/raid1/www/Hosts/bankrupt/TCR_Public/121226.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, December 26, 2012, Vol. 16, No. 357
Headlines
11447 SECOND: Case Summary & 12 Largest Unsecured Creditors
A123 SYSTEMS: Dec. 27 Hearing to Approve DIP Loan Amendments
A123 SYSTEMS: Creditors Have Until Jan. 14 to File Proofs of Claim
ALCATEL-LUCENT: Moody's Rates Sr. Secured Credit Facilities (P)B1
ALLEN FAMILY: Committee Can Hire CohnReznick as Fin'l Advisor
ALLEN SYSTEMS: S&P Hikes Corp. Credit Rating to 'CCC'; Outlook Neg
ALLIANT HOLDINGS: S&P Rates $805-Mil. Secured Debt 'B-'
ALLY FINANCIAL: Deferred Interest Debentures Delisted From NYSE
ALTRA INDUSTRIAL: S&P Withdraws BB- Corp. Credit Rating on Request
AMEREN ENERGY: Moody's Reviews 'Ba3' Rating for Downgrade
AMF BOWLING: Court Approves March 18 Auction, Bid Protocol
AMIN ASSOCIATES: Case Summary & 8 Largest Unsecured Creditors
APPLETON PAPERS: Kent Willetts Quits as Senior Vice President
ARCAPITA BANK: Falcon Wants to Drag Tide, HSBC in Hopper Lawsuit
ARMORED AUTOGROUP: Moody's Cuts CFR/PDR to 'B3'; Outlook Stable
ATLANTIC BROADBAND: S&P Puts 'BB+' Rating on $710MM Debt on Watch
ATP OIL: Court Approves Amendment No. 2 to DIP Agreement
ATP OIL: Duff & Phelps Approved as Committee's Financial Advisor
ATP OIL: Epiq Approved as Committee's Information Agent
ATRIUM WINDOWS: Moody's Cuts CFR/PDR to 'Caa2'; Outlook Negative
BADGER HOLDING: S&P Withdraws 'B+' Corp. Credit Rating on Request
BENADA ALUMINUM: Can Hire Latham Shuker as Counsel
BENADA ALUMINUM: Committee Taps Deloitte Financial as Accountant
BIGLICK 254: Case Summary & 7 Largest Unsecured Creditors
BLUEGREEN CORP: Shareholders Elect 8 Directors to Board
BLYTH: Visalus Deal No Impact on Moody's 'B2' Corp. Family Rating
BRIDGEVIEW AEROSOL: Committee Can Hire Plante as Consultant
BROOKFIELD RESIDENTIAL: S&P Assigns B+ CCR, Rates $400MM Notes BB-
BUFFETS INC: Names Philip Friedman & Warren Ellish to Board
CDW LLC: S&P Raises Secured Debt Rating to 'B+'; Outlook Stable
CENTENNIAL BEVERAGE: Case Summary & 31 Largest Unsecured Creditors
CHURCH STREET: Plan to Establish Liquidating Trust
CIRCLE STAR: Incurs $5.9-Mil. Net Loss in October 31 Quarter
CLEAR CHANNEL: Bank Debt Trades at 17% Off in Secondary Market
COGECO CABLE: S&P Puts 'BB+' CCR on Watch on Peer 1 Purchase Pact
COMMUNITY FINANCIAL: May Issue Up to 75 Million Common Shares
COMMUNITY WEST: Treasury Sells 15,600 Series A Preferred Shares
CORAL POINT: Case Summary & Largest Unsecured Creditor
CREATIVE VISTAS: Suspends Filing of SEC Reports
D MEDICAL: Receives $1.48 Million Default Notice From Supplier
DAFFY'S INC: Plan Confirmation Hearing Adjourned to Feb. 20
DBI HOUSING: Case Summary & 18 Largest Unsecured Creditors
DEEP PHOTONICS: Plan Filing Exclusivity Extended to April 12
DEMCO INC: Court Extends Exclusive Plan Filing Period to April 5
DEWEY & LEBOEUF: Has Access to Cash Collateral Until February 3
DISH DBS: Fitch Rates Senior Unsecured Notes 'BB-'; Outlook Neg.
EDISON MISSION: Taps Kirkland & Ellis as Lead Counsel
EDISON MISSION: Wins OK for GCG Inc. as Claims Agent
EDISON MISSION: Proposes McDonald Hopkins as Conflicts Counsel
EDISON MISSION: Hiring Perella Weinberg as Investment Banker
EDISON MISSION: Wins Approval to Honor PoJo Forbearance Pact
EDKEY INC: S&P Rates $44MM Series 2012 Revenue Bonds 'BB+'
EINSTEIN NOAH: Moody's Withdraws 'B3' Corporate Family Rating
EQT CORP: Moody's Reviews '(P)Ba2' Preferred Shelf Rating
FIRST WIND: S&P Affirms 'B-' Corp. Credit Rating; Outlook Stable
FPL ENERGY: Fitch Lowers Rating on $365-Mil. Debt to 'BB'
FREESEAS INC: Gets Nasdaq Delisting Notice
GATEHOUSE MEDIA: Bank Debt Trades at 64% Off in Secondary Market
GEOKINETICS INC: Receives Delisting Notice From NYSE MKT
GEOMET INC: Bank Lenders Keep $115 Million Commitment
GFI GROUP: S&P Lowers Issuer Credit Rating to 'BB-'; Outlook Neg
GLOBALSTAR INC: Delisted From NASDAQ Stock Market
GRANITE DELLS: Debtor, Tri-City Refrain From Soliciting Plan Votes
GRANITE DELLS: Jan. 15 Set as Deadline for 2012 Admin. Claims
HAYDEL PROPERTIES: Taps Kenneth Jones as Real Estate Broker
HOLLIFIELD RANCHES: Has Nod to Hire Richard Martella as Auctioneer
HOTELS USA: Case Summary & 15 Largest Unsecured Creditors
HOUSE OF RHEMA: Case Summary & Largest Unsecured Creditor
HUNTER FAN: S&P Raises Ratings on $125MM Secured Credit to 'B+'
IAP WORLDWIDE: S&P Raises Corporate Credit Rating to 'CCC+'
INTELLICEL BIOSCIENCES: Raises $250,000 From Securities Sale
INTERLINE BRANDS: S&P Revises Outlook on 'B+' CCR to Negative
INTERNET SPECIALTIES: Case Summary & 20 Top Unsecured Creditors
INVESTORS CAPITAL: Files for Chapter 11 in Kentucky
INVESTORS CAPITAL: Case Summary & 9 Largest Unsecured Creditors
J CREW GROUP: Moody's Says Special Dividend Credit Negative
JOLIET CROSSINGS: Case Summary & 10 Largest Unsecured Creditors
JOURNAL REGISTER: Court Approves February Auction, Bid Protocol
KURB PROPERTIES: Case Summary & 6 Largest Unsecured Creditors
LANGUAGE LINE: Moody's Cuts CFR/PDR to 'B2'; Outlook Stable
LIBERTY HARBOR: Has Until Jan. 15 to File Chapter 11 Plan
MEDYTOX SOLUTIONS: Borrows Add'l $650,000 From TCA Global
MERCER INTERNATIONAL: Moody's Affirms 'B2' Corp. Family Rating
METROPOLITAN HEALTH: S&P Ups Counterparty Credit Rating From 'B+'
MICHIGAN STATE HOSP: Fitch Affirm 'BB+' Rating on $30.68MM Bonds
MILLION AIR: Moody's Cuts Revenue Bond Rating to 'B1'
NEEBO INC: S&P Assigns 'CCC+' Corporate Credit Rating
NEWPAGE CORP: Emerges From Bankruptcy; Closes $850MM Exit Loan
NEWPAGE CORP: AlixPartners, Goldman Directors Named to Board
NEW YORK SPOT: Voluntary Chapter 11 Case Summary
NORTHSTAR AEROSPACE: PwC Canada Approved as Expert Witness
NUVILEX INC: Delays Form 10-Q Report for Oct. 31 Quarter
ORIENTAL FINANCIAL: S&P Keeps 'BB+' Counterparty Credit Rating
PEAK RESORTS: Wants to Hire Bonadio & Co as Accountant
PHIL'S CAKE: Has OK to Hire Baumann Raymondo to Audit 401(k) Plan
PHIL'S CAKE: Wants to Hire Rick Fernandez as Property Manager
PHOENIX LIFE: S&P Cuts Rating on Outstanding Surplus Notes to 'B-'
PINNACLE AIRLINES: DIP Lender Extends Sec. 1113 Deadline to Jan 17
PINNACLE ENTERTAINMENT: S&P Puts BB- Corp. Credit Rating on Watch
PRESSURE BIOSCIENCES: Stockholders Elect 2 Directors to Board
PRESTIGE BRANDS: S&P Revises Outlook on 'B+' CCR to Stable
PTC ALLIANCE: Moody's Reinstates 'B2' Corp. Family Rating
PYRAMID CONNECTION: Case Summary & Largest Unsecured Creditor
QUEENS BALLPARK: S&P Lowers Rating on $547MM PILOT Bonds to 'BB'
RADIO ONE: S&P Alters Outlook on 'B-' Corp Credit Rating to Stable
RAINBRIDGE LLC: Case Summary & 20 Largest Unsecured Creditors
REHOBOTH MCKINLEY: Fitch Affirms Rating on 2007A Bonds at 'B'
RESIDENTIAL CAPITAL: S&P Withdraws 'D' Corporate Credit Rating
RWW GROUP: Case Summary & 11 Largest Unsecured Creditors
SANDRIDGE ENERGY: S&P Puts 'B' Rating on $4.3BB Notes on Watch
SANTEON GROUP: Adopts 2012 Employee Incentive Stock Option Plan
SENSATA TECHNOLOGIES: S&P Ups CCR to 'BB' on Reduced Bain Stake
SIERRA KINGS: S&P Raises Rating on Series 2002 GO Bonds From 'C'
SMART ONLINE: Sells Additional $275,000 Convertible Note
SMOKY HILL: Case Summary & 6 Largest Unsecured Creditors
SNOHOMISH COUNTY PHD: Fitch Affirms 'B' Rating on $2.9-Mil. Bonds
SPX CORP: Fitch Affirms 'BB+' Issuer Default Rating; Outlook Neg.
STABLEWOOD SPRINGS: Case Summary & 19 Largest Unsecured Creditors
STANDARD PACIFIC: Fitch Raises Issuer Default Rating to 'B'
STOCKTON PUBLIC: Fitch Keeps 'BB' Ratings on Watch Negative
SUGAR CREEK, MO: Moody's Lifts Revenue Bond Rating From Ba1
TALON THERAPEUTICS: To Issue Add'l 400,000 Shares Under Plan
TEMPEL STEEL: Moody's Cuts CFR/PDR to 'Caa1'; Outlook Negative
THQ INC: Wins Approval for KCC as Claims and Notice Agent
THQ INC: Proposes $427,000 Non-Insider Key Employee Retention Plan
THQ INC: Wins Approval to Pay Critical Vendors
THQ INC: WWE Responds to Bankruptcy Filing
TOYS 'R' US: Fitch Lowers Issuer Default Rating to 'B-'
TPC GROUP: S&P Assigns 'B' Corp. Credit Rating Following LBO
TRIBUNE CO: Bank Debt Trades at 17% Off in Secondary Market
TRIMJOIST CORP: Case Summary & 20 Largest Unsecured Creditors
TXU CORP: Bank Debt Trades at 33% Off in Secondary Market
TXU CORP: Bank Debt Trades at 26% Off in Secondary Market
UNITED DISTRIBUTION: S&P Assigns 'B-' Corp. Credit Rating
US AIRWAYS: S&P Revises Outlook on 'B-' CCR on Financial Profile
USI INC: S&P Gives 'B-' Counterparty Credit Rating
VELATEL GLOBAL: Secures $12 Million Funding From Ironridge
VERTIS HOLDINGS: Jan. 30 Fixed as General Claims Bar Date
VHGI HOLDINGS: Incurs $1.3 Million Net Loss in Third Quarter
VISCOUNT SYSTEMS: Bhatia Family Discloses 8.4% Equity Stake
VISCOUNT SYSTEMS: Tamino Capital Discloses 8.4% Equity Stake
VITERRA INC: Moody's Raises Debt Ratings From 'Ba1'
WP EVENFLO: Moody's Raises CFR/PDR to 'B3'; Outlook Stable
XZERES CORP: David Baker Resigns From Board of Directors
YELLOW MEDIA: S&P Cuts CCR to 'D' on Debt Recapitalization
* Fitch Says Credit Outlook of Restaurant Industry Remains Stable
* Fitch Projects US High Yield Default Rate to Persist Into 2013
* Moody's Says Number of Low-Rated US Companies Hits New Low
* Moody's Comments on Canada's New Covered Bond Guidelines
* Upcoming Meetings, Conferences and Seminars
*********
11447 SECOND: Case Summary & 12 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: 11447 Second Street I, LLC
P.O. Box 1393
Madison, WI 53701
Bankruptcy Case No.: 12-84690
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Northern District of Illinois (Rockford)
Judge: Manuel Barbosa
Debtor's Counsel: Jeffrey C. Dan, Esq.
CRANE HEYMAN SIMON WELCH & CLAR
135 S. Lasalle St., Ste. 3705
Chicago, IL 60603
Tel: (312) 641-6777
Fax: (312) 641-7114
E-mail: jdan@craneheyman.com
Scheduled Assets: $123,124
Scheduled Liabilities: $2,239,927
A list of the Company's 12 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/ilnb12-84690.pdf
The petition was signed by Gregg Raupp, member.
Six affiliates that sought Chapter 11 protection on the same date
are:
Debtor Case No.
------ --------
11447 Second Street II, LLC 12-84691
11447 Second Street IV, LLC 12-84692
11447 Second Street V, LLC 12-84694
11447 Second Street VI, LLC 12-84695
11447 Second Street VIII, LLC 12-84696
11447 Second Street IX, LLC 12-84698
A123 SYSTEMS: Dec. 27 Hearing to Approve DIP Loan Amendments
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware will
convene a hearing on Dec. 27, 2012, at 3:30 p.m., to consider A123
Systems, Inc.'s request for authorization to enter into Amendment
No. 1 to the Debtor-in-Possession Loan Agreement between the
Debtor and Wanxiang America Corporation, as the initial lender,
dated as of Nov. 5, 2012, as amended.
Wanxiang obtained Court approval to buy A123's assets at an
auction earlier this month, beating out Johnson Controls Inc.,
which acted as the stalking horse bidder. According to reports,
the deal with JCI was valued at $125 million. Wanxiang topped
that bid with a $256.6 million offer.
The DIP amendment prevents the expiration of the loan agreement
prior to the consummation of the sale.
According to the parties, the sale will not be consummated prior
to the maturity date under the loan agreement, which has an
outside date of Dec. 31. Although the Debtors expect the
consummation of the sale transaction with Wanxiang to occur by
Jan. 15, 2013, consummation of the sale transaction could occur at
any time prior to March 31, 2013, depending on when the closing
conditions set forth in the Purchase Agreement are satisfied.
The Amendment No. 1 provides for, among other things:
-- the extension of the Dec. 31, 2012, maturity date
to March 31, 2013; and
-- the removal of a potential barrier to consummation of
the sale to Wanxiang by extending, without charge,
the maturity date of the loan agreement.
As set forth on the record at the hearing held Dec. 11, the
purchase agreement will result in a considerable return to the
Debtors' estates. The purchase price is approximately
$256.6 million, which is more than twice the purchase price
contemplated by the stalking horse purchase agreement.
Additionally, Wanxiang, or its designee, assumes significant
liabilities under the terms of the purchase agreement, including
the payment of all cure costs associated with the transfer of
contracts to Wanxiang.
A copy of the Amendment No. 1 is available for free at
http://bankrupt.com/misc/ATPOIL_dipcreditagreement_order.pdf
About A123 Systems
Based in Waltham, Massachusetts, A123 Systems Inc. designs,
develops, manufactures and sells advanced rechargeable lithium-ion
batteries and battery systems and provides research and
development services to government agencies and commercial
customers.
A123 is the recipient of a $249 million federal grant from the
Obama administration. Pre-bankruptcy, A123 had an agreement to
sell an 80% stake to Chinese auto-parts maker Wanxiang Group Corp.
U.S. lawmakers opposed the deal over concerns on the transfer of
American taxpayer dollars and technology to China.
A123 didn't make a $2.7 million payment due Oct. 15 on $143.75
million in 3.75% convertible subordinated notes due 2016.
A123 and U.S. affiliates, A123 Securities Corporation and Grid
Storage Holdings LLC, sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Case Nos. 12-12859 to 12-12861) on Oct. 16, 2012.
A123 disclosed assets of $459.8 million and liabilities totaling
$376 million. Debt includes $143.8 million on 3.75% convertible
subordinated notes. Other liabilities include $22.5 million on a
bridge loan owing to Wanziang. About $33 million is owed to trade
suppliers.
The Hon. Kevin J. Carey presides over the case. Lawyers at
Richards, Layton & Finger, P.A., and Latham & Watkins LLP serve as
the Debtors' counsel. Lazard Freres & Co. LLC acts as the
Debtors' financial advisors, while Alvarez & Marsal serves as
restructuring advisors. Logan & Company Inc. serves as the
Debtors' claims and noticing agent. Wanxiang America Corporation
and Wanxiang Clean Energy USA Corp. are represented in the case by
lawyers at Young Conaway Stargatt & Taylor, LLP, and Sidley Austin
LLP. JCI is represented in the case by Josh Feltman, Esq., at
Wachtell Lipton Rosen & Katz LLP.
An official committee of unsecured creditors has been appointed in
the case. The Committee is represented by lawyers at Brown
Rudnick LLP and Saul Ewing LLP.
A123 sought bankruptcy protection with a deal to sell its auto-
business assets to Johnson Controls Inc. The deal with JCI is
valued at $125 million, and subject to higher offers at a
bankruptcy auction. At an auction early in December, JCI's bid
was topped by Wanxiang America's $256.6 million offer.
The Bankruptcy Court approved the sale on Dec. 11. Wanxiang is
buying most of A123, except for its government business. Navitas
Systems, a Chicago-area company spun off from Sun MicroSystems, is
buying A123's government business for $2.25 million.
JCI has filed an appeal from the sale approval.
A123 SYSTEMS: Creditors Have Until Jan. 14 to File Proofs of Claim
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware established
Jan. 14, 2013 at 5:00 p.m., as the deadline for any individual or
entity to file proofs of claim against A123 Systems, Inc., et al.
The Court also set April 15, at 5 p.m., as the governmental unit
bar date.
Proofs of claim must be submitted to:
A123 Systems, Inc.
Claims Docketing Department
c/o Logan & Company, Inc.
546 Valley Road
Upper Montclair, NJ 07043
About A123 Systems
Based in Waltham, Massachusetts, A123 Systems Inc. designs,
develops, manufactures and sells advanced rechargeable lithium-ion
batteries and battery systems and provides research and
development services to government agencies and commercial
customers.
A123 is the recipient of a $249 million federal grant from the
Obama administration. Pre-bankruptcy, A123 had an agreement to
sell an 80% stake to Chinese auto-parts maker Wanxiang Group Corp.
U.S. lawmakers opposed the deal over concerns on the transfer of
American taxpayer dollars and technology to China.
A123 didn't make a $2.7 million payment due Oct. 15 on $143.75
million in 3.75% convertible subordinated notes due 2016.
A123 and U.S. affiliates, A123 Securities Corporation and Grid
Storage Holdings LLC, sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Case Nos. 12-12859 to 12-12861) on Oct. 16, 2012.
A123 disclosed assets of $459.8 million and liabilities totaling
$376 million. Debt includes $143.8 million on 3.75% convertible
subordinated notes. Other liabilities include $22.5 million on a
bridge loan owing to Wanziang. About $33 million is owed to trade
suppliers.
The Hon. Kevin J. Carey presides over the case. Lawyers at
Richards, Layton & Finger, P.A., and Latham & Watkins LLP serve as
the Debtors' counsel. Lazard Freres & Co. LLC acts as the
Debtors' financial advisors, while Alvarez & Marsal serves as
restructuring advisors. Logan & Company Inc. serves as the
Debtors' claims and noticing agent. Wanxiang America Corporation
and Wanxiang Clean Energy USA Corp. are represented in the case by
lawyers at Young Conaway Stargatt & Taylor, LLP, and Sidley Austin
LLP. JCI is represented in the case by Josh Feltman, Esq., at
Wachtell Lipton Rosen & Katz LLP.
An official committee of unsecured creditors has been appointed in
the case. The Committee is represented by lawyers at Brown
Rudnick LLP and Saul Ewing LLP.
A123 sought bankruptcy protection with a deal to sell its auto-
business assets to Johnson Controls Inc. The deal with JCI is
valued at $125 million, and subject to higher offers at a
bankruptcy auction. At an auction early in December, JCI's bid
was topped by Wanxiang America's $256.6 million offer.
The Bankruptcy Court approved the sale on Dec. 11. Wanxiang is
buying most of A123, except for its government business. Navitas
Systems, a Chicago-area company spun off from Sun MicroSystems, is
buying A123's government business for $2.25 million.
JCI has filed an appeal from the sale approval.
ALCATEL-LUCENT: Moody's Rates Sr. Secured Credit Facilities (P)B1
-----------------------------------------------------------------
Moody's Investors Service has assigned a provisional (P)B1 rating
to the proposed EUR1.615 billion senior secured guaranteed credit
facilities to be raised by Alcatel-Lucent USA Inc., an Alcatel-
Lucent subsidiary, to refinance in part the group's senior
unsecured notes and convertible bonds.
Moody's has also affirmed Alcatel-Lucent's corporate family rating
(CFR) and probability of default rating (PDR) at B3. Concurrently,
Moody's has affirmed the ratings on the existing senior unsecured
instruments issued by Alcatel-Lucent and its subsidiaries at Caa1
and the ratings on two convertible bonds issued by Lucent
Technologies, Inc., before its 2006 merger with Alcatel, and
guaranteed by Alcatel-Lucent on a subordinated basis at Caa2.
The outlook on all ratings remains negative.
Ratings Rationale
The (P)B1 rating on the proposed senior secured guaranteed notes
reflects (1) the priority position of the loans within the capital
structure of the Alcatel-Lucent group; (2) the benefits of the
security, consisting predominantly of part of Alcatel-Lucent's
intellectual property portfolio, and (3) a guarantee package
provided by the key holding companies and operating companies of
the group, initially representing at least 43% of consolidated
sales for the first nine months of 2012 and 159% of consolidated
EBITDA and 53% of consolidated assets as per the last twelve
months ended September 30, 2012.
The new transaction is intended to allow Alcatel-Lucent to raise a
$500 million asset sale facility and $1.275 billion and EUR250
million senior secured term loans. Proceeds from the financing
will be used to refinance (through a public tender or open market
purchases or at maturity) near-term maturities and for general
corporate purposes. The announced transaction is fully
underwritten and will allow the company to extend the maturity
profile of its debt, thus gaining flexibility to implement its
previously announced EUR1.25 billion cost reduction measures and
the exiting or restructuring of unprofitable managed services
contracts and geographic markets. The existing unsecured
revolving credit facility will be terminated in connection with
the transaction.
Alcatel-Lucent USA, Inc., an Alcatel-Lucent subsidiary, will be
the borrower under the facilities whilst Alcatel-Lucent and some
of its material subsidiaries will be guarantors. The senior
secured credit facilities are expected to be denominated in US
dollars and in euros, with maturities of between three-and-a-half
and six years.
Provisional ratings reflect Moody's preliminary credit opinion
regarding the transaction only. Moody's will aim to assign a
definitive rating following a review of the final details of the
transaction. A definitive rating may differ from a provisional
rating.
Rationale For Affirmation
Although Moody's considers the new debt issuance to be credit-
positive for Alcatel-Lucent, the rating agency's decision to
affirm the B3 CFR and PDR with a negative outlook was driven by
the continued uncertainty about the company's ability to
significantly reduce its free cash outflows in 2013 and move
towards break-even thereafter. However, the refinancing buys the
company time and gives it additional room for underperformance
within the B3 rating category.
The envisaged transaction is credit negative for the existing
senior debt of Alcatel Lucent as it significantly reduces the
value of assets available for repayment of that debt in case of a
default of Alcatel Lucent. However, Moody's decision to affirm
Alcatel-Lucent's senior debt ratings at Caa1 as well as the
ratings on two convertible bonds issued by Lucent Technologies,
Inc. at Caa2 reflects the fact that these ratings are already
notched below the CFR and that the expected recovery values
implied at current rating levels, although lower than without the
transaction, have already been low.
Alcatel-Lucent USA, Inc. is both an operating and intermediate
holding company primarily for the US operations of the group,
owing around half of the group's debt. Customers located in USA
account for approximately one third of Alcatel-Lucent's group
sales. In its loss given default approach, Moody's has aligned the
recovery rankings for the senior unsecured debt of Alcatel-Lucent
and of Alcatel-Lucent USA, Inc. because the USA business is fully
integrated and strategically very important to the group. As such,
any potential financial restructuring is likely to treat the two
borrowers similarly, with comparable recovery rates. Although
Alcatel-Lucent USA, Inc. is closer to part of the group's
operating cash flows, it currently also carries approximately half
of the group's debt whilst Alcatel-Lucent S.A. holds the majority
of the group's cash and marketable securities.
WHAT COULD CHANGE THE RATINGS DOWN/UP
Negative pressure on the B3 rating would increase if (1) the
company's operating margin, as adjusted by Alcatel-Lucent, fails
to trend towards the mid-single-digits in percentage terms in
2013, with further tangible improvements thereafter; (2) Alcatel-
Lucent fails to maintain its negative free cash flow below EUR500
million on a last 12 month basis throughout 2013, as adjusted by
Moody's; (3) the company's debt/EBITDA fails to improve towards
6.0x as adjusted by Moody's; or (4) the company fails to improve
its liquidity position through asset disposals and/or refinancing
well ahead of its debt maturities in 2013-14. Rating pressure
could ease and the outlook on the rating stabilize if all the
above conditions are met, with particular regard to an improvement
in free cash flow generation.
Although currently unlikely, upward rating pressure would require
Alcatel-Lucent to (1) generate significant positive free cash flow
on a last-12-months basis, as adjusted by Moody's; (2) sustain
sales growth; and (3) achieve an operating margin, as adjusted by
Alcatel-Lucent, in the mid-single digits in percentage terms.
The principal methodology used in rating Alcatel-Lucent USA Inc.
and Alcatel-Lucent was the Global Communications Equipment
Industry Methodology published in June 2008. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in June
2009.
ALLEN FAMILY: Committee Can Hire CohnReznick as Fin'l Advisor
-------------------------------------------------------------
The Official Committee of Unsecured Creditors of Allen Family
Foods, Inc., et al., sought and obtained permission from the Hon.
Kevin J. Carey of the U.S. Bankruptcy Court for the District of
Delaware to retain CohnReznick LLP as financial advisor, effective
as of Oct. 10, 2012.
CohnReznick will, among other things:
a) analyze and review key motions to identify strategic case
issues;
b) review proofs of claims and assist in the claims
reconciliation process;
c) assist in the confirmation of the joint Chapter 11 plan
of liquidation and consummation of same;
d) identify and quantify any recoverable assets which are
not in the Debtors' estate; and
e) render assistance as the Committee and its counsel may
deem necessary.
CohnReznick will be paid at these hourly rates:
Partners/Senior Partners $580-$790
Director/Senior Manager/Mgr. $430-$610
Other Professional Staff $270-$400
Paraprofessional $180
The Committee selected CohnReznick because of the firm's
considerable experience in insolvency matters and institutional
knowledge of these Chapter 11 proceedings to continue the work its
predecessor firm J.H. Cohn LLP performed in these Chapter 11
cases. The services to be rendered by CohnReznick are necessary
and essential to the performance of the Committee's duties and
obligations, and will not duplicate the services to be rendered by
any other professionals in this case. The services rendered by
CohnReznick are being performed by the same team as the
predecessor firm of J. H. Cohn LLP and are necessary to implement
and consummate the Plan and bring these Chapter 11 cases to
conclusion.
Howard L. Konicov, a partner at CohnReznick, attested to the Court
that the firm is a "disinterested person" as that term is defined
in Section 101(14) of the Bankruptcy Code.
About Allen Family Foods
Allen Family Foods Inc. is a 92-year-old Seaford, Del., poultry
company. Allen Family Foods and two affiliates, Allen's Hatchery
Inc. and JCR Enterprises Inc., filed for Chapter 11 bankruptcy
protection (Bankr. D. Del. Case No. 11-11764) on June 9, 2011.
Allen estimated assets and liabilities between $50 million and
$100 million in its petition.
Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young,
Conaway, Stargatt & Taylor, in Wilmington, Delaware, serve as
counsel to the Debtors. FTI Consulting is the financial advisor.
BMO Capital Markets is the Debtors' investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Roberta DeAngelis, U.S. Trustee for Region 3, appointed seven
creditors to serve on an Official Committee of Unsecured Creditors
in the Debtors' cases. Lowenstein Sandler PC and Womble Carlyle
Sandridge & Rice, PLLC, serve as counsel for the committee. J.H.
Cohn LLP serves as the Committee's financial advisor.
Allen Family Foods Inc. and the Committee of Unsecured Creditors
has filed a disclosure statement in support of its first amended
joint Chapter 11 plan of liquidation.
The Bankruptcy Court has scheduled the Confirmation Hearing for
Dec. 19, 2012, at 1:00 p.m. (prevailing Eastern Time).
The purpose of the Plan is to liquidate, collect and maximize the
cash value of the remaining assets of the Debtors and make
distributions in respect of any Allowed Claims against the
Debtors' Estates. The Plan is premised on the satisfaction of
Claims through creation of the Liquidating Trust (pursuant to the
Liquidating Trust Agreement) and distribution of the proceeds
raised from the sale and liquidation of the Debtors' remaining
assets, claims and Causes of Action.
ALLEN SYSTEMS: S&P Hikes Corp. Credit Rating to 'CCC'; Outlook Neg
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Allen Systems Group Inc. to 'CCC' from 'D'. The outlook
is negative.
"At the same time, we raised the issue-level rating on Allen's
$300 million secured second-lien notes to 'CCC-' from 'D'. The
recovery rating on the notes is unchanged at '5', reflecting our
expectation for modest recovery (10% to 30%) in the event of a
payment default," S&P said.
"The rating action follows Allen's repayment of the missed
interest on its $300 million secured second-lien notes due 2016,
which was due on Nov. 15, 2012. In addition, on Dec. 14, 2012, the
company entered into a term loan and a revolving credit facility
(both unrated) with TPG Opportunities Partners and used the
proceeds to repay its existing first-lien debt. Prior to the
refinancing, the company hadn't been in compliance with its total
leverage, fixed-charge coverage, and minimum liquidity covenants
under the first-lien debt," S&P said.
"The negative outlook reflects the company's ongoing weak
liquidity position and highly leveraged balance sheet," S&P said.
"We would consider a negative rating action if the company's
liquidity position deteriorates further due to worse-than-expected
operating trends. A revision of the outlook to stable would
require an improvement in the company's liquidity, which can
result from improved operations or potential further financings,"
said Standard & Poor's credit analyst Katarzyna Nolan.
ALLIANT HOLDINGS: S&P Rates $805-Mil. Secured Debt 'B-'
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' debt and '3'
recovery ratings (indicating our expectation for meaningful [50%-
70%] recovery of principal in the event of a default) to Alliant
Holdings I LLC (Alliant LLC)'s senior secured facilities
consisting of a $705 million term loan B due 2019, and $100
million revolving credit facility (undrawn at closing) due 2017.
"We also assigned our 'CCC' debt and '6' recovery ratings
(indicating our expectation for negligible [0%-10%] recovery of
principal in the event of a default) to the company's $450 million
senior unsecured notes due 2020," S&P said.
"We assigned these ratings following Alliant LLC's announcement
that it has completed its transaction to be purchased by private
equity firm Kohlberg Kravis Roberts & Co. LP (KKR) through a
leveraged buyout deal. KKR is using the proceeds from the term
loan and unsecured notes issued by Alliant LLC, along with its own
equity contribution, to acquire Alliant LLC," S&P said.
"At the same time, we are withdrawing all ratings on Alliant
Holdings I Inc. (Alliant Inc.) -- the issuer of debt before the
refinancing -- as this debt has been repaid as part of the
transaction," S&P said.
"The ratings reflect our belief that the company's credit metrics
will deteriorate following the recapitalization. The new capital
structure will result in a higher debt level of $1.155 billion
($705 million term loan B and $450 million unsecured notes)
immediately following the transaction, compared with $823 million
($558 million term loan and $265 unsecured note) as of Sept. 30,
2012. As a result of the increased debt load, the company's debt-
to-adjusted EBITDA ratio will weaken to 7.7x for pro-forma 2012
from 5.4x as of Sept. 30, 2012, and falls below our expectation
for the company to maintain financial leverage at 6.5x or less.
Similarly, EBITDA fixed-charge coverage weakens to 2.0x for pro-
forma 2012 from 2.3x for the 12 months ended Sept. 30, 2012," S&P
said.
RATINGS LIST
Alliant Holdings I LLC
Counterparty Credit Rating B-/Stable/--
New Rating
$705 Mil. Term Loan B Due 2019
$100 Mil. Revolver Due 2017
Senior Secured Debt B-
Recovery Rating 3
$450 Mil. Notes Due 2020
Senior Unsecured Debt CCC
Recovery Rating 6
Ratings Withdrawn To From
Alliant Holdings I Inc.
Counterparty Credit Rating NR B-/Stable/--
Senior Secured NR B
Recovery Rating NR 2
Senior Unsecured NR CCC
Recovery Rating NR 6
ALLY FINANCIAL: Deferred Interest Debentures Delisted From NYSE
---------------------------------------------------------------
The New York Stock Exchange LLC filed a Form 25 with the U.S.
Securities and Exchange Commission relating to the removal from
listing of Ally Financial Inc.'s Deferred Interest Debentures due
Dec. 1, 2012.
Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/--
is one of the world's largest automotive financial services
companies. The company offers a full suite of automotive
financing products and services in key markets around the world.
Ally's other business units include mortgage operations and
commercial finance, and the company's subsidiary, Ally Bank,
offers online retail banking products. Ally operates as a bank
holding company.
GMAC obtained a $17 billion bailout from the U.S. government in
exchange for a 56.3% stake. Private equity firm Cerberus Capital
Management LP keeps 14.9%, while General Motors Co. owns 6.7%.
Ally reported a net loss of $157 million in 2011, compared with
net income of $1.07 billion in 2010. Net income was $310 million
for the three months ended March 31, 2012.
The Company's balance sheet at Sept. 30, 2012, showed $182.48
billion in total assets, $163.71 billion in total liabilities and
$18.76 billion in total equity.
* * *
In February 2012, Fitch Ratings downgraded the long-term Issuer
Default Rating (IDR) and the senior unsecured debt rating of Ally
Financial and its subsidiaries to 'BB-' from 'BB'. The Rating
Outlook is Negative. The downgrade primarily reflects
deteriorating operating trends in ResCap, which has continued to
be a drag on Ally's consolidated credit profile, as well as
exposure to contingent mortgage-related rep and warranty and
litigation issues tied to ResCap, which could potentially impact
Ally's capital and liquidity levels.
As reported by the Troubled Company Reporter on May 22, 2012,
Standard & Poor's Ratings Services revised its outlook on Ally
Financial Inc. to positive from stable. At the same time,
Standard & Poor's affirmed its ratings, including its 'B+' long-
term counterparty credit and 'C' short-term ratings, on Ally.
"The outlook revision reflects our view of potentially favorable
implications for Ally's credit profile arising from measures the
company announced May 14, 2012, designed to resolve issues
relating to Residential Capital LLC, Ally's troubled mortgage
subsidiary," said Standard & Poor's credit analyst Tom Connell.
In the May 28, 2012 edition of the TCR, DBRS, Inc., has placed the
ratings of Ally and certain related subsidiaries, including its
Issuer and Long-Term Debt rating of BB (low), Under Review
Developing. This rating action follows the decision by Ally's
wholly owned mortgage subsidiary, Residential Capital to file a
pre-packaged bankruptcy plan under Chapter 11 of the U.S.
Bankruptcy Code.
ALTRA INDUSTRIAL: S&P Withdraws BB- Corp. Credit Rating on Request
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit on
AmerenEnergy Generating Co. to 'B-' from 'B'. "We also lowered the
ratings on GenCo's senior unsecured debt to 'B' from 'B+',
reflecting a '2' recovery rating, which indicates our expectation
of substantial (70%-90%) recovery in the event of a payment
default. The outlook is stable," S&P said.
"The downgrade on AmerenEnergy Generating Co. reflects its stand-
alone credit quality, including its 'highly leveraged' financial
risk profile and 'weak' business risk profile. Our view of GenCo
is based on its stand-alone credit quality with no parental
support. This reflects Ameren Corp.'s recent 8-K disclosure that
it is determined to exit the merchant generation business and to
ultimately eliminate GenCo's reliance on its financial and shared
services support," S&P said.
"The stable outlook incorporates our base-case scenario that
GenCo's profit margins will remain pressured because of low
electricity market prices and the expiration of a higher hedged
position. We also assume that because of Ameren's decision to exit
the merchant business, GenCo will be sold or restructured within
the next five years," S&P said.
"Under our base-case scenario, the company's financial measures
will weaken so that FFO to debt will be less than 7% and debt to
EBITDA will be more than 10x. We would lower the ratings if our
assessment of the company's strong liquidity weakens to less than
adequate or if FFO to debt is less than 4%. Although we currently
view an upgrade as highly unlikely given Ameren's recent
disclosure, the ratings could be raised if the company's FFO to
debt were to be consistently greater than 12%," said Standard &
Poor's credit analyst Gabe Grosberg.
AMEREN ENERGY: Moody's Reviews 'Ba3' Rating for Downgrade
---------------------------------------------------------
Moody's Investors Service placed Ameren Energy Generating
Company's (Ameren Genco; Ba3/negative) ratings under review for
downgrade. The action is precipitated by Ameren Corporation's
(Ameren Baa3/stable) announcement earlier on Dec. 20 that its
merchant generation segment is no longer core to its business
strategy and that it will reduce, and ultimately eliminate over
time, financial and shared services support to this business
segment.
Ratings Rationale
"Moody's senior unsecured rating of Ba3 on Ameren Genco has been
predicated on Ameren's continued tangible financial support for
this entity" said Toby Shea, Senior Analyst. "The reduction and
eventual elimination of parent company support will limit Ameren
Genco's financial flexibility at a time when continued low power
prices and ongoing environmental compliance requirements
persists," added Mr. Shea.
The review will focus on the impact to Ameren Genco finances and
operations of this revised strategic direction. In particular,
Moody's will examine the pace of the withdrawal of parent company
credit support for Ameren Genco's trading activities and the
consequences on Ameren Genco's liquidity and hedging activity in a
challenging market environment for coal-fired generators.
At the same, Moody's affirmed Ameren's senior unsecured rating at
Baa3 with a stable outlook. . Despite the large write-down
expected to be recorded associated with the merchant segment ($1.5
billion to $2 billion on a pre-tax), the impact to earning is a
non-cash charge and Moody's understands that Ameren will remain
comfortably in compliance with its financial covenant in the
company's bank credit facility that requires consolidated debt to
remain below 65% of total capitalization. Moreover, Ameren's
credit profile should strengthen modestly as it reduces its direct
and indirect support for Ameren Genco over time. That said,
Moody's expects the transition to be gradual and incorporate a
view that such improvement, on its own, is not sufficient to
warrant an upgrade or a change in outlook at this point.
Ameren Corporation is a public utility holding company
headquartered in St. Louis, Missouri. It is the parent company of
regulated utility subsidiaries Ameren Missouri and Ameren Illinois
and unregulated generation subsidiaries Ameren Energy Generating
Company and AmerenEnergy Resources Generating Company.
The principal methodology used in this rating was Unregulated
Utilities and Power Companies published in August 2009.
AMF BOWLING: Court Approves March 18 Auction, Bid Protocol
----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia
approved bidding procedures that will govern the auction and sale
of AMF Bowling Worldwide Inc.'s assets. The Bankruptcy Court set
March 14 at 5:00 p.m., prevailing Eastern Time, as the deadline
for parties to submit offers for the assets, and March 18 at 10:00
a.m., as the auction date. The auction will be held at the New
York offices of Kirkland & Ellis in Lexington Avenue.
Objections to the sale must be received within seven days
following the date upon which the winning bid is announced.
Objections must be served to:
-- AMF Bowling's Dan McCormack
Dmccormack@amf.com
-- the Debtors' investment banker, Moelis & Company's
Robert J. Flachs
robert.flachs@moelis.com
-- the Debtors' counsel, Kirkland's Jeffrey D. Pawlitz, Esq.
jeffrey.pawlitz@kirkland.com
Kirkland's Benjamin Winger, Esq.
benjamin.winger@kirkland.com
-- the Debtors' co-counsel, Dion W. Hayes, Esq.
dhayes@mcguirewoods.com
-- counsel to the consenting lenders, Kristopher M. Hansen,
Esq., Sayan Bhattacharyya, Esq., and Marianne S. Mortimer,
Esq., at Stroock & Stroock & Lavan LLP's New York office
-- counsel for the DIP Agent and the First Lien Agent,
King & Spalding's Michael C. Rupe, Esq.
mrupe@kslaw.com
-- proposed counsel to the creditors' committee, Pachulski
Stang Ziehl & Jones' Robert J. Feinstein, Esq., and
Jeffrey N. Pomerantz
-- O'Melveny & Myers' Ben H. Logan, counsel to the ad hoc
group of second lien lenders
-- the winning bidder
-- the backup bidder
The Official Committee of Unsecured Creditors had filed an
objection to the proposed bidding procedures, explaining that,
among other things:
a) the Debtors propose a fundamentally flawed process that
limits the form of currency bidders may offer to all cash to the
extent of the DIP and First Lien debt; and
b) contemplates no role for the Committee in the sale process
other than being allowed to attend the auction; and
c) the bidding procedures fail to provide a meaningful
opportunity for the development of higher and better offers.
The Committee related that the Debtors entered into a
"restructuring support agreement" with a subset of its first lien
secured lenders contemplating that the Debtors will file and
solicit approval of a plan of reorganization comporting with terms
and conditions, well as filing the instant motion ostensibly to
run a parallel plan process to elicit higher and better bids for
the Company or its assets.
The Committee noted that the Debtors sought to approve this sale
timeline under the bidding procedures:
Event Deadline
----- --------
Cure Notice Mailed to Contract
Counterparties: Dec. 31, 2012
Bid Deadline: Feb. 25, 2013, at 5 p.m.
Adequate Assurance of Future
Performance Information Served
on Contract Counterparties: Feb. 27, 2013
Auction: Feb. 28, 2013, at 10 a.m.
Objection Deadline to Cure or
Adequate Assurance of Information: March 5, 2013
As reported by the Troubled Company Reporter on Dec. 6, 2012, the
Debtor's junior lenders hope to bid on the company and have
protested to the auction rules that they say establish AMF's
senior lenders "as the only game in town" for the bowling alley
chain.
Max Stendahl at Bankruptcy Law360 reported that JPMorgan Chase
Bank NA and a unit of private equity firm Cerberus Capital
Management LP objected to the Debtor's restructuring plan, telling
a Virginia federal judge the bankrupt bowling center operator had
not won over key lenders.
Bankruptcy Law360 related that JPMorgan and Cerberus Series Four
Holdings LLC, which hold $79.7 million in AMF Bowling's debt, said
only a handful of the company's first-lien lenders approved of the
Chapter 11 plan.
About AMF Bowling Worldwide
AMF Bowling Worldwide Inc. is the largest operator of bowling
centers in the world. The Company and several affiliates sought
Chapter 11 protection (Bankr. E.D. Va. Case Nos. 12-36493 to
12-36508) on Nov. 12 and 13, 2012, after reaching an agreement
with a majority of its secured first lien lenders and the landlord
of a majority of its bowling centers to restructure through a
first lien lender-led debt-for-equity conversion, subject to
higher and better offers through a marketing process. At the time
of the bankruptcy filing, AMF operated 262 bowling centers across
the United States and, through its non-Debtor facilities, and 8
bowling centers in Mexico -- more than three times the number of
bowling centers of its closest competitor.
Debt for borrowed money totals $296 million, including
$216 million on a first-lien term loan and revolving credit,
and $80 million on a second-lien term loan.
Mechanicsville, Virginia-based AMF first filed for bankruptcy
reorganization in July 2001 and emerged with a confirmed Chapter
11 plan in February 2002 by giving unsecured creditors 7.5% of the
new stock. The bank lenders, owed $625 million, received a
combination of cash, 92.5% of the stock, and $150 million in new
debt. At the time, AMF had over 500 bowling centers.
Judge Kevin R. Huennekens oversees the 2012 case, taking over from
Judge Douglas O. Tice, Jr. The petitions were signed by Stephen
D. Satterwhite, chief financial officer/chief operating officer.
Patrick J. Nash, Jr., Esq., Jeffrey D. Pawlitz, Esq., and Joshua
A. Sussberg, Esq., at Kirkland & Ellis LLP; and Dion W. Hayes,
Esq., John H. Maddock III, Esq., and Sarah B. Boehm, Esq., at
McGuirewoods LLP, serve as the Debtors' counsel. Moelis & Company
LLC serves as the Debtors' investment banker and financial
advisor. McKinsey Recovery & Transformation Services U.S., LLC,
serves as the Debtors' restructuring advisor. Kurtzman Carson
Consultants LLC serves as the Debtors' claims and noticing agent.
Kristopher M. Hansen, Esq., Sayan Bhattacharyya, Esq., and
Marianne S. Mortimer, Esq., at Stroock & Stroock & Lavan LLP; and
Peter J. Barrett, Esq., and Michael A. Condyles, Esq., at Kutak
Rock LLP, represent the first lien lenders.
An ad hoc group of second lien lenders are represented by Lynn L.
Tavenner, Esq., and Paula S. Beran, Esq., at Tavenner & Beran,
PLC; and Ben H. Logan, Esq., Suzzanne S. Uhland, Esq., and
Jennifer M. Taylor, Esq., at O'Melveny & Myers LLP.
The Official Committee of Unsecured Creditors is represented by
lawyers at Pachulski Stang Ziehl & Jones LLP, and Christian &
Barton LLP.
AMIN ASSOCIATES: Case Summary & 8 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Amin Associates, Inc.
7950 Shore Drive
Norfolk, VA 23518
Bankruptcy Case No.: 12-75222
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Eastern District of Virginia (Norfolk)
Judge: Stephen C. St. John
Debtor's Counsel: John D. McIntyre, Esq.
WILSON & MCINTYRE, PLLC
500 East Main Street, Suite 920
Norfolk, VA 23510
Tel: (757) 961-3900
E-mail: jmcintyre@wmlawgroup.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's eight largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/vaeb12-75222.pdf
The petition was signed by Kirit Amin, president.
