/raid1/www/Hosts/bankrupt/TCR_Public/121015.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, October 15, 2012, Vol. 16, No. 287
Headlines
1220 SOUTH: Meeting of Creditors Continued to Oct. 31
1220 SOUTH: Has Interim OK to Employ Rappaport as General Counsel
ADVANCED COMPUTER: Has Access to Cash Collateral Until Dec. 31
ALION SCIENCE: Sells $1.1 Million Common Shares to ESOP Trust
ARCAPITA BANK: Court Extends Plan Filing Deadline to Dec. 14
ARCAPITA BANK: Milbank Representing Creditors Committee
ASTORIA GENERATING: S&P Assigns 'B-' Corporate Credit Rating
ATP OIL: Has Final Court OK on Jefferies as Investment Banker
ATP OIL: Creditors Committee Taps Milbank as Lead Counsel
ATP OIL: Court Approves Opportune LLP as Financial Advisors
ATP OIL: Court Approves Mayer Brown & Munsch Hardt Hirings
BACHRACH CLOTHING: Court Rejects Suit to Invalidate 2005 Sale
BERRY PLASTICS: Appoints Former Goldman Sachs Executive to Board
BMB MUNAI: Declares Second Distribution of $0.30 Per Share
BRAND ENERGY: S&P Assigns 'CCC+' Rating on $325-Mil. Term Loan
CAESARS ENTERTAINMENT: Satisfies Escrow Conditions Under Offering
CATHOLIC DIOCESE OF SPOKANE: Sues Bankruptcy Counsel
CELL THERAPEUTICS: Tang Capital Discloses 9.9% Equity Stake
CEQUEL COMMUNICATIONS: S&P Rates Proposed $500MM Senior Notes 'B-'
CHINA MEDICAL: Judge Grants Protection From U.S. Creditors
CHRIST HOSPITAL: McKesson Opposes Assumption of Software License
CITYCENTER HOLDINGS: Fitch Keeps B- Rating on 2nd Lien Sec. Notes
COMMUNITY HOME: Judge Holds Key Motions in Abeyance
COMPOSITE TECHNOLOGY: Wants Plan Filing Period Extended to Dec. 7
COMSTOCK MINING: Longview Fund Discloses 5.3% Equity Stake
COPYTELE INC: Denis Krusos Resigns from Board of Directors
COVENTRY FIRE DEP'T: In Receivership After Budget Voted Down
CRAZY HORSE: Centerfold Cabaret Files for Chapter 11 Bankruptcy
CUBIC ENERGY: Tauren Settles Dispute with EXCO & BG
DEWEY & LEBOEUF: Wants Committee of Former Partners Disbanded
DEWEY & LEBOEUF: CRO Thinks Case Won't Be Converted to Chapter 7
DEWEY & LEBOEUF: Criminal Probe Gains Steam But Hurdles Remain
DIGITAL DOMAIN: Asks West Palm to Waive Right to Sue Company
DISTHENE GROUP: High Court Rejects Bid to Halt Liquidation
DUNE ENERGY: Whitebox Advisors Discloses 5.5% Equity Stake
EASTMAN KODAK: Oct. 29 Hearing on Accord to End Retiree Benefits
ECOSPHERE TECHNOLOGIES: Barbara Carabetta Appointed Interim CFO
EGPI FIRECREEK: Brandon Ray Resigns for Personal Reasons
ELEPHANT TALK: Five Directors Elected to Board
EL PASO'S FEDERAL: NCUA Placed EPFCU Into Liquidation
EMISPHERE TECHNOLOGIES: 13% Default Interest Rate Applies
ENERGY XXI: S&P Hikes $1BB Note Rating to B+ on Recovery Prospects
F1 SPEEDWAY: Is Insolvent; To Liquidate Assets
FUEL DOCTOR: Had $296,300 Net Loss in Second Quarter
FUELSTREAM INC: Obtains $423,000 Financing from Investor
GENELINK INC: Jon Marshall Discloses 13% Equity Stake
GEOPETRO RESOURCES: Has Until Dec. 31 to Regain NYSE Compliance
GLYECO INC: To Buy Glycol-Related Assets of ARI, Renew Resources
GULFPORT ENERGY: S&P Assigns 'B-' CCR; Rates $250MM Notes 'CCC+'
HD SUPPLY: Intends to Redeem $930-Mil. of Sr. Subordinated Notes
HEMCON MEDICAL: Can Obtain Financing to Finance Premiums Payment
HEMCON MEDICAL: Final Hearing on Access to Cash Set for Oct. 18
HEMCON MEDICAL: Final Hearing on Disclosures Reset to Oct. 18
HOSTESS BRANDS: Files Plan of Reorganization
HUDSON VALLEY HOTEL: Former Clarion Hotel Files Chapter 11
HYLAND SOFTWARE: S&P Lowers CCR to 'B' on Debt Refinancing
IMS HEALTH: S&P Cuts Corp. Credit Rating to 'B+'; Outlook Stable
INFUSYSTEM HOLDINGS: Amends Employment Pact with CEO, President
INSIGHT GLOBAL: S&P Cuts CCR to 'B' on Ares Acquisition Plan
ISE CORPORATION: District Court Rejects Maxwell Appeals
JHK INVESTMENTS: Files Schedules of Assets and Liabilities
LUMBER PRODUCTS: Trustee Employs Capacity Commercial as Broker
LUMBER PRODUCTS: Trustee Hiring CLA as Auditor to Audit ESOP
MACROSOLVE INC: 3 Directors Quit; Names Executives for Next Year
MARINA BIOTECH: Had $29.4MM Loss in 2011, May File for Bankruptcy
MARKET STREET: Confirmation Hearing Continued to Oct. 16
MEHR IN LOS ANGELES: Case Summary & 13 Unsecured Creditors
METRO FUEL: Contemplates Sale of Various Assets
MGM RESORTS: Fitch Affirms 'B-' IDR; Outlook Positive
MMRGLOBAL INC: Expands Health IT Patent Portfolio
MOHEGAN TRIBAL: Files Statistical Report for Mohegan Sun
MOMENTIVE PERFORMANCE: S&P Gives 'CCC+' Rating on $1.1BB Sr. Notes
MOTORSPORT RANCH: U.S. Trustee Unable to Form Creditors' Committee
MOUNTAIN EDGE: Subdivision Declared as "Single Asset Real Estate"
NATIONAL HOLDINGS: Two Directors Appointed to Board
NATIVE WHOLESALE: Can Post $2-Mil Collateral to Secure Bonds
NET ELEMENT: Kenges Rakishev Holds 27.1% Equity Stake in NETE
NIFTUS LLC: U.S. Trustee Wants Case Converted to Chapter 7
NTELOS HOLDINGS: S&P Rates $475MM Sr. Secured Term Loan 'BB-'
OAKS AT PARK SOUTH APARTMENTS: Ginkgo Appointed as Receiver
ODYSSEY PICTURES: P. Rodgers Succeeds M. Cronin as Accountant
OLDE PRAIRIE: CenterPoint Asks Court to Dismiss Chapter 11 Case
PENNFIELD CORP: Schedules Filing Deadline Extended to Nov. 6
PENNFIELD CORP: Sec. 341 Creditors' Meeting Set for Nov. 8
PINNACLE AIRLINES: Pilots Assoc. Objects to Motion on CBA
PQ CORP: S&P Affirms 'B' CCR; Outlook Revised on Debt Refinancing
PRECISION OPTICS: Austin Marxe Discloses 30.5% Equity Stake
REALOGY CORP: S&P Hikes CCR to 'B' on IPO and Debt Conversion
RENT-A-CENTER INC: S&P Ups CCR to 'BB+' on Improved Credit Ratios
SEARS HOLDINGS: Rights Offering Expires; 95% Shares Subscribed
SIERRA NEGRA: Hiring Fair Anderson as Accountants
SIERRA NEGRA: Hiring Withey Morris as Special Real Estate Counsel
SIERRA NEGRA: Amends Schedules of Assets and Liabilities
SOLYNDRA LLC: Investors Sought Tax Break Prior to Bankruptcy
SOLYNDRA LLC: Unite Here Opposes Bankruptcy Plan
SPANISH BROADCASTING: Fails to Comply with Market Value Rule
SPRINT NEXTEL: S&P Puts 'B+' CCR on Watch Pos on Softbank Talks
STAFFORD RHODES: Creditors to Appeal Order Denying Case Dismissal
STEREOTAXIS INC: Wellington Management Does Not Own Common Shares
SUNAC CHINA: Fitch Assigns 'BB-' Final Rating on $400-Mil. Notes
TEN SAINTS: Hiring Kenneth Wiles as Interest Rate Expert
TRANS-LUX CORP: Gabelli Funds Discloses 47.1% Equity Stake
TRIUS THERAPEUTICS: To Sell $3.5-Mil. Common Shares to Terrapin
VANITY EVENTS: Phil Ellett Named Chairman, CEO, CFO and Director
VANN'S INC: To Liquidate in Chapter 7
VERENIUM CORP: Inks $10 Million Credit Agreement with Comerica
VERTIS HOLDINGS: Has Interim Approval of $150MM GECC DIP Loan
VIASPACE INC: Delivers 80% of Outstanding Shares to Changs
WOLVERINE WORLD: S&P Assigns 'BB-' Corporate Credit Rating
* BOND PRICING: For The Week From Oct. 8 to 12, 2012
*********
1220 SOUTH: Meeting of Creditors Continued to Oct. 31
-----------------------------------------------------
A notice of continued meeting of creditors was filed by Debtor
1220 South Ocean Boulevard, LLC. The meeting of creditors will be
held on Oct. 31, 2012, at 1:00 p.m., at 1515 North Flagler Drive,
Room 870, in West Palm Beach, Florida.
About 1220 South Ocean
1220 South Ocean Boulevard, LLC, filed a Chapter 11 petition
(Bankr. S.D. Fla. Case No. 12-32609) in its home-town in West Palm
Beach, Florida. The Debtor disclosed $74 million in total assets
and $41.5 million in liabilities as of Sept. 7, 2012.
According to http://1220southocean.com/1220 South Ocean is a
French-inspired waterfront estate homes and resort located in Palm
Beach. Owned by real estate developer Dan Swanson, president of
Addison Development, 1220 South Ocean sits on 2.5 private and
secure acres of land, has 20,000 square feet of living plus an
additional 7,000 square feet of loggias, garages & guest house.
The resort is located four miles to Palm Beach International
Airport. Mr. Swanson other developments include the Phipps
Estates in Palm Beach and Addison Estates at the Boca Hotel.
Judge Erik P. Kimball oversees the case. Kenneth S. Rappaport,
Esq., at Rappaport Osbourne & Rappaport, in Boca Raton, Florida,
serves as counsel to the Debtor.
1220 SOUTH: Has Interim OK to Employ Rappaport as General Counsel
-----------------------------------------------------------------
Judge Erik P. Kimball has granted 1220 South Ocean Boulevard, LLC,
interim authorization to employ Kenneth S. Rappaport and the law
firm of Rappaport Osbourne & Rappaport, PL, as general counsel for
the Debtor, nunc pro tunc to Sept. 21, 2012. The Court will
conduct a final hearing on the application on Oct. 18, 2012, at
1:30 p.m.
The Debtor will look to Rappaport to, among other things,
represent the Debtor in negotiation with its creditors in the
preparation of a plan.
Mr. Rappaport, Esq., attests that his firm is disinterested as
required by 11 U.S.C. Sec. 327(a).
About 1220 South Ocean
1220 South Ocean Boulevard, LLC, filed a Chapter 11 petition
(Bankr. S.D. Fla. Case No. 12-32609) in its home-town in West Palm
Beach, Florida. The Debtor disclosed $74 million in total assets
and $41.5 million in liabilities as of Sept. 7, 2012.
According to http://1220southocean.com/1220 South Ocean is a
French-inspired waterfront estate homes and resort located in Palm
Beach. Owned by real estate developer Dan Swanson, president of
Addison Development, 1220 South Ocean sits on 2.5 private and
secure acres of land, has 20,000 square feet of living plus an
additional 7,000 square feet of loggias, garages & guest house.
The resort is located four miles to Palm Beach International
Airport. Mr. Swanson other developments include the Phipps
Estates in Palm Beach and Addison Estates at the Boca Hotel.
Judge Erik P. Kimball oversees the case. Kenneth S. Rappaport,
Esq., at Rappaport Osbourne & Rappaport, in Boca Raton, Florida,
serves as counsel to the Debtor.
ADVANCED COMPUTER: Has Access to Cash Collateral Until Dec. 31
--------------------------------------------------------------
Advanced Computer Technology, Inc., and Banco Bilbao Vizcaya
Argentaria Puerto Rico ask the U.S. Bankruptcy Court for the
District of Puerto to approve a stipulation granting the Debtor
limited use of BBVA's cash collateral through the confirmation of
Debtor's Plan or Dec. 31, 2012, whichever is earlier.
The Debtor agrees that BBVA holds a valid and continuous pre- and
post- petition lien on the Debtor's accounts receivable and
certain office equipment.
The Debtor will be authorized to use BBVA's cash collateral solely
to satisfy permitted expenditures set forth and described in the
budget.
As initial adequate protection, the Debtor proposes to grant BBVA
a replacement lien and a postpetition security interest on all of
the assets and collateral acquired by the Debtor after the
Petition Date up to the amount of BBVA's cash collateral used by
Debtor after the Petition Date, to the same extent and priority,
and on the same type of property, as BBVA's liens and security
interests in the pre-petition collateral. The Debtor will also
pay BBVA, as the monthly payment due to BBVA under the loan
documents, the sum of $2,000 per month.
The Debtor and BBVA agree for the Court to order the turnover of
the funds deposited in favor of Debtor in Civil Case Number
KCD2004-0604 ($262,308) and in Civil Case Number KAC2009-1257
($692,340) in order for those funds to be deposited with the Clerk
of the Bankruptcy Court and for the Court to determine the extent
and priority of any liens thereon.
About Advanced Computer
San Juan, Puerto Rico-based Advanced Computer Technology, Inc.,
filed a Chapter 11 petition (Bankr. D.P.R. Case No. 12-04454) in
Old San Juan on June 6, 2012. The Debtor, an information system
consulting firm, disclosed $10.34 million in assets and $6.176
million in liabilities in its schedules. It said software and
licenses rights are worth $6.30 million. The value of its 100%
ownership of Sprinter Solutions, Inc., is unknown.
Debtor's only shareholder is Investigacion Y Programas, S.A.
("IPSA"). Debtor's president is Jaime Romano and its secretary
and chief executive officer is Osvaldo Karuzic, none of whom hold
any shares in Debtor.
Bankruptcy Judge Brian K. Tester presides over the case. Charles
Alfred Cuprill, Esq., at Charles A. Cuprill, PSC Law Offices, in
San Juan, P.R., serves as Debtor's counsel.
William Santiago-Satre, Esq., at De Diego Law Offices, in
Carolina, P.R., represents Banco Bilbao Vizcaya Argentaria Puerto
Rico as counsel.
ALION SCIENCE: Sells $1.1 Million Common Shares to ESOP Trust
-------------------------------------------------------------
Alion Science and Technology Corporation sold $1.1 million worth
of its common stock to the Alion Science and Technology
Corporation Employee Ownership, Savings and Investment Trust. The
price per share to be ascribed to the common stock for this sale
was determined in a valuation of Alion common stock performed as
of Sept. 30, 2012.
The trustee of the ESOP Trust, State Street Bank & Trust Company,
has engaged an independent third-party valuation firm to assist in
establishing a value for Alion's common stock as of Sept. 30,
2012. Management expects the valuation to be completed by Nov. 8,
2012.
The shares of common stock were sold pursuant to an exemption from
registration under Section 4(2) of the Securities Act of 1933, as
amended.
About Alion Science
Alion Science and Technology Corporation, based in McLean,
Virginia, is an employee-owned company that provides scientific
research, development, and engineering services related to
national defense, homeland security, and energy and environmental
analysis. Particular areas of expertise include communications,
wireless technology, netcentric warfare, modeling and simulation,
chemical and biological warfare, program management.
The Company reported a net loss of $44.38 million for the year
ended Sept. 30, 2011, compared with a net loss of $15.23 million
during the prior year.
The Company's balance sheet at June 30, 2012, showed
$640.23 million in total assets, $779.47 million in total
liabilities, $112.70 million in redeemable common stock,
$20.78 million in common stock warrants, $123,000 in accumulated
other comprehensive loss, and a $272.61 million accumulated
deficit.
* * *
As reported by the TCR on Sept. 8, 2011, Standard & Poor's Ratings
Services lowered its corporate credit rating on McLean, Va.-based
Alion Science and Technology Corp. to 'CCC+' from 'B-'. The
rating outlook is negative.
"The downgrade of Alion is a result of the company's recent
operational weakness," said Standard & Poor's credit analyst
Alfred Bonfantini, "and the prospect of further pressure on
revenues, which stem from the continuing resolution on the 2011
Federal government budget that wasn't settled until April 2011,
the subsequent specter of a U.S. government default during the
debt ceiling debate, and the ongoing uncertainty over future
budget cuts and levels."
In the Sept. 26, 2012, edition of the TCR, Moody's Investors
Service has lowered the ratings of Alion Science and Technology
Corporation including its Corporate Family Rating ("CFR") to Caa2
from Caa1 due to the high likelihood that the company will need do
a debt refinancing over the next twelve to eighteen months.
ARCAPITA BANK: Court Extends Plan Filing Deadline to Dec. 14
------------------------------------------------------------
Joseph Checkler at Dow Jones Newswires reported that Bankruptcy
Judge Sean H. Lane last week gave Arcapita Bank until Dec. 14,
2012, to file a reorganization plan without the threat of rival
proposals, with the understanding that the company won't seek
further extensions after that date.
The report says Judge Lane's approval came after an Arcapita
lawyer said an objection from Arcapita's official committee of
unsecured creditors had been satisfied.
According to the report, Gibson Dunn & Crutcher LLP's Michael A.
Rosenthal said Arcapita is still exploring both a standalone plan
and one that involves new money from a third party. Mr. Rosenthal
said that if Arcapita doesn't file a plan by December and get it
before the court for approval by the first quarter of 2013,
"exclusivity will lapse."
The report notes a group of hedge funds owning or managing
nearly $200 million in Arcapita debt continued to object to the
extension, saying they wanted to be included in any reorganization
discussions the company has. When a lawyer for the creditors
committee wasn't prepared to agree to that, a lawyer for the hedge
funds said the objection stood. Judge Lane then issued his
ruling, saying extending the exclusive period was appropriate.
The report adds the three hedge funds that hold or manage $195
million of $1.1 billion in Sharia-compliant financing issued in
2007 -- including an affiliate of Arcapita's potential post-
bankruptcy lender -- had objected to the extension on several
grounds, including calling the search for new capital a "fool's
errand."
The report relates Silver Point Capital LP, Taconic Capital
Advisors LP and York Capital Management Global Advisors LLC said
in court papers that Arcapita doesn't need the extra time because
it has already drafted a restructuring plan that it should be able
to file.
The report says the hedge funds are accusing Arcapita -- which
manages real estate, infrastructure, private equity and venture-
capital investments that are compliant with Islamic Sharia law --
of instead trying to buy time to search for new capital to ensure
its continued operations and stave off the liquidation of its
holdings around the world.
According to the report, to ensure it is able to protect the value
of its investments during the restructuring, Arcapita has sought
post-bankruptcy financing. It is currently working to finalize a
$150 million commitment from none other than Silver Point
Capital's lending arm, Silver Point Finance LLC. That loan,
however, seems anything but certain now.
The report says the Silver Point Finance package wouldn't be a
traditional loan because it would be compliant with Sharia, which
means it would be structured to avoid Islamic law's general ban on
borrowing money with interest.
According to the report, Arcapita and the creditors committee
argued over the proposed financing package. Arcapita is seeking
Judge Lane's approval to pay Silver Point a commitment fee for the
loan.
The report says Judge Lane indicated he would probably reject the
fee payment to Silver Point, which would have essentially halted
the loan. So instead of ruling, he asked the company and the
creditors to work out a timetable on seeking a new loan or one
with different terms. The judge said he thought Silver Point
could back out of the loan too easily.
About Arcapita Bank
Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on
March 19, 2012. The Debtors said they do not have the liquidity
necessary to repay a US$1.1 billion syndicated unsecured facility
when it comes due on March 28, 2012.
Falcon Gas Storage Company, Inc., later filed a Chapter 11
petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012.
Falcon Gas is an indirect wholly owned subsidiary of Arcapita
that previously owned the natural gas storage business NorTex Gas
Storage Company LLC. In early 2010, Alinda Natural Gas Storage
I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural
Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.)
acquired the stock of NorTex from Falcon Gas for $515 million.
Arcapita guaranteed certain of Falcon Gas' obligations under the
NorTex Purchase Agreement.
The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins
LLP as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.
Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.
Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank. Arcapita is not a domestic bank licensed in the United
States. Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain. The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition
to its Bahrain headquarters. The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.
The Arcapita Group has roughly US$7 billion in assets under
management. On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion. The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.
Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.
Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from
the Grand Court of the Cayman Islands with a view to facilitating
the Chapter 11 cases. AIHL sought the appointment of Zolfo
Cooper as provisional liquidator.
ARCAPITA BANK: Milbank Representing Creditors Committee
-------------------------------------------------------
The newly minted Official Committee of Unsecured Creditors of
Arcapita Bank B.S.C.(c), et al. is being represented by:
Dennis F. Dunne, Esq.
Abhilash M. Raval, Esq.
Evan R. Fleck, Esq.
MILBANK, TWEED, HADLEY & McCLOY LLP
1 Chase Manhattan Plaza
New York, NY 10005
Telephone: (212) 530-5000
Facsimile: (212) 530-5219
E-mail: ddunne@milbank.com
araval@milbank.com
efleck@milbank.com
- and -
Andrew M. Leblanc, Esq.
MILBANK, TWEED, HADLEY & McCLOY LLP
1850 K Street, NW, Suite 1100
Washington, DC 20006
Telephone: (202) 835-7500
Facsimile: (202) 263-7586
E-mail: aleblanc@milbank.com
BankruptcyData.com reports that the Creditors Committee filed with
the U.S. Bankruptcy Court applications to retain
(a) Porter Hedges (Contact: Robert J. Moore) as attorney at
these hourly rates:
* Partner at $825 to $1,140
* Of counsel at $795 to $995
* Associate at $295 to $795
* legal assistant at $130 to $290
(b) Milbank Tweed Hadley & McCloy (Contact: James Matthew
Vaughn) as attorney at these hourly rates:
* partner at $395 to $650
* of counsel at $410 to $435
* associate and staff attorney at $210 to $400
* paralegal and law clerk at $130 to $210.
Tracy Hope Davis, the United States Trustee for Region 2, under 11
U.S.C. Sec. 1102(a) and (b), appointed seven members to the
Committee. The members are:
1. Euroville S.….r.l.
13 rue Edward Steichen, L-2540
Luxembourg
Attention: Tim Babich and Pushkar Acharya
Fortelus Capital Management
82 Pall Mall
London SW1Y SES, United Kingdom
Tel: +44 (0) 20 7389 6150; +44 (0) 20 7389 6151
Fax: +44 (0) 20 7389 6160
E-mail: tbabich@fortelus.com
pacharya@fortelus.com
2. National Bank of Bahrain BSC
P.O. Box 106
Manama Gov't Avenue
Bahrain
Attention: Raveendra Krishnan, General Manager Risk Group
Telephone: 17205652 (direct); 17228800, ext. 5652
Fax: 17505203
E-mail: raveendra.krishnan@nbb.com.bh
3. Commerzbank AG
Gallusanlage 7
60329 Frankfurt Am Main
Germany
Telephone: +496913622864 and +496913649229
Fax: +496913629477
E-mail: joachim.ballerstaedt@commerzbank.com
beand.nitche@commerzbank.com
4. VR Global Partners, L.P.
400 Madison Avenue, 15th Floor
New York, NY York 10017
Attention: Peter Clateman, Chief Legal Officer
Tel: (646) 571-1870
Fax: (646) 571-1879
E-mail: pclateman@vrcapital.com
5. Barclays Bank PLC
200 Park Avenue
New York, NY 10066
Attention: Amy McClean, Director
Tel: (212) 412-3403
Fax: (212) 412-5660
6. Central Bank of Bahrain
P.O. Box 27, Diplomatic Area
Manama, Kingdom of Bahrain
Attention: Mr. Ashley Freeman
Mr. Khalid Hamad, Executive Director
Tel: +973 17547531
E-mail: ashley@cbb.gov.bh
7. Arcsukuk (2011-1) Limited
c/o BNY Mellon Corporate Trustee Services Limited
One Canada Square
London, E145AL.
United Kingdom
Attention: Zaira Jehangir, Vice President
Tel: +44 2079644981
E-mail: zairajehangir@bnymellon.com
About Arcapita Bank
Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on
March 19, 2012. The Debtors said they do not have the liquidity
necessary to repay a US$1.1 billion syndicated unsecured facility
when it comes due on March 28, 2012.
Falcon Gas Storage Company, Inc., later filed a Chapter 11
petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012.
Falcon Gas is an indirect wholly owned subsidiary of Arcapita
that previously owned the natural gas storage business NorTex Gas
Storage Company LLC. In early 2010, Alinda Natural Gas Storage
I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural
Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.)
acquired the stock of NorTex from Falcon Gas for $515 million.
Arcapita guaranteed certain of Falcon Gas' obligations under the
NorTex Purchase Agreement.
The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins
LLP as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.
Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.
Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank. Arcapita is not a domestic bank licensed in the United
States. Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain. The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition
to its Bahrain headquarters. The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.
The Arcapita Group has roughly US$7 billion in assets under
management. On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion. The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.
Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.
Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from
the Grand Court of the Cayman Islands with a view to facilitating
the Chapter 11 cases. AIHL sought the appointment of Zolfo
Cooper as provisional liquidator.
ASTORIA GENERATING: S&P Assigns 'B-' Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'B-'
corporate credit rating to Astoria Generating Co. Acquisitions LLC
(Astoria Gen). "At the same time, we assigned a preliminary 'B'
issue rating to the proposed $450 million first-lien credit
facility consisting of a $425 million term loan due 2018 and a $25
million revolving facility due 2017 with a recovery rating of '2'.
The '2' rating indicates a substantial recovery (70% to 90%) if a
default occurs. The outlook is positive," S&P said.
"Astoria Gen is refinancing its existing first-lien and second-
lien credit facilities, consisting of a $430 million ($99 million
outstanding) term loan and a $60 million ($57 million drawn)
working capital facility, both due February 2013, and $300 million
($300 million outstanding) term bank loan due August 2013, with a
new $450 million first-lien credit facility consisting of a $425
million term loan due 2018 and a $25 million working capital
facility due 2017. The parent, USPG, will make an equity
contribution of $15 million and Astoria Gen will use about $53.5
million of its available cash to fund the transaction," S&P said.
"The positive outlook reflects our view that the company's cash
flow will benefit from recent regulatory outcomes and our
expectation that its credit metrics will likely improve if FERC
approves the LCR of 85.4%," said Standard & Poor's credit analyst
Trevor D'Olier-Lees.
"Under such a scenario, we expect that the adjusted debt to EBITDA
will improve to 4.5x for 2013 and below 3.5x for 2014. Adjusted
FFO to debt will be 12% in 2013 and above 18% for 2014, producing
credit metrics in the 'aggressive' category. Moreover, management
will need to achieve at least half of the anticipated costs
savings in order to produce credit metrics in line with our
expectation. We could revise the outlook to stable if the LCR is
approved at the current 83%. We may lower the rating if liquidity
weakens due to lower capacity prices, higher-than-expected O&M
expenses, or poor operating performance," S&P said.
ATP OIL: Has Final Court OK on Jefferies as Investment Banker
-------------------------------------------------------------
The U.S. Bankruptcy Court issued a final order authorizing ATP Oil
& Gas Corporation to employ Jefferies & Company, Inc., as
investment banker.
The bankruptcy judge then issued an amended order to provide that
Jefferies will be paid a transaction fee only for a transaction on
which it provided meaningful services to the estate and will be
paid a restructuring fee only with respect to a plan on which it
provided meaningful services to the estate.
Jefferies will provide financial and capital markets advisory
services to the Debtor, including without limitation:
(a) familiarizing with and analyzing, the business, operations,
properties, financial condition, and prospects of the Debtor;
(b) advising the Debtor on the current state of the "restructuring
market";
(c) assisting and advising the Debtor in developing a general
strategy for accomplishing a Restructuring;
(d) assisting and advising the Debtor in implementing a
Restructuring;
(e) assisting and advising the Debtor in evaluating and analyzing
a Restructuring, including the value of the securities or debt
instruments, if any, that may be issued in such Restructuring;
(f) rendering other financial advisory services as may from
time to time be agreed upon by the parties;
(g) providing the Debtor expert witness testimony concerning a
Restructuring, M&A Transaction, and/or DIP Financing, or any
other matters that fall within the scope of Jefferies'
services under the Engagement Letter;
(h) assisting in the development of financial data and
presentations to the Debtor's Boards of Directors, various
creditors, and other third parties;
(i) participating in negotiations among the Debtor and its
creditors, suppliers, and other interested parties; and
(j) advising the Debtor and negotiating with lenders with respect
to potential waivers or amendments of various credit
facilities.
As compensation for its services, Jefferies will receive:
(1) A monthly fee equal to $175,000 per month for the first three
months, beginning July 16, 2012, and $150,000 per month
thereafter until the expiration or termination of the
engagement;
(2) Restructuring Fee: Upon the consummation (including the
effective date of a Chapter 11 plan of reorganization or a
plan of liquidation) of a Restructuring or similar
transaction, a fee equal to $5,000,000;
(3) DIP Financing Fee: Upon the initial funding of a DIP
Financing, a fee equal to $1,000,000;
(4) Opinion Fee: Upon the delivery of an opinion (regardless of
the conclusion reached therein) a fee equal to 25% of the
Transaction Fee (calculated as if the M&A Transaction were
consummated on the date on which the Opinion Fee is payable),
subject to a minimum fee of $500,000 and a maximum fee of
$1,000,00. The fee will be credited, to the extent previously
paid, once against the Transaction Fee, if any, payable to
Jefferies by the Debtor in respect of the transaction to which
the opinion relates;
(5) Transaction Fee: Upon the closing of an M&A Transaction, a fee
equal to an amount to be determined according to the following
schedule:
(i) 1.50% of that portion of the Transaction Value (as such
term is defined in the Engagement Letter) less than or
equal to $250,000,000;
(ii) An additional 1.25% of that portion of the Transaction
Value greater than $250,000,000 and less than or equal
to $500,000,000;
(iii) An additional 1.00% of that portion of the Transaction
Value greater than $500,000,000 and less than or equal
to $1,000,000,000; and
(iv) An additional 0.80% of that portion of the Transaction
Value greater than $1,000,000,000.
Pursuant to the terms of the Engagement Letter, a separate
Transaction Fee will be payable in respect of each M&A
Transaction in the event that more than one M&A Transaction
will occur.
(6) In the event that Jefferies is entitled to both a Transaction
Fee and a Restructuring Fee, Jefferies shall be entitled to
the greater of the Transaction Fee or the Restructuring Fee
(after giving effect to the next sentence), and not both fees.
In addition, the aggregate fees paid to Jefferies under
subsections (a) through (c) of this paragraph shall not exceed
$7,500,000 in the aggregate.
(7) Expenses: In addition to any fees that may be paid to
Jefferies hereunder, the Debtor will reimburse Jefferies, upon
receipt of an invoice therefore, for all out-of-pocket
expenses (including reasonable fees and expenses of counsel,
and the reasonable fees and expenses of any other independent
experts retained by Jefferies with the prior written approval
of the Debtor) incurred by Jefferies and its designated
affiliates in connection with this engagement.
Jefferies attests it is a "disinterested person" as defined in
Sections 101(14) and 1107(b) of the Bankruptcy Code, and does not
hold or represent an interest adverse to the Debtor's estate that
would otherwise render Jefferies ineligible to serve as the
financial advisor for the Debtor pursuant to the provisions of
Section 327(a) of the Bankruptcy Code.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is
the conflicts counsel. Opportune LLP is the financial advisor
and Jefferies & Company is the investment banker. Kurtzman
Carson Consultants LLC is the claims and notice agent.
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
An official committee of unsecured creditors has been appointed in
the case.
ATP OIL: Creditors Committee Taps Milbank as Lead Counsel
---------------------------------------------------------
The Unsecured Creditors Committee in ATP Oil & Gas Corporation
filed papers with the U.S. Bankruptcy Court seeking formal
approval to retain Milbank, Tweed, Hadley & McCloy LLP as counsel,
effective as of Sept. 24, 2012.
The firm will, among other things:
(a) participate in in-person and telephonic meetings of the
Committee and any subcommittees formed thereby, and
otherwise advise the Committee with respect to its rights,
powers and duties in the Chapter 11 Case;
(b) assist and advise the Committee in its consultations,
meetings and negotiations with the Debtor and all other
parties in interest regarding the administration of the
Chapter 11 case; and
(c) assist the Committee in analyzing the claims asserted
against and interests asserted in the Debtor, in negotiating
with the holders of such claims and interests, and in
bringing, participating in, or advising the Committee with
respect to contested matters and adversary proceedings,
including objections or estimation proceedings, with respect
to such claims or interests.
The Committee has chosen Porter Hedges LLP to act as co-counsel
with Milbank in the Chapter 11 case. Milbank will act as lead
counsel to the Committee and, in consultation with the Committee,
will coordinate with PH to determine each firm's respective areas
of responsibility during the Chapter 11 Case.
Robert Jay Moore, Esq., a partner in Milbank's Financial
Restructuring Group, attests that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
Milbank intends to apply to the Court for payment of compensation
and reimbursement of expenses in accordance with applicable
provisions of the Bankruptcy Code. The standard hourly rates
charged by Milbank are:
Professional Rates
------------ -----
Partners $825 to $1,140
Counsel $795 to $995
Associates $295 to $795
Legal assistants $130 to $290
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is
the conflicts counsel. Opportune LLP is the financial advisor
and Jefferies & Company is the investment banker. Kurtzman
Carson Consultants LLC is the claims and notice agent.
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
An official committee of unsecured creditors has been appointed in
the case.
ATP OIL: Court Approves Opportune LLP as Financial Advisors
-----------------------------------------------------------
ATP Oil & Gas Corporation sought and obtained approval from the
U.S. Bankruptcy Court to employ Opportune LLP as financial
advisors. Opportune is authorized to perform any and all
financial advisory services for the Debtor that are necessary or
appropriate in connection with the Chapter 11 case. Opportune
will seek to avoid the duplication of any services provided by
Jefferies & company or any other professional retained in the
case.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is
the conflicts counsel. Opportune LLP is the financial advisor
and Jefferies & Company is the investment banker. Kurtzman
Carson Consultants LLC is the claims and notice agent.
