Feintzeig at Dow Jones' Daily Bankruptcy Review reports
that several pension funds are protesting Hostess Brands Inc.'s
bid to delay $45 million in payments, accusing the struggling
baking company of "impermissibly seeking a second bite at the
apple" after a judge ordered it to make the contributions.
About Hostess Brands
Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known
for iconic brands such as Butternut, Ding Dongs, Dolly Madison,
Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride,
Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution
centers and 570 outlets in 49 states.
Hostess filed for Chapter 11 bankruptcy protection early morning
on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through
12-22056) in White Plains, New York. Debtor-affiliates that filed
separate Chapter 11 petition are IBC Sales Corporation, IBC
Trucking LLC, IBC Services LLC, Interstate Brands Corporation, and
MCF Legacy Inc. Hostess Brands disclosed assets of $982 million
and liabilities of $1.43 billion as of Dec. 10, 2011. Debt
includes $860 million on four loan agreements. Trade suppliers
are owed as much as $60 million.
The bankruptcy filing was made two years after predecessors
Interstate Bakeries Corp. and its affiliates emerged from
bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). Ripplewood
Holding LLC, after providing $130 million to finance the plan,
obtained control of IBC's business following the prior
reorganization. Hostess Brands is privately held. The new owners
pursued new Chapter 11 cases to escape from what they called
"uncompetitive and unsustainable" union contracts, pension plans,
and health benefit programs.
In 2011, Hostess retained Houlihan Lokey to explore sales of its
smaller assets and individual brands. Houlihan Lokey oversaw the
sale of Mrs. Cubbison's to Sugar Foods Corporation for
$12 million, but was unable to sell any of Hostess' core assets.
Judge Robert D. Drain oversees the case. Hostess has hired Jones
Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general
corporate counsel and conflicts counsel; Perella Weinberg Partners
LP as investment bankers, FTI Consulting, Inc. to provide an
interim treasurer and additional personnel for the Debtors, and
Kurtzman Carson Consultants LLC as administrative agent.
Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry
Wilson, the head of turnaround and restructuring firm MAEVA
Advisors, are representing the Teamsters union.
Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain
Millers International Union and Bakery & Confectionery Union &
Industry International Pension Fund are Jeffrey R. Freund, Esq.,
at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David
A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright &
Jaworski L.L.P.
An official committee of unsecured creditors has been appointed in
the case. The committee selected New York law firm Kramer Levin
Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein
head the legal team for the committee.
HRK HOLDINGS: Taps Kynes Markman as Environmental Counsel
---------------------------------------------------------
HRK Holdings, LLC, and HRK Industries, LLC, ask for permission
from the U.S. Bankruptcy Court for the Middle District of Florida
to employ Kynes Markman & Felman, P.A., as environmental and
litigation special counsel, nunc pro tunc to the Petition Date.
Kynes Markman will, among other things:
a. review contracts, pleadings, discovery, responses, and
other legal documents;
b. provide advice with respect to the regulatory matters and
interfacing with state and federal regulators; and
c. prepare form, attend, and participate in hearings,
closings, meetings, and trials.
Kynes Markman will be paid $150-$400 per hour for its services.
Kynes Markman received a prepetition retainer of $2,500.
James E. Felman, Esq., an attorney at Kynes Markman, attests to
the Court that the firm is a "disinterested person" within the
meaning of Section 101(14) of the Bankruptcy Code.
About HRK Holdings
Based in Palmetto, Florida, HRK Holdings LLC owns roughly 675
contiguous acres of real property in Manatee County, Florida.
Roughly 350 acres of the property accommodates a phosphogypsum
stack system, called Gypstaks, a portion of which was used as an
alternate disposal area for the management of dredge materials
pursuant to a contract with Port Manatee and as authorized under
an administrative agreement with the Florida Department of
Environmental Protection. The remaining acres of usable land are
either leased to various tenants or available for sale. HRK
Industries holds various contracts and leases associated with the
Debtors' property.
HRK Holdings and HRK Industries LLC filed for Chapter 11
protection (Bankr. M.D. Fla. Case Nos. 12-09868 and 12-09869) on
June 27, 2012. Judge K. Rodney May oversees the case. Barbara A.
Hart, Esq., at Stichter, Riedel, Blain & Prosser, P.A., represents
the Debtors. HRK Holdings scheduled $33,366,529 in assets and
$26,069,208 in liabilities. The petitions were signed by William
F. Harley, III, managing member.
According to the Debtors, the bankruptcy filing was necessitated
by the immediate need to sell a portion of the remaining property
to create liquidity for (a) funding the urgent management of the
site-related environmental concerns; the benefit of creditors;
funding a litigation filed by the Debtors; and funding of expenses
related to additional sales of the remaining property.
INDEPENDENCE TAX III: Reports $6.7MM Net Income in March 31 Qtr.
----------------------------------------------------------------
Independence Tax Credit Plus L.P. III filed its quarterly report
on Form 10-Q, reporting net income of $6.73 million on $744,191 of
total revenues for the three months ended June 30, 2012, compared
with a net loss of $322,949 on $726,406 of total revenues for the
three months ended March 31, 2011.
The Partnership's balance sheet at June 30, 2012, showed
$12.59 million in total assets, $23.44 million in total
liabilities, and a partners' deficit of $10.85 million.
According to the regulatory filing, at June 30, 2012, the
Partnership's liabilities exceeded assets by $10.85 million and
for the three months ended June 30, 2012, the Partnership
recognized net income of $6.73 million, including the gain on sale
of properties of $6.85 million. "These factors raise substantial
doubt about the Partnership?s ability to continue as a going
concern."
A copy of the Form 10-Q is available for free at:
http://is.gd/tjTI4p
Independence Tax Credit Plus L.P. III, headquartered in New York
City, is a limited partnership which was formed under the laws of
the State of Delaware on Dec. 23, 1993. The general partner of
the Partnership is Related Independence Associates III L.P., a
Delaware limited partnership (the "General Partner"). The general
partner of the General Partner is Related Independence Associates
III Inc., a Delaware corporation. The ultimate parent of the
General Partner is Centerline Holding Company.
The Partnership's business is to invest in other partnerships
owning leveraged apartment complexes that are eligible for the
low-income housing tax credit enacted in the Tax Reform Act of
1986, some of which may also be eligible for the historic
rehabilitation tax credit.
INDEPENDENCE TAX: Swings to $14.8 Million Net Income Fiscal Q1
--------------------------------------------------------------
Independence Tax Credit Plus L.P. II filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing net income of $14.81 million on $198,607 of total
revenues for the three months ended June 30, 2012, compared with a
net loss of $4.64 million on $209,445 of total revenues for the
same period during the prior year.
The Company's balance sheet at June 30, 2012, showed $5.05 million
in total assets, $15.84 million in total liabilities and a $10.78
million total partners' deficit.
At June 30, 2012, the Partnership's liabilities exceeded assets by
$10,786,492 and for the three months ended June 30, 2012, had net
income of $14,816,162, including gain on sale of properties of
$14,957,262. These factors raise substantial doubt about the
Partnership's ability to continue as a going concern, according
the Form 10-Q.
A copy of the Form 10-Q is available for free at:
http://is.gd/paHuJL
About Independence Tax Credit Plus L.P. II
Based in New York, Independence Tax Credit Plus L.P. II was
organized on Feb. 11, 1992, and commenced its public offering on
Jan. 19, 1993. The general partner of the Partnership is Related
Independence Associates L.P., a Delaware limited partnership. The
general partner of Related Independence Associates L.P. is Related
Independence Associates Inc., a Delaware Corporation. The
ultimate parent of Related Independence Associates L.P. is
Centerline Holding Company.
The Partnership's business is primarily to invest in other
partnerships owning leveraged apartment complexes that are
eligible for the low-income housing tax credit enacted in the Tax
Reform Act of 1986, some of which may also be eligible for the
historic rehabilitation tax credit.
The Partnership is in the process of developing a plan to dispose
of all of its investments.
The Company reported a net loss of $237,376 for the year ended
March 31, 2012, compared with net income of $15.97 million during
the prior fiscal year.
INFUSYSTEM HOLDINGS: Conference Call for Q2 Results Today
---------------------------------------------------------
InfuSystem Holdings, Inc., was set to issue results for the second
quarter 2012 on Aug. 7, 2012, following the market close. The
Company will conduct a conference call for investors on Wednesday,
Aug. 8, 2012, at 9:00 a.m. Eastern Time to discuss second quarter
performance and results. To participate in this call, dial in
toll-free (888) 895-5271 and use the confirmation number 33012557.
About InfuSystem Holdings
InfuSystem Holdings, Inc., operates through operating
subsidiaries, including InfuSystem, Inc., and First Biomedical,
Inc. InfuSystem provides infusion pumps and related services.
InfuSystem provides services to hospitals, oncology practices and
facilities and other alternate site healthcare providers.
Headquartered in Madison Heights, Michigan, InfuSystem delivers
local, field-based customer support, and also operates pump
service and repair Centers of Excellence in Michigan, Kansas,
California, and Ontario, Canada.
After auditing the Company's 2011 financial statements, Deloitte &
Touche LLP, in Detroit, Michigan, said that the possibility of a
change in the majority representation of the Board and consequent
event of default under the Credit Facility, which would allow the
lenders to cause the debt of $24.0 million to become immediately
due and payable, raises substantial doubt about the Company's
ability to continue as a going concern.
The Company reported a net loss of $45.44 million in 2011,
compared with a net loss of $1.85 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$75.63 million in total assets, $36.09 million in total
liabilities and $39.53 million in total stockholders' equity.
JENNE HILL: Aug. 16 Hearing on Valuation of Wells Fargo Collateral
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Missouri,
according to Jenne Hill Townhomes, L.L.C.'s case docket continued
until Aug. 16, 2012, at 9 a.m., the hearing to consider Wells
Fargo Bank, N.A.'s request to determine value of its security.
Wells Fargo has requested that the Court establish the value of
its real property collateral as $9,710,000. Wells Fargo is the
holder of a claim secured principally by parcels of improved real
property in Columbia, Boone County, Missouri, the Debtor has
valued the real property collateral of Wells Fargo at $13,000,000.
Wells Fargo believes that the value of the real property is
significantly less than that amount.
The Court has granted orders authorizing the Debtor to use cash
collateral.
About Jenne Hill
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.
Plan payments and distributions under the Plan will be funded by
the Debtor's rental income from the Townhome Complex.
Under the Plan, Wells Fargo is entitled to interest of $3.27% per
annum on the 2008 note and 5.25% on the 2009 note. Wells Fargo's
secured claim of $9,607,243 will be amortized over 25 years with
interest at 5.5% per annum, which yields a monthly payment of
$58,996.
General unsecured claims in the aggregate amount of approximately
$23,203 will be paid in full in cash within 30 days of the
Effective Date of the confirmed Plan.
JEANNE BUSSARD CENTER: Maryland Seeks Receiver, Plans Reopening
---------------------------------------------------------------
The Associated Press reports that the Maryland Department of
Health and Mental Hygiene is seeking a role in the possible
reopening of a Frederick nonprofit that provided jobs and training
for the developmentally disabled.
The Frederick News-Post said that DHMH is seeking court-ordered
receivership for the Jeanne Bussard Center, according to The AP.
The report relates that a receiver would hold the center's assets
pending resolution of its status then a new organization could
take over.
The center closed abruptly July 5, The AP recalls. DHMH said it's
been told that the executive director was fired and the board of
directors resigned, according to The AP.
The report says that the U.S. Internal Revenue Service has filed
liens totaling more than $466,000 against the center. And DHMH
said the center is five years behind on its financial statements.
The department licenses the center to operate and provides a
portion of its funds.
K-V PHARMACEUTICAL: To Transition Shares Trading to OTC Markets
---------------------------------------------------------------
K-V Pharmaceutical Company (NYSE: KVa / KVb) disclosed that its
Class A and Class B common shares may be traded in the over the
counter (OTC) market following the Company?s suspension from the
New York Stock Exchange ("NYSE"). However, K-V cannot ensure that
either class of stock will be, or will continue to be, traded.
Trading in the OTC market may result in significantly lower
trading volumes and liquidity for investors seeking to buy or sell
shares of K-V?s common stock.
However, K-V cannot ensure that either class of stock will be, or
will continue to be, traded. Trading in the OTC market may result
in significantly lower trading volumes and liquidity for investors
seeking to buy or sell shares of K-V's common stock.
Earlier today, the Company received notice from the NYSE that
trading in its Class A and Class B common shares would be
suspended, pending delisting, following the Company's voluntary
filing for protection under Chapter 11 of the U.S. Bankruptcy Code
on Aug. 4, 2012. The Company will not be challenging the NYSE's
delisting action.
Court documents, claims forms and other documents related to K-V's
Chapter 11 can be found at http://dm.epiq11.com/KVD. Additional
information and frequently asked questions (FAQs) for shareholders
can be found at http://kvph.com.
About K-V Pharmaceutical Company
KV Pharmaceutical Company (NYSE: KVa/KVb) --
http://www.kvpharmaceutical.com/-- is a fully integrated
specialty pharmaceutical company that develops, manufactures,
markets, and acquires technology-distinguished branded and
generic/non-branded prescription pharmaceutical products. The
Company markets its technology distinguished products through
ETHEX Corporation, a subsidiary that competes with branded
products, and Ther-Rx Corporation, the company's branded drug
subsidiary.
K-V Pharmaceutical Company and certain domestic subsidiaries on
Aug. 4 filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead
Case No. 12-13346, under K-V Discovery Solutions Inc.) to
restructure their financial obligations.
K-V has retained the services of Willkie Farr & Gallagher LLP as
bankruptcy counsel, Williams & Connolly LLP as special litigation
counsel, and SNR Denton as special litigation counsel. In
addition, K-V has retained Jefferies & Co., Inc., as financial
advisor and investment banker. Epiq Bankruptcy Solutions LLC is
the claims and notice agent.
K-V Pharmaceutical said it continues to operate during the
reorganization.
LDK SOLAR: Director Rongqiang Cui Dies at 71
--------------------------------------------
LDK Solar Co., Ltd., announced that Professor Rongqiang Cui,
Director of LDK Solar's Laboratory at Shanghai Jiaotong
University, passed away at the age of 71.
Professor Cui joined LDK Solar in September 2005 as the Director
of LDK Solar's Laboratory at Shanghai Jiaotong University.
Professor Cui began solar energy research in 1971 and became the
Head of the Solar Research Institute of Shanghai Jiaotong
University in 1997. Previously, he was an assistant tutor,
lecturer and professor in the Physics Department of Xian Jiaotong
University from 1964 to 1996. Professor Cui graduated from the
Xian Jiaotong University in 1964 with a diploma in Engineering
Physics.
Management of the LDK Solar Laboratory at Shanghai Jiaotong
University will be assumed by Dr. Yuepeng Wan, LDK Solar's Chief
Technical Officer, along with his research team.
Mr. Xiaofeng Peng, Chairman and CEO of LDK Solar, stated, "It is
with deep sadness that we announce the passing of Professor Cui.
He was a valued member of the LDK family and will be sorely missed
by his colleagues."
About LDK Solar
LDK Solar Co., Ltd. -- http://www.ldksolar.com-- based in Hi-Tech
Industrial Park, Xinyu City, Jiangxi Province, People's Republic
of China, is a vertically integrated manufacturer of photovoltaic
products, including high-quality and low-cost polysilicon, solar
wafers, cells, modules, systems, power projects and solutions.
LDK Solar was incorporated in the Cayman Islands on May 1, 2006,
by LDK New Energy, a British Virgin Islands company wholly owned
by Xiaofeng Peng, LDK's founder, chairman and chief executive
officer, to acquire all of the equity interests in Jiangxi LDK
Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin
Industrial Limited.
KPMG in Hong Kong, China, said in a May 15, 2012, audit report,
there is substantial doubt on the ability of LDK Solar Co., Ltd.
to continue as a going concern. According to KPMG, LDK Solar has
a net working capital deficit and is restricted to incur
additional debt as it has not met a financial covenant ratio under
a long-term debt agreement as of Dec. 31, 2011. These conditions
raise substantial doubt about the Group's ability to continue as a
going concern.
The Company's balance sheet at March 31, 2012, showed US$6.63
billion in total assets, US$5.96 billion in total liabilities,
US$228.21 million in redeemable non-controlling interests and
US$447.32 million in total equity.
LIKE OAK DEVELOPMENT: Files for Chapter 11 in Houston
-----------------------------------------------------
Live Oak Development, Ltd., a Magnolia, Texas-based entity with
assets in excess of $10 million and debts less than $10 million,
filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 12-35873)
in Houston. A meeting of creditors is scheduled for Aug. 30, 2012
at 2:30 p.m. A court filing says that Investors Note Servicing,
Inc. has a $1.45 million claim against the Debtor, secured by
803 acres of land in Waller County, Texas. The property is worth
$5.7 million.
LIQUIDMETAL TECHNOLOGIES: Amends 79.2-Mil. Common Shares Offering
-----------------------------------------------------------------
Liquidmetal Technologies, Inc., filed with the U.S. Securities and
Exchange Commission amendment no. 1 to the Form S-1 covering an
aggregate of up to 79,261,370 shares of the Company's common
stock, $0.001 par value per share, that may be offered from time
to time by Kingsbrook Opportunities Master Fund LP, Hudson Bay
Master Fund Ltd., Empery Asset Master Ltd, Hartz Capital
Investments, LLC, and Iroquois Master Fund Ltd.
The shares being offered by this prospectus consist of:
* up to 51,136,370 shares issuable upon the conversion of the
Company's Senior Convertible Notes due on Sept. 1, 2013,
issued by the Company in connection with a private placement
in July 2012; and
* up to 28,125,000 shares issuable upon the exercise of the
common stock purchase warrants issued by the Company in its
July 2012 private placement.
This prospectus also covers any additional shares of common stock
that may become issuable upon any anti-dilution adjustment
pursuant to the terms of the Senior Convertible Notes due on
Sept. 1, 2013, or the common stock purchase warrants issued to the
selling stockholders by reason of stock splits, stock dividends,
and other events. The Senior Convertible Notes due on Sept. 1,
2013, and common stock purchase warrants were acquired by the
selling stockholders in a private placement by the Company that
closed on July 2, 2012.
The Company's common stock is currently quoted on the OTC Bulletin
Board under the symbol "LQMT." On July 11, 2012, the last
reported sales price of the Company's common stock was $0.281 per
share.
A copy of the amended Form S-1 is available for free at:
http://is.gd/0f14AB
About Liquidmetal Technologies
Based in Rancho Santa Margarita, Calif., Liquidmetal Technologies,
Inc., and its subsidiaries are in the business of developing,
manufacturing, and marketing products made from amorphous alloys.
Liquidmetal Technologies markets and sells Liquidmetal(R) alloy
industrial coatings and also manufactures, markets and sells
products and components from bulk Liquidmetal alloys that can be
incorporated into the finished goods of its customers across a
variety of industries. The Company also partners with third-
party licensees and distributors to develop and commercialize
Liquidmetal alloy products.
After auditing the 2011 financial statements, Choi, Kim & Park,
LLP, in Los Angeles, California, said that the Company's
significant operating losses and working capital deficit raise
substantial doubt about its ability to continue as a going
concern.
The Company's balance sheet at March 31, 2012, showed
$2.02 million in total assets, $4.86 million in total liabilities,
and a $2.84 million total shareholders' deficit.
LIVE OAK: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Live Oak Development, Ltd
12027 Water Oak Drive
Magnolia, TX 77354-6275
Bankruptcy Case No.: 12-35873
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Southern District of Texas (Houston)
Judge: Letitia Z. Paul
Debtor's Counsel: J. Craig Cowgill, Esq.
J. CRAIG COWGILL & ASSOCIATES, P.C.
8100 Washington, Suite 120
Houston, TX 77007
Tel: (713) 956-0254
Fax: (713) 956-6284
E-mail: jccowgill@cowgillholmes.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Michael Fitzmaurice, president.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Montgomery County -- $700,000
Rayborn C. Johnson, Jr., County Attorney
207 W. Phillips, First Floor
Conroe, TX 77301
Colonial Pacific Leasing -- $400,000
Assignee Meyer Knight & Williams, LLP
8100 Washington Avenue, Suite 1000
Houston, TX 77007-1059
Law Offices Of Keith Woods -- $39,534
P.O. Box 341
Barker, TX 77413-0341
Berg-Oliver Assoc., Inc. -- $29,780
Steve E. Weil & Co., PC -- $27,466
SurvTech Corp. -- $23,037
Dodson & Assoc., Inc. -- $7,786
Sherrington, Inc. -- $5,602
Bays & Bays -- $4,975
Internal Revenue Service -- $4,271
Houston Chronicle -- $4,186
Hughes Natural Gas, Inc. -- $3,500
Outdoordecor.com -- $2,359
Waukesha-Pearce -- $2,264
HRA Gray Pape LLC -- $1,685
Randy C. Fletcher -- $1,650
William Scotsman -- $1,517
Magnolia Sign Source -- $1,288
Moore Concepts, Ltd. -- $650
Broadview Security -- $545
LSP ENERGY: Stalking Horse Denied; Auction Reopened
---------------------------------------------------
Jamie Santo at Bankruptcy Law360 reports that the Chapter 11
auction for LSP Energy LP officially reopened Friday after a
Delaware bankruptcy judge signed off an order rejecting an 11th-
hour stalking horse agreement and establishing a revised sales
schedule.
Bankruptcy Law360 relates that the order restores the level
playing field upset last month by LSP's announcement of the
$249 million deal with South Mississippi Electric Power
Association, inked just two days before binding offers were due.
About LSP Energy
LSP Energy Limited Partnership, LSP Energy, Inc., LSP Batesville
Holding, LLC, and LSP Batesville Funding Corporation filed
separate Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case
No. 12-10460) on Feb. 10, 2012.
LSP owns and operates an electric generation facility located in
Batesville, Mississippi. The Facility consists of three gas-fired
combined cycle electric generators with a total generating
capacity of roughly 837 megawatts and is electrically
interconnected into the Entergy and Tennessee Valley Authority
transmission systems. LSP's principal assets are the Facility and
the 58-acre parcel of real property on which it is located, as
well as its rights under a tolling agreements.
LSP filed bankruptcy to complete an orderly sale of its assets or
the ownership interests of LSP Holding in LSP, LSP Energy and LSP
Funding for the benefit of all stakeholders. The remaining three
Debtors filed bankruptcy due to their relationship as affiliates
of LSP and their ultimate obligations on a significant portion of
LSP's secured bond debt. The Debtors also suffered losses due to
a mechanical failure of a combustion turbine at their facility and
resultant business interruption.
LSP Energy is the general partner of LSP. LSP Holding is the
limited partner of LSP and the 100% equity holder of LSP Energy
and LSP Funding. LSP Funding is a co-obligor on the Debtors' bond
debt, and each of LSP Energy and LSP Holding has pledged their
equity interests in LSP and LSP Funding as collateral for the bond
debt.
No statutorily authorized creditors' committee has yet been
appointed in the Debtors' cases by the United States Trustee.
Judge Mary F. Walrath oversees the case. Lawyers at Whiteford
Taylor & Preston LLC serve as the Debtors' counsel.
MANHATTAN BRIDGE: Receives 180 Days Delisting Notice From NASDAQ
----------------------------------------------------------------
Manhattan Bridge Capital, Inc. has received from the NASDAQ Stock
Market a 180 days' notice of delisting for failure to maintain a
minimum $1.00 closing bid price per share for the Company's common
stock for the last 30 consecutive business days, as required for
continued listing under Nasdaq Listing Rule 5550(a)(2).
The Company has a period of 180 calendar days, or until
Feb. 4, 2013, to regain compliance with continued listing
standards.
To regain compliance with the minimum bid price requirement, the
closing bid price of the Company's common stock must be at $1.00
per share or more for a minimum of ten consecutive business days.
If, by Feb. 4, 2013, the Company does not regain compliance with
Nasdaq Listing Rule 5550(a)(2), it will receive written
notification that its securities are subject to delisting.
At that time, the Company may appeal the delisting determination
to a Nasdaq Hearings Panel. Alternatively, the company may be
eligible for an additional grace period if it meets the initial
listing standards, with the exception of bid price, for the Nasdaq
Capital Market.
If it meets initial listing criteria, the Nasdaq staff will notify
the Company that it has been granted an additional 180 calendar
day compliance period.
"The company intends to retain its Nasdaq listing and will take
all steps reasonably required to do so, stated Assaf Ran, Chairman
of the Board and CEO.
Manhattan Bridge Capital, Inc. --
http://www.manhattanbridgecapital.com-- provides short term,
secured, non-banking, commercial loans to small businesses.
MARKWEST ENERGY: Fitch Rates New $500MM Sr. Unsecured Notes 'BB'
----------------------------------------------------------------
Fitch Ratings assigns MarkWest Energy Partners, L.P.'s proposed
issuance of $500 million senior unsecured notes due 2023 'BB'.
The new notes are to rank pari passu with the company's senior
unsecured debt. Proceeds are to be used to reduce revolver
borrowings and for general partnership purposes such as funding
capital expenditures and working capital requirements.
Fitch currently rates MarkWest as follows:
-- Long-term Issuer Default Rating (IDR) 'BB';
-- Senior unsecured revolving credit facility 'BB+';
-- Senior unsecured debt 'BB'.
Key rating factors which support the rating include:
-- A reasonably geographically diverse footprint with leading
positions in the liquids-rich areas in the Mid-continent and
Appalachia;
-- Strategically well-positioned assets with exposure to the
rapidly growing Marcellus Shale;
-- An increasing amount of fee-based revenue sources and a
layered hedging strategy;
-- A strategy to fund growth with a combination of debt and
equity.
The ratings also factor in the following concerns:
-- Increased leverage which should decrease over the next few
quarters;
-- A significant percentage of non-fee-based cash flows from
keep-whole and percent-of-proceeds arrangements;
-- Reliance on drilling and production activities in the E&P
sector for gathering and processing volumes, which in turn
are ultimately driven by volatile hydrocarbon prices;
-- A capital expenditure program which has been growing
significantly;
-- Use of a hedging strategy which includes proxy hedging that
can be affected by the periodic breakdown in the correlation
between crude oil and natural gas liquids (NGL) prices.
Leverage: At the end of the second quarter of 2012 (2Q'12), debt
to adjusted leverage (defined as debt to adjusted EBITDA) was
4.0x, which was an improvement from the 4.1x at the end of 2011.
With the additional $500 million of proposed notes, 2Q'12 leverage
would increase to 5.0x on a pro forma basis.
Fitch anticipates that leverage should remain below 4.75x by the
end of 2012 which is above prior expectations. This revision is
driven by lower expectations for EBITDA in 2012 due to weak NGL
prices. With higher volumes and increases in fixed-fee contracts
next year, Fitch believes leverage should be below 4.0x by the end
of 2013.
Adequate Liquidity: At the end of 2Q'12, MarkWest had $1.1 billion
of liquidity which consisted of $122 million of cash and $960
million available on its revolving bank facility which extends
until 2017.
Fitch considers the current revolver's size and the company's
financial flexibility to be adequate to meet MarkWest's liquidity
needs. The next debt maturity will occur in 2018.
Acquisitions: MarkWest has been growing significantly over the
last couple of years and acquisitions have been a component of
company strategy.
During 2011, the company acquired the remaining 49% stake in the
MarkWest Liberty Midstream joint venture from The Energy Minerals
Group (EMG) for $1 billion in cash and 19.95 million class B
units. In May 2012, MarkWest acquired Keystone Midstream for $510
million. MarkWest raised net equity proceeds of $427 million to
partially fund the acquisition.
Capital Expenditures: With the announcement of the Keystone
acquisition, MarkWest forecasts spending in 2012 to be in the
range of $1.1 billion to $1.5 billion.
In 2011, capital expenditures were much lower at $551 million.
The significant increase in 2012's projected spending over 2011 is
a result of MarkWest's 100% ownership of Liberty versus its
previous stake of 51%, spending associated with Keystone expansion
projects, and other organic growth opportunities.
Distributable Cash Flow and Coverage: Distributable cash flow
(DCF) in the recent quarter increased to $91 million from $83
million in the year ago period. The distribution coverage for the
latest 12-month period ending June 30, 2012 was healthy at 1.2x,
which was unchanged from the end of 2011.
MarkWest lowered its guidance for 2012 DCF. It now expects it to
be in the range of $400 million to $440 million. The prior
forecast was a range of $440 million to $500 million. In 2011,
DCF was $333 million.
Hedging: The company uses some direct product hedges as well as a
proxy hedging strategy which is vulnerable to a periodic breakdown
in the correlation between crude oil and NGLs. At the end of
2Q'12, about half of its hedges for 2014 were direct product
hedges. At the end of 1Q'12 (latest available), 65% of its
contracts were hedged for 2012, approximately 55% for 2013, and
27% for 2014.
Fee-Based Contracts: As of 2Q'12, 44% of net operation margin was
fee-based and MarkWest projects it to increase to 50% by the end
of 2012 and 60% by the end of 2014.
What Could Trigger A Rating Action
Positive: Future developments that may, individually or
collectively, lead to positive rating action include:
-- A significant decrease in leverage over a sustained period of
time.
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- Leverage (defined as debt to adjusted EBITDA) in excess of
5.0x on a sustained basis.
-- Higher leverage either for high multiple acquisitions or to
fund growth projects above and beyond planned debt increases.
MARKWEST ENERGY: Moody's Rates New $500MM Sr. Unsec. Notes 'Ba3'
----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to MarkWest Energy
Partners, L.P.'s and MarkWest Energy Finance Corporation's
proposed $500 million senior unsecured notes due 2023. The Ba2
Corporate Family Rating (CFR) is unchanged and the outlook remains
stable. MarkWest plans to use the proceeds of the proposed note
offering to reduce borrowings under its senior secured credit
facility and for general corporate purposes.
Ratings Rationale
"The new bond issuance by MarkWest is consistent with their stated
policy to use a combination of debt and equity to fund their
expansion projects," said Stuart Miller, Moody's Vice President -
Senior Credit Officer. "Having issued over $800 million of equity
so far this year, we view this new debt issuance as credit-
neutral. More important to the future direction of MarkWest's
credit rating is the continuation of its string of announcements
of new long-term, fee-based agreements with natural gas
producers."
The Ba3 rating on the senior unsecured notes reflects both the
overall probability of default of MarkWest, to which Moody's
assigns a PDR of Ba2, and a loss given default of LGD4 (65%).
MarkWest's senior unsecured notes are subordinated to any
borrowings under the company's $1.2 billion senior secured
revolving credit facility. Because of their structurally junior
position, MarkWest's senior unsecured notes are rated one-notch
below the Ba2 CFR, consistent with Moody's Loss Given Default
Methodology.
MarkWest's Ba2 CFR incorporates Moody's expectation for continued
fee-based expansion in the company's current geographic footprint.
It is also based on Moody's expectation for negative free cash
flow into the foreseeable future along and varying levels of
exposure to commodity price and throughput risk. Like many
midstream master limited partnerships, MarkWest has substantial
negative free cash flow because of significant growth capital
expenditures and because a high percentage of funds from
operations are distributed to unit holders.
Despite recent fee-based contract announcements, MarkWest remains
exposed to commodity price risk through its gas processing
contracts and to volume risk associated with production decline
rates and third-party drilling activity levels. To address these
risks and to maintain financial flexibility, MarkWest uses a
balance of equity and debt to finance growth while maintaining its
ratio of debt to EBITDA below 4.0x. At March 31, 2012, the ratio
of debt to EBITDA was 3.25x using Moody's standard debt
adjustments.
To satisfy its short term liquidity needs, MarkWest relies on its
senior secured revolving credit facility. In June 2012, the
partnership amended its credit facility to increase the amount to
$1.2 billion and to extend the maturity until September 2017. Pro
forma for the new note offering, Moody's expects the full amount
of the credit facility to be available to fund capital
expenditures and/or distributions to unit holders. Therefore, near
term liquidity is adequate.
A near term upgrade in the partnership's rating is unlikely given
the expectation for negative free cash flow and exposure to
commodity and volume risk. To be considered for any additional
positive rating actions, MarkWest needs to increase the proportion
of its operating income generated through fee-based contracts
while maintaining leverage below 3.5x. Alternatively, a negative
action could result if leverage increases to 4.5x either due to
the issuance of additional debt or a fall off in operating
performance.
The principal methodology used in rating MarkWest Energy Partners,
L.P. was the Global Midstream Energy rating methodology published
in November 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.
MarkWest Energy Partners, L.P. is headquartered in Denver,
Colorado. MarkWest has geographic diversity and is one of the
largest gas gatherers and processors in the Granite Wash, the
Woodford Shale, and in the Marcellus Shale.
MARKWEST ENERGY: S&P Rates New $500M Sr. Unsecured Notes 'BB'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' issue rating
and '4' recovery rating to MarkWest Energy Partners L.P.'s and
MarkWest Energy Finance Corp.'s $500 million senior unsecured
notes offering due 2023. "The '4' recovery rating indicates our
expectation of average (30% to 50%) recovery if a payment default
occurs. The partnership intends to use proceeds to repay
borrowings under its revolving credit facility and for general
corporate purposes, including funding growth capital spending and
general working capital," S&P said.
"We base our rating on the partnership's 'fair' business risk
profile and 'significant' financial risk profile. Under our base-
case forecast, we expect total adjusted debt to EBITDA of about 4x
for 2012, using our natural gas liquid (NGL) price assumption of
86 cents per gallon and an NGL to crude price relationship of 42%
(with crude at $85 per barrel). Our projected financial leverage
forecast assumes MarkWest will fund capital spending at the high
end of the partnership's 2012 guidance range of $1.1 billion to
$1.5 billion with a balance of debt and equity. This ratio could
be higher than 4x through the end of the year, depending on the
timing of future equity offerings," S&P said.
"As of June 30, 2012, MarkWest had about $2 billion in debt, a
debt to EBITDA ratio of about 3.5x, and adequate liquidity," S&P
said.
RATINGS LIST
MarkWest Energy Partners L.P.
Corp. credit rating BB/Stable/--
New Ratings
MarkWest Energy Partners L.P.
MarkWest Energy Finance Corp.
$500 mil sr unsecd notes due 2023 BB
Recovery rating 4
MAUI LAND: Files Form 10-Q, Incurs $1-Mil. Net Loss in Q2
---------------------------------------------------------
Maui Land & Pineapple Company, Inc., filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing a net loss of $1.03 million on $3.45 million of
total operating revenues for the three months ended June 30, 2012,
compared with a net loss of $2.46 million on $3.81 million of
total operating revenues.
The Company reported a net loss of $1.27 million on $8.76 million
of total operating revenues for the six months ended June 30,
2012, compared with net income of $9.96 million on $7.66 million
of total operating revenues for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $62.52
million in total assets, $89.37 million in total liabilities and a
$26.84 million stockholders' deficiency.