APPLETON PAPERS: Kent Willetts Quits as Senior Vice President
-------------------------------------------------------------
Appleton Papers Inc. said Kent E. Willetts, its Senior Vice
President, has left the company. Mr. Willetts' departure is
effective Dec. 14, 2012.
Appleton, Wisconsin-based Appleton Papers Inc. --
http://www.appletonideas.com/-- produces carbonless, thermal,
security and performance packaging products. Appleton has
manufacturing operations in Wisconsin, Ohio, Pennsylvania, and
Massachusetts, employs approximately 2,200 people and is 100%
employee-owned. Appleton Papers is a 100%-owned subsidiary of
Paperweight Development Corp.
The Company's balance sheet at Sept. 30, 2012, showed $554.97
million in total assets, $865.48 million in total liabilities and
a $310.51 million total deficit.
* * *
Appleton Papers carries a 'B' corporate credit rating, with stable
outlook, from Standard & Poor's. IT has a 'B2/LD' probability of
default rating from Moody's.
ARCAPITA BANK: Falcon Wants to Drag Tide, HSBC in Hopper Lawsuit
----------------------------------------------------------------
Arcapita Bank B.S.C.(c) and its affiliated Debtors, including
Falcon Gas Storage Company, Inc., filed with the Bankruptcy Court
a Status Report on (1) the Adversary Action filed by the Hopper
Parties against Falcon, and (2) the related Motion for an Order
Lifting the Automatic Stay Pursuant to 11 U.S.C. Section 362(d) to
Allow Continuance of District Court Action filed by Tide, in which
Tide claims titles to approximately $70 million of the total sales
proceeds from the NorTex sale in escrow with HSBC.
On May 21, 2012, the Hopper Parties filed an adversary proceeding
against Falcon in the Bankruptcy Court seeking the immediate
payment of the $8.25 million of funds held in escrow in connection
with the sale of the natural gas storage business. The Hopper
Adversary has been assigned Case No. 12-01662 (SHL). The Hopper
Parties claim that right, title and interest in $8.25 million of
the Escrow Funds has vested in Falcon and has been assigned to the
Hopper Parties.
On June 25, 2012, Tide sought relief from the automatic stay so it
may liquidate its claims against Falcon Gas and Arcapita Bank in
the District Court Action.
At the Aug. 1, 2012 hearing on the Lift Stay Motion, Falcon, Tide
and the Hopper Parties agreed to mediate the disputes, and the
Court adjourned the hearing on the Lift Stay Motion so that the
parties could pursue mediation (Troubled Company Reporter, Oct. 9,
2012).
The Court set a further status conference on both the Lift Stay
Motion and the Hopper Adversary Proceeding for Dec. 13, 2012, both
of which were continued to Dec. 18, by Court order.
Recent Developments
On Dec. 4, 2012, counsel and principals for the Hopper Parties,
Tide and Falcon met in New York City before Judge John S. Martin
(Ret.) in an attempt to resolve disputes. Despite the parties'
efforts, the parties were unable to resolve the dispute through
the Mediation.
In the Status Report, the Debtors tell the Court that whether the
Escrowed Money is property of the Falcon estate is a key threshold
issue preventing any real progress toward settlement and is also
central to the administration of Falcon's bankruptcy case.
Further, because Tide's claim is based on "damages arising from
the purchase or sale of a security of the debtor or an affiliate
of the debtor," Tide's claim should be subordinated to the claims
of the Hopper Parties and others pursuant to Section 510(b) of the
Bankruptcy Code. Additionally, HSBC claims to hold a secured
claim based on the Escrow Agreement. Thus, the adjudication of
these threshold "core" legal issues is necessary before the claims
may be resolved and Falcon's plan may be confirmed.
"Tide and HSBC are indispensable to the issue pending in the
Hopper Adversary Proceeding and, if Tide and HSBC are joined in
the Hopper Adversary Proceeding, then all of these threshold core
issues may be resolved in a single proceeding already pending
before this Court," according to the Report.
Falcon has filed a motion for leave to file counter and third-
party claims in the Hopper Adversary Proceeding to join Tide and
HSBC. The motion is scheduled to be heard by the Court at the
next omnibus hearing on Jan. 16, 2013, at 11:00 a.m.
"The Debtors believe that there are no disputes of material facts
and that only the legal effect of those facts is at issue.
Therefore, if the counter and third party claims are allowed by
the Court, Falcon intends to file a motion for summary judgment
when it is proper to do so under the Federal Rules of Bankruptcy
Procedure."
Falcon is asking the Court not to rule on the Lift Stay Motion or
set it for final hearing at this point. Instead, Falcon proposes
that the Court set a further status conference on both the Lift
Stay Motion and the Hopper Adversary Proceeding to occur after (1)
the Court has first ruled on Falcon's Motion for leave to file a
counterclaim and third-party claims, and (2) the Court has
adjudicated the core legal issues in response to a Motion for
Summary Judgment to be filed by Falcon.
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.
On Dec. 21, 2012, the Bankruptcy Court extended the Debtors'
Exclusive Filing Period through and including Jan. 5, 2013, and
further extended the Debtors' Exclusive Solicitation Period
through and including March 5, 2013.
ARMORED AUTOGROUP: Moody's Cuts CFR/PDR to 'B3'; Outlook Stable
---------------------------------------------------------------
Moody's Investors Service downgraded Armored AutoGroup Inc.'s
Corporate Family Rating ("CFR") and Probability of Default Rating
("PDR") to B3 from B2. Concurrently, Moody's lowered the rating on
the senior secured credit facilities to B1 from Ba3, and the
rating on the senior unsecured notes to Caa2 from Caa1. These
actions reflect Moody's view that following the significant
underperformance since the 2010 LBO by Avista Capital Partners and
despite anticipated operational improvement, Armored is unlikely
to improve earnings sufficiently in the near term to return credit
metrics to levels appropriate for a B2 CFR. The rating outlook was
revised to stable from negative.
Earnings and free cash flow have underperformed expectations,
primarily due to the costly buildout and ongoing expenses for
stand-alone infrastructure following the 2010 carve-out from
Clorox, and higher run-rate advertising costs. As a result,
leverage stood in the high 8.0 times range as of September 30,
2012 on a lease-adjusted basis and excluding EBITDA add-backs.
While Moody's expects earnings to improve significantly in 2013
driven by the elimination of temporary costs associated with the
transition from the Clorox technical services agreement to stand-
alone operations as well as modest revenue growth, credit metrics
will remain weak in the near term. Moody's projects 2013 lease-
adjusted Debt/EBITDA in the mid- to high- 6.0 times range and
interest coverage of approximately 0.8 times EBIT/interest
expense.
The Actions:
Issuer: Armored AutoGroup Inc.
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3 from B2
$50 million senior secured revolving credit facility due 2015,
downgraded to B1 (LGD 2, 25%)
$300 million senior secured term loan B due 2016, downgraded
to B1 (LGD 2, 25%)
$275 million senior unsecured notes due 2018, downgraded to
Caa2 (LGD 5, 80%)
The following rating was affirmed:
Speculative Grade Liquidity Rating at SGL-3
Ratings Rationale
Armored's B3 CFR reflects the company's high leverage (in the high
8.0 times range as of September 30, 2012 on a lease-adjusted basis
and excluding EBITDA add-backs), relatively small scale, narrow
product focus in the highly fragmented and competitive auto-care
products business, and moderate vulnerability to weather-related
demand fluctuations. The rating is also constrained by the
expectation that Armored's financial policies will be dictated by
Avista's return goals going forward. The rating benefits from the
high market share and strong brand recognition of the ArmorAll and
STP products, as well as the company's broad geographic
diversification and low capital requirements.
The stable outlook reflects Moody's expectation of significant
earnings improvement in 2013 leading to leverage in the mid- to
high- 6.0 times range and positive free cash flow generation.
Armored's ratings could be downgraded if operating results fail to
improve such that Moody's expects debt/EBITDA to remain above 7.5
times by year-end 2013 or liquidity to deteriorate.
Conversely, Armored's ratings could be upgraded if the company is
able to sustain a debt/EBITDA ratio below 6.0 times and an
EBIT/interest expense ratio above 1.0 times. An upgrade will also
require an improved liquidity position.
Armored AutoGroup Inc. is a global producer and marketer of auto-
care products primarily under the ArmorAll appearance and STP
performance additives brands. Armored has been controlled by
Avista Capital Partners since a carve-out from the Clorox Company
in November 2010. Sales for the twelve month period ended
September 30, 2012 were approximately $297 million.
The principal methodology used in rating Armored AutoGroup was the
Global Packaged Goods Industry Methodology published in July 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.
ATLANTIC BROADBAND: S&P Puts 'BB+' Rating on $710MM Debt on Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its `BB+' issue-level
rating on an aggregate $710 million of senior secured, first-lien
credit facilities of co-borrowers Acquisitions Cogeco Cable II
L.P. and Atlantic Broadband (Penn) Holdings Inc. on CreditWatch
with negative implications. The credit facilities were used to
partly finance the Nov. 30, 2012, acquisition of Quincy, Mass.-
based cable-TV provider Atlantic Broadband Finance LLC (B+/Watch
Pos/--) by Montreal-based cable operator Cogeco Cable Inc.
(BB+/Watch Neg/--). "These credit facilities are restricted debt
obligations of Atlantic Broadband Atlantic Broadband without
recourse to Cogeco. The recovery rating on that debt remains at
`2', reflecting our expectation for substantial (70% to 90%)
recovery of principal in event of a payment default," S&P said.
"The CreditWatch placement on Atlantic Broadband's credit
facilities reflects the simultaneous placement of our ratings on
parent Cogeco on CreditWatch, also with negative implications,
following its agreement to purchase Canadian data center services
provider Peer 1 Network Enterprises, for about $640 million. The
'B+' corporate credit rating on Atlantic Broadband remains on
CreditWatch with positive implications as we continue to assess
the strategic, longer-term importance of Atlantic Broadband to
Cogeco. However, notwithstanding resolution of the Atlantic
Broadband corporate credit rating CreditWatch, the issue-level
rating on the Atlantic Broadband credit facilities would be
lowered if we downgraded Cogeco," S&P said.
RATINGS LIST
Atlantic Broadband Finance LLC
Corporate Credit Rating B+/Watch Pos/--
CreditWatch Action
To From
Acquisitions Cogeco Cable II L.P.
Atlantic Broadband (Penn) Holdings Inc.
Senior Secured Credit Fac BB+/Watch Neg BB+
Recovery Rating* 2 2
* Standard & Poor's does not place its recovery ratings on
CreditWatch; however, this does not preclude our recovery
assessment from potentially changing in the future.
ATP OIL: Court Approves Amendment No. 2 to DIP Agreement
--------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
authorized ATP Oil & Gas Corporation to enter into Amendment No. 2
to the DIP Credit Agreement.
Pursuant to the Amendment to the Senior Secured Superpriority
Priming Debtor-In-Possession Credit Agreement dated Aug. 29, 2012,
entered among the Debtor, the lender from time to time party
thereto and Credit Suisse AG, as administrative agent and
collateral agent, among other things:
-- the lender agreed to the extension of the credit to the
borrower; and
-- the definition of "Final DIP Budget Availability Date"
is amended to reflect:
(a) with respect to the Final DIP Budget First Tranche
Amount, any date during the period from Dec. 15, 2012, until
Jan. 2, 2013; and (b) with respect to the Final DIP Budget
Second Tranche Amount, any date during the period from
Jan. 15, 2013, until Feb. 15, 2013.
The Court also ordered that as long as the marketing materials
have been disseminated and the Debtor is diligently pursuing the
sale process, the Debtor has the right to obtain an extension of
any milestone occurring after Jan. 1, 2013, for cause, the
existence of which will be determined solely by the Debtor and the
DIP lenders.
A copy of the Amendment No. 2 is available for free at
http://bankrupt.com/misc/ATPOIL_dipcreditagreement_order.pdf
The Official Committee of Equity Security Holders has filed a sur-
reply to the Debtor's request for authorization to enter into
Amendment No. 2 to the DIP Credit Agreement. According to the
Equity Committee, it has analyzed the definition of satisfactory
APE report and the NSAI Report, and is prepared to put on evidence
to show that the NSAI Report, even with its inaccuracies and
questionable methodologies, meets the threshold amounts set forth
in the definition of satisfactory APE report. Indeed, any
shortcomings are simply immaterial.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
The Official Committee of Equity Security Holders tapped Diamond
McCarthy LLP as its counsel. Gordian Group, LLC, serves as
financial advisors and investment banker.
ATP OIL: Duff & Phelps Approved as Committee's Financial Advisor
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
authorized the Official Committee of Unsecured Creditors in the
Chapter 11 case of ATP Oil & Gas Corporation to retain Duff &
Phelps Securities, LLC, as its financial advisor effective as of
Sept. 11, 2012.
As reported in the Troubled Company Reporter on Oct. 24, 2012, the
Committee anticipates that D&P may render these services:
(a) Review and analyze the Debtor's operations, financial
condition, business plan, strategy, and operating forecasts;
(b) Analyze any merger, divestiture, joint-venture, or
investment transaction;
(c) Assist in the determination of an appropriate go-
forward/post emergence capital structure for the Debtor;
(d) Assist the Committee in raising and/or analyzing any new
debt and/or equity capital (including advice on the nature
and terms of new securities);
(e) Assist the Committee in developing, evaluating, structuring
and negotiating the terms and conditions of a restructuring
or Plan of Reorganization, including the value of the
securities, if any, that may be issued to the Committee
under any such restructuring or Plan;
(f) Evaluate the Debtor's debt capacity;
(g) If requested by the legal counsel to the Committee, prepare
expert report(s) with respect to the valuation of the Debtor
and provide expert testimony relating to such report(s) as
well as other financial matters arising in connection with
the bankruptcy; and
(h) Provide the Committee with other appropriate general
restructuring advice and litigation support.
As compensation for its services, D&P will charge:
-- Monthly Fee: The Company will pay D&P a cash fee of $150,000
per month for the term of the engagement beginning Sept. 11,
2012. The Monthly Fees will be due and payable for all
months from the inception of this engagement through the
earlier of (i) the termination of the Engagement Letter, or
(ii) the Effective Date of a confirmed Plan in the Chapter 11
case.
-- Deferred Restructuring Fee: D&P will earn a deferred
restructuring fee in the amount of $1,500,000, which will be
paid on the effective date of a restructuring transaction.
To the best of the Committee's knowledge and based upon the D&P
Declaration, D&P is a "disinterested person," as defined in 11
U.S.C. Section 101(14) and as required by 11 U.S.C. Section 328.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
The Official Committee of Equity Security Holders tapped Diamond
McCarthy LLP as its counsel. Gordian Group, LLC, serves as
financial advisors and investment banker.
ATP OIL: Epiq Approved as Committee's Information Agent
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
authorized the Official Committee of Unsecured Creditors in the
Chapter 11 case of ATP Oil & Gas Corporation, to retain Epiq
Bankruptcy Solutions, LLC as its information agent.
As reported in the Troubled Company Reporter on Nov. 13, 2012,
Epiq is expected to, among other things:
a) establish and maintain a Web site, and a telephone number
and electronic mail address for creditors to submit
questions and comments;
b) assist the Committee with certain administrative tasks,
including, but not limited to, printing and serving
documents as directed by the Committee and its counsel; and
c) provide a confidential data room, upon the request of the
Committee.
Epiq will be compensated at these discounted rates:
Title Discounted Rates
----- ----------------
Clerk $32 to $48
Case Manager $76 to $116
IT/Programming $112 to $152
Senior Case Manager/Consultant $132 to $176
Senior Consultant $180 to $220
James A. Katchadurian, executive vice president of Epiq, assures
the Court that Epiq is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
The Official Committee of Equity Security Holders tapped Diamond
McCarthy LLP as its counsel. Gordian Group, LLC, serves as
financial advisors and investment banker.
ATRIUM WINDOWS: Moody's Cuts CFR/PDR to 'Caa2'; Outlook Negative
----------------------------------------------------------------
Moody's Investors Service downgraded Atrium Windows and Doors,
Inc.'s Corporate Family and Probability of Default Ratings to Caa2
from Caa1. Atrium's inability to generate sufficient earnings, and
its stressed liquidity profile reflects Moody's view that company
now maintains an untenable capital structure. In a related action,
Moody's affirmed the Caa1 rating assigned to Atrium's senior
secured term loan. The rating outlook is changed to negative from
stable.
The following ratings/assessments were affected by this action:
Corporate Family Rating downgraded to Caa2 from Caa1;
Probability of Default Rating downgraded to Caa2 from Caa1;
$179 million senior secured term loan due 2016 affirmed at Caa1
(LGD3, 41%);
Ratings Rationale
The downgrade of Atrium's Corporate Family and Probability of
Default Ratings to Caa2 from Caa1 reflects Moody's view that the
company is unlikely to generate sufficient operating profits to
achieve a material improvement in its key credit metrics, which
Moody's projects will remain substandard over the next 12 to 18
months. Its liquidity profile will be stressed as well. Atrium
will have limited availability under its revolving credit
facility. Although the company is permitted to pay interest on
both its term loan and senior subordinated notes in-kind, cash
interest payments for 2013 will still be close to $20 million,
inhibiting the company's ability to generate funds from operations
to support needed working capital and capital expenditures. In
Moody's view Atrium now has an untenable capital structure.
Although Moody's recognizes that Atrium is addressing its cost
structure and improving working capital management, the level of
improvement will not be sufficient to meaningfully reduce its
debt. Moody's believes that a capital restructuring will be needed
to reduce debt, bringing the company's capital structure more in
line with current operating performance.
Moody's recognizes that Atrium is taking steps to improve its
operating performance, and the rating agency believes the company
will begin to benefit from these actions as conditions in the US
housing market gradually improve. The company has closed one of
its facilities and consolidated its operations at that location
with a nearby plant. In addition to reduced operating costs, the
company also expects a substantial release of working capital,
which will provide a slight boost to cash flow generation over the
next 12 months. In addition, the company has shifted its focus
away from the "direct-to-builder" segment, historically a lower
margin business. Management has instead decided to concentrate
more heavily on the higher margin repair and remodeling end
market, where it also has an established customer base. Although
the company resolved its immigration-related issues earlier this
year, it now faces increased labor costs, which are partly
offsetting cost savings from facility consolidation.
The change in rating outlook to negative from stable reflects
Moody's view that Atrium's ability to generate earnings over the
next 12 to 18 months remains constrained and that key credit
metrics are not likely to improve materially over that period. It
also incorporates Moody's belief that Atrium's stand-alone
operations will have difficulty covering its debt service
requirements and that it will need outside support from its equity
sponsors, which is in the form of preferred stock.
The ratings could come under further pressure if the expectations
for improved operating performance fail to materialize over the
next 12 to 18 months or if Atrium continues to rely on additional
capital contributions from its owners. Redemption of debt at deep
discounts or conversion of debt for equity would negatively impact
the ratings as well.
An upgrade of Atrium's corporate family rating is unlikely at this
time. Moody's believes that the company will have difficulty in
generating significant operating earnings, resulting in elevated
debt leverage credit metrics over the intermediate term.
Stabilization of the rating outlook could occur if Atrium is able
to improve its operating profitability and its liquidity profile
gets better.
The principal methodology used in rating Atrium Windows and Doors,
Inc. 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.
Atrium Windows and Doors, Inc., located in Dallas, TX, is a North
American manufacturer of residential vinyl and aluminum windows in
North America. Golden Gate Capital and Kenner & Company, Inc.
(collectively "Sponsors"), through their respective affiliates,
are the primary owners of Atrium. Revenues for the 12 months
through September 30, 2012 totaled approximately $476 million.
BADGER HOLDING: S&P Withdraws 'B+' Corp. Credit Rating on Request
-----------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its preliminary 'B+'
corporate credit rating on Waukesha, Wisc.-based Badger Holding
LLC (Safway) at the company's request. "We also withdrew our
preliminary 'B+' issue-level rating on the company's proposed $500
million senior secured term loan," S&P said.
"We withdrew our rating after Safway announced that it would not
proceed with its planned $500 million senior secured term loan and
a new $125 million asset-backed revolving credit facility
(undrawn) to refinance existing debt of its subsidiary Safway
Group Holdings LLC, which was to be the borrower under the
proposed debt," S&P said.
BENADA ALUMINUM: Can Hire Latham Shuker as Counsel
--------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida has
granted Bernada Aluminum Products LLC permission to employ R.
Scott Shuker and the law firm Latham, Shuker, Eden & Beaudine,
LLP, as counsel, nunc pro tunc to Aug. 1, 2012.
As reported by the Troubled Company Reporter on Sept. 10, 2012,
Latham's legal services are required as to, but not limited to (i)
advising as to the Debtors' rights and duties in the case; (ii)
preparing pleadings related to the case, including a disclosure
statement and plan of reorganization; and (iii) taking any and all
other necessary action incident to the proper preservation and
administration of the estate.
About Benada
Benada Aluminum Products LLC was formed in 2011 to purchase assets
of two aluminum products manufacturing companies. It purchased
via 11 U.S.C. Sec. 363 the Sanford facility of Florida Extruders
International (Case No. 08-07761). It also purchased the assets
Miami, Florida-based Benada Aluminum of Florida Inc. The Debtor
has since consolidated operations and operates only out of its
location in Sanford.
The Company filed for Chapter 11 protection on Aug. 1, 2012
(Bankr. M.D. Fla. Case No. 12-10518). Judge Karen S. Jennemann
presides over the case. R. Scott Shuker, Esq., at Latham Shuker
Eden & Beaudine LLP, represents the Debtor. The Debtor disclosed
$22,009,272 in assets and $11,698,426 in liabilities as of the
Chapter 11 filing.
Wells Fargo is represented by Michael Demont, Esq., and Jay Smith,
Esq., at Smith Hulsey & Busey, in Jacksonville, Florida. FTL
Capital is represented by Christopher J. Lawhorn, Esq., at Bryan
Cave LLP in St. Louis, Missouri. Triton Capital Partners Ltd.
serves as exclusive financial advisor and investment banker with
respect to providing assistance with turnaround management.
The Debtor was authorized by the bankruptcy judge at a Sept. 25,
hearing to sell an aluminum extrusion press for $2.9 million to
Tubelite Inc.
BENADA ALUMINUM: Committee Taps Deloitte Financial as Accountant
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Bernada Aluminum
Products LLC has sought permission from the U.S. Bankruptcy Court
for the Middle District of Florida to retain Deloitte Financial
Advisory Services LLP as its financial advisor, nunc pro tunc to
Oct. 25, 2012.
Deloitte Financial will, among other things:
a) assist and advise the Committee in connection with its
identification, development, and implementation of
strategies related to the Debtor's business plan and
other matters, as agreed, relating to the restructuring,
liquidation or sale, as the case may be, of the Debtor's
business operations;
b) assist the Committee in understanding the business and
financial impact of various operational, financial, and
strategic restructuring alternatives on the Debtor;
c) assist the Committee in its analysis of the Debtor's
financial restructuring process, including its review of
the Debtor's development of plans of reorganization and
related disclosure statements;
d) assist the Committee in its review of various financial
reports prepared for submission to the applicable court,
and, as mutually agreed, other reports that may be
requested by parties-in-interest; and
e) assist and advise the Committee in its analysis of
liquidation scenarios.
Deloitte Financial will be paid $325 per hour for its services.
Narendra Ganti, a partner at Deloitte Financial, attested to the
Court that the firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About Benada
Benada Aluminum Products LLC was formed in 2011 to purchase assets
of two aluminum products manufacturing companies. It purchased
via 11 U.S.C. Sec. 363 the Sanford facility of Florida Extruders
International (Case No. 08-07761). It also purchased the assets
Miami, Florida-based Benada Aluminum of Florida Inc. The Debtor
has since consolidated operations and operates only out of its
location in Sanford.
The Company filed for Chapter 11 protection on Aug. 1, 2012
(Bankr. M.D. Fla. Case No. 12-10518). Judge Karen S. Jennemann
presides over the case. R. Scott Shuker, Esq., at Latham Shuker
Eden & Beaudine LLP, represents the Debtor. The Debtor disclosed
$22,009,272 in assets and $11,698,426 in liabilities as of the
Chapter 11 filing.
Wells Fargo is represented by Michael Demont, Esq., and Jay Smith,
Esq., at Smith Hulsey & Busey, in Jacksonville, Florida. FTL
Capital is represented by Christopher J. Lawhorn, Esq., at Bryan
Cave LLP in St. Louis, Missouri. Triton Capital Partners Ltd.
serves as exclusive financial advisor and investment banker with
respect to providing assistance with turnaround management.
The Debtor was authorized by the bankruptcy judge at a Sept. 25,
hearing to sell an aluminum extrusion press for $2.9 million to
Tubelite Inc.
BIGLICK 254: Case Summary & 7 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Biglick 254, LLC
dba Red Hawk Golf Course
18441 US 224
Findlay, OH 45840
Bankruptcy Case No.: 12-35589
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Northern District of Ohio (Toledo)
Judge: Richard L. Speer
Debtor's Counsel: Steven L. Diller, Esq.
DILLER AND RICE, LLC
124 E Main St.
Van Wert, OH 45891
Tel: (419) 238-5025
E-mail: steven@drlawllc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's seven largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/ohnb12-35589.pdf
The petition was signed by Dennis M. Fitzgerald, owner.
BLUEGREEN CORP: Shareholders Elect 8 Directors to Board
-------------------------------------------------------
At the annual meeting of shareholders of Bluegreen Corporation
held on Dec. 13, 2012, the Company's shareholders approved the
Company's 2011 Long Term Incentive Plan. The Company's
shareholders also elected eight directors to the Company's Board
of Directors, in each case to serve for a term expiring at the
Company's 2013 Annual Meeting, and ratified the appointment of
PricewaterhouseCoopers LLP as the Company's independent registered
public accounting firm for fiscal 2012.
The newly elected directors are Alan B. Levan, John E. Abdo, James
R. Allmand, III, Norman H. Becker, Lawrence A. Cirillo, Mark A.
Nerenhausen, Arnold Sevell and Orlando Sharpe.
About Bluegreen Corp.
Bluegreen Corporation -- http://www.bluegreencorp.com/-- provides
places to live and play through its resorts and residential
community businesses.
The Company reported a net loss of $17.25 million in 2011,
compared with a net loss of $43.96 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$1.06 billion in total assets, $720.24 million in total
liabilities and $340.77 million in total shareholders' equity.
* * *
In December 2010, Standard & Poor's Rating Services raised its
corporate credit rating on Bluegreen Corp to 'B-' from 'CCC'.
This concludes the Troubled Company Reporter's coverage of
Bluegreen Corp. until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
BLYTH: Visalus Deal No Impact on Moody's 'B2' Corp. Family Rating
-----------------------------------------------------------------
Moody's Investors Service stated on Dec. 21, 2012, that Blyth's
recently announced agreement with the founders of Visalus to
increase its ownership to 80% from 73% is a credit positive for
Blyth's liquidity profile, although other elements of the
agreement are still unclear. Previously, Blyth was required to
purchase the remaining stake of Visalus for approximately
$271 million in the first half of 2013, which Moody's had cited as
a liquidity concern when the rating agency affirmed Blyth's B2 CFR
and changed its outlook to negative in September 2012. Other
elements of the agreement remain unclear.
BRIDGEVIEW AEROSOL: Committee Can Hire Plante as Consultant
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
has granted the Official Committee of Unsecured Creditors of
Bridgeview Aerosol, LLC, permission to retain Martin W. Terpstra,
CPA, CFE and Plante & Moran, PLLC to provide expert witness and
consulting services in connection with adversary proceeding
initiated by the Committee in the case.
As reported by the Troubled Company Reporter on Oct. 8, 2012, the
fees for P&M's consulting services will be based on the actual
time that Mr. Terpstra expends at his hourly rates of $440, plus
related costs incurred by P&M. Time incurred by other P&M staff
will be billed at hour rates ranging from $100 to $290. In
connection with its retention, P&M requests payment of a
refundable retainer in the amount of $10,000, which they will hold
and apply to the final invoice in connection with services
rendered pursuant to this engagement.
About Bridgeview Aerosol
Bridgeview, Illinois-based Bridgeview Aerosol, LLC, provides
manufactures, packages and distributes household cleaning and
automotive aerosol products. Affiliate AeroNuevo owns the real
property on which BVA operates. USAerosols is the parent company
of BVA and AeroNuevo.
Bridgeview Aerosol and its affiliates filed for Chapter 11
protection (Bankr. N.D. Ill. Lead Case No. 09-41021) on Oct. 30,
2009. Steven B. Towbin, Esq., at Shaw Gussis et al., assists the
Debtors in their restructuring efforts. Bridgeview Aerosol
estimated $10 million to $50 million in assets and debts as of the
Petition Date.
Adam P. Silverman, Esq., and Henry B. Merens, Esq., at Adelman &
Gettleman, Ltd., represents the Official Committee of Unsecured
Creditors.
On Nov. 19, 2009, William T. Neary, the U.S. Trustee for Region
10, amended the appointment of the Official Committee of Unsecured
Creditors. The Committee now consist of (i) Ball Aerosol &
Speciality Container; (ii) Black Flag Brands LLC; (iii) Pennock
Company; (iv) Diversified CPC International; (v) Laser Tool Inc.;
(vi) Berry Plastics Corporation; and (vii) Batavia Container, Inc.
BROOKFIELD RESIDENTIAL: S&P Assigns B+ CCR, Rates $400MM Notes BB-
------------------------------------------------------------------
Standard and Poor's Ratings Services assigned its 'B+' corporate
credit rating to Brookfield Residential Properties Inc. (BRP). The
outlook is stable. "At the same time, we assigned a 'BB-' issue-
level rating and a '2' recovery rating to the proposed offering of
$400 million of senior unsecured notes due 2020, guaranteed by all
the current and future restricted subsidiaries of the issuer other
than U.S. project subsidiaries. The '2' recovery rating indicates
prospects for a substantial recovery (70% to 90%) of principal in
the event of payment default. The company plans to use proceeds
from the notes to repay existing notes payable provided by
Brookfield Office Properties Inc. ('BBB/Negative'), borrowings
under an unsecured revolving facility provided by Brookfield Asset
Management Inc. (A-/Negative/A-2), and other project and bank
debt," S&P said.
"The ratings on BRP reflects our assessment of an 'aggressive'
financial risk profile, reflecting weak EBITDA-based metrics
(although book leverage is moderate), reliance on secured project
level debt and potential near term refinancing risk due to on-
demand secured credit facilities," said credit analyst George
Skoufis. "We view the business risk profile as 'weak'.
Brookfield's operations rely on the cyclical and capital intensive
land development and homebuilding businesses. While we believe the
nascent housing recovery in the U.S. will continue in 2013, we do
acknowledge there are headwinds, and a significant proportion of
BRP's future growth is reliant on growth derived from its U.S.
operations, which is dependent on a continued recovery in the U.S.
housing market and third party demand for lots."
"The outlook is stable. We expect continued stability in BRP's
Canadian markets and the steady recovery in the U.S. housing
markets to support revenue and EBITDA growth leading to steadily
improving credit metrics and continued adequate liquidity. The
land development business, while cyclical, should support BRP's
growth as many homebuilders continue to invest in new land to
support future growth. We would consider raising the rating if
housing demand recovers more quickly in the U.S. and remains
stable in Canada, resulting in improved cash flow such that
debt/EBITDA improves to the 3x-4x range. Alternatively, we could
lower the ratings if the recovery in the U.S. falters or the
Canadian housing market softens such that debt/EBITDA doesn't
improve over the next two years and/or liquidity becomes
constrained," S&P said.
BUFFETS INC: Names Philip Friedman & Warren Ellish to Board
-----------------------------------------------------------
Buffets, Inc. has appointed restaurant executive Philip Friedman
and marketing executive F. Warren Ellish to its Board of
Directors, thereby completing the new seven-member board of
directors formed after the company emerged from bankruptcy. Both
executives possess over 30 years of restaurant industry experience
and each has held leadership positions at growth and turnaround
brands in the restaurant and hospitality industries. The
appointments are effective immediately.
"These are true leaders with proven track records of success,"
said Rob Webster, Chairman of the Board of Buffets, Inc. "Both
Warren and Phil have the practical knowledge of what it takes to
turn around and grow a brand, and they understand the need for
strong corporate governance. We are pleased to add them to our
board of directors, and are excited for the future of our
organization with their support and expertise."
Friedman currently serves as Chairman and CEO of Salsarita's Fresh
Cantina, an 85-location casual Mexican restaurant chain he
acquired in 2011, and as President of P. Friedman & Associates,
Inc., a strategic planning and management consulting company he
founded in 1986. Friedman previously served as Chairman, Chief
Executive Officer and President of McAlister's Corporation, a
quick casual concept he acquired along with a group of investors
in 1999. During his tenure, McAlister's grew from 27 to 300
restaurants in 22 states. In 2005, Friedman led the successful
sale of McAlister's Corporation to Roark Capital Group.
Friedman was awarded Nation's Restaurant News' 2009 Golden Chain
Award honoree for his success with McAlister's and The
International Foodservice Manufacturers' Association's Silver
Plate award for his enduring and outstanding achievements in the
Chain Restaurant Full Service category. He was also honored by
the National Restaurant Association (NRA) as a Cornerstone
Humanitarian for leading McAlister's in outstanding community
involvement. He received an MBA from the University of
Pennsylvania's Wharton School, as well as a MA in Political
Science and a BA in History from the University of Connecticut.
Friedman serves on the Board of Directors for Diversified
Restaurants, Boudin Bakeries & Restaurants and Silver Diner
Corporation as well as on the boards of the National and
Mississippi Restaurant Associations.
"Phil will help us deliver on our brand vision of offering real
food and real choices, while creating real connections with our
guests," said Anthony Wedo, Buffets, Inc. Chief Executive Officer.
F. Warren EllishF. Warren Ellish is a senior marketing executive
with extensive experience in consumer products, restaurants and
retailing. Ellish has been responsible for successfully
positioning hundreds of well-known brands and has a track record
of delivering outsized returns in competitive industries. In 1995,
Ellish founded his own marketing consulting company, Ellish
Marketing Group LLC, and for the past 17 years has been advising
the senior leadership of numerous leading brands and companies
from a strategic marketing perspective. Prior to forming Ellish
Marketing Group, he served as a founding partner and Vice
President of Marketing for Boston Chicken, Inc. (Boston Market),
where he helped create a new brand in the "home meal replacement"
retail category. Ellish also served as Vice President of
Marketing and an executive committee member for Red Lobster
Restaurants (Darden), Vice President of Marketing for Luzianne
Blue Plate Foods, and other senior marketing positions with Burger
King Corporation, Johnson & Johnson and PepsiCo. Ellish was also
named to Advertising Age's "Marketing 100 - The Superstars of US
Marketing."
Ellish received both his BS and MBA from Cornell University, where
he currently serves as a member of the marketing faculty at the SC
Johnson Graduate School of Management.
"I have known Warren for 20 years and have seen his track record
of repeated successes first hand," Wedo said. "He has helped
launch start ups and driven brand turnarounds. I know that his
breadth of experience will be extremely helpful as we move this
brand forward."
About Buffets Inc.
Buffets Inc. and all of its subsidiaries filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10237) on Jan. 18,
2012, after it reached a restructuring support agreement with 83%
of its lenders to eliminate virtually all of the Company's roughly
$245 million of outstanding debt.
At the time of the bankruptcy filing, Buffets Inc., the nation's
largest steak-buffet restaurant company, operated 494 restaurants
in 38 states, comprised of 483 steak-buffet restaurants and 11
Tahoe Joe's Famous Steakhouse(R) restaurants, and franchises 3
steak-buffet restaurants in two states. The restaurants are
principally operated under the Old Country Buffet(R), HomeTown(R)
Buffet, Ryan's(R) and Fire Mountain(R) brands. The Debtors sought
to reject leases for 83 underperforming restaurants.
In its schedules, Buffets Inc. disclosed $384,810,974 in assets
and $353,498,404 in liabilities.
Buffets had 626 restaurants when it began its prior bankruptcy
case (Bankr. D. Del. Case Nos. 08-10141 to 08-10158) in 2008. It
emerged from bankruptcy in April 2009. The restaurant chain said
higher gasoline and energy costs, along with a decline in guest
count, hampered its ability to service long-term debt and caused a
liquidity strain, forcing the Company to return to Chapter 11
bankruptcy.
In the new Chapter 11 case, Buffets Inc.'s legal advisors were
Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway,
Stargatt & Taylor, LLP. The Company's financial advisor was
Moelis, Inc. Epiq Bankruptcy Solutions LLC served as claims,
noticing and balloting agent.
An ad hoc committee of secured lenders was represented by Willkie
Far & Gallagher LLP and Blank Rome LLP as counsel and Conway, Del
Genio, Gries & Co. as financial advisors. Credit Suisse, as DIP
Agent and Prepetition First Lien Agent, was represented by Skadden
Arps Slate Meagher & Flom as counsel.
The U.S. Trustee appointed a five-member Official Committee of
Unsecured Creditors in the 2012 cases.
In April 2012, Buffets Inc. filed an amended plan that proposes to
pay $4 million to a pool of unsecured creditors owed more than $44
million. Unsecured creditors were expected to recover 6% to 9% of
their claims. A prior version of the plan provided that unsecured
creditors were to receive nothing. The amended plan would create
a trust to pursue lawsuits on behalf of unsecured creditors.
First-lien lenders were to receive new stock in return for $251.8
million owing on the existing first-lien facility and $34.8
million in outstanding letters of credit.
In July 2012, Buffets Inc. emerged from Chapter 11 bankruptcy
after shedding $255 million in debt and $35 million in annual
interest payments. The bankruptcy judge signed on June 27 an
order confirming Buffets Inc.'s amended plan. All voting classes
were in favor of the plan.
CDW LLC: S&P Raises Secured Debt Rating to 'B+'; Outlook Stable
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Vernon Hills, Ill.-based CDW LLC to 'B+' from 'B'. "In
addition, we raised our senior secured debt rating to 'B+' from
'B', and our senior unsecured debt rating to 'B-' from 'CCC+'. Our
recovery ratings on the senior secured and senior unsecured debt
remain unchanged, at '3' and '6', respectively. The outlook is
stable," S&P said.
"The rating action reflects a revision of our assessment of CDW's
financial risk profile to 'aggressive' from 'highly leveraged'. We
believe the company's consistent EBITDA margins, along with debt
reductions over the past year, will support its improved financial
profile, despite highly competitive industry conditions and a
challenging economic environment," S&P said.
"CDW is the leading value-added reseller (VAR) of IT products,
solutions, and services to business, government, and education and
health care customers in the U.S. and Canada. It reaches its
existing and prospective customers through catalogs, direct mail,
outbound telemarketing, Web sites and Web advertising, and a
direct sales force. CDW's 'fair' business risk profile reflects
the company's good position in the highly fragmented reseller
market for technology products and services; this is offset by a
narrow geographic presence, relatively low-margin characteristics,
and exposure to potential IT spending weakness," S&P said.
"Revenues increased by 6.5% over the 12 months ended Sept. 30,
2012, and are approximately $10 billion annually. Although revenue
growth slowed to less than 2% in the quarter ended Sept. 30, 2012,
we expect ongoing cost-containment efforts will enable CDW to
maintain consistent profitability. CDW's adjusted annual EBITDA
margin is in the low-7% area, which is good for a distributor.
However, CDW's revenue and EBITDA base will remain vulnerable to
potential weakness in economic activity and IT spending. We have
assessed CDW's management and governance as 'satisfactory,'" S&P
said.
"CDW's aggressive financial risk profile continues to reflect its
2007 LBO legacy. Leverage remains high, but has improved to 5.4x
(pro forma for the recent debt redemption) as of Sept. 30, 2012,
down from 6.7x in the prior-year period. We expect moderate
additional reductions in funded debt levels over the next 12
months, incorporating the required 50% cash flow sweep in CDW's
credit agreement," S&P said.
CENTENNIAL BEVERAGE: Case Summary & 31 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Centennial Beverage Group, LLC
dba Big Daddy's Package Store
Doc's
Big Daddy's Liquor Beer Wine
Centennial Beverage Center
Centennial
Big Daddy's
Centennial Liquor Beer Wine
Majestic Fine Wine and Spirits
Centennial Fine Wine and Spirits
Medallion Discount Liquor Beer Wine
Big Daddy's Liquor Store
Centennial's Party Passport
Party Passport
Big Daddy's Fine Wine and Spirits
Don's Discount Liquor Beer Wine
Fat Dog Beverages
fka Vantex Enterprises, LLC
dba Centennial Quikshop
Centennial Express Mart
Majestic Liquor Beer Wine
Majestic
10410 Finnell Street
Dallas, TX 75220
Bankruptcy Case No.: 12-37901
Chapter 11 Petition Date: December 17, 2012
Court: U.S. Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Robert Dew Albergotti, Esq.
HAYNES AND BOONE, LLP
2323 Victory Avenue, Suite 700
Dallas, TX 75219-7673
Tel: (214) 651-5613
Fax: (214) 200-0350
E-mail: robert.albergotti@haynesboone.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Gregory L. Wonsmos, president.
List of the Debtor's 31 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Doug Miller Subdebt Holder $9,493,516
No. 3 Brigade Court
Dallas, TX 75225
Republic Beverage Company Trade Debt $3,412,562
P.O. Box 536389
Grand Prairie, TX
Retirement Plan for Employees of Pension $3,402,059
Centennial Liquor Stores
111 Polaris Parkway, Suite 33
Columbus, OH 43240
Centennial Acquisition, LLC Subdebt Holder $2,600,000
12377 Merit Drive, Suite 1700
Dallas, TX 75251
Michel Moreno Subdebt Holder $2,076,690
4023 Ambassador Caffery Parkway, Suite 200
Lafayette, LA 70503
Glazer?s Wholesale Trade Debt $1,848,266
P.O. Box 542648
Dallas, TX 75354
Doug Ramsey Subdebt Holder $885,930
5016 Aurburndale Avenue
Colleyville, TX 76034
Bob Zender Subdebt Holder $286,406
33 Princeton Road
Hinsdale, IL 60521
Precise Commercial Builders Trade Debt $198,752
Andrew Springer Subdebt Holder $114,562
Rob Thomas IRA Subdebt Holder $57,281
Zones Trade Debt $52,000
TXU Energy Trade Debt $46,668
Dailyaccess Corporation Trade Debt $27,295
Melvin Evans Properties, Inc. Trade Debt $25,000
The Elemento Works Trade Debt $22,921
Rite Technology Trade Debt $19,676
Montgomery Coscia Greilich LLP Trade Debt $19,951
Systems TechnologyGroup, Inc. Trade Debt $17,640
DTC (Diversified Technology) Trade Debt $17,273
Retalon, Inc. Trade Debt $17,106
Kurz Group, Inc. Trade Debt $12,788
Clear Channel Outdoor Trade Debt $11,500
PC Mall Trade Debt $10,064
Baird Air Conditioning Trade Debt $8,988
Lidji Dorey Hooper Trade Debt $8,468
Pro-Tech Trade Debt $7,071
Grocery Supply Company Trade Debt $6,068
Lynd Fueling Systems, Inc. Trade Debt $5,649
Central Control Trade Debt $5,191
AT&T Mobility Trade Debt $5,156
CHURCH STREET: Plan to Establish Liquidating Trust
--------------------------------------------------
CS DIP, LLC, formerly known as Church Street Health Management,
LLC, and the Official Committee of Unsecured Creditors filed with
the U.S. Bankruptcy Court for the Middle District of Tennessee a
First Amended Disclosure Statement explaining the Joint Plan of
Reorganization dated Dec. 13, 2012.
According to the Disclosure Statement, in general, the Plan
provides allocation of the Debtors' remaining assets for the
benefit of unsecured creditors. There are generally two types of
unsecured creditors -- holders of Patient-Related Claims on the
one hand, and all other Unsecured Claims on the other.
The Plan contemplates a Liquidating Trust being established with a
corpus consisting of the general assets of the Debtors well as the
rights to the potential insurance proceeds upon establishment of a
claims processing structure or claims distribution process.
Distributions to Unsecured Creditors will include beneficial
interests in the Trust based upon the types of Claims held and
subject to certain conditions and thresholds.
On the Effective Date, the Equity Interests in the Debtors will be
transferred to the Liquidating Trust, and the Liquidating Trustee
will be the sole member of the Post-Confirmation Debtors, with all
corporate formalities deemed to have been satisfied.
A copy of the Disclosure Statement is available for free at
http://bankrupt.com/misc/CHURCH_STREET_ds_1amended.pdf
About Church Street
Church Street Health Management, LLC, which provided management
services for 67 dental practices in 22 states, filed a Chapter 11
petition (Bankr. M.D. Tenn. Case No. 12-01573) in Nashville,
Tennessee, on Feb. 20, 2012.
The following day, four affiliates, Small Smiles Holding Company,
LLC, Forba NY, LLC, EEHC, Inc., and Forba Services, LLC, filed
their Chapter 11 petitions (Case Nos. 12-01574 to 12-01577).
As of the Petition Date, the Debtors' assets have book value of
$895 million, with debt totaling $303 million. There is about
$131.5 million owing on first-lien obligations, plus $25.6 million
on a second-lien obligation. There is an additional $152 million
on three subordinated debts. The company's finances are
structured to comply with Islamic Shariah financing regulations.
In the Chapter 11 cases, the Debtors have engaged Waller Lansden
Dortch & Davis, LLP as bankruptcy counsel, and Alvarez & Marsal
Healthcare Industry Group, LLC, as financial and restructuring
advisor. Martin McGahan, a managing director at A&M, will serve
as chief restructuring officer of Church Street. Morgan Joseph
TriArtisan, LLC, is the investment banker. Garden City Group is
the claims and notice agent.
Garrison Investment Group is providing funding for the Chapter 11
case. The credit agreement will provide the Debtor with up to an
aggregate principal amount of $12 million in a revolving credit
facility.
Church Street Health Management LLC changed its name as a result
of the sale of the business to existing first-lien lenders in
exchange for $25 million in debt. The new name for the company in
Chapter 11 is CS DIP LLC.
The U.S. Trustee for Region 8 removed two creditors from the
Official Unsecured Creditors Committee. Through the sale of
assets approved by the Court, these two members no longer have
debts against the Debtors. The Committee tapped Gilbert LLP as
special insurance and mass tort counsel.
CIRCLE STAR: Incurs $5.9-Mil. Net Loss in October 31 Quarter
------------------------------------------------------------
Circle Star Energy Corp. filed its quarterly report on Form 10-Q,
reporting a net loss of $5.9 million on $211,454 of revenues for
the fiscal second quarter ended Oct. 31, 2012, compared with a net
loss of $1.4 million on $293,677 of revenues for the second
quarter ended Oct. 31, 2011.