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
An official committee of unsecured creditors has been appointed in
the case.
ATP OIL: Court Approves Mayer Brown & Munsch Hardt Hirings
----------------------------------------------------------
ATP Oil & Gas Corporation sought and obtained approval from the
U.S. Bankruptcy Court to employ Mayer Brown LLP as general
bankruptcy counsel.
ATP Oil also won permission to employ Munsch Hardt Kopf & Harr,
P.C. as conflict counsel. The firm's attorneys represent no
interest adverse to the Debtor's estate with respect to the
matters upon which they are to be engaged and are "disinterested
persons" within the meaning of that term under Sections 101(14)
and 1107(b) of the Bankruptcy Code.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Munsch Hardt Kopf & Harr, P.C., is
the conflicts counsel. Opportune LLP is the financial advisor
and Jefferies & Company is the investment banker. Kurtzman
Carson Consultants LLC is the claims and notice agent.
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
An official committee of unsecured creditors has been appointed in
the case.
BACHRACH CLOTHING: Court Rejects Suit to Invalidate 2005 Sale
-------------------------------------------------------------
Bachrach Clothing, Inc., lost in its bid to avoid transfers made
to its former owners. "After five days of trial and review of
thousands of pages of additional evidence submitted, including
financial treatises, expert reports and depositions, the court
enters judgment in favor of Defendants on all counts," Bankruptcy
Judge Pamela S. Hollis said in an Oct. 10, 2012 Memorandum Opinion
available at http://is.gd/Zbv9Vkfrom Leagle.com.
Bachrach was a mall-based retailer of men's apparel. Until 2005,
BCI was owned and operated by the Bachrach family.
In its lawsuit, the Debtor seeks to invalidate the Defendants'
sale of the business as fraudulent. The complaint consists of 15
counts, and all but three of the counts allege violations of
federal bankruptcy and state fraudulent conveyance laws, citing 11
U.S.C. Sections 544(b), 548 and 550, and 740 ILCS 160/5 and 160/6.
The fraudulent conveyance counts do not plead state and federal
claims distinctively, presumably because the state and federal
statutes are substantially similar. Count 13 contends that the
Defendants, former board members of BCI, breached fiduciary duties
of good faith, fair dealing, honesty and loyalty in selling BCI.
Count 14 seeks to disallow the Defendants' proofs of claim, citing
11 U.S.C. Sec. 502(d), which blocks payment on a creditor's claim
until that creditor returns property subject to avoidance,
including fraudulent transfers. Count 15 relies on 11 U.S.C. Sec.
510(c) to subordinate claims and liens of the Defendants to the
extent they engaged in inequitable conduct harmful to BCI's
creditors.
The case is BACHRACH CLOTHING, INC., Plaintiff, v. EDGAR H.
BACHRACH, et al., Defendants, Adv. No. 08-00726 (Bankr. N.D.
Ill.). Defendants are Edgar H. Bachrach, his sisters, Sally B.
Robinson and Barbara B. James, and Barsaled, LLC. Ed Bachrach and
his sisters are Barsaled's only members.
Headquartered in Chicago, Illinois, Bachrach Clothing, Inc. --
http://www.bachrach.com/-- manufactured and retailed formal men's
wear and accessories. The company filed for chapter 11 protection
(Bankr. N.D. Ill. Case No. 06-06525) on June 6, 2006. Robert M.
Fishman, Esq., at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC,
represented the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it disclosed
estimated assets and debts between $10 million and $50 million.
BERRY PLASTICS: Appoints Former Goldman Sachs Executive to Board
----------------------------------------------------------------
Berry Plastics Group, Inc., appointed David B. Heller to its Board
of Directors.
Mr. Heller is the former Global Co-Head of the Securities Division
at Goldman, Sachs & Co., where he also served on the Management
Committee. He joined Goldman Sachs in 1989 in New York and spent
significant time living and working in Tokyo and London during his
career with the firm. He retired from Goldman in March of 2012.
Mr. Heller currently serves as a Trustee for the Acumen Fund, the
New Museum of Contemporary Art, Project Morry, and the Third Way.
He earned a B.A. from Harvard College and continues to be involved
with the university as Co-Chair of his class fundraising efforts.
"We are honored to have David join the Board of Berry Plastics.
His extensive background in the financial sector will prove
beneficial as we move the Company forward, pursuing strategic
initiatives to develop innovative new products for our customers
and create increased value for our shareholders," said Jon Rich,
Chairman and CEO of Berry Plastics.
About Berry Plastics
Berry Plastics Corporation manufactures and markets plastic
packaging products, plastic film products, specialty adhesives and
coated products. At Jan. 2, 2010, the Company had more than 80
production and manufacturing facilities, primarily located in the
United States. Berry is a wholly-owned subsidiary of Berry
Plastics Group, Inc. Berry Group is primarily owned by affiliates
of Apollo Management, L.P. and Graham Partners. Berry, through
its wholly owned subsidiaries operates five reporting segments:
Rigid Open Top, Rigid Closed Top, Flexible Films, Tapes/Coatings
and Specialty Films. The Company's customers are located
principally throughout the United States, without significant
concentration in any one region or with any one customer.
On Dec. 3, 2009, Berry Plastics obtained control of 100% of the
capital stock of Pliant upon Pliant's emergence from
reorganization pursuant to a proceeding under Chapter 11 for a
purchase price of $602.7 million. Pliant is a leading
manufacturer of value-added films and flexible packaging for food,
personal care, medical, agricultural and industrial applications.
The acquired business is primarily operated in Berry's Specialty
Films reporting segment.
The Company's balance sheet at April 2, 2011, showed $5.54 billion
in total assets, $5.34 billion in total liabilities, and
$202 million in total stockholders' equity.
* * *
Berry Plastics has a 'B3' corporate family rating, with stable
outlook, from Moody's Investors Service. Moody's said in April
2010 that Berry's B3 CFR reflects weakness in certain credit
metrics, financial aggressiveness and acquisitiveness and a
continued difficult operating and competitive environment
especially in the flexible plastics and tapes segments. The
rating also reflects the Company's exposure to more cyclical end
markets, relatively weak contracts with customers and a high
percentage of commodity products.
In November 2011, Standard & Poor's Ratings Services affirmed the
'B-' corporate credit rating on Berry and its holding company
parent, Berry Plastics Group Inc. "The ratings on Berry reflect
the risks associated with the company's highly leveraged financial
profile and acquisition- driven growth strategy as well as its
fair business risk profile," said Standard & Poor's credit analyst
Cynthia Werneth.
BMB MUNAI: Declares Second Distribution of $0.30 Per Share
----------------------------------------------------------
BMB Munai, Inc., previously reported that the $36 million held in
escrow from the sale of the Company's formerly wholly-owned
subsidiary Emir Oil, LLP, has been released to the Company.
As contemplated at the time of the sale, the board of directors of
the Company promptly met after the release of the escrow funds to
determine the amount and timing of the second cash distribution to
be made to the Company's stockholders, after giving effect to
required fund allocations, actual costs incurred and other
factors. In furtherance thereof, the board of directors has
declared a second cash distribution to stockholders of $0.30 per
share.
The second distribution will be payable on Oct. 30, 2012, to the
common stockholders of record on Oct. 15, 2012. Pursuant to
Financial Industry Regulatory Authority Rule 11140(b)(2), because
the distribution exceeds 25% of the value of Company's common
stock, the ex-dividend date for the distribution will be the first
business day following the payable date. The Company's common
stock price as quoted on the OTCQB is expected to be adjusted
downward on the ex-dividend date to reflect the payment of the
distribution.
Following the second distribution, the Company expects to finalize
the winding down of its operations in Kazakhstan and anticipates
for the foreseeable future continuing its efforts to identify new
business opportunities that will allow it to take advantage of the
expertise of the Company's management staff and return additional
value to its stockholders. The Company does not currently
generate revenue and does not anticipate generating revenue until
such time as it is able to identify and exploit a new business
opportunity. No assurance can be given that the Company will be
able to identify or exploit any new business opportunity, or that
it will have the funds then available to it that will enable it to
seek to take advantage of any such opportunity. These factors
raise substantial doubt about the Company's ability to continue as
a going concern.
About BMB Munai
Based in Almaty, Kazakhstan, BMB Munai, Inc., is a Nevada
corporation that originally incorporated in the State of Utah in
1981. Since 2003, its business activities have focused on oil and
natural gas exploration and production in the Republic of
Kazakhstan through its wholly-owned operating subsidiary Emir Oil
LLP. Emir Oil holds an exploration contract that allows the
Company to conduct exploration drilling and oil production in the
Mangistau Province in the southwestern region of Kazakhstan until
January 2013. The exploration territory of its contract area is
approximately 850 square kilometers and is comprised of three
areas, referred to herein as the ADE Block, the Southeast Block
and the Northwest Block.
BMB Munai reported a net loss of $139.21 million for the year
ended March 31, 2012, compared with net income of $4.88 million
for the year ended March 31, 2011.
The Company's balance sheet at June 30, 2012, showed $38.95
million in total assets, $18.32 million in total liabilities, all
current, and $20.62 million in total shareholders' equity.
Hansen, Barnett & Maxwell, P.C., in Salt Lake City, Utah, issued a
"going concern" qualification on the consolidated financial
statements for the fiscal year ended March 31, 2012. The
independent auditors noted that the Company will have no
continuing operations that result in positive cash flow, which
raises substantial doubt about its ability to continue as a going
concern.
BRAND ENERGY: S&P Assigns 'CCC+' Rating on $325-Mil. Term Loan
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' issue
rating and '6' recovery rating (indicating our expectation of
negligible [0%-10%] recovery in the event of payment default) to
Brand Energy & Infrastructure Services' proposed $325 million
second-lien term loan. "Our 'B' corporate credit rating and stable
outlook on Brand remain unchanged," S&P said.
"At the same time we revised our recovery rating on the proposed
first-lien term loan and revolving credit facility to '3' from '4'
as a result of a greater pledge to the first-lien lenders from the
company's Canadian subsidiary (Aluma Systems Inc., which is now a
borrower under a $150 million first-lien term loan tranche). The
'3' recovery rating indicates our expectation of meaningful (50%-
70%) recovery. Brand is the borrower of the proposed first-lien
$75 million revolver and first-lien $550 million term loan
facility. The 'B' issue-level ratings on all these facilities
remain unchanged. Our 'BB-' issue rating and '1' recovery rating
(very high recovery of 90%-100%) on Brand's $50 million first-lien
letter-of-credit facility also remain unchanged," S&P said.
All ratings are subject to a review of final documentation.
The ratings on Brand reflect S&P's view of the company's "highly
leveraged" financial profile and "weak" business profile.
"Our financial risk assessment reflects Brand's high leverage and
modest cash flow generation prospects over the next two years, and
the overall business risk assessment reflects its exposure to
volatile end-markets and competitive pricing," said Standard &
Poor's credit analyst Nishit Madlani.
"The stable outlook indicates our expectation for sustained low
double-digit EBITDA margins on slow demand recovery in its end-
markets, our expectation leverage will fall to about 6x over the
next 12 months, and that its proposed refinancing extends
maturities on all of its existing debt. Our stable outlook also
reflects our expectation for improved financial flexibility, given
that Brand is extending the maturity on all its existing debt.
Also, over the next 12 months we expect Brand to sustain recent
improvements in EBITDA margins, given its recent ability to
mitigate pricing pressures. Leverage should improve toward 6x,
assuming industry activity picks up to historical levels, which is
likely because customers can only generally delay maintenance work
temporarily," S&P said.
"We could consider a downgrade if the proposed transaction does
not close or if we believe Brand would not reduce leverage toward
6x or less because of renewed pressure on EBITDA margins, leaving
it vulnerable to eventual refinancing risks. A downgrade also
could occur if Brand's liquidity profile deteriorates on end-
markets that are weaker than we expect for a prolonged period,
leading to customers delaying maintenance work over the near term,
or if Brand loses maintenance projects altogether," S&P said.
"An upgrade is unlikely over the next 12 months given our
expectations for company's financial risk profile to remain highly
leveraged. Following the recent refinancing of Brand's second-lien
debt, we believe the increased likelihood that leverage will
remain about 5x or less would be a significant factor for any
positive rating action on the company over the next year," S&P
said.
CAESARS ENTERTAINMENT: Satisfies Escrow Conditions Under Offering
-----------------------------------------------------------------
Caesars Entertainment Corporation previously announced that
Caesars Operating Escrow LLC and Caesars Escrow Corporation,
wholly owned subsidiaries of Caesars Entertainment Operating
Company, Inc., a wholly owned subsidiary of the Company, completed
the offering of $750,000,000 aggregate principal amount of 9%
Senior Secured Notes due 2020.
The Company further announced that pursuant to an escrow agreement
dated as of Aug. 22, 2012, among U.S. Bank National Association,
as escrow agent and securities intermediary, U.S. Bank National
Association, as trustee, under the Indenture, and the Escrow
Issuers, the Escrow Issuers deposited the gross proceeds of the
notes, together with additional amounts necessary to redeem the
notes, if applicable, into a segregated escrow account until the
date that certain escrow conditions were satisfied. The escrow
conditions included, among other things, the assumption by the
Company of all obligations of the Escrow Issuers under the notes
and the receipt of all required regulatory approvals.
On Oct. 5, 2012, the escrow conditions were satisfied, the CEOC
Assumption was consummated and the Bank Transactions were
consummated.
Pursuant to a supplemental indenture, dated as of Oct. 5, 2012,
the Company assumed the obligations of the Escrow Issuers under
the notes and the Indenture. The notes mature on Feb. 15, 2020.
The Indenture provides that the notes are guaranteed by the Parent
Guarantor and are secured by first-priority security interests in
substantially all of the property and assets held by the Company
and each wholly-owned, domestic subsidiary of the Company that is
a subsidiary pledgor with respect to the senior secured credit
facilities, the Company's 11 1/4% senior secured notes due 2017
and the Company's 8 1/2% senior secured notes due 2020, with
certain exceptions. A copy of the Supplemental Indenture is
available for free at http://is.gd/Ke5kqq
On Oct. 5, 2012, in connection with the CEOC Assumption, the
Company and Citigroup Global Markets Inc., as representative of
the initial purchasers, entered into a joinder to the registration
rights agreement, dated as of Aug. 22, 2012, relating to, among
other things, the exchange offer for the notes and the related
guarantee. Pursuant to the Joinder to the Registration Rights
Agreement, the Company became a party to the Registration Rights
Agreement and agreed to be bound by the terms thereof as if it had
originally been a party thereto. A copy of the Joinder Agreement
is available for free at http://is.gd/yaLyZ0
On Oct. 5, 2012, the Company consummated the previously announced
extension transactions with lenders under its senior secured
credit facilities pursuant to which the Company (i) extended the
maturity of approximately $957.5 million aggregate principal
amount of B-1, B-2 and B-3 term loans held by consenting lenders
from Jan. 28, 2015, to Jan. 28, 2018, subject to the springing
maturity referred to in the following sentence, and increased the
interest rate with respect to those extended term loans, which are
new B-6 term loans under the senior secured credit facilities;
(ii) converted approximately $210.3 million aggregate principal
amount of original maturity revolver commitments held by
consenting lenders to Extended Term Loans; and (iii) extended the
maturity of approximately $12.2 million aggregate principal amount
of original maturity revolver commitments held by consenting
lenders who elected not to convert their commitments to term
loans, from Jan. 28, 2014, to Jan. 28, 2017, and increased the
interest rate and the undrawn commitment fee with respect to those
extended revolver commitments.
On Oct. 5, 2012, U.S. Bank National Association, as trustee under
the Indenture, U.S. Bank National Association, as second priority
agent, Bank of America, N.A., as credit agreement agent and U.S.
Bank National Association, as other first priority lien
obligations agent, entered into a joinder to the Intercreditor
Agreement, dated as of Dec. 24, 2008, among Bank of America, N.A.,
as credit agreement agent, U.S. Bank National Association, as
trustee, and each collateral agent for any future second lien
indebtedness from time to time party thereto. Pursuant to the
Joinder to the Intercreditor Agreement, the New Trustee became a
party to and agreed to be bound by the terms of the Intercreditor
Agreement as an other first priority lien obligations agent, as if
it had originally been party to the Intercreditor Agreement as a
first lien agent. A copy of the Joinder and Supplement to
Intercreditor Pact is available at http://is.gd/ZRJqji
On Oct. 5, 2012, U.S. Bank National Association entered into an
other first lien secured party consent to the Collateral
Agreement, as authorized representative, for persons who will
become secured parties under the collateral agreement dated as of
Jan. 28, 2008, as amended and restated as of June 10, 2009, among
the Company, each subsidiary of the Company and Bank of America,
N.A., as collateral agent for the Secured Parties. Pursuant to
the Other First Lien Secured Party Consent to the Collateral
Agreement, the notes will be secured on a first-priority basis by
substantially all of the assets of the Company and the assets of
the subsidiary pledgors, and the Authorized Representative for the
Collateral Agreement was authorized to become a party to the
Collateral Agreement on behalf of the New Secured Parties under
the Indenture and to act as the Authorized Representative for the
New Secured Parties. A copy of the Other First Lien Collateral
Agreement is available at http://is.gd/cFZf9X
On Oct. 5, 2012, U.S. Bank National Association entered into an
other first lien secured party consent to the Guaranty and Pledge
Agreement, as authorized representative, for persons who will
become secured parties under the guaranty and pledge agreement
dated as of Jan. 28, 2008, as amended and restated as of June 10,
2009, among the Parent Guarantor and the Collateral Agent.
Pursuant to the Other First Lien Secured Party Consent to the
Guaranty and Pledge Agreement, the Parent Guarantor guarantees
payment on the senior secured credit facilities and grants to the
Collateral Agent for the benefit of the secured parties a security
interest in all of its rights and title in the Collateral as
collateral security for prompt payment on the notes and the senior
secured credit facilities, and the Authorized Representative for
the Guaranty and Pledge Agreement was authorized to become a party
to the Guaranty and Pledge Agreement on behalf of the New Secured
Parties under the Indenture and to act as the Authorized
Representative for the New Secured Parties. A copy of the
Agreement is available for free at http://is.gd/n0FTXs
A copy of the Form 8-K is available for free at:
http://is.gd/9VU8hi
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
--http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
Harrah's announced its re-branding to Caesar's on mid-November
2010.
The Company reported a net loss of $666.70 million in 2011, and a
net loss of $823.30 million in 2010.
The Company's balance sheet at June 30, 2012, showed
$28.03 billion in total assets, $27.43 billion in total
liabilities, and $607.2 million in total equity.
* * *
As reported by the TCR on March 28, 2012, Moody's Investors
Service upgraded Caesars Entertainment Corp's Corporate Family
Rating (CFR) and Probability of Default Rating both to Caa1 from
Caa2. The upgrade of Caesars' ratings reflects very good
liquidity, an improving operating outlook for gaming in a number
of the company's largest markets that is expected to drive
earnings growth, the completion of a bank amendment that resulted
in the extension of debt maturities to 2018 from 2015, and the
public listing of the company's equity that increases financial
flexibility by providing it with another potential source of
capital. The upgrade of the SGL rating reflects minimal debt
maturities over the next few years, significant cash balances
(approximately $900 million at December 31, 2011) and revolver
availability that will be more than sufficient to fund the
company's cash interest and capital spending needs.
In the Aug. 17, 2012, edition of the TCR, Standard & Poor's
Ratings Services revised its rating outlook on Las Vegas-based
Caesars Entertainment Corp. (CEC) and wholly owned
subsidiary Caesars Entertainment Operating Co. Inc. (CEOC) to
negative from stable. "We affirmed all other ratings on the
companies, including our 'B-' corporate credit rating," S&P said.
As reported by the TCR on Aug. 17, 2012, Fitch Ratings affirmed
Caesars Entertainment Corp.'s Long-term Issuer Default Rating at
'CCC'.
CATHOLIC DIOCESE OF SPOKANE: Sues Bankruptcy Counsel
----------------------------------------------------
Stephanie Gleason at Dow Jones' DBR Small Cap reports that the
Catholic Diocese of Spokane, which filed for Chapter 11 bankruptcy
in 2004 to deal with a bevy of sexual-abuse allegations, is suing
its bankruptcy counsel for malpractice.
About The Diocese of Spokane
The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004. Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it disclosed $11,162,938 in total assets and
$81,364,055 in total debts.
The Diocese of Spokane, the Tort Claimants Committee, the Future
Claims Representative, and the Executive Committee of the
Association of Parishes delivered an Amended Plan of
Reorganization, and a Disclosure Statement describing that Plan to
the Court on Feb. 1, 2007. The Honorable Patricia C. Williams
approved the disclosure statement on March 8, 2007. On April 24,
2007, the Court confirmed Spokane's second amended joint plan.
That plan is effective May 31, 2007. (Catholic Church Bankruptcy
News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
CELL THERAPEUTICS: Tang Capital Discloses 9.9% Equity Stake
-----------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Tang Capital Partners, LP, Tang Capital Management,
LLC, and Kevin C. Tang disclosed that, as of Oct. 5, 2012, they
beneficially own 6,911,221 shares of common stock of Cell
Therapeutics, Inc., representing 9.9% of the shares outstanding.
A copy of the filing is available at http://is.gd/PvJ3Xt
About Cell Therapeutics
Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is
a biopharmaceutical company committed to developing an integrated
portfolio of oncology products aimed at making cancer more
treatable.
Cell Therapeutics reported a net loss attributable to CTI of
US$62.36 million in 2011, compared with a net loss attributable
to CTI of US$82.64 million in 2010.
The Company's balance sheet at June 30, 2012, showed
$38.34 million in total assets, $39.83 million in total
liabilities, $13.46 million in common stock purchase warrants, and
a $14.95 million total shareholders' deficit.
Going Concern Doubt Raised
The report of Marcum LLP, in San Francisco, Calif., dated
March 8, 2012, expressed an unqualified opinion, with an
explanatory paragraph as to the uncertainty regarding the
Company's ability to continue as a going concern.
The Company's available cash and cash equivalents are US$47.1
million as of Dec. 31, 2011. The Company's total current
liabilities were US$17.8 million as of Dec. 31, 2011. The
Company does not expect that it will have sufficient cash to fund
its planned operations beyond the second quarter of 2012, which
raises substantial doubt about the Company's ability to continue
as a going concern.
Bankruptcy Warning
The Form 10-K for the year ended Dec. 31, 2011, noted that if the
Company receives approval of Pixuvri by the EMA or the FDA, it
would anticipate significant additional commercial expenses
associated with Pixuvri operations. Accordingly, the Company
will need to raise additional funds and are currently exploring
alternative sources of equity or debt financing. The Company may
seek to raise that capital through public or private equity
financings, partnerships, joint ventures, disposition of assets,
debt financings or restructurings, bank borrowings or other
sources of financing. However, the Company has a limited number
of authorized shares of common stock available for issuance and
additional funding may not be available on favorable terms or at
all. If additional funds are raised by issuing equity
securities, substantial dilution to existing shareholders may
result. If the Company fails to obtain additional capital when
needed, it may be required to delay, scale back, or eliminate
some or all of its research and development programs and may be
forced to cease operations, liquidate its assets and possibly
seek bankruptcy protection.
CEQUEL COMMUNICATIONS: S&P Rates Proposed $500MM Senior Notes 'B-'
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating and '6' recovery rating to Cequel Communications Escrow I
LLC's proposed $500 million of senior unsecured notes due 2020,
with Cequel Communications Escrow Capital Corp. as co-issuer. The
'6' recovery rating indicates expectations for negligible (0%-10%)
recovery in the event of a payment default. The company will use
proceeds to fund a portion of the purchase price for the
acquisition of cable-TV operator Cequel Communications Holdings
LLC by BC Partners and the Canada Pension Plan Investment Board.
Upon completion of the transaction, Escrow I and Escrow Capital
will be merged into Cequel Communications Holdings I LLC (Cequel)
and Cequel Capital Corp. "Our 'B+' corporate credit rating and
stable outlook on Cequel remain unchanged, as does the 'BB-'
issue-level rating and '2' recovery on subsidiary Cequel
Communications LLC's secured credit facilities, and the 'B-'
issue-level rating and '6' recovery rating on Cequel's existing
unsecured notes," S&P said.
"Pro forma for the transaction, including redemption of the
preferred interest at parent Cequel Communications Holdings LLC,
leverage modestly increases to 6.3x from 5.8x, based on
performance for the 12 months ended June 30, 2012. This result
remains within the parameters of the current rating, given our
assessment of the company's 'satisfactory' business risk profile
and 'highly leveraged' financial risk profile under our criteria,"
S&P said.
RATINGS LIST
Cequel Communications Holdings I LLC
Corporate Credit Rating B+/Stable/--
New Rating
Cequel Communications Escrow I LLC
Cequel Communications Escrow Capital Corp. (co-issuer)
$500 Mil. Sr. Unsec. Notes Due 2020 B-
Recovery Rating 6
CHINA MEDICAL: Judge Grants Protection From U.S. Creditors
----------------------------------------------------------
Marie Beaudette and Rachel Feintzeig at Dow Jones' DBR Small Cap
report that a judge has granted China Medical Technologies Inc.
Chapter 15 protection in the U.S. as liquidators continue winding
down the business in the Grand Caymans.
China Medical Technologies Inc., a maker of diagnostic products,
filed a Chapter 15 bankruptcy petition in New York to locate money
fraudulently transferred by its principals.
The Debtor, which has been taken over by a trustee, is undergoing
corporate winding-up proceedings before the Grand Court of the
Cayman Islands. Kenneth M. Krys, the joint official liquidator,
wants U.S. courts to recognize the Cayman proceeding as the
"foreign main proceeding"
The liquidator filed a Chapter 15 petition for China Medical
(Bankr. S.D.N.Y. Case No. 12-13736) on Aug. 31, 2012. Curtis C.
Mechling, Esq., at Stroock & Stroock & Lavan, LLP, in New York,
serves as counsel.
CHRIST HOSPITAL: McKesson Opposes Assumption of Software License
----------------------------------------------------------------
McKesson Technologies, Inc., has asked the Bankruptcy Court to
issue summary judgment with respect to Christ Hospital's notice of
contingent cure and assumption with respect to executory contracts
or unexpired leases which may be assumed and assigned.
Patrick J. Orr, Esq., at Klestadt & Winters LLP, said that prior
to the Petition Date, McKesson and the Debtor were parties to
several software licensing agreements that provided the
information technology infrastructure for the day-to-day
operations of the Hospital. The software license agreements are
all subject to a restriction preventing assignment without the
express written consent of McKesson.
Immediately after the Debtor's bankruptcy, the Debtor sought an
order approving procedures for the sale of substantially all of
its assets. The Debtor also filed a request seeking determination
regarding assumption and assignment of the agreements between the
Debtor and McKesson. McKesson filed an objection to the pleadings
pointing out that its agreements with the Debtor could not be
assumed or assigned as a matter of law pursuant to applicable
Federal copyright law. McKesson's objection was served on the
prospective purchasers prior to the purchase transaction being
completed.
In April 2012, the Bankruptcy Court approved the sale of Christ
Hospital to Hudson Hospital Holdco, LLC. On the closing date,
July 13, 2012, the Purchaser acquired the Hospital and the Debtor
ceased any involvement in owning or running the Hospital. In
fact, the Debtor no longer has any employees. While the McKesson
agreements were listed as "Designated Contracts," the Debtor has
not taken any further steps to assume those contracts nor assign
them to Hudson. Instead, the Debtor has on multiple occasions
continued the hearing on Assumption/Assignment Motion and the Cure
Notice.
Mr. Orr said that, given the closing of the sale and the legal bar
against assuming and assigning McKesson's agreements, the Court
should grant summary judgment holding that the agreements between
McKesson and Debtor cannot be assumed or assigned as a matter of
law and denying the Assumption/Assignment Motion as it relates to
McKesson. The ruling will not affect the Debtor because it has
already sold the Hospital and is not using McKesson's software.
Hudson purchased the Hospital without conditioning the deal on
being able to assume the McKesson agreements and did not pay any
separate consideration for that software. Mr. Orr said granting
McKesson's Motion will not result in any adverse consequences to
the Debtor or its estate.
Mr. Orr argued that granting the Motion will free the Debtor to
reject all of its agreements with McKesson and thereby avoid the
continued accrual of McKesson's administrative claims (which at
this point exceed $600,000 exclusive of McKesson's post-petition
statutory claims for Debtor's willful violations of Federal
copyright law).
According to Mr. Orr, the license agreements are computer software
licenses which on their face provide for non-exclusive use of
certain of McKesson's computer software, which is protected under
the Computer Software Copyright Act of 1980. Under Federal
copyright law, non-exclusive licenses are not assignable without
the consent of the copyright holder. McKesson has not, and will
not, consent to assignment. Accordingly, there is no reason for
the Court to delay granting summary judgment concerning the
assignability of the agreements between Debtor and McKesson as
requested in the Assumption/Assignment Motion and Cure Notice.
McKesson is represented by:
Tracy L. Klestadt, Esq.
Patrick J. Orr, Esq.
KLESTADT & WINTERS, LLP
570 Seventh Avenue, 17th Floor
New York, NY 10018
Tel: (212) 972-3000
Fax: (212) 972-2245
About Christ Hospital
Christ Hospital filed for Chapter 11 bankruptcy (Bankr. D. N.J.
Case No. 12-12906) on Feb. 6, 2012. Christ Hospital, founded in
1872 by an Episcopalian priest, is a 367-bed acute care hospital
located in Jersey City, New Jersey at 176 Palisade Avenue, serving
the community of Hudson County. The Debtor is well-known for its
broad range of services from primary angioplasty for cardiac
patients to intensity modulated radiation therapy for those
battling cancer. Christ Hospital is the only facility in Hudson
County to offer IMRT therapy, which is the most significant
breakthrough in cancer treatment in recent years.
Christ Hospital filed for Chapter 11 after an attempt to sell the
assets fell through. Judge Morris Stern presides over the case.
Lawyers at Porzio, Bromberg & Newman, P.C., serve as the Debtor's
counsel. Alvarez & Marsal North America LLC serves as financial
advisor. Logan & Company Inc. serves as the Debtor's claim and
noticing agent.
The Health Professional and Allied Employees AFT/AFI-CIO is
represented in the case by Mitchell Malzberg, Esq., at Mitnick &
Malzberg P.C.
CITYCENTER HOLDINGS: Fitch Keeps B- Rating on 2nd Lien Sec. Notes
-----------------------------------------------------------------
Fitch Ratings has affirmed CityCenter Holdings, LLC's Issuer
Default Rating (IDR) at 'B-', the secured credit facility and the
first lien senior secured notes at 'BB-/RR1', and the second lien
secured notes at 'B-/RR4' . The Rating Outlook is Stable.
CityCenter's 'B-' IDR reflects:
-- Adequate liquidity and a solid free cash flow (FCF) profile;
-- Strong asset quality and favorable center location on the Las
Vegas Strip;
-- The property's meaningful exposure to high-end international
play, which has been a major driving factor for the Las Vegas
Strip recovery over the past two years;
-- Fitch's favorable outlook for the Strip, which should benefit
from limited new supply over the next three to five years and
steady, yet lackluster, U.S. economic recovery.
CityCenter's IDR is being constrained by the entity's high
leverage (9.6 times [x] as of June 30, 2012) and the elevated
business risk associated with operating a single-site facility and
high exposure to high-end baccarat play, which tends to have a
volatile win rate.
The business risk concern is partially offset by the meaningful
non-gaming components of CityCenter, which provide a degree of
diversification. Vdara, a non-gaming hotel, and Crystals, a high-
end retail area, contribute 10% and 13% of latest 12-month (LTM)
resort operations EBITDA, respectively. Also, Fitch believes that
CityCenter benefits from being part of MGM Resorts International's
(MGM; 'B-' IDR with Positive Outlook) Las Vegas Strip portfolio
and loyalty database (M life).
The Stable Outlook reflect that there is enough financial
flexibility at 'B-' to absorb a temporary moderate reversal in the
recovery on the Las Vegas Strip. However, CityCenter's high
leverage also limits rating upside. Longer term, CityCenter's IDR
may migrate towards the mid-to-high end of the 'B' category as the
entity is expected to generate considerable FCF, which could be
used to deleverage.
Fitch currently does not link MGM's and CityCenter's IDRs largely
because of MGM's weak financial profile and restrictive debt
covenant limit MGM's capacity to support CityCenter. Also,
CityCenter and MGM both have high exposure to the Strip and in an
event of stressed operating environment both issuers' capacities
to support one another would likely be diminished. In Fitch's
opinion, CityCenter has high strategic value for MGM, which could
support increased rating linkage longer term, but Fitch currently
views CityCenter's credit profile largely on a standalone basis.
Free Cash Flow
Fitch forecasts CityCenter to generate $42 million - $72 million
of FCF in 2013, the first full year in which CityCenter may opt
not to exercise the pay-in-kind (PIK) option on its 2nd lien
notes. The FCF forecast incorporates an EBITDA estimate of $240
million - $260 million, $168 million in interest expense and $20
million - $30 million of maintenance capex. The 2nd lien notes'
PIK option runs through 2016, which can provide up to $80 million
in cash flow relief if needed.
Fitch expects cash to be retained at the JV level since both the
note and loan covenants restrict dividends and the JV's
requirement to use its excess cash flow to paydown the term loan
was eliminated when CityCenter paid-down the loan using proceeds
from a 1st lien tack-on issuance in February 2012. (In March,
CityCenter amended its credit facility, which now consists of a
$75 million undrawn revolver.) CityCenter's notes are trading at a
significant premium (around 107) but become callable in January
2014 (first liens at 103.8 and 2nd liens at 105.4).
Liquidity
CityCenter's liquidity is healthy. As of June 30, 2012, available
liquidity is approximately $268 million and consists of:
-- $75 million undrawn revolver maturing January 2015;
-- $140 million of unrestricted excess cash (net of estimated
$27 million of cage cash); and
-- $53 million remaining in a capitalized interest account.
Aside from the revolver, the nearest maturity is the 1st lien note
with $1.15 billion outstanding in January 2016. Fitch projects
that CityCenter will accumulate nearly $500 million in excess cash
by year-end 2015.
Covenants are not a major concern as the bonds have no maintenance
covenants and the amended credit facility's minimum EBITDA
covenant should be manageable. The covenant starts at $185
million in March 31, 2013 and steps up to $250 million by
September 2014 compared to a latest 12 months (LTM) EBITDA level
of $194 million. Fitch projects that the revolver will remain
undrawn therefore risk of technical default per the agreement is
largely a non-event.
Capital Structure
CityCenter's capital structure consists of:
-- $75 million revolver, which is pari passu to the first lien
notes;
-- $1.15 billion in first lien notes maturing January 2016;
-- $705 million ($746 million pro forma for July 2012 PIK) in
second lien notes due January 2017; and
-- $607 million ($1.15 billion face value) in member loans which
Fitch views as equity.