The Company said in the Form 10-Q that its cash outlook for the
next twelve months and its ability to continue to meet its
financial covenants is highly dependent on selling certain real
estate assets in a difficult market and its ability to refinance
its debt. If the Company is unable to restructure its credit
agreements to extend the maturity dates beyond May 2013, the
Company would not have sufficient liquidity to repay those
outstanding borrowings. In addition, the Company is subject to
several purchase commitments and contingencies that could
negatively impact its future cash flows, including commitments of
up to $35 million to purchase the spa, beach club improvements and
the sundry store of Kapalua Bay Holdings, LLC (Bay Holdings), a
U.S. Equal Employment Opportunity Commission (EEOC) matter related
to the Company's discontinued agricultural operations, and funding
requirements related to the Company's defined benefit pension
plans.
A copy of the Form 10-Q is available for free at:
http://is.gd/4X0V7z
About Maui Land & Pineapple Co.
Maui Land & Pineapple Company, Inc. (NYSE: MLP) --
http://mauiland.com/-- develops, sells, and manages residential,
resort, commercial, and industrial real estate. The Company owns
approximately 23,000 acres of land on Maui and operates retail,
utility operations, and a nature preserve at the Kapalua Resort.
The Company's principal subsidiary is Kapalua Land Company, Ltd.,
the operator and developer of Kapalua Resort, a master-planned
community in West Maui.
Following the financial results for the year ended Dec. 31, 2011,
the Company's independent auditors expressed substantial doubt
about the Company's ability to continue as a going concern.
Deloitte & Touche LLP, in Honolulu, Hawaii, noted that the
Company's recurring negative cash flows from operations and
deficiency in stockholders' equity raise substantial doubt
about the Company's ability to continue as a going concern.
MBS MANAGEMENT: Can't Recoup $156K Bills to MXEnergy
----------------------------------------------------
Brian Mahoney at Bankruptcy Law360 reports that a requirements
contract for supplying electricity qualifies as a forward contract
and is therefore exempt from preference actions in bankruptcy, the
Fifth Circuit ruled Wednesday, agreeing with a lower court that a
bankrupt property manager can't recoup electricity payments from
its utilities supplier.
In a published opinion Wednesday, a three-judge panel said MBS
Management Services Inc., which manages apartments in Louisiana
and Texas, can't recoup $156,345.93 in bills to MXEnergy Electric
Inc. because the payments were a type of forward contract exempt
from avoidance actions, according to Bankruptcy Law360.
About MBS Management
Metairie, Louisiana-based MBS Management Services Inc. and its
affiliates broker and manage multifamily properties. MBS
Management provides the real estate debtors with leasing,
maintenance coordination, on-site and regional management.
In most instances, MBS Management has engaged Gray Star or Lincoln
Property Company to handle the property management for the Real
Estate Debtors.
MBS Management and its affiliates filed for chapter 11 bankruptcy
on Nov. 5, 2007 (Bankr. E.D. La. Lead Case No. 07-12151). Tristan
E. Manthey, Esq., Jan Marie Hayden, Esq., and Douglas S. Draper,
Esq. at Heller, Draper, Hayden, Patrick & Horn and Patrick S.
Garrity, Esq., and William E. Steffes, Esq., at Steffes Vingiello
& McKenzie LLC, represent the Debtors in their restructuring
efforts. The Debtors disclosed to the Court $12,299,366 in total
assets and $9,461,174 in total debts.
MBS-South Point Apartments, an affiliate of the Debtor that owns a
128-unit apartment in Desoto, Texas, filed for Chapter 11
protection on Nov. 19, 2007 (Bankr. E.D. La. Case No. 07-12283).
MBS-The Trails Ltd. and MBS-Fox Chase Ltd., affiliates of the
Debtor, filed separate chapter 11 petition on Dec. 4, 2007 (Bankr.
N.D. Tex. Case Nos. 07-45430 and 07-45431, respectively). These
affiliates estimated assets and debts between $1 million and
$10 million when they filed for bankruptcy.
Following confirmation of the Chapter 11 Plan, MBS transferred all
rights to avoid preferential or fraudulent conveyances to a
litigation trust for prosecution. Claude Lightfoot was named
Trustee of the MBS Unsecured Creditors' Trust.
MEDIA GENERAL: Files Form 10-Q, Incurs $146.3MM Net Loss in Q2
--------------------------------------------------------------
Media General, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $146.29 million on $84.11 million of total revenues for the
three months ended June 24, 2012, compared with a net loss of
$15.38 million on $71.72 million of total revenues for the three
months ended June 26, 2011.
The Company reported a net loss of $180.72 million on
$159.23 million of total revenues for the six months ended
June 24, 2012, compared with a net loss of $41.18 million on
$139.01 million of total revenues for the six months ended June
26, 2011.
The Company's balance sheet at June 24, 2012, showed $923.41
million in total assets, $1.05 billion in total liabilities and a
$129.26 million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/NUYpq1
About Media General
Richmond, Virginia-based Media General Inc. (NYSE: MEG) --
http://www.mediageneral.com/-- is an independent communications
company with interests in newspapers, television stations and
interactive media in the United States.
The Company reported a net loss of $74.32 million for the fiscal
year ended Dec. 25, 2011, a net loss of $22.64 million for the
fiscal year ended Dec. 26, 2010, and a net loss of $35.76 million
for the fiscal year ended Dec. 27, 2009.
* * *
As reported by the Troubled Company Reporter on April 12, 2012,
Moody's Investors Service downgraded, among other things, Media
General's Corporate Family Rating (CFR) and Probability of Default
Rating (PDR) to Caa1 from B3, concluding the review for downgrade
initiated on Feb. 13, 2012. The downgrade reflects the
significant increase in interest expense associated with the
company's credit facility amend and extend transaction and an
assumed issuance of at least $225 million of new notes, which will
result in limited free cash flow generation and constrain Media
General's capacity to reduce its very high leverage. The weak
free cash flow and high leverage create vulnerability to changes
in the company's highly cyclical revenue and EBITDA generation.
According to the May 23, 2012 edition of the TCR, Standard &
Poor's Ratings Services placed its 'CCC+' corporate credit rating
on Media General, along with its 'CCC+' issue-level rating on the
company's senior secured notes, on CreditWatch with positive
implications.
"The CreditWatch placement is based on Media General's agreement
to sell the majority of its newspaper assets to BH Media Group, a
subsidiary of Berkshire Hathaway Inc. The CreditWatch also
reflects the announcement that the company will refinance its
existing bank debt due in March 2013. It expects to close the
refinancing transaction next week and the newspaper sale by June
25, 2012," S&P said.
MERCATOR MINERALS: Had $20.5 Million Net Loss in 1st Quarter
------------------------------------------------------------
Mercator Minerals Ltd. reported a net loss of US$20.49 million on
US$65.24 million of revenue for the three months ended March 31,
2012, compared with a net loss of US$6.20 million on
US$55.84 million of revenue for the comparable period of 2011.
The Company's balance sheet at March 31, 2012, showed
US$605.34 million in total assets, US$331.44 million in total
liabilities, and total equity of US$273.90 million.
The Company had as at March 31, 2012, an accumulated deficit of
US$147.99 million (Dec. 31, 2011 - US$133.33 million) and working
capital deficiency of US$54.07 million (Dec. 31, 2011 - working
capital deficiency of US$116.33 million).
"The working capital deficiency at Dec. 31, 2011, includes certain
overdue accounts payable totaling US$20.6 million. At March 31,
2012, the overdue accounts payable totaled US$21.2 million.
During 2011, the Company experienced a delay in completion of the
Phase 2 expansion at Mineral Park Mine and incurred costs in
excess of the planned capital project costs. This resulted in a
delay in achieving the expected incremental increase in sales and
resulted in an increase in overdue accounts payable. Management
has had discussions with certain vendors and has verbally agreed
to suitable payment arrangements with respect to the overdue
amounts. Management anticipates the incremental increase in sales
revenue from the Phase 2 expansion to generate sufficient cash
flow to become current with all vendors by the third quarter of
2012. There can be no assurances the Company will be able to meet
its planned operating results or that the Company's vendors will
not demand repayment of the overdue amounts."
"This unaudited condensed consolidated interim financial
statements have been prepared on a going concern basis which
assumes that the Company will be able to realize its assets and
discharge its liabilities in the normal course of business for the
foreseeable future. However, the uncertainty with respect to the
Company's ability to meet its operating objectives and settle the
Company's liabilities including the overdue accounts payable casts
substantial doubt about the Company's ability to continue as a
going concern."
A copy of the Condensed Consolidated Interim Financial Statements
for the period ended March 31, 2012, is available for free at
http://is.gd/0B3zc9
Based in Vancouver, B.C., Mercator Minerals Ltd. (TSX: ML) is a
copper, molybdenum and silver producer with a diversified
portfolio of high quality assets in the USA and Mexico. Mercator
provides investors exposure to current copper, molybdenum and
silver production from the large tonnage long life Mineral Park
Mine in Arizona, as well as mid-term exposure to potential copper
production from its El Pilar deposit in the State of Sonora in
northern Mexico and longer term exposure of molybdenum and copper
through the potential development of the El Creston deposit also
in the State of Sonora in northern Mexico.
MF GLOBAL: Trustees Disagree Over Amount to Return to Customers
---------------------------------------------------------------
Jamila Trindle at Dow Jones' Daily Bankruptcy Review reports that
the trustee in charge of returning money to customers from the
bankrupt MF Global Holdings Ltd. said customers should get around
90% of their money back, striking a more-cautious note than
another bankruptcy trustee who expressed confidence that customers
will get all their money back.
About MF Global
New York-based MF Global (NYSE: MF) -- http://www.mfglobal.com/--
was one of the world's leading brokers of commodities and listed
derivatives. MF Global provided access to more than 70 exchanges
around the world. The firm was also one of 22 primary dealers
authorized to trade U.S. government securities with the Federal
Reserve Bank of New York. MF Global's roots go back nearly 230
years to a sugar brokerage on the banks of the Thames River in
London.
MF Global Holdings Ltd. and MF Global Finance USA Inc. filed
voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059
and 11-5058) on Oct. 31, 2011, after a planned sale to Interactive
Brokers Group collapsed.
As of Sept. 30, 2011, MF Global had $41,046,594,000 in total
assets and $39,683,915,000 in total liabilities.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
Louis J. Freeh was named the Chapter 11 Trustee for the
bankruptcy cases of MF Global Holdings Ltd. and its affiliates.
The Chapter 11 Trustee tapped (i) Freeh Sporkin & Sullivan LLP,
as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee has retained Capstone Advisory Group LLC
as financial advisor.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
MMODAL INC: S&P Gives 'B+' Corporate Credit Rating; Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'B+'
corporate credit rating to Franklin, Tenn.-based MModal Inc. The
outlook is stable.
"We also assigned a preliminary 'BB-' issue-level ratings and
preliminary '2' recovery ratings to MModal's proposed $515 million
senior secured credit facilities, which consist of a $75 million
revolving credit facility due 2017 and a $440 million term loan
due 2019. The preliminary '2' recovery rating indicates our
expectations for substantial (70%-90%) recovery in the event of
payment default," S&P said.
"Additionally, we assigned a preliminary 'B-' issue-level rating
and a preliminary '6' recovery rating to the company's proposed
$250 million senior unsecured notes due 2020. The preliminary '6'
recovery rating indicates our expectations for negligible (0%-10%)
recovery in the event of payment default," S&P said.
"MModal intends to use the debt proceeds, along with $447 million
of equity contribution of One Equity Partners, to repay existing
debt and to fund the leveraged buyout of the company," S&P said.
"The ratings on MModal reflect our view that an aggressive
financial profile following its LBO is partly offset by an
increasing adoption of technology for clinical documentation, a
recurring revenue base, high renewal rates, and a diversified
customer base," said Standard & Poor's credit analyst David Tsui.
"We view MModal's business risk profile as 'weak' as it has a
narrow focus on the generally fragmented U.S. clinical
documentation industry, which includes a more diversified director
competitor with greater financial resources. We view the company's
financial risk profile as 'aggressive,' with pro forma adjusted
debt-to-EBITDA at 5.3x at closing of the LBO transaction, which is
likely to decline to about 5x in the near term."
MModal is a leading provider of clinical narrative capture
services, speech and natural language understanding technology,
and clinical documentation workflow solutions to the U.S. health
care industry.
"The outlook is stable, reflecting our view that the company's
highly recurring revenue base and diversified customer base will
continue to support consistent and improving revenue generation
and profitability, leading to modest leverage declines over the
near term. An ownership structure that we believe precludes
material and sustained reduction in debt currently limits the
potential for an upgrade," S&P said.
"We could lower the rating if competitive pressure intensifies,
leading to significantly lower-than-expected revenue growth or a
deterioration in EBITDA margins, and leverage increasing to and
sustained at the mid-5x level," S&P said.
MMRGLOBAL INC: Can Borrow up to $4.5MM Under Amended RHL Note
-------------------------------------------------------------
MMRGlobal, Inc., its subsidiary MyMedicalRecords, Inc., and The
RHL Group, Inc., entered into a Seventh Amended and Restated
Promissory Note, effective as of July 30, 2012. The Amended Note
amends and restates the Sixth Amended and Restated Promissory Note
effective April 29, 2012, by:
(i) increasing the amount available under the Credit Facility
from $3,000,000 to $4,500,000 to accommodate additional
financing needs of the Company; and
(ii) granting The RHL Group the right to convert, at any time
following the date of the Amended Note, up to an aggregate
of $500,000 in outstanding principal of the Credit Facility
into shares of the Company's Common Stock at a conversion
price of $0.02 per share.
The amendment did not change the maturity date of the Existing
Note which is due to mature on April 29, 2013.
There were no loan origination fees charged by, or warrants issued
to, The RHL Group with respect to the Amended Note. The Amended
Note does not materially alter the terms of the Existing Note.
The RHL Group is a significant stockholder of the Company and is
wholly-owned by Robert H. Lorsch, Chairman, Chief Executive
Officer and President of the Company and MMR. Historically, the
predecessor notes have, over time, increased the maximum amount of
credit available under the Credit Facility from $100,000 to
$1,000,000 to $3,000,000. The maximum amount of the Amended Note
is $4,500,000. The Amended Note continues to bear interest at the
lesser of 10% or the highest rate then permitted by law, and is
secured (similar to the Existing Note) by a Security Agreement,
which has been in effect since July 31, 2007, as renewed and
amended to date. As of June 27, 2012, the Amended Note had an
Unpaid Balance of $2,299,445, which was increased to $3,314,074 in
July.
About MMRGlobal
Los Angeles, Calif.-based MMR Global, Inc. (OTC BB: MMRF)
-- http://www.mmrglobal.com/-- through its wholly-owned operating
subsidiary, MyMedicalRecords, Inc., provides secure and easy-to-
use online Personal Health Records (PHRs) and electronic safe
deposit box storage solutions, serving consumers, healthcare
professionals, employers, insurance companies, financial
institutions, and professional organizations and affinity groups.
In the auditors' report accompanying the financial statements for
year ended Dec. 31, 2011, Rose, Snyder & Jacobs LLP, in Encino,
California, expressed substantial doubt about the Company's
ability to continue as a going concern. The independent auditors
noted that the Company has incurred significant operating losses
and negative cash flows from operations during the years ended
Dec. 31, 2011, and 2010.
The Company reported a net loss of $8.88 million in 2011, compared
with a net loss of $17.90 million in 2010. The Company reported a
net loss of $10.3 million in 2009.
The Company's balance sheet at March 31, 2012, showed
$1.90 million in total assets, $7.96 million in total liabilities,
and a $6.05 million stockholders' deficit.
MOHEGAN TRIBAL: Reports $9-Mil. Net Income in Fiscal 3rd Quarter
----------------------------------------------------------------
The Mohegan Tribal Gaming Authority reported net income of $9.02
million on $344.43 million of net revenues for the three months
ended June 30, 2012, compared with net income of $28.66 million on
$361.37 million of net revenues for the same period during the
prior year.
For the nine months ended June 30, 2012, the Company reported net
income of $47.30 million on $1.04 billion of net revenues,
compared to income of $65.88 million on $1.04 billion of net
revenues for the same period a year ago.
As of June 30, 2012, the Authority held cash and cash equivalents
of $120.5 million compared to $112.2 million as of Sept. 30, 2011.
As of June 30, 2012, no amount was drawn on the Authority's $75.0
million revolving bank credit facility. As of June 30, 2012,
letters of credit issued under the Authority's bank credit
facilities totaled $2.3 million, of which no amounts were drawn.
Inclusive of letters of credit, which reduce borrowing
availability under the Authority's bank credit facilities, and
after taking into account restrictive financial covenant
requirements, the Authority had approximately $72.7 million of
borrowing capacity under its bank credit facilities as of June 30,
2012. As of June 30, 2012, the Authority's debt, including
capital leases, totaled $1.66 billion compared to $1.64 billion as
of Sept. 30, 2011.
"Our third quarter operating results were lackluster," said
Mitchell Grossinger Etess, Chief Executive Officer of the
Authority. "We faced difficult year-over-year comparisons,
persisting economic concerns and significant new supply in the
marketplace. However, Mohegan Sun at Pocono Downs continued to
perform well, and we recently broke ground on our new hotel and
convention center, which will further add to the property's
profitability in the future. In addition, we continue to manage
expenses and develop marketing strategies in response to current
market conditions."
A copy of the press release is available for free at:
http://is.gd/BvmlNU
About Mohegan Tribal Gaming Authority
Mohegan Tribal Gaming Authority -- http://www.mtga.com/-- is an
instrumentality of the Mohegan Tribe of Indians of Connecticut, or
the Tribe, a federally-recognized Indian tribe with an
approximately 507-acre reservation situated in Southeastern
Connecticut, adjacent to Uncasville, Connecticut. The Authority
has been granted the exclusive authority to conduct and regulate
gaming activities on the existing reservation of the Tribe,
including the operation of Mohegan Sun, a gaming and entertainment
complex located on a 185-acre site on the Tribe's reservation.
Through its subsidiary, Downs Racing, L.P., the Authority also
owns and operates Mohegan Sun at Pocono Downs, a gaming and
entertainment facility located on a 400-acre site in Plains
Township, Pennsylvania, and several off-track wagering facilities
located elsewhere in Pennsylvania.
PricewaterhouseCoopers LLP, in Hartford, Connecticut, expressed
substantial doubt about the Authority's ability to continue as a
going concern following the 2011 annual report. The independent
auditors noted that of the Authority's total debt of $1.6 billion
as of Sept. 30, 2011, $811.1 million matures within the next
twelve months, including $535.0 million outstanding under the
Authority's Bank Credit Facility which matures on March 9, 2012,
and the Authority's $250.0 million 2002 8% Senior Subordinated
Notes which mature on April 1, 2012. In addition, a substantial
amount of the Authority's other outstanding indebtedness matures
over the following three fiscal years.
The Company's balance sheet at March 31, 2012, showed $2.27
billion in total assets, $2.06 billion in total liabilities and
$211.30 million in total capital.
* * *
As reported by the TCR on March 14, 2012, Standard & Poor's
Ratings Services raised its corporate credit rating on Uncasville,
Conn.-based Mohegan Tribal Gaming Authority (MTGA) to 'B-' from
'SD'.
"The upgrade to 'B-' reflects our reassessment of the Authority's
capital structure following the completion of its comprehensive
debt refinancing plan," said Standard & Poor's credit analyst
Melissa Long. "While the completed transactions were not a de-
leveraging event, the post-exchange capital structure
substantially reduced MTGA's debt maturities over the next few
years," S&P said.
MORGANS HOTEL: Files Form 10-Q; Incurs $16.1-Mil. Net Loss in Q2
----------------------------------------------------------------
Morgans Hotel Group Co. filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss attributable for common stockholders of $16.11 million
on $47.79 million of total revenues for the three months ended
June 30, 2012, compared with a net loss attributable to common
stockholders of $13.65 million on $54.21 million of total revenues
for the same period during the prior year.
The Company reported a net loss attributable to common
stockholders of $33.04 million on $91.08 million of total hotel
revenues for the six months ended June 30, 2012, compared with a
net loss attributable to common stockholders of $47.88 million on
$108.61 million of total revenues for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $545.86
million in total assets, $655.93 million in total liabilities,
$6.12 million in redeemable noncontrolling interest and a $116.19
million total deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/4r3PG3
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
The Company reported a net loss of $87.95 million in 2011, a net
loss of $83.64 million in 2010, and a net loss of $101.60 million
in 2009.
MORGAN'S FOODS: J. Pappas May Own Up to 27% of Common Shares
------------------------------------------------------------
The Board of Directors of Morgan's Foods, Inc., amended and
restated its Shareholder Rights Agreement, the primary effect of
which is to amend the definition of who qualifies as an "Acquiring
Person" pursuant to the Agreement. The Rights Agreement now
allows James C. Pappas to beneficially own in the aggregate not
more than 27% of the Company's Common Shares issued and
outstanding without becoming an Acquiring Person.
Mr. Pappas is a director of the Company. The Board initially
approved the Shareholder Rights Agreement on April 8, 1999, and
amended it on April 14, 2003, and Oct. 2, 2007.
A copy of the Amended Shareholders' Right Agreement is avialable
for free at http://is.gd/SltsNz
About Morgan's Foods
Cleveland, Ohio-based Morgan's Foods, Inc., which was formed in
1925, operates through wholly-owned subsidiaries KFC restaurants
under franchises from KFC Corporation, Taco Bell restaurants under
franchises from Taco Bell Corporation, Pizza Hut Express
restaurants under licenses from Pizza Hut Corporation and an A&W
restaurant under a license from A&W Restaurants, Inc.
As of May 20, 2011, the Company operates 56 KFC restaurants,
5 Taco Bell restaurants, 10 KFC/Taco Bell "2n1's" under franchises
from KFC Corporation and franchises from Taco Bell Corporation,
3 Taco Bell/Pizza Hut Express "2n1's" under franchises from Taco
Bell Corporation and licenses from Pizza Hut Corporation,
1 KFC/Pizza Hut Express "2n1" under a franchise from KFC
Corporation and a license from Pizza Hut Corporation and 1 KFC/A&W
"2n1" operated under a franchise from KFC Corporation and a
license from A&W Restaurants, Inc.
The Company reported a net loss of $1.68 million for the year
ended Feb. 26, 2012, compared with a net loss of $988,000 for the
year ended Feb. 27, 2011.
The Company's balance sheet at May 20, 2012, showed $53.51 million
in total assets, $54.51 million in total liabilities and a $1
million total shareholders' deficit.
MOUNTAIN COUNTRY: Sec. 341 Meeting of Creditors on Aug. 13
----------------------------------------------------------
The U.S. Trustee in West Virginia will convene a meeting of
creditors under 11 U.S.C. Sec. 341(a) in the Chapter 11 case of
Mountain Country Partners, LLC, on Aug. 13, 2012, at 10:00 a.m.
The meeting will be held at the U.S. Trustees Meeting Room, Room
2009, Charleston.
Proofs of claim are due in the case by Nov. 13, 2012.
Dischargeability complaints are due on Oct. 12, 2012.
Seven individual investors filed an involuntary Chapter 11
bankruptcy petition against Jacksonville, Florida-based Mountain
Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on
Feb. 17, 2012. Judge Ronald G. Pearson presides over the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the
petitioners.
MOUNTAIN COUNTRY: Has Okay to Hire James W. Lane, Jr. as Attorney
-----------------------------------------------------------------
Mountain Country Partners, LLC, sought and obtained permission
from the U.S. Bankruptcy Court for the Southern District of West
Virginia to employ James W. Lane, Jr., as attorney.
Mr. Lane will, among other things, give the Debtor legal advice
with respect to its powers and duties as debtor-in-possession in
the continued operation of its business and management of its
property, at these hourly rates:
James W. Lane, Jr. $250
Paralegal $85
To the best of the Debtor's knowledge, Mr. Lane is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
About Mountain Country
Seven individual investors filed an involuntary Chapter 11
bankruptcy petition against Jacksonville, Florida-based Mountain
Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on
Feb. 17, 2012. Judge Ronald G. Pearson presides over the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the
petitioners.
MOUNTAIN COUNTRY: Files List of Largest Unsecured Creditors
-----------------------------------------------------------
Mountain Country Partners, LLC, filed with the U.S. Bankruptcy
Court for the Southern District of West Virginia a list of holders
of largest unsecured claims:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Robert P. Buck
1663 Carruthers
Memphis, TN 38112 Investment $200,000
Peter Horbulewicz
PO Box 605 disputed
Snellville, GA 30078 Investment $200,000
J.J. Bradshaw
26893 Bouquet Lyn Road, Ste C-248
Santa Cuarita, CA 91350 Investment $160,938
Peter and Colleen James
8912 E Pinnacle Peak Rd #414
Scottsdale, AZ 85255-3659 Investment $160,938
Kenneth Young Schwabb Investment $150,000
Alan Jackson Investment $100,000
April Baltzell Investment $100,000
Fred and Barbara Jane Jackson Investment $100,000
Josette Y. Jones Investment $100,000
Nan Murphy Investment $100,000
Richard Davis Investment $100,000
Travis Tollestrup Investment $100,000
Pamela DeHaven Investment $60,938
James and Crystal Johnson Investment $60,000
Bob & Tina Piercy Investment $50,000
Richard and Barbara Zimmer Investment $50,000
Robert Knowles Investment $50,000
West Virginia State Department Franchise Taxes $49,431
George Chope Investment $40,000
Sheriff, Roane County Real Estate Taxes $29,049
About Mountain Country
Seven individual investors filed an involuntary Chapter 11
bankruptcy petition against Jacksonville, Florida-based Mountain
Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on
Feb. 17, 2012. Judge Ronald G. Pearson presides over the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the
petitioners.
MOUNTAIN COUNTRY: Robert Johns Okayed as Chapter 11 Trustee
-----------------------------------------------------------
The U.S. Trustee sought and obtained authorization from the Hon.
Ronald G. Pearson of the U.S. Bankruptcy Court for the Southern
District of West Virginia to appoint Robert L. Johns as Chapter 11
trustee of Mountain Country Partners, LLC.
The petitioners, Kenneth Young, et al., asserted that the current
management does not have the confidence of the note holders or the
equity holders and grounds exist for the appointment of a Chapter
11 trustee. A Chapter 11 trustee can investigate the acts,
conduct, assets, liabilities and financial condition of the
Debtor. A Chapter 11 trustee may be able to prevent loss or
diminution of the bankruptcy estate and can bring proper local
management over the estate assets.
The Petitioners are represented by:
Joseph W. Caldwell, Esq.
Caldwell & Riffee
P.O. Box 4427
Charleston, WV 25364
Tel: (304) 925-2100
About Mountain Country
Seven individual investors filed an involuntary Chapter 11
bankruptcy petition against Jacksonville, Florida-based Mountain
Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on
Feb. 17, 2012. Judge Ronald G. Pearson presides over the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the
petitioners.
MSR RESORT: Big Question Mark Remains in Long-Awaited Plan
----------------------------------------------------------
Lisa Uhlman at Bankruptcy Law360 reports that MSR Resort Golf
Course LLC filed its Chapter 11 plan Wednesday, the filing
deadline under its exclusivity period, though a looming question
still remained as to what it would have to pay Hilton Worldwide
Inc. to cancel three property management agreements.
A glaring "TBD" stands out alongside the heading "Hilton rejection
damages claims" in a table in the plan's disclosure statement that
sets forth the classification, treatment, impairment status and
potential distributions associated with the different claims in
the case, Bankruptcy Law360 relates.
About MSR Resort
MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc.,
owns a portfolio of eight luxury hotels with over 5,500 guest
rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the
Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort
Hotel & Spa in Maui.
On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the
portfolio through a foreclosure proceeding. CNL-AB LLC is a joint
venture consisting of affiliates of Paulson & Co. Inc., a joint
venture affiliated with Winthrop Realty Trust, and affiliates of
Capital Trust, Inc.
Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts
before the Jan. 28 foreclosure.
Following the acquisition, five of the resorts with mortgage debt
scheduled to mature on Feb. 1, 2011, were sent to Chapter 11
bankruptcy by the Paulson and Winthrop joint venture affiliates.
MSR Resort Golf Course LLC and its affiliates filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan
on Feb. 1, 2011. The resorts subject to the filings are Grand
Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta
Resort and Club and PGA West, Doral Golf Resort and Spa, and
Claremont Resort and Spa.
James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O.
Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis,
LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey
Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson
Consultants LLC is the Debtors' claims agent.
The five resorts had $2.2 billion in assets and $1.9 billion in
debt as of Nov. 30, 2010, according to court filings. In its
schedules, debtor MSR Resort disclosed $59,399,666 in total assets
and $1,013,213,968 in total liabilities.
The resorts have agreement with lenders allowing the companies to
remain in Chapter 11 at least until September 2012.
The Official Committee of Unsecured Creditors is represented by
Martin G. Bunin, Esq., and Craig E. Freeman, Esq., at Alston &
Bird LLP, in New York.
NAKNEK ELECTRIC: Hearing Friday on Plan Disclosures
---------------------------------------------------
The U.S. Bankruptcy Court for the District of Alaska will convene
a hearing on Aug. 10, 2012, at 10 a.m., to consider adequacy of
the First Amended Disclosure Statement explaining Naknek Electric
Association, Inc.'s Plan of Reorganization dated June 28, 2012.
Objections, if any, were due Aug. 7.
According to the Disclosure Statement, the Debtor will terminate
its geothermal project, close, plug and abandon the geothermal
well. If it can raise the preliminary estimate of $804,000 to
plug and abandon its well before the drill rig is shipped out of
Naknek, it will utilize the drill rig. Otherwise, it will lease a
wire line vehicle, or other similar equipment to satisfy
regulatory requirements that the well be plugged and abandoned.
The geothermal assets will be sold or otherwise disposed to each
lien claimant holding a lien in the geothermal assets. The
proceeds of the sales or dispositions will be paid to Allowed
Secured Claims having liens against the geothermal assets.
Allowed Secured Claims in the geothermal real property will be the
beneficiaries of a mortgage recorded by the Debtor after the
Effective Date, which mortgage will expire six years after the
Effective Date.
Allowed Secured Claims who are beneficiaries of the mortgage may
reconvey their interests before the first payments to Class 11,
Unsecured Class and participate in the payment to that Class 11.
Class 11 will be paid $3 million over six years beginning in
August 2014. Class 11 will receive the net proceeds recovered in
avoidance actions. No return of patronage capital to members will
occur until after final payments under the Plan have been made.
Class 11 will received a subordinated mortgage recorded against
the geothermal property which expires six years after
confirmation.
A copy of the Disclosure Statement is available for free at
http://bankrupt.com/misc/NAKNEK_ds_1amended.pdf
About Naknek Electric Association
Naknek, Alaska-based Naknek Electric Association, Inc., operates a
diesel power generation plant, storage and distribution system
on approximately 9.34 acres of land it owns in Naknek, Alaska.
It provides electricity to 591 members of the cooperative. It
also is developing a geothermal well.
Naknek Electric filed for Chapter 11 bankruptcy protection (Bankr.
D. Alaska Case No. 10-00824) on Sept. 29, 2010. Erik LeRoy, Esq.,
at Erik Leroy P.C., assists the Debtor in its restructuring
effort. The Debtor disclosed $21,459,632 in assets and $7,523,708
as of the Chapter 11 filing.
The Debtor filed with the Bankruptcy Court a plan of
reorganization and an accompanying disclosure statement on
Sept. 15, 2011. The Plan proposed that the Debtor will pay Class
13, unsecured creditors, $3 million over 60 months commencing on
the Effective Date. Based on the current claims filed in the
case, the proposed payment will pay unsecured creditors a dividend
of about $0.10 on each dollar of claim.
A committee of unsecured creditors has been appointed by the
United States Trustee.
NATIONAL BEDDING: Mood's Says Advent Acquisition Credit Positive
----------------------------------------------------------------
On August 5, 2012, private equity firm Advent International said
it agreed to acquire a majority interest in AOT Bedding Super
Holdings, the parent company of National Bedding Co. (B2, stable),
the majority owner and licensee of Serta, and Simmons Bedding
Co.(B2, Stable). "We think the acquisition by Advent is credit
positive in the near term as it removes uncertainty surrounding
who might acquire the two bedding companies, which have been
rumored to be for sale for a couple of months," said Kevin
Cassidy, Senior Credit Officer, at Moody's Investors Service. "The
longer term credit implications, however, are not yet clear as we
don't know what Advent's plans are for Serta and Simmons' long
term capital structure or what its operating strategy will be," he
said
Ratings Rationale
Simmons' B2 Corporate Family Rating reflects Moody's expectation
that Simmons will continue to generate moderate free cash flow and
maintain an adequate liquidity profile. The rating also reflects
Simmons' mixed credit metrics, with adjusted leverage under 5
times, but mid single digit EBITA margins and low single digit
free cash flow/adjusted debt percentages. The rating is
constrained by the potential merger with Serta as they have the
same owners as well as by the volatility in profitability and cash
flows. The rating is also inhibited by Simmons' modest scale with
revenue around $1 billion and by the continued uncertainty in
discretionary consumer spending, especially for middle and low
income consumers. Simmons' good market position and brand names
and the mattress industry's historically strong fundamentals
support the rating.
Serta's B2 Corporate Family Rating reflects its position as one of
the top mattress companies in the mid-price segment and the
success of its iComfort brand. The rating also reflects Moody's
expectation that Serta will continue to generate good free cash
flow and maintain an adequate liquidity profile. The rating also
reflects Serta's good credit metrics, with adjusted leverage under
5x, but double digit EBITA margins and interest coverage of 3x.
The rating is constrained by the potential merger with Simmons as
they have the same owners, $365 million debt maturity in November
2013, volatility in profitability and cash flows experienced
during the Great Recession. The rating is also restrained by the
modest scale with revenue around $1.1 billion and by the
continuing uncertainty in discretionary consumer spending,
especially for middle and low income consumers.
The principal methodologies used in this rating were Global
Consumer Durables 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.
National Bedding Company is based in Hoffman Estates, Illinois, is
a major manufacturer of mattresses under the Serta brand name. Net
sales for the twelve months ended March 31, 2012, approximated
$1.1 billion.
Simmons Bedding Company is headquartered in Atlanta, Georgia.
Simmons manufactures and markets a broad range of products under
well-recognized brand names, including Beautyrest(R), Beautyrest
Black(R), ComforPedic by Simmons(R), Natural Care TM Latex(R),
Beautyrest Beginnings(R)and BeautySleep(R). Net sales for the year
ended December 31, 2011 were approximately $1 billion.