For the fiscal six months ended Oct. 31, 2012, the Company had a
net loss of $7.8 million on $362,058 of revenues, compared with a
net loss of $6.5 million on $509,971 of revenues for the six
months ended Oct. 31, 2011.
The Company's balance sheet at Oct. 31, 2012, showed $4.7 million
in total assets, $4.9 million in total liabilities, and
stockholders' deficit of $195,347.
The Company said: "Our net loss for the three and six months ended
Oct. 31, 2012, was $5.9 million and $7.8 million, respectively.
From our inception through Oct. 31, 2012, we have received nominal
revenues from our oil and natural gas activities, while incurring
substantial acquisition and impairment costs and overhead expenses
which have resulted in an accumulated deficit through Oct. 31,
2012 of $19.1 million. We anticipate that we will incur net
losses through fiscal 2013 and beyond until we can significantly
increase production and revenue."
The Company also held that, "At October 31, 2012, we had cash and
cash equivalents of $66,988 and a working capital deficit of
$3,371,222. For the six months ended October31, 2012, we had net
loss attributable to common shareholders of $7,805,917 and an
operating loss of $6,315,610.
"We plan further leasehold acquisitions for the remainder of
fiscal year 2013 and future periods. Exploratory and
developmental drilling is scheduled during the remainder of fiscal
2013. However, we will need additional financing for these
activities. If additional financing is not available, we will be
compelled to reduce the scope of our business activities. If we
are unable to fund our operating cash flow needs and planned
capital investments, it may be necessary to farm-out our interest
in proposed wells, sell a portion of our interest in prospects,
sell a portion of our interest in our producing oil and gas
properties, reduce general and administrative expenses, or a
combination of all of these factors.
"We may be unable to meet our capital requirements and
accordingly, there is substantial doubt as to our ability to
continue as a going concern for a reasonable period of time."
A copy of the Form 10-Q is available at http://is.gd/f4H8ex
Fort Worth, Tex.-based Circle Star Energy Corp. (OTC BB: CRCL)
owns royalty, leasehold, operating, net revenue, net profit,
reversionary and other mineral rights and interests in certain oil
and gas properties in Texas. The Company's properties are in
Crane, Scurry, Victoria, Dimmit, Zavala, Grimes, Madison,
Robertson, Fayette, and Lee Counties.
* * *
As reported by the Troubled Company Reporter on Aug. 17, 2012,
Hein & Associates LLP, in Dallas, Texas, expressed substantial
doubt about Circle Star's ability to continue as a going concern
its report on the Company's financial statements for the fiscal
year ended April 30, 2012. The independent auditors noted that
the Company has suffered recurring losses from operations and has
a working capital deficit.
CLEAR CHANNEL: Bank Debt Trades at 17% Off in Secondary Market
--------------------------------------------------------------
Participations in a syndicated loan under which Clear Channel
Communications, Inc., is a borrower traded in the secondary market
at 82.74 cents-on-the-dollar during the week ended Friday,
Dec. 21, an increase of 0.49 percentage points from the previous
week according to data compiled by LSTA/Thomson Reuters MTM
Pricing and reported in The Wall Street Journal. The Company pays
365 basis points above LIBOR to borrow under the facility. The
bank loan matures on Jan. 30, 2016, and carries Moody's Caa1
rating and Standard & Poor's CCC+ rating. The loan is one of the
biggest gainers and losers among 197 widely quoted syndicated
loans with five or more bids in secondary trading for the week
ended Friday.
About Clear Channel
San Antonio, Texas-based CC Media Holdings, Inc. (OTC BB: CCMO) --
http://www.ccmediaholdings.com/-- is the parent company of Clear
Channel Communications, Inc. CC Media Holdings is a global media
and entertainment company specializing in mobile and on-demand
entertainment and information services for local communities and
premier opportunities for advertisers. The Company's businesses
include radio and outdoor displays.
For the six months ended June 30, 2012, the Company reported a net
loss attributable to the Company of $182.65 million on
$2.96 billion of revenue. Clear Channel reported a net loss of
$302.09 million on $6.16 billion of revenue in 2011, compared with
a net loss of $479.08 million on $5.86 billion of revenue in 2010.
The Company had a net loss of $4.03 billion on $5.55 billion of
revenue in 2009.
The Company's balance sheet at June 30, 2012, showed
$16.45 billion in total assets, $24.31 billion in total
liabilities, and a $7.86 billion total shareholders' deficit.
Bankruptcy Warning
At March 31, 2012, the Company had $20.7 billion of total
indebtedness outstanding. The Company said in its quarterly
report for the period ended March 31, 2012, that its ability to
restructure or refinance the debt will depend on the condition of
the capital markets and the Company's financial condition at that
time. Any refinancing of the Company's debt could be at higher
interest rates and increase debt service obligations and may
require the Company and its subsidiaries to comply with more
onerous covenants, which could further restrict the Company's
business operations. The terms of existing or future debt
instruments may restrict the Company from adopting some of these
alternatives. These alternative measures may not be successful
and may not permit the Company or its subsidiaries to meet
scheduled debt service obligations. If the Company and its
subsidiaries cannot make scheduled payments on indebtedness, the
Company or its subsidiaries, as applicable, will be in default
under one or more of the debt agreements and, as a result the
Company could be forced into bankruptcy or liquidation.
* * *
As reported in the TCR on Oct. 17, 2012, Fitch Ratings has
affirmed the 'CCC' Issuer Default Rating (IDR) of Clear Channel
Communications, Inc. The Rating Outlook is Stable.
Fitch's ratings concerns center on the company's highly leveraged
capital structure, with significant maturities in 2016; the
considerable and growing interest burden that pressures FCF;
technological threats and secular pressures in radio broadcasting;
and the company's exposure to cyclical advertising revenue. The
ratings are supported by the company's leading position in both
the outdoor and radio industries, as well as the positive
fundamentals and digital opportunities in the outdoor advertising
space.
The TCR also reported in October 2012 that Standard & Poor's
Ratings Services assigned Clear Channel's proposed $2 billion
priority guarantee notes due 2019 an issue-level rating of 'CCC+'
(the same level as the 'CCC+' corporate credit rating on the
parent company) and a recovery rating of '4', indicating its
expectation for average (30% to 50%) recovery in the event of a
payment default.
"In addition, we are affirming our 'CCC+' corporate credit rating
on both the holding company, CC Media Holdings Inc., and operating
subsidiary Clear Channel, which we view on a consolidated basis;
the rating outlook is negative," said Standard & Poor's credit
analyst Jeanne Shoesmith.
"The CC Media Holdings Inc. reflects the company's steep debt
leverage and significant 2016 debt maturities. The proposed
transaction extends about $2 billion of debt from 2014 and 2016 to
2019 and reduces 2016 maturities from $12 billion to a little over
$10 billion. However, the interest rate on the new debt is about
5% higher than the existing term loan B debt. As a result, we
expect that EBITDA coverage of interest will be very thin at about
1.2x and that discretionary cash flow will be only modestly
positive in 2013, hindering the company's ability to repay debt
and afford additional refinancing transactions with similar
interest rate increases. The transaction increases the company's
flexibility to repay 2014 maturities (currently $1.5 billion),
which previously could only be repaid on a pro rata basis, and now
permits the company to exchange and extend $3 billion of
additional loans. We still view a significant increase in the
average cost of debt or deterioration in operating performance for
either cyclical, structural, or competitive reasons, as major
risks as the company proceeds with a strategy to deal with its
2016 maturities," S&P said.
COGECO CABLE: S&P Puts 'BB+' CCR on Watch on Peer 1 Purchase Pact
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it placed its ratings on
Montreal-based cable services provider Cogeco Cable Inc. and its
subsidiaries, including its 'BB+' corporate credit rating on the
company, on CreditWatch with negative implications.
"This CreditWatch placement follows Cogeco Cable's announcement
that it has entered into an agreement to acquire Vancouver-based
data center services provider Peer 1 Network Enterprises Inc. for
C$634 million," said Standard & Poor's credit analyst Madhav Hari.
"The price includes the assumption of about C$109 million in debt.
The purchase price represents a valuation of about 15x annualized
run-rate EBITDA of US$43 million for Peer 1 based on results from
the three months ended Sept. 30, 2012. We understand that Cogeco
Cable has secured C$625 million of committed bank financing to
fund the purchase. The transaction is subject to Peer 1
shareholder and regulatory approvals, and we expect it to close by
early February 2013," Mr. Hari added.
"Peer 1 is an Internet infrastructure provider, delivering
managed, dedicated, co-location and network services through 19
data centers and 21 points-of-presence located in 14 cities across
North America and Europe, connected together by its own Internet
protocol backbone network. The company's services are designed to
enable its customers to focus on their businesses rather than the
complexities of maintaining or expanding their Internet
infrastructure. Peer 1's principal target market is small and
midsize businesses whose activities increasingly depend on the
Internet. The company has a customer base of more than 10,000
businesses and derives the vast majority (78%) of its revenue from
managed and dedicated hosting services," S&P said.
Cogeco Cable is the second-largest cable operator in the provinces
of Ontario and Quebec in terms of basic cable TV subscribers. The
company offers analog and digital cable TV, high-speed Internet,
and digital telephony services to more than 1.6 million
households, typically in midsize urban communities. The company
also provides data connectivity and co-location services to
business customers. On Nov. 30, 2012, Cogeco Cable completed the
C$1.4 billion debt-funded purchase of U.S.-based Atlantic
Broadband LLC (B+/Watch Pos/--), a midsize cable system operator
serving approximately 250,000 basic subscribers.
"The CreditWatch negative placement indicates that we could either
affirm or lower the ratings on Cogeco Cable in the near future.
Standard & Poor's will likely resolve this CreditWatch once it has
evaluated the company's future capital allocation plan,
specifically its ability and willingness to reduce leverage to
below our 3.5x target on a sustained basis. In addition to the
company's near-to-medium term growth plans, we will also assess
Cogeco Cable's liquidity position given the increased scale and
scope of operations and large drawdown on its bank facilities to
fund two large acquisitions. Given the possibility of additional
senior secured debt at Cogeco Cable to support the Peer 1
purchase, our review will also assess the impact, if any, on the
'1' recovery rating on the company's senior secured debt," S&P
said.
COMMUNITY FINANCIAL: May Issue Up to 75 Million Common Shares
-------------------------------------------------------------
Community Financial Shares, Inc., received the requisite consents
from a majority of the holders of the outstanding shares of common
stock of the Company to amend the Company's Certificate of
Incorporation to:
(1) increase the authorized number of shares of the common
stock of the Company, no par value, to 75,000,000 shares
from 5,000,000 shares; and
(2) revise Article Tenth of the Certificate of Incorporation
to specify that each outstanding share of Company common
stock is entitled to one vote on each matter submitted to
a vote of the Company's stockholders.
About Community Financial
Glen Ellyn, Illinois-based Community Financial Shares, Inc., is a
registered bank holding company. The operations of the Company
and its banking subsidiary consist primarily of those financial
activities common to the commercial banking industry. All of the
operating income of the Company is attributable to its wholly-
owned banking subsidiary, Community Bank-Wheaton/Glen Ellyn.
BKD, LLP, in Indianapolis, Indiana, issued a going concern
qualification on the consolidated financial statements for the
year ended Dec. 31, 2011. The independent auditors noted that the
Company has suffered recurring losses from operations and is
undercapitalized.
The Company reported a net loss of $11.01 million on net interest
income (before provision for loan losses) of $10.77 million in
2011, compared with a net loss of $4.57 million on net interest
income (before provision for loan losses) of $10.40 million in
2010.
The Company's balance sheet at Sept. 30, 2012, showed $334.17
million in total assets, $328.69 million in total liabilities and
$5.48 million in total shareholders' equity.
COMMUNITY WEST: Treasury Sells 15,600 Series A Preferred Shares
---------------------------------------------------------------
The United States Department of the Treasury sold all 15,600 of
its shares of the Community West Bancshares's Fixed Rate
Cumulative Perpetual Preferred Stock, Series A, no par value,
having a liquidation preference of $1,000 per share. The Treasury
had acquired the Shares on Dec. 19, 2008, as part of the
Treasury's Troubled Asset Relief Program - Capital Purchase
Program. The Treasury continues to hold a warrant to purchase up
to 521,158 shares of the Company's common stock, no par value, at
an exercise price of $4.49 per share.
The Treasury sold the Shares in a non-public offering as part of a
modified "Dutch auction" process. The Company did not bid on any
of the Shares, which were all sold to third party purchasers
unaffiliated with the Company. The Company did not receive any
proceeds from this auction. As a result of the Treasury's sale of
the Shares, the Company's operations will no longer be limited by
the TARP restrictions or regulations regarding executive
compensation.
About Community West
Goleta, Calif.-based Community West Bancshares ("CWBC") was
incorporated in the State of California on Nov. 26, 1996, for the
purpose of forming a bank holding company. On Dec. 31, 1997, CWBC
acquired a 100% interest in Community West Bank, National
Association. Effective that date, shareholders of CWB became
shareholders of CWBC in a one-for-one exchange. The acquisition
was accounted at historical cost in a manner similar to pooling-
of-interests.
Community West Bancshares is a bank holding company. CWB is the
sole bank subsidiary of CWBC. CWBC provides management and
shareholder services to CWB.
Community West's balance sheet at Sept. 30, 2012, showed
$556.79 million in total assets, $505.98 million in total
liabilities and $50.81 million in total stockholders' equity.
Consent Agreement
According to the regulatory filing for the quarter ended June 30,
2012, the Bank entered into a consent agreement with the
Comptroller of the Currency ("OCC"), the Bank's primary banking
regulator, which requires the Bank to take certain corrective
actions to address certain deficiencies in the operations of the
Bank, as identified by the OCC (the "OCC Agreement").
"Article III of the OCC Agreement requires a capital plan and
requires that the Bank achieve and maintain a Tier 1 Leverage
Capital ratio of 9% and Total Risk-Based Capital ratio of 12% on
or before May 25, 2012. The Bank's Board of Directors has
incorporated a three-year capital plan into the Bank's strategic
plan. The Bank successfully met the minimum capital requirements
as of May 25, 2012. Notwithstanding that the Bank has achieved
the required minimum capital ratios required by the OCC Agreement,
the existence of a requirement to maintain a specific capital
level in the OCC Agreement means that the Bank may not be deemed
"well capitalized" under applicable banking regulations."
CORAL POINT: Case Summary & Largest Unsecured Creditor
------------------------------------------------------
Debtor: Coral Point Investment LLC
a California Limited Liability Company
220 Newport Center Dr Ste 11-600
Newport Beach, CA 92660
Bankruptcy Case No.: 12-24224
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Central District of California (Santa Ana)
Judge: Catherine E. Bauer
Debtor's Counsel: Maziar Mafi, Esq.
LAW OFFICE OF MAZIAR MAFI
1502 N Broadway
Santa Ana, CA 92706
Tel: (714) 543-3350
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
In its list of 20 largest unsecured creditors, the Company
disclosed one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Preferred Bank Bank Loan $800,000
Madelyn Hiyashi
17515 Colima Rd
City of Industry,
CA 91748
The petition was signed by Bryan Dopp, managing member.
CREATIVE VISTAS: Suspends Filing of SEC Reports
-----------------------------------------------
Creative Vistas, Inc., filed a Form 15 with the U.S. Securities
and Exchange Commission to voluntarily terminate registration of
its common stock and suspend its reporting obligations with the
SEC. As of Dec. 18, 2012, there were only 296 holders of the
Company's common shares.
About Creative Vistas
Headquartered in Whitby, Ontario, Canada, Creative Vistas, Inc.,
provides security-related technologies and systems. The Company
also provides the deployment of broadband services to the
commercial and residential market. The Company primarily operates
through its subsidiaries AC Technical Systems Ltd. and Iview
Digital Video Solutions Inc., to provide integrated electronic
security-related technologies and systems.
In its audit report for the year ended Dec. 31, 2011, results,
Kingery & Crouse, P.A., in Tampa, Florida, expressed substantial
doubt about the Company's ability to continue as a going concern.
The independent auditors noted that the Company has suffered
recurring losses from continuing operations and has working
capital and stockholder deficiencies.
Creative Vistas' balance sheet at Sept. 30, 2012, showed
$3.31 million in total assets, $5.27 million in total liabilities
and a $1.95 million stockholders' deficiency.
D MEDICAL: Receives $1.48 Million Default Notice From Supplier
--------------------------------------------------------------
D. Medical Industries Ltd. received a notification from MedPlast
HealthCare EPZ Co. Ltd. (formerly named UPG Suzhou EPZ Co. Ltd.),
with which the Company has engaged in a manufacture agreement
dated Aug. 17, 2010, claiming that the Company has breached the
manufacture agreement by not paying in consideration for products
which were ordered from UPG, totaling $1.48 million.
As stated in the notice, until the Company will pay off the
aforesaid debt, UPG will keep holding the Company's production
lines and equipment, and will not transfer them to any third
party, even if the Company sells them to such third party.
In the event that the Company will not pay off its debt within 30
days, UPG will commence to performing procedures for the purpose
of selling the aforementioned production lines and equipment in
order to pay off the debt.
At the request of Israel Securities Authority, the Company
clarifies that UPG holds the Company's production lines, that are
recorded in the Company's books as a part of the fixed assets in a
sum of NIS431,829 (net of depreciation), as well as in the
inventory of completed products that are recorded in the Company's
books as a part of the inventory in a sum of NIS1,083,015, all as
specified under the Company's financial statements as of Sept. 30,
2012.
The Company has various claims in relation to the debt demanded by
UPG, and it disagrees on a substantial part of the demanded sum.
At this stage, the Company examines the claims relating to the
commercial disagreements between the parties, and will
correspondingly respond afterwards.
About D. Medical
D. Medical -- http://www.dmedicalindustries.com/-- is a medical
device company that holds through its subsidiaries a portfolio of
products and intellectual property in the area of insulin and drug
delivery. D. Medical has developed durable and semi-disposable
insulin pumps, which continuously infuse insulin into a patient's
body, using its proprietary spring-based delivery technology. D.
Medical believes that its spring-based delivery mechanism is cost-
effective compared to the motor and gear train mechanisms that
drive competitive insulin pumps and also allows it to incorporate
certain advantageous functions and design features in its insulin
pumps.
The Company reported a net loss of NIS 48.30 million on
NIS 1.51 million of sales for 2011, compared with a net loss of
NIS 45.89 million on NIS 1.26 million of sales for 2010.
The Company's balance sheet at Sept. 30, 2012, showed
NIS8.7 million in total assets, NIS7.7 million in total
liabilities, and equity of NIS1.0 million.
As reported by the Troubled Company Reporter on July 18, 2012,
Kesselman & Kesselman, in Haifa, Israel, expressed substantial
doubt about D. Medical Industries Ltd.'s ability to continue as a
going concern, following the Company's results for the fiscal year
ended Dec. 31, 2011. The independent auditors noted that the
Company has suffered recurring losses and negative cash flows from
operations.
DAFFY'S INC: Plan Confirmation Hearing Adjourned to Feb. 20
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
adjourned to Feb. 20, 2013, at 10 a.m., the hearing scheduled for
Dec. 17, 2012, to consider confirmation of Daffy's Inc.'s proposed
Chapter 11 Plan.
As reported by the Troubled Company Reporter on Aug. 3, 2012,
Daffy's Inc. will shut the business and has a bankruptcy plan that
would pay off creditors in full.
About Daffy's Inc.
Secaucus, New Jersey-based Daffy's Inc., a 19-store chain, off-
price retailer of designer fashions for women, men, children, and
the home, located in the New York metropolitan area and
Philadelphia, filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y.
Case No. 12-13312) on Aug. 1, 2012, with a plan to shutter the
business and pay off creditors in full. A copy of the Plan is
available at:
http://bankrupt.com/misc/Daffys_Chapter_11_Plan.pdf
The Debtor has an Asset Purchase, Assignment and Support
Agreement, dated as July 18, 2012, with Marcia Wilson, The Wilson
2003 Family Trust, and Jericho Acquisitions I LLC, pursuant to
which the Debtor's leasehold interests will be sold to Jericho
Acquisitions I LLC through the Plan.
The Debtor has hired Gordon Brothers Retail Partners, LLC and
Hilco Merchant Resources LLC to liquidate the Debtor's inventory.
The Debtor estimates that the proceeds received from the
liquidation of its inventory and the sale of its leasehold
interests will exceed at least $60 million to satisfy
approximately $37 million in claims. Cost of administering the
chapter 11 case will not exceed approximately $5 million (after
certain expenses are reimbursed pursuant to the Purchase
Agreement). Accordingly, the Debtor believes that the disposition
of the Debtor's principal assets will generate more than
sufficient cash to pay all holders of Allowed Claims (as such term
is defined in the Plan) in full, with interest, thus rendering all
classes under the Plan unimpaired.
The Debtor has filed its schedules, disclosing $51,106,469 in
total assets and $36,646,856 in total liabilities.
Bankruptcy Judge Martin Glenn presides over the case. The Debtor
is represented by Andrea Bernstein, Esq., and Debra A. Dandeneau,
Esq., at Weil, Gotwill & Manges LLP as counsel. Donlin, Recano &
Company, Inc., serves as claims and notice agent.
The Debtor's case is being funded by a $10 million postpetition
financing with Vim-3, L.L.C., Vimwilco, L.P., and Marcia Wilson,
as successor to Vim Associates, as guarantors; and Wells Fargo,
National Association, as DIP lender. The DIP loan consists of
$2.5 million in new money loans available on a revolving basis;
and the roll up of $6.2 million of existing prepetition debt.
Counsel for the DIP Lender are Donald E. Rothman, Esq., and
Nathan C. Pagett, Esq., at Riemer & Braunstein LLP.
Gordon Brothers and Hilco Merchant Resources are represented by
Curtis, Mallet-Prevost, Colt & Mosle LLP.
Jericho Acquisition is represented by Brad Eric Scheler, Esq., at
Fried, Frank, Harris, Shriver & Jacobson LLP.
Marcia Wilson is represented by Dana B. Cobb, Esq., at Beattie
Padovano, LLC.
DBI HOUSING: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: DBI Housing, Inc.
dba Ortiz Produce
dba DBI Housing, LLC
dba DBI Bambi Fashion
dba Tacos Ortiz
4808 West Washington Blvd.
Los Angeles, CA 90016
Bankruptcy Case No.: 12-51335
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Judge: Thomas B. Donovan
Debtor's Counsel: M. Jonathan Hayes, Esq.
LAW OFFICE OF M JONATHAN HAYES
9700 Reseda Bl Ste 201
Northridge, CA 91324
Tel: (818) 882-5600
Fax: (818) 882-5610
E-mail: jhayes@hayesbklaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 18 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/cacb12-51335.pdf
The petition was signed by David Irias, president.
Affiliate who filed a separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- --------
David Antonio Irias and 11-41730 07/25/11
Blanca Rosa Irias
DEEP PHOTONICS: Plan Filing Exclusivity Extended to April 12
------------------------------------------------------------
Deep Photonics Corporation has sought and obtained an extension
until April 12, 2013, of the deadline to file its Chapter 11 plan
and disclosure statement.
Deep Photonics Corporation filed a Chapter 11 petition (Bankr. D.
Ore. Case No. 12-35626) on July 20, 2012. Deep Photonics designs
and manufactures innovative solid-state fiber lasers. The Debtor
scheduled $75,111,128 in assets and $4,917,393 in liabilities.
Bankruptcy Judge Trish M. Brown presides over the case. Timothy
J. Conway, Esq., at Tonkon Torp LLP, serves as the Debtor's
counsel. The petition was signed by Theodore Alekel, president.
The U.S. Trustee has not appointed an official committee of
unsecured creditors because an insufficient number of persons
holding unsecured claims against the Debtor have expressed
interest in serving on a committee. The U.S. Trustee reserves the
right to appoint such a committee should interest developed among
the creditors.
DEMCO INC: Court Extends Exclusive Plan Filing Period to April 5
----------------------------------------------------------------
The Hon. Michael J. Kaplan of the U.S. Bankruptcy Court for the
Western District of New York has extended, at the behest of Demco,
Inc., the period within which the Debtor may file a plan of
reorganization to April 5, 2013, and the period within which the
Debtor may solicit acceptances of that plan to June 4, 2013.
The Debtor's statutory Exclusive Period for filing a plan was
previously set to expire on Dec. 6, 2012, and the time within
which to solicit acceptances of that plan was previously set to
expire on Feb. 4, 2013.
On Nov. 13, 2012, the Debtor sought the extension of the
Exclusivity Periods, saying that its efforts have not yet yielded
a result that will enable the Debtor to propose a plan of
reorganization during the first 120 days of this bankruptcy case.
"Terminating the exclusivity periods before the Debtor has an
adequate opportunity to resolve key issues affecting any proposed
plan of reorganization will frustrate the purpose of Bankruptcy
Code Section 1121," the Debtor said. The Debtor submitted that
the initial 120-day exclusivity period has not been a sufficient
amount of time to permit it to achieve this objective.
The Debtor has held talks with several entities regarding
potential recapitalization of the Debtor's business through
obtaining either new investments in the business or additional
financing for the business. The Debtor's efforts towards those
objectives are continuing at the present time.
About Demco Inc.
Demco, Inc., aka Decommissioning & Environmental Management
Company, is a specialty trade contractor based in West Seneca, New
York, which provides demolition services, nuclear work,
environmental clean-up, disaster response and a variety of other
services throughout the United States and, on a project-by-project
basis, internationally. Some of Demco's better known demolition
projects in the past have included the Rocky Flats Nuclear Power
Plant, Yankee Stadium, the Orange Bowl, Buffalo Memorial
Auditorium, and the Sunflower Army Ammunition Plant.
Demco filed for Chapter 11 protection (Bankr. W.D. N.Y. Case No.
12-12465) on Aug. 6, 2012. Bankruptcy Judge Michael J. Kaplan
presides over the case. Daniel F. Brown, Esq., at Andreozzi,
Bluestein, Fickess, Muhlbauer Weber, Brown, LLP, represent the
Debtor in its restructuring effort. The Debtor estimated assets
and debts at $10 million to $50 million. The petition was signed
by Michael J. Morin, controller.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed three
creditors to serve on the Official Committee of Unsecured
Creditors.
DEWEY & LEBOEUF: Has Access to Cash Collateral Until February 3
---------------------------------------------------------------
In a seventh supplemental order dated Dec. 20, 2012, the U.S.
Bankruptcy Court for the Southern District of New York further
extended and modified the final order, dated June 13, 2012,
authorizing Dewey & LeBoeuf LLP to use cash collateral of the
collateral agent, revolving lenders and noteholders, through the
earlier to occur of (a) 11:59 p.m. on the fifth day following the
"termination declaration date", or (b) 11:59 p.m. on Feb. 3, 2013.
The Challenge Period as defined in the Final Order and as extended
in the Supplemental Orders, is extended for an additional 30 days
without prejudice to seeking a further extension of the Final
Order.
A copy of the final cash collateral order is available at:
http://bankrupt.com/misc/dewey.doc91.pdf
About Dewey & LeBoeuf
Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y.
Case No. 12-12321) to complete the wind-down of its operations.
The firm had struggled with high debt and partner defections.
Dewey disclosed debt of $245 million and assets of $193 million in
its chapter 11 filing late evening on May 29, 2012.
Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird
-- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in
1929. In recent years, more than 1,400 lawyers worked at the firm
in numerous domestic and foreign offices.
At its peak, Dewey employed about 2,000 people with 1,300 lawyers
in 25 offices across the globe. When it filed for bankruptcy,
only 150 employees were left to complete the wind-down of the
business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
$6 million. The Pension benefit Guaranty Corp. took $2 million of
the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
Dewey on Nov. 21, 2012, filed a Chapter 11 liquidating plan and
disclosure statement, which incorporates the partner contribution
plan approved by the bankruptcy court in October. Under the so-
called PCP, 440 former partners will receive releases in exchange
for $71.5 million in contributions. The plan is also based on a
proposed settlement between secured lenders and the unsecured
creditors' committee. Secured lenders will have an allowed
secured claim for $261.9 million, along with a $100 million
unsecured claim for the shortfall in collections on their
collateral. Unsecured creditors will have $285 million in allowed
claim. In the new lender settlement, secured creditors would
permit $54 million in collection of accounts receivable to be
utilized in the liquidation. From the first $67.5 million
collected in the partners' settlement, the plan offers 80% to
secured lenders, with the remaining 20% earmarked for unsecured
creditors. Collections from the partners settlement above $67.5
million would be split 50-50 between secured and unsecured
creditors. Meanwhile, secured creditors will receive no
distribution on the $100 million deficiency claim from the first
$67.5 million from the partners' settlement. If secured lenders
don't agree to release partners, they receive nothing from the
partners' settlement payments. From collection of other assets --
such as insurance, claims against firm management and lawsuits --
the plan divides proceeds, with lenders receiving 60% to 70% and
unsecured creditors taking the remainder.
A hearing to approve the explanatory Disclosure Statement is set
for Jan. 3 at 2:00 p.m. Objections to the Disclosure Statement
are due Dec. 24. The Debtor aims a confirmation hearing to
approve the plan by the end of February.
DISH DBS: Fitch Rates Senior Unsecured Notes 'BB-'; Outlook Neg.
----------------------------------------------------------------
Fitch Ratings has assigned a 'BB-' rating to DISH DBS
Corporation's (DDBS) $1.5 billion offering of senior secured notes
due 2023. DDBS is a wholly owned subsidiary of DISH Network
Corporation (DISH, Fitch Issuer Default Rating of 'BB-').
Proceeds from the offering are expected to be used for general
corporate purposes including spectrum-related transactions which
will support the company's unspecified wireless strategy. DISH
had approximately $10.4 billion of debt outstanding as of Sept.
30, 2012. The Rating Outlook is Negative.
DISH's credit profile has weakened considerably during the course
of 2012 due to inconsistent operating performance and elevating
debt levels. DISH's leverage was 3.3x on a last 12 month (LTM)
basis as of Sept. 30, 2012, which is over a full turn higher than
year-end 2011 measures. Pro forma for the issuance, DISH's
leverage increased to 3.8x as of Sept. 30, 2012, which limits the
company's financial flexibility at the current ratings.
The company's liquidity position is strong and supported by cash
and marketable securities on hand and expected, albeit pressured,
free cash flow generation. Cash marketable security balances, pro
forma for the issuance, increase to approximately $7.9 billion.
Fitch expects near term-uses of cash will include $700 million
legal settlement and a $1 per share special dividend expected to
total $450 million. The company also benefits from a favorable
maturity schedule, as the next scheduled maturity is in 2013
totaling $500 million followed by $1 billion during 2014. Fitch
notes, however, that the company does not maintain a revolver,
which increases DISH's reliance on capital market access to
refinance current maturities, elevating the refinancing risk
within the company's credit profile. The risk is offset by the
company's consistent access to capital markets and strong
execution.
DISH's wireless strategy took a step forward as the company
secured FCC approval to use 40 MHz of S-band wireless spectrum
(now designated as the AWS - 4 band). The FCC order includes
power limitations on a portion of DISH's uplink spectrum and
requires DISH to tolerate potential interference from adjacent
wireless spectrum. The order requires DISH to provide reliable
signal coverage and terrestrial service to 40% of its total AWS -
4 population within four years. The final build-out milestone
requires signal coverage and service to 70% of population in each
of its license areas within seven years. If DISH fails to meet
the interim build-out requirement, the final build-out requirement
will be accelerated from seven years to six years. Furthermore,
if the final build-out requirement is not satisfied, DISH's
license for each economic area not in compliance with the final
build-out requirement will terminate automatically.
The Negative Outlook encompasses the lack of visibility as well as
the potential capital and execution risks associated with DISH's
wireless strategy. While DISH has yet to fully articulate its
wireless strategy, the company has committed over $3.5 billion of
capital to acquire wireless spectrum. Event risks are elevated as
the company contemplates additional acquisitions of spectrum or
assets to support the wireless strategy. Fitch believes the
company will strike a network infrastructure sharing arrangement
to enter into the wireless market as opposed to deploying a
greenfield wireless network. However, recent consolidation,
investments, and spectrum acquisitions within the wireless sector
have reduced the number of potential entities DISH can partner
with to deploy its wireless network.
Fitch believes the company's overall credit profile has limited
capacity to accommodate DISH's inconsistent operating performance.
DISH lost approximately 19,000 subscribers during the third
quarter of 2012 and has gained approximately 97,000 subscribers
during the LTM ended Sept. 30, 2012. DISH is in the process of
re-positioning its brand away from a value proposition to a more
technology and product focus. The challenge is to re-energize
subscriber growth without sacrificing subscriber economics
(arguably already weak) or credit quality. Key to a successful
transition will be the company's ability to reduce churn while
introducing new products and services valued by subscribers that
are not easily replicated by the competition.
DISH continues to struggle to increase service ARPUs as the
company elected not to take a price increase during 2012. This
decision combined with higher programming and subscriber
acquisition costs has had a dramatic effect on the company's cash
flow generation. Lower pre-SAC cash flow combined with a 14.7%
increase in subscriber acquisition costs led to an 18.7% year-
over-year decline in DISH's third-quarter EBITDA. EBITDA margin
during the current period fell 400 basis points compared to the
third quarter of last year, to 19.9%, which unfavorably compares
to DIRECTV's reported EBITDA margin of 23%.
DISH generated nearly $857 million of free cash flow (defined as
cash flow from operations less capital expenditures and dividends)
during the LTM ended Sept. 30, 2012. Fitch expects capital
intensity will be relatively consistent over the near term and
that capital expenditures will continue to focus on subscriber
retention and capitalized subscriber premises equipment. Absent
further investment in a wireless network or other strategic
initiative, Fitch anticipates that DISH will continue generating
relatively stable levels of free cash flow during the current
ratings horizon while incorporating higher levels of cash taxes.
Rating concerns center on DISH's ability to adapt to the evolving
competitive landscape, DISH's lack of revenue diversity and narrow
product offering relative to its cable MSO and telephone company
video competition, and an operating profile and competitive
position that continue to lag behind its peer group. DISH's
current operating profile is focused on its maturing video service
offering and lacks growth opportunities relative to its
competition.
Rating Triggers
Revision of the Outlook to Stable at the current rating level can
occur as the company demonstrates that it can execute its wireless
strategy in a credit-neutral manner.
Fitch believes negative rating action will likely coincide with
the company's decision to execute a wireless strategy, or other
discretionary management decisions that weaken its ability to
generate free cash flow, erode operating margins, and increase
leverage higher than 4x without a clear strategy to de-lever the
company's balance sheet.
EDISON MISSION: Taps Kirkland & Ellis as Lead Counsel
-----------------------------------------------------
Edison Mission Energy, et al., propose to employ Kirkland & Ellis
LLP as lead restructuring counsel, nunc pro tunc to the Petition
Date.
Kirkland's current hourly rates for matters related to the chapter
11 cases are projected to range as follows:
Billing Category Range
---------------- -----
Partners $665 to $1,335
Of Counsel $455 to $1,150
Associates $370 to $795
Paraprofessionals $150 to $340
It is Kirkland's policy to charge its clients in all areas of
practice for identifiable, non-overhead expenses incurred in
connection with the client's case that would not have been
incurred except for representation of that particular client.
To the best of the Debtors' knowledge, Kirkland is a
"disinterested person" within the meaning of Section 101(14) of
the Bankruptcy Code, as required by Section 327(a), and does not
hold or represent an interest adverse to the Debtors' estates.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor.
EDISON MISSION: Wins OK for GCG Inc. as Claims Agent
----------------------------------------------------
Edison Mission Energy, et al., sought and obtained approval to
employ GCG, Inc., as notice, claims and solicitation agent.
GCG will provide certain noticing, claims processing, and
balloting administration services. GCG will also assist with,
among other things, maintaining and updating the master mailing
lists of creditors, gathering data in conjunction with the
preparation of the Debtors' schedules of assets and liabilities,
and tracking and administering claims.
For its noticing services, GCG will charge $50 per 1,000 e-mails,
and $0.10 per page for domestic facsimile. With regards to
document management, GCG will charge $0.12 per image for document
scanning. For claims administration, the firm will charge $0.15
per claim for each association of claimant name and address to the
database. The hourly billing rates of its staff are:
Discounted Rate
---------------
Administrative and Claims Control $45 to $55
Project Administrators $70 to $85
Quality Assurance Staff $80 to $125
Project Supervisors $95 to $110
Systems, Graphic Support & Tech Staff $100 to $200
Project Managers and Senior Project Managers $125 to $175
Directors and Asst. Vice Presidents $200 to $295
Vice Presidents and above $295
The Debtors paid GCG a $750,000 retainer, which was replenished as
appropriate.
GCG has represented that it neither holds nor represents any
interest adverse to the Debtors' estate in connection with any
matter on which it would be employed and that it is a
"disinterested person," as referenced in section 327(a) of the
Bankruptcy Code.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor.
EDISON MISSION: Proposes McDonald Hopkins as Conflicts Counsel
--------------------------------------------------------------
Edison Mission Energy, et al., are seeking to employ McDonald
Hopkins LLC as counsel to debtor Camino Energy Company and as
conflicts counsel to the other Debtors.
The Debtors have tapped Kirkland & Ellis LLP as their lead
restructuring counsel in the Chapter 11 cases. Due to a potential
conflict of interest related to Kirkland and a party potentially
adverse to Camino, the Debtors seek to employ McDonald Hopkins to
represent Camino, as well as to handle other matters that may
arise that may not be handled by Kirkland or the Debtors' other
counsel because of actual or potential conflicts of interest or,
alternatively, matters the Debtors, Kirkland, or the Debtors'
other counsel request be handled by McDonald Hopkins.
McDonald Hopkins' hourly rates, subject to periodic firm-wide
adjustment in the ordinary course of McDonald Hopkins' practice,
are $315 to $690 for members, $330 to $650 for counsel, $200 to
$380 for associates, $155 to $255 for paraprofessionals, and $40
to $140 for law clerks.
As of the Petition Date, McDonald Hopkins holds a $74,332
retainer.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor.
EDISON MISSION: Hiring Perella Weinberg as Investment Banker
------------------------------------------------------------
Edison Mission Energy, et al., seek Bankruptcy Court approval to
hire Perella Weinberg Partners LP as investment banker and
financial advisor.
Perella Weinberg has agreed to provide a variety of services:
* general advisory and investment services, including
reviewing the Debtors' financial condition and prospects;
* restructuring services, including providing strategic advise
with respect to restructuring and refinancing some or all of
the Debtors' obligations, and assisting the Debtors in
negotiations with holders of pass through certificates.
* financing services, including providing financial advise to
the Debtors in structuring and effecting a financing.
* certain sale services, including providing advice in
structuring, evaluating and effecting a sale of the assets.
Perella Weinberg will be compensated for their services, subject
to Court approval, in accordance with this fee structure:
a. Monthly Fee -- An advance monthly fee of $200,000 per month.
b. Financing Fee -- A fee equal to 1% of all of (i) the gross
proceeds of securities of the Debtors sold to any third party,
which third party is not a material existing stakeholder of the
Company as of the Engagement Date, and/or (ii) the principal
amount of each new loan, debt instrument, letter of commitment,
revolver, or similar obligation, in each case sold to or entered
into by a third party that is not a material existing stakeholder
of the Debtors.
c. PoJo Amendment/Restructuring Fee -- In the event of a
Amendment/Restructuring related to Midwest Generation's Powerton
and Joliet Generating Stations in Illinois, Perella Weinberg will
be paid a $2,500,000 fee; provided if the restructuring
constitutes solely an amendment to the documents underlying the
Pass Through Certificates, the PoJo Restructuring Fee will only be
$1,500,000.
d. Restructuring/Sale Fee -- In the case of a Restructuring or
a Sale, a Restructuring Fee of $8,000,000, payable upon (i) the
confirmation of a plan of reorganization with respect to a
Restructuring or (ii) the consummation of a Sale, as applicable.
e. Asset Sale Fee -- In the case of any Asset Sale, fees to be
mutually determined by the Debtors and Perella Weinberg, which
fees would be based on the nature of Perella Weinberg's services
with respect to such Asset Sale, the results obtained and the
custom and practice among investment bankers acting in similar
circumstances.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor.
EDISON MISSION: Wins Approval to Honor PoJo Forbearance Pact
------------------------------------------------------------
Edison Mission Energy and Midwest Generation, LLC, sought and
obtained approval from the Bankruptcy Court to perform under a
forbearance agreement dated as of Dec. 16, 2012, with respect to
obligations related to MWG's Powerton and Joliet Generating
Stations in Illinois (PoJo Facilities).
The PoJo Facilities are two coal-fired electric power generating
plants in Illinois. In 2000, to raise capital, the Debtors
entered into a traditional sale-leaseback transaction. In
exchange for $1.367 billion, MWG transferred title to the PoJo
Facilities, but not the underlying land on which the PoJo
Facilities site, to owner trusts, for the benefit of equity
investors. MWG also leased the underlying land to the owner
trusts, and the owner trusts simultaneously lease the PoJO
Facilities back to MWG for 30 to 33.75 years under facility and
land subleases. The owner trusts, in turn, issued notes that were
secured by the PoJo Facilities pursuant to the lease indentures,
with terms ranging from nine to sixteen years. Pass through
certificates were then issued to the certificate holders through
several pass thorough trusts on terms that generally mirrored the
notes.
The current outstanding principal balance under the Notes is
$345 million. The next payment under the Leases is scheduled to
be made on January 2, 2013, in the amount of $76 million to cover
the preceding six-month period.
The Debtors were concerned that the certificate holders would
allege that the Debtors' chapter 11 filing constitutes a lease
indenture event of default giving rise to the right to accelerate
the Notes. Following arm's length negotiations, the parties
entered into a forbearance agreement.
Pursuant to the Forbearance Agreement, the Certificate Holders and
the Owner Lessors agree, for a period of up to 60 days from the
Petition Date, not to exercise their remedies on account of the
Chapter 11 filing or any default in the payment of principal or
interest owing on the Notes.
The Debtors agree to, among other things, pay the Lease Indenture
Trustee, on the day that is 60 days after the Petition Date, the
ratable portion of the rent due under the Leases attributable to
the period between the Petition Date and Jan. 2, 2013. The
Debtors also agree that the Notes will accrue interest at the
default interest rate starting on the Petition Date.
By entering into the Forbearance Agreement and preserving the
status quo at the PoJo Facilities, the Debtors said they are able
to avert potentially costly and time-consuming litigation that
would have been necessary to avoid the repercussions of an
acceleration.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor.
EDKEY INC: S&P Rates $44MM Series 2012 Revenue Bonds 'BB+'
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' rating to
the Pima County Industrial Development Authority, Ariz.'s $44.3
million series 2012 education facility revenue bonds issued on
behalf of six separate limited liability companies, the sole
member each of which is Edkey Inc. The outlook is stable.
"The rating reflects our view of Edkey's diverse revenue base,
which includes multiple charter schools whose enrollment has
steadily increased during its history, and adequate overall
financial profile," said Standard & Poor's credit analyst Kenneth
Gacka. "While we consider liquidity as sufficient for the rating
in terms of days' cash on hand, we consider the school's cash in
relation to its debt as strained, as is common in the sector,"
continued Mr. Gacka.
"We understand that the proceeds of the series 2012 bonds will be
used to refund three series of existing debt; to acquire certain
properties that are currently being leased; and to fund the
expansion of existing campuses, various renovations, and costs of
issuance. On a pro forma basis, Edkey has $69.7 million of pro
forma long-term debt including the series 2012 bonds. The
remaining debt is primarily the series 2006 bonds (not rated by
Standard & Poor's)," S&P said.
EINSTEIN NOAH: Moody's Withdraws 'B3' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings of Einstein
Noah Restaurant Group Inc., including the company's B3 Corporate
Family Rating following the cancellation of its proposed $25
million senior secured revolving credit facility and $240 million
senior secured term loan issuance.
Ratings Rationale
Ratings withdrawn are:
Corporate Family Rating at B3
Probability of Default Rating at Caa1
$25 million guaranteed senior secured revolver due 2017 at B2
(LGD 3, 30%)
$240 million guaranteed senior secured term loan B due 2018 at
B2 (LGD 3, 30%)
Speculative Grade Liquidity Rating at SGL-2
The principal methodology used in rating Einstein was the Global
Restaurant 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.
Einstein Noah Restaurants Group, Inc. owns, operates, franchises
and licenses bagel bakery cafes in the United States under the
brands Einstein Bros. Bagels, Noah's New York Bagels, and
Manhattan Bagel Company. Annual revenues are approximately $424
million.
EQT CORP: Moody's Reviews '(P)Ba2' Preferred Shelf Rating
---------------------------------------------------------
Moody's Investors Service placed the Baa2 senior unsecured
ratings, the Prime-2 commercial paper rating and other ratings of
EQT Corporation (EQT) under review for downgrade. The outlook was
previously negative. The review was initiated in response to the
company's announcement that it has entered into an agreement to
sell its local distribution company (LDC) subsidiary, Equitable
Gas, and for existing high leverage and challenging fundamentals
in its exploration and production business.
"The announced transaction represents EQT's final step in its long
transition to an independent exploration and production company,"
commented Pete Speer, Moody's Vice President. "EQT's concentration
in natural gas and elevated financial leverage was already
pressuring its Baa2 ratings, so the announced sale of its lower
business risk gas utility operations makes a rating downgrade
likely."
Issuer: EQT Corporation
Senior Unsecured Regular Bond/Debentures, placed on review
for downgrade, currently Baa2
Senior Unsecured Medium-Term Note Program, placed on review
for downgrade, currently (P)Baa2
Commercial Paper, placed on review for downgrade, currently
P-2
Senior Unsecured Shelf, placed on review for downgrade,
currently (P)Baa2
Subordinated Shelf, placed on review for downgrade, currently
(P)Baa3
Junior Subordinated Shelf, placed on review for downgrade,
currently (P)Ba1
Preferred Shelf, placed on review for downgrade, currently
(P)Ba2
Outlook Actions:
Outlook, Changed To Rating Under Review From Negative
Ratings Rationale
EQT's Baa2 ratings reflect the company's very low cost structure
relative to other exploration and production (E&P) peers, enabling
it to generate competitive investment returns in a weak natural
gas price environment. Its credit profile benefits from the
ownership of strategic transportation and storage assets that
enables its growing production to reach the market at low costs.
EQT's rating has also been supported by its LDC operations, which
have provided earnings stability, a lower business risk profile
and knowledge of the local regulatory environment that have
benefited its production and midstream segments. These positive
attributes had served to mitigate the risks of the company's
limited geographic and basin diversification and much smaller
production scale relative to other investment grade rated
independent E&Ps.
The company has announced an agreement to sell its wholly-owned
subsidiary, Equitable Gas, to Peoples Natural Gas in exchange for
$720 million of cash, select midstream assets and commercial
arrangements that are expected to generate at least $40 million of
EBITDA per year. The new midstream assets appear to have a good
strategic fit with EQT's existing midstream business and the cash
will enable the company to continue to fund its production growth.