Leverage through the first-lien and second-lien is approximately
5.9x and 9.6x, respectively, as of June 30, 2012. Fitch expects
leverage to improve to around 5.0x and 7.5x, respectively, by
year-end 2013. Leverage may improve further closer to the 2016
maturity of the first lien notes as CityCenter may look to use
some of the accumulated cash to reduce the amount outstanding
prior to and in connection with the refinancing.
Las Vegas Outlook
Fitch believes the fundamental outlook for the Las Vegas Strip
remains among the safest markets in the U.S. for the balance of
2012 and 2013, supported by minimal supply growth for the
foreseeable future.
The Las Vegas Strip recovery trajectory slowed materially in
second-quarter and forward trends softened, as the shorter-term
group/business segment (i.e. in the year, for the year) weakened.
Visitation is up 1.8% year-to-date through August, while gaming
revenues are up 2.6% on the Las Vegas Strip.
Fitch currently anticipates visitation and revenue growth in 2013
to be similar to 2012 and expects Aria, CityCenter's gaming
component, to grow gaming revenues at a faster rate than the
market given the property's continued ramp up and high-end mix.
Recovery Ratings (RR)
The 'BB-/RR1' rating on the first-lien notes and the credit
facility reflects Fitch's estimate of 91%-100% recovery in an
event of default and results in a three-notch positive
differential from the 'B-' IDR.
For the second lien PIK notes, Fitch estimates average recovery
prospects in the 31%-50% range, which equates to a 'B-/RR4' rating
or a no differential from the 'B-' IDR.
Fitch calculates CityCenter's value by valuing separate operating
components, most notable of which is Aria (valued at 8x of a
stressed LTM EBITDA) and Crystals (using a cap rate of 8.5%).
Rating Triggers
The following could trigger an IDR downgrade to 'CCC':
-- FCF approaching or declining below zero; and/or
-- 2016 first-lien maturity becoming current.
Fitch would consider upgrading CityCenter's IDR to 'B' if:
-- Las Vegas Strip fundamentals remain healthy, and
-- Leverage through the second-lien notes approaches mid-single
digit range (around 5x-6x) in the near-term projection
horizon.
COMMUNITY HOME: Judge Holds Key Motions in Abeyance
---------------------------------------------------
U.S. Bankruptcy Judge Edward Ellington has held in abeyance the
following motions filed in the bankruptcy proceeding of Community
Home Financial Services, Inc.:
-- Edwards Family Partnership, LP, and Beher Holdings Trust's
Motion to Appoint Chapter 11 Trustee for Debtor;
-- Motion to Amend Interim Order (on EFP and BHT's Emergency
Motion to Prohibit Cash Collateral) filed by Debtor; and
-- Motion for Examiner filed by Debtor.
About Community Home Financial
Community Home Financial Services, Inc., filed a Chapter 11
petition (Bankr. S.D. Miss. Case No. 12-01703) on May 23, 2012.
Community Home Financial is a specialty finance company located in
Jackson, Mississippi, providing contractors with financing for
their customers. CHFS operates from one central location
providing financing through its dealer network throughout 25
states, Alabama, Delaware, and Tennessee. The Debtor scheduled
$44,890,581 in total assets and $30,270,271 in total liabilities.
Judge Edward Ellington presides over the case.
Derek A. Henderson, Esq., at Derek A. Henderson Law Office, in
Jackson, Mississippi; Jonathan Bissette Esq., at Wells Marble &
Hurst, PLLC, in Jackson, Mississippi; and Roy H. Liddell, Esq., at
Wells Marble & Hurst, PLLC, in Ridgeland, Mississippi, represent
the Debtor as counsel.
COMPOSITE TECHNOLOGY: Wants Plan Filing Period Extended to Dec. 7
-----------------------------------------------------------------
Composite Technology Corporation, et al., ask the U.S. Bankruptcy
Court for the Central District of California to extend their
exclusive periods to file and solicit acceptances of a plan until
Dec. 7, 2012, and Feb. 8, 2013, respectively.
In their request for a fifth exclusivity extension, the Debtors
believe that an additional 90-day extension of the exclusivity
periods is reasonable so that they will have sufficient time to
adequately negotiate terms of consensual plans with Partners for
Growth II, LP, their senior secured creditor, and the Official
Committee of Unsecured Creditors of CTC Cable and other
constituents in their cases, and that the requested extensions of
the plan exclusivity periods will not result in any prejudice to
the Debtors' creditors.
About Composite Technology
Headquartered in Irvine, California, Composite Technology
Corporation (CTC) -- http://www.compositetechcorp.com/-- is a
publicly traded company that owns all of the common stock of CTC
Cable Corporation and Stribog, Inc. CTC Cable manufactured and
marketed innovative energy efficient renewable energy products
for the electrical utility industry. Stribog operated a wind
turbine products business that was sold to Daewoo Shipbuilding
and Marine Engineering on Sept. 4, 2009, for US$32.2 million in
cash. CTC Renewables is a dormant company.
Composite Technology filed for Chapter 11 bankruptcy (Bankr. C.D.
Calif. Case No. 11-15058) on April 10, 2011, with Judge Mark S.
Wallace presiding over the case. The Debtor's bankruptcy case
was reassigned to Judge Scott C. Clarkson on April 13, 2011. BCC
Advisory Services LLC, BCC Ho1dco LLC's FINRA registered
Broker/Dealer, serves as investment banker to provide exclusive
equity financing services and debt financing services. Composite
Technology disclosed US$5,855,670 in assets and US$12,395,916 in
liabilities as of the Chapter 11 filing.
CTC Cable Corporation also filed for Chapter 11 (Bankr. C.D.
Calif. Case No. 11-15059) on April 10, 2011. Stribog, Inc.
(Bankr. C.D. Calif. Case No. 11-15065) filed for Chapter 11
protection on April 11, 2011. CTC Renewables Corp., a dormant
company (Bankr. C.D. Calif. Case No. 11-15130) filed for Chapter
11 protection on April 12, 2011.
The cases are jointly administered, with Composite Technology as
the lead case. Garrick A. Hollander, Esq., Jeannie Kim, Esq.,
Kavita Gupta, Esq., Paul J. Couchot, Esq., and Richard H. Golubow,
Esq., at Winthrop Couchot PC, in Newport Beach, Calif.; and Sean
A. Okeefe, at Okeefe & Associates Law Corporation, in Newport
Beach, Calif., serve as the Debtors' bankruptcy counsel.
Peter C. Anderson, the U.S. Trustee for Region 16, appointed five
members to the official committee of unsecured creditors in the
Debtor's cases. Celina M. Munoz, Esq., Emily Ma, Esq., Katherine
C. Piper, Esq., and Robbin L. Itkin, Esq., at Steptoe & Johnson
LLP, in Los Angeles, Calif., represents the Committee.
On Aug. 15, 2011, the Debtors closed on the sale of substantially
all assets of the Debtors' estates to CTC Acquisition Corp., a
Delaware corporation. As a result of the sale, the Debtors no
longer operated their businesses and all of their employees either
resigned or were terminated, and most of them were employed by the
Buyer. After the closing, the Debtors promptly moved to hire
Brian Weiss, as the CRO, to wind down the Debtors' business
affairs, including recovering money for the estate's creditors and
resolving disputes among the creditors.
COMSTOCK MINING: Longview Fund Discloses 5.3% Equity Stake
----------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Longview Fund L.P. disclosed on Oct. 9, 2012,
that it beneficially owns 3,153 shares of A-2 Convertible
Preferred Stock representing 4,843,327 shares of Common Stock on
an as converted basis and an additional 691,244 shares of Common
Stock of Comstock Mining Inc. representing 5.349% of the shares
outstanding.
Longview Fund previously reported beneficial ownership of
4,053 shares of A-2 Convertible Preferred Stock representing
6,225,816 shares of Common Stock on an as converted basis and an
additional 537,656 shares of common stock of Comstock as of
Aug. 10, 2012.
A copy of the amended filing is available for free at:
http://is.gd/x8oSpX
About Comstock Mining
Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based,
gold and silver mining company with extensive, contiguous property
in the historic Comstock district. The Company began acquiring
properties in the Comstock in 2003. Since then, the Company has
consolidated a substantial portion of the Comstock district,
secured permits, built an infrastructure and brought the
exploration project into test mining production. The Company
continues acquiring additional properties in the Comstock
district, expanding its footprint and creating opportunities for
exploration and mining. The goal of the Company's strategic plan
is to deliver stockholder value by validating qualified resources
(measured and indicated) and reserves (probable and proven) of
3,250,000 gold equivalent ounces by 2013, and commencing
commercial mining and processing operations by 2011, with annual
production rates of 20,000 gold equivalent ounces.
The Company reported a net loss of $11.61 million in 2011,
compared with a net loss of $60.32 million in 2010.
The Company's balance sheet at June 30, 2012, showed
$35.40 million in total assets, $16.47 million in total
liabilities and $18.92 million in total stockholders' equity.
COPYTELE INC: Denis Krusos Resigns from Board of Directors
----------------------------------------------------------
Denis A. Krusos notified CopyTele, Inc., of his resignation as a
director of the Company, effectively on Oct. 8, 2012. Mr. Krusos
was previously removed as Chief Executive Officer and terminated
as an employee of the Company on Aug. 21, 2012.
About CopyTele
Melville, N.Y.-based CopyTele, Inc.'s principal operations include
the development, production and marketing of thin flat display
technologies, including low-voltage phosphor color displays and
low-power passive E-Paper(R) displays, and the development,
production and marketing of multi-functional encryption products
that provide information security for domestic and international
users over several communications media.
The Company's balance sheet at July 31, 2012, showed $5.9 million
in total assets, $6.8 million in total liabilities, and a
shareholders' deficit of $893,071.
According to the Company's quarterly report for the period ended
July 31, 2012, based on information presently available, the
Company does not believe that its existing cash, cash equivalents,
and investments in certificates of deposit, together with cash
flows from expected sales of its encryption products and revenue
relating to its display technologies, and other potential sources
of cash flows or necessary expense reductions including employee
compensation, will be sufficient to enable it to continue its
marketing, production, and research and development activities for
12 months from the end of this reporting period. "Accordingly,
there is substantial doubt about our ability to continue as a
going concern.
COVENTRY FIRE DEP'T: In Receivership After Budget Voted Down
------------------------------------------------------------
Bill Tomison at WPRI.com reports that Coventry, Rhode Island's
central fire department district has filed for receivership, after
taxpayers voted down the department's proposed budget in a
meeting.
The department's fire chief disclosed the filing to have financial
control taken over by government officials, according to the
report. The report relates that the fire district's board had
voted to file that morning.
The report notes that a meeting on Oct. 2 was fraught with
disapproval from taxpayers, who wouldn't approve the new budget
because the proposal didn't say how fire tax bills would be
increased.
WPRI.com discloses that district's treasurer's report revealed
that the fire department is $1.6 million in the red. Financial
issues include not keeping up on payments for health insurance to
Blue Cross and Blue Shield of Rhode Island, the report relates.
The report notes that the decision means the department won't be
able to pay its firefighters. Firefighter David Gorman, President
of Local 3372, says that won't keep them off the job, relates.
The department has 52 firefighters to cover 26 square miles of
Coventry.
CRAZY HORSE: Centerfold Cabaret Files for Chapter 11 Bankruptcy
---------------------------------------------------------------
Paul Brinkmann, writing for the South Florida Business Journal,
reports that Centerfolds Cabaret, owner of a strip club, has filed
for Chapter 11 bankruptcy, with less than $1 million in debts.
According to the report, bankruptcy attorney Bart Houston of Fort
Lauderdale-based Kopelowitz Ostrow Ferguson Weiselberg Keechl said
the club will remain open.
The report notes company president Steven Paik signed the
bankruptcy petition for Crazy Horse Entertainment Florida LLC, the
registered name of the business. The property for the club, 1350
SW 2nd Street, is not part of the bankruptcy and is owned by a
separate company, Beeline Entertainment of Lake Mary near Orlando.
Nightclub operators Charles Veigle, Sr. and his son Charles
Veigle, Jr., are the owners of Beeline Entertainment.
The report adds Florida creditors listed on the bankruptcy
petition included: ADT, Boca Raton; Amerigas, Pompano Beach;
Cheney Brothers Inc., West Palm Beach; Choice Environmental, Fort
Lauderdale; City of Pompano Beach, Pompano Beach; Clearchannel,
Hollywood; County Soda, Pompano Beach; Double Eagle, Deerfield
Beach; Florida Power & Light, Miami; National Liquor, Deerfield
Beach; NewTimes magazine, Fort Lauderdale; Orkin, Fort Lauderdale;
Out of the Box Creations, Lake Worth; Restaurant Depot, Pompano
Beach; Southern Wine and Spirits, Lakeland; and Xcitement Magazine
- Media Network, Fort Lauderdale, FL.
CUBIC ENERGY: Tauren Settles Dispute with EXCO & BG
---------------------------------------------------
Cubic Energy, Inc., entered into a Settlement Agreement and Mutual
Release with Tauren Exploration, Inc., EXCO Operating Company, LP,
and BG US Production Company, LLC. The Agreement provides that
EXCO and BG will:
(a) apply the Company's prepaid drilling credits as provided in
the Agreement and place the Company in consent status on
specified wells; and
(b) pay to the Company the total amount of $12,179,853 in cash.
Pursuant to the Fourth Amendment to Credit Agreement between the
Company and Wells Fargo Energy Capital, Inc., $9,134,890 of that
total amount will be paid to Wells Fargo in order to reduce the
borrowings under the Company's revolving credit facility with
Wells Fargo. The Agreement also provides for mutual releases
among the parties.
Tauren is wholly owned by Calvin A. Wallen, III, the Company's
President and Chief Executive Officer. Tauren was named as a co-
petitioner along with the Company in the dispute with EXCO and BG.
A copy of the Settlement Agreement is available for free at:
http://is.gd/j4NUOG
About Cubic Energy
Cubic Energy, Inc., headquartered in Dallas, Tex., is an
independent upstream energy company engaged in the development and
production of, and exploration for, crude oil and natural gas.
Its oil and gas assets and activities are concentrated in
Louisiana.
The Company said in its quarterly report for the period ended
March 31, 2012, that, "Our debt to Wells Fargo, with a principal
amount of $35,000,000, is due on July 1, 2012, and the Wallen
Note, with a principal amount of $2,000,000, is due Sept. 30,
2012, and both are classified as a current debt. As of March 31,
2012, we had a working capital deficit of $33,162,110. This level
of negative working capital creates substantial doubt as to our
ability to pay our obligations as they come due and remain a going
concern. We are negotiating with Wells Fargo and Mr. Wallen to
extend the maturity date of these debts. There can be no
assurance that the Company will be able to negotiate such
extensions."
The Company's balance sheet at June 30, 2012, showed $30.54
million in total assets, $38.70 million in total liabilities, all
current, and a $8.16 million total stockholders' deficit.
Philip Vogel & Co. PC, in Dallas, Texas, issued a "going concern"
qualification on the consolidated financial statements for the
year ended June 30, 2012. The independent auditors noted that the
Company has experienced recurring net losses from operations and
has uncertainty regarding its ability to meet its loan obligations
which raise substantial doubt about its ability to continue as a
going concern.
Bankruptcy Warning
"While we commenced a formal process to pursue strategic
alternatives, there can be no assurance that the process will
result in any transaction, or that, even if a transaction is
consummated that it will resolve our significant short-term
liquidity issues," the Company said in its annual report for the
year ended June 30, 2012. "Even if a potential transaction is
announced, no assurances can be given that such potential
transaction will have a positive effect on our stock price.
Additionally, if a transaction is announced but is not
consummated, our stock price may be adversely affected.
Restructuring, refinancing or extending the payment date of our
indebtedness likely will be necessary."
The Company added, "We are continuing to discuss potential
transactions with third parties and expect to engage in further
discussions with our lenders regarding extensions of the repayment
dates of our indebtedness. There can be no assurance that these
discussions will lead to a definitive agreement on acceptable
terms, or at all, with any party. Any transaction could be highly
dilutive to existing stockholders. If we are unsuccessful in
consummating a transaction or transactions that address our
liquidity issues, we could be required to seek protection under
the U.S. Bankruptcy Code."
DEWEY & LEBOEUF: Wants Committee of Former Partners Disbanded
-------------------------------------------------------------
Dewey & LeBoeuf LLP asks the U.S. Bankruptcy Court for the
Southern District of New York to enter an order directing the
United States Trustee to disband the official committee of former
partners appointed in the Debtor's Chapter 11 case because a
second official committee is not "necessary" for these reasons:
-- FPC claims for retirement and/or separation benefits would,
even if allowed as claims, be subordinated to what the Debtor
estimates to be at least $500 million in allowed secured and
general unsecured claims. There is no dispute that this
$500 million in claims will not be paid in full.
Thus, it is highly unlikely that the constituency this
official committee is supposed to represent has any
legitimate financial stake in this bankruptcy case, and are
"out of the money." The only cognizable economic interest
this committee appears to have is avoiding liability for some
sub-set of its constituents as putative "claw back"
defendants in actions that will likely be brought in the
future.
-- Even if the Debtor's former partners are general unsecured
claimants to be paid pari passu with the rest of the
unsecured creditors, the Official Creditors Committee has
been adequately representing the interests of the FPC's
constituency and the U.S. Trustee has already made clear that
the FPC is not to represent the interests of Former Partners
as general unsecured creditors.
-- Two of the members of the FPC have signed on to the
partner contribution plan ("PCP") and, as a consequence, have
agreed to waive any claims they may have against the estate.
Furthermore, two additional members of the FPC recently
resigned their memberships.
-- The FPC has not contributed in a productive way to
this bankruptcy case. Instead, the FPC has consistently
taken positions that are detrimental to the orderly
administration of this case and contrary to the efforts of
the Debtor's bona fide stakeholders (i.e., the Secured
Lenders and general unsecured creditors) and the FPC has
only sought to frustrate the Chapter 11 process without any
tangible benefit to its constituents, or more importantly,
the estate.
-- If the FPC is disbanded, Former Partners may continue
to appear and be heard on any issue in the case individually
or as a group, as evidenced by the existence and involvement
of the Ad Hoc Committee of Retired Partners of LeBoeuf, Lamb,
Leiby & MacRae (the "Ad Hoc Committee") who continued to be
vocal in the case despite the FPC's appointment. In fact,
the only remaining members of the FPC who have not already
agreed to waive whatever claims they possess against the
Debtor's estate are founding members of the Ad Hoc Committee
and, until recently, were on the steering committee that
directs the Ad Hoc Committee's actions.
As reported in the TCR on Oct. 10, 2012, the Bankruptcy Court
approved Dewey & LeBoeuf's partner contribution settlement
agreements and mutual releases for certain participating partners.
Under the PCPs, 400 of Dewey's roughly 670 ex-partners agreed to
participate and have committed roughly $71 million in aggregate
settlement payments, constituting roughly 80% of the aggregate of
all partner contribution amounts sought from former partners.
The Court also denied the request by the Ad Hoc Committee of
Retired Partners of LeBoeuf, Lamb, Leiby & MacRae to appoint an
examiner.
The Debtor tells the Court:
"It is stunning to the Debtor, the Official Creditors Committee
and the Secured Lenders that the FPC's response to the PCP was to
oppose it. There is no question that the PCP is in the best
interests of all of the Former Partners of the Debtor,
as reflected by the fact that a majority of partners have signed
onto the PCP."
"The FPC's opposition to the PCP and related support for the Ad
Hoc Committee's motion for the appointment of a trustee or
examiner has been costly and unproductive. The FPC has generated
an estimated $779,000 in legal fees through Aug. 31, 2012, alone,
without any corresponding benefit to the estate. Enough is
enough. The FPC's aggressive litigation tactics have also caused
the Debtor and several other parties in interest to incur hundreds
of thousands of dollars in legal fees that should have been
avoided. Now that the PCP has been accepted by nearly every key
stakeholder in the case, and approved by this Court, it is clear
that the unprecedented decision to empower an official former
partners' committee, paid from the limited assets of the estate,
was a misstep that needs to be corrected."
The Am Law Daily reports Cameron MacRae III, Esq., a Duane Morris
partner who sits on the official committee, said he stands by the
U.S. trustee's appointment of the group as an appropriate vehicle
for retirees, "who have suffered the most," to have a voice in the
proceedings.
The committee also includes two legacy Dewey Ballantine partners
-- Stuart Hirshfield, now senior counsel at Mintz, Levin, Cohn,
Ferris, Glovsky and Popeo; and E. Ann Gill, now an attorney with
real estate management company Balmer Parc -- who came on board
this summer. The Am Law Daily says both signed on to the partner
contribution plan: Mr. Hirshfield agreed to contribute $5,000 and
Ms. Gill $5,085. Mr. Hirshfield said he believes the committee
should continue to exist but had no further comment. Ms. Gill
could not be reached for comment Thursday.
The report says a hearing on the request to dismantle the group is
scheduled for November 1 at 2 p.m.
About Dewey & LeBoeuf
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 $245 million and assets of $193 million in
its chapter 11 filing late evening on May 29, 2012.
Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird
-- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in
1929. In recent years, more than 1,400 lawyers worked at the firm
in numerous domestic and foreign offices.
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 $6
million. The Pension benefit Guaranty Corp. took $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 creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
DEWEY & LEBOEUF: CRO Thinks Case Won't Be Converted to Chapter 7
----------------------------------------------------------------
Sara Randazzo at The AM Law Daily reported that Dewey & LeBoeuf
chief restructuring officer, Joff Mitchell, said he thinks it is
unlikely Dewey's case will be converted to a Chapter 7 proceeding
at this point, something Dewey bankruptcy lawyer Albert Togut
frequently raised as a possibility if a $71.5 million settlement
plan with former partners failed to win approval, and that Judge
Martin Glenn acknowledged in his ruling.
Mr. Mitchell, according to the report, also said he expects some
of the roughly 220 former Dewey partners who have not yet signed
on to the settlement, called partner contribution plan or PCP, to
do so now that Judge Glenn has given the plan his blessing -- and
that the estate is likely to waive any late fees it previously
said would apply for those who waited too long. Mr. Mitchell also
said the estate is also in preliminary talks with firms that hired
partners handling ongoing Dewey matters to seek the return of
money based on the unfinished business doctrine.
On Tuesday, the Court approved the PCP, wherein former partners
will repay the Dewey estate $71.5 million. According to The AM
Law Daily, the plan made the Dewey bankruptcy the first in which a
major law firm has managed to resolve claims against a majority of
its former partners within mere months of dissolving. Roughly 450
former Dewey partners have so far agreed to pay the estate sums
ranging from $5,000 to $3.37 million each based on money they
received from the firm in 2011 and 2012. In exchange, those who
have agreed to participate in the settlement will receive a waiver
of most Dewey-related liability, though the PCP does not protect
them against suits that may be brought by third parties or former
partners who do not sign on.
Three Dewey leaders -- former chairman Steven Davis, former
executive director Stephen DiCarmine, and former chief financial
officer Joel Sanders -- were not allowed to participate in the
PCP, and the estate has said repeatedly that it intends to pursue
claims against them.
The AM Law Daily reports that Ned Bassen, a Hughes Hubbard & Reed
partner who is representing Messrs. Davis, DiCarmine, and Sanders
in connection with the bankruptcy, said via e-mail that his
clients were pleased that the bankruptcy judge addressed their
concerns that they not be blamed for more than their proportionate
share of the firm's demise. Mr. Bassen also pointed to a footnote
in the ruling in which Judge Martin Glenn wrote that, "The Court
has no basis to conclude -- and does not conclude -- that there
are any viable claims that can be pursued against Davis, DiCarmine
and Sanders, or what defenses they may be able to assert."
AM Law Daily notes Judge Glenn's ruling comes a day after the Wall
Street Journal reported that the Manhattan district attorney's
office is continuing its investigation into the circumstances
surrounding Dewey's fall.
In his 27-page ruling, Judge Glenn also rejected a call from two
groups of retired partners affiliated with predecessor firm
LeBoeuf, Lamb, Greene & MacRae that he appoint an examiner to
review the settlement.
AM Law Daily reports that, in a statement, Dorsey & Whitney
partners Annette Jarvis and Eric Schnabel, who represent the ad
hoc committee of retired partners, said they are "very
disappointed" that the judge rejected their examiner motion.
"The sordid facts underlying the Dewey & LeBoeuf demise cry out
for investigation by an independent examiner," the statement
continues. "The Court's attribution of improper motives to the
retirees who brought the motion adds insult to injury. The Ad Hoc
Committee will be examining the decision with a view to appeal."
The report notes David Friedman, Esq., a Kasowitz Benson Torres &
Friedman partner who represents the official committee of former
partners, did not return a request for comment.
The report also relates Mark Zauderer, a lawyer who represents 58
former Dewey partners, called the course of events since Dewey
went under and the approval of the settlement "an unfortunate
situation that yielded a practical result that really allows
competent professionals to go on with their professional lives."
About Dewey & LeBoeuf
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 $245 million and assets of $193 million in
its chapter 11 filing late evening on May 29, 2012.
Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird
-- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in
1929. In recent years, more than 1,400 lawyers worked at the firm
in numerous domestic and foreign offices.
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 $6
million. The Pension benefit Guaranty Corp. took $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 creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
As reported by the Troubled Company Reporter, Judge Martin Glenn
on Tuesday approved the so-called partner contribution plan.
The report relates Mr. Togut also argued the $779,000 Kasowitz has
billed for its work on the case between its appointment June 4 and
the end of August is double the amount that has been budgeted for
the committee's legal fees -- and a major drain on the estate's
resources. By raising opposition to the settlement plan with
former partners, Mr. Togut adds, "the Debtor (along with its
professionals) was forced to collect more than 70,000 pages of
documents from multiple sources and to process and produce more
than 22,000 pages on an expedited schedule," as well as spend two
days making people available for depositions.
The Am Law Daily also reports Cameron MacRae III, Esq., a Duane
Morris partner who sits on the official committee, said he stands
by the U.S. trustee's appointment of the group as an appropriate
vehicle for retirees, "who have suffered the most," to have a
voice in the proceedings.
The committee also includes two legacy Dewey Ballantine partners
-- Stuart Hirshfield, now senior counsel at Mintz, Levin, Cohn,
Ferris, Glovsky and Popeo; and E. Ann Gill, now an attorney with
real estate management company Balmer Parc -- who came on board
this summer. The Am Law Daily says both signed on to the partner
contribution plan: Mr. Hirshfield agreed to contribute $5,000 and
Ms. Gill $5,085. Mr. Hirshfield said he believes the committee
should continue to exist but had no further comment. Ms. Gill
could not be reached for comment Thursday.
The report says a hearing on the request to dismantle the group is
scheduled for November 1 at 2 p.m.
About Dewey & LeBoeuf
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 $245 million and assets of $193 million in
its chapter 11 filing late evening on May 29, 2012.
Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird
-- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in
1929. In recent years, more than 1,400 lawyers worked at the firm
in numerous domestic and foreign offices.
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 $6
million. The Pension benefit Guaranty Corp. took $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 creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
DEWEY & LEBOEUF: Criminal Probe Gains Steam But Hurdles Remain
--------------------------------------------------------------
Max Stendahl at Bankruptcy Law360 reports that as Manhattan
prosecutors reportedly deepen a criminal probe of Dewey & LeBoeuf
LLP's former leaders over the firm's collapse, they face a
familiar stumbling block, attorneys say: building a case from a
hodgepodge of evidence that may lack a smoking gun.
About Dewey & LeBoeuf
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 $245 million and assets of $193 million in
its chapter 11 filing late evening on May 29, 2012.
Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird
-- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in
1929. In recent years, more than 1,400 lawyers worked at the firm
in numerous domestic and foreign offices.
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 $6
million. The Pension benefit Guaranty Corp. took $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 creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
DIGITAL DOMAIN: Asks West Palm to Waive Right to Sue Company
------------------------------------------------------------
Andrew Abramson at the Palm Beach Post reports that the city of
West Palm Beach is being asked to waive its right to sue Digital
Domain Media Group.
The report recounts that West Palm Beach argued in court filings
last month that it should get back its $10 million downtown parcel
because a city-imposed restriction on the land makes it worthless
to Digital Domain's many creditors. Forcing the city to be thrown
into a protracted bankruptcy court fight "would be a significant
waste of taxpayer money," the city argued.
In its response to the city's claims, Digital Domain said it
wouldn't object to the land's removal from bankruptcy court
"provided that WPB agrees to waive any claims, including
administrative expense claims, against (Digital Domain's)
estates." City officials would not say whether they would agree
to those terms, according to the report.
The report notes that, while the bankruptcy court cannot return
the land to West Palm Beach, it can agree to remove it from the
bankruptcy proceedings. The city still would have to pursue its
claim to the land in state court.
The report relates a best-case outcome for the city would be that
it quickly reclaims its downtown land; the Florida State
University film school, drawn to West Palm Beach by Digital
Domain, remains downtown; and the city will have lost only the
money spent on bankruptcy attorneys, who are charging $375 an
hour.
The report adds, in the worst case, the bankruptcy court would
refuse to release the land, delivering a black eye to the city's
economic development efforts and forcing the city to continue to
pursue its rights in federal court.
The report recounts West Palm Beach deeded 2.4 acres on Okeechobee
Boulevard downtown to Digital Domain in December 2010 as an
incentive to draw a high-rise to house FSU and a digital animation
college. But the city added title conditions calling for the land
to revert back to the city if Digital Domain failed to meet
several thresholds by Dec. 31 this year.
The report notes a hearing on the city's arguments is scheduled
for Oct. 23 before U.S. Bankruptcy Judge Brendan Shannon. Digital
Domain and its creditors had until Wednesday to file an objection
to West Palm Beach's request. Lenders with claims against Digital
Domain joined in support of Digital Domain's motion.
The report relates Tina Talarchyk, a Palm Beach bankruptcy lawyer
who has served as Chapter 11 counsel for several major
corporations, said she expects the city would agree.
According to the report, the city argued the company has not
progressed at all toward meeting the deadlines and couldn't
possibly meet them by the end of the year. Without the ability to
build on it, the land would have no value to Digital Domain's
creditors, the city said.
Intent on diversifying the economy, the city also pledged $10
million in cash to Digital Domain, of which $2 million was paid
last year. The $2 million went toward bringing FSU's film school
to a partnership with Digital Domain. The city doesn't expect
that money to be returned, the report says.
The report notes FSU trustees have not committed to staying in
West Palm Beach, but Mayor Jeri Muoio has said she's hopeful the
university will remain.
About Digital Domain
Port St. Lucie, Florida-based Digital Domain Media Group, Inc. --
http://www.digitaldomain.com/-- engaged in the creation of
original content animation feature films, and development of
computer-generated imagery for feature films and transmedia
advertising primarily in the United States.
Digital Domain Media Group, Inc. and 13 affiliates sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 12-12568) on Sept. 11,
2012, to sell its business for $15 million to Searchlight Capital
Partners LP, subject to higher and better offers.
At the auction on Sept. 21, the principal part of the business was
purchased by a joint venture between Galloping Horse America LLC,
an affiliate of Beijing Galloping Horse Co., and an affiliate of
Reliance Capital Ltd., based in Mumbai. The $36.7 million total
value of the contact includes $3.6 million to cure defaults on
contracts and $2.9 million in reimbursement of payroll costs.
Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the
Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief
restructuring officer. Kurtzman Carson Consultants LLC is the
claims and notice agent.
An official committee of unsecured creditors appointed in the case
is represented by lawyers at Sullivan Hazeltine Allinson LLC and
Brown Rudnick LLP.
The company listed assets of $205 million and liabilities totaling
$214 million. Debt includes $40 million on senior secured
convertible notes plus $24.7 million in interest. There is
another issue of $8 million in subordinated secured convertible
notes.
The Debtors also have sought ancillary relief in Canada, pursuant
to the Companies' Creditors Arrangement Act in the Supreme Court
of British Columbia, Vancouver Registry.
DISTHENE GROUP: High Court Rejects Bid to Halt Liquidation
----------------------------------------------------------
Bill McKelway at Richmond Times-Dispatch in Richmond, Virginia
reports that the state Supreme Court has rejected efforts by a
Buckingham County mining operation to immediately halt liquidation
proceedings pending an appeal of a lower court decision issued in
August.
In a three-paragraph order, the Times-Dispatch relates, the court
left intact liquidation proceedings that were ordered last month
by a Fairfax County Circuit Court judge days after she found that
corporate leaders of the Disthene Group Inc. had oppressed
minority shareholders through a pattern of self-dealing and
unsound business practices.
According to the report, the practical impact of the order allows
receivers appointed by the lower court to proceed with efforts to
assess Disthene's value and to eventually sell off its assets,
reputedly worth in excess of $200 million.
Disthene, a holding company, operates the world's largest kyanite
mining concern in Buckingham County and also owns nearly 30,000
acres of forestland and the Cavalier Hotel complex in Virginia
Beach. Kyanite is a valued mineral in great abundance in ridges
and mountainous terrain south of Dillwyn.
Kyanite Mining Corp. has been operated by the Dixon family in
Buckingham for four generations.
The report says Disthene was sued by three minority shareholders
who successfully argued that Dixon family members oppressed
minority shareholders, spent lavishly on themselves, depressed
stock values and ignored minority interests in the company.
According to Richmond Times-Dispatch, Disthene is appealing the
lower court decision to the state Supreme Court, but it was not
immediately clear whether liquidation proceedings could continue
if the Supreme Court decides to accept the appeal. Any sale of
assets valued at more than $1 million would have to be approved by
the Fairfax County Circuit Court judge who issued the dissolution
order this month, the report notes.
Another circuit court judge has ordered Gene B. Dixon Jr. and his
son to appear before him next month to show why they are not in
violation of a settlement agreement involving various stock
transfers and payments due minority interests, adds Richmond
Times-Dispatch.
DUNE ENERGY: Whitebox Advisors Discloses 5.5% Equity Stake
----------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Whitebox Advisors, LLC, and its affiliates disclosed
that, as of Sept. 30, 2012, they beneficially own 2,174,2
68 shares of common stock of Dune Energy Inc. representing 5.52%
of the shares outstanding. A copy of the filing is available at:
http://is.gd/K8YsL4
About Dune Energy
Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/
-- is an independent energy company based in Houston, Texas.
Since May 2004, the Company has been engaged in the exploration,
development, acquisition and exploitation of natural gas and crude
oil properties, with interests along the Louisiana/Texas Gulf
Coast. The Company's properties cover over 90,000 gross acres
across 27 producing oil and natural gas fields.
The Company reported a net loss of $60.41 million in 2011,
compared with a net loss of $75.53 million in 2010.
The Company's balance sheet at June 30, 2012, showed
$246.60 million in total assets, $123.28 million in total
liabilities, and $123.31 million in total stockholders' equity.
* * *
As reported by the TCR on Dec. 27, 2011, Standard & Poor's Ratings
Services lowered its corporate credit rating on Dune Energy Inc.
to 'SD' (selective default) from 'CC'.