NAVISTAR INT'L: Fitch Junks Rating on Senior Unsecured Debt
-----------------------------------------------------------
Fitch Ratings has downgraded the Issuer Default Ratings (IDR) for
Navistar International Corporation (NAV) and Navistar Financial
Corporation (NFC) to 'B-' from 'B+'. NAV's senior unsecured debt
is downgraded to 'CCC' from 'BB-', and NFC's senior secured bank
credit facilities are downgraded to 'CCC' from 'BB-'. Fitch has
assigned an expected rating of 'BB-' to Navistar, Inc.'s planned
senior secured term loan facility of up to $1 billion announced
Aug. 2, 2012. NAV will guarantee the facility. NAV's senior
subordinated convertible debt is downgraded to 'CC' from 'B-'.
The rating Outlook is Negative.
The rating downgrades for NAV and NFC consider the negative impact
of recent developments including already weak operating results in
2012 that are likely to be worse than previously expected by
Fitch. Results will continue to be pressured by costs to
incorporate Cummins emissions technology and engines in NAV
products and slower growth in demand for trucks in North America
and other regions related to economic concerns. In addition,
NAV's market share in the near term is subject to its reliance on
non-conformance penalties (NCP) and emissions credits to sell
trucks during the transition to NAV's revised engine strategy,
even while discussions continue with the Environmental Protection
Agency (EPA) and California Air Resources Board (CARB). NFC's
performance has not changed materially compared to Fitch's
expectations, but its financial profile is likely to be affected
over the long term by lower than expected volumes at NAV and NFC's
strong linkage to its manufacturing parent.
NAV is in the process of obtaining a senior secured term loan of
up to $1 billion. The facility would strengthen the company's
liquidity and mitigate concerns in the near term about weak free
cash flow and costs to implement NAV's revised engine strategy. A
portion of the term loan proceeds will be used to repay
outstanding balances under NAV's asset-based credit facility
('ABCL'), with the remainder available to fund working capital and
general corporate purposes.
The Negative rating Outlook reflects execution risks associated
with the transition in NAV's engine strategy that has contributed
to NAV's reduced market share; a large net pension obligation;
engine quality issues that contributed to high warranty charges in
the first half of fiscal 2012; and high leverage. Manufacturing
debt/EBITDA increased materially in the first half of 2012, to
slightly above 4 times (x) at April 30, 2012, and can be expected
to increase materially as a result of NAV's new term loan and near
term earnings pressure. In addition, NAV disclosed that it
received a subpoena from the SEC with respect to a formal order of
investigation for the period November 1, 2010 to the present
concerning accounting and disclosure issues.
NAV's revised engine strategy involves some uncertainty about its
ability to deliver trucks until it has redesigned its trucks and
engines. Emissions credits are expected to be depleted in 2012
for heavy duty engines and in 2013 for medium duty engines. NAV
is discussing its engine plans with the EPA and the California Air
Resources Board (CARB), but the outcome has yet to be determined
and may be subject to legal review. In June 2012, the U.S. Court
of Appeals invalidated the EPA's Interim Final Rule allowing NAV
to use NCP's, although the ruling has not yet been put into
effect.
NAV's ratings could be reviewed for a possible downgrade if
warranty costs don't stabilize and eventually improve, free cash
flow doesn't recover when NAV completes the transition of its
engine strategy, or the company's engineering integration strategy
and expansion overseas fail to produce improved margins. If sales
volumes and margins are pressured, FCF could be impaired, making
it difficult to fund capital expenditures, pension contributions
and higher interest expense. Liquidity provided by the proposed
term loan provides time to execute NAV's engine strategy, but it
could potentially be reduced the concerns just mentioned about
volumes, margins and FCF. In addition, three investors have
accumulated approximately 48% of NAV's common shares in recent
months which introduces some uncertainty about long term operating
and financial policies.
The rating Outlook could eventually be changed to Stable if NAV is
able to maintain production levels through the use of emissions
credits and NCP's. The ratings and outlook could also be
supported if engine quality improves materially, operating margins
improve, leverage declines, and the company's market share
recovers.
NAV's proposed term loan reduces recovery prospects for NAV's
unsecured debt. The recovery rating of '1' for the term loan
supports a rating of 'BB-', three levels above NAV's IDR, as the
loan can be expected to recover more than 90% in a distressed
scenario based on a strong collateral position. The '5' recovery
rating for NAV's senior unsecured debt results in a rating of
'CCC', one notch below the IDR, and reflects poor recovery
prospects in a distressed scenario. A recovery rating of '6' for
the senior subordinated convertible notes reflects a lower
priority relative to NAV's senior unsecured debt. Consistent with
the unsecured facility ratings of NAV, NFC's secured bank facility
is rated one notch below its IDR of 'B-' due to a collateral
position that ranks behind a material amount of higher-priority
encumbered debt of the finance company.
A material loss in the first half of 2012 reflected large warranty
charges, higher commodity costs for steel and rubber, the negative
impact of lower sales of military trucks and parts, weak demand in
Brazil associated with engine pre-buying in 2011, and a transition
to contract engine manufacturing for a large customer in Brazil.
NAV also incurred start-up and restructuring costs in certain
businesses and relocated its headquarters as part of the
engineering integration. The company doesn't expect to return to
profitability until the fourth quarter.
Fitch expects costs related to the change in NAV's engine strategy
could result in negative manufacturing free cash flow (FCF) in the
second half of fiscal 2012 and potentially into fiscal 2013 until
the engine transition is complete. Manufacturing FCF in the first
half of 2012 was negative $388 million, reflecting low margins and
capital expenditures which remain higher than average as NAV
integrates its engineering functions, invests in a research center
and engine testing facility, and realigns other parts of its
business.
NAV's manufacturing FCF is also constrained by recurring pension
contributions. NAV's net pension obligations totaled $1.8 billion
(approximately 57% funded) at the end of 2011. As of April 30,
2012, NAV expected to contribute $190 million to the plans in
2012, of which $82 million was contributed during the first half
of the year. Between 2013 and 2015, NAV estimated it would be
required to contribute at least $210 million annually. However,
the company has indicated that required contributions could be
less than these estimates based on recent pension legislation.
At July 31, 2012, Navistar estimated manufacturing cash and
marketable securities at $575 million - $625 million, compared to
nearly $1.2 billion at Oct. 31, 2011. Liquidity also included a
$355 million 'ABCL' that matures in 2016. Liquidity will increase
upon completion of NAV's new senior secured term loan. As of
April 30, 2012, there was $230 million of manufacturing debt due
within one year, including $100 million due under the ABCL. NAV
borrowed an additional $138 million under the facility in June
2012. Beyond one year, NAV's $570 million of senior subordinated
convertible note are scheduled to mature in October 2014.
Fitch views NFC as neutral to the rating. NFC's financial
performance is generally in line with Fitch's expectations.
Profitability declined slightly in the six-months ended April 30,
2012 due to the run-off of NFC's retail portfolio, and future
profitability at NFC will be directly affected by the general
operating performance and financial condition of NAV.
Furthermore, the retail balance is expected to decline over the
next several years due to NFC's agreement with GE Capital in 2010
as the primary funding source for the company's retail portfolio.
Asset quality continues to improve and provisioning volatility has
declined as NFC focuses on its relatively lower risk wholesale
portfolio. Absent material dividends upstreamed to the parent,
Fitch expects NFC's leverage to improve and stay below historical
levels due to reduced financing needs as a result of NFC's
agreement with GE Capital. In the fourth quarter of calendar
2011, NFC completed a significant refinancing of its credit
facilities. Fitch believes the refinancing of its credit
facilities may mitigate any potential near-term liquidity
concerns.
The ratings of the finance subsidiary are directly linked to those
of its ultimate parent due to the close operating relationship and
its strategic importance to NAV. This linkage outweighs the
stand-alone credit profile and operating performance of NFC, as
substantially all of NFC's business is connected to the financing
of new and used trucks sold by NAV and its dealers. The
relationship between NAV and NFC is formally governed by the
Master Intercompany Agreement. Also, there is a requirement
referenced in NFC's credit agreement requiring Navistar, Inc. or
NAV to own 100% of NFC's equity at all times.
Fitch's ratings cover approximately $2 billion of debt at NAV and
$2.5 billion of outstanding debt at its Financial Services
segment, the majority of which is at NFC, as of April 30, 2012.
Fitch has taken the following rating actions:
Navistar International Corporation
-- Long-term IDR downgraded to 'B-' from 'B+';
-- Senior unsecured notes downgraded to 'CCC'/'RR5' from 'BB-'/
'RR3';
-- Senior subordinated notes downgraded to 'CC'/'RR6' from
'B-'/'RR6'.
Navistar, Inc.
-- Long-term IDR rated 'B-';
-- Senior secured bank term loan facility assigned an expected
rating of 'BB-'/'RR1';
Cook County, Illinois
-- Recovery zone revenue facility bonds (Navistar International
Corporation Project) series 2010 downgraded to 'CCC' from
'BB-'.
Illinois Finance Authority (IFA)
-- Recovery zone revenue facility bonds (Navistar International
Corporation Project) series 2010 downgraded to 'CCC' from
'BB-'.
Navistar Financial Corporation
-- Long-term IDR downgraded to 'B-' from 'B+';
-- Senior secured bank credit facilities downgraded to
'CCC'/'RR5' from 'BB-'/ 'RR3'.
NIELSEN HOLDINGS: Moody's Changes Outlook on 'Ba3' CFR to Pos.
--------------------------------------------------------------
Moody's Investors Service changed the outlook to positive (from
stable) for the Ba3 Corporate Family Rating (CFR) and all debt
instrument ratings of Nielsen Holdings NV (Nielsen) and its
subsidiaries. The change in outlook reflects Moody's expectation
that Nielsen will remain on a deleveraging trajectory, driven by a
mix of continued solid operating performance and application of
discretionary cash flows towards debt reduction so that Moody's
ratio of adjusted Debt/Ebitda moves towards 4x in 2013.
Ratings Rationale
Nielsen delivered constant currency revenue growth of 3.5% in the
second quarter of 2012, broadly in line with its medium term
guidance of mid-single digit growth despite a more challenging
operating environment. The macroeconomic situation in Europe
pressured revenue growth in the region, particularly for the more
cycle-sensitive regional 'Insights' business (approximately -20%)
within the 'Buy' division. In addition, revenue growth in
developing markets slowed down in the second quarter to 7%
(constant currency; from 17% in the prior year period) as some
larger internationally operating customers in the 'Buy' segment
invested more selectively. Lastly, the monetization of Nielsen's
newer online and cross platform measurement services in the
'Watch' business remains a more medium term prospect in a very
competitive and evolving market place. However, despite headwinds
from a more challenging macro-economic environment, which Moody's
expects to persist for the remainder of 2012 and into 2013,
Nielsen's resilient business model should allow for continued
solid revenue growth. In the second half of 2012, the 'Buy'
business, Nielsen's largest segment, will further benefit from the
coverage expansion in the United States from the integration of
Walmart data, an important contract that was won in July 2011.
This will contribute incrementally to revenue growth and a degree
of related margin expansion from the third quarter onwards, so
that the company's revenue guidance for 2012 (5-6% constant
currency growth) appears achievable.
The positive outlook further reflects Moody's expectation that
Nielsen will continue to apply growing discretionary cash flows
towards debt (p)repayment in line with its stated objective to
reduce the Net debt/Ebitda ratio (as measured by Nielsen) by 0.5x
per year. This should still allow for small add-on acquisitions to
complement the company's geographic footprint and/or its product
portfolio. While term debt reductions in the first half of 2012
were offset by temporary revolver drawings, Moody's assumes that
the company will use part of its second half cash flow generation
to prepay debt where possible. Nielsen has also indicated that it
will consider refinancing high-coupon debt of around US$ 800
million that becomes callable in the second quarter of 2013. In
addition, the conversion of Nielsen's US$ 288 million mandatory
convertible (included in Moody's gross debt number), expected on
February 1 2013, will lead to an incremental improvement in
Nielsen's leverage metrics.
Moody's regards Nielsen's liquidity as comfortable for its near-
term needs. As of June 2012, the company had US$ 283 million in
cash and cash equivalents and its US$ 635 million senior secured
revolving credit facility (due 2016) was largely available (US$
215 million drawn as of June 2012). Together with operational cash
generation this comfortably covers short-term debt of US$ 324
million (including drawings under the revolving credit facility)
as of June 30 2012. Maturities remain moderate until 2016 when US$
3 billion in bank and term debt fall due. Moody's expects that
Nielsen will address the 2016 maturities in a proactive manner.
The principal methodology used in rating Nielsen Holdings NV,
Nielsen Finance LLC and Nielsen Company B.V. was the Global
Business & Consumer Service Industry Rating 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.
Active in approximately 100 countries, with headquarters in
Diemen, The Netherlands and New York, USA, Nielsen Holdings N.V.
(Nielsen) is - through its operating subsidiaries - a global
information and measurement company with market leadership
positions and strong brands. Revenues for the six months to June
2012 reached US$ 2.7 billion and are reported under three
segments: 'Buy', 'Watch' and 'Expositions'.
NORTEL NETWORKS: Files Benefits Termination Motions
---------------------------------------------------
Peg Brickley at Dow Jones' Daily Bankruptcy Review reports that
Nortel Networks Corp. is seeking to cut off health-care benefits
for 4,500 retired U.S. employees and dependents by the end of the
year, a move the company says is necessary as it moves toward the
end of its corporate life.
BankruptcyData.com reports that Nortel Networks filed a motion for
an order authorizing the termination of retiree benefits effective
December 31, 2012 and approving a settlement under which the
retirees have six months effective December 31, 2012 to submit
claims for reimbursement. The Debtors also filed a motion seeking
to terminate long-term disability plans and the employment of the
LTD employees, also effective December 31, 2012.
Nortel asserts, "Indeed, despite the filing of this motion, the
Debtors remain open to reaching a settlement with the Retiree
committee on reasonable terms. However at this advanced state in
their restructuring process, where the Debtors have been unable to
reach an agreement with the LTD committee after a year and the end
of a plan year is quickly approaching, the Debtors simply cannot
allow time to continue to slip by hoping for a settlement, all the
while continuing to spend substantial amounts of money providing
benefits to the LTD employees."
The Court has yet to schedule a hearing on the motions.
About Nortel Networks
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.
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. The Committee retained Alvarez & Marsal Healthcare
Industry Group as financial advisor, and Kurtzman Carson
Consultants LLC as its communications 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 has collected almost $9 billion for distribution to
creditors. Of the total, US$4.5 billion came from the sale of
Nortel's 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.
NORTH END UNITED HOUSING: Gets Reprieve From Receivership
---------------------------------------------------------
Herald Business reports that the North End United Housing Co-
operative in Halifax, Nova Scotia, has been given a reprieve from
receivership.
"I am not prepared to proceed this morning with hearing the motion
brought on behalf of the Nova Scotia Housing Development Corp. for
the appointment of a receiver. . . . I am going to challenge
everyone here, over the course of the next two weeks, to once
again go back to the table," the report quoted Nova Scotia Supreme
Court Justice J. Glen McDougall.
Herald Business notes that the housing co-op applied for creditor
protection in January in an attempt to save 131 townhouses and
apartments in several north-end Halifax communities.
It received $3.1 million in forgivable loans in January 2010 under
the province?s Social Housing Assistance Repair Program for
renovation work on its properties, Herald Business says.
The report notes that the cost overruns, detailed in a report by
court-appointed monitor Grant Thornton, resulted in debts of
$1,039,777 owed to more than a dozen subcontractors, leaving the
co-op with a total liability of $1,195,795, including interest.
The motion to appoint a receiver was made after unsecured
creditors rejected an amended restructuring plan earlier this
month that would have seen them receive $440,000 an increase from
an original offer of $200,000, Herald Business says.
But McDougall said the potential loss of affordable housing was
too great to give up yet, the report relates.
Herald Business notes that the judge said the creditors should
seriously consider anything in the range of a 50 to 60 per cent
return.
The province, through the housing development corporation, is the
co-op?s sole secured creditor, holding $9.7 million in mortgages
on co-op properties, according to Justice Department spokesman Dan
Harrison, Herald Business discloses.
The province accepted the amended reconstruction plan, which would
have increased average monthly co-op rents to $967 by Aug. 1,
2016, bringing member housing charges to the high end of the
market, according to the monitor, Herald Business says.
NPS PHARMACEUTICALS: Reports $7.3 Million Net Income in Q2
----------------------------------------------------------
NPS Pharmaceuticals, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income of $7.35 million on $53.51 million of total revenues
for the three months ended June 30, 2012, compared with a net loss
of $6.13 million on $27.21 million of total revenues for the same
period during the prior year.
The Company reported a net loss of $3.20 million on $76.44 million
of total revenues for the six months ended June 30, 2012, compared
with a net loss of $15.28 million on $50.78 million of total
revenues for the same period during the prior year.
The Company's balance sheet at June 30, 2012, showed $186.92
million in total assets, $232.18 million in total liabilities and
a $45.25 million total stockholders' deficit.
"This is a transformational time for NPS as we work toward U.S.
regulatory approval of our first product, Gattex (teduglutide) in
short bowel syndrome and submission of our Biologic License
Application for Natpara in hypoparathyroidism," said Francois
Nader, MD, president and chief executive officer, NPS
Pharmaceuticals. "We were delighted that our partner Nycomed
secured a positive CHMP opinion recommending marketing approval
for Revestive (teduglutide) in Europe. This is an important step
in our goal of bringing this much-needed therapy to patients with
short bowel syndrome."
"On the financial front, the cash flow from the deal we recently
announced with Amgen is expected to fully support the launches of
both Gattex and Natpara and marks a noteworthy step in advancing
our goal of becoming a self-sustaining commercial-stage
organization," said Luke Beshar, executive vice president and
chief financial officer, NPS Pharmaceuticals. "This transaction
has already generated $25 million of new capital. We also expect
it to provide at least $50 to $60 million per year of cash now
through repayment of the Sensipar royalty advance in 2015.
Following repayment of the royalty advance, we will receive our
full Sensipar royalty through 2018. This agreement underscores
our commitment to access significant capital in a manner that is
in the best interests of our shareholders."
A copy of the Form 10-Q is available for free at:
http://is.gd/p0QqvC
About NPS Pharmaceuticals
Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq:
NPSP) -- http://www.npsp.com/-- is developing new treatment
options for patients with rare gastrointestinal and endocrine
disorders.
NPS reported a net loss of $36.26 million in 2011, a net loss of
$31.44 million in 2010 and a net loss of $17.86 million in 2009.
NUANCE COMMS: Moody's Rates Proposed Sr. Unsecured Notes 'Ba3'
--------------------------------------------------------------
Moody's Investors Service rated Nuance Communications Inc.'s
proposed senior unsecured notes Ba3, raised the company's senior
secured debt's ratings to Baa2 from Baa3 and affirmed the Ba2
corporate family rating. The proposed notes will be used for
general corporate purposes including acquisitions. The increase in
the senior secured rating is driven by the additional unsecured
debt below it in the capital structure. Though debt to EBITDA will
increase as a result of the new debt offering to approximately 5x
(with Moody's standard adjustments and pro forma for recent
acquisitions), Moody's expects the company will reduce leverage to
below 3.5x over the next year. The ratings outlook is stable.
Ratings Rationale
Nuance's Ba2 corporate family rating reflects its leading position
within the voice recognition industry, the favorable growth
profile of the company and industry and the strong cash flow
generating capabilities of company. The ratings remain tempered by
the company's acquisition appetite as it attempts to further
build-out its portfolio of speech recognition applications and
services. The ratings contemplate that the company will continue
to use a mix of cash, debt and stock to finance acquisitions. As a
result of debt funded acquisitions, Moody's expects the company
will occasionally increase pro forma leverage above 3.5x on a
temporary basis, but quickly bring leverage down.
Nuance is on track to pass $1.6 billion in revenue in the fiscal
year 2012. The company has grown revenues from $232 million in
fiscal 2005 through a combination of organic growth and
acquisitions. Though rapid growth through acquisitions resulted in
muted GAAP profitability over this period due to purchase
accounting adjustments and transaction related expenses and
restructuring costs (GAAP EBIT margins typically in the mid single
digits), the company has been able to generate impressive free
cash flow margins (as defined by free cash flow to revenue) often
exceeding 20%.
Though the acquisition appetite will likely restrain the ratings
over the near to medium term, as the company gets larger and
subsequent acquisitions have a smaller impact on the whole, the
ratings could be raised to the extent Nuance maintains market
leadership positions, successfully integrates the ongoing
acquisitions and continues to produce strong free cash flow.
Ratings could be lowered if pro forma leverage exceeds 4x on a
sustained basis or if Nuance or is unable to continue to
demonstrate effectiveness in integrating acquisitions.
The ratings on the debt instruments were determined using Moody's
Loss Given Default Methodology and based on the instruments'
relative positions in the capital structure. The ratings on the
existing senior secured facilities were revised upwards to Baa2
from Baa3 which reflects the reduced proportion of secured debt in
the capital structure as a result of the new unsecured notes.
Upgrades:
Issuer: Nuance Communications, Inc.
Senior Secured Bank Credit Facility, Upgraded to Baa2
(LGD2, 11%) from Baa3 (LGD2, 18 %)
Assignments:
Issuer: Nuance Communications, Inc.
Senior Unsecured Regular Bond/Debenture, Assigned Ba3
(LGD4, 67%)
The principal methodology used in rating Nuance was the Global
Software Industry Methodology published in May 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.
Nuance Communications, Inc., headquartered in Burlington, MA, is a
leading provider of speech, text and imaging solutions for
business and consumers. The company had revenues of $1.4 billion
for the twelve months ended March 31, 2012.
OCEAN BREEZE: Case Summary & 5 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Ocean Breeze Park Homeowners' Association, Inc.
3000 NE Indian River Drive
Jensen Beach, FL 34957
Bankruptcy Case No.: 12-28820
Chapter 11 Petition Date: August 3, 2012
Court: U.S. Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Erik P. Kimball
About the Debtor: According to a court filing, the Debtor is a
residential cooperative mobile home park located
at 3000 N.E. Indian River Drive, Jensen Beach,
Florida. The shareholders have equity ownership
in the Cooperative, allowing them to hold
proprietary leases which provide for 99-year
leasehold agreements. There are 549 mobile home
units, 39 cottages and 16 recreational vehicle
units. There are 137 units subject to the
proprietary leases.
Debtor's Counsel: Alvin S. Goldstein, Esq.
FURR AND COHEN, P.A.
2255 Glades Road, #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
E-mail: mmitchell@furrcohen.com
- and ?
Robert C. Furr, Esq.
FURR AND COHEN, P.A.
2255 Glades Road, #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
E-mail: bnasralla@furrcohen.com
Scheduled Assets: $13,472,535
Scheduled Liabilities: $24,870,355
The petition was signed by Harry Bartlett, president.
Debtor's List of Its Five Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Martin County Tax Collector Real Property Taxes $250,000
3485 SE Willoughby Boulevard
Stuart, FL 34994
Fox Wackeen Dungey, et al. Attorney Fees and $39,128
3473 SE Willoughby Boulevard Costs
Stuart, FL 34994
Lutz, Bobo, Telfair, et al. Attorney Fees and $24,400
Two North Tamiami Trail, #500 Costs
Sarasota, FL 34236-5575
Kelly Services, Inc. Office Help $3,284
Abel Band, Chartered Attorney Fees and Unknown
Costs
OJSC HC: Files Suit Against Former Execs for Sibirsky Debt
----------------------------------------------------------
OJSC "HC "Sibcem" notifies its shareholders of legal proceedings,
initiated by the Company against former executives of the company,
who didn't repay the loan to "Sibirskiy Cement" and its
subsidiaries. The amount, which the holding company and its
subsidiaries want to recover, is equal to almost RUB140 million.
Andrei Muraviev, Andrei Kirikov and Sergei Khrapunov participate
in these proceedings personally or through their subsidiaries.
On March 27, 2011, the Arbitrazh court of Kemerovo oblast
recovered from LLC "Sibirskaya promyshlennaya investicionnaya
companiya" in favor of LLC "Topkinskiy Cement" more than RUB38,5
million (LLC "SPIC" was established by Andrei Muraviev, the head
of the holding company "Sibirskiy Cement" from 2004 to August
2008, and Andrei Kirikov, a former member of the Board of
Directors of OJSC "HC "Sibcem" (a parent company and managing
company of LLC "Topkinskiy Cement")).
However, the holding company faced several difficulties returning
the debt. Thus, LLC "SPIC" changed its legal address, and
registered in Krasnodar Krai. Then Novokubansky District
Bailiffs' Department of the Russian Federal Bailiff Service of
Krasnodar Krai, in the person of a bailiff A. Bochkarev, twice
refused to institute enforcement proceeding by the Arbitrazh Court
decision. (According to the statement of LLC "Topkinskiy Cement"
the Arbitrazh Court of Krasnodar Krai declared the actions of the
bailiff A. Bochkarev illegal, and his order to refuse to institute
enforcement proceeding - invalid).
At the same time LLC "SPIC" appealed to the Arbitrazh Court of
Krasnodar Krai with a bankruptcy petition. At this time a
monitoring procedure is commenced in relation to LLC "SPIC". LLC
"Topkinskiy Cement" is in the creditor's register of the debtor.
On Aug. 8, 2010 Central District Court of Kemerovo satisfied the
claim of LLC "Topkinskiy Cement" against Sergei Khrapunov, former
Vice-President for Economics and Finance in OJSC "HC "Sibcem", for
the recovery of RUB31,9 mln debt, interest and penalty under loan
agreements. Nikulinsky District Court of Moscow additionally
recovered from him (for the period from May 18, 2010 to April 4,
2011) interest in the amount of more than RUB2,8 mln. The claim
for recovery of interest for the period from March 14, 2011 to the
present day is being prepared.
After the Court Decision the debtor took a series of actions,
which were, under the opinion of OJSC "HC "Sibcem", aimed at
avoidance of enforcement of action. However, LLC "Topkinskiy
Cement" (a subsidiary of OJSC "HC "Sibcem") intends to take all
legally provided opportunities to recover money from the debtor.
On July 19, 2012 Presninsky District Court of Moscow considered a
case on the claim of OJSC "HC "Sibcem" against Andrei Kirikov, a
former member of the Board of Directors of OJSC "HC "Sibcem".
The holding company claimed the recovery of the loan in the amount
equal to $2 million and loan interest (in total more than RUB70
million), which the respondent obtained from the company in June
2007 without setting the term of the loan. The representative of
the Respondent confirmed the receipt of money, but insisted that
the funds were transferred to Mr. Kirikov as "expenses of
representation" and they were not supposed to be refunded to the
Claimant.
He also presented a claim for return of money, signed by the Vice-
President for Economics and Finance S. Khrapunov, dated Feb, 22,
2008, wherefore declared the omission of the limitation period.
In the result the court didn't satisfy the claim of the holding
company due to the omission of the limitation period. OJSC "HC
"Sibcem" now intends to appeal this decision on appeal and because
of their doubts about the existence of the abovementioned demand
at the time before OJSC "HC "Sibcem" referred to the court, will
seek an examination.
OJSC "HC "Sibcem" pursues and will pursue a coherent policy on
detection and restriction of all unfair acts, asserting rights and
legitimate interests of the Company and its shareholders in all
authorities in and outside Russia.
ORAGENICS INC: To Raise $12.8MM in Private Placement Financing
--------------------------------------------------------------
Oragenics, Inc., has entered into a definitive stock purchase
agreement with accredited investors to raise $12,863,332 in a
private placement financing. Pursuant to the stock purchase
agreement, the Company will issue an aggregate of 8,575,555 shares
of the Company's common stock at a price per share of $1.50. In
conjunction with the private placement financing, the Company's
outstanding secured notes payable of $2.5 million will
automatically convert into shares of common stock at the same
price per share as paid by the investors in the Private Placement
financing which eliminates all the long-term debt of the Company.
The net proceeds from this offering will be used to accelerate
development of several of the company's key initiatives including
its recently announced Exclusive Channel Collaboration Agreement
with Intrexon Corporation relating to the Company's lantibiotics
program, sales and marketing of the Company's probiotic product
lines and general corporate purposes.
Griffin Securities, Inc., served as the Company's exclusive
placement agent for the offering.
The securities offered in this private placement transaction have
not been registered under the Securities Act of 1933, as amended,
or applicable state securities laws. Accordingly, the securities
may not be offered or sold in the United States except pursuant to
an effective registration statement or an applicable exemption
from the registration requirements of the Securities Act and such
applicable state securities laws. Pursuant to the terms of a
registration rights agreement entered into with the investors, the
Company has agreed to file a registration statement with the
Securities and Exchange Commission registering the resale of the
shares of common stock sold in the offering. Any offering of the
Company's securities under the resale registration statement
referred to above will be made only by means of a prospectus.
About Oragenics Inc.
Tampa, Fla.-based Oragenics, Inc. -- http://www.oragenics.com/--
is a biopharmaceutical company focused primarily on oral health
products and novel antibiotics. Within oral health, Oragenics is
developing its pharmaceutical product candidate, SMaRT Replacement
Therapy, and also commercializing its oral probiotic product,
ProBiora3. Within antibiotics, Oragenics is developing a
pharmaceutical candidate, MU1140-S and intends to use its
patented, novel organic chemistry platform to create additional
antibiotics for therapeutic use.
In its audit report for the 2011 financial statements, Mayer
Hoffman McCann P.C., in Clearwater, Florida, expressed substantial
doubt about the Company's ability to continue as a going concern.
The independent auditors noted that the Company has incurred
recurring operating losses, negative operating cash flows and has
an accumulated deficit.
The Company reported a net loss of $7.67 million in 2011, compared
with a net loss of $7.80 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$1.94 million in total assets, $2.25 million in total liabilities,
and a $314,253 total shareholders' deficit.
Bankruptcy Warning
The Company said in its annual report for the year ended Dec. 31,
2011, that its loan agreement with the Koski Family Limited
Partnership matures in three years and select material assets of
the Company relating to or connected with its ProBiora3, SMaRT
Replacement Therapy, MU1140 and LPT3-04 technologies have been
pledged as collateral to secure the Company's borrowings under the
Loan Agreement. This secured indebtedness could impede the
Company from raising the additional equity or debt capital the
Company needs to continue its operations even though the amount
borrowed under the Loan Agreement automatically converts into
equity upon a qualified equity financing of at least $5 million.
The Company's ability to repay the loan will depend largely upon
the Company's future operating performance and the Company cannot
assure that its business will generate sufficient cash flow or
that the Company will be able to raise the additional capital
necessary to repay the loan. If the Company is unable to generate
sufficient cash flow or are otherwise unable to raise the funds
necessary to repay the loan when it becomes due, the KFLP could
institute foreclosure proceedings against the Company's material
intellectual property assets and the Company could be forced into
bankruptcy or liquidation.
OMNICOMM SYSTEMS: Files Form 10-Q; Reports $1.5MM Income in Q2
--------------------------------------------------------------
OmniComm Systems, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income of $1.55 million on $4.06 million of total revenues for
the three months ended June 30, 2012, compared with a net loss of
$997,312 on $3.35 million of total revenues for the same period
during the prior year.
The Company reported a net loss of $1.82 million on $7.83 million
of total revenues for the six months ended June 30, 2012, compared
with a net loss of $4.89 million on $6.66 million of total
revenues for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $3.76 million
in total assets, $26.76 million in total liabilities and a $22.99
million total shareholders' deficit.
"The ability of the Company to continue in existence is dependent
on its having sufficient financial resources to bring products and
services to market for marketplace acceptance. As a result of our
historical operating losses, negative cash flows and accumulated
deficits for the period ending June 30, 2012 there is substantial
doubt about the Company's ability to continue as a going concern,"
the Company said in the Form 10-Q.
A copy of the Form 10-Q is available for free at:
http://is.gd/C1Nfix
About OmniComm Systems
Ft. Lauderdale, Fla.-based OmniComm Systems, Inc., is a healthcare
technology company that provides Web-based electronic data capture
("EDC") solutions and related value-added services to
pharmaceutical and biotech companies, clinical research
organizations, and other clinical trial sponsors principally
located in the United States and Europe.
OmniComm reported a net loss of $3.52 million in 2011, compared
with a net loss of $3.13 million in 2010.
OPTIONS MEDIA: Alpha Capital Discloses 9.9% Equity Stake
--------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Alpha Capital Anstalt disclosed that, as of July 15,
2012, it beneficially owns 110,727,247 shares of common stock of
Options Media Group Holdings, Inc., representing 9.9% of the
shares outstanding. A copy of the filing is available at:
http://is.gd/DauwG4
About Options Media
Boca Raton, Fla.-based Options Media Group Holdings, Inc., had
historically been an Internet marketing company providing e-mail
services to corporate customers. Additionally, Options Media has
a lead generation business and disposed of its SMS text messaging
delivery business. In 2010, Options Media transitioned by
changing its focus to smart phones and acquiring a robust anti-
texting program that prohibits people in vehicles from texting, e-
mailing, and reading such communications while moving. As part of
its focus on mobile software applications, Options Media has also
broadened its suite of products by continuing to improve the
features of its Drive Safe(TM) anti-texting software. In
conjunction with this change of focus, in February 2011, Options
Media sold its e-mail and SMS businesses. Options Media retains
its lead generation business.
The Company reported a net loss of $12.67 million in 2011,
compared with a net loss of $9.86 million in 2010.
The Company's balance sheet at March 31, 2012, showed $1.48
million in total assets, $8.16 million in total liabilities and a
$6.68 million total stockholders' deficit.
In its audit report for the 2011 results, Salberg & Company, P.A.,
in Boca Raton, Florida, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has a net loss available to common
stockholders of $12.75 million, and net cash used in continuing
operations of $3.60 million for the year ended Dec. 31, 2011, and
a working capital deficit, stockholders' deficit and accumulated
deficit of $4.11 million, $3.56 million and $35.5 million,
respectively at Dec. 31, 2011. The Company has also discontinued
certain operations.
OTOLOGICS LLC: Receives Court Approval of Auction Rules
-------------------------------------------------------
Stephanie Gleason at Dow Jones' DBR Small Cap reports that
medical-device manufacturer Otologics LLC won bankruptcy court
approval to auction its assets, which include technology for a
fully-implantable hearing aid, and to have industry-leader
Cochlear Ltd. serve as its lead bidder.
About Otologics
Otologics, L.L.C. filed a Chapter 11 petition (Bankr. E. D. Mo.
Case No. 12-47045) on July 23, 2012, in St. Louis, Missouri.
David A. Warfield, Esq., Thompson Coburn LLP serves as counsel to
the Debtor. The Debtor estimated up to $50,000,000 in assets and
liabilities.
The Debtor was founded in 1996 to acquire ceratin implantable
hearing device technology from Storz Instrument Co, and further
developand test such technology for future commercial
marketability. The Debtor's first product, the semi-implantable
MET (middle ear implant) has received the CE Mark and is currently
being sold in Europe. In October 2006, the Debtor completed the
European clinical trial for its second product, the fully
implantable CARINA middle ear implant, and received the CE Mark,
authorizing European sales. In the United States, the CARINA
fully implantable device is currently in Phase II clinical trials.