EQT does not expect to receive the required regulatory approvals
for the sale of Equitable Gas until the end of 2013, but the
company will significantly reduce its dividends starting in
January 2013.
However, the rating outlook for EQT was already negative prior to
this announcement because of its elevated leverage, the execution
risk of its aggressive production growth targets and the adverse
effect of weak natural gas prices on its cash flow coverage of
debt. In addition to losing the benefits of the LDC's lower
business risk profile, this transaction will increase EQT's E&P
leverage metrics since there is no planned debt repayment from the
proceeds of this sale and Moody's had been allocating about $280
million of EQT debt to the LDC.
Moody's ratings review will initially focus on the company's
scale, leverage and return metrics relative to other E&P peers to
determine its fundamental rating positioning in its present
corporate configuration. Moody's will also assess the effect on
EQT's ratings of the planned sale of Equitable Gas. Moody's
expects to complete its ratings review in March 2013 to determine
if a one-notch downgrade is required solely based on the company's
current fundamentals and corporate structure and will at that time
comment further on the potential negative ratings outcomes
resulting from the completion of the Equitable Gas sale.
The principal methodology used in rating EQT was the Global
Independent Exploration and Production Industry Methodology
published in December 2011.
EQT Corporation is headquartered in Pittsburgh, Pennsylvania, and
is engaged in the exploration, production, acquisition, and
exploitation, transportation, and distribution of natural gas.
FIRST WIND: S&P Affirms 'B-' Corp. Credit Rating; Outlook Stable
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit rating on First Wind Capital LLC. The outlook is stable.
The '1' recovery rating on First Wind's $200 million senior
secured notes ($173.8 million outstanding as of Sept. 30, 2012)
remains unchanged.
"The affirmation reflects that although First Wind's application
for a $35 million cash grant was rejected in the third quarter of
2012, its term loan has been extended to November 2015," said
Standard & Poor's credit analyst Grace Drinker. "Although we
expect cash flows to First Wind to decline in 2013 as a result of
the term loan extension, we also expect it will maintain adequate
liquidity and that debt service coverage will remain above 1.0x,"
Ms. Drinker added.
"First Wind is a wholly owned subsidiary of First Wind Holdings,
head of First Wind Group (FW), an independent wind developer with
an open-ended portfolio of wind farms in the northeast and western
U.S. and in Hawaii. KWPII expected to use cash grant to pay off
the remaining $20.5 million bridge loan originally due in November
2012. The cash grant was rejected, however, and the maturity of
the $20.5 million loan has been extended to November 2015," S&P
said.
FPL ENERGY: Fitch Lowers Rating on $365-Mil. Debt to 'BB'
---------------------------------------------------------
Fitch Ratings has downgraded the ratings on FPL Energy National
Wind, LLC's (Opco) $365 million senior secured indebtedness due
2024 to 'BB' from 'BB+' and FPL Energy National Wind Portfolio,
LLC's (Holdco) $100 million senior secured indebtedness due 2019
to 'B-' from 'B'. The downgrades are due to continuing increases
to expenses combined with lower than anticipated wind production,
leading to reduced financial cushion compared to earlier
projections. The Rating Outlook has been revised to Negative from
Stable to reflect the uncertainty regarding the current operating
expense profile and ability to maintain projected availability
levels.
Key Rating Drivers
-- Revenue Shortfalls: Revenues are derived under long-term
contracts for a portfolio of wind projects and are expected
to remain consistent with historical results. These results
have been significantly lower than original projections,
primarily due to lower than projected wind resources at
roughly 6% below original P50 wind. Favorably, lower wind
resources have been partially mitigated by high availability
levels.
-- Increased Costs: Operating and maintenance (O&M) expenses
have persisted well above expectations with an average
increase over the original base case of 46% through 2012.
Expenses are expected to remain near current levels, with an
increase of 6% above prior year budget for 2013. Marginal
increases to O&M have a significant impact on debt service
coverage ratios (DSCRs) due to the decreased cash flow
cushion from revenues.
-- Limited Financial Cushion: Financial performance in recent
years has been lower than projected, and will be subject to
further pressure subsequent to expiration of the production
tax credits (PTC) in 2013. Lower than historical wind
conditions, reduced availability or increases to O&M in any
year may require a draw on reserves, particularly for the
Holdco debt. In the Fitch base case, Opco cash flow is near
the threshold of 1.25x for annual distributions. If cash
flows fall short of this level, Holdco will rely solely on
cash on hand and the one-year debt service reserve (DSR).
What Could Trigger A Rating Action
-- Change in Operating Expenses: Continued increases to the
current O&M budget could further erode cash flow and
negatively impact the rating. Cost containment could
stabilize the rating at the current level.
-- Reduced Availability: A persistent reduction in portfolio
availability from historical levels may result in further
downgrades.
Security
The project debt at the Opco is secured by all tangible and
intangible assets, including real and personal property, a
security interest in all bank accounts, insurance policies, and
project contracts. The project debt at the Holdco is secured by a
first priority pledge of ownership interests and a first priority
security interest in the Holdco accounts and contract rights.
Distributions from the Opco are the Holdco's sole source of
revenues.
Credit Update
Operationally, availability has remained stable overall at 95%
across the portfolio through 2012. Wind production has remained
consistent, albeit at a level less than P50 but greater than P90.
Fitch projected DSCRs are vulnerable to reduced wind resources and
lower availability with escalating expenses for aging assets,
indicative of coverage levels more consistent with lower ratings.
2012 DSCR is estimated at 1.35x at the Opco and 1.17x at the
Holdco, a decrease from the budget, reflecting reduced
availability at the Oklahoma and Sooner projects and increased O&M
due to higher gearbox failure rates. Average project availability
has returned to historical levels while O&M stresses are captured
in the Fitch rating case. Budget 2013 DSCR has been revised
downwards to below 1.30x for the Opco and near breakeven for the
Holdco compared to above 1.40x for each tranche as budgeted in the
prior year.
Currently, the Holdco benefits from a one-year DSR plus additional
cash on hand due to managed distributions by the Sponsor that has
ensured debt repayment through March2013. Current projections
indicate that the projects should have sufficient cushion to cover
the Septepmber 2013 payment as well. If all cash flow ceases to
reach the Holdco level, Fitch expects there will be sufficient
cash to cover a year and a half of debt service through the
September 2014 payment. Two consecutive years of sub 1.25x
coverage at the Opco would trap cash and run down the cash
balances at the Holdco. Under Fitch's rating case which
incorporates low wind conditions as well as availability
reductions and O&M increases in the later years, the Holdco shows
below 1.0x coverage following a cash lock up in 2014 due to sub
1.25x coverage at the Opco and a subsequent rundown of available
liquidity at the Holdco. Future results consistent with the
rating case projections are likely to lead to negative rating
action. Favorably, historical coverage has been relatively stable
at above 1.30x despite wind resource and operating expense
challenges and debt service payments have been sculpted to
decrease following the expiration of PTCs in 2013.
The Opco is a portfolio of nine operating wind farms with an
aggregate capacity of approximately 533.5 MW. Each project
company is wholly owned by the Opco and is otherwise unencumbered
with project-level indebtedness. All of the output of each wind
farm is committed under long term power purchase agreements with
counterparties that are unaffiliated with the Opco. Under the
agreements, the Opco generally receives a fixed-energy price for
all energy produced by the wind farm, and the counterparty
generally pays all costs associated with transmission and
scheduling. Distributions from the Opco are the Holdco's sole
source of revenues. The HoldCo is an indirect, wholly owned
subsidiary of NextEra Energy Capital Holdings, Inc. 'NextEra'
(rated 'A-'/Stable Outlook by Fitch).
FREESEAS INC: Gets Nasdaq Delisting Notice
------------------------------------------
FreeSeas Inc., a transporter of dry-bulk cargoes through the
ownership and operation of a fleet of Handysize and Handymax
vessels, disclosed that it received a letter from the Nasdaq
listing qualifications staff stating that the Company's common
stock will be delisted from the Nasdaq Global Market because the
Company has not, during the 180-day grace period previously
granted by Nasdaq, regained compliance with the Nasdaq continued
listing requirement that the bid price of the Company's common
stock be at least $1.00 per share as set forth in Nasdaq Listing
Rule Section 5450(a)(1). The Company may appeal such decision to a
Nasdaq Hearings Panel within seven days from the date of the
determination letter.
The Company currently intends to appeal such decision and intends
to submit to Nasdaq a plan to regain compliance with such
continued listing requirement. As a result of the submission of
such appeal, the delisting of the Company's common stock from the
Nasdaq Global Market will be stayed until such time as a
determination has been made on the Company's appeal.
The Company's plan of compliance will include, among other things,
plans to consummate the reverse stock split of the Company's
issued and outstanding common stock as approved at the annual
meeting. The Company's board of directors has determined it is in
the Company's and its shareholders' best interest to defer the
consummation of such reverse stock split until such time as it has
formulated a complete plan of compliance to present to the Nasdaq
Hearings Panel. The Company has also applied to list its shares
on the Nasdaq Capital Market, which application has not yet been
approved.
The Company also disclosed that, at the annual shareholders'
meeting, the shareholders elected Xenophon Galinas to the Board of
Directors for three years, approved a reverse split of the
Company's issued and outstanding common stock at a ratio of up to
one for every 12 shares outstanding and ratified the appointment
of Sherb & Co., LLP as the Company's independent registered public
accounting firm for the year ending December 31, 2012.
About FreeSeas Inc.
Headquartered in Athens, Greece, FreeSeas Inc., formerly known as
Adventure Holdings S.A., was incorporated in the Marshall Islands
on April 23, 2004, for the purpose of being the ultimate holding
company of ship-owning companies. The management of FreeSeas'
vessels is performed by Free Bulkers S.A., a Marshall Islands
company that is controlled by Ion G. Varouxakis, the Company's
Chairman, President and CEO, and one of the Company's principal
shareholders.
The Company's fleet consists of six Handysize vessels and one
Handymax vessel that carry a variety of drybulk commodities,
including iron ore, grain and coal, which are referred to as
"major bulks," as well as bauxite, phosphate, fertilizers, steel
products, cement, sugar and rice, or "minor bulks." As of Oct.
12, 2012, the aggregate dwt of the Company's operational fleet is
approximately 197,200 dwt and the average age of its fleet is 15
years.
As reported in the Troubled Company Reporter on July 18, 2012,
Ernst & Young (Hellas) Certified Auditors Accountants S.A., in
Athens, Greece, expressed substantial doubt about FreeSeas'
ability to continue as a going concern, following its audit of the
Company's financial statements for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has
incurred recurring operating losses and has a working capital
deficiency. "In addition, the Company has failed to meet
scheduled payment obligations under its loan facilities and has
not complied with certain covenants included in its loan
agreements with banks."
The Company's balance sheet at June 30, 2012, showed
US$120.8 million in total assets, US$104.1 million in total
current liabilities, and shareholders' equity of US$16.7 million.
GATEHOUSE MEDIA: Bank Debt Trades at 64% Off in Secondary Market
----------------------------------------------------------------
Participations in a syndicated loan under which GateHouse Media,
Inc., is a borrower traded in the secondary market at 36.38 cents-
on-the-dollar during the week ended Friday, Dec. 21, an increase
of 0.23 percentage points from the previous week according to data
compiled by LSTA/Thomson Reuters MTM Pricing and reported in The
Wall Street Journal. The Company pays 200 basis points above
LIBOR to borrow under the facility. The bank loan matures on Feb.
27, 2014, and carries Moody's Ca rating and Standard & Poor's CCC-
rating. The loan is one of the biggest gainers and losers among
197 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About GateHouse Media
GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications. GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.
Gatehouse Media, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $9.41 million on $120.79 million of total revenues for the
three months ended Sept. 30, 2012, compared with a net loss of
$5.16 million on $125.02 million of total revenues for the three
months ended Sept. 25, 2011.
For the nine months ended Sept. 30, 2012, the Company reported a
net loss of $25.65 million on $365.39 million of total revenues,
in comparison with a net loss of $28.42 million on $374.95 million
of total revenues for the nine months ended Sept. 25, 2011.
The Company's balance sheet at Sept. 30, 2012, showed
$480.43 million in total assets, $1.30 billion in total
liabilities, and a $829.10 million total stockholders' deficit.
The Company reported a net loss of $22.22 million for the year
ended Jan. 1, 2012, a net loss of $26.64 million for the year
ended Dec. 31, 2010, and a net loss of $530.61 million for the
year ended Dec. 31, 2009.
Bankruptcy Warning
According to the Form 10-K for the year ended Dec. 31, 2011, the
Company's ability to make payments on its indebtedness as required
depends on its ability to generate cash flow from operations in
the future. This ability, to a certain extent, is subject to
general economic, financial, competitive, legislative, regulatory
and other factors that are beyond the Company's control.
There can be no assurance that the Company's business will
generate cash flow from operations or that future borrowings will
be available to the Company in amounts sufficient to enable it to
pay its indebtedness or to fund our other liquidity needs.
Currently the Company does not have the ability to draw upon its
revolving credit facility which limits its immediate and short-
term access to funds. If the Company is unable to repay its
indebtedness at maturity the Company may be forced to liquidate or
reorganize its operations and business under the federal
bankruptcy laws.
GEOKINETICS INC: Receives Delisting Notice From NYSE MKT
--------------------------------------------------------
Geokinetics, Inc. disclosed that on Dec. 18, 2012, the Company
received a delisting notice from the NYSE MKT LLC. The Company
does not intend to appeal the Exchange's decision to delist the
Company's common stock.
The Exchange also notified the Company that it was not in
compliance with Section 1003(a)(iv) of the Exchange's Company
Guide. The Exchange had previously notified the Company that it
was not in compliance with Section 1003(a)(i) or Section
1003(a)(ii) of the Company Guide.
Trading in the Company's common stock will be suspended from the
Exchange prior to the opening of business on Dec. 27, 2012 and the
Exchange will file a Form 25-NSE with the SEC to remove the
Company's common stock from listing and registration on the
Exchange. The Company's common stock has been subject to a
trading halt by the Exchange since Dec. 17, 2012, and the Company
does not expect the trading halt to be lifted prior to the
delisting of the common stock.
The Company's common stock will not immediately be eligible for
quoting on the over-the counter market, including the Over the
Counter Bulletin Board or OTC Markets Group OTCQB, unless a market
maker decides to quote the common stock and files a Form 211 with
the Financial Industry Regulatory Authority ("FINRA") and FINRA
approves the Form 211. The Company intends to seek a market maker
to file a Form 211 with FINRA. However, there can be no
assurances that any market maker will decide to quote the
Company's common stock and submit the Form 211 to FINRA or that
FINRA will approve the Form 211.
About Geokinetics
Headquartered in Houston, Texas, Geokinetics Inc., a Delaware
corporation founded in 1980, is provides seismic data acquisition,
processing and integrated reservoir geosciences services, and
land, transition zone and shallow water OBC environment
geophysical services. These geophysical services include
acquisition of 2D, 3D, time-lapse 4D and multi-component seismic
data surveys, data processing and integrated reservoir geosciences
services for customers in the oil and natural gas industry, which
include national oil companies, major international oil companies
and independent oil and gas exploration and production companies
worldwide.
The Company's balance sheet at June 30, 2012, showed
$410.85 million in total assets, $580.10 million in total
liabilities, $88.19 million of Series B-1 Senior Convertible
Preferred Stock, and a stockholders' deficit of $257.44 million.
* * *
In the Oct. 5, 2011, edition of the TCR, Moody's Investors Service
downgraded Geokinetics Holdings, Inc.'s (Geokinetics) Corporate
Family Rating (CFR) and Probability of Default Rating (PDR) to
Caa2 from B3.
"The downgrade to Caa2 is driven by Geokinetics' lower than
expected margins in its international markets, constrained
liquidity and weak leverage metrics," commented Andrew Brooks,
Moody's Vice-President. "The negative outlook highlights the
company's continuing tight liquidity and weak financial metrics
even in an improved oil and gas operating environment."
As reported by the TCR on Oct. 3, 2011, Standard & Poor's Ratings
Services lowered its corporate credit and senior secured ratings
on Geokinetics Holdings Inc. (Geokinetics) to 'CCC+' from 'B-'.
The rating action reflects uncertainty surrounding the costs,
damage to reputation, and effect on operations following a
liftboat accident in the Southern Gulf of Mexico that led to four
fatalities, including two Geokinetics employees and two
subcontractors.
GEOMET INC: Bank Lenders Keep $115 Million Commitment
-----------------------------------------------------
GeoMet, Inc., said the Company's bank group approved continuing
the Company's borrowing base at $115 million. The next regularly
scheduled borrowing base determination will be by June 15, 2013,
based on the Dec. 31, 2012, reserve report as prepared by
independent reserve engineers.
The Company expects to reduce its borrowings under its credit
agreement by an additional $1.8 million by the end of the year.
Including this expected payment, the Company will have reduced its
bank debt in 2012 by $18.6 million.
The Company projects that $139.3 million will be drawn under its
credit agreement as of Dec. 31, 2012, resulting in a borrowing
base deficiency of $24.3 million. The Company also expects to
continue to make monthly bank debt reductions aggregating not less
than $10.3 million in 2013, consistent with the requirements of
the credit agreement.
About Geomet Inc.
Houston, Texas-based GeoMet, Inc., is an independent energy
company primarily engaged in the exploration for and development
and production of natural gas from coal seams (coalbed methane)
and non-conventional shallow gas. Its principal operations and
producing properties are located in the Cahaba and Black Warrior
Basins in Alabama and the central Appalachian Basin in Virginia
and West Virginia. It also owns additional coalbed methane and
oil and gas development rights, principally in Alabama, Virginia,
West Virginia, and British Columbia. As of March 31, 2012, it
owns a total of 192,000 net acres of coalbed methane and oil and
gas development rights.
"As of May 11, 2012, we had $148.6 million outstanding under our
Fifth Amended and Restated Credit Agreement," the Company said in
its quarterly report for the period ending March 31, 2012. "As of
March 31, 2012, we were in compliance with all of the covenants in
our Credit Agreement. The Credit Agreement provides, however,
that if the amount outstanding at any time exceeds the 'borrowing
base', we must provide additional collateral to the lenders or
repay the excess as provided in the Credit Agreement. The
borrowing base is set in the sole discretion of our lenders in
June and December of each year based, in part, on the value of our
estimated reserves as determined by the lenders using natural gas
prices forecasted by the lenders."
"Due to the decline in the bank group's price projections, we
expect our outstanding loan balance at the June determination date
will exceed the new borrowing base, resulting in a borrowing base
deficiency. We do not have additional collateral to provide to
the lenders and we expect that our operating cash flows would be
insufficient to repay the expected borrowing base deficiency, as
required under the Credit Agreement. As such, unless we amend the
Credit Agreement, we may be in default under the agreement when
the borrowing base is determined in June 2012. In addition, the
elimination of the unused availability under the borrowing base,
which is a factor in our working capital covenant, may result in a
future default of that covenant under the Credit Agreement."
The Company said it has begun discussions with its bank group.
According to the Company, "Until the borrowing base for June 2012
has been determined, we will not know the amount of the
deficiency. As of March 31, 2012, the debt is classified as long-
term as we are not in violation of any debt covenants. Should we
be in violation of any covenants which have not been waived or
have a borrowing base deficiency as of June 30, 2012, some or all
of the debt will be reclassified to current. There are no
assurances that we will be able to amend our Credit Agreement or
obtain a waiver. If we do obtain a waiver or an amendment, there
can be no assurance as to the cost or terms of such an amendment."
"These conditions raise substantial doubt about our ability to
continue as a going concern for the next twelve months."
The Company's balance sheet at Sept. 30, 2012, showed
$108.08 million in total assets, $171.67 million in total
liabilities, $33.28 million in mezzanine equity, and a $96.86
million total stockholders' deficit.
GFI GROUP: S&P Lowers Issuer Credit Rating to 'BB-'; Outlook Neg
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its issuer credit and
senior unsecured ratings on GFI Group Inc. to 'BB-' from 'BB+'.
The outlook on the issuer credit rating is negative.
Standard & Poor's ratings on GFI reflect the company's position as
a small firm in the intensely competitive, low-margin, and
relatively narrow institutional agency brokerage business. The
company relies on market-dependent trading volumes to generate
revenues.
"The rating actions reflect our view that GFI's generally accepted
accounting principles profits and voice brokerage revenues are
under pressure as a result of lower industrywide trading volumes,"
said Standard & Poor's credit analyst Kenneth Frey. Lower volumes
result from reduced investor risk appetite and reduced trading at
large marketmaking investment banks. "We expect lower volumes to
continue through 2013."
"In the year-to-date ended Sept. 30, 2012, the company's total
brokerage revenues were down 12% from the same time last year,
with fixed income and equity trading down 20% and 24%,
respectively. However, we do note third-quarter 2011 was a good
quarter for GFI. While electronic trading and market data revenues
were up 13%, this segment is only a fraction of GFI's total
revenues," S&P said.
"Looking forward, new regulation such as the Volcker Rule could
potentially increase revenue growth through the expansion of GFI's
customer base if marketmaking activities are disintermediated from
larger brokers to smaller agency brokers, including GFI. However,
increased revenues won't necessarily lead to better credit
protection measures unless profits improve," S&P said.
"The negative outlook reflects our view that GFI will have
difficulties improving its credit measures in competitive and
volatile trading conditions," said Mr. Frey. "We could lower the
ratings if we believe GFI's credit measures won't improve over the
next 12 months or if liquidity is materially reduced. We expect
the firm's GAAP EBITDA to interest to improve to 4.0x, its debt to
GAAP EBITDA to decrease to about 3.0x, and cash to be conserved at
current levels. We could revise the outlook to stable if GFI meets
or exceeds our credit measure expectations and business conditions
stabilize over time," S&P said.
GLOBALSTAR INC: Delisted From NASDAQ Stock Market
-------------------------------------------------
Globalstar, Inc. received notice from the Listing Qualifications
Department of the NASDAQ Stock Market (NASDAQ) that Globalstar's
common stock would be delisted effective at the opening of
business on Friday, Dec. 21, 2012. NASDAQ is taking this action
due to the Company's common stock trading below the minimum bid
price of $1.00 in excess of the period permitted by NASDAQ listing
rules.
In September 2011, NASDAQ notified the Company that its common
stock was no longer in compliance with the minimum $1.00 per share
bid price requirement for continued listing. As a result of an
appeal initiated by the Company, the period for compliance was
extended and any delisting was deferred. Globalstar recently
requested a further extension of the compliance period and a
deferral of delisting, which was declined by NASDAQ in the notice
received on Dec. 19, 2012.
Effective Friday, Dec. 21, 2012, the Company anticipated that its
common stock will trade over the counter (OTC) under its current
symbol, GSAT.
Jay Monroe, Chairman and CEO of Globalstar, Inc., stated, "The
board of directors carefully deliberated, over an extended period
of time, the advantages and disadvantages of effecting a reverse
stock split in order to seek to regain compliance with NASDAQ's
listing qualifications, and decided that doing so was not in the
Company's or its stockholders' best interests at this time. We
remain keenly focused on the execution of our satellite
communications and spectrum strategies to drive stockholder value,
including completing our fourth Second-Generation satellite
launch. We fully intend to seek listing on an accredited exchange
as soon as it is feasible to do so."
About Globalstar, Inc.
Globalstar provides mobile satellite voice and data services.
Globalstar offers these services to commercial and recreational
users in more than 120 countries around the world.
GRANITE DELLS: Debtor, Tri-City Refrain From Soliciting Plan Votes
------------------------------------------------------------------
Granite Dells Ranch Holdings, LLC, et al., Arizona Eco Development
LLC, Tri-City Investment & Development, LLC, and the Ad Hoc
Committee of Note Holders entered into a stipulation to
temporarily stay litigation and solicitation on the competing
Chapter 11 plans filed by the Debtor and Tri-City.
On Dec. 7, the Ad Hoc Committee of Note Holders and Arizona Eco
Development filed a Disclosure Statement explaining their own
Joint Plan of Reorganization.
The stipulation provides for, among other things:
1. Until the Jan. 9, 2013 hearing on the Disclosure Statement
explaining the Chapter 11 Plan dated Dec. 4, 2012, proposed by the
Ad Hoc Committee of Note Holders and Arizona Eco Development LLC,
Tri-City and the Debtors agree to refrain from soliciting votes
for their respective plans.
2. The Debtors and Arizona Eco agree to stay and continue all
associated deadlines related to the pending appeal and adversary
proceedings between the Debtors and Arizona Eco for 60 days from
the date of the stipulation. The stipulation extends to pending
litigation and deadlines associated with these matters:
a. Granite Dells Ranch Holdings, LLC v. Arizona Eco
Development LLC, No. 2:12-ap-01515-RTBP (Bankr. D. Ariz. Aug. 24,
2012);
b. Granite Dells Ranch Holdings, LLC v. Arizona Eco
Development LLC, No. 3:12-cv-08217-PCT-SLG (D. Ariz. Oct. 26,
2012);
c. Granite Dells Ranch Holdings, LLC v. Robert Stuart
Swanson; Jason J. Gisi; Michael W. Fann, No. 2:12-ap-01519-RTBP
(Bankr. D. Ariz. Aug. 24, 2012);
d. Granite Dells Ranch Holdings, LLC v. Robert Stuart
Swanson; Jason J. Gisi; Michael W. Fann, No. 3:12-cv-08218
(D. Ariz. Oct. 26, 2012); and
e. Arizona Eco Development LLC v. Granite Dells Ranch
Holdings, LLC, No. 3:12-cv-08230-PCT-SLG.
Arizona Eco and Ad Hoc Committee's Plan
Arizona Eco is the holder of secured and unsecured debt of GDRH,
debtor. The Note Holders Committee is an unofficial committee
consisting of the following persons: Chris Allen, Greg Stanford,
Brad Routh, David Rosenthal, Joe Guglielmi, Robert Seaton, and
Robert Olson. The Note Holders Committee represents the interests
of persons who purchased convertible promissory notes of Debtor.
The Joint Plan proposes that two parcels of real property, a 108-
acre parcel and a 17-acre parcel, along with all related rights
and interests, will be transferred free and clear of all liens,
claims, and encumbrances to a new entity, NH Co. LLC, which will
be owned entirely by the Note Holders, subject only to certain
limitations.
Each Note Holder will have a right of first refusal, ahead of
Arizona Eco, to purchase any other Note held by any other Note
Holder and the distributions to be made to that Note Holder under
this Joint Plan on first come first served basis.
The Note Holders Committee and Arizona Eco have agreed that
Arizona Eco and NH Co. LLC will share the responsibility for any
deficit to pay the Allowed Administrative Claims of the estate,
with Arizona Eco to be responsible to pay 65% of that amount and
NH Co. LLC to be responsible to pay 35% of that amount, with a cap
in the amount of $450,000 on the amount allocated to be paid by NH
Co. LLC. Arizona Eco has agreed to advance the funds necessary to
pay the portion of Allowed Administrative Claims allocable to NH
Co. LLC.
All other general Unsecured Claims will be paid 10% of their
principal amount if or when Allowed by a Final Order of the Court,
and Claims will be paid when finally Allowed; however, Arizona Eco
agrees as part of the proposed Joint Plan to not assert any
unsecured deficiency Claim in the General Unsecured Class, except
as a set-off against any Claim held by any member of the Cavan
Group.
The operating agreement of NH Co. LLC will contain a provision
stating that a majority of Note Holders not affiliated with
Arizona Eco, the Cavan Group, and the Debtor will be required to
approve the sale of land owned by NH Co. LLC.
The equity interests are terminated under the Joint Plan and do
not receive payment.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/GRANITE_DELLS_ds_committee.pdf
Debtors' Plan
As reported by the Troubled Company Reporter on Nov. 6, 2012, the
Debtors filed with the Court a consolidated disclosure statement
explaining their proposed Plan of Reorganization dated Sept. 26,
2012. The Plan provides for payment to unsecured creditors
(including any unsecured claim of AED) in quarterly installments
over eight years aggregating $5 million. However, the Plan
provides that a holder of an investment promissory note (estimated
to total $21 million) will be given the option of participating in
the funding of the Reorganized Debtor. A holder of an Investor
Claim who elects to participate in the funding will become a
member with a share of profits pro rated among all new equity
contributors. An electing holder of an Investor Claim will also
participate in distributions with other unsecured creditors, based
on the amount of accrued and unpaid interest such holder is owed.
The Plan provides that each existing member and holder of an
interest in Debtor will retain its interests in the Reorganized
Debtor only if such holder participates in the funding of
additional equity. The Plan also provides that each member of a
Direct Equity Holder will be given the opportunity to participate
in the funding of the Reorganized Debtor to the extent its Direct
Equity Holder does not elect to participate.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/GRANITE_DELLS_ds.pdf
Tri-City's Proposed Plan
On Dec. 7, Tri-City, a 39.25% equity holder in the Debtor, filed
an amended consolidated supplemental disclosure in support of
Tri-City's Plan as amended. Tri-City's Consolidated Disclosure
Statement incorporates and restates all material terms of the
Tri-City's previous disclosure statements.
Tri-City said its consolidated disclosure is to alert all
interested parties to the agreement that was reached at mediation
on Aug. 20, 2012, which terms are being incorporated into the
Amended Plan between Arizona ECO Development, L.L.C., and Tri-
City. The Amended Plan provides a path for confirmation that
avoids prolonged litigation, foreclosure of the Debtor's real
property, and mitigates tax consequences.
Tri-City's proposed plan of reorganization provides a path to
recovery for all creditors by settling potential claims, but does
not require any cash contributions. Tri-City's Plan proposes to
retain a portion of the Debtor's property in Chino Valley and also
a controlling interest in the Bright Star Development in Chino
Valley. This provides the Reorganized Debtor with both an
interest in immediate developable land to create cash flow and an
interest in property that has longer term growth possibilities.
Additionally, Tri-City will receive a note payable to cover
development and the future administrative expenses of the
Reorganized Debtor.
A copy of the Amended Disclosure Statement is available for free
at http://bankrupt.com/misc/GRANITE_DELLS_ds_tri-city_amended.pdf
About Granite Dells
Scottsdale, Arizona-based Granite Dells Ranch Holdings LLC filed a
bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-04962)
in Phoenix on March 13, 2012. Judge Redfield T. Baum PCT Sr.
oversees the case. The Debtor is represented by Alan A. Meda,
Esq., at Stinson Morrison Hecker LLP. The Debtor disclosed
$2.22 million in assets and $157 million in liabilities as of the
Chapter 11 filing.
Cavan Management Services, LLC is the Debtor's manager. David
Cavan, member of the firm, signed the Chapter 11 petition.
Arizona ECO Development LLC, which acquired a $83.2 million 2006
loan by the Debtor, is represented by Snell & Wilmer L.L.P. The
resolution authorizing the Debtor's bankruptcy filing says the
Company is commencing legal actions against Stuart Swanson, AED,
and related entities relating to the purchase by Mr. Swanson of a
promissory note payable by the Company to the parties that sold a
certain property to the Company. According to Law 360, AED sued
Granite Dells on March 6 asking the Arizona court to appoint a
receiver. Arizona ECO is foreclosing on a secured loan backed by
15,000 acres of Arizona land.
The United States Trustee said that an official committee has not
been appointed in the bankruptcy case of Granite Dells because an
insufficient number of unsecured creditors have expressed interest
in serving on a committee.
The Debtor's Plan provides for payment to unsecured creditors
(including any unsecured claim of AED) in quarterly installments
over eight years aggregating $5 million. However, the Plan
provides that a holder of an investment promissory note (estimated
to total $21 million) will be given the option of participating in
the funding of the Reorganized Debtor.
Tri-City Investment & Development, LLC, a 39.25% equity holder in
the Debtor, also filed a Consolidated Supplemental Disclosure in
support of Tri-City's Plan, as amended. Tri-City's consolidated
Disclosure Statement incorporates and restates all material terms
of the Tri-City's previous disclosure statements and incorporates
the terms of the agreement that was reached at the Aug. 20, 2012,
mediation.
GRANITE DELLS: Jan. 15 Set as Deadline for 2012 Admin. Claims
-------------------------------------------------------------
The Hon. Redfield T. Baum of the U.S. Bankruptcy Court for the
District of Arizona, according to the minutes of a Dec. 6 hearing,
established Jan. 15, 2013, as the last day to file all 2012
administrative claims against Granite Dells Ranch Holdings LLC.
Scottsdale, Arizona-based Granite Dells Ranch Holdings LLC filed a
bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-04962)
in Phoenix on March 13, 2012. Judge Redfield T. Baum PCT Sr.
oversees the case. The Debtor is represented by Alan A. Meda,
Esq., at Stinson Morrison Hecker LLP. The Debtor disclosed
$2.22 million in assets and $157 million in liabilities as of the
Chapter 11 filing.
Cavan Management Services, LLC is the Debtor's manager. David
Cavan, member of the firm, signed the Chapter 11 petition.
Arizona ECO Development LLC, which acquired a $83.2 million 2006
loan by the Debtor, is represented by Snell & Wilmer L.L.P. The
resolution authorizing the Debtor's bankruptcy filing says the
Company is commencing legal actions against Stuart Swanson, AED,
and related entities relating to the purchase by Mr. Swanson of a
promissory note payable by the Company to the parties that sold a
certain property to the Company. According to Law 360, AED sued
Granite Dells on March 6 asking the Arizona court to appoint a
receiver. Arizona ECO is foreclosing on a secured loan backed by
15,000 acres of Arizona land.
The United States Trustee said that an official committee has not
been appointed in the bankruptcy case of Granite Dells because an
insufficient number of unsecured creditors have expressed interest
in serving on a committee.
The Debtor's Plan provides for payment to unsecured creditors
(including any unsecured claim of AED) in quarterly installments
over eight years aggregating $5 million. However, the Plan
provides that a holder of an investment promissory note (estimated
to total $21 million) will be given the option of participating in
the funding of the Reorganized Debtor.
Tri-City Investment & Development, LLC, a 39.25% equity holder in
the Debtor, also filed a Consolidated Supplemental Disclosure in
support of Tri-City's Plan, as amended. Tri-City's consolidated
Disclosure Statement incorporates and restates all material terms
of the Tri-City's previous disclosure statements and incorporates
the terms of the agreement that was reached at the Aug. 20, 2012,
mediation.
HAYDEL PROPERTIES: Taps Kenneth Jones as Real Estate Broker
-----------------------------------------------------------
Haydel Properties, LP, has sought authorization from the U.S.
Bankruptcy Court for the Southern District of Mississippi to
employ Kenneth Jones as real estate broker.
Kenneth Jones will, among other things, list for sale, market and
sell real property of the Debtor so that the proceeds may be used
to reorganize the debts. The terms of employment agreed between
Kenneth Jones and the Debtor, subject to approval by the Court, is
8% of the gross sale price of each property sold, to be paid at
closing by the Debtor, after the sale is approved by the Court.
To the best of the Debtor's knowledge, Kenneth Jones is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The Court has set for Jan. 10, 2013, at 1:30 p.m., the hearing on
the Debtor's request to employ Kenneth Jones.
Haydel Properties LP, based in Biloxi, Mississippi, filed for
Chapter 11 bankruptcy (Bankr. S.D. Miss. Case No. 12-50048) on
Jan. 11, 2012. Judge Katharine M. Samson presides over the case.
Christy Pickering serves as accountant. The Debtor disclosed
$11.7 million in assets and $6.8 million in liabilities as of the
Chapter 11 filing.
HOLLIFIELD RANCHES: Has Nod to Hire Richard Martella as Auctioneer
------------------------------------------------------------------
Hollifield Ranches, Inc., sought and obtained authorization from
the U.S. Bankruptcy Court for the District of Idaho to employ
Richard Martella at A & M Livestock Auction as auctioneer for
approximately 4,000 head (more or less) of dairy cows, which
number possibly may include approximately 600 head (more or less)
of Holstein steers.
Mr. Martella will be paid a commission of 4% of the gross amount
of money received at sale. The auctioneer will pay the cost of
advertising.
In addition to payment of the auctioneer's commission, the Debtor
has agreed to pay actual costs associated with preparing the
livestock for sale including, but not limited to, feeding, preg
checking, and TB testing. The Debtor will also assume and pay the
costs of any other veterinary services that are necessary to
ensure the animals are sound and of good quality, as well as the
cost of the required brands inspections.
To the best of the Debtor's knowledge, Mr. Martella is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Mr. Martella can be reached at:
A & M Livestock Auction
Highway 43 & Houston Avenue
P.O. Box 96
Hanford, CA 93232
About Hollifield Ranches
Hansen, Idaho-based Hollifield Ranches Inc. filed for Chapter 11
bankruptcy (Bankr. D. Idaho Case No. 10-41613) on Sept. 9, 2010.
Hollifield Ranches owns a farming, cattle and dairy operation, and
allegedly is owed money for potatoes it sent to Cummins Family
Produce, Inc., for processing. Brent T. Robinson, Esq., in
Rupert, Idaho, represents the Debtor. The Debtor estimated assets
and debts at $10 million to $50 million as of the Chapter 11
filing.
The Debtor, which is run by Terry Hollifield, was forced to seek
bankruptcy after its dairy business encountered cash flow problems
in 2008 when the cost of feed was very high, and its cattle
business had problems with the falling price for livestock.
J. Justin May, Esq., at May, Browning & May, represents the
Official Committee of Unsecured Creditors.
HOTELS USA: Case Summary & 15 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Hotels USA of Virginia, Inc.
6323 Ritchie Highway
Glen Burnie, MD 21061
Bankruptcy Case No.: 12-51959
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Eastern District of Virginia (Newport News)
Judge: Stephen C. St. John
Debtor's Counsel: Karen M. Crowley, Esq.
CROWLEY, LIBERATORE, RYAN & BROGAN, P.C.
Town Point Center, Suite 300
150 Boush Street
Norfolk, VA 23510
Tel: (757) 333-4500
Fax: (757) 333-4501
E-mail: kcrowley@clrbfirm.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 15 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/vaeb12-51959.pdf
The petition was signed by Dipen Patel, vice president.
HOUSE OF RHEMA: Case Summary & Largest Unsecured Creditor
---------------------------------------------------------
Debtor: House of Rhema Full Gospel Baptist Church
2802 E South Mountain Ave
Phoenix, AZ 85042
Bankruptcy Case No.: 12-26667
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Sarah Sharer Curley
Debtor's Counsel: Michael T. Reynolds, Esq.
REYNOLDS & REYNOLDS, PLLC
125 E. Coronado Rd.
Phoenix, AZ 85004
Tel: (602) 253-6141 ext 203
Fax: (602) 252-4133
E-mail: michael@reynoldsazlaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
In its list of 20 largest unsecured creditors, the Company
disclosed one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
First Citizen $530,000
DAC 15
PO Box 27131
Raleigh, NC 27611
The petition was signed by James R. Cockerhern, president.
HUNTER FAN: S&P Raises Ratings on $125MM Secured Credit to 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its issue-level ratings
on Hunter Fan Co.'s proposed $125 million (reduced from $142
million previously) senior secured first-lien credit facilities
due 2017 by one notch to 'B+' from 'B'. "We also revised the
recovery rating on this debt to '1' from '2', indicating our
expectations for very high (90% to 100%) recovery in the event of
a payment default. This facility now consists of a $25 million
revolving credit facility and a $100 million (reduced from $117
million) term loan. The recovery rating revision reflects the
reduction of the company's proposed first-lien credit facilities,
which we believe has improved the recovery prospects for this
debt," S&P said.
"At the same time, we assigned a 'CCC' issue-level rating to
Hunter Fan's proposed $55 million senior secured second-lien term
loan due 2018. The recovery rating is '6', indicating our
expectation for negligible (0% to 10%) recovery in the event of a
payment default. Hunter Fan plans to use the proceeds from this
debt offering to repay the existing balances on its $160 million
term loan B due 2014, $60 million second-lien term loan due 2014,
and $34 million revolving credit facility due 2013. We will
withdraw the issue-level ratings on the company's existing senior
secured term loans and revolver upon completion of this
transaction and after existing balances have been repaid," S&P
said.
"The 'B-' corporate credit rating on Hunter Fan Co. remains
unchanged. The outlook remains positive, reflecting the extension
of maturities, improved covenant cushion and liquidity from the
proposed refinancing transaction, and our expectation that the
company will continue to improve operating performance and reduce
debt over the next year. For the 12 months ended July 31, 2012,
adjusted leverage declined to 5.6x, from 6.2x for the prior-year
period on improved profitability and debt reduction, and we
estimate leverage will remain close to this level pro forma for
this refinancing. We could raise the ratings over the next 12
months if operating performance strengthens and credit measures
continue to improve, including adjusted leverage reduced to and
sustained below 5.5x," S&P said.
"The ratings on Hunter Fan Co. reflect Standard & Poor's view the
company will continue to have a 'highly leveraged' financial risk
profile, given its significant debt obligations. Key credit
factors considered in our assessment of Hunter's 'vulnerable'
business risk profile include its narrow business focus and
significant customer concentration. Our business risk assessment
also factors in the company's well-recognized brands and strong
market position within the domestic branded ceiling-fan category.
We view Hunter's management and governance to be 'fair,'" S&P
said.
RATINGS LIST
Hunter Fan Co.
Corporate credit rating B-/Positive/--
Issue Ratings Raised; Recovery Ratings Revised
To From
Hunter Fan Co.
Senior secured
$25 mil. revolver due 2017 B+ B
Recovery rating 1 2
$100 mil. term loan due 2017 B+ B
Recovery rating 1 2
Ratings Assigned
Hunter Fan Co.
Senior secured
$55 mil. second-lien term loan
due 2018 CCC
Recovery rating 6
IAP WORLDWIDE: S&P Raises Corporate Credit Rating to 'CCC+'
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Cape Canaveral, Fla.-based IAP Worldwide Services Inc.
to 'CCC+' from 'SD'. The outlook is developing.
"The rating action reflects our expectation that credit measures
will remain very weak for at least the next year and that
sustainable improvement will be subject to external factors, such
as declining government defense spending and management's ability
to diversify into adjacent services," said Standard & Poor's
credit analyst Dan Picciotto. "The recent amendment and extention
of the company's credit facilities by three years affords some
time for management to execute its strategy, which includes
increasing penetration outside of its traditional U.S. government
customers."
"Although the transaction was not a deleveraging event, the post-
exchange capital structure alleviates IAP's near-term debt
maturities as the first-lien credit facility was due to expire at
the end of this year. However, we still consider IAP's financial
risk profile to be 'highly leveraged' with adjusted debt to EBITDA
likely to exceed 7x at year-end," S&P said.
"The ratings on IAP also reflect our view of the company's
business risk profile as 'vulnerable.' The business is marked by
inherent risks associated with contract bidding, fixed price
contract execution, a competitive landscape, and the less-
predictable nature of contingency operations. We believe potential
cuts in federal defense spending, given current deficit-reduction
efforts, present risks to demand for IAP's services over time.
Although the company has historically had a good rebid record on
contracts and low fixed capital requirements, we believe its
EBITDA margin will remain thin at less than 10%, which is
consistent with a highly competitive market for its services.
"In addition, we score IAP's management and governance as 'weak,'
mainly because of our negative view on the company's controlling
ownership, which we believe has engaged in very aggressive
financial policy since 2005 that promotes the owners interests
above those of other stakeholders. We maintain this assessment in
spite of the fact that the controlling shareholder, Cerberus, does
not control a majority of the company's board seats and our view
that the company's relatively new management team is pursuing a
necessary strategy to diversify its revenue streams to offset the
likely reduction of work in war theatres over time. However, the
ability of IAP's management teams to meet budgeted levels of
operating performance since 2005 has been spotty," S&P said.
"Despite the recent refinancing, we assess the company's liquidity
as 'less than adequate' under our criteria because of potentially
tight covenant headroom and our view that the company does not
have the capacity to absorb low probability adversities," S&P
said.
"The outlook is developing. We could raise the rating if we expect
IAP to maintain debt to EBITDA of about 5x or less, generate
positive free cash flow, and have a greater degree of comfort that
capital markets would be open and available to refinance the
company's 2015 maturities. We believe successful execution of the
company's strategy to enter adjacent markets could lead to this
outcome. We could lower the rating if covenant headroom remains
less than 10% or if free cash flow generation becomes negative,"
S&P said.
INTELLICEL BIOSCIENCES: Raises $250,000 From Securities Sale
------------------------------------------------------------
Intellicell Biosciences, Inc., entered into a securities purchase
agreement pursuant to which the Company sold the investor 833,333
units, each unit consisting of two shares of the Company's common
stock, par value $0.001 per share, and a warrant to purchase a
share of common stock, for aggregate gross proceeds of $250,000.
The Warrant is exercisable for a period of five years from the
date of issuance at an initial exercise price of $0.45, subject to
adjustment. The exercise price of the Warrant is subject to
customary adjustments for stock splits, stock dividends,
recapitalizations and the like.
The investor has contractually agreed to restrict its ability to
exercise the Warrant such that the number of shares of the Company
Common Stock held by the investor and its affiliates after that
exercise does not exceed 9.99% of the Company's then issued and
outstanding shares of Common Stock.
J. Pavia Appointed Director
On Nov. 30, 2012, the Company's board of directors appointed John
P. Pavia III as a director of the Company, effective immediately,
increasing the size of the board of directors to five members.
Mr. Pavia does not have any family relationship with any director,
executive officer or person nominated or chosen by the Company to
become a director or executive officer. Mr. Pavia has not entered
into any material plan, contract or arrangement in connection with
his appointment as director.
Since January 2008, Mr. Pavia has served as the Senior Vice
President of Corporate Development & Chief Counsel of Hartford-
based FM Facility Maintenance, a full service maintenance company.
From October 2006 until December 2007, Mr. Pavia served as the
founding partner and Executive Managing Director of Siena Lane
Partners, LLC, an advisory group that assists small and medium
sized companies with devising and implementing growth strategies.
From 2002 until September 2006, Mr. Pavia served as vice
president, deputy general counsel and assistant secretary of RR
Donnelley & Sons after joining the management team that took
control of Moore Corporation Ltd. in late 2000.
Mr. Pavia was a director of Sionix Corporation, a NASDAQ-listed
company, from July 2008 to May 2010 and a director of RedRoller
Holdings, Inc., an OTCBB quoted company, from December 2007 until
December 2008. Mr. Pavia attended American University School of
Law and later clerked for U.S. District Judge Robert Zampano. He
served as an Assistant District Attorney in Brooklyn from 1992 to
1995 and later became a partner at the law firm of Levy & Droney,
where he worked from 1995 to 1999. Mr. Pavia has been associated
with Quinnipiac University School of Law since 1990 as an adjunct
professor. Mr. Pavia is also the Finance Chairman of the
Connecticut Republican Party.