"The rating actions follow the company's announcement that it has
completed the exchange offer for its 10.5% senior notes due 2012,
which we consider a distressed exchange and tantamount to a
default," said Standard & Poor's credit analyst Stephen Scovotti.
"Holders of $297 million of principle amount of the senior secured
notes exchanged their 10.5% senior secured notes for common stock,
which in the aggregate constitute 97.0% of Dune's common stock
post-restructuring, and approximately $49.5 million of newly
issued floating rate senior secured notes due 2016. We consider
the completion of such an exchange to be a distressed exchange
and, as such, tantamount to a default under our criteria."
In the Jan. 2, 2012, edition of the TCR, Moody's Investors Service
revised Dune Energy, Inc.'s Probability of Default Rating (PDR) to
Caa3/LD from Ca following the closing of the debt exchange offer
of the company's 10.5% secured notes. Simultaneously, Moody's
upgraded the Corporate Family Rating (CFR) to Caa3 reflecting
Dune's less onerous post-exchange capital structure and affirmed
the Ca rating on the secured notes. The revision of the PDR
reflects Moody's view that the exchange transaction constitutes a
distressed exchange. Moody's will remove the LD (limited default)
designation in two days, change the PDR to Caa3, and withdraw all
ratings.
EASTMAN KODAK: Oct. 29 Hearing on Accord to End Retiree Benefits
----------------------------------------------------------------
Matthew Daneman at USA TODAY reports there's a hearing Oct. 29 on
Eastman Kodak's motion for approval of a settlement with the
official committee representing retirees.
According to the report, under the deal, Kodak would end retiree
health benefits by year's end. In exchange, Kodak would give the
retiree committee $7.5 million in cash, a $15 million secured
claim and a $635 million unsecured claim. Whatever total the
committee eventually received would be used to subsidize some
benefits. The report notes, if approved by the court, Kodak would
wipe $1.2 billion in obligations off its books and save about $10
million a month in post-employment benefits.
According to the report, Kodak retiree group EKRA, which wasn't
part of the negotiations, criticized the company and the official
retiree committee for not communicating "the direness of the Kodak
situation nor in any way (indicating) the draconian result they
were about to reveal."
The report relates that, for 56,000 Kodak retirees and dependents
worldwide relying on the company for health care benefits, it
would mean a financial wallop. A 2010 study by the Washington-
based Employee Benefit Research Institute found that retirees who
don't have employer subsidies would need upward of $200,000 in
savings just to guarantee they could afford a Medicare subsidy,
and upward of $100,000 to make sure they could cover drug
expenses.
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.
As of July 31, 2012, the Company had total assets of
$3.93 billion, total liabilities of $5.32 billion and total
stockholders' deficit of $1.39 billion.
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.
ECOSPHERE TECHNOLOGIES: Barbara Carabetta Appointed Interim CFO
---------------------------------------------------------------
Ecosphere Technologies, Inc., appointed Barbara Carabetta as
interim Chief Financial Officer on Oct. 3, 2012.
Since August 2011, Ms. Carabetta has served as the Corporate
Controller of the Company and the Company's majority-owned
subsidiary, Ecosphere Energy Services, LLC. From 2005 until she
joined the Company, Ms. Carbetta was a partner at The Malone
Group, a consulting services company that provides professional
services for accounting and financial reporting functions of
public and private companies. While employed at The Malone Group,
Ms. Carabetta served as the interim Corporate Controller of Arby's
and the interim Assistant Corporate Controller of SafeNet, Inc.
Ms. Carabetta is 54 years old and is a Certified Public Accountant
(Michigan-Inactive).
About Ecosphere Technologies
Stuart, Fla.-based Ecosphere Technologies, Inc. (OTC BB: ESPH)
-- http://www.ecospheretech.com/-- is a diversified water
engineering, technology licensing and environmental services
company that designs, develops and manufactures wastewater
treatment solutions for industrial markets. Ecosphere, through
its majority-owned subsidiary Ecosphere Energy Services, LLC
("EES"), provides energy exploration companies with an onsite,
chemical free method to kill bacteria and reduce scaling during
fracturing and flowback operations.
The Company reported a net loss of $5.86 million in 2011,
following a net loss of $22.66 million in 2010, and a net loss of
$19.05 million in 2009.
The Company's balance sheet at June 30, 2012, showed
$11.89 million in total assets, $4.61 million in total
liabilities, $4.03 million in total redeemable convertible
cumulative preferred stock, and $3.25 million in total equity.
EGPI FIRECREEK: Brandon Ray Resigns for Personal Reasons
--------------------------------------------------------
Brandon D. Ray resigned from his positions as director and
executive vice president of finance of EGPI Firecreek, Inc., and
its subsidiaries, effective as of Oct. 1, 2012. Mr. Ray's
resignation from the Board was not due to any disagreement with
the Company, but was made by Mr. Ray for personal reasons.
About EGPI Firecreek
Scottsdale, Ariz.-based EGPI Firecreek, Inc. (OTC BB: EFIR) was
formerly known as Energy Producers, Inc., an oil and gas
production company focusing on the recovery and development of oil
and natural gas.
The Company has been focused on oil and gas activities for
development of interests held that were acquired in Texas and
Wyoming for the production of oil and natural gas through Dec. 2,
2008. Historically in its 2005 fiscal year, the Company initiated
a program to review domestic oil and gas prospects and targets.
As a result, EGPI acquired non-operating oil and gas interests in
a project titled Ten Mile Draw located in Sweetwater County,
Wyoming for the development and production of natural gas. In
July 2007, the Company acquired and began production of oil at the
2,000 plus acre Fant Ranch Unit in Knox County, Texas. This was
followed by the acquisition and commencement in March 2008 of oil
and gas production at the J.B. Tubb Leasehold Estate located in
the Amoco Crawar Field in Ward County, Texas.
The Company reported a net loss of $4.97 million in 2011, compared
with a net loss of $4.48 million in 2010.
The Company's balance sheet at June 30, 2012, showed $2.57 million
in total assets, $6.42 million in total liabilities, all current,
$1.86 million in series D preferred stock, and a $5.71 million
total shareholders' deficit.
In its audit report for the 2011 results, M&K CPAS, PLLC, in
Houston, Texas, noted that the Company has suffered recurring
losses and negative cash flows from operations that raise
substantial doubt about its ability to continue as a going
concern.
ELEPHANT TALK: Five Directors Elected to Board
----------------------------------------------
Elephant Talk Communications Corp. held its 2012 annual
stockholders meeting on Oct. 4, 2012.
All of the five nominees for directors were elected to serve until
the 2013 Annual Meeting of Stockholders or until their respective
successors have been duly elected and qualified, namely, Steven
Van der Velden, Johan Dejager, Phil Hickman, Rijkman Groenink, and
Charles Levine.
The issuance of shares in connection with the potential
conversions and stock payments associated with certain 8% senior
secured convertible notes issued on March 30, 2012, was approved.
The appointment of BDO USA LLP as the Company's independent
registered public accounting firm for the fiscal year ending
Dec. 31, 2012, was ratified and was approved by the stockholders.
Moreover, the stockholders approved the Company's executive
compensation and voted on the proposal to hold a non-binding
advisory vote on executive compensation every three years.
About Elephant Talk
Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK)
-- http://www.elephanttalk.com/-- is an international provider of
business software and services to the telecommunications and
financial services industry.
The Company's balance sheet at June 30, 2012, showed
$44.63 million in total assets, $17.30 million in total
liabilities, and $27.32 million in total stockholders' equity.
Elephant Talk reported a net loss of $25.31 million in 2011, a net
loss of $92.48 million in 2010, and a net loss of $17.29 million
in 2009. The Company reported a net loss of $10.99 million for
the six months ended June 30, 2012.
EL PASO'S FEDERAL: NCUA Placed EPFCU Into Liquidation
-----------------------------------------------------
The National Credit Union Administration on Sept. 28, 2012,
liquidated El Paso's Federal Credit Union (EPFCU) of El Paso,
Texas. NCUA made the decision to liquidate EPFCU and discontinue
operations after determining the credit union was insolvent and
had no prospect for restoring viable operations.
EPFCU member deposits are federally insured by the National Credit
Union Share Insurance Fund up to $250,000. NCUA's Asset
Management and Assistance Center will transfer certain share
accounts to El Paso Area Teachers Federal Credit Union of El Paso,
Texas. El Paso Area Teachers Federal Credit Union is a full-
service credit union with $471 million in assets and serves
approximately 55,000 members.
For non-transferred accounts, NCUA's Asset Management and
Assistance Center will issue checks to individuals holding
verified accounts in the credit union within one week.
Members with additional questions about their insurance coverage
may contact NCUA's Consumer Service hotline toll free at 800-755-
1030. The center answers calls Monday through Friday between
6 a.m. and 3 p.m. (Mountain). Individuals may also visit the
MyCreditUnion.gov website at any time for more information about
their insurance coverage.
EPFCU served 1,035 members and had deposits of approximately
$5 million, according to the credit union's most recent Call
Report. Originally chartered as El Paso Smelter Federal Credit
Union in 1952, EPFCU was a full-service financial institution
serving employees of American Smelting and Refining Company,
select employee groups, and other affinity groups at the time of
closure.
EPFCU is the ninth federally insured credit union liquidation in
2012.
EMISPHERE TECHNOLOGIES: 13% Default Interest Rate Applies
---------------------------------------------------------
Emisphere Technologies, Inc., received notice from MHR Fund
Management LLC that, pursuant to the terms of the Company's 11%
Senior Secured Convertible Notes issued to MHR, the default
interest rate of 13% per annum will apply with respect to the
Senior Secured Convertible Notes, effective as of Sept. 27, 2012.
The notice from MHR follows the Company's failure to pay to MHR
$30.5 million in principal and interest due and payable on
Sept. 26, 2012, under the terms of the Senior Secured Convertible
Notes.
MHR Fund Management LLC and its affiliates beneficially own
38,557,573 shares of common stock of Emisphere Technologies,
representing 47.7% of the shares outstanding as of Oct. 4, 2012.
About Emisphere
Cedar Knolls, N.J.-based Emisphere Technologies, Inc., is a
biopharmaceutical company that focuses on a unique and improved
delivery of therapeutic molecules or nutritional supplements using
its Eligen(R) Technology. These molecules are currently available
or are under development.
The Company's balance sheet at June 30, 2012, showed $2.52 million
in total assets, $64.86 million in total liabilities, and a
stockholders' deficit of $62.34 million.
McGladrey and Pullen, LLP, in New York City, expressed substantial
doubt about Emisphere'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 its total
liabilities exceed its total assets.
ENERGY XXI: S&P Hikes $1BB Note Rating to B+ on Recovery Prospects
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its recovery rating on
the senior unsecured debt of Energy XXI Gulf Coast Inc., a
subsidiary of Energy XXI (Bermuda) Ltd., to '4' from '5'. "The '4'
recovery rating reflects our expectation that creditors would
receive an average (30% to 50%) recovery in the event of a payment
default. As a result, we have raised our rating on Energy XXI Gulf
Coast's $750 million 9.25% notes and $250 million 7.75% notes to
'B+' from 'B'," S&P said.
"Our 'B+' corporate credit rating and stable outlook on Energy XXI
(Bermuda) Ltd. are unchanged," S&P said.
"The upgrade of the senior unsecured issues and revised recovery
ratings reflect the higher recovery valuation following the
implementation of our recently revised price and recovery
methodology for exploration and production companies. Our recovery
analysis incorporated an updated PV-10 valuation based on June 30,
2012, proven reserves," S&P said.
RATING LIST
Rating Raised; Recovery Rating Revised
To From
Energy XXI Gulf Coast Inc.
Senior unsecured notes B+ B
Recovery rating 4 5
F1 SPEEDWAY: Is Insolvent; To Liquidate Assets
-----------------------------------------------
Linda Moss at NorthJersey.com reports that F1 Speedway LLC, which
did business as Velocity 17, is insolvent and is liquidating its
assets, leaving a long trail of creditors and about $2.8 million
in debt.
Velocity 17 in July vacated the 100,000-square-foot site it had
rented for five years at 87 Route 17 south. The track and
entertainment center agreed to leave the premises as part of a
settlement with the building's owner, SWS Realty Associates of
Rutherford, NorthJersey.com relates.
In August, NorthJersey.com recalls, Velocity 17 agreed to an
"assignment for benefit of creditors," a legal proceeding that
allows a financially ailing company to avoid bankruptcy and
quickly settle its debts with creditors. The case is before
Superior Court Judge Robert Contillo in the probate section of the
Chancery Division in Hackensack, says NorthJersey.com.
Jerry Joseph was the sole principal of Velocity 17. Steven
Jurista is the attorney named assignee for the case.
"The assignor corporation [Velocity 17] has ceased operations,"
according to court filings obtained by NorthJersey.com.
NorthJersey.com discloses that SWS Realty is first on a list of
roughly 20 unsecured creditors owed money by Velocity 17, with the
landlord claiming to be owed $2.5 million in back rent. In total,
Velocity 17 had about $2.8 million in debt listed in court papers,
NorthJersey.com notes.
"We're still owed the money," the report quotes attorney James
Sonageri, who represents SWS Realty, as saying. "The law provides
the debtor to pursue this course of action, and we have to follow
the law."
Velocity 17 formerly owned indoor go-kart raceway on Route 17 in
Maywood.
FUEL DOCTOR: Had $296,300 Net Loss in Second Quarter
----------------------------------------------------
Fuel Doctor Holdings, Inc., filed its quarterly report on Form 10-
Q, reporting a net loss of $296,339 on $113,732 of net revenues
for the three months ended June 30, 2012, compared with a net loss
of $723,754 on $274,298 of net revenues for the same period last
year. The decrease in net loss was primarily attributable to an
overall reduction in advertising and promotion and a reduction in
total overhead expenses during 2012.
For the six months ended June 30, 2012, the Company had a net loss
of $594,315 on $335,147 of net revenues, compared with a net loss
of $1.2 million on $618,305 of net revenues for the corresponding
period of 2011.
The Company's balance sheet at June 30, 2012, showed $1.5 million
in total assets, $1.6 million in total liabilities, and a
stockholders' deficit of $142,893.
At June 30, 2012, and Dec. 31, 2011, the Company had an
accumulated deficit of $(1,664,698) and $(1,070,383),
respectively.
"We believe that we will require additional financing to carry out
our intended objectives during the next twelve months. There can
be no assurance, however, that such financing will be available
or, if it is available, that we will be able to structure such
financing on terms acceptable to us and that it will be sufficient
to fund our cash requirements until we can reach a level of
profitable operations and positive cash flows. If we are unable
to obtain the financing necessary to support our operations, we
may be unable to continue as a going concern. We currently have
no firm commitments for any additional capital."
A copy of the Form 10-Q is available at http://is.gd/NkLneW
About Fuel Doctor
Calabasas, Calif.-based Fuel Doctor Holdings, Inc., is the
exclusive distributor for the United States and Canada of a fuel
efficiency booster (the FD-47), which plugs into the lighter
socket/power port of a vehicle and increases the vehicle's miles
per gallon through the power conditioning of the vehicle's
electrical systems. The Company has also developed, and plans on
continuing to develop, certain related products.
Fuel Doctor reported a net loss of $2.69 million in 2011,
compared with a net loss of $2.48 million in 2010.
Rose, Synder & Jacobs LLP, in Encino, California, issued a "going
concern" qualification on the consolidated financial statements
for the period ended Dec. 31, 2011. The indepdent auditors noted
that the Company has sustained recurring operating losses,
continues to consume cash in operating activities, and has an
accumulated deficit at Dec, 31, 2011, which conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
FUELSTREAM INC: Obtains $423,000 Financing from Investor
--------------------------------------------------------
Fuelstream, Inc., entered into a Securities Purchase Agreement
with an accredited investor, the nature and purpose of which is to
provide up to $423,000 in financing to the Company in exchange for
certain 3-year convertible debentures of the Company in the
aggregate principal amount of $470,000, bearing interest at 6% per
annum, together with restricted shares of common stock of the
Company with a value of up to $47,000.
In addition, the Company will pay the Investor a fee consisting of
$10,000 and 15,000 shares of restricted common stock in connection
with the Investor's due diligence review of the Company, and
reimburse the Investor for $10,000 in legal fees incurred by the
Investor. Pursuant to the SPA, the Company is required to file a
registration statement with the Securities and Exchange
Commission.
The first of the Debentures, with an aggregate principal amount of
$120,000, was issued on Oct. 2, 2012. Additional debentures, with
a principal amount not exceeding $350,000 in the aggregate, may be
issued by the Company upon: (i) the filing of the Registration
Statement with the SEC, and (ii) the SEC declaring the
Registration Statement to be effective. Each of the Debentures,
if not redeemed by the Company, is convertible, in whole or in
part, into shares of common stock at either 60% or 75% (depending
on the debenture) of the lowest closing bid price of the Company's
shares for the 20 trading days prior to that conversion. The
Debentures are redeemable by the Company at 120%-140% of the
principal amount, depending on the date of redemption, together
with interest as accrued.
No solicitation was made and no underwriting discounts were given
or paid in connection with these transactions. The Company
believes that the issuance of the shares was exempt from
registration with the Securities and Exchange Commission pursuant
to Section 4(2) of the Securities Act of 1933.
About Fuelstream
Draper, Utah-based Fuelstream, Inc., is an in-wing and on-location
supplier and distributor of aviation fuel to corporate,
commercial, military, and privately-owned aircraft throughout the
world. The Company also provides a variety of ground services
either directly or through its affiliates, including concierge
services, passenger andbaggage handling, landing rights,
coordination with local aviation authorities, aircraft maintenance
services, catering, cabin cleaning, customsapprovals, and third-
party invoice reconciliation. The Company's personnel assist
customers in flight planning and aircraft routing aircraft,
obtaining permits, arranging overflies, and flight follow
services.
The Company's balance sheet at June 30, 2012, showed $3.1 million
in total assets, $4.9 million in total liabilities, and a
stockholders' deficit of $1.8 million.
The accumulated deficit as of June 30, 2012, was $33.0 million and
the total stockholders' deficit at June 30, 2012 was
$1.8 million.
Morrill & Associates, LLC, in Bountiful, Utah, expressed
substantial doubt about Fuelstream'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 negative working capital, negative cash flows from
operations and recurring operating losses.
GENELINK INC: Jon Marshall Discloses 13% Equity Stake
-----------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Jon A Marshall disclosed that, as of Sept. 28, 2012,
he beneficially owns 41,666,667 shares of common stock of
GeneLink, Inc., representing 13% of the shares outstanding.
A copy of the filing is available at http://is.gd/uy9yZI
About Genelink
Based in Orlando, Fla., GeneLink, Inc., is a solution provider in
the genetically customized nutritional and personal care
marketplace.
Hancock Askew & Co., LLP, in Savannah, Georgia, expressed
substantial doubt about GeneLink'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 deficit of $436,310, has incurred recurring
operating losses since inception including a loss of $3.8 million
in 2011 and had an accumulated deficit at Dec. 31, 2011, of
$24,560,315.
The Company's balance sheet at June 30, 2012, showed $2.12 million
in total assets, $4.41 million in total liabilities and a $2.29
million total stockholders' deficit.
GEOPETRO RESOURCES: Has Until Dec. 31 to Regain NYSE Compliance
---------------------------------------------------------------
GeoPetro Resources Company disclosed that it has received a
favorable determination from the NYSE MKT LLC with regard to its
continued listing. On Oct. 9, 2012, the NYSE MKT notified the
Company that the Exchange has determined that, in accordance with
Section 1009 of the Company Guide, the Company made a reasonable
demonstration of its ability to regain compliance with Section
1003(a) (iv) of the Company Guide by the end of the revised plan
period, which is now determined by the Exchange to be Dec. 31,
2012. As a result, the NYSE MKT is continuing the Company's
listing pursuant to this extension.
The Company will be subject to periodic reviews by the NYSE MKT
during the extension period covered by the plan. Failure to make
progress consistent with the plan or to regain compliance with
continued listing standards by the end of the extension period
could result in the Company being delisted from the Exchange.
The Company had earlier received notice on June 28, 2012 from the
Exchange that the Company was not in compliance with Section
1003(a)(iv) of the Exchange's Company Guide in that the Exchange
believes that the Company has sustained losses which are so
substantial in relation to its overall operations or its existing
financial resources, or its financial condition has become so
impaired that it appears questionable, in the opinion of the
Exchange, as to whether it will be able to continue operations
and/or meet its obligations as they mature.
The Company was afforded the opportunity to submit a plan of
compliance, which the Company submitted on July 30, 2012. On Aug.
27, 2012, the Exchange notified the Company that it accepted the
Company's plan of compliance and granted the Company until Sept.
28, 2012 to regain compliance with the continued listing
standards. This date has now been extended to Dec. 31, 2012.
About GeoPetro
GeoPetro is an independent oil and natural gas company
headquartered in San Francisco, California. GeoPetro currently
has projects in the United States, Canada and Indonesia. GeoPetro
has developed an oil and gas property in its Madisonville Field
Project in Texas. Elsewhere, GeoPetro has assembled a
geographically-diversified portfolio of exploratory and appraisal
prospects.
GLYECO INC: To Buy Glycol-Related Assets of ARI, Renew Resources
----------------------------------------------------------------
GlyEco, Inc., entered into separate asset purchase agreements to
acquire the glycol-related assets of Antifreeze Recycling, Inc.,
and Renew Resources, LLC. The Agreements supersede the terms of
the preliminary agreements the parties previously entered. The
transactions are expected to close on Oct. 26, 2012.
ARI operates a business located in Tea, South Dakota, relating to
processing used glycol streams, primarily used antifreeze, and
selling glycol as remanufactured product.
Renew Resources operates a business located in Rock Hill, South
Carolina, involving the collection and recycling of several types
of waste material, including waste glycol. The Agreement concerns
Renew Resources' waste glycol recycling business, relating to the
processing of used glycol steams, primarily used antifreeze, and
selling glycol as remanufactured product.
The aggregate purchase price for the ARI Assets will be $450,000
and the purchase price for the Renew Resources Assets will be
$325,000.
A copy of the ARI Agreement is available for free at:
http://is.gd/f6gMvk
A copy of the Renew Resources Agreement is available at:
http://is.gd/MVkdFw
About GlyEco, Inc.
Phoenix, Ariz.-based GlyEco, Inc., is a green chemistry company
formed to roll-out its proprietary and patent pending glycol
recycling technology that transforms waste glycols, a hazardous
material, into profitable green products.
Jorgensen & Co., in Lehi, Utah, expressed substantial doubt about
GlyEco'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 not yet achieved
profitable operations and is dependent on the Company's ability to
raise capital from stockholders or other sources and other factors
to sustain operations.
The Company's balance sheet at June 30, 2012, showed $1.1 million
in total assets, $2.1 million in total liabilities, and a
stockholders' deficit of $950,887.
GULFPORT ENERGY: S&P Assigns 'B-' CCR; Rates $250MM Notes 'CCC+'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' corporate
credit rating to Oklahoma City -based Gulfport Energy Corp. The
outlook is negative.
"At the same time, we assigned a 'CCC+' issue rating to Gulfport's
proposed $250 million senior unsecured notes due 2020. We assigned
a '5' recovery rating to the notes, indicating our expectation of
modest (10% to 30%) recovery in the event of a payment default,"
S&P said.
"The ratings on Gulfport reflect the company's very small reserve
and production base; limited reserve and production
diversification; aggressive capital spending plans; very short
reserve life; and the volatility and capital intensive nature of
the oil and gas industry," said credit analyst Stephen Scovetti.
"Our ratings also reflect Gulfport's liquids-rich production
base and relatively low leverage."
"The negative outlook reflects the future prospects for the
company's Utica shale strategy. Both Gulfport and the industry in
general have relatively little production history in the Utica,
given the infancy of the shale's development. We would consider a
negative rating action if the company is unsuccessful in its Utica
shale development and is unable to book a meaningful level of
reserves that would extend its reserve life. If it fails to do so,
we believe the company could face liquidity as well as production
sustainability issues, given the company's already short reserve
life," S&P said.
HD SUPPLY: Intends to Redeem $930-Mil. of Sr. Subordinated Notes
----------------------------------------------------------------
HD Supply, Inc., gave notice of conditional partial redemption
of $930 million aggregate principal amount of its outstanding
13.5% Senior Subordinated Notes due 2015.
The redemption price with respect to any redeemed Note will be
equal to 103.375% of the principal amount of that Note, plus
accrued but unpaid interest thereon to the Redemption Date.
The redemption is subject to the satisfaction of specified
conditions precedent, including, without limitation, consummation,
on or prior to the Redemption Date of the issuance or borrowing of
new indebtedness in an aggregate principal amount of $1,000
million from one or more sources on terms and conditions
satisfactory in all respects to the Company in its sole and
absolute discretion. That redemption will not occur in the event
that the conditions precedent have not been so satisfied by
Dec. 10, 2012.
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 July 29, 2012, showed $6.63 billion
in total assets, $7.47 billion in total liabilities, and a
$834 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.
HEMCON MEDICAL: Can Obtain Financing to Finance Premiums Payment
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon authorized
HemCon Medican Technologies Inc., to obtain postpetition financing
from Imperial Credit Corporation to finance the payment of
premiums paid upon Debtor's insurance policies and to grant to
Imperial a first priory interest in the Policies.
In the event that returned or unearned premiums or other amounts
due under the Policies are insufficient to pay the total amount
owing by Debtor to Imperial, any remaining amount owing to
Imperial, including reasonable attorneys' fees and costs, will be
an allowed claim in this case with priority as an administrative
expense pursuant to Section 503(b)(1) of the Bankruptcy Code.
About HemCon Medical Technologies
Portland, Oregon-based HemCon Medical Technologies Inc., fdba
HemCon, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Ore. Case No. 12-32652) on April 10, 2012, estimating up to
$50 million in assets and liabilities. Founded in 2001, HemCon --
http://www.hemcon.com/-- is a diversified medical technology
company that develops, manufactures and markets innovative wound
care, anti-microbial and oral care products for the military,
emergency medical, surgical, dental and over-the-counter markets.
HemCon has subsidiaries in the United Kingdom and Europe.
The bankruptcy filing comes after an en banc decision by the U.S.
Court of Appeals for the Federal Circuit on March 15, 2012, which
affirmed an award of $34.2 million in damages to Marine Polymer
Technologies Inc. in a patent infringement case initiated in 2006.
HemCon's European subsidiary is not subject to the Chapter 11
proceedings.
Judge Elizabeth L. Perris presides over the case. Attorneys at
Tonkon Torp LLP represent the Debtor. The petition was signed by
Nick Hart, CFO.
Robert D. Miller Jr., U.S. Trustee for Region 18 appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of HemCon Medical Technologies, Inc. The
Committee has appointed Marine Polymer as its chair.
HEMCON MEDICAL: Final Hearing on Access to Cash Set for Oct. 18
---------------------------------------------------------------
A final hearing on HemCon Medial Technologies Inc.'s motion for
authority to use cash collateral will be held on Oct. 18, 2012, at
2:00 p.m.
As reported in the TCR on July 25, 2012, Judge Elizabeth Perris
granted Debtor authorization to use cash collateral of Bank of
America, N.A., as Administrative Agent, on an interim basis, or
until Oct. 7, 2012.
As reported by the Troubled Company Reporter on June 7, 2012, the
Debtor and its affiliates are borrowers under a $50 million
syndicated credit facility where BofA is the administrative agent.
The loan is secured by effectively all of the Debtor's personal
property. As of the petition, HemCon owes the lenders $23 million
under the loan. BofA noted that based on the Debtor's budget, the
Debtor had $1.24 million in cash on the petition date.
The Debtor will grant the bank a replacement security interest in
and lien upon all of Debtor's personal property, except the
deposit account where prepayments made and to be made by the
United States of America, Department of Defense, to the Debtor
pursuant to certain contracts are deposited.
All existing cash collateral and all post-petition receipts
(except prepayments or advances from the United States of America,
Department of Defense, that are deposited into the Defense
Department Deposit Account and Excluded Property) will be
deposited in a segregated Debtor-in-Possession cash collateral
account to be established at BofA. The Debtor is authorized to
draw upon or transfer funds from the Cash Collateral Account to
its Debtor-In-Possession General Operating Account at BofA for
use.
To the extent the adequate protection provided to BofA in the form
of the security interests and liens granted proves to be
inadequate, BofA will be entitled to an administrative expense
claim.
About HemCon Medical Technologies
Portland, Oregon-based HemCon Medical Technologies Inc., fdba
HemCon, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Ore. Case No. 12-32652) on April 10, 2012, estimating up to
$50 million in assets and liabilities. Founded in 2001, HemCon --
http://www.hemcon.com/-- is a diversified medical technology
company that develops, manufactures and markets innovative wound
care, anti-microbial and oral care products for the military,
emergency medical, surgical, dental and over-the-counter markets.
HemCon has subsidiaries in the United Kingdom and Europe.
The bankruptcy filing comes after an en banc decision by the U.S.
Court of Appeals for the Federal Circuit on March 15, 2012, which
affirmed an award of $34.2 million in damages to Marine Polymer
Technologies Inc. in a patent infringement case initiated in 2006.
HemCon's European subsidiary is not subject to the Chapter 11
proceedings.
Judge Elizabeth L. Perris presides over the case. Attorneys at
Tonkon Torp LLP represent the Debtor. The petition was signed by
Nick Hart, CFO.
Robert D. Miller Jr., U.S. Trustee for Region 18 appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of HemCon Medical Technologies, Inc. The
Committee has appointed Marine Polymer as its chair.
HEMCON MEDICAL: Final Hearing on Disclosures Reset to Oct. 18
-------------------------------------------------------------
The hearing to consider the approval of the disclosure statement
filed by HemCon Medical Technologies, Inc., explaining its Chapter
11 Plan of Reorganization has been rescheduled for Oct. 18, 2012,
at 2:00 p.m.
According to the Disclosure Statement, dated July 2, 2012, the
reorganized Debtor will recapitalize by raising $8 million to
$12 million in new capital.
The Debtor plans to sell between 1 million and 1.5 million shares
of Series A Preferred Stock to angel investors (including
unsecured creditors and equity security holders), and sell between
2 million and 3 million shares to private equity funds or other
institutional investors. A total of between 3 million and 4.5
million shares is expected to be sold in the offering.
The Series A Preferred Shares will be issued at approximately
$2.50 per share. It will have a liquidation preference of par
plus 5% per annum per share and be converted into Common Stock
when the Company conducts a public offering of its Common Stock at
a price of at least $7.50 per share.
The Company has already engaged in substantial discussions with
various parties and received a written indication of interest from
private equity.
Common Shares
Holders of general unsecured claims, which are impaired under the
Plan, will be issued approximately a total of $1.1 million shares
of common stock. Common stock will be issued at the rate of one
share for each $50 of unsecured debt.
One million shares of new common stock will be reserved for
issuance under potential stock options for employees and directors
for post-Effective Date services as stock options, restricted
stock, or other stock-based grants.
HemCon is planning to increase the number of employees post-
confirmation in support of its lyophilized dried plasma product
and to a limited extent in the areas of sales force,
manufacturing, regulatory affairs, and new product development.
Other Claims and Interest
Each holder of an unsecured claim equal to or less than $5,000 or
who elects to reduce his unsecured claim to $5,000 will not
receive shares but will instead be paid 50% of the allowed amount
of the claim within 60 days following the later of the effective
date.
Bank of America, as administrative agent, holds a secured claim on
account of debt owed to BoA, Bank of the West and Silicon Valley
Bank. The secured claim will be fixed at $5 million and payable
with interest from and after the Effective Date at a fixed rate
equal to 4.5% per annum with interest-only payments on a monthly
basis until the fifth anniversary of the Effective Date, at which
time the principal balance and any remaining unpaid interest will
be paid. The claim will continue to be secured by a security
interest in Reorganized Debtor's assets of the same kind and
category and with the same priority that it held as of the
Petition Date. The amount of debt in excess of BoA's allowed
secured claim will be treated as a general unsecured claim.
Holders of equity securities will not be entitled to any
distributions on account of their existing interests, although
they will have the opportunity to acquire Series A Preferred Stock
in Reorganized Debtor.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/Hemcon_Medical_Plan_Outline.pdf
About HemCon Medical Technologies
Portland, Oregon-based HemCon Medical Technologies Inc., fdba
HemCon, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Ore. Case No. 12-32652) on April 10, 2012, estimating up to
$50 million in assets and liabilities. Founded in 2001, HemCon --
http://www.hemcon.com/-- is a diversified medical technology
company that develops, manufactures and markets innovative wound
care, anti-microbial and oral care products for the military,
emergency medical, surgical, dental and over-the-counter markets.
HemCon has subsidiaries in the United Kingdom and Europe.
The bankruptcy filing comes after an en banc decision by the U.S.
Court of Appeals for the Federal Circuit on March 15, 2012, which
affirmed an award of $34.2 million in damages to Marine Polymer
Technologies Inc. in a patent infringement case initiated in 2006.
HemCon's European subsidiary is not subject to the Chapter 11
proceedings.
Judge Elizabeth L. Perris presides over the case. Attorneys at
Tonkon Torp LLP represent the Debtor. The petition was signed by
Nick Hart, CFO.
Robert D. Miller Jr., U.S. Trustee for Region 18 appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of HemCon Medical Technologies, Inc. The
Committee has appointed Marine Polymer as its chair.
HOSTESS BRANDS: Files Plan of Reorganization
--------------------------------------------
Hostess Brands Inc. disclosed that the Company and its five
subsidiaries have filed their Joint Plan of Reorganization and
related Disclosure Statement with the U.S. Bankruptcy Court for
the Southern District of New York.
The Disclosure Statement includes detailed information regarding
labor agreements, the treatment of claims and interests, the
Company's business plan, and events leading up to and during
Hostess' Chapter 11 cases. The Plan and Disclosure Statement
remain subject to further modifications and approval by the Court.
"The filing of the Plan and Disclosure Statement is a major
milestone for Hostess, our employees, suppliers and customers,"
said Gregory F. Rayburn, the Company's Chairman and Chief
Executive Officer. "The Plan sets forth the blueprint for Hostess
to emerge from bankruptcy. We will continue to work toward
putting the pieces in place for that emergence so that we can
thrive again as a robust competitor and continue to serve our
loyal customers for years to come."
"Demand for Hostess products has been very resilient, giving us a
solid base to work from," Mr. Rayburn said. "With a competitive
cost structure and fresh capital at our disposal, we can begin to
make the kinds of investments in our business that is essential to
our future success."
Mr. Rayburn said Hostess is working to complete its restructuring
and exit Chapter 11 in the next few months, provided the Plan is
confirmed by the Court overseeing the Company's restructuring.
"I'd like to thank our employees for their continued hard work and
commitment," Mr. Rayburn said. "Every single Hostess employee has
made sacrifices to preserve jobs and improve the Company's
financial strength. Upon emergence, our union-represented
employees will hold 25 percent equity ownership, a $100 million
interest-bearing note and have two seats on the Board of Directors
on critical committees to ensure their voice is heard."