The Debtor and Cochlear Limited have already executed an Asset
Purchase Agreement where, subject to Court approval and potential
higher and better bids, Cochlear will purchase the sale assets for
approximately $14.0 million payable by a combination of credit
bids and cash.
OXLEY DEVELOPMENT: Returns to Chapter 11, This Time in Atlanta
--------------------------------------------------------------
Oxley Development Company, LLC, filed a Chapter 11 petition
(Bankr. N.D. Ga. Case No. 12-69799) in Atlanta Aug. 6, 2012.
Oxley Development owns the Laurel Bluff and Lauren Island, in
Camden County, Georgia. The Debtor, a single asset real estate
under 11 U.S.C. Sec. 101(51B), estimated assets of at least
$100 million and debts under $100 million.
According to the case docket, the schedules and other incomplete
filings are due in two weeks.
This is not the first time Oxley has sought bankruptcy protection.
In October 2011, Oxley filed a Chapter 11 petition in Brunswick
(Bankr. S.D. Ga. Case No. 11-21338). But the case was dismissed
at the behest of the U.S. Trustee. The bankruptcy judge in May
granted relief from stay to German American Capital Corporation,
allowing the creditor to pursue its state law remedies in
connection with the Debtor's real property.
William S. Orange, III, Attorney at Law, represented the Debtor in
the prior Chapter 11 case.
In the new case, the Debtor is represented by:
Paul Reece Marr, Esq.
PAUL REECE MARR, P.C.
300 Galleria Parkway, N.W., Suite 960
Atlanta, GA 30339
Tel: (770) 984-2255
Fax: (770) 984-0044
E-mail: paul@paulmarr.com
OXLEY DEVELOPMENT: Case Summary & 11 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Oxley Development Company, LLC
2221 Peachtree Road N.E., Suite D-165
Atlanta, GA 30309
Bankruptcy Case No.: 12-69799
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: Paul Reece Marr, Esq.
PAUL REECE MARR, P.C.
300 Galleria Parkway, N.W., Suite 960
Atlanta, GA 30339
Tel: (770) 984-2255
Fax: (770) 984-0044
E-mail: paul@paulmarr.com
Estimated Assets: $100,000,001 to $500,000,000
Estimated Debts: $50,000,001 to $100,000,000
The petition was signed by Carl M. Drury, III, president.
Affiliates that filed separate Chapter 11 petitions:
Entity Case No. Petition Date
------ -------- -------------
Atlanta Greenspace Initiative, LLC 11-66826 06/06/11
Exposition Hill, LLC 12-61273 04/30/12
Debtor's List of Its 11 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Tidewater Plantations, Inc. Loans $2,000,000
2221 Peachtree Road NE, Suite D-165
Atlanta, GA 30309
Pak Heydt & Associates, LLC Services $85,580
345 Peachtree Hills Avenue, NE, Suite 500
Atlanta, GA 30305
Minton Hester Personal Loans $38,000
P.O. Box 16099
Dublin, GA 31040
Public Affairs Marketing $30,000
Kevin Hart Associates Land Planning $22,000
Monocle Management, LLC Marketing $20,000
Bearing Point Development Construction Bids $7,500
and Planning
Keith Linch Attorney Fees $5,000
Greenberg Traurig Attorney Fees $5,000
Cutting Edge Homes Construction $2,500
Consulting
Camden County Tax Property Taxes Unknown
PACIFIC THOMAS: Files for Chapter 11 in Oakland
-----------------------------------------------
Pacific Thomas Corporation filed a Chapter 11 petition (Bankr.
N.D. Calif. Case No. 12-46534) in Oakland on Aug. 6, 2012,
estimating in excess of $10 million in assets and liabilities.
The Debtor in its list of holders of the largest unsecured claims
listed Summit Bank as holding a $7.69 million claim, although the
debt is disputed. Several affiliates of the Debtor also has
unsecured claims.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled
for Sept. 10, 2012 at 9:00 a.m.
The Debtor is related to Pacific Thomas Capital, which specializes
in real estate services, focusing on the investment, ownership and
development of commercial real estate properties, according to
http://www.pacificthomas.com/ Real estate activities has spanned
throughout the Hawaiian Islands as well as U.S. West Coast
locations in California, Nevada, Arizona and Utah. Hawaii based
activities are managed under the name Thomas Capital Investments.
PACIFIC THOMAS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Pacific Thomas Corporation
dba Pacific Thomas Capital
1818 Mt. Diablo Boulevard, Suite D
Walnut Creek, CA 94596
Bankruptcy Case No.: 12-46534
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Northern District of California (Oakland)
Judge: M. Elaine Hammond
Debtor's Counsel: Anne-Leith Matlock, Esq.
MATLOCK LAW GROUP, P.C.
1485 Treat Boulevard, #200
Walnut Creek, CA 94597
Tel: (925)944-7131
E-mail: anne-leith@matlocklawgroup.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Jill V. Worsley, COO, secretary.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Darrow Family Partners -- $1,350,908
1600 Ala Moana, #1112
Honolulu, HI 96815
Thomas Capital Investments -- $1,081,412
1600 Ala Moana, #1112
Honolulu, HI 96815
Summit Bank Mortgage $898,123
2969 Broadway
Oakland, CA 94694
Buhla R. Darrow Trust -- $388,864
1600 Ala Moana, #1112
Honolulu, HI 96815
Thomas Koolaupoko Inv. -- $368,574
1600 Ala Moana #1112
Honolulu, HI 96815
Randall Whitney Personal Loan $201,050
Richard Douglas Worsley Professional Services $75,000
Grubb & Ellis Company Professional Services $70,000
A.M. Tarbell Trust -- $60,525
CBRE, Inc. Professional Services $30,000
KCA Engineers, Inc. Professional Services $28,926
Baird Holm Attorneys At Law Professional Services $26,616
Alameda County Treasurer & Tax Property Tax $26,095
Collection
Timothy Brophy, CPA< MBA Professional Services $19,186
Alameda County Treasurer & Tax Property Tax $16,159
Collection
Wendel Roesn Black & Dean, LLP Professional Services $12,636
Charles M. Salter Associates, Inc. Professional Services $11,691
BKD, LLP Professional Tax $11,135
Services
Environmental Science Assoc. Professional Services $9,500
Doris Rydman Personal Loan $5,000
PATRIOT COAL: Court Approves $802-Mil. DIP Financing
----------------------------------------------------
Patriot Coal Corporation disclosed that the U.S. Bankruptcy Court
for the Southern District of New York has entered a final order
approving Patriot's $802 million Debtor-in-Possession financing.
The DIP financing and cash from the Company's ongoing operations
are expected to provide Patriot with financial flexibility to
operate its business during the reorganization process.
In addition, the Bankruptcy Court granted final orders authorizing
Patriot to continue to pay wages and provide health care and other
benefits to employees, continue existing customer programs and use
existing cash management systems. Patriot's mining operations and
customer shipments are continuing as usual.
"We are pleased with Patriot's initial progress in the
restructuring process and are continuing to identify the necessary
changes to ensure the Company's future viability," said Patriot
Chairman and Chief Executive Officer Irl F. Engelhardt.
"Management is reviewing every aspect of the business to make sure
we operate as efficiently and productively as possible, while
maintaining our focus on safety."
As previously announced, Patriot Coal and substantially all of its
wholly owned subsidiaries filed voluntary petitions for
reorganization under Chapter 11 of the Bankruptcy Code on July 9,
2012. The case has been assigned to the Honorable Shelley C.
Chapman.
About Patriot Coal Corp.
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO.
The case has been assigned to Judge Shelley C. Chapman
PATRIOT COAL: Unsecured Creditors Committee Has Seven Members
-------------------------------------------------------------
Tracy Hope Davis, the U.S. Trustee for Region 2 appointed
creditors who are willing to serve on the Official Committee of
Unsecured Creditors in the Chapter 11 cases of Patriot Coal
Corporation, et al.
The Committee is comprised of:
1. Wilmington Trust Company
Attn: Steven Cimalore
1100 North Market Street
Wilmington, DE 19840
Tel: (302) 636-6058
Fax: (302) 636-4149
2. U.S. Bank National Association
Attn: Laura L. Moran
One Federal Street, 3rd Floor
Mail Station: EX-MA-FED
Boston, MA 02110
Tel: (617) 603-6429
Fax: (617) 603-6640
3. United Mine Workers of America
Attn: Michael Buckner
18354 Quantico Gateway Drive #200
Triangle, VA 22172
Tel: (703) 291-2408
Fax: (703) 291-2451
4. United Mine Workers of America 1974
Pension Plan and Trust
Attn: L. Newsome
2121 K Street, N.W.
Washington, DC 20037
Tel: (202) 521-2222
Fax: (202) 530-4022
5. Gulf Coast Capital Partners, LLC
Attn: Chadd Garcia
5150 Tamilmi Trail N., Suite 504
Naples, FL 34103
Tel: (239) 687-2006
Fax: (239) 659-0220
6. Cecil Walker Machinery
Attn: Kevin Lee
1400 Cecil Avenue
Louisville, KY 40211
Tel: (502) 774-4441
Fax: N/A
7. American Electric Power
Attn: Marilyn McConnell
1 Riverside Plaza, 29th Floor
Columbus, OH 43215
Tel: (614) 716-2964
Fax: (614) 716-1687
About Patriot Coal Corp.
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The case has been assigned to Judge Shelley C. Chapman.
PATRIOT COAL: Proposes Garden City Group as Admin. Agent
--------------------------------------------------------
Patriot Coal Corporation, et al., ask the U.S. Bankruptcy Court
for the Southern District of New York for permission to employ
GCG, Inc. as administrative agent.
According to the Debtors' case docket, on July 11, the Hon. Allan
L. Gropper authorized the Debtors to employ GCG, Inc., as claims
and noticing agent.
The Debtors relate that given that the administration of the
Chapter 11 cases will require GCG to perform duties outside the
scope of the Section 156 order, the Debtors submit this Section
327 application.
GCG will, among other things:
a) assist with the preparation and filing of the Debtors'
schedules of assets and liabilities and statements of
financial affairs;
b) generate and provide claim reports and claim objection
exhibits, as requested by the Debtors and their
professionals; and
c) manage the preparation, compilation and mailing of documents
to creditors and other parties in interest in connection
with the solicitation of a chapter 11 plan.
The Debtors say that GCG will coordinate with the Debtors' other
retained professionals to avoid any unnecessary duplication of
services.
GCG has received a $500,000 retainer from the Debtors. GCG will
apply the retainer first, against all prepetition fees and
expenses, and then, against the first bill rendered by GCG to the
Debtors for postpetition fees and expenses incurred by the Debtors
with respect to the Chapter 11 cases.
Angela Ferrante, vice president of GCG, assures the Court that GCG
is a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.
About Patriot Coal Corp.
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The case has been assigned to Judge Shelley C. Chapman.
The U.S. Trustee appointed a seven-member creditors committee.
PEMCO WORLD: Has New Sale Deal With Sun Capital Affiliate
---------------------------------------------------------
Pemco World Air Services on Aug. 6 filed with the Bankruptcy Court
for the district of Delaware an amended and restated Asset
Purchase Agreement with Avion Services Holdings, LLC, an affiliate
of Sun Capital Partners, Inc. The Company anticipates that the
sale to Avion Services Holdings, LLC will be completed before the
end of August, at which time the new company will be a stronger
and more viable business.
"This is a very positive development. It reaffirms the Company's
strategy that it undertook in restructuring Pemco to emerge with
its strongest ever balance sheet and excellent capital structure,"
said William Meehan, Chief Executive Officer of Pemco. "This
allows us to grow our business and remain an industry leader. I am
very excited and firmly believe that our best days are ahead of
us."
The Company also said that it has agreed with Vision Technologies
Aerospace to terminate the Asset Purchase Agreement entered into
on May 23, 2012, with VT Aerospace.
Karen Walker at Air Transport World reports that Avion Services
has provided debtor-in-possession financing to Pemco since the
bankruptcy filing, allowing Pemco to continue payments to
employees and suppliers.
Air Transport World relates taht ST Engineering confirmed the
termination of its acquisition agreement, saying the decision was
made after certain closing conditions could not be fulfilled by
the seller prior to the closing deadline.
About Pemco World Air Services
Headquartered in Tampa, Florida Pemco World Air Services --
http://www.pemcoair.com/-- performs large jet MRO services, and
has operations in Dothan, AL (military MRO and commercial
modification), Cincinnati/Northern Kentucky (regional aircraft
MRO), and partner operations in Asia.
Pemco filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case
No. 12-10799) on March 5, 2012. Young Conaway Stargatt & Taylor,
LLP has been tapped as general bankruptcy counsel; Kirkland &
Ellis LLP as special counsel for tax and employee benefits issues;
AlixPartners, LLP as financial advisor; Bayshore Partners, LLC as
investment banker; and Epiq Bankruptcy Solutions LLC as notice and
claims agent.
On March 14, 2012, the U.S. Trustee appointed an official
committee of unsecured creditors.
On April 13, 2012, Sun Aviation Services LLC (Bankr. D. Del. Case
No. 12-11242) filed its own Chapter 11 bankruptcy petition. Sun
Aviation owns 85.08% of the stock of Pemco debtor-affiliate WAS
Aviation Services Holding Corp., which in turn owns 100% of the
stock of debtor WAS Aviation Services Inc., which itself owns 100%
of the stock of Pemco World Air Services Inc. Pemco also owes Sun
Aviation $5.6 million. As a result, Sun Aviation is seeking
separate counsel. However, Sun Aviation obtained an order jointly
administering its case with those of the Pemco debtors.
On June 15 the bankruptcy court approved sale of Pemco's business
for $41.9 million cash to an affiliate of VT Systems Inc. from
Alexandria, Virginia. Boca Raton, Florida-based Sun Capital was
under contract to make the first bid at auction for the provider
of heavy maintenance and repair services for commercial jet
aircraft.
PEREGRINE FINANCIAL: U.S. Bank Named as Defendant
-------------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle reports that U.S. Bank NA, which held
customer money for Peregrine Financial Group Inc., was named
defendant in a new lawsuit filed by a client of the firm.
The bank knew or should have known the collapsed commodities
brokerage had insufficient funds on deposit, the new lasuit
claimed.
"Even if U.S. Bank had no direct knowledge of Wasendorf Sr.'s
fraud until it became public, U.S. Bank was grossly negligent in
failing to detect the fraud," Marcus Ibrahim said in his complaint
filed Aug. 3 in federal court in Chicago.
"We believe the case is without merit," Tom Joyce, a spokesman for
Minneapolis-based U.S. Bancorp, said in a phone interview. Having
reviewed the historic account activity, "the company does not
believe there is any evidence of employee involvement in the
fraudulent activity."
According to the Bloomberg report, the bank said in an Aug. 3
quarterly report for the period ended June 30 that it was
cooperating with a court-appointed receiver in the case filed by
the U.S. Commodity Futures Trading Commission, with the Chapter 7
bankruptcy trustee and with the federal government's investigation
into the actions of the firm and its chairman-founder.
The U.S. Bank case is Ibrahim v. Wasendorf Sr., 12-cv-06137, U.S.
District Court, Northern District of Illinois (Chicago).
About Peregrine Financial
Peregrine Financial Group Inc. filed to liquidate under Chapter 7
of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 12-27488)
on July 10, 2012, disclosing between $500 million and $1 billion
of assets, and between $100 million and $500 million of
liabilities.
Earlier that day, at the behest of the U.S. Commodity Futures
Trading Commission, a U.S. district judge appointed a receiver and
froze the firm's assets. The firm put itself into bankruptcy
liquidation in Chicago later the same day. The CFTC had sued
Peregrine, saying that more than $200 million of supposedly
segregated customer funds had been "misappropriated." The CFTC
case is U.S. Commodity Futures Trading Commission v. Peregrine
Financial Group Inc., 12-cv-5383, U.S. District Court, Northern
District of Illinois (Chicago).
Peregrine's Chief Executive Russell R. Wasendorf Sr.
unsuccessfully attempted suicide outside a firm office in Cedar
Falls, Iowa, on July 9.
The bankruptcy petition was signed in his place by Russell R.
Wasendorf Jr., the firm's chief operating officer. The resolution
stated that Wasendorf Jr. was given a power of attorney on July 3
to exercise if Wasendorf Sr. became incapacitated.
Peregrine Financial Group Inc. is the regulated unit of the
brokerage PFGBest.
At a quickly-convened hearing on July 13, the bankruptcy judge
authorized the Chapter 7 trustee to operate Peregrine's business
on a "limited basis" through Sept. 13.
PHILADELPHIA NEWSPAPERS: $1.8-Mil. Claim Won't Upset Plan
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that consummation of a confirmed Chapter 11 plan didn't result in
making an appeal on a $1.8 million administrative claim equitably
moot, the U.S. Court of Appeals in Philadelphia ruled on July 27
in the completed bankruptcy reorganization of the Philadelphia
Inquirer newspaper.
According to the report, managers of a charter school contended
they were defamed by an article published in the newspaper before
bankruptcy. After bankruptcy, the prior story was linked to a new
story on an Internet version of the paper. The charter school
operators contended that linking to the prior story was a
republication giving rise to a new defamation claim that would be
an expense of administration of the Chapter 11 case to be paid in
full. The bankruptcy judge denied the administrative claim,
saying that linking was "not distinct tortuous conduct." according
to the report when the plan was confirmed, the school operators
didn't seek a stay pending appeal. On appeal, the district court
dismissed the appeal, saying it was "equitably moot."
The report relates that Circuit Judge Thomas L. Ambro, writing for
the 3rd U.S. Circuit Court of Appeals in Philadelphia, disagreed
with the district court ruling. Judge Ambro said that reversing
the bankruptcy court and allowing the $1.8 million claim "will not
upset the plan." Consequently, the doctrine of equitable mootness
does not apply, he said. Judge Ambro noted that the claim
amounted to only 1.7% of the price for which the business was sold
under the plan. Although concluding that the appeal could go
forward, Judge Ambro agreed with the bankruptcy court that linking
the article to a new story was not republication giving rise to a
new claim.
The report notes Judge Ambro's opinion made law involving
defamation and the Internet. He held that the single-publication
rule applies to the Internet and that linking an old story to a
new one is not republication. The doctrine of equitable mootness
blocks an appeal where there was no stay pending appeal and
reversal would upset the confirmed plan.
The case is In re Philadelphia Newspapers LLC, 11-3257, U.S. 3rd
Circuit Court of Appeals (Philadelphia)
About Philadelphia Newspapers
Philadelphia Newspapers, LLC -- http://www.philly.com/-- owned
and operated numerous print and online publications in the
Philadelphia market, including the Philadelphia Inquirer, the
Philadelphia Daily News, several community newspapers, the
region's number one local Web site, philly.com, and a number of
related online products. The Company's flagship publications were
the Inquirer, the third oldest newspaper in the country and the
winner of numerous Pulitzer Prizes and other journalistic
recognitions, and the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No.
09-11204) on Feb. 22, 2008. Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. Philadelphia Newspapers estimated
assets and debts of $100 million to $500 million in its Chapter 11
petition.
The Debtors proposed a plan of reorganization which would sell
substantially all of their assets at an auction. The Philadelphia
Media Network, which was formed by the Debtors' secured lenders,
acquired the Philadelphia Inquirer, the Daily News and Philly.com
for $105 million in cash. The Court approved the sale and
confirmed a revised plan at a hearing on Sept. 30.
Philadelphia Newspapers previously won confirmation of a plan
based on the sale of the business to the same group of lenders for
$139 million. The sale failed to close because the buyers weren't
able to reach agreement on a new labor contract with the Teamsters
union. After another auction on Sept. 23, the lenders again
emerged as the winning bidder but with a lower offer.
The Plan became effective and the sale closed on Oct. 8, 2010.
PICHI'S INC: Court Grants Dismissal of Chapter 11 Case
------------------------------------------------------
The Hon. Edward A. Godoy of the U.S. Bankruptcy Court for the
District of Puerto Rico has dismissed the Chapter 11 bankruptcy
case of Pichi's Inc.
On March 14, 2012, the Debtor asked the Court to dismiss its case,
saying that it will be unable to reorganize under Chapter 11. Its
assets are substantially encumbered in favor of Banco Popular de
Puerto Rico, as reflected by the Debtor's schedules. The Debtor's
monthly operating reports reveal that it is operating at a loss.
The operation of the Debtor's casino is to be affected by
different motions filed by the owners of the gaming machines
directed to their recovery due to the Debtor's inability to pay
amounts required by the leases.
The Debtor attempted to obtain post-petition financing, as well as
explored the selling of its assets to interested parties, in order
to structure a plan, to no avail.
On June 14, 2012, BPPR, the Puerto Rico Tourism Company, and Bally
Gaming, Inc., joined the Debtor in its plea to dismiss the case.
The Debtor and its guarantors have consented to BPPR foreclosing
on all of collateral and the immediate appointment of an
administrator to run the Debtor's operations. Bally agreed to
transfer to the Debtor certain assets which include 52 slot
machines and the marketing and operating system for the Debtor's
casino. The purchase price for the assets will be $800,000,
payable in equal monthly payments during a period of 24 months by
the Debtor, through BPPR's appointed administrator, and guaranteed
by BPPR. With the second monthly payment, the Debtor, through
BPPR's appointed administrator, will pay an additional $25,000 to
Bally to be deducted from the agreed upon purchase price. The
first payment will be due when the conditions precedent have
occurred. BPPR will have the right to cure any default, at its
discretion, of the Debtor under the agreement with Bally for the
purchase of the assets.
About Pichi's Inc.
Pichi's Inc. owns and operates the Best Western Pichi's Hotel in
Guayanilla, Puerto Rico. Pichi's filed for Chapter 11 bankruptcy
(Bankr. D. P.R. Case No. 11-06583) on Aug. 3, 2011. Judge Mildred
Caban Flores initially presided over the case, which has recently
been reassigned to the Hon. Edward A. Godoy. Charles A. Cuprill,
Esq., at Charles A. Cuprill, P.S.C., Law Offices, in San Juan,
Puerto Rico, serves as the Debtor's bankruptcy counsel. CPA Luis
R. Carrasquillo & Co., P.S.C., serves as financial consultants.
The petition was signed by Luis A. Emmanuelli Gonzalez, president.
In its schedules, the Debtor disclosed $31,402,359 in assets and
$36,619,020 in liabilities.
Luis C. Marini, Esq., and Ubaldo M. Fernandez, Esq., at O'Neill &
Borges, in San Juan, Puerto Rico, represents Banco Popular de
Puerto Rico as counsel.
PINNACLE AIRLINES: Shareholders Seek to Right to Sue Delta
----------------------------------------------------------
Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports
that hedge funds are looking to preserve their right to sue Delta
Air Lines Inc. over allegations that the carrier is running
Pinnacle Airlines Corp.'s bankruptcy case for its own benefit and
without regard for Pinnacle's survival.
About Pinnacle Airlines
Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/--
a $1 billion airline holding company with 7,800 employees, is the
parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.;
and Colgan Air, Inc. Flying as Delta Connection, United Express
and US Airways Express, Pinnacle Airlines Corp. operating
subsidiaries operate 199 regional jets and 80 turboprops on more
than 1,540 daily flights to 188 cities and towns in the United
States, Canada, Mexico and Belize. Corporate offices are located
in Memphis, Tenn., and hub operations are located at 11 major U.S.
airports.
Pinnacle Airlines Inc. and its affiliates, including Colgan Air,
Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East
Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr.
S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012.
Judge Robert E. Gerber presides over the case. Lawyers at Davis
Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve
as the Debtors' counsel. Barclays Capital and Seabury Group LLC
serve as the Debtors' financial advisors. Epiq Systems -
Bankruptcy Solutions serves as the claims and noticing agent. The
petition was signed by John Spanjers, executive vice president and
chief operating officer.
Pinnacle Airlines' balance sheet at Sept. 30, 2011, showed $1.53
billion in total assets, $1.42 billion in total liabilities and
$112.31 million in total stockholders' equity. Debtor-affiliate
Colgan Air, Inc. disclosed $574,482,867 in assets and $479,708,060
in liabilities as of the Chapter 11 filing.
Delta Air Lines, Inc., the Debtors' major customer and post-
petition lender, is represented by David R. Seligman, Esq., at
Kirkland & Ellis LLP.
A seven-member official committee of unsecured creditors has been
appointed in the case. The Committee selected Goodrich
Corporation as its chairperson. The Committee tapped Morrison &
Foerster LLP as its counsel.
PLATINUM PROPERTIES: Wants Until Oct. 25 to File Chapter 11 Plan
----------------------------------------------------------------
Platinum Properties, LLC, et al. ask the U.S. Bankruptcy Court for
the Southern District of Indiana to extend their exclusive periods
to file and solicit acceptances for the proposed chapter 11 plan
of reorganization until Oct. 25, 2012, and Dec. 25, 2012,
respectively.
The exclusivity period terminates on Oct. 25, and Dec. 25, absent
a fourth extension.
In the foruth extension motion, the Debtors explained that they
require additional time to negotiate with creditors to ascertain
the viability of the alternative exit strategies. The Debtors
have reached agreements, or expect to soon reach agreements, with
the majority of their key creditors and terminating exclusivity at
this stage of the Chapter 11 cases will imperil the Debtors'
ongoing negotiations with its creditors.
About Platinum Properties and PPV LLC
Indianapolis, Indiana-based Platinum Properties, LLC, is a
residential real estate developer. Platinum acquires land,
designs the projects, obtains zoning and other approvals, and
constructs roads, drainage, utilities, and other infrastructure of
residential subdivisions. Platinum then sells the finished,
platted lots. Platinum also has an ownership interest in several
special purpose entities that in turn own, operate and manage
individual projects.
PPV LLC is a joint venture between Platinum and a non-debtor
entity, Pittman Partners, Inc., each of whom hold an equity
interest in PPV. PPV owned four projects directly and owns 100%
of the membership interest of Sweet Charity Estates, LLC.
Platinum Properties and PPV LLC filed for Chapter 11 protection
(Bankr. S.D. Ind. Case Nos. 11-05140 and 11-05141) on April 25,
2011. Lawyers at Baker & Daniels LLP, in Indianapolis, Indiana,
serve as the Debtors' bankruptcy counsel. Platinum Properties
disclosed $14,624,722 in assets and $181,990,960 in liabilities as
of the Chapter 11 filing.
The U.S Trustee has not yet appointed a creditors committee in the
Debtor's case. The U.S. Trustee reserves the right to appoint
such a committee should interest developed among the creditors.
PMI GROUP: CFO Resigns, Moves to California Company
---------------------------------------------------
Donald P. Lofe, Jr., will begin his new position as the Chief
Financial Officer of a San Francisco, California-based company
that provides fully automated and customized weather insurance
products to the agricultural industry effective Sept. 4, 2012.
Mr. Lofe had informed The PMI Group, Inc., that he had accepted an
offer of employment with a San Francisco, California-based company
and of his intention to resign as Executive Vice President, Chief
Financial Officer and Chief Administrative Officer of TPG upon the
completion of an appropriate transition period. The effective
date of his resignation from TPG will be Sept. 3, 2012.
About The PMI Group
Del.-based The PMI Group, Inc., is an insurance holding company
whose stock had, until Oct. 21, 2011, been publicly-traded on the
New York Stock Exchange. Through its principal regulated
subsidiary, PMI Mortgage Insurance Co., and its affiliated
companies, the Debtor provides residential mortgage insurance in
the United States.
The PMI Group filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 11-13730) on Nov. 23, 2011. In its schedules, the Debtor
disclosed $167,963,354 in assets and $770,362,195 in liabilities.
Stephen Smith signed the petition as chairman, chief executive
officer, president and chief operating officer.
The Debtor said in the filing that it does not have the financial
resources to pay the outstanding principal amount of the 4.50%
Convertible Senior Notes, 6.000% Senior Notes and the 6.625%
Senior Notes if those amounts were to become due and payable.
The Debtor is represented by James L. Patton, Esq., Pauline K.
Morgan, Esq., Kara Hammond Coyle, Esq., and Joseph M. Barry, Esq.,
at Young Conaway Stargatt & Taylor LLP.
The Official Committee of Unsecured Creditors appointed in the
case retained Morrison & Foerster LLP and Womble Carlyle Sandridge
& Rice, LLP, as bankruptcy co-counsel. Peter J. Solomon Company
serves as the Committee's financial advisor.
POINT BLANK: Court Approves Settlement Deal
-------------------------------------------
BankruptcyData.com reports that the U.S. Bankruptcy Court approved
Point Blank Solutions' motion for approval of a settlement
agreement among the Debtors, the official committee of unsecured
creditors, the official committee of equity security holders and
certain D.I.P. lender parties. The agreement globally resolves
that portion of the equity committee's motion for an order
vacating interim and final debtor-in-possession financing orders
with respect to Lonestar and the other lender parties.
About Point Blank
Headquartered in Pompano Beach, Florida, Point Blank Solutions,
Inc. -- http://www.pointblanksolutionsinc.com/-- designs and
produces body armor systems for the U.S. Military, Government and
law enforcement agencies, as well as select international markets.
The Company maintains facilities in Pompano Beach, Florida, and
Jacksboro, Tennessee.
The Company's former chief executive officer and chief operating
officer were convicted in September 2010 of orchestrating a
$185 million fraud.
Point Blank Solutions, formerly DHB Industries, filed for
Chapter 11 protection (Bankr. D. Del. Case No. 10-11255) on
April 14, 2010. Laura Davis Jones, Esq., Alan J. Kornfeld, Esq.,
David M. Bertenthal, Esq., and Timothy P. Cairns, Esq., at
Pachulski Stang Ziehl & Jones LLP, serve as bankruptcy counsel to
the Debtor. Olshan Grundman Frome Rosenweig & Wolosky LLP serves
as corporate counsel. T. Scott Avila of CRG Partners Group LLC is
the restructuring officer. Epiq Bankruptcy Solutions serves as
claims and notice agent.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Equity Security
Holders in the case. Ian Connor Bifferato, Esq., and Thomas F.
Driscoll III, Esq., at Bifferato LLC; and Carmen H. Lonstein,
Esq., Andrew P.R. McDermott, Esq., and Lawrence P. Vonckx, Esq.,
at Baker & McKenzie LLP, serve as counsel for the Official
Committee of Equity Security Holders. Robert M. Hirsh, Esq., and
George P. Angelich, Esq., at Arent Fox LLP, serve as counsel to
the Creditors Committee, and Frederick B. Rosner, Esq., and
Brian L. Arban, Esq., at the Rosner Law Group LLC, serve as
co-counsel.
PORTER BANCORP: Files Form 10-Q, Incurs $319,000 Net Loss in Q2
---------------------------------------------------------------
Porter Bancorp, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
available to common shareholders of $319,000 on $10.79 million of
net interest income for the three months ended June 30, 2012,
compared with a net loss available to common shareholders of
$38.96 million on $13.44 million of net interest income for the
same period during the prior year.
The Company reported net income available to common shareholders
of $661,000 on $22.24 million of net interest income for the six
months ended June 30, 2012, compared with a net loss available to
common shareholders of $38.60 million on $27.20 million of net
interest income for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $1.33 billion
in total assets, $1.25 billion in total liabilities and $81.50
million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/pSFsyC
About Porter Bancorp
Porter Bancorp, Inc., is a bank holding company headquartered in
Louisville, Kentucky. Through its wholly-owned subsidiary PBI
Bank, the Company operates 18 full-service banking offices in
twelve counties in Kentucky.
Crowe Horwath, LLP, in Louisville, Kentucky, audited Porter
Bancorp's financial statements for 2011. The independent auditors
said that the Company has incurred substantial losses in 2011,
largely as a result of asset impairments. "In addition, the
Company's bank subsidiary is not in compliance with a regulatory
enforcement order issued by its primary federal regulator
requiring, among other things, increased minimum regulatory
capital ratios. Additional significant asset impairments or
continued failure to comply with the regulatory enforcement order
may result in additional adverse regulatory action."
The Company reported a net loss of $107.31 million in 2011,
compared with a net loss of $4.38 million in 2010.
POSITIVEID CORPORATION: Has $2.3 Million Net Loss in 1st Quarter
----------------------------------------------------------------
PositiveID Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $2.35 million on $0 revenue for the three
months ended March 31, 2012, compared with a net loss of
$2.21 million on $0 revenue for the same period in 2011.
The Company's balance sheet at March 31, 2012, showed
$2.99 million in total assets, $4.17 million in total liabilities,
and a stockholders' deficit of $1.18 million.
EisnerAmper LLP, in New York, N.Y., expressed substantial doubt
about PositiveID's ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has a
working capital deficiency and an accumulated deficit.
"Additionally, the Company has incurred operating losses since its
inception and expects operating losses to continue during 2012.
A copy of the Form 10-Q is available for free at:
http://is.gd/Q7Bod6
Delray Beach, Fla.-based PositiveID Corporation has historically
developed, marketed and sold RFID systems used for the
identification of people in the healthcare market. Beginning in
early 2011, the Company has focused its strategy on the growth of
its HealthID business, including the continued development of its
GlucoChip, its Easy Check breath glucose detection device, its
iglucose wireless communication system, and potential strategic
acquisition opportunities of businesses that are complementary to
its HealthID business.
PRECISION OPTICS: To Eliminate Former CEO's Life Insurance
----------------------------------------------------------
Precision Optics Corporation, Inc.'s Board of Directors approved
an arrangement with Mr. Richard E. Forkey, whereby a payment of
$40,000 will be made to Mr. Forkey in exchange for canceling Mr.
Forkey's life insurance policy, on which the Company had been
paying the policy premiums.
Mr. Forkey resigned as the Company's Chief Executive Officer in
February 2011. He remains a director of the Company and currently
holds the executive position of advisor to the Chief Executive
Officer.
The life insurance policy has been in effect for over 25 years.
The purpose of the Board's decision is to eliminate the Company's
obligation to pay future premiums on the policy, while recognizing
Mr. Forkey's former and ongoing contributions to the Company. The
timing of the cancellation of the policy and payment to Mr. Forkey
will be based on mutual agreement between Mr. Forkey and the
Company.
About Precision Optics
Headquartered in Gardner, Massachusetts, Precision Optics
Corporation, Inc., has been a developer and manufacturer of
advanced optical instruments since 1982. The Company designs and
produces high-quality micro-optics, medical instruments and other
advanced optical systems. The Company's medical instrumentation
line includes laparoscopes, arthroscopes and endocouplers and a
world-class product line of 3-D endoscopes for use in minimally
invasive surgical procedures.
As reported in the TCR on Sept. 27, 2010, Stowe & Degon LLC, in
Westborough, Mass., expressed substantial doubt about Precision
Optics' ability to continue as a going concern, following the
Company's results for the fiscal year ended June 30, 2010. The
independent auditors noted that the Company has suffered recurring
net losses and negative cash flows from operations. Stowe &
Degon's 2011 audit report did not include a going concern
qualification.
The Company reported a net loss of $1.05 million for the fiscal
year ended June 30, 2011, compared with a net loss of $660,882 in
the preceding year.