About Intellicell Biosciences
Intellicell BioSciences, Inc., headquartered in New York, N.Y.,
was formed on Aug. 13, 2010, under the name "Regen Biosciences,
Inc." as a pioneering regenerative medicine company to develop and
commercialize regenerative medical technologies in large markets
with unmet clinical needs. On Feb. 17, 2011, the company changed
its name from "Regen Biosciences, Inc." to "IntelliCell
BioSciences Inc". To date, IntelliCell has developed proprietary
technologies that allow for the efficient and reproducible
separation of stromal vascular fraction (branded
"IntelliCell(TM)") containing adipose stem cells that can be
performed in tissue processing centers and in doctors' offices.
The Company has incurred losses since inception resulting in an
accumulated deficit of $43,079,590 and a working capital deficit
of $3,811,024 as of March 31, 2012, respectively. However, if the
non-cash expense related to the Company's change in fair value of
derivative liability and stock based compensation is excluded then
the accumulated deficit amounted to $4,121,538. Further losses
are anticipated in the continued development of its business,
raising substantial doubt about the Company's ability to continue
as a going concern.
The Company's balance sheet at Sept. 30, 2012, showed
$4.15 million in total assets, $7.31 million in total liabilities
and a $3.16 million total stockholders' deficit.
INTERLINE BRANDS: S&P Revises Outlook on 'B+' CCR to Negative
-------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Jacksonville, Fla.-based Interline Brands Inc. (Delaware Corp.) to
negative from stable. "At the same time, we affirmed our ratings
on Interline, including the 'B+' corporate credit rating," S&P
said.
"Our outlook revision to negative reflects our expectation that
pro forma debt to EBITDA will rise to about 6.5x as a result of
the company's recently announced acquisition of JanPak Inc.," said
Standard & Poor's credit analyst Maurice Austin. "The ratings and
outlook also take into account our assessment of Interline's
highly leveraged financial risk profile which reflects the
increased debt burden, reduced interest coverage, and uncertainty
regarding the financial policies of its new owners, affiliates of
GS Capital Partners LP and P2 Capital Partners LLC (not rated).
The ratings also reflect our view of the company's 'fair' business
risk profile, which includes the company's participation in a
highly fragmented and competitive industry, low margins and
somewhat intensive working capital use. Tempering these weaknesses
are Interline's good customer, product, and geographic diversity,
as well as relatively stable sales to institutional and
multifamily REIT markets, particularly in its janitorial and
facilities maintenance segments. Our ratings also acknowledge
Interline's 'adequate' liquidity and our expectation that
Interline will continue to generate positive free cash flow, which
would give the company the flexibility to bring leverage back down
over time," S&P said.
"Our baseline scenario for 2012 reflects Interline's improved
operating results, which recent acquisitions support, and that we
think will lead to gradually improving margins, as well as
increasing occupancy and rent rates for multifamily REITs. As a
result, we anticipate sales growth in the mid-single digits, given
declining vacancy rates and increasing rents among multifamily
REITS, a key market for Interline," S&P said.
"The rating on Interline Brands Inc. (Delaware Corp.) reflects the
increase in debt to support the JanPak acquisition. Pro forma for
the transaction, total debt is about $910 million versus about
$860 million as of the end of September 2012, post the LBO
transaction. As a result, in addition to increased leverage, we
expect interest coverage to be about 3x," S&P said.
"The negative outlook reflects the leveraged nature of the
proposed acquisition and, to a lesser extent, the uncertainty
surrounding the financial policies of the new owners. We would
lower our rating one notch if leverage is not trending toward 5.5x
by the end of 2013. This could occur if there is no meaningful
debt reduction within the next 12 months or there is deterioration
in operating performance such that gross margins decline more than
100 basis points from current levels," S&P said.
"We could revise the outlook to stable if Interline uses its
excess free cash flow to pay down debt such that leverage
strengthens to below 5.5x with continued positive momentum by the
end of next year," S&P said.
INTERNET SPECIALTIES: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Internet Specialties West, Inc., a California corporation
aka IS West
30077 Agoura Court
First Floor
Agoura Hills, CA 91301
Bankruptcy Case No.: 12-20897
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Central District of California (San Fernando Valley)
Debtor's Counsel: Ashley M. McDow, Esq.
MIRMAN, BUBMAN & NAHMIAS LLP
21860 Burbank Blvd, Ste.360
Woodland Hills, CA 91367-7406
Tel: (818) 451-4600
Fax: (818) 451-4620
E-mail: amcdow@mbnlawyers.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors, filed
together with the petition is available, for free at
http://bankrupt.com/misc/cacb12-20897.pdf
The petition was signed by Drew J. Kaplan, director and Jeffrey I.
Golden - Chapter 11 trustee for Robert Johnson, director.
Affiliate who filed a separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- --------
Robert & Linda Johnson 11-18629 07/18/11
INVESTORS CAPITAL: Files for Chapter 11 in Kentucky
---------------------------------------------------
Brentwood, Tennessee-based Investors Capital Partners II, LP and
two affiliates sought Chapter 11 protection (Bankr. W.D. Ky. Case
Nos. 12-11575 to 11677) in Bowling Green, Kentucky, on Dec. 19,
2012.
In its bare-bones Chapter 11 petition, Investors Capital Partners
II estimated assets of at least $10 million and liabilities of
less than $10 million. It said that principal assets are located
at 2400 Happy Valley Road, in Glasgow, Kentucky.
INVESTORS CAPITAL: Case Summary & 9 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Investors Capital Partners II, LP
100 Winners Circle, Ste 400
Brentwood, TN 37027
Bankruptcy Case No.: 12-11675
Chapter 11 Petition Date: December 19, 2012
Court: United States Bankruptcy Court
Western District of Kentucky (Bowling Green)
Debtors' Counsel: Travis Kent Barber, Esq.
DELCOTTO LAW GROUP PLLC
200 North Upper Street
Lexington, KY 40507
Tel: (859) 231-5800
E-mail: kbarber@dlgfirm.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliates that simultaneously sought Chapter 11 protection:
Debtor Case No.
------ --------
Investors Capital Partners I, LP 12-11676
Assets: $1,000,001 to $10,000,000
Debts: $1,000,001 to $10,000,000
Investors Land Partners II, LP 12-11677
The petitions were signed by Vernon M. Veldekens, manager.
A. List of Investors Capital Partners II LP's Nine Largest
Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Frasier, Dean & Howard, Legal services $43,740
PLLC
3310 West End Avenue
Ste 550
Nashville, TN 37203
Superior Fence Systems, Trade vendor $22,906
Inc.
205 Industrial Drive
Glasgow, KY 42141
S & S Electric Co. Trade vendor $21,225
P.O. Box 4448
Bowling Green, KY
42102-4448
Towne & Country Parking Trade vendor $10,265
Lot Service
Geoghegan Roofing & Trade vendor $3,983
Supply, Inc.
Barge Waggoner & Trade vendor $1,133
Cannon Inc.
Bradley Arant Boult Legal services $726
M&L Electrical Inc. Trade vendor $420
Cummings LLP
American Engineers, Inc. Trade vendors $390
B. List of Investors Capital Partners I LP's Two Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bradley Arant Boult Legal services $436,148
Cummings LLP
1600 Division Street
Ste 700
P.O. Box 340025
Nashville, TN 37203
Frasier, Dean & Howard, Legal services $30,263
PLLC
3310 West End Avenue
Ste 550
Nashville, TN 37203
J CREW GROUP: Moody's Says Special Dividend Credit Negative
-----------------------------------------------------------
Moody's Investors Service on Dec. 20 said that J. Crew Group,
Inc.'s announcement that it will pay a special cash dividend to
shareholders is a credit negative, but that the transaction has no
immediate impact on the company's ratings or stable outlook.
On December 18, 2012, J. Crew announced that upon effectiveness of
an amendment to its credit agreement, its Board of Directors
declared a special cash dividend to shareholders in the aggregate
amount of up to $200 million, payable on December 21, 2012.
The use of cash will constrain J. Crew's liquidity, resulting in
less de-leveraging capability. While the company's ratings and
outlook are unchanged, there is no cushion for additional
shareholder friendly activities at this time.
J. Crew's operating performance has been solid over the past nine
months, with revenue and earnings growth coming from strong
comparable company sales, new store openings, improved merchandise
margins and buying and occupancy leverage. Lease-adjusted
debt/EBITDA (including 50% of class L common stock treated as
debt) has declined to near 6 times from 7 times at the beginning
of the year.
J. Crew's Speculative Grade Liquidity rating is unchanged at SGL-
1, reflecting the expectation that remaining cash and free cash
flow will internally fund cash needs over the next twelve months,
with further support added by ample excess revolver availability,
the lack of financial maintenance covenants, and no near-term debt
maturities. J. Crew had $195.7 million of cash on its balance
sheet as of the third quarter ended October 27, 2012, and it
typically generates solid positive free cash flow in its fourth
fiscal quarter.
J. Crew's ratings are as follows:
Corporate Family Rating at B2;
Probability of Default rating at B2;
$1.2 billion senior secured term loan due 2018 at B1 (LGD 3,
41%);
$400 million senior unsecured notes due 2019 at Caa1 (LGD 5,
88%);
Speculative Grade Liquidity rating at SGL-1
The ratings outlook is stable.
The principal methodology used in rating J. Crew was the Global
Retail Industry Methodology published in June 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
J. Crew Group, Inc., headquartered in New York, NY, is a multi-
channel apparel retailer. As of November 28, 2012, the company
operated 400 retail and factory outlet stores under the J. Crew,
crewcuts and Madewell names, a J. Crew and Madewell catalog
business, and websites under the J. Crew and Madewell names.
Revenue exceeded $2.1 billion in the latest twelve month period
ended October 27, 2012.
JOLIET CROSSINGS: Case Summary & 10 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Joliet Crossings 2010, LLC
fka Tower Market Place 2008 LLC
7501 S. Lemont Road, Suite 300
Woodridge, IL 60517
Bankruptcy Case No.: 12-49294
Chapter 11 Petition Date: December 17, 2012
Court: U.S. Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Jacqueline P. Cox
Debtor's Counsel: Ariel Weissberg, Esq.
WEISSBERG & ASSOCIATES, LTD.
401 S. LaSalle Street, Suite 403
Chicago, IL 60605
Tel: (312) 663-0004
Fax: (312) 663-1514
E-mail: ariel@weissberglaw.com
Scheduled Assets: $17,000,000
Scheduled Liabilities: $15,940,244
The petition was signed by Washington Note Acquisition, LLC,
manager.
List of the Debtor's 10 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
ACP Development LLC -- Unknown
7501 S. Lemont Road, Suite 300
Woodridge, IL 60517
Ardmin Properties R.E. Investment -- Unknown
Group, Inc.
7501 S. Lemont Road, Suite 300
Woodridge, IL 60517
Bronk Town Center 2005, LLC -- Unknown
7501 S. Lamont Road, Suite 300
Woodridge, IL 60517
Dennis Madsen -- Unknown
Greenway Group, Inc. -- Unknown
HR Green -- Unknown
James Minnick -- Unknown
Joseph Ardovitch -- Unknown
LA Fitness International -- Unknown
Tower Market Place 2008 -- Unknown
JOURNAL REGISTER: Court Approves February Auction, Bid Protocol
---------------------------------------------------------------
Digital First Media, which operates MediaNews Group, Journal
Register Company and Digital First Ventures, disclosed that the
U.S. Bankruptcy Court for the Southern District of New York has
approved the bid procedures, sale process and timeline for Journal
Register Company's auction and sale process.
"We are pleased that the Court has approved the dates for
competing bids and the auction and that Journal Register Company
has now received the full support and cooperation in the sales
process with the Official Creditors Committee," said John Paton,
Chief Executive Officer of Digital First Media.
The public auction is expected to conclude on or before Feb. 15,
2013 with the Court approving the winning bid by Feb. 21, 2013.
The "stalking horse" bid filed by 21st CMH Acquisition Co., an
affiliate of funds managed by Alden Global Capital LLC, is
structured so all post-petition payables and substantially all
pre-petition trade creditors' claims are assumed.
When it filed for bankruptcy, Journal Register indicated it
expected to complete the auction and sale process within 90 days.
About Journal Register
Journal Register Company -- http://www.JournalRegister.com/-- is
the publisher of the New Haven Register and other papers in 10
states, including Philadelphia, Detroit and Cleveland, and in
upstate New York. The Company's more than 350 multi-platform
products reach an audience of 21 million people each month. JRC
is managed by Digital First Media and is affiliated with MediaNews
Group, Inc., the nation's second largest newspaper company as
measured by circulation.
Journal Register, along with its affiliates, first filed for
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No.
09-10769) on Feb. 21, 2009. Attorneys at Willkie Farr & Gallagher
LLP, served as counsel to the Debtors. Attorneys at Otterbourg,
Steindler, Houston & Rosen, P.C., represented the official
committee of unsecured creditors. Journal Register emerged from
Chapter 11 protection under the terms of a pre-negotiated plan.
Journal Register returned to bankruptcy (Bankr. S.D.N.Y. Lead Case
No. 12-13774) on Sept. 5, 2012, to sell the business to 21st CMH
Acquisition Co., an affiliate of funds managed by Alden Global
Capital LLC. The deal is subject to higher and better offers.
Journal Register exited the 2009 restructuring with $225 million
in debt and with a legacy cost structure, which includes leases,
defined benefit pensions and other liabilities that have become
unsustainable and threatened the Company's efforts for a
successful digital transformation. Journal Register managed to
reduce the debt by 28% with the Company servicing in excess of
$160 million of debt.
Alden Global is the holder of two terms loans totaling $152.3
million. Alden Global acquired the stock and the term loans from
lenders in Journal Register's prior bankruptcy.
Journal Register disclosed total assets of $235 million and
liabilities totaling $268.6 million as of July 29, 2012. This
includes $13.2 million owing on a revolving credit to Wells Fargo
Bank NA.
Bankruptcy Judge Stuart M. Bernstein presides over the 2012 case.
Neil E. Herman, Esq., Rachel Jaffe Mauceri, Esq., and Patrick D.
Fleming, Esq., at Morgan, Lewis & Bockius, LLP; and Michael R.
Nestor, Esq., Kenneth J. Enos, Esq., and Andrew L. Magaziner,
Esq., at Young Conaway Stargatt & Taylor LLP, serve as the 2012
Debtors' counsel. SSG Capital Advisors, LLC, serves as financial
advisors. American Legal Claims Services LLC acts as claims
agent. The petition was signed by William Higginson, executive
vice president of operations.
Otterbourg, Steindler, Houston & Rosen, P.C., represents Wells
Fargo. Akin, Gump, Strauss, Hauer & Feld LLP, represents the
Debtors' Tranche A Lenders and Tranche B Lenders. Emmet, Marvin &
Martin LLP, serves as counsel to Wells Fargo, in its capacity as
Tranche A Agent and the Tranche B Agent.
The Official Committee of Unsecured Creditors appointed in the
case has retained Lowenstein Sandler PC as counsel and FTI
Consulting, Inc. as financial advisor.
KURB PROPERTIES: Case Summary & 6 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Kurb Properties, LLC
5112 Glen Forest Drive
Raleigh, NC 27612
Bankruptcy Case No.: 12-08912
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Debtor's Counsel: William P. Janvier, Esq.
JANVIER LAW FIRM, PLLC
1101 Haynes Street, Suite 102
Raleigh, NC 27604
Tel: (919) 582-2323
Fax: (866) 809-2379
E-mail: bill@janvierlaw.com
Scheduled Assets: $1,801,125
Scheduled Liabilities: $1,648,456
A list of the Company's six largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/nceb12-08912.pdf
The petition was signed by Kartik Patel, president/manager.
LANGUAGE LINE: Moody's Cuts CFR/PDR to 'B2'; Outlook Stable
-----------------------------------------------------------
Moody's Investors Service downgraded the Corporate Family Rating
("CFR") and the Probability of Default Rating ("PDR") of Language
Line Holdings, LLC to B2 from B1. Concurrently, Moody's lowered
the first lien credit facility rating to B1 from Ba3 and the
second lien term loan rating to Caa1 from B3. The ratings outlook
is stable.
Ratings lowered at Language Line Holdings, LLC:
Corporate Family Rating, to B2 from B1
Probability of Default Rating, to B2 from B1
Ratings lowered (and Loss Given Default assessments updated) at
subsidiaries Language Line, LLC and Tele-Interpreters Acquisition
LLC:
$50 million first lien revolver due 2015, to B1 (LGD3, 36%)
from Ba3 (LGD3, 37%)
$525 million first lien term loan due 2016, to B1 (LGD3, 36%)
from Ba3 (LGD3, 37%)
$175 million second lien term loan due 2016, to Caa1 (LGD5,
89%) from B3 (LGD5, 89%)
Ratings Rationale
The CFR downgrade to B2 from B1 reflects continuing weak demand
trends for Language Line's core over the phone interpretation
("OPI") business. "Organic growth opportunities for outsourced OPI
volumes are limited, causing heightened competition within this
fragmented industry", stated Moody's senior analyst Suzanne Wingo.
Average pricing is falling as contracts come up for renewal, while
Language Line is also experiencing modest declines in billed
minutes. Moody's anticipates that consolidated revenues may
deteriorate marginally in 2013 after falling 3-7% annually in each
of the past three years. Despite $45 million of debt reduction
since 2010, lower earnings have led to a steady increase in
financial leverage to 6x (Moody's adjusted debt / EBITDA) as of
September 30, 2012.
The B2 CFR benefits from Language Line's still-high EBITDA margin,
despite meaningful compression over the past three years, and its
leading share in the domestic OPI market. Liquidity is supported
by a $21 million cash balance and Moody's expectation for at least
$35 million of free cash flow generation in 2013. However, the
leverage covenant contained in the senior secured credit facility
is scheduled to step down to 5.75x at June 30, 2013 and then to
5.5x at September 30, 2013. Absent an amendment, Moody's considers
it highly likely that Language Line will need to use cash to
reduce debt or otherwise de-leverage to comply with the covenant.
The stable outlook reflects Moody's expectation that Language Line
maintains an adequate liquidity profile, revenues do not decline
more than 4% in 2013, and any earnings deterioration is more than
offset by debt reduction so that financial leverage (Moody's
adjusted debt / EBITDA) is sustained below 6x. The ratings could
be upgraded if the top line returns to sustained growth, financial
leverage is maintained below 4.5x times and free cash flow to debt
exceeds 7%. The ratings could be downgraded if end market demand
weakens or the competitive environment intensifies beyond
expectations, resulting in a material deterioration in revenue or
profitability, or if Language Line does not take steps to ensure
comfortable compliance with its financial covenants. A significant
debt-financed acquisition or tightening of liquidity could also
pressure the ratings, particularly if Moody's adjusted debt /
EBITDA approaches 6.5 times or free cash flow falls below 2%.
California-based Language Line provides over-the-phone
interpretation services from English into more than 170 different
languages. The company is controlled by ABRY Partners, LLC and
reported revenues of $259 million in the twelve month period ended
September 30, 2012.
The principal methodology used in rating Language Line Holdings
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.
LIBERTY HARBOR: Has Until Jan. 15 to File Chapter 11 Plan
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey extended
Liberty Harbor Holding, LLC's exclusive periods to file and
solicit acceptances for a proposed Plan of Reorganization until
Jan. 15, 2013, and March 19, respectively.
Jersey City, New Jersey-based Liberty Harbor Holding, LLC, along
with two affiliates, sought Chapter 11 protection (Bankr. D. N.J.
Lead Case No. 12-19958) in Newark on April 17, 2012. Liberty, as
of April 16, 2012, had total assets of $350.08 million, comprising
of $350 million of land, $75,000 in accounts receivable and $458
cash. The Debtor says that it has $3.62 million of debt,
consisting of accounts payable of $73,500 and unsecured non-
priority claims of $3,540,000. The Debtor's real property
consists of Block 60, Jersey City, NJ 100% ownership Lots 60, 70,
69.26, 61, 62, 63, 64, 65, 25H, 26A, 26B, 27B, 27D.
Affiliates that filed separate petitions are: Liberty Harbor II
Urban Renewal Co., LLC (Case No. 12-19961) and Liberty Harbor
North, Inc. (Case No. 12-19964).
Judge Novalyn L. Winfield presides over the case. The petition
was signed by Peter Mocco, managing member.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed three
creditors to the Official Committee of Unsecured Creditors in the
Chapter 11 cases of the Debtor.
MEDYTOX SOLUTIONS: Borrows Add'l $650,000 From TCA Global
---------------------------------------------------------
Medytox Solutions, Inc., borrowed an additional $650,000 from TCA
Global Credit Master Fund, LP, pursuant to the terms of Amendment
No. 2 to Senior Secured Revolving Credit Facility Agreement, dated
as of Oct. 31, 2012. These additional funds will be used in
accordance with management's discretion.
The Company previously borrowed $550,000 from TCA pursuant to the
terms of the Senior Secured Revolving Credit Facility Agreement,
dated as of April 30, 2012. Medytox borrowed an additional
$525,000 from TCA pursuant to the terms of Amendment No. 1 to
Senior Secured Revolving Credit Facility Agreement, dated as of
July 31, 2012.
Amendment No. 2 effected certain changes to the terms of the
Credit Agreement:
* the revolving loan commitment was increased from $1,100,000
to $1,725,000 and is subject to further increase up to a
maximum of $15,000,000 in TCA's sole discretion;
* the maturity date of the loan was extended to Sept. 3, 2013,
from the previous maturity of Feb. 8, 2013 (subject to TCA's
continuing ability to call the loan upon 60 days written
notice); and
* a covenant was added to require that any subsidiary that is
formed, acquired or otherwise becomes a subsidiary must
guarantee the loan and pledge substantially all of its assets
as security for the loan.
Medytox paid certain fees to TCA, Medytox also issued to TCA
10,000 shares of its restricted common stock as a fee for
corporate advisory and investment banking services provided by
TCA.
In connection with Amendment No. 2, Medytox executed an Amended
and Restated Revolving Promissory Note in the amount of
$1,725,000.
About Medytox Solutions
West Palm Beach, Florida-based Medytox Solutions, Inc., formerly
Casino Players, Inc., is a provider of laboratory services
specializing in providing blood and urine drug toxicology to
physicians, clinics and rehabilitation facilities in the United
States.
Peter Messineo, CPA, in Palm Harbor, Florida, expressed
substantial doubt about Medytox Solutions' ability to continue as
a going concern following the 2011 financial results. The
independent auditor noted that the Company has an accumulated
deficit and negative cash flows from operations, and additionally,
there is certain litigation involving a consolidated entity which
is unresolved.
The Company reported net income of $92,701 of $3.99 million of
revenues for 2011, compared with a net loss of $327,041 on
$77,591 of revenues for 2010.
The Company's balance sheet at Sept. 30, 2012, showed $6.09
million in total assets, $7.35 million in total liabilities and a
$1.25 million total stockholders' deficit.
MERCER INTERNATIONAL: Moody's Affirms 'B2' Corp. Family Rating
--------------------------------------------------------------
Moody's Investors Service affirmed all long-term ratings on Mercer
International, Inc., including the B2 Corporate Family Rating
("CFR"), and revised the rating outlook to stable from positive.
The revision of the rating outlook reflects Moody's view that
expected cash flow generation will not be sufficient to warrant a
rating upgrade in the near-term. Moody's also affirmed the
company's SGL-2 short term liquidity rating.
The rating affirmation reflects Moody's view that Mercer is
positioned solidly in the B2 rating category. The affirmation
takes into consideration recent improvements to the company's
operations and balance sheet that position it to better withstand
trough cycle conditions and help offset the event risk associated
with only a two asset operating profile in the rated restricted
group. However, Moody's does not expect the pricing environment
for northern bleached softwood kraft pulp ("NBSK") will enable
Mercer to generate the levels of cash flow envisioned when the
rating outlook was revised to positive in late 2011. NBSK
benchmark pricing of $870/tonne in November is meaningfully lower
than peak levels of over $1000/tonne in mid-2011. Moody's believes
that recent and planned capacity additions in the industry
combined with soft end market demand will make it difficult for
prices to move up meaningfully in 2013. As a result, Moody's
expects Mercer will achieve only modest improvement in credit
measures over that horizon and will not generate enough cash to
support a near term rating upgrade, which drives the return to a
stable rating outlook.
The actions:
Issuer: Mercer International, Inc.
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2
Senior Unsecured Notes due 2017, Affirmed B3 (LGD5 72%;
revised from LGD4 69%)
Outlook, Revised to Stable from Positive
Rating Rationale
The B2 Corporate Family Rating ("CFR") is constrained primarily by
the small scale of the company and the cyclical characteristics of
the pulp industry. Mercer is a small producer of market softwood
pulp with two operating assets in the rated restricted group.
Operating margins have fluctuated significantly over the past
several years due to the cyclical characteristics of the pulp
industry and additional company-specific dynamics such as the
absence of vertical integration. Actions taken to improve the
company's cost structure, such as investments to increase
renewable energy sales, an evidenced ability to generate
significant cash flow during periods of cyclical strength, and a
good liquidity position support the rating. Credit metrics are
currently soft for the rating category with debt leverage near 6
times Debt/EBITDA and interest coverage below 1 times (EBITDA-
CapEx)/Interest.
The stable rating outlook assumes that credit protection measures
will improve modestly in 2013, but remain relatively soft for the
rating category, and that the company will maintain good liquidity
to support its operations. Moody's could upgrade the rating with a
combination of improvement to the balance sheet and reduction of
event risk associated with a two asset profile. Conversely,
Moody's could downgrade the rating if deterioration in operating
performance, industry conditions, or exchange rates suggests the
company's liquidity position may not be sufficient to withstand a
cyclical downturn. Shareholder friendly activities of significance
or an adverse change in expected mid-cycle credit measures could
also have negative rating implications.
The principal methodology used in rating Mercer International,
Inc. was the Global Paper and Forest Products Industry Methodology
published in September 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.
Mercer International, Inc. produces northern bleached softwood
kraft pulp. Moody's ratings cover only the Restricted Group
comprised of the Celgar Mill in western Canada and the Rosenthal
Mill in eastern Germany. The Stendal Mill in eastern Germany is
not included in the Restricted Group and has significant non-
recourse project financing. Annual production capacity for the
Restricted Group is approximately 850 thousand air-dried metric
tons. Headquartered in Vancouver, B.C., Mercer generated
approximately EUR478 million of revenue for the twelve months
ended September 30, 2012.
METROPOLITAN HEALTH: S&P Ups Counterparty Credit Rating From 'B+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term
counterparty credit rating on Metropolitan Health Networks Inc.
(MDF) to 'BBB' from 'B+'. "At the same time we removed the rating
from CreditWatch with positive implications, where it was
initially placed Nov. 6, 2012, and assigned a positive outlook.
Subsequently, we withdrew our counterparty credit rating on MDF at
Humana's (BBB/Positive/--) request. In addition, we withdrew our
issue-level ratings on MDF's senior secured debt because all of
this debt has been repaid," S&P said.
"Our rating action follows Humana's announcement that it has
completed its acquisition of Metropolitan Health Networks," said
Standard & Poor's credit analyst Neal Freedman. "We upgraded MDF
because we view the company as core to the Humana organization.
The two companies have been doing business together for many years
with MDF acting as contracting provider for Humana's Medicare
Advantage business, which is a key business for Humana. Humana
constituted approximately 80% of MDF's revenues."
MICHIGAN STATE HOSP: Fitch Affirm 'BB+' Rating on $30.68MM Bonds
----------------------------------------------------------------
Fitch Ratings has affirmed the 'BB+' rating on the following
bonds:
-- $30.68 million Michigan State Hospital Finance Authority
revenue and refunding bonds series 2005 (Presbyterian
Villages of Michigan Obligated Group).
The Rating Outlook is Stable.
SECURITY
The series 2005 bonds are secured by a pledge of the obligated
group's (OG) gross revenues, a first mortgage on the OG's
facilities, and a debt service reserve fund.
KEY RATING DRIVERS
DEBT SERVICE STABLE: Debt service coverage is 1.4 times (x) in the
nine month interim period, which is consistent year over year
(YOY), and PVM expects to make its year end budget of 1.5x
coverage.
LIQUIDITY ADEQUATE FOR RATING LEVEL: PVM had 96.6 days cash on
hand (DCOH), a 4.1x cushion ratio, and 28.9% cash to debt as of
Sept. 30, 2012, all lower YOY, but adequate for the rating level.
The lower liquidity was driven by a $2.9 million rise for amounts
due from PVM affiliates and facility advancement projects. PVM
has consistently supported projects outside the OG.
OCCUPANCY CONSISTENT YOY: Overall occupancy is good at 87.2% as of
September 2012, which is stable YOY. Management initiatives,
including the reconfiguration of units and services and enhanced
marketing efforts, have supported stable occupancy.
YTD FINANCIAL PERFORMANCE STABLE: PVM continues to manage expenses
well and an increase in philanthropy produced a slightly stronger
financial performance in the nine month interim period.
CREDIT SUMMARY
The 'BB+' rating affirmation and Stable Outlook reflect PVM's
stable financial profile at the current rating level characterized
by adequate liquidity, consistent debt service coverage, tight
expense control, and improving occupancy.
At Sept. 30, 2012, PVM's level of unrestricted cash and
investments was $9.5 million, which equates to 96.6 DCOH, a
cushion ratio of 4.1x and cash to debt of 28.3%. Liquidity is
slightly lower YOY, but remains adequate for the rating level.
Lower liquidity was driven by a $2 million contribution to seed
the Center for Senior Independence, a joint venture PACE program
with the Henry Ford Health System. PVM regularly provides
advances for programs and capital projects outside the obligated
group and as of Sept. 30, 2012, PVM had $9.2 million of
advancements and receivables, which continues to suppress
liquidity. While these advancements and receivables are a credit
concern, PVM has a formal written policy in place and Fitch
believes the advances and commitments are manageable at the
current rating level.
PVM management expects to end the year with maximum annual debt
service coverage of 1.5x, which is what PVM budgeted. Through the
nine-month 2012 interim period, PVM reduced its operating loss to
$1.2 million from $1.7 million due largely to a YOY increase of
philanthropic funds released for operations. Without that
increase in released funds operation remained fairly stable as PVM
continued to flex staff depending on the levels of occupancy
across the system and controlled other costs.
PVM has implemented a number of initiatives to help increase
occupancy. The Village of Westland campus has been a particular
challenge, and PVM initiated a program on that campus to provide
additional services in independent living units for a fee, which
has helped occupancy. The program has been successful and PVM is
replicating it on other campuses. Overall in the nine month
interim period IL occupancy was at 87.2%, consistent with the
prior year figures but it remains an improvement over September
2010 when occupancy was at 83.5%.
PVM is in the middle of a state-wide fundraising campaign which
has increased donations (system-wide the campaign has netted a
strong $9 million in unrestricted, temporarily restricted, and
permanently restricted donations as of Sept. 30, 2012).
Headquartered in Southfield, MI, the PVM Obligated Group consists
of PVM Corporate, a foundation, and three rental continuing care
retirement communities located in Redford, Westland and
Chesterfield Township, MI. PVM OG had approximately $35.4 million
in operating revenue in 2011. Currently, the Obligated Group's
three campuses total 326 independent rental apartments (of which
313 are operational), 236 assisted living units (of which 234 are
operational), and 178 skilled nursing beds. In addition, PVM owns
or manages approximately 1,250 independent living and 28 assisted
living units through non-obligated entities.
PVM has covenanted to provide annual audited financial statements
and quarterly unaudited financials to the to the Municipal
Securities Rulemaking Board's EMMA system. Fitch notes that PVM's
disclosure practices have been excellent.
MILLION AIR: Moody's Cuts Revenue Bond Rating to 'B1'
-----------------------------------------------------
Moody's Investors Service has downgraded to B1 from Ba3 the rating
on the Million Air One LLC General Aviation Facilities Projects
Revenue Bonds, Series 2011 issued by the Capital Trust Agency. The
rating outlook is revised to negative.
Summary Rating Rationale
The rating is based on Million Air One's competitiveness as one of
the major brands in the FBO (Fixed Base Operator) industry, its
diversified revenue base from three locations, at two of which
Million Air One currently faces no competition, and project
finance features including a debt service reserve and a
supplemental reserve fund which together cover 2 years worth of
debt service. The rating is also based on the FBO industry's
specialized nature of service, a customer base susceptible to
macroeconomic conditions, no long-term contracts, and low
financial metrics.
The downgrade and negative outlook are based on the events that
have caused cash flow to fall below expected levels at all three
locations and caused the company's inability to fund the
supplemental reserve on-schedule. While these events are the types
of risks Moody's accounted for in the initial rating, the fact
that all three locations have been affected so early in the
projection period and before the supplemental reserve has been
fully funded increases the likelihood that additional setbacks
will threaten bondholder security. These risks are heightened by
broader traffic trends at the airports and national economic
trends which have a negative bias in Moody's view.
The rating reflects the uncertainty of the projects cash flows at
the three locations, each of which face either strong competition
or the need to grow the customer base after an extended period of
decline. The project's exposure to event risk, given the
geographic concentration also factors into the rating.
Strengths
* Operations at three separate locations in Houston,
Tallahassee, and Gulfport-Biloxi, MS provide revenue
diversity, though approximately 50% is concentrated at the
Houston location, and all three are located along the Gulf
Coast
* Projects have strong competitive position at each airport with
little to no competition at Tallahassee, and Gulfport-Biloxi,
and a position as a market leader among the five FBOs at
Houston
* Construction risk is limited at all locations in various ways,
minimizing cost overrun risks; though construction delays at
Houston have increased the potential severity of the risks
* Cost containment measures have brought expected operating
expenses down nearly $1.0 million in 2012
Challenges
* Low initial revenues have made the company unable to fully
fund its required supplemental reserve and have called into
question the long-term viability of the company's revenues
* The FBO industry is highly competitive and fragmented, though
Million Air is one of the largest national brands
* Long-term national demand for FBO services has been
increasing, but it is sensitive to macroeconomic factors such
as national and local economic conditions, oil price
fluctuations, and federal spending priorities
* Low debt service coverage reveals little resiliency to risk of
unexpected events
* Cross default among Million Air One, LLC and the three
subsidiaries would result in indenture default if any of the
projects default on its ground lease. This is mitigated by a
six-month security deposit and the structure whereby lease
payments are made ahead of debt service
* The current leases at Tallahassee and Gulfport-Biloxi expire
before the end of debt service requirements, 2 and 3 years,
respectively, but each has an option period that could cover
the remaining period
Outlook
The negative outlook is based on the events that have caused cash
flow to fall below expected levels at all three locations and
caused the company's inability to fund the supplemental reserve
on-schedule. While Moody's expects revenue growth at Tallahassee
and Gulfport to improve, industry trends, national economic
trends, and the narrow margin of error in construction at Houston
have increased the risk that the company's credit strength will
trend downward in the next 12 to 18 months.
What Could Change The Rating - UP
A continuous increase in customer base resulting in revenues that
yield a sustained minimum debt service coverage above 1.75 times,
full funding of all reserves, and full completion of the Houston
facility on-time in January 2014.
What Could Change The Rating - DOWN
A significant decrease in fuel sales, termination of any of the
existing ground leases or a failure to follow the terms of the
current forebearance agreement including funding the supplemental
reserve according to the new schedule outlined in that agreement.
Rating Methodology
The principal methodology used in this rating was Generic Project
Finance Methodology published in December 2010.
NEEBO INC: S&P Assigns 'CCC+' Corporate Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' corporate
credit rating to Lincoln, Neb.-based Neebo Inc. The outlook is
stable.
"At the same time, we assigned our 'CCC' issue-level rating to the
company's $100 million senior secured notes. The recovery rating
on the notes is '5', indicating our belief that the lenders could
expect modest recovery (10% to 30%) in the event of a payment
default or bankruptcy," S&P said.
"We estimate the company has about $160 million in reported debt
outstanding," S&P said.
"The ratings on Neebo reflect our forecast for the company's
credit ratios to remain weak and our view that its liquidity
profile is weak," said Standard & Poor's credit analyst Brian
Milligan. "It also reflects our view that its on-campus bookstore
presence is much weaker than competitors, and its off-campus
bookstores are increasingly vulnerable to online discount
retailers."
"The outlook is developing, which reflects the company's need to
refinance its bridge loan before June 2013. Standard & Poor's
forecasts a material deficit of cash sources to cover cash uses
during fiscal 2014 if the company is unable to refinance the
bridge loan with a multiyear revolving credit facility. We could
raise the ratings if the company successfully refinances the
bridge loan with a multiyear revolving credit facility large
enough to comfortably cover expected peak borrowing needs. We
could lower the ratings if the company is unable to refinance the
bridge loan, because we believe the current capital structure is
unsustainable without a multiyear revolving credit facility," S&P
said.
NEWPAGE CORP: Emerges From Bankruptcy; Closes $850MM Exit Loan
--------------------------------------------------------------
NewPage Corporation on Dec. 21 said it has successfully completed
its financial restructuring and has officially emerged from
Chapter 11 bankruptcy protection pursuant to its Modified Fourth
Amended Chapter 11 Plan, confirmed on Dec. 14, by the U.S.
Bankruptcy Court for the District of Delaware in Wilmington.
In conjunction with the Plan, NewPage closed on its exit
financing, consisting of a $500 million term loan facility led by
Goldman Sachs Lending Partners LLC and a $350 million revolving
credit facility led by J.P. Morgan Securities LLC.
As reported by the Troubled Company Reporter, citing Bloomberg
News, first-lien creditors are in line for 56.6% recovery by
receiving all the new stock in exchange for debt under the
confirmed plan. Second-lien noteholders and some unsecured
creditors will recover on a pro rata basis from $30 million in
cash and the first $50 million collected by a litigation trust.
Holders of $1.06 billion in second-lien debt are projected to
recover 5.9%. Depending on which election some creditors make,
the recovery by holders of $29.3 million in unsecured claims is
5.3%. Trade suppliers with $21.4 million in claims who agree to
provide credit in the future will receive 15% on their claims over
two years. Holders of $207.9 million in senior subordinated debt
are projected for a 0.2% recovery. After the initial $50 million
from the trust, additional distributions will be shared by the
first- and second-lien noteholders and some unsecured creditors.
NewPage will fund the litigation trust with $40 million in cash
and specified lawsuit recoveries. NewPage is to loan the trust $5
million to pay administrative expenses. The official creditors'
committee supported the plan.
The $1.77 billion in 11.375% first-lien notes maturing in 2014
traded on Dec. 12 for 46 cents on the dollar, according to Trace,
the bond-price reporting system of the Financial Industry
Regulatory Authority. The $806 million in 10% second-lien notes
traded on Dec. 12 for 4.751 cents on the dollar, according to
Trace.
NewPage this month filed with Bankruptcy Court a Modified Fourth
Amended Joint Chapter 11 Plan. According to the Debtors, the
Joint Chapter 11 Plan consists of 12 separate chapter 11 Plans --
one for each of the Debtors that will emerge as a reorganized
entity. The Plans do not provide for the substantial
consolidation of any of the Debtors' estates. Debtors NewPage
Group Inc. and NewPage Holding Corporation did not propose a plan,
and will be dissolved.
"This is an exciting day for all of us at NewPage," said George F.
Martin, president and chief executive officer. "We have
successfully completed our restructuring, and we have emerged as a
financially sound company. This step helps to solidify our
position as the leading North American producer of printing and
specialty papers. We look forward to continuing to provide our
customers with exceptional service and high-quality products,
operating safe and efficient mills and being a responsible
community member."
Mr. Martin continued, "I would like to thank our customers and
suppliers for their support during this process. I would also like
to extend my gratitude to our employees for their hard work and
tireless dedication throughout the reorganization and the
challenging period leading up to it."
Jay A. Epstein, senior vice president and chief financial officer
for NewPage, added, "Through the reorganization process, we
significantly reduced our debt and emerged with a sustainable
capital structure. Our exit facility will provide ample liquidity
to meet all of our working capital and capital investment needs."
NewPage thanked Judge Kevin Gross for "successfully shepherding
the case through the Chapter 11 process and protecting 6,000 jobs,
and to Judge Robert Drain for mediating the economic settlement
that paved the way for a consensual Chapter 11 Plan."
About NewPage Corp
Headquartered in Miamisburg, Ohio, NewPage Corporation was the
leading producer of printing and specialty papers in North
America, based on production capacity, with $3.6 billion in net
sales for the year ended Dec. 31, 2010. NewPage owns paper mills
in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and
Nova Scotia, Canada.
NewPage Group, NewPage Holding, NewPage, and certain of their U.S.
subsidiaries commenced Chapter 11 voluntary cases (Bankr. D. Del.
Case Nos. 11-12804 through 11-12817) on Sept. 7, 2011. Its
subsidiary, Consolidated Water Power Company, is not a part of the
Chapter 11 proceedings.
Separately, on Sept. 6, 2011, its Canadian subsidiary, NewPage
Port Hawkesbury Corp., brought a motion before the Supreme Court
of Nova Scotia to commence proceedings to seek creditor protection
under the Companies' Creditors Arrangement Act of Canada. NPPH is
under the jurisdiction of the Canadian court and the court-
appointed Monitor, Ernst & Young in the CCAA Proceedings.
Initial orders were issued by the Supreme Court of Nova Scotia on
Sept. 9, 2011 commencing the CCAA Proceedings and approving a
settlement and transition agreement transferring certain current
assets to NewPage against a settlement payment of $25 million and
in exchange for being relieved of all liability associated with
NPPH. On Sept. 16, 2011, production ceased at NPPH.
NewPage originally engaged Dewey & LeBoeuf LLP as general
bankruptcy counsel. In May 2012, Dewey dissolved and commenced
its own Chapter 11 case. Dewey's restructuring group led by
Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and Philip M.
Abelson, Esq., moved to Proskauer Rose LLP. In June, NewPage
sought to hire Proskauer as replacement counsel.
NewPage is also represented by Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, as
co-counsel. Lazard Freres & Co. LLC is the investment banker, and
FTI Consulting Inc. is the financial advisor. Kurtzman Carson
Consultants LLC is the claims and notice agent.
In its balance sheet, NewPage disclosed $3.4 billion in assets and
$4.2 billion in total liabilities as of June 30, 2011.
The Official Committee of Unsecured Creditors selected Paul
Hastings LLP as its bankruptcy counsel and Young Conaway Stargatt
& Taylor, LLP to act as its Delaware and conflicts counsel.
An affiliate, Newpage Wisconsin System Inc., disclosed
$509,180,203 in liabilities in its schedules.
NEWPAGE CORP: AlixPartners, Goldman Directors Named to Board
------------------------------------------------------------
NewPage Corporation on Dec. 21 unveiled the members of its new
Board of Directors.
Mark A. Angelson, former Chicago Deputy Mayor and chief executive
officer of RR Donnelley who also led World Color Press out of
bankruptcy and guided its combination with Quad/Graphics, has been
named chairman. He will be joined by paper industry leaders
Robert M. Amen, former president of International Paper Company
and John F. McGovern, former chief financial officer of Georgia
Pacific Corporation.
Robert J. Bass, a member of the audit committee of Groupon and a
recently retired vice chairman of Deloitte LLP, also has been
named to the board, along with Paul E. Huck, senior vice president
and chief financial officer of Air Products & Chemicals, Inc.,
Lisa J. Donahue, managing director in the Turnaround and
Restructuring Practice of AlixPartners LLC, and Eric D. Muller,
managing director in the Principal Investment Area of Goldman
Sachs.
George F. Martin, chief executive officer for NewPage, is the only
continuing member of the board.
NewPage on Friday said it has completed its financial
restructuring and has officially emerged from Chapter 11
bankruptcy protection pursuant to its Modified Fourth Amended
Chapter 11 Plan, confirmed on Dec. 14, by the U.S. Bankruptcy
Court for the District of Delaware in Wilmington.
About NewPage Corp
Headquartered in Miamisburg, Ohio, NewPage Corporation was the
leading producer of printing and specialty papers in North
America, based on production capacity, with $3.6 billion in net
sales for the year ended Dec. 31, 2010. NewPage owns paper mills
in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and
Nova Scotia, Canada.
NewPage Group, NewPage Holding, NewPage, and certain of their U.S.
subsidiaries commenced Chapter 11 voluntary cases (Bankr. D. Del.
Case Nos. 11-12804 through 11-12817) on Sept. 7, 2011. Its
subsidiary, Consolidated Water Power Company, is not a part of the
Chapter 11 proceedings.
Separately, on Sept. 6, 2011, its Canadian subsidiary, NewPage
Port Hawkesbury Corp., brought a motion before the Supreme Court
of Nova Scotia to commence proceedings to seek creditor protection
under the Companies' Creditors Arrangement Act of Canada. NPPH is
under the jurisdiction of the Canadian court and the court-
appointed Monitor, Ernst & Young in the CCAA Proceedings.
Initial orders were issued by the Supreme Court of Nova Scotia on
Sept. 9, 2011 commencing the CCAA Proceedings and approving a
settlement and transition agreement transferring certain current
assets to NewPage against a settlement payment of $25 million and
in exchange for being relieved of all liability associated with
NPPH. On Sept. 16, 2011, production ceased at NPPH.
NewPage originally engaged Dewey & LeBoeuf LLP as general
bankruptcy counsel. In May 2012, Dewey dissolved and commenced
its own Chapter 11 case. Dewey's restructuring group led by
Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and Philip M.
Abelson, Esq., moved to Proskauer Rose LLP. In June, NewPage
sought to hire Proskauer as replacement counsel.
NewPage is also represented by Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, as
co-counsel. Lazard Freres & Co. LLC is the investment banker, and
FTI Consulting Inc. is the financial advisor. Kurtzman Carson
Consultants LLC is the claims and notice agent.
In its balance sheet, NewPage disclosed $3.4 billion in assets and
$4.2 billion in total liabilities as of June 30, 2011.
The Official Committee of Unsecured Creditors selected Paul
Hastings LLP as its bankruptcy counsel and Young Conaway Stargatt
& Taylor, LLP to act as its Delaware and conflicts counsel.
An affiliate, Newpage Wisconsin System Inc., disclosed
$509,180,203 in liabilities in its schedules.
NEW YORK SPOT: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: New York Spot Inc.
3317 Avenue N
Brooklyn, NY 11234
Bankruptcy Case No.: 12-48530
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Jerome Feller
Debtor's Counsel: Kevin J. Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
1501 Broadway, 22nd Floor
New York, NY 10036
Tel: (212) 301-6944
Fax: (212) 422-6836
E-mail: KNash@gwfglaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Yehuda Nelkenbaum, president.
Affiliates that filed separate Chapter 11 petitions are:
Petition
Debtor Case No. Date
------ -------- --------
Martense New York, Inc. 09-48910 10/09/09
Votvot, Inc. 12-47878 11/14/12
NORTHSTAR AEROSPACE: PwC Canada Approved as Expert Witness
----------------------------------------------------------
The Bankruptcy Court for the District of Delaware authorized NSA
(USA) Liquidating Corp., et al., to employ PricewaterhouseCoopers
LLP as expert witness in arbitration proceedings with respect to
the sale of the Debtors' assets.