Jacqueline Palank at Dow Jones Newswires reports Hostess, which
last week won court approval to impose new labor terms on its
second-biggest union, has filed a plan that would hand 75%
ownership of the reorganized company to a group of existing
lenders led by Silver Point Finance LLC. The unions would get the
remaining 25% stake. General unsecured creditors, owed between $2
billion and $2.5 billion, are slated to go unpaid under the plan.
Ripplewood Holdings and Hostess's other equity owners would see
their shares canceled and wouldn't recover anything under the
plan.
The report also says the plan lays out changes to Hostess's
operations and balance sheet. Specifically, the company plans to
close several bakeries, upgrade its delivery fleet and close
unprofitable retail stores.
Dow Jones notes Hostess will use the plan to whittle down its
$861.5 million in secured debt to $697 million. The new debt is
expected to include $45 million in bankruptcy-exit financing,
about $362 million in new first-lien debt and nearly $290 million
in new third-lien debt. Of the new third-lien debt, $100 million
will go to Hostess's unions.
According to the report, Hostess said the plan requires
"sacrifices at virtually all stakeholder levels' in order to
preserve "one of America's oldest and most iconic baking
companies."
The report relates Gregory F. Rayburn, Hostess's chairman and
chief executive, said Hostess hopes to exit Chapter 11 in the next
few months.
The report adds, while the company last week won court approval to
impose new labor terms on its second-biggest union, the Bakery,
Confectionery, Tobacco Workers & Grain Millers International
Union, the threat looms large that the union will strike in
response. The company said it expects the new labor terms to help
it save more than $171 million per year.
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.
HUDSON VALLEY HOTEL: Former Clarion Hotel Files Chapter 11
----------------------------------------------------------
Jessica DiNapoli at The Herald Record reported that Hudson Valley
Hotel & Conference Center, a former Clarion Hotel, has filed for
Chapter 11 bankruptcy a few days before a scheduled foreclosure
sale of the property.
According to the report, Hudson Valley came into financial trouble
in 2009. The recession diminished the business' revenue, and the
hotel lost its brand-name flag.
The report notes Hudson Valley Federal Credit Union, which claims
the hotel owes it about $3 million, last year began foreclosure
proceedings against the 13-acre property. A foreclosure sale of
the 120-room hotel was scheduled for Oct. 5, but the bankruptcy
filing halted that proceeding.
HYLAND SOFTWARE: S&P Lowers CCR to 'B' on Debt Refinancing
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Westlake, Ohio-based Hyland Software Inc. to 'B' from
'B+'. The outlook is stable.
"We also assigned a 'B' issue-level rating to with a recovery
rating of '3', indicating expectations of meaningful (50% to 70%)
recovery of principal in the event of a payment default, to the
company's proposed $320 million first-lien term loan and $20
million revolving credit facility," S&P said.
"In addition, we are assigning a 'CCC+' issue-level rating with a
recovery rating of '6', indicating expectations of negligible
recovery (0% to 10%), to the company's proposed $235 million
second-lien term loan," S&P said.
"The rating reflects our view of Hyland's limited operational
scale and relatively modest competitive position, with respect to
much larger competitors with significantly more resources in the
fragmented enterprise content management (ECM) industry," said
Standard & Poor's credit analyst Jacobs Schlanger. The company's
predictable recurring revenue stream, stemming from high license
renewal rates and favorable business segment growth, provides
rating stability.
"Hyland's outlook is stable, reflecting its predictable operating
performance and aggressive leverage that we think is unlikely to
materially drop over the next 12 to 18 months. We could lower the
rating if customer defections or losses, pricing pressure related
to increased competition in the marketplace or a weak economy,
result in margin erosion and debt leverage above 8x. The company's
second-tier position in the ECM market and limited scale limit a
possible upgrade in the next year," S&P said.
IMS HEALTH: S&P Cuts Corp. Credit Rating to 'B+'; Outlook Stable
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on IMS Health Inc., a Danbury, Conn.-based provider of
information, services and technology for the healthcare industry,
to 'B+' from 'BB-'. The outlook is stable.
"At the same time, we lowered our issue-level rating on the
existing term loan B to 'BB-' in conjunction with the downgrade.
The recovery rating is unchanged at '2', indicating our
expectation for substantial (70% to 90%) recovery in the event of
payment default. We also lowered our issue-level rating on the
existing unsecured notes to 'B' in conjunction with the downgrade.
The recovery rating on this debt is unchanged at '5' (10% to 30%
recovery expectation)," S&P said.
"We assigned the company's proposed $750 million term loan B our
'BB-' issue-level rating with a recovery rating of '2' (70% to 90%
recovery expectation). We also assigned the proposed $500 million
senior unsecured notes our 'B' issue-level rating with a recovery
rating of '5 (10% to 30% recovery expectation)," S&P said.
"The rating downgrade follows the company's announcement that it
will be issuing $1.25 billion of additional debt to fund a sponsor
dividend. TPG, the Canadian Pension Board, and Leonard Green &
Partners acquired the company in February 2010. Pro forma leverage
will increase to 5.7x, slightly higher than the leverage incurred
when the sponsors acquired the company in 2010, and a departure
from our expectation that leverage would remain below 5x on an
ongoing basis," S&P said.
"The rating on IMS Health Inc. reflects its 'highly leveraged'
financial risk profile (according to Standard & Poor's Ratings
Services' criteria), highlighted by our expectation of leverage
sustained at more than 5x over the near term. We believe IMS has a
'satisfactory' business risk profile because of its dominant
position as a provider of critical information to the
pharmaceutical market, offset by its narrow focus in providing
information primarily to that market," S&P said.
"Despite its strong competitive position, IMS is narrowly tied to
demand from its pharmaceutical clients. It could be susceptible to
pharmaceutical industry dynamics, such as pharmaceutical merger
and acquisition (M&A) activity and the success of new product
launches/near-term product pipelines. The industry is stabilizing
after a period of cost cutting and streamlining, but we still
believe the industry could struggle to grow over the near term.
This is reflected in our expectation of low-single-digit organic
revenue growth over the next one to two years. IMS' margins will
expand by about 100 basis points over that time because of the
shift in service mix, aided by organic growth and continued cost
reductions. Although a small part of IMS' business, demand for
discretionary consulting services will likely remain muted by the
industry's focus on cost, after the record amount of drugs losing
patent protection through 2012. Generic drug companies, which
benefit from the loss of patent protection on branded drugs,
typically use fewer consulting services, but after 2012, demand
for this key service could grow if pipelines of the major
pharmaceutical companies improve," S&P said.
INFUSYSTEM HOLDINGS: Amends Employment Pact with CEO, President
---------------------------------------------------------------
Upon the recommendation of the Compensation Committee and approval
by the Board of Directors, InfuSystem Holdings, Inc., and Dilip
Singh entered into, effective Oct. 24, 2012, an amended and
restated employment agreement with the Company which amends the
Singh Employment Agreement in the following ways:
(i) The Term of the First Amendment is extended on a month to
month basis up to a period of four months with a salary
equal to $300,000 per annum from the Effective Date;
(ii) Mr. Singh is eligible for a performance bonus up to
approximately $167,000, at the discretion of the Board; and
(iii) In the case of certain events, the Company will pay to Mr.
Singh a lump sum of $375,000.
The Board appointed Mr. Singh to the position of Interim Chief
Executive Officer and President of the Company, effective April
24, 2012. In connection therewith, the Company entered into an
Employment Agreement with Mr. Singh which provided for an initial
employment term of six months.
A copy of the Employment Agreement, as amended, is available at:
http://is.gd/Mt2Tov
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 June 30, 2012, showed $74.72
million in total assets, $35.52 million in total liabilities and
$39.20 million in total stockholders' equity.
INSIGHT GLOBAL: S&P Cuts CCR to 'B' on Ares Acquisition Plan
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Atlanta, Ga.-based Insight Global to 'B' from 'B+'
following the company's announcement that it will be acquired by
private-equity investor Ares Management LLC. The rating outlook is
stable.
"At the same time, we assigned holding company IG Investments
Holdings LLC our 'B' corporate credit rating. The outlook is
stable," S&P said.
"We also assigned IG Investments Holdings' proposed $360 million
first-lien credit facilities our 'B' issue-level rating (at the
same level as our 'B' corporate credit rating on the company). The
recovery rating on this debt is '3', indicating our expectation
for meaningful (50% to 70%) recovery for lenders in the event of a
payment default. The first-lien facility consists of a $60 million
revolving credit facility due 2017 and a $300 million term loan
due 2019," S&P said.
"We also assigned IG Investments Holdings' proposed $130 million
second-lien term loan due 2020 our 'CCC+' issue-level rating (two
notches lower than our 'B' corporate credit rating on the
company). The recovery rating on this debt is '6', indicating our
expectation of negligible (0% to 10%) recovery for lenders in the
event of a payment default," S&P said.
"The downgrade reflects Standard & Poor's view that higher debt
and interest expense associated with the Ares' acquisition of
Insight Global will weaken the company's financial profile and
increase lease-adjusted pro forma debt leverage to the mid-6x
area. Still, we expect operating performance will continue to be
good over the near-to-intermediate term because of growing demand
for information technology staffing, the company's above average
growth rates, and relatively high EBITDA margins. The 'B' rating
on IG Investments Holdings reflects our expectation that its
financial profile will be 'highly leveraged' because of its
private-equity ownership and substantial debt leverage. Further
considerations include the company's likely modest discretionary
cash flow as a result of higher interest expense and receivable
funding needs, and risks associated with its planned office
network expansion. We regard the business profile as 'weak' (based
on our criteria), weighing its small, niche market position in the
highly competitive and fragmented staffing industry, risks related
to its rapid organic growth, and vulnerability of revenue to
economic cycles. Still, we expect its EBITDA margin will remain
above that of peers, based on management's track record of coping
with competitive industry conditions," S&P said.
"Insight Global provides IT staffing services to Fortune 1000
companies through 28 regional offices in major metropolitan
markets, with a market share of only about 3% in the IT staffing
industry. Revenues from the technology, media, and
telecommunications sectors account for almost two-thirds of the
company's sales, exposing the company to structural trends in
those industries. The company faces intense competition from the
IT divisions of well-capitalized, general staffing firms, which
are cross-selling IT personnel services to their existing client
base. The company's top 10 customers account for slightly more
than one-third of sales, representing a concentration risk.
Engagements are generally short term, lasting a few months, and
nonexclusive based on industry practice, hampering operating
visibility. Industry consolidation could result in reduced volume
from some large clients. Pricing pressures stemming from the
competitive nature of the industry make ongoing cost management a
key priority," S&P said.
ISE CORPORATION: District Court Rejects Maxwell Appeals
-------------------------------------------------------
ISE Corporation and its Official Committee of Unsecured Creditors
won dismissal of two bankruptcy appeals taken by Maxwell
Technologies, Inc.
ISE and Maxwell had a business relationship for many years with
respect to the development of a product that would be a component
of ISE's clean energy hybrid bus technology. When it filed for
bankruptcy, ISE claimed that Maxwell had misappropriated the
Debtor's intellectual property. ISE sold substantially all of its
assets to several purchasers with Bluways USA, Inc. acquiring the
majority of ISE's assets at auction.
Maxwell put in a bid at the auction that included a limited
licensing agreement and a mutual general release. ISE accepted
Maxwell's bid which was included in the order authorizing the
sale. Prior to the bankruptcy court's further approval of the
sale order, Bluways filed a complaint against ISE that asserted
that ISE possessed claims against Maxwell for patent infringement
and those claims should have been sold to Bluways under the sale
order.
Bluways, a subsidiary of Bluways NV, is a Belgian system
integrator and supplier of hybrid electric drive systems and
components for heavy-duty applications. The company is a premier
manufacturer of high tech products in the field of drive
technology and power control electronics for a wide variety of
customers in the automobile industry.
Maxwell moved to enforce the amended order which included
approving the sale of assets; authorizing the assumption and
assignment of certain executory contracts; and approving the sale
transaction and the transaction documents filed by Maxwell; and to
enforce the sale order. As the bankruptcy court noted: "Maxwell
appears to seek a ruling that 1) the Settlement [between Maxwell
and ISE] was approved by the Court, and 2) the Debtor must bring
the 9019 motion."
In its ruling denying Maxwell's motion, the bankruptcy court found
and concluded that the parties had not reached a final and
complete settlement and therefore, the court had not approved the
settlement agreement. The court also recognized that by its
motion, Maxwell sought to have the 9019 motion brought before the
bankruptcy court. But the court noted that the factors to be
considered in approving the settlement, if it were to be brought
in a proper 9019 motion, had already been considered and requiring
the Debtor to file the motion would be a useless act. The
bankruptcy court's denial of Maxwell's motion lead to the filing
of the first Maxwell appeal.
Thereafter, Bluways and ISE agreed to resolve Bluway's complaint
concerning its purchase of ISE's assets in a settlement agreement.
The bankruptcy court entered an order approving ISE's and Bluway's
joint motion for order approving compromise of controversy with
Bluways, USA, Inc. The settlement agreement and approval order
included ISE's assignment to Bluways of the disputed patent claims
against Maxwell. Again, Maxwell appealed the decision of the
bankruptcy court.
Although Maxwell's two appeals were timely brought, in neither
instance did Maxwell seek a stay of the bankruptcy court orders
pending their appeal. The Debtor and the Committee contend that
both appeals are moot because Maxwell failed to seek stays pending
the appeals and there has been substantial consummation of the
plan.
District Judge M. James Lorenz agrees that reversal of the orders
would certainly require the bankruptcy court to unravel a complex
bankruptcy plan. Judge Lorenz noted that ISE has paid several
third parties who are not parties to these appeals with funds from
the Bluways Settlement.
The case before the District Court is, MAXWELL TECHNOLOGIES, INC.,
Appellant, v. ISE CORPORATION and OFFICIAL COMMITTEE OF UNSECURED
CREDITORS OF ISE CORPORATION, Appellees, Civil No. 11cv2704-
L(NLS), Consolidated No. 12cv1001-L(NLS), No. 10-14198-MM-11 (S.D.
Calif.). A copy of the District Court's Oct. 9, 2012 Order is
avialable at http://is.gd/P97Nxl from Leagle.com.
About ISE Corporation
ISE Corporation, a California corporation, fka ISE Research
Corporation, is the operating subsidiary of Ise Limited. ISE Corp
-- http://www.isecorp.com/-- makes drive train systems for
hybrid gasoline/electric buses. Established in 1995, ISE is
headquartered in San Diego, California. It filed for Chapter 11
protection (Bankr. S.D. Calif. Case No. 10-14198) on Aug. 10,
2010. Marc J. Winthrop, Esq., at Winthrop Couchot Professional
Corp, assists the Debtor in its restructuring effort. The Debtor
estimated its assets at $10 million to $50 million and its debts
at $10 million to $50 million as of the Petition Date.
JHK INVESTMENTS: Files Schedules of Assets and Liabilities
----------------------------------------------------------
JHK Investments, LLC, filed with the Bankruptcy Court its
schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $38,690,639
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $31,431,450
E. Creditors Holding
Unsecured Priority
Claims $1,002
F. Creditors Holding
Unsecured Non-priority
Claims $694,825
----------- -----------
TOTAL $38,690,639 $32,127,278
A full text copy of the schedules of assets and liabilities is
available free at http://bankrupt.com/misc/JHK_INVESTMENTS_sal.pdf
JHK Investments, LLC, filed a Chapter 11 petition (Bankr. D. Conn.
Case No. 12-51608) in Bridgeport, Conn., on Aug. 29, estimating
under $100 million in assets and more than $10 million in
liabilities. Craig I. Lifland, Esq., at Zeisler & Zeisler, P.C.,
represents the Debtor.
Westport, Connecticut-based JHK is an investment company founded
by the former senior management team of United States Surgical
Corporation. Founded by Leon C. Hirsch in 1963, USSC became a
global medical device manufacturer with sales exceeding
$1.2 billion and employing $4,000 Connecticut residents.
Following the success of USSC, Mr. Hirsch and two other senior
USSC executives created JHK in order to produce and develop new
markets and penetrate established markets throughout the world for
high-tech medical devices. JHK owns equity in several start-up
medical subsidiaries. The start-ups include Interventional
Therapies, LLC, Auditory Licensing Company, LLC, Biowave
Corporation, Gorham Enterprises, LLC, and American Bicycle Group,
LLC.
Bay City claims to be owed $31 million for funding provided to the
Debtor since January 2011. The principals at JHK -- Mr. Hirsch,
Turi Josefsen, and Robert A. Knarr -- guaranteed JHK's
obligations, pledged the property in Wilton, Connecticut to secure
obligations under the guaranty, and pledged all equity interests
of JHK.
In March 2012, Eleuthera, in its capacity as administrative agent
for Bay City, declared an event of default as a result of the
passage of the maturity date and the failure to pay the entire
amount outstanding. On Aug. 28, 2012, Bay City and Eleuthera
purported to exercise the pledge agreements insofar as they
purported to register the Principals' interest in JHK in the name
of Eleuthera, as nominee for Bay City, and purported to reserve
their right to exercise voting rights in JHK.
LUMBER PRODUCTS: Trustee Employs Capacity Commercial as Broker
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon authorized
Edward C. Hostman, the Chapter 11 Trustee for Lumber Products, to
employ Capacity Commercial Group, LLC, as the Trustee's real
estate broker to assist in selling the Debtor's real property
located at 11555 SW Myslony Street in Tualatin, Oregon.
As reported in the TCR on Oct. 5, 2012, the Trustee seeks to
compensate the Broker at a commission rate of 4% of the sale price
of the Property, with such commission to be paid directly out of
the proceeds from the sale of the Property without the need for a
fee application.
To the best of the Trustee's knowledge, Capacity Commercial Group
LLC is a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.
About Lumber Products
Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938. It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico. Lumber
Products is the sole owner of Lumber Products Holding and
Management Company. Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.
Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts. Judge Elizabeth L. Perris presides over the
case. The petition was signed by Craig Hall, president and chief
operating officer.
The Debtor owes Wells Fargo in excess of $22.8 million. Wells
Fargo is represented by Lane Powell PC.
Edward C. Hostmann, the Chapter 11 trustee, is represented by
Tonkon Torp LLP.
LUMBER PRODUCTS: Trustee Hiring CLA as Auditor to Audit ESOP
------------------------------------------------------------
Edward C. Hostmann, the Chapter 11 Trustee for Lumber Products,
asks the U.S. Bankruptcy Court for the District of Oregon for
authorization to employ CliftonAllenLarson, LLC, to audit the
Lumber Products Restated Employee Stock Option Plans and Trust.
The ESOP consists of two plans operating under a single document -
- a money purchase pension plan and a stock bonus plan.
The compensation and expenses of CLA will be a flat fixed fee of
$9,000 for the audit of the ESOP money purchase pension plan and a
flat fixed fee $9,000 for the audit of the ESOP stock bonus plan,
for a total compensation of $18,000.
About Lumber Products
Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938. It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico. Lumber
Products is the sole owner of Lumber Products Holding and
Management Company. Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.
Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts. Judge Elizabeth L. Perris presides over the
case. The petition was signed by Craig Hall, president and chief
operating officer.
The Debtor owes Wells Fargo in excess of $22.8 million. Wells
Fargo is represented by Lane Powell PC.
Edward C. Hostmann, the Chapter 11 trustee, is represented by
Tonkon Torp LLP, in Portland, Oregon.
Justin D. Leonard, Esq., and Peter C. McKittrick, Esq., at
McKittrick Leonard LLP, in Portland, Oregon; and Tara J.
Schleicher, Esq., at Farleigh Wada Witt, in Portland, Oredgon,
represent the Official Committee of Unsecured Creditors as
counsel.
MACROSOLVE INC: 3 Directors Quit; Names Executives for Next Year
----------------------------------------------------------------
David Humphrey, Dale Schoenefeld and Steve Signoff each resigned
for personal reasons, effective Oct. 3, 2012, as a director of
MacroSolve, Inc. In submitting their resignations, Messrs.
Humphrey, Schoenefeld and Signoff did not express any disagreement
with the Company on any matter relating to the Company's
operations, policies or practices.
On Oct. 3, 2012, the Board of Directors of the Company appointed
the executive officers of the Company for the next year, as
follows:
Name Title
James C. McGill Chairman of the Board of Directors,
President and Chief Executive Officer
Kendall Carpenter Executive Vice President, Chief
Financial Officer and Secretary
Previously, Mr. McGill served as the Executive Chairman of the
Board and Ms. Carpenter served as Vice President Finance and
Administration, Chief Financial Officer, Secretary and Treasurer.
About MacroSolve, Inc.
Tulsa, Okla.-based MacroSolve, Inc. (OTC BB: MCVE)
-- http://www.macrosolve.com/-- is a technology and services
company that develops mobile solutions for businesses and
government. A mobile solution is typically the combination of
mobile handheld devices, wireless connectivity, and software that
streamlines business operations resulting in improved efficiencies
and cost savings.
The Company reported a net loss of $2.53 million in 2011, compared
with a net loss of $1.92 million during the prior year.
The Company's balance sheet at June 30, 2012, showed $2.20 million
in total assets, $1.37 million in total liabilities and $833,924
in total stockholders' equity.
In its report on the Company's 2011 financial results, Hood Sutton
Robinson & Freeman CPAs, P.C., in Tulsa, Oklahoma, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has suffered recurring losses from operations and has a net
capital deficiency.
MARINA BIOTECH: Had $29.4MM Loss in 2011, May File for Bankruptcy
-----------------------------------------------------------------
Marina Biotech, Inc., filed on Oct. 10, 2012, its annual report
for the fiscal year ended Dec. 31, 2011.
KPMG LLP, in Seattle, expressed substantial doubt about Marina
Biotech's ability to continue as a going concern. The independent
auditors noted that the Company has ceased substantially all day-
to-day operations, including most research and development
activities, has incurred recurring losses, has a working capital
and accumulated deficit and has had recurring negative cash flows
from operations.
The Company reported a net loss of $29.42 million on $2.24 million
of license and other revenue for 2011, compared with a net loss of
$27.75 million on $2.46 million of license and other revenue for
2010.
The Company's balance sheet at Dec. 31, 2011, showed
$11.75 million in total assets, $11.71 million in total
liabilities, and stockholders equity of $38,000.
May File for Bankruptcy
"We have experienced and continue to experience operating losses
and negative cash flows from operations, as well as an ongoing
requirement for substantial additional capital investment. We
expect that we will need to raise substantial additional capital
to continue our operations beyond Oct. 31, 2012. We are currently
pursuing a variety of funding options, including equity offerings,
partnering/co-investment, venture debt and commercial licensing
agreements for our technologies. There can be no assurance as to
the availability or terms upon which such financing and capital
might be available. If we are not successful in our efforts to
raise additional funds by Oct. 31, 2012, we may be required to
further delay, reduce the scope of, or eliminate one or more of
our development programs or discontinue operations altogether."
"As a result, there is a significant possibility that we will file
for bankruptcy or seek similar protection. Moreover, it is
possible that our creditors may seek to initiate involuntary
bankruptcy proceedings against us, which would force us to make
defensive voluntary filing(s) of our own. If we restructure our
debt or file for bankruptcy protection, it is very likely that our
common stock will be severely diluted if not eliminated entirely."
A copy of the Form 10-K is available at http://is.gd/1IjoNy
Marina Biotech, Inc., headquartered in Bothell, Washington, is a
biotechnology company focused on the discovery, development and
commercialization of nucleic acid-based therapies utilizing gene
silencing approaches such as RNA interference ("RNAi") and
blocking messenger RNA ("mRNA") translation. The Company's goal
is to improve human health through the development, either through
its own efforts or those of its collaboration partners and
licensees, of these nucleic acid-based therapeutics as well as the
delivery technologies that together provide superior treatment
options for patients. The Company has multiple proprietary
technologies integrated into a broad nucleic acid-based drug
discovery platform, with the capability to deliver novel nucleic
acid-based therapeutics via systemic, local and oral
administration to target a wide range of human diseases, based on
the unique characteristics of the cells and organs involved in
each disease.
On June 1, 2012, the Company announced that, due to its financial
condition, it had implemented a furlough of approximately 90% of
its employees and ceased substantially all day-to-day operations.
Since that time substantially all of the furloughed employees have
been terminated. As of Sept. 30, 2012, the Company had
approximately 11 remaining employees, including all of its
executive officers, all of whom are either furloughed or working
on reduced salary. As a result, since June 1, 2012, its internal
research and development efforts have been minimal, pending
receipt of adequate funding.
MARKET STREET: Confirmation Hearing Continued to Oct. 16
--------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
has continued until Oct. 16, 2012, at 2:00 p.m., the hearing to
consider the confirmation of Market Street Properties, L.L.C.'s
Amended Chapter 11 Plan.
According to the Debtor's Amended First Immaterial Modifications
to the Fourth Amended Plan of Reorganization dated June 1, 2012,
the Plan is amended and restated, among other things, to reflect
that in full settlement, satisfaction, and discharge of General
Unsecured Claims, the claimants will receive the pro rate share of
$100,000 to be paid on within 30 days of the later of (i)
the effective date or (ii) the date on which the Reorganized
Debtor receives the initial advance of the exit financing which is
sufficient to pay all allowed priority claims and allowed
administrative claims as of the Effective Date.
A copy of the Plan is available for free at
http://bankrupt.com/misc/MARKET_STREET_4amendedplan.pdf
About Market Street Properties
Market Street Properties, L.L.C., the owner of seven acres on
the riverfront in New Orleans, filed for Chapter 11 bankruptcy
(Bankr. E.D. La. Case No. 09-14172) on Dec. 23, 2009, represented
by Christopher T. Caplinger, Esq., Joseph Patrick Briggett, Esq.,
and Stewart F. Peck, Esq., at Lugenbuhl Wheaton Peck Rankin &
Hubbard, in New Orleans. Cupkovic Architecture LLC serves as the
Debtor's architect; and Patrick J. Gros, CPA, as accountant.
James E. Fitzmorris, Jr., serves as political consultant and
advisor. The Company disclosed $52,404,026 in assets and
$26,848,596 in liabilities as of the Chapter 11 filing.
An official committee of unsecured creditors has not been
appointed in the Debtor's case.
MEHR IN LOS ANGELES: Case Summary & 13 Unsecured Creditors
----------------------------------------------------------
Debtor: Mehr in Los Angeles Enterprises, LLC
11601 Wilshire Blvd., Suite 2160
Los Angeles, CA 90025
Tel: (310) 432-2310
Bankruptcy Case No.: 12-43589
Chapter 11 Petition Date: October 4, 2012
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Peter Carroll
Debtor's Counsel: Michael S. Kogan, Esq.
KOGAN LAW FIRM APC
1901 Avenue of the Stars, Suite 1050
Los Angeles, CA 90067
Tel: (310) 432-2310
E-mail: mkogan@koganlawfirm.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Yadollah Shakib, managing member.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Raha Lakes Enterprises, LLC 12-43422 10/03/12
Debtor's List of Its 13 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Los Angeles County Tax Collector Property Tax $114,967
225 North Hill Street
Los Angeles, CA 90012
Caspian Insurance Services Trade $4,113
4521 Sherman Oaks Avenue, #2G
Sherman Oaks, CA 91403
LA Municipal Services (DWP) Trade $3,915
P.O. Box 30808
Los Angeles, CA 90030-0808
Vicente Escalante Trade $2,760
Marc Bral Trade $2,532
Abtin Missaghi Trade $1,800
Tim Afrasiabi Trade $1,478
American Waste Trade $500
Reed Smith LLP Trade $330
Ali Rostampour Trade --
Shipping Supply Plus, Inc. Trade --
Yervand Darabedian Trade --
Kamran Shakib Trade
METRO FUEL: Contemplates Sale of Various Assets
-----------------------------------------------
Ron Kotrba at Biodiesel Magazine reports that, after recently
filing Chapter 11 bankruptcy, Metro Fuel Oil Corp. is exploring
certain strategic alternatives, including a sale of its various
assets.
The report says these assets include Metro Biofuels LLC's large,
multi-feedstock biodiesel plant under development in Brooklyn,
N.Y.
According to the report, Scott Chabina, vice president of Carl
Marks Advisory Group, a firm with renewable energy expertise, has
been retained as financial advisor and investment banker to assist
Metro and its related subsidiaries according to bankruptcy
filings. The 110 MMgy multi-feedstock biodiesel production
facility is roughly 90% complete and preliminary deadlines and
bidding procedures for the sales process were filed on Oct. 8 in
the U.S. Bankruptcy Court, Eastern District of New York.
According to the report, parties interested in the biodiesel
facility, or any other assets of the company, have been requested
to provide preliminary bid documents by Oct. 31. Preliminary
bidders are asked to sign a confidentiality agreement, which will
provide them access to a wide range of additional due diligence
materials pertaining to the sales process. Such preliminary
bidders will also be required to demonstrate proof of financial
wherewithal necessary to close any proposed transaction.
The report adds those interested in receiving additional
information pertaining to any of the company's assets should
directly contact Scott Chabina with Carl Marks Advisory Group.
Based in Brooklyn, New York, Metro Fuel Oil Corp., fka Newtown
Realty Associates, Inc., and several of its affiliates filed for
Chapter 11 bankruptcy protection (Bankr. E.D. N.Y. Lead Case No.
12-46913). Judge Elizabeth S. Stong presides over the case.
Nicole Greenblatt, Esq., at Kirkland & Ellis LLP, represents the
Debtor. The Debtor selected Epiq Bankruptcy Solutions LLC as
notice and claims agent. The Debtor estimated assets of between
$10 million and $50 million, and debts of between $50 million and
$100 million.
MGM RESORTS: Fitch Affirms 'B-' IDR; Outlook Positive
-----------------------------------------------------
Fitch Ratings has affirmed MGM Resorts International's (MGM)
Issuer Default Rating (IDR) at 'B-' and MGM Grand Paradise, S.A.'s
(MGM Grand Paradise) IDR at 'B+'. Fitch also affirms all of MGM's
and MGM Grand Paradise's transaction ratings. The Rating Outlook
is revised to Positive from Stable.
The Outlook revision to Positive reflects:
-- Fitch's continued positive outlook on Las Vegas Strip
fundamentals over the next couple of years, despite some
recent demand weakness which has tempered the outlook
somewhat;
-- The ability of MGM China (51% owned by MGM, parent company of
MGM Grand Paradise) to pay meaningful dividends supported by
robust discretionary free cash flow (FCF), an anticipated
increase in the Macau credit facility, and significant cash
on hand;
-- Favorable execution of capital market transactions in 2012,
which improved the company's maturity profile without an
adverse impact on interest expense;
-- The opportunity to reduce interest costs through refinancing
high-interest secured notes in 2013 and 2014.
The above considerations should improve MGM's credit profile in
terms of liquidity, FCF and leverage to be more consistent with a
'B' IDR over the next several quarters. Given MGM's size, market
exposure and expressed interest in improving its balance sheet,
MGM's credit profile improvement could result in continued
migration up the rating spectrum over the next few years. The
pace and extent of the migration largely depends on management's
willingness to support its credit profile while pursuing potential
growth opportunities.
Credit concerns that constrain upward movement in the ratings in
the near term include MGM's high leverage, weak albeit improving
FCF, a maturity wall that remains formidable past 2014 and a thin
cushion relative to its primary credit facility covenant. These
negative considerations leave MGM's credit profile vulnerable to
weak downside scenarios, as it remains highly sensitive to a
downturn in the broader economy, the Las Vegas Strip, and/or
capital market conditions.
An upgrade of MGM's IDR to 'B' could occur over the next several
quarters if:
-- The Las Vegas Strip recovery continues in-line with Fitch's
base case;
-- The company successfully executes refinancing transactions
with respect to upcoming maturities of its high-coupon
secured notes, resulting in significant interest cost
reductions and maturity profile improvement;
-- Any potential growth opportunity does not materially affect
MGM's credit profile adversely.
Fitch anticipates improvement in the domestic group's FCF profile,
continued Macau dividends, and/or the use of cash on hand to pay-
down near-term maturities to aid MGM's de-leveraging. Fitch
forecasts MGM's domestic leverage and consolidated leverage
(adjusted for minority interest) to improve to around 10x and 7.5x
by year-end 2013, respectively, and 8x and 7x by year-end 2014.
This compares to domestic and consolidated leverage as of June 30,
2012 of roughly 10.8x and 8.1x, respectively. At the 'B-' IDR,
MGM's FCF and ability to address upcoming maturities remain
primary rating drivers, but leverage will become an increasingly
important consideration in the ratings as the overall credit
quality improves.
The reported covenant EBITDA for the LTM period ending June 30,
2012 is $1.3 billion relative to a covenant threshold of $1.20
billion for the period. The covenant steps up to $1.25 billion in
March 2013 and $1.30 billion in June 2013. The Macau dividend
received by the domestic group is counted in the covenant EBITDA,
providing MGM a degree of flexibility with respect to the
covenant.
Upcoming Maturities and Liquidity
MGM executed several transactions this year that improved the
company's maturity profile without adversely affecting its
interest burden, unlike other lower rated gaming issuers such as
Caesars Entertainment Corp. (rated with an IDR of 'CCC'; Negative
Outlook by Fitch) and Boyd Gaming (IDR of 'B'; Negative Outlook).
Pro forma for repayment of the 6.75% notes that matured in
September 2012 and the September $1 billion note issuance, MGM's
domestic restricted group has $2.0 billion in liquidity ($1.8
billion excluding non-extended revolver availability).
MGM has $1.4 billion of maturities in 2013, including $750 million
in 13% New York-New York secured notes (notes also have pro rata
security in Bellagio, MGM Grand and Mirage). There is $1.3
billion of debt maturing in 2014, half of which are the 10.375%
Bellagio/Mirage secured notes.
In May 2013, MGM will be able to call its 10.125% secured notes
due 2017 at a premium of 105.563, which could save the company
approximately $15 million-$30 million assuming a 7%-9% coupon.
Refinancing maturities that are beyond 2015 are limited to $500
million as per credit agreement covenants but Fitch believes there
is good chance that MGM will amend its credit facility sometime in
2013 or 2014 in conjunction with the maturity/refinance of the
2013-2017 secured notes. The collateral released by the paydown
of the secured notes could be pledged to the credit facility in an
effort to improve pricing.
Free Cash Flow
The domestic group's FCF for the LTM period ending June 30, 2012
was roughly negative $185 million, which includes $387 million of
capex, the bulk of which is related to room remodels at Bellagio
($70 million) and MGM Grand ($160 million). Excluding these room
remodels and including Macau dividends (which Fitch believes will
be recurring), domestic LTM discretionary FCF is closer to
positive $200 million (or breakeven without the dividends).
Fitch believes that MGM Grand Paradise has the ability to continue
to pay meaningful dividends despite the planned Cotai development
($2.5 billion budget). Dividends will be supported by MGM Macau's
robust discretionary FCF ($674 million for LTM period ending June
30, 2012), existing cash on hand (excess cash is around $500
million), and anticipated proceeds from a new upsized credit
facility.