The Company's balance sheet at March 31, 2012, showed $1.33
million in total assets, $625,967 in total liabilities, all
current, and $713,601 in total stockholders' equity.
PROBE MANUFACTURING: Had $12,700 Net Income in 1st Quarter
----------------------------------------------------------
Probe Manufacturing, Inc., filed its quarterly report on Form 10-
Q, reporting net income of $12,717 on $1.29 million of sales for
the three months ended March 31, 2012, compared with net income of
$24,729 on $906,313 of sales for the same period last year.
The Company's balance sheet at March 31, 2012, showed
$1.98 million in total assets, $1.63 million in total liabilities,
and stockholders' equity of $354,063.
The Company had an accumulated deficit of $(225,766) as of
March 31, 2012.
As reported in the TCR on April 16, 2012, W. T. Uniack & Co. CPA's
P.C., in Woodstock, Georgia, noted that the Company has current
assets of $1,460,906 and current liabilities of $1,260,952.
"Sales have increased from $2,799,935 in 2010 to $4,549,798 for
the comparable period in 2011. In addition, the Company has an
accumulated deficit of ($238,483) and is dependent on at least
maintaining current revenue levels. Those conditions raise
substantial doubt about the Company's ability to continue as a
going concern," the auditor said.
A copy of the Form 10-Q is available for free at:
http://is.gd/vUtQwp
Irvine, California-based Probe Manufacturing, Inc., provides
global design and manufacturing services to original electronic
equipment manufacturers from its 23000 sq-ft facility in Irvine,
California and strategic locations worldwide. Revenue is
generated from sales of services primarily to customers in the
medical device, aerospace, automotive, industrial and
instrumentation product manufacturers.
RESIDENTIAL CAPITAL: Citibank Objects to Gilberts' Dismissal Plea
-----------------------------------------------------------------
Citibank, N.A., objects to the request of Rex T. Gilbert, Jr., and
Daniela L. Gilbert, to dismiss Residential Capital's Chapter 11
cases, or in the alternative modify the automatic stay to allow
the Gilberts' lawsuit pending in the U.S. Court of Appeals for the
Fourth Circuit to proceed.
Citibank argues that dismissal of the cases is inappropriate
because the Gilberts have failed to establish that any of the
"actions" they enumerated constitute "cause," which is required
for the Court to dismiss the Debtors' cases. Furthermore,
dismissal of the cases is neither in the best interest of
creditors nor is it in the best interest of the Debtors' estates,
Citibank argues.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
ResCap is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and its legacy portfolio,
consisting mainly of mortgage loans and other residual financial
assets, to Ally Financial. Together, the asset sales are expected
to generate approximately $4 billion in proceeds.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Creditors Seek Stay Relief to Pursue Lawsuits
------------------------------------------------------------------
Several parties-in-interest filed motions asking the U.S.
Bankruptcy Court for the Southern District of New York to lift the
automatic stay to allow them to pursue legal processes outside the
bankruptcy court. They include:
-- Shellpoint Partners LLC, f/k/a Shellpoint Mortgage LLC, and
New Penn Financial, LLC;
-- The National Association of Consumer Bankruptcy Attorneys;
-- Steven Archibald, Nicolle Bradbury, Thomas True, Shawn
Morisette, and Joseph Phillips (collectively called the
"Maine Action Plaintiffs");
-- Community South Bank;
-- Christina Ulbrich;
-- Deborah Bollinger and Bryan Bubnick;
-- Paul N. Papas II;
-- Vermont Housing Finance Agency;
-- Mary Gardner;
-- Hitoshi and Wakana Inoue;
-- Alan Irving Moss;
-- Kenneth Taggart;
-- the People of the State of New York;
-- Third Federal Savings and Loan Association; and
-- Hedeya Haroutunian.
The parties-in-interest seek modification of the automatic stay
to, among other things, terminate prepetition agreements with
certain Debtors, and to pursue prepetition lawsuits pending in
state and federal courts.
The NACB seeks relief from the automatic stay to permit borrowers
in individual bankruptcy cases to seek any relief, other than
affirmative monetary recovery that is based on actions that
occurred before the Petition Date, whether that relief is sought
by claim, counterclaim, defense or otherwise. NACBA is a non-
profit organization of more than 4,400 consumer bankruptcy
attorneys nationwide.
The People of the State of New York seeks relief from the
automatic stay to pursue a civil litigation pending in the
Supreme Court, Nassau County, captioned State of New York v.
Empire Property Solutions, LLC et al. (Index No. 09-017767).
* * *
The Debtors and Shellpoint entered into a stipulation approved by
the Court modifying the automatic stay to allow Shellpoint to
terminate its prepetition servicing agreement with the Debtors.
The Bankruptcy Court also modified the automatic stay to allow
the Maine Supreme Court to issue its decision with respect to the
question certified to it by the U.S. District Court for the
District of Maine in the Main Action.
A consent order was entered modifying the automatic stay to allow
Community South Bank to complete foreclosure of two mortgages and
security interests it holds on a certain mortgaged property.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
ResCap is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and its legacy portfolio,
consisting mainly of mortgage loans and other residual financial
assets, to Ally Financial. Together, the asset sales are expected
to generate approximately $4 billion in proceeds.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Files Amended Schedules of Assets & Debts
--------------------------------------------------------------
Residential Capital, LLC, disclosed in its schedules of assets
and liabilities, amended as of July 3, 2012, that it had
$3.5 billion in assets composed of personal property and $6.5
billion in liabilities composed of $3.5 billion in secured claims
and $2.9 billion in unsecured non-priority claims. A copy of the
Schedule is available for free at:
http://bankrupt.com/misc/rescap_july03sal.pdf
In its amended statement of financial affairs, dated July 19,
2012, ResCap disclosed payments made to creditors, including
insiders, during the 90-day period prior to the Petition Date. A
copy of the Statement is available for free at:
http://bankrupt.com/misc/rescap_july19sofa.pdf
RFC's Amended Schedules
Residential Funding Company, LLC, disclosed in its schedules of
assets and liabilities, amended on July 3, 2012, that it has
$3.781 billion in assets composed of $13.16 million in real
property and $3.77 billion in personal property and $2.460
billion in liabilities composed of $1.12 billion in secured
claims, $151,125 in unsecured priority claims and $1.33 billion
in unsecured non-priority claims. A copy of the Schedule is
available for free at http://bankrupt.com/misc/rfc_july03sal.pdf
In its amended statement of financial affairs, dated July 19,
2012, RFC disclosed payments made to creditors, including
insiders, during the 90-day period prior to the Petition Date. A
copy of the Statement is available for free at:
http://bankrupt.com/misc/rfc_july19sofa.pdf
GMAC Mortgage's Amended Schedules
GMAC Mortgage, LLC, disclosed in its schedules of assets and
liabilities, amended on July 3, 2012, that it had $4.3 billion in
assets composed of $9.7 million in real property and $4.3 billion
in personal property and $2.5 billion in liabilities composed of
$1.3 billion in secured claims, $1.02 million in unsecured
priority claims, and $1.2 billion in unsecured non-priority
claims. A copy of the Schedule is available for free at:
http://bankrupt.com/misc/gmac_july03sal.pdf
In its amended statement of financial affairs, dated July 19,
2012, GMAC disclosed payments made to creditors, including
insiders, during the 90-day period prior to the Petition Date. A
copy of the Statement is available for free at:
http://bankrupt.com/misc/gmac_july19sofa.pdf
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
ResCap is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and its legacy portfolio,
consisting mainly of mortgage loans and other residual financial
assets, to Ally Financial. Together, the asset sales are expected
to generate approximately $4 billion in proceeds.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Creditor Objects to Bradley Hiring
-------------------------------------------------------
Patrick J. Hopper objects to the request of Residential Capital to
employ Bradley Arant Boult Cummings LLP as special litigation and
compliance counsel.
As reported in the July 26, 2012 edition of the Troubled Company
Reporter, the Debtors have are seeking to employ Bradley Arant
Boult Cummings LLP as their special litigation and compliance
counsel, nunc pro tunc to May 14. The Debtors also ask the Court
to approve their alternative billing arrangement with BABC.
As Special Litigation and Compliance Counsel to the Debtors, BABC
is expected to continue to:
(a) represent the Debtors and/or the investors for which the
Debtors provide servicing or sub-servicing services in
existing or future litigation concerning claims related to
mortgage loans and related servicing practices brought by
borrower against the Debtors and/or such investors
primarily, but not exclusively, within the jurisdictions
of Alabama, Florida, Kentucky, Mississippi, North
Carolina, Oklahoma, South Carolina, Tennessee, and Texas;
(b) represent the Debtors and/or the investors for which the
Debtors provide servicing or sub-servicing services in
existing or future consumer and class action litigation
relating to the Debtors' mortgage servicing operations;
(c) advise the Debtors regarding the performance and
satisfaction of their obligations under and in compliance
with (i) the Board of Governors of the Federal Reserve
System Consent Order, dated April 13, 2011, by and among
AFI, Ally Bank, Residential Capital, LLC, GMAC Mortgage,
LLC, the Board of Governors of the Federal Reserve System,
and the Federal Deposit Insurance Corporation, (ii) the
consent judgment entered April 5, 2012 by the District
Court for the District of Columbia, dated February 9,
2012, and (iii) all related agreements with the Debtors
and their respective affiliates;
(d) advise the Debtors regarding compliance with various
federal, state, and local laws, statutes, regulations,
orders, and similar restrictions regarding the operation
of the Debtors' businesses and the performance of their
obligations under their servicing, sub-servicing, and
related contracts and agreements;
(e) counsel and otherwise advise and assist the Debtors in the
development, drafting, review, and revision of practices,
policies, and procedures relating to the operation of the
Debtors' businesses; and
(f) counsel and otherwise advise and assist the Debtors with
regard to research and review projects as needed and
directed by the Debtors in furtherance of the Debtors'
ongoing business operations.
With respect to the Prepetition Matters, the Debtors employed BABC
both on an hourly rate basis and pursuant to an alternative
billing arrangement. The Debtors seek to continue postpetition
these same employment and compensation arrangements with BABC.
The current hourly billing rates for BABC professionals expected
to spend a significant time on the Special Counsel Matters range
from $236 to $603 for partners, $184 to $341 for associates, and
$65 to $150 for paralegals. BABC customarily charges its clients
for reimbursable expenses incurred.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
ResCap is selling its mortgage origination and servicing
businesses to Nationstar Mortgage LLC, and its legacy portfolio,
consisting mainly of mortgage loans and other residual financial
assets, to Ally Financial. Together, the asset sales are expected
to generate approximately $4 billion in proceeds.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RG STEEL: Plants Fetch $25.15 Million at Auction
------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that RG Steel LLC selected:
-- the $5.15 million offer from Esmark Steel Group LLC as the
best bid for the facility in Yorkville, Ohio. Esmark
prevailed over Frontier Industrial Corp. at an auction on
July 31, RG said in a bankruptcy court filing;
-- the $20 million bid from Frontier Industrial as the
highest bid for the facility in Mingo Junction, Ohio.
Bloomberg News' Michael Bathon reports the company will sell
assets of its Wheeling Corrugating division to Nucor Corp. for
$7 million, according to court documents filed Aug. 1 in
Wilmington, Delaware. The Martins Ferry assets will be sold to W.
Quay Mull II and Joseph N. Gompers for $2 million. The steelmaker
will also sell its equity in Ohio Coatings Co. to Esmark Steel
Group LLC for $1.5 million, according to court papers.
There will be a hearing Aug. 8 in U.S. Bankruptcy Court in
Delaware for approval of the sales.
The Bloomberg report relates that auctions for the plants in
Sparrows Point, Maryland, and Warren, Ohio, were rescheduled to
take place Aug. 7. Assuming buyers offer acceptable prices, there
will be an Aug. 15 hearing to approve the sales.
According to Tribune Chronicle, the sale was originally slated for
last week but postponed until Aug. 7 due to the involvement of a
"stalking horse," or primary bidder. "The stalking horse bidding
process has been extended for an additional week for the Sparrows
Point plant and the Warren plant," Tribune Chronicle quotes Joe
Rosel, president of USW Local 9477 at Sparrows Point, as saying.
Tribune Chronicle says there were no bids for RG's Wheeling
headquarters or the remaining 50% of the Follansbee coke plant.
Lance Duroni at Bankruptcy Law360 reports that RG Steel has
secured buyers for a handful of minor assets worth a combined
$10.5 million.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owns Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012, to pursue a sale of the business. The
bankruptcy was precipitated by liquidity shortfall and a dispute
with Mountain State Carbon, LLC, and a Severstal affiliate, that
restricted the shipment of coke used in the steel production
process.
The Debtors estimated assets and debts in excess of $1 billion as
of the Chapter 11 filing. The Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors.
Conway MacKenzie, Inc., serves as the Debtors' financial advisor
and The Seaport Group serves as lead investment banker. Donald
MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson
Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
An official committee of unsecured creditors has been appointed in
the case. Kramer Levin Naftalis & Frankel LLP represents the
Committee. Huron Consulting Services LLC serves as its financial
advisor.
ROOMSTORE INC: Court OKs Lucy L. Thomson as Privacy Ombudsman
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia
authorized the reappointment of Lucy L. Thomson as consumer
privacy ombudsman in the Chapter 11 cases of Roomstore, Inc.
Ms. Thomson will serve as the CPO in connection with the proposed
sale of the Debtor's customer information pursuant to Section 332
of the Bankruptcy Code.
As reported in the Troubled Company Reporter on June 21, 2012,
W. Clarkson McDow, Jr., the U.S. Trustee for Region 4, has
determined after inquiry that Ms. Thomson is qualified to hold
this position and is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
As reported in the Troubled Company Reporter on May 21, 2012, the
Debtor obtained permission to appoint a consumer privacy ombudsman
in connection with its proposed sale of its customer information
for its stores within the state of Texas.
The Debtor is seeking to sell certain assets to Furniture Asset
Acquisition, LLC.
About RoomStore Inc.
With more than $300 million in net sales for its fiscal year
ending 2010, Richmond, Virginia-based RoomStore, Inc., was one of
the 30 largest furniture retailers in the United States.
RoomStore also offers its home furnishings through Furniture.com,
a provider of Internet-based sales opportunities for regional
furniture retailers.
RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case
No. 11-37790) on Dec. 12, 2011, following store-closing sales at
four of its retail stores, located in Hoover, Alabama;
Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore,
Maryland. At the time of the filing, the Company operated a chain
of 64 retail furniture stores, including both large-format stores
and clearance centers in eight states: Pennsylvania, Maryland,
Virginia, North Carolina, South Carolina, Florida, Alabama, and
Texas. It also had five warehouses and distribution centers
located in Maryland, North Carolina, and Texas that service the
Retail Stores.
RoomStore also owns 65% of Mattress Discounters Group LLC, which
operates 80 mattress stores (as of Nov. 30, 2011) in the states of
Delaware, Maryland and Virginia and in the District of Columbia.
RoomStore acquired the MDG stake after MDG's second bankruptcy in
2008. MDG sought Chapter 11 relief on Sept. 10, 2008 (Bankr. D.
Md. Case Nos. 08-21642 and 08-21644). It filed the first Chapter
11 bankruptcy on Oct. 23, 2002 (Bankr. D. Md. Case No. 02-22330),
and emerged on March 14, 2003.
Judge Douglas O. Tice, Jr., presides over RoomStore's case.
Lawyers at Lowenstein Sandler PC serve as the Debtor's bankruptcy
counsel. Kaplan & Frank, PLC, serves as local counsel. FTI
Consulting, Inc., serves as the Debtor's financial advisors and
consultants. American Legal Claims Services, LLC, serves as its
notice and claims agent. Lucy L. Thomson of Alexandria, Virginia,
was appointed as consumer privacy ombudsman.
RoomStore filed a plan of liquidation in June 2012 that provides
for the sale of inventory and remaining assets to generate
sufficient cash to pay secured and unsecured creditors in full.
RoomStore's balance sheet at Nov. 30, 2011, showed $59.57 million
in total assets, $57.75 million in total liabilities, and
stockholders' equity of $1.82 million. The Debtor disclosed
$44,624,007 in assets and $34,746,919 in liabilities as of the
Chapter 11 filing. The petition was signed by Stephen Girodano,
president and chief executive officer.
Liquidator Hilco Merchant Resources, Inc., is represented in the
case by Gregg M. Galardi, Esq., at DLA Piper LLP (US); and Robert
S. Westermann, Esq., and Sheila de la Cruz, Esq., at Hirschler
Fleischer, P.C.
The U.S. Trustee for Region 4 named seven members to the official
committee of unsecured creditors in the case. The Creditors
Committee tapped Hunton & Williams LLP as its counsel.
Judge Douglas Tice has agreed to convert the Chapter 11 bankruptcy
case of RoomStore Inc. to a Chapter 7 liquidation.
ROOMSTORE INC: Taps Binswanger Southern as Real Estate Broker
-------------------------------------------------------------
Roomstore, Inc., asks the U.S. Bankruptcy Court for the Eastern
District Of Virginia for permission to employ Binswanger Southern
(N.C.), Inc., as real estate broker for the sale or lease of the
Debtor's warehouse/distribution space located at 2208 Tanner Road,
Rocky Mount, North Carolina for a period of one year from
execution of the Exclusive Listing Agreement.
The Debtor agreed to compensate Binswanger a sale or lease
commission of 6% of the gross aggregate purchase price or 6% of
the gross aggregate rental for the term of any lease, and any
renewal or extension thereof, as the case may be, if the property
is sold or leased, or if a purchaser or tenant willing to buy or
lease on terms satisfactory to the Debtor is procured prior to the
termination of the agreement,
To the best of the Debtor's knowledge, Binswanger is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About RoomStore Inc.
With more than $300 million in net sales for its fiscal year
ending 2010, Richmond, Virginia-based RoomStore, Inc., was one of
the 30 largest furniture retailers in the United States.
RoomStore also offers its home furnishings through Furniture.com,
a provider of Internet-based sales opportunities for regional
furniture retailers.
RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case
No. 11-37790) on Dec. 12, 2011, following store-closing sales at
four of its retail stores, located in Hoover, Alabama;
Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore,
Maryland. At the time of the filing, the Company operated a chain
of 64 retail furniture stores, including both large-format stores
and clearance centers in eight states: Pennsylvania, Maryland,
Virginia, North Carolina, South Carolina, Florida, Alabama, and
Texas. It also had five warehouses and distribution centers
located in Maryland, North Carolina, and Texas that service the
Retail Stores.
RoomStore also owns 65% of Mattress Discounters Group LLC, which
operates 80 mattress stores (as of Nov. 30, 2011) in the states of
Delaware, Maryland and Virginia and in the District of Columbia.
RoomStore acquired the MDG stake after MDG's second bankruptcy in
2008. MDG sought Chapter 11 relief on Sept. 10, 2008 (Bankr. D.
Md. Case Nos. 08-21642 and 08-21644). It filed the first Chapter
11 bankruptcy on Oct. 23, 2002 (Bankr. D. Md. Case No. 02-22330),
and emerged on March 14, 2003.
Judge Douglas O. Tice, Jr., presides over RoomStore's case.
Lawyers at Lowenstein Sandler PC serve as the Debtor's bankruptcy
counsel. Kaplan & Frank, PLC, serves as local counsel. FTI
Consulting, Inc., serves as the Debtor's financial advisors and
consultants. American Legal Claims Services, LLC, serves as its
notice and claims agent. Lucy L. Thomson of Alexandria, Virginia,
was appointed as consumer privacy ombudsman.
RoomStore filed a plan of liquidation in June 2012 that provides
for the sale of inventory and remaining assets to generate
sufficient cash to pay secured and unsecured creditors in full.
RoomStore's balance sheet at Nov. 30, 2011, showed $59.57 million
in total assets, $57.75 million in total liabilities, and
stockholders' equity of $1.82 million. The Debtor disclosed
$44,624,007 in assets and $34,746,919 in liabilities as of the
Chapter 11 filing. The petition was signed by Stephen Girodano,
president and chief executive officer.
Liquidator Hilco Merchant Resources, Inc., is represented in the
case by Gregg M. Galardi, Esq., at DLA Piper LLP (US); and Robert
S. Westermann, Esq., and Sheila de la Cruz, Esq., at Hirschler
Fleischer, P.C.
The U.S. Trustee for Region 4 named seven members to the official
committee of unsecured creditors in the case. The Creditors
Committee tapped Hunton & Williams LLP as its counsel.
Judge Douglas Tice has agreed to convert the Chapter 11 bankruptcy
case of RoomStore Inc. to a Chapter 7 liquidation.
SAAB CARS: Spyker Seeks $3 Billion From General Motors
------------------------------------------------------
Katarina Gustafsson and Jeff Bennett at Dow Jones' Daily
Bankruptcy Review report that Spyker NV opened another chapter in
the ongoing saga surrounding Swedish auto maker Saab Automobile AB
by filing a lawsuit against General Motors Co., seeking $3 billion
in damages and accusing the Detroit car giant of forcing Saab into
bankruptcy protection last year.
About Saab Cars
More than 40 U.S.-based Saab dealerships have signed an
involuntary chapter 11 bankruptcy petition for Saab Cars North
America, Inc., (Bankr. D. Del. Case No. 12-10344) on Jan. 30,
2012. The petitioners, represented by Wilk Auslander LLP, assert
claims totaling $1.2 million on account of "unpaid warranty and
incentive reimbursement and related obligations" and/or "parts and
warranty reimbursement." Leonard A. Bellavia, Esq., at Bellavia
Gentile & Associates, in New York, signed the Chapter 11 petition
on behalf of the dealers.
The dealers want the vehicle inventory and the parts business to
be sold, free of liens from Ally Financial Inc. and Caterpillar
Inc., and "to have an appropriate forum to address the claims of
the dealers," Leonard A. Bellavia said in an e-mail to Bloomberg
News.
Saab Cars N.A. is the U.S. sales and distribution unit of Swedish
car maker Saab Automobile AB. Saab Cars N.A. named in December an
outside administrator, McTevia & Associates, to run the company as
part of a plan to avoid immediate liquidation following its parent
company's bankruptcy filing.
Saab Automobile AB is a Swedish car manufacturer owned by Dutch
automobile manufacturer Swedish Automobile NV, formerly Spyker
Cars NV. Saab Automobile AB, Saab Automobile Tools AB and Saab
Powertain AB filed for bankruptcy on Dec. 19, 2011, after running
out of cash.
SAAB CARS: PricewaterhouseCoopers LLP OK'd as Tax Accountants
-------------------------------------------------------------
The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for
the District of Delaware authorized SAAB Cars North America, Inc.,
to employ PricewaterhouseCoopers LLP, as tax accountants.
As reported in the Troubled Company Reporter on June 20, 2012, PwC
will provide tax accounting and compliance services:
-- preparation of U.S. Corporation Income Tax Return, Form
1120, for Debtors for the tax year beginning Jan. 1, 2011,
through Dec. 31, 2011, and any schedules or statements
required thereunder;
-- preparation of required state corporate income tax returns
for the tax year beginning Jan. 1, 2011, through Dec. 31,
2011, and any schedules or statements required thereunder;
and
-- completion of Schedule UTP, if applicable.
PwC may also provide additional services not specifically set
forth in the Engagement Letter, including providing advice or
assistance with respect to matters involving the Internal Revenue
Service or other tax authorities on an as-needed or as-requested
basis.
To the best of the Debtor's knowledge, PwC has no connection with,
and holds no interest adverse to, the Debtor or its estate in the
matters on which PwC is proposed to be engaged, except that (i)
prior to the commencement of the case, PwC rendered prepetition
services to the Debtor, (ii) PwC was paid $16,929 in fees in the
90-day period prior to the Commencement Date, and (iii) PwC has
rendered services, and may continue to render services, to certain
of the Debtor's creditors or other parties-in-interest in matters
wholly unrelated to the chapter 11 cases. Further, as of the
Commencement Date, PwC was owed $59,229 by the Debtor for fees for
services rendered. However, PwC waives any and all entitlement to
make a prepetition claim against the Debtor with respect to any
fees.
The hourly rates of PwC's personnel are:
Partner $540
Director $342
Manager $266
Senior Associate $202
Associate $135
Administrative $81
Subject to the Engagement Letter, PwC estimates that the fee range
for the preparation and filing of the 2011 federal return will be
$49,500 and the fee range for the preparation and filing of 35
2011 state returns will be $90,000.
About Saab Cars N.A.
More than 40 U.S.-based Saab dealerships have signed an
involuntary chapter 11 bankruptcy petition for Saab Cars North
America, Inc., (Bankr. D. Del. Case No. 12-10344) on Jan. 30,
2012. The petitioners, represented by Wilk Auslander LLP, assert
claims totaling $1.2 million on account of "unpaid warranty and
incentive reimbursement and related obligations" and/or "parts and
warranty reimbursement." Leonard A. Bellavia, Esq., at Bellavia
Gentile & Associates, in New York, signed the Chapter 11 petition
on behalf of the dealers.
Donlin, Recano & Company, Inc. (DRC), has been retained to provide
claims and noticing agent services to Saab Cars North America,
Inc. in its Chapter 11 case.
The dealers want the vehicle inventory and the parts business to
be sold, free of liens from Ally Financial Inc. and Caterpillar
Inc., and "to have an appropriate forum to address the claims of
the dealers," Leonard A. Bellavia said in an e-mail to Bloomberg
News.
Saab Cars N.A. is the U.S. sales and distribution unit of Swedish
car maker Saab Automobile AB. Saab Cars N.A. named in December an
outside administrator, McTevia & Associates, to run the company as
part of a plan to avoid immediate liquidation following its parent
company's bankruptcy filing.
Saab Automobile AB is a Swedish car manufacturer owned by Dutch
automobile manufacturer Swedish Automobile NV, formerly Spyker
Cars NV. Saab Automobile AB, Saab Automobile Tools AB and Saab
Powertain AB filed for bankruptcy on Dec. 19, 2011, after running
out of cash.
On Feb. 24, 2012, the Court, inconsideration of the petition filed
on Jan. 30, 2012, granted Saab Cars North America, Inc., relief
under Chapter 11 of the Bankruptcy Code.
On March 9, 2012, the U.S. Trustee formed an official Committee of
Unsecured Creditors and appointed these members: Peter Mueller
Inc., IFS Vehicle Distributors, Countryside Volkwagen, Saab of
North Olmstead, Saab of Bedford, Whitcomb Motors Inc., and
Delaware Motor Sales, Inc. The Committee tapped Wilk Auslander
LLP as general bankruptcy counsel, and Polsinelli Shughart as its
Delaware counsel.
SAAB CARS: Creditors Have Until Sept. 14 to File Proofs of Claim
----------------------------------------------------------------
The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for
the District of Delaware established Sept. 14, 2012, at 5 p.m.
(Eastern Time) as the deadline for all governmental units; non-
governmental entities and parties-in-interest to file proofs of
claim against SAAB Cars North America, Inc.,
Proofs of claim must be filed:
if by mail:
Donlin Recano & Company, Inc.
Re: Saab Cars North America, Inc.
P.O. Box 2019
Murray Hill Station
New York, NY 10156
if by delivery by hand, courier service or overnight service:
Donlin Recano & Company, Inc.
Re: Saab Cars North America, Inc.
419 Park Avenue South, Suite 1206
New York, NY 10016
About Saab Cars N.A.
More than 40 U.S.-based Saab dealerships have signed an
involuntary chapter 11 bankruptcy petition for Saab Cars North
America, Inc., (Bankr. D. Del. Case No. 12-10344) on Jan. 30,
2012. The petitioners, represented by Wilk Auslander LLP, assert
claims totaling $1.2 million on account of "unpaid warranty and
incentive reimbursement and related obligations" and/or "parts and
warranty reimbursement." Leonard A. Bellavia, Esq., at Bellavia
Gentile & Associates, in New York, signed the Chapter 11 petition
on behalf of the dealers.
Donlin, Recano & Company, Inc. (DRC), has been retained to provide
claims and noticing agent services to Saab Cars North America,
Inc. in its Chapter 11 case.
The dealers want the vehicle inventory and the parts business to
be sold, free of liens from Ally Financial Inc. and Caterpillar
Inc., and "to have an appropriate forum to address the claims of
the dealers," Leonard A. Bellavia said in an e-mail to Bloomberg
News.
Saab Cars N.A. is the U.S. sales and distribution unit of Swedish
car maker Saab Automobile AB. Saab Cars N.A. named in December an
outside administrator, McTevia & Associates, to run the company as
part of a plan to avoid immediate liquidation following its parent
company's bankruptcy filing.
Saab Automobile AB is a Swedish car manufacturer owned by Dutch
automobile manufacturer Swedish Automobile NV, formerly Spyker
Cars NV. Saab Automobile AB, Saab Automobile Tools AB and Saab
Powertain AB filed for bankruptcy on Dec. 19, 2011, after running
out of cash.
On Feb. 24, 2012, the Court, inconsideration of the petition filed
on Jan. 30, 2012, granted Saab Cars North America, Inc., relief
under Chapter 11 of the Bankruptcy Code.
On March 9, 2012, the U.S. Trustee formed an official Committee of
Unsecured Creditors and appointed these members: Peter Mueller
Inc., IFS Vehicle Distributors, Countryside Volkwagen, Saab of
North Olmstead, Saab of Bedford, Whitcomb Motors Inc., and
Delaware Motor Sales, Inc. The Committee tapped Wilk Auslander
LLP as general bankruptcy counsel, and Polsinelli Shughart as its
Delaware counsel.
SABRE HOLDINGS: S&P Rates New $250-Mil. Term Loan at 'B'
--------------------------------------------------------
Standard & Poor's Ratings Services assigned its issue-level rating
of 'B' (the same as the corporate credit rating) and a recovery
rating of '3' to Southlake, Tex.-based Sabre Holdings Corp.'s
proposed $250 million term loan due Dec. 29, 2017. "The '3'
recovery rating indicates our expectation of meaningful (50%-70%)
recovery in the events of a payment default. These are the same as
our existing senior secured issue and recovery ratings on other
debt issues. Proceeds from the proposed loan will be used to repay
2014 maturity," S&P said.
"Our 'B' rating on the company incorporates our assumption of
stable operating performance, despite the company's ongoing
dispute with one of its airline corporate customers, and
competitive pressure at its online travel agency, Travelocity. We
expect that growth in the travel market will more than offset the
weakness at Travelocity. Based on preliminary results, Sabre
posted healthy EBITDA growth in the second quarter from increased
travel transaction and passengers boarded. We estimate that
Sabre's debt leverage was in the mid-5x area as of June 30, 2012.
We expect that debt leverage will decrease to around 5x by the end
of 2012 with decent conversion of EBITDA to discretionary cash
flow," S&P said.
RATINGS LIST
Sabre Holdings Corp.
Sabre Inc.
Corporate credit rating B/Positive/--
Rating Assigned
Sabre Inc.
$250 mil. term loan due 2017 B
Recovery rating 3
SABRE INC: Moody's Rates $250-Mil. First Lien Term Loan 'B1'
------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to a new $250
million first lien term loan due 2017 offered by Sabre, Inc., a
wholly-owned subsidiary of Sabre Holdings Corporation ("Sabre").
No other ratings were impacted, including Sabre's B2 Corporate
Family Rating ("CFR") and stable ratings outlook.
Proceeds from the new term loan will be used to repay a portion of
Sabre's $1 billion term loan due September 2014.
Rating assigned (and Loss Given Default assessment) to Sabre, Inc:
-- Proposed $250 million first lien term loan due December 2017,
B1 (LGD 3, 41%)
Existing ratings (and Loss Given Default assessments):
-- Corporate Family Rating, B2
-- Probability of Default Rating, B2
-- $216 million Sabre, Inc. first lien revolver due March 2013,
B1 (LGD 3, 41%)
-- $284 million Sabre, Inc. first lien revolver due September
2016, B1 (LGD 3, 41%)
-- $1.0 billion Sabre, Inc. first lien term loan due September
2014, B1 (LGD 3, 41%)
-- $1.2 billion Sabre, Inc. first lien term loan due September
2017, B1 (LGD 3, 41%)
-- $405 million Sabre, Inc. first lien term loan due December
2017, B1 (LGD 3, 41%)
-- $400 million Sabre Holdings senior unsecured notes due March
2016, Caa1 (LGD 6, 92%)
-- $400 million Sabre, Inc. first lien notes due 2019, B1 (LGD
3, 41%)
Ratings Rationale
The refinancing is leverage-neutral and improves Sabre's debt
maturity wall, but interest expense and cash flow will be modestly
impacted from higher interest rates. The company has improved its
financial leverage (debt / EBITDA) to 5.3 times through steady
debt reduction and earnings growth, and Moody's anticipates that
leverage will fall below 5 times over the next 12-18 months.
Sabre's B2 CFR reflects uncertainty regarding the global
distribution system ("GDS") business model in light of disputes
with certain airlines seeking to reduce distribution costs.
Although Sabre's GDS segment continues to grow volumes, an
unfavorable legal outcome could shift air travel bookings to a
direct supply model from the airlines over time, or lead to
pricing concessions. Nonetheless, Sabre's software and services
are entrenched in the processes and systems of online and
traditional travel agencies and provide efficiencies and pricing
transparency that consumers demand. Travelocity, Sabre's online
travel agency, continues to underperform compared to peers but
this segment represents just 10% of consolidated earnings.
Shortfalls have been mitigated by organic revenue growth in the
software-as-a-service and GDS segments, which are larger
contributors to profitability.
The stable outlook reflects Moody's expectation that consolidated
revenues will grow 3-5% annually over the next 12-18 months,
driven primarily by organic expansion in the airline and hotel
software-as-a-service segment. The ratings could be downgraded if
the remaining 2014 debt maturities are not refinanced or extended
in a timely manner. The ratings could also be lowered if volumes
or pricing come under stress from the loss of significant
customers or due to anticipated shifts in the distribution of
travel supply throughout the industry, or if financial leverage is
sustained above 6 times. The ratings could be upgraded if Sabre
were to favorably resolve the anti-trust lawsuits by American
Airlines and U.S. Airways and the investigation by the DOJ,
successfully renew its major supplier contracts, demonstrate
organic revenue and earnings growth, improve its liquidity
profile, and reduce debt so that financial leverage could be
sustained below 5.5 times during a cyclical downturn.
The principal methodology used in rating Sabre 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.
Headquartered in Southlake, Texas, Sabre owns one of the three
largest global distribution systems, a leading software-as-a-
service business that provides technology solutions to travel
suppliers globally, and an online travel agency (Travelocity).
Sabre is owned by TPG Partners, Silver Lake Partners and other co-
investors. Annual revenues approximate $3 billion.
SAND TECHNOLOGY: Incurs C$1.3MM Net Loss in Q3 Fiscal 2012
----------------------------------------------------------
SAND Technology Inc. reported a net loss and comprehensive loss of
C$1.30 million on C$889,143 of revenue for the three months ended
April 30, 2012, compared with a net loss and comprehensive loss of
C$1.36 million on C$780,909 of revenue for the same period during
the prior year.