As reported by the Troubled Company Reporter on Dec. 14, 2012,
the Debtors related that PwC Canada is being jointly retained by
the Canadian Monitor. The Canadian Monitor is responsible for
paying half of PwC Canada's fees and expenses, and the Debtors are
responsible for paying the other half of PwC Canada's fees and
expenses for the engagement. The Canadian Monitor has paid PwC
Canada's initial retainer and will pay PwC Canada going forward in
accordance with its engagement letter.
PwC Canada will, among other things:
a. conduct review and analysis of sale closing issues and
prepare an expert report for arbitration;
b. review the position of the purchaser regarding sale closing
issues and prepare a critique report; and
c. provide additional services as requested from time to time
by the Debtors and agreed to by PwC Canada.
Michael Dobner, an associate partner in PwC Canada's Valuation,
Forensic and Disputes Group, tells the Court that an initial
retainer of C$15,000 plus applicable taxes will be paid upon
signature of the engagement letter. Further retainer amounts will
be requested and paid as previous retainer is exhausted.
PwC Canada's standard hourly rates are:
Partner/Associate Partner $750
Vice President/Senior Manager $650
Manager $465
Senior Associate $370
Associate $235
Other $125
The Debtors have also agreed to indemnify and to make certain
payments to PwC Canada, for any and all third party claims,
liabilities, losses, damages, costs and expenses relating to the
services provided.
To the best of the Debtors' knowledge, PwC Canada is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Northstar Aerospace
Headquartered in Chicago, Illinois, Northstar Aerospace --
http://www.nsaero.com/-- is an independent manufacturer of flight
critical gears and transmissions. With operating subsidiaries in
the United States and Canada, Northstar produces helicopter gears
and transmissions, accessory gearbox assemblies, rotorcraft drive
systems and other machined and fabricated parts. It also provides
maintenance, repair and overhaul of components and transmissions.
Its plants are located in Chicago, Illinois; Phoenix, Arizona and
Milton and Windsor, Ontario. Northstar employs over 700 people
across its operations.
Northstar Aerospace, along with affiliates, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 12-11817) in Wilmington
on June 14, 2012, to sell its business to affiliates of Wynnchurch
Capital, Ltd., absent higher and better offers. Certain Canadian
affiliates also sought protection pursuant to the Companies'
Creditors Arrangement Act, R.S.C.1985, c. C-36, as amended.
In July, the Bankruptcy Court approved the sale to Wynnchurch's
unit, Heligear Acquisition Co. and Heligear Canada Acquisition
Corporation for a total of $70 million, or to the highest bidder
at auction. Wynnchurch closed the deal in September.
The names of the Debtors were changed as contemplated by the
approved sale transaction.
Attorneys at SNR Denton US LLP and Bayard, P.A. serve as counsel
to the Debtors. The Debtors have obtained approval to hire Logan
& Co. Inc. as the claims and notice agent.
As of March 31, 2012, Northstar disclosed total assets of
$165.1 million and total liabilities of $147.1 million.
Approximately 60% of the assets and business are with the U.S.
debtors.
No creditors' committee has been appointed in the cases. No
trustee or examiner has been appointed.
NUVILEX INC: Delays Form 10-Q Report for Oct. 31 Quarter
--------------------------------------------------------
Nuvilex, Inc., was unable to file its quarterly report on Form 10-
Q for the period ended Oct. 31, 2012, within the prescribed time
period because a new assessment of the Preferred stock was
recognized last week which points to a potential change to the
Company's filings. Management believes it is important to fully
analyze this issue.
In order to provide the best data to the Company's shareholders,
the Company is "filing an extension to make certain this issue is
completely resolved and presented properly and disclosed fully.
The analyses are near completion and data presentations are being
finalized."
About Nuvilex Inc.
Silver Spring, Md.-based Nuvilex, Inc.'s current strategy is to
focus on developing and marketing products designed to improve the
health and well-being of those who use them. The Company reported
a net loss of $1.89 million on $66,558 of total revenue for the
year ended April 30, 2012, compared with a net loss of $1.39
million on $125,997 of total revenue during the prior year. The
Company's balance sheet at July 31, 2012, showed $2.23 million
in total assets, $4.02 million in total liabilities, $580,000 in
preferred stock, and a $2.37 million total stockholders' deficit.
Robison, Hill & Co., issued a "going concern" qualification on the
consolidated financial statements for the year ended April 30,
2012, citing recurring losses from operations which raises
substantial doubt about the Company's ability to continue as a
going concern.
ORIENTAL FINANCIAL: S&P Keeps 'BB+' Counterparty Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services kept its 'BB+' counterparty
credit rating on Puerto Rico-based regional banking company
Oriental Financial Group on CreditWatch with negative
implications. Following the acquisition, $50 million of
subordinated notes issued by BBVA PR are now obligations of
Oriental Bank & Trust.
"The CreditWatch action follows Oriental's announcement that it
has completed its previously announced acquisition of the Puerto
Rico-based operations of Banco Bilbao Vizcaya Argentaria S.A.
(BBVA S.A.). These consist of all of the outstanding common stock
of BBVAPR Holding Corp. (the sole shareholder of Banco Bilbao
Vizcaya Argentaria Puerto Rico (BBVA PR), a Puerto Rico-chartered
commercial bank, and BBVA Seguros Inc., a subsidiary offering
insurance services) and BBVA Securities of Puerto Rico Inc., a
registered broker-dealer, for $500 million in cash. Immediately
following the closing of the acquisition, BBVA PR merged into
Oriental Bank & Trust, a wholly owned subsidiary of Oriental, with
Oriental Bank continuing as the surviving entity," S&P said.
"We expect that Oriental will be able to successfully integrate
BBVA PR given its knowledge of the local market, similar
geographic footprint, and experience integrating Eurobank, which
it acquired in 2010 in a Federal Deposit Insurance Corp.-supported
transaction," said Standard & Poor's credit analyst Robert Hansen.
"We will evaluate the ultimate business and financial profiles of
the combined entity, as well as interim financial results, to
update the rating on the company. We will also evaluate Oriental's
plans regarding the integration, branding, advertising, and
marketing of the combined companies. We could affirm the rating on
Oriental or lower it by no more than two notches to 'BB-', based
on the results of our assessment of the pro forma capital
structure, interim financial results, and our updated financial
projections."
PEAK RESORTS: Wants to Hire Bonadio & Co as Accountant
------------------------------------------------------
Peak Resorts, Inc., et al., seek permission from the Hon. Margaret
Cangilos-Ruiz of the U.S. Bankruptcy Court for the Northern
District of New York to employ Bonadio & Co., LLP, as accountant.
Bonadio will:
a. prepare federal and New York State income tax returns for
the year ending Sept. 30, 2012, and going forward for the
Debtors; and
b. perform audits in accordance with generally accepted
auditing standards of the financial statements of: (i)
Hope Lake Investors, LLC, and (ii) the consolidated
financial statements of Peak Resorts, Inc., for the year
ended Sept. 30, 2012, prepared in accordance with
generally accepted accounting principles.
Bonadio believes that the work will be completed at the
approximate costs:
Peak Resorts
------------
a. audit of financial statements for the year-ended Sept. 30,
2012: $25,000
b. preparation of Federal and New York State Income Tax
Returns for the year ended Sept. 30, 2012: $3,000
Hope Lake
---------
a. audit of financial statements for the year ended Sept. 30,
2012: $25,000
b. preparation of Federal and New York State Income Tax
Returns for the year ended Sept. 30, 2012: $3,000
Out-of-pocket travel costs which will be billed in addition to the
fees will not exceed $2,000.
Prior to commencement of this engagement, Bonadio has required a
$15,000 retainer to be paid. These funds will be held in escrow
by Bonadio until the accountant is awarded fees by the Court.
James J. Zielinski, a partner at Bonadio, the firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
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.
PHIL'S CAKE: Has OK to Hire Baumann Raymondo to Audit 401(k) Plan
-----------------------------------------------------------------
Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc.,
obtained permission from the U.S. Bankruptcy Court for the Middle
District to employ Baumann Raymondo, a Skoda Minotti CPA Firm, as
401(k) Plan Audit Accountants to assist the Debtor in complying
with the Department of Labor's Rules and Regulations for Reporting
and Disclosure under ERISA in connection with the required filing
of a Form 5500 and other supporting documents.
As reported by the Troubled Company Reporter on Dec. 6, 2012, the
primary services to be performed by Baumann Raymondo in connection
with their retention, if approved by the Court, will be to conduct
an audit of (i) the 401(k) statements of net assets available for
benefits of the Plan as of Dec. 31, 2011, and (ii) the related
statements of changes in net assets available for benefits of that
year. Additionally, Baumann Raymondo will also review the
supplemental information accompanying the financial statements.
About Alessi's Bakeries
Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a
family-owned bakery and catering business owned and operated in
Tampa, Fla., by four generations of the Alessi family. The
operations have grown from a small bakery delivering bread by
horse and wagon, to the current 100,000 square foot manufacturing
facility serving retail customers nationwide, with a retail
location maintaining and continuing its historic traditions in
Tampa.
Alessi's operates from two locations: a manufacturing facility and
a retail bakery. The Eagle Trail manufacturing facility is located
at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a
100,000 sq. ft. building which houses various production lines
including five ovens, 40,000 sq. ft. of refrigerated space with
four walk-in freezers and two coolers, and 20,000 sq. ft. of raw
material and packing supplies warehouse space. Alessi's also
operates a retail bakery facility, located at 2909 West Cypress
Street, Tampa. Alessi's owns both locations.
As of the Petition Date, Alessi's estimates that it has assets of
roughly $14.5 million and liabilities of roughly $14.7 million.
Liabilities include $5.9 million owing to Zions. There is another
$3 million owing to the Small Business Administration and $820,000
to trade suppliers.
Alessi's filed for bankruptcy to address the over-leveraging due
to the Eagle Trail Facility acquisition and the inability fully
and timely to service debt during the period in which sales
dropped.
Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case
No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May
oversees the case. Harley E. Riedel, Esq., at Stichter Riedel
Blain & Prosser, P.A., serves as the Debtor's counsel. The
petition was signed by Philip Alessi, Jr., president.
PHIL'S CAKE: Wants to Hire Rick Fernandez as Property Manager
-------------------------------------------------------------
Phil's Cake Box Bakeries, Inc., dba Alessi's Bakery, has asked for
permission from the U.S. Bankruptcy Court for the Middle District
of Florida to employ Rick Fernandez as rental real estate property
manager for rented lots nunc pro tunc to the Petition Date.
Alessi's operates from two locations: a manufacturing facility and
a retail bakery. The retail bakery facility is located at 2909
West Cypress Street, Tampa, Florida. Between 1995 and 2005, the
Debtor acquired a number of parcels in the area surrounding the
Retail Bakery. A number of parcels were also acquired during that
time period by an affiliate of the Debtor, Alessi Properties, Inc.
The parcels fall into the following categories: (i) vacant lots
with no improvements; (ii) improved lots which are unrented or
unoccupied; and (iii) improved lots rented to unrelated tenants.
The Rented Lots currently are rented to separate tenants for a
total, collective monthly rental amount of approximately $2,150.
Two of the Rented Lots, accounting for $1,450 of the Rental
Income, are subject to liens in favor of Heritage Bank. The
Debtor has sought authority to abandon the Heritage Bank Lots to
Heritage Bank on a consensual basis. Effective upon the
abandonment: (i) the Debtor will remit to Heritage Bank any of the
post-petition Rental Income attributable to the Heritage Bank Lots
received by the Debtor, and (ii) Fernandez will no longer serve as
property manager for the Heritage Bank Lots.
The Debtor anticipates that Mr. Fernandez may render these
property management services:
(a) collection of rent, and remittance of rent to the
Debtor;
(b) coordinate any necessary maintenance;
(c) report to the Debtor as to efforts to lease vacant
properties; and
(d) perform such other services requested by the Debtor with
respect to the Rented Lots.
For the services, the Debtor proposes to pay Mr. Fernandez a
commission equal to 10% of the monthly rents received from the
Rented Lots.
To the best of the Debtor's knowledge, Mr. Fernandez is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Alessi's Bakeries
Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a
family-owned bakery and catering business owned and operated in
Tampa, Fla., by four generations of the Alessi family. The
operations have grown from a small bakery delivering bread by
horse and wagon, to the current 100,000 square foot manufacturing
facility serving retail customers nationwide, with a retail
location maintaining and continuing its historic traditions in
Tampa.
Alessi's operates from two locations: a manufacturing facility and
a retail bakery. The Eagle Trail manufacturing facility is located
at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a
100,000 sq. ft. building which houses various production lines
including five ovens, 40,000 sq. ft. of refrigerated space with
four walk-in freezers and two coolers, and 20,000 sq. ft. of raw
material and packing supplies warehouse space. Alessi's also
operates a retail bakery facility, located at 2909 West Cypress
Street, Tampa. Alessi's owns both locations.
As of the Petition Date, Alessi's estimates that it has assets of
roughly $14.5 million and liabilities of roughly $14.7 million.
Liabilities include $5.9 million owing to Zions. There is another
$3 million owing to the Small Business Administration and $820,000
to trade suppliers.
Alessi's filed for bankruptcy to address the over-leveraging due
to the Eagle Trail Facility acquisition and the inability fully
and timely to service debt during the period in which sales
dropped.
Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case
No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May
oversees the case. Harley E. Riedel, Esq., at Stichter Riedel
Blain & Prosser, P.A., serves as the Debtor's counsel. The
petition was signed by Philip Alessi, Jr., president.
PHOENIX LIFE: S&P Cuts Rating on Outstanding Surplus Notes to 'B-'
------------------------------------------------------------------
Standard & Poor's Ratings Services corrected its rating on Phoenix
Life Insurance Co.'s (PLIC) outstanding surplus notes by lowering
the subordinated rating to 'B-' from 'B'.
"Under our current hybrid criteria, surplus notes from companies
with noninvestment-grade issuer credit ratings (ICRs) are rated
three notches below the ICR (two notches for subordination and one
notch for deferability), but our rating on the surplus notes was
only two notches below our ICR on PLIC. The action corrects this
error," S&P said.
RATINGS LIST
Phoenix Life Insurance Co.
Counterparty Credit Rating BB-/Watch Neg/--
Ratings Lowered To From
Phoenix Life Insurance Co.
Subordinated Debt B-/Watch Neg B/Watch Neg
PINNACLE AIRLINES: DIP Lender Extends Sec. 1113 Deadline to Jan 17
------------------------------------------------------------------
Pinnacle Airlines Corp. and Delta Air Lines, Inc., entered into a
Fourth Amendment to Senior Secured Super-Priority Debtor-in-
Possession Credit Agreement pursuant to which the Credit Agreement
was modified to extend the date by which the Bankruptcy Court will
enter a final order granting the Section 1113 Motions or a final
order approving a settlement regarding the modification of the
Company's collective bargaining agreements from Dec. 13, 2012 (90
days following the date the Company's Section 1113 Motion was
filed) to a date no later than Jan. 17, 2013.
About Pinnacle Airlines
Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/--
a $1 billion airline holding company with 7,800 employees, is the
parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.;
and Colgan Air, Inc. Flying as Delta Connection, United Express
and US Airways Express, Pinnacle Airlines Corp. operating
subsidiaries operate 199 regional jets and 80 turboprops on more
than 1,540 daily flights to 188 cities and towns in the United
States, Canada, Mexico and Belize. Corporate offices are located
in Memphis, Tenn., and hub operations are located at 11 major U.S.
airports.
Pinnacle Airlines Inc. and its affiliates, including Colgan Air,
Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East
Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr.
S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012.
Judge Robert E. Gerber presides over the case. Lawyers at Davis
Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve
as the Debtors' counsel. Barclays Capital and Seabury Group LLC
serve as the Debtors' financial advisors. Epiq Systems Bankruptcy
Solutions serves as the claims and noticing agent. The petition
was signed by John Spanjers, executive vice president and chief
operating officer.
Pinnacle Airlines' balance sheet at Sept. 30, 2011, showed $1.53
billion in total assets, $1.42 billion in total liabilities and
$112.31 million in total stockholders' equity. Debtor-affiliate
Colgan Air, Inc. disclosed $574,482,867 in assets and $479,708,060
in liabilities as of the Chapter 11 filing.
Delta Air Lines, Inc., the Debtors' major customer and post-
petition lender, is represented by David R. Seligman, Esq., at
Kirkland & Ellis LLP.
The official committee of unsecured creditors tapped Morrison &
Foerster LLP as its counsel, and Imperial Capital, LLC, as
financial advisors.
Pinnacle has the exclusive right to propose a reorganization plan
until Jan. 25, 2013.
PINNACLE ENTERTAINMENT: S&P Puts BB- Corp. Credit Rating on Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'BB-' corporate credit rating, on both Pinnacle Entertainment
Inc. and Ameristar Casinos Inc. on CreditWatch with negative
implications.
"The CreditWatch listings follow Pinnacle's announcement that it
plans to acquire Ameristar. Based on the announced terms, the
transaction values Ameristar at $2.8 billion and will add roughly
$1 billion in additional debt. This translates into an additional
1.5x of leverage based on Pinnacle and Ameristar's combined EBITDA
for the 12 months ended Sept. 30, 2012, and excluding synergies
that Pinnacle expects to be able to achieve. Based on our current
performance expectations and capital spending assumptions for both
companies over the next few years, we expect this transaction
would result in consolidated leverage increasing to the mid- to
high-6x area as the combined company completes several new
developments. While we would expect the company to deleverage
quickly following the opening of these new properties, leverage
sustained in the mid- to high-6x area over the near term is
somewhat weak for the companies' current ratings, in our view,"
S&P said.
"In addition to the increase in leverage, an acquisition of this
size creates some degree of integration risk. We believe these
risks are partially mitigated by the fact that the acquisition
will improve the overall business risk profile of Pinnacle by
substantially growing its asset base and adding additional high-
quality assets to its portfolio, expand its geographic diversity,
and strengthen margins, given Ameristar's EBITDA margins compare
favorably with other U.S. commercial gaming operators," S&P said.
"In resolving the CreditWatch listing, we will monitor the
companies' ability to address various closing conditions and
receive the required regulatory approvals; update our performance
expectations for the combined company; and meet with management to
discuss integration plans and potential synergies, near- and
longer-term growth objectives, and financial policy. If a
downgrade for the combined entity is the outcome of our analysis,
it would be limited to one notch," S&P said.
PRESSURE BIOSCIENCES: Stockholders Elect 2 Directors to Board
-------------------------------------------------------------
Pressure BioSciences, Inc., held a special meeting in lieu of the
annual meeting of stockholders on Dec. 13, 2012. At the Special
Meeting, the Company's stockholders voted to elect Wayne Fritzsche
and Jeffrey N. Peterson to the Company's Board of Directors. The
stockholders also ratified the appointment of Marcum LLP as the
Company's independent registered public accounting firm for the
fiscal year ending Dec. 31, 2013.
About Pressure Biosciences
Pressure BioSciences, Inc., headquartered in South Easton,
Massachusetts, holds 14 United States and 10 foreign patents
covering multiple applications of pressure cycling technology in
the life sciences field.
As reported by the Troubled Company Reporter on March 2, 2012,
Boston-based Marcum LLP, expressed substantial doubt about
Pressure Biosciences' ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has had
recurring net losses and continues to experience negative cash
flows from operations.
The Company's balance sheet at Sept. 30, 2012, showed
$1.91 million in total assets, $2.64 million in total liabilities
and a $730,839 total stockholders' deficit.
PRESTIGE BRANDS: S&P Revises Outlook on 'B+' CCR to Stable
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on Irvington, N.Y.-based Prestige Brands Inc. and
revised the outlook to stable from negative.
"At the same time, we affirmed the 'BB-' issue-level ratings (one
notch higher than the corporate credit rating) on the company's
$660 million senior secured term loan due 2019 and the $250
million senior secured notes due 2018. The recovery ratings remain
'2', indicating our expectation for substantial (70% to 90%)
recovery in the event of a payment default," S&P said.
"In addition, we affirmed the 'B-' issue-level rating (two notches
below corporate credit rating) on the company's $250 million new
senior unsecured notes. The recovery rating remains '6',
indicating our expectation for negligible recovery (0-10%) in the
event of payment default," S&P said.
"The outlook revision reflects our expectation that Prestige
Brands will continue to strengthen its credit measures through the
end of fiscal 2013 and in fiscal 2014," said Standard & Poor's
credit analyst Mark Salierno. "During this time we expect
operating performance will remain steady and the company will
further apply free cash flow to debt repayment."
"The company has improved credit measures faster than Standard &
Poor's previous forecast, which includes a pro forma ratio of
total debt to EBITDA of about 4.8x; our earlier projection called
for leverage to fall below 5x by the end of fiscal 2013 (ended
March 31, 2013). We now believe leverage will be in the low-4x
area by the end of fiscal 2014," S&P said.
"The ratings on Prestige Brands reflect Standard & Poor's view
that the company's financial risk profile will remain 'aggressive'
over the next year. We believe credit metrics will remain weak and
that the company will continue to maintain its financial policy
for the foreseeable future, actively pursuing an acquisition-based
growth strategy and utilizing debt as its primary source to fund
such transactions," S&P said.
"We continue to view the company's business risk profile as 'weak'
because of the company's niche position in a highly competitive
OTC health care and household consumer products market. At the
same time, we view Prestige's management and governance to be
'fair.' Our assessment recognizes management's demonstrated
ability at integrating its recent acquisitions without material
disruption to date. Prestige acquired many of its brands from
larger competitors who underinvested in them because of the
brands' limited potential to expand globally. The company's
strategy is to develop new product innovations for these brands
and, with increased marketing spending, boost performance, most
notably with respect to its core OTC brands," S&P said.
"The rating outlook is stable. We believe Prestige Brands' credit
protection measures will gradually improve over the next two years
given the successful integration of the GSK brands and our
expectation for continued debt reduction over the next 12 months,"
S&P said.
PTC ALLIANCE: Moody's Reinstates 'B2' Corp. Family Rating
---------------------------------------------------------
Moody's Investors Service reinstated the B2 Corporate Family
Rating for PTC Alliance Holdings Corporation. Moody's also
assigned a B2 Probability of Default Rating and a B3 rating to the
company's $120 million Senior Secured Term Loan B facility. The
term loan will consist of a $70 million tranche due in 2016 and a
$50 million tranche due in 2018. Proceeds from the term loan
facility will be used for selective share repurchases and for
general corporate purposes. The rating outlook is stable.
The following ratings/assessments were affected by this action:
Corporate Family Rating reinstated at B2;
Probability Default Rating assigned at B2;
Senior Secured Term Loan B1 due 2016 rated B3 (LGD4, 69%)
Senior Secured Term Loan B2 due 2018 rated B3 (LGD4, 69%)
Ratings Rationale
The B2 corporate family rating reflects PTC Alliance Corporation's
modest size relative to other rated steel companies, its reliance
on a few top customers for a material portion of its sales,
exposure to the cyclicality of the steel industry, and Moody's
expectations that the company will generate limited free cash flow
due to its plan to invest in additional capacity to diversify its
tubular product offering. These factors are somewhat balanced by
the company's healthy margins, leading position in niche markets,
strong blue chip customer base and moderate debt leverage.
PTC was formed in 2000 by the merger of Pittsburgh Tube company
and J.H. Roberts Industries. The company's strategy is to pursue
niche areas of the steel fabrication industry by employing
differentiated steelmaking technologies. PTC has been controlled
by Black Diamond Management, a private equity firm, since 2003.
The company filed a voluntary bankruptcy in 2006 to restructure
its balance sheet, and again in 2009 due to the severe recession,
which led to the elimination of union contracts, closure of
unprofitable facilities and a lower cost structure. These actions
have resulted in a more profitable organization with above average
margins for the steel industry. However, the company remains
susceptible to the volatility of steel prices and cyclical end
markets including the automotive, agriculture and construction
sectors.
The stable outlook presumes the company's operating results will
remain relatively stable or gradually improve over the next 12 to
18 months and result in gradually improved credit metrics. It also
assumes the company will carefully balance its leverage and other
credit metrics with its growth strategy.
An upgrade in the near-term is not likely given that PTC's scale
remains a limitation and recent operating results have been weak.
However, the ratings could experience upward pressure if the
company is able to grow organically, sustain its current margins,
generate positive free cash flow, and execute well on its
expansion strategy. Improved credit metrics such as a leverage
ratio below 3.0x and EBIT-to-interest expense trending above 4.0x
could put upward pressure on the rating.
Negative rating pressure could develop if deteriorating operating
results, debt-financed acquisitions, shareholder distributions or
other factors result in the company's leverage ratio exceeding
4.0x or EBIT-to-interest expense trending below 2.5x. An adverse
change in the company's liquidity position could also weigh on the
rating.
The principal methodology used in rating PTC Alliance Holdings
Corp. was the Global Steel Industry Methodology published in
October 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.
PTC Alliance Holdings Corporation, headquartered in Wexford, PA,
is a leading manufacturer of welded and cold drawn mechanical
steel tubing and tubular shapes, fabricated parts, precision
components and chrome-plated rod. PTC's major end markets include
construction and agricultural equipment, automotive and heavy
truck components and industrial machinery. PTC generated $413
million in revenue for the 12-month period ending September 30,
2012.
PYRAMID CONNECTION: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------------
Debtor: Pyramid Connection LLC
6301 Highway 39 North
Meridian, MS 39305
Bankruptcy Case No.: 12-52572
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Southern District of Mississippi
(Gulfport Divisional Office)
Judge: Neil P. Olack
Debtor's Counsel: J. Walter Newman, IV, Esq.
NEWMAN & NEWMAN
248 East Capitol Street, Suite 539
Jackson, MS 39201
Tel: (601) 948-0586
Fax: (601) 948-0588
E-mail: wnewman95@msn.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
In its list of 20 largest unsecured creditors, the Company
disclosed one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Lauderdale County Tax 2010 and 2011 $42,000
Collector taxes
P.O. Box 5205
Meridian, MS 39302-5205
The petition was signed by William E. Jackson, Jr., owner.
QUEENS BALLPARK: S&P Lowers Rating on $547MM PILOT Bonds to 'BB'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its underlying rating
on the New York City Industrial Development Agency's (NYCIDA)
series 2006 $547.6 million payments-in-lieu-of-taxes (PILOT)
bonds, $58.4 million installment purchase bonds, $7.1 million
lease revenue bonds, and $82.28 million PILOT bonds, 2009 series
to 'BB' from 'BB+.' The outlook is negative.
"The project is a 42,000-seat, open-air baseball stadium called
Citi Field. It is home to Major League Baseball's (MLB) New York
Mets. The project used bond proceeds to fund construction of the
new ballpark in Queens, N.Y. The ballpark is owned by the NYCIDA
and leased under a long-term lease to Queens Ballpark. The initial
lease term is equal to the debt maturity. Queens Ballpark is a
wholly owned subsidiary of Sterling Mets, which owns the Mets.
Queens Ballpark has a sub-lease with the Mets that requires the
Mets to play all home games in the stadium," S&P said.
"NYCIDA is servicing the PILOT, installment purchase, and lease
revenue bonds from PILOTs, and rental payments, respectively,
received from Queens Ballpark. Stadium revenues from luxury suite
premiums, club seats, and specific box seats, concessions,
merchandise, signage and advertising, naming rights, and specific
parking revenues support the PILOT, installment purchase, and rent
payments," S&P said.
"The negative outlook reflects our expectation that the project
cash flow will have slight cash flow declines in the near future
before it begins to stabilize," said Standard & Poor's credit
analyst Jodi Hecht.
"We continue to believe that team performance will drive
attendance and stadium cash flows, which will be a factor if the
team continues to perform poorly. We may lower the rating if cash
flows continue to decline due to a combination of poor team
performance, slow economic recovery, overcapacity in the New York
region, and coverage of all project obligations is less than 1.30x
for more than one year. An upgrade, which we do not expect at this
time, may occur when stadium cash flows improve and stabilize with
coverage of all obligations in excess of 1.70x," S&P said.
RADIO ONE: S&P Alters Outlook on 'B-' Corp Credit Rating to Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its 'B-' rating outlook
on Lanham, Md.-based radio broadcaster Radio One Inc. to stable
from negative. "At the same time, we affirmed all ratings on the
company, including the 'B-' corporate credit rating," S&P said.
"The 'B-' rating and outlook revision to stable reflect our view
that Radio One should be able to maintain adequate liquidity and a
15% margin of compliance with financial covenants under the
amended credit agreement over the next 12-18 months," said
Standard & Poor's credit analyst Chris Valentine.
"The amendment widens the total debt leverage, secured debt
leverage, and interest coverage covenants, and increases the
amount of cash the company can net against debt for covenant
compliance by $10 million, to $35 million. In 2012, the company
elected to receive less than the maximum possible cash
distributions from 50.9%-owned TV One, which will increase in
2013, providing additional headroom against EBITDA declines for
covenant compliance purposes. Nevertheless, we see credit metrics
remaining at levels consistent with a 'highly leveraged' (in
excess of 5x debt to EBITDA) financial risk profile because of the
company's very high debt leverage of roughly 9x and its thin
interest coverage. Radio One's business profile is 'weak' because
of its exposure to advertising cyclicality, the potential for
longer-term structural declines in radio, revenue concentration in
a few markets, and decreased profitability at Reach Media. These
factors more than offset the benefit of the company's 50.9%
ownership in TV One. Our governance assessment is 'fair,'" S&P
said.
"Radio Broadcaster Radio One targets the African-American
audience, and owns 54 radio stations in 16 of the top 50 African-
American markets. Within its radio segment, revenues are
concentrated among four markets: Houston; Washington, D.C.;
Atlanta; and Baltimore, which together account for 54.5% of radio
revenue. It has good positions in most of its markets, and its
radio segment EBITDA margin is comparable to those of peers.
Nevertheless, we view radio as subject to long-term decline
because of advertising migration online and audience migration to
alternative audio entertainment. TV One adds business diversity
and access to a more stable revenue stream, because affiliate fees
are subject to long-term contracts with annual escalators. Radio
One has a 53.5% ownership interest in Reach Media Inc., a
programming syndication business that, in our opinion, now
operates with relatively weak profitability because of declining
demand for syndicated radio programming, together with fixed costs
for talent and entertainment. Interactive One is the company's
online unit, which we expect to generate modest EBITDA in 2012
following losses and heavy investments over the past three years.
The interactive segment contributes less than 5% of total revenue
for the company," S&P said.
RAINBRIDGE LLC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Rainbridge, LLC
dba Best Western - Lake County Inn & Suites
1380 E. Burleigh Blvd.
Tavares, FL 32778
Bankruptcy Case No.: 12-16858
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Middle District of Florida (Orlando)
Debtor's Counsel: Tiffany D. Payne, Esq.
BAKER HOSTETLER LLP
P.O. Box 112
Orlando, FL 32801
Tel: (407) 649-4079
E-mail: tpayne@bakerlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/flmb12-16858.pdf
The petition was signed by Jayesh Patel, managing member.
REHOBOTH MCKINLEY: Fitch Affirms Rating on 2007A Bonds at 'B'
-------------------------------------------------------------
Fitch Ratings has affirmed the rating on the approximately $6.58
million New Mexico Hospital Equipment Loan Council (Rehoboth
McKinley Christian Health Care Services, Inc.) hospital facility
improvement and refunding revenue bonds, series 2007A at 'B'.
The Rating Outlook is Stable.
SECURITY
The bonds are secured by a pledge of revenues and equipment. In
addition, there is a debt service reserve fund.
KEY RATING DRIVERS
VOLATILE FINANCIAL PERFORMANCE WITH RECENT IMPROVEMENT: Rehoboth
McKinley Christian Health Care Services' (Rehoboth) financial
performance has historically been very volatile and reflective of
the challenges of a hospital with a small revenue base and
unfavorable payor mix. Most recently, a number of events caused
significant deterioration to its financial position in fiscal
2011, which has rebounded through the nine months ended Sept. 30,
2012 (interim period). In addition, Rehoboth has announced its
intent to pursue a strategic affiliation, which Fitch views
favorably as it could help to stabilize operations and management
turnover.
PRECARIOUS LIQUIDITY POSITION: Rehoboth has drawn down its cash
position due to weak cash flow with only $1.4 million of
unrestricted cash at Sept. 30, 2012 (9.3 days cash on hand)
compared to $10.4 million at Dec. 31, 2010 (66 days cash on hand).
Although Rehoboth remains in violation of its liquidity covenant,
the failure to meet its days cash on hand requirement does not
result in an event of default.
RELIANCE ON SUPPLEMENTAL FUNDING: Rehoboth remains highly reliant
on sole community provider (SCP) funds and tax revenue from a mill
levy for profitability. SCP funding was restored to historical
levels in fiscal 2012, which contributed to the rebound in
performance through the interim period.
CONTINUED MANAGEMENT TURNOVER: Over Fitch's rating history of
Rehoboth, there has been significant management turnover. The
current CEO is on an interim basis and is expected to remain at
Rehoboth through the spring 2013.
SMALL REVENUE BASE: Fitch believes Rehoboth's small revenue base
remains a key credit concern as the hospital has limited
flexibility to handle adverse events, which was most recently
demonstrated in fiscal 2011 but has also been evident in
Rehoboth's history.
CREDIT PROFILE
Rehoboth's rating history has fluctuated between the 'B' and 'BB'
category since 2005 and reflects the volatility in Rehoboth's
financial performance in addition to constant management turnover.
Since Fitch's last review in June 2012, the interim CFO has since
moved to a consultant position and the comptroller is now serving
as interim CFO. A search is underway for both the CEO and CFO
positions but the interim CEO has committed to stay in his
capacity until spring 2013. The Board of Trustees announced in
October 2012 their intent to explore possible strategic
affiliations. Although management is still in the exploratory
stage, Fitch believes a partnership or strategic affiliation would
be a credit positive.
Financial performance has improved in fiscal 2012 from the very
poor fiscal 2011 performance but still remains very volatile and
dependent on supplemental funding. Supplemental funding in the
form of SCP funds and the mill levy are critical, since without
these funds, Rehoboth would be unprofitable. In fiscal 2011,
there was litigation surrounding the mechanism behind the SCP
funding, which resulted in a delay in the SCP payment. SCP
funding was restored after the state litigation was settled in
late fiscal 2011. Total supplemental funding is expected to be
$12.8 million for fiscal 2012 compared to $8.7 million in fiscal
2011 and $10 million in fiscal 2010. Fitch views the timely and
continued payment of this supplemental funding to be critical to
the stability of Rehoboth's financials.
Rehoboth benefits from a mill levy imposed by the county, which is
included in the total supplemental funding. The funds from the
mill levy totaled $1.6 million in fiscal 2011 compared to $1.4
million in fiscal 2010 and are expected to total about $1.4
million in fiscal 2012. The mill levy expired in 2012 but
McKinley County voters approved the renewal of the mill levy and
changed the language to allow for the hospital to levy up to four
mills from up to two mills. Also, the mill levy now allows for
funds to be used as a match for SCP funding. This change becomes
effective July 1, 2013. Hospital management is meeting with
county officials to discuss its levy request for 2013. Rehoboth's
debt service coverage calculation excludes the mill levy revenue
as a source of funds.
Other financial improvement measures include cost controls
resulting in about $7 million in savings, revenue cycle
modifications increasing cash flow from collections, as well as a
rate increase, which was implemented in July 2012. Although
patient volumes were down about 6% in 2012 from 2011, a reduction
in force completed in August 2012 resulted in improved operations.
At Sept. 30, 2012 (nine-month interim), operating margin improved
to negative 0.5% from negative 10.7% in fiscal 2011. Operating
EBITDA margin was 4.3% at Sept. 30, 2012, also an improvement from
negative 6.4% in fiscal 2011. Management expects break-even
performance for fiscal 2012 and based on current performance,
Fitch believes this is manageable.
Revenue cycle issues and the negative cash flow in fiscal 2011
resulted in a drain on cash to only 5.2 days cash on hand and 13%
cash to debt in fiscal 2011, from 65.9 days and 136.8%,
respectively, the prior year. Unrestricted cash and investments
as of Sept. 30, 2012 resulted in 9.3 days and 21.9% cash to debt
and should further improve by year-end as a portion of the SCP
funding for fiscal 2012 has not yet been received to-date but is
expected prior to year-end. Fitch notes that Rehoboth's liquidity
position is precarious and any deterioration would lead to
negative rating action. Rehoboth has a liquidity covenant of 23
days in fiscal 2012 and 25 days in fiscal 2013. Management does
not expect to meet this covenant in fiscal 2012 but failure to do
so does not constitute an event of default.
Although Rehoboth maintains the dominant market position of 62% in
its service area, the payor mix is challenging with 28.1% of
revenues from Medicaid as of Sept. 30, 2012 and 8.8% self-pay.
Rehoboth's revenue mix is about 36% inpatient and 64% outpatient.
Total debt outstanding is $7.04 million including $6.58 million of
bonds and $463,000 of capital leases. All of the debt is fixed
rate and Fitch used maximum annual debt service (MADS) of
$841,586, which includes the capitalized leases. Because of the
low debt burden, MADS coverage through the nine months ended Sept.
30, 2012 was 3.2x.
The Stable Outlook reflects Fitch's expectation that Rehoboth will
sustain and continue to better its improved financial performance.
No additional debt is expected in the near to medium term.
Rehoboth McKinley Health Care Services, Inc. is a 69-bed general
acute care hospital located in Gallup, New Mexico (138 miles west
of Albuquerque, NM and 180 miles east of Flagstaff, AZ). Rehoboth
changed its fiscal year end in fiscal 2010 to December from
August. Total operating revenue in fiscal 2011 was $64.5 million.
Rehoboth covenants to provide annual financial statements within
30 days after the approval of the report by the state auditor,
which has usually resulted in fairly late receipt of audits.
Rehoboth has also been posting monthly financial statements on
EMMA.
RESIDENTIAL CAPITAL: S&P Withdraws 'D' Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'D' corporate
credit and issue-level, and '6' recovery ratings on Residential
Capital LLC (ResCap).
"ResCap filed for bankruptcy on May 14 due to its inability to
meet debt service obligations. The company is operating under
Chapter 11 bankruptcy protection. The recovery ratings, which were
in place at the time of ResCap's bankruptcy filing, do not comment
on possible steps taken or proposed since the bankruptcy filing
and implications for recovery levels of the outstanding notes,"
S&P said.
RWW GROUP: Case Summary & 11 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: RWW Group, LLC
3611 S. Normal
Chicago, IL 60609
Bankruptcy Case No.: 12-49406
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Jack B. Schmetterer
Debtor's Counsel: Robert R. Benjamin, Esq.
GOLAN & CHRISTIE, LLP
70 West Madison Street, Suite 1500
Chicago, IL 60602
Tel: (312) 263-2300
Fax: (312) 263-0939
E-mail: rrbenjamin@golanchristie.com
Scheduled Assets: $8,000,000
Scheduled Liabilities: $39,349,703
A list of the Company's 11 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/ilnb12-49406.pdf
The petition was signed by Thomas DiPiazza, manager.
SANDRIDGE ENERGY: S&P Puts 'B' Rating on $4.3BB Notes on Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' long-term
corporate credit rating on Oklahoma City-based SandRidge Energy
Inc. "At the same time, we placed our 'B' issue rating on the
company's $4.3 billion of senior unsecured notes on CreditWatch
with negative implications. Upon completion of the transaction
(which we expect in February 2013), we expect to lower the
recovery rating on the notes to '5', resulting in the lowering of
the issue rating to 'B-'. A '5' recovery rating indicates our
expectation of modest (10% to 30%) recovery for lenders in the
event of a default," S&P said.
"The rating action follows the announcement that SandRidge plans
to sell Permian Basin properties for approximately $2.6 billion,"
said Standard & Poor's credit analyst Ben Tsocanos. "The
transaction materially reduces the company's reserves and
production but increases its geographic concentration in the Mid-
Continent Mississippian play and Gulf of Mexico shelf. Sale
proceeds, which we view as reflecting a relatively high valuation,
also provide substantial cash that we expect the company to use to
reduce outstanding debt and fund development of its very sizable
Mississippian acreage position. The company's interest in the
Permian Basin Royalty Trust is unchanged following the sale."
"The ratings on SandRidge reflect Standard & Poor's assessment of
the company's 'weak' business risk profile and 'highly leveraged'
financial risk profile. We base this assessment on what we deem to
be an aggressive growth strategy and financial policies--with
capital spending well in excess of internally generated cash flow.
Somewhat offsetting this, the ratings also reflect the company's
focus on increasing production of oil versus natural gas,
reflecting the weak near-term natural gas prices," S&P said.
"The stable outlook reflects our expectation that SandRidge will
continue to aggressively grow its asset base while not materially
increasing leverage beyond current levels. We would consider
lowering the rating if the company becomes more aggressive in
financing its growth with debt, such that debt to EBITDA increases
to more than 5.5x, without a clear view to deleveraging. We would
consider raising the rating if the company is able to reduce and
maintain adjusted total debt to EBITDA to the low-4x area," S&P
said.
SANTEON GROUP: Adopts 2012 Employee Incentive Stock Option Plan
---------------------------------------------------------------
Santeon Group, Inc.'s 2012 Employee Incentive Stock Option Plan
was adopted pursuant to the written consent of majority
stockholders as of Nov. 23, 2012. The Plan provides for various
types of awards denominated in shares of Company's Common Stock to
employees, officers and employee directors of the Company. The
Plan provides that up to 150,000 shares will be available for
grant pursuant to the various types of awards that may be granted
under the plan.
Reverse Stock Split
On Nov. 23, 2012, the shareholders holding a majority of the
voting power of the Company's outstanding voting stock acted by
written consent approving an amendment to the Company's Amended
and Restated Certificate of Incorporation to (a) effect a reverse
stock split of the Company's common stock by a ratio of up to
1:1000 as will be determined at the sole discretion of the Chief
Executive Officer at any time prior to March 31, 2012, subject to
receiving all requisite approvals and completion of required
notice periods, and (b) reduce the number of authorized shares of
our common stock from 700,000,000 shares to 50,000,000 shares.
On Dec. 10, 2012, the Company's Chief Executive Officer determined
that the reverse stock split ratio will be a ratio of one for four
hundred (1:400).
A complete copy of the Form 8-K is available for free at:
http://is.gd/xZ1oY6
About Santeon Group
Reston, Va.-based Santeon Group, Inc., is a diversified software
products and services company specializing in the transformation
and optimization of business through the deployment or the
development of innovative products and services using Agile
mindsets in the information systems/technology, healthcare,
environmental/energy and media sectors. The Company's clients
include state and local governments, federal agencies and private
sector customers.
As reported by the Troubled Company Reporter on Aug. 24, 2012,
RBSM LLP, in New York, N.Y., expressed substantial doubt about
Santeon's ability to continue as a going concern, following its
audit of the Company's financial position and results of
operations for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company has suffered losses
from operations and is experiencing difficulty in generating
sufficient cash flows to meet its obligations and sustain its
operations.
The Company's balance sheet at Sept. 30, 2012, showed
$1.11 million in total assets, $1.22 million in total liabilities,
and a $110,272 total stockholder's deficit.
SENSATA TECHNOLOGIES: S&P Ups CCR to 'BB' on Reduced Bain Stake
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings, including
the corporate credit rating to 'BB' from 'BB-', on Sensata
Technologies B.V. The outlook is stable. "We are also removing the
ratings from CreditWatch, where we placed them with positive
implications on Dec. 12, 2012," S&P said.
"The upgrade follows the completion of a secondary share offering
that reduces Bain Capital's ownership of publicly traded Sensata
Technologies Holding N.V. (the ultimate parent of rated Sensata
Technologies B.V.) to less than 50%. We believe the offering
provides further evidence of the lessening influence of Bain on
the company's financial policy and supports a one-notch upgrade,"
said Standard & Poor's credit analyst Dan Picciotto. "The ratings
on electronic sensors and controls manufacturer Sensata reflect
the company's 'aggressive' financial risk profile and
'satisfactory' business risk profile. Standard & Poor's believes
credit measures will remain consistent with the rating, including
funds from operations (FFO) to adjusted debt of about 20% and
adjusted debt to EBITDA of about 3.5x."
In 2013, S&P expects Sensata's adjusted EBITDA margin to remain
very good at about 29% and revenue to increase, benefiting from:
-- A continued slow global economic recovery,
-- Global light-vehicle production growth despite potentially
weak conditions in Europe, and
-- The potential to supplement growth through some acquisition
activity.
"Sensata, formerly a division of Texas Instruments Inc., consists
of two business units that manufacture highly engineered
electronic sensors and controls. Our assessment of the company's
management and governance is 'fair.' We expect revenue to approach
$2 billion in 2012. The company is significantly exposed to the
volatility of the global automotive market, which accounts for
more than half of sales. The European auto market is Sensata's
largest single exposure, accounting for 25% of 2011 sales, and we
believe the region presents heightened near-term economic risks,"
S&P said.
"However, we expect Sensata to maintain its No. 1 market share in
most of its products--it is the sole or primary source for most of
its customers. Demand for its products is increasing at a faster
rate than vehicle growth, as sensor content per vehicle rises. We
do not believe growth prospects are as favorable in the controls
portion of the business, but this segment does provide
diversification benefits to the credit profile. The company's
global manufacturing footprint helps it maintain its low-cost
production and leading positions. Sensata has good geographic
diversification: In 2011, about 65% sales were outside of the U.S.
We expect its operating margin to remain solid," S&P said.
"The outlook is stable. We believe credit measures will remain
appropriate for the rating at about 20% FFO to debt and 3.5x debt
to EBITDA. A further upgrade is unlikely until Bain has
significantly further reduced its investment in Sensata and would
depend on our expectation that the company would maintain
appropriate credit measures for a higher rating. A downgrade is
possible if results deteriorated such that we expected FFO of
about 15% or less and debt to EBITDA of 4x or more. This could
occur, for instance, if revenue declines by more than 10% in 2013,
operating margin declines more than 2%, and no debt reduction
takes place. This scenario would likely require global
recessionary conditions causing declines in global light vehicle
production," S&P said.
SIERRA KINGS: S&P Raises Rating on Series 2002 GO Bonds From 'C'
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term rating and
underlying rating (SPUR) to 'A' from 'C' on the Sierra Kings
Health Care District, Calif.'s outstanding series 2002 general
obligation (GO) bonds. The outlook is stable.
"The raised rating reflects the district's exit from bankruptcy
and affiliation with Adventist Health (A/Stable), for which
district voters approved the lease of the district's facilities
and the sale of certain operating assets," said Standard & Poor's
credit analyst Misty Newland. "We understand that under the lease,
entered into in late 2011, Adventist has exclusive control,
possession, occupancy, use, and management of the district's
facilities and licensed operations during the term of the lease,
which expires in 2026 (with a purchase option),"added Ms. Newland.
"The district's facilities include a 49-bed hospital in Reedley, a
birthing center, and five rural health clinics, which will become
part of the Adventist Health Central Valley Network," S&P said.