Domestic capex is expected to moderate somewhat but remain
elevated as MGM announced a $40 million remodel at Bellagio's
newer Spa Tower and a remodel of the rooms at THEhotel tower at
Mandalay Bay. (The budget for THEhotel is undisclosed but Fitch
estimates MGM spending at about $35 million-$40 million). Full-
year 2012 domestic capex will be about $320 million and Fitch
estimates 2013 domestic capex in the $250 million-$300 million
range.
MGM's domestic FCF will also improve as a result of continued
EBITDA recovery, which began about two years ago for MGM. About
78% of wholly-owned property EBITDA is generated on the Las Vegas
Strip. Fitch expects domestic FCF to be breakeven to slightly
positive in 2013 and improve to exceed $200 million starting 2014.
Improvement in the outer years includes interest expense
reductions largely stemming from maturities/refinancings of high-
coupon secured notes in 2013 and 2014.
Las Vegas Outlook
Fitch believes the fundamental outlook for the Las Vegas Strip
remains among the safest markets in the U.S. for the balance of
2012 and 2013, supported by minimal supply growth for the
foreseeable future. With its recently completed/planned room
remodels at Bellagio, MGM Grand and Mandalay Bay, MGM should
benefit from the attractive supply/demand outlook on the Strip
over the next couple of years.
The Las Vegas Strip recovery trajectory slowed materially in
second quarter 2012, and forward trends softened as the shorter-
term group/business segment (i.e. in the year, for the year)
weakened. Visitation is up 1.8% year-to-date through August,
while gaming revenues are up 2.6% on the Las VagasStrip. Fitch
currently anticipates visitation and revenue growth in 2013 to be
similar to 2012.
Potential Project Pipeline
Aside from MGM's Cotai project mentioned earlier, MGM is pursuing
developments at National Harbor (right outside Washington DC) and
in Springfield, MA, with each development budgeted at $800
million. In Toronto, MGM is proposing a multi-billion casino
resort.
All of these projects have significant regulatory/licensing
hurdles to overcome:
-- In Massachusetts, the bidding process for the state's
western-region gaming license is very contentious with at
least four other bidders in the mix including Penn National
Gaming, Ameristar Casinos, Mohegan Tribal Gaming Authority
and Seminole Hard Rock Entertainment.
-- Maryland (National Harbor) hinges on the recently passed
legislation that would allow a casino in Prince George's
County passing a referendum in November. Penn National
Gaming, whose Charles Town, WV, racino would be negatively
affected if the referendum passes, is allocating considerable
resources to combat the measure.
-- Ontario Lottery and Gaming Corp's plans to revamp the
province's gaming regulations, which may allow a casino in
the Toronto area. The city of Toronto is still contemplating
whether it wants a major casino, and other parties expressed
interest including Las Vegas Sands and Caesars.
Given MGM's somewhat constrained financial profile and
restrictions imposed by the domestic credit agreement, Fitch
believes that the projects outside of Macau will be done through
project finance arrangements, possibly with other financial
partners. However, there is a meaningful chance that MGM will
refinance/amend its credit facility in the near term and include
these projects in its main restricted group.
MGM Grand Paradise
Fitch views MGM Grand Paradise's stand-alone credit profile to be
more consistent with a 'BB' category IDR but the 'B+' IDR reflects
MGM's weaker credit profile, MGM's 51% ownership in MGM China (MGM
Grand Paradise's holding company), and MGM's control with respect
to MGM China's dividend policy.
There are no cross-default provisions between MGM and MGM Grand
Paradise, but MGM has control with respect to MGM China's dividend
policy. MGM Grand Paradise's current credit agreement permits the
Macau subsidiary to pay unlimited dividends as long as gross
leverage is less than 3.5x (current leverage is less than 1x) and
permits more limited dividends if leverage is at or less than
4.0x. The 'B+' IDR reflects the risk that MGM Grand Paradise may
opt to leverage up to 3.5x or higher to support the weaker parent
company. These covenants may be revised, as the company is
currently pursuing a new credit facility for MGM Grand Paradise.
The Positive Outlook on MGM Grand Paradise reflects MGM's
improving credit profile, which reduces the risk that MGM Grand
Paradise will be relied on to support the domestic credit group.
If Fitch upgrades MGM's IDR to 'B', it will also upgrade MGM Grand
Paradise to 'BB-', which is more in-line with MGM Grand Paradise's
stand-alone credit profile. Fitch expected MGM Grand Paradise to
seek a larger facility to accommodate its Cotai project and
believes leverage will remain at or below 3x through the
development cycle with ample capacity to upstream cash flow to MGM
and minority shareholders.
MGM Grand Paradise's MGM Grand Macau property has fared relatively
well over the last several months amid the slow-down in the
market's VIP business, which is related to the broader China
economic slowdown. MGM's Macau subsidiary reported a modest year-
over-year EBITDA increase in second-quarter 2012 and, through
September, MGM Grand Macau's market share remained steadily around
10% despite additional capacity coming on-line in April 2012 (i.e.
Sands China's Cotai Central).
Recovery Ratings
Fitch estimates full recovery in an event of default for MGM's
secured notes resulting in a rating of 'BB-/RR1' and a three-notch
positive differential relative to the 'B-' IDR.
MGM's credit facility is partially secured by Beau Rivage, Gold
Strike Tunica, and the land on the Las Vegas Strip across from the
Luxor. MGM Grand Detroit is a co-borrower on the credit facility
and secured it to the extent it draws on the facility ($450
million as of June 30, 2012). Fitch estimates a recovery in 51%-
70% range for the facility, which results in a 'B/RR3' and a one-
notch positive differential relative to the 'B-' IDR.
Fitch estimates average recovery prospects in the 31%-50% range
for the unsecured notes resulting in no notching from the 'B-'
IDR.
Fitch expects that MGM's subordinate notes due 2013 will mature
before any reasonable default scenario can occur, but assigns a
'CCC/RR6' (two-notch negative differential) to the notes to
account for the notes' subordination.
There is a high probability that Fitch will upgrade the credit
facility (and possibly the unsecured notes) as MGM's secured notes
mature or are called, which would result in improved recovery
prospects for the balance of the capital structure. Approximately
$3.1 billion in notes secured by New York-New York, Bellagio,
Mirage and MGM Grand become due or are callable by 2014.
Fitch estimates full recovery on MGM Grand Paradise's senior
secured credit facility. The 'RR2' on the Macau credit facility
reflects a two-notch soft cap for Macau issuers as stipulated by
Fitch's criteria ('Country-Specific Treatment of Recovery
Ratings', dated June 15, 2012).
Ratings being affirmed by Fitch are as follows:
MGM Resorts International
-- IDR at 'B-';
-- Senior secured notes due 2013, 2014, 2017, and 2020 at
'BB-/RR1';
-- Senior credit facility at 'B/RR3';
-- Senior unsecured notes at 'B-/RR4';
-- Convertible senior notes due 2015 at 'B-/RR4';
-- Senior subordinated notes at 'CCC/RR6'.
MGM Grand Paradise S. A.
-- IDR at 'B+';
-- Senior secured credit facility at 'BB/RR2'.
MMRGLOBAL INC: Expands Health IT Patent Portfolio
-------------------------------------------------
MMRGlobal, Inc., had received a Notice of Allowance, U.S. Serial
No. 13/352,026, from the United States Patent and Trademark Office
which expands the Company's "Method and System for Providing
Online Medical Records." In short, the most recent allowed
application expands MMR's patent portfolio to cover the exchange
of protected health information to and from patients, doctors,
pharmacies, insurance providers and other healthcare professionals
in various forms, including, but not limited to, email, text,
phone, facsimile and web-based portals. The MMR patent portfolio
is believed to be relevant to virtually any provider who transmits
electronic health records in that it will limit their ability to
communicate protected health information without potentially
infringing on MMR's patents. Starting in 2014, Meaningful Use
requirements mandate that patients receive timely online access to
their health information. The Company believes that the methods
and systems claimed in its patent portfolio provide solutions
which will assist healthcare providers in meeting those
requirements.
The Company has also initiated licensing and enforcement efforts
through its patent litigation counsel, Liner Grode Stein
Yankelevitz Sunshine Regenstreif & Taylor LLP. Liner has already
begun contacting physicians, hospitals, pharmacies and others who
use or market methods and systems of providing personal health
information including Personal Health Records to patients or
healthcare professionals.
According to Robert H. Lorsch, President and Chief Executive
Officer of MMRGlobal, "We have invested heavily in the development
of our patent portfolio and are now positioned to reap the
benefits of such investment by compelling doctors, pharmacies,
insurance providers, electronic medical record providers and other
healthcare professionals to choose negotiating a license with us
for the use of our intellectual property or face potential
infringement actions. With Meaningful Use requirements for
patient engagement taking effect in 2014, which stipulate that
patients have online access to their medical records within a
certain period of time following the receipt of healthcare
services, we believe the MMR portfolio is extremely relevant."
"This Notice of Allowance continues to expand MMR's patent
portfolio, which provides the Company with significant
foundational intellectual property rights covering a large sector
of health IT, particularly as it pertains to Personal Health
Records," said Ted Ward, lead patent litigation counsel at Liner.
"The Company has instructed us to begin enforcement of its
intellectual property, and as a result, we have already begun
contacting physicians, hospitals, pharmacies, and others who use
or market methods and systems of providing Personal Health Records
to patients or healthcare professionals. We are also pleased that
this most recent application 13/352,026, which was filed on
January 17, 2012, was issued in less than nine months. This
Notice of Allowance, along with the Notice of Allowance of U.S.
Serial No. 13/041,809 received approximately three weeks ago,
continues to expand MMR's previously issued patents."
The MMR portfolio is the result of a six-year collaborative effort
with the law firm of McKee, Voorhees & Sease, PLC, and the parties
intend to continue to expand the reach of MMR's patent portfolio
concurrently with the licensing and enforcement efforts of Liner.
Any additional patents received by the Company will become part of
its current patent portfolio, which already consists of U.S.
patent numbers 8,117, 646; 8,117,045; and 8,121,855, announced
earlier this year. According to John Goodhue of MVS, "We intend
to continue doing our part in building out the MMR patent
portfolio as quickly as possible so that MMR can continue to
maximize the value of its IP in advance of the mandatory 2014
Meaningful Use requirements."
The Company's patent portfolio also includes numerous other issued
patents and pending applications in the U.S. and countries of
commercial interest including Australia, Singapore, New Zealand,
Mexico, Canada, Hong Kong, Japan, South Korea, Israel, and
European nations.
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 June 30, 2012, showed $2.03 million
in total assets, $8.46 million in total liabilities, and a
$6.43 million total stockholders' deficit.
MOHEGAN TRIBAL: Files Statistical Report for Mohegan Sun
--------------------------------------------------------
The Mohegan Tribal Gaming Authority posted on its Web site its
Slot Machine Statistical Report for Mohegan Sun at Pocono Downs
containing statistics relating to slot handle, gross slot win,
gross slot hold percentage, Pennsylvania slot tax and weighted
average number of slot machines. The Slot Machine Statistical
Report includes these statistics on a monthly basis for the fiscal
years ended Sept. 30, 2012, and 2011. A copy of the Report is
available for free at http://is.gd/8fcyZf
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 June 30, 2012, showed $2.22 billion
in total assets, $2.01 billion in total liabilities and $207.83
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.
In the March 2, 2012, edition of the TCR, Moody's Investors
Service revised Mohegan Tribal Gaming Authority's Probability of
Default Rating to Caa1\LD from Caa3 following the completion of a
debt exchange transaction which Moody's views as a distressed
exchange. Concurrently, Moody's raised MTGA's Corporate Family
Rating ("CFR") to Caa1 from Caa3 and revised its rating outlook to
stable from negative to reflect its improved credit profile as a
result of the exchange and recent debt covenant amendments.
MOMENTIVE PERFORMANCE: S&P Gives 'CCC+' Rating on $1.1BB Sr. Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' senior
secured debt rating (one notch above the corporate credit rating)
and '2' recovery rating to the proposed offering of $1.1 billion
of first-priority senior secured notes due 2020 by MPM Escrow LLC
and MPM Finance Escrow Corp. "The '2' recovery rating indicates
our expectation of substantial (70% to 90%) recovery in the event
of a payment default. If and when the escrow conditions are
satisfied (which must occur by Jan. 15, 2013), these notes will
become obligations of MPM. The company plans to use the proceeds
from the notes to repay revolver borrowings and other debt due in
2014 and 2015 and for general corporate purposes," S&P said.
"At the same time, we affirmed our 'CCC' corporate credit rating
on MPM. In addition, based on our updated recovery analysis, we
placed our 'CCC' rating on the company's $250 million 1.5 lien
notes due 2020 on CreditWatch with negative implications. If the
transaction closes as currently structured, we will lower the
ratings on these notes to 'CC' (two notches below the corporate
credit rating) with a recovery rating of '6', indicating our
expectation of negligible (0%-10%) recovery in the event of a
payment default," S&P said.
"We affirmed all our other ratings on MPM and its subsidiaries. If
the transaction closes as currently structured, the company
expects its existing second priority springing lien notes will
become secured, but the 'CC' issue rating and '6' recovery rating
on these notes would not change. The outlook remains negative,"
S&P said.
"In our view, leverage is unsustainably high, with total adjusted
debt of about $4.1 billion and debt-to-EBITDA above 15x pro forma
for the refinancing," said credit analyst Cynthia Werneth. "The
ratings on MPM reflect the company's highly leveraged financial
profile and what we deem to be a fair business risk profile."
"The negative outlook reflects our expectation that silicone
overcapacity and a tepid global economy will cause MPM's free
operating cash flow to be negative for at least the next several
quarters, causing liquidity to contract. We are likely to lower
the ratings during the next several quarters if industry
conditions fail to improve sufficiently to enable MPM to achieve
cash flow neutrality and stabilize liquidity, heightening the
probability of a payment default. We could also lower the ratings
sooner if the proposed $300 million ABL and notes financing is not
completed as currently structured, or if the company voluntarily
restructures or repurchases its debt in such a way that results in
anything less than full and timely repayment," S&P said.
"On the other hand, we could revise the outlook to stable if
earnings and cash flow strengthen, leverage declines, and
liquidity stabilizes at a level we consider adequate," S&P said.
MOTORSPORT RANCH: U.S. Trustee Unable to Form Creditors' Committee
------------------------------------------------------------------
The U.S. Trustee has filed a notice with the Bankruptcy Court of
its inability to appoint a committee of unsecured creditors in the
Chapter 11 case of MotorSport Ranch Houston, LLC.
The U.S. Trustee has attempted to solicit creditors interested in
serving on a creditors' committee from the list of creditors
holding the 20 largest unsecured claims. The U.S. Trustee has
been unable to solicit sufficient interest to form a creditors'
committee.
Angleton, Texas-based MotorSport Ranch Houston, LLC, dba
MotorSport Properties, Ltd., and MSR Houston filed a Chapter 11
petition (Bankr. S.D. Tex. Case No. 12-36422) on Aug. 30, 2012, in
Houston. Judge David R. Jones oversees the case. The Debtor
scheduled $13,660,374 in assets and $6,502,902 in liabilities.
The petition was signed by James A. Redmond, president.
MOUNTAIN EDGE: Subdivision Declared as "Single Asset Real Estate"
-----------------------------------------------------------------
Bankruptcy Judge David T. Thuma ruled that Mountain Edge LLC's
case is a single asset real estate case, and the Debtor's plan of
reorganization does not qualify under 11 U.S.C. Sec. 362(d)(3)(A).
Judge Thuma said the Debtor must commence interest-only payments
to all creditors holding liens on the Debtor's subdivision
property, or else file a plan that has a reasonable possibility of
being confirmed within a reasonable time, by Nov. 9, to avoid stay
relief under 11 U.S.C. 362(d)(3).
Mountain Edge LLC, a New Mexico limited liability company, filed
for Chapter 11 bankruptcy (Bankr. D. N.M. Case No. 12-10835) on
March 3, 2012. The Debtor's sole owners are Jim Haynes, the
Debtor's general manager, and his wife Billie Haynes. The Debtor
has no employees.
The Debtor owns 24 residential lots in the Mountain Ridge
subdivision in Otero County, New Mexico; 6 acre-feet of water
rights and nine wells; and 12 acre-feet of water rights
appurtenant to the Subdivision. The Debtor has used the water
rights to provide water to Subdivision lot owners who did not want
to drill their own water well, and to maintain two trout ponds as
amenities.
On May 31, 2012, the Debtor filed a Motion to Sell Water Rights to
Chippaway Park Water Association for $60,000. No objections to
the Sale Motion were filed. To date no order granting the Sale
Motion has been tendered to the Court for entry.
The Sale Motion states that the amount of water rights to be sold
was two acre feet. However, in the Haynes Affidavit, Mr. Haynes
testified that 6 acre-feet were to be sold for the $60,000 price.
Mr. Haynes avers that in the last two years the only income
generated by the Debtor has been the sale of the six acre feet of
water rights. It is not clear whether the water rights he is
referring to are the ones that are the subject of the Sale Motion
or to water rights sold pre-petition.
Mr. Haynes avers that the Debtor's only activities in the last two
years have been to maintain a sales office, sell the six acre feet
of water rights, and wait for the land sales business to recover.
Mr. Haynes believes the Subdivision (apart from the water rights
and the water wells) is worth about $2,300,000, or an average of
$95,833 per lot.
According to the Court, it appears from the Haynes Affidavit and
the bankruptcy schedules that the water rights may be worth about
$10,000 per acre foot, for a total of between $60,000-$120,000,
depending on whether there are six or 12 acre feet of water rights
owned by the Debtor.
The Debtor's Statement of Financial Affairs does not show any
prepetition sales of water rights in the last two years. The
Debtor's operating reports do not reflect any post-petition sales
of water rights.
On Aug. 17, 2012, the Debtor filed a plan of reorganization. No
disclosure statement has yet been filed.
Clare Miller holds a claim secured by four lots in the
Subdivision. She asked the Court to designate the proceeding as a
Single Asset Real Estate Case.
According to Judge Thuma, it is clear to the Court that the
Subdivision is SARE within the meaning of Sections 101(51B) and
362(d)(3). Apart from the potential sale of water rights, the
Subdivision is the type of development property typically
considered SARE.
Judge Thuma also said the Debtor's proposal to sell water rights
is not a sufficient "substantial business activity" separate from
operation of the Subdivision to take the Subdivision out of the
SARE category. Rather, the proposed sale of water rights is
incidental and relatively minor.
A copy of the Court's Oct. 10, 2012 Memorandum Opinion is
available at http://is.gd/p6TpvWfrom Leagle.com.
NATIONAL HOLDINGS: Two Directors Appointed to Board
---------------------------------------------------
The Board of Directors of National Holdings Corporation appointed
Peter Zurkow and Salvatore Giardina to the Board pursuant to that
certain Securities Purchase Agreement, dated March 30, 2012,
between the Company and National Securities Growth Partners LLC.
The Company is also filling a vacancy created by the resignation
of a director, previously reported. Mr. Zurkow will serve as a
Class I director until his term expires at the 2014 annual meeting
of stockholders, at which time he will stand for reelection by the
Company's stockholders. Mr. Giardina will serve as a Class III
director until his term expires at the 2013 annual meeting of
stockholders, at which time he will stand for reelection by the
Company's stockholders. The Company has not yet appointed Mr.
Giardina or Mr. Zurkow to any Board committees.
Mr. Zurkow, 59, has served as Managing Director and Head of
Corporate Finance at Britton Hill Capital since 2011. He is Co-
Founder of Gourmetrics, Inc. From 2010 through 2012, Mr. Zurkow
served as Acting EVP and Director of Finance and Business
Development at Advanced Brain Technologies. From 2007 through
2009, Mr. Zurkow served as Portfolio Manager and Chief Compliance
Officer for 12 Meter Management, L.P. / Select 12 Meter Funds.
From 2004 through 2007, Mr. Zurkow was a Co-Founder and Managing
Member of Fox Hall Investments, LLC. From 2002-2004, Mr. Zurkow
was a Managing Director of Investec, Inc. From April 2001 to
December 2001, he was a private investor. Prior to joining
Investec, from 1992 to April 2001 Mr. Zurkow was a Managing
Director in UBS Warburg's technology investment banking division.
He joined UBS in conjunction with its acquisition of Paine Webber
Group, where Mr. Zurkow had been a Managing Director in the firm's
investment banking, principal transactions, and fixed income
divisions from 1992 to 2000. He was also a Managing Partner of
PaineWebber's alternative asset management arm and a Member of the
Investment Committee for the firm's Employee Pension Fund. Prior
to joining PaineWebber, Mr. Zurkow was an Associate Managing
Director and a Portfolio Manager in the Risk Arbitrage Department
of Wertheim, Schroder, and a practicing attorney in the New York
office of Skadden, Arps, Slate, Meagher & Flom. Mr. Zurkow
received his A.B from Harvard in 1975 and his J.D. from Syracuse
College of Law in 1978. Mr. Zurkow is Series 7, Series 63 and
Series 79 registered
Mr. Giardina, 50, has served as Chief Financial Officer of Pragma
Securities LLC and its holding company, Pragma Weeden Holdings
LLC, since 2009. From 2006 through 2008, Mr. Giardina served as
S.V.P. and Chief Financial Officer of G-Trade Services LLC and
ConvergEx Global Markets LLC. From 2002 through 2006, Mr.
Giardina served as V.P. and Chief Financial Officer of Ladenburg
Thalmann Financial Services Inc., the publicly-traded holding
company of Ladenburg Thalmann & Co, Inc., where Mr. Giardina
served as its E.V.P. and Chief Financial Officer from 1998 through
2006 and as its Controller from 1990 through 1998. From 1983
through 1990, Mr. Giardina was an auditor with the national public
accounting firm of Laventhol & Horwath. Mr. Giardina is a
certified public accountant and is Series 27 registered. Mr.
Giardina earned his Bachelor of Business Administration degree
from Pace University in 1983.
About National Holdings
New York, N.Y.-based National Holdings Corporation is a financial
services organization, operating primarily through its wholly
owned subsidiaries, National Securities Corporation, Finance
Investments, Inc., and EquityStation, Inc. The Broker-Dealer
Subsidiaries conduct a national securities brokerage business
through their main offices in New York, New York, Boca Raton,
Florida, and Seattle, Washington.
The Company had a net loss of $4.7 million on $126.5 million
of total revenues for fiscal year ended Sept. 30, 2011, compared
with a net loss of $6.6 million on $111.0 million on total
revenues for fiscal 2010.
The Company's balance sheet at June 30, 2012, showed $15.51
million in total assets, $18.63 million in total liabilities,
$26,000 in non-controlling interest and a $3.14 million in total
National Holdings Corporation stockholders' deficit.
In the auditors' report accompanying the consolidated financial
statements for the year ended Sept. 30, 2011, Sherb & Co., LLP, in
Boca Raton, Florida, expressed substantial doubt about National
Holdings' ability to continue as a going concern. The independent
auditors noted that the Company has incurred significant losses
and has a working capital deficit as of Sept. 30, 2011.
Bankruptcy Warning
The Company said in its quarterly report for the period ended
June 30, 2012, that its future is dependent on its ability to
sustain profitability and obtain additional financing. If the
Company fails to do so for any reason, it would not be able to
continue as a going concern and could potentially be forced to
seek relief through a filing under the U.S. Bankruptcy Code.
NATIVE WHOLESALE: Can Post $2-Mil Collateral to Secure Bonds
------------------------------------------------------------
Native Wholesale Supply Company was authorized by the Bankruptcy
Court to post an additional $2 million in collateral in the form
of a letter of credit to secure its indemnity obligations to
Capitol Indemnity Corporation under certain customs bonds. The
Letter of Credit was issued by M&T Bank and secured by the
Debtor's funds.
The Court said the Debtor may increase the amount of the Letter of
Credit by separate application, on seven days' notice to Capitol,
Grand River, the United States, National Association of Attorneys
General and the United States Trustee.
About Native Wholesale
Native Wholesale Supply Company is engaged in the business of
importing cigarettes and other tobacco products from Canada and
selling them within the United States. It purchases the products
from Grand River Enterprises Six Nations, Ltd., a Canadian
corporation and the Debtor's only secured creditor. Native is an
entity organized under the Sac and Fox Nation and has its
principal place of business at 10955 Logan Road in Perrysburg, New
York.
Native filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No.
11-14009) on Nov. 21, 2011. The Chapter 11 filing was triggered
to resolve an ongoing dispute with the United States government
regarding up to $43 million in assessments made by the government
against the Debtor pursuant to the Fair and Equitable Tobacco
Reform Act of 2004 and the Tobacco Transition Payment Program and
to restructure the terms of payment of any obligation determined
to be owing by the Debtor to the U.S. under the Disputed
Assessment. The issues pertaining to the Disputed Assessment
resulted in two lawsuits, subsequently consolidated, now pending
in the Federal District Court.
Robert J. Feldman, Esq., and Janet G. Burhyte, Esq., at Gross,
Shuman, Brizdle & Gilfillan, P.C., in Buffalo, N.Y., represent the
Debtor as counsel.
The Company disclosed $30,022,315 in assets and $70,590,564 in
liabilities as of the Chapter 11 filing.
The States of California, New Mexico, Oklahoma and Idaho have
appeared in the case and are represented by Garry M. Graber, Esq.,
at Hodgson Russ LLP.
No trustee, examiner or creditors' committee has been appointed in
the case.
NET ELEMENT: Kenges Rakishev Holds 27.1% Equity Stake in NETE
-------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Kenges Rakishev and his affiliates disclosed that, as
of Sept. 28, 2012, they beneficially own 7,654,085 shares of
common stock of Net Element International, Inc., formerly known as
Net Element, Inc., representing 27.1% of the shares outstanding.
Net Element International is trading on the NASDAQ Capital Market
under the ticker symbol "NETE."
Net Element and Cazador Acquisition Corporation previously
completed their business combination. The combined entity was
named "Net Element International Inc."
Prior to the consummation of the transactions contemplated by the
Merger Agreement, Mr. Rakishev caused Novatus Holding PTE. Ltd. to
purchase 2,320,751 shares of Common Stock from certain
stockholders of the Net Elementr for aggregate gross proceeds of
$23,300,340 to help ensure that the Company had the minimum cash
amount of $23,500,000 required by Section 7.03(h) of the Merger
Agreement. All of those 2,320,751 shares of Common Stock were
purchased for $10.04 per share. Mr. Rakishev is the sole
shareholder of Novatus
A copy of the filing is available for free at http://is.gd/VeGGtu
About Net Element
Miami, Fla.-based Net Element, Inc. (formerly TOT Energy, Inc.)
currently operates several online media Web sites in the film,
auto racing and emerging music talent markets.
Following the 2011 results, Daszkal Bolton LLP, in Fort
Lauderdale, Florida, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has experienced recurring losses
and has an accumulated deficit and stockholders' deficiency at
Dec. 31, 2011.
The Company reported a net loss of $24.85 million in 2011,
compared with a net loss of $3.10 million in 2010.
The Company's balance sheet at June 30, 2012, showed $3.22 million
in total assets, $7.69 million in total liabilities, and a
$4.46 million total stockholders' deficit.
NIFTUS LLC: U.S. Trustee Wants Case Converted to Chapter 7
----------------------------------------------------------
W. Clarkson McDow, Jr., United States Trustee for Region 4, asks
the U.S. Bankruptcy Court for the Western District of Virginia for
the entry of an order converting Niftus, LLC's case to one under
chapter 7 of the Bankruptcy Code.
The United Trustee said that given the speculative nature of the
Debtor's income stream and the adversarial nature of the Debtor
relationship with the other members of Royalpharm, LLC,
it appears unlikely that the Debtor will be able to rehabilitate.
About Niftus
Niftus, LLC, filed a bare-bones Chapter 11 petition (Bankr. W.D.
Va. Case No. 12-71123) on June 11 in Roanoke, Virginia. Niftus,
a management consulting services provider from Bluefield,
Virginia, estimated assets of up to $50 million and debts of less
than $10 million. Chief Judge William F. Stone Jr. oversees the
case. Copeland & Bieger, P.C., serves as the Debtor's counsel.
W. Clarkson McDow, Jr., the U.S. Trustee for Region 4, has not
appointed an unsecured creditors committee in the Chapter 11 case
of Niftus, LLC. According to the statement, the number of persons
eligible or willing to serve on such a committee is presently
insufficient to form an unsecured creditors committee.
The U.S. Trustee will appoint an unsecured creditors committee
upon the request of an adequate number of unsecured creditors.
NTELOS HOLDINGS: S&P Rates $475MM Sr. Secured Term Loan 'BB-'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Waynesboro, Va.-based regional wireless carrier NTELOS Holdings
Corp. (NTELOS; BB-/Stable/--) subsidiary NTELOS Inc.'s proposed
$475 million senior secured term loan facility due 2019. The
company will use proceeds to refinance the approximately $460
million outstanding on the current term loan which matures in
2015. "The recovery rating of '4' indicates our expectation for
average (30% to 50%) recovery of principal in the event of a
payment default and reflects our revised approach to estimating
wireless enterprise value in a default scenario by using the
greater of a multiple of projected bankruptcy emergence-level
EBITDA or a discrete asset value, based on the book value of
spectrum and a discounted value of network assets. In NTELOS'
case, the cash flow multiple approach results in the greater
valuation. Our projected distressed EBITDA multiple for NTELOS is
4x and recognizes the company's limited geographic footprint as
well as the substantial, and growing reliance on a wholesale
contract with Sprint Spectrum L.P. Our `BB-' corporate credit
ratings on NTELOS are not affected by the refinancing. The $35
million revolving credit facility ('BB' issue-level rating) will
be terminated as part of the refinancing," S&P said.
"Our ratings on NTELOS recognize the limited scale and geographic
diversity of its wireless properties; intense competition from
national and prepaid carriers; the characteristically higher churn
of its prepaid customers which account for about a third of
NTELOS' retail wireless customer base. As a regional wireless
carrier, NTELOS is at a disadvantage compared with national
carriers' given the latter's scale economies, superior access to
popular wireless devices, and the ability to carry traffic
nationwide largely on their own--not leased--network. A favorable
rating consideration is the good visibility on the material, and
growing, portion of revenue and cash flow from NTELOS' strategic
alliance with Sprint Spectrum L.P. under which NTELOS is the
exclusive personal communication services provider to Sprint's
CDMA customers in NTELOS' western Virginia and West Virginia
service areas. However, given the increasing importance of the
Sprint relationship, the potential that the contract might not be
renewed after July 2015 is a material risk," S&P said.
RATINGS LIST
NTELOS Holdings Corp.
NTELOS Inc.
Corporate Credit Rating BB-/Stable/--
New Rating
NTELOS Inc.
$475 Mil. Sr. Sec. Term Ln Due 2019 BB-
Recovery Rating 4
OAKS AT PARK SOUTH APARTMENTS: Ginkgo Appointed as Receiver
-----------------------------------------------------------
Herald Online reports that Ginkgo Residential has been appointed
as Receiver for Oaks at Park South Apartments in Oxon Hill,
Maryland, by the Circuit Court in Prince George's County,
Maryland.
Ginkgo's history of rehabilitation of distressed assets and its
relationship with various lenders provides an expertise that will
revitalize this asset, according to the report.
"We are pleased to have been selected to help the residents of
this distressed community. . . . We are confident that by
utilizing our expertise and proven platform that we will be able
to improve residents' quality of life and create value for all
stakeholders," the report quoted Philip Payne, CEO of Ginkgo
Residential, as saying.
Ginkgo is a significant operator of apartment communities located
primarily in the South, Southeast and Mid-Atlantic regions of the
United States
This 510 unit apartment community, located off a major
thoroughfare, Indian Head Highway, is just beyond the border of
the District of Columbia and Maryland.
ODYSSEY PICTURES: P. Rodgers Succeeds M. Cronin as Accountant
-------------------------------------------------------------
Odyssey Pictures Corporation Board of Directors, acting through
the Chief Executive Officer, John Foster, accepted, on Aug. 21,
2012, the resignation of Mr. Mike Cronin, CPA, from his engagement
to be the independent certifying accountant for the Company.
On Aug. 21, 2012, the Company engaged Mr. Patrick Rodgers, CPA,
PA, to act as the Company's independent registered public
accountant beginning immediately and, specifically, to complete
the year-end audit for fiscal year 2012 and 2013.
Neither the Company nor anyone acting on the Company's behalf
hired Mr. Patrick Rodgers, CPA, PA, in any capacity, nor consulted
with him as to the application of accounting principles to a
specified transaction, either completed or proposed, or the type
of audit opinion that might be rendered as to the financial
statements, nor was a written report or oral advice rendered that
was an important factor considered by the Company or any of its
employees in reaching a decision as to an accounting, auditing or
financial reporting issue.
The engagement of a new accountant, and the acceptance of the
resignation of the prior accountant was done by the Chief
Executive Officer and Chairman of the Board of the Company with
the knowledge and approval of the other members of the Board of
Directors. The Company does not have an audit committee or any
other committee charged with oversight of financial matters, and
has entrusted this responsibility in its Chief Executive Officer
acting as the Company's Chief Financial Officer.
Since his engagement and to the date of his resignation, there
have not been, nor are there now, any disagreements between the
Company and Mr. Mike Cronin, P.C.
About Odyssey
Plano, Tex.-based Odyssey Pictures Corp., during the nine months
ended March 31, 2012, realized revenues from the sale of branding
and image design products and media placement services. The
Company's ongoing operations have consisted of the sale of these
branding and image design products, increasing media inventory,
productions in progress and development of IPTV Technology and
related services.
The Company's balance sheet at March 31, 2012, showed
$1.01 million in total assets, $3.62 million in total liabilities,
and a stockholders' deficit of $2.61 million.
Michael F. Cronin, in Orlando, Fla., expressed substantial doubt
about Odyssey Pictures' ability to continue as a going concern,
following the Company's results for the fiscal year ended June 30,
2011. The independent auditor noted that the Company has a $1.9
million working capital deficiency. "The Company may not have
adequate readily available resources to fund operations through
June 30, 2012. This raises substantial doubt about the Company's
ability to continue as a going concern."
OLDE PRAIRIE: CenterPoint Asks Court to Dismiss Chapter 11 Case
---------------------------------------------------------------
CenterPoint Properties Trust asks the U.S. Bankruptcy Court for
the Northern District of Illinois, to enter an order on an
emergency basis dismissing the Chapter 11 case Olde Prairie Block
Owner, LLC, for cause or, in the alternative, lifting the
automatic stay to permit CenterPoint to conclude a foreclosure
action pending against the Debtor in the Circuit Court of Cook
County, Illinois, Case No. 09 CH 08190.
