/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/121213.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, December 13, 2012, Vol. 16, No. 346 Headlines 11850 DEL PUEBLO: Hires Levi Reuben as General Counsel 11850 DEL PUEBLO: Court Approves Stipulation Over Use of Cash 440 PARTNERS: Voluntary Chapter 11 Case Summary ADVANCED MANUFACTURING: Case Summary & 20 Largest Unsec Creditors AHERN RENTAL: Stripped of Exclusivity; Bondholders Challenge Plan ALTERNATE FUELS: Jenkins Claims Declared as Equity Contributions AMERICAN AIRLINES: To Decide on Merger "Soon"; Open to P/E Funding AMERICAN AIRLINES: Pilots Accept New Labor Contract AMERICAN AIRLINES: Wins Approval of Sabre Settlement AMERICAN AIRLINES: USAIR Merger May Not Get Antitrust Objection AMERICAN SUZUKI: Files Schedules of Assets and Liabilities ANIXTER INT'L: Fitch Assigns 'BB-' Senior Unsecured Debt Rating ARAMARK CORP: Moody's Rates $670-Mil. Add-On Term Loan 'Ba3' ARAMARK CORP: S&P Keeps 'BB' Rating on $1.5 Billion Term Loan ARCAPITA BANK: Has Interim Approval for Fortress Financing ARCHDIOCESE OF MILWAUKEE: Parishes' Assets Out of Ch. 11 ARIZONA CHEMICAL: Moody's Maintains 'Ba3' Corporate Family Rating BAKERS FOOTWEAR: Files Schedules of Assets and Liabilities BAKERS FOOTWEAR: Can Hire GA Keen as Real Estate Consultant BAKERS FOOTWEAR: Court OKs Bryan Cave as Restructuring Counsel BAKERS FOOTWEAR: Alliance Management Approved as Fin'l Advisor BALLENGER CONSTRUCTION: Case Summary & 20 Largest Unsec Creditors BARLEN CONTRATING: Voluntary Chapter 11 Case Summary BOWLES SUB: Asks for Court OK to Hire Anton Economics as Economist BROOKDALE HOSPITAL: GA Keen Closes Sale of Apartment Buildings CAPITOL BANCORP: Hits Snag on Prepack Plan Confirmation CC HOLDINGS: S&P Gives 'BB' Rating on $1.5-Bil. Notes Issuances CHARLIE MCGLAMRY: Wants Plan Exclusivity Extended to March 2013 CHRYSLER LLC: Product Liability Class Suit Goes to SDNY Court CROWN CASTLE: Fitch Rates New $1.5BB Senior Unsecured Notes 'BB-' CROWN CASTLE: Moody's Affirms 'Ba2' Corporate Family Rating CYPRESS POINT: Voluntary Chapter 11 Case Summary DECODE GENETICS: Amgen to Acquire Business in $415 Million Deal DELTA AIR: Virgin Investment No Impact on Moody's 'B2' Rating DICKINSON THEATRES: Spirit Entitled to Attorneys' Fees EDUCATION MANAGEMENT: S&P Cuts CCR to 'B-' on Tighter Regulations ELDORADO GOLD: S&P Rates New $600MM Senior Unsecured Notes 'BB' EURAMAX INT'L: Moody's Cuts CFR/PDR to 'Caa2'; Outlook Stable FAIRWEST ENERGY: Obtains Initial Order Under CCAA FASTBUCKS HOLDING: Voluntary Chapter 11 Case Summary FL.INVEST: Case Summary & 7 Largest Unsecured Creditors FOUNTAIN PARK: Case Summary & 15 Largest Unsecured Creditors FRONTLINE TECHNOLOGIES: Commences Restructuring Under BIA GRAPHIC PACKAGING: S&P Affirms 'BB+' Corporate Credit Rating HAWAII MEDICAL: Hires Reid Collins as Litigation Counsel HOSTESS BRANDS: Wants Control of Liquidation Case Until May 2013 HOSTESS BRANDS: Lewis Brothers Hires Schiff Hardin as Lawyers HOSTESS BRANDS: Employees File Class Suit Over WARN Act Violations HOSTESS BRANDS: Taps Hilco Industrial et al., as Marketing Agents HOSTESS BRANDS: Hearing on Exclusivity Extension Set for Dec. 21 INSPIRATION BIOPHARMACEUTICALS: DIP Financing Hiked to $4.8-Mil INSPIRATION BIOPHARMACEUTICALS: Can Employ FTI's Michael Nowlan INSPIRATION BIOPHARMACEUTICALS: THG OK'd as Committee's Advisor INSPIRATION BIOPHARMACEUTICALS: Severance Plan and KEIP Okayed INSPIRATION BIOPHARMACEUTICALS: Files Schedules of Assets & Debts INSPIRATION BIOPHARMACEUTICALS: Hearing on Cash Use Friday INTERNATIONAL LEASE: AIG Deal Cues Fitch to Affirm 'BB' IDR JESUP HOSPITALITY: Case Summary & 6 Unsecured Creditors K-V PHARMACEUTICAL: Secures Commitment for $85 Million Loan LAKEWOOD ENGINEERING: Supreme Court Won't Hear Trademark Dispute LAVEN HOSPITALITY: Case Summary & 6 Largest Unsecured Creditors LBI MEDIA: S&P Ups CCR to 'CC' on Discount Note Interest Payment LCI HOLDING: Case Summary & 30 Largest Unsecured Creditors LEHI ROLLER: Files Bankruptcy in Salt Lake City LEHMAN BROTHERS: Court Approves A&M's $42 Million Bonus LIFECARE HOLDINGS: Moody's Cuts PDR to 'D' After Ch. 11 Filing LIN TELEVISION: Moody's Assigns 'Ba2' CFR; Rates Revolver 'Ba2' LOS ANGELES DODGERS: Payroll More Than Doubled LRM MANAGEMENT: Case Summary & Largest Unsecured Creditor MEDFORD VILLAGE EAST: Ordered to Pay $6.4MM to Lennar METRO ANESTHESIA: Case Summary & 5 Unsecured Creditors MONITOR CO: Wins Final Approval of $15-Mil. Financing NATIONAL POOL: NJ Bankr. Court Admits Error in Dismissing Lawsuit NETFLIX INC: Moody's Cuts CFR/PDR to 'Ba3'; Outlook Stable NEW YORK TIMES: S&P Raises Senior Notes Rating to 'BB-' NEWPORT TELEVISION: S&P Withdraws 'B-' Corporate Credit Rating OCEAN BREEZE: Cash Collateral Use OK'd; Hearing Set for Dec. 19 OCEAN BREEZE: Taps Ross Earle for State Law Litigation Issues ORCHARD SUPPLY: S&P Lowers CCR to 'CCC' on Covenant Risk OVERSEAS SHIPHOLDING: Greylock Partners to Lead Reorganization PARAGON SHIPPING: Obtains Waivers From Four Lenders PEAK RESORTS: Plan Filing Exclusivity Extended to March 29 PEMCO WORLD: Court Extends Plan Exclusivity to Jan. 4 PERRY ELLIS: Moody's Says Dividend Modestly Neg. for Liquidity PHOENIX COMPANIES: Indenture Changes Cues Fitch to Put 'B' IDR PLAY BEVERAGES: Sues Playboy for Breach of 2006 License Agreement PMI GROUP: Exclusive Filing Period Extended to Jan. 3, 2013 PRECISION AIRMOTIVE: Case Summary & 20 Largest Unsecured Creditors PROTECTIVE LIFE: Fitch Affirms 'BB+' Trust Preferred Ratings QUIGLEY CO: Pfizer Hoping for Supreme Court Appeal on Protection QUINTILES TRANSNATIONAL: S&P Affirms 'BB-' Corporate Credit Rating RANCHO CALIFORNIA: Voluntary Chapter 11 Case Summary RENAISSANCE LEARNING: Moody's Corrects Oct. 19 Rating Release RESERVES RESORT: Case Summary & 12 Unsecured Creditors RESIDENTIAL CAPITAL: Proposes Mediator for Plan Negotiations RESIDENTIAL CAPITAL: Wants Until Feb. 28 to File Plan RESIDENTIAL CAPITAL: Wants Removal Period Extended Until April 9 RG STEEL: Hackman Capital Confirms Purchase of Former Plant RIDGE PARK OFFICE: Chapter 11 Case Dismissed RIDGE VIEW FARM: Lenders Win Dismissal of Chapter 11 Case RIDGELAND APARTMENT: Case Summary & 2 Unsecured Creditors SAN BERNARDINO, CA: Calpers Win Would Rewrite Chapter 9 Rules SIGNATURE STATION: Files Schedules of Assets and Liabilities SILICON VALLEY: Case Summary & 20 Largest Unsecured Creditors SLD PROPERTIES: Case Summary & 12 Largest Unsecured Creditors SPECTRUM BRANDS: S&P Affirms 'B' Corp. Credit Rating; Outlook Pos STOCKTON, CA: Calpers Win Would Rewrite Chapter 9 Rules TAYLOR BEAN: D.C. Court Permits BofA to Proceed Against FDIC TC GLOBAL: Baristas to Compete at Jan. 3 Auction TNS INC: S&P Puts 'BB-' CCR on Watch Neg over Sirius Deal TOBACCO SETTLEMENT AUTH: Moody's Ups Rating on 2005A Bonds to Ba1 TONY TEIXEIRA: Case Summary & 11 Largest Unsecured Creditors TORCH ENERGY: Receives Continued Listing Standards from NYSE TORM A/S: Regains Compliance With NASDAQ Listing Rules TRAINOR GLASS: Can Hire Cole Martin to Render Auditing Services TRAINOR GLASS: Exclusive Plan Filing Period Extended to Jan. 8 TRIBUNE CO: Calif. Newspaper Owners May Buy Assets TRIBUNE CO: Said to Be Hiring Bankers to Sell Newspaper Assets UPPER DECK: Dutch Insolvency Proceeding Recognized in U.S. Courts VERTIS HOLDINGS: Direct Fee Review Appointed as Fee Examiner VILLAGE GREEN: Artificial Impairment of Claims Discussed in Case VISTEON CORP: Moody's Affirms 'B1' CFR/PDR; Outlook Stable VOICES OF FAITH: Court OKs Oracle Real Estate as Appraiser WATERFRONT OFFICE: Five Mile's 2 Stamford Buildings in Chapter 11 WATERSCAPE RESORT: Court Rules on Pavarini's Summary Judgment Bid * Moody's Says U.S. Telecom Sector Faces Dividend Dilemma * Moody's Says Distressed Transactions Hit CBD Office Prices * Moody's Says High-Yield Bond Covenant Quality Hits Record Low * Moody's Says Pension Funding Bonds Bring Risks to Government * Supreme Court Refuses to Hear Trademark Rejection Case * Right to Appeal Is Estate Property and May Be Sold * Recent Small-Dollar & Individual Chapter 11 Filings ********* 11850 DEL PUEBLO: Hires Levi Reuben as General Counsel ------------------------------------------------------ 11850 Del Pueblo, LLC asks the U.S. Bankruptcy Court for permission to employ Levi Reuben UKu, Esq. as general counsel pursuant to 11 U.S.C. Sec. 327. The firm will help the Debtor prepare and attain confirmation of a plan of reorganization. The firm will also assist the Debtor to negotiate a sale or recapitalization of its assets. Levi Reuben attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm's hourly rates are: Professional Rate ------------ ---- Partner $400 Associate $325 Paralegal $225 11850 Del Pueblo, LLC, first filed a Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-42819) in Los Angeles on Sept. 27, 2012. The Debtor, a Single Asset Real Estate under 11 Sec. 101(51B), owns property on 11850 Valley Boulevard, in El Monte, California. The property, according to the schedules filed together with the petition, is worth $9 million and secures a $17.5 million claim. The Law Offices of Levi Reuben Uku serves as counsel to the Debtor. The Court dismissed the bankruptcy case on Oct. 12, 2012, due to the Debtor's failure to timely file certain necessary documents. The Debtor filed a second petition (Bankr. C.D. Calif. 12-44726) on Oct. 15. Bankruptcy Judge Robert N. Kwan presides over the case. The Debtor is represented in the second case by: Chukwudum N. Emenike, Esq. 3255 Wilshire Blvd Ste 1032 Los Angeles, CA 90011 Tel: 213-487-0190 Fax: 213-487-7415 E-mail: chuckeme@yahoo.com - and - Levi Reuben Uku, Esq. LAW OFFICES OF LEVI REUBEN UKU 3540 Wilshire Blvd Ste 626 Los Angeles, CA 90010 Tel: 213-385-0193 Fax: 213-385-0576 E-mail: levireuben@gmail.com U.S. Bank National Association, as Trustee, successor-in-interest to Bank of America, N.A., as Trustee, as successor by merger to LaSalle Bank National Association, as Trustee, for the Registered Holders of Deutsche Mortgage & Asset Receiving Corporation Mortgage Pass-Through Certificates, Series CD2006-CD3, is represented by Alan M. Feld, Esq., M. Reed Mercado, Esq., and Adam McNeile, Esq., at Sheppard, Mullin, Richter & Hampton LLP. 11850 DEL PUEBLO: Court Approves Stipulation Over Use of Cash ------------------------------------------------------------- The Bankruptcy Court approved a stipulation between 11850 Del Pueblo, LLC, and U.S. Bank National Association over the use of cash collateral. U.S. Bank provided a $14 million prepetition loan secured by the Debtor's assets. Prior to the bankruptcy filing, U.S. Bank sought and obtained appointment of a receiver in California state court. The stipulation approved by the bankruptcy judge provides that the hearing is deferred to Jan. 22, 2013, with respect to (i) the lender's motion for an order excusing compliance with 11 U.S.C. Sec. 543, and excusing the receiver from turning over estate property to the Debtor and (ii) the Debtor's request to impose and continuing the automatic stay. The stipulation provides that the receiver of the Debtor's assets is excused from compliance requirements on an interim basis. As agreed by the parties, the receiver may continue to operate the Debtor's property, including its rents and profits, and use cash collateral. The receiver may only use cash collateral in accordance with a budget. About 11850 Del Pueblo 11850 Del Pueblo, LLC, first filed a Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-42819) in Los Angeles on Sept. 27, 2012. The Debtor, a Single Asset Real Estate under 11 Sec. 101(51B), owns property on 11850 Valley Boulevard, in El Monte, California. The property, according to the schedules filed together with the petition, is worth $9 million and secures a $17.5 million claim. The Law Offices of Levi Reuben Uku serves as counsel to the Debtor. The Court dismissed the bankruptcy case on Oct. 12, 2012, due to the Debtor's failure to timely file certain necessary documents. The Debtor filed a second petition (Bankr. C.D. Calif. 12-44726) on Oct. 15. Bankruptcy Judge Robert N. Kwan presides over the case. The Debtor is represented in the second case by Chukwudum N. Emenike, Esq.; and the Law Offices of Levi Reuben Uku. U.S. Bank National Association, as Trustee, successor-in-interest to Bank of America, N.A., as Trustee, as successor by merger to LaSalle Bank National Association, as Trustee, for the Registered Holders of Deutsche Mortgage & Asset Receiving Corporation Mortgage Pass-Through Certificates, Series CD2006-CD3, is represented by: Alan M. Feld, Esq. M. Reed Mercado, Esq. Adam McNeile, Esq. SHEPPARD, MULLIN, RICHTER & HAMPTON LLP 333 South Hope Street, 43rd Floor Los Angeles, CA 90071-1422 Tel: (213) 620-1780 Fax: (213) 620-1398 E-mail: afeld@sheppardmullin.com rmercado@sheppardmullin.com 440 PARTNERS: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: 440 Partners, LLC 1717 W. Hayden Avenue Hayden, ID 83835 Bankruptcy Case No.: 12-21364 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court District of Idaho (Coeur dAlene) Judge: Terry L. Myers Debtor's Counsel: Pro se Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. The petition was signed by Kelly A. Enders, managing member. ADVANCED MANUFACTURING: Case Summary & 20 Largest Unsec Creditors ----------------------------------------------------------------- Debtor: Advanced Manufacturing & Power Systems, Inc. 1965 Bennett Drive Deland, FL 32724 Bankruptcy Case No.: 12-16507 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Samuel R. Pennington, Esq. 303 N Texas Avenue Tavares, FL 32778 Tel: (352) 508-8277 Fax: (352) 508-8277 E-mail: spennington@lawteam4u.com Scheduled Assets: $1,312,846 Scheduled Liabilities: $2,717,602 A copy of the Company's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/flmb12-16507.pdf The petition was signed by Randy Weimer, vice president. AHERN RENTAL: Stripped of Exclusivity; Bondholders Challenge Plan ----------------------------------------------------------------- Tim O'Reiley, writing for Las Vegas Review-Journal, reports that Bankruptcy Judge Bruce Beesley has ended Ahern Rental Inc.'s exclusivity periods, allowing other parties, including its creditors, to submit a reorganization plan for the Company. Judge Beesley said he saw no progress in resolving flashpoints between the company and its creditors. The Review-Journal relates that, at Friday's hearing in Reno, Nevada, Judge Beesley asked how quickly an attorney for one set of creditors could file their own plan so that he could put that plan and Ahern's versions on a tandem track to approval. Although New York attorney Daniel Connolly did not talk about what the plan might include, creditors have consistently stressed the need for Company CEO Don Ahern to at least surrender a substantial portion of his 97% ownership as part of a repayment package. The report notes at least one other firm with no stake in the case has talked about submitting a bid without making a commitment. The report relates Ahern attorney Gregg Galardi, Esq., indicated he would appeal Judge Beesley's ruling, but the judge refused to halt the rest of the case and wait for the outcome. The report notes calls seeking comment from Ahern executives were not returned Friday. The Review-Journal notes that, in terminating exclusivity, Judge Beesley cited a promise Ahern made during the summer to install new software that could generate accurate financial projections for its plan, a system that still has numerous bugs, and inability to negotiate any deal with creditors. The settlement attempt included a three-day mediation session in September overseen by another bankruptcy judge. "(Ahern) has probably had enough time to try to negotiate a plan and develop adequate information" through the new software, Judge Beesley said, according to the report. "I don't think good faith progress is being made on a plan." On Nov. 30, Ahern filed a bankruptcy-exit plan and disclosure statement. The plan lists $379.2 million in debt held by major lenders plus much smaller amounts held by others. According to the report, Judge Beesley said he does not think Ahern's plan offers full repayment -- known as present value -- so the owners cannot hang on to their entire positions under bankruptcy law. The Review-Journal relates Mr. Galardi argued unsuccessfully that the any determination that the plan fell short of legal standards was premature and likely wrong. Prior to last Friday's hearing, Ahern's Majority Term Lenders consisting of Goldman Sachs Palmetto State Credit Fund, L.P. and Liberty Harbor Master Fund I, L.P., said in court papers the Debtor's Plan is doomed to fail. They noted that the Debtor has rebuffed any effort to engage in a dialogue premised upon deleveraging its existing $600 million prepetition capital structure and instead proposes to leave entirely unimpaired the Debtor's equity interests, including those held by Donald F. Ahern, the 97% shareholder who controls and manages the Debtor's affairs, while significantly impairing or cramming-down the prepetition first lien Term Loan Claims and virtually every other class of prepetition claims, whether secured or unsecured. The Term Lenders said the Plan offers the non-palatable option of receiving a substantial 20% discount on what the Debtor previously and repeatedly has acknowledged are oversecured Term Loan Claims, sitting in priority ahead of roughly $270 million in secured and unsecured debt, or, alternatively, having a non-consensual treatment imposed on the Term Loan Claims through the issuance of new Senior Secured Notes that, despite the demonstrable existence of an efficient market for the Term Loan, would bear interest at a substantially below-market rate and fail to deliver the present market value of its fully secured claim. Over 90% of the holders of Ahern's second lien notes also filed papers prior to last Friday's hearing saying the Debtor's Plan would need to be "crammed down" on the Noteholders, who intend to vote "no." The Second Lien Noteholders said the Plan will likely need to be crammed down on multiple classes because the Plan proposes to impair virtually every class except for existing equity interests. The Plan offers the Second Lien Noteholders (1) a $0.50 cash out offer or (2) an $18.5 million note bearing interest at 6% due in 7 years, and an unsecured deficiency claim of $249.2 million. The deficiency claim inexplicably is classified separately from other general unsecured creditors and is offered a 7-year "plan payment obligation" accruing interest at 2%, with no cash payments for 5 years, and then cash interest payments for only 2 years. In contrast, the general unsecured claims are offered a two-year payout without interest and a waiver of avoidance actions if the Plan is accepted, or an amortizing five-year note at 2% interest if the Plan is not accepted. As to interest rates, the Plan offers Senior Secured Notes 4.25%, Junior Secured Notes 6%,0 while the most risky unsecured claims are offered only 2%. Equity, however, rides through unscathed and retains its full interests. The Second Lien Noteholders contended that, if prepetition shareholders are to retain any of their interests, the absolute priority rule demands that the plan of reorganization must either (a) pay unsecured creditors in full or (b) existing equity must contribute "substantial" new value to the debtor. The Second Lien Noteholders noted that Ahern values its business at as much as $790 million with "equity value" of roughly $180 million. Assuming the Debtor's valuation is correct, the Debtor should be able to access the capital markets to refinance the Second Lien Notes and exit bankruptcy. Under these circumstances, the Second Lien Noteholders continued, the Court's observation that the Debtor should pay its unsecured creditors in full, in cash, is entirely appropriate and justifiable. If the Debtor has the ability to pay its unsecured creditors in full in cash, the absolute priority rule demands that they do so if equity is to remain unimpaired. The Noteholders seriously dispute the accuracy of the Debtor's valuation. Put simply, if the Debtor's valuation is correct, it would not have to use chapter 11 to coerce a new 7-year loan from its existing creditors. The Second Lien Noteholders also noted that, if a full cash payment is not feasible, the Debtor can comply with the absolute priority rule only if the plan provides unsecured creditors with property clearly worth 100 cents in cash today. If the plan proposes to distribute new debt obligations/securities, the new debt must provide existing creditors with a present value equal to receiving 100 cents in cash today. The Majority Term Lenders, consisting of certain investment funds managed by Goldman Sachs Asset Management, L.P., including Liberty Harbor Master Fund I, L.P. and Goldman Sachs Palmetto State Credit Fund, L.P., are represented in the case by Robert Jay Moore, Esq. Haig M. Maghakian, Esq. MILBANK, TWEED, HADLEY & McCLOY LLP 601 South Figueroa Street, 30th Floor Los Angeles, CA 90017 - and - Kaaran Thomas, Esq. MCDONALD CARANO WILSON LLP 100 W. Liberty Street, 10th Floor Reno, NV 89501 Tel: 775-788-2000 Fax: 775-788-2020 E-mail: kthomas@mcdonaldcarano.com Sphere Capital, LLC - Series B, a Second Lien Noteholder, is represented by: Robert M. Charles, Jr., Esq. Laury M. Macauley, Esq. LEWIS AND ROCA LLP 50 W. Liberty Street, Ste. 410 Reno, NV 89501 Telephone: (775) 823-2900 Facsimile: (775) 823-2929 E-mail: rcharles@lrlaw.com lmacauley@lrlaw.com - and - Paul V. Shalhoub, Esq. Joseph G. Minias, Esq. Mary K. Warren, Esq. WILLKIE FARR & GALLAGHER LLP 787 Seventh Avenue New York, NY 10019-6099 Telephone: (212) 728-8000 Facsimile: (212) 728-8111 E-mail: pshalhoub@willkie.com jminias@willkie.com mwarren@willkie.com A group of Second Lien Noteholders are represented by: Laurel E. Davis, Esq. FENNEMORE CRAIG JONES VARGAS 300 South Fourth Street, Suite 1400 Las Vegas, NV 89101 Telephone: (702) 692-8000 E-mail: ldavis@cflaw.com - and - Kurt A. Mayr, Esq. BRACEWELL & GIULIANI LLP Goodwin Square 225 Asylum Street, Suite 2600 Hartford, CT 06103 Telephone: (860) 947-9000 Facsimile: (860) 246-3201 Email: kurt.mayr@bgllp.com - and - Daniel S. Connolly, Esq. BRACEWELL & GIULIANI LLP 1251 Avenue of the Americas, 49th Fl. New York, NY 10020 Telephone: (212) 508-6100 Facsimile: (212) 508-6101 Email: daniel.connolly@bgllp.com About Ahern Rentals Founded in 1953 with one location in Las Vegas, Nevada, Ahern Rentals Inc. -- http://www.ahern.com/-- now offers rental equipment to customers through its 74 locations in Arizona, Arkansas, California, Colorado, Georgia, Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia and Washington. Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D. Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain an extension of the Aug. 21, 2011 maturity of its revolving credit facility. In its schedules, the Debtor disclosed $485.8 million in assets and $649.9 million in liabilities. Judge Bruce T. Beesley presides over the case. Lawyers at Gordon Silver serve as the Debtor's counsel. The Debtor's financial advisors are Oppenheimer & Co. and The Seaport Group. Kurtzman Carson Consultants LLC serves as claims and notice agent. The Official Committee of Unsecured Creditors has tapped Covington & Burling LLP as counsel, Downey Brand LLP as local counsel, and FTI Consulting as financial advisor. Counsel to Bank of America, as the DIP Agent and First Lien Agent, are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer. Attorneys for the Majority Term Lenders are Paul Aronzon, Esq., and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Counsel for the Majority Second Lienholder are Paul V. Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq., at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E. Siegel, Esq., at Dechert LLP argue for certain revolving lenders. Attorneys for U.S. Bank National Association, as successor to Wells Fargo Bank, as collateral agent and trustee for the benefit of holders of the 9-1/4% Senior Secured Notes Due 2013 under the Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard, Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland & Hart. ALTERNATE FUELS: Jenkins Claims Declared as Equity Contributions ---------------------------------------------------------------- Christopher J. Redmond, the Chapter 11 Trustee appointed in the 2009 bankruptcy of Alternate Fuels, Inc., succeeded in convincing the bankruptcy judge to recharacterize claims filed by AFI's owners as equity contributions. Bankruptcy Judge Dale L. Somers ruled Monday the claims filed by William Karl Jenkins and M. Earlene Jenkins: -- for $3,823,862 for payment of three promissory notes, plus interest, is disallowed since the transfers alleged to be consideration for the Notes should be recharacterized as equity contributions; -- for $487,298.62 for "money" related to reclamation and accounts for Dan Card and Pat Miller is disallowed since the transfers alleged to be consideration for the claim should be recharacterized as equity contributions; and -- to $3 million of the proceeds of a lawsuit -- filed by AFI and Larry Pommier against Tom Cabanas and Richard Hall, officers and employees of the Missouri Department of Natural Resources (W.D. Mo. Case No. 4:02-cv-01182), alleging tortious interference with AFI's business with Midwest Coal -- allegedly assigned as security for the claims is set aside since the Jenkinses do not hold an allowed claim which the assignment secures. The Court said the Jenkinses have not sustained their burden of proof as to the validity and amount of their claims. Judge Somers also held that, if the claims were proven and not recharacterized as equity, the Jenkinses are the holders of unsubordinated, unsecured claims for the amount of the transfers, but the alleged assignment of the $3 million of the proceeds of the Cabanas Lawsuit as security for those claims would be subordinated and set aside and transferred to the estate. On Dec. 6, 1999, the Jenkinses entered into an agreement to purchase AFI from John Warmack for $549,250. The Jenkinses purchased all of the stock of AFI and 99% of the ownership of Cimarron Energy Company, LLC. The lawsuit is, CHRISTOPHER J. REDMOND, Trustee, Plaintiff, v. WILLIAM KARL JENKINS, M. EARLENE JENKINS, and CIMARRON ENERGY COMPANY, LLC, Defendants, Adv. Proc. No. 11-6026 (Bankr. D. Kan.). A copy of Judge Somer's Dec. 10, 2012 Memorandum Opinion and Order is available at http://is.gd/sS2ZvRfrom Leagle.com. Alternate Fuels, Inc., based in Pittsburg, Kansas, engages in surface coal mining. It filed a Chapter 11 petition (Bankr. D. Kan. Case No. 09-20173) on Jan. 28, 2009. Gary H. Hanson, Esq., at Stumbo Hanson, LLP, in Topeka, served as bankruptcy counsel. In its petition, the Debtor disclosed $4,910,807 in assets and $10,969,807 in debts. Christopher J. Redmond was later appointed as Chapter 11 Trustee for AFI. The Trustee has undertaken completion of the reclamation of the AFI mine sites. AFI first filed for Chapter 11 bankruptcy (Bankr. D. Kan. Case No. 92-42236) on Dec. 9, 1992. When the 1992 case was filed, AFI was winding up its coal mining operations in Kansas and transitioning to operations known as the "Blue Mound Mine," located in Barton and Vernon Counties, Missouri, under mining permits granted to AFI on leased properties. In AFI's First Bankruptcy Case, Kevin Checkett was appointed Chapter 11 Trustee with authority to operate the Debtor's business under the terms of a confirmed Chapter 11 plan. The First Bankruptcy Case was closed on Sept. 14, 1995. Mr. Checkett briefly continued to operate AFI under the terms of the confirmed plan, but in 1996, AFI ceased operations, abandoned the assets of AFI to various creditors, and Mr. Checkett resigned as trustee. John Warmack acquired all of the stock of AFI, provided certain new reclamation bonds and replacement reclamation bonds, and took over the operations and control of AFI. He later sold his stake to William Karl Jenkins in 1999. AMERICAN AIRLINES: To Decide on Merger "Soon"; Open to P/E Funding ------------------------------------------------------------------ Chief Executive Officer Tom Horton said American Airlines Inc.'s parent AMR Corp. will decide "soon" whether to merge with US Airways Group Inc. or try to emerge from bankruptcy as an independent carrier, according to a December 11 report by The Wall Street Journal. Mr. Horton refused to set a specific timetable for the decision but said the company is close to completing its evaluation of whether to stay independent or merge with US Airways. As for who will run a reorganized company, Mr. Horton said no decisions have been made yet on a new board. He declined to comment on whether any steps had been taken to recruit directors, according to a report by Bloomberg News. "There will come a moment when the governance of the new company is discussed," Bloomberg quoted Mr. Horton as saying. He said the directors probably would be a mix of holdovers and new members, as is "customary in a restructuring." US Airways has been pursuing a merger with the airline since shortly after the latter filed for bankruptcy protection. Last month, US Airways sent an all-stock merger proposal to American Airlines suggesting that the airline's creditors own 70% of the combined company and US Airways' shareholders own 30% of that company, the Journal reported. US Airways also negotiated tentative labor contracts with American Airlines' unions on how they would be treated in a merger to get their support for a deal. The airline's three big unions are backing the merger and have already agreed to conditional contract terms should the merger proceed. Depending on how discussions progress, a combined company could be valued at more than $8 billion. Discussions are expected to continue into next year, the Journal reported, citing people familiar with the talks as its source. AMR Open to Funding Exit with Private Equity Aside from leadership and choosing from options including a merger and a go-it-alone approach, financing is also an unresolved question facing AMR. Mr. Horton said AMR is open to the possibility of helping pay for the bankruptcy exit with private equity or other outside funding, Bloomberg News reported. "The capital structure of the new American has yet to be determined," along with whether it will need a private-equity partner, Mr. Horton said. Bloomberg noted that investor optimism about a merger has helped fuel a rally in AMR debt. The $460 million of 6.25% convertible notes due October 2014 rose 1.5% on Dec. 10 to 80.19 cents on the dollar, the highest price this year, Bloomberg said, citing Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The notes traded at 17.75 cents after AMR's filing, Bloomberg pointed out. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Pilots Accept New Labor Contract --------------------------------------------------- American Airlines Inc.'s pilots approved a new labor contract that could help reduce the company's labor costs. Bloomberg News reported that 74% of the pilots who voted approved the contract. The six-year contract will give pilots a 13.5% stake in the post-bankruptcy company and annual pay raises while freezing their pension and requiring longer work hours. Meanwhile, American Airlines can save as much as $315 million annually under the deal, according to court papers. A copy of the labor agreement can be accessed at http://is.gd/ABWW6i American Airlines said the new contract responds to the priorities of the pilots' union, Allied Pilots Association, which last agreed on a contract in 2003. "Ratification gives us the certainty we need for American to successfully restructure, providing opportunity and growth for all of our people and stakeholders," Bloomberg News quoted Denise Lynn, the company's senior vice president-people, as saying. In August, pilots rejected an offer from American Airlines, which responded by cutting pay and benefits. This was followed by a surge in delayed and canceled flights that the company blamed on an illegal work slowdown by pilots. The new contract also gives a possible boost to US Airways Group Inc.'s effort for a merger. "Ratification helps ease the way towards a potential merger," Bloomberg News quoted Jamie Baker, a JPMorgan Chase & Co. analyst in New York, as saying in a note to investors. "A failure to ratify would have essentially stopped the clock, in our view, further dragging out an already complex process," he said. Dennis Tajer, an APA spokesman, said the ratified agreement "should not in any way be viewed as support for the American stand-alone plan or for this current management team." "We continue to support an American-US Airways merger as the best way to strengthen our airline," Bloomberg News quoted Mr. Tajer as saying. Separately, American Airlines filed a motion asking Judge Sean Lane of the U.S. Bankruptcy Court for the Southern District of New York to approve the new contract with pilots. A court hearing to consider approval of the motion is scheduled for December 19. Objections are due by December 17. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: Wins Approval of Sabre Settlement ---------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized American Airlines Inc. to settle litigation with Sabre Holdings Inc. Sabre faces two lawsuits in Texas filed by American Airlines early last year for allegedly trying to crush competition from its former parent. Created by American Airlines in 1960 and spun off in 2000, Sabre was accused of violating antitrust laws to impede the development of its former parent's own distribution technology to reach travel agencies and customers. Under the settlement, American Airlines will renew its current distribution contract with Sabre and will receive cash payments. Both sides also agreed to release each other from all claims asserted in the lawsuits. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN AIRLINES: USAIR Merger May Not Get Antitrust Objection --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that AMR Corp. Chief Executive Officer Tom Horton said in an interview that AMR is almost ready to file a bankruptcy reorganization plan and is near the point of deciding whether to remain independent or merge with US Airways Group Inc. Federal antitrust regulators aren't likely to block an AMRUS Airways merger "wholesale," according to Ankur Kapoor, an antitrust lawyer with Constantine Cannon LLP in New York. The two airlines' networks are "largely complementary" and there are no overlaps between hubs, Mr. Kapoor said in an interview. "If there happen to be city pairs that would result in less than three competitors, the Department of Justice may require divestiture in that market," Mr. Kapoor said. American Airlines AMR Corp. and its subsidiaries including American Airlines, the third largest airline in the United States, filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost-cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so-called U.S. legacy airlines to seek court protection from creditors. American Airlines, American Eagle and the AmericanConnection carrier serve 260 airports in more than 50 countries and territories with, on average, more than 3,300 daily flights. The combined network fleet numbers more than 900 aircraft. The Company reported a net loss of $884 million on $18.02 billion of total operating revenues for the nine months ended Sept. 30, 2011. AMR recorded a net loss of $471 million in the year 2010, a net loss of $1.5 billion in 2009, and a net loss of $2.1 billion in 2008. AMR's balance sheet at Sept. 30, 2011, showed $24.72 billion in total assets, $29.55 billion in total liabilities, and a $4.83 billion stockholders' deficit. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by AMR Corp. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). AMERICAN SUZUKI: Files Schedules of Assets and Liabilities ---------------------------------------------------------- American Suzuki Motor Corporation filed with U.S. Bankruptcy Court for the Central District of California its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $20,156,365 B. Personal Property $212,782,871 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $149,556,317 E. Creditors Holding Unsecured Priority Claims $48,131 F. Creditors Holding Unsecured Non-priority Claims $63,758,006 ----------- ----------- TOTAL $232,939,236 $213,362,454 A copy of the schedules is available for free at http://bankrupt.com/misc/AMERICAN_SUZUKI_sal.pdf About American Suzuki Established in 1986, American Suzuki Motor Corporation is the sole distributor of Suzuki automobiles and vehicles in the United States. American Suzuki wholesales virtually all of its inventory through a network of independently owned and unaffiliated dealerships located throughout the continental United States. The dealers then market and sell the Suzuki Products to retail customers. Suzuki Motor Corp., the 100% interest holder in the Debtor, manufacturers substantially all of the Suzuki products. American Suzuki has 295 employees. There are approximately 220 automotive dealerships, over 900 motorcycle/ATV dealerships, and over 780 outboard marine dealerships. American Suzuki filed a Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-22808) on Nov. 5, 2012, to sell the business to SMC, absent higher and better offers. SMC is not included in the Chapter 11 filing. The Debtor disclosed assets of $233 million and liabilities totaling $346 million. Debt includes $32 million owing to the parent on a revolving credit and $120 million for inventory financing. There is about $4 million owing to trade suppliers. The Debtor also filed a plan of reorganization together with the petition. Under the proposed Plan, the Motorcycles/ATV and Marine Divisions will remain largely unaffected including the warranties associated with the products. NounCo, Inc., a wholly owned subsidiary of SMC, will purchase the Motorcycles/ATV and Marine Divisions and the parts and service components of the Automotive Division. The restructured Automotive Division intends to honor automotive warranties and authorize the sale of genuine Suzuki automotive parts and services to retail customers through a network of parts and service only dealerships that will provide warranty services. Bankruptcy Judge Catherine E. Bauer signed an order Oct. 6 reassigning the case to Judge Scott Clarkson. ASMC's legal advisor on the restructuring is Pachulski Stang Ziehl & Jones LLP, and its financial advisor is FTI Consulting, Inc. Nelson Mullins Riley & Scarborough LLP is serving as special counsel on automobile dealer and industry issues. Further, ASMC has proposed the appointment of Freddie Reiss, Senior Managing Director at FTI Consulting, as chief restructuring officer, and has also added two independent Board members to assist it through this period. Rust Consulting Omni Bankruptcy, a division of Rust Consulting, Inc., is the claims and notice agent. The Debtor has retained Imperial Capital, LLC as investment banker. SMC is represented by lawyers at Klee, Tuchin, Bogdanoff & Stern LLP. Frank Cadigan, Assistant U.S. Trustee for Region 16, appointed seven creditors to serve in the Official Committee of Unsecured Creditors. The Committee tapped to retain Irell & Manella LLP as its counsel, and AlixPartners, LLC as its financial advisor. ANIXTER INT'L: Fitch Assigns 'BB-' Senior Unsecured Debt Rating --------------------------------------------------------------- Fitch Ratings has affirmed Anixter International Inc.'s and its wholly owned operating subsidiary, Anixter Inc.'s ratings as follows: Anixter -- Issuer Default Rating (IDR) at 'BB+'; -- Senior unsecured debt at 'BB-'. Anixter Inc. -- IDR at 'BB+'; -- Senior unsecured notes at 'BB+'; -- Senior unsecured bank credit facility at 'BB+'. The Rating Outlook is Stable. Fitch's stable outlook for IT distributors in 2013 reflects the companies' strong liquidity and countercyclical cash flows, which help offset Fitch's expectations for a difficult competitive environment and softening end market demand. Fitch's base scenario is for flat to modestly negative revenue change in 2013, although risk is weighted to the downside with the potential for a cyclical decline pending global economic conditions. Fitch views a reasonable stress scenario for the distributors at this point in time as consisting of a double digit decline in 2013 continuing through part of 2014. Under both scenarios, Fitch would expect significant margin compression but for EBITDA margins to remain positive across the sector. FCF generation would likely be significantly positive, given the expected resulting decline in working-capital balances under such a scenario. Fitch believes Anixter would maintain its 'BB+' rating under such a scenario. This assumes cash generated from working-capital declines does not go to shareholders or aggressive acquisitions that would ultimately result in higher leverage once growth returns and working capital would be expected to increase. Fitch would be concerned if revenues declined from a loss of market share, either to other distributors or suppliers increasingly going direct to market. The ratings and Outlook incorporate the above considerations as well as the following: -- Fitch expects low single digit organic revenue growth in fiscal 2013 as growth in emerging markets and Anixter's wire and cable segment offsets macroeconomic softness. Fitch believes EBITDA margins (currently 6.6% for the LTM ending Sept. 28, 2012) may be pressured given difficulties in sustaining profitability in Europe and softening end market-demand in North America. -- In a stress scenario, Fitch would expect EBITDA margins to decline to levels near the trough of the last downturn, roughly 5%, or moderately lower if revenue declines are more severe or copper prices approach 2009 levels of roughly $2/lb. Fitch would expect working capital cash inflows to roughly offset lower EBITDA levels and free cash flow to be above $200 million. In a flat revenue environment, Fitch estimates Anixter would generate more than $200 million in annual free cash flow. -- Fitch estimates that impact from copper prices and increasing U.S. dollar values relative to foreign currencies have offset revenue growth by roughly $66 million in the LTM. While the impact from these factors has been subdued relative to prior years given relatively stable copper prices and currency values, Fitch believes Anixter's exposure to copper and foreign currency generally increases volatility of profitability and cash flow generation, adding additional risk to the credit profile. -- Anixter executed both share repurchases and dividends totaling $210 million in the LTM period ($57 million in share repurchases, and a special dividend of $153 million). Fitch expects that, aside from the upcoming $300 million convertible note maturity in March 2013, Anixter will continue to utilize excess cash and free cash flow for potential acquisitions and shareholder friendly actions rather than debt reduction. Share repurchases and special dividends in excess of free cash flow in the face of mounting macroeconomic concerns could pressure Anixter's rating if such action would be expected to lead to additional higher leverage once revenue growth returns. -- Fitch estimates leverage at 2.5 times (x) in the LTM, (3.4x on an adjusted basis), which reflects elevated debt levels following Anixter's $350 million issuance in April. Fitch expects debt to decline slightly given the scheduled $300 million of convertible note maturity in March 2013. Fitch views leverage of 2.5x or below (3.5x adjusted) as reasonable for a 'BB+' rating given Anixter's business model and credit profile. Ratings strengths include: -- Leading market position in niche distribution markets which Fitch believes contributes to Anixter's above-average margins for a distributor; -- Broad diversification of products, suppliers, customers and geographies which adds stability to the company's financial profile by reducing operating volatility; -- Working capital efficiency which allows the company to generate free cash flow in a downturn. Rating concerns continue to center on: -- Historical use of debt and free cash flow for acquisitions and shareholder-friendly actions; -- Thin operating margins characteristic of the distribution industry, albeit slightly expanded given the company's niche market position; -- Significant unhedged exposure to copper prices and currency prices; -- Exposure to the cyclicality of IT demand and general global economic conditions. Fitch believes Anixter's liquidity was adequate and consisted of the following as of Sept. 28, 2012: i) approximately $137 million of cash and cash equivalents; ii) $400 million of five-year revolving credit agreements maturing April 2016, of which, $243 million was available; and iii) an undrawn $300 million on- balance-sheet accounts receivable securitization program expiring May 2015. Total debt as of Sept. 28, 2012 was $1 billion and consisted primarily of the following: -- $156 million outstanding under bank revolving credit lines; -- $293 million in 1% convertible unsecured notes due March 2013; -- $200 million in 5.95% senior unsecured notes due February 2015; -- $31 million in 10% senior notes due February 2014; and -- $350 million 5.625% senior notes due May 2019. The 1% convertible notes are issued by Anixter International and are structurally subordinated to the remaining debt which is issued by Anixter Inc. Anixter Inc. is the operating company under the parent company of Anixter International. What Could Trigger A Rating Action Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- Revenue declines that signal a loss of market share, either to other distributors or suppliers increasingly going direct to market; -- Severe operating margin compression resulting from intense competition; -- Significant debt-financed acquisitions and/or share repurchases, particularly if funded from cash generated from working capital declines. Positive: Upside movement in the ratings is limited given Anixter's history of shareholder-friendly actions. A long-term strategic business rationale and demonstrated commitment from management to maintain a higher rating would be necessary. ARAMARK CORP: Moody's Rates $670-Mil. Add-On Term Loan 'Ba3' ------------------------------------------------------------ Moody's Investors Service assigned a Ba3 rating to the proposed $670 million add-on to ARAMARK Corporation's secured term loan due 2016. Proceeds will be used to repay $650 million of term loans set to mature January 2014 and pay transaction fees and expenses. The ratings on the secured Term Loan due 2014 will be withdrawn upon repayment. The ratings outlook is stable. Ratings Rationale The B1 CFR reflects ARAMARK's scale and recurring revenue stream, leading to Moody's expectation of modestly improved cash flow driving debt to EBITDA down to 5.25 times and EBITDA less capital expenditures to interest up to about 1.7 times in 2013. Debt to EBITDA remains high for a B1 rated service company at about 5.5 times. The stable outlook reflects Moody's expectation of low single digit revenue growth and a moderate improvement in EBITDA over the next year driven by slowly improving conditions across most service lines and a continued focus on aggressive cost management and business process improvements. The ratings could be downgraded if, as a result of some combination of poor results from operations, acquisitions or shareholder-friendly actions, debt to EBITDA is not maintained at or below 5.5 times or free cash flow to debt is expected to be sustained below 2%. The ratings could be upgraded if the company achieves sustained revenue and profitability growth and demonstrates conservative financial policies such that Moody's expects debt to EBITDA to be sustained at about 4.5 times. Ratings Assigned: ARAMARK Corporation Add-On to Senior Secured Term Loan C due 2016, Ba3 (LGD3, 34%) Ratings unchanged with point estimate revision: ARAMARK Corporation Senior Secured Revolving Credit Facility due 2015, Ba3 (to LGD3, 34% from LGD3, 31%) Senior Secured Term Loan Facility due 2016, Ba3 (to LGD3, 34% from LGD3, 31%) Synthetic Letter of Credit Facilities due 2014 & 2016, Ba3 (to LGD3, 34% from LGD3, 31%) Senior Unsecured Notes due 2015, B3 (to LGD5, 81% from LGD5, 79%) The principal methodology used in rating ARAMARK was the Global Business & Consumer Service Industry Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. ARAMARK is a leading provider of a broad range of managed services to business, educational, healthcare and governmental institutions and sports, entertainment and recreational facilities, and the second largest uniform and career apparel business in the United States. ARAMARK is owned by a consortium of affiliates of private equity sponsors (GS Capital Partners, CCMP Capital Advisors, J.P. Morgan Partners, Thomas H. Lee Partners and Warburg Pincus) and the company's management team. Moody's expects fiscal 2012 revenue of approximately $13.5 billion. ARAMARK CORP: S&P Keeps 'BB' Rating on $1.5 Billion Term Loan ------------------------------------------------------------- Standard & Poor's Ratings Services said its senior secured debt ratings on Philadelphia-based ARAMARK Corp.'s existing term loan C, which is being upsized to $1.528 billion, including a proposed $670 million add-on term loan, is unchanged at 'BB' (two notches above the corporate credit rating on ARAMARK), with a recovery rating of '1', indicating S&P's expectation of very high (90% to 100%) recovery in the event of a payment default. "At the same time, we assigned ARAMARK Canada Ltd.'s proposed extended $50 million revolving credit facility due Jan. 26, 2015, a 'BB' rating and a recovery rating of '1'. We expect the proceeds from the food and support service operator's proposed add-on term loan will be used primarily to repay its $650 million term loan due in January of 2014. The ratings are subject to change, and assume the transactions close on substantially the terms presented to us," S&P said. "All of our other existing ratings on the company, including the 'B+' corporate credit rating, remain unchanged. The outlook is stable. Pro forma for the proposed transactions, total debt outstanding is about $6 billion," S&P said. "The ratings on ARAMARK Holdings Corp., the ultimate parent company of ARAMARK Corp., reflect our view that the company's financial risk profile remains 'highly leveraged,' incorporating a very aggressive financial policy, continued high debt maturities over the next two years, and considerable cash flow required to fund capital expenditures and pay interest costs. Although we believe the company has the capacity to meaningfully improve credit ratios over time, we see the potential for another significant debt-financed shareholder distribution or other leveraging event in the future. This is currently a constraining rating factor," S&P said. "We characterize ARAMARK's business risk profile as "satisfactory" and believe the company benefits from its satisfactory--though not dominant--positions in the competitive, fragmented markets for food and support services and uniform and career apparel. We also believe the company will continue to derive a significant portion of its cash flow from less economically sensitive sectors, including education and health care; and that the company's diversified customer portfolio reduces contract renewal risk. These factors translate into a sizable stream of predictable, recurring revenues, and healthy cash flow generation," S&P said. RATING LIST ARAMARK Holdings Corp. ARAMARK Corp. Corporate credit rating B+/Stable/-- Ratings unchanged ARAMARK Corp. Senior secured $1.528 bil. term loan C due 2016 BB Recovery rating 1 Ratings assigned ARAMARK Canada Ltd. ARAMARK Corp. Senior secured $50 mil. revolver due 2015 BB Recovery rating 1 ARCAPITA BANK: Has Interim Approval for Fortress Financing ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Arcapita Bank BSC received interim approval from the bankruptcy court on Dec. 7 to borrow $25 million from a $150 million loan provided by Fortress Credit Corp. There will be a final hearing on Dec. 18 for approval of the remainder of the loan. The loan will comply with Islamic Shariah financing regulations. Originally, Arcapita intended to nail down financing from Silver Point Finance LLC, until Fortress proffered a more attractive loan. According to the report, Arcapita's exclusive period to propose a plan ends Dec. 15, although Arcapita retains the exclusive right to solicit acceptances until Feb. 12. The Feb. 12 deadline can be extended. 