"The district, with an estimated population of 40,000, encompasses
an area in southeastern Fresno County in California's San Joaquin
Valley. The hospital is located in Reedley, about 30 miles
southeast of Fresno," S&P said.
SMART ONLINE: Sells Additional $275,000 Convertible Note
--------------------------------------------------------
Smart Online, Inc., sold an additional convertible secured
subordinated note due Nov. 14, 2016, in the principal amount of
$275,000 to a current noteholder. The Company is obligated to pay
interest on the New Note at an annualized rate of 8% payable in
quarterly installments commencing March 13, 2013. The Company is
not permitted to prepay the New Note without approval of the
holders of at least a majority of the aggregate principal amount
of the Notes then outstanding.
The Company plans to use the proceeds to meet ongoing working
capital and capital spending requirements.
The sale of the New Note was made pursuant to an exemption from
registration in reliance on Section 4(a)(2) of the Securities Act
of 1933, as amended.
About Smart Online
Durham, North Carolina-based Smart Online, Inc., develops and
markets a full range of mobile application software products and
services that are delivered via a SaaS/PaaS model. The Company
also provides website and mobile consulting services to not-for-
profit organizations and businesses.
The Company's balance sheet at Sept. 30, 2012, showed $1.9 million
in total assets, $27.8 million in total liabilities, and a
stockholders' deficit of $25.9 million.
Cherry, Bekaert & Holland, L.L.P., in Raleigh, North Carolina,
expressed substantial doubt about Smart Online's ability to
continue as a going concern, following the Company's results for
the fiscal year ended Dec. 31 2011. The independent auditors
noted that the Company has suffered recurring losses from
operations and has a working capital deficiency as of Dec. 31,
SMOKY HILL: Case Summary & 6 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Smoky Hill Center, Ltd.
3462 Sagamore Drive
Huntington Beach, CA 92649
Bankruptcy Case No.: 12-35463
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Elizabeth E. Brown
Debtor's Counsel: Lee M. Kutner, Esq.
KUTNER MILLER BRINEN, P.C.
303 E. 17th Ave., Ste. 500
Denver, CO 80203
Tel: (303) 832-2400
E-mail: lmk@kutnerlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's six largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/cob12-35463.pdf
The petition was signed by Peter Yang, president of JJY Corp. and
Trustee of R&J Trust.
SNOHOMISH COUNTY PHD: Fitch Affirms 'B' Rating on $2.9-Mil. Bonds
-----------------------------------------------------------------
Fitch Ratings has taken the following rating action on Snohomish
County Public Hospital District's (PHD) limited tax general
obligation (LTGO) bonds:
-- $2.9 million series 2004 affirmed at 'B'.
The Rating Watch Negative is removed and the bonds are assigned a
Negative Rating Outlook.
SECURITY
The bonds are secured by a full faith and credit general
obligation pledge of the district. The district also irrevocably
pledges to annually levy and collect property taxes within the
constitutional and statutory limits, to pay debt service principal
and interest on the bonds.
KEY RATING DRIVERS
AFFILIATION AGREEMENT REACHED: The removal of the Negative Watch
follows the district's completion of an affiliation agreement with
EvergreenHealth, a public hospital district based in Kirkland,
Washington. The affiliation with EvergreenHealth became effective
in December 2012 and is intended to help stabilize district
operations and provide short-term cash-flow relief.
SEVERE FINANCIAL CHALLENGES REMAIN: The Negative Outlook reflects
the district's continued financial deterioration as a result of
declining utilization, growing losses and poor liquidity. Fitch
believes such weaknesses leave the district vulnerable to
insolvency over the near-to-medium term.
FISCAL IMPROVEMENTS DELAYED: Uncertainty related to the district's
ongoing operations has contributed to the loss of clinical staff
and senior management turnover, impeding efforts to stabilize the
district's finances. Management proposes to ask district voters
to authorize a new operating levy in April 2013, but the prospects
for approval are unclear.
STRONG TAX BASE; LIMITED BENEFIT: Given the weak financial
position, the benefits of the district's GO pledge and the
strength of its underlying tax base are diminished. The current
rating more closely reflects the district's financial operations.
WHAT COULD TRIGGER A RATING ACTION
CONTINUED FINANCIAL DETERIORATION: The district's inability to
stabilize its finances could result in insolvency and further
rating downgrades.
CREDIT PROFILE:
Snohomish County Public Hospital District No. 1 is located in
eastern Snohomish County, Washington, about 30 miles northeast of
Seattle on the outskirts of the Puget Sound region. The district
owns and operates Valley General Hospital, the only acute care
facility in the district, and the Valley General Chemical
Dependency Treatment Center.
AFFILIATION AGREEMENT REACHED
Following several years of efforts to forge new partnerships, the
district executed an affiliation agreement with EvergreenHealth, a
public hospital district based in Kirkland, Washington, in
December 2012. The agreement provides for a multi-year
partnership that is intended to increase utilization and revenues
for both entities, and help stabilize the district's finances. In
addition, EvergreenHealth will pre-pay the district approximately
$1 million for four years of sub-lease expenses under the
agreement, reducing immediate cash-flow pressures. Fitch believes
that these arrangements reduce the district's risk of insolvency
in the short term, but its longer-term prospects remain uncertain.
SEVERE FINANCIAL CHALLENGES REMAIN
Audited results for fiscal 2011 and interim financials for fiscal
2012 show continued deterioration in the district's financial
position, with net assets down 68% (to $3.7 million) since the end
of fiscal 2010. Operating losses also continue to grow and
liquidity has fallen to 13 days of cash on hand as of September
2012. The district's financial position reflects growing weakness
and threatens its long-term viability.
The district expects to ask voters to authorize a new operating
levy in April 2013 which could add raise approximately $2.4
million in annual revenue if approved. Passage of this measure
would improve the district's finances but significant challenges
remain given operating losses that reached $4.5 million in fiscal
2011.
STRONG UNDERLYING TAX BASE OF LIMITED BENEFIT
The district's underlying tax base is large and diverse, and
property tax receipts have been stable. However, given the
district's weak financial position, the strong underlying tax base
and GO pledge is of limited benefit due to the potential
disruption of debt service payments in an insolvency situation.
Direct and overlapping debt levels for the district are moderate
at approximately $4,000 per capita and 2.9% of assessed value.
Amortization is slow as a result of the district's 2009 issuance
of additional GO debt, with 27% of outstanding principal due for
payment within 10 years. Debt service requirements for the
district are small relative to the size of its operations, and
accounted for approximately 3% of expenditures in fiscal 2011.
SPX CORP: Fitch Affirms 'BB+' Issuer Default Rating; Outlook Neg.
-----------------------------------------------------------------
Fitch Ratings has affirmed SPX Corporation's (SPW) Issuer Default
Rating (IDR) and senior secured credit facilities at 'BB+'. The
Rating Outlook is Negative. The ratings cover approximately $2.1
billion of outstanding debt.
SPW's leverage (debt to EBITDA) is high for ratings driven by a
significant decline of EBITDA in 2012 due to unexpected challenges
associated with ClydeUnion's integration, lower product demand due
to downturns in European and global economic markets, and a
divestiture of the Service Solutions business completed in Dec.
2012. Fitch anticipates SPW will significantly reduce its
indebtedness during the fourth quarter of 2012 prepaying $325
million term loans maturing in 2013 and retiring some short term
debt. Despite the anticipated debt reduction, Fitch estimates
SPW's leverage will be approximately 3.9x at the end of 2012,
unchanged from the previous year.
SPW's high leverage is Fitch's primary rating concern. The
company's de-levering process is significantly slower than Fitch's
expectations immediately following ClydeUnion's acquisition.
Fitch will closely monitor SPW's leverage in 2013. Fitch's
expects SPW's leverage will decline to approximately 2.7x, as
measured by Fitch, by the end of 2014 driven by a full integration
of ClydeUnion business which should improve ClydeUnion's lower
than expected margins. SPW may be able to significantly reduce
its leverage by the end of 2013 by pursuing a large cash funded
acquisition or retiring additional debt. Fitch does not expect
SPW to deploy cash in a form of a special dividend or engage in
share repurchases in addition to the already announced plan to
repurchase $275 million worth of outstanding shares.
SPW has good financial flexibility in the near term due to a
significant increase in liquidity which is expected to be more
than $1.3 billion by the year-end. The company has a $1.8 billion
committed senior secured revolving credit facility that expires in
June 2016. The bank facilities include a $300 million domestic
revolver, a $300 million global multicurrency revolver, a $1.0
billion foreign credit instrument facility and a $200.0 million
bi-lateral foreign credit instrument facility. SPX had $799
million in LOCs outstanding as of Sept. 30, 2012. Other sources
of debt financing include up to $130.0 million under a trade
receivables financing agreement.
In addition to strong liquidity, Fitch expects SPW to maintain
gross debt/EBITDA within its targeted range between 1.5x and 2.5x
(as defined in the company's bank credit agreement); anticipated
improvements in operating results in 2013; solid, albeit declining
operating margins; historically positive free cash flow (FCF);
good product and geographic diversification; management's track
record in successfully integrating acquisitions; large installed
base which drives revenues from the higher margin aftermarket
business; and sizable backlog.
The senior unsecured notes are rated one-notch below senior
secured facilities due to their subordinated position to the
latter, which increased significantly with the higher leverage of
the company.
The company has a history of generating relatively strong
operating margins, though they have been declining over the past
several years. In 2011 the company reported 9.5% EBITDA margin
compared to 10.1% in 2010. SPW's margin was 8.6% for the last
twelve months (LTM) ended Sept. 30, 2012. Fitch expects SPW's
2012 EBITDA margin to be lower than that of 2011, however expects
them to it gradually improve beginning 2013. Fitch expects SPW to
generate above $420 million EBITDA (as defined by Fitch) in 2012.
Even though SPW historically generates positive FCF, Fitch expects
the company to report negative FCF in 2012 driven by lower
operating cash flows due to decline in sales, margin pressures and
pension contributions; significantly higher interest expenses; and
a large investment in net working capital for ClydeUnion
acquisition. In 2013, Fitch expects SPW's FCF to be higher than
$200 million driven by improved operating results.
Fitch's Negative Outlook reflects concerns regarding SPW's high
leverage; anticipated negative FCF in 2012; and steady decline in
margins beginning in 2010. The concern about margins is partly
offset by Fitch's expectation that margins will improve in 2013
due to stronger backlog and improvements in operations. Fitch's
other concerns include continued weakness in the global economy;
SPW's significant exposure to Europe; cash deployment strategies
which focus on acquisitions; and underfunded pension and unfunded
other postretirement benefit (OPEB) liabilities, which may
increase at the year-end due to prevailing low interest rate
environment.
SPW mainly utilizes its cash for acquisitions, capital
expenditures, dividends and occasional share repurchases, thought
the company had not repurchased shares in 2010 and 2011. On Feb.
16, 2012, SPW announced a plan to repurchase up to $350 million
worth of shares by Feb. 14, 2013, in accordance with a share
repurchase program authorized by our Board of Directors. As of
Dec. 3, 2012 the company has already repurchased $75 million worth
of shares and plans to repurchase additional $275 million. Fitch
is concerned with this significant share repurchase program given
SPW's high leverage for the ratings. Fitch will closely monitor
SPW's future cash deployment strategies, however, it does not
expect additional share repurchases to be a large part of cash
deployment in the near future.
SPW's domestic pension plans are $325 million underfunded (73%
funded), however approximately $166 of the underfunded position
relates to the plans which are not required to be funded. Total
pension obligations totaled $1,478.2 million the end of 2011.
Fitch does not view the funded status of SPW's pension liabilities
to be a significant credit risk and does not expect the
discretionary contributions to qualified pension plans to be a
significant part of cash deployment. SPW expects to make
approximately $46.8 million contributions to qualified domestic
pension plans. The company did not make pension contributions in
2011 as it contributed approximately $120.0 million to its pension
plans in 2010, including approximately $100 million of
discretionary payments. During the first nine months of 2012, SPW
contributed approximately $39.0 million to its foreign and
qualified domestic pension plans. The underfunded status of all
plans increased to $363 at the end of 2011 from $311 million at
the end of 2010, largely due to the decline in discount rates and
low return on assets.
Future Rating Actions:
The Rating Outlook could be revised to Stable if SPW is able to
reduce leverage to its long-term target range within 12 - 18
months pending the deployment of its large cash balances. Fitch
may consider a negative rating action if:
-- The company continues experiencing margin pressures and
slower product demand in Europe and emerging markets.
-- Leverage remains high for a prolonged period of time or
decreases slower than anticipated.
-- There is an unexpected cash deployment towards shareholders
in form of a special dividend or additional share
repurchases.
Fitch has affirmed the following ratings:
-- IDR at 'BB+';
-- Senior secured bank facilities at 'BB+';
-- Senior unsecured debt at 'BB'.
Rating Outlook is Negative.
STABLEWOOD SPRINGS: Case Summary & 19 Largest Unsecured Creditors
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Debtor: Stablewood Springs Resort, LP
P.O. Box 467
Hunt, TX 78204
Bankruptcy Case No.: 12-53887
Chapter 11 Petition Date: December 17, 2012
Court: U.S. Bankruptcy Court
Western District of Texas (San Antonio)
Judge: Ronald B. King
Debtor's Counsel: David S. Gragg, Esq.
LANGLEY & BANACK, INC.
Trinity Plaza II
745 E Mulberry, Suite 900
San Antonio, TX 78212
Tel: (210) 736-6600
Fax: (210) 735-6889
E-mail: dgragg@langleybanack.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Tom J. Fatjo, Jr., president of WCA
Holdings, Inc.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Stablewood Springs Resort Operations LLC -- --
List of Stablewood Springs Resort's 19 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Estate of Thomas A. Russell, -- $2,537,625
Deceased
808 London Street
Castroville, TX 78009
Captain Ellis Partnership -- $160,000
128 Nimitz Drive
Kerrville, TX 78028
Herb Lipsman, The Health -- $131,295
Club Company
16400 Kensington Drive
Sugar Land, TX 77479
Pacific Life Ins. Co -- $66,427
SSR Furnishings, LLC -- $30,779
Colby Design -- $21,037
The Mathis Group -- $10,430
KGB Texas -- $10,000
The Concrete Shop -- $6,610
Stablewood Springs Private -- $6,000
SRS Ventures LLC -- $3,000
Harbor Linens -- $935
Quality Gutters Systems LP -- $855
Hein Lam Upholstery -- $645
Wallace Jackson & Lohmeyer, PC Legal Fees $564
Mosty Law Firm -- $323
San Antonio Express News -- $155
Kerr County Water Services $125
Bank of the Hills -- $2
STANDARD PACIFIC: Fitch Raises Issuer Default Rating to 'B'
-----------------------------------------------------------
Fitch Ratings has upgraded the Issuer Default Rating (IDR) of
Standard Pacific Corp. (NYSE: SPF) to 'B' from 'B-'. Fitch has
also revised SPF's Rating Outlook to Positive from Stable.
The upgrade reflects SPF's operating performance so far this year
and its robust liquidity position. The rating is also supported
by the company's execution of its business model and geographic
and product line diversity.
Risk factors include the cyclical nature of the homebuilding
industry, SPF's aggressive land strategy, and, although improving,
still high leverage position.
The Positive Outlook takes into account the improving housing
industry outlook for 2013 and also the above average performance
relative to its peers in certain financial, credit and operational
categories.
SPF is focused on growing its operations by investing in new
communities, particularly in land-constrained markets. Following
the significant reduction of its land supply during the 2006 -2009
periods, SPF began to increase its land holdings during 2010, 2011
and 2012. At Sept. 30, 2012, the company had 30,154 lots
controlled, a 12.4% increase over the previous year and 57% growth
over year-end 2009 land holdings. Its owned and optioned lot
positions increased 19% and 18.6%, respectively, as compared to
the third quarter 2011, while its joint venture lot position fell
55.6% year-over-year. Based on the latest twelve month closings,
SPF controlled 9.7 years of land and owned roughly 7.7 years of
land.
SPF increased its average active community count by 17% to 152
during 2011. The company ended the third quarter with 156 active
selling communities, a 2.6% increase over year-end 2011 levels.
The company spent $437 million on land and development during 2011
compared with $336 million expended in 2010 and $158 million in
2009. SPF spent roughly $443 million through the first nine
months of 2012 and expects total spending will be between $600
million and $700 million for the year. This is above the $400
million to $500 million the company had planned to spend earlier
this year.
Fitch is comfortable with SPF's aggressive land strategy given the
company's liquidity position. The company ended the third quarter
of 2012 with $473.9 million of unrestricted cash and $200 million
of availability under its unsecured revolving credit facility.
Subsequent to the end of the third quarter, SPF amended its
revolver, which increased the capacity from $210 million to $350
million and extended the maturity on $320 million of the
commitments from February 2014 to October 2015. SPF's debt
maturities are well-laddered, with only $75 million of debt coming
due through 2015 as of Sept. 30, 2012.
Fitch expects the company will be cash flow negative by about
$250-300 million during 2012 and its cash position will decline to
around $350-400 million at yearend 2012. Fitch anticipates the
company's cash outflow next year will be similar to 2012 levels
and its cash position will decline further to between $75 million
to $100 million at year-end 2013 as the company continues to
invest in land and development. Fitch expects SPF in the
intermediate term will maintain liquidity of at least $400 million
from a combination of cash and revolver availability.
The company continues to have relatively heavy exposure in the
state of California, generating approximately 55% of its year-to-
date revenues and holding about 59% of the dollar value of its
real estate inventory in this state. SPF also has operations in
major metropolitan markets in Texas, Arizona, Nevada, Colorado,
Florida and the Carolinas. The company has a substantial presence
and ranks in the top 10 in most of the markets where it operates.
SPF constructs homes within a wide range of prices and sizes, with
an emphasis on move-up buyers. During 2012, management estimates
that 73% of its deliveries were directed to the move-up/luxury
market, while 27% were to entry-level buyers. By comparison, 67%
of its deliveries during 2010 were to move-up/luxury buyers, while
33% were directed to the entry-level market. The company's
strategy of focusing on the move-up segment has contributed to
above average gross margins and EBITDA margins relative to its
peers.
Fitch's housing forecasts for 2012 have been raised a few times
this year but still assume a below-trend line cyclical rise off a
very low bottom. In a slow-growth economy with somewhat
diminished distressed home sales competition, less competitive
rental-cost alternatives, and new and existing home inventories at
historically low levels, total housing starts should improve
27.6%, while new home sales increase 19.9% and existing home sales
grow 9%. For 2013, total housing starts should increase 16.7%,
while new home sales advance 22% and existing home sales improve
roughly 7%.
Future ratings and Outlooks will be influenced by broad housing
market trends as well as company specific activity, such as trends
in land and development spending, general inventory levels,
speculative inventory activity (including the impact of high
cancellation rates on such activity), gross and net new order
activity, debt levels, cash position and especially free cash flow
trends and uses.
The company's ratings could be upgraded to 'B+' if the company
performs in line with Fitch's 2013 expectations, including revenue
growth of about 35%, EBITDA margins of between 15%-16%, debt to
EBITDA of around 6x and interest coverage in excess of 2x.
Negative rating actions could occur if the recovery in housing
dissipates, resulting in revenues approaching 2011 levels, EBITDA
margins of roughly 10%, interest coverage falling below 1x and
liquidity declining below $200 million.
Fitch has upgraded the following ratings for SPF with a Positive
Outlook:
-- IDR to 'B' from 'B-';
-- Senior unsecured notes to 'B/RR4' from 'B-/RR4';
-- Unsecured Revolving Credit Facility to 'B/RR4' from 'B-/RR4'.
The 'RR4' Recovery Rating (RR) on the company's unsecured debt
indicates average recovery prospects for holders of these debt
issues. Standard Pacific's exposure to claims made pursuant to
performance bonds and joint venture debt and the possibility that
part of these contingent liabilities would have a claim against
the company's assets were considered in determining the recovery
for the unsecured debt holders. The Fitch applied a liquidation
value analysis for these RRs.
STOCKTON PUBLIC: Fitch Keeps 'BB' Ratings on Watch Negative
------------------------------------------------------------
Fitch Ratings maintains the Rating Watch Negative on Stockton
Public Finance Authority, California's (the authority) 'BB+'
underlying ratings.
SECURITY
The 2005 series A and series 2010A bonds are payable from
installment payments made by the city of Stockton, California (the
city) to the authority, with such installment payments secured by
a senior lien pledge of net revenues of the city's water system
(the system). The series 2009A and 2009B bonds are subordinate
lien bonds and are secured by net system revenues after payment of
senior lien obligations. The authority has assigned its rights to
receive installment payments from the city to the trustee for the
benefit of bondholders.
KEY RATING DRIVERS
NEGATIVE WATCH MAINTAINED: With the city's petition for Chapter 9
bankruptcy protection on June 28, Fitch remains concerned about
potential event risks that may arise and could negatively impact
the financial health of the system or the ability of the system to
make full and timely payment to bondholders. These event risks
continue to include, but are not limited to, the treatment of
pledged revenues during bankruptcy proceedings and declaration by
creditors of an event of default under the financing agreements.
CITY ACTIONS IMPAIR SYSTEM CREDIT QUALITY: The city's actions in
recent months, culminating with the bankruptcy filing in June,
call into question the city's ultimate willingness to pay debt
service on system obligations. While the system currently remains
solvent and appears capable of meeting near-term obligations,
various events of default have been triggered under the system's
financing agreements, having exposed the system to possible bond
acceleration.
ADEQUATE OPERATIONS: System financial performance historically has
been sound and the system's current financial position appears
adequate.
ELEVATED LEVERAGE: The system maintains a high debt burden coupled
with an extended amortization schedule.
DEPRESSED SERVICE AREA: The service area has been significantly
affected by weak economic and housing conditions.
WHAT COULD TRIGGER A DOWNGRADE
DEVELOPMENTS AFFECTING THE SYSTEM: Fitch's ongoing review will
consider both future actions by the city that could negatively
affect the system as well as any developing external system
pressures, including bankruptcy court rulings adversely affecting
system bondholders as well as higher reset rates and bank bonds
associated with the 2010A bonds. Depending on the nature of the
event(s), the ratings on the system bonds could deteriorate
rapidly and significantly from the current rating level.
CREDIT PROFILE
NEGATIVE WATCH REFLECTS ONGOING RISKS
The Negative Watch primarily reflects Fitch's ongoing concerns
regarding possible conditions both within and outside of the city
government that may affect system operating results. These risks
include, but are not limited to, treatment under the bankruptcy
code of pledged revenues and allowable system operating and
maintenance expenses related to the authority's debt as well as
elevated reset rates and potential bank bonds associated with the
2010A bonds. Evidence or expectation of deteriorating system
performance or increased system exposure to various risks would
likely lead to deterioration of system credit quality, and such
downward rating action(s) may be acute and rapid.
CITY GENERAL FUND DRIVES BANKRUPTCY
The city's general fund operations have faced severe financial
weakness in recent years as a result of escalating budgetary costs
coupled with deteriorating revenues stemming from a significant
economic downturn within the city. As a result, the city
initiated a neutral evaluation process with creditors in February
for the purpose of obtaining concessions that would allow the city
to balance its fiscal 2013 budget.
The confidential mediation process concluded on June 25, 2012 as
scheduled, without providing sufficient cost reductions to balance
the city's fiscal 2013 budget. As a result, the city council
passed various resolutions at its June 26, 2012 meeting which
included the adoption of a pendency plan (the plan), and on June
28, 2012, the city formally filed for Chapter 9 bankruptcy
protection.
The plan provides a balanced general fund budget for fiscal 2013,
eliminating a $26 million gap through cost reductions to labor,
retirees, debt and other obligations. The plan will serve as the
city's fiscal 2013 budget while the city is under Chapter 9
bankruptcy protection.
WATER SYSTEM REMAINS SOLVENT
Despite the city's general fund fiscal problems, the system
continues to perform largely as expected relative to projections
at the time of the issuance of the 2010A bonds. This performance,
and Fitch's expectation of the protection of pledged revenues for
system bondholders under bankruptcy proceedings which would allow
continued performance on system obligations have limited
deterioration in system credit quality to date. Nevertheless, the
city's actions cannot be completely separated from the system's
credit as they have exposed the system to bond acceleration risk
and other potential risks. Consequently, the city's actions have
had and will continue to have some direct bearing on the system's
credit quality.
For fiscal 2011 total debt service coverage (DSC) on system bonds
equaled 1.15x, with the federal interest rate subsidy related to
the series 2009B Build America Bonds (BABs) treated as revenue as
opposed to an offset to debt service. For the same period, the
system maintained strong liquidity at 779 days cash while surplus
net revenues covered depreciation expenses by a reasonable 89%.
For fiscal 2012, revenues and expenses reportedly tracked close to
budgeted figures. Consequently, based on budgeted net income,
estimated debt service for the year, and treating the BABs subsidy
as revenues, total DSC is expected at around 1.4x for the year.
Unaudited cash balances are little changed from fiscal 2011. The
city reports that the system maintained around $36 million in
unrestricted cash as well as slightly more than $8 million in the
system rate stabilization fund (RSF).
For fiscal 2013, financial results are also forecasted to remain
relatively favorable based on the plan adopted by the city council
which includes implementation of a 10% rate increase -- the final
year of a package that was approved by the city council in 2009.
Total DSC is projected at just under 1.2x, assuming weekly resets
of the 2010A bonds at significantly higher amounts than
historically achieved as well as treatment of the BABs subsidy as
revenues; to date resets have been below budgeted amounts.
In determining fiscal 2013 net revenues, Fitch has assumed a net
$1.5 million reduction in operating costs based on a budget
amendment approved by the city council on Sept. 11, 2012. Also,
Fitch has assumed in its calculation a net increase in revenues of
$3.6 million based on the same budget amendment. Of the increase
in revenues, just over $3 million is attributable to transfers in
from the RSF to meet the rate covenant.
ELEVATED DEBT PROFILE
The system's debt profile is weak as a result of historical growth
projects as well as because of Delta Water Supply Project (DWSP)
costs. Construction related to the DWSP has been completed and was
reportedly on budget. The project is operational and currently is
in the testing phase, with no issues being reported.
Overall, debt per customer and debt per capita are around 3x the
national median. While improvement in the system's capital
structure is expected over time, debt levels will continue to be a
long-term concern as only 46% of principal amortizes within 20
years.
Fitch maintains the following authority ratings on Rating Watch
Negative:
-- $55 million variable rate demand water revenue bonds, series
2010A (Delta Water Supply Project) 'BB+';
-- $24.2 million 2005 water revenue bonds, series A (Water
System Capital Improvement Projects) 'BB+';
-- $18.6 million water revenue bonds, series 2009A (Delta Water
Supply Project) 'BB+';
-- $154.6 million water revenue bonds, series 2009B (taxable
Build America Bonds) (Delta Water Supply Project) 'BB+'.
SUGAR CREEK, MO: Moody's Lifts Revenue Bond Rating From Ba1
-----------------------------------------------------------
Moody's Investors Service has upgraded the rating on
USD47 million of Industrial revenue bond issued by the City of
Sugar Creek and guaranteed by Lafarge North America to A3 from
Ba1. All ratings of Lafarge SA and its subsidiaries remain
unchanged at Ba1.
Ratings Rationale
The upgrade was prompted by the execution of a defeasance
agreement pursuant to the closing of the sale of some Lafarge
assets to Eagle Materials on 30th November 2012. The USD47 million
Industrial revenue bonds were issued in 2003 by the City of Sugar
Creek and were guaranteed by Lafarge North America, a fully owned
subsidiary of Lafarge SA.
Lafarge North America and a subsidiary of Eagle Materials have
signed a defeasance agreement on November 30, 2012. Sufficient
funds in cash have been deposited with the trustee (UMB Bank) to
provide for the defeasance of the bonds in accordance with Section
1101 of the bond indenture. The bonds will redeemed on June 1,
2013 at the redemption price of 101 plus accrued interest. The
trustee holds cash that has been certified to provide sufficient
moneys to pay the redemption price of the bonds on the redemption
date and has released and discharged Sugar Creek's and Lafarge
North America's obligations under the indenture. These bonds are
now rated four notches above Lafarge North America's senior
unsecured debt. Moody's believes that the defeasance transaction
and documentation does not provide sufficient assurances to rate
the bonds more highly.
City of Sugar Creek'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 City of Sugar Creek's core
industry and believes City of Sugar Creek's ratings are comparable
to those of other issuers with similar credit risk.
TALON THERAPEUTICS: To Issue Add'l 400,000 Shares Under Plan
------------------------------------------------------------
Talon Therapeutics, Inc., filed a Form S-8 with the U.S.
Securities and Exchange Commission registering 400,000 shares of
common stock issuable under the Company's 2006 Employee Stock
Purchase Plan thus increasing the total number of shares
registered for issuance under the Plan from 337,500 to 737,500.
The proposed maximum aggregate offering price of the offering is
$204,000.
About Talon Therapeutics
Formerly known as Hana Biosciences, Inc., Talon Therapeutics Inc.
(TLON.OB.) -- http://www.talontx.com/-- is a biopharmaceutical
company dedicated to developing and commercializing new,
differentiated cancer therapies designed to improve and enable
current standards of care. The company's lead product candidate,
Marqibo, potentially treats acute lymphoblastic leukemia and
lymphomas. The Company has additional pipeline opportunities some
of which, like Marqibo, improve delivery and enhance the
therapeutic benefits of well characterized, proven chemotherapies
and enable high potency dosing without increased toxicity.
Effective Dec. 1, 2010, Hana Biosciences changed its name to Talon
Therapeutics. The name change was effected by merging Talon
Therapeutics, a wholly owned subsidiary of the Company, with and
into the Company, with the Company as the surviving corporation in
the merger.
The Company's balance sheet at June 30, 2012, showed $18.38
million in total assets, $10.89 million in total liabilities,
$22.22 million in series B convertible preferred stock, and $14.73
million in total stockholders' equity.
The Company reported a net loss of $18.82 million for the year
ended Dec. 31, 2011, compared with a net loss of $25.98 million
during the prior year.
BDO USA, LLP, in San Jose, California, issued a "going concern"
qualification on the financial statements for the year ended
Dec. 31, 2011, citing recurring losses from operations and net
capital deficiency that raise substantial doubt about the
Company's ability to continue as a going concern.
TEMPEL STEEL: Moody's Cuts CFR/PDR to 'Caa1'; Outlook Negative
--------------------------------------------------------------
Moody's has downgraded Tempel Steel Company's Corporate Family and
Probability of Default Ratings to Caa1 from B3. The company's
senior secured notes due 2016 have also been downgraded to Caa1
from B3. The downgrade takes into consideration the company's weak
performance, increasing leverage and the expectation for ongoing
weakness. The company's rating outlook has been changed to
negative from stable.
Downgrades:
Issuer: Tempel Steel Company
Probability of Default Rating, Downgraded to Caa1 from B3
Corporate Family Rating, Downgraded to Caa1 from B3
Senior Secured Notes, Downgraded to Caa1, LGD4, 50% from B3,
LGD3, 49%
Outlook Actions:
Issuer: Tempel Steel Company
Outlook, Changed To Negative From Stable
Ratings Rationale
Tempel Steel's Caa1 rating reflects its weak business environment,
declining revenues, weak interest coverage, high leverage and
negative free cash flow. Interest coverage has declined while at
the same time leverage has increased from already high levels. For
the LTM period ended September 30, 2012, the company had negative
free cash flow and a minimal cash balance at the end of the
quarter. Although Tempel Steel sells its products into a variety
of end markets, Moody's believes that its weak performance is
partially due to its product concentration within a challenging
market, deriving the vast majority of its revenues from the sale
of magnetic steel laminations. Magnetic steel laminations are
precision stamped sheets of steel that are layered together to
form the core of electric motors and transformers.
Moody's expects that the company's metrics will remain weak into
2013 as performance continues to face challenges. The company has
significant interest expense related in large part to the interest
burden on its $135 million outstanding issue of 12% senior secured
notes due 2016. The company's $35 million ABL revolving credit
facility, which it is expected to need at various points
throughout the year, contains two minimum fixed charge coverage
ratios, one calculated for the borrowers on a standalone basis and
one for the borrowers on a consolidated basis including its
subsidiaries. The negative outlook reflects the challenges for the
company to improve its performance in the current tough
environment. Further, the outlook reflects a weak liquidity
position with the potential to deteriorate further.
What Could Change The Ratings - Down
The company's ratings could be pressured if debt to EBITDA
continues to exceed 7.0 times and if EBITDA to interest expense
remains under 1.25 times, both on a sustained basis. Funds from
operations to debt sustained below 5% and continuing negative free
cash flow could also pressure ratings. The company's ratings could
also be adversely impacted if the company's liquidity position
deteriorates, if it has difficulty meeting its covenants or if it
does not maintain access to its revolving credit facility.
What Could Change The Ratings - Up
The company's ratings could experience positive traction if debt
to EBITDA were below 5.5 times and EBITDA to interest expense
above 2.0 times, both on a sustained basis. Ratings could also get
positive traction if the company improves revenues and margins
while generating positive free cash flow, all on a sustained
basis. Demonstrating a sustainable turnaround in these performance
metrics in conjunction with deleveraging, improved interest
coverage and a better liquidity position could contribute to a
move in the rating outlook to stable.
The principal methodology used in rating Tempel Steel 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.
Tempel Steel, a privately-owned company headquartered in Chicago,
is engaged primarily in the manufacture of magnetic steel
laminations which are used in electrical motors and transformers.
The company has manufacturing facilities located in the United
States, Mexico, India and China.
THQ INC: Wins Approval for KCC as Claims and Notice Agent
---------------------------------------------------------
THQ Inc. and its affiliated debtors obtained bankruptcy court
approval to appoint Kurtzman Carson Consultants LLC as claims and
notice agent.
Prepetition, the Debtors provided KCC a $25,000 retainer.
KCC will bill the Debtors at a 30% discounted rate for its
consulting services:
Discounted
Position Hourly Rate
-------- -----------
Clerical $28 to $42
Project Specialist $56 to $98
Technology/Programming Consultant $70 to $140
Consultant $87.5 to $140
Senior Consultant $157.5 to $192.5
Senior Managing Consultant $295
As for the noticing services, the firm will charge $0.10 per page
for domestic facsimile, and $50 per 1,000 e-mails for electronic
noticing, and $0.10 per notice for claim acknowledgement cards.
For the claims administration and management, KCC will waive the
fee for a case-specific public website hosting but will charge
$0.10 per creditor per month for license fee and data storage.
For its call center support services, KCC will charge $0.34 per
minute for its interactive voice response (IVR).
The claims agent can be reached at:
Drake D. Foster
KURTZMAN CARSON CONSULTANTS LLC
2335 Alaska Ave.
El Segundo, CA 90245
Tel: (310) 823-9000
Fax: (310) 823-9133
About THQ
THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide
developer and publisher of interactive entertainment software.
The Company develops its products for all popular game systems,
personal computers, wireless devices and the Internet.
Headquartered in Los Angeles County, California, THQ sells product
through its network of offices located throughout North America
and Europe.
THQ Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 12-13398) on Dec. 19, 2012.
THQ has a deal to sell its video-game development business to
Clearlake Capital Group LP for about $60 million, absent higher
and better offers at an auction proposed for January 2013.
Clearlake and existing lender Wells Fargo Capital Finance LLC are
providing $10 million of DIP financing.
Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn
& Crutcher LLP serve as counsel to the Debtors. FTI Consulting
and Centerview Partners LLC are the financial advisors. Kurtzman
Carson Consultants is the claims and notice agent.
THQ INC: Proposes $427,000 Non-Insider Key Employee Retention Plan
------------------------------------------------------------------
THQ Inc. and its affiliates seek the Bankruptcy Court's approval
of a non-insider key employee retention plan.
The Debtors are selling their assets by Jan. 15, 2013, to
Clearlake Capital Group, L.P., or to the winner at the auction.
Recognizing the impact if certain members of the development teams
and certain personnel at the corporate headquarters were to resign
prior to the closing of the sale, the Debtors determined that a
retention program was in the best interest of the Debtors'
estates.
The Debtors would make available $427,000 for bonus payments to
key employees, provided, however, each key employee would only
receive a bonus payment under the KERP if he/she continues working
through the close of the sale. Clearlake has agreed that if it is
the successful purchaser of the assets, it will assume and honor
the Debtors' obligations under the KERP.
No member of THQI's management team or the board is eligible to
receive any payment under the KERP.
About THQ
THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide
developer and publisher of interactive entertainment software.
The Company develops its products for all popular game systems,
personal computers, wireless devices and the Internet.
Headquartered in Los Angeles County, California, THQ sells product
through its network of offices located throughout North America
and Europe.
THQ Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 12-13398) on Dec. 19, 2012.
THQ has a deal to sell its video-game development business to
Clearlake Capital Group LP for about $60 million, absent higher
and better offers at an auction proposed for January 2013.
Clearlake and existing lender Wells Fargo Capital Finance LLC are
providing $10 million of DIP financing.
Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn
& Crutcher LLP serve as counsel to the Debtors. FTI Consulting
and Centerview Partners LLC are the financial advisors. Kurtzman
Carson Consultants is the claims and notice agent.
THQ INC: Wins Approval to Pay Critical Vendors
----------------------------------------------
THQ Inc. and its affiliates filed a motion to pay prepetition
claims of so-called critical vendors and service providers. The
Debtors estimate that between the Petition Date and Jan. 14, 2013,
the outstanding amounts that will become due to critical vendors
will total $6 million. The Debtors will only critical vendors who
agree to continue to supply goods or services on customary trade
terms postpetition. The Debtors have won approval of the motion
on an interim basis. The Debtors may pay up to $4 million to
critical vendors pending a final hearing on the motion on Jan. 4.
About THQ
THQ Inc. (NASDAQ: THQI) -- http://www.thq.com/-- is a worldwide
developer and publisher of interactive entertainment software.
The Company develops its products for all popular game systems,
personal computers, wireless devices and the Internet.
Headquartered in Los Angeles County, California, THQ sells product
through its network of offices located throughout North America
and Europe.
THQ Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 12-13398) on Dec. 19, 2012.
THQ has a deal to sell its video-game development business to
Clearlake Capital Group LP for about $60 million, absent higher
and better offers at an auction proposed for January 2013.
Clearlake and existing lender Wells Fargo Capital Finance LLC are
providing $10 million of DIP financing.
Attorneys at Young Conaway Stargatt & Taylor, LLP and Gibson, Dunn
& Crutcher LLP serve as counsel to the Debtors. FTI Consulting
and Centerview Partners LLC are the financial advisors. Kurtzman
Carson Consultants is the claims and notice agent.
THQ INC: WWE Responds to Bankruptcy Filing
------------------------------------------
WWE is listed in THQ, Inc.'s recent bankruptcy filing as an
unsecured creditor holding a claim of approximately $45 million
reflecting the entirety of an existing multi-year agreement. WWE
said any impairment of a current THQ account receivable would be
immaterial to WWE's financial statements. Even if the impact of
THQ's bankruptcy were detrimental to WWE, the Company does not
believe that the ultimate economic impact for financial statement
purposes would materially and adversely affect the results of
operations or financial position of WWE in light of the strength
of the WWE brand and the historical performance of WWE's video
game business.
About THQ
Los Angeles, California-based THQ Inc. (NASDAQ: THQI) --
http://www.thq.com/-- is a worldwide developer and publisher of
interactive entertainment software. The Company develops its
products for all popular game systems, personal computers,
wireless devices and the Internet.
THQ Inc. and four affiliates sought Chapter 11 bankruptcy (Bankr.
D. Del. Case Nos. 12-13398 to 12-13402) on Dec. 19, 2012. Hon.
Mary F. Walrath presides over the case. Lawyers at Young Conaway
Stargatt & Taylor, LLP, and Gibson, Dunn & Crutcher LLP, serve as
the Debtors' counsel. FTI Consulting and Centerview Partners LLC
serve as the Debtors' financial advisors. Kurtzman Carson
Consultants serves as claims and noticing agent.
As of Dec. 17, 2012, the Company had consolidated assets of
$204,800,000 and liabilities of $248,100,000. The petitions were
signed by Brian J. Farrell, chief executive officer.
THQ Inc. has a deal to sell its video-game development business to
Clearlake Capital Group LP for about $60 million, absent higher
and better offer for the assets. The bankruptcy judge will
convene a hearing on Jan. 4, 2013 to consider approval of the
proposed bidding and sale procedures. Objections to the auction
schedule and the proposed bid protections for the lead bidder are
due Jan. 2.
Samuel M. Greene, a partner at Centerview Partners, which was
engaged by the Debtors in June to find an investor or a buyer,
said Clearlake's proposal in October was to provide a $70 million
capital investment in the Debtors. But due to a projected
liquidity shortfall in late December, the proposal was converted
from a debt investment into an outright purchase of the Company
for cash consideration that would satisfy the Debtors' secured
debt and administrative/priority claims. Clearlake later improved
its proposal to include a $10 million note payable to the Debtors'
estates.
The bid procedures contemplate that prospective purchasers must
submit bids by Jan. 8, 2013, and that if, a "qualified bid" in
addition to Clearlake's is received, an auction will be conducted
on Jan. 9. Upon the selection of a winning bid, the Debtors will
seek approval for the sale no later than Jan. 10.
Clearlake's offer for the business comprises (a) cash sufficient
to pay secured claims, including the DIP credit facility
(projected balance at $29 million), (b) cash of $6.65 million at
closing, (c) a promissory note in the face amount of $10 million,
which will pay interest only at the rate of 2% per annum.
If Clearlake is not the winning bidder, the Debtors propose to pay
a break-up fee of $1.75 million and expense reimbursement of
$500,000.
Wells Fargo Capital Finance LLC and Clearlake have agreed to
provide the Debtors with postpetition financing consisting of (i)
an asset based revolving credit facility of up to $27.5 million of
revolving loans, and (ii) a term loan facility of $10 million.
The DIP Lenders are represented by Gregg M. Galardi, Esq., at DLA
Piper LLP (US).
TOYS 'R' US: Fitch Lowers Issuer Default Rating to 'B-'
-------------------------------------------------------
Fitch Ratings has downgraded the Issuer Default Ratings (IDR) for
Toys 'R' Us, Inc. (Toys) and its various subsidiary entities to
'B-'. The Rating Outlook is Stable.
The 'B-' IDR reflects Toys' weaker than expected comparable store
sales (comps) performance year-to-date and the overhang of
refinancing 2013 maturities, which Fitch had initially expected
would be completed done by November. Fitch has concerns that the
weak third quarter comps trend could continue in the critical
holiday selling season and into 2013 and place pressure on
margins. More than 40% of Toys' sales and over 70% of its EBITDA
are typically generated in the fourth quarter.
Top Line Deceleration
Toys' top-line sales are under increasing pressure with comps for
the domestic and international segments at negative 2.8% and 4.7%
in the first nine months of 2012, respectively, versus negative
1.7% and 2.7% for the full year 2011. The rate of decline has
accelerated in each of the last three quarters, with comps
declining 4.1% in its domestic business (60% of sales) and 4.6% in
its international business in the third quarter.
Top line weakness is being primarily caused by continued weakness
in the entertainment (approximately 13% of domestic and 12% of
international sales) and juvenile categories (approximately 37% of
domestic and 22% of international sales). Fitch expects the
entertainment category which is going through structural changes
will continue to face headwinds, while the juvenile category is
being hurt by a decline in birth rates over the past few years.
In addition, the overall toys category faces intensified pricing
competition from discount and online retailers.
While Toys is the only remaining national brick-and-mortar
specialty toy retailer in the U.S., it has muddled along against
increasing competition from discounters and online retailers for
the more commodity-type toy products. Toys' multi-channel
strategy, coupled with recently implemented product and service
initiatives including price match guarantee for the holidays,
could potentially alleviate some top-line pressure. However,
Fitch believes that it will be expensive and difficult for Toys to
compete on pricing and retain its market share without sacrificing
margins given its heavy cost structure. As a result, Fitch
expects limited benefit from these initiatives on the company's
top line and profitability in the near term.
Besides the sluggish domestic business, Fitch recognizes the
challenging economic and capital market conditions in the major
European markets (revenues generated between U.K. and Central
Europe accounted for almost 17% of the consolidated revenue in
2011). This creates uncertainties in the refinancing process and
could add pressure to operations going forward.
Leverage Expected To Creep Up
Fitch expects Toys' leverage (adjusted debt/EBITDAR) will remain
in the low-6.0x in 2012 if EBITDA is essentially flat to last
year. This assumes that top line is in the negative 3 - 4% range
for the fourth quarter as well as some modest gross margin
improvement.
However, with a weakening sales outlook and lack of 53rd week
benefit, Fitch' expects that Toys' EBITDA could dip to the low to
mid $800 million range over the next 24 months. As a result,
leverage could potentially creep up to the high-6.0x to the low-
7.0x assuming some debt repayment as Toys completes the European
refinancings. Coverage (operating EBITDAR/gross interest expense
plus rents) is expected to be in the range of 1.3x - 1.4x. This
assumes comps decline at 2%-3% at both the domestic and
international segments and modest gross margin improvement.
Assuming selling, general, and administrative (SG&A) expenses grow
modestly in the flat to 1% range, Fitch expects a negative impact
on the operating margin.
Liquidity Adequate Although FCF Dependent on Working Capital
Improvement
Toys' weak top-line performance has pressured EBITDA and free cash
flow (FCF) generation. FCF over the last two years has also been
adversely affected by the continued challenge of managing working
capital efficiently. Besides some timing related issues, the
company has gotten stuck with excess inventory in the last two
holiday seasons. As a result working capital was a use of cash of
$485 million in 2010 and $273 million in 2011.
Toys has been addressing some of these issues more aggressively
this year and inventory at the end of the third quarter was down
2.1% year over year (versus +5.9% in 3Q'11). Therefore, if
working capital is flat overall this year - a significant
improvement from the last two years - Fitch expects Toys to
generate $200 million - $250 million in FCF in 2012. There could
be some downside to these projections if comps are in the negative
mid-single digit range.
Beyond 2012, Toys would need to be working capital neutral to
enable the company to generate modest FCF of $40 million-$50
million. Fitch estimates that breakeven EBITDA is around $750
million assuming interest expense of $440 million - $450 million
(based on the new capital structure with higher interest rates
offset by some debt paydown), capital expenditures of $300 million
- $325 million and neutral working capital.
Refinancing Update
While successfully refinancing the HoldCo notes due April 2013,
Toys still has $896 million of European real estate facilities due
between February and April 2013. This constitutes: $79 million
French; $163 million Spanish and $654 million UK real estate
credit facilities. Given the tough CMBS markets, Fitch expects
Toys to be able to issue significantly less debt against the same
collateral.
However, Toys has $557 million of liquidity at HoldCo, comprised
of upstreamed dividend from Toys 'R' Us -Delaware (including the
proceeds from the borrowings of a $225 million incremental term
loan) that can be applied towards any unrefinanced balance of the
European real estate facilities. Fitch expects Toys to address
all its refinancing needs by the maturity dates, although it
remains an overhang.