CenterPoint holds a claim of more than $70 million secured by all
of the Debtor's assets, consisting of two parcels of commercial
real estate located near McCormick Place in Chicago, Illinois and
a leasehold interest in an adjacent parking garage and related
personal property. According to papers filed with the Court, the
loan was due and payable on Feb. 21, 2009. No amount has ever
been paid by the Debtor to CenterPoint.
CenterPoint puts forth these arguments:
A. The Debtor's bankruptcy was filed in bad faith.
B. The Debtor's case should be dismissed because the value of
the estate is diminishing and the Debtor has no prospect of
rehabilitation.
C. As the Debtor has no prospect of reorganization, the
dismissal of the Debtor's case should be with prejudice to a
subsequent Chapter 11 filing.
The Chapter 11 Plan and Disclosure Statement of THE Debtor are due
by Oct. 19, 2012. A combined hearing on Disclosure Statement,
Plan and motion to dismiss will be held on Nov. 5, 2012, at 1:30
p.m.
About Olde Prairie Block Owner
Olde Prairie Block Owner, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ill. Case No. 12-37599) in Chicago on Sept. 21, 2012,
disclosing assets of $97 million in assets and $80.6 million in
liabilities in its schedules. The Debtor owns two properties: (i)
the Old Prairie Property, a 53,575 square foot parcel that has a
building and a gravel paved lot at E. Cermak Road in Chicago, and
(ii) the Lakeside Property, a 159,960 square-feet property that
contains buildings in Chicago.
The Debtor said CenterPoint Properties Trust has a disputed claim
of $70.8 million, of which $63.3 million is secured. JMB Capital
Partners is owed $3.4 million on account of DIP financing in a
previous Chapter 11 case.
Olde Prairie Block first sought chapter 11 protection (Bankr. N.D.
Ill. Case No. 10-22668) on May 18, 2010. Two years later, the
bankruptcy judge in Chicago dismissed the case and granted
Centerpoint's motion to lift automatic stay to permit its state-
court foreclosure action to proceed.
In the prior case, the Debtor was represented by John Ruskusky,
Esq., George R. Mesires, Esq., and Patrick F. Ross, Esq., at
Ungaretti & Harris LLP, in Chicago. Attorneys at Golan &
Christie, LLP, in Chicago, serve as counsel to the Debtor in the
2012 Chapter 11 case.
CenterPoint is represented in the 2012 case by:
David F. Heroy, Esq.
Erin E. Broderick, Esq.
BAKER & McKENZIE LLP
300 East Randolph Drive, Suite 5000
Chicago, IL 60601
Telephone: (312) 861-8000
Facsimile: (312) 861-2899
E-mail: David.Heroy@bakermckenzie.com
Erin.Broderick@bakermckenzie.com
PENNFIELD CORP: Schedules Filing Deadline Extended to Nov. 6
------------------------------------------------------------
Pennfield Corporation and Pennfield Transport Company sought and
obtained an extension, through Nov. 6, of their deadline to file
schedules of assets and liabilities, and statement of financial
affairs.
Pennfield Corporation and Pennfield Transport Company filed a
Chapter 11 petition (Bankr. E.D. Pa. Case No. 12-19430 and
12-19431) on Oct. 3, 2012, in Philadelphia. Founded in 1919,
Pennfield is a Lancaster, Pennsylvania-based manufacturer of bulf
and bagged feeds for dairy, equine and other commercial and
backyard livestock. The company owns and operates three production
mills located in Mount Joy, Martinsburg, and South Montrose, in
Pennsylvania.
The Debtors filed for bankruptcy to sell their assets to Carlisle
Advisors, LLC, subject to higher and bettr offers. Carlisle has
also agreed to provide a $2.0 million DIP Loan.
Judge Bruce I. Fox presides over the case. Attorneys at
Maschmeyer Karalis P.C., in Philadelphia, serve as the Debtors'
bankruptcy counsel. Skadden, Arps, Slate, Meagher & Flom LLP is
the special counsel. Groom Law Group, Chartered, is the employee
benefits counsel. AEG Partners LLC is the financial advisor.
Lakeshore Food Advisors, LLC, is the investment banker.
Pennfield Corp. estimated $10 million to $50 million in assets and
debts. Pennfield Transport estimated under $1 million in assets
and debts. The petition was signed by Arnold Sumner, president.
PENNFIELD CORP: Sec. 341 Creditors' Meeting Set for Nov. 8
----------------------------------------------------------
The U.S. Trustee for Region 3 will convene a Meeting of Creditors
under 11 U.S.C. Sec. 341(a) in the Chapter 11 cases of Pennfield
Corporation and Pennfield Transport Company on Nov. 8, 2012, at
11:00 a.m. at 833 Chestnut Street, Suite 501, Philadelphia.
Pennfield Corporation and Pennfield Transport Company filed a
Chapter 11 petition (Bankr. E.D. Pa. Case No. 12-19430 and
12-19431) on Oct. 3, 2012, in Philadelphia. Founded in 1919,
Pennfield is a Lancaster, Pennsylvania-based manufacturer of bulf
and bagged feeds for dairy, equine and other commercial and
backyard livestock. The company owns and operates three production
mills located in Mount Joy, Martinsburg, and South Montrose, in
Pennsylvania.
The Debtors filed for bankruptcy to sell their assets to Carlisle
Advisors, LLC, subject to higher and bettr offers. Carlisle has
also agreed to provide a $2.0 million DIP Loan.
Judge Bruce I. Fox presides over the case. Attorneys at
Maschmeyer Karalis P.C., in Philadelphia, serve as the Debtors'
bankruptcy counsel. Skadden, Arps, Slate, Meagher & Flom LLP is
the special counsel. Groom Law Group, Chartered, is the employee
benefits counsel. AEG Partners LLC is the financial advisor.
Lakeshore Food Advisors, LLC, is the investment banker.
Pennfield Corp. estimated $10 million to $50 million in assets and
debts. Pennfield Transport estimated under $1 million in assets
and debts. The petition was signed by Arnold Sumner, president.
PINNACLE AIRLINES: Pilots Assoc. Objects to Motion on CBA
----------------------------------------------------------
BankruptcyData.com reports that the Air Line Pilots Association,
International filed with the U.S. Bankruptcy Court an objection to
Pinnacle Airlines' motion to reject collective bargaining
agreements with the Air Line Pilots Association, International and
the Association of Flight Attendants-CWA. The objection was filed
under seal, so details are unavailable.
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.
The official committee of unsecured creditors tapped Morrison &
Foerster LLP as its counsel, and Imperial Capital, LLC, as
financial advisors.
Pinnacle has the exclusive right to propose a reorganization plan
until Jan. 25.
PQ CORP: S&P Affirms 'B' CCR; Outlook Revised on Debt Refinancing
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on PQ Corp.
to stable from negative. "We also affirmed our 'B' corporate
credit rating and assigned our 'B+' issue ratings and '2' recovery
ratings to the company's proposed first-lien senior secured credit
facilities consisting of a $150 million revolving credit facility
and a $1.1 billion term loan. The '2' recovery rating indicates
our expectation for substantial recovery (70%-90%) in the event of
a payment default. In addition, we assigned our 'B-' issue rating
and '5' recovery rating to the proposed $720 million in second-
lien notes. The '5' recovery rating indicates our expectation for
modest recovery (10%-30%) in the event of a payment default. All
ratings reflect preliminary terms and conditions. We will withdraw
our ratings on Potters and on existing debt at PQ following the
successful completion of the proposed transaction," S&P said.
"The outlook revision to stable from negative reflects our
expectation that the debt refinancing will reduce PQ's refinancing
risk by extending maturities, including 2014 maturities of about
$1 billion in debt," said credit analyst Paul Kurias. "Our ratings
on Malvern Pa.-based PQ Corp. reflect the company's 'highly
leveraged' financial profile, including very aggressive financial
policies and its 'fair' business risk profile."
"The stable outlook reflects our anticipation of modest
improvements to liquidity and to the debt maturity profile
resulting from the transaction, and expected stabilizing of credit
metrics. Additionally, the combination with Potters diminishes
somewhat, but does not eliminate, our view of the income risks and
cash flow volatility arising out of the exposure to challenging
European markets over the next 12 months. Still, we believe that
the company has little cushion for any unexpected setbacks to
earnings or cash flow given the high levels of debt leverage.
Leverage credit metrics are weak relative to our expectation at
the rating. We believe there will be a very gradual strengthening
in these metrics arising out of gradual improvements in earnings,"
S&P said.
"We could lower ratings if this anticipated strengthening does not
materialize or if earnings or liquidity weaken so that leverage
credit metrics deteriorate from current levels. This could happen
if revenue growth stalls or turns negative, or if EBITDA margins
decline by more than two percentage points from current levels. We
could lower ratings if the combination and related financing does
not take place, which would likely, heighten credit risks,
including refinancing risk, as we approach the 2014 maturity date
for about $1 billion in PQ debt," S&P said.
"The company's highly leverage financial risk profile constrain
the ratings. We would raise the ratings if the financial risk
profile improved due to greater earnings growth than we expected,
or if the company paid down meaningful levels of debt, though we
currently do not believe PQ will generate sufficient cash flow to
do so. We could also upgrade the company if the ratio of funds
from operations-to-total debt exceeded 12% on a sustainable
basis," S&P said.
PRECISION OPTICS: Austin Marxe Discloses 30.5% Equity Stake
-----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Austin W. Marxe and David M. Greenhouse
disclosed that, as of Sept. 30, 2012, they beneficially own
1,361,790 shares of common stock of Precision Optics Corp.
representing 30.5% of the shares outstanding. The reporting
persons previously reported beneficial ownership of 610,401
common shares or a 39.7% equty stake as of Feb. 29, 2012. A copy
of the amended Schedule 13D is available at http://is.gd/K45HSR
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.
REALOGY CORP: S&P Hikes CCR to 'B' on IPO and Debt Conversion
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Realogy Corp. to 'B' from 'CCC' and removed it, along
with all related issue-level ratings, from CreditWatch, where it
was placed with positive implications Sept. 28, 2012. The rating
outlook is stable.
"The action follows the completion of the company's IPO of its
common stock. Concurrent with and in addition to the IPO, Realogy
converted $1.9 billion in convertible debt to common stock. The
company expects to use $1.02 billion in net proceeds from the IPO
to repay $650 million in 13.5% second-lien notes due 2017, $64
million in 10.5% senior unsecured notes due 2014, $41 million in
11% senior pay-in-kind (PIK) notes due 2014; to redeem $207
million in principal amount of 11% convertible notes due 2018; and
to pay fees and expenses and other anticipated costs," S&P said.
In addition, S&P said it took these rating actions:
-- S&P raised the issue-level rating on Realogy's first-lien
senior secured debt two notches to 'B+' from 'B-' and revised
the recovery rating on this debt to '2' from '1'.
-- S&P raised the issue-level rating on Realogy's first-and-a-
half lien senior secured debt two notches to 'CCC+' from
'CCC-' and revised the recovery rating on this debt to '6'
from '5'.
-- S&P raised the issue-level rating on Realogy's senior
unsecured and subordinated debt three notches to 'CCC+' from
'CC'. The recovery rating on this debt remains '6'.
"The downward recovery rating revisions on the first- and 1.5-lien
debt reflects weaker recovery prospects for these lenders under
our simulated default scenario. With the lower debt service levels
pro forma for the IPO and debt conversion, Realogy's EBITDA would
have to decline further to trigger a payment default compared with
the company's existing capital structure. This would reduce
Realogy's enterprise value and first- and 1.5-lien recovery
prospects in a default scenario," S&P said.
"The three-notch upgrade for the corporate credit rating to 'B'
reflects the completion of the IPO and debt conversion, which
resulted in a significant reduction of approximately $2.8 billion
in debt (compared with $7.6 billion in reported funded and
securitization debt as of June 2012) and the decrease of
approximately $330 million in interest expense (compared with $672
million in the 12 months ended June 2012). This is a material de-
leveraging event that offers significant debt service relief for
the company. However, our assessment of the company's financial
risk profile remains 'highly leveraged,' according to our
criteria. Pro forma for the completion of the IPO, our measure of
total lease and securitization adjusted debt to EBITDA (leverage)
improved to about 9.5x from 16.0x as of June 2012. Incorporating
our current expectation of good EBITDA growth in the second half
of 2012 and in 2013, this pro forma leverage measure would improve
to about 8x by December 2012 and to the low-7x area in 2013. Pro
forma EBITDA coverage of interest expense increased to around 1.5x
from 0.7x as of June 2012. Under our performance expectations,
this measure would improve to the high-1x area in 2012 and be
sustained at a similar level in 2013," S&P said.
"The rating also reflects our assessment of the company's business
risk profile as 'satisfactory,' according to our criteria. This is
based on Realogy's strong residential real estate brokerage
brands, including CENTURY 21, Coldwell Banker, The Corcoran Group,
ERA, and Sotheby's; good market position; and geographic
diversity," S&P said.
RENT-A-CENTER INC: S&P Ups CCR to 'BB+' on Improved Credit Ratios
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Plano, Texas-based rent-to-own retailer Rent-A-Center
Inc. to 'BB+' from 'BB'. The outlook is stable.
"At the same time, we raised our issue-level rating on the
company's $300 million 6.625% senior notes to 'BB' (one notch
below the corporate credit rating) from 'BB-'. The recovery rating
remains '5', indicating our expectation of modest (10% to 30%)
recovery for noteholders in the event of a payment default or
bankruptcy," S&P said.
"The rating action reflects Standard & Poor's expectation that the
company has both the willingness and ability to maintain credit
ratios indicative of an intermediate financial risk profile," said
Standard & Poor's credit analyst Diya Iyer. "We continue to view
the company's business risk profile as fair."
"The outlook is stable, reflecting our expectation for the company
to maintain credit ratios indicative of an intermediate financial
risk profile and for the company's business risk profile to remain
fair for at least the next two years," S&P said.
"We could lower our ratings if the company is unable, through
weaker operating performance, or unwilling, through debt-financed
share repurchases or dividends, to maintain credit ratios
indicative of an intermediate financial risk profile, which
includes leverage sustained below 3x. Based on second-quarter
financial results, an EBITDA decline of between 7% and 7.5% or
a debt increase of nearly $100 million would cause leverage to
increase to 3.0x," S&P said.
"It is unlikely we will raise our ratings within the next two
years, because we believe the company's business risk profile will
remain fair for that time. The company's ability to replicate the
success of its U.S.-based business model in other countries would
improve its geographic diversity, which could be a catalyst for a
higher business risk profile. We believe it will take a
considerable amount of time for the company to build similar scale
in an international market," S&P said.
SEARS HOLDINGS: Rights Offering Expires; 95% Shares Subscribed
--------------------------------------------------------------
Sears Holdings Corporation announced that the subscription period
of its previously announced rights offering to effect the
separation of Sears Hometown and Outlet Stores, Inc., from Sears
Holdings expired at 5:00 p.m., New York City time, on Oct. 8,
2012. Sears Holdings previously announced that the rights
offering would expire on Oct. 8, 2012, unless extended by Sears
Holdings' Board of Directors.
Preliminary results indicate that over 95% of the outstanding
shares of common stock of Sears Hometown, par value $0.01 per
share, were subscribed for pursuant to the exercise of basic
subscription rights by holders of the subscription rights. In
addition, holders of subscription rights who exercised their basic
subscription rights in full requested to purchase a number of
additional shares of Common Stock pursuant to the over-
subscription privilege such that the rights offering is expected
to be fully subscribed. Accordingly, Sears Holdings expects to
distribute a total of 23,100,000 shares of Common Stock to the
holders of subscription rights who validly exercised their
subscription rights and paid the subscription price in full,
including pursuant to the exercise of the over-subscription
privilege.
Based on these preliminary results, Sears Holdings estimates that
it will receive aggregate gross proceeds from the rights offering
of approximately $346.5 million. As part of the separation
transactions, Sears Hometown will enter into an asset-based senior
secured revolving credit facility with a group of financial
institutions to provide (subject to availability under a borrowing
base) for aggregate maximum borrowings of $250 million. Sears
Hometown plans to draw $100 million under this facility to pay a
cash dividend to Sears Holdings prior to its separation from Sears
Holdings, which will constitute a portion of the $446.5 million in
anticipated gross proceeds to Sears Holdings from the separation
transactions.
Subscription rights that were not properly exercised by 5:00 p.m.,
New York City time, on Oct. 8, 2012, have expired and are no
longer exercisable.
The results of the rights offering and Sears Holdings' estimates
regarding the number of shares to be issued and the gross proceeds
to be received by Sears Holdings are preliminary and subject to
finalization and verification by the subscription agent,
Computershare, Inc.
Sears Holdings expects that on Oct. 11, 2012, after the
subscription agent has effected all allocations and adjustments
contemplated by the terms of the rights offering, the rights
offering will be completed and the subscription agent will
distribute, by way of direct registration in book-entry form, the
shares of Common Stock to holders of subscription rights who
validly exercised their subscription rights and paid the
subscription price in full. No physical share certificates will
be issued.
Sears Hometown expects that the Common Stock will begin to trade
on the Nasdaq Capital Market under the symbol "SHOS" on Oct. 12,
2012.
About Sears
Hoffman Estates, Illinois-based Sears Holdings Corporation
(Nasdaq: SHLD) -- http://www.searsholdings.com/-- is the nation's
fourth largest broadline retailer with more than 4,000 full-line
and specialty retail stores in the United States and Canada.
Sears Holdings operates through its subsidiaries, including Sears,
Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a
94% stake in Sears Canada and an 80.1% stake in Orchard Supply
Hardware. Key proprietary brands include Kenmore, Craftsman and
DieHard, and a broad apparel offering, including such well-known
labels as Lands' End, Jaclyn Smith and Joe Boxer, as well as the
Apostrophe and Covington brands. It also has the Country Living
collection, which is offered by Sears and Kmart.
Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary
Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on
Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6,
2003, pursuant to the terms of an Amended Joint Plan of
Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden,
Arps, Slate, Meagher & Flom, LLP, represented the retailer in its
restructuring efforts. The Company's balance sheet showed
$16,287,000,000 in assets and $10,348,000,000 in debts when it
sought chapter 11 protection. Kmart bought Sears, Roebuck & Co.,
for $11 billion to create the third-largest U.S. retailer, behind
Wal-Mart and Target, and generate $55 billion in annual revenues.
Kmart completed its merger with Sears on March 24, 2005.
The Company's balance sheet at July 28, 2012, showed $21.18
billion in total assets, $16.68 billion in total liabilities and
$4.49 billion in total equity.
Negative Outlook
Standard & Poor's Ratings Services in January 2012 lowered its
corporate credit rating on Hoffman Estates, Ill.-based Sears
Holdings Corp. to 'CCC+' from 'B'. "We removed the rating from
CreditWatch, where we had placed it with negative implications on
Dec. 28, 2011. We are also lowering the short-term and commercial
paper rating to 'C' from 'B-2'. The rating outlook is negative,"
S&P said.
"The corporate credit rating reflects our projection that Sears'
EBITDA will be negative in 2012, given our expectations for
continued sales and margin pressure," said Standard & Poor's
credit analyst Ana Lai. She added, "We further expect that
liquidity could be constrained in 2013 absent a turnaround
or substantial asset sales to fund operating losses."
Moody's Investors Service in January 2012 lowered Sears Holdings
Family and Probability of Default Ratings to B3 from B1.
The outlook remains negative. At the same time Moody's affirmed
Sears' Speculative Grade Liquidity Rating at SGL-2.
The rating action reflects Moody's expectations that Sears will
report a significant operating loss in fiscal 2011. Moody's added
that the rating action also reflects the company's persistent
negative trends in sales, which continue to significantly
underperform peers.
SIERRA NEGRA: Hiring Fair Anderson as Accountants
-------------------------------------------------
Sierra Negra Ranch,LLC, asks the U.S. Bankruptcy Court for the
District of Nevada for authorization to employ Fair Anderson &
Langerman to provide accounting services during the course of the
Debtor's Chapter 11 case, nunc pro tunc to Sept. 11, 2012.
FAL has agreed to provide these services:
a. Financial Statements: Compilation, based on information to
be provided by Debtor, of the Statement of Assets,
Liabilities, and Members' Equity - Income Tax Basis and the
related Statement of Revenues, Expenses and Members' Equity
- Income Tax Basis of Sierra Negra Ranch, LLC as of and for
the year ended Dec. 31, 2012, and issue an accountants'
report thereon in accordance with Statements on Standards
for Accounting and Review Services issued by the American
Institute of Certified Public Accountants;
b. 2012 Tax Return Preparation: (i) Preparation of the federal
income tax return for the year ended Dec. 31, 2012; (ii)
Preparation of the Arizona state income tax return for the
year ended Dec. 31, 2012; and (iii) Preparation of any
bookkeeping entries necessary in connection with the
preparation of the tax returns.
The Debtor believes FAL is disinterested within the meaning of
Sections 101(14) and 327 of the Bankruptcy Code, as modified by
Section 1107(b) of the Bankruptcy Code.
For the compilation services the proposed fee arrangement will be
a fixed fee of $3,395 and for the tax returns the proposed fee
arrangement will be a fixed fee of $2,425. Additionally, the
Engagement Agreement states that Debtor will be charged an
additional $250 for other out-of-pocket expenses such as report
production, work processing, computer expenses, and postage.
The hearing to consider the employment application of Fair
Anderson & Langerman as the Debtor's accountants is scheduled for
Nov. 7, 2012, at 2:00 p.m.
About Sierra Negra
Las Vegas, Nevada-based Sierra Negra Ranch, LLC, is a limited
liability company organized in November 2004 to purchase an
aggregate of approximately 2,757.5 acres of undeveloped land in
the Tonopah area of incorporated Maricopa County, west of Phoenix,
Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D.
Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. Candace C.
Clark, Esq., and Gerald M. Gordon, Esq., at Gordon Silver, in Las
Vegas, Nev., represent the Debtor as counsel.
In its amended schedules, the Debtor disclosed $26,197,986 in
total assets and $4,801,931 in total liabilities. The Debtor is
"Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B)
and its asset is located in Maricopa County, Arizona.
SIERRA NEGRA: Hiring Withey Morris as Special Real Estate Counsel
-----------------------------------------------------------------
Sierra Negra Ranch, LLC, asks the U.S. Bankruptcy Court for the
District of Nevada for authorization to employ Withey Morris PLC
as Debtor's special real estate, zoning, and land use counsel,
nunc pro tunc to Sept. 19, 2012.
Debtor seeks to retain Withey Morris to represent it with respect
to the administrative process related to securing the land use
entitlements for the Property, and specifically, requesting an
extension of the Entitlement Conditions Satisfaction Date, and
matters related thereto.
The Debtor believes Withey Morris do not hold or represent to the
Debtor's creditors or any other party-in-interest, or their
respective attorneys and accountants, with rrespect to the matters
on which Withey Morris is to be employed.
Withey Morris' current hourly rates range from $195 for land
planners or paralegals to $285 for associates and $395 for
partners. Withey Morris will also seek reimbursement for
necessary costs incurred. Withey Morris, Esq., will primarily be
responsible for providing the services, and his current hourly
rate is $395.
The hearing to consider the employment application of Withey
Morris as the Debtor's real estate, zoning, and land use counsel
is scheduled for Nov. 7, 2012, at 2:00 p.m.
About Sierra Negra
Las Vegas, Nevada-based Sierra Negra Ranch, LLC, is a limited
liability company organized in November 2004 to purchase an
aggregate of approximately 2,757.5 acres of undeveloped land in
the Tonopah area of incorporated Maricopa County, west of Phoenix,
Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D.
Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. Candace C.
Clark, Esq., and Gerald M. Gordon, Esq., at Gordon Silver, in Las
Vegas, Nev., represent the Debtor as counsel.
In its amended schedules, the Debtor disclosed $26,197,986 in
total assets and $4,801,931 in total liabilities. The Debtor is
"Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B)
and its asset is located in Maricopa County, Arizona.
SIERRA NEGRA: Amends Schedules of Assets and Liabilities
--------------------------------------------------------
Sierra Negra Ranch, LLC, filed with the U.S. Bankruptcy Court for
the District of Nevada amended schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $25,949,250
B. Personal Property $248,736
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $4,619,277
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $182,654
----------- -----------
TOTAL $26,197,986 $4,801,931
About Sierra Negra
Las Vegas, Nevada-based Sierra Negra Ranch, LLC, is a limited
liability company organized in November 2004 to purchase an
aggregate of approximately 2,757.5 acres of undeveloped land in
the Tonopah area of incorporated Maricopa County, west of Phoenix,
Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D.
Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. Candace C.
Clark, Esq., and Gerald M. Gordon, Esq., at Gordon Silver, in Las
Vegas, Nev., represent the Debtor as counsel.
The Debtor is "Single Asset Real Estate" as defined in 11 U.S.C.
Sec 101(51B) and its asset is located in Maricopa County, Arizona.
SOLYNDRA LLC: Investors Sought Tax Break Prior to Bankruptcy
------------------------------------------------------------
Tom Hals and Dan Levine at Reuters, citing court documents, report
that eight months before Solyndra LLC filed for bankruptcy, the
company's politically connected backer sought to hold on to
lucrative tax breaks in the event the company went out of
business.
According to Reuters, the new information was revealed on by the
U.S. Internal Revenue Service, which filed an official objection
to Solyndra's bankruptcy reorganization plan.
Reuters says the failure of Solyndra, the company President Obama
held up as an example of government backing for renewable energy
jobs, is a political weapon for Republicans ahead of the November
elections as they highlight energy policies more favorable to
fossil fuels.
The report notes Solyndra has auctioned virtually everything from
inventory, office equipment and real estate to repay its debts,
but may prove unable to pay any of its unsecured creditors.
The report notes Solyndra's bankruptcy plan could prove a further
embarrassment to the administration if it is seen rewarding risk-
driven venture capitalists ahead of unsecured creditors such as
suppliers and laid-off staff.
The report says, in its court filing on Oct. 10, 2012, the IRS
opposed Solyndra's plan. If approved by creditors, a holding
company would emerge from bankruptcy with no employees or business
operations -- but as much as $350 million in tax breaks that could
be used by Solyndra's investors, including Argonaut Ventures.
The report notes Argonaut is the investment arm of a foundation
tied to the Democratic fundraiser, Oklahoma billionaire George
Kaiser. Most of the tax breaks would come in the form of Net
Operating Losses which could be used to offset future taxable
income.
According to the report, the IRS noted that under the bankruptcy
plan, Solyndra's creditors would receive pennies on the dollar,
and that the principal purpose of the plan is "tax avoidance."
The report says, as Argonaut, Solyndra and its tax professionals
worked to determine the amount of tax breaks available to
Solyndra, the company's chief financial officer was advised to
delay a particular transaction which would have reduced the
available NOLs by $100 million, the court filing said.
According to the report, Solyndra has said in recent court filings
it may not be able to repay any of the $528 million that the U.S.
government had lent in 2009 to promote clean energy businesses.
The report adds Republicans have seized on Solyndra's failure to
accuse the White House of rushing the $528 million loan in part to
help the venture capital backers. The Obama administration has
said the loan was based on the merits of Solyndra's business
prospects.
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 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.
Solyndra filed a liquidating plan at the end of July and scheduled
a hearing on Sept. 7 for approval of the explanatory disclosure
statement. The Plan is designed to pay 2.5% to 6% to unsecured
creditors with claims totaling as much as $120 million. Unsecured
creditors with $27 million in claims against the holding company
are projected to have a 3% dividend.
SOLYNDRA LLC: Unite Here Opposes Bankruptcy Plan
------------------------------------------------
Officials of UNITE HERE, a hospitality workers union with 250,000
members, have taken the unusual step of publicly denouncing a
proposed bankruptcy reorganization plan.
They are in part reacting to conservative politicians denouncing
the millions in federal subsidies and loan guarantees given to
Solyndra, the Fremont, CA-based solar cell company which filed for
bankruptcy in September 2011. Mitt Romney referred to it in this
past Wednesday's presidential debate, and also held a campaign
event in front of Solyndra's shuttered factory gates.
"What has usually been missing from this past year's commentary is
that much of Solyndra's funding came from private sources.
Prominent among them is Madrone Capital, a private equity firm
which acts as an investment arm of the Walton family fortune. The
Waltons are active supporters of Republicans," noted UNITE HERE
Secretary-Treasurer Sherri Chiesa. She also noted the connection
to Hyatt Hotels. "Madrone's co-managing partner Greg Penner is a
director of Hyatt Hotels, controlled by the prominent Pritzker
family," Chiesa explained.
Solyndra's creditors are now voting on the company's proposed
bankruptcy plan (October 10th is the voting deadline). The plan,
if passed, will heavily benefit Madrone and other major investors
at the expense of Solyndra's smaller creditors and the federal
government, which will likely recoup only 3 cents and less than 19
cents on the dollar, respectively. UNITE HERE General Counsel
Richard McCracken noted, "In principle, bankruptcy plans are
supposed to protect creditors over shareholders because
shareholders get all the upside if a company does well - that is
part of the inherent risk in making an equity investment." But
Solyndra's plan would give these investors all of this Company's
tax credits. These tax credits are likely worth $318 million to
$352 million, according to the bankruptcy disclosure statement.
For these credits, investors Madrone and Argonaut would pay at
most $10.2 million (most of which is accompanied by assigning them
various claims).
Madrone's co-managing partner Greg Penner is a current Wal-Mart
director, a former Wal-Mart executive and the current husband of
Carrie Walton. According to Enphase Energy, "Madrone invests on
behalf of members of the Walton Family" (Madrone general partner
Jamie McJunkin sits on the Enphase board). Penner also sits on
the boards of Hyatt Hotels Corporation, Baidu (the Chinese search
engine company similar to Google) and 99Bill Corporation (the
Chinese online payment platform company similar to PayPal).
"With that kind of profile, there can be little doubt that Madrone
and Penner can afford to give Solyndra's creditors and the
American taxpayer a better share of Solyndra's unused hundreds of
millions in tax benefits," Chiesa noted.
On October 17th, the proposed plan will go before a judge in a
Wilmington, DE federal bankruptcy court hearing. It is unclear as
of now whether Solyndra's creditors or the federal courts will
ultimately uphold the proposed bankruptcy plan. "In the interest
of taxpayers like our Union's members and Solyndra's creditors
alike, this deal does not deserve to see the light of day," Chiesa
concluded.
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 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.
Solyndra filed a liquidating plan at the end of July and scheduled
a hearing on Sept. 7 for approval of the explanatory disclosure
statement. The Plan is designed to pay 2.5% to 6% to unsecured
creditors with claims totaling as much as $120 million. Unsecured
creditors with $27 million in claims against the holding company
are projected to have a 3% dividend.
SPANISH BROADCASTING: Fails to Comply with Market Value Rule
------------------------------------------------------------
Spanish Broadcasting System, Inc., received a written deficiency
notice from The Nasdaq Stock Market advising the Company that the
market value of its Class A common stock for the previous 30
consecutive business days had been below the minimum $15,000,000
required for continued listing on the NASDAQ Global Market
pursuant to NASDAQ Listing Rule 5450(b)(3)(C).
Pursuant to NASDAQ Listing Rule 5810(c)(3)(D), the Company has
been provided an initial grace period of 180 calendar days, or
until April 1, 2013, to regain compliance with the Rule. The
Notice further provides that NASDAQ will provide written
confirmation stating that the Company has achieved compliance with
the Rule if at any time before April 1, 2013, the market value of
the Company's publicly held shares closes at $15,000,000 or more
for a minimum of 10 consecutive business days. If the Company
does not regain compliance with the Rule by April 1, 2013, NASDAQ
will provide written notification to the Company that the
Company's common stock is subject to delisting from the Nasdaq
Global Market, at which time the Company will have an opportunity
to appeal the determination to a NASDAQ Hearings Panel.
The Company intends to use all reasonable efforts to maintain the
listing of its common stock on the NASDAQ Global Market, but there
can be no guarantee that the Company will regain compliance with
the Market Value of Publicly Held Shares Requirement.
About Spanish Broadcasting
Headquartered in Coconut Grove, Florida, Spanish Broadcasting
System, Inc. -- http://www.spanishbroadcasting.com/-- owns and
operates 21 radio stations targeting the Hispanic audience. The
Company also owns and operates Mega TV, a television operation
with over-the-air, cable and satellite distribution and affiliates
throughout the U.S. and Puerto Rico. Its revenue for the twelve
months ended Sept. 30, 2010, was approximately $140 million.
The Company's balance sheet at June 30, 2012, showed $466.74
million in total assets, $418.02 million in total liabilities,
$92.34 million in cumulative exchangeable redeemable preferred
stock, and a $43.63 million total stockholders' deficit.
* * *
In November 2010, Moody's Investors Service upgraded the corporate
family and probability of default ratings for Spanish Broadcasting
System, Inc., to 'Caa1' from 'Caa3' based on improved free cash
flow prospects due to better than anticipated cost cutting and the
expiration of an unprofitable interest rate swap agreement.
Moody's said Spanish Broadcasting's 'Caa1' corporate family rating
incorporates its weak capital structure, operational pressure in
the still cyclically weak economic climate, generally narrow
growth prospects (though Spanish language is the strongest growth
prospect) given the maturity and competitive pressures in the
radio industry, and the June 2012 maturity of its term loan
magnify this challenge.
In July 2010, Standard & Poor's Ratings Services raised its
corporate credit rating on Miami, Fla.-based Spanish Broadcasting
System Inc. to 'B-' from 'CCC+', based on continued improvement in
the company's liquidity position. The rating outlook is stable.
"The rating action reflects S&P's expectation that, despite very
high leverage, SBS will have adequate liquidity over the
intermediate term to meet debt maturities, potential swap
settlements, and operating needs until its term loan matures on
June 11, 2012," said Standard & Poor's credit analyst Michael
Altberg.
SPRINT NEXTEL: S&P Puts 'B+' CCR on Watch Pos on Softbank Talks
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B+' corporate
credit rating, and all other ratings, on Overland Park, Kan.-based
wireless service provider Sprint Nextel Corp. on CreditWatch with
positive implications. The CreditWatch placement follows Sprint
Nextel's announcement that it is in talks with Japan's Softbank
Corp. (BBB/Stable/--), which is seeking to buy all or part of
Sprint Nextel.
"The CreditWatch placement reflects the possibility that we could
raise our ratings on Sprint Nextel if Softbank is successful in
its negotiations to acquire a large stake in the company," S&P
said.
"An important factor in our analysis would be the degree of
support we would attribute to the higher-rated Softbank," said
Standard & Poor's credit analyst Allyn Arden. "While we would not
expect to equalize the ratings on Sprint Nextel with those on
Softbank in the absence of debt guarantees, it is possible that we
might impute some degree of support in the ratings, which could
also lead to a higher rating on Sprint Nextel than it would have
on a stand-alone basis."
"While there is no information on how such a transaction would be
financed, Standard & Poor's believes that an acquisition could
also lead to improvement in Sprint Nextel's financial risk
profile, which we currently view as 'highly leveraged,'" S&P said.