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. ARCHDIOCESE OF MILWAUKEE: Parishes' Assets Out of Ch. 11 -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the Archdiocese of Milwaukee won a significant victory when the bankruptcy judge ruled that assets of the parishes can't be thrown into the pot for payment of sexual-abuse claims. The report recounts that the official creditors' committee filed papers asking U.S. Bankruptcy Judge Susan V. Kelley to allow the panel to file suit seeking to bring the parishes into the bankruptcy and combine their assets with those of the archdiocese. According to the report, Judge Kelley refused, saying the creditors failed to make out a "colorable claim" for so-called substantive consolidation. Judge Kelley also said in her Dec. 7 opinion that the creditors hadn't made out a case showing that the parishes were alter egos for the archdiocese. The archdiocese showed Judge Kelley how each of the 210 parishes were separately incorporated, mostly before 1930. The archbishop isn't involved in the daily operations of the parishes, she said. Judge Kelley said the committee failed to make out a "plausible claim of complete domination" of the archdiocese over the parishes. Similarly, there was no proof that the parishes failed to observe corporate formalities or that funds were siphoned off by the archdiocese. Consequently, Judge Kelley barred the committee from filing suit aimed at hauling the parishes and their assets into the bankruptcy. About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARIZONA CHEMICAL: Moody's Maintains 'Ba3' Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service maintained Arizona Chemical Holdings Corporation's (ACHC) Ba3 Corporate Family Rating (CFR) and the rating on AZ Chem US Inc.'s six-year $550 million Term Loan due 2017 at Ba3 (LGD3, 45%). The company is proposing an amendment that increases the size of the term loan by $100 million and allows for a sizable dividend. Headquartered in Jacksonville - Florida, ACHC is a global leader in the production and sales of pine based specialty chemicals. Estimated revenue for the LTM period ended September 30, 2012 was approximately $1.1 billion. BAKERS FOOTWEAR: Files Schedules of Assets and Liabilities ---------------------------------------------------------- Bakers Footwear Group Inc. filed with the Bankruptcy Court for the Eastern District of Missouri its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $62,135,955 B. Personal Property C. Property Claimed as Exempt D. Creditors Holding Secured Claims $17,961,047 E. Creditors Holding Unsecured Priority Claims $2,489,495 F. Creditors Holding Unsecured Non-priority Claims $45,897,845 ----------- ----------- TOTAL $62,135,955 $66,348,387 About Bakers Footwear Bakers Footwear Group Inc., a mall-based retailer of shoes for young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a plan to close stores and reduce costs. Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc., later renamed Weiss and Neuman Shoe Co., a regional chain of footwear stores. In 1997, Bakers was acquired principally by its current chief executive officer, Peter Edison, who had previously served in various senior management positions at Edison Brothers Stores Inc. In June 1999, Bakers purchased selected assets of the "Bakers" and "Wild Pair" footwear retailing chains from the bankruptcy estate of Edison Brothers. The "Bakers" footwear retailing chain was founded in 1924 and is the third-oldest soft goods retail concept still in operation in the United States. In February 2001, the Debtor changed its name to Bakers Footwear Group, Inc. In February 2004, Bakers conducted an initial public offering of its common stock. Bakers' common stock is quoted under the ticker symbol "BKRS" on the, the OTC Markets Group's quotation platform. As of the Petition Date, Bakers operates roughly 215 stores nationwide. In November 2012, the U.S. Bankruptcy Court in St. Louis authorized the company to hire a joint venture between SB Capital Group LLC and Tiger Capital Group LLC as agents to conduct closing sales for 150 stores. Bankruptcy Judge Charles E. Rendlen III presides over the case. Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel. Alliance Management serves as financial and restructuring advisors. Donlin, Recano & Company, Inc., serves as claims agent. The petition was signed by Peter A. Edison, chief executive officer and president. The Company's balance sheet at April 28, 2012, showed $41.90 million in total assets, $59.49 million in total liabilities and a $17.59 million total shareholders' deficit. Counsel for Crystal Financial, the DIP Lender, are Donald E. Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade, Esq., at Spencer, Fane, Britt & Brown, LLP. Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. BAKERS FOOTWEAR: Can Hire GA Keen as Real Estate Consultant ----------------------------------------------------------- Bakers Footwear Group Inc. sought and obtained approval from the U.S. Bankruptcy Court to employ GA Keen Realty Advisors, LLC as real estate consultant. The firm will provide these services: (a) Meeting with the Debtor, lender Crystal Financial LLC, and the Committee to ascertain the Debtor's goals, objectives and financial parameters; (b) At the Debtor's direction and on the Debtor's behalf, negotiating waivers or reductions of prepetition cure amounts and Section 502(b)(6) claims with respect to leases; (c) At the Debtor's direction and on the Debtor's behalf, negotiating the termination, assignment, sublease or other disposition of leases; (d) Assisting the Debtor at any auction for Leases, as needed; (e) Assisting the Debtor in the documentation of proposed transactions; (f) Reporting periodically to the Debtor regarding the status of negotiations; and (g) Consulting with the Debtor's incumbent real-estate consultant, Mark H. Brown & Associates LLC. Mark P. Naughten attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. As compensation for its services, Keen will receive these fees: (1) Lease Dispositions: (a) Upon the closing of a transaction in which any Lease is assigned or otherwise transferred to a third party or the related property is subleased to a third party, Keen will earn a fee in an amount equal to the greatest of: (i) 3% of the gross proceeds of the disposition, (ii) 3% of the 11 U.S.C. Sec. 502(b)(6) rejection claim dividend that would have been payable to the applicable landlord if the lease were rejected, estimated in good faith as of such closing in light of the expected recovery to general unsecured creditors, or (iii) $3,000. The term "Gross Proceeds" means the total amount of consideration paid or payable to or for the benefit of the Debtor's estate by the purchaser, assignee, designation rights purchaser, landlord or other transferee. For subleases, "Gross Proceeds" means the net present value, using a 6.0% discount factor, of the expected sublease income payable by the subtenant. (2) Reduction in Rejection Damages. For any Lease rejected by the Debtor, if the landlord agrees to reduce or waive the claim it could reasonably assert under Bankruptcy Code Sec. 502(b)(6) or otherwise, Keen will receive a fee in an amount equal to the greater of $2,550 or 3% of the savings relative to the estimated dividend that otherwise would have been payable to the landlord in the Debtor's bankruptcy case, estimated in good faith as of the time such fee is payable in light of the expected recovery to general unsecured creditors. (3) Lease Rejection Fee. In the event that a Lease is rejected and Keen has not earned a fee as per the above provisions, then Keen will have earned a minimum fee of $300 per Lease for its marketing and negotiation efforts with respect to the Lease; provided, however, that the aggregate lease rejection fees payable to Keen will not exceed $25,000. (4) Going Concern Sale. The Debtor and Keen acknowledge that the Debtor may be sold as a going concern, in whole or in part. If all or substantially all of the Leases are sold or assigned to a purchaser as part of a "going concern" transaction, then Keen will be entitled to $2,550 per Lease sold as part of a going concern sale. (5) Aldo Sale. Keen acknowledges that the Debtor has a pending contract to assign certain Leases to Aldo U.S., Inc. and that Aldo has proposed a modification of such contract in a letter dated Oct. 18, 2012. The parties agree that Keen's compensation in connection with any transaction between the Debtor and Aldo shall be a fee equal to 17.5% of the amount by which the Gross Proceeds of such transaction exceed the proceeds proposed to be paid by Aldo in its Oct. 18, 2012 letter, but the fee will not exceed 3% of the Gross Proceeds of such transaction. (6) Brown. Keen acknowledges that Brown shall be responsible for the renegotiation or amendment of Leases to be retained by the Debtor. Keen will not be entitled to any compensation in connection with any such renegotiation or amendment. About Bakers Footwear Bakers Footwear Group Inc., a mall-based retailer of shoes for young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a plan to close stores and reduce costs. Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc., later renamed Weiss and Neuman Shoe Co., a regional chain of footwear stores. In 1997, Bakers was acquired principally by its current chief executive officer, Peter Edison, who had previously served in various senior management positions at Edison Brothers Stores Inc. In June 1999, Bakers purchased selected assets of the "Bakers" and "Wild Pair" footwear retailing chains from the bankruptcy estate of Edison Brothers. The "Bakers" footwear retailing chain was founded in 1924 and is the third-oldest soft goods retail concept still in operation in the United States. In February 2001, the Debtor changed its name to Bakers Footwear Group, Inc. In February 2004, Bakers conducted an initial public offering of its common stock. Bakers' common stock is quoted under the ticker symbol "BKRS" on the, the OTC Markets Group's quotation platform. As of the Petition Date, Bakers operates roughly 215 stores nationwide. In November 2012, the U.S. Bankruptcy Court in St. Louis authorized the company to hire a joint venture between SB Capital Group LLC and Tiger Capital Group LLC as agents to conduct closing sales for 150 stores. Bankruptcy Judge Charles E. Rendlen III presides over the case. Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel. Alliance Management serves as financial and restructuring advisors. Donlin, Recano & Company, Inc., serves as claims agent. The petition was signed by Peter A. Edison, chief executive officer and president. The Company's balance sheet at April 28, 2012, showed $41.90 million in total assets, $59.49 million in total liabilities and a $17.59 million total shareholders' deficit. Counsel for Crystal Financial, the DIP Lender, are Donald E. Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade, Esq., at Spencer, Fane, Britt & Brown, LLP. Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. BAKERS FOOTWEAR: Court OKs Bryan Cave as Restructuring Counsel -------------------------------------------------------------- Bakers Footwear Group, Inc., sought and obtained permission from the U.S. Bankruptcy Court to employ Bryan Cave LLP as its general restructuring counsel, as well as to provide advice and counsel regarding corporate, employment, employee benefits, finance, real estate, securities, tax, and other matters. Bryan Cave has represented the Debtor for more than 10 years as its outside general corporate and securities counsel. Bryan Cave also represented the Debtor in connection with its recent secured financing facility provided by the Debtor's lender, Crystal Financial LLC. "Little purpose would be served, and unnecessary expense, duplication of effort, and delay would undoubtedly result, if substitute counsel were retained to address issues previously handled by Bryan Cave," said Peter A. Edison, the Debtor's Chairman and CEO. Brian C. Walsh, Esq., a partner at the firm, attests that Bryan Cave does not hold or represent any interest adverse to the Debtor's estate; Bryan Cave is a "disinterested person" as that phrase is defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy Code; and Bryan Cave's employment is necessary and in the best interests of the Debtor's estate. Other Bryan Cave lawyers who will be working on the case are David M. Unseth, Esq,. and Laura Uberti Hughes, Esq., from the law firm's St. Louis, Missouri offices. Hourly rates for Bryan Cave's professionals based in St. Louis, which are subject to adjustment from time to time, presently are: Partners and Counsel $390 to $785 per hour Associates $200 to $420 per hour Legal Assistants $150 to $250 per hour Bryan Cave received a $275,000 retainer from the Debtor in several installments, beginning on Aug. 23, 2012. Prior to the Chapter 11 filing, Bryan Cave applied the retainer against invoices for attorneys' fees and expenses incurred on or after the date on which Bryan Cave received the first retainer installment. Bryan Cave also received an additional retainer of $400,000 from the Debtor on Occt. 2. Bryan Cave will hold these funds in its client trust account as security for the fees and expenses that may be awarded to it in this case. From Oct. 1, 2011, through the Petition Date, Bryan Cave received $418,490.10 in payment of professional fees and expenses provided by Bryan Cave to the Debtor. Of this amount, $225,253.85 was paid for services rendered or to be rendered in contemplation of or in connection with the Chapter 11 case. As of the Petition Date, Bryan Cave was owed $335,067.81 by the Debtor for attorneys' fees and expenses incurred before Aug. 23, 2012, the date on which Bryan Cave received the first retainer installment from the Debtor, and $16,875.53 for attorneys' fees and expenses incurred on or after Aug. 23, 2012 that were not covered by Bryan Cave's $275,000 retainer. Bryan Cave has agreed to waive its claim against the Debtor for attorneys' fees and expenses that were incurred and unpaid as of the Petition Date. About Bakers Footwear Bakers Footwear Group Inc., a mall-based retailer of shoes for young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a plan to close stores and reduce costs. Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc., later renamed Weiss and Neuman Shoe Co., a regional chain of footwear stores. In 1997, Bakers was acquired principally by its current chief executive officer, Peter Edison, who had previously served in various senior management positions at Edison Brothers Stores Inc. In June 1999, Bakers purchased selected assets of the "Bakers" and "Wild Pair" footwear retailing chains from the bankruptcy estate of Edison Brothers. The "Bakers" footwear retailing chain was founded in 1924 and is the third-oldest soft goods retail concept still in operation in the United States. In February 2001, the Debtor changed its name to Bakers Footwear Group, Inc. In February 2004, Bakers conducted an initial public offering of its common stock. Bakers' common stock is quoted under the ticker symbol "BKRS" on the, the OTC Markets Group's quotation platform. As of the Petition Date, Bakers operates roughly 215 stores nationwide. Bankruptcy Judge Charles E. Rendlen III presides over the case. Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel. Alliance Management serves as financial and restructuring advisors. Donlin, Recano & Company, Inc., serves as claims agent. The petition was signed by Peter A. Edison, chief executive officer and president. The Company's balance sheet at April 28, 2012, showed $41.90 million in total assets, $59.49 million in total liabilities and a $17.59 million total shareholders' deficit. Counsel for Crystal Financial, the DIP Lender, are Donald E. Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade, Esq., at Spencer, Fane, Britt & Brown, LLP. BAKERS FOOTWEAR: Alliance Management Approved as Fin'l Advisor -------------------------------------------------------------- Bakers Footwear Group, Inc., sought and obtained final approval to employ the firm of Alliance Management as its financial advisor. Alliance has acted as the Debtor's financial and restructuring advisor prior to the Petition Date in connection with the Debtor's restructuring. James Cullen, management consultant with BGA Management LLC, doing business as Alliance Management, attests the firm does not hold or represent any interest adverse to the Debtor's estate; Alliance is a "disinterested person" as that phrase is defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy Code; and Alliance's employment is necessary and in the best interests of the Debtor's estate. The firm's professionals who will be working on the case and their hourly rates are: James Cullen $450 per hour Michael Knight $460 per hour Alex Smith $375 per hour Chris Tomas $375 per hour Steve Murray $375 per hour David Burke $325 per hour Brock Kline $250 per hour Justin Pugh $250 per hour Deb Cramer $175 per hour Prior to the petition date, the firm received $365,000 in the aggregate from the Debtor as retainer. Alliance is not owed any amount from the Debtor for pre-petition fees and expenses. About Bakers Footwear Bakers Footwear Group Inc., a mall-based retailer of shoes for young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a plan to close stores and reduce costs. Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc., later renamed Weiss and Neuman Shoe Co., a regional chain of footwear stores. In 1997, Bakers was acquired principally by its current chief executive officer, Peter Edison, who had previously served in various senior management positions at Edison Brothers Stores Inc. In June 1999, Bakers purchased selected assets of the "Bakers" and "Wild Pair" footwear retailing chains from the bankruptcy estate of Edison Brothers. The "Bakers" footwear retailing chain was founded in 1924 and is the third-oldest soft goods retail concept still in operation in the United States. In February 2001, the Debtor changed its name to Bakers Footwear Group, Inc. In February 2004, Bakers conducted an initial public offering of its common stock. Bakers' common stock is quoted under the ticker symbol "BKRS" on the, the OTC Markets Group's quotation platform. As of the Petition Date, Bakers operates roughly 215 stores nationwide. In November 2012, the U.S. Bankruptcy Court in St. Louis authorized the company to hire a joint venture between SB Capital Group LLC and Tiger Capital Group LLC as agents to conduct closing sales for 150 stores. Bankruptcy Judge Charles E. Rendlen III presides over the case. Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel. Alliance Management serves as financial and restructuring advisors. Donlin, Recano & Company, Inc., serves as claims agent. The petition was signed by Peter A. Edison, chief executive officer and president. The Company's balance sheet at April 28, 2012, showed $41.90 million in total assets, $59.49 million in total liabilities and a $17.59 million total shareholders' deficit. Counsel for Crystal Financial, the DIP Lender, are Donald E. Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade, Esq., at Spencer, Fane, Britt & Brown, LLP. Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the Official Committee of Unsecured Creditors. BALLENGER CONSTRUCTION: Case Summary & 20 Largest Unsec Creditors ----------------------------------------------------------------- Debtor: Ballenger Construction Company 24200 N FM 509 Harlingen, TX 78550 Bankruptcy Case No.: 12-20645 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Southern District of Texas (Corpus Christi) Judge: Richard S. Schmidt Debtor's Counsel: Roderick Glen Ayers, Jr., Esq. LANGLEY BANACK INC. 745 E Mulberry, Ste 900 San Antonio, TX 78212-3166 Tel: (210) 736-6600 Fax: (210) 735-6889 E-mail: gayers@langleybanack.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50,000,000 A copy of the Company's list of its 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/txsb12-20645.pdf The petition was signed by Joe C. Ballenger Jr./Joe C. Ballinger Sr., president/CEO. BARLEN CONTRATING: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Barlen Contrating, Inc. P.O. Box 271 Brighton, MI 48114 Bankruptcy Case No.: 12-66638 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Eastern District of Michigan (Detroit) Judge: Walter Shapero Debtor's Counsel: William R. Orlow, Esq. B.O.C. LAW GROUP, P.C. 24100 Woodward Ave. Pleasant Ridge, MI 48069 Tel: (248) 584-2100 E-mail: bocecf@boclaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 Affiliates that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- Barlen P.G. Inc. 12-66590 Assets: $0 to $50,000 Debts: $1,000,001 to $10,000,000 Barlen Sanitation Solutions, Inc. 12-66663 Assets: $0 to $50,000 Debts: $1,000,001 to $10,000,000 The petitions were signed by Joe C. Ballenger Jr./Joe C. Ballinger Sr., president/CEO. A. A copy of Barlen Contrating's list of its 15 largest unsecured creditors is available for free at http://bankrupt.com/misc/mieb12-66638.pdf B. A copy of Barlen P.G.'s list of its 17 largest unsecured creditors is available for free at http://bankrupt.com/misc/mieb12-66590.pdf C. A copy of Barlen Sanitation's list of its 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/mieb12-66663.pdf BOWLES SUB: Asks for Court OK to Hire Anton Economics as Economist ------------------------------------------------------------------ Bowles Sub Parcel A, LLC, and its affiliated debtors -- Bowles Sub Parcel B, LLC, Bowles Sub Parcel C, LLC, Fenton Sub Parcel A, LLC, Fenton Sub Parcel B, LLC, and Fenton Sub Parcel C, LLC -- seek permission from the Hon. Nancy C. Dreher of the U.S. Bankruptcy Court for the District of Minnesota to Paul A. Anton and Anton Economics, LLC, as economist to represent them in connection with all matters pertaining to the confirmation of the plans, specifically, testimony regarding appropriate interest rates and risks. The Debtors' counsel, Lapp Libra Thomson Stoebner & Pusch, is paying Anton Economics a $3,000 retainer fee and will be reimbursed from Debtors' bankruptcy estate pursuant to fee applications of Debtors' counsel. Anton Economics will be paid $100 per hour for time spent preparing graphics or exhibits. In the event that Anton Economics outsource the preparation of graphics or exhibits, the firm will be reimbursed for the actual cost of the outsourced services, plus a 5% handling fee; however, the fee for outsourced services will not exceed the rate of $100 per hour without the Counsel's approval. Paul A. Anton, chief economist and owner of Anton Economics, attests to the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Anton Economics can be reached at: Anton Economics LLC 333 Washington Avenue North, Suite 208 Minneapolis, Minnesota 55401 E-mail: paulanton@antoneconomics.com About StoneArch II/WCSE Entities StoneArch II/WCSE Minneapolis Industrial LLC in 2007 acquired various limited liability companies, which in turn owned 27 industrial multi-tenant properties located in Minneapolis/St. Paul in Minnesota. The properties were divided into four separate pools: A, B, C, and D. Fenton Sub Parcel D LLC and Bowles Sub Parcel D LLC, which jointly own the properties in pool D, sought Chapter 11 protection (Bankr. D. Minn. Case Nos. 11-44430 and 11-44434) on June 29, 2011. A Chapter 11 plan has been filed for the pool D debtors. The plan, if approved, would allow the existing owners to maintain operation of the properties. Bowles Sub Parcel A, LLC, and five other entities, which jointly own parcels A, B and C, filed for Chapter 11 protection (Bankr. D. Minn. Case Nos. 12-42765, 12-42768, 12-42769, 12-42770, 12-42772, and 12-42774) on May 8, 2012. Each of the May 8 Debtors estimated $10 million to $50 million in assets. Bowles Sub A disclosed $11,442,268 in assets and $9,716,342 in liabilities as of the Chapter 11 filing. The other May 8 debtors are Fenton Sub Parcel A, LLC, Bowles Sub Parcel B, LLC, Fenton Sub Parcel B, LLC, Bowles Sub Parcel C, LLC, and Fenton Sub Parcel C, LLC. Judge Nancy C. Dreher oversees the May 8 Debtors' cases, taking over from Judge Gregory F. Kishel. The May 8 Debtors tapped Lapp Libra Thomson Stoebner & Pusch as counsel. Steven B. Hoyt, as chief manager, signed the Chapter 11 petitions. BROOKDALE HOSPITAL: GA Keen Closes Sale of Apartment Buildings -------------------------------------------------------------- GA Keen Realty Advisors, LLC, a division of Great American Group, Inc., recently advised Brookdale Hospital and Medical Center on a complex, $22 million sale of a real estate portfolio consisting of four apartment buildings previously owned by the hospital. GA Keen Realty Advisors brought together a group of Brooklyn multi-family investors, led by apartment owners David Spira and Robert Wolf, who closed on the purchase Nov. 2. According to GA Keen Realty Advisors Co-President Matthew Bordwin, a 12-month "rent hold" needed to be addressed as part of the sale, making the deal more challenging. In addition, the New York State Attorney General's office needed to approve the transaction, as is policy when selling a property owned by a not-for-profit entity. "The rents being paid by the tenants are below market, and we expect they'll stay that way due to rent regulations," Mr. Bordwin said. "Given these constraints, the sales price generated represented an outstanding price for the seller based on the current net operating income being generated by the properties." "We were extremely pleased with the expertise provided by GA Keen Realty Advisors and the end result we achieved," said Steve Korf, a partner with the consulting firm of Grant Thornton and the interim chief operating officer at Brookdale Hospital. "Our firm was hired earlier this year to stabilize the hospital's financial position and this transaction represents a positive step in that process." The properties included a 20-story, 172-unit building at 7 Hegeman Ave.; a 12-story, 113-unit building at 660 E. 98th St.; a six- story, 54-unit property at 505 Rockaway Parkway; and a four-story, 42-unit building at 525 Rockaway Parkway. GA Keen Realty Advisors representatives involved in the transaction included Bordwin, co-president Harold Bordwin and brokers Christopher Mahoney and Heather Milazzo. Other members of the negotiating team were attorneys Brian Cohen, Chris Rabil and Jeff Thrope with the law firm of Foley & Lardner LLP, and Eric Altman, Jay Gerzog and Daniel Lewis with the law firm of Epstein Becker Green. Other members of the Grant Thornton team working with Korf included Mark Toney, the Chief Executive Officer, James Porter and Chris Jadro. About GA Keen Realty Advisors, LLC Located in New York, GA Keen Realty Advisors -- http://www.greatamerican.com/keen-- provides real estate analysis, valuation and strategic planning services, brokerage, M&A, auction services, lease restructuring services and real estate capital market services. About Great American Group, Inc. GA Keen Realty Advisors, LLC (OTCBB: GAMR) -- http://www.greatamerican.com-- is a wholly owned subsidiary of Great American Group, a provider of asset disposition and auction solutions, advisory and valuation services, capital investment, and real estate advisory services for an extensive array of companies. The corporate headquarters is located in Woodland Hills, Calif. with additional offices in Atlanta, Boston, Charlotte, N.C., Chicago, Dallas, New York, San Francisco and London. CAPITOL BANCORP: Hits Snag on Prepack Plan Confirmation ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Capitol Bancorp Ltd. hit a snag in the attempt at a quick conclusion to the prepackaged Chapter 11 filing in August in U.S. Bankruptcy Court in Detroit. According to the report, the Lansing, Michigan-based bank holding company had a tentative agreement where affiliates of Valstone Partners LLC would finance the reorganization plan by paying $50 million for common and preferred stock while buying $207 million in face amount of defaulted commercial and residential mortgages. Although the bankruptcy court authorized Capitol to pay Valstone's expenses in connection with a financial investigation, bank regulators didn't give approval in time for the buyer to finish due diligence by the Nov. 30 cutoff. Consequently, Valstone terminated the purchase agreement. Meanwhile, Capital, according to the report, pushed back the hearing for approval of the Chapter 11 plan until Jan. 29. The bankruptcy judge extended Capitol's exclusive plan-filing rights until March 7. The report relates that the Chapter 11 petition filed in Detroit was accompanied by a reorganization plan already accepted by the requisite majorities of creditors and equity holders in all classes. The plan would exchange debt and trust-preferred securities for equity. Holders of $6.8 million in senior notes would see a full recovery by receipt of new stock. Holders of $151.3 million in trust-preferred securities would take equity worth $50 million, for a one-third recovery. Holders of $5 million in preferred stock would have a 20% recovery from new equity, while common stockholders would take stock worth $15 million. Jan. 9 Hearing The Hon. Marci B. McIvor of the U.S. Bankruptcy Court for the Eastern District of Michigan continued until Jan. 9, 2013, at 10:30 a.m., the combined hearing to consider the approval of the solicitation procedures, adequacy of the Disclosure Statement and confirmation of Capitol Bancorp Ltd. and Financial Commerce Corporation's proposed Plan. The Court also ordered that: -- objections of the Committee must be (a) filed with the Court and (b) served upon all parties on the Special Service List no later than 5 p.m. on Jan. 22. The extended deadline will apply only to the Committee. The deadline for any other party in interest to file and serve any objections to the approval of the solicitation procedures, the adequacy of the Disclosure Statement or confirmation of the Plan will remain Sept. 10. -- The period within which only the Debtors may file an alternative plan, other than the Plan is extended until March 7. -- The period within which only the Debtors may solicit acceptances to any proposed alternative plan, other than the Plan, is extended until May 6. The hearing on the Plan has been adjourned a number of times. About Capitol Bancorp Capitol Bancorp Ltd. and Financial Commerce Corporation filed voluntary Chapter 11 bankruptcy petitions (Bankr. E.D. Mich. Case Nos. 12-58409 and 12-58406) on Aug. 9, 2012. Capitol Bancorp -- http://www.capitolbancorp.com/-- is a community banking company with a network of individual banks and bank operations in 10 states and total consolidated assets of roughly $2.0 billion as of June 30, 2012. CBC owns roughly 97% of FCC, with a number of CBC affiliates owning the remainder. FCC, in turn, is the holding company for five of the banks in CBC's network. CBC is registered as a bank holding company under the Bank Holding Company Act of 1956, as amended, 12 U.S.C. Sec. 1841, et seq., and trades on the OTCQB under the symbol "CBCR." Lawyers at Honigman Miller Schwartz and Cohn LLP represent the Debtors as counsel. In its petition, Capitol Bancorp scheduled $112,634,112 in total assets and $195,644,527 in total liabilities. The petitions were signed by Cristin K. Reid, corporate president. The Company's balance sheet at Sept. 30, 2012, showed $1.749 billion in total assets, $1.891 billion in total liabilities, and a stockholders' deficit of $141.8 million. CC HOLDINGS: S&P Gives 'BB' Rating on $1.5-Bil. Notes Issuances --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' issue level rating and '1' recovery rating to Crown Castle International Corp.'s (B+/Stable/--) subsidiary CC Holdings GS V LLC's proposed notes issuances. The issuances total $1.5 billion, and consist of $1 billion due 2023 and $500 million due 2017. CC Holdings will use the proceeds to complete a tender for existing notes at the entity, as well as to repay indebtedness at parent Crown Castle International Corp. The corporate credit rating and stable outlook on Crown Castle remain unchanged and reflect the company's "strong" business risk profile and "highly leveraged" financial risk profile. RATINGS LIST Crown Castle International Corp. Corporate Credit Rating B+/Stable/-- CC Holdings GS V LLC Crown Castle GS III Corp. $500 mil notes due 2017 BB Recovery Rating 1 $1 bil notes due 2023 BB Recovery Rating 1 CHARLIE MCGLAMRY: Wants Plan Exclusivity Extended to March 2013 --------------------------------------------------------------- Charlie N. McGlamry and its debtor-affiliates request for a 90-day extension of the period of time during which only the McGlamry Affiliates may propose and file plans of reorganization through and including March 5, 2013. Additionally, McGlamry and its affiliates request a 91-day extension of the period of time during which McGlamry and the McGlamry Affiliates may solicit acceptances of their plans of reorganization through and including May 6, 2013. This is the second request by the McGlamry affiliates to extend both deadlines. The Court record shows the Debtors have already made substantial progress and continues to work diligently on matters related to their reorganization. Since the Petition Date, the Debtors have concentrated on a number of significant issues relating to the estate. The McGlamry affiliates continue to work on preparing a financial plan that will form the basis of its Chapter 11 Plans. The Debtors have remained focused on developing a strategy to enable the Debtors to emerge successfully from Chapter 11, to the extent necessary to effectuate the overall plan for the Debtors. They are making progress toward the reorganization and the process of determining distributions to the Debtors' creditors. However, despite their progress toward this goal, the McGlamry affiliates are not at present in a position to propose plans. Additionally, McGlamry continues to negotiate with his creditors regarding the provisions of his Chapter 11 Plan. Because the Debtors are continuing to evaluate and pursue their alternatives, the parties in interest in this case will benefit from an extension of the exclusive periods. The McGlamry affiliates need additional time to develop plans that are in the best interest of creditors, which is time-consuming and somewhat complex. Additionally, McGlamry needs additional to continue negotiations with Synovus and his other creditors. An extension of time will provide the McGlamry affiliates with an opportunity to develop reasoned plans, additional time to continue to negotiate with his creditors, and to develop and negotiate what Debtors hope to be consensual plans of reorganization. The McGlamry Affiliates are developing and will present what they hope to be consensual plans of reorganization, but information must be analyzed and issues resolved before the McGlamry Affiliates can finalize such plans. Competing plans would present a direct impediment to the Debtors' progress. Extending the exclusive periods will allow the Debtors to work toward a resolution of Debtors' financial issues and allow the McGlamry affiliates to propose plans based on a rational and well-developed financial plan and McGlamry to attempt to solicit further acceptances for his Plan. At this time in the Chapter 11 process, the Debtors said they should not be faced with the distraction and expense of a premature filing of a plan by other parties and a competing plan fight. The hearing on the motion is scheduled for Jan. 16, 2013, at 11:00 a.m. About Charlie N. McGlamry Centerville, Georgia-based real estate developer Charlie N. McGlamry filed a petition for Chapter 11 protection, along with his 14 companies, in Macon, Georgia on May 9, 2012. Over the past 44 years, Mr. McGlamry has managed to successfully develop numerous real estate developments in and around Houston County, Georgia. Mr. McGlamry continues to operate his real estate development business through sole proprietorship McGlamry Properties -- http://www.mcglamryproperties.com-- and USA Land Development Inc. Mr. McGlamry individually owns, through his sole proprietorship, approximately, 74 acres of undeveloped commercial property at the intersection of Russell Parkway and Corder Road in Houston County, Georgia. Mr. McGlamry established a number of single member limited liability companies and sole shareholder corporations to own and develop specific tracts of land. Mr. McClamry and his affiliated companies sought joint administration of their Chapter 11 cases and have Mr. McGlamry's as the lead case (Bankr. M.D. Ga. Case No. 12-51197). Judge James P. Smith oversees the case. Cohen Pollock Merlin & Small, PC, serves as the Debtors' Chapter 11 counsel. Nichols, Cauley & Associates, LLC, serves as their accountant. Mr. McGlamry, as sole shareholder or member, signed Chapter 11 petitions for USA Land Development (Case No. 12-51198); Barrington Hall Development Corp. (12-51199); Bear Branch LLC; By- Pass/Courthouse LLC (12-51201); Chinaberry Place, LLC (12-51202); Eagle Springs LLC (12-51203); Elmdale Development, LLC (12-51204); Gurr/Kings Chapel Road, LLC (12-51205); Jaros Development LLC (12-51206); Lake Joy Development, LLC (12-51207); Old Hawkinsville Road, LLC (12-51208); South Houston Development, LLC (12-51209); The Villages at Nunn Farms, LLC (12-51210); and Houston-Peach Investments LLC (12-51212). Mr. McGlamry estimated up to $50 million in assets and up to $100 million in liabilities in his Chapter 11 filing. The Debtors tapped Cohen Pollock Merlin & Small, PC, as bankruptcy counsel. CHRYSLER LLC: Product Liability Class Suit Goes to SDNY Court ------------------------------------------------------------- New Jersey District Judge Michael A. Shipp granted the request of Chrysler Group, LLC, to transfer the venue of a product liability class action lawsuit to the U.S. District Court for the Southern District of New York. Jay Miller and Brooke Wiliman filed their original complaint on Feb. 8, 2012, and an amended to the complaint on March 14, 2012. In the Amended Complaint, the Plaintiffs, on behalf of a putative class, allege the existence of design defects in several models of Chrysler-brand vehicles that were manufactured, marketed, and distributed between 2006 and the present. The Plaintiffs contend that design defects and faulty installation of their factory- installed sunroofs caused leakage and, as a result thereof, harmed The Plaintiffs. The Plaintiffs assert a total of 11 claims based on alleged design flaws: (1) breach of contract; (2) breach of duty of good faith and fair dealing; (3) breach of express warranty; (4) breach of implied warranty; (5) breach of the Magnuson-Moss Act, 15 U.S.C. Sec. 2301; (6) negligence; (7) negligent misrepresentation; (8) violation of the New Jersey Consumer Fraud Act; (9) unjust enrichment; (10) injunctive and equitable relief; and (11) declaratory judgment. Chrysler Group, which purchased the assets of Chrysler LLC during its 2009 bankruptcy, said the "the threshold issue" underlying its Motion to Transfer "is whether Chrysler Group assumed the liabilities for the claims Plaintiffs make, and the relief they seek," under the terms of the Bankruptcy Court's June 1, 2009 order approving the sale. Chrysler Group argued that the Bankruptcy Court is the appropriate court to make this determination because it issued the Sale Order and retained jurisdiction to interpret the Sale Order. The case is, MILLER, Plaintiffs, v. CHRYSLER GROUP, LLC, Defendant, Civil Action No. 12-760 (D.N.J.). A copy of the Court's Dec. 7, 2012 Opinion is available at http://is.gd/Q1hsyV from Leagle.com. About Chrysler Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. As of Dec. 