The Company reported net income and comprehensive income of C$4.14
million on C$2.18 million of revenue for the nine months ended
April 30, 2012, compared with a net loss and comprehensive loss of
C$1.33 million on C$4.10 million of revenue for the same period a
year ago.
The Company's balance sheet at April 30, 2012, showed C$5.27
million in total assets, C$4.15 million in total liabilities and
C$1.12 million in shareholders' equity.
As previously announced, the Corporation's board of directors and
management team initiated a review of the business, including
consideration of all available strategic options, with the
objective of maximizing value for shareholders. There can be no
assurance, however, that the strategic review will result in any
specific transaction.
A copy of the Form 6-K filing is available for free at
http://is.gd/bCcAzD
About SAND Technology
Westmount, Quebec-based SAND Technology Inc. (OTC BB: SNDTF)
-- http://www.sand.com/-- provides Data Management Software and
Best Practices for storing, accessing, and analyzing large amounts
of data on-demand while lowering TCO, leveraging existing
infrastructure and improving operational performance.
SAND/DNA solutions include CRM analytics, and specialized
applications for government, healthcare, financial services,
telecommunications, retail, transportation, and other business
sectors. SAND Technology has offices in the United States,
Canada, the United Kingdom and Central Europe.
The Company reported a net loss and comprehensive loss of C$2.11
million on C$6.87 million of revenue for the fiscal year ended
July 31, 2011, compared with a net loss and comprehensive loss of
$745,549 on $6.56 million of revenue during the prior year.
SANDRIDGE ENERGY: Moody's Upgrades CFR to 'B1'; Outlook Stable
--------------------------------------------------------------
Moody's Investors Service upgraded SandRidge Energy Inc.'s
Corporate Family Rating (CFR) to B1 and it senior unsecured note
rating to B2. This action concludes the ratings review that was
initiated on April 2, 2012. Moody's assigned a B2 rating to the
company's new $750 million senior unsecured note offering. The
proceeds of the new notes are expected to be used to refinance the
company's $350 million of senior floating rate notes with the
remainder used to support SandRidge's capital expenditure program
in 2012 and 2013. Moody's also assigned a SGL-3 Speculative Grade
Liquidity rating. The outlook is stable.
"SandRidge's leveraged financial position and aggressive financial
policies constrain the company's rating," said Stuart Miller,
Moody's Senior Credit Officer. "If not for the elevated leverage
level, the scale of the SandRidge's operations, and its growth
profile, could support a higher ratings level."
Ratings Rationale
The B1 CFR and stable outlook reflect SandRidge's large size and
scale relative to its peers, the increasing percentage of oil
reserves and production, its high leverage level, and the
significant out-spending of internally generated cash flow
expected for at least the next two to three years. The magnitude
of the company's proved developed reserve base and average daily
production rate are comparable to Ba rated companies. However,
SandRidge's debt to daily average production is around $46,000 per
BOE and the ratio of debt to proved developed reserves is about
$15 per BOE pro forma for the Dynamic Offshore Resources
acquisition that closed in April of 2012. These leverage metrics
are more comparable to Caa rated companies and act as a constraint
on the company's debt rating. Moody's B1 CFR prospectively assumes
that SandRidge will grow production and cash flow by 20 to 30% per
year while maintaining leverage near its current levels. Moody's
believes this is a reasonable assumption given the quality of
SandRidge's asset base and its recent drilling results in the
Mississippian Lime and the Permian Basin.
The B2 rating on the senior unsecured notes reflects both the
overall probability of default of SandRidge, to which Moody's
assigns a PDR of B1, and a loss given default of LGD4 (60%).
SandRidge's senior unsecured debt is junior to the company's $1.75
billion senior secured credit facility which has a borrowing base
of approximately $900 million. Because of the junior position of
the senior unsecured notes in the capital structure, Moody's rates
them one notch below the B1 CFR, consistent with Moody's Loss
Given Default methodology.
Moody's SGL-3 Speculative Grade Liquidity rating reflects adequate
liquidity over the next 12 to 18 months. Moody's projects $1.2
billion of negative free cash flow annually which is the result of
a capital spending program that is in the order of $2 billion,
most of which is discretionary or deferrable. Including the
proceeds from the new bond offering, SandRidge will have
approximately $800 million of cash and about $900 million of
borrowing base availability under its $1.75 billion senior secured
revolving credit facility to fund the expected out-spend of
internally generated cash flow. SandRidge's credit facility
matures in March 2017 and contains a net debt to EBITDAX ratio and
a current ratio. The covenants are not expected to impact
SandRidge's ability to borrow the full amount of the borrowing
base. However, to comply with the current ratio test in 2013 or
2014, Moody's expects that the company will need to either
monetize additional assets or go to the bond market to term out
credit facility borrowings. The credit agreement permits
significant latitude to transfer oil and gas assets to create
additional royalty trusts, an additional source of liquidity for
SandRidge.
The rating outlook is stable. Given the upgrade to B1, a positive
rating action is unlikely in the near future unless there is a
substantial reduction in leverage to at least $35,000 per BOE of
debt to average daily production, a reduction of debt to proved
developed reserves to less than $12, and the ratio of retained
cash flow (RCF) to debt is greater than 25%. All of these ratios
are more in line with Ba3 companies. An increase in the ratio of
debt to average daily production above $50,000 per BOE, debt to
proved developed reserves above $15.00 per BOE, or RCF to debt of
less than 10% could lead to a negative rating action.
The principal methodology used in rating SandRidge Energy, Inc.
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.
SandRidge Energy, Inc. is a mid-sized independent oil and gas
exploration and production company headquartered in Oklahoma City,
Oklahoma. After the April 2012 acquisition of Dynamic Offshore
Resources, LLC, SandRidge had proved developed reserves estimated
at 281 million BOE and average daily production of about 90,000
BOE per day.
SANDRIDGE ENERGY: S&P Rates New $500-Mil. Note Offering 'B'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned issue-level and
recovery ratings to SandRidge Energy Inc.'s planned senior
unsecured $500 million note offering. "We rated the senior
unsecured notes 'B' (same as the corporate credit rating) and
assigned a '4' recovery rating to the notes, indicating our
expectation of average (30% to 50%) recovery for lenders in the
event of a default. SandRidge also plans to issue a $250 million
tack-on to the company's existing senior unsecured notes rated 'B'
due 2021," S&P said.
"The company plans to use proceeds from the notes to fund the
tender of its $350 million floating rate notes due 2014, and to
fund a portion of 2013 capital spending. Pro forma for the new
issuance and refinancing, SandRidge has about $3.9 billion of
funded debt," S&P said.
"The ratings on Oklahoma City-based SandRidge Energy reflect our
view of the company's 'weak' business risk and 'highly leveraged'
financial risk, incorporating an aggressive growth strategy
demonstrated by capital spending well in excess of internally
generated cash flow and by acquisitions. The ratings also reflect
the company's strategic shift to increase oil production from
natural gas in response to weak near-term natural gas prices and
toward greater geographic diversity," S&P said.
RATINGS LIST
SandRidge Energy Inc.
Corporate credit rating B/Stable/--
New Ratings
Planned $500 mil sr unsecd nts B
Recovery rating 4
SANUWAVE HEALTH: Had $1.8 Million Net Loss in First Quarter
-----------------------------------------------------------
SANUWAVE Health, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $1.83 million on $238,540 of revenues for
the three months ended March 31, 2012, compared with a net loss of
$2.18 million on $251,753 of revenues for the same period last
year.
The Company's balance sheet at March 31, 2012, showed
$4.59 million in total assets, $7.69 million in total liabilities,
and a stockholders' deficit of $3.10 million.
BDO USA, LLP, in Atlanta, Georgia, expressed substantial doubt
about SANUWAVE's ability to continue as a going concern, following
the Company's results for the fiscal year ended Dec. 31, 2011.
The independent auditors noted that the Company has suffered
recurring losses from operations and is economically dependent
upon future issuances of equity or other financing to fund ongoing
operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/RgDzL5
Alpharetta, Ga.-based SANUWAVE Health, Inc., is an emerging global
regenerative medicine company focused on the development and
commercialization of noninvasive, biological response activating
devices for the repair and regeneration of tissue, musculoskeletal
and vascular structures.
SHENGDATECH INC: Aug. 30 Hearing on More Plan Exclusivity
---------------------------------------------------------
BankruptcyData.com reports that ShengdaTech filed with the U.S.
Bankruptcy Court a fourth motion for an order extending the
exclusive period during which the Debtors can file a Chapter 11
plan and solicit acceptances thereof through and including
December 17, 2012 and March 11, 2013 respectively.
The Court scheduled an August 30, 2012 hearing on the matter.
About ShengdaTech
Headquartered in Shanghai, China, ShengdaTech, Inc., makes nano
precipitated calcium carbonate for the tire industry.
ShengdaTech converts limestone into nano-precipitated calcium
carbonate (NPCC) using its proprietary and patent-protected
technology. NPCC products are increasingly used in tires, paper,
paints, building materials, and other chemical products. In
addition to its broad customer base in China, the Company
currently exports to Singapore, Thailand, South Korea, Malaysia,
India, Latvia and Italy.
ShengdaTech sought Chapter 11 bankruptcy protection from
creditors (Bankr. D. Nev. Case No. 11-52649) on Aug. 19, 2011, in
Reno, Nevada, in the United States.
The Shanghai-China based company said in its bankruptcy filing it
would fire all of its officers and restructure to try to recover
from an accounting scandal.
The Company disclosed US$295.4 million in assets and US$180.9
million in debt as of Sept. 30, 2011.
The Company's legal representative in its Chapter 11 case is
Greenberg Traurig, LLP. On Aug. 23, 2011, the Court entered an
interim order confirming the Board of Directors Special
Committee's appointment of Michael Kang as the Debtor's chief
restructuring officer.
Alvarez & Marsal North America, LLC, is the Company's chief
restructuring officer.
As reported in by the Troubled Company Reporter on Sept. 7, 2011,
the United States Trustee appointed AG Ofcon, LLC, The Bank of
New York, Mellon (in its role as indenture trustee for
bondholders), and Zazove Associates, LLC, to serve on the
Official Committee of Unsecured Creditors of ShengdaTech, Inc.
Hogan Lovells US serves as counsel for ShengdaTech's official
committee of unsecured creditors.
The Plan provides for the wind-down of the Debtor's affairs and
the Distribution of the Debtor's remaining assets to Creditors.
SHOE MANIA: Creditors Seek to Force Retailer into Chapter 7
-----------------------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle, reports that creditors of Shoe Mania LLC
with a total of $3.4 million in claims filed court papers seeking
to force the Manhattan retailer to bankruptcy.
Clarks Cos., Cole Haan, New Balance Athletic Shoe Inc., Puma North
America Inc., Earth Inc., VF Outdoor Inc., Mephisto Inc.,
Allrounder Inc., Skechers USA and Converse Inc. filed an
involuntary Chapter 7 petition against Shoe Mania in U.S.
Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 12-13323)
on Aug. 3.
According to the report, Shoe Mania has failed "to pay its debts
owed to the petitioning creditors as such debts became due,"
Lawrence Gottlieb, Esq., an attorney for the creditors, said in
court papers.
Bank Leumi USA sued Shoe Mania on July 24 in New York State
Supreme Court claiming the company shut all three of its Manhattan
stores earlier that month and moved the inventory without
notifying the lender. The case is Bank Leumi USA v. Shoe Mania
Holding Inc., 652551/2012, New York Supreme Court, New York.
The Bloomberg report discloses Shoe Mania's creditors asked the
bankruptcy court to appoint an interim trustee "to preserve the
property of the estates or to prevent loss to the estates."
They also filed petitions to force Shoe Mania Holding Inc. and
Shoe Mania V LLC into bankruptcy. Puma is the largest petitioning
creditor, with a claim of $1.2 million.
SINCLAIR BROADCAST: Reports $30.1 Million Net Income in Q2
----------------------------------------------------------
Sinclair Broadcast Group, Inc., reported net income of
$30.13 million on $253.55 million of total revenues for the three
months ended June 30, 2012, compared with net income of $18.47
million on $188.86 million of total revenues for the same period
during the prior year.
For the six months ended June 30, 2012, the Company reported net
income of $59.20 million on $477.39 million of total revenues, as
compared to net income of $33.60 million on $371.46 million of
total revenue for the same period a year ago.
The Company's balance sheet at June 30, 2012, showed $2.16 billion
in total assets, $2.22 billion in total liabilities and a $66.28
million total stockholders' deficit.
"Second quarter results were excellent, as political advertising
spending in the quarter was almost triple our expectations,"
commented David Smith, President and CEO of Sinclair. "Despite
the markets' concern about the global economy, our core revenues
on a same station basis grew 4.6%."
"We continue to position the Company for long term growth as we
take advantage of what we believe to be under-valued assets
relative to historic public equity multiples. In the second
quarter, we closed on the acquisition of the Freedom
Communications television stations and recently announced the
acquisition of six of the Newport Television stations. To date,
we have announced approximately $1 billion in total assets
acquired or to be acquired projected to represent almost $150
million of incremental blended cash flow. In addition, we were
able to renew our FOX affiliation agreements seven months early,
thereby removing any uncertainty regarding our on-going
relationship with the network and securing our affiliation in our
flagship market."
A copy of the press release is available for free at:
http://is.gd/0gk4He
About Sinclair Broadcast
Based in Baltimore, Maryland, Sinclair Broadcast Group, Inc.
(Nasdaq: SBGI) -- http://www.sbgi.net/-- one of the largest and
most diversified television broadcasting companies, currently owns
and operates, programs or provides sales services to 58 television
stations in 35 markets. The Company's television group reaches
roughly 22% of U.S. television households and includes FOX,
ABC, CBS, NBC, MNT, and CW affiliates.
The Company said in the Form 10-Q for the quarter ended March 31,
2012, that any insolvency or bankruptcy proceeding relating to
Cunningham, one of its LMA partners, would cause a default and
potential acceleration under a Bank Credit Agreement and could,
potentially, result in Cunningham's rejection of the Company's
seven LMAs with Cunningham, which would negatively affect the
Company's financial condition and results of operations.
* * *
As reported by the TCR on Feb. 24, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on Hunt Valley, Md.-
based TV broadcaster Sinclair Broadcast Group Inc. to 'BB-' from
'B+'. The rating outlook is stable. "The 'BB-' rating on
Sinclair reflects S&P's expectation that the company could keep
its lease-adjusted debt to EBITDA below historical levels
throughout the election cycle, absent a reversal of economic
growth, meaningful debt-financed acquisitions, or significant
shareholder-favoring measures," explained Standard & Poor's credit
analyst Deborah Kinzer.
In September 2010, Moody's raised its ratings for Sinclair
Broadcast and subsidiary Sinclair Television Group, Inc.,
including the Corporate Family Rating and Probability-of-Default
Rating, each to Ba3 from B1, and the ratings for individual debt
instruments. Moody's also assigned a B2 (LGD 5, 87%) rating to
the proposed $250 million issuance of Senior Unsecured Notes due
2018 by STG. The Speculative Grade Liquidity Rating remains
unchanged at SGL-2. The rating outlook is now stable.
SKINNER ENGINE: Plan May Be Nixed Before Confirmation Hearing
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that the U.S. Court of Appeals in Philadelphia ruled on July 25
that if "it's obvious that the plan is patently unconfirmable," a
bankruptcy judge is entitled to convert the case from Chapter 11
reorganization to a Chapter 7 liquidation at a hearing for
approval of a disclosure statement explaining a proposed
reorganization plan.
Steven Schwartz, writing a summary of the opinion for ABI VOLO,
recounts that Skinner, founded in 1868, manufactured ships and
ship parts. Skinner's parts and ships made between 1930 and 1970
allegedly contained asbestos. Pursuant to insurance coverage
agreements, insurers defended asbestos claims against the insured,
Skinner. Skinner filed bankruptcy because of cash-flow problems,
not because of mass-tort litigation claims against it.
According to Mr. Schwartz, insurers contended that Skinner's
Chapter 11 plans were filed in bad faith and parties collusively
attempted to get money from the insurers to pay creditors and
bankruptcy professionals, rather than asbestos claimants. The
plan called for a surcharge of 20% to be paid by Asbestos
Claimants who opted in to the plan's settlement process through a
process called the "Court Approved Distribution Procedures"
("CADP"). CADP and the 20% surcharge were non-negotiable facets of
the plan, according to the plan proponents.
Skinner filed numerous Chapter 11 plans. The Bankruptcy Court
held that the fifth iteration of Skinner's Chapter 11 plan was
patently unconfirmable pursuant to 1129(a)(3) & (a)(11), and
therefore converted the case to a Chapter 7 pursuant to 1112(b).
Skinner appealed to the Western District of Pennsylvania, before
Judge Gary Lancaster, who affirmed the Bankruptcy Court's order.
Skinner appealed to the Third Circuit.
Mr. Rochelle relates that the opinion by Circuit Judge D. Michael
Fisher evidently makes the 3rd Circuit the first federal circuit
court to rule that a bankruptcy judge can refuse confirmation of
plan even before holding a confirmation hearing.
The report relates that on the merits, Judge Fisher said the plan
wasn't feasible and couldn't be confirmed because the financial
underpinning for the plan was "highly speculative" and based on
"wholly speculative litigation proceeds." according to the report.
Judge Fisher also concluded that the plan wasn't proposed in good
faith because it was based on an "inherent conflict of interest"
where the company would be "incentivized to sabotage its own
defense" against asbestos claims.
The case is In re American Capital Equipment LLC, 10-2239,
U.S. 3rd Circuit Court of Appeals (Philadelphia)
About Skinner
Skinner Engine Company, Inc., one of Erie, Pa.'s oldest industrial
companies, and American Capital Equipment, Inc., filed for chapter
11 protection (Bankr. W.D. Pa. Case Nos. 01-23987 and 01-23988) in
2001. The Bankruptcy Court denied confirmation of the Companies'
Fifth Amended Plan on May 26, 2009, and the cases will be
converted to Chapter 7 liquidation proceedings.
SOLYNDRA LLC: GOP Report Slams White House Over $535MM Loan
-----------------------------------------------------------
Derek Hawkins at Bankruptcy Law360 reports that House Republicans
unveiled their final report Thursday on the $535 million loan
guarantee the Obama administration issued to now-bankrupt solar
manufacturer Solyndra LLC, concluding officials broke the law
during the loan's restructuring and arguing the company never
should have received federal assistance.
"Solyndra should stand as a cautionary tale of what happens when
an administration ties itself to a project so closely that it
becomes the poster child of its signature economic policy,"
Republicans said in the report obtained by Bankruptcy Law360.
About Solyndra LLC
Founded in 2005, Solyndra LLC was 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.
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.
The Official Committee of Unsecured Creditors of Solyndra LLC has
tapped Blank Rome LLP as counsel and BDO Consulting as financial
advisors.
In October 2011, the Debtors hired Berkeley Research Group, LLC,
and designated R. Todd Neilson as Chief Restructuring Officer.
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.
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.
When they filed for Chapter 11, the Debtors pursued 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 were unable to identify any potential
buyers, an orderly liquidation of the assets for the benefit of
their creditors.
Solyndra did not receive acceptable offers to buy the business as
a going concern. Two auctions late last year brought in a total
of $8 million. A three-day auction in February generated another
$3.8 million. An auction in June generated $1.79 million from the
sale of 7,200 lots of equipment.
SPRING NEXTEL: Fitch Affirms Low-B IDR; Outlook Negative
--------------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Rating (IDR) and
long-term debt ratings of Sprint Nextel Corporation and its
subsidiaries. The Rating Outlook for Sprint Nextel and its
subsidiaries is Negative.
The ratings for Sprint reflect the ongoing execution risk both
operationally and financially regarding several key initiatives
that the company expects will improve cash generation, network
performance and longer-term profitability. Risks include
achieving expected cost benefits associated with its network
modernization, improving its competitive position with its 4G
deployment, maintaining postpaid CDMA subscriber trends, improving
iPhone dilution rates and retaining its Integrated Digital
Enhanced Network (iDEN) subscribers.
Second quarter results show the company has generally managed
these risks with improved CDMA churn, strong ARPU growth, better
than expected iDEN subscriber retention and accelerated iDEN
network shutdown. Consequently, Sprint Nextel materially
increased EBITDA guidance for 2012. However, execution risk and
cash burn rates will increase materially in the coming quarters as
Sprint advances on its multi-faceted plans. The company's
performance during the next two to three quarters will be a strong
indicator whether Sprint Nextel can successfully navigate these
risks, improve profitability and remain competitive.
Sprint Nextel has significantly fortified its liquidity position
and reduced medium-term refinancing risk since late 2011. The
past two debt issuances and vendor financed secured credit
agreement raised an additional $7 billion of financing. During
this time, Sprint has also repaid $3.25 billion of maturing debt.
The company's liquidity at the end of the second quarter 2012 was
approximately $8 billion, including $6.8 billion in cash. In
addition, up to $500 million is available through May 31, 2013
under the first tranche of the secured equipment credit facility.
The current liquidity helps address Sprint Nextel's material cash
requirements expected through at least 2013 which could be in
excess of $5 billion due primarily to the network modernization
project and iPhone rollout.
Sprint's $2.24 billion unsecured revolving credit facility expires
in October 2013. Sprint negotiated an amendment to the credit
facility to give it cushion relief into 2013, due to iPhone-
related losses. The leverage ratio for the covenant is currently
4.25x and will reduce to 4x beginning in January 2013. As of June
30, 2012, the ratio was 3.4 to 1.0 as compared to 3.7 to 1.0 as of
Dec. 31, 2011.
Sprint still has sizeable maturities during the next three years
totaling approximately $4.8 billion. Maturities include
approximately $800 million in 2013, $1.4 billion in 2014 and $2.6
billion in 2015. Fitch expects the company will opportunistically
seek debt refinancing to reduce maturity risk going forward.
Sprint Nextel will also likely need to consider parameters for a
new facility by the end of 2012 given the 2013 maturity.
The Sprint Nextel credit agreement allows sizeable carve-outs for
additional senior indebtedness. The carve-outs include unsecured
junior guaranteed indebtedness that is subordinated in right of
subsidiary guarantees to the credit facilities not to exceed $4
billion. Between the last two debt offerings, Sprint has now
issued $4 billion in junior guaranteed debt. The unsecured junior
guaranteed debt is senior to the unsecured notes at Sprint Nextel,
Sprint Capital Corporation and Nextel Communications Inc. The
unsecured senior notes at these entities are not supported by an
upstream guarantee from the operating subsidiaries.
The credit agreement additionally allows capacity for unsecured
senior guaranteed indebtedness of $2 billion. This debt would
benefit from the same guarantee and rank equally in right of
payment to the unsecured credit facilities.
Sprint Nextel has indicated potential plans for an additional $1
billion to $2 billion of secured vendor financing. Fitch expects
this would be similar in nature to the $1 billion secured credit
agreement reached at the end of May 2012. The borrowers under the
existing credit agreement are all of the material Sprint Nextel
subsidiaries that currently guarantee Sprint Nextel's revolving
credit facility and junior guaranteed notes.
Within the past three quarters, Sprint has placed $5 billion of
debt including the $1 billion vendor financed secured credit
agreement that is senior to the senior unsecured notes (no
upstream guarantee) at Sprint Nextel Corp and Sprint Capital Corp.
and Nextel Communications Inc. (NCI). Consequently this has
diminished recovery prospects for the unsecured notes to the low
end of the range for the RR4 recovery level. Fitch believes that
any further secured vendor financing would cause a one notch
downgrade of the unsecured (no upstream guarantee) debt at Sprint
Nextel Corp and Sprint Capital Corp. due to reduced recovery
support. Currently some uncertainty exists as to the timing, the
amount and whether Sprint Nextel will reach an agreement for
additional vendor financing.
Fitch acknowledges the preferred position structurally of NCI
bondholders versus the unsecured (no upstream guarantee)
bondholders at Sprint Nextel Corp. and Sprint Capital Corporation.
This difference has become more pronounced with the increasing
complexity of more senior debt in Sprint Nextel's capital
structure. The NCI bondholders are supported primarily by the
value resident in the spectrum licenses held by Nextel operating
entities since the operating cash flows from Nextel operating
subsidiaries are becoming de minimis with a complete shutdown in
mid-2013.
Recovery distinctions between NCI bondholders and the unsecured
bondholders of Sprint Nextel Corp. and Sprint Capital Corp. are
difficult due to the uncertainty of whether that part of the
capital structure would face substantive consolidation or retain
its structural subordination. There is evidence that bankruptcy
proceedings use substantive consolidation when there has been
material flow of capital from one entity to another, which is
present in this scenario.
Notwithstanding, in the event Sprint Nextel layers in more secured
vendor financing which further diminishes recovery prospects for
the unsecured notes, it's likely Fitch will recognize that NCI
bondholders could experience enhanced recovery versus the rest of
the unsecured (no upstream guarantee) notes. Fitch expects Sprint
Nextel will continue paying down NCI debt first given the $3.8
billion in maturities the next three years.
The ratings have limited flexibility for execution missteps,
weakened core operational results, significantly higher cash
requirements, Clearwire event risk or lack of expected benefits
from the network modernization project. Fitch expects leverage
for Sprint Nextel to peak in the low 5x range during 2012. As a
result, Fitch will not remove the Negative Outlook during 2012. A
stabilization of the Outlook could occur by mid-2013 if Sprint
Nextel executes on stated objectives and the company demonstrates
further operational and financial improvements.
What Could Trigger A Rating Action
Negative: Future developments that may, individually or
collectively, lead to negative rating include:
-- Lack of expected cost benefits associated with network
modernization
-- iPhone dilution greater than expected
-- Postpaid Subscriber trends materially weaken
-- Cash requirements materially higher
-- iDEN subscriber retention
-- Clearwire event risk
-- Network upgrade delays and operating difficulties
-- Additional vendor financed debt leading to a downgrade of
unsecured issue ratings at Sprint Capital Corp. and Sprint
Nextel Corp.
Positive: The ratings have a Negative Rating Outlook. As a
result, Fitch's sensitivities do not currently anticipate
developments with a material likelihood, individually or
collectively, of leading to a rating upgrade.
Fitch affirms the ratings of Sprint Nextel and its subsidiaries as
follows:
Sprint Nextel Corporation;
-- Issuer default rating (IDR) at 'B+';
-- Senior Unsecured Credit Facility at 'BB/RR2';
-- Junior guaranteed unsecured notes at 'BB/RR2';
-- Senior Unsecured Notes at 'B+/RR4'.
Sprint Capital Corporation;
-- Issuer default rating (IDR) at 'B+';
-- Senior Unsecured Notes at 'B+/RR4'.
Nextel Communications Inc. (Nextel);
-- Issuer default rating (IDR) at 'B+';
-- Senior Unsecured Notes at 'B+/RR4'.
STAR TRIBUNE: Wayzata Takes Majority Stake
------------------------------------------
Kaitlin Ugolik at Bankruptcy Law360 reports that shareholders of
Star Tribune Co., which publishes the Minneapolis newspaper of the
same name, have agreed to a $4.1 million deal that will make
private equity firm Wayzata Investment Partners the majority owner
of the company, the paper said Friday.
Bankruptcy Law360 relates that the newspaper said that Wayzata
Investment would increase its minority interest of 49.8 percent to
a 58.2 percent stake, making the alternative investment firm the
first majority owner the Star Tribune has had since it emerged
from bankruptcy in 2009.
About Star Tribune
Headquartered in Minneapolis, Minnesota, The Star Tribune Company
-- http://www.startribune.com/-- operates the largest newspaper
in the state of Minnesota and published seven days each week in an
edition for the Minneapolis-Saint Paul metropolitan area.
The Company and its affiliate, Star Tribune Holdings Corporation,
filed for Chapter 11 protection on January 15, 2009 (Bankr.
S.D.N.Y. Lead Case No. 09-10244). Attorneys at Davis Polk &
Wardwell, represented the Debtors in their restructuring effort.
Blackstone Advisory Services L.P. served as financial advisor.
The Garden City Group, Inc., served as noticing and claims agent.
Attorneys at Lowenstein Sandler PC, represented the official
committee of unsecured creditors. In its bankruptcy petition,
Star Tribune listed assets and debts between $100 million and
$500 million each.
Judge Robert Drain at the U.S. Bankruptcy Court for the Southern
District of New York confirmed the company's plan of
reorganization, which was overwhelmingly supported by the
company's creditors, on September 17, 2009. Star Tribune emerged
from Chapter 11 on September 28, 2009.
According to Daily Bankruptcy Review, senior lenders, who were
owed $392 million, became the Company's new owners. Star Tribune
took on most of that debt when private-equity firm Avista Capital
Partners bought the paper from McClatchy Co. for $530 million in
2007. Avista lost its ownership as part of the bankruptcy
reorganization.
STOCKTON, CA: Insurer Objects to $100MM Writedown Request
---------------------------------------------------------
Carolina Bolado at Bankruptcy Law360 reports that Assured Guaranty
Ltd. said Aug. 1, 2012, that Stockton, Calif., is unfairly
targeting the municipal bond insurer by asking it to take a $100
million loss on the city's Assured-backed pension bonds rather
than tackle pension reform.
Stockton, the largest municipality ever to file for bankruptcy in
the U.S., proposed to eliminate all of the city's general fund
debt payment related to the pension bonds, which would mean an 83
percent cut in payments on the $121 million in remaining pension
bond principal, Assured said.
About Stockton, Calif.
The City of Stockton, California, filed a Chapter 9 petition
(Bankr. E.D. Calif. Case No. 12-32118) in Sacramento on June 28,
2012, becoming the largest city to seek creditor protection in
U.S. history. The city was forced to file for bankruptcy after
talks with bondholders and labor unions failed. Stockton
estimated more than $1 billion in assets and in excess of $500
million in liabilities.
The city, with a population of about 300,000, identified the
California Public Employees Retirement System as the largest
unsecured creditor with a claim of $147.5 million for unfunded
pension costs. In second place is Wells Fargo Bank NA as trustee
for $124.3 million in pension obligation bonds. The list of
largest creditors includes $119.2 million owing on four other
series of bonds.
The city is being represented by Marc A. Levinson, Esq., at
Orrick, Herrington & Sutcliffe LLP. The petition was signed by
Robert Deis, city manager.
Mr. Levinson also represented the city of Vallejo, Calif. in its
2008 bankruptcy. Vallejo filed for protection under Chapter 9
(Bankr. E.D. Calif. Case No. 08-26813) on May 23, 2008, estimating
$500 million to $1 billion in assets and $100 million to $500
million in debts in its petition. In August 2011, Vallejo was
given green light to exit the municipal reorganization. The
Vallejo Chapter 9 plan restructures $50 million of publicly held
debt secured by leases on public buildings. Although the Plan
doesn't affect pensions, it adjusts the claims and benefits of
current and former city employees. Bankruptcy Judge Michael
McManus released Vallejo from bankruptcy on Nov. 1, 2011.
SYMS CORP: Fla. Property Auction Scheduled for Aug. 14
------------------------------------------------------
BankruptcyData.com reports that Filene's Basement filed with the
U.S. Bankruptcy Court a notice stating that the auction of Syms'
property located in Miami, Florida is scheduled for August 14,
2012. The bid deadline and sale hearing are scheduled for
August 13, 2012 and August 16, 2012, respectively. As previously
reported, the Debtors have entered into a stalking horse agreement
with Independent Living Systems to purchase the property for $4.5
million.
About Filene's Basement & Syms Corp.
Massachusetts-based Filene's Basement, also called The Basement,
is the oldest off-price retailer in the United States. The
Basement focuses on high-end goods and is known for its
distinctive, low-technology automatic markdown system.
Filene's Basement first filed for Chapter 11 bankruptcy protection
in August 1999. Filene's Basement was bought by a predecessor of
Retail Ventures, Inc., the following year. Retail Ventures in
April 2009 transferred the unit to Buxbaum.
Filene's Basement, Inc. and its affiliates filed for Chapter 22
(Bankr. D. Del. Case No. 09-11525) on May 4, 2009, represented by
lawyers at Pachulski Stang Ziehl & Jones LLP. Epiq Bankruptcy
Solutions serves as claims and notice agent. The Debtors
disclosed assets of $236 million, including real estate of $97.7
million, and liabilities of $94 million, including $31.1 million
owing on a revolving credit with Bank of America NA as agent. In
addition, there were $11.1 million in letters of credit
outstanding on the revolver.
The 2009 Debtor was formally renamed FB Liquidating Estate,
following the sale of all of its assets to Syms Corp. in June
2009.
Pursuant to the Liquidating Plan confirmed in January 2010,
secured creditors in the Chapter 11 case have been paid in full,
and holders of priority, administrative and convenience class
claims have received 100% of their allowed claims. As reported by
the Troubled Company Reporter on Dec. 20, 2010, Alan Cohen,
Chairman of Abacus Advisors LLC and Chief Restructuring Officer
for FB Liquidating Estate disclosed that a second distribution of
dividend checks to Filene's unsecured creditors amounting to 12.5%
of approved claims has been made, bringing the cumulative
distributions on unsecured claims to 62.5%.
On Nov. 2, 2011, Syms Corp. placed itself, Filene's Basement and
two other units in Chapter 11 bankruptcy (Bankr. D. Del. Case Nos.
11-13511 to 11-13514) after a failed bid to sell the business.
The two units are Syms Clothing Inc. and Syms Advertising Inc.
Judge Kevin J. Carey presides over the case. Lawyers at Skadden
Arps Slate Meagher & Flom LLP serve as the Debtors' counsel. The
Debtors tapped Rothschild Inc. as investment banker and Cushman
and Wakefield Securities, Inc., as real estate financial advisors.
Syms shuttered its namesake and Filene's Basement outlets upon the
bankruptcy filing and tapped a joint venture of Gordon Brothers
Retail Partners LLC and Hilco Merchant Resources LLC to run the
going-out-of-business sales. The sale may continue until Jan. 31,
2012.
Filene's Basement estimated $1 million to $10 million in assets
and $50 million to $100 million in debts. The petitions were
signed by Gary Binkoski, authorized representative of Filene's
Basement.
The official committee of unsecured creditors appointed in the
2011 case has retained Hahn & Hessen LLP as legal counsel.
Holders of equity in Syms Corp. pushed for an official
shareholders' committee and separation of the Syms and Filene's
Basement bankruptcy estates.
Gordon Brothers and Hilco are represented by Goulston & Storrs,
P.C. and Ashby & Geddes, P.A.
TRAFFIC CONTROL: Creditor's Panel Can Tap GlassRatner as Advisor
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in the Traffic
Control and Safety Corporation, et al. bankruptcy case sought and
obtained permission from the Hon. Kevin J. Carey of the U.S.
Bankruptcy Court for the District of Delaware to retain
GlassRatner Advisory & Capital Group LLC as its financial advisor
in this proceeding, effective as of May 7, 2012.