"Preliminarily, we do not believe a potential acquisition would
offer meaningful synergies since the two companies operate in
different geographic markets, nor do we expect any direct benefits
to the current business risk assessment, which we currently view
as 'fair.' Nevertheless, Sprint Nextel would likely benefit from
having a parent company with greater financial resources to help
fund its network upgrade and accelerate its rollout of fourth-
generation (4G) services under the Long Term Evolution (LTE)
standard," S&P said.
"As part of our CreditWatch review we will monitor developments
related to the discussions between the two companies. We could
raise or affirm the ratings on Sprint Nextel if an acquisition or
large investment by Softbank is ultimately consummated. We would
expect to provide more clarity on the ultimate ratings outcome if
an agreement is announced and the two companies provide more
information on financing and strategic direction," S&P said.
STAFFORD RHODES: Creditors to Appeal Order Denying Case Dismissal
-----------------------------------------------------------------
LSREF2 Baron, LLC, LSREF2 Baron 2, LLC, and Wells Fargo Bank,
N.A., by and through Hudson Americas LLC, a secured creditor and
party-in-interest in the Chapter 11 cases of Stafford Rhodes, LLC,
filed a motion requesting leave of the United States District
Court for the Middle District of Georgia1 to appeal the Order of
the Bankruptcy Court denying their motion to dismiss Stafford
Rhode's cases.
The Secured Creditors believe the motion should be granted because
the Appeal involves a question of law "for which there is a
substantial ground for difference of opinion and this Appeal would
advance the ultimate termination of the Bankruptcy Cases."
Counsel to the Secured Creditors, Paul M. Rosenblatt, Esq., at
Kilpatrick Townsend & Stockton LLP, notes that each Debtor owns
only one asset and the Bankruptcy Cases are each single asset real
estate cases. The Lender's claims exceed 98% of claims of each
Debtor and 99% on a consolidated basis.
The Collateral was the subject of two foreclosure proceedings when
the Bankruptcy Cases were filed in June 2012, due to the Maturity
Defaults and the Debtors' arrearages on the Loans. The Foreclosure
Sale was scheduled for July 3, with respect to the Debtors' Vista
Property and the Wesley Property, and a foreclosure proceeding was
pending against the Rhodes Property and the Beaufort Property.
Mr. Rosenblatt states that the bankruptcy case involves a two-
party dispute between the Debtors and Lender that can be resolved
in actions pending in courts in South Carolina and in Georgia by
non-judicial foreclosure. The Bankruptcy Cases were filed just a
few days prior to the scheduled Foreclosure Sales for the Vista
Property and the Wesley Property and after initiation of the South
Carolina Action. The Debtors' agent sent the Lender a letter
threatening bankruptcy filing and detailing time and expense that
the threatened bankruptcy proceeding would entail.
The Secured Lenders are represented by:
Paul M. Rosenblatt, Esq.
Shane G. Ramsey, Esq.
KILPATRICK TOWNSEND & STOCKTON LLP
1100 Peachtree Street, Suite 2800
Atlanta, GA 30309
Tel: (404) 815-6500
Fax: (404) 815-6555
Email: prosenblatt@kilpatricktownsend.com
sramsey@kilpatricktownsend.com
About Stafford Rhodes
Stafford Rhodes, LLC, owns 27.41 acres of land located in
Bluffton, Beaufort County, South Carolina. The land is improved
by a 95,233 square foot retail shopping center that has 16
tenants, including Best Buy Stores, Petco, and Dollar Tree.
Affiliate Beaufort Crossing, LLC, owns 10 acres of land, improved
by an unanchored 19,600 square foot shopping center, the Crossings
of Beaufort, in Beaufort County. Stafford Vista, LLC, owns 5.69
acres of land located in Decatur, DeKalb County, Georgia, which is
improved by a 45,450 square foot shopping center identified as the
Vista Grove Plaza. Stafford Wesley, LLC, has 2.34 acres of land
in Decatur, improved by a 30,683 square foot shopping center
identified as the Wesley Chappel Retail Shopping Center.
Stafford Rhodes and its three affiliates sought Chapter 11
protection (Bankr. M.D. Ga. Lead Case No. 12-70859) on June 29,
2012. Judge John T. Laney, III, presides over the Debtors' cases.
Attorneys at Arnall Golden Gregory LLP, in Atlanta, represent the
Debtors as counsel. In its petition, Stafford Rhodes listed
assets and debts of between $10 million and $50 million. The
petitions were signed by Frank J. Jones, Jr., VP, Treasurer and
CFO of Debtor's sole member.
STEREOTAXIS INC: Wellington Management Does Not Own Common Shares
-----------------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Wellington Management Company, LLP, disclosed
that, as of Sept. 30, 2012, he does not beneficially own any
shares of common stock of Stereotaxis, Inc. A copy of the filing
is available for free at http://is.gd/CLVXlr
About Stereotaxis
Based in St. Louis, Mo., Stereotaxis, Inc., designs, manufactures
and markets the Epoch Solution, which is an advanced remote
robotic navigation system for use in a hospital's interventional
surgical suite, or "interventional lab", that the Company believes
revolutionizes the treatment of arrhythmias and coronary artery
disease by enabling enhanced safety, efficiency and efficacy for
catheter-based, or interventional, procedures.
For the year ended Dec. 31, 2011, Ernst & Young LLP, in St. Louis,
Missouri, expressed substantial doubt about Stereotaxis' ability
to continue as a going concern. The independent auditors noted
that the Company has incurred recurring operating losses and has a
working capital deficiency.
The Company reported a net loss of $32.0 million for 2011,
compared with a net loss of $19.9 million for 2010.
The Company's balance sheet at June 30, 2012, showed $36.61
million in total assets, $50.09 million in total liabilities and a
$13.47 million total stockholders' deficit.
SUNAC CHINA: Fitch Assigns 'BB-' Final Rating on $400-Mil. Notes
----------------------------------------------------------------
Fitch Ratings has assigned property developer Sunac China Holdings
Limited's (Sunac, 'BB-'/Stable) USD400 million 12.5% notes due
2017 a final rating of 'BB-'. The assignment of the final rating
follows the receipt of documents conforming to information already
received and the final rating is in line with the expected rating
assigned on Oct 4, 2012.
The notes are rated at the same level as Sunac's to reflect that
they represent direct, unconditional, unsecured and unsubordinated
obligations of the company.
Sunac's ratings are supported by its strong housing presales
performance and its increased business scale in the Chinese
housing market. The ratings are constrained by Sunac's limited
geographical diversification and product mix.
What Could Trigger A Rating Action?
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- adverse changes to Sunac's markets and product mix leading to
an EBITDA margin below 25% (2011: 28.1%)
-- aggressive land-bank acquisitions resulting in funds from
operations (FFO) interest coverage below 3x (2.6x in 2011 but
Fitch expects this to exceed 3.5x from 2012) or net
debt/inventory above 35% (34% in 2011)
-- contracted sales in 2012 of under CNY20bn
Positive: Positive rating action is not expected in the next 24
months given the constraints posed by its limited product mix and
lack of diversification.
TEN SAINTS: Hiring Kenneth Wiles as Interest Rate Expert
--------------------------------------------------------
Ten Saints LLC asks the U.S. Bankruptcy Court for the District of
Nevada for authorization to employ Kenneth M. Wiles of Acceleron
Group, LLC, to provide expert witness services to Debtor in
connection with the formation and confirmation of Debtor's plan of
reorganization. Specifically, the Debtor requests an order
authorizing the retention of Mr. Wiles for the purpose of serving
as Debtor's interest rate expert in its Chapter 11 case.
The Debtor believes Mr. Wiles and Acceleron's professionals are
disinterested within the meaning of Section 101(14) of the
Bankruptcy Code. Mr. Wiles has agreed to provide his services and
those of Acceleron at the rate of $450 per hour for Managing
Directors and $250 per hour for analysts. Additionally, Mr. Wiles
has requested that Debtor provide a $5,000 retainer, which
retainer will be applied upon the Court's approval of the
professional fees of Wiles.
About Ten Saints
Four related Las Vegas, Nevada-based entities sought Chapter 11
bankruptcy protection on July 13, 2011. The businesses are owned
or managed by local business people and firms, including Todd
Nigro, Nigro Development LLC, a Nigro family trust and other
investors.
Horizon Village Square LLC (Bankr. D. Nev. Case No. 11-21034) owns
the Vons-anchored Horizon Village Square Shopping Center near
I-515 and Horizon Drive in Henderson. The property includes five
retail buildings with nearly 43,000 square feet of space.
Ten Saints LLC (Bankr. D. Nev. Case No. 11-21028) owns the 134-
room Hampton Inn & Suites at St. Rose Parkway and Seven Hills
Drive in Henderson.
Beltway One Development Group LLC (Bankr. D. Nev. Case No. 11-
21026) owns the Desert Canyon Business Park at Russell Road and
the Las Vegas Beltway. It has two buildings and 15 acres.
Nigro HQ LLC (Bankr. D. Nev. Case No. 11-21014) owns an office
building at 9115 W. Russell Road occupied by Bank of George,
Infinity Plus LLC and Nigro Construction Inc.
Todd Nigro said the four bankruptcies were caused by threatened
foreclosures -- typically related to Wells Fargo Bank demanding
payments to keep loan-to-value ratios at specified levels.
Judge Mike K. Nakagawa presides over the cases. Lawyers at Gordon
Silver serve as the Debtors' bankruptcy counsel. The bankruptcy
petitions estimated assets and debts from $1 million to $10
million each for Nigro HQ; and from $10 million to $50 million in
both assets and debts for Horizon Village, Ten Saints and Beltway
One. The cases are not jointly administered.
A fifth related business, Russell Boulder LLC, filed for
bankruptcy (Bankr. D. Nev. Case No. 10-29724) on Oct. 19, 2010.
It owns the 600-suite Siena Suites extended stay property at
Boulder Highway and Russell Road.
Edward M. Zachary, Esq., at Bryan Cave LLP, in Bryan Cave LLP, in
Phoenix, Ariz., and Robert M. Charles, Jr., Esq., at Lewis and
Roca LLP, in Los Vegas, Nev., represent Wells Fargo Bank, N.A., as
counsel.
TRANS-LUX CORP: Gabelli Funds Discloses 47.1% Equity Stake
----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Gabelli Funds, LLC, and its affiliates
disclosed that, as of July 2, 2012, they beneficially own
14,095,300 shares of common stock of Trans-Lux Corporation
representing 47.15% of the shares outstanding. Gabelli Funds
previously reported beneficial ownership of 14,055,000 common
shares or a 75.21% equity stake as of Nov. 14, 2011. A copy of
the amended filing is available at http://is.gd/0GBNdv
About Trans-Lux Corporation
Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a
designer and manufacturer of digital signage display solutions for
the financial, sports and entertainment, gaming and leasing
markets.
The Company reported a net loss of $1.42 million in 2011, compared
with a net loss of $7.03 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$26.72 million in total assets, $24.45 million in total
liabilities, $6.13 million in redeemable convertible preferred
stock, and a $3.86 million total stockholders' deficit.
TRIUS THERAPEUTICS: To Sell $3.5-Mil. Common Shares to Terrapin
---------------------------------------------------------------
Trius Therapeutics, Inc., said it expects to settle with Terrapin
Opportunity, L.P., on the purchase of 612,133 shares of the
Company's common stock under the Purchase Agreement at an
aggregate purchase price of $3.5 million. The Company will
receive estimated net proceeds from the sale of these shares of
approximately $3.4 million after deducting the Company's estimated
offering expenses.
As reported by the TCR on Sept. 4, 2012, Trius has obtained a
committed equity financing facility under which it may sell up to
$25 million of its registered common stock to Terrapin over a
24-month period. Trius is not obligated to utilize any of the $25
million facility and remains free to enter into and consummate
other equity and debt financing transactions, subject to certain
restrictions.
About Trius Therapeutics
San Diego, Calif.-based Trius Therapeutics, Inc. (Nasdaq: TSRX) --
http://www.triusrx.com/-- is a biopharmaceutical company focused
on the discovery, development and commercialization of innovative
antibiotics for serious, life-threatening infections. The
Company's first product candidate, torezolid phosphate, is an IV
and orally administered second generation oxazolidinone being
developed for the treatment of serious gram-positive infections,
including those caused by MRSA. In addition to the company's
torezolid phosphate clinical program, it is currently conducting
two preclinical programs using its proprietary discovery platform
to develop antibiotics to treat infections caused by gram-negative
bacteria.
In the Form 10-K for the year ended Dec. 31, 2011, the Company
said it has incurred losses since its inception and it anticipates
that it will continue to incur losses for the foreseeable future.
As of Dec. 31, 2011, the Company had an accumulated deficit of
$95.4 million. The Company has funded, and plan to continue to
fund, its operations from the sale of securities, through research
funding and from collaboration and license payments, including
payments under the Bayer collaboration. However, the Company has
generated no revenues from product sales to date.
The Company reported a net loss of $18.25 million in 2011, a net
loss of $23.86 million in 2010, and a net loss of
$22.68 million in 2009.
The Company's balance sheet at June 30, 2012, showed $94.76
million in total assets, $16.56 million in total liabilities and
$78.20 million in total stockholders' equity.
VANITY EVENTS: Phil Ellett Named Chairman, CEO, CFO and Director
----------------------------------------------------------------
Lloyd Lapidus resigned as chairman, interim chief executive
officer and director of Vanity Events Holding, Inc., effective
Oct. 4, 2012. There was no disagreement or dispute between Mr.
Lapidus and the Company which led to his resignation.
On Oct. 9, 2012, the board of directors of the Company appointed
Phil Ellett to serve as chairman, chief executive officer, chief
financial officer and director of the Company. There is no
understanding or arrangement between Mr. Ellett and any other
person pursuant to which he was selected as an executive officer
or a director. Mr. Ellett does not have any family relationship
with any director, executive officer or person nominated or chosen
by us to become a director or an executive officer.
Since December 2010 Mr. Ellett has been an independent consultant
providing executive management services to a number of domestic
and international companies. From November 2009 until November
2010, Mr. Ellett was chief executive officer of Blackhawk
Healthcare, a hospital management company. From December 2006
through February 2009, Mr. Ellett was chief executive officer and
director of Innovative Software Technologies, Inc. (INIV), a
software services company. From 2002 to 2004, Mr. Ellett served
as president and CEO of Realvue, Inc. (f/k/a/ Soft Mountain), a
software developer. From 2001 to 2002, he served as Senior Vice
President of Sales at Motive Computing, a software developer. From
2000 to 2001, Mr. Ellett was an investor and served as President
and CEO of Netier, Inc. a manufacturer of thin client computers,
which was subsequently sold to Wyse, Inc. From 1996 to 2000, Mr.
Ellett held various positions with Ingram Micro, Inc., a computer
products distributor, serving as President of Europe for three
years and President of the Americas for the final year of his
tenure. Mr. Ellett received his Higher National Certificate in
Electrical and Electronic Engineering in 1977 from Slough College
of Technology in England. Mr. Ellet served as a director of
Biofina Group from September 2010 thru August 2011. Mr. Ellett
served as a director of Diatect International Corporation (DTCT)
from April 2008 thru November 2009.
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.
The Company reported net income of $330,705 in 2011 compared with
a net loss of $544,831 in 2010.
The Company's balance sheet at June 30, 2012, showed $3.29 million
in total assets, $17.97 million in total liabilities, all current,
and a $14.68 million total stockholders' deficit.
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 on Form 10-Q for the
period ended June 30, 2012, that its ability to implement its
current business plan and continue as a going concern ultimately
is dependent upon the Company's 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: To Liquidate in Chapter 7
-------------------------------------
Bloomberg's Businessweek reports that Vann's Inc. is seeking
conversion of its Chapter 11 bankruptcy case to a Chapter 7
liquidation sale. The report says the company's chief executive,
Jerry McConnell, noted Vann's requested a conversion to "orderly
liquidation" because it had "an obligation to let the judge know
that unless somebody is willing to put in $3 million to $5 million
for inventory," the company couldn't meet payroll.
The report notes the company tried to put itself up for sale but
no buyers emerged. The report says Vann's will remain open, or at
least will continue distributing paychecks, for the next two
months.
About Vann's Inc.
Vann's Inc. -- http://www.vanns.com/-- 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. 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.
Vann's Inc. 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.
Bankruptcy Judge John L. Peterson presides over the case. Vann's
hired Perkins Coie LLP's Alan D. Smith, Esq., and Brian A.
Jennings, Esq., as counsel; and Hamstreet & Associates, LLC, as
turnaround and restructuring advisors.
GE Commercial Distribution Finance Corporation is represented by
Gary Vincent, Esq., at Husch Blackwell LLP, and the Law Offices of
John P. Paul, PLLC. First Interstate Bank, the DIP Lender, is
represented by Benjamin P. Hursh, Esq., at Crowley Fleck PLLP.
The U.S. Trustee has formed a seven-member creditors committee.
The Committee is represented by Halperin Battagia Raicht, LLP, and
Ross Richardson.
The Court appointed Montana lawyer Richard J. Samson as Chapter 11
trustee.
VERENIUM CORP: Inks $10 Million Credit Agreement with Comerica
--------------------------------------------------------------
Verenium Corporation entered into a $10,000,000 revolving credit
facility with Comerica Bank. The Credit Line has a maturity date
of Oct. 5, 2014.
The Credit Line is pursuant to a Loan and Security Agreement with
Comerica which allows for revolving cash borrowings under a
secured credit facility of up to the lesser of (i) $10,000,000 or
(ii) 80% of certain eligible domestic accounts receivable held by
the Company that arise in the ordinary course of its business and
90% of eligible foreign accounts receivable held by the Company
that arise in the ordinary course of its business, in each case,
reduced by the aggregate face amount of any outstanding letters of
credit and the aggregate limits and credit card processing
reserves in respect of any corporate credit cards issued to the
Company. Advances under the Credit Line bears interest at a daily
adjusting London Interbank Offered Rate plus a margin of 4.75%.
This credit facility will allow the Company to borrow up to $8.4
million against eligible foreign and domestic receivables and will
cover an existing $1.6 million letter of credit commitment to the
Company's landlord. The credit facility also immediately frees up
$1.6 million in restricted cash which had previously secured the
letter of credit.
Subject to certain exceptions, all borrowings under the Credit
Line are secured by substantially all of the Company's assets,
excluding its intellectual property.
About Verenium Corp
San Diego, Calif.-based Verenium Corporation is an industrial
biotechnology company that develops and commercializes high
performance enzymes for a broad array of industrial processes to
enable higher productivity, lower costs, and improved
environmental outcomes. The Company operates in one business
segment with four main product lines: animal health and nutrition,
grain processing, oilfield services and other industrial
processes.
The Company's balance sheet at June 30, 2012, showed
$52.31 million in total assets, $13.83 million in total
liabilities, and shareholders' equity of $38.48 million.
Bankruptcy Warning
"Based on our current cash resources and 2012 operating plan, our
existing cash resources may not be sufficient to meet the cash
requirements to fund our planned operating expenses, capital
expenditures and working capital requirements beyond Dec. 31,
2012, without additional sources of cash. If we are unable to
raise additional capital, we will need to defer, reduce or
eliminate significant planned expenditures, restructure or
significantly curtail our operations, sell some or all our assets,
file for bankruptcy or cease operation," the Company said in its
quarterly report for the period ended June 30, 2012.
Going Concern
Ernst & Young LLP, in San Diego, California, expressed substantial
doubt about Verenium'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
incurred recurring operating losses, has a working capital deficit
of $637,000 and has an accumulated deficit of $600.8 million at
Dec. 31, 2011.
VERTIS HOLDINGS: Has Interim Approval of $150MM GECC DIP Loan
-------------------------------------------------------------
Vertis Holdings Inc. on Friday sought and obtained interim
Bankruptcy Court orders authorizing the Debtors to obtain
postpetition senior secured superpriority financing of up to
$150 million from a consortium of lenders led by General Electric
Capital Corporation as administrative agent and collateral agent,
and Wells Fargo Capital Finance LLC.
The Debtors said they have an immediate and critical need to
obtain postpetition financing under the DIP credit facility and to
use cash collateral to, among other things, expeditiously pursue a
value-maximizing sale of substantially all of their assets in
accordance with the timeline required by Quad/Graphics Inc., the
stalking horse buyer.
The Debtors will use a portion of the DIP loan funds to pay in
full, in cash, the outstanding balances of all advances and other
obligations under the Debtors' prepetition revolving credit
facility. As of the petition date, the Debtors owed roughly
$104.1 million under their prepetition revolving facility and
letters of credit facility with GE and Wells Fargo, including not
less than $88.3 million with respect to the revolving credit
advances. The repayment is a condition to closing the DIP
facility.
Vertis is also a borrower under a term loan facility with Morgan
Stanely Senior Funding Inc., the agent under the prepetition term
loan, and as term loan collateral agent, entered in December 2010.
As of the petition date, the Debtors owed $386.5 million in term
loans.
In a separate order issued on Friday, the Debtors also won interim
permission to use cash collateral from its prepetition term loan
lenders.
The Interim Cash Collateral Order provides that any of the
prepetition term loan lenders may credit bid on the Debtors'
assets.
GE Capital Markets Inc. serves as lead arrangr and book-running
manager; bank of America N.A. serves as co-lead arranger, co-book
running manager, and syndication agent; and Wells Fargo serves as
documentation agent.
The $150 million DIP facility includes a $25 million letter of
credit subfacility and a $25 million swing-line subfacility. The
facility matures on the earliest of Dec. 31, 2012, although Vertis
may extend the date not more than three times; or the effective
date of a confirmed Chapter 11 plan.
The Lenders' funding commitments are:
Lender Revolving Loan Commitment
------ -------------------------
General Electric Capital Corp. $94.28 million, including
$25 million as swing-line
commitment
Bank of America $30 million
Wells Fargo $25.17 million
There's a hearing on Nov. 1 to consider final approval of the DIP
facility and the use of cash collateral.
GE Capital, which serves as DIP Agent and Prepetition Agent, is
represented by:
Brian I. Swett, Esq.
WINSTON & STRAWN LLP
35 West Wacker Drive
Chicago, IL 60601
- and -
William D. Brewer, Esq.
WINSTON & STRAWN LLP
200 Park Avenue
New York, NY 10166
Morgan Stanely Senior Funding Inc., the agent under the
prepetition term loan, and as term loan collateral agent, is
represented by:
Eric Leicht, Esq.
Justin Wagstaff, Esq.
WHITE & CASE LLP
1155 Sixth Avenue
New York, NY 10036
- and -
Gerard Uzzi, Esq.
Anne Knight, Esq.
MILBANK TWEED HADLEY & McCLOY LLP
1 Chase Manhattan Plaza
New York, NY 10005
About Vertis
Vertis Holdings Inc. -- http://www.thefuturevertis.com/--
provides advertising services in a variety of print media,
including newspaper inserts such as magazines and supplements.
Vertis and its affiliates (Bankr. D. Del. Lead Case No. 12-12821),
returned to Chapter 11 bankruptcy on Oct. 10, 2012, this time to
sell the business to Quad/Graphics, Inc., for $258.5 million,
subject to higher and better offers in an auction.
As of Aug. 31, 2012, the Debtors' unaudited consolidated financial
statements reflected assets of approximately $837.8 million and
liabilities of approximately $814.0 million.
Bankruptcy Judge Christopher Sontchi presides over the 2012 case.
Vertis is advised by Perella Weinberg Partners, Alvarez & Marsal,
and Cadwalader, Wickersham & Taft LLP. Quad/Graphics is advised
by Blackstone Advisory Partners, Arnold & Porter LLP and Foley &
Lardner LLP, special counsel for antitrust advice. Kurtzman
Carson Consultants LLC is the Debtors' claims agent.
Quad/Graphics is a global provider of print and related
multichannel solutions for consumer magazines, special interest
publications, catalogs, retail inserts/circulars, direct mail,
books, directories, and commercial and specialty products,
including in-store signage. Headquartered in Sussex, Wis. (just
west of Milwaukee), the Company has approximately 22,000 full-time
equivalent employees working from more than 50 print-production
facilities as well as other support locations throughout North
America, Latin America and Europe.
Vertis first filed for bankruptcy (Bankr. D. Del. Case No.
08-11460) on July 15, 2008, to complete a merger with American
Color Graphics. ACG also commenced separate bankruptcy
proceedings. In August 2008, Vertis emerged from bankruptcy,
completing the merger.
Vertis against filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y.
Case No. 10-16170) on Nov. 17, 2010. The Debtor estimated its
assets and debts of more than $1 billion. Affiliates also filed
separate Chapter 11 petitions -- American Color Graphics, Inc.
(Bankr. S.D.N.Y. Case No. 10-16169), Vertis Holdings, Inc. (Bankr.
S.D.N.Y. Case No. 10-16170), Vertis, Inc. (Bankr. S.D.N.Y. Case
No. 10-16171), ACG Holdings, Inc. (Bankr. S.D.N.Y. Case No.
10-16172), Webcraft, LLC (Bankr. S.D.N.Y. Case No. 10-16173), and
Webcraft Chemicals, LLC (Bankr. S.D.N.Y. Case No. 10-16174). The
bankruptcy court approved the prepackaged Chapter 11 plan on
Dec. 16, 2010, and Vertis consummated the plan on Dec. 21. The
plan reduced Vertis' debt by more than $700 million or 60%.
VIASPACE INC: Delivers 80% of Outstanding Shares to Changs
----------------------------------------------------------
VIASPACE Green Energy Inc., previously reported it delivered
6,503,920 newly-issued shares of common stock of the Company to
Changs, LLC, under the Recapitalization Agreement entered into by
VIASPACE Inc., VIASPACE Green, Stephen Muzi, Carl Kukkonen, Sung
Chang and Changs, LLC.
The correct number of Company shares delivered to Changs, LLC, was
8,384,320 shares, or 80% of the outstanding common shares of the
VIASPACE Green.
About VIASPACE Inc.
Irvine, Calif.-based VIASPACE Inc. (OTC Bulletin Board: VSPC -
News) -- http://www.VIASPACE.com/-- is a clean energy company
providing products and technology for renewable and alternative
energy that reduce or eliminate dependence on fossil and high-
pollutant energy sources. Through its majority-owned subsidiary
VIASPACE Green Energy Inc., the Company grows Giant King Grass as
a low carbon fuel for electricity generating power plants and as a
feedstock for cellulosic biofuels.
Viaspace reported a net loss of $668,000 on $588,000 of total
revenues for the three months ended March 31, 2012. The Company
reported a net loss of $9.36 million in 2011, compared with a net
loss of $2.96 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$9.82 million in total assets, $7.32 million in total liabilities
and $2.50 million in total equity.
Going Concern
The Company has incurred significant losses from operations,
resulting in an accumulated deficit of $43,650,000. The Company
expects such losses to continue. In addition, the Company has
limited working capital and based on current cash flows does not
have sufficient funds to pay the May 14, 2012, installment due on
the note to Changs LLC. These raises substantial doubt about the
Company's ability to continue as a going concern.
After auditing the financial results for the year ended Dec. 31,
2011, Hein & Associates LLP, in Irvine, Calif., expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that he Company has
incurred significant losses from operations, resulting in an
accumulated deficit of $43.05 million. The Company expects those
losses to continue. In addition, the Company has limited working
capital and based on current cash flows does not have sufficient
funds to pay the May 2012 instalment due on the note to Changs
LLC.
WOLVERINE WORLD: S&P Assigns 'BB-' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services assigned Wolverine World Wide
Inc. its 'BB-' corporate credit rating. The outlook is stable.
"At the same time, we assigned Wolverine's $1.1 billion senior
secured credit facility our 'BB' issue-level rating (one notch
above the corporate credit rating) with a recovery rating of '2',
indicating our expectation for substantial (70% to 90%) recovery
for the lenders in the event of a payment default. We also
assigned Wolverine's $375 million unsecured notes due 2020 our
'B+' issue-level rating (one notch below the corporate credit
rating) with a recovery rating of '5', indicating our expectation
for modest (10% to 30%) recovery for lenders in the event of a
payment default," S&P said.
"Our ratings on Wolverine reflect our view that the company's
financial profile is 'aggressive' given the higher debt levels
following completion of the PLG acquisition resulting in pro forma
debt-to-EBITDA leverage in excess of 4.5x," said Standard & Poor's
credit analyst Linda Phelps.
"In addition, we believe the company's financial policy is
moderate, reflecting the company post transaction leverage in
conjunction with management's plans to reduce transaction-related
debt and that the company has operated with very modest debt
levels in recent years. Our ratings further reflect our view of
Wolverine's 'fair' business risk, underpinned by the group's
strong niche positions in the U.S. footwear market, and the
strength and growth potential of most of its brands. The business
risk assessment is constrained by our view of the fragmented and
competitive market in which Wolverine operates, as well as by its
limited geographic diversification and narrow product offering,"
S&P said.
"The company will have high debt levels after the transaction,
with pro forma adjusted debt leverage initially about 4.6x. We
believe this should gradually decline toward 4x within the next 12
to 18 months, while the ratio of funds from operations (FFO) to
debt should improve to the high teens. As such, we believe credit
measures are in line with indicative ratios for a financial risk
profile that we characterize to be aggressive. These credit
measures include debt-to-EBITDA leverage of 4x to 5x and FFO to
total debt of 12% to 20%," S&P said.
* BOND PRICING: For The Week From Oct. 8 to 12, 2012
----------------------------------------------------
Company Coupon Maturity Bid Price
------- ------ -------- ---------
A123 SYSTEMS INC 3.750 4/15/2016 33.000
AES EASTERN ENER 9.000 1/2/2017 2.000
AES EASTERN ENER 9.670 1/2/2029 9.500
AFFYMETRIX INC 3.500 1/15/2038 89.935
AGY HOLDING COR 11.000 11/15/2014 48.625
AHERN RENTALS 9.250 8/15/2013 59.750
ALION SCIENCE 10.250 2/1/2015 56.100
AMBAC INC 6.150 2/7/2087 5.150
ATP OIL & GAS 11.875 5/1/2015 21.125
ATP OIL & GAS 11.875 5/1/2015 21.375
ATP OIL & GAS 11.875 5/1/2015 21.125
BUFFALO THUNDER 9.375 12/15/2014 35.250
CALIF BAPTIST 7.100 4/1/2014 4.500
CAPMARK FINL GRP 6.300 5/10/2017 2.000
CHAMPION ENTERPR 2.750 11/1/2037 1.000
CTL-CALL10/12 8.000 10/1/2015 104.190
DIRECTBUY HLDG 12.000 2/1/2017 20.500
DIRECTBUY HLDG 12.000 2/1/2017 20.500
DOWNEY FINANCIAL 6.500 7/1/2014 58.125
EASTMAN KODAK CO 7.000 4/1/2017 11.250
EASTMAN KODAK CO 7.250 11/15/2013 11.800
EASTMAN KODAK CO 9.200 6/1/2021 8.750
EASTMAN KODAK CO 9.950 7/1/2018 23.354
EDISON MISSION 7.500 6/15/2013 50.465
ELEC DATA SYSTEM 3.875 7/15/2023 97.000
ENERGY CONVERS 3.000 6/15/2013 43.500
FIBERTOWER CORP 9.000 1/1/2016 30.000
GEOKINETICS HLDG 9.750 12/15/2014 43.000
GLB AVTN HLDG IN 14.000 8/15/2013 35.363
GLOBALSTAR INC 5.750 4/1/2028 48.750
GMX RESOURCES 4.500 5/1/2015 44.500
GMX RESOURCES 5.000 2/1/2013 90.500
HAWKER BEECHCRAF 8.500 4/1/2015 19.500
HAWKER BEECHCRAF 8.875 4/1/2015 19.500
HAWKER BEECHCRAF 9.750 4/1/2017 0.625
HOV-CALL11/12 10.625 10/15/2016 107.900
HUTCHINSON TECH 8.500 1/15/2026 55.425
ITWG-CALL11/12 9.750 4/15/2015 102.781
ITWG-CALL11/12 9.750 4/15/2015 102.781
KELLWOOD CO 7.625 10/15/2017 30.500
KV PHARM 12.000 3/15/2015 40.500
KV PHARMA 2.500 5/16/2033 4.500
KV PHARMA 2.500 5/16/2033 3.875
LEHMAN BROS HLDG 0.250 12/12/2013 19.750
LEHMAN BROS HLDG 0.250 1/26/2014 19.750
LEHMAN BROS HLDG 1.000 10/17/2013 19.750
LEHMAN BROS HLDG 1.000 3/29/2014 19.750
LEHMAN BROS HLDG 1.000 8/17/2014 19.750
LEHMAN BROS HLDG 1.000 8/17/2014 19.750
LEHMAN BROS HLDG 1.250 2/6/2014 19.750
LEHMAN BROS HLDG 1.500 3/29/2013 19.750
LEHMAN BROS INC 7.500 8/1/2026 14.500
LIFECARE HOLDING 9.250 8/15/2013 36.854
MANNKIND CORP 3.750 12/15/2013 61.540
MASHANTUCKET PEQ 8.500 11/15/2015 15.725
MASHANTUCKET PEQ 8.500 11/15/2015 9.250
MASHANTUCKET TRB 5.912 9/1/2021 9.250
MF GLOBAL LTD 9.000 6/20/2038 56.500
NEWPAGE CORP 10.000 5/1/2012 2.000
NEWPAGE CORP 11.375 12/31/2014 57.750
NGC CORP CAP TR 8.316 6/1/2027 13.000
PATRIOT COAL 3.250 5/31/2013 14.455
PENSON WORLDWIDE 8.000 6/1/2014 39.502
PLATINUM ENERGY 14.250 3/1/2015 40.000
PMI CAPITAL I 8.309 2/1/2027 1.125
PMI GROUP INC 6.000 9/15/2016 26.625
POWERWAVE TECH 3.875 10/1/2027 11.709
POWERWAVE TECH 3.875 10/1/2027 11.550
RESIDENTIAL CAP 6.500 4/17/2013 25.750
RESIDENTIAL CAP 6.875 6/30/2015 25.625
SCHOOL SPECIALTY 3.750 11/30/2026 58.500
TERRESTAR NETWOR 6.500 6/15/2014 10.000
TEXAS COMP/TCEH 10.250 11/1/2015 23.375
TEXAS COMP/TCEH 10.250 11/1/2015 23.875
TEXAS COMP/TCEH 10.250 11/1/2015 25.741
TEXAS COMP/TCEH 15.000 4/1/2021 37.750
TEXAS COMP/TCEH 15.000 4/1/2021 36.000
THQ INC 5.000 8/15/2014 58.500
TIMES MIRROR CO 7.250 3/1/2013 35.625
TRAVELPORT LLC 11.875 9/1/2016 36.000
TRAVELPORT LLC 11.875 9/1/2016 37.000
TRIBUNE CO 5.250 8/15/2015 34.150
USEC INC 3.000 10/1/2014 42.000
WCI COMMUNITIES 6.625 3/15/2015 0.375
*********
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, Carmel
Paderog, Meriam Fernandez, 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 ***