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat acquired a 20% equity interest in Chrysler Group as part of the deal. The U.S. and Canadian governments provided Chrysler with $4.5 billion to finance its bankruptcy case. Those loans were repaid with the proceeds of the bankruptcy estate's liquidation. In April 2010, the Bankruptcy Court confirmed Chrysler's Liquidating Plan. That Plan was declared effective April 30, 2010. The Debtor changed its corporate name to Old CarCo following the sale. CROWN CASTLE: Fitch Rates New $1.5BB Senior Unsecured Notes 'BB-' ----------------------------------------------------------------- Fitch Ratings has assigned a 'BBB-' rating to CC Holdings GS V LLC (GS V) proposed $1.5 billion senior secured notes. The two tranche issuance includes $1 billion in secured notes due 2023 and $500 million in senior secured notes due 2017. Crown Castle has also received preliminary commitments to increase its revolving credit facility by an additional $500 million, and expects to consummate such increase prior to the closing of the secured notes offering. Fitch has affirmed the following ratings for Crown Castle International Corp. (CCIC) and its subsidiaries GS V and Crown Castle Operating Company (CCOC) as follows: CCIC -- IDR at 'BB'; -- Senior unsecured debt at 'BB-'. CCOC -- IDR at 'BB'; -- $1.5 billion senior secured credit facility at 'BB+'; -- $488 million secured term loan A at 'BB+'; -- $1.6 billion secured term loan B at 'BB+'. CC Holdings GS V LLC (GS V) -- Senior secured notes at 'BBB-'; -- IDR at 'BB'. The Outlook is Stable. Fitch will withdraw issuance ratings at CCIC and GS V once the debt obligations have been fully repaid. GS V intends to use the net proceeds of this offering to complete a tender offer for any and all of its outstanding 7.75% senior secured notes due 2017 and to redeem any existing notes that remain outstanding. The remaining net proceeds will be distributed to CCIC to fund, together with borrowings under Crown Castle's upsized revolving credit facility, a tender offer for any and all of its outstanding 9% Senior Notes due 2015. The secured notes will be guaranteed by certain of GS V's direct and indirect subsidiaries. The notes and the guarantees will be secured on a first priority basis by a pledge of the equity interests of the guarantors. The notes will not be guaranteed by CCIC or any of its other subsidiaries. The two notch ratings uplift for the secured debt of GS V to 'BBB- ' reflects the superior recovery and over collateralization of the debt at the GS V operating company level. Absolute debt levels at GS V are increasing as a result of the new issuance to $1.5 billion from $1.2 billion when Fitch first rated the secured debt at GS V. However, since this time, increased lease-up rates and rent escalators have materially increased cash flows that provide support for the higher debt level. Fitch views this refinancing as neutral to the overall credit profile even though a greater mix of senior level debt will be placed ahead of CCIC's unsecured debt. Fitch believes the strong recurring cash flows and over collateralization provides a level of support that is consistent with CCIC's current unsecured debt ratings. As such Fitch has notched CCIC's unsecured debt one notch below its IDR, at 'BB-'. Current leverage pro forma for the T-Mobile tower acquisition is in the mid-6x range. This is materially outside of Fitch's current range for Crown's 'BB' rating. Fitch expects Crown to de-lever through a mix of cash flow growth and debt reduction in the next 12 to 15 months. This should improve credit protection measures back within rating expectations. Fitch projects leverage to be approximately 6x or lower by the end of 2013. Any deviation from the expected deleveraging path would likely result in Fitch taking a negative rating action. Crown's ratings are supported by strong recurring cash flows generated from its leasing operations, a robust EBITDA margin that should continue to increase through new lease-up opportunities, and the scale of its tower portfolio. The substantial operational scale provided by its large tower portfolio combined with favorable wireless demand characteristics should translate into sustainable operating performance and free cash flow (FCF) growth over the longer-term. As a result, Crown maintains significant flexibility with prioritizing the use of its liquidity and discretionary cash flow. Crown has used a significant portion of its liquidity to fund the acquisition and proposed debt refinancing. Crown has meaningful FCF generation, balance sheet cash, and favorable maturity schedule relative to available liquidity. Cash, excluding restricted cash, was $118 million as of Sept. 30, 2012. For the latest-twelve-month (LTM) period FCF was approximately $340 million. Crown spent $365 million on capital during this period with a significant portion allocated for land purchases, which is discretionary in nature. Crown has drawn down materially on its $1.5 billion (expected upsize by $500 million) senior secured revolving credit facility maturing in 2017. Fitch expects Crown will pay down the facility to restore availability under the revolver. The financial covenants within the credit agreement are more restrictive than in the past. This is evident in total net leverage ratio, which is 6.0x compared to 7.5x, and consolidated interest coverage of 2.5x compared to 2.0x. The financial leverage covenant has an additional stepdown to 5.5x in 2014. The credit agreement also has security fallaway provisions in the event CCIC achieves investment grade ratings. For 2012, Crown expects adjusted funds from operations of approximately $850 million. With the expected debt tender for the 2015 notes, Crown will now have approximately $550 million in maturities for 2015 primarily associated with its tower securitizations. Common stock repurchases have been scaled back significantly compared to past levels and were less than $40 million for the last twelve months. What Could Trigger A Rating Action Negative: Fitch believes Crown's leverage is outside of the current expectations for the 'BB' rating category as a result of the acquisition. Future developments that may, individually or collectively, lead to Fitch taking a negative rating action include: -- If Crown does not deleverage the company below 6x in the next 12-to-15 months; or -- If Crown makes additional material acquisitions that are debt financed. Positive: Fitch believes Crown's longer-term ratings have upward potential from further operational and credit profile improvements. In the 2015 - 2016 timeframe, Crown has indicated the potential for a REIT conversion. Future developments that may, individually or collectively, lead to Fitch taking a positive rating action include: -- The stability and operating leverage within its leasing operations; -- Growth in broadband data leading to increased lease-up opportunities; -- Maintaining less aggressive financial policies than in the past; and -- If Crown continues to following the potential path of a REIT conversion and materially de-levers the company. CROWN CASTLE: Moody's Affirms 'Ba2' Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service has assigned a Baa3 rating to Crown Castle International Corp.'s proposed $1.5 billion senior secured notes (5-year and 10-year tranches) to be issued by CC Holdings GS V LLC ("GS V"), a wholly-owned operating subsidiary. In addition, Moody's affirmed the Ba2 ratings on the existing bank credit facilities residing at Crown Castle Operating Company ("CCOC"), which consists of a $500 million Term Loan A due 2017, $1.6 billion Term Loan B due 2019 and $1 billion secured revolving credit facility due 2017. Moody's also affirmed Crown Castle's Corporate Family Rating (CFR) and Probability of Default Rating (PDR), both at Ba2, as well as the B1 ratings on the existing unsecured notes issued by Crown Castle. Finally, Moody's lowered Crown Castle's Speculative Grade Liquidity Rating to SGL-2 from SGL-1. The rating outlook is stable. New issue proceeds will be used to repay the $830 million outstanding 9% senior unsecured notes due January 2015 (rated B1) and $965 million outstanding 7.75% senior secured notes due May 2017 (rated Baa2). Since the transaction is neutral to Crown Castle's credit profile, the CFR and PDR remain unchanged. However, because the financing significantly increases the proportion of senior secured debt at GS V relative to debt residing at Crown Castle (the parent entity where the most junior debt in the capital structure resides), the new GS V obligations are rated one notch lower than the existing GS V debt. This reflects the higher loss absorption that this class of debt will sustain relative to the reduced liabilities at Crown Castle in a distressed scenario under Moody's Loss Given Default (LGD) Methodology. The downgrade of the liquidity rating to SGL-2 reflects Moody's view that Crown Castle's recent draw of $750 million (estimated) to fund the T-Mobile acquisition, represents considerable utilization of the revolver and reduces the company's access to committed external liquidity. Rating Assigned: Issuer: CC Holdings GS V LLC $500 Million Senior Secured Notes due 2017 -- Baa3 (LGD-2, 23%) $1.0 Billion Senior Secured Notes due 2023 -- Baa3 (LGD-2, 23%) Ratings Affirmed: Issuer: CC Holdings GS V LLC $965 Million 7.75% Senior Secured Notes due 2017 -- Baa2 (LGD- 2, 11%) Issuer: Crown Castle Operating Company $3.1 Billion Senior Secured Credit Facilities with various maturities -- Ba2, LGD assessment revised to (LGD-4, 60%) Issuer: Crown Castle International Corp. Corporate Family Rating -- Ba2 Probability of Default Rating -- Ba2 $830 Million 9% Senior Unsecured Notes due 2015 -- B1 (LGD-5, 89%) $500 Million 7.125% Senior Unsecured Notes due 2019 -- B1, LGD assessment revised to (LGD-6, 91%) $1.65 Billion 5.25% Senior Unsecured Notes due 2023 -- B1, LGD assessment revised to (LGD-6, 91%) Rating Downgraded: Issuer: Crown Castle International Corp. Speculative Grade Liquidity Rating to SGL-2 from SGL-1 The assigned ratings are subject to review of final documentation and no material change in the size, terms and conditions of the transaction as advised to Moody's. Upon redemption of the 9% senior unsecured notes and 7.75% senior secured notes Moody's will withdraw the ratings. Ratings Rationale Crown Castle's Ba2 Corporate Family Rating (CFR) reflects management's use of the company's solid business profile, stable and predictable revenue steam, modest capital intensity and significant free cash flow generation to sustain a somewhat aggressive capital structure that has supported debt-financed growth and shareholder returns. Pro forma for the recent acquisition of tower assets from T-Mobile and the contemplated refinance transaction, Moody's estimates total debt to LTM EBITDA leverage (includes Moody's standard adjustments and T-Mobile LTM EBITDA) will increase to approximately 7.8x compared to 6.7x at September 30, 2012. While this is somewhat higher than the 7.5x downgrade trigger that Moody's has previously articulated, the ratings assessment is based on leverage returning to a range of 6.7x to 7.3x by year end 2013 from a combination of EBITDA expansion and repayment of revolver borrowings. Rating Outlook The rating outlook is stable, reflecting Crown Castle's solid operating performance, visible revenue growth via a significant backlog of contractual rents and increasing wireless carrier demand. The stable outlook also reflects Moody's expectations of continued EBITDA and cash flow expansion that will support improvement in the company's credit profile and leverage metrics over the rating horizon. To the extent deleveraging is delayed beyond Moody's expected timeframe, ratings would likely experience downward pressure. What Could Change the Rating - DOWN The ratings may face downward ratings pressure if weakening industry fundamentals, a return to more aggressive financial policies (e.g., return of capital to shareholders via share repurchases) or lower-than-expected cash flow growth result in the following Moody's adjusted key credit metrics on a sustained basis: total debt to EBITDA approaching 7.5x, (EBITDA- Capex)/Interest trending under 1.5x and free cash flow to adjusted total debt in the low single digits. What Could Change the Rating - UP Despite the increase in leverage resulting from the pending T- Mobile acquisition, Moody's expects the de-leveraging trend to continue, and further upward ratings migration would be dependent upon Crown Castle allocating a significant portion of free cash flow generation towards absolute debt reduction. Quantitatively, upwards rating pressure may develop if Crown Castle manages its capital structure to the following Moody's adjusted key credit metrics on a sustained basis: total debt to EBITDA trending towards 6x, (EBITDA-Capex)/Interest exceeding 2x and free cash flow to adjusted total debt in the high single digits. The principal methodology used in rating Crown Castle International Corp. was Global Communications Infrastructure Industry Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. With headquarters in Houston, Texas, Crown Castle International Corp., through its wholly-owned operating subsidiaries, is the largest independent operator of wireless tower assets in the US offering wireless communications coverage in 92 of the top 100 US markets. The firm derives approximately 88% of its revenue by leasing site space on its approximately 30,000 towers and 1,700 distributed antenna systems (DAS) networks in the US and Australia to wireless service providers, with the remaining revenue derived from its services business, which provides network services relating to sites or wireless infrastructure for customers. Revenue was approximately $2.3 billion for the twelve months ended September 30, 2012. CYPRESS POINT: Voluntary Chapter 11 Case Summary ------------------------------------------------ Lead Debtor: Cypress Point, LLC 900 Cypress Pointe Dr Crown Point, IN 46307 Bankruptcy Case No.: 12-24556 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Northern District of Indiana (Hammond Division) Judge: J. Philip Klingeberger Debtor's Counsel: K.C. Cohen, Esq. 151 N. Delaware Street, Ste 1104 Indianapolis, IN 46204-2573 Tel: (317) 715-1845 E-mail: kc@esoft-legal.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 Affiliate that simultaneously filed separate Chapter 11 petition: Debtor Case No. ------ -------- Cypress Point II, LLC 12-24557 Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 The petitions were signed by Nick Kozul, president. Cypress Point each did not file a list of its largest unsecured creditors together with its petition. DECODE GENETICS: Amgen to Acquire Business in $415 Million Deal --------------------------------------------------------------- Amgen Inc. and deCODE Genetics on Dec. 10 said the companies have entered into a definitive agreement under which Amgen will acquire deCODE Genetics, a global leader in human genetics, headquartered in Reykjavik, Iceland. The all-cash transaction values deCODE Genetics at $415 million, subject to customary closing adjustments, and was unanimously approved by the Amgen Board of Directors. "deCODE Genetics has built a world-class capability in the study of the genetics of human disease," said Robert A. Bradway, president and CEO at Amgen. "This capability will enhance our efforts to identify and validate human disease targets. This fits perfectly with our objective to pursue rapid development of relevant molecules that reach the right disease targets while avoiding investments in programs based on less well-validated targets." Founded in 1996, deCODE Genetics is a global leader in analyzing and understanding the link between the genome and disease susceptibility. Using its unique expertise and access to a well- defined population in Iceland, deCODE Genetics has discovered genetic risk factors for dozens of diseases ranging from cardiovascular disease to cancer. "One of the ways to truly realize the full value of human genetics, is to make our research synergistic with drug development efforts where target discovery, validation and prioritization efforts can be accelerated," said Kari Stefansson, M.D., Dr. Med., founder and CEO at deCODE Genetics. "We believe Amgen's focus and ability to incorporate our genetic research into their research and development efforts will translate our discoveries into meaningful therapies for patients." This transaction does not require regulatory approval, and is expected to close before the end of 2012. Based in Thousand Oaks, Calif., Amgen (NASDAQ:AMGN) -- http://www.amgen.com/-- is a biotechnology pioneer since 1980. About deCODE Genetics deCODE Genetics Inc., nka DGI Resolution, Inc., sought chapter 11 protection (Bankr. D. Del. Case No. 09-14063) on Nov. 16, 2009, disclosing $69.9 million in assets and $314 million in liabilities, and represented by lawyers at Richards, Layton & Finger, P.A., in Wilmington, Del. The bankruptcy court confirmed a liquidating chapter 11 plan on May 27, 2010. That plan estimated that unsecured creditors would recover about 3% on their prepetition claims, and appointed Walker, Truesdell, Roth & Associates as the liquidating trustee. The liquidating trustee is represented by lawyers at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Del. DELTA AIR: Virgin Investment No Impact on Moody's 'B2' Rating ------------------------------------------------------------- Moody's Investors Service says that the planned purchase by Delta Air Lines, Inc. (B2 stable, "Delta") of the 49% stake in Virgin Atlantic Airways Ltd. ("Virgin", unrated) held by Singapore Airlines ("Singapore", unrated) for $360 million is positive for Delta's operations and credit profile. Delta Air Lines, Inc., headquartered in Atlanta, Georgia, is the world's second largest airline, providing scheduled air transportation for passengers and cargo throughout the U.S. and around the world. DICKINSON THEATRES: Spirit Entitled to Attorneys' Fees ------------------------------------------------------ Kansas Bankruptcy Judge Dale L. Somers dealt another setback to Dickinson Theatres, Inc., overruling the Debtor's objection to a landlord's claim for attorneys' fees as part of the cure amount due the landlord prior to assumption of a master lease. Spirit Master Funding, LLC and Spirit Master Funding IV, LLC, which objected to the confirmation of Dickinson Theatres' First Amended and Restated Plan of Reorganization, contended it would be entitled to payment of attorneys' fees and costs incurred from the date of filing to the effective date of the plan in order for the Debtor to assume the Master Lease. At the confirmation hearing held on Nov. 28, 2012, the Debtor disputed the amount of that claim. Spirit has not submitted a claim for a specific amount, since it continues to incur fees and costs as litigation regarding the Debtor's attempt to assume the Master Lease in part has not concluded. But at the confirmation hearing, counsel for Spirit presented the Court and the Debtor's counsel with a pro forma statement for fees and expenses incurred from Oct. 2, 2012 through Nov. 27, 2012. The Debtor objected to the reasonableness of the fees based upon two factors: (1) that there should be adjustments for items such as travel time, excessive time spent of particular matters, and inappropriate descriptions of time; and (2) that the hourly rates charged should be local Kansas City rates rather than the rates customarily charged by Spirit's counsel, who are attorneys practicing in the Chicago office of a nationwide firm. The Debtor did not offer any evidence to support its positions, resting instead upon arguments at the hearing and in its subsequently filed brief. In his ruling, Judge Somers said he declines to adjust specific time entries on the pro forma statement provided to the Court. The Debtor has identified no entries which it asserts are unreasonable. The Court has carefully reviewed the entries and has found no reason to disallow any portion of the time recorded. Rather, Spirit's counsel appears to have represented their client efficiently and effectively. Through the Master Lease, Dickinson leases from Spirit four properties on which it operates some of its movie theaters; three of those locations are highly profitable, but the fourth, Palm Valley, is not. On Sept. 21, 2012, Dickinson filed a motion to reject a portion of the Master Lease concerning Palm Valley. Spirit objected. On Oct. 12, the Court issued its opinion and judgment denying the Debtor's request. On Oct. 26, Dickinson filed a notice of appeal from that order to the Bankruptcy Appellate Panel of the Tenth Circuit. The appeal is pending. The Debtor's Plan attempts to preserve the Debtor's appeal. According to Judge Somers, the Debtor's motion to reject the Master Lease in part presented an issue of critical importance to Spirit, a public company whose business involves sale/leaseback real estate financing. Spirit contends that a "determination that a central feature of the Spirit master lease [with Debtor] was unenforceable would have threatened key aspects of Spirit's contractual relationships with nearly all of its tenants. The Court also declines to order that compensation should be based upon Kansas City rather than Chicago hourly rates. Judge Somers held that, by contending that Spirit's attorneys' fees claim should be based upon Kansas City rates rather than Chicago rates, the Debtor is indirectly questioning Spirit's choice of counsel. The Court finds this challenge unreasonable. A copy of the Court's Dec. 10, 2012 Memorandum Opinion and Order is available at http://is.gd/chsM9Yfrom Leagle.com. Overland Park, Kansas-based Dickinson Theatres, Inc., which is engaged in the movie theater business in multiple locations, filed for Chapter 11 protection (Bankr. D. Kan. Case No. 12-22602) on Sept. 21, 2012. Judge Dale L. Somers presides over the case. Sharon L. Stolte, Esq., at Stinson Morrison & Hecker L.L.P., represents the Debtor. The Debtor disclosed assets of $2,198,081, and liabilities of $7,617,413. On Dec. 4, 2012, Judge Somers denied confirmation of Dickinson Theatres' Plan. The Dec. 10 edition of the Troubled Company Reporter ran a story on the Plan ruling. EDUCATION MANAGEMENT: S&P Cuts CCR to 'B-' on Tighter Regulations ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Pittsburgh, Pa.-based for-profit post-secondary school operator Education Management LLC to 'B-' from 'B'. The rating outlook is negative. "At the same time, we lowered the issue-level rating on the company's senior secured credit facilities to 'B-' (at the same level as the 'B-' corporate credit rating on the company), from 'B', in accordance with our notching criteria for a '3' recovery rating, reflecting our expectation for meaningful (50% to 70%) recovery for lenders in the event of default. We also lowered our issue-level rating on the company's senior unsecured and subordinated notes to 'CCC' from 'CCC+', in conjunction with the corporate credit rating change. The recovery rating on this debt remains at '6', signifying our expectation for negligible (0% to 10%) recovery," S&P said. "The downgrade reflects our expectation that tough economic conditions and new business practices mandated by tighter regulation will cause ongoing enrollment declines over the near term," said Standard & Poor's credit analyst Chris Valentine. "We lowered our previous expectations for revenue, EBITDA, and cash flow based on the near-term outlook for the for-profit education sector in a weak economy. Given the fixed costs of the business, we expect enrollment declines will lead to weaker credit metrics, lower cash flow generation, and tight financial covenants over the next 12 to 18 months. There is also a springing maturity to the senior secured credit facilities, which would be accelerated to March 1, 2014, if the company does not refinance or repay its $375 million notes due June 2014 prior to this date," S&P said. "Our 'B-' rating reflects Education Management's dependence on Title IV federal student loan programs and students' willingness to take on debt despite weak economic conditions and high unemployment. We expect the company's revenue and EBITDA trends to remain under significant pressure in fiscal-year 2013 and potentially beyond, as changes in marketing practices, negative publicity, difficulty in obtaining financial aid, and increased disclosure requirements to potential students hurt enrollments. We view Education Management's business risk profile as 'vulnerable' because of the severe pressure of regulatory risk on its good market position and business fundamentals. We assess the company's financial risk profile as 'highly leveraged,' because we expect debt leverage above 5x and minimal discretionary cash flow generation relative to total debt levels. Our governance assessment is 'fair,'" S&P said. Education Management is one of the leading for-profit, post- secondary education providers, offering both traditional and online programs in career-oriented disciplines. The company directly or indirectly derived 85% of its fiscal-year 2012 net revenues from Title IV funding. "We consider this high exposure to federal student lending as a long-term risk for the company because legislative or regulatory actions that result in a substantial reduction in funding significantly hurt its profits. Crucial issues relate to the adverse consequences of the elimination of the safe harbor provision on incentive compensation for schools' student recruiters. In addition, it is now more difficult for some students to qualify for federal funding, based on their family credit histories. In June 2012, a U.S. District Court vacated possible rules that would limit the amount of student debt that students can incur to a level that could be supported with their employment prospects. However, the potential for future legislation or regulation remains a key risk to the rating," S&P said. ELDORADO GOLD: S&P Rates New $600MM Senior Unsecured Notes 'BB' --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' issue-level rating to Vancouver-based gold producer Eldorado Gold Corp.'s US$600 million senior unsecured notes. "We understand that the proceeds from the unsecured notes will be used for general corporate purposes," said Standard & Poor's credit analyst George Economou. Standard & Poor's also affirmed its 'BB' long-term corporate credit rating on Eldorado. The outlook is stable. "The rating on Eldorado reflects what we view as the company's credit strengths, which include its low pro forma debt levels, better-than-average cost position, strong credit measures amid high contemporary metals prices, and expanding production profile," Mr. Economou added. "These strengths are somewhat offset, we believe, by the company's exposure to volatile commodity prices, limited operating diversity, and the execution risks surrounding its collection of growth projects," S&P said. "Eldorado operates five gold mines in Turkey and China, a polymetallic mine in Greece, and an iron ore mine in Brazil. It is also developing multiple gold projects within its existing operating regions, as well as in Romania," S&P said. "The stable outlook reflects our view that Eldorado's low-cost production base should support steady FFO generation as well as help maintain an adequate liquidity position during a multiyear period of heightened capital spending. Assuming gold prices remain consistent with our base case operating scenario, in the next several years we expect the company to generate a rolling 12-month FFO of about US$400 million with an adjusted FFO-to-debt ratio above 60%," S&P said. "We could lower the rating if Eldorado's mining costs and gold prices meaningfully deteriorate to levels where negative free operating cash flow rapidly escalates, straining the company's adequate liquidity position. This could occur if the company's gold margins shrink to less than US$600 per ounce and capital spending costs meaningfully escalate, driving adjusted FFO to debt below 50%, likely causing free cash burn above US$700 million in 2013," S&P said. A positive rating action is unlikely through next year, given the execution risks surrounding the concurrent development of multiple growth projects. However, one could occur if the company makes faster-than-expected construction progress on its development projects while maintaining its significant financial risk profile. EURAMAX INT'L: Moody's Cuts CFR/PDR to 'Caa2'; Outlook Stable ------------------------------------------------------------- Moody's Investors Service downgraded Euramax International, Inc.'s corporate family rating and probability of default rating to Caa2 from Caa1. The company's other existing debt ratings were also downgraded -- refer to the list below. The outlook remains stable. The following rating actions were taken: Corporate Family Rating, downgraded to Caa2 from Caa1 Probability of Default Rating, downgraded to Caa2 from Caa1 $375 million senior secured notes due 2015, downgraded to Caa2 (LGD4, 51%) from Caa1 Ratings Rationale The downgrade reflects Moody's expectation that the turmoil in global financial markets and weakness in Europe will continue to hamper Euramax's revenues and operating margins as well as weaken key credit metrics. Moody's expects sustained weak profitability to diminish the company's free cash flow generation over the next 12 to 18 months, which may continue to increase usage on the revolving credit facility. Expectations for only moderately higher revenues, continued softness in operating margins and no significant reduction in balance sheet debt point to elevated adjusted debt leverage in excess of 8.0x over the next 12 to 18 months. The Caa2 corporate family rating considers the company's elevated adjusted debt leverage of approximately 14.4x debt-to-EBITDA, adjusted interest coverage below 1.0x, and weakening operating margins. (In arriving at EBITDA, Moodys includes non-cash foreign exchange losses which result from translating inter-company obligations between the company's US and foreign businesses). In addition, the rating reflects Moody's expectations for a slow recovery in the residential repair and remodeling and non- residential construction markets, exposure to commodity price volatility, and on-going uncertainty about the Euro Zone. The rating also takes into consideration the limited ability to reduce long-term debt, due largely to expectations for weak free cash flow generation over the next 12 to 18 months. However, the lack of significant debt maturities until 2015 supports the company's liquidity and gives it time to work toward restoring operating profitability. The ratings may be upgraded if the company is able to show improvement in operating margins such that adjusted EBITA margin improves to at least mid-single digits on an annual basis, adjusted EBITA-to-interest expense approaches 2.0x, and adjusted debt-to-EBITDA falls below 6.5x. The ratings may come under pressure if adjusted EBITA-to-interest expense falls below 0.5x or if the company is unable to achieve adjusted debt-to-EBITDA less than 8.0x. Also, if the company remains unable to meet its springing fixed charge coverage covenant in the event that availability under the revolver approaches the minimum threshold, the ratings could be affected. The principal methodology used in rating Euramax was the Global Manufacturing Industry Methodology published in December 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Norcross, Georgia, Euramax International, Inc. is an international producer of value-added aluminum, steel, vinyl and fiberglass products. For the 12 months ended September 30, 2012, the company generated revenues of $861 million and a net loss of approximately $50 million. FAIRWEST ENERGY: Obtains Initial Order Under CCAA ------------------------------------------------- FairWest Energy Corporation has obtained an Initial Order on Dec. 12, 2012 from the Court of Queen's Bench of Alberta granting relief to FairWest under the Companies' Creditors Arrangement Act ("CCAA") and appointing PricewaterhouseCoopers Inc. as the monitor (the "Monitor"). The terms and conditions of a restructuring plan have not yet been determined. The Initial Order provides that the operations of FairWest may continue as usual and that FairWest management will remain responsible for the day to day operations of FairWest. The Initial Order further provides that from and after the filing date, obligations to employees, consultants, agents, experts, accountants, counsel and other such persons can be met in the ordinary course and all reasonable expenses incurred by FairWest in carrying out its business in the ordinary course can be paid. In conjunction with this application, the Company obtained authorization and approval to enter into a commitment letter with Supreme Group Inc. (the "DIP Lender") for the provision of debtor- in-possession financing in the maximum amount of $700,000 and a court ordered charge ranking senior in priority to existing security interests to secure the Company's obligations to the DIP Lender under such financing. While FairWest is under CCAA protection, all proceedings against it by its creditors are stayed. The Initial Order grants FairWest creditor protection under the CCAA for an initial period which expires on Jan. 11, 2013. The Monitor will monitor the property, business and financial services of FairWest pursuant to the CCAA. About FairWest Energy FairWest is a Calgary, Alberta based junior oil and gas company engaged in the acquisition, exploration, development and production of crude oil, natural gas and natural gas liquids in the provinces of Alberta and Saskatchewan. FASTBUCKS HOLDING: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: FastBucks Holding Corporation 7920 Belt Line Road, Suite 600 Dallas, TX 75254 Tel: (214) 954-4135 Bankruptcy Case No.: 12-37793 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Hirtzan Joseph Acosta, Esq. LOOPER REED & MCGRAW, P.C. 1601 Elm Street, Suite 4100 Dallas, TX 75201 Tel: (214) 954-4135 Fax: (214) 953-1332 E-mail: jacosta@lrmlaw.com - and ? Micheal Wayne Bishop, Esq. LOOPER, REED & MCGRAW, P.C. 1601 Elm Street, Suite 4600 Dallas, TX 75201 Tel: (214) 954-4135 Fax: (214) 953-1332 E-mail: mbishop@lrmlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Charles Horton, president. Affiliates that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- FastBucks, Inc. 12-37794 FastBucks Wage and Benefits,LLC 12-37795 FastBucks of Alamogordo, New Mexico, LLC 12-37796 FastBucks of Gallup, New Mexico, LLC 12-37797 FastBucks of Las Vegas, New Mexico, LLC 12-37798 FastBucks of Rio Rancho, New Mexico, LLC 12-37799 FastBucks of Roswell, New Mexico,LLC 12-37800 FL.INVEST: Case Summary & 7 Largest Unsecured Creditors ------------------------------------------------------- Debtor: FL.Invest.USA Inc. aka FL. Invest USA, Inc. aka FL Invest USA, Inc. 112 Capitol Trail Newark, DE 19711 Bankruptcy Case No.: 12-13295 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court District of Delaware (Delaware) Judge: Kevin J. Carey Debtor's Counsel: Ryan M. Ernst, Esq. O'KELLY ERNST & BIELLI, LLC 901 N. Market Street Suite 1000 Wilmington, DE 19801 Tel: (302) 778-4000 Fax: (302) 295-2873 E-mail: rernst@oeblegal.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its seven largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/deb12-13295.pdf The petition was signed by Mark Marinzoli, director. FOUNTAIN PARK: Case Summary & 15 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Fountain Park, LLC 6416 Pacific Hwy E Fife, WA 98424-1561 Bankruptcy Case No.: 12-48271 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Paul B. Snyder Debtor's Counsel: Brett L. Wittner, Esq. KENT & WITTNER PS 4301 S Pine Ste 629 Tacoma, WA 98409 Tel: (253) 473-7200 E-mail: brett@kentwittnerlaw.com Scheduled Assets: $7,624,020 Scheduled Liabilities: $14,011,483 A copy of the Company's list of its 15 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb12-48271.pdf The petition was signed by Thomas W. Price, member of Prium Companies, LLC. Affiliates that previously sought Chapter 11 protection: Petition Debtor Case No. Date ------ -------- ---- Hyun J. Um 10-46731 08/17/2010 Thomas W. Price 10-46732 08/17/2010 Hanna Heights, LLC 12-46098 08/31/2012 FRONTLINE TECHNOLOGIES: Commences Restructuring Under BIA --------------------------------------------------------- Frontline Technologies Inc. disclosed that, after consideration of all viable alternatives, it is in the best interests of Frontline Technologies and its stakeholders for Frontline Technologies to commence restructuring proceedings under the Bankruptcy and Insolvency Act ("BIA"). Accordingly, on Tuesday, Dec. 11, 2012, Frontline Technologies filed a notice of intention to make a proposal under the BIA with the Official Receiver. The Notice of Intention has granted Frontline Technologies BIA protection for an initial period of 30 days, expiring on Jan. 10, 2013. While under protection, creditors and others are stayed from enforcing any rights against Frontline Technologies, giving Frontline Technologies the opportunity to pursue restructuring alternatives. Frontline Technologies' subsidiary, Frontline Technologies Corporation, which offers IT infrastructure support and managed services, also filed a notice of intention to make a proposal under the BIA on Tuesday, Dec. 11, 2012. The Subsidiary's normal day-to-day IT infrastructure operations are expected to continue without interruption. Frontline Technologies' liquidity position has deteriorated as a result of various factors, including, but not limited to, negative cash flow from operations, an inability to secure additional sources of financing and increasing pressure to make payments to its creditors. The BIA restructuring proceedings will allow Frontline Technologies and the Subsidiary to deal decisively with their cost and debt burdens and to narrow their strategic focus in an effective and timely manner. Frontline Technologies made this decision with the unanimous approval of its Board of Directors after thorough consultation with its advisors and extensive consideration of all other alternatives. Frontline Technologies has developed a plan to wind-down its trading platform business while it transitions its customers on an expedited basis to new service providers. The wind down process may include speaking to parties interested in acquiring the trading platform business. Pursuant to the Notices of Intention, Duff & Phelps Canada Restructuring Inc. has been appointed as proposal trustee that will monitor the ongoing operations of Frontline Technologies and of the Subsidiary while under BIA protection (in such capacities, the "Trustee"). GRAPHIC PACKAGING: S&P Affirms 'BB+' Corporate Credit Rating ------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its ratings, including the 'BB+' corporate rating, on Atlanta, Ga.-based Graphic Packaging International Inc. (Graphic Packaging). The rating outlook is stable. "We also assigned our 'BBB' issue-level ratings to the company's proposed $300 million senior secured incremental term loan. The recovery rating is '1', reflecting our expectation that lenders can expect to achieve very high (90% to 100%) recovery in the event of a payment default," S&P said. Proceeds from the proposed term loan are to be used to repurchase and cancel stock of Graphic Packaging Holding Co. "The ratings affirmation reflects our expectation that Graphic Packaging will be able to maintain its 'significant' financial risk profile despite a modest increase in debt following the announced acquisitions and proposed share repurchase," said Standard & Poor's credit analyst Tobias Crabtree. "Specifically, we forecast annual free cash flow in excess of $200 million in 2013 and 2014 and leverage declining to 3x over this period from about 4x pro forma following the proposed transactions. In addition, we view the acquisitions, share repurchase, and incremental debt as not deviating substantially from management's stated financial policy, which we view as consistent with a significant financial risk profile." "The ratings on Graphic Packaging reflect the combination of what we consider to be its 'satisfactory' business risk and significant financial risk profiles. We expect further leverage reduction from free cash flow to result in leverage in the mid-3x area and funds from operations (FFO) of about 20% at the end of 2013. We view these credit metrics as consistent with the rating and our assessment of the company's significant financial risk profile. Our satisfactory business risk profile reflects our view of the company's long-term customer relationships, position as the largest North American producer of folding cartons with 32% market share, and its value-added product mix. The ratings also incorporate our expectations for no additional large debt-financed acquisitions, share repurchases, or dividends to its concentrated shareholder base," S&P said. "The rating outlook is stable. We expect Graphic Packaging to continue to generate relatively steady earnings and sizeable free cash flow and remain committed to modest debt reduction, so that credit measures remain in line with the ratings. Based on our EBITDA projections, we expect free cash flow generation to be $200 million or more in each of the next two years, leverage to approximate 3.5x, and FFO to debt to be about 20% by the end of 2013. We view these credit measures as consistent with the 'BB+' corporate credit rating, given the company's satisfactory business risk profile," S&P said. "For a higher rating, our assessment of Graphic Packaging's financial risk would need to improve to 'intermediate' from 'significant,' based on its satisfactory business risk profile. This could occur if leverage was sustained at or below 3x and FFO to debt above 30% and we viewed the company's financial policy as consistent with a low-investment-grade rating. For this to occur, earnings would have to improve more than 15% from our 2013 EBITDA forecast and stay at that level, which we view as unlikely given our cautious economic outlook. In addition, for a higher rating we would have to anticipate that the company would finance any potential dividends, share repurchases or acquisitions such that credit metrics remained consistent with an intermediate profile," S&P said. "We could lower the rating if free cash flow were to significantly decline or be used for other activities, such as excessive shareholder rewards, large acquisitions, or initiatives, causing leverage to remain above 4x, with FFO to debt in the mid-teen percentage area. This could occur with minimal debt reduction and if EBITDA were to decline 15% from our 2013 forecast and stay at that level," S&P said. HAWAII MEDICAL: Hires Reid Collins as Litigation Counsel -------------------------------------------------------- Hawaii Medical Center et al., are hiring Reid Collins & Tsai LLP as special litigation counsel. The Debtors seek authority to compromise or settle claims without Court approval where the claim is pursued by RCT and the amount in controversy is less than $100,000. The Debtor claims in which the amount in controversy is greater than $100,000 will be submitted to the Court for approval in accordance with Federal Rule of Bankruptcy Procedure 9019. RCT will receive a contingent fee on recoveries obtained for the Debtors and reimbursement of expenses. RCT will receive a 35% contingency fee on any gross recoveries obtained, along with reimbursement of expenses of up to $50,000, paid from recoveries obtained. P. Jason Collins, a partner of RCT, attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Hawaii Medical Center The Hawaii Medical Center, along with its affiliates, filed for Chapter 11 bankruptcy (Bankr. D. Hawaii Lead Case No. 11-01746) on June 21, 2011, just a year after exiting court protection. Hawaii Medical Center owns two hospital campuses -- HMC East in North Honolulu and HMC West in Ewa Beach. The two hospitals have 342 licensed beds and have a total of more than 1,000 employees. The hospitals were known as St. Francis Medical Center before Hawaii Medical purchased the hospitals in 2007. Judge Robert J. Faris presides over the 2011 case. Lawyers at Moseley Biehl Tsugawa Lau & Muzzi, in Honolulu, Hawaii, and McDonald Hopkins LLC, in Cleveland, Ohio, serve as the Debtors' counsel. The Debtors' financial advisors are Scouler & Company, LLC. In its petition, Hawaii Medical Center estimated $50 million to $100 million in assets and $100 million to $500 million in debts. The petitions were signed by Kenneth J. Silva, member of the board of directors. Attorneys at Wagner Choi & Verbrugge, in Honolulu, Hawaii, and Pachulski Stang Ziehl & Jones LLP, in Los Angeles, represent the Official Committee of Unsecured Creditors as counsel. The Debtors' prepetition debt structure is comprised of (i) the Prepetition Revolving Loan with MidCap Financial, LLC, and the Prepetition Term Loan with St. Francis Healthcare Systems of Hawaii. As of the Petition Date, the aggregate outstanding principal on the Prepetition MidCap Revolving Loan and the Prepetition St. Francis Term Loan is $46,851,772. The principal balance of the Prepetion MidCap Revolving Loan is $7,676,495. The amount owed under the Prepetition St. Francis Term Loan is $39,175,277, secured by St. Francis's first priority lien on, among other things, all real property of the Debtors. Through the Chapter 11 filing, the Debtors plan to return the hospitals to the control of St. Francis. In the prior case, HMC and its affiliated debtors were converted to new, Hawaii non-profit corporations. CHA Hawaii, one of HMC's affiliated debtors and a subsidiary of Cardiovascular Hospitals of America LLC, discontinued management of the reorganized Debtors. Wichita, Kansas-based CHA Hawaii LLC, and its affiliates -- including Hawaii Medical Center LLC -- filed for Chapter 11 protection on Aug. 29, 2008 (Bankr. D. Del. Case No. 08-12027). Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP represented the Debtors in their restructuring efforts. CHA Hawaii estimated assets of up to $10 million and debts between $50 million and $100 million when it filed for bankruptcy. The Debtors obtained confirmation of their Chapter 11 plan in May 2010 and emerged from bankruptcy in August 2010. The Debtor disclosed $74,713,475 in assets and $91,599,563 in liabilities as of the Chapter 11 filing. HOSTESS BRANDS: Wants Control of Liquidation Case Until May 2013 ---------------------------------------------------------------- Hostess Brands, Inc. and its five domestic direct and indirect subsidiaries will appear before the Bankruptcy Court at a hearing Dec. 21 to seek an extension of their exclusive periods to file and solicit acceptances of a bankruptcy plan. The Court's second extension order in August stretched the Debtors' exclusive period to file a plan to Nov. 6, and the deadline to secure plan votes to Jan. 7. On Oct. 10, prior to the expiration of the Exclusive Filing Period, the Debtors filed the Joint Plan of Reorganization and Disclosure Statement, which contemplated a stand-alone restructuring of the Debtors' businesses with the Debtors emerging from bankruptcy post- confirmation as operating entities. The Plan was premised upon the Debtors' ability to implement modifications to their collective bargaining agreements with their unions. The Debtors recounted that the strikes by the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union early November resulted in material impairment of their operations and, eventually, a complete shutdown of operations. The Debtors determined that the emergence of the Debtors from bankruptcy on a going concern basis is no longer possible. On Nov. 29, the Debtors obtained final court approval to pursue an orderly winddown of their businesses and the sale of substantially all of their assets in chapter 11. Hostess now wants the Court to extend the Exclusive Filing Period by 120 days, through and including March 6, 2013; and the Exclusive Solicitation Period through and including May 6, 2013. "The direction of the Debtors' chapter 11 cases has fundamentally changed since the Court signed the Second [Exclusivity] Extension Order," Hostess said in court papers. Hostess said it is unable at this time to determine whether or not the Debtors are administratively solvent. "Thus, it is unclear if they will be able to propose a liquidating plan that proposes payment of all outstanding administrative claims, but it is possible. However, even if the Debtors prove to be administratively insolvent, there remains the prospect of confirmation of a liquidating plan in these chapter 11 cases to the extent administrative creditors agreed to compromise their claims," Hostess said. Since the Debtors ceased operations on Nov. 16, numerous potential purchasers have reached out to the Debtors' investment banker, Perella Weinberg Partners, LP, to express interest in acquiring the Debtors' brands, bakeries and other assets. In response, the Debtors and their advisors have initiated an aggressive process to market their assets and develop a strategic plan to maximize value. The Debtors established a preliminary bid deadline of Dec. 10 and expect that most stalking horse purchase agreements that will be executed will be executed in January and February 2013, with auctions held in February and March of 2013 and thereafter. "This timing suggests that, while the picture will become clearer over time, the Debtors will not have a good sense of the proceeds that the asset sale process will bring until early next year. This timing explains the Debtors' request that the Exclusive Filing Period be extended into March 2013, as the Debtors do not desire to prepare a liquidating plan if the sale process ultimately demonstrates that confirmation of such a plan is not likely feasible," Hostess said. 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. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. 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). In the new Chapter 11 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. The official committee of unsecured creditors 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. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. The bankruptcy judge signed a formal order on Nov. 30 giving final approval to wind-down procedures. The latest budget projects the $49 million loan for the Chapter 11 case being paid down to $21.2 million by Feb. 22. HOSTESS BRANDS: Lewis Brothers Hires Schiff Hardin as Lawyers ------------------------------------------------------------- Lewis Brothers Bakeries Inc. has hired itself a lawyer and filed a notice of appearance and demand for service of papers in Hostess Brands bankruptcy case. Lewis is being represented by: J. Mark Fisher, Esq. Catherine Masters, Esq. Michael Ott, Esq. SCHIFF HARDIN LLP 233 South Wacker Drive, Suite 6600 Chicago, IL 60606 Tel: 312-258-5500 E-mail: mfisher@schiffhardin.com cmasters@schiffhardin.com mott@schiffhardin.com - and - Louis T. DeLucia, Esq. SCHIFF HARDIN LLP 666 Fifth Avenue New York, NY 10103 Tel: 212-753-5000 Fax: 212-753-5044 E-mail: Ldelucia@schiffhardin.com Lewis Bakeries -- http://www.lewisbakeries.net/-- headquartered in Evansville, Indiana, and with additional bakeries in Murfreesboro Tennessee, Ft. Wayne, LaPorte and Vincennes, Indiana, is one of the few remaining independent bakeries in the Midwest and the largest wholesale bakery in Indiana, according to its Web site. Strikes by the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union early November resulted in material impairment of Hostess' operations and, eventually, a complete shutdown of operations. On Nov. 29, the Debtors obtained final court approval to pursue an orderly winddown of their businesses and the sale of substantially all of their assets in chapter 11. 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. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. 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). In the new Chapter 11 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. The official committee of unsecured creditors 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. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. The bankruptcy judge signed a formal order on Nov. 30 giving final approval to wind-down procedures. The latest budget projects the $49 million loan for the Chapter 11 case being paid down to $21.2 million by Feb. 22. HOSTESS BRANDS: Employees File Class Suit Over WARN Act Violations ------------------------------------------------------------------ William Dean, Robert Gregory, Henry Dini, Fred Shourds, and Michael Jablonowski, on behalf of themselves and other similarly situated individuals, commenced a class action against Hostess Brands, Inc., IBC Sales Corporation, IBC Services, LLC, IBC Trucking, LLC, Interstate Brands Corporation, and MCF Legacy, Inc., for violations of the Worker Adjustment and Retraining Notification Act, 29 U.S.C. Sec. 2101 et seq.. Dean et al. seek to recover 60 days of wages and benefits from Hostess for Class Members who were terminated without cause as part of plant closings or mass layoffs ordered by Hostess without the notice required by the WARN Act. The Plaintiffs argued their post- petition claims for wages under the WARN Act are entitled to first priority administrative expense status under 11 U.S.C. Sec. 503(b)(1)(A). The case is, William Dean, Robert Gregory, Henry Dini, Fred Shourds, and Michael Jablonowski, Individually and as Class Representatives on behalf of a Putative Class of all others similarly situated, Plaintiffs, v. Hostess Brands, Inc., IBC Sales Corporation; IBC Services, LLC, IBC Trucking, LLC, Interstate Brands Corporation, and MCF Legacy, Inc., Defendants, Adv. Proc. No. 12-_____ (Bankr. S.D.N.Y.). The Plaintiffs are represented by: David S. Preminger, Esq. KELLER ROHRBACK L.L.P. 770 Broadway, Second Floor New York, NY 10003 Tel: (646) 495-6198 Fax: (646) 495-6197 E-mail: dpreminger@kellerrohrback.com - and - Lynn L. Sarko, Esq. Mark Griffin, Esq. Tana Lin, Esq. Deirdre Glynn Levin, Esq. KELLER ROHRBACK L.L.P. 1201 Third Avenue, Suite 3200 Seattle, WA 98101 Tel: (206) 623-1900 Fax: (206) 623-3384 - and - Gary A. Gotto, Esq. KELLER ROHRBACK P.L.C. 3101 N Central Ave., Ste. 1400 Phoenix, AZ 85012-2643 Tel: (602) 248-0088 E-mail: ggotto@kellerrohrback.com 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. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. 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). In the new Chapter 11 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. The official committee of unsecured creditors 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. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. The bankruptcy judge signed a formal order on Nov. 30 giving final approval to wind-down procedures. The latest budget projects the $49 million loan for the Chapter 11 case being paid down to $21.2 million by Feb. 22. HOSTESS BRANDS: Taps Hilco Industrial et al., as Marketing Agents ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York will convene hearing on Dec. 21, 2012, at 10 a.m., to consider Hostess Brands, Inc., et al.'s request to employ Hilco Industrial, LLC, Hilco IP Services, LLC and Hilco Real Estate, LLC as consulting and marketing agents; and obtain related postpetition financing. Objections, if any, are due 4 p.m. on Dec. 14, 2012. In relation to the employment of Hilco, the Debtors request that the Court approve the terms and conditions of the Consulting and Marketing Services Agreement for Real Property and Other Assets dated Dec. 7, 2012, by and between Hilco and the Debtors. Pursuant to the agreement, the Debtors intend to: 1. obtain a postpetition secured credit in an aggregate amount not to exceed $30 million; grant a superpriority administrative expense claim status to claims of Hilco for repayment of the loan and all accrued and unpaid interest thereon (but which is junior to the superpriority administrative expense claims of the senior secured revolving credit lenders; 2. as security for the repayment of the loan and all accrued and unpaid interest thereon, grant Hilco security interests in and liens on the Hilco Collateral that prime the liens of all of the secured lenders other than the senior secured revolving credit lenders; and 3. seek approval of the Eighth Amendment to the DIP Credit Agreement to facilitate the transaction. The material terms of the loan, include, among other things: Lender: Hilco Commitment: A second priority secured loan in the aggregate amount of $30 million, payable to the Debtors in cash within two business days of the entry of the proposed order granting the motion. Maturity: The loan and any accrued and unpaid interest thereon will be repaid in full no later than the date that is 180 days after the agreement date. Interest Rate: 6.5% per annum on the unpaid principal amount of the loan. Under the terms of the agreement, Hilco will receive these payments in exchange for the services in connection with the wind- down: a) Hilco will be entitled to charge, withhold from proceeds and retain for its own account an industry-standard "buyer's premium" of 15% of the sale price received from the sale of M&E. The Debtors will be entitled to a rebate of all collected buyer's premiums in an amount equal to 1.5% of the sale price received from the sale of the applicable M&E, payable within 10 business days of Hilco's collection of the applicable buyer's premium. b) Hilco has agreed to perform the IP Services for no additional compensation beyond that earned in connection with the Real Estate Services and the M&E Services. In the event that Hilco and the Debtors agree to expand the scope of the IP Services beyond that set forth in the agreement, Hilco will be entitled to such compensation as is mutually agreed upon by Hilco and the Debtors, subject to the Court's approval of the expanded scope and compensation. c) In no event will Hilco earn aggregate compensation under the Agreement on account of Services rendered of less than $2,000,000. To the best of the Debtors' knowledge, Hilco is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. 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. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. 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). In the new Chapter 11 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. The official committee of unsecured creditors 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. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. HOSTESS BRANDS: Hearing on Exclusivity Extension Set for Dec. 21 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York will convene a hearing on Dec. 21, 2012, at 10 a.m., to consider Hostess Brands, Inc., et al.'s third motion for extension of their exclusivity periods. Objections, if any, are due Dec. 14. The Debtors are requesting that the Court extend their exclusive periods to propose a Chapter 11 plan and solicit acceptances for that plan until March 6, 2013, and May 6, respectively. According to the Debtor, they have determined that the emergence of the Debtors from bankruptcy on a going concern basis is no longer possible. Accordingly, the Debtors are now pursuing an orderly wind-down of their businesses and the sale of substantially all of their assets in Chapter 11. The Court approved on Nov. 30, the Debtors' wind-down motion. In this relation, the Debtors are winding down their businesses and have commenced a sale process for all of their assets that they expect will continue over the next several months. 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. DHostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. 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). In the new Chapter 11 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. The official committee of unsecured creditors 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. Hostess Brands in mid-November opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands said it intends to retain approximately 3,200 employees to assist with the initial phase of the wind down. Employee headcount is expected to decrease by 94% within the first 16 weeks of the wind down. The entire process is expected to be completed in one year. INSPIRATION BIOPHARMACEUTICALS: DIP Financing Hiked to $4.8-Mil --------------------------------------------------------------- U.S. Bankruptcy Judge William C. Hillman has approved a stipulation between Inspiration Biopharmaceuticals Inc. and Ipsen Pharma S.A.S. Under the stipulated order, the Debtor is authorized to borrow on an interim basis, $4,800,000 from the $4,500,000 originally approved, through Dec. 14, 2012. The Court will hold a final hearing on the DIP loan that day. The deadline for the Official Committee of Unsecured Creditors and the Office of the United States Trustee to file objections to the postpetition financing has been extended to Dec. 12. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. It estimated assets of more than $100 million on its Chapter 11 petition. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/-- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMACEUTICALS: Can Employ FTI's Michael Nowlan --------------------------------------------------------------- U.S. Bankruptcy Judge William C. Hillman has authorized Inspiration Biopharmaceuticals Inc. to employ FTI Consulting Inc. as Turnaround Manager. Specifically, and in connection with the employment order, the Debtor is authorized to hire Michael Nowlan as Chief Restructuring Officer. FTI Consulting Inc. attests that it is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. It estimated assets of more than $100 million on its Chapter 11 petition. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/-- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMACEUTICALS: THG OK'd as Committee's Advisor --------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts authorized the Official Committee of Unsecured Creditors in the Chapter 11 case of Inspiration Biopharmaceuticals, Inc., to retain Hawthorne Consulting Group, Inc. as its financial advisor. As reported in the Troubled Company Reporter on Dec. 5, 2012, THG is expected to, among other things: -- assist and advise the Committee in the analysis of the current financial position of the Debtor; -- attend and advise the meetings/calls with the Committee and its counsel and representatives of the Debtor and other parties; and -- assist and render expert testimony on behalf of the Committee as may be agreed by THG. The hourly rates of THG's personnel are: Donald Hawthorne $600 Martha E. M. Kopacz $550 Charles Grudzinzkas $600 William Bennett $550 Nancy Arnosti $500 Padric Kelley O'Brien $500 Berrett McGrath $500 Other Professionals $325 - $500 THG attests it is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMACEUTICALS: Severance Plan and KEIP Okayed -------------------------------------------------------------- The Hon. William C. Hillman of the U.S. Bankruptcy Court for the District of Massachusetts authorized Inspiration Biopharmaceuticals, Inc., to enter into a postpetition severance plan, and key employee incentive plan. The Court also ordered that the release to be granted by eligible employees for participating in the severance plan will not include claims for accrued vacation time and any claims for indemnification, contribution, reimbursement, or any right to payment under any director and officer insurance policy and organization document. The KEIP is approved, as modified. In the event that one or more sale transaction(s) are consummated having an aggregate minimum upfront cash component of at least $40,000,000, then in the event employees of the Debtor at the time of sale will be entitled to an incentive payment, as a percentage of their annual salary, based upon these increments: $40MM $50MM $60MM $70MM $80MM $90MM $100MM ----- ----- ----- ----- ----- ----- ------ Senior Leadership Team 50% 65% 80% 95% 110% 125% 150% Key Staff 50% 55% 60% 65% 70% 75% 85% The KEIP payments will be paid only from the proceeds of the sale of the debtor's assets subject to the security interest of Ipsen Pharma, S.A.S., or from the sale of the Ipsen participating assets. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMACEUTICALS: Files Schedules of Assets & Debts ----------------------------------------------------------------- Inspiration Biopharmaceuticals, Inc., filed with the U.S. Bankruptcy Court for the District of Massachusetts its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $20,383,300 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $203,308,810 E. Creditors Holding Unsecured Priority Claims $148,886 F. Creditors Holding Unsecured Non-priority Claims $37,597,163 ----------- ----------- TOTAL $20,383,300 $241,049,859 A copy of the schedules is available for free at http://bankrupt.com/misc/INSPIRATION_BIOPHARMA_sal.pdf About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INSPIRATION BIOPHARMACEUTICALS: Hearing on Cash Use Friday ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts continued until Dec. 14, 2012, at 9;30 a.m., the hearing to consider Inspiration Biopharmaceuticals, Inc.'s motions to: i) use of cash collateral; ii) set bidding procedures in connection with marketing and proposed sale of substantially all of its assets, credit bid waiver threshold and release of certain claims; iii) employ Evercore Group, LLC as investment banker for a limited purpose; and iv) modify agreements with CMC ICOS Biologics, Inc., and to assume the agreements as modified. The Debtor sought for a continuance of the hearings scheduled early this month because of the objections filed to the motions. On Nov. 29, the U.S. Trustee's objected to the marketing and proposed sale of substantially all of its assets, credit bid waiver threshold and release of certain claims because, among other things: -- Ipsen Pharma, S.A.S., the Debtor's purported primary lender, largest unsecured creditor and an insider, is using its influence over the Debtor to orchestrate a Section 363 sale of non-debtor and non-estate assets, which is simply not authorized under the Bankruptcy Code. -- by the bidding procedures, the Debtor is not simply seeking approval of procedures but is attempting to resolve all issues relating to the plan process and distribution under a Plan. -- the motion contemplated by Ipsen and the Debtor is not designed to maximize value for the Debtor's estate and the creditors thereof, prevents competing offers and results in an unfair sale process. About Inspiration Biopharmaceuticals Inspiration Biopharmaceuticals Inc. develops recombinant blood coagulation factor products for the treatment of hemophilia. Inspiration, based in Cambridge, Massachusetts, has two products in what the company calls "advanced clinical development." Two other products are in "pre-clinical development." None of the products can be marketed as yet. Inspiration filed for voluntary Chapter 11 reorganization (Bankr. D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston. Bankruptcy Judge William C. Hillman oversees the case. Mark Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the Debtor's Chief Restructuring Officers. The Debtor is represented by Harold B. Murphy of Murphy & King. The petition shows assets and debt both exceed $100 million. Assets include patents, trademarks and the products in development. Liabilities include $195 million owing to Ipsen Pharma SAS, which is also a 15.5% shareholder. Ipsen is also owed $19.4 million in unsecured debt. There is another $12 million in unsecured claims. Ipsen is pledged to provide $18.3 million in financing. The Debtor disclosed $20,383,300 in assets and $241,049,859 in liabilities. As part of its bankruptcy, Inspiration is seeking to sell its assets to a third party purchaser. Ipsen -- http://www.ipsen.com/ -- a global specialty driven pharmaceutical company, also has agreed to include its hemophilia assets in the sale process under certain conditions. Ipsen is represented by J. Eric Ivester, Esq., at Skadden Arps. The Official Committee of Unsecured Creditors tapped Jeffrey D. Sternklar and Duane Morris LLP as its counsel, and The Hawthorne Consulting Group, LLC as its financial advisor. INTERNATIONAL LEASE: AIG Deal Cues Fitch to Affirm 'BB' IDR ----------------------------------------------------------- Fitch Ratings has affirmed International Lease Finance Corporation's (ILFC) Issuer Default Rating (IDR) at 'BB'. The Rating Outlook remains Stable. The rating action follows the announcement that American International Group (AIG) has entered into an agreement to sell the majority of its ownership stake in ILFC to a consortium of Chinese firms. Once successfully completed, this transaction would conclude a lengthy sale process and resolve long-standing uncertainty about ILFC's long-term ownership. Fitch would expect ILFC's management team, fundamental strategy and market presence to remain largely unchanged for the foreseeable future. Over time, Fitch will assess the role ILFC's new owners will play in setting the strategic direction of the company. Fitch has viewed ILFC's ratings on a standalone basis, without any uplift for AIG's ownership, since they were downgraded to the current level in February 2010. Inability to complete the proposed sale for regulatory or other reasons may have a negative impact on ILFC's ratings as a result of increased strategic uncertainty. The transaction would value ILFC at $5.28 billion, which is a material discount to the current book equity value of $7.87 billion. Fitch expects that the purchase accounting adjustments required under general acceptable accounting principles (GAAP) may significantly alter ILFC's balance sheet. However, the economic fundamentals of the business (including operating cash flows, liquidity, debt obligations and aircraft fleet) are expected to remain unchanged. ILFC's ratings and Stable Outlook continue to be supported by the company's stable operating cash flow profile, funding diversity and sizeable market position. The main constraints on the ratings include lack of consistent profitability, uncertainty regarding aircraft residual values and a less attractive fleet profile than higher-rated peers. The resolution of the uncertainty regarding ILFC's ultimate ownership is viewed as generally positive. However, the potential longer-term influence of the ownership group on ILFC's leverage, growth strategy, lease rates, customer base, geographic concentration and/or mix of aircraft manufacturers are all considerations which could impact Fitch's rating or rating outlook for ILFC in the future. Furthermore, the credit profiles and capital needs of ILFC's new ownership group will need to be considered in the context of their impact on the financial resources and flexibility of ILFC. Rating Drivers and Sensitivities Many details of the proposed transaction have yet to be finalized and Fitch will continue to assess the potential changes to ILFC's corporate governance and long-term strategy. A meaningful change in ILFC's growth plans may influence Fitch's long-term view of the ratings. Furthermore, any adverse impact on ILFC's current funding facilities or future availability of credit may have a negative impact on its ratings. ILFC's ratings are constrained by the company's lack of profitability over the past two fiscal years, which has been caused by significant impairment charges on older aircraft, as well as the weighted average age of its fleet, which is older than other Fitch-rated peers. In addition to the factors outlined above, negative momentum for the ratings and/or Rating Outlook could result from inability to access capital markets to fund debt maturities or purchase commitments, deterioration in operating cash flow or a permanent increase in balance sheet leverage. While positive rating momentum is not likely in the near term, over a longer-term time horizon, positive drivers would include consistent profitability, demonstrated funding flexibility, commitment to reduced leverage levels and a robust corporate governance structure. ILFC is a market leader in the leasing and remarketing of commercial jet aircraft to airlines around the world. As of Sept. 30, 2012, ILFC owned an aircraft portfolio with a net book value of approximately $35 billion, consisting of 918 jet aircraft. Fitch has affirmed the following ratings: International Lease Finance Corp. -- Long-term Issuer Default Rating at 'BB'; Outlook Stable; -- Senior secured notes at 'BBB-'; -- Senior unsecured debt at 'BB'; -- Preferred stock at 'B'. Delos Aircraft Inc. -- Senior secured debt at 'BB'. Flying Fortress Inc. -- Senior secured debt at 'BB'. ILFC E-Capital Trust I -- Preferred stock at 'B'. ILFC E-Capital Trust II -- Preferred stock at 'B'. JESUP HOSPITALITY: Case Summary & 6 Unsecured Creditors ------------------------------------------------------- Debtor: Jesup Hospitality, Inc. 3702 Inverness Way Augusta, GA 30907 Bankruptcy Case No.: 12-12246 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Southern District of Georgia (Augusta) Judge: Susan D. Barrett Debtor's Counsel: James C. Overstreet, Jr., Esq. KLOSINSKI OVERSTREET, LLP #7 George C. Wilson Ct. Augusta, GA 30909 Tel: (706) 863-2255 Fax: (706) 863-5885 E-mail: jco@klosinski.com Scheduled Assets: $1,723,000 Scheduled Liabilities: $2,367,591 A copy of the Company's list of its six largest unsecured creditors is available for free at http://bankrupt.com/misc/gasb12-12246.pdf The petition was signed by Jugal Purohit, president. Affiliate that filed separate Chapter 11 petition: Petition Debtor Case No. Date ------ -------- ---- Madison Hotels, LLC 12-11637 09/12/12 Washington Hospitality, LLC 12-12116 11/16/12 K-V PHARMACEUTICAL: Secures Commitment for $85 Million Loan ----------------------------------------------------------- K-V Pharmaceutical Company has received a commitment from lenders led by an affiliate of Silver Point Finance LLC for $85 million in senior secured post-petition debtor-in-possession financing, which the Company intends to use to, among other things, satisfy the terms of its recently filed settlement agreement with Hologic, Inc., provide additional financial flexibility during the pendency of the Company's Chapter 11 proceeding and fund certain payments under a proposed reorganization plan. The new DIP financing, the Hologic Settlement and the reorganization plan (and related disclosure statement) are each subject to approval of the U. S. Bankruptcy Court for the Southern District of New York, the Honorable Judge Allan L. Gropper presiding. The Hologic Settlement confirms K-V's continued ownership of Makena and will resolve all bankruptcy related disputes between K- V and Hologic, and provides for mutual releases of all claims between the parties. Under the proposed reorganization plan, K-V expects to emerge from Chapter 11 with its entire product portfolio, including Makena, Clindesse, Gynazole-1 and Evamist. The Company has provided and is committed to continue to provide its women's health care products without interruption to meet the needs of the health care providers and patients it serves. Prior to the funding of the DIP financing facility, K-V intends to file with the Bankruptcy Court a proposed reorganization plan, a related disclosure statement, and a plan support agreement (PSA) with an ad hoc group of senior secured noteholders. The principal terms of the proposed reorganization plan are contained in a plan term sheet filed with the motion to approve the DIP financing filed with the Bankruptcy Court, which together with other documents from the Chapter 11 cases, can be found at http://dm.epiq11.com/KVD The DIP Lenders consist of affiliates or funds of each of Silver Point Finance, LLC, Whitebox Advisors, LLC, and Pioneer Investment Management, Inc. About K-V Pharmaceutical K-V Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. K-V Pharmaceutical Company and certain domestic subsidiaries on Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions Inc.) to restructure their financial obligations. K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel, Williams & Connolly LLP as special litigation counsel, and SNR Denton as special litigation counsel. In addition, K-V tapped Jefferies & Co., Inc., as financial advisor and investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. The U.S. Trustee appointed five members to serve in the Official Committee of Unsecured Creditors. Kristopher M. Hansen, Esq., Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, represent the Creditors Committee. Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R. Fife, Esq., represent an Ad Hoc Senior Noteholders Group. LAKEWOOD ENGINEERING: Supreme Court Won't Hear Trademark Dispute ---------------------------------------------------------------- Terry Baynes, writing for Reuters, reports the U.S. Supreme Court on Monday refused to resolve the question of what happens to the license to use a trademark when the owner of that trademark goes through bankruptcy. In an order, without comment, the high court rejected a request from Jarden Consumer Solutions to help settle a conflict between federal courts of appeal over whether trademark licenses survive bankruptcy. Reuters relates the case involves Lakewood Engineering & Manufacturing Co, a consumer products company that outsourced the manufacturing of box fans bearing its trademark to Chicago American Manufacturing. Lakewood's creditors in 2009 filed an involuntary bankruptcy petition against the company. The bankruptcy trustee rejected Lakewood's supply contract with Chicago American and sold the bulk of Lakewood's assets to the highest bidder, Jarden. Chicago American continued to produce fans with the Lakewood trademark, prompting a lawsuit by the trustee and later Jarden for trademark infringement. But the bankruptcy court found that even though the trustee had rejected the contract, Chicago American could continue to use the Lakewood trademark. According to the report, the U.S. Court of Appeals for the Seventh Circuit reached the same conclusion in July, breaking with a 1985 ruling from the 4th Circuit, Lubrizol Enterprises v. Richmond Metal Finishers, which found that a trustee's rejection of a licensing agreement terminated all rights to continue to use the debtor's intellectual property. Reuters notes that, in response to that 4th Circuit ruling, Congress in 1988 changed the bankruptcy code to allow holders of intellectual property licenses from a debtor to retain their rights even if a trustee rejects the licensing agreement in a bankruptcy. However, in its definition of "intellectual property," Congress included patents and copyrights but not trademarks. For decades, that left the holders of trademark licenses at risk of losing their rights if the licensing agreement was rejected in a bankruptcy. But the 7th Circuit extended the protection to trademark licenses in July, acknowledging that its decision created a division between the federal courts of appeal, Reuters says. "We think this is going to interfere with the bankruptcy process and lead to the dilution of trademark rights by creating uncertainty regarding the parties' trademark rights and obligations post-rejection in bankruptcy," said Leonard Feldman, Esq., Jarden's appellate lawyer at Stoel Rives, according to the report. Reuters notes Chicago American's lawyer, David Goroff, Esq., at Foley & Lardner, said the 7th Circuit ruling provided clear guidance to both sides on trademark licenses. "If you have a license, you don't have to fear that bankruptcy means (your rights) disappear in a flash," he said. The case is Sunbeam Products Inc v. Chicago American Manufacturing, No. 12-431. LAVEN HOSPITALITY: Case Summary & 6 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Laven Hospitality, LLC 1623 SW 1st Avenue Ocala, FL 34471 Bankruptcy Case No.: 12-18535 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Buddy D. Ford, Esq. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 E-mail: Buddy@tampaesq.com Scheduled Assets: $463,000 Scheduled Liabilities: $1,968,690 The Company's list of its six largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/flmb12-18535.pdf The petition was signed by Dawn Tottel, Manager of Hanar, LLC, manager. Affiliates that filed separate Chapter 11 petitions: Entity Case No. Petition Date ------ -------- ------------- Chaps Hospitality, LLC 12-05072 04/02/12 Hanar, LLC 12-04470 07/06/12 Laan Hospitalities, LLC 12-00252 01/17/12 U.S. Land Trust No. 99 12-01855 02/10/12 VLG Hospitality, LLC 12-01689 02/07/12 LBI MEDIA: S&P Ups CCR to 'CC' on Discount Note Interest Payment ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Burbank, Calif.-based LBI Media Inc. (LBI) to 'CC' from 'D'. The outlook is negative. "The issue-level rating on the company's 8.5% senior subordinated notes due 2017 remains 'CC', and the recovery rating on this debt remains unchanged at '6' (0% to 10% recovery expectation). Upon the exchange, we will lower the issue-level rating on the 8.5% senior subordinated notes due 2017 to 'D'," S&P said. The issue-level rating on the company's 9.25% senior secured notes due 2019 remains 'CCC'. The recovery rating on this debt remains unchanged at '3' (50% to 70% recovery expectation). "We raised the corporate credit rating to 'CC' from 'D' based on LBI Media Holdings' disclosure that it made the interest payment (about $3.8 million) on its 11% senior discount notes and had cured the default," said Standard & Poor's credit analyst Minesh Patel. "On July 17, 2012, LBI announced its intent to deleverage its balance sheet by reducing the outstanding principal amount of debt issued by LBI and LBI Media Holdings. Subject to conditions, the company had offered to exchange at below par value new second- priority secured springing subordinated notes due 2020 or holding company notes due 2017 for its 8.5% subordinated notes and 11% discount notes. As of Dec. 10, 2012, noteholders had tendered 76.3% of the principal amount of outstanding senior subordinated notes, and 72.7% of the principal amount of the outstanding senior discount notes not held by LBI Media Holdings (about 83.3% including debt held by the company). We estimate the company has the required consent from senior subordinated noteholders and the senior discount noteholder to modify their debt indentures. The exchange is conditioned upon, among other things, an amendment of the existing senior secured note indenture to allow for the subpar debt exchange. As of Dec. 10, 2012, LBI has consent from holders of about 29% of the outstanding principal balance. The amendment requires the consent from holders of more than 50% of principal," S&P said. "We view LBI's business risk profile as 'weak' (as per our criteria), given its cash flow concentration in a small number of large U.S. Hispanic markets, intense competition for audiences and advertisers from much larger rivals like Univision Communications Inc., and risks surrounding TV network start-ups. In the third- quarter 2012, revenue grew 5.3% over the prior-year period, led by 7.6% growth in the TV segment. EBITDA declined by 23% because of ongoing investments in programming and increased administration costs. We view the company's financial risk profile as 'highly leveraged.' Debt to EBITDA (adjusted for operating leases and including the 11% holding company senior discount notes) was extremely high, at 23x and EBITDA coverage of interest was fractional, at 0.5x for the 12 months ended Sept. 30, 2012. We expect EBITDA coverage of interest to remain meaningfully less than 1x over the intermediate term, causing LBI to rely on revolver availability to meet a portion of cash interest payments," S&P said. LCI HOLDING: Case Summary & 30 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: LCI Holding Company, Inc. 5340 Legacy Drive Building 4, Suite 150 Plano, TX 75024 Bankruptcy Case No.: 12-13319 Affiliates that simultaneously sought Chapter 11 protection: Debtor Case No. ------ -------- Boise Intensive Care Hospital, Inc. 12-13331 CareRehab Services, L.L.C. 12-13332 Crescent City Hospitals, L.L.C. 12-13333 LCI Healthcare Holdings, Inc. 12-13330 LCI Holdco, LLC 12-13329 LCI Intermediate Holdco, Inc. 12-13328 LifeCare Ambulatory Surgery Center, Inc. 12-13334 LifeCare Holding Company of Texas, LLC 12-13335 LifeCare Holdings, Inc. 12-13321 LifeCare Hospital at Tenaya, LLC 12-13326 LifeCare Hospitals, LLC 12-13336 LifeCare Hospitals of Chester County, Inc. 12-13337 LifeCare Hospitals of Dayton, Inc. 12-13338 LifeCare Hospitals of Fort Worth, L.P. 12-13339 LifeCare Hospitals of Mechanicsburg, LLC 12-13324 LifeCare Hospitals of Milwaukee, Inc. 12-13323 LifeCare Hospitals of New Orleans, L.L.C. 12-13340 LifeCare Hospitals of North Carolina, LLC 12-13341 LifeCare Hospitals of North Texas, L.P. 12-13342 LifeCare Hospitals of Northern Nevada, Inc. 12-13343 LifeCare Hospitals of Pittsburgh, LLC 12-13344 LifeCare Hospitals of San Antonio, LLC 12-13345 LifeCare Hospitals of Sarasota, LLC 12-13327 LifeCare Hospitals of South Texas, Inc. 12-13346 LifeCare Investments, L.L.C. 12-13347 LifeCare Investments 2, LLC 12-13348 LifeCare Management Services, L.L.C. 12-13349 LifeCare REIT 1, Inc. 12-13320 LifeCare REIT 2, Inc. 12-13350 LifeCare Specialty Hospital of North Louisiana, LLC 12-13325 NextCARE Specialty Hospital of Denver, Inc. 12-13351 NextCARE Hospitals/Muskegon, Inc. 12-13352 Pittsburgh Specialty Hospital, LLC 12-13353 San Antonio Specialty Hospital, Ltd. 12-13322 Type of Business: LifeCare Holdings, Inc., currently operates 27 long term acute care hospitals located in ten states. Long-term acute care hospitals specialize in the treatment of medically complex patients who typically require extended hospitalization. Web site: http://www.lifecare-hospitals.com/ Chapter 11 Petition Date: December 11, 2012 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Kevin Gross Debtors' Counsel: Anthony W. Clark, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP One Rodney Square Wilmington, DE 19899 Tel: (302) 651-3000 Fax: (302) 651-3001 E-mail: anthony.clark@skadden.com Kenneth S. Ziman, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP Four Times Square New York, NY 10036-6522 Tel: (212) 735-3000 Fax: (212) 735-2000 E-mail: ken.ziman@skadden.com Felicia Gerber Perlman, Esq. Matthew N. Kriegel, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 155 N. Wacker Drive Chicago, IL 60606 Tel: (312) 407-0700 Fax: (312) 407-0411 E-mail: felicia.perlman@skadden.com matthew.kriegel@skadden.com Debtors' Conflicts Counsel: David R. Hurst, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP The Brandywine Bldg., 17th Fl 1000 West Street Wilmington, DE 19801 Tel: (302) 571-6600 E-mail: dhurst@ycst.com Debtors' Financial Advisor and Investment Banker: ROTHSCHILD INC. Debtors' Claims and Noticing Agent: KURTZMAN CARSON CONSULTANTS LLC 2335 Alaska Ave El Segundo, CA 90245 Total Assets: $422 million as of Sept. 30, 2012. Total Liabilities: $575.9 million as of Sept. 30, 2012. The petitions were signed by Phillip B. Douglas, chief executive officer. Debtors' Consolidated List of Their 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ US Bank NA Subordinated $128,108,482 CM-9690 Notes PO Box 70870 St. Paul, MN 55170-9690 Vibra Healthcare LLC Promissory $2,500,000 4550 Lena Dr Note Suite 225 Mechanicsburg, PA 17055 Recover Care LLC Accounts $301,653 Key Bank - Lock Payable Bank #713222 895 Central Ave. Ste 660 Cincinnati, OH 45202 Medline Industries, Inc. Accounts $144,659 Payable BMA of Northwest LA Accounts $77,555 Payable Crest Services Accounts $60,467 Payable West Penn Allegheny Accounts $57,324 Health System Payable Quest Diagnostics, Inc. Accounts $56,588 Payable Baxter Healthcare Corp. Accounts $47,529 Payable A Vital Response Inc. Accounts $46,326 Payable American Express Accounts $45,000 Payable Pharmacy Onesource Inc. Accounts $43,459 Payable Purity Dialysis Accounts $42,856 Payable Dallas Acute Dialysis Accounts $34,945 Payable Healthland Accounts $29,627 Payable C R Bard Inc. Accounts $29,612 Payable Abbott Nutrition Accounts $28,781 Payable Dialysis Clinic Inc. Accounts $28,755 Payable Siemens Healthcare Diagnostics Accounts $28,712 Siemens Med Solutions Payable Diagnostics Cbiz Valuation Group LLC Accounts $27,268 Payable Angelica Textile Services Inc. Accounts $25,279 Payable Stericycle Accounts $24,529 Payable Hemodialysis Services Inc. Accounts $24,342 Payable Dell Financial Services Accounts $24,161 Payment Processing Center Payable KCI USA Accounts $23,426 Payable Healthcare Services Group Inc. Accounts $23,351 Payable Giant Eagle Inc. Accounts $23,275 Payable Vista Staffing Solutions Inc. Accounts $23,205 Payable US Med-Equip Inc. Accounts $23,103 Payable Burton Auto Supply Accounts $21,469 Payable LEHI ROLLER: Files Bankruptcy in Salt Lake City ----------------------------------------------- Lehi Roller Mills Co., Inc., filed for Chapter 11 bankruptcy (Bankr. D. Utah Case No. 12-35291) on Dec. 6, 2012, estimating under $50,000 in both assets and liabilities. Judge R. Kimball Mosier oversees the case. Sam Penrod at Deseret News reports a company spokesperson Rick Brown said the company hopes to reorganize, eventually emerge from bankruptcy and stay in business. "We are still in business," Mr. Brown said. "It is business as usual. Now, with a new financial plan to give us a good financial basis, we can go forward." Deseret News relates the company has been in financial trouble since 2009, when its accounts were frozen and a line of credit withdrawn to prevent budget shortages. A lawsuit was filed earlier this year after the company failed to pay employees, but the suit was dropped after the employees were paid. Lehi Roller Mills sells a variety of retail products. But the majority of the company's sales of wheat and flour are to commercial customers. Lehi Roller Mills Co., based in Lehi, Utah, is represented by: Jeffrey Q. Cardon, Esq. HILL, JOHNSON & SCHMUTZ, LC P.O. Box 971597 Orem, UT 84097-1597 Tel: (801) 375-6600 Fax : (801) 375-3865 Email: jcardon@hjslaw.com Jeffrey Weston Shields filed a notice of appearance and request of notice in the case, on behalf of Transportation Alliance Bank Inc. LEHMAN BROTHERS: Court Approves A&M's $42 Million Bonus ------------------------------------------------------- The U.S. Bankruptcy Court in Manhattan approved Alvarez & Marsal North America LLC's application for final allowance of incentive fees it earned during the period September 15, 2008 to March 6, 2012. In a three-page order, the bankruptcy court approved the firm's so-called asset management incentive fee of $29,649,366, which it earned before November 28. The payment will be made pursuant to Lehman's Chapter 11 plan. The bankruptcy court also ordered the payment of the firm's claims management incentive fees in the sum of $12.38 million. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012 and a second payment of $10.2 billion on Oct. 1. A third distribution is set for around March 30, 2013. The brokerage is yet to make a first distribution to non-customers. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-700) LIFECARE HOLDINGS: Moody's Cuts PDR to 'D' After Ch. 11 Filing -------------------------------------------------------------- Moody's Investors Service lowered LifeCare Holdings, Inc.'s corporate family rating to Ca from Caa3 and the probability of default rating to D from Ca/LD. The ratings were downgraded because LifeCare filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware. As part of this action, Moody's also affirmed the subordinated notes rating at C. The following rating actions were taken: Corporate family rating downgraded to Ca from Caa3; Probability of default rating downgraded to D from Ca/LD; $119 million sr. subordinated notes, due August 2013, affirmed at C and LGD rate changed to LGD6, 90% from LGD5, 75%; Speculative-grade liquidity rating, affirmed at SGL-4. Ratings Rationale Subsequent to the actions, Moody's will withdraw the ratings because LifeCare has entered bankruptcy. The principal methodology used in rating LifeCare was the Global Healthcare Service Providers Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Plano, TX, LifeCare operates 27 long-term acute care hospitals in ten states. The company's facilities include eight "hospital within a hospital" facilities ("HWH") and 19 free- standing facilities. In addition, the company holds a 50% investment in a joint venture for a long-term care hospital. Prior entering to Chapter 11, LifeCare was owned by Carlyle. LIN TELEVISION: Moody's Assigns 'Ba2' CFR; Rates Revolver 'Ba2' --------------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to LIN Television Corporation's proposed $75 million 1st lien secured revolver. The new revolver is being extended one year to October 2017 and pricing on the existing term loan B is being reduced. Proposed terms under the credit agreement include relaxing financial covenant levels and eliminating step downs. Moody's affirmed LIN's B2 Corporate Family Rating (CFR) and Probability of Default Rating (PDR), as well as the SGL-2 Speculative Grade Liquidity (SGL) Rating. The rating outlook remains stable. Assigned: Issuer: LIN Television Corporation NEW $75 million 1st Lien Sr Secured Revolver: Assigned Ba2, LGD2 -- 18% Affirmed: Issuer: LIN Television Corporation Corporate Family Rating: Affirmed B2 Probability of Default Rating: Affirmed B2 1st lien sr secured term loan A due 2017 ($124.5 million outstanding): Affirmed Ba2, LGD2 -- 18% 1st lien sr secured term loan B ($258.1 million outstanding): Affirmed Ba2, LGD2 -- 18% $200 million of 8.375% sr notes due 2018: Affirmed B3, LGD5 -- 75% $290 million of 6.375% sr notes due 2021: Affirmed B3, LGD5 -- 75% Speculative Grade Liquidity Rating: Affirmed SGL -- 2 Outlook Actions: Issuer: LIN Television Corporation Outlook is Stable To be withdrawn upon closing of the transaction: Issuer: LIN Television Corporation EXISTING 1st lien sr secured revolver due 2016, Ba2, LGD2 -- 18%: To be withdrawn Ratings Rationale LIN's B2 Corporate Family Rating (CFR) reflects high leverage with a 2-year average debt-to-EBITDA ratio of 5.1x (including Moody's standard adjustments) estimated for December 31, 2012 reflecting improvement compared to 5.5x as of June 30, 2012 pro forma for the acquisition of New Vision Television. Strong demand for political advertising in the second half of 2012 resulted in an EBITDA boost and improved leverage to levels that were reported prior to the acquisition of New Vision Television. Moody's expects LIN will utilize the majority of its free cash flow to reduce debt balances, leading to improved capacity to fund an acquisition or dissolution of the NBC JV within leverage parameters consistent with its B2 CFR. Moody's expects 2-year average leverage ratios to fall below 5.0x by the end of 2013, absent additional acquisitions. EBITDA should decline in the high single-digit percentage range in 2013, on a same store basis, due to the absence of significant political ad spending (more than $65 million in 2012), partially offset by low single-digit growth in core ad revenues and expected increases in retransmission fees. The company's leading market positions and good free cash flow generated by its geographically diverse portfolio of middle market television stations partially offset the negative impact of potential delays in achieving the portion of planned revenue synergies related to the New Vision acquisition and the overhang from LIN TV Corp.'s guarantee of the NBC JV debt. LIN has multiple network affiliates in 18 of its 23 markets leading to high revenue share and good margins. The proposed amendment reduces pricing on the term loan saving $1.9 million of cash interest in 2013. The amendment also provides a greater EBITDA cushion to financial maintenance covenants by relaxing the total leverage test to 7.0x from 6.0x, relaxing the senior leverage test to 3.75x from 3.0x, and eliminating leverage requirement step-downs. Moody's notes proposed terms provide management with greater flexibility to refinance at least a portion of the $815.5 million NBC JV note. Ratings incorporate expectations that LIN will achieve the majority of its planned $25 million of revenue and expense synergies related to the New Vision acquisition by the end of 2014 and that retransmission revenues through the end of 2013 will increase for existing and newly acquired stations accompanied by higher expenses related to retransmission sharing fees (or reverse compensation) paid to the networks. Exposure to cyclical advertising revenue and the ongoing risk of audience diffusion resulting from media fragmentation weigh on debt ratings. Liquidity is good with minimum 2-year average free cash flow-to- debt ratios of 7% over the rating horizon and the absence of near term maturities. Ratings also reflect weaker than expected performance for the NBC JV with lower than initially anticipated retransmission revenues for 2013 and 2014, reduced ad revenue expectations primarily for the Dallas station, and the decision to fund construction of a new studio in Fort Worth. Although stronger EBITDA generation from LIN's stations in the second half of 2012 and lower debt balances offset weaker anticipated performance for the NBC JV in 2013, failure to keep the NBC JV on track with its revised operating plan would erode the asset coverage provided by the NBC JV stations putting additional downward pressure on LIN's debt ratings. The NBC JV continues to be a significant overhang that poses elevated risk to LIN's credit profile given the recent increase in the expected shortfalls in meeting interest payments on its $815.5 million loan from General Electric Capital Corporation ("GECC") through 2014 and given the decline in its asset value since the JV was formed in 1998. As of December 2011, the NBC JV was valued at $118 million less than amount due under the note; although significant, this value gap reflects improvement compared to the estimated $254 million gap between asset value and the note amount at FYE2010 and $366 million at FYE2009. Moody's believes the NBC JV has a greater reliance on the financial capacity of LIN due to increased potential that the value of the NBC JV will be less than the amounts owed related to the $815.5 million note at maturity in addition to any unpaid shortfall loans (currently not guaranteed by LIN). In January 2011, Comcast acquired 51% of NBCUniversal, Inc. with GE owning the remaining 49%. Additionally, LIN TV Corp. and GE agreed to fund interest coverage shortfalls with loans based on LIN's ownership interests (LIN 20% / GE 80%). Ratings hinge on Moody's expectation that LIN will utilize free cash flow to reduce debt and leverage to increase its capacity to finance an acquisition or other dissolution of the NBC JV, particularly if it occurs prior to the 2023 GECC loan maturity. Under most scenarios, an acquisition or dissolution of the NBC JV would be leveraging to LIN. The company's capacity to fund a transaction without exceeding leverage metrics expected in the B2 CFR (as would be the case if a transaction occurred in the near term) increases the longer it can forestall such an event. Moody's believes LIN could fund a transaction within the B2 rating by the end of 2014 or 2015 assuming free cash flow continues to be applied to reduce debt balances and assuming no additional downward revisions to the operating plan of the NBC JV. The stable rating outlook reflects Moody's expectation that LIN will track Moody's base case forecast with core revenues growing in the low single digit percentage range resulting in 2-year average debt-to-EBITDA ratios (includes political and non- political years) remaining below 5.75x over the rating horizon and good liquidity including continued capacity to fund an additional $6 million of estimated debt service shortfalls of the NBC JV through 2014. The outlook does not include significant increases in debt balances to fund additional acquisitions resulting in elevated debt-to-EBITDA ratios. Ratings could be downgraded if an advertising downturn, cash distributions to shareholders, additional debt financed acquisitions, or the dissolution of the NBC JV results in 2-year average debt-to-EBITDA ratios being sustained above 6.0x (including Moody's standard adjustments) over the next 12 to 18 months. Beyond 12 to 18 months, debt-to-EBITDA ratios would need to be reduced sufficiently below FYE2012 levels to maintain a B2 CFR and to position the company for a refinancing of debt maturing in 2017-2018 while providing financial flexibility to resolve NBC JV obligations. Deterioration in liquidity including diminished capacity to cover debt service shortfalls at the NBC JV (that increases near term risk of dissolution of the JV) or other cash requirements could also result in a downgrade. An upgrade is not likely until there is a clear path to resolution of the overhang related to the NBC JV. Recent Events On November 15, 2012, the company launched LIN Mobile to provide mobile marketing solutions for clients nationwide. Management continues to add to its digital platform having acquired Nami Media in 2011 and RIMM in 2009. On November 14, 2012, the company extended its $25 million stock repurchase program to November 2013 from November 2012. A total of roughly $15 million has been repurchased since November 2011 leaving $10 million available under the program. The principal methodology used in rating was the Broadcast and Advertising Related Industry Methodology published in May 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. LIN Television Corporation is headquartered in Providence, RI, and owns or operates 43 television stations plus 7 digital channels in 23 mid-sized U.S. markets ranked #22 to #188 reaching 10.6% of U.S. television households. In addition, LIN TV Corp., the company's parent, owns 20% of KXAS-TV in Dallas, TX and KNSD-TV in San Diego, CA, through a joint venture with NBCUniversal Media, LLC ("NBC JV"). HM Capital Partners LLC ("HMC") holds an approximate 42% economic interest in LIN and approximately 70% of voting control is held by HMC and Mr. Royal Carson III, a LIN director and advisor for HMC. The company is expected to generate approximately $550 million of net revenues for the fiscal year ended December 2012 (includes acquisition of New Vision from October 12, 2012) LOS ANGELES DODGERS: Payroll More Than Doubled ---------------------------------------------- The Wall Street Journal reports the Los Angeles Dodgers' payroll for next season is up into the $220 million range -- easily the largest in history. WSJ, citing Cot's Baseball Contracts, relates the Dodgers opened last season with a payroll around $105.4 million. About Los Angeles Dodgers Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a professional Major League Baseball club in the Los Angeles metropolitan area. Frank McCourt, a Boston real-estate developer who unsuccessfully bid for the Boston Red Sox, bought the Dodgers from Rupert Murdoch's Fox Entertainment Group Inc. in 2004 for $330 million. Mr. McCourt also bought the Dodgers Stadium from Fox for $100 million. Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB Commissioner Bud Selig rejected a television deal with News Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for June 30 and July 1. Fox Sports has exclusive cable television rights for Dodgers games until the end of 2013 baseball season. Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies. According to Forbes, the Dodgers is worth about $800 million, making it the third most valuable baseball team after the New York Yankees and the Boston Red Sox. Judge Kevin Gross presides over the case. Lawyers at Young, Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the claims and notice agent. Public relations specialist Kekst and Company has been hired for crisis support. Covington & Burling LLP serves as special counsel. An official committee of unsecured creditors has been appointed in the case. The panel has tapped Lazard Freres & Co. as financial adviser and investment banker, and Morrison & Foerster LLP and Pinckney, Harris & Weidinger, LLC as counsel. The LA Dodgers is the 12th sports team in North America to have sought bankruptcy protection. The reorganization is being financed with a $150 million unsecured loan from the Commissioner of Major League Baseball. The loan gives the Commissioner few of the controls lenders often demanded from bankrupt companies. The Dodgers emerged from bankruptcy on April 30, 2012. The plan is based on a $2.15 billion sale of the baseball club and Dodger Stadium to Guggenheim Baseball Management. The plan pays all creditors in full, with the excess going to Mr. McCourt. LRM MANAGEMENT: Case Summary & Largest Unsecured Creditor --------------------------------------------------------- Debtor: LRM Management, Inc. 510 W. Wise Road Schaumburg, IL 60193 Bankruptcy Case No.: 12-48418 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court Northern District of Illinois (Chicago) Judge: Janet S. Baer Debtor's Counsel: Ben L. Schneider, Esq. SCHNEIDER & STONE 8424 Skokie Boulevard, Suite 200 Skokie, IL 60077 Tel: (847) 933-0300 Fax: (847) 676-2676 E-mail: ben@windycitylawgroup.com Scheduled Assets: $1,200,000 Scheduled Liabilities: $2,889,000 The petition was signed by Lajpat R. Madan, president. The Company's list of its largest unsecured creditors filed with the petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Colony BMO Funding Location: 506-610 $2,710,000 c/o Polsinelli Shughart PC W. Wise Road 161 N. Clark Street, Suite 4200 Schaumberg, IL Chicago, IL 60601 60193 MEDFORD VILLAGE EAST: Ordered to Pay $6.4MM to Lennar ----------------------------------------------------- PhillyBurbs.com reports that U.S. District Judge Gloria M. Burns dismissed an application by developer Medford Village East Associates and ordered the company to pay $6 million plus $400,000 in interest to Lennar Corp. The report notes Lennar challenged the application and requested the ability to move forward with a planned foreclosure of Medford's property, a 280-acre property that had been the site of multiple failed attempts at development by Medford Village East since the mid-1990s. Lennar, a division of national builder U.S. Home Corp. of Miami, paid Medford Village East a $6 million deposit in 2006 on a $60 million agreement of sale for the property, according to court documents. The sale never was completed, and the deposit has not been returned, according to Lennar. The deed belongs to Medford Village East. The developer filed for bankruptcy in August while reorganizing, claiming it was "unable to pay its debts as they mature." The report says Lennar's representatives argued that the filing was made in "bad faith in a last-ditch attempt" to halt foreclosure. Medford Village East Associates, LLC, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 12-29693) in Camden on Aug. 8, 2012. The Debtor owns properties in Medford Township, Mt. Laurel Township, Borough of Clayton, Borough of Barrington, Voorhees Township and the Midwest. The Debtor hired Maschmeyer Karalis P.C. as bankruptcy counsel and Hyland Levin, LLP as special counsel. The petition was signed by Stephen D. Samost, managing member. The Debtor scheduled $65,951,199 in assets and $9,976,003 in liabilities. METRO ANESTHESIA: Case Summary & 5 Unsecured Creditors ------------------------------------------------------ Debtor: Metro Anesthesia Services Inc. 1275 Shiloh Road, Suite 2120 Kennesaw, GA 30144 Bankruptcy Case No.: 12-80491 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court Northern District of Georgia (Atlanta) Judge: James Massey Debtor's Counsel: Lindsay C. Roach, Esq. LINDSAY ROACH, P.C. 1812 Keheley Court Marietta, GA 30066 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 A copy of the Company's list of its five unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/ganb12-80491.pdf The petition was signed by Glen Horne, president. MONITOR CO: Wins Final Approval of $15-Mil. Financing ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Monitor Co. Group LP received final approval last week for $15 million in secured financing along with a $12.7 million standby letter of credit facility. According to the report, there will be an auction on Jan. 9 to determine if anyone tops the $116.2 million bid from Deloitte Consulting LLP. Competing bids are due Jan. 7. A hearing to approve the sale was scheduled for Jan. 11. The report relates that Deloitte's offer includes the assumption of specified debt and cash to cure payment defaults on contracts going along with the sale. About Monitor Company Group Monitor Company Group LP -- http://www.monitor.com/-- is a global consulting firm with 1,200 personnel in offices across 17 countries worldwide. Founded in 1983 by six entrepreneurs, and headquartered in Cambridge, Massachusetts, Monitor advises for- profit, sovereign, and non-profit clients on growing their businesses and economies and furthering their charitable purposes. Monitor and several affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 12-13042 to 12-13062) on Nov. 7, 2012. Judge Hon. Christopher S. Sontchi presides over the case. Pepper Hamilton LLP and Ropes & Gray LLP serve as the Debtors' counsel. The financial advisor is Carl Marks Advisory Group LLC. Epiq Bankruptcy Solutions, LLC is the claims and noticing agent. The petitions were signed by Bansi Nagji, president. Bank of America is represented in the case by Jinsoo Kim, Esq., and Timothy Graulich, Esq., at Davis Polk & Wardwell LLP; and Mark D. Collins, Esq., at Richards Layton & Finger PA. J. Gregory Milmoe, Esq., and Shana A. Elberg, Esq., at Skadden Arps Slate Meagher & Flom LLP in New York; and Mark Chehi, Esq., and Christopher DiVirgilio, Esq., at Skadden Arps in Delaware, represent Deloitte Consulting LLP. Caltius Partners IV LP; Caltius Partners Executive IV, LP; and CP IV Pass-Through (Monitor) LP are represented by John Sieger, Esq., at Katten Muchin Rosenman LLP. Monitor's consolidated unaudited financial statements as of June 30, 2012, which include the assets and liabilities of non- Debtor foreign subsidiaries, reflected total assets of roughly $202 million (including $93 million in current assets) and total liabilities of roughly $200 million. Monitor filed for bankruptcy to sell substantially all of their businesses and assets to Deloitte Consulting LLP, a Delaware registered limited liability partnership and DCSH Limited, a UK company limited by shares, subject to higher or otherwise better offers. The base purchase price set forth in the Stalking Horse Agreement is $116.2 million, plus (i) assumption of certain liabilities and (ii) certain cure costs for assumed contracts. The Stalking Horse Agreement provides for the Stalking Horse Bidder to receive a combined breakup fee and expense reimbursement of $4 million. The Debtors propose to hold an auction on Nov. 28, 2012, at the offices of the Sellers' counsel, Ropes & Gray LLP in New York. Closing of the deal must occur by the earlier of (i) 30 days following entry of the Sale Order and (ii) Feb. 28, 2013. NATIONAL POOL: NJ Bankr. Court Admits Error in Dismissing Lawsuit ----------------------------------------------------------------- In the lawsuit, National Pool Construction, Inc. Liquidating Trust Plaintiff, v. The Provident Bank, John Does 1-10, and XYZ Corporations 1-10, Defendant(s), Adv. Proc. No. 11-2643 (Bankr. D. N.J.), Bankruptcy Judge Kathryn C. Ferguson gave the parties 60 days to complete any additional discovery and then 30 days thereafter to file any summary judgment motions that are deemed appropriate. The lawsuit was reinstated by the District Court earlier this year after the Trust appealed the Bankruptcy Court's March 14, 2012 order dismissed the adversary complaint. In dismissing the lawsuit, the Bankruptcy Court noted that the Chapter 11 case was filed on Sept. 16, 2009, therefore, the deadline to file a complaint under 11 U.S.C. Sec. 546(a)(1) was Sept. 16, 2011. The complaint was not filed until Dec. 5, 2011; and was thus time barred, according to the Bankruptcy Court. The Court rejected the Trust's legal arguments that Sec. 550 was an independent cause of action, and that the New Jersey Fraudulent Transfer Act provided a longer statute of limitations. The District Court questioned whether the Bankruptcy Court applied the appropriate standard in deciding the motion to dismiss. The District Court vacated the dismissal order and remanded the case for further proceedings. On Monday, Judge Ferguson acknowledged the Bankruptcy Court did apply an incorrect legal standard in deciding whether the Trust's failure to timely file a complaint should be forgiven under the doctrines of equitable tolling and adverse domination. "The concept of adverse domination is an equitable tolling doctrine that will allow for the statute of limitations to be tolled where the corporate entity is controlled by the alleged wrongdoers," the Court noted, citing In re O.E.M./Erie, Inc., 405 B.R. 779 (Bankr. W.D. Pa. 2009). The Trust argued that "[u]nder the doctrine of adverse dominion, any limitations period would be tolled and not begin to run until the Debtor, controlled by the Shareholders, was no longer in control of pursuing avoidance actions. Thus, the Complaint was timely filed because any limitations period was automatically tolled and did not begin to run until the Effective Date of the Plan when the Liquidating Trust was created and assigned avoidance actions." The effective date of the Chapter 11 plan was August 29, 2011. That was two weeks prior to the Sept. 16, 2011, deadline for filing a complaint. A copy of Judge Ferguson's Dec. 10, 2012 Memorandum Opinion is available at http://is.gd/CO46n9from Leagle.com. George M. Pangis, Esq. -- gpangis@norgaardfirm.com -- at Norgaard O'Boyle, in Englewood, New Jersey, argues for Provident Bank. Robbinsville, New Jersey-based National Pool Construction, Inc. -- dba National Pools & Spas; and National Award Winning Pools & Spas -- filed for Chapter 11 bankruptcy (Bankr. D. N.J. Case No. 09-34394) on Sept. 16, 2009. Judge Kathryn C. Ferguson oversees the case. Peter Broege, Esq. -- pbroege@bnfsbankruptcy.com -- at Broege, Neumann, Fischer & Shaver, represented the Debtor. The Debtor scheduled total assets of $2,437,219, and total debts of $2,628,531. A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at http://bankrupt.com/misc/njb09-34394.pdf The petition was signed by Ronald Burrell, president of the Company. A Liquidating Trust has been established under the Debtor's confirmed plan. The plan was declared effective Aug. 29, 2011. Courtney A. Schael, Esq. -- cschael@AshfordNJLaw.com -- at Ashford Schael LLC, in Westfield, represents the Trust. NETFLIX INC: Moody's Cuts CFR/PDR to 'Ba3'; Outlook Stable ---------------------------------------------------------- Moody's Investors Service downgraded Netflix, Inc.'s Corporate Family Rating (CFR) to Ba3 from Ba2, Probability of Default Rating to Ba2 from Ba1, and the rating on its senior unsecured notes to Ba3 (LGD5-70%). This action concludes the review for downgrade initiated on October 9, 2012. The rating outlook is stable and the Speculative Grade Liquidity rating remains unchanged at SGL-1. The downgrade reflects the higher risk surrounding the company's shift to a fixed cost streaming business model which requires much higher subscriber levels to reach profitability, combined with an increasingly competitive operating environment. While Netflix's initial Ba2 CFR, assigned in 2009, considered the risk associated with the company's ability to transition from physical DVD rentals to digital streaming, it did not consider the higher risk associated with a shift from a variable cost model to a fully fixed cost structure for the streaming business. Though the company has exceeded Moody's expectations for its transition to a digital model, albeit with some missteps that resulted in an accelerated and harmful decline of its DVD business, and has grown subscribers at a higher than expected rate, it now faces a much higher cost business model that requires a far higher number of subscribers to reach break even. At the same time, streaming content is now becoming much more competitive. In Moody's view, in order to maintain the same level of financial strength and reach a similar level of profitability as Netflix previously had under its DVD business when Moody's initially rated it in 2009, Netflix would need to have at least 35 million domestic streaming subscribers, almost double the level of DVD subscribers it had at its peak. This is even before considering the additional risk associated with the fixed content costs and therefore the greater vulnerability of the streaming business to poor growth or declines in subscriber growth. Though Moody's recognizes that the company may be able to cut back on new content additions and renewals to reduce content costs if subscriber growth slows down from one year to the next. In addition, Moody's believes streaming-only subscribers are less sticky than those that subscribed to the company's now discontinued hybrid offering, which makes it all the more important to maintain a superior product relative to competition, and increasing viewer engagement to drive customer retention. The downgrade also reflects Moody's concern over growing competition from a broad range of competitors for a streaming subscription video-on-demand (SVOD) product. While the streaming business is more sustainable from the standpoint of changing technology, maintaining product quality and user experience, it lacks the complete content offering, including new film releases that could be viewed via DVD rentals. As content distribution and consumption trends continue to evolve, and the home entertainment market declines further, Moody's believes it is possible that a competitor could emerge with an offering that fills in the void of new releases, which could be of greater value to customers. The company already faces a broad range of competitors, some of which have deep pockets and who may have different objectives for entering the business, and may be willing to undermine Netflix on both price and product offering and suffer a loss to gain subscribers. For example, a pay-TV provider may want to build a competitive offering in order to drive subscriber retention for its larger, profitable pay-TV distribution business, or, the giant retailer Amazon with its Amazon Prime SVOD service may wish to attract subscribers to drive retail sales and tablet sales. However, Moody's believes that as long as Netflix can continue to materially outspend its competitors for content and build a large enough library with increasingly exclusive content, which is supported by its large subscriber base and scale, it may be able to create a moat around its business and remain a leading player. Moody's also believes that with around 80 million broadband households in the US relative to Netflix's 25 million streaming subscribers, Moody's believes there is potential for higher penetration and scope for multiple players to co-exist in the content streaming business. The company has also embarked on an international expansion strategy in the past two years, and plans to reinvest a majority of its domestic profits into international markets over the intermediate term, resulting in higher leverage and negative free cash flow on a consolidated basis. However, this does not impact the company's credit rating at this juncture, as investment in growth is more favorable to the company's credit standing than an alternative use of the company's cash flows such as engaging in share repurchases which serve no benefit for creditors. Moody's remains more focused on the profitability and sustainability of the core domestic business, as long as Netflix's international investments are not debt-financed and do not rapidly consume cash and impact liquidity. Another change over the past year has been the company's decision to produce original and exclusive content. While the downgrade of Netflix's ratings considers the possibility of a significant increase in spending on original programming, which may negatively impact ratings giving the riskier proposition of new content production, Moody's currently expects original programming to remain a small portion of its total content budget. The following is a summary of the actions: Issuer: Netflix, Inc. Corporate Family Rating, Downgraded to Ba3 from Ba2 Probability of Default Rating, Downgraded to Ba2 from Ba1 Senior Unsecured Notes, Downgraded to Ba3 (LGD5-70%) from Ba2 (LGD5-72%) Rating Rationale Netflix's Ba3 Corporate Family Rating reflects the company's position as the largest content streaming subscription service in the U.S., with a sizeable subscriber base and a market leading streaming product offering. It reflects the company's strong balance sheet, with very low gross domestic debt-to-EBITDA leverage of under 1.0x and a significant level of cash and short term investments relative to its debt. The above credit strengths only partially mitigate key business risks, however, including the company's relatively young history, business concentration, and risks associated with low barriers to entry and the potential for disintermediation from competitors in the distribution of content. The company's past predisposition for share repurchases (having repurchased almost $1 billion since 2007), significant subscriber churn and relatively low EBITDA margins compared to traditional media also weigh on its rating. Although Netflix has successfully developed a digital business model and has quickly evolved into the dominant online content streaming company in the US from a pure physical DVD rental subscription service, its business continues to be in transition with the next few years being crucial to its developing a profitable streaming business that can fully offset the rapidly declining profits from the high margin DVD business. Its Ba3 CFR reflects the execution risk associated with this transition, especially in the context of a broad range of emerging competitors and the evolving digital content distribution models that may hamper the subscriber growth it needs in order to successfully build a profitable streaming business. The rating reflects Moody's expectation that the company will reinvest a majority of its domestic profits into international expansion. Moody's does not view these investments negatively, as long as it remains measured in its pace of international market launches and does not fund these via debt financing or consuming material amounts of its cash balance. However, combined with its increasing investments in original programming, the company may reduce the cushion that has existed to support new and existing content contractual commitments in the event of slower than expected subscriber growth or subscriber losses. The company's Ba3 rating is limited by its ability to demonstrate enough subscriber growth to meet (a) the content commitments and expenditures to offer a streaming plan that would enable it to maintain a significant lead ahead of competitors and (b) its investments in international markets while maintaining strong liquidity. Moody's believes that it would be possible to do so if the company grows to around 40 million subscribers in the US and is able to maintain at least break even cash flow in international markets, with profitable launched markets funding the launch of new markets. The stable outlook reflects Moody's forecast that the company will grow domestic streaming subscribers in the range of 4-5 million per year over the next two years, and maintain its pace of additions relative to competitors such that it remains at least double the size of the next largest competitor, while managing content costs so as to increase its streaming margin. The outlook does not contemplate the company's international businesses to contribute to profitability well into the intermediate term. The company's rating may face downward pressure if it experiences domestic streaming subscriber growth of under 4 million per year, and is unable to maintain domestic margins above 12% (after allocating most of the overhead to domestic) by growing streaming profits to offset declining DVD profits. Ratings may also be downgraded if its domestic leverage is sustained over 2.0x or consolidated leverage is sustained over 5.0x as it launches expands internationally, or its international investments materially impact liquidity or require debt financing. Ratings may be upgraded if the company can demonstrate a successful transition to a profitable domestic streaming business, with subscriber growth that allows it to reach and sustain 40 million streaming subscribers, manage content spend such that it increases and sustains domestic margins at above 16% as well as maintains a significant lead on its content offering relative to competitors, and if its profitable international markets can fund new market launches such that gross consolidated leverage remains below 2.0x. Netflix's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside Netflix's core industry and believes Netflix's ratings are comparable to those of other issuers with similar credit risk. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. NEW YORK TIMES: S&P Raises Senior Notes Rating to 'BB-' ------------------------------------------------------- Standard & Poor's Ratings Services raised its issue-level rating on New York City-based The New York Times Co.'s senior notes to 'BB-' from 'B+' (one notch above the 'B+' corporate credit rating). "At the same time, we revised our recovery ratings on this debt to '2', indicating our expectation for substantial (70% to 90%) recovery for lenders in the event of a payment default, from '4'," S&P said. "These rating actions reflect our expectation for slightly better recovery prospects, following the recent termination of the $125 million asset-based revolving credit facility due 2016 and, correspondingly, our anticipation for a lower balance of outstanding borrowings in our simulated default scenario. We expect that the company will not replace the revolving credit with another secured facility due to its large cash balances. We believe cash will exceed $900 million at year-end 2012 as proceeds from recent asset sales have not been redeployed. We also anticipate that cash balances will remain sizeable over the next few years, based on our belief that the company will preserve liquidity in light of the weak operating outlook. The company remains heavily exposed to unfavorable secular trends affecting newspaper print advertising and circulation, despite efforts to increase the contribution from digital revenue streams," S&P said. RATINGS LIST The New York Times Co. Corporate Credit Rating B+/Stable/-- Upgrade; Recovery Rating Revision The New York Times Co. To From Senior notes BB- B+ Recovery Rating 2 4 NEWPORT TELEVISION: S&P Withdraws 'B-' Corporate Credit Rating -------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings, including its 'B-' corporate credit rating, on Newport Television Holdings LLC at the company's request. The company repaid all of its debt following the sale of 22 television stations to Sinclair Broadcast Group Inc. (BB-/Stable/--); Nexstar Broadcasting Group Inc. (B+/Stable/--); and Cox Media Group Inc., a subsidiary of Cox Enterprises Inc. (BBB/Stable/A-2) on Dec. 3, 2012. OCEAN BREEZE: Cash Collateral Use OK'd; Hearing Set for Dec. 19 --------------------------------------------------------------- The Hon. Erik P. Kimball of the U.S. Bankruptcy Court for the Southern District of Florida has granted Ocean Breeze Park Homeowners' Association, Inc., authorization to use the cash collateral of lenders Cathie Teal, Gary Hendry, and Marcia Hendry- Coker. The Court continued until Dec. 19, 2012, at 1:30 p.m., the hearing to consider the Debtor's request for continued cash collateral use. As reported by the Troubled Company Reporter on Oct. 25, 2012, the Debtor, at the onset of its case, made an emergency request seeking Court permission to use cash collateral of the Lenders to continue its business operations. Without the use of the Cash Collateral, the Debtor said it will be forced to discontinue its business operations. As of the bankruptcy filing date, the lenders allege that the Debtor owed them $25,309,718, including $904,402 in accrued and unpaid interest pursuant to two Promissory Notes and Security Agreements dated Dec. 12, 2008. The debt is secured by, among other things, Purchase Money Mortgage and Security Agreements. As condition of permitting the Debtor to use cash collateral, the Debtor will maintain a separate debtor-in-possession tax account and will deposit into the tax account the amounts needed for the Martin County ad valorem and non-ad valorem real estate taxes for the subject real property in the aggregate monthly amount of $35,000 with proceeds of the account first being used to pay the 2010 real estate taxes due for the subject real property. The Debtor is required to make adequate protection payments of $55,000 on Nov. 15, 2012, and on Dec. 15, 2012. There is no grace period for any of these payments. As security for all indebtedness that is owed to the Lenders, the Debtor grants the Lenders a postpetition replacement lien in cash collateral. About Ocean Breeze Park Homeowners' Association Jensen Beach, Florida-based Ocean Breeze Park Homeowners' Association, Inc., filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-28820) in West Palm Beach on Aug. 3, 2012. Bankruptcy Judge Erik P. Kimball presides over the case. Ocean Breeze Park Homeowners' Association operates a residential cooperative mobile home park located at 3000 N.E. Indian River Drive, Jensen Beach. The shareholders have equity ownership in the Cooperative, allowing them to hold proprietary leases which provide for 99-year leasehold agreements. There are 549 mobile home units, 39 cottages and 16 recreational vehicle units. There are 137 units subject to the proprietary leases. Bankruptcy Judge Erik P. Kimball presides over the case. Lawyers at Furr and Cohen, P.A., serve as the Debtor's counsel. In its schedules, the Debtor disclosed $13,472,535 in assets and $24,870,355 in liabilities. The petition was signed by Harry Bartlett, president. OCEAN BREEZE: Taps Ross Earle for State Law Litigation Issues ------------------------------------------------------------- Ocean Breeze Park Homeowners' Association, Inc., asks the Hon. Erik P. Kimball of the U.S. Bankruptcy Court for the Southern District of Florida for authorization to employ the law firm of Ross, Earle & Bonan, P.A., as special counsel, to appear on behalf of the Debtor in cases in state court regarding eviction and demolition issues and to proved legal advice regarding state law litigation issues and general homeowner association issues. The Debtor is a residential cooperative mobile home park in Jensen Beach, Florida. There are pending issues regarding evictions and demolition of properties in deplorable condition within the Park and the Debtor seeks to pursue actions in the state court to resolve these issues. The Debtor requires Ross Earle's assistance regarding homeowner association law and related issues. Ross Earle will be paid $275 per hour for its services, and will be paid a postpetition retainer of $10,000. Deborah L. Ross, Esq., a member at Ross Earle, attests to the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Ross Earle can be reached at: Janice McPheeters, Office Administrator Ross, Earle & Bonan, P.A. Post Office Box 2401 Stuart, FL 34995 Tel.: (772)287-1745 Fax: (772)287-8045 E-mail: jm@reblawpa.com About Ocean Breeze Park Homeowners' Association Jensen Beach, Florida-based Ocean Breeze Park Homeowners' Association, Inc., filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 12-28820) in West Palm Beach on Aug. 3, 2012. Bankruptcy Judge Erik P. Kimball presides over the case. Ocean Breeze Park Homeowners' Association operates a residential cooperative mobile home park located at 3000 N.E. Indian River Drive, Jensen Beach. The shareholders have equity ownership in the Cooperative, allowing them to hold proprietary leases which provide for 99-year leasehold agreements. There are 549 mobile home units, 39 cottages and 16 recreational vehicle units. There are 137 units subject to the proprietary leases. Bankruptcy Judge Erik P. Kimball presides over the case. Lawyers at Furr and Cohen, P.A., serve as the Debtor's counsel. In its schedules, the Debtor disclosed $13,472,535 in assets and $24,870,355 in liabilities. The petition was signed by Harry Bartlett, president. ORCHARD SUPPLY: S&P Lowers CCR to 'CCC' on Covenant Risk -------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on San Jose, Calif.-based home and garden retailer Orchard Supply Hardware LLC to 'CCC' from 'B-'. The outlook is negative. "We are also lowering our rating on the company's term loan to 'CCC' from 'B-' in conjunction with the downgrade. The recovery rating remains '4' recovery rating, indicating our expectation for average (30% to 50%) recovery in the event of a payment default," S&P said. "The ratings on Orchard Supply reflects Standard & Poor's Ratings Services' assessment of its financial risk profile as 'highly leveraged,' which incorporates near-term potential for noncompliance with financial covenants and significant debt refinancing risks. Our view of its business risk profile as 'vulnerable' considers the company's small size relative to the highly competitive home improvement segment of the retail industry and its exposure to housing market conditions in California," S&P said. "Orchard Supply announced that it would likely not be in compliance with its term loan leverage covenant for the Feb. 2, 2013, testing period, and it is currently working with a third- party adviser to refinance or modify the loan before year-end. The covenant compliance risk heightens more in the second quarter of 2013 when the leverage tests becomes tighter. Additionally, if the company does not refinance the term loan on a timely basis, then the revolver expiration date will accelerate to 90 days prior to the term loan maturity in December 2013," S&P said. "The negative outlook reflects the company's covenant compliance situation next year and risks associated with refinancing the 2013 maturities," said Standard & Poor's credit analyst Andy Sookram. "We could lower the ratings if the company fails to address its refinancing risks in a timely manner, which could tighten liquidity from current levels." "We could revise the outlook to stable after completion of the refinancing for the company's debt coming due and if the company demonstrates improvement in its operating performance, including revenue and margin growth, which we expect would result in adequate covenant cushion. In this scenario, revenues would grow about 5% and EBITDA margins would increase to around 11% to 12%," S&P said. OVERSEAS SHIPHOLDING: Greylock Partners to Lead Reorganization -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Overseas Shipholding Group, Inc., et al., to (i) designate Greylock Partners, LLC's John J. Ray, III as chief reorganization officer; and (ii) employ Greylock Partners to support the reorganization efforts of the Debtors. As reported in the Troubled Company Reporter on Dec. 4, 2012, Mr. Ray established the firm and serves as its senior managing director. Mr. Ray has provided a full range of crisis management services throughout North America to under-performing companies, including interim management and debtor advisory work; bankruptcy preparation and management; litigation support; post-merger integration; and debt restructuring and refinancing. Mr. Ray has previously served as interim chief executive officer, chief reorganization officer and in similar roles for various public and private companies, including Enron Corp. and Nortel Networks Inc. Greylock will bill on an hourly basis based on the actual hours worked pursuant to current hourly billing rates, which range from $150 for an associate to $595 for a senior managing director. The hourly rates for Mr. Ray and the Additional Personnel anticipated to be assigned to the case matter and their hourly rates are: Name Description Hourly Rate ---- ----------- ----------- John J. Ray, III Sr Managing Director $595 Richard Lydecker Managing Director $550 Kathryn Schultea Managing Director $550 Raj Perubhatla Senior Director $500 Mary Cilia Senior Director $500 Charrise Fraccascia Director $425 Terry Smith Director $425 David Kantorczyk Director $425 Brandon Bangerter Director $425 Roger Smith Associate $225 Felicia Buenrostro Associate $150 Greylock will be reimbursed for all reasonable, documented, out- of-pocket expenses incurred during this engagement. Prior to the Petition Date, Greylock received an evergreen retainer of roughly $250,000 from the Debtors. Greylock also received advances prior to the Petition Date which amount is outstanding as of the Petition Date of $853,179. Mr. Ray attests neither Greylock nor any professional employee or independent contractor of Greylock has any connection with or any interest adverse to the Debtors, their significant creditors, or any other significant party in interest known to Greylock, or their attorneys and accountants; and that Greylock is a "disinterested person" as that term is defined by Section 101(14) of the Bankruptcy Code. About Overseas Shipholding Overseas Shipholding Group, Inc., headquartered in New York, is one of the largest publicly traded tanker companies in the world, engaged primarily in the ocean transportation of crude oil and petroleum products. OSG owns or operates 111 vessels that transport oil and petroleum products throughout the world. Overseas Shipholding Group and 180 affiliates filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on Nov. 14, 2012. Bankruptcy Judge Peter J. Walsh oversees the case. Greylock Partners LLC Chief Executive John Ray serves as chief reorganization officer. Cleary Gottlieb Steen & Hamilton LLP serves as OSG's Chapter 11 counsel, while Chilmark Partners LLC serves as financial adviser. The Debtors disclosed $4.15 billion in assets and $2.67 billion in liabilities as of June 30, 2012. Liabilities include $1.49 billion on an unsecured credit agreement with DNB Bank ASA as agent. In addition to the secured Chinese loan, there is $518 million in unsecured notes and debentures plus $267 million on ship mortgages taken down to finance nine vessels. The Export-Import Bank of China, owed $312 million used for the construction of five tankers, is represented by Louis R. Strubeck, Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at Fulbright & Jaworski in New York; and John Knight, Esq., and Christopher Samis, Esq., at Richards Layton & Finger PA. PARAGON SHIPPING: Obtains Waivers From Four Lenders --------------------------------------------------- Paragon Shipping Inc. (NYSE: PRGN) has signed agreements with four of its lenders, subject to certain conditions, and agreed to amended terms in the following loan agreements: the loan agreement with Unicredit Bank AG dated Nov. 19, 2007, the loan agreement with The Bank of Scotland Plc dated Dec. 4, 2007, the loan agreement with Bank of Ireland dated March 30, 2009, and the loan agreement with HSBC Bank Plc dated July 2, 2010. More specifically, the Company obtained waivers and agreed to the relaxation of several financial and security coverage ratio covenants, the deferral of a portion of its scheduled quarterly installments and, in the case of the loan agreement with Bank of Ireland and The Bank of Scotland Plc, the extension of the loan agreements to the second quarter of 2017 and to the third quarter of 2015, respectively. In addition, in respect to the loan agreement with The Bank of Scotland Plc, the Company agreed to a payment of $2.8 million for the full and final settlement of $4.7 million in debt, representing the portion of the loan of one of the syndicate members. This advance payment of $2.8 million was made on December 10, 2012. Paragon Shipping -- http://www.paragonship.com/-- is a Marshall Islands-based international