Assuming the successful refinancing of the remaining 2013
maturities, Toys has adequate liquidity with $399 million of cash
and cash equivalents and $1.8 billion of availability under its
various revolvers as of Oct. 27, 2012.
Recovery Analysis and Considerations
The ratings on the specific securities reflect Fitch's recovery
analysis using a going concern approach. This analysis is used to
determine expected recoveries in a distressed scenario to each of
the company's debt issues and loans.
Below is a summary organizational structure (details are provided
at the end of the press release) for the purpose of the recovery
analysis:
Toys 'R' Us, Inc. (HoldCo)
-- (I) Toys 'R' Us-Delaware, Inc. (Toys-Delaware) is a
subsidiary of HoldCo.
-- (a) Toys 'R' Us Canada (Toys-Canada) is a subsidiary of Toys-
Delaware.
-- (b) Toys 'R' Us Property Co. II, LLC is a subsidiary of Toys-
Delaware.
-- (II) Toys 'R' Us Property Co. I, LLC is a subsidiary of
HoldCo.
Consolidated Stressed EBITDA
In estimating Toys' EV for recovery purposes, Fitch has used a
going-concern approach. Toys' debt is at three types of entities:
operating companies (OpCo); property companies (PropCo); and the
holding company (HoldCo), as described below.
OpCo Debt.
At the OpCo levels -- Toys-Delaware, Toys-Canada, and other
international operating companies -- LTM EBITDA (as of Oct. 27,
2012) is stressed at 15%. Fitch has assigned a 5.5x multiple to
the stressed EBITDA, which is consistent with the low end of the
10-year valuation for the public space and Fitch's average
distressed multiple across the retail portfolio. The stressed EV
is adjusted for 10% administrative claims.
Toys-Canada: Toys has a $1.85 billion secured revolving credit
facility with Toys-Delaware as the lead borrower, and this
contains a $200 million sub-facility in favor of Canadian
borrowers. Any assets of the Canadian borrower and its
subsidiaries secure only the Canadian liabilities. The $200
million sub-facility is more than adequately covered by the $472
million in calculated EV based on a stressed EBITDA of $86
million. Therefore, the fully recovered sub-facility is reflected
in the recovery of the consolidated $1.85 billion credit facility
discussed below.
The residual value is applied toward debt at Toys-Delaware.
Toys-Delaware: In allocating $2.1 billion of calculated stressed
EV (which includes the recovery on the Canadian sub-facility,
approximately $238 million in residual value from Canada, and no
residual value from PropCo II) at Toys-Delaware across the various
tranches of debt, Fitch ascribes a higher priority to the senior
secured credit facility, due to its first lien tangible security
package over the term loans and 7.375% senior secured notes.
The $1.85 billion credit facility is secured by a first lien on
inventory and receivables of Toys-Delaware and its domestic
subsidiaries. In allocating an appropriate recovery, Fitch has
considered the liquidation value of domestic inventory and
receivables assumed at seasonal peak (at end of the third
quarter), corresponding to peak borrowings of $1.725 billion
($1.85 billion minus the $125 million in minimum excess
availability).
Fitch assumes peak domestic inventory levels of $2.25 billion and
receivables of $85 million, for recovery purposes and has applied
liquidation values of 70% and 80%, respectively. This liquidation
value of $1.5 billion is applied toward the secured revolver, in
addition to the approximately $200 million recovered on the
Canadian sub-facility. As a result, the facility is fully
recovered and is therefore rated 'BB-/RR1'.
The recovery value of the debt structure below the first lien
revolver comprises two components: (1) excess EV at the Toys-
Delaware level (EV at Toys-Delaware minus liquidation value of
assets) and (2) equity residual value from Canada. The component
(1) is fully applied toward the $1.325 billion loans and $350
million 7.375% senior secured notes, while the component (2) is
applied across the capital structure (excluding the fully
recovered revolver).
This results in recovery prospects of 11% - 30% for the term loans
and the secured notes, which are therefore rated 'CCC+/RR5'. The
term loans due 2016 and 2018, and the senior secured notes due
2016, are secured by a first lien on intellectual property rights
and a second lien on accounts receivable and inventory of Toys-
Delaware and its domestic subsidiaries.
The 8.75% debentures due Sept. 1, 2021, have poor recovery
prospects and are therefore rated 'CCC/RR6'.
PropCo Debt
At the PropCo levels - Toys 'R' Us Property Co. I, LLC; Toys 'R'
Us Property Co. II, LLC; and other international PropCos - LTM NOI
is stressed at 15%. The ratings on the PropCo notes reflect a
distressed capitalization rate of 12% applied to the NOI of the
properties to determine a going-concern valuation. The stressed
rates reflect downtime and capital costs that would need to be
incurred to re-tenant the space.
Applying these assumptions to the $725 million 8.50% senior
secured notes at PropCo II and $950 million 10.75% senior
unsecured notes at PropCo I results in recovery well in excess of
90%. Therefore, these facilities are rated 'BB-/RR1'.
The PropCo I unsecured notes benefit from a negative pledge on 351
properties while the PropCo II notes are secured by 129
properties. PropCo I and PropCo II are set up as bankruptcy-
remote entities with a 20-year master lease covering all the
properties, which requires Toys-Delaware to pay all costs and
expenses related to the ownership.
Toys 'R' Us, Inc. - HoldCo Debt
The $450 million 10.375% unsecured notes due Aug. 15, 2017, and
the $400 million 7.375% unsecured notes due Oct. 15, 2018, benefit
from the residual value at PropCo I. There is no residual value
ascribed from Toys-Delaware or other operating subsidiaries. This
results in average recovery prospects of 31%-50% and the bonds are
therefore rated 'B-/RR4'.
WHAT COULD TRIGGER A RATING ACTION
A negative rating action could result if:
-- If comps trends in the U.S. and international businesses
continue to be in the negative 4% - 5% range, and indicate
market share losses that would cause leverage to increase
meaningfully and/or lead to tightened liquidity over the next
two years, particularly during its peak working capital
season;
-- FCF is significantly weaker than Fitch's expectation, either
due to weakening EBITDA trend or continued lack of efficiency
in managing working capital;
A positive rating action could result if:
-- There is sustainable improvement in the business as a result
of the company's new product and service initiatives which
help drive improved store and online traffic, and curb share
losses. The company would need to improve EBITDA to the $1.1
billion range and leverage to the high 5.0x range.
-- In addition, management will need to prove their ability to
manage working capital effectively over the next two years to
ensure FCF generation.
Fitch has downgraded Toys as follows:
Toys 'R' Us, Inc. (HoldCo)
-- IDR to 'B-' from 'B';
-- Senior Unsecured Notes to 'B-/RR4' from 'B/RR4'.
Toys 'R' Us - Delaware, Inc. is a subsidiary of HoldCo
-- IDR to 'B-' from 'B';
-- Secured Revolver to 'BB-/RR1' from 'BB/RR1';
-- Secured Term Loans to 'CCC+/RR5' from 'B-/RR5';
-- Senior Secured Notes to 'CCC+/RR5' from 'B-/RR5';
-- Senior Unsecured Notes to 'CCC/RR6' from 'CCC+/RR6'.
Toys 'R' Us Property Co. II, LLC is subsidiary of Toys 'R' Us -
Delaware, Inc.
-- IDR to 'B-' from 'B';
-- Senior Secured Notes to 'BB-/RR1' from 'BB/RR1'.
Toys 'R' Us Property Co. I, LLC is a subsidiary of HoldCo
-- IDR to 'B-' from 'B';
-- Senior Unsecured Notes to 'BB-/RR1' from 'BB/RR1'.
The Rating Outlook is Stable.
TPC GROUP: S&P Assigns 'B' Corp. Credit Rating Following LBO
------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' corporate credit
rating to TPC Group Inc. The outlook is stable. "At the same time,
we lowered the ratings on TPC Group LLC, including the corporate
credit rating to 'B' from 'B+', and removed all TPC Group LLC's
ratings from CreditWatch. The ratings on TPC Group LLC have
subsequently been withdrawn," S&P said.
"Earlier this month, we had assigned our 'B' issue-level rating to
TPC Group Inc.'s $655 million senior secured notes, with a
recovery rating of '4', indicating our expectation for an average
(30% to 50%) recovery in the event of a payment default," S&P
said.
"The rating actions follow the announcement that First Reserve and
SK Capital have closed the acquisition of TPC Group Inc., in a
transaction valued at over $900 million," said credit analyst
Danny Krauss.
"The outlook is stable. Although butadiene prices can fluctuate
meaningfully, we expect them to remain high compared to historical
prices because of the shift towards cracking cost advantaged light
feedstocks. A key underpinning at the rating is our expectation
that the company will be able to maintain adequate liquidity,
despite high capital spending requirements over the next two
years. During that time, we expect that the company will maintain
credit metrics at levels we consider appropriate for the current
rating, including debt-to-EBITDA of about 6x and FFO-to-debt of
about 10%," S&P said.
"We could lower the ratings if TPC's liquidity position
deteriorates meaningfully below our expectations, as a result of
higher than expected capital expenditure requirements or a
significant drop in the borrowing base. We could also consider a
modest downgrade if earnings and cash flows decline unexpectedly
because of weaker demand for butadiene. Based on our downside
scenario, this could occur if EBITDA margins decline by 100 basis
points or more from current levels. At this point, we would expect
debt-to-EBITDA to increase to above 7x. The ratings could also
come under pressure if financial policy decisions related to the
company's idle on-purpose butadiene plant or acquisition spending,
resulted in a meaningful increase in debt," S&P said.
"We could consider a one-notch upgrade if operating performance
improves meaningfully, allowing the company to reduce debt-to-
EBITDA to about 5x. To consider a higher rating, we would also
need greater clarity that the company will be able to pursue its
growth initiatives without straining its financial profile," S&P
said.
TRIBUNE CO: Bank Debt Trades at 17% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Tribune Co. is a
borrower traded in the secondary market at 82.93 cents-on-the-
dollar during the week ended Friday, Dec. 21, a drop of 0.43
percentage points from the previous week according to data
compiled by LSTA/Thomson Reuters MTM Pricing and reported in The
Wall Street Journal. The Company pays 300 basis points above
LIBOR to borrow under the facility. The bank loan matures on May
17, 2014. The loan is one of the biggest gainers and losers among
197 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
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)
TRIMJOIST CORP: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Trimjoist Corporation
5146 Highway 182 E
P.O. Box 2286
Columbus, MS 39704
Bankruptcy Case No.: 12-15405
Chapter 11 Petition Date: December 18, 2012
Court: United States Bankruptcy Court
Northern District of Mississippi (Aberdeen)
Judge: David W. Houston III
Debtor's Counsel: Craig M. Geno, Esq.
CRAIG M. GENO, PLLC
P.O. Box 3380
Ridgeland, MS 39158-3380
Tel: (601) 427-0048
E-mail: cmgeno@cmgenolaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/msnb12-15405.pdf
The petition was signed by E. Barry Sanford, president, director.
TXU CORP: Bank Debt Trades at 33% Off in Secondary Market
---------------------------------------------------------
Participations in a syndicated loan under which TXU Corp., now
known as Energy Future Holdings Corp., is a borrower traded in the
secondary market at 67.15 cents-on-the-dollar during the week
ended Friday, Dec. 21, an increase of 1.80 percentage points from
the previous week according to data compiled by LSTA/Thomson
Reuters MTM Pricing and reported in The Wall Street Journal. The
Company pays 450 basis points above LIBOR to borrow under the
facility. The bank loan matures on Oct. 10, 2017, and carries
Moody's Caa1 rating and Standard & Poor's CCC rating. The loan is
one of the biggest gainers and losers among 197 widely quoted
syndicated loans with five or more bids in secondary trading for
the week ended Friday.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
The Company's balance sheet at Dec. 31, 2011, showed $44.07
billion in total assets, $51.83 billion in total liabilities, and
a $7.75 billion total deficit.
Energy Future had a net loss of $1.91 billion on $7.04 billion of
operating revenues for the year ended Dec. 31, 2011, compared with
a net loss of $2.81 billion on $8.23 billion of operating revenues
during the prior year.
* * *
In late January 2012, Moody's Investors Service changed the rating
outlook for Energy Future Holdings Corp. (EFH) and its
subsidiaries to negative from stable. Moody's affirmed EFH's Caa2
Corporate Family Rating (CFR), Caa3 Probability of Default Rating
(PDR), SGL-4 Speculative Grade Liquidity Rating and the Baa1
senior secured rating for Oncor.
EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed
company with limited flexibility. EFH's capital structure is
complex and, in our opinion, untenable which calls into question
the sustainability of the business model and expected duration of
the liquidity reserves.
TXU CORP: Bank Debt Trades at 26% Off in Secondary Market
---------------------------------------------------------
Participations in a syndicated loan under which TXU Corp., now
known as Energy Future Holdings Corp., is a borrower traded in the
secondary market at 74.18 cents-on-the-dollar during the week
ended Friday, Dec. 21, an increase of 3.57 percentage points from
the previous week according to data compiled by LSTA/Thomson
Reuters MTM Pricing and reported in The Wall Street Journal. The
Company pays 350 basis points above LIBOR to borrow under the
facility. The bank loan matures on Oct. 10, 2014, and carries
Standard & Poor's CCC rating. The loan is one of the biggest
gainers and losers among 197 widely quoted syndicated loans with
five or more bids in secondary trading for the week ended Friday.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
The Company's balance sheet at Dec. 31, 2011, showed $44.07
billion in total assets, $51.83 billion in total liabilities, and
a $7.75 billion total deficit.
Energy Future had a net loss of $1.91 billion on $7.04 billion of
operating revenues for the year ended Dec. 31, 2011, compared with
a net loss of $2.81 billion on $8.23 billion of operating revenues
during the prior year.
* * *
In late January 2012, Moody's Investors Service changed the rating
outlook for Energy Future Holdings Corp. and its subsidiaries to
negative from stable. Moody's affirmed EFH's Caa2 Corporate
Family Rating (CFR), Caa3 Probability of Default Rating (PDR),
SGL-4 Speculative Grade Liquidity Rating and the Baa1 senior
secured rating for Oncor.
EFH's Caa2 CFR and Caa3 PDR reflect a financially distressed
company with limited flexibility. EFH's capital structure is
complex and, in our opinion, untenable which calls into question
the sustainability of the business model and expected duration of
the liquidity reserves.
UNITED DISTRIBUTION: S&P Assigns 'B-' Corp. Credit Rating
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' corporate
credit rating to Bristol, Tenn.-based United Distribution Group
Inc. The outlook is stable.
"At the same time, we assigned a 'B-' (the same as the corporate
credit rating) issue-level rating to UDG's $290 million first-lien
credit facilities, consisting of a $40 million revolving credit
facility and a $250 million senior secured first-lien term loan.
The recovery rating on the credit facilities is '3', indicating
our expectation for meaningful (50% to 70%) recovery in the event
of payment default. We also assigned a 'CCC' (two notches lower
than the corporate credit rating) issue-level rating to UDG's
$135 million second-lien term loan. The recovery rating on the
term loan is '6', indicating our expectation for negligible (0% to
10%) recovery in the event of payment default," S&P said.
"The company used proceeds from the credit facilities to acquire
GHX Holdings LLC and refinance existing debt. Prior to the
transaction's closing, UDG was known as ASP United Holding Co. The
borrowers on the credit facilities are United Central Industrial
Supply LLC (United Central) and GHX Holdings LLC (GHX), which are
two subsidiaries of UDG," S&P said.
"The 'B-' corporate credit rating on UDG reflects our view of the
company's 'vulnerable' business risk profile and its 'highly
leveraged' financial risk profile," said Standard & Poor's credit
analyst Megan Johnston. "We believe key business risks include the
company's relatively modest size; a dependence on the cyclical
mining and energy end markets for a large portion of its revenues
and earnings; and risks the mining supply company faces
integrating GHX. In October 2012 UDG acquired GHX, a fluid
transfer and sealed products distributor to companies
participating in energy end markets, for $240 million, or 8x
trailing-12-month EBITDA. We consider UDG's financial risk profile
to be highly leveraged, based on our expectation that the company
will maintain leverage between 5x and 6x in 2012 and 2013."
"The rating outlook is stable, reflecting our belief that UDG's
credit measures will remain in line with the 'B-' corporate credit
rating, given our expectation that GHX's energy end markets will
partly offset weakness in United Central's coal mining end
markets. We expect the company to maintain leverage between 5x and
6x over the next several quarters. Our ratings incorporate the
expectation that operating cash flow will remain adequate to
finance internal working capital needs and capital expenditures,"
S&P said.
"We could lower the ratings if the company's liquidity position
deteriorates such that we deem it to be 'less than adequate'. This
could occur if market deterioration, particularly in UDG's key
coal mining end market, leads to lower-than-expected EBITDA or
higher-than-expected borrowings on the company's revolving credit
facility, which could result in reduced headroom on the company's
covenant," S&P said.
"We view an upgrade as unlikely over the near term; however, we
would consider raising the ratings if leverage fell to below 5x
and the company's liquidity position strengthened. Specifically,
we would consider an upgrade if revenues increased in the double
digits and if gross margins improve by about 200 basis points,"
S&P said.
US AIRWAYS: S&P Revises Outlook on 'B-' CCR on Financial Profile
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings, including
its 'B-' corporate credit rating, on Tempe, Ariz.-based airline US
Airways Group Inc. "At the same time, we revised our outlook on
the rating to positive from stable. We also raised or lowered our
issue ratings on selected enhanced equipment trust certificates
(EETCs), based on our assessment of changes in collateral
coverage," S&P said.
"The outlook revision on US Airways is based on the company's
improved financial profile over the past year because of stronger
operating performance, which we expect to continue, assuming fuel
prices remain relatively stable and the economy grows modestly,"
said Standard & Poor's credit analyst Betsy Snyder. "The company
earned $600 million in the first nine months of 2012, compared
with $53 million in the prior year period. Revenues rose by $653
million, due to both traffic and yield (pricing) growth, while
fuel expense rose by a modest $72 million. As a result, credit
metrics improved: EBITDA interest coverage was 2.1x for the 12
months ended Sept. 30, 2012, compared with 1.5x a year earlier;
funds from operations (FFO) to debt was 19%, compared with 10%;
and debt to EBITDA was 5.8x, compared with 7.7x. We expect
earnings and credit measures to continue to improve in 2013
despite anticipated slowing revenue gains. However, credit
measures could deteriorate if a weaker-than-expected economic
recovery causes traffic to soften or oil prices to spike. While
improved, these credit measures continue to be consistent with a
'highly leveraged' financial profile, as defined in our criteria."
"The ratings on US Airways Group reflect its substantial debt and
lease burden and participation in the high-risk U.S. airline
industry. The ratings also incorporate the company's relatively
low operating costs, compared with other 'legacy' airlines. US
Airways is the fifth-largest U.S. airline, carrying about 9% of
industry traffic. Standard & Poor's characterizes the company's
business profile as 'weak,' its financial profile as 'highly
leveraged,' and its liquidity as 'adequate' under our criteria. We
have revised our assessment of the company's business risk profile
to 'weak' from 'vulnerable' based on its improved operating
profitability," S&P said.
"US Airways has indicated its desire to merge with AMR Corp. (D/--
/--) (parent of American Airlines Inc. [D/--/--]), which has been
operating under Chapter 11 bankruptcy protection since Nov. 29,
2011. In September 2012, US Airways signed a nondisclosure
agreement with AMR, following the agreements it signed with three
of American's major unions in April 2012. The agreements with
American's unions set terms that would govern collective
bargaining agreements should both airlines merge. Any merger
agreement would also need approval by management, the board, and
AMR's creditors, some of which have indicated their desire to see
the airlines merge. We will monitor the situation and take any
necessary rating actions if a merger becomes more likely or more
imminent," S&P said.
"Our rating changes on selected EETCs are based on trends in
collateral value that are outside of our previous expectations for
the expected issues. The upgrades were all on older EETCs that
have paid down debt more rapidly than the collateral aircraft
value declined. The downgrades were also all on older EETCs that
have amortized less rapidly than the collateral aircraft value
declined," S&P said.
"The outlook is positive. We expect US Airways' financial profile
to remain fairly consistent in 2013, with EBITDA interest coverage
about 2x and FFO to debt in the mid to high teens. We could raise
ratings if FFO to debt remained in the high-teens percent area,
liquidity remained at least $2.5 billion, and the company
refinanced its term loan that matures in March 2014 early in 2013.
We could revise the outlook to stable if a stalled U.S. economic
recovery or serious oil price spike caused losses, eroding
liquidity to less than 10% of revenues. We will also monitor a
potential merger with AMR," S&P said.
USI INC: S&P Gives 'B-' Counterparty Credit Rating
--------------------------------------------------
Standard & Poor's Ratings Services corrected its rating on USI
Inc. (to be renamed from Compass Investors Inc. following the
completion of its new debt issuance transaction) by assigning it a
'B-' long-term counterparty credit rating. "We also revised the
'B-' issue-level rating and '3' recovery rating on the company's
proposed senior secured facility and our 'CCC' issue-level rating
and '6' recovery rating on its proposed senior unsecured facility
to preliminary ratings. The outlook is stable," S&P said.
"On Dec. 4, 2012, we affirmed in error the rating on USI Inc.
which at that time was unrated. Our rating affirmation should have
been on USI Holdings Corp. We also incorrectly assigned final
issue ratings and recovery ratings on USI Inc.'s new debt
facilities, when they should have been assigned as preliminary
(pending the transaction's closing). In accordance with our
criteria, the ratings and outlook on USI Inc. are equivalent to
the ratings and outlook assigned to USI Holdings Corp.
Accordingly, we have assigned our 'B-' rating and stable outlook
to USI Inc.," S&P said.
"USI Inc. will be the issuer of all new debt facilities. USI
Holdings Corp., a wholly owned subsidiary of USI Inc. (and
guarantor of all its proposed new debt facilities), is the issuer
of the existing debt facilities, which we expect it to retire by
the end of December at the close of the transaction," S&P said.
VELATEL GLOBAL: Secures $12 Million Funding From Ironridge
----------------------------------------------------------
VelaTel Global Communications, formerly known as China Tel Group
Inc., has closed a $12 million stock purchase agreement with
Ironridge Technology Co., an institutional investor in the
telecommunications sector.
Proceeds will be used to fund VelaTel's acquisition of China
Motion Telecom (HK) Limited.
Ironridge is initiating payment of $600,000 for the initial 10%
down payment called for under VelaTel's agreement to acquire 100%
of the equity interest of China Motion. VelaTel projects that the
remaining proceeds of Ironridge's equity funding will be
sufficient for VelaTel to:
* pay the remaining balance to acquire China Motion.
* complete deployment and launch of VelaTel's wireless
broadband networks in Croatia and Montenegro.
* other strategic purposes on projects under development.
The acquisition of China Motion furthers several of VelaTel's long
term strategic goals:
* China Motion's access to wholesale voice and data services
using the wireless network resources of incumbent carriers
allows VelaTel to deploy its projects in mainland China at a
fraction of the capital expenditures originally budgeted.
* China Motion's experience and personnel in sales and
marketing, customer service and billing solutions provides a
platform to serve VelaTel's wireless broadband networks
worldwide.
* The acquisition creates tremendous synergies with VelaTel's
Europe based subsidiary Zapna, which also focusses on long
distance and roaming solutions that cater particularly to the
frequent international traveler.
"I am very impressed with the operational experience of China
Motion," commented Ironridge managing director John Kirkland. "We
are grateful for the opportunity to facilitate VelaTel's
acquisition of the leading mobile virtual network operator in Hong
Kong, and the synergies it can create for VelaTel in mainland
China, South America and Europe."
Under the Ironridge funding contract, VelaTel will sell Ironridge
preferred shares valued at $10,000 per share, which are
convertible into VelaTel's publicly traded Series A Common Stock
at a fixed conversion price of $0.20 per share. Funding is
subject to customary equity conditions and Ironridge is entitled
to non-cumulative dividends and an embedded derivative liability
upon early redemption or conversion as defined in the contract.
VelaTel also agreed to file a customary registration statement to
allow resale of the shares upon conversion.
"We are very grateful to Ironridge for the continued support they
have shown VelaTel," stated VelaTel's President Colin Tay.
"Ironridge recently completed payment of more than $1.3 million to
our most important vendors under their liability for equity (LIFE)
program. They have now broadened their support by not only
increasing the size of their investment, but structuring it in a
manner that allows us flexibility to use the proceeds wherever
they are needed most. We also appreciate the efforts of Mr. Luo
Hongye, our lead partner in China as CEO of our VN Tech division
and a co-founder of ZTE Corporation. Mr. Luo, as a leader in the
telecom and green energy fields in China, was instrumental in
bringing VelaTel and Ironridge together in this transaction."
Additional information about the transaction is available at:
http://is.gd/b5aBpk
About China Tel
Based in San Diego, California, and Shenzhen, China, China Tel
Group, Inc. (OTC BB: CHTL) -- http://www.ChinaTelGroup.com/--
provides high speed wireless broadband and telecommunications
infrastructure engineering and construction services. Through its
controlled subsidiaries, the Company provides fixed telephony,
conventional long distance, high-speed wireless broadband and
telecommunications infrastructure engineering and construction
services. ChinaTel is building, operating and deploying networks
in Asia and South America: a 3.5GHz wireless broadband system in
29 cities across the People's Republic of China with and for CECT-
Chinacomm Communications Co., Ltd., a PRC company that holds a
license to build the high speed wireless broadband system; and a
2.5GHz wireless broadband system in cities across Peru with and
for Perusat, S.A., a Peruvian company that holds a license to
build high speed wireless broadband systems.
After auditing the 2011 results, Kabani & Company, Inc., in Los
Angeles, California, expressed substantial doubt as to the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has incurred a net loss for the
year ended Dec. 31, 2011, cumulative losses of $254 million since
inception, a negative working capital of $16.4 million and a
stockholders' deficiency of $9.93 million.
The Company reported a net loss of $21.79 million in 2011,
compared with a net loss of $66.62 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $21.55
million in total assets, $26.54 million in total liabilities and a
$4.99 million total stockholders' deficiency.
VERTIS HOLDINGS: Jan. 30 Fixed as General Claims Bar Date
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
established Jan. 30, 2013, at 5 p.m. (Pacific Standard Time) as
the deadline for any individual or entity to file proofs of claim
against Vertis Holdings, Inc., et al.
The Court set April 8 as governmental unit claims bar date.
Original proofs of claim must be delivered to:
Vertis Claims Processing Center
c/o Kurtzman Carson Consultants LLC
2335 Alaska Avenue
El Segundo, CA 90245
Proofs of claim sent by facsimile, telecopy, or electromic mail
will not be accepted, according to documents filed in Court.
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.
VHGI HOLDINGS: Incurs $1.3 Million Net Loss in Third Quarter
------------------------------------------------------------
VHGI Holdings, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $1.34 million on $122,918 of total revenue for the three months
ended Sept. 30, 2012, compared with a net loss of $650,836 on
$170,604 of total revenue for the same period during the prior
year.
For the nine months ended Sept. 30, 2012, the Company reported a
net loss of $11.87 million on $370,368 of total revenue, compared
with a net loss of $1.06 million on $471,296 of total revenue for
the same period a year ago.
The Company's balance sheet at Sept. 30, 2012, showed $49.07
million in total assets, $54.61 million in total liabilities and a
$5.53 million total stockholders' deficit.
"The Company has current liabilities in excess of current assets
and has incurred losses since inception. The Company has had
limited operations and has not been able to develop an ongoing,
reliable source of revenue to fund its existence. The Company's
day-to-day expenses have been covered by proceeds obtained, and
services paid by, the issuance of stock and notes payable. The
adverse effect on the Company's results of operations due to its
lack of capital resources can be expected to continue until such
time as the Company is able to generate additional capital from
other sources. These conditions raise substantial doubt about the
Company's ability to continue as a going concern."
A copy of the Form 10-Q is available for free at:
http://is.gd/ktQl5c
About VHGI Holdings
Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company
with revenue streams from these business segments: (a) precious
metals (b) oil and gas (c) coal and (d) medical technology.
In a report on the Company's consolidated financial statements for
the year ended Dec. 31, 2011, Pritchett, Siler & Hardy, P.C., in
Salt Lake City, Utah, expressed substantial doubt about VHGI
Holdings' ability to continue as a going concern. The independent
auditors noted that the Company has incurred substantial losses
and has a working capital deficit.
The Company reported a net loss of $5.43 million in 2011, compared
with a net loss of $1.67 million in 2010.
VISCOUNT SYSTEMS: Bhatia Family Discloses 8.4% Equity Stake
-----------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Bhatia Family Trust disclosed that, as of Nov. 26,
2012, it beneficially owns 7,500,000 shares of common stock of
Viscount Systems, Inc., representing 8.4% of the shares
outstanding. A copy of the filing is available for free at:
http://is.gd/QKOrHq
About Viscount Systems
Burnaby, Canada-based Viscount Systems, Inc., is a manufacturer,
developer and service provider of access control security
products. The Company reported a net loss of C$2.9 million in
2011, compared with a net loss of C$1.3 million in 2010. The
Company's balance sheet at Sept. 30, 2012, showed C$1.08 million
in total assets, C$3.44 million in total liabilities and a C$2.35
million total stockholders' deficit.
"The Company's bank credit facility was suspended on December 30,
2011 due to the bank's assessment of the Company's financial
position. Management has determined that the Company will need to
raise a minimum of $500,000 by way of new debt or equity financing
to continue normal operations for the next twelve months.
Management has been actively seeking new investors and developing
customer relationships, however a financing arrangement has not
yet completed. Short-term loan financing is anticipated from
related parties, however there is no certainty that loans will be
available when required. These factors raise substantial doubt
about the ability of the Company to continue operations as a going
concern."
Following the 2011 results, Dale Matheson Carr-Hilton Labonte LLP,
in Vancouver, Canada, expressed substantial doubt about Viscount
Systems' ability to continue as a going concern. The independent
auditors noted that the Company has an accumulated deficit of
C$5,769,027 and has reported a loss of C$2,883,304 for the year
ended Dec. 31, 2011.
VISCOUNT SYSTEMS: Tamino Capital Discloses 8.4% Equity Stake
------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Spabra, Ltd, and Tamino Capital, LLC, disclosed that,
as of Nov. 26, 2012, they beneficially own 7,500,000 shares of
common stock of Viscount Systems, Inc., representing 8.4% of the
shares outstanding. A copy of the filing is available at:
http://is.gd/T1qYJL
About Viscount Systems
Burnaby, Canada-based Viscount Systems, Inc., is a manufacturer,
developer and service provider of access control security
products. The Company reported a net loss of C$2.9 million in
2011, compared with a net loss of C$1.3 million in 2010. The
Company's balance sheet at Sept. 30, 2012, showed C$1.08 million
in total assets, C$3.44 million in total liabilities and a C$2.35
million total stockholders' deficit.
"The Company's bank credit facility was suspended on December 30,
2011 due to the bank's assessment of the Company's financial
position. Management has determined that the Company will need to
raise a minimum of $500,000 by way of new debt or equity financing
to continue normal operations for the next twelve months.
Management has been actively seeking new investors and developing
customer relationships, however a financing arrangement has not
yet completed. Short-term loan financing is anticipated from
related parties, however there is no certainty that loans will be
available when required. These factors raise substantial doubt
about the ability of the Company to continue operations as a going
concern."
Following the 2011 results, Dale Matheson Carr-Hilton Labonte LLP,
in Vancouver, Canada, expressed substantial doubt about Viscount
Systems' ability to continue as a going concern. The independent
auditors noted that the Company has an accumulated deficit of
C$5,769,027 and has reported a loss of C$2,883,304 for the year
ended Dec. 31, 2011.
VITERRA INC: Moody's Raises Debt Ratings From 'Ba1'
---------------------------------------------------
Moody's Investors Service raised the ratings on Viterra Inc.'s
(Viterra, Ba1) debt following the completion of the acquisition of
Viterra by Glencore International AG (Glencore, Baa2 stable).
Viterra is now a subsidiary of Glencore. Glencore has guaranteed
the US$400 million 5.950% Senior Notes due 2020 and the rating has
been raised to Baa2 from Ba1 reflecting the guarantee. However,
because consent solicitations were rejected by holders of the
C$200 million 6.406% Senior Unsecured Notes due 2021 they are not
guaranteed. Accordingly the rating on the 2021's has been raised
to Baa3 from Ba1, one notch below Glencore's rating, reflecting
the lack of a guarantee by Glencore. The outlook for Viterra, now
a subsidiary of Glencore with two remaining rated notes is Stable.
Viterra's Ba1 Corporate Family Rating (CFR) other ratings will be
withdrawn (see list below). This action completes Viterra's rating
under review for upgrade action that was initiated on March 21,
2012.
Ratings Rationale
Issuer: Viterra Inc.
Ratings raised
C$200 million 6.406% Canada notes due 2/16/2021 raised to
Baa3 from Ba1
US$400 million 5.950% Global notes due 8/01/2020 raised to
Baa2 from Ba1
Outlook change
Viterra Inc,
Outlook Stable from RUR possible upgrade
Ratings withdrawn
Corporate Family Rating - Ba1 possible upgrade
Probability of Default Rating - Ba1 possible upgrade
C$500 million senior unsecured shelf - (P)Ba1 possible upgrade
Speculative Grade Liquidity Rating - SGL-2
The principal methodology used in rating Viterra was the Global
Commodity Merchandising & Processing Companies 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.
Viterra Inc. is a wholly owned subsidiary of Glencore
International plc, one of the world's leading integrated producers
and marketers of commodities. Regina is the headquarters for the
company's North American operations.
WP EVENFLO: Moody's Raises CFR/PDR to 'B3'; Outlook Stable
----------------------------------------------------------
Moody's Investors Service upgraded WP Evenflo Holdings, Inc.'s
corporate family rating to B3 from Caa1, the probability of
default rating to B3 from Caa1, and the rating on the senior
secured bank debt to B2 from B3. The ratings outlook is stable.
Ratings upgraded and to be withdrawn:
Corporate family rating to B3 from Caa1
Probability of default rating to B3 from Caa1
$40 million senior secured revolving credit facility to B2
(LGD3, 43%) from B3 (LGD3, 39%)
$17.5 million first lien term loan due to B2 (LGD3, 43%) from
B3 (LGD3, 39%)
Subsequent to the action, all the ratings will be withdrawn
because all rated debt has been repaid.
Ratings Rationale
The ratings upgrade was prompted by Evenflo's December 2012 sale
of its Ameda breastfeeding business and the subsequent use of
proceeds to pay down the remaining term loan and revolving credit
facility balance. The ratings upgrade reflects that all funded
debt has been repaid. The upgrade also captures Moody's view that
the company's liquidity profile has improved, owing to its
relatively large cash balance, new long-term $36 million asset-
based revolving credit facility (unrated), and flexibile financial
covenants. The rating also considers the narrow EBITDA margins of
the remaining business. While funded debt is essentially zero,
Moody's estimates pro forma leverage of near 5.0 times for 2012
when incorporating Moody's adjustments (including the pension
obligation and 75% debt treatment for the preferred stock), which
is good for the ratings category.
Evenflo's B3 corporate family rating captures its small scale,
material customer concentration, the mature nature of the
juvenile/infant product category, competition from well
capitalized companies, ongoing product recall risk, and general
product liability risk. The rating derives support from Evenflo's
established position as a seller of infant and juvenile products,
strong brand recognition, and long-standing relationships with key
retail customers.
The stable outlook reflects Evenflo's improved financial
flexibility following the sale of Ameda and the completion of a
new revolving credit facility.
Headquartered in Miamisburg, Ohio, WP Evenflo is a provider of
infant and juvenile products including car seats (convertible,
booster, and infant), on-the-go products (strollers, travel
systems, and portable playards), and playtime products (carriers,
stationary activity centers, and safety gates).
The principal methodology used in rating WP Evenflo Holdings, Inc.
was the Global Consumer Durables 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.
XZERES CORP: David Baker Resigns From Board of Directors
--------------------------------------------------------
David Baker resigned as director of Xzeres Corp. effective as of
Dec. 13, 2012. There was no known disagreement with Mr. Baker on
any matter relating to the Company's operations, policies or
practices, according to the company's regulatory filing.
About XZERES Corp.
Headquartered in Wilsonville, Oregon, XZERES Corp. designs,
develops, and markets distributed generation, wind power systems
for the small wind (2.5kW-100kW) market as well as power
management solutions.
As reported by the Troubled Company Reporter on July 3, 2012,
Silberstein Ungar, PLLC, in Bingham Farms, Michigan, expressed
substantial doubt about XZERES' ability to continue as a going
concern, following its audit of the Company's financial position
and results of operations for the fiscal year ended Feb. 29, 2012.
The independent auditors noted that the Company has incurred
losses from operations, has negative working capital, and is in
need of additional capital to grow its operations so that it can
become profitable.
The Company's balance sheet at Aug. 31, 2012, showed $4.4 million
in total assets, $5.6 million in total current liabilities, and a
stockholders' deficit of $1.2 million.
YELLOW MEDIA: S&P Cuts CCR to 'D' on Debt Recapitalization
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on Montreal-based media and marketing solutions
provider Yellow Media Inc. to 'D' (default) from 'CC'.
"At the same time, Standard & Poor's lowered its issue-level
rating on the company's medium-term notes outstanding to 'D' from
'CC' and lowered its ratings on the company's convertible
subordinated debentures to 'D' from 'C'. The recovery ratings on
these debt obligations are unchanged. The 'D' ratings on the
company's preferred shares are unchanged. At Sept. 30, 2012, YMI
reported C$1.96 billion of gross debt and C$721 million of
preferred shares outstanding," S&P said.
"The downgrade follows the company's Dec. 20, 2012, completion of
a sub-par exchange of its debt outstanding for cash, new debt
obligations, and shares of a recapitalized YMI, and constitutes an
event of default as per Standard & Poor's criteria," said Standard
& Poor's credit analyst Madhav Hari.
"Following the recapitalization, the new YMI will have C$907.5
million of debt obligations comprising C$800 million of new senior
secured notes and C$107.5 million of new senior subordinated
exchangeable debentures. The recapitalization results in the
reduction of about C$1.5 billion in YMI's principal amount of debt
(including the series 1 and series 2 preferred shares), and is
aimed at improving the company's financial flexibility, which is
necessary to advance its business transformation to a digital
media and marketing solutions company," S&P said.
YMI is a leading media and marketing solutions company in Canada.
It owns and operates some of Canada's leading properties and
publications including Yellow Pages print directories,
YellowPages.ca, Canada411.ca, and RedFlagDeals.com. YMI is also a
leader in national digital advertising through Mediative, a
digital advertising and marketing solutions provider to national
agencies and advertisers.
* Fitch Says Credit Outlook of Restaurant Industry Remains Stable
-----------------------------------------------------------------
The credit outlook for the U.S. restaurant industry remains stable
for 2013 as restaurants adjust operating and financial strategies
to manage through a challenging revenue and cost environment,
according to Fitch Ratings. Fragile economic growth, intensifying
competition, food inflation and costs to comply with elements of
the Patient Protection and Affordable Healthcare Act that become
effective Jan. 1, 2014 will be challenges for the industry.
Fitch expects average annualized same-store sales (SSS) growth of
1%-3% in the U.S. during 2013, flat to slightly weaker than the
projected average for 2012. Sales volatility is anticipated
throughout the year with the fast casual and quick-service
segments outperforming casual and family dining. Category
leaders; including McDonald's Corp. (McDonald's; 'A'/Stable
Outlook) and Darden Restaurants, Inc. (Darden; 'BBB'/Negative
Outlook) may be challenged by improving competitors like Burger
King Worldwide, Inc. (BKW; 'B'/Positive Outlook) and Bloomin'
Brands, Inc. (Not Rated).
Global economic weakness is also expected to dampen food-away-
from-home spending and SSS growth across Europe and Asia in 2013.
Fitch is forecasting negative 0.1% GDP in the Eurozone and growth
of about 8%, supported by monetary and public investment, is
projected for China. 2.3% GDP growth is projected for the U.S.,
even if the fiscal cliff is avoided.
Casual dining chains; including Darden and DineEquity, Inc. (DIN;
'B'/Stable Outlook), with mainly domestic operations, are most
vulnerable to weakness in the U.S. Europe poses the biggest risk
to McDonald's, as the region represented 40% of the firm's sales
and 38% of its operating income before corporate expenses in 2011.
Lastly, further slowdown in China is a viewed as a considerable
threat to YUM! Brands (YUM; 'BBB'/Stable Outlook) as the country
represented 44% of revenue and 42% of operating income before
corporate expenses in 2011.
Even though lackluster SSS trends affect the entire industry,
operating earnings and cash flow of restaurant chains with a high
percentage of franchised units are mostly insulated from rising
food and labor costs. Nonetheless, restaurant-level profitability
and the cash flow of franchisees which pay royalties to these
chains could be pressured. Modest margin contraction is a risk
for restaurant firms which are primarily company-operated in 2013.
Greater emphasis on value promotions, selective pricing, and cost
management will be a focus for the industry globally. While not
anticipated, an increase in the rate of dividend increases and
share repurchases concurrent with SSS weakness and broadening cost
pressures would negatively affect Fitch's outlook for the
industry.
* Fitch Projects US High Yield Default Rate to Persist Into 2013
----------------------------------------------------------------
Fitch Ratings is projecting a U.S. high yield par default rate of
2% in 2013, in line with 2012 activity. However, a bankruptcy
filing by Energy Future Holdings, given its large size ($16
billion), has the potential to drive up the rate an additional
1.5%.
The leading support for another below-average default year is
Fitch's expectation of modestly higher U.S. GDP growth of 2.3% in
2013 combined with relatively good corporate fundamentals and the
Federal Reserve's commitment to loose monetary policy. The U.S.
macro backdrop -- a mild recovery -- is expected to remain steady.
While the default rate is projected to remain low in 2013, it is
important to note that the positive high yield rating drift of
2010 and 2011 reversed direction over the course of 2012 and the
'CCC' or lower pool expanded for the first time since 2009 - now
$228 billion in size versus $197 billion at the beginning of the
year.
In addition, demand for yield product has begun to have a more
meaningful impact on transaction risk with paid-in-kind bonds,
covenant-lite loans, and surging 'CCC' issuance - all examples of
more aggressive issuance activity going into 2013. In this
context, the low default rate needs to be viewed with caution as
more of a lagging rather than leading indicator of credit
conditions.
Through mid-December, this year's default tally stood at $20.5
billion compared with $15.9 billion for all of 2011. Defaults in
November affected $1.5 billion in bonds, but December will add
another $5.6 billion, including Edison Mission's recent bankruptcy
filing.
The default rate is expected to end the year close to 2%. The
weighted average recovery rate on defaults through November was
48.3% of par.
* Moody's Says Number of Low-Rated US Companies Hits New Low
------------------------------------------------------------
The number of low-rated US companies on its B3 Negative and Lower
Corporate Ratings List has hit a new low for the year, Moody's
Investors Service says in a new report. The decline, to 152
companies from 179 at the beginning of 2012, is in line with the
rating agency's expectation that the US speculative-grade default
rate will drop to 2.5% by mid-2013, from 3.1% currently.
"Financial markets have grappled with many concerns this year, and
these have produced volatility in stocks, gold, sovereign credit
default swaps and other financial assets," says David Keisman,
Senior Vice President and author of "Decline in Low-Rated US
Companies Points to Default Rate Dip in 2013." "Nevertheless, they
have failed to dent the credit quality of the speculative-grade
non-financial companies we rate, and as a result our list has
remained stable."
Market access is the key, Mr. Keisman says. High-yield debt
issuance has been extremely strong in 2012 as investors chase
higher returns in a low interest rate environment. This has
allowed even companies at the Caa rating level to refinance their
debt maturities and bolster liquidity, and as a consequence many
have been able to forestall default.
In the past three months positive rating actions have been by far
the most common reason for companies' removal from the list, with
19 being removed via rating upgrades or outlook changes and just
one due to default, while six were removed due to rating
withdrawals. Only about 2% of corporate ratings are currently on
review for downgrade.
"Despite concerns about continued global uncertainty and the
fiscal cliff talks in Washington, the backdrop for corporate
credit quality looks stable," Mr. Keisman says. "Continued slow
economic growth in the US, combined with good liquidity and stable
business conditions in many industries, suggest little likelihood
of rating activity significant enough to produce either a spike or
sharp decline in the size of our list in 2013."
* Moody's Comments on Canada's New Covered Bond Guidelines
----------------------------------------------------------
Despite robust oversight and disclosure requirements, new
guidelines from Canada Mortgage and Housing Corporation (CMHC)
will result in greater credit risk for new programs because they
prohibit the inclusion of insured mortgages and cash as an
eligible asset in covered bond programs, according to a report
from Moody's Investors Service, "New Guidelines Are Investor-
Friendly, but New Programs Will Still Be Riskier than Existing
Insured Programs."
On December 17, 2012, the Canada Mortgage and Housing Corporation
(CMHC), the agency the Canadian legislature charged with
regulating Canadian covered bonds under the covered bond law it
passed earlier this year, issued guidelines that will govern
future covered bond eligibility and issuance.
"Credit risk will be higher in new programs than in existing
programs, which are backed by government-insured mortgages," says
Todd Swanson, a Moody's AVP and Analyst, "because the law will
prohibit having insured mortgages as collateral or cash as an
eligible asset in new programs.
"Still, the guidelines do have positive features for investors,"
he adds. The new guidelines require disclosure of detailed cover
pool data, compliance with a comprehensive set of tests to protect
against credit risks, and an independent cover pool monitor to
oversee compliance with collateral requirements.
In addition, as the covered bond regulator, CMHC's mandate to
promote a healthy housing market aligns with the interests of
covered bond investors, another positive.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Jan. 24-25, 2013
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Four Seasons Hotel Denver, Denver, Colo.
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 7-9, 2013
AMERICAN BANKRUPTCY INSTITUTE
Caribbean Involvency Symposium
Eden Roc Renaissance, Miami Beach, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 17-19, 2013
AMERICAN BANKRUPTCY INSTITUTE
Advanced Consumer Bankruptcy Practice Institute
Charles Evans Whittaker Courthouse, Kansas City, Mo.
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 20-22, 2013
AMERICAN BANKRUPTCY INSTITUTE
VALCON
Four Seasons Las Vegas, Las Vegas, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
Apr. 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
June 13-16, 2013
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Mich.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 11-13, 2013
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 8-10, 2013
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 22-24, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
Nov. 1, 2013
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Atlanta Marriott Marquis, Atlanta, Ga.
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. 25, 2013
BEARD GROUP, INC.
20th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York, N.Y.
Contact: 240-629-3300 or http://bankrupt.com/
Dec. 5-7, 2013
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Terranea Resort, Rancho Palos Verdes, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
*********
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 ***