On May 1, 2012, the U.S. Trustee appointed the Committee. The
Committee consists of Solar Technology, Inc., Traffix Devices,
Inc., Namasco Corporation, 3M Company, and OTW Safety.
GlassRatner will, among other things:
a) perform a preliminary assessment of the Debtors'
financial condition;
b) establish reporting procedures that will allow for the
monitoring of the Debtors' post-petition operations;
c) monitor Debtors' weekly operating results;
d) analyze Debtors' budget to actual results on an ongoing
basis for reasonableness and cost control;
e) review reports of filings, including, but not limited to,
schedules of assets and liabilities; statements of
financial affairs and monthly operating reports;
GlassRatner will be paid at these hourly rates:
Principals $450-$495
Managers/Senior Managers/Directors $225?$405
Other Professional Staff $150?$250
Wayne P. Weitz, senior managing director of of GlassRatner
Advisory, attested to the Court that the firm is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.
About Traffic Control
Traffic Control and Safety Corporation and six subsidiaries filed
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-11287) on
April 20, 2012. TCSC is the largest independent provider of
safety services and products in California and Hawaii. Formed by
Marwit Capital Partners II, L.P., in June 2007, TCSC has 430 full-
time employees and serves state and local agencies, public works
organizations, general contractors, the motion picture industry,
and provide services at special events.
TCSC estimated assets of up to $50 million and debts of up to
$100 million as of the Chapter 11 filing.
Judge Kevin J. Carey presides over the case. Latham & Watkins LLP
serves as the Debtors' bankruptcy counsel and Young Conaway
Stargatt & Taylor LLP as Delaware counsel. Broadway Advisors, LLC
serves as financial advisors, and Epiq Bankruptcy Solutions LLC as
the claims and notice agent.
TUCSON & PIMA: Moody's Reviews 'Ba3' Bond Rating for Downgrade
--------------------------------------------------------------
Moody's Investors Service has placed the Ba3(sf) rating of Tucson
& Pima County Industrial Development Authority, AZ, Single Family
Mortgage Revenue Bonds Series 2006A-2 under review for downgrade.
The rating action, affecting $300,000 of outstanding debt, was
based on deteriorating second mortgage portfolio performance.
During the review Moody's will assess updated cash flow
projections.
What Could Make The Rating Go Up
* It is unlikely that the rating would go up considering it is
under review for downgrade due to deteriorating loan
performance
What Could Make The Rating Go Down
* If forecasted loan losses exceed the break even rate of
subordinate loans defaults the bonds can withstand
* Further deterioration of the loan portfolio
The principal methodology used in this rating was Moody's Rating
Approach For Single Family, Whole-Loan Housing Programs published
in May 1999.
US AIRWAYS: S&P Corrects Rating on 2001-1 Class G Certs. to 'BB'
----------------------------------------------------------------
Standard & Poor's Ratings Services corrected its issue rating on
US Airways Inc.'s 2001-1 Class G pass-through certificates to 'BB'
(sf) from 'BB/Negative' (sf). "The 'BB' (sf) rating is based on
the consolidated credit quality of US Airways Group Inc. (B-
/Stable/--, US Airways Inc.'s parent), collateral coverage by
aircraft that we believe US Airways would likely seek to retain in
any future bankruptcy proceeding, and legal and structural
protections available to the certificateholders. The withdrawal of
the outlook reflects the fact that our 'B' rating on MBIA
Insurance Corp. (B/Negative/--), which insures the certificates,
no longer determines our rating on the 2001-1G certificates," S&P
said.
RATINGS LIST
Outlook Withdrawn
To From
US Airways Inc.
2001-1 Class G pass-through certificates BB(sf) BB/Negative(sf)
USEC INC: Files Form 10-Q; Incurs $92-Mil. Loss in Second Quarter
-----------------------------------------------------------------
USEC Inc. filed with the U.S. Securities and Exchange Commission
its quarterly report on Form 10-Q disclosing a net loss of
$92 million on $364.8 million of total revenue for the three
months ended June 30, 2012, compared with a net loss of $21.2
million on $454.4 million of total revenue for the same period
during the prior year.
For the six months ended June 30, 2012, showed $120.8 million on
$926.3 million of total revenue, as compared to a net loss of
$37.8 million on $834.9 million of total revenue for the same
period a year ago.
The Company's balance sheet at June 30, 2012, showed $3.78 billion
in total assets, $3.13 billion in total liabilities and $642.6
million in stockholders' equity.
Bankruptcy Warning
The Company said in its quarterly report for the period ended
June 30, 2012, that "A delisting of our common stock by the NYSE
and the failure of our common stock to be listed on another
national exchange could have significant adverse consequences. A
delisting would likely have a negative effect on the price of our
common stock and would impair shareholders' ability to sell or
purchase our common stock. As of June 30, 2012, we had $530
million of convertible notes outstanding. A "fundamental change"
is triggered under the terms of our convertible notes if our
shares of common stock are not listed for trading on any of the
NYSE, the American Stock Exchange, the NASDAQ Global Market or the
NASDAQ Global Select Market. Our receipt of a NYSE continued
listing standards notification described above did not trigger a
fundamental change. If a fundamental change occurs under the
convertible notes, the holders of the notes can require us to
repurchase the notes in full for cash. We do not have adequate
cash to repurchase the notes. In addition, the occurrence of a
fundamental change under the convertible notes that permits the
holders of the convertible notes to require a repurchase for cash
is an event of default under our credit facility. Accordingly,
our inability to maintain the continued listing of our common
stock on the NYSE or another national exchange would have a
material adverse effect on our liquidity and financial condition
and would likely require us to file for bankruptcy protection."
A copy of the Form 10-Q is available for free at:
http://is.gd/S7J5bv
About USEC Inc.
Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) --
http://www.usec.com/-- supplies enriched uranium fuel for
commercial nuclear power plants.
The Company reported a net loss of $540.70 million in 2011,
compared with net income of $7.50 million in 2010.
* * *
USEC Inc. carries 'Caa1' corporate and probability of default
ratings, with "developing" outlook, from Moody's, and 'CCC+' long
term foreign issuer credit rating and 'CCC-' long term local
issuer credit rating, with outlook "developing", from Standard &
Poor's.
In May 2010, S&P said that its rating and outlook on USEC Inc. are
not affected by the announcement that Toshiba Corp. and Babcock &
Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co.,
have signed a definitive investment agreement for $200 million
with USEC.
VANITY EVENTS: Hires Sadore to Provide Advisory Services
--------------------------------------------------------
Vanity Events Holding, Inc., on July 19, 2012, entered into a
consulting agreement with Sadore Consulting Group LLC pursuant to
which the Consultant agreed to provide certain strategic advisory
services to the Company for a period of 30 days in consideration
for (i) $15,000 and (ii) 250,000 shares of the Company's common
stock.
The shares of common stock are not registered under the Securities
Act of 1933, as amended, or the securities laws of any state and
were issued in reliance on the exemption from registration
afforded by Section 4(2) of the Securities Act and corresponding
provisions of state securities laws which exempt transactions by
an issuer not involving any public offering.
About Vanity Events
Based in New York, Vanity Events Holding, Inc. (OTC BB: VAEV)
-- http://www.vanityeventsholding.com/-- is a holding company
with two primary subsidiary companies. The subsidiaries are
Vanity Events, Inc. and America's Cleaning Company. America's
Cleaning Company(TM) is the Company's flagship division which
provides cleaning services to residential and commercial clients.
Vanity Events, Inc. seeks out, Licenses, develops, promotes, and
brings to market various innovative consumer and commercial
products.
Vanity Events' balance sheet at March 31, 2012, showed $3.28
million in total assets, $18.80 million in total liabilities, all
current, and a $15.52 million total stockholders' deficit.
The Company reported net income of $330,705 in 2011 compared with
a net loss of $544,831 in 2010.
RBSM LLPk, in New York, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2011. The independent auditors noted that the Company has
suffered losses since inception and is experiencing difficulty in
generating sufficient cash flows to meet its obligations and
sustain its operations, which raises substantial doubt about its
ability to continue as a going concern.
Bankruptcy Warning
The Company said in its quarterly report for the period ended
March 31, 2012, that management has implemented new business
plans. The Company's ability to implement its current business
plan and continue as a going concern ultimately is dependent upon
its ability to obtain additional equity or debt financing, attain
further operating efficiencies and to achieve profitable
operations.
"There can be no assurances that funds will be available to the
Company when needed or, if available, that such funds would be
available under favorable terms. In the event that the Company is
unable to generate adequate revenues to cover expenses and cannot
obtain additional funds in the near future, the Company may seek
protection under bankruptcy laws. To date, management has not
considered this alternative, nor does management view it as a
likely occurrence, since the Company is progressing with various
potential sources of new capital and we anticipate a successful
outcome from these activities. However, capital markets remain
difficult and there can be no certainty of a successful outcome
from these activities."
VANN'S INC: Files for Bankruptcy, Won't Close Stores
----------------------------------------------------
Vann's Inc., a retailer of appliances and consumer electronics
with five stores in Montana, filed for Chapter 11 protection
(Bankr. D. Mont. Case No. 12-61281) in Butte, Montana, on Aug. 5,
2012. Gerald McConnell, who was named CEO of Vann's mid-June,
said in a e-mail message to the Troubled Company Reporter that the
remaining stores are still profitable and the company won't be
closing any stores.
Mr. McConnell also stated that the company has DIP financing from
First Interstate Bank that would support the company through the
Chapter 11 process.
Vann's, an audio, video, and appliance specialist based in
Missoula, has been serving Montana since 1961. Vann's has five
retail stores in Billings, Bozeman, Flathead Valley, Hamilton and
Missoula, and an e-commerce site at http://www.vanns.com/ The
Debtor also owns outdoor clothing and sports products at
http://www.bigskycountry.com/ Vann's is owned by an employee
stock ownership plan trust.
Road to Bankruptcy
Mr. McConnell said in a court filing that a number of factors have
led to Vann's recent financial distress.
Vann's, like other retailers, has for the past few months and
years experienced increasing financial difficulties. Mr.
McConnell noted of other retailers that have sought Chapter 11
protection: Borders, The Sharper Image, Circuit City, Blockbuster,
Linens N' Things, and Gottschalks. He also said Vann's has
suffered losses as a result of expanding beyond its core business
of selling quality appliances and consumer electronics through its
online and retail locations, on which its reputation and customer
relationships were built.
Vann's took several steps to begin restructuring its operations,
including closing underperforming locations, renegotiating leases,
and replacing its CEO. In mid-June, almost immediately after
Vann's board of directors hired Mr. McConnell as CEO, the company
received a conditional termination letter from GE Commercial
Distribution Finance Corp, stating that GE would terminate its
financing. GE declared a payment default July 23 and accelerated
the loan at the end of July.
First Day Motions
In the Chapter 11 case, the Debtor has sought an expedited hearing
on its request to use cash collateral and honor customer
contracts. As of July 31, 2,871 customer have made deposits of
$1.569 million for goods that the Debtor has agreed to deliver at
a future date.
The Debtor said it has reached a deal for postpetition financing
with secured lender First Interstate Bank. FIB has agreed to
provide a $2 million revolving credit loan to finance the Chapter
11 effort. However, the Debtor has not yet filed a DIP financing
motion as the "precise terms of the financing" are still being
finalized.
The Debtor disclosed assets of $17.6 million and liabilities of
$14.4 million. Assets include $12.2 million cost-value of
inventory plus $1 million in current accounts receivable. The
company owes $4 million to First Interstate Bank. It also owes
$4.8 million on an inventory loan from GE Commercial Distribution
Finance Corp.
The Debtor on the Petition date filed applications to employ (i)
Alan D. Smith, Brian A. Jennings and the law firm Perkins Coie LLP
as bankruptcy counsel, and (ii) Hamstreet & Associates, LLC, as
turnaround and restructuring advisors.
VANN'S INC.: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Vann's Inc.
3623 Brooks Street
Missoula, MT 59801
Bankruptcy Case No.: 12-61281
Chapter 11 Petition Date: August 5, 2012
Court: U.S. Bankruptcy Court
District of Montana (Butte)
Debtor's Counsel: Alan Douglas Smith, Esq.
PERKINS COIE LLP
1201 Third Avenue, Suite 4900
Seattle, WA 98101
Tel: (206) 359-8410
E-mail: adsmith@perkinscoie.com
- and ?
Brian Andrew Jennings, Esq.
PERKINS COIE LLP
1205 Third Avenue, Suite 4900
Seattle, WA 98101
Tel: (206) 359-3679
E-mail: bjennings@perkinscoie.com
Debtor's
Restructuring
Advisor: HAMSTREET & ASSOCIATES, LLC
Scheduled Assets: $17,633,342
Scheduled Liabilities: $14,394,323
The petition was signed by Gerald J. McConnell, CEO.
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Klipsch LLC Trade Debt $600,673
3501 Woodview Trace, Suite 200
Indianapolis, IN 46268
United Parcel Service Trade Debt $221,360
55 Glenlake Parkway NE
Atlanta, GA 30328
Warrantech Trade Debt $178,431
2200 Highway 121
Bedford, TX 76021
D & H Distributing Trade Debt $159,466
Northwest Cabinet Works Trade Debt $156,225
Onkyo USA Corporation Security Interest $137,106
Tri-State Distributors Trade Debt $135,791
Denon Electronics Inc. Trade Debt $133,001
Fedex Freight West, Inc. Trade Debt $119,634
Definitive Tech. Trade Debt $111,084
Yamaha Electronics Corporation, Vendor $105,696
USA
Canon USA, Inc. Video Trade Debt $100,520
Verizon Wireless Vendor $69,850
Pacific Specialty Brands Trade Debt $68,726
Marantz Company, Inc. Trade Debt $67,458
Sanus Systems Trade Debt $62,879
Big Mountain Builders Customer Deposit $51,929
American Power Conversion Trade Debt $49,772
Polk Audio Trade Debt $48,196
Billings Gazette Trade Debt $37,516
VELO HOLDINGS: OK'd to Pick Stalking Horse Bidders for Asset Sale
-----------------------------------------------------------------
The Hon. Martin Glenn of the U.S. Bankruptcy Court for the
Southern District of New York authorized Velo Holdings Inc., et
al., to: (i) designate one stalking horse bidder for the sale of
Coverdell & Company, Inc.'s assets; one stalking horse bidder for
the sale of, and Neverblue Communications, Inc.'s assets; and (ii)
grant related bid protections to the stalking horse bidders.
In this connection, the Court approved the modified Coverdell bid
procedures and the modified Neverblue bid procedures. The
modified Coverdell bid procedures and the modified Neverblue bid
procedures will govern the bidding process only if a Coverdell
Stalking Horse Designee or a Neverblue Stalking Horse Designee is
selected; otherwise, the respective bidding procedures previously
approved under the Coverdell bid procedures order and the
Neverblue bid procedures order will govern.
As reported in the Troubled Company Reporter on May 25, 2012, the
Debtor requested for the entry of an order establishing bidding
procedures in connection with an auction to determine the plan
sponsor that submits the highest or otherwise best offer to
acquire, pursuant to a joint chapter 11 plan of reorganization of
Debtor Velo Holdings Inc. and certain of its subsidiaries, 100% of
the reorganized equity interest of Velo, which, upon confirmation,
will solely consist of Velo's equity interest in the business of
Debtor Coverdell & Company, Inc. and its subsidiaries.
As reported in the TCR June 8, 2012, the Court approved bidding
procedures for the sale of substantially all assets of Debtor
Neverblue Communications, Inc., and 100% of the equity of 3091224
Nova Scotia Company that is owned by LN, Inc.
The Court also ordered the the Debtors, with the consent of the
First Lien Agent and after consultation with the Official
Committee of Unsecured Creditors, to designate one Coverdell
Stalking Horse Designee and one Neverblue Stalking Horse Designee.
The Court also ordered that, among other things:
1. if the Coverdell Stalking Horse Designee provides a binding
bid for the Coverdell Sale, then the Debtors are authorized to
enter into an agreement with the Coverdell Stalking Horse Designee
providing for the Coverdell Break Up Fee and the Coverdell Expense
Reimbursement; provided, however, that in no event will the
Coverdell Break Up Fee exceed $1.25 million or the Coverdell
Expense Reimbursement exceed $250,000.
2. if the Neverblue Stalking Horse Designee provides a binding
bid for the Neverblue Sale, then the Debtors are authorized to
enter into an agreement with the Neverblue Stalking Horse Designee
providing for the Neverblue Break Up Fee and the Neverblue Expense
Reimbursement; provided, however, that in no event will the
Neverblue Break Up Fee exceed $600,000 or the Neverblue Expense
Reimbursement exceed $200,000.
Objections, if any, to the Debtors' designation of a plan sponsor
for the Coverdell Sale are due by 4 p.m. on Aug. 16, 2012.
The designation hearing to consider approval of of the Debtors'
entry into the modified agreement with the successful bidder (or
to approve the Stalking Horse Plan Sponsor Agreement if no auction
is necessary) will be held on Aug. 21, at 10 a.m.
About Velo Holdings, V2V et al.
V2V Corp. is a premier direct marketing services company,
providing individuals and businesses with access to a wide-variety
of consumer benefits in the United States, Canada, and the United
Kingdom. V2V was founded in 1989 as a membership services company
that marketed its membership programs exclusively via
telemarketing and, after having nearly a decade of continued
growth, went public in 1996. In 2007, V2V was acquired by a
consortium of private equity firms led primarily by investing
affiliates of One Equity Partners.
Norwalk, Connecticut-based Velo Holdings Inc. and various
affiliates, including V2V, filed for Chapter 11 bankruptcy (Bankr.
S.D.N.Y. Case Nos. 12-11384 to 12-11386 and 12-11388 to 12-11398)
on April 2, 2012. The debtor-affiliates are V2V Holdings LLC,
Coverdell & Company, Inc., V2V Corp., LN Inc., FYI Direct Inc.,
Vertrue LLC, Idaptive Marketing LLC, My Choice Medical Holdings
Inc., Adaptive Marketing LLC, Interactive Media Group (USA) Ltd.,
Brand Magnet Inc., Neverblue Communications Inc., and Interactive
Media Consolidated Inc.
Judge Martin Glenn presides over the case. Lawyers at Dechert LLP
serve as the Debtors' counsel. The Debtors' financial advisors
are Alvarez & Marsal Securities LLC. The Debtors' investment
banker is Alvarez & Marsal North America, LLC.
Quinn Emanuel Urquhart & Sullivan, LLP, serves as the Debtors'
special counsel. Epiq Bankruptcy Solutions serves as the
Debtors' claims agent. Velo Holdings estimated $100 million to
$500 million in assets and $500 million to $1 billion in debts.
The petitions were signed by George Thomas, general counsel.
Lawyers at Willkie Farr & Gallagher LLP represent Barclays, the
First Lien Prepetition Agent and the DIP Agent. The First Lien
Prepetition Agent and DIP Agent also has hired FTI Consulting,
Inc. Sidley Austin LLP represents the Second Lien Prepetition
Agent.
Tracy Hope Davis, U.S. Trustee for Region 2, appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Velo Holdings Inc., et al.
VENTANA 20/20: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Ventana 20/20 LP
5800 North Kolb Road
Tucson, AZ 85750
Bankruptcy Case No.: 12-17493
Chapter 11 Petition Date: August 3, 2012
Court: U.S. Bankruptcy Court
District of Arizona (Tucson)
Judge: Eileen W. Hollowell
Debtor's Counsel: Frederick J. Petersen, Esq.
MESCH, CLARK & ROTHSCHILD, P.C.
259 N. Meyer Avenue
Tucson, AZ 85701
Tel: (520) 624-8886
Fax: (520) 798-1037
E-mail: ecfbk@mcrazlaw.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by John Murphy, manager of Ventana 20/20
GP, LLC.
VILLAGIO PARTNERS: 7 Marcel Group Entities File for Chapter 11
--------------------------------------------------------------
Villagio Partners Ltd., along with six affiliates, filed a bare-
bones Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-35928) in
Houston on Aug. 6, 2012.
The petitions were signed by Vernon M. Veldekens, CEO for The
Marcel Group.
The Marcel Group -- http://www.themarcelgroup.com/-- is an
integrated commercial real estate firm specializing in
development, construction, design, engineering, master planning,
leasing and property management.
Village Partners, a Single Asset Real Estate as defined in 11
U.S.C. Sec. 101(51B), estimated assets and debts of at least
$10 million. It says that a real property in Katy, Texas, is
worth $24.6 million.
The Debtors are represented by Wayne Kitchens, Esq., at Hughes
Watters Askanase LLP, in Houston.
VILLAGIO PARTNERS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Villagio Partners Ltd.
P.O. Box 9556
The Woodlands, TX 77387
Bankruptcy Case No.: 12-35928
Chapter 11 Petition Date: August 6, 2012
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Marvin Isgur
Debtor's Counsel: Wayne Kitchens, Esq.
HUGHES WATTERS ASKANASE LLP
333 Clay St., 29 Flr
Houston, TX 77002
Tel: (713) 759-0818
Fax: (713) 759-6834
E-mail: jwk@hwallp.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
Affiliates that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
Compass Care Holdings Ltd. 12-35930
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
Cinco Office VWM, L.P. 12-35931
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Greens Imperial Center Inc. 12-35932
Marcel Construction & Maintenance, Ltd. 12-35934
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Tidwell Properties Inc. 12-35936
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Research - New Trails Partners Ltd. 12-35937
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
The petitions were signed by Vernon M. Veldekens, manager.
A. Villagio Partners' List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Compass Care Promissory Note $2,528,841
Holdings Ltd.
P.O. Box 9556
The Woodlands, TX 77387
Charles Veldekens Promissory Note $325,357
Commercial Real Services $178,613
Ventures Management
P.O. Box. 9556
The Woodlands, TX 77387
G&G Construction Services $43,863
Enterprises
The Hartford Insurance $9,560
Victoria Veldekens Marketing Services $8,000
Victor Veldekens Services $7,500
Chase Card Services Credit Card $5,808
TDI Services Utilities $4,808
The Brickman Group Ltd. Services $3,149
Cinco MUD#2 Utilities $2,989
Olde English Windown Services $1,675
Cleaning
UGL Services Services $1,414
American Express Credit Card $933
Business Platinum
Skyline Roofing Ltd. Services $378
Consolidated Services $360
Communications
Shegga Design Services $200
Spark Energy Utilities $0
Optiquest Internet Services $0
Services
Mirage Pool Services Services $0
B. Cinco Office's List of Nine Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Compass Care Promissory Note $498,175
Holdings, Ltd.
P.O. Box 9556
The Woodlands, TX 77387
Charles Veldekens Promissory Note $124,151
Waste Management of Services $0
Texas, Inc.
The Hartford Insurance $0
The Brickman Group Ltd. Services $0
Spark Energy Services $0
Complete Home Services $0
Maintenance
Cinco MUD#12 Services $0
Andrew Myers, Atty. Services $0
C. Compass Care Holdings' List of 14 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Charles Veldekens Promissory Note $2,752,933
Tidwell Properties, Inc. Promissory Note $860,000
P.O. Box 9556
The Woodlands, TX 77387
Commercial Real Services $23,457
Ventures Management
P.O. Box. 9556
The Woodlands, TX 77387
The Brickman Group Ltd. Services $6,834
The Hartford Unsecured $4,525
Spark Energy Services $1,250
Harris County MUD#152 Services $859
G&G Construction Services $706
Enterprises
Stripe-N-Sweep, Inc. Services $280
Skyline Roofing Ltd. Services $270
Waste Managment of Services $0
Texas, Inc.
Complete Home Services $0
Maintenance
Chase Card Services Credit Card $0
Byford Electric Services $0
D. Marcel Construction & Maintenance's List of 11 Largest
Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Compass Care Promissory Note $64,693
Holdings, Ltd.
P.O. Box 9556
The Woodlands, TX 77387
Commercial Real Services $25,434
Ventures Management
P.O. Box 9556
The Woodlands, TX 77387
Highlight Signs & Services $3,596
Graphics
56 Cooper Road
Houston, TX 77076
The Brickman Group Ltd. Services $1,568
Skyline Roofing Ltd. Services $1,461
The Hartford Insurance $1,153
American Express Credit Card $318
Batteries Plus Services $298
Entergy Services $294
Waste Management of Services $0
Texas
Stanley Lake MUD Services $0
E. Research - New Trails' List of 16 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Compass Care Promissory Note $166,751
Holdings, Ltd.
P.O. Box 9556
The Woodlands, TX 77387
Commercial Real Services $53,361
Ventures Management
P.O. Box 9556
The Woodlands, TX 77387
UGL Services Services $2,761
4002 Solutions Center
Chicago, IL 60677-4000
The Hartford Insurance $2,190
Andrews Myers, Services $1,575
Attorney at Law
The Brickman Group Ltd. Services $1,233
Skyline Roofing Ltd. Services $649
Olde English Window Services $550
Cleaning
Waste Management of Services $0
Texas, Inc.
The Woodlands Joint Utilities $0
Power Agency
Entergy Utilities $0
Complete Home Services $0
Maintenance
Chase Card Services Credit Card $0
Byford Electric Services $0
AT&T Services $0
ADT Security Service Services $0
F. Tidwell Properties' List of 10 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wells Fargo Bank N.A. Loan $2,104,192
Wells Fargo Bank N.A. Loan $2,040,722
Commercial Real Services $68,143
Ventures Management
Victor Veldekens Services $7,600
City of Houston Utilities $3,335
Dept of Public Works
The Hartford Insurance $2,377
Chase Card Services Credit Card $2,134
The Brickman Group Ltd. Services $1,983
Skyline Roofing Ltd. Services $541
AT&T Services $169
VISTEON CORP: Eyes Takeovers to Boost Share
-------------------------------------------
Michael Bathon, substituting for Bloomberg News bankruptcy
columnist Bill Rochelle, reports that Visteon Corp., the U.S.
auto-parts maker with its stock at a post-bankruptcy low, is
looking at acquisitions in the climate and electronics product
sectors with a goal toward boosting market share in both.
According to the report, the company is considering acquisitions
in those two product groups, and may try again to gain full
ownership of South Korean joint venture Halla Climate Control
Corp., Don Stebbins, Visteon's chief executive officer, said in an
Aug. 2 interview with Bloomberg's Mark Clothier. He said he
doesn't expect any transactions to close this year.
About Visteon Corp
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is an automotive supplier
that designs, engineers and manufactures innovative climate,
interior, electronic and lighting products for automakers. The
Company has corporate offices in Van Buren Township, Michigan
(U.S.); Shanghai, China; and Kerpen, Germany. It has facilities
in 27 countries and employs roughly 35,500 people. The Company
disclosed assets of US$4,561,000,000 and debts of US$5,311,000,000
as of March 31, 2009.
Visteon Corporation and 30 of its affiliates filed for Chapter 11
protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786
through 09-11818). Judge Christopher S. Sontchi oversees the
Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein,
Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in
Chicago, Illinois, represented the Debtors in their restructuring
effort. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy
P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang
Ziehl & Jones LLP, in Wilmington, Delaware, served as the Debtors'
local counsel. The Debtors' investment banker and financial
advisor were Rothschild Inc. The Debtors' notice, claims, and
solicitation agent was Kurtzman Carson Consultants LLC. The
Debtors' restructuring advisor was Alvarez & Marsal North America,
LLC.
The Bankruptcy Court entered an order on Aug. 31, 2010, confirming
the Fifth Amended Plan of Reorganization of Visteon Corporation
and its debtor-affiliates. Visteon emerged from Chapter 11 on
Oct. 1.
* * *
In December 2010, Standard & Poor's Ratings Services assigned its
'B+' corporate credit rating on reorganized Visteon. Moody's
Investors Service gave Visteon Corporate Family and Probability of
Default Ratings of 'B1'.
VOLKSWAGEN-SPRINGFIELD: OK'd to Use Parts Credits to Buy Products
-----------------------------------------------------------------
The Hon. Robert G. Mayer of the U.S. Bankruptcy Court for the
Eastern District of Virginia signed a consent order authorizing
Volkswagen-Springfield, Inc., to use the factory parts credits of
Volkswagen Group of America, Inc.; and 1998, LTD.
The Debtor is a party to a Volkswagen Dealer Agreement. Pursuant
to the Dealer Agreement, the Debtor sells certain Volkswagen
authorized products, consisting of authorized automobiles and
genuine parts.
VWGoA issues certain credits to dealers for the purchase and sale
of genuine parts. The Debtor has a parts credits balance of
approximately $241,000 through May 2012. At least $81,000 of the
parts credits arose prepetition. The Debtor is also a party to a
ground lease with 1998, LTD, an affiliate of VWGoA for the land
upon which its dealership operates.
The Court also ordered that Volkswagen accept payment in the form
of parts credits for the purchase of authorized products; and 1998
accept the parts credits to pay rent under the ground lease for
the months of May and July 2012 in the total amount of $74,768,
and for subsequent months as the rent becomes due.
VWGoA and 1998, had agreed to allow the use of parts credits to
pay for authorized products and to pay rent under the ground
lease, subject to retention of a minimum parts credit balance of
$70,000.
About Volkswagen-Springfield
Springfield, Virginia-based Volkswagen-Springfield, Inc., filed a
Chapter 11 petition (Bankr. E.D. Va. Case No. 12-12905) in
Alexandria on May 7, 2012. The Debtor operates one of the largest
Volkswagen franchised dealerships in the Mid-Atlantic region. The
Debtor estimated assets and debts of $10 million to $50 million as
of the Chapter 11 filing.
Judge Robert G. Mayer oversees the case. The Debtor is
represented by Dylan G. Trache, Esq., and John T. Farnum, Esq., at
Wiley Rein LLP, in McLean, Virginia.
Pursuant to recent default notices, Branch Banking and Trust
Company has asserted that it is owed $19.6 million. Jonathan L.
Hauser, Esq., at Troutman Sanders LLP, represents BB&T.
No creditors' committee has yet been appointed in the case
VYSTAR CORPORATION: Had $685,000 Net Loss in 1st Quarter
--------------------------------------------------------
Vystar Corporation filed its quarterly report on Form 10-Q,
reporting a net loss of $684,992 on $124,028 of revenues for the
three months ended March 31, 2012, compared with a net loss of
$1.06 million on $1.06 million on $119.04 million of revenues for
the same period last year.
The Company's balance sheet at March 31, 2012, showed
$1.07 million in total assets, $2.06 million in total liabilities,
and a stockholders' deficit of $994,425.
Habif, Arogeti & Wynne, LLP, in Atlanta, Georgia, expressed
substantial doubt about Vystar's ability to continue as a going
concern, following its results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has
recurring losses from operations, a capital deficit, and limited
capital resources.
A copy of the Form 10-Q is available for free at:
http://is.gd/OoK4KL
Duluth, Ga.-based Vystar Corporation is the creator and exclusive
owner of the innovative technology to produce Vytex(R) Natural
Rubber Latex ("NRL"). This technology reduces antigenic protein
in natural rubber latex products to virtually undetectable levels
in both liquid NRL and finished latex products.
WAVEDIVISION ESCROW: S&P Gives 'B-' Rating on $250M Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating and '6' recovery rating to the proposed $250 million of
senior notes due 2020 to be co-issued by WaveDivision Escrow Corp.
and WaveDivision Escrow LLC, subsidiaries of Kirkland, Wash.-based
cable service provider WaveDivision Holdings LLC. "The '6'
recovery rating indicates our expectation for negligible (0%-10%)
recovery in the event of payment default," S&P said.
"The proposed notes will be assumed by WaveDivision Holdings LLC
and WaveDivision Holdings Corp. if the escrow conditions have been
met. We expect proceeds to then be used, along with a new $471
million term loan and $202 million equity contribution from Oak
Hill Capital and GI Partners, to fund the acquisition of Wave by
the private-quity sponsors. Inclusive of management's reinvestment
of $40 million of equity, the transaction is valued at around
$925 million," S&P said.
"We had assumed the $250 million note issuance in our recent
assignment of ratings to Wave, so our financial risk assessment is
unchanged. The ratings reflect what we consider a 'fair' business
risk profile and a 'highly leveraged' financial risk profile. Pro
forma debt to EBITDA is elevated, at about 6.7x, including
realized synergies from the recently acquired assets from
Broadstripe in the Northwest U.S. In addition to the company's
high leverage, our financial risk profile assessment includes our
expectation for future debt-financed acquisitions and potential
dividends to its shareholders, which could constrain longer term
leverage improvement, notwithstanding our expectations for mid-
single-digit EBITDA growth," S&P said.
RATINGS LIST
WaveDivision Holdings LLC
Corporate Credit Rating B+/Stable/--
New Ratings
WaveDivision Escrow Corp.
WaveDivision Escrow LLC
Senior Unsecured
$250 mil nts due 2020 B-
Recovery Rating 6
WEST CORP: Intends to Offer $250 Million of Senior Notes
--------------------------------------------------------
West Corporation proposes to raise approximately $250 million
through an offering of senior notes. The proceeds from the notes
offering would be used, together with borrowings under a proposed
new approximately $720 million term loan under its senior secured
credit facilities, to refinance approximately $448 million of term
loans due in October 2013 and to pay a cash dividend in the amount
of approximately $500 million to West's stockholders. The
consummation of the notes offering is subject to market and other
conditions.
About West Corporation
Founded in 1986 and headquartered in Omaha, Nebraska, West
Corporation -- http://www.west.com/-- provides outsourced
communication solutions to many of the world's largest companies,
organizations and government agencies. West Corporation has a
team of 41,000 employees based in North America, Europe and Asia.
The Company's balance sheet at June 30, 2012, showed $3.33 billion
in total assets, $4.15 billion in total liabilities and a $823.98
million total stockholders' deficit.
Bankruptcy Warning
The Company said in its quarterly report for the period ended
June 30, 2012, that if it cannot make scheduled payments on its
debt, the Company will be in default, and as a result:
* the Company's debt holders could declare all outstanding
principal and interest to be due and payable;
* the lenders under the Company's new senior secured credit
facilities could terminate their commitments to lend the
Company money and foreclose against the assets securing its
borrowings; and
* the Company could be forced into bankruptcy or liquidation.
* * *
West Corp. carries a 'B2' corporate rating from Moody's and 'B+'
corporate rating from Standard & Poor's.
Moody's Investors Service upgraded the ratings on West
Corporation's existing senior secured term loan to Ba3 from B1 and
the rating on $650 million of existing senior notes due 2014 to B3
from Caa1 upon the closing of its recent refinancing transactions.
Concurrently, Moody's affirmed all other credit ratings including
the B2 Corporate Family Rating and B2 Probability of Default
Rating. The rating outlook is stable.
Standard & Poor's Ratings Services assigned Omaha, Neb.-based
business process outsourcer West Corp.'s proposed $650 million
senior unsecured notes due 2019 its 'B' issue-level rating (one
notch lower than the 'B+' corporate credit rating on the company).