shipping company with executive offices in Athens, Greece, specializing in the transportation of drybulk cargoes. The Company's current fleet consists of twelve drybulk vessels with a total carrying capacity of 779,270 dwt. In addition, the Company's current newbuilding program consists of two Handysize drybulk carriers that are scheduled to be delivered in 2013 and two 4,800 TEU containerships that are scheduled to be delivered in 2014. PEAK RESORTS: Plan Filing Exclusivity Extended to March 29 ---------------------------------------------------------- The Hon. Margaret Cangilos-Ruiz of the U.S. Bankruptcy Court for the Northern District of New York has extended, at the behest of debtors Peak Resorts, Inc., et al., the exclusive periods for the Debtors to file a plan until March 29, 2013, and solicit acceptances of that plan until May 28, 2013. In the motion seeking an extension, the Debtors said that they need to have some additional exclusive breathing room to propose a plan. "This is a very complex case that has not been pending for any significant length of time. Additionally, there is no evidence that the Debtors have requested this extension to pressure or coerce their creditors into acceding to the Debtors' reorganization demands," the Debtors stated. The Debtors said they have been working diligently in stabilizing their customer base and operations while exploring various reorganization and sale options. That process, according to the Debtors, will continue with the input from the FDIC-Receiver and the Unsecured Creditors Committee in an attempt to maximize the recovery to all of the parties. The Debtors will be hiring a professional in the immediate future, to attempt to locate a potential purchaser or investor that will solidify the Debtors' reorganization/restructuring plans or a sale of the Debtors' assets. The Debtors have sought and obtained the appointment of American Resort Management, LLC, to evaluate and streamline the Debtors' operations. About Peak Resorts Peak Resorts, Inc., dba Greek Peak Mountain Resort, and four affiliates filed for Chapter 11 bankruptcy (Bankr. N.D.N.Y. Case Nos. 12-31471 to 12-31473, 12-31475 and 12-31476) in Syracuse on Aug. 1, 2012. The affiliates are Hope Lake Investors LLC, V.R.P.D. II L.P., REDI LLC, and A.R.K. Enterprises Inc. Peak Resorts owns 888.5 acres of real estate, including the "Greek Peak Mountain Resort", a four-season resort development located in Virgil, New York. The 888.5-acre property is located 8 miles from Cortland, New York and has the largest day trip area in Central New York state. REDI LLC owns 402.7 acres of adjacent property. Hope Lake Investors owns the Hope Lake Lodge & Cascades Indoor Water Park, a 151-room hotel and resort facility in Virgil, Cortland County. The Debtors have a total of 264 employees. Chief Bankruptcy Judge Robert E. Littlefield Jr. presides over the case. Lawyers at Harris Beach PLLC serve as the Debtors' counsel. The Debtors scheduled these assets and debts: Scheduled Assets Scheduled Liabilities ---------------- --------------------- Hope Lake $27,180,635 $48,800,528 Peak Resorts $12,991,230 $26,558,438 REDI, LLC $1,298,401 $3,851,808 The petitions were signed by Allen R. Kryger, president. PEMCO WORLD: Court Extends Plan Exclusivity to Jan. 4 ----------------------------------------------------- The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware extended, at the behest of WAS Services, Inc., formerly known as Pemco World Air Services, Inc., the exclusive period to file a Chapter 11 plan and solicit acceptances of such plan to Jan. 4, 2013, and March 4, 2013, respectively. The Debtors noted that they have (i) consummated the sale of substantially all of their assets to Avion Services Holdings, LLC, (ii) concluded their remaining operations and taken substantial steps to wind down their facilities, and (iii) filed, along with Sun Aviation, a Joint Plan of Reorganization and Disclosure Statement. About Pemco World Headquartered in Tampa, Florida Pemco World Air Services -- http://www.pemcoair.com/-- performs large jet MRO services, and has operations in Dothan, AL (military MRO and commercial modification), Cincinnati/Northern Kentucky (regional aircraft MRO), and partner operations in Asia. Pemco filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case No. 12-10799) on March 5, 2012. Young Conaway Stargatt & Taylor, LLP has been tapped as general bankruptcy counsel; Kirkland & Ellis LLP as special counsel for tax and employee benefits issues; AlixPartners, LLP as financial advisor; Bayshore Partners, LLC as investment banker; and Epiq Bankruptcy Solutions LLC as notice and claims agent. On March 14, 2012, the U.S. Trustee appointed an official committee of unsecured creditors. On April 13, 2012, Sun Aviation Services LLC (Bankr. D. Del. Case No. 12-11242) filed its own Chapter 11 bankruptcy petition. Sun Aviation owns 85.08% of the stock of Pemco debtor-affiliate WAS Aviation Services Holding Corp., which in turn owns 100% of the stock of debtor WAS Aviation Services Inc., which itself owns 100% of the stock of Pemco World Air Services Inc. Pemco also owes Sun Aviation $5.6 million. As a result, Sun Aviation is seeking separate counsel. However, Sun Aviation obtained an order jointly administering its case with those of the Pemco debtors. On June 15, the bankruptcy court approved sale of Pemco's business for $41.9 million cash to an affiliate of VT Systems Inc. from Alexandria, Virginia. Boca Raton, Florida-based Sun Capital was under contract to make the first bid at auction for the provider of heavy maintenance and repair services for commercial jet aircraft. PERRY ELLIS: Moody's Says Dividend Modestly Neg. for Liquidity -------------------------------------------------------------- Moody's Investors Service said that Perry Ellis International, Inc.'s announcement of a $16 million one-time dividend is modestly negative for liquidity but has no immediate impact on its ratings or outlook. As reported by the Troubled Company Reporter on April 2, 2012, Moody's Investors Service affirmed all existing ratings of Perry Ellis International, Inc. including the B1 Corporate Family Rating, the B1 Probability of Default Rating and the B2 senior subordinated notes rating. Moody's also assigned a first time speculative grade liquidity rating of SGL-2. The outlook remained stable. Perry Ellis International, Inc., headquartered in Miami, Florida designs, distributes and licenses apparel and accessories for men and women. The company, through its wholly owned subsidiaries, owns or licenses a portfolio of brands that includes Perry Ellis, Rafaella, Laundry by Shelli Segal, Original Penguin, Cubavera, and Nike Swim. While the company is predominantly an apparel wholesaler, it also operates roughly 70 of its own retail stores. Revenues for the fiscal year ended October 27, 2012 were about $940 million. PHOENIX COMPANIES: Indenture Changes Cues Fitch to Put 'B' IDR -------------------------------------------------------------- Fitch Ratings has placed the 'B' holding company Issuer Default Rating (IDR) of Phoenix Companies, Inc.'s (PNX) and the 'BB+' Insurer Financial Strength (IFS) ratings of PNX's primary insurance operating subsidiaries on Rating Watch Negative following the company's recent announcement that it seeks to amend the indenture of its $253 million of senior debt. PNX is seeking to extend the deadline for providing the third quarter 2012 financial statement to the trustee. Absent this extension, acceleration of the debt maturity could be triggered. The filing delay is due to restatements of certain financial data. The restatements are not expected to be material to the company's credit profile. Fitch will monitor the company's progress on amending the indenture. Fitch has placed the following ratings on Rating Watch Negative: Phoenix Companies, Inc. -- IDR 'B'. Phoenix Life Insurance Company -- IFS 'BB+'; -- IDR 'BB'; -- $174 million Surplus note 7.15% due Dec. 2034 'B+'. PHL Variable Insurance Company -- IFS 'BB+'. PLAY BEVERAGES: Sues Playboy for Breach of 2006 License Agreement ----------------------------------------------------------------- In April 2011, creditors filed an involuntary bankruptcy petition against Play Beverages, LLC, a consolidated variable interest entity of CirTran Corporation. Thereafter, this proceeding was converted into a Chapter 11 reorganization proceeding, with PlayBev acting as debtor-in-possession. PlayBev entered into a 2006 license agreement with Playboy Enterprises International, Inc., to market a Playboy-branded nonalcoholic energy drink. Among other things, Playboy has stated its position that PlayBev's 2006 license agreement has expired. PlayBev disputes Playboy's position and has filed litigation to protect its rights and business interests. In August 2012, PlayBev entered into two interdependent and contingent agreements with Playboy Enterprises International, Inc. Subject to confirmation of PlayBev's Chapter 11 plan of reorganization, certain payments to Playboy, and other conditions precedent, the proposed transaction would have resulted in both: (a) a settlement of all claims by and between PlayBev and Playboy; and (b) a new license agreement in favor of the anticipated reorganized debtor under PlayBev's proposed plan. PlayBev did not deposit into escrow by the agreed deadline the initial payment required to be paid to Playboy upon the effective date of PlayBev's proposed plan. Further, PlayBev did not obtain confirmation of its proposed plan and the agreements between PlayBev and Playboy were not approved by the bankruptcy court. As such, Playboy has declared the new, contingent license agreement to be void and without effect. Similarly, the conditions precedent to the effectiveness of PlayBev's settlement with Playboy did not occur. Accordingly, the proposed, contingent settlement and license agreements are ineffective and without any legal force or effect. As part of its efforts to develop a new plan of reorganization, Play Beverages, LLC, has proposed to Playboy Enterprises International, Inc., modified terms for a proposed new license to market Playboy-branded energy drinks, but no substantive discussions are underway. Meanwhile, motions to dismiss or convert PlayBev's reorganization case to a liquidation are scheduled to be heard in early December 2012. In October 2012, CirTran and PlayBev jointly filed a lawsuit in Chicago, Illinois, alleging various breaches by Playboy and others of the previous product license agreement and interference with the plaintiffs' established distributorship network and seeking compensatory and punitive damages, an injunction against termination of the previous product license and continuing interference, and other equitable and ancillary relief. Playboy and the other defendants have not responded to the lawsuit. About Play Beverages On April 26, 2011, three alleged creditors, LIB-MP Beverage, LLC, George Denney, and Warner K. Depuy, filed an involuntary Chapter 7 petition against Play Beverages, LLC, a consolidated entity of the Company, seeking its liquidation. On Aug. 12, 2011, the proceeding was converted into a Chapter 11 reorganization proceeding (Bankr. D. Utah Case No. 11-26046). PMI GROUP: Exclusive Filing Period Extended to Jan. 3, 2013 ----------------------------------------------------------- Judge Brendan L. Shannon the U.S. Bankruptcy Court for the District of Delaware has extended The PMI Group, Inc.'s exclusive period to file a plan of reorganization until Jan. 3, 2013, and its exclusive period to solicit acceptances of a filed plan until March 4, 2013. About The PMI Group The PMI Group, Inc., is an insurance holding company whose stock had, until Oct. 21, 2011, been publicly-traded on the New York Stock Exchange. Through its principal regulated subsidiary, PMI Mortgage Insurance Co., and its affiliated companies, the Debtor provides residential mortgage insurance in the United States. The PMI Group filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 11-13730) on Nov. 23, 2011. In its schedules, the Debtor disclosed $167,963,354 in assets and $770,362,195 in liabilities. Stephen Smith signed the petition as chairman, chief executive officer, president and chief operating officer. The Debtor said in the filing that it does not have the financial resources to pay the outstanding principal amount of the 4.50% Convertible Senior Notes, 6.000% Senior Notes and the 6.625% Senior Notes if those amounts were to become due and payable. The Debtor is represented by James L. Patton, Esq., Pauline K. Morgan, Esq., Kara Hammond Coyle, Esq., and Joseph M. Barry, Esq., at Young Conaway Stargatt & Taylor LLP. The Official Committee of Unsecured Creditors appointed in the case retained Morrison & Foerster LLP and Womble Carlyle Sandridge & Rice, LLP, as bankruptcy co-counsel. Peter J. Solomon Company serves as the Committee's financial advisor. PRECISION AIRMOTIVE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Precision Airmotive LLC 14800 40th Ave NE Marysville, WA 98271 Bankruptcy Case No.: 12-22154 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Karen A. Overstreet Debtor's Counsel: John S. Kaplan, Esq. PERKINS COIE LLP 1201 3rd Ave Ste 4800 Seattle, WA 98101-3099 Tel: (206) 583-8500 E-mail: jkaplan@perkinscoie.com Scheduled Assets: $5,925,435 Scheduled Liabilities: $2,166,946 A copy of the Company's list of its 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb12-22154.pdf The petition was signed by Scott L. Grafenauer, president. PROTECTIVE LIFE: Fitch Affirms 'BB+' Trust Preferred Ratings ------------------------------------------------------------ Fitch Ratings has affirmed Protective Life Corp.'s (NYSE: PL) Issuer Default Rating (IDR) at 'BBB+' and senior debt ratings at 'BBB'. Fitch has also affirmed PL's trust preferred ratings at 'BB+' and primary life insurance subsidiaries' Insurer Financial Strength (IFS) ratings at 'A'. The Rating Outlook is Stable. PL's ratings reflect the group's good operating performance, including strong investment results, solid debt service capability and sound risk-adjusted capitalization. The company's financial leverage ratio is in line with rating expectations, but overall leverage is high driven by reserve financing. Fitch views PL's operating results as good and in line with expectations for the rating. Full-year 2012 results are expected to be relatively flat with the prior year, as favorable factors, including good mortality and improved equity market performance, are offset by the impact of ongoing low interest rates, including lower lapses and a slowdown in top line growth. PL is deemphasizing growth in variable annuities going forward, although it plans to grow life sales through institutional channels. Fitch views PL's ability to service adjusted debt interest expense as solid based on GAAP earnings coverage in the 8x range. Cash interest coverage, which considers maximum statutory dividend capacity and committed cash at the holding company relative to adjusted interest expense, is also strong at about 6x. PL estimates the NAIC risk-based capital ratio of Protective Life Insurance Company, the group's primary operating company, at 462% as of Sept. 30, 2012, compared with 433% at year-end 2011. It is expected to increase further for the full year 2012 reflecting a fourth quarter captive reinsurance reserve financing transaction. PL indicates that, following the transaction, all XXX and AXXX reserve financing needs are now funded to the peak. New business written in the second half of 2012 and 2013 is not expected to require reserve financing. PL's financial leverage ratio (FLR) was 29% at the end of the third quarter compared to 28% at year-end 2011. New debt issued in 2012 was used to pay off existing debt, so the increase in the ratio was due mainly to the new DAC accounting rules, which resulted in a decrease in GAAP equity. The FLR is in line with rating expectations. Fitch notes, however, that the FLR excludes reserve funding arrangements, which are included in Fitch's total financings and commitments ratio (TFC). Fitch views PL's TFC as very high relative to peers at 1.8x as of Sept. 30, 2012. Fitch generally views PL's reserve financing activities as well managed. Key concerns include macroeconomic headwinds from low interest rates and high financial market volatility. These conditions are expected to constrain PL's ability to improve earnings over the near term and could have a material negative effect on the company's earnings and capital in a severe, albeit unexpected, scenario. The key rating triggers that could result in an upgrade include continued good GAAP operating profitability and earnings-based coverage of interest expense; financial leverage below 25%; TFC below 1.0x range. The key rating triggers that could result in a downgrade include material declines in GAAP equity that would drive financial leverage above 30%) or statutory capital (that would drive reported RBC below 300%), a downturn or weak growth in earnings, or a material reinsurance loss. Ratings could also be pressured if interest coverage fell below 5x. Fitch has affirmed the following ratings with a Stable Rating Outlook: Protective Life Corporation --IDR at 'BBB+'; --$250 million in senior notes due 2013 at 'BBB'; --$150 million in senior notes due 2014 at 'BBB'; --$150 million in senior notes due 2018 at 'BBB'; --$400 million of 7.38% senior notes due 2019 at 'BBB'; --$300 million of 8.45% senior notes due 2039 at 'BBB'; --$100 million of 8.00% senior retail notes due 2024 at 'BBB'; --$288 million of 6.25% subordinated debt due 2042' at 'BB+'; --$150 million of 6.00% subordinated debt due 2042 at 'BB+'; --$103 million of 6.13% trust preferreds issued through PLC Capital Trust V due 2034 at 'BB+'; Protective Life Insurance Company Protective Life and Annuity Insurance Company West Coast Life Insurance Company --IFS at 'A'. Protective Life Secured Trust --Notes at 'A'; --Medium-term notes at 'A'. QUIGLEY CO: Pfizer Hoping for Supreme Court Appeal on Protection ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that while Quigley Co. is waiting to learn whether a bankruptcy court will approve the reorganization plan ending its eight-year-old Chapter 11 case, parent Pfizer Inc. is hoping the U.S. Supreme Court will allow an appeal of an unfavorable ruling from the U.S. Court of Appeals in Manhattan. According to the report, Quigley filed its sixth-amended plan in late June, modified after the April opinion from the appeals court. Upholding a district court, the appeals court ruled that Pfizer wasn't entitled to complete protection from asbestos claims under the umbrella of Quigley's Chapter 11 case. In the latest iteration of the plan, Pfizer increased its contribution to creditors' recoveries. The report relates that Pfizer filed papers in September asking the Supreme Court to allow an appeal. At the court's request, the winners in the appeals court submitted papers last week. If the high court decides to hear the case, it may be argued soon enough so there will be a decision before the court's term ends in June. Meanwhile, back in bankruptcy court in Manhattan, Quigley creditors concluded voting on the plan at the end of November. The bankruptcy judge will conduct a status conference on Jan. 17, with a confirmation hearing for approval of the plan to occur later. Quigley is a non-operating Pfizer subsidiary. The plan, according to the report, will shed asbestos liability for both Quigley and Pfizer. In addition to increasing its cash contribution, Pfizer is waiving a $95 million secured claim, a $19 million claim for financing the Chapter 11 case, and a $33 million unsecured claim. Quigley suffered several defeats during the Chapter 11 case. The bankruptcy judge ruled that a prior reorganization plan was filed in bad faith and not feasible. Quigley filed a new plan to cure the defects, which was pending when the district judge ruled against Pfizer in May 2011. The Pfizer appeal in the Supreme Court is Pfizer Inc. v. Law Offices of Peter G. Angelos, 12-300, U.S. Supreme Court. The Chapter 11 case is In re Quigley Co. Inc., 04-15739, U.S. Bankruptcy Court, Southern District of New York (Manhattan). The appeal in the circuit court was Quigley Co. Inc. v. Law Offices of Peter G. Angelos (In re Quigley Co. Inc.), 11-2635, U.S. Court of Appeals for the Second Circuit (Manhattan). The appeal in district court was In re Quigley Co. Inc., 10-01573, U.S. District Court, Southern District of New York (Manhattan). About Quigley Co. Quigley Co. was acquired by Pfizer in 1968 and sold small amounts of products containing asbestos until the early 1970s. In September 2004, Pfizer and Quigley took steps that were intended to resolve all pending and future claims against the Company and Quigley in which the claimants allege personal injury from exposure to Quigley products containing asbestos, silica or mixed dust. Quigley filed for bankruptcy in 2004 and has a Chapter 11 plan and a settlement with Chrysler. Quigley filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 04-15739) on Sept. 3, 2004, to implement a proposed global resolution of all pending and future asbestos- related personal injury liabilities. Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represent the Debtor in its restructuring efforts. Elihu Inselbuchm Esq., at Caplin & Drysdale, Chartered, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it disclosed $155,187,000 in total assets and $141,933,000 in total debts. In April 2011, the bankruptcy judge approved a plan-support agreement with Pfizer and an ad hoc committee representing 30,000 asbestors claimants. A May 20, 2011 opinion by District Judge Richard Holwell concluded that Pfizer was directly liable for some asbestos claims arising from products sold by its now non-operating subsidiary Quigley. QUINTILES TRANSNATIONAL: S&P Affirms 'BB-' Corporate Credit Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating on Research Triangle Park, N.C.-based contract services provider Quintiles Transnational Corp. "We also affirmed our 'BB-' issue-level rating and '4' recovery rating (30% to 50% recovery expectation) on that entity's revolver and incremental term loan, and our 'B' issue-level rating and '6' recovery rating (0% to 10% recovery expectation) on the holding company's term loan," S&P said. "At the same time, we assigned Quintiles Transnational Corp.'s proposed $1,975 million term loan B-2 due 2018 our 'BB-' issue- level rating, with a recovery rating of '4', indicating our expectation for average (30% to 50%) recovery for lenders in the event of a payment default. The company will use proceeds from the loan to refinance its existing term loan B. The new loans reduce interest expense and provide for further pricing step downs if Quintiles completes an initial public offering. However, we have no information from the company to suggest that an offering is imminent," S&P said. "The ratings on Quintiles Transnational Corp. reflect the company's 'aggressive' financial policy, characterized by pro forma lease-adjusted debt to EBITDA slightly above 5x and a shareholder-friendly financial policy that has resulted in two debt-financed dividends this year," said Standard & Poor's credit analyst Shannan Murphy. The ratings also reflect Quintiles' "satisfactory" business risk profile, supported by the company's industry-leading market position in the growing contract research (CRO) industry. "Quintiles' aggressive financial risk profile reflects a financial policy that uses excess cash and debt capacity for dividends. Pro forma for the October 2012 debt issuance, debt to EBITDA as of Sept. 30, 2012, was 5x, reflecting in part the addition of $475 million of new debt in 2012 to fund shareholder distributions. Although we believe EBITDA growth will result in declining debt leverage over time, we believe Quintiles will use its growing excess debt capacity for additional dividends and, absent a change in capital structure or financial policy, will maintain leverage in the 4x to 5x range over the longer term," S&P said. RANCHO CALIFORNIA: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Rancho California Center, Rancho California Center dba North View Business Center 1656 Bahia Vist Way La Jolla, CA 92037 Bankruptcy Case No.: 12-16157 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court Southern District of California (San Diego) Judge: Louise DeCarl Adler Debtor's Counsel: Thomas B. Gorrill, Esq. LAW OFFICE OF THOMAS GORRILL 401 West A Street Suite 1770 San Diego, CA 92101 Tel: (619) 237-8889 E-mail: tgorrill@gorillalaw.com Scheduled Assets: $11,320,521 Scheduled Liabilities: $3,126,953 The Company did not file a list of creditors together with its petition. The petition was signed by Elliott Woolley, Northview Business Center, Inc., general partner. RENAISSANCE LEARNING: Moody's Corrects Oct. 19 Rating Release ------------------------------------------------------------- Moody's Investors Service issued a correction to the October 19, 2012 rating release of Renaissance Learning, Inc. Moody's affirmed Renaissance's B2 corporate family rating (CFR) and changed its probability of default (PDR) rating to B3 from B2. Moody's also assigned B2 ratings to Renaissance 's proposed amended/extended first lien senior secured credit agreement, consisting of a $20 million revolving credit facility due 2017 and a $230 million term loan due 2018. The ratings outlook remains stable. The company will use cash combined with proceeds from the amended term loan to refinance existing indebtedness, including the $75 million second lien term loan (unrated). Moody's views the transaction as credit positive as it materially reduces interest expense, extends debt maturities, and reduces leverage. Specifically, the pro forma debt balance declines to $230 million from $248 million as of September 30, 2012. However, there is no change to the company's ratings or outlook based on Moody's view that, despite the benefits of the transaction, pro forma credit metrics do not improve sufficiently to justify a higher rating. The change in the PDR to B3 from B2 reflects the fact that the proposed capital structure consists entirely of first lien debt (as per Moody's Loss Given Default Methodology). Rating affirmed: Corporate family rating at B2 Rating changed: Probability of default rating to B3 from B2 Ratings assigned: Proposed $20 million first lien senior secured revolving credit facility due 2017 at B2 (LGD3, 34%) Proposed $230 million term loan due 2018 at B2 (LGD3, 34%) Ratings to be withdrawn: $20 million first lien senior secured revolving credit facility due 2016 at B1 (LGD3, 34%) $173 million first lien senior secured term loan due 2017 at B1 (LGD3, 34%) Rating Rationale Renaissance's B2 corporate family rating reflects the company's small scale, high leverage with debt to EBITDA expected to slightly exceed 5.0 times (Moody's adjusted and pro forma for the pending refinancing), and balance sheet debt that is well in excess of revenues. The rating also considers the company's reliance on a single product - Accelerated Reader - for a large portion of its revenues, as well as competition from large scale well-capitalized companies and the company's susceptibility to school budget cuts. High leverage reduces Renaissance's financial flexibility and its ability to withstand changes to the competitive environment. Notwithstanding these risks, the rating derives support from Renaissance's business position as a provider of computer-based assessment technology in a fragmented market, a large-base of active school customers, a material proportion of recurring subscription-based revenues, and its ability to grow orders despite weak macroeconomic conditions and the associated pressures on school budgets. The rating also benefits from the company's good operating margins and expectations for positive free cash flow generation supported by modest capital expenditure requirements. The stable outlook reflects Moody's expectation that Renaissance will continue to grow new orders despite continued school budgetary pressures while applying free cash flow to debt reduction. The ratings could be pressured if the challenging operating environment causes order trends to weaken such that Renaissance's debt to EBITDA increases above 6.0 times and/or EBITDA less capex to interest falls below 2.0 times. Debt financed acquisitions and/or shareholder enhancement activities could also pressure the ratings. Moody's could upgrade Renaissance's ratings if it organically grows its scale and broadens its product mix while sustaining debt to EBITDA below 4.0 times, EBITDA less capex coverage of interest expense above 2.5 times, and free cash flow to debt in excess of 10%. The ratings are subject to the conclusion of the transactions, as proposed, and Moody's review of final documentation. The principal methodology used in rating Renaissance Learning, Inc. was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Renaissance Learning, Inc. is a provider of computer-based assessment technology and school improvement programs for pre- kindergarten through senior high (pre-K-12) schools and districts. The company revenues were approximately $140 million for the twelve months ended June 30, 2012 (adjusting for the write-off of deferred revenue). RESERVES RESORT: Case Summary & 12 Unsecured Creditors ------------------------------------------------------ Debtor: The Reserves Resort, Spa & Country Club LLC aka The Reserves Development Corporation Reserves Development Corporation 115 South Avolyn Avenue Ventnor, NJ 08406 Bankruptcy Case No.: 12-13316 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Judge: Kevin Gross Debtor's Counsel: Adam Hiller, Esq. HILLER & ARBAN, LLC 1500 North French Street, 2nd Floor Wilmington, DE 19801 Tel: (302) 442-7677 Fax: (302) 442-7045 E-mail: ahiller@hillerarban.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 12 unsecured creditors is available for free at http://bankrupt.com/misc/deb12-13316.pdf The petition was signed by Abraham Korotki, manager/member. RESIDENTIAL CAPITAL: Proposes Mediator for Plan Negotiations ------------------------------------------------------------ Residential Capital, LLC, and its debtor affiliates ask Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York to appoint a sitting bankruptcy judge as mediator to oversee their plan negotiation process. Gary S. Lee, Esq., at Morrison & Foerster LLP, in New York, relates that although the stage has been set for productive plan negotiations, including the provision to various parties-in- interest with equal access to information, the Debtors have experienced a desire on the part of various constituents to focus solely on the amount and allocation of the proceeds of any proposed settlement with Ally Financial Inc. and a reluctance on the part of certain constituents to discuss issues in advance of finalization of the Chapter 11 Examiner's report. One creditor group indicated it believes engaging in the plan process before the Examiner's investigation concludes is "objectively futile," to which the Debtors disagree, Mr. Lee tells the Court. While the settlement with Ally Financial Inc. has significant implications in the Chapter 11 cases, the pendency of the Examiner's investigation need not impede material progress on discussions regarding alternative settlements with AFI and other aspects of a plan of reorganization, Mr. Lee asserts. While the Debtors plan to encourage and continue negotiation over the coming weeks, the Debtors ask that the Court appoint a mediator now to allow the mediator sufficient time to educate him or herself on the numerous complex issues, that are paramount to achieving a consensual, confirmable Chapter 11 plan so that the mediator can step in at the parties' request, as appropriate, without delay. Due to the size and complexity of these cases, the Debtors maintain that the appointment of a sitting bankruptcy court judge is appropriate for this role. The Debtors believe that a mediator could provide assistance in fostering discussion concerning AFI-related issues and intercreditor/interdebtor issues: (a) AFI Related Issues -- The Debtors believe a mediator could foster discussion among AFI, the Debtors, and the Debtors' creditors on the strengths and weaknesses of estate and third party claims against AFI. A discussion of these claims, assisted by a neutral third party mediator, would facilitate a consensus view on how best to settle, if possible, claims against AFI, and how to allocate the proceeds of the AFI Settlement, or any alternative settlement, as part of a consensual plan negotiated in anticipation of, and prior to the issuance of, the Examiner's Report. (b) Intercreditor and Interdebtor Issues -- To the extent they cannot be resolved in connection with plan discussions, a mediator may also be able to provide constructive and independent guidance on the complex intercreditor and interdebtor issues that will effect plan distributions, including, but not limited to, those related to (i) the allocation of proceeds from the sale of the Debtors' assets, (ii) the validity of certain security interests, and entitlement, if any, to postpetition interest and fees, (iii) the allocation of administrative claims among the Debtor entities, (iv) the extent, validity, and priority of various creditors' claims, and (v) the treatment of intercompany claims under a plan. The Debtors specify that establishing a finite period of time in which mediation will occur will motivate the parties to tackle the issues head on, without further delay. Recognizing the complexity of the issues, however, the Debtors, after consultation with the relevant parties and the mediator, may seek to extend that time period, Mr. Lee says. The Debtors, according to Mr. Lee, have discussed this approach with a number of parties, including, among others, the Official Committee of Unsecured Creditors; Wilmington Trust, N.A, the co- chair of the Creditors' Committee and the indenture trustee for the Debtors' senior unsecured noteholders, AFI, certain monoline insurers, and the residential mortgage-backed securities investors and the RMBS Trustees. These parties recognize that the appointment of a mediator is appropriate, Mr. Lee tells the Court. The Court will convene a hearing on Dec. 20 to consider approval of the request. About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RESIDENTIAL CAPITAL: Wants Until Feb. 28 to File Plan ----------------------------------------------------- Residential Capital LLC and its affiliates ask Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York to further extend their exclusive period to file a Chapter 11 plan through and including February 28, 2013, and their exclusive period to solicit acceptances of that plan through and including April 29, 2013. The Debtors relate that since the Sept. 11 hearing on their first exclusive period extension request, they have participated in additional meetings with advisors to the Official Committee of Unsecured Creditors, Ally Financial, Inc., the holders of the Debtors' junior secured bonds, the holders of senior unsecured notes, monoline insurers and the residential mortgage-backed securities investors all in an effort to forge consensus among parties in interest. The Debtors have provided key stakeholders an array of business and financial information in an effort to facilitate productive discussions. The Debtors and their advisors provided key stakeholders with "waterfall" analyses which help set forth hypothetical returns to creditors. These types of analyses require considerable investment of time and attention by the Debtors and their advisors, according to Gary S. Lee, Esq., at Morrison & Foerster LLP, in New York. In order to produce a waterfall, the Debtors and their advisors are required to review and analyze the latest balance sheet for each of the 51 Debtors to assess the current value of the Debtors' assets and liabilities. Additionally, the Debtors' assets and liabilities must to be broken down by collateral group and consideration taken of lien positions and co-borrower and guarantee relationships. In producing a waterfall, the Debtors' advisors are also required to analyze and forecast the trajectory of the Chapter 11 cases following the closing of the Asset Sales, including estimating wind-down costs and timing. Mr. Lee tells the Court that the Debtors and their advisors have devoted the time and effort to producing these waterfalls because they recognize their importance for meaningful plan discussions. At each of these plan meetings, the Debtors and the meeting participants identified broad categories of issues that need to be resolved either prior to or as part of a Chapter 11 plan. Among the topics that were discussed and that need to be resolved as part of a successful, consensual plan process, are the following: (a) Intercreditor Issues -- including the extent and validity of the liens securing the Debtors' secured debt facilities and the treatment of intercompany claims under a plan. (b) The AFI Settlement -- including the proposed third party releases that may be incorporated into the plan and the allocation of the proceeds of any settlement among the Debtor entities and their creditors. (c) Sales Process -- including the allocation of the proceeds among the Debtors' assets, and GSE approval. (d) Treatment of Various Claims Under the Plan -- including strategy of dealing with various cure claims. (e) Examiner Issues -- including possible plan-related scenarios leading up to and following the issuance of the Examiner's Report and the timing thereof. (f) The DOJ/AG Settlement and Consent Order -- including the Debtors' requirements thereunder and strategy for discussions with the Federal Reserve Board regarding the Foreclosure Review services to be performed by PriceWaterhouseCoopers, LLP. (g) Post-Confirmation Issues -- including the structure and cost of the winddown and the timing to conduct the sale of the Debtors' remaining assets. In addition, the Debtors sought the appointment of a mediator to assist the plan negotiation process and ensure that those with a seat at the table are in the best position for disciplined, good faith discussions that are focused on the appropriate issues, Mr. Lee relates. The Debtors, he adds, are optimistic that a plan mediator will aid in the negotiation of a consensual plan despite the divergent interests of the major stakeholders. Mr. Lee tells the Court that the Debtors and their advisors recognize that there is still much work to be done to file and seek confirmation of a Chapter 11 plan. The Creditors' Committee has also advised the Debtors that it supports the proposed further extension of the Exclusive Periods. The Debtors believe that the time will be well spent working cooperatively with their key party constituents negotiating a consensual Chapter 11 plan. The current Exclusive Plan Period expires on December 20, 2012, and the Exclusive Solicitation Period expires on February 18, 2013. "Allowing the Exclusive Plan Period to terminate at this time would almost certainly set back the plan process," Mr. Lee asserts. "Thus, in order to achieve the best result, the Debtors need additional time to negotiate, document and file a Chapter 11 plan." About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RESIDENTIAL CAPITAL: Wants Removal Period Extended Until April 9 ---------------------------------------------------------------- Residential Capital LLC and its affiliates ask the Bankruptcy Court to further extend the period within which they may file notices of removal of civil actions to the later of (a) April 9, 2013, or (b) should the Court enter an order terminating the automatic stay as to a particular civil action, for that civil action, 30 days after the entry of the order terminating the automatic stay. The Debtors relate that they are still continuing to review their files and records and analyze relevant court documents to determine whether their estates would benefit from the removal of any of the Civil Actions. The Debtors assert that further extending their period to file notices of removal will provide them with adequate time to conduct the review and to evaluate the pending litigation matters within the larger context of their chapter 11 cases. The Debtors believe that the proposed extension will enable them to properly consider, and make informed decisions concerning, the removal of the Civil Actions, although they reserve the right to request additional extensions should they become necessary. About Residential Capital Residential Capital LLC, the unprofitable mortgage subsidiary of Ally Financial Inc., filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012. Neither Ally Financial nor Ally Bank is included in the bankruptcy filings. ResCap, one of the country's largest mortgage originators and servicers, was sent to Chapter 11 with 50 subsidiaries amid "continuing industry challenges, rising litigation costs and claims, and regulatory uncertainty," according to a company statement. ResCap disclosed $15.68 billion in assets and $15.28 billion in liabilities as of March 31, 2012. Centerview Partners LLC and FTI Consulting are acting as financial advisers to ResCap. Morrison & Foerster LLP is acting as legal adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is the conflicts counsel. Rubenstein Associates, Inc., is the public relations consultants to the Company in the Chapter 11 case. Morrison Cohen LLP is advising ResCap's independent directors. Kurtzman Carson Consultants LLP is the claims and notice agent. Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves as counsel to Ally Financial. The Bankruptcy Court in November 2012 approved ResCap's sale of its mortgage servicing and origination platform assets to Ocwen Loan Servicing, LLC and Walter Investment Management Corporation for $3 billion; and its portfolio of roughly 50,000 whole loans to Berkshire Hathaway for $1.5 billion. The sale of the assets, subject to satisfaction of customary closing conditions including certain third party consents, is expected to close in the first quarter of 2013. The partnership of Ocwen and Walter defeated the last bid of $2.91 billion from Fortress Investment Group's Nationstar Mortgage Holdings Inc., which acted as stalking horse bidder, at an auction that began Oct. 23, 2012. The $1.5 billion offer from Warren Buffett's Berkshire Hathaway Inc. was declared the winning bid for a portfolio of loans at the auction on Oct. 25. Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by affiliates of Residential Capital LLC and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000). RG STEEL: Hackman Capital Confirms Purchase of Former Plant ----------------------------------------------------------- Hackman Capital Partners, LLC, confirmed last week the purchase of the former Wheeling Corrugating plant in Beech Bottom, West Virginia from RG Steel, Wheeling, LLC. The firm is working in conjunction with The Business Development Corporation ("BDC") of the Northern Panhandle, a non-profit, who took title to the real estate following the auction of the real property and equipment. Hackman Capital will be working the BDC to develop and lease the site. Beech Bottom was one of the last steel manufacturing facilities of RG Steel who filed for Chapter 11 bankruptcy this year. Hackman Capital, a Los Angeles-based private equity real estate investment firm, was the winning bidder at the auction for the onsite equipment. The firm, which specializes in these types of complex transactions, sources many real estate and equipment deals through bankruptcies, turnarounds, and financial restructurings and has deep experience redeveloping sites of this nature. "We are excited to collaborate with the BDC to rejuvenate this site for better economic use," said Michael Hackman, Chief Executive Officer and Founder of Hackman Capital. Mr. Hackman confirmed that their plan is to sell the equipment. Hackman Capital sourced the deal together with National Machinery Exchange and Capital Recovery Group and is working in cooperation with the BDC who has deep knowledge of the area. The massive site includes 600 total acres of land -- 150 of which can be used for development -- and sits in a prime location along the Ohio River. In recent years, this area has seen an energy boom throughout the region, which makes this a rare development opportunity. "This area of West Virginia has exploded economically in recent months due to new ways to drill for natural gas, so we believe we have an excellent opportunity to attract companies to the site," said Mr. Hackman, "We are hopeful this will bring many new jobs to the area." About Hackman Capital Founded in 1986 and headquartered in Los Angeles, Hackman Capital -- http://www.hackmancapital.com-- is a privately held, asset- based investment firm that focuses on the acquisition of industrial real estate and the purchase and sale of industrial equipment. The firm currently owns, through its affiliated entities, 100 facilities throughout the United States, totaling approximately 18 million square feet and more than 1,300 acres of developable land. Hackman Capital also has conducted hundreds of equipment acquisitions, dispositions, and liquidations on four continents. The company is based in Los Angeles. About RG Steel RG Steel LLC -- http://www.rg-steel.com/-- is the United States' fourth-largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. It was formed in March 2011 following the purchase of three steel facilities located in Sparrows Point, Maryland; Wheeling, West Virginia and Warren, Ohio, from entities related to Severstal US Holdings LLC. RG Steel also owns finishing facilities in Yorkville and Martins Ferry, Ohio. It also owns Wheeling Corrugating Company and has a 50% ownership in Mountain State Carbon and Ohio Coatings Company. RG Steel along with affiliates, including WP Steel Venture LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12- 11661) on May 31, 2012, to pursue a sale of the business. The bankruptcy was precipitated by liquidity shortfall and a dispute with Mountain State Carbon, LLC, and a Severstal affiliate, that restricted the shipment of coke used in the steel production process. The Debtors estimated assets and debts in excess of $1 billion as of the Chapter 11 filing. The Debtors owe (i) $440 million, including $16.9 million in outstanding letters of credit, to senior lenders led by Wells Fargo Capital Finance, LLC, as administrative agent, (ii) $218.7 million to junior lenders, led by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million on account of a subordinated promissory note issued by majority owner The Renco Group, Inc., and (iv) $100 million on a secured promissory note issued by Severstal. Judge Kevin J. Carey presides over the case. The Debtors are represented in the case by Robert J. Dehney, Esq., and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP, and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T. Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial advisor and The Seaport Group serves as lead investment banker. Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson Consultants LLC is the claims and notice agent. Wells Fargo Capital Finance LLC, as Administrative Agent, is represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang Ziehi & Jones LLP. Renco Group is represented by lawyers at Cadwalader, Wickersham & Taft LLP. An official committee of unsecured creditors has been appointed in the case. Kramer Levin Naftalis & Frankel LLP represents the Committee. Huron Consulting Services LLC serves as its financial advisor. The Debtor has sold off the principal plants. The sale of the Wheeling Corrugating division to Nucor Corp. brought in $7 million. That plant in Sparrows Point, Maryland, fetched the highest price, $72.5 million. RIDGE PARK OFFICE: Chapter 11 Case Dismissed -------------------------------------------- The Chapter 11 case of Ridge Park Office, LLC, has been dismissed as the Debtor ultimately failed to stop foreclosure attempts by its lender. Temecula, California-based Ridge Park sought bankruptcy protection (Bankr. C.D. Calif. Case No. 11-33683) on July 22, 2011. The Debtor filed its chapter 11 case on an emergency basis to avoid a foreclosure sale of its real property by CSMC 2006-C5 Better World Limited Partnership, the holder of a first position deed of trust against the Debtor's sole asset known as Garrett Corporate Center. After the case was filed, CSMC sought and obtained relief from the automatic stay. CSMC is a holder of a promissory note issued by the Debtor. CSMC auctioned its interest in the note and a winning bidder emerged. The winning bidder has interested into a new agreement with the Debtor. With the closing of the sale of the note, either sole owner Redhawk Communities, Inc. or the Debtor would pay all general unsecured claims in full, any outstanding U.S. Trustee fees, and administrative claims in full. Accordingly, Ridge Park sought dismissal of the case. The order was entered June 18. The order also authorized the Debtor to immediately pay prepetition claims (comprised solely of a $808.15 priority claim and $6,705.90 of general unsecured claims), the quarterly fees of the Office of the United States Trustee, and the outstanding attorneys' fees and expenses of Levene, Neale, Bender, Yoo & Brill L.L.P., bankruptcy counsel to the Debtor. Ridge Park affiliates that have separately filed Chapter 11 petitions are: RCI Regional Grove, LLC (Case No. 11-22055) filed on April 12, 2011; Diaz Road Properties, LLC (Case No. 11-28473) and RCI Rio Nedo, LLC (Case No. 11-28470) both filed on June 6, 2011; and Woods Canyon Associates L.P. (Case No. 11-32418) filed on July 11, 2011. The Ridge Park case was originally assigned to Judge Catherine E. Bauer but was later moved to Judge Scott C. Clarkson, who oversees the affiliates' cases. Prepetition lender CSMC 2006-C5 Better World Limited Partnership is represented by H. Mark Mersel, Esq., at Bryan Cave LLP. The Debtor disclosed liabilities of $11,254,887. RIDGE VIEW FARM: Lenders Win Dismissal of Chapter 11 Case --------------------------------------------------------- Northern District of New York Bankruptcy Judge Margaret Cangilos- Ruiz dismissed the Chapter 11 case of Ridge View Farm LLC, at the behest of secured creditors Pleasant Acre Farms, LLC, and Germaine Bourdeau. The Secured Creditors said the case should be dismissed for lack of good faith. The Court also granted a motion by Pleasant Acre in the reopened chapter 12 case of Ridge View Farm. Pleasant Acre seeks to modify the terms of an order granting relief from stay dated June 23, 2011. The Court granted in rem relief as to the Debtor's farm land property for a period of one year or such time as may be necessary for Pleasant Acre to conclude a foreclosure sale, whichever period is sooner. Should the Farm be deemed property of the estate in any new bankruptcy case, whether the subject of a voluntary or involuntary filing during the interim, the automatic stay will not apply to the Farm nor to Pleasant Acre and or their assigns who may proceed with a foreclosure sale of the Farm without obtaining further relief from the automatic stay. Pleasant Acre is the assignee of a $400,000 secured claim by Chase American Mortgage Company, LLC. Ridge View Farm, LLC, owns roughly 2,800 acres of farm land located in the towns of Hounsfield, Rutland, and Watertown, New York. It claims the Farm holds "valuable mineral rights" and is improved by several buildings "suitable for living [which] are rented out when a demand exists." The Farm was leased out to neighboring farmers at the time the Debtor filed for bankruptcy. Ridge View Farm LLC, on March 25, 2009, filed a chapter 12 bankruptcy petition (Bankr. N.D.N.Y. Case No. 09-30498) -- the first of three bankruptcy filings it would initiate -- to avoid a tax sale of the Farm. In its schedules, the the Debtor valued the Farm at $1,934,469. The case was ultimately dismissed on Feb. 8, 2010, because the Debtor failed to comply with the terms of a conditional order, namely, the requirement that it notice a hearing on confirmation of a chapter 12 plan. Ridge View Farm filed its second chapter 12 case (Bankr. N.D.N.Y. Case No. 11-30463) on March 10, 2011, on the eve of a scheduled foreclosure sale of the Farm. Shortly thereafter, the creditor, Chase American Mortgage Company, LLC, obtained relief from the automatic stay. The Stay Order also granted Chase in rem relief for a period of one year. Without opposition from the Debtor, Ridge View II was dismissed on Aug. 24, 2011 for the Debtor's failure to file a chapter 12 plan. On July 6, 2012, Ridge View Farm filed for Chapter 11 bankruptcy (Bankr. D. Conn. Case No. 12-31700) in New Haven. Bankruptcy Judge Lorraine Murphy Weil was assigned to the case. Peter L. Ressler, Esq., at Groob Ressler & Mulqueen, P.C., serves as Chapter 11 counsel. In the Chapter 11 petition, Ridge View estimated under $50,000 in assets and between $1 million and $10 million in debts. A copy of the Company's list of its three largest unsecured creditors filed with the petition is available for free at http://bankrupt.com/misc/ctb12-31617.pdf Ridge View III was filed 13 days after the expiration of the one- year period during which in rem relief as to the Farm had been granted by the Stay Order. The scheduled only one asset, the Farm, which it values at $7 million. By order entered Aug. 15, 2012, the N.D.N.Y. Bankruptcy Court reopened Ridge View II. The Connecticut court, by order entered Aug. 27, changed the venue and transferred Ridge View III, along with a related adversary proceeding, to the N.D.N.Y court. To date, the Debtor has not filed a chapter 11 plan of reorganization. A copy of the Court's Dec. 10, 2012 Memorandum-Decision and Order is available at http://is.gd/iuNcmlfrom Leagle.com. RIDGELAND APARTMENT: Case Summary & 2 Unsecured Creditors --------------------------------------------------------- Debtor: Ridgeland Apartment Holdings, LLC 224 S. 200 W., Suite 110 Salt Lake City, UT 84101 Bankruptcy Case No.: 12-35417 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court District of Utah (Salt Lake City) Judge: Joel T. Marker Debtor's Counsel: Knute A. Rife, Esq. RIFE LAW OFFICE P.O. Box 2941 Salt Lake City, UT 84110 Tel: (801) 809-9986 E-mail: KARife@RifeLegal.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its two largest unsecured creditors is available for free at: http://bankrupt.com/misc/utb12-35417.pdf The petition was signed by Shane Baldwin, principal of member/manager. SAN BERNARDINO, CA: Calpers Win Would Rewrite Chapter 9 Rules ------------------------------------------------------------- Bloomberg News' Steven Church and James Nash report that the California Public Employees' Retirement System is trying to rewrite the rules for bankrupt cities, claiming that it should get paid before almost everyone else, including bondholders. Bloomberg relates James E. Spiotto, Esq., said in an interview Calpers is arguing that all of its debt should be treated as an administrative claim, which means only a handful of creditors would be paid first, such as the lawyers and financial advisers working on the bankruptcy case. Mr. Spiotto said a Calpers victory would threaten public services in a city trying to reorganize in bankruptcy, or in an extreme case, cause a city to disincorporate "Chapter 9 was never intended to cause the liquidation of a municipality or the reduction of services," said Mr. Spiotto, who isn't involved in the San Bernardino and Stockton cases, according to Bloomberg. "What Calpers is doing is threatening the basic tenet of Chapter 9." "What Calpers is trying to do is rewrite the priorities of the bankruptcy code," Kenneth N. Klee, who helped revise Chapter 9 of the U.S. Bankruptcy Code in the 1970s as a lawyer working for Congress, said in an interview, according to Bloomberg. He isn't involved in the California cases. San Bernardino has an unfunded pension liability of about $143 million and is in default on $50.4 million in bonds issued in 2005 to help cover pension obligations, according to court documents and the city budget. San Bernardino has said it must put off $13 million in payments to Calpers or risk public safety. Bloomberg relates San Bernardino will battle Calpers in a federal court in Riverside, California, on Dec. 21 over two related legal issues: whether Calpers can sue the city to force it to make about $7 million in missed payments and whether the city should be kicked out of bankruptcy. The report says Calpers has asked the bankruptcy judge to waive a restriction preventing the fund from suing the city in state court, where it would have the chance to force payment. "The city's failure to make these contributions is a violation of state law," Calpers said in court papers, according to the report. Bloomberg notes that in the Stockton case, Calpers General Council Peter Mixon issued a statement arguing that pensions and other public employee benefits are protected by the California Constitution and have priority over other creditors. Stockton has an unfunded pension liability of $147.5 million owed to Calpers, according to the city's bankruptcy petition. The city also owes $124.3 million on pension obligation bonds and about $142 million for various public projects. Creditors of Stockton are fighting Calpers in court, arguing that the pension fund shouldn't be given preferential treatment and urging the city to take an aggressive stance in negotiations. Bloomberg also relates Richard P. Larkin, director of credit analysis for Herbert J. Sims & Co., a municipal-bond underwriter in Iselin, New Jersey, said municipal bond investors are watching San Bernardino's fight with Calpers, partly because so much of the city's debt is tied to pensions. "If Calpers wins, I think people are going to look at bankruptcies for municipalities much more negatively," Mr. Larkin said by telephone, according to the report. "This is a precedent-setting case, not just in California but nationally." According to Bloomberg, Richard A. Ciccarone of McDonnell Investment Management LLC said in an interview that, should Calpers win, investors who buy municipal bonds will eventually demand higher interest rates from cities and counties to compensate for the increased risk. "It would put more bondholders at risk than would normally be at risk," said Mr. Ciccarone, chief research officer at Oak Brook, Illinois-based McDonnell, which oversees about $8 billion in municipal debt. SIGNATURE STATION: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Signature Station filed with the Bankruptcy Court for the Northern District of Georgia its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property Apartment Complex at 100 Leslie Oaks Dr., Lithonia, Georgia $18,800,000 B. Personal Property $1,943,000 C. Property Claimed as Exempt D. Creditors Holding Secured Claims Regions Bank $14,405,000 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $15,265 ----------- ----------- TOTAL $20,743,936 $14,420,265 The Debtor estimated $10 million to $50 million in total assets and liabilities in the Chapter 11 petition. Signature Station filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 12-75646) in Atlanta on Oct. 11, 2012. The Debtor is a Single Asset Real Estate as defined in 11 U.S. Sec. 101(51B). The Debtor said that as of March 6, 2012, its property was appraised for $18.8 million. Bankruptcy Judge Margaret Murphy presides over the case. Howick, Westfall, McBryan & Kaplan, LLP, serves as counsel. SILICON VALLEY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Silicon Valley Innovation Company, LLC aka Silicon Valley Innovation Capital, LLC SVIC Silicon Valley Internet Capital, LLC fka Silicon Valley Internet Capital, Inc. c/o National Registered Agents, Inc. 160 Greentree Drive, Suite 101 Dover, DE 19904 Bankruptcy Case No.: 12-13318 Chapter 11 Petition Date: December 10, 2012 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Debtor's Counsel: Brian L. Arban, Esq. HILLER & ARBAN, LLC 1500 North French Street Wilmington, DE 19801 Tel: (302) 442-7677 Fax: (302) 442-7046 E-mail: barban@hillerarban.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company's list of its 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/deb12-13318.pdf The petition was signed by Riverson Leonard, officer. SLD PROPERTIES: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: SLD Properties, LLC 1203 NE 78th Street Vancouver, WA 98665 Bankruptcy Case No.: 12-48259 Chapter 11 Petition Date: Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Paul B. Snyder Debtor's Counsel: John D. Nellor, Esq. NELLOR LAW OFFICE Park Tower One 201 N.E. Park Plaza Drive, Ste 202 Vancouver, WA 98684 Tel: (360) 816-2241 E-mail: jd@nellorlaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its 12 unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/wawb12-48259.pdf The petition was signed by Scott Dickinson, member manager. SPECTRUM BRANDS: S&P Affirms 'B' Corp. Credit Rating; Outlook Pos ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Madison, Wis.-based Spectrum Brands Inc. The outlook remains positive. "At the same time, we assigned our 'B' issue-level rating to the company's proposed $800 million term loan B due 2019. The recovery rating is '3', which indicates our expectation for meaningful recovery (50% to 70%) for secured term loan lenders in the event of a payment default or bankruptcy. We also assigned our 'B-' issue-level rating to the company's proposed $1.04 billion senior unsecured notes due 2020. The recovery rating is '5', which indicates our expectation for modest recovery (10% to 30%) for unsecured noteholders in the event of a payment default or bankruptcy," S&P said. "Our issue-level rating on the company's existing 9.5% $950 million senior secured notes due 2018 is 'B', with a recovery rating of '3'. Our issue-level rating on the company's existing 6.75% $300 million senior unsecured notes is 'B-'. The recovery rating is '5', which indicates our expectation for modest recovery (10% to 30%) for unsecured noteholders in the event of a payment default or bankruptcy. The ratings are based on the proposed terms and are subject to review upon receipt of final documentation," S&P said. "We will withdraw our 'B' issue-level rating and '3' recovery rating on the company's existing term loan once it is repaid with the proceeds from the proposed financing. We estimate the company will have about $3.1 billion in reported debt outstanding following the transaction," S&P said. "We believe Spectrum Brands benefits from the proposed acquisition of HHI," said Standard & Poor's credit analyst Brian Milligan. "HHI is a provider of residential locksets, builders' hardware, and faucets. The acquisition will increase the company's scale and increase both product and customer diversification. We expect credit metrics will strengthen over the next 12 months through a combination of higher EBITDA and debt reduction," S&P said. STOCKTON, CA: Calpers Win Would Rewrite Chapter 9 Rules ------------------------------------------------------- Bloomberg News' Steven Church and James Nash report that the California Public Employees' Retirement System is trying to rewrite the rules for bankrupt cities, claiming that it should get paid before almost everyone else, including bondholders. Bloomberg relates James E. Spiotto, Esq., said in an interview Calpers is arguing that all of its debt should be treated as an administrative claim, which means only a handful of creditors would be paid first, such as the lawyers and financial advisers working on the bankruptcy case. Mr. Spiotto said a Calpers victory would threaten public services in a city trying to reorganize in bankruptcy, or in an extreme case, cause a city to disincorporate "Chapter 9 was never intended to cause the liquidation of a municipality or the reduction of services," said Mr. Spiotto, who isn't involved in the San Bernardino and Stockton cases, according to Bloomberg. "What Calpers is doing is threatening the basic tenet of Chapter 9." "What Calpers is trying to do is rewrite the priorities of the bankruptcy code," Kenneth N. Klee, who helped revise Chapter 9 of the U.S. Bankruptcy Code in the 1970s as a lawyer working for Congress, said in an interview, according to Bloomberg. He isn't involved in the California cases. San Bernardino has an unfunded pension liability of about $143 million and is in default on $50.4 million in bonds issued in 2005 to help cover pension obligations, according to court documents and the city budget. San Bernardino has said it must put off $13 million in payments to Calpers or risk public safety. Bloomberg relates San Bernardino will battle Calpers in a federal court in Riverside, California, on Dec. 21 over two related legal issues: whether Calpers can sue the city to force it to make about $7 million in missed payments and whether the city should be kicked out of bankruptcy. The report says Calpers has asked the bankruptcy judge to waive a restriction preventing the fund from suing the city in state court, where it would have the chance to force payment. "The city's failure to make these contributions is a violation of state law," Calpers said in court papers, according to the report. Bloomberg notes that in the Stockton case, Calpers General Council Peter Mixon issued a statement arguing that pensions and other public employee benefits are protected by the California Constitution and have priority over other creditors. Stockton has an unfunded pension liability of $147.5 million owed to Calpers, according to the city's bankruptcy petition. The city also owes $124.3 million on pension obligation bonds and about $142 million for various public projects. Creditors of Stockton are fighting Calpers in court, arguing that the pension fund shouldn't be given preferential treatment and urging the city to take an aggressive stance in negotiations. Bloomberg also relates Richard P. Larkin, director of credit analysis for Herbert J. Sims & Co., a municipal-bond underwriter in Iselin, New Jersey, said municipal bond investors are watching San Bernardino's fight with Calpers, partly because so much of the city's debt is tied to pensions. "If Calpers wins, I think people are going to look at bankruptcies for municipalities much more negatively," Mr. Larkin said by telephone, according to the report. "This is a precedent-setting case, not just in California but nationally." According to Bloomberg, Richard A. Ciccarone of McDonnell Investment Management LLC said in an interview that, should Calpers win, investors who buy municipal bonds will eventually demand higher interest rates from cities and counties to compensate for the increased risk. "It would put more bondholders at risk than would normally be at risk," said Mr. Ciccarone, chief research officer at Oak Brook, Illinois-based McDonnell, which oversees about $8 billion in municipal debt. TAYLOR BEAN: D.C. Court Permits BofA to Proceed Against FDIC ------------------------------------------------------------ Tom Schoenberg, writing for Bloomberg News, reports that U.S. District Judge Barbara Rothstein, in a 73-page opinion issued in Washington, D.C., permitted Bank of America Corp. to proceed with some claims against the Federal Deposit Insurance Corp. over $1.75 billion in corporate client losses stemming from a mortgage-fraud scheme at failed lender Taylor, Bean & Whitaker Mortgage Corp. The judge said the bank's fraud claim against the FDIC is among those that will proceed to discovery. The judge also allowed some FDIC counterclaims against Bank of America to move forward. The case is Bank of America v. FDIC, 10-cv-01681, U.S. District Court, District of Columbia (Washington). About Taylor Bean Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala- based mortgage broker to become one of the largest mortgage bankers in the United States. In 2009, Taylor Bean was the country's third largest direct-endorsement lender of FHA-insured loans of the largest wholesale mortgage lenders and issuer of mortgage backed securities. It also managed a combined mortgage servicing portfolio of approximately $80 billion. The company employed more that 2,000 people in offices located throughout the United States. Taylor Bean sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 09-07047) on Aug. 24, 2009. Taylor Bean filed the Chapter 11 petition three weeks after federal investigators searched its offices. The day following the search, the Federal Housing Administration, Ginnie Mae and Freddie Mac prohibited the company from issuing new mortgages and terminated servicing rights. Taylor Bean estimated more than $1 billion in both assets and liabilities in its bankruptcy petition Lee Farkas, the former chairman, was sentenced in June to 30 years in federal prison after being convicted on 14 counts of conspiracy and bank, wire and securities fraud in what prosecutors said was a $3 billion scheme involving fake mortgage assets. Jeffrey W. Kelly, Esq., and J. David Dantzler, Jr., Esq., at Troutman Sanders LLP, in Atlanta, Ga., and Russel M. Blain, Esq., and Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain & Prosser, PA, in Tampa, Fla., represent the Debtors. Paul Steven Singerman, Esq., and Arthur J. Spector, Esq., at Berger Singerman PA, in Miami, Fla., represent the Committee. BMC Group, Inc., serves as the claims and noticing agent. Unsecured creditors were expected to receive 3.3% to 4.4% under a Chapter 11 plan approved in July 2011. TC GLOBAL: Baristas to Compete at Jan. 3 Auction ------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Tully's Coffee Shops may benefit from competitive bidding at the court-authorized auction on Jan. 3. Tully's signed Jonah Retail Holdings LLC, an affiliate of Kachi Partners, to a $4.3 million contract for the 47 continuing locations. The Kachi's offer includes $1.25 million cash and the assumption of liability for $1 million in gift cards and $1.63 million to cure defaults on contracts. Competitor Baristas Coffee Co. has announced that it intends to compete at the auction. Baristas said it formed a new company for the acquisition. Participants in the offer include some of Tully's existing shareholders and other investors, according to a statement. Under procedures approved by the bankruptcy judge Dec. 10, the auction is set for Jan. 3. Bids are due Dec. 27. A hearing on the results of the auction is scheduled for Jan. 11. Lisa Jennings, writing for Nation's Restaurant News, reports that Baristas Coffee Company said Tuesday it is making a $10.4 million bid for the assets of TC Global Inc. The report notes Baristas is a Seattle-based operator of a chain of drive-thru "sexpresso" stands manned by attractive female baristas. Nation's Restaurant News also reports that Tully's founder Tom "Tully" O'Keefe, said he has been contacted by other potential buyers that have also expressed interest. Mr. O'Keefe said he is also working on a bid, though he noted that other bidders have also contacted him with the hope of getting him involved. TC Global last month announced an asset purchase agreement with finance group Kachi Partners, which became the stalking-horse bidder in the auction. Under the deal, TC Global's assets would be acquired by Jonah Retail Holdings LLC, an entity backed by Boulder, Colo.-based finance group Kachi Partners, for $4.3 million, including $1.25 million in cash. The deal includes a $200,000 "break up" fee if a higher bidder emerges. The Nation's Restaurant News report notes the Kachi Partners agreement and the bankruptcy do not impact the wholesale and online Tully's Coffee business, which was purchased by Green Mountain Coffee Roasters Inc. in 2009. Complicating the auction, however, is a non-compete agreement with Green Mountain that could hinder a potential buyer that has a significant interest in a competing coffee brand, like Baristas, according to Nation's Restaurant News. Nation's Restaurant News relates Barry Henthorn, chief executive of Baristas, said he's not concerned about the non-compete agreement because the bid for Tully's assets is being made by a separate entity called Baristas Acquisition Partners Inc., which is backed by existing Tully's and Baristas shareholders, other executives from the coffee industry, financial analysts, investment bankers, professional athletes and other investors. The report also notes that in earlier court filings, the offer by Baristas Acquisition Partners was described as totaling $10.4 million in cash with assumed liabilities. Part of the offer would include $4.1 million in negotiable securities for secured and unsecured creditors, and $3.5 million in negotiable securities for TC Global shareholders. Except for a period between May and June 2011, Baristas' stock mostly traded below 10 cents a share. As a result of the announcement about taking a run at Tully's, the stock more than doubled to close at 2.8 cents in over-the-counter trading. About TC Global Headquartered in Seattle, Washington, TC Global, Inc., dba Tully's Coffee -- http://www.tullyscoffeeshops.com/-- is a specialty coffee retailer and wholesaler. Through company owned, licensed and franchised specialty retail stores in Washington, Oregon, California, Arizona, Idaho, Montana, Colorado, Wyoming and Utah, throughout Asia with Tully's Coffee International, and with its global alliance partner Tully's Coffee Japan, Tully's premium coffees are available at 545 branded retail locations globally. TC Global Inc. filed a Chapter 11 petition (Bankr. W.D. Wash. Case No. 12-20253-KAO) on Oct. 10, 2012. The Debtor is represented by attorneys at Bush Strout & Kornfeld LLP, in Seattle. The Debtor disclosed assets of $4.9 million and debt totaling $3.7 million, including $2.6 million in unsecured claims. The Seattle-based chain has 57 company-owned stores and 12 franchised. There are another 71 franchises in grocery stores, schools and airports. Tully's will close nine stores following bankruptcy. Bloomberg report discloses that Tully's sold the wholesale and distribution business in 2009, generating $40 million that allowed a $5.9 million distribution to shareholders. TNS INC: S&P Puts 'BB-' CCR on Watch Neg over Sirius Deal --------------------------------------------------------- Standard & Poor's Rating Services placed its 'BB-' corporate credit rating on TNS Inc. on CreditWatch with negative implications. This action follows TNS' announcement that it has agreed to be acquired by an investor group led by private equity firm Siris Capital Group for about $862 million, including the refinancing of TNS' senior secured debt. "The CreditWatch listing reflects the prospective new private equity ownership and our expectation that leverage will increase to finance the buyout," said Standard & Poor's credit analyst Michael Weinstein. "Furthermore, we believe that the new ownership structure could lead to a financial policy that is materially more aggressive than the company has historically pursued; therefore, we would likely revise our financial risk assessment of TNS, which is currently 'significant,' with leverage of approximately 3x as of Sept. 30, 2012, adjusted for the present value of operating leases, which amounted to an additional $93 million of debt. As a result of these financial risk considerations, we believe that we would likely lower our corporate credit rating on TNS to the 'B' ratings category upon shareholder approval and completion of the buyout." "The CreditWatch placement is based on our expectations for higher debt leverage associated with the transaction. We plan to review the specific terms of the proposed financing and its effect on leverage and cash flow to resolve the CreditWatch listing. We currently believe that upon completion of the transaction, we would likely lower the corporate credit rating to the 'B' category. In contemplating our ratings outcome, we will evaluate TNS' financial risk profile pro forma the buyout transaction, including prospective heightened leverage and financial policy from owners in conjunction with our existing business risk assessment," S&P said. TOBACCO SETTLEMENT AUTH: Moody's Ups Rating on 2005A Bonds to Ba1 ----------------------------------------------------------------- Moody's Investors Services has upgraded the Series 2005A tobacco settlement bonds issued by Iowa's Tobacco Settlement Authority. The transaction is a securitization of payments owed to the issuer pursuant to the Master Settlement Agreement (MSA) between certain domestic tobacco manufacturers and 46 states and certain territories. Complete rating action is as follows: Issuer: Tobacco Settlement Authority (Iowa), Series 2005 2005A, Upgraded to Ba1 (sf); previously on Sep 8, 2011 Downgraded to B2 (sf) Ratings Rationale The rating action is a result of a correction to the cash flow model that Moody's uses in rating tobacco settlement revenue bonds. The version of the model used in Moody's September 2011 rating action did not use funds in the Debt Service Reserve Account to cover any shortfalls in the payment of principal on the final maturity dates. This resulted in a higher probability of default and severity of loss for the Series than it did when Moody's corrected the model error. Because of the sequential-pay structure of this securitization, the correction of the error had no impact on any other outstanding series issued in this securitization. Principal Methodology The principal methodology used in this rating was "Moody's Approach to Rating Tobacco Settlement Revenues Securitizations" published in May 2011. TONY TEIXEIRA: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Tony Teixeira & Son Dairy 10986 Livingston/Cressey Road Livingston, CA 95334 Bankruptcy Case No.: 12-60065 Chapter 11 Petition Date: December 7, 2012 Court: United States Bankruptcy Court Eastern District of California (Fresno) Judge: Fredrick E. Clement Debtor's Counsel: Peter L. Fear, Esq. LAW OFFICES OF PETER L. FEAR 7750 N Fresno St #101 Fresno, CA 93720-1145 Tel: (559) 436-6575 Scheduled Assets: $1,686,138 Scheduled Liabilities: $6,118,413 A copy of the Company's list of its 11 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/caeb12-60065.pdf The petition was signed by Antonio C. Teixeira, partner. TORCH ENERGY: Receives Continued Listing Standards from NYSE ------------------------------------------------------------ Torch Energy Royalty Trust received a continued listing standards notice from the New York Stock Exchange on Dec. 6, 2012 due to the fact that the average closing price of the Trust's units was less than $1.00 per unit over a period of 30 consecutive trading days. The Trust's units continue to trade on the NYSE. Under NYSE rules, the Trust has six months following receipt of the letter notification to regain compliance with the minimum unit price requirement. The Trust may regain compliance at any time during the six-month cure period if the trust's unit has a closing unit price of at least $1.00 on the last trading day of any calendar month during the period and also has an average closing unit price of at least $1.00 over the 30 trading-day period on the last trading day of that month or on the last day of the cure period. Pursuant to NYSE rules, the Trust intends to notify the NYSE within 10 business days from the receipt of the NYSE notification of its intent to cure the deficiency related to the Trust units within the six-month cure period. Notwithstanding the opportunity for a six-month grace period to return to compliance with NYSE continued listing requirements, given the Trust's termination and the recent market experience with our listed securities, there can be no assurance that the Trust will return to compliance with the NYSE listing standards. Moreover, no assurance can be given that future actions by the Trust or the marketplace will not give rise to alternative bases for potential delisting from the NYSE. About Torch Energy Royalty Trust Headquartered in Wilmington, Detroit, Torch Energy Royalty Trust (NYSE:TRU) -- http://www.torchroyalty.com/-- was formed pursuant to a trust agreement among Wilmington Trust Company, as trustee, Torch Royalty Company, Velasco Gas Company Ltd. and Torch Energy Advisors Incorporated as grantor. TRC and Velasco contracted to sell the oil and gas production from certain oil and gas properties to Torch Energy Marketing Inc., a subsidiary of Torch, under a purchase contract. TRC and Velasco receive payments reflecting the proceeds of oil and gas sold and aggregate these payments, deduct applicable costs and make payments to the Trustee each quarter for the amounts due to the Trust. The Underlying Properties constitute working interests in the Chalkley Field in Louisiana, the Robinson's Bend Field in the Black Warrior Basin in Alabama, Cotton Valley formations in Texas and Austin Chalk formation in Texas. TORM A/S: Regains Compliance With NASDAQ Listing Rules ------------------------------------------------------ TORM A/S TRMD has received confirmation from NASDAQ Listing Qualifications that the Company's American Depository Receipts (ADRs) have closed (bid) at US$1.00 per ADR or greater for ten consecutive trading days. Accordingly, the Company has regained compliance with the NASDAQ Stock Market listing rules. TORM -- http://www.torm.com/-- is one of the world's leading carriers of refined oil products as well as a significant player in the dry bulk market. The Company operates a fleet of approximately 110 modern vessels in cooperation with other respected shipping companies sharing TORM's commitment to safety, environmental responsibility and customer service. TORM was founded in 1889. The Company conducts business worldwide and is headquartered in Copenhagen, Denmark. TRAINOR GLASS: Can Hire Cole Martin to Render Auditing Services --------------------------------------------------------------- Trainor Glass Company obtained permission from the U.S. Bankruptcy Court for the Northern District of Illinois to employ Cole, Martin & Co., Ltd., to render certain auditing services related to the Debtor's 401(k) and profit sharing plan, nunc pro tunc to Aug. 27, 2012. As reported by the TCR on Nov. 23, 2012, Thomas Trainor, as trustee of the Trainor 401(k)/Profit Sharing Plan, entered into agreements with Cole Martin for certain audit services relating to the Trainor 401(k)/Profit Sharing Plan for the year ended Dec. 31, 2011, and for the year ended March 31, 2012, to prepare and file an IRS Form 5500 for the year ended Dec. 31, 2011, and for the year ended March 31, 2012, on Aug. 27, 2012. Cole Martin has rendered the audit services required for the year ended Dec. 31, 2011. Cole Martin's fee for the services is $5,900. Cole Martin has not yet rendered the audit services for the year ended March 31, 2012. About Trainor Glass Trainor Glass Company, doing business as Trainor Modular Walls, Trainor Solar, and Trainor Florida, filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 12-09458) on March 9, 2012. Trainor was founded in 1953 by Robert J. Trainor Sr. to pursue a residential glass business in Chicago, Illinois. Trainor's business model was focused on quality fabrication, design, engineering, and installation of glass products and framing systems in virtually every architectural application, including (a) new construction, (b) green-building solutions, (c) building rehabilitation, (d) storefronts and entrances, (e) tenant interiors, and (f) custom-specialty work. The Hon. Carol A. Doyle oversees the Chapter 11 case. David A. Golin, Esq., Michael L. Gesas, Esq., and Kevin H. Morse, Esq., at Arnstein & Lehr LLP, serve as the Debtor's counsel. High Ridge Partners, Inc., serves as its financial consultant. The Debtor scheduled $14,276,745 in assets and $64,840,672 in liabilities. A three-member official committee of unsecured creditors has been appointed in the case. The committee retained Sugar Felsenthal Grais & Hammer LLP as counsel. TRAINOR GLASS: Exclusive Plan Filing Period Extended to Jan. 8 -------------------------------------------------------------- The Hon. Carol A. Doyle of the U.S. Bankruptcy Court for the Northern District of Illinois extended, at the behest of Trainor Glass Company, the exclusive periods for the Debtor to file a plan until Jan. 8, 2013, and to solicit acceptances of that plan until March 9, 2013. The Debtor has been liquidating its assets with the authorization of the Court. Substantially all of the Debtor's physical assets have now been liquidated. The Debtor has been working closely with the Official Committee of Unsecured Creditors and its secured lender, First Midwest Bank, to discuss the structure of a plan. About Trainor Glass Trainor Glass Company, doing business as Trainor Modular Walls, Trainor Solar, and Trainor Florida, filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 12-09458) on March 9, 2012. Trainor was founded in 1953 by Robert J. Trainor Sr. to pursue a residential glass business in Chicago, Illinois. Trainor's business model was focused on quality fabrication, design, engineering, and installation of glass products and framing systems in virtually every architectural application, including (a) new construction, (b) green-building solutions, (c) building rehabilitation, (d) storefronts and entrances, (e) tenant interiors, and (f) custom-specialty work. The Hon. Carol A. Doyle oversees the Chapter 11 case. David A. Golin, Esq., Michael L. Gesas, Esq., and Kevin H. Morse, Esq., at Arnstein & Lehr LLP, serve as the Debtor's counsel. High Ridge Partners, Inc., serves as its financial consultant. The Debtor scheduled $14,276,745 in assets and $64,840,672 in liabilities. A three-member official committee of unsecured creditors has been appointed in the case. The committee retained Sugar Felsenthal Grais & Hammer LLP as counsel. TRIBUNE CO: Calif. Newspaper Owners May Buy Assets -------------------------------------------------- Reuters' Jennifer Saba and Ronald Grover report that San Diego Union-Tribune owner Doug Manchester and Orange County Register owner Aaron Kushner are interested in acquiring Tribune Co.'s stable of newspapers, according to people familiar with the situation. "If they should become available, we are prepared to take a serious look at purchasing some or all of them if the terms are healthy and we believe, market by market, that we can reverse the downward trajectory of advertising and circulation," Mr. Kushner, head of Freedom Communications, said in a statement, according to Reuters. But Mr. Kushner cautioned that talk of the sale is premature. The sources said Tribune could grab interest for its publishing assets that include the Baltimore Sun and the Orlando Tribune, from other bidders such as News Corp's Rupert Murdoch. Freedom Communication owns the Orange County Register. The report says News Corp and Tribune declined to comment. Mr. Manchester did not immediately respond to comment. Oaktree Capital Management and Angelo Gordon were not immediately available to comment. JP Morgan declined to comment. According to Reuters, the sources said Tribune Co. will be seeking buyers for its newspapers once it emerges from bankruptcy, expected by Dec. 31. The sources also said Oaktree Capital Management, JPMorgan Chase & Co and Angelo, Gordon & Co, the controlling Tribune owners, made the decision to sell off its print business to focus instead on Tribune's television stations in cities like Chicago, New York, and Seattle. Tribune's TV operations are estimated to account for $2.85 billion of the company's $7 billion valuation, while its publishing assets are estimated to represent $623 million, according to report by its financial advisor Lazard, Reuters relates. The rest of its value resides in other assets including its stake in the Food Network and its cash balance. Tribune also owns WGN America, a national news feed of its Chicago station, which it repackages as a super-station and distributes through cable and satellite to more than 76 million homes, according to Nielsen Co. data., Reuters relates. Reuters also reports that Tribune's owners are expected to name industry veteran Peter Liguori, a former Fox and Discovery Communications executive, as its CEO once it emerges from bankruptcy. The owners are also negotiating with Peter Murphy, Walt Disney Co's former top strategic planner, to become its chief operating officer, said two people with knowledge of the talks. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Protracted negotiations and mediation efforts and numerous proposed plans of reorganization filed by Tribune Co. and competing creditor groups have delayed Tribune's emergence from bankruptcy. Many of the disputes among creditors center on the 2007 leveraged buyout fraudulence conveyance claims, the resolution of which is a key issue in the bankruptcy case. The bankruptcy court has scheduled a May 16 hearing on Tribune's plan. Judge Kevin J. Carey issued an order dated July 13, 2012, overruling objections to the confirmation of Tribune Co. and its debtor affiliates' Plan of Reorganization. In November 2012, Tribune received approval from the Federal Communications Commission to transfer media licenses, one of the hurdles to implementing the reorganization plan. Aurelius Capital Management LP failed in halting implementation of the plan pending appeal. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Said to Be Hiring Bankers to Sell Newspaper Assets -------------------------------------------------------------- Bloomberg News' Edmund Lee and Serena Saitto report that, according to two people with knowledge of the matter, Tribune Co. is interviewing bankers about selling its papers. Bloomberg said the sources asked not to be named because the talks are private. The sources said Tribune's owners are seeking an adviser for a possible sale after Tribune exits bankruptcy, which is slated to happen by Dec. 31. Bloomberg also relates that one person familiar with Rupert Murdoch's thinking said the chairman and chief executive officer of News Corp. plans to take a close look at Tribune's newspaper assets once they're available. According to the report, Reed Phillips, managing partner of investment bank DeSilva & Phillips LLC, who isn't involved in the discussions and doesn't have direct knowledge of the matter, said the owners may hold onto the larger newspapers, such as the ones in Los Angeles and Chicago, and look to sell the smaller titles more immediately. Bloomberg notes Gary Weitman, a spokesman for Chicago-based Tribune Co., declined to comment, as did Nathaniel Brown, a spokesman for News Corp. in New York. In November, Tribune won approval from the Federal Communications Commission to transfer its television and radio licenses to new owners -- including JPMorgan Chase & Co., and hedge funds Oaktree Capital Management LP and Angelo, Gordon & Co. -- the last hurdle to emerging from bankruptcy. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Co. -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North America LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Chadbourne & Parke LLP and Landis Rath LLP serve as co-counsel to the Official Committee of Unsecured Creditors. AlixPartners LLP is the Committee's financial advisor. Landis Rath Moelis & Company serves as the Committee's investment banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the Committee in connection with the lawsuit filed against former officers and shareholders for the 2007 LBO of Tribune. Protracted negotiations and mediation efforts and numerous proposed plans of reorganization filed by Tribune Co. and competing creditor groups have delayed Tribune's emergence from bankruptcy. Many of the disputes among creditors center on the 2007 leveraged buyout fraudulence conveyance claims, the resolution of which is a key issue in the bankruptcy case. The bankruptcy court has scheduled a May 16 hearing on Tribune's plan. Judge Kevin J. Carey issued an order dated July 13, 2012, overruling objections to the confirmation of Tribune Co. and its debtor affiliates' Plan of Reorganization. In November 2012, Tribune received approval from the Federal Communications Commission to transfer media licenses, one of the hurdles to implementing the reorganization plan. Aurelius Capital Management LP failed in halting implementation of the plan pending appeal. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) UPPER DECK: Dutch Insolvency Proceeding Recognized in U.S. Courts ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York recognized the Dutch insolvency proceedings of Upper Deck International B.V., as a foreign main proceeding pursuant to Sections 1515 and 1517(a) of the Bankruptcy Code. UDI's center of main interests is located in The Netherlands. Loes A. van Kooten-Hendriks, as insolvency administrator, is recognized as the foreign representative of UDI in the Chapter 15 case in the U.S. The insolvency administrator is entitled to, among other things: seek or respond to discovery, examine witnesses, seek and take evidence, and deliver or obtain information concerning UDI's assets, affairs, rights, obligations, or liabilities pursuant to Section 1521(a)(4) of the Bankruptcy Code. About Upper Deck International Upper Deck International B.V., aka Upper Deck Europe B.V., the European arm of the sports trading-card company, is in insolvency proceedings in The Netherlands. Loes A. van Kooten-Hendriks, serves as Insolvency Administrator and putative foreign representative of Upper Deck International B.V. On Oct. 18, 2012, the foreign representative filed a petition under Chapter 15 of the Bankruptcy Code for recognition of the foreign proceeding. The foreign representative is represented in the U.S. case by David Farrington Yates, Esq., and Oscar N. Pinkas, Esq., at SNR Denton US LLP. Bankruptcy Judge Stuart M. Bernstein oversees the case. UDI was in the business of, inter alia, publishing, producing and distributing, as well as wholesale trading in, sports and amusement cards and stickers, in particular collectable trading cards, and acquiring capitalizing upon patents, trade names and trademarks. The Debtor is estimated to have at least US$50 million in assets and liabilities up to US$50,000. Judge Stuart M. Bernstein presides over the Chapter 15 case. VERTIS HOLDINGS: Direct Fee Review Appointed as Fee Examiner ------------------------------------------------------------ The U.S. bankruptcy Court for the District of Delaware approved the appointment of Direct Fee Review, LLC as fee examiner in the Chapter 11 cases of Vertis Holdings, Inc., et al. The fee examiner is expected to, among other things: a) review interim and final fee applications filed by each applicant in the Chapter 11 cases of the Debtors; b) review, to the extent appropriate, any relevant documents filed in the Chapter 11 cases to be generally familiar with the Chapter 11 cases and its dockets; and c) serve each final report on counsel for the Debtors, the Office of the U.S. Trustee for the District of Delaware, counsel for the Creditors' Committee, counsel to the General Electric Capital Corporation, as administrative agent of the Debtors' prepetition revolving credit facility, and each applicant whose fees and expenses are addressed in the final report. 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%. GE Capital Corporation, which serves as DIP Agent and Prepetition Agent, is represented in the 2012 case by lawyers at Winston & Strawn LLP. Morgan Stanely Senior Funding Inc., the agent under the prepetition term loan, and as term loan collateral agent, is represented by lawyers at White & Case LLP, and Milbank Tweed Hadley & McCloy LLP. VILLAGE GREEN: Artificial Impairment of Claims Discussed in Case ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a case is percolating toward the U.S. Court of Appeals in Cincinnati, a circuit court that hasn't yet laid down a rule on what constitutes "artificial impairment" that can assist a bankrupt company in cramming down a plan on creditors. According to the report, the case involves an apartment project with a plan setting up three creditor classes. The secured lender is in two classes, one for the secured portion of the claim and the second for the unsecured deficiency. The third class has two unsecured creditors with claims aggregating $2,400. The class was to receive full payment in two installments one and two months after consummation of the plan. The two unsecured creditors accepted the plan. The bankruptcy court crammed down the plan on a lender. The lender appealed and won a remand. According to the report, U.S. District Judge S. Thomas Anderson in Memphis, Tennessee, said the Sixth Circuit in Cincinnati is yet to rule on what constitutes artificial impairment for the purpose of securing an accepting class of creditors and making cramdown possible on a secured lender. Without saying whether artificial impairment is an issue under Sections 1129(a)(10) or 1129(a)(3) of the Bankruptcy Code, Judge Anderson sent the case back to bankruptcy court for a determination of whether there was "some economic justification for delaying payment to the de minimis creditors." The case is Federal National Mortgage Association v. Village Green I GP, 12-2163, U.S. District Court, Western District of Tennessee (Memphis). Village Green I GP owned the Village Green Apartments located at 3450 Fescue Lane in Memphis, Tenn. Village Green sought Chapter 11 protection (Bankr. W.D. Tenn. Case No. 10-24178) on April 16, 2010. John L. Ryder, Esq., at Harris Shelton Hanover Walsh, PLLC, in Memphis, Tenn., represents the single-asset real estate debtor. The debtor estimated its assets and debts at less than $10 million in its bankruptcy petition. Fannie Mae is owed about $9.2 million. VISTEON CORP: Moody's Affirms 'B1' CFR/PDR; Outlook Stable ---------------------------------------------------------- Moody's Investors Service affirmed Visteon Corporation's Corporate Family (CFR) and Probability of Default Rating (PDR) at B1 and changed the outlook of the company's $500 million of senior unsecured notes to stable from negative. The Speculative Grade Liquidity rating is unchanged at SGL-3. The affirmation and change in outlook reflect Moody's expectation that the company will not undertake further actions to acquire the remaining 30 percent of the public shares of its Korean affiliate, Halla Climate Control Corp. (HCC) following the expiry of Visteon's unsuccessful tender offer in July 2012. Had Visteon been successful in acquiring these shares, it would have resulted in the company's existing rated debt being structurally subordinate to new debt at HCC used to fund the purchase of the shares. The affirmation also incorporates the company's announcement that it has given the required notice under the governing indenture to redeem $50,000,000 of its senior unsecured notes. The following ratings were affirmed: Visteon Corporation: Corporate Family Rating, at B1; Probability of Default, at B1; B2 (LGD4, 59%), for the $500 million guaranteed senior unsecured notes Speculative Grade Liquidity Assessment, at SGL-3; The asset based revolving credit facility is not rated by Moody's. Ratings Rationale Visteon's B1 Corporate Family Rating incorporates the company's modest profit margins in the 3% to 5% range (including Moody's adjustments) which has resulted in Free Cash Flow/Debt at about 3.7%. Both of these metrics are supportive of the assigned rating and benefit from the company's diverse geographic revenue base and business with growing customers. Yet, economic uncertainty in Europe (about 33% of revenues) and slow growth in the company's Asia Pacific markets (about 43% of revenues) will constrain growth over the near-term. The ratings also incorporate the risks around the company's announced plans to contribute its climate control business to its 70% owned subsidiary, Halla Climate Control, and announced restructuring and other costs of approximately $100 million to allow the company to further reduce SG&A and other fixed costs in 2013. These restructuring actions are in addition to major cost reduction actions completed in 2010. Moody's also believes there are risks involved with the company's ability to access funds generated by its foreign subsidiaries and joint ventures on a timely and cost effective basis. The stable rating outlook incorporates Visteon's strong credit metrics and good liquidity profile balanced with the company's developing strategic direction and financial policies. Visteon is anticipated to have an adequate liquidity profile over the near-term supported by cash balances and availability under the asset-based revolving credit facility. Unrestricted cash balances as of September 30, 2012 were approximately $901 million. About 60% of this cash was located in non-guarantor subsidiaries including the company's joint ventures where Moody's believes there are risks involved with the company's ability to access these funds. As of September 30, 2012, the $175 million asset- based revolver had no cash drawings and has a borrowing capacity of $156 million. While modest in size, the facility is expected to be largely undrawn over the near-term. Visteon's free cash flow generation is expected to be positive over the near-term term as previous capital expenditures to support higher revenues moderate. Free cash flow generation also is expected to be pressured by weakening demand in Europe. The asset-based revolving credit facility does not have financial covenants. Alternate liquidity is limited by debt incurrence covenants under the credit facilities. Consideration for a higher outlook or rating would require continued operating performance improvement supporting EBIT/interest above 3.0x and sustaining Debt/EBITDA at about 2.5x. Sustaining positive free cash flow generation would also be a consideration for a potential positive rating action. Developments that could lead to lower outlook or ratings include deterioration in automotive industry conditions that are not offset by cost saving actions resulting in EBIT/interest sustained below 2.5x or Debt/EBITDA sustained above 3.5x. Deteriorating liquidity could also lead to a lower outlook or rating. The principal methodology used in rating Visteon was the Global Automotive Supplier Industry Methodology published in January 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Visteon, headquartered in Van Buren Township, Michigan, is a leading global automotive supplier that designs, engineers and manufactures innovative climate, electronic, interior and lighting products for vehicle manufacturers. The company has facilities in 26 countries and employs approximately 26,000 people. Revenues for the year ending December 31, 2011 were approximately $8.0 billion. VOICES OF FAITH: Court OKs Oracle Real Estate as Appraiser ---------------------------------------------------------- Voices of Faith Ministries, Inc. sought and obtained approval from the U.S. Bankruptcy Court to employ Oracle Real Estate Services LLC as its real estate appraiser. The Debtor said it is in the process of compiling information necessary to complete its proposed plan of reorganization. In that regard, it must ascertain the current fair market value of the property. The appraisers at Oracle who will be handling the matter include Joseph N. Kusmik and Debra R. Forrest. The estimated cost of the appraisals is $16,650. Oracle also requested payment of a refundable travel expense retainer in the amount of $1,500 to cover the travelling and licensing needed to appraise the property located in Louisiana. Voices of Faith Ministries, Inc., is a Georgia non-profit corporation that operates a Christian faith church known as Voices of Faith Ministries. It has 10,000 attending members and five locations. The Debtor's properties consist of seven buildings and two parcels of vacant land located in Georgia and Louisiana. Based in Stone Mountain, Georgia, Voices of Faith filed for Chapter 11 bankruptcy (Bankr. N.D. Ga. Case No. 11-85028) on Dec. 5, 2011. The petition was signed by Gary Hawkins, Sr., CEO. The Debtor has hired Moore Law Group LLC and Geiger Law LLC as co- bankruptcy counsel. WATERFRONT OFFICE: Five Mile's 2 Stamford Buildings in Chapter 11 ----------------------------------------------------------------- The Wall Street Journal's Developments Blog reports that private- equity firm Five Mile Capital Partners LLC and Stamford, Conn.- based investor Building and Land Technology placed two office complexes in Stamford in Chapter 11 bankruptcy late last month to stall foreclose attempts by German bank Deutsche Genossenschafts- Hypothekenbank. The report recounts Five Mile obtained the 600 Summer St. and Stamford Landing complexes in 2010 when it used a delinquent, $15 million mezzanine loan on the properties to seize them from local owner Antares Inc. The report relates in August 2012, the properties' $55 million first mortgage came due. Five Mile wasn't able to work out a compromise with mortgage holder Deutsche Genossenschafts- Hypothekenbank. The report notes the lender tapped brokerage Eastdil Secured to help market the properties in advance of a foreclosure auction Nov. 28, but Five Mile put the properties into bankruptcy just before it. The bankruptcy petitions were filed in U.S. Bankruptcy Court in Connecticut. Waterfront Office Building LP and Summer Office Building LP filed for Chapter 11 protection (Bankr. Conn.D.C. Case Nos. 12-52121 and 12-52122) on Nov. 27, 2012. Waterfront estimated at least $50 million in assets and at least $50 million in liabilities. Summer estimated at least $10 million in assets and at least $50 million in liabilities. James Berman, Esq., at Zeisler And Zeisler, P.C., in Bridgeport, Connecticut, serve as counsel to the Debtors. WATERSCAPE RESORT: Court Rules on Pavarini's Summary Judgment Bid ----------------------------------------------------------------- Bankruptcy Judge Stuart M. Bernstein granted, in part, and denied, in part, Pavarini McGovern LLC's request for summary judgment in its class action adversary complaint against Waterscape Resort LLC. Pavarini was retained as general contractor by Waterscape to construct a building in Manhattan. Allegedly owed roughly $11 million, Pavarini commenced the class action contending that Waterscape diverted certain trust fund monies owed to Pavarini and, ultimately, the subcontractors that worked on the Project. U.S. Bank, National Association and USB Capital Resources, Inc. f/k/a USB Capital Funding Corp., provided loan facilities to Waterscape to refinance pre-existing debt and fund the construction of the Project, a 45-story hotel and condominium building located at 66-70 West 45th Street in Manhattan. Pavarini also sued U.S. Bank. In July 2011, Waterscape confirmed its Second Amended Plan of Reorganization roughly one month after Pavarini commenced the adversary proceeding. The Plan contemplated the sale of the hotel portion of the Project free and clear of all liens, claims and interests, and all but $14 million from the hotel sale proceeds would be paid to U.S. Bank in partial satisfaction of its Class 1 claim. The balance would fund an $11 million Trust Fund Account for the benefit of the overlapping Class 3 Lien Law/trust fund claimants; the remaining $3 million would fund the Class 5 Reserve Account for the benefit of the unsecured creditors in that class. The lawsuit is, PAVARINI McGOVERN, LLC, Plaintiff, v. WATERSCAPE RESORT LLC, et al., Defendants, Adv. Proc. No. 11-02248 (Bankr. S.D.N.Y.). A copy of the Court's Dec. 10, 2012 Memorandum Decision is available at http://is.gd/6H64vffrom Leagle.com. Eric W. Sleeper, Esq. -- esleeper@bartonesq.com -- at Barton LLP, argues for Pavarini McGovern. About Waterscape Resort Waterscape Resort LLC, aka Cassa NY Hotel and Residences, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 11-11593) on April 5, 2011. Waterscape acquired property consisting of three contiguous buildings at 66, 68 and 70 West 45th Street in Manhattan, for the sum of $20 million, and developed the property into a 45-storey condominium project including a luxury hotel, a restaurant and luxury residential apartments. The purchase was financed with a $17 million acquisition loan and mortgage from U.S. Bank Association. The Cassa NY Hotel and Residences features 165 hotel rooms, and above the hotel units, 57 residences. Brett D. Goodman, Esq., and Lee William Stremba, Esq., at Troutman Sanders LLP represent the Debtor as Bankruptcy Counsel. Holland & Knight LLP serves as its special litigation counsel. The Debtor disclosed $214,285,027 in assets and $158,756,481 in liabilities as of the Chapter 11 filing. A 3-member Official Committee of Unsecured Creditors has been appointed in the Debtor's Chapter 11 case. Schiff Hardin LLP, serves as the Committee's counsel. U.S. Bankruptcy Judge Stuart Bernstein confirmed Waterscape's reorganization plan on July 22, 2011, which calls for repaying much of the company's debt with proceeds from the $128 million sale of the hotel section of the development. The Plan was filed on May 6, 2011. * Moody's Says U.S. Telecom Sector Faces Dividend Dilemma --------------------------------------------------------- Yield-hungry investors have driven US telecom stocks to large valuation premiums, but these are unlikely to be sustainable, Moody's Investors Service says in a new report, "Dividend Dilemma for Telecoms: How to Support Stock Prices When Interest Rates Rise." "Low rates have drawn income-seeking investors to the telecommunications sector, but given the sector's slow growth, current equity premiums are likely to come under pressure from higher dividend tax rates following the 'fiscal cliff' talks in the short term, and from rising interest rates in the longer term," says analyst and author of the report Mark Stodden. This could set the stage for credit negative actions as companies seek to support their stock prices, Stodden says. They could increase dividends in line with interest rates, seek growth through debt-financed capital investments or M&A, or borrow to buy back shares. All these actions could lead to higher leverage, and ultimately pressure companies' ratings. If fiscal cliff negotiators allow the current 15% dividend tax rate to expire at the end of this year, a 35% dividend tax rate would reduce the weighted average after-tax telecom dividend yield to 3.4% from 4.5%, narrowing its risk premium to the 10-year Treasury yield by 105 basis points. And the 10-year US Treasury yield is projected rise to 4.1% in late 2015 from about 1.6%, also making telecom stocks less attractive. "Combined with a 35% dividend tax rate, Moody's estimates that the premium of the after-tax telecom dividend yield to the 10-year Treasury could decline to 80 basis points from 345 currently," Stodden says. Among the large telecoms, AT&T has announced plans to increase leverage to fund additional capital investment and continue share repurchases, while Verizon has less flexibility to act due to its lower rating and limited free cash, but the most incentive to do so. The smaller, lower-rated companies have still less flexibility, and are currently trying to reduce their debt while at the same time maintaining their credit profiles and sustaining high dividend payouts. * Moody's Says Distressed Transactions Hit CBD Office Prices ------------------------------------------------------------ Moody's: Central business district (CBD) office real estate prices continue to outperform other core commercial sectors, reflecting strong institutional demand even as there was a 1.0% decline in core commercial overall as measured by the Moody's/RCA Commercial Property Price Indices (CPPI) for October. CBD office prices increased by 9.6% and 17.4% over the last three- and 12- month periods, respectively, according to the report, "Moody's/RCA CPPI: CBD Office Outperforms Other Core Commercial Sectors, Reflecting Strong Institutional Demand." "The CPPI national all-property composite price declined 0.5% in October as a 0.6% gain in apartment was offset by the decline in core commercial," said Moody's Director of Commercial Real Estate Research Tad Philipp. "Though commercial real estate prices have climbed 27.7% since the November 2009 trough, they remain 22.4% below the December 2007 peak." The apartment sector has recovered to within 12.2% of its December 2007 peak level, while core commercial is 25.2% below its December 2007 level. "Distressed transactions currently make up approximately one- quarter of recent repeat sales observations, down from approximately one-third between early 2010 and mid 2011," said Mr. Philipp. "Distressed transactions, which are included in the repeat sales data on which CPPI is based, have had a meaningful negative impact on price appreciation for the market as a whole." He said prices excluding distressed transactions have regained 70.6% of their peak-to-trough loss, outpacing the 43.0% regained in Moody's national all-property index that includes distressed transactions. "Aside from the six major metro areas as designated by the CPPI, we examined price performance in nine of the larger metro areas or combinations of metro areas within a region," said Mr. Philipp. "Four of them, South Florida, Philadelphia/Baltimore, San Diego and Seattle, outperformed the national all property index since June 2001." Two areas, Denver and a composite of Dallas, Houston and Austin, have seen appreciation since June 2001, although less than that of the national all property index leaders. Three of the largest of the non-major metro areas, Atlanta, Las Vegas and Phoenix, have prices below June 2001 levels. Las Vegas prices are 63% below their December 2007 peak, but appear to have formed a bottom within the last few months. Composed of a suite of 20 indices, the Moody's/RCA Commercial Property Price Indices is a series that measures price changes in US commercial real estate through advanced repeat-sale regression (RSR) analytics. The indices use transaction data from Real Capital Analytics (RCA) and a methodology developed by David Geltner, a professor at the Massachusetts Institute of Technology, in conjunction with Moody's and RCA. * Moody's Says High-Yield Bond Covenant Quality Hits Record Low --------------------------------------------------------------- Covenant quality hit a record low in November after showing slight improvement in October, Moody's Investors Service says in a new report, "Covenant Quality of US Bonds Reaches Record Low in November." "November's high-yield bond offerings had weaker investor protections, continuing the deteriorating trend seen since July this year," says Vice President -- Head of Covenant Research, Alexander Dill. "And in fact they offered the least protection since we began tracking bond covenant quality in January 2011." On Moody's five-point scale, with 1.0 representing the strongest covenant protection and 5.0 the weakest, the average Covenant Quality (CQ) score was 4.15 in November, breaching the previous record in low covenant quality of 4.09 reached in September 2011, Dill says. Some 30% of November issuance had high-yield-lite covenant packages (in which limitations on dividends and/or debt is absent), compared with 17.2% historically, but bonds with full packages also had weak average covenant quality. Bond issuance last month also continued to flout the relationship between ratings and covenant quality. Usually lower-rated bonds have stronger covenant packages than higher-rated ones because investors expect weaker credits to offer more protection. That relationship broke down in October. "November was the second consecutive month that Caa-rated bonds had weaker average CQ scores than B rated bonds," Dill says. However, covenant quality was weak across the speculative-grade ratings spectrum. The chemicals sector had the weakest covenant quality of any of the broad sectors included in Moody's High-Yield Covenant Quality Database. Huntsman International LLC and GrafTech International Ltd. both issued high-yield lite bonds, and Celanese's full covenant package was one of the weakest in the database. But covenant quality declined across many sectors this year, associate analyst Matthew Musicaro says in a second report, "Many Sectors Saw Weaker Covenants in 2012." Bonds issued by chemical companies and midstream master limited partnerships were the stand-outs, Musicaro says. Of the 13 broad sectors with at least five bond issues in 2012 and 2011, covenant quality deteriorated in six, improved in three, while the remaining four held steady. * Moody's Says Pension Funding Bonds Bring Risks to Government ------------------------------------------------------------- Pension funding bonds, also known as pension obligation bonds, rarely improve the credit quality of the state or the local government that issues them, says Moody's Investors Service in a new report. Whether the bonds will have either a neutral or negative impact on the government's credit quality at the time of issuance depends on factors that include the use of the proceeds, the relative size of the bond issue, and the level of future budget savings that government managers assume from the issuance. Moody's explores the credit implications of pension funding bonds in the new report, "State and Local Governments Face Risks with Pension Funding Bonds." "If bond proceeds substitute for annual contributions to pension plans or are used to pay pensioners, we consider it a deficit borrowing and would view the financing as credit negative, particularly if it is large relative to the budget (e.g. over 5%), is part of a continuous pattern of reliance on one-time resources, or is used in the absence of a plan to restore budget stability over the medium term," said Marcia Van Wagner, Moody's Vice President -- Senior Analyst who wrote the report. "In general, we consider it to be positive for credit when management strategies are directed toward sustained improvement in net funded status of the pension plan, but negative for credit when management strategies primarily seek near-term budget savings without improvement in pension funded status." If pension bonds merely shifted an issuer's long term obligations from one similar form to another, in this case from an unfunded pension liability to bonded debt, they would tend to have a neutral credit impact, says Moody's. Their risks, however, may include budget risks stemming from the government's anticipated high returns on bond proceeds as well as the possibility of a market downturn that could wipe out a portion of the proceeds. Moody's rates pension bonds based on the pledged security, which may be a general obligation of the issuing government, an appropriation obligation, or debt backed by a special revenue stream such as the sales tax. Regardless of the specific security pledge and rating, the debt always becomes part of Moody's assessment of the issuing government's general credit profile and general obligation rating. It is therefore possible that a strong security on the bonds themselves could warrant a high rating but that the issuance of the bonds is sufficiently credit negative to put downward pressure on the issuer's rating. "Governments contemplating pension bonds must sift through a number of factors influencing their decisions, including the specifics of their pension plans and the structure of the bonds," says Van Wagner. "However, pension bonds are often a red flag associated with greater rigidity of long term obligations, failure to find sustainable solutions to pension funding and a pattern of pushing costs off into the future. For this reason, most pension bonds have, at best, a neutral impact on our overall assessment of an issuer's credit quality." * Supreme Court Refuses to Hear Trademark Rejection Case -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Supreme Court refused to hear an appeal that would have put to rest a long-simmering dispute at the intersection of trademark and bankruptcy law. According to the report, the question is whether a bankrupt company's rejection of a trademark license agreement bars the licensee from further use of the mark. Federal appeals courts are split on whether someone licensing a trademark is at risk of losing use of the intellectual property if the mark's owner files for bankruptcy. The circuit split arose from an opinion in July from the U.S. Court of Appeals in Chicago. The report recounts that the case involved a fan-maker and a contract dating from before bankruptcy allowing a manufacturer to produce and sell fans using the soon-to-be bankrupt's patents and trademarks. After bankruptcy, the trustee rejected the contract and sued to stop the manufacturer from using the trademarks. Bankruptcy court rejection of a contract is akin a court- authorized breach, Mr. Rochelle notes. According to the report, the parties didn't disagree with the ruling of the bankruptcy court that Section 365(n) of the Bankruptcy Code allowed the manufacturer to continue using the patents. The question before the Seventh Circuit in Chicago was whether the manufacturer could continue using the bankrupt's trademarks. In its July opinion, the Chicago appeals panel disagreed with a 1985 decision from the U.S. Court of Appeals in Richmond, Virginia, named Lubrizol Enterprises v. Richmond Metal Finishers Inc. In Lubrizol, the Fourth Circuit appeals court ruled that rejection of an executory contract licensing intellectual property halts the non-bankrupt's right to use patents, trademarks and copyrights. Three years later, Congress changed the law so that rejection of a contract wouldn't halt the right to use patents and copyrights. The new section, 365(n), was silent about trademarks. Some courts since then interpreted the omission to mean that rejecting a license for trademarks terminates the right to use the marks. The report notes that in the Chicago case, Circuit Judge Frank Easterbrook looked at Section 365, which governs rejection of contracts. Unlike the Lubrizol court, he found nothing in the section that forces the non-bankrupt party to stop using trademarks when the contract is rejected. According to the report, Judge Easterbrook based his conclusion on the proposition that a licensor's breach outside of bankruptcy doesn't preclude the licensee from continuing to use a trademark license. He said that rejecting a contract converted unfulfilled obligations to damages. "But nothing about this process implies than any other rights of the other contracting party have been vaporized," Easterbrook said. Whether Judge Easterbrook was right won't be decided by the Supreme Court. The high court decided on Dec. 10 not to hear the appeal. The attempted appeal to the Supreme Court was Sunbeam Products Inc. v. Chicago American Manufacturing LLC, 12-431, U.S. Supreme Court. The Chicago case in the Court of Appeals was Sunbeam Products Inc. v. Chicago American Manufacturing LLC, 11-3920, U.S. Court of Appeals for the Seventh Circuit (Chicago). * Right to Appeal Is Estate Property and May Be Sold ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the right to appeal a pre-bankruptcy judgment against the bankrupt is property of the estate which the trustee has the right to sell, according to a Dec. 10 opinion by U.S. District Judge Xavier Rodriguez in San Antonio. According to the report, the case involved an individual against whom a judgment was entered before bankruptcy. He appealed, and the appeal was held in abeyance following a Chapter 7 filing. The judge found two cases with opposite results on the same question. One from California concluded that the right to appeal a judgment against a bankrupt isn't estate property. A case from Iowa reached the opposite conclusion. The report relates that Judge Rodriguez concluded that the right to a defensive appeal is estate property under Texas and federal bankruptcy law. The bankrupt, the report discloses, argued that selling the right to appeal would vitiate his right to appeal and prevent him from diminishing claims against the estate. Judge Rodriguez said the issue was of no concern because the bankruptcy court structured procedures where the bankrupt still had the ability to object to the sale of appellate rights. The case is Lowry v. Croft (In re Croft), 12-cv-535, U.S. District Court, Western District of Texas (San Antonio). * Recent Small-Dollar & Individual Chapter 11 Filings ----------------------------------------------------- In re Japeh Youssefi Bankr. D. Ariz. Case No. 12-25736 Chapter 11 Petition filed November 30, 2012 In re Mark Garcia Bankr. E.D. Calif. Case No. 12-93049 Chapter 11 Petition filed November 30, 2012 In re Rosendo Jaime Bankr. E.D. Calif. Case No. 12-19873 Chapter 11 Petition filed November 30, 2012 In re Roy Campbell Bankr. M.D. Fla. Case No. 12-07719 Chapter 11 Petition filed November 30, 2012 In re Ruslo, Inc. Bankr. S.D. Fla. Case No. 12-38745 Chapter 11 Petition filed November 30, 2012 See http://bankrupt.com/misc/flsb12-38745.pdf represented by: David Marshall Brown, Esq. David Marshall Brown, P.A. E-mail: DavidBrownfll@gmail.com In re Paula Fredericks Bankr. N.D. Ga. Case No. 12-79446 Chapter 11 Petition filed November 30, 2012 In re John Ing Bankr. D. Hawaii Case No. 12-02358 Chapter 11 Petition filed November 30, 2012 In re Joseph Dvornik Bankr. N.D. Ill. Case No. 12-47311 Chapter 11 Petition filed November 30, 2012 In re A. James Bankr. S.D. Ind. Case No. 12-14090 Chapter 11 Petition filed November 30, 2012 In re Michael Stamp Bankr. W.D. Mich. Case No. 12-10430 Chapter 11 Petition filed November 30, 2012 In re Bread Oven, Inc. Bankr. D. Nebr. Case No. 12-82714 Chapter 11 Petition filed November 30, 2012 See http://bankrupt.com/misc/neb12-82714p.pdf See http://bankrupt.com/misc/neb12-82714c.pdf Filed pro se In re Eric Bowers Bankr. D. Nev. Case No. 12-23220 Chapter 11 Petition filed November 30, 2012 In re Heath Lewis Bankr. D. Nev. Case No. 12-23208 Chapter 11 Petition filed November 30, 2012 In re Kenneth Barnes Bankr. D.N.J. Case No. 12-38031 Chapter 11 Petition filed November 30, 2012 In re Kevin Driscoll Bankr. E.D.N.C. Case No. 12-08453 Chapter 11 Petition filed November 30, 2012 In re Gary Dyer Bankr. S.D. Ohio Case No. 12-60247 Chapter 11 Petition filed November 30, 2012 In re Karey Dyer Bankr. S.D. Ohio Case No. 12-60247 Chapter 11 Petition filed November 30, 2012 In re James Kline Bankr. D. Ore. Case No. 12-65099 Chapter 11 Petition filed November 30, 2012 In re Bechtold Builders, Inc. Bankr. E.D. Pa. Case No. 12-21128 Chapter 11 Petition filed November 30, 2012 See http://bankrupt.com/misc/paeb12-21128.pdf represented by: Thomas Daniel Bielli, Esq. O'Kelly Ernst & Bielli, LLC E-mail: tbielli@oeblegal.com In re Cuerpo De Seguridad Privada, Corp. Bankr. D.P.R. Case No. 12-09472 Chapter 11 Petition filed November 30, 2012 See http://bankrupt.com/misc/prb12-09472.pdf represented by: Wanda I. Luna Martinez, Esq. Luna Law Offices E-mail: quiebra@gmail.com In re Francisco Mendez Matos Bankr. D.P.R. Case No. 12-09524 Chapter 11 Petition filed November 30, 2012 In re Edward Caughman Bankr. D.S.C. Case No. 12-07426 Chapter 11 Petition filed November 30, 2012 In re Reconciliation Ministry-East Bankr. D.S.C. Case No. 12-07410 Chapter 11 Petition filed November 30, 2012 Filed pro se In re Roger Beu Bankr. M.D. Tenn. Case No. 12-10944 Chapter 11 Petition filed November 30, 2012 In re Linda Johnson Bankr. E.D. Tex. Case No. 12-38818 Chapter 11 Petition filed November 30, 2012 In re Timpanogos Partners, Ltd. Bankr. N.D. Tex. Case No. 12-37458 Chapter 11 Petition filed November 30, 2012 See http://bankrupt.com/misc/txnb12-37458.pdf In re Anointed Ones, Inc. Bankr. N.D. Ga. Case No. 12-79665 Chapter 11 Petition filed December 1, 2012 See http://bankrupt.com/misc/ganb12-79665.pdf represented by: Tami Wells Thomas, Esq. Taylor Thomas, LLC E-mail: tamiwellsthomas@gmail.com In re Dina Dini Bankr. C.D. Calif. Case No. 12-23729 Chapter 11 Petition filed December 2, 2012 In re Lee Del Giorgio Bankr. D. Ariz. Case No. 12-25845 Chapter 11 Petition filed December 4, 2012 In re Coastal ATM Inc. Bankr. C.D. Calif. Case No. 12-14447 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/cacb12-14447.pdf represented by: Daniel A. Higson, Esq. The Law Offices of Daniel A Higson E-mail: dhigson30@aol.com In re Juan Gonzalez Bankr. C.D. Calif. Case No. 12-14445 Chapter 11 Petition filed December 4, 2012 In re Perla Fabelo Bankr. C.D. Calif. Case No. 12-23813 Chapter 11 Petition filed December 4, 2012 In re Telesforo Medrano Bankr. C.D. Calif. Case No. 12-36809 Chapter 11 Petition filed December 4, 2012 In re Westco Inc. Bankr. C.D. Calif. Case No. 12-49930 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/cacb12-49930.pdf represented by: Richard E. Dwyer, Esq. Law Office of Richard Dwyer E-mail: attorneyricharddwyer@gmail.com In re William Adams Bankr. N.D. Calif. Case No. 12-49610 Chapter 11 Petition filed December 4, 2012 In re Robert Salzano Bankr. S.D. Calif. Case No. 12-16006 Chapter 11 Petition filed December 4, 2012 In re Firepit Pizza & BBQ LLC Bankr. M.D. Fla. Case No. 12-18289 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/flmb12-18289.pdf represented by: Charles PT Phoenix, Esq. Phoenix File & Pagidipati PLLC E-mail: cptp@phoenixfile.com In re Joseph Gaeta Bankr. M.D. Fla. Case No. 12-18321 Chapter 11 Petition filed December 4, 2012 In re Poplar Street Investors, LLC Bankr. M.D. Ga. Case No. 12-53451 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/gamb12-53451.pdf represented by: Wesley J. Boyer, Esq. Katz, Flatau, Popson and Boyer, LLP E-mail: wjboyer_2000@yahoo.com In re Nerison's Construction, Inc. Bankr. D. Mass. Case No. 12-19497 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/mab12-19497.pdf represented by: Gershon M. Gulko, Esq. E-mail: gulkothelawyer@yahoo.com In re Nicholas Rowe Bankr. D.N.H. Case No. 12-13684 Chapter 11 Petition filed December 4, 2012 In re Carlos Moreno Gonzlez Bankr. D.P.R. Case No. 12-09596 Chapter 11 Petition filed December 4, 2012 In re Future Advance Technical Institute, Inc. Bankr. D.P.R. Case No. 12-09588 Chapter 11 Petition filed December 4, 2012 See http://bankrupt.com/misc/prb12-09588.pdf represented by: Ada M. Conde, Esq. E-mail: condelawpr@gmail.com In re Carlos Flores Bankr. W.D. Tex. Case No. 12-53780 Chapter 11 Petition filed December 4, 2012 In re Lionel Zapata Bankr. W.D. Tex. Case No. 12-70232 Chapter 11 Petition filed December 4, 2012 In re Ashoke Seth Bankr. D. Ariz. Case No. 12-25956 Chapter 11 Petition filed December 5, 2012 In re William Plunkett Bankr. W.D. Ark. Case No. 12-74505 Chapter 11 Petition filed December 5, 2012 In re George Zeber Bankr. C.D. Calif. Case No. 12-23828 Chapter 11 Petition filed December 5, 2012 In re Lawrence Dodge Bankr. C.D. Calif. Case No. 12-23845 Chapter 11 Petition filed December 5, 2012 In re Edward Meagher Bankr. N.D. Calif. Case No. 12-33418 Chapter 11 Petition filed December 5, 2012 In re Stephen Lin Bankr. N.D. Calif. Case No. 12-49651 Chapter 11 Petition filed December 5, 2012 In re Dawn Bearden Bankr. S.D. Fla. Case No. 12-39158 Chapter 11 Petition filed December 5, 2012 In re Naveed Food Corp. Bankr. S.D. Fla. Case No. 12-39196 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/flsb12-39196.pdf represented by: Craig I. Kelley, Esq. KELLEY & FULTON, PL E-mail: cik@kelleylawoffice.com In re Dhaka of Palm Beach, Inc. Bankr. S.D. Fla. Case No. 12-39197 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/flsb12-39197.pdf represented by: Craig I. Kelley, Esq. KELLEY & FULTON, PL E-mail: cik@kelleylawoffice.com In re MC Realty XXXIV, Inc. Bankr. N.D. Ill. Case No. 12-47937 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/ilnb12-47937.pdf represented by: Andrew J. Maxwell, Esq. MAXWELL LAW GROUP, LLC E-mail: maxwelllawchicago@yahoo.com In re Arthur Kapetansky Bankr. D. Nev. Case No. 12-23351 Chapter 11 Petition filed December 5, 2012 In re Craig Wasserman Bankr. D. Nev. Case No. 12-23373 Chapter 11 Petition filed December 5, 2012 In re Jose Vargas Bankr. D. Nev. Case No. 12-23379 Chapter 11 Petition filed December 5, 2012 In re The Famous Midtown Grill, Inc. Bankr. D. N.J. Case No. 12-38480 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/njb12-38480.pdf represented by: David L. Stevens, Esq. SCURA, MEALEY, WIGFIELD & HEYER LLP E-mail: dstevens@scuramealey.com In re Midtown Realty, LLC Bankr. D. N.J. Case No. 12-38481 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/njb12-38481.pdf represented by: David L. Stevens, Esq. SCURA, MEALEY, WIGFIELD & HEYER LLP E-mail: dstevens@scuramealey.com In re Fredrick Weinberg Bankr. D. N.J. Case No. 12-38503 Chapter 11 Petition filed December 5, 2012 In re Fredrick Weinberg Bankr. D. N.J. Case No. 12-38506 Chapter 11 Petition filed December 5, 2012 In re Raymond Garcia Bankr. D. N.M. Case No. 12-14431 Chapter 11 Petition filed December 5, 2012 In re Luis Figueroa Feliciano Bankr. D.P.R. Case No. 12-09614 Chapter 11 Petition filed December 5, 2012 In re Christ Revival Church Center, a non-profit Corporation aka Christ Church Revival Center Bankr. D. S.C. Case No. 12-07527 Chapter 11 Petition filed December 5, 2012 See http://bankrupt.com/misc/scb12-07527.pdf represented by: Felix B. Clayton, Esq. E-mail: butch@butchclaytonlaw.com In re John Stafford Bankr. N.D. Ala. Case No. 12-83885 Chapter 11 Petition filed December 6, 2012 In re Jeff Drum Bankr. E.D. Ark. Case No. 12-17058 Chapter 11 Petition filed December 6, 2012 In re Hansen Freightlines Incorporated Bankr. C.D. Calif. Case No. 12-50259 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/cacb12-50259.pdf represented by: David L. Neale, Esq. Levene Neale Bender Rankin & Brill LLP E-mail: dln@lnbrb.com In re Mario Hernandez Bankr. C.D. Calif. Case No. 12-50192 Chapter 11 Petition filed December 6, 2012 In re James Alan Wilson and Jan C. Wilson Bankr. S.D. Ga. Case No. 12-21398 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/gasb12-21398.pdf In re Derrick Bovino Bankr. N.D. Ill. Case No. 12-48031 Chapter 11 Petition filed December 6, 2012 In re Lee Coleman Bankr. W.D. Ky. Case No. 12-11630 Chapter 11 Petition filed December 6, 2012 In re Shopper's Warehouse, Inc. Bankr. W.D. Ky. Case No. 12-11629 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/kywb12-11629.pdf represented by: Mark H. Flener, Esq. E-mail: mark@flenerlaw.com In re Stephen Sewell Bankr. E.D. La. Case No. 12-13616 Chapter 11 Petition filed December 6, 2012 In re Harmony Entertainment Group, Inc. dba WOW Cafe & Wingery Bankr. D. Md. Case No. 12-31819 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/mdb12-31819p.pdf See http://bankrupt.com/misc/mdb12-31819c.pdf represented by: Marla L. Howell, Esq. DeCaro & Howell, P.C. E-mail: mhowell@decarohowell.com In re Robert Ragozine Bankr. D.N.J. Case No. 38614 Chapter 11 Petition filed December 6, 2012 In re Ballsville Land Company, LLC Bankr. D. Ore. Case No. 12-65165 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/orb12-65165.pdf represented by: Caroline Cantrell, Esq. M. Caroline Cantrell & Assoc. PC E-mail: wtibbetts@bankruptcyoregon.com In re Curtis DeJong Bankr. D. Ore. Case No. 12-65163 Chapter 11 Petition filed December 6, 2012 In re TechRadium, Inc. dba Utiligent dba Ministry Touch Communications dba CommandCore Bankr. S.D. Tex. Case No. 12-39103 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/txsb12-39103p.pdf See http://bankrupt.com/misc/txsb12-39103c.pdf represented by: Peter Johnson, Esq. Law Offices of Peter Johnson E-mail: pjlawecf@pjlaw.com In re Lehi Roller Mills Co., Inc. Bankr. D. Utah Case No. 12-35291 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/utb12-35291.pdf represented by: Jeffrey Q. Cardon, Esq. Hill, Johnson & Schmutz, LC E-mail: jcardon@hjslaw.com In re Competitive Edge Labs, LLC Bankr. W.D. Va. Case No. 12-62755 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/vawb12-62755.pdf represented by: Andrew S. Goldstein, Esq. Magee Goldstein Lasky & Sayers, P.C. E-mail: agoldstein@mglspc.com In re Dirk M Mayberry Inc. Bankr. W.D. Wash. Case No. 12-48238 Chapter 11 Petition filed December 6, 2012 See http://bankrupt.com/misc/wawb12-48238.pdf Filed pro se In re Maliheh Pehzuhesh Bankr. E.D. Calif. Case No. 12-41124 Chapter 11 Petition filed December 7, 2012 In re Antonio Teixeira Bankr. E.D. Calif. Case No. 12-60064 Chapter 11 Petition filed December 7, 2012 In re Carlos Porras Bankr. N.D. Calif. Case No. 12-58699 Chapter 11 Petition filed December 7, 2012 In re Cattlemen Energy Complex, LLC Bankr. M.D. Fla. Case No. 12-18434 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/flmb12-18434.pdf represented by: Timothy W. Gensmer, Esq. TIMOTHY W. GENSMER, P.A. E-mail: timgensmer@aol.com In re Donald Myers Bankr. N.D. Ind. Case No. 12-40840 Chapter 11 Petition filed December 7, 2012 In re Oceanic Inn, Inc. Bankr. D. Maine Case No. 12-21509 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/meb12-21509.pdf represented by: Joseph L. Goodman, Esq. THE GOODMAN LAW FIRM, P.A. E-mail: joe@goodmanlawfirm.com In re JNM Food Services, Inc. dba Jumper's Grille Bankr. D. Md. Case No. 12-31904 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/mdb12-31904.pdf represented by: Stephen J. Kleeman, Esq. LAW OFFICES OF STEPHEN J. KLEEMAN E-mail: barthelaw@aol.com In re Barlen Contrating, Inc. Bankr. E.D. Mich. Case No. 12-66638 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/mieb12-66638p.pdf See http://bankrupt.com/misc/mieb12-66638c.pdf represented by: William R. Orlow B.O.C. LAW GROUP, P.C. Email: bocecf@boclaw.com In re Dennis Gillespie Bankr. D. Nebr. Case No. 12-82756 Chapter 11 Petition filed December 7, 2012 In re Patrick Gilmore Bankr. D. Nev. Case No. 12-52752 Chapter 11 Petition filed December 7, 2012 In re Theresa Angiulli Bankr. D. N.J. Case No. 12-38667 Chapter 11 Petition filed December 7, 2012 In re Payless Contracting Corp. Bankr. S.D.N.Y. Case No. 12-14826 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/nysb12-14826.pdf represented by: Anne J. Penachio, Esq. PENACHIO MALARA LLP E-mail: apenachio@pmlawllp.com In re 202 Umbrella Inc. aka Umbrella Restaurant Lounge Bankr. S.D.N.Y. Case No. 12-14828 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/nysb12-14828.pdf Filed as Pro Se In re Bereshith Cultural Institute dba New Beginings Educational Inst. Bankr. S.D.N.Y. Case No. 12-24091 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/nysb12-24091.pdf represented by: Anne J. Penachio, Esq. PENACHIO MALARA LLP E-mail: apenachio@pmlawllp.com In re Norse Energy Holdings, Inc. Bankr. W.D.N.Y. Case No. 12-13695 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/nywb12-13695.pdf represented by: Janet G. Burhyte, Esq. GROSS, SHUMAN, BRIZDLE & GILFILLAN, P.C. E-mail: jburhyte@gross-shuman.com In re Infratech Industries, Inc. Bankr. W.D. Pa. Case No. 12-07006 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/pamb12-07006p.pdf See http://bankrupt.com/misc/pamb12-07006c.pdf represented by: Henry W. Van Eck, Esq. METTE, EVANS, & WOODSIDE E-mail: hwvaneck@mette.com In re 40 Castillo Inc. Bankr. D.P.R. Case No. 12-09670 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/prb12-09670.pdf represented by: Andres Garcia Arregui, Esq. GARCIA ARREGUI & FULLANA E-mail: garciarr@prtc.net In re Leslie Kennedy Bankr. E.D. Tenn. Case No. 12-34913 Chapter 11 Petition filed December 7, 2012 In re The County Line Management on Lake Conroe, LLC Bankr. S.D. Tex. Case No. 12-39122 Chapter 11 Petition filed December 7, 2012 See http://bankrupt.com/misc/txsb12-39122.pdf represented by: John Akard, Jr., Esq. JOHN AKARD JR. P.C. E-mail: johnakard@attorney-cpa.com ********* 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 ***