The recovery rating on this debt is '5', indicating S&P's
expectation of modest (10% to 30%) recovery in the event of a
payment default. The company will use proceeds from the proposed
transaction and some cash on the balance sheet to redeem its
$650 million 9.5% senior notes due 2014.
WESTERLY HOSPITAL: Lawrence + Memorial Only Bidder for Hospital
---------------------------------------------------------------
Mystic River Press reports that Lawrence + Memorial Hospital
remains the sole bidder on The Westerly Hospital in Rhode Island
following closure of the court-sanctioned bidding period.
Mark Russo, the Providence lawyer overseeing Westerly Hospital?s
receivership, said this morning that while three other health care
organizations expressed recent interest, L+M is the only
institution to make a documented offer, according to Mystic River
Press.
Rhode Island Superior Court Associate Justice Brian Stern had set
Aug. 6, 2012, as the deadline for submitting offers.
Mystic River Press notes that Lawrence + Memorial has made a $69
million offer to acquire Westerly Hospital and received "stalking
horse" status by which it received incentives in return for making
the first offer and agreeing to allow terms of the offer to be
made public.
Mystic River Press discloses that Mr. Russo said he expects to
hear from L+M this week as to whether the New London-based
institution intends to continue with plans to take over Westerly
Hospital.
If L+M proceeds, its offer will be subject to review by Stern and
others during a "sales hearing" later this month, Mystic River
Press notes. If approved by Stern, state health care and legal
regulators would then review the offer, Mystic River Press
WESTERN COMMUNICATIONS: Full Payment Plan Wins Approval
-------------------------------------------------------
Western Communications, Inc., a small market newspaper, niche
publishing, printing and digital media company, has won
confirmation of its First Amended Plan of Reorganization which
provides full payment to all creditors.
As reported by the Troubled Company Reporter on Feb. 8, 2012, the
First Amended Plan contemplates that the Debtor will continue to
operate in the ordinary course and will pay and satisfy its
obligations under the Plan from Debtor's existing current assets
and from revenue generated by Debtor's continuing operations.
Bank of America is the Debtor's largest creditor and has security
interest in all or substantially all of the Debtor's personal
property and most of the Debtor's real property. The amended Plan
provides that B of A does not have a security interest in the
Debtor's real property located in Baker City, Oregon; Redmond,
Oregon,; Brookings, Oregon; or Hermiston, Oregon (with a combined
appraised fair market value of approximately $1,165,000).
Under the Amended Plan, B of A will have an Allowed Claim in the
amount of (i) all amounts owing by the Debtor to B of A as of the
Petition Date, plus (ii) to the extent that the value of B of A's
collateral securing its claim as of the Petition Date is greater
than the amount owing to B of A as of the Petition Date, interest
from the Petition Date through the Effective Date at the non-
default contract rate of interest and other reasonable fees, costs
or charges provided for under the BofA Loan Documents.
The Court also ordered that the Debtor's authority to use cash
collateral under and pursuant to the final order authorizing use
of cash collateral and granting adequate protection is extended
from May 31, 2012, to the Effective Date of the Plan.
About Western Communications
Western Communications, Inc., is a family-owned corporation
founded by renowned editor Robert W. Chandler. Headquartered in
Bend, Oregon, Western Communications is a small market newspaper,
niche publishing, printing and digital media company with
publications spread throughout Oregon (six publications) and
California (two publications). The Company produces and publishes
the Bend Bulletin, the Baker City Herald, the La Grande Observer,
the Redmond Spokesman, the Brookings Curry Coastal Pilot, the
Crescent City Daily Triplicate, and the Sonora Union Democrat.
The Company also publishes the Central Oregon Nickel Ads in Bend,
Oregon.
Western Communications filed for Chapter 11 bankruptcy (Bankr. D.
Ore. Case No. 11-37319) on Aug. 23, 2011. Albert N. Kennedy,
Esq., and Michael W. Fletcher, Esq., at Tonkon Torp LLP, in
Portland, Oregon, serve as the Debtor's bankruptcy counsel. The
Zinser Law Firm, P.C., and Davis Wright Tremaine LLP serve as the
Debtor's special purpose counsel. The petition was signed by
Gordon Black, president. In its amended schedules, the Debtor
disclosed assets of $31,255,376 and liabilities of $19,068,329 as
of the petition date.
The U.S. Trustee said that an official committee of unsecured
creditors has not been appointed because an insufficient number of
persons holding unsecured claims against Western Communications
have expressed interest in serving on a committee.
The Western Communications Plan was confirmed April 17. The
confirmation order is too long ago to focus on that.
Focus instead on the terms of the Plan.
WESTINGHOUSE SOLAR: Had $2.85 Million Net Loss in 1st Quarter
-------------------------------------------------------------
Westinghouse Solar, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $2.85 million on $2.42 million of net
revenue for the three months ended March 31, 2012, compared with a
net loss of $1.31 million on $1.99 million of net revenue for the
comparable period in 2011.
The Company's balance sheet at March 31, 2012, showed
$7.52 million in total assets, $4.97 million in total liabilities,
and stockholders' equity of $2.55 million.
As reported in the TCR on April 16, 2012, Burr Pilger Mayer, Inc.,
in San Francisco, California, expressed substantial doubt about
Westinghouse Solar's ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has
suffered significant operating losses and has negative
cash flow from operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/fdVZ75
Campbell, Calif.-based Westinghouse Solar, Inc., is a designer and
manufacturer of solar power systems and solar panels with
integrated microinverters.
WEZBRA DAIRY: Ohio Dairy Farm Owner Files in Indiana
----------------------------------------------------
Wezbra Dairy, LLC, operator of a dairy farm in Continental, Ohio,
filed a Chapter 11 petition (Bankr. N.D. Ind. Case No. 12-12592)
on Aug. 6.
The Debtor also filed a motion to use cash collateral. The Debtor
says it owes Bank of America N.A. the amount of $6.5 million,
secured by a blanket lien on the Debtor's assets.
The Debtor says there is an immediate need to use cash collateral
in the operation of its business. The Debtor says it owns 936
head of cattle and lease 24 head of cattle that must be fed and
maintained on a daily basis. There's also payroll due Aug. 13, to
pay 11 employees of the Debtor.
The Debtor on the petition date also filed an application to
employ Daniel J. Skekloff, Esq., and Scot T. Skekloff, Esq., at
Skekloff, Adelsperger & Kleven, LLP as attorneys.
WEZBRA DAIRY: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Wezbra Dairy, LLC
15257 Road C
Continental, OH 45831
Bankruptcy Case No.: 12-12592
Chapter 11 Petition Date: August 6, 2012
Court: U.S. Bankruptcy Court
Northern District of Indiana (Fort Wayne Division)
Judge: Robert E. Grant
Debtor's Counsel: Daniel J. Skekloff, Esq.
SKEKLOFF, ADELSPERGER & KLEVEN, LLP
927 South Harrison Street
Fort Wayne, IN 46802
Tel: (260)407-7000
Fax: (260)407-7137
E-mail: djs@sak-law.com
- and ?
Scot T. Skekloff, Esq.
SKEKLOFF, ADELSPERGER & KLEVEN, LLP
927 South Harrison Street
Fort Wayne, IN 46802
Tel: (260)407-7000
Fax: (260)407-7137
E-mail: sts@sak-law.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Johann van Wezel-Denissen, member.
Affiliates that filed separate Chapter 11 petitions:
Entity Case No. Petition Date
------ -------- -------------
New Holland Dairy Leasing, LLC 11-13651 09/27/11
New Holland Dairy, LLC 11-13644 09/27/11
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bank of America Lien $2,554,956
2001 NE 46th Street
Kansas City, MO 64116
Kruk LLC App. 950 Cows $229,002
7991 Tartan Fields Drive
Dublin, OH 43017
Ottawa Feed & Grain Co., Inc. -- $198,318
P.O. Box 262
Ottawa, OH 45875
Dennis Niese Corn and Straw Silage $122,512
Kuhlman's Auto Sales LLC -- $57,836
Carl Niese & Sons Farms Inc. -- $56,487
Louie Niese Corn and Straw Silage $56,193
The Ingredient Exchange Inc. -- $52,719
Commodity Blenders -- $32,827
Hill's Supply, Inc. -- $29,082
Performance Feeds & Seeds Inc. -- $28,824
Kuhlman Custom Chopping -- $23,000
Zeeland Farm Service -- $22,337
Phillips Oil Inc. -- $21,701
Niese Brothers Farms Corn Silage $18,438
ABS -- $17,655
MWI Veterinary Supply -- $16,616
Heulskamp Trucking -- $12,978
Lauwers Alfalfa & Straw Farms -- $12,509
Syb and Wietze Oenema -- $12,500
WIND CITY PENNA: Meeting to Form Committee Today
------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on Aug. 8, 2012, at 1:30 p.m. in
the bankruptcy case of Wind City Penna Oil & Gas LLC. The meeting
will be held at:
J. Caleb Boggs Federal Building
844 King Street, Room 5209
Wilmington, DE 19801
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 Wind City Penna Oil
Wind City Penna Oil & Gas is a wholly owned affiliate of Wind
City Oil & Gas LLC, which did not file for bankruptcy. Wind City
Oil & Gas is an independent oil and gas energy company engaged in
the acquisition, exploitation, development, production, operation
and commercialization of natural gas and oil properties primarily
in the Appalachian Basin of the United States.
Wind City Penna Oil & Gas filed a Chapter 11 petition (Bankr. D.
Del. Case No. 12-12143) on July 20, 2012. Alan Michael Root,
Esq., at Blank Rome LLP, in Wilmington, serves as counsel. THE
Debtor estimated asssets and debts under $10 million.
YNS ENTERPRISE: Files for Chapter 11 in Riverside
-------------------------------------------------
YNS Enterprise No. 1, LLC, filed a bare-bones Chapter 11 petition
(Bankr. C.D. Calif. Case No. 12-28185) on Aug. 5, 2012 in
Riverside, California.
The Debtor, a single asset real estate under 11 U.S.C. Sec.
101(51B), estimated assets and debts of at least $10 million.
It said that its principal asset is located at 8122 Foothill
Boulevard, in Rancho Cucamongo, California.
Related entities SSM Enterprises, Inc., YJC Investment Group V,
Inc., and YNS Investment Group, Inc. hold 100% of the membership
interests in the Debtor.
The petition was signed by Young Jae Chung, president of YJC.
YNS ENTERPRISE: Case Summary & 14 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: YNS Enterprise No. 1, LLC
8122 Foothill Boulevard
Rancho Cucamonga, CA 91730
Bankruptcy Case No.: 12-28185
Chapter 11 Petition Date: August 5, 2012
Court: U.S. Bankruptcy Court
Central District of California (Riverside)
Judge: Wayne E. Johnson
Debtor's Counsel: Timothy J. Yoo, Esq.
LEVENE NEALE BENDER RANKIN & BRILL LLP
10250 Constellation Boulevard, Suite 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
E-mail: tjy@lnbyb.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Young Jae Chung, president of YJC
Investment Group V, Inc., managing member.
Debtor's List of Its 14 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Paradigm Tax Group, LLC Tax Consulting $45,000
3030 North Central Avenue Services
Phoenix, AZ 85012
Golden Eagle Insurance Insurance $8,566
12912 Brookhurst Street, #480
Garden Grove, CA 92840
Pacific Century Investment, Inc. Management Services $6,737
11799 Sebastian Way, Suite 105
Rancho Cucamonga, CA 91730
Advanco Fire Protection Fire Certification $5,023
Services
Law Office of Frank K. Lee Legal Services $5,000
A&G Commercial Services Landscaping and $4,771
Related Services
GuardPower Security Security Services $4,568
First Class Sweeping & Pressure Services $3,700
Washing
Rancho Disposal Services, Inc. Trash Removal Services $2,565
Champion Fire System, Inc. Fire Monitoring $966
Services
John D. Yoo, CPA Accounting Services $600
Preferred Property Maintenance Lighting Services $517
King Locksmith Locksmith Services $285
Terminex Pest Control $69
YRC WORLDWIDE: Incurs $22.6 Million Net Loss in Second Quarter
--------------------------------------------------------------
YRC Worldwide Inc. filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $22.6 million on $1.25 billion of operating revenue for the
three months ended June 30, 2012, compared with a net loss of $43
million on $1.25 billion of operating revenue for the same period
a year ago.
The Company reported a net loss of $104.2 million $2.44 billion of
operating revenue for the six months ended June 30, 2012, compared
with a net loss of $145.6 million on $2.38 billion of operating
revenue for the six months ended June 30, 2011.
The Company's balance sheet at June 30, 2012, showed $2.42 billion
in total assets, $2.87 billion in total liabilities and a $443
million total shareholders' deficit.
"Our focused approach to pricing discipline, customer mix
management and cost initiatives has driven year-over-year
improvement in our business, which is reflected in our operating
income," stated James Welch, chief executive officer of YRC
Worldwide. "We are producing results slightly ahead of our
forecast, despite the recently softening economy, and remain
focused on executing our operations and sales strategies at all
operating companies. We continue to be committed to delivering
consistent, high-quality and cost-effective service for our
customers and value for our stakeholders," he added. "I also want
to especially recognize the resiliency and dedication of the
33,000 employees who are working diligently to help move YRCW
forward in a positive and progressive way. We are fortunate to
have employees who have the passion and the drive to return the
company to its leadership position, and they prove it every day by
working to satisfy our customers while at the same time embracing
our culture of working safely," said Welch.
A copy of the Form 10-Q is available for free at:
http://is.gd/Y93Z4s
About YRC Worldwide
Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ:
YRCW) -- http://www.yrcw.com/-- is a holding company that through
wholly owned operating subsidiaries offers its customers a wide
range of transportation services. These services include global,
national and regional transportation as well as logistics.
The Company reported a net loss of $354.41 million in 2011, a
net loss of $327.77 million in 2010, and a net loss of
$619.47 million in 2009.
After auditing the 2011 results, the Company's independent
auditors expressed substantial doubt about the Company's ability
to continue as a going concern. KPMG LLP, in Kansas City,
Missouri, noted that the Company has experienced recurring net
losses from continuing operations and operating cash flow deficits
and forecasts that it will not be able to comply with certain debt
covenants through 2012.
* * *
As reported in the Aug. 2, 2011 edition of the TCR, Moody's
Investors Service revised YRC Worldwide Inc.'s Probability of
Default Rating ("PDR") to Caa2\LD ("Limited Default") from Caa3 in
recognition of the agreed debt restructuring which will result in
losses for certain existing debt holders. In a related action
Moody's has raised YRCW's Corporate Family Rating to Caa3 from Ca
to reflect modest but critical improvements in the company's
credit profile that should result from its recently-completed
financial restructuring. The positioning of YRCW's PDR at Caa2\LD
reflects the completion of an offer to exchange a substantial
majority of the company's outstanding credit facility debt for new
senior secured credit facilities, convertible unsecured notes, and
preferred equity, which was completed on July 22, 2011.
In August 2011, Standard & Poor's Ratings Services raised its
corporate credit rating on YRC Worldwide Inc. to 'CCC' from 'SD'
(selective default), after YRC completed a financial
restructuring. Outlook is stable.
"The ratings on Overland Park, Kan.-based YRCW reflect its
participation in the competitive, capital-intensive, and cyclical
trucking industry," said Ms. Ogbara, "as well as its meaningful
off-balance-sheet contingent obligations related to multiemployer
pension plans." "YRCW's substantial market position in the less-
than-truckload (LTL) sector, which has fairly high barriers to
entry, partially offsets these risk factors. We categorize YRCW's
business profile as vulnerable, financial profile as highly
leveraged, and liquidity as less than adequate."
ZOGENIX INC: Repays Outstanding Loan with Oxford and Silicon
------------------------------------------------------------
Zogenix, Inc., repaid in full the entire $19.5 million of
outstanding principal and interest under its Second Amended and
Restated Loan and Security Agreement among Oxford Finance LLC,
successor in interest to Oxford Finance Corporation, and Silicon
Valley Bank. In connection with the repayment in full of all
principal and interest outstanding under the Loan Agreement, the
Company was required to make a final payment of $1.2 million and a
prepayment premium of $0.4 million, or 2% of the then outstanding
principal. The Company also paid a $0.1 million prepayment
premium to terminate the revolving credit facility under the Loan
Agreement. The Company no longer has any obligations under the
Loan Agreement, and there are no further encumbrances on the
Company's intellectual property and personal property under the
Loan Agreement.
Ann Rhoads, chief financial officer of Zogenix, said, "We utilized
a portion of the net proceeds from our $60.7 million equity
offering in July to eliminate the outstanding debt from our loan
agreement with Oxford Finance LLC and Silicon Valley Bank. This
will benefit our financial results by eliminating approximately
$3.5 million per quarter in principal and interest payments due
under the loan agreement. We are appreciative of both Oxford
Finance and Silicon Valley Bank for providing the loan facilities
during a critical stage of the Company's growth."
Ms. Rhoads added, "The remaining proceeds from the offering will
add to our financial resources as we continue developing the
Company's product portfolio. Our current cash position gives us
sufficient capital to continue the commercialization of SUMAVEL
DosePro, advance through potential commercialization of Zohydro
ER, and move forward with our earlier stage candidate, Relday.
Together, these three programs represent a potentially significant
growth opportunity for Zogenix."
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.
Ernst & Young LLP, in San Diego, Calif., issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2011, citing recurring losses from operations
and lack of sufficient working capital.
The Company reported a net loss of $83.90 million in 2011, a net
loss of $73.56 million in 2010, and a net loss of $45.88 million
in 2009.
The Company's balance sheet at March 31, 2012, showed
$82.28 million in total assets, $82 million in total liabilities,
and $278,000 in total stockholders' equity.
ZOGENIX INC: Great Point Discloses 5.8% Equity Stake
----------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Great Point Partners, LLC, Dr. Jeffrey R. Jay, M.D.,
and Mr. David Kroin disclosed that, as of July 24, 2012, they
beneficially own 5,750,000 shares of common stock of Zogenix,
Inc., representing 5.87% of the shares outstanding. A copy of the
filing is available for free at http://is.gd/tMnIAd
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.
Ernst & Young LLP, in San Diego, Calif., issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2011, citing recurring losses from operations
and lack of sufficient working capital.
The Company reported a net loss of $83.90 million in 2011, a net
loss of $73.56 million in 2010, and a net loss of $45.88 million
in 2009.
The Company's balance sheet at March 31, 2012, showed
$82.28 million in total assets, $82 million in total liabilities,
and $278,000 in total stockholders' equity.
Z TRIM HOLDINGS: Edward Smith Discloses 74.2% Equity Stake
----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Edward B. Smith, III, and his affiliates
disclosed that, as of Aug. 1, 2012, they beneficially own
31,559,669 shares of common stock of Z Trim Holdings, Inc.,
representing 74.2% of the shares outstanding.
Mr. Smith previously reported beneficial ownership of
31,142,057 common shares or a 67.6% equity stake as of May 8,
2012.
A copy of the amended filing is available for free at:
http://is.gd/IUmqtJ
About Z Trim
Mundelein, Ill.-based Z Trim Holdings, Inc., is a functional food
ingredient company which provides custom product solutions that
help answer the food industry's problems. Z Trim's revolutionary
technology provides value-added ingredients across virtually all
food industry categories. Z Trim's all-natural products, among
other things, help to reduce fat and calories, add fiber, provide
shelf-stability, prevent oil migration, and add binding capacity
-- all without degrading the taste and texture of the final food
products.
M&K CPAs,PLLC, in Houston, Texas, expressed substantial doubt
about the Company's ability to continue as a going concern
following the 2011 financial results. The independent auditors
noted that the Company had a working capital deficit and
reoccurring losses as of Dec. 31, 2011.
The Company reported a net loss of $6.94 million in 2011, compared
with a net loss of $10.91 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$4.54 million in total assets, $15.28 million in total
liabilities, $5.05 million in total commitment and contingencies
and a $15.79 million total stockholders' equity.
* Moody's Says Pension Plan Terminations Mostly Credit Neutral
--------------------------------------------------------------
Pension plan terminations will be mostly credit neutral as they
will likely come at a substantial liquidity cost to US companies,
says Moody's Investors Service in its new special comment "Pension
Terminations: No Free Lunch."
General Motors Company announced in June that it is terminating
its US salaried pension plan, which will reduce its reported
pension liabilities and assets by $26 billion and permanently
relieve itself of future pension liabilities.
"Companies that follow in GM's footsteps will greatly reduce their
underfunded pension liabilities and volatility associated with
pension assets and liabilities," said Michael Mulvaney, a Moody's
managing director and author of the report. "But such measures
will likely come at a substantial cost to their liquidity or an
increase in leverage. These upfront costs are key to the ultimate
credit impact of any termination program."
The costs of terminating a pension plan include fully funding the
plan and paying a premium to an insurer to assume the plan risk,
the report says. Moody's says its assessment of the transaction's
effect on an issuer's credit profile will be primarily focused on
the impact on liquidity and leverage relative to the magnitude of
the pension assets and liabilities that are removed.
Moody's expects that efforts by corporate issuers to reduce large
pension obligations will increase, as obligations distract from
core business activity, weaken financial profiles and weigh on the
market's perception of a company.
Companies that have taken steps to fully fund their pension plans
-- for instance, by closing their pension plans to new entrants or
making large discretionary contributions -- would be best
positioned to annuitize their plans, Moody's says. Companies that
fit this profile and have large benefit obligations relative to
their total market capitalization include defense services company
Exelis Inc., automaker Ford Motor Company and aircraft
manufacturer Boeing Company, according the report.
Life insurance companies are a natural fit for assuming pension
risk, which can drive future earnings growth and provide some
diversification, Moody's says, noting that insurers Prudential
Financial Inc. and MetLife Inc. are well positioned to handle
large pension termination transactions.
* Moody's Says Book Value Wraps Expose US Life Insurers to Risk
---------------------------------------------------------------
Since the financial crisis US life insurers have largely replaced
banks as the providers of book value wraps to pension plans, but
while that business is providing high returns insurers are exposed
to significant tail risk, Moody's Investors Service says in a new
report, "Stable Value Book Value Wraps Generate Strong ROEs, but
also Sizeable Tail Risks."
Book value wraps provide participants in stable value investment
options of pension plans a guarantee that benefit withdrawals will
be at book value, with the "wrap" absorbing the difference between
the market and book value of assets when withdrawals are made.
Book value wraps therefore protect pension investments from
fluctuations in market values.
No losses are expected under normal and under most adverse
scenarios because of the risk-sharing crediting rate mechanism,
contractual protections and limitations, and because participant
behavior is generally highly predictable. Following the financial
crisis, the product risk profile for stable value wraps improved
as contract terms became more stringent and fees increased
substantially.
"Although companies carefully underwrite the plans they insure and
contracts exclude certain event risks to protect the insurer,"
says Moody's Vice President and author of the report Ann Perry,
"we believe book value wraps expose insurers to substantial tail
risk because they do not allocate sufficient capital to the
business to cushion against potential losses in extreme adverse
scenarios."
Such scenarios would include where there are large, unexpected
withdrawals from a plan, and where the difference between the
market and book value of underlying investments is too great to be
adjusted for under the crediting rate mechanism, Perry says. In
these cases, insurers could see losses far in excess of both their
capital cushion and annual earnings from the product.
Capital allocated to the product is generally only 1% or less of
the contract book value; this small amount allows insurers to earn
high returns on the product. Indeed, high returns, in addition to
much higher fees and better contract terms since the crisis, have
led several companies to significantly ramp up their book value
wrap business, and more are likely to enter the market.
* S&P's Global Corp Default Tally Rises to 49 Issuers
-----------------------------------------------------
U.S.-based ethanol producer Aventine Renewable Energy Holdings
Inc. defaulted this week after its lenders agreed to a debt
forbearance that allowed the company to miss an interest payment
on its $225 million term loan agreement. This raises the 2012
global corporate default tally to 49 issuers, said an article
published Aug. 2 by Standard & Poor's Global Fixed Income
Research.
By region, 27 of the 49 defaulters were based in the U.S., with
13 based in the emerging markets, six in Europe, and three in the
other developed region (Australia, Canada, Japan, and New
Zealand). In comparison, the 2011 total (through Aug. 1) was 23:
14 defaulters in the U.S., two in the emerging markets, two in
Europe, and five in the other developed region.
So far this year, missed payments accounted for 13 defaults,
bankruptcy filings accounted for 13, distressed exchanges
accounted for 10, and eight defaulters were confidential.
The remaining five entities defaulted for various other reasons.
In 2011, 21 issuers defaulted because of missed interest or
principal payments, and 13 because of bankruptcy filings--both of
which were among the top reasons for defaults in 2010.
Distressed exchanges -- another top reason for default in 2010-
followed with 11 defaults in 2011. Of the remaining defaults, two
issuers failed to finalize refinancing on bank loans, two were
subject to regulatory action, one had its banking license revoked
by its country's central bank, one was appointed a receiver, and
two were confidential.
* S&P's Weakest Links Count Declines to 128
-------------------------------------------
The number of global weakest links decreased to 128 as of July 23
from 129 as of June 18, said an article published by Standard &
Poor's Global Fixed Income Research, titled "Global Weakest Links
and Default Rates: Weakest Links Count Decreases to 128." Weakest
links are issuers rated 'B-' and lower with either negative
outlooks or ratings on CreditWatch with negative implications.
The 128 weakest links have total rated debt worth $206 billion.
"The U.S. has the highest number of weakest links with 76, or
59.4% of the global total," said Diane Vazza, head of Standard &
Poor's Global Fixed Income Research. "By sector, the media and
entertainment, forest products and building materials, and metals,
mining, and steel sectors have the greatest concentrations of
weakest links. "Forty-nine issuers have defaulted so far in 2012
(through July 23), including confidential entities. These
defaulted issuers have outstanding debt worth $47.5 billion.
In comparison, 53 defaulted issuers had combined outstanding debt
worth $87.7 billion in 2011, 82 issuers defaulted on debt worth
$97.5 billion in 2010, and 264 issuers defaulted on debt worth
$627.7 billion in 2009.
The 12-month-trailing global corporate speculative-grade default
rate rose to 2.46% in June from 2.36% in May. Regionally, the
U.S. corporate speculative-grade default rate increased to 2.7%
from 2.64%, while the European speculative-grade default rate
increased to 2.44% from 2.16% and the emerging markets
speculative-grade default rate increased to 1.7% from 1.56%.
The U.S. economy grew at an annualized rate of 1.5% in second-
quarter 2012, compared with 2% in the first quarter.
In the U.S., 21 new speculative-grade deals came to market in July
(through July 23), compared with 24 deals in June and 39 deals in
May. The U.S. speculative-grade spread began to increase at the
beginning of August 2011 because of growing uncertainty in the
global financial markets, and it peaked at 830 basis points (bps)
as of Oct. 4, 2011, before declining steadily to 594 bps as of
March 19, 2012. By the end of June, the spread had widened to 685
bps, before narrowing slightly to 682 bps as of July 17.
S&P's baseline forecast (with a 60% probability) is for a 12-
month-forward (March 2013) corporate speculative-grade default
rate of 3.6% in the U.S. To realize the mean baseline projection,
a total of 55 speculative-grade-rated issuers would need to
default in the next 12 months. This implies an average of about
4.6 defaults per month -- higher than the average of about 4.2
defaults per month in the last six months.
S&P's optimistic default rate forecast assumes that the U.S.
economy and financial markets will perform better than expected,
and Europe will come to a speedy resolution regarding its
sovereign credit crisis. As a result, S&P would expect the
default rate to be slightly below the current level, or 2% by
March 2013 (31 defaults during the next 12 months).
"The 12-month-trailing default rate for U.S. leveraged loans
(based on the number of loans) increased to 1.08% in June 2012
from 0.92% in May 2012," said Ms. Vazza. "This is the highest
rate since the 1.21% recorded in July 2011, according to Standard
& Poor's Leveraged Commentary & Data (LCD)."
* Appreciation In Exempt Property Belongs to Trustee
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
that appreciation in the value of an asset above the amount
claimed as exempt belongs to the bankruptcy trustee, not to the
individual bankrupt, as a result of the 2010 decision by the U.S.
Supreme Court in Schwab v. Reilly.
According to the report, the case arose in Pennsylvania where an
individual bankrupt owned real property where there was an oil and
gas lease. No well had been drilled when the individual filed
Chapter 7 bankruptcy. In his schedule of assets, the bankruptcy
listed the real estate as being worth $4,250 and the lease as
having a value of $1. Using a so-called wildcard exemption in
Section 522(d)(5) of the Bankruptcy Code, he claimed they were
exempt in the amount of $4,250 and $1. Neither the trustee nor
any creditor objected to the exemptions. Instead, the bankruptcy
trustee filed a motion to close the case and declare that the
lease wasn't abandoned, so the trustee could recover the value of
the lease if a well were drilled. The bankrupt individual
objected to the trustee's effort and lost. On appeal, the
district court affirmed, ruling that appreciation in the value of
the lease above $1 belongs to the trustee.
According to the report Circuit Judge Ruggero V. Aldisert
affirmed, holding for the U.S. Court of Appeals in Philadelphia
that the result was controlled by Schwab because the bankrupt only
claimed a dollar amount of the exemption and didn't attempt to say
that he was claiming the "full" or "100 percent" interest in the
lease. Concluding that the bankrupt was entitled only to exempt a
$1 interest in the lease, Judge Aldisert said it was "easily
decided" that the appreciation belongs to the trustee. The
opinion didn't deal with the question of whether the trustee's
interest in the lease would ever terminate.
Mr. Rochelle notes that the opinion means that title companies and
purchasers of property from someone who was ever bankrupt must
carefully analyze all papers filed in the bankruptcy to determine
if the trustee has an interest in the property not shown on land
records. The problem could have been avoided if a bankrupt's
lawyer had utilized the language specified in the Schwab opinion
to indicate the bankrupt's intention to claim the full value of
the property.
The case is In re Orton, 11-4157, U.S. 3rd Circuit Court of
Appeals (Philadelphia)
* Sales Taxes Never Are Dischargeable
-------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
the U.S. Court of Appeals in Philadelphia became the fourth
federal circuit court to rule that sales taxes collected by a
retailer from customers are trust fund taxes rather than excise
taxes. Circuit Judge Thomas M. Hardiman looked at Section
507(a)(8)(C) and (E) of the Bankruptcy Code. Like three circuit
courts before, he concluded that the statute alone is ambiguous.
Unlike the other circuit courts, he held that the legislative
history was "indefinite."
Mr. Rochelle notes that the opinion by Judge Hardiman is important
because trust fund taxes never are dischargeable in the bankruptcy
of an individual responsible for the taxes. If sales taxes were
excise taxes, they would be dischargeable if more than three years
old.
The other circuit courts to reach the same result are in New York,
San Francisco and Cincinnati. The case is In re Calabrese,
11-3793, U.S. 3rd Circuit Court of Appeals (Philadelphia).
* Commercial Bankruptcies in July Down 26%, Says Epiq Systems
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist at Bloomberg News, reports
the 4,500 commercial bankruptcies in July were the fewest since
January 2008, while bankruptcies of all types last month were the
third fewest since January 2009. July's commercial bankruptcies
were 26 percent fewer than the same month last year.
According to the report, with 97,100 total bankruptcies in July,
filings year-to date are 13% below the comparable period in 2011,
according to data compiled from court records by Epiq Systems Inc.
July's total bankruptcies were 16.1% fewer than the same month
last year.
The report relates Chapter 11 filings, where larger companies
reorganize or sell assets, numbered below 800 in July,
representing the second fewest in 2012. Annualized, the 6,100
Chapter 11s so far this year are trending 8.5% below 2011. There
have been about 729,000 total bankruptcies through the end of
July, Epiq reported. If the filing rate continues, total
bankruptcies this year would come in 9% below the 2011 total of
1.38 million.
The report notes that last year, bankruptcies were 11.7% fewer
than the 1.56 million in 2010, which recorded the most
bankruptcies since the all-time record of 2.1 million set in 2005.
Year-to-date, bankruptcies of all types declined in all 50 states.
The states with the most filings per capita were Nevada, Tennessee
and Georgia.
The Bloomberg report discloses in 2005, Americans were filing for
bankruptcy in advance of new laws making it more difficult for
individuals to cancel debt. In the last two weeks before the law
changed, 630,000 Americans sought bankruptcy protection.
* Andrew D. Shaffer Joins Butzel Long's New York Office
-------------------------------------------------------
Andrew D. Shaffer Joins Butzel Long's New York Office as
Shareholder Shaffer Specializes in Bankruptcy and Restructuring
Andrew D. Shaffer, an attorney who concentrates his practice on
bankruptcy and restructuring, has joined the law firm Butzel Long
as a Shareholder in its New York office. Before joining Butzel
Long, Shaffer was a Partner at Mayer Brown.
For the past 12 years he has represented creditors in United
States bankruptcy proceedings as well as liquidations and
rehabilitations of banks, brokers, future commission merchants and
insurance companies.
Shaffer has also represented clients on transactional matters
including mergers, acquisitions, entity creation and the structure
of debt instruments. He counsels clients on the choice of
transactional structures that maximize their legal rights and
remedies when an obligor becomes subject to bankruptcy or similar
proceedings.
"Andrew's extensive experience in bankruptcy and restructuring is
a valuable addition to our premier bankruptcy practice as we
continue moving forward in achieving our clients' goals," said
Richard Brosnick, Managing Partner of Butzel Long's New York
office.
Shaffer is a member of the American Bankruptcy Institute, the
International Association of Insurance Receivers, INSOL
International, the American Bar Association and the New York City
Bar Association.
About Butzel Long
Butzel Long -- http://www.butzel.com/-- was established in 1854
and is headquartered in Detroit. Butzel Long is one of America's
leading law firms, with 140 attorneys and offices in Michigan, New
York City, Washington D.C., Mexico and China. The firm represents
clients from diverse industries on a regional, national and multi-
national level and is the sole Michigan member of Lex Mundi, a
global association of 160 independent law firms.
* Futures Insurance Seen as Band-Aid for Brokerage Failures
-----------------------------------------------------------
Ian Thoms at Bankruptcy Law360 reports that U.S. lawmakers are
weighing whether to establish an insurance fund for futures
customers similar to those available for securities investors and
bank depositors, but experts say the move, while welcome, would do
little to address the lapses that led to the failures of MF Global
Inc. and Peregrine Financial Group Inc.
Bankruptcy Law360 relates that during a hearing Wednesday,
senators questioned why futures customers lacked the type of
insurance protection offered to securities investors through the
Securities Investor Protection Corp. and bank depositors through
the Federal Deposit Insurance Corp.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
November 1-3, 2012
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Westin Copley Place, Boston, Mass.
Contact: http://www.turnaround.org/
Nov. 29 - Dec. 2, 2012
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
Contact: 1-703-739-0800 ;
http://www.abiworld.org/
April 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
October 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. 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, Ivy B. Magdadaro